Slide 1: Interim Report Q2 and first six months 2009
Jerker Hartwall CEO Anders Byström CFO Interim Report Q2 and first six months 2009
Slide 2: CEO Summary - Q2 2009
CEO Summary - Q2 2009 Strong cash flow in the second quarter materialised as expected and has further strengthened the balance sheet. Food Ingredients improved operating profit by 22 percent, despite the very tough economic conditions. Chocolate & Confectionery Fats continued to be negatively affect
Slide 3: Highlight Q2
Highlight Q2 Net sales unchanged, SEK 4,045 million (4,067). The operating result declined by 25 MSEK, SEK 146 million (171). The company has recorded additional preliminary insurance compensation of SEK 70 million, which is not included in the operating profit of SEK 146 million. This insurance com
Slide 4: Highlight first six months
Highlight first six months Net sales SEK 8,268 million (7,750). The operating result declined by SEK 67 million, SEK 303 million (370). Strong cash flow from operating activities before investments amounted to SEK 657 million (-315), improvement by SEK 972 million. All financial information on this
Slide 5: Background - Specialisation of the Swedish and Danish sites
Background - Specialisation of the Swedish and Danish sites • The project is developing as planned and will provide a strong base for further rationalisations Cost synergies of approx. SEK 100 million Fully implemented during 2010 One-off costs of SEK 150 million, accounted for in 2007 - of which SE
Slide 6: AAK’s rationalisation project
AAK’s rationalisation project First wave of synergies + Second wave of synergies + Third wave of synergies SEK 200 million 2005 – 2007 Without any expected additional non-recurring cost SEK 100 million 2007 – 2010 Additional SEK 200 million 2010 – 2011 = Total savings SEK 500 million, 2005 – 2011 In
Slide 7: Cost synergies 2010 -2011
Cost synergies 2010 -2011 Additional SEK 200 million Administration Production Commercials 10 % 70 % 20 % Interim Report Q2 and first six months 2009 7
Slide 8: Insurance
Insurance The second quarter includes additional preliminary insurance compensation of SEK 70 million. To date, AAK has received payments for business interruption in the amount of approximately SEK 421 million. Given the complexity of the pending claims handling process with the relevant insurance
Slide 9: Operating profit rolling months
Operating profit rolling 12 months Excl final 900 insurance 864 851 compensation 800 801 764 777 745 700 653 600 583 549 SEK million 500 498 470 455 400 300 200 100 0 2005 2006 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2007 2007 2007 2007 2008 2008 2008 2008 2009 2009 All financial information on this page is e
Slide 10: Business Areas – Gross Contribution per kilo
Business Areas – Gross Contribution per kilo Chocolate & Food Ingredients Technical Products Confectionery Fats & Feed All three business areas have improved gross contribution per kilo. The improvement in Chocolate and Confectionery Fats and Food Ingredients was largely due to positive currency imp
Slide 11: Chocolate & Confectionery Fats
Chocolate & Confectionery Fats Full Q2 Q2 Q1-Q2 Q1-Q2 Year Rolling SEK million 2009 2008 Change 2009 2008 Change 2008 12 months Operating profit 55 105 -48% 129 244 -47% 547 432 excl. non recurring items Volumes (thousand tonnes) 52 66 -21% 112 145 -23% 302 270 Q2 April - June Operating profit decli
Slide 12: Chocolate & Confectionery Fats - EBIT per tonne, rolling 12 months
Chocolate & Confectionery Fats - EBIT per tonne, SEK, rolling 12 months Excl final insurance compensation 2 000 1 811 1 742 1 800 1 693 1 600 1 600 1 488 1 363 1 400 1 236 1 200 980 1 000 800 800 660 600 400 200 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2007 2007 2007 2007 2008 2008 2008 2008 2009 2009 Interi
Slide 13: Food Ingredients
Food Ingredients Full Q2 Q2 Q1-Q2 Q1-Q2 Year Rolling SEK million 2009 2008 Change 2009 2008 Change 2008 12 months Operating profit 90 74 +22% 170 134 +27% 319 355 excl. non recurring items Volumes (thousand tonnes) 224 222 +1% 452 454 -0% 940 938 Q2 April - June The operating profit improved by SEK
Slide 14: Food Ingredients - EBIT per tonne, rolling 12 months
Food Ingredients - EBIT per tonne, SEK, rolling 12 months 378 400 362 339 335 350 312 317 311 312 314 308 300 250 200 150 100 50 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2007 2007 2007 2007 2008 2008 2008 2008 2009 2009 Interim Report Q2 and first six months 2009 14
Slide 15: Technical Products & Feed
Technical Products & Feed Full Q2 Q2 Q1-Q2 Q1-Q2 Year Rolling SEK million 2009 2008 Change 2009 2008 Change 2008 12 months Operating profit 19 18 +6% 32 38 -16% 56 50 excl. non recurring items Volumes (thousand tonnes) 66 75 -12% 139 157 -11% 301 284 Q2 April – June Operating profit improved by SEK
Slide 16: Condensed balance sheet
Condensed balance sheet -608 -1 004 -529 -1 253 Interim Report Q2 and first six months 2009 16
Slide 17: Summary Cash flow statement for the Group
Summary Cash flow statement for the Group * Cash flow from operating activities improved by almost SEK 1,000 million during the first six months compared to the six first months 2008. Interim Report Q2 and first six months 2009 17
Slide 18: Financial position
Financial position The Group’s net borrowings as at 30 June 2009 amounted to SEK 4,807 million (SEK 5,224 million on 31 March 2009). Compared to March 31 has net borrowings declined by SEK 424 million after unchanged dividend of SEK 164 million. The Group has total credit facilities of SEK 6,630 mil
Slide 19: Cash flow from ongoing business (before investments), rolling 12 months
Cash flow from ongoing business (before investments), rolling 12 months 1200 1000 800 600 400 n o 200 llii SEK Million M K ES 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 -200 2006 2007 2007 2007 2007 2008 2008 2008 2008 2009 2009 -400 -600 -800 -1000 Strong cash flow in the second quarter materialized as exp
Slide 20: Future
Future
Slide 21: Roadmap to growth in the coming years
Roadmap to growth in the coming years t s, s, EBIT fa ve te ti l a na c o a er e o ul ic h lt C BE m A rv s r C ic t s Se fo Fa t et ry ec pr ew od t sm ke FA y n oj D ir fa N Fo Ba a Co In D Applications Interim Report Q2 and first six months 2009 21
Slide 22: Strategy – driving the product mix towards increased share of speciality products
Strategy – driving the product mix towards increased share of speciality products Profit Bulk oils Speciality products Baby-food fats Bakery fats FoodService 2000 2008 Interim Report Q2 and first six months 2009 22
Slide 23: The future – Chocolate & Confectionery Fats
The future – Chocolate & Contectionery Fats CBE is cheaper and has the same functionality as cocoa butter. AAK has created the world’s largest CBE centre in Aarhus, Denmark. AAK has developed the best shea supply. Interim Report Q2 and first six months 2009 23
Slide 24: The future – Food Ingredients
The future – Food Ingredients The driving force is health, e.g. non-trans products, low content of saturated fats. Fast re-formulation to cheaper products. Changes are positive for a speciality company as AAK. Interim Report Q2 and first six months 2009 24
Slide 25: The future for AAK
The future for AAK We develop the speciality strategy. We make selective acquisitions. We are well positioned – based on investments made, geographic platforms, and strong product development. We are under development to become a more balanced company. – Strategically – Financially Interim Report Q2
Slide 26: Vegetable healthy oils have an exciting future
Vegetable healthy oils have an exciting AAK is in a strong future position to benefit from these opportunities 26
Slide 27: APPENDIX
APPENDIX
Slide 28: Cocoa Butter
Cocoa Butter Cocoa butter 60000 50000 40000 SEK/ton 30000 20000 10000 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Interim Report Q2 and first six months 2009 28
Slide 29: CBE Margin Elements
CBE Margin Elements Cocoa Butter price Raw material costs CBE Margin Fixed cost structure Competitive situation Interim Report Q2 and first six months 2009 29
Slide 30: AAK - is the world-leading producer of vegetable speciality fats
AAK - is the world-leading producer of vegetable speciality fats - Advanced technology Lowest price - Speciality producer Bulk producer Raw material Raw materials Interim Report Q2 and first six months 2009 30
Slide 31: Raw material price development
Raw material price development Raw material prices - palm, rapeseed and soyabean 1 20 0 0 Rapeseed Rap e se ed o il Soyabean Palm o il Palm So ya o il 1 00 0 0 80 0 0 SEK/t on 60 0 0 40 0 0 20 0 0 0 2 00 2 20 03 2 00 4 2 00 5 2 00 6 2 00 7 20 0 8 2 0 09 Interim Report Q2 and first six months 2009 31
Slide 32: IAS 39 effect since the merger
IAS 39 effect since the merger 400 300 200 100 0 SEK Million Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 ‐100 2006 2007 2008 2009 ‐200 ‐300 ‐400 ‐500 ‐600 IAS 39 effect in Q1 09 was SEK 63 million and Q2 09 was SEK 261 million. Interim Report Q2 and first six months 2009 32
Slide 33: Theoretical accounting effect - IAS 39
Theoretical accounting effect - IAS 39 Paper Physical contracts purchase Net position Customer Inventory contracts Only market valuation of financial derivatives are allowed in accordance with IAS 39 No cash flow impact and no impact on underlying profitability. Interim Report Q2 and first six month