Savola Group · TADAWUL:2050
Savola — FY2018 Earnings Presentation
34 slides from Savola's earnings presentation, 2019
Slide 1: Earnings Presentation FY 2018
Earnings Presentation FY 2018 www.savola.com
Slide 2: Disclaimer
DISCLAIMER This presentation contains forward-looking statements which may be identified by the use of words like “plans,” “expects,” “will,” “anticipates,” “believes,” “intends,” “projects,” “estimates” or other words of similar meaning. All statements that address expectations or projections about
Slide 3: Group – Highlights for Q4
GROUP – HIGHLIGHTS FOR Q4 • The reported net loss for the quarter was SAR 526.0 mn compared to a net loss of SAR 37.5 mn in Q4 2017 • Savola’s retail segment recorded a net loss of SAR 285.4 mn in Q4 2018 compared to a net loss of SAR 407.6 mn in Q4 2017 • Savola Foods recorded a net loss of SAR 116
Slide 4: Group – Highlights for FY2018
GROUP – HIGHLIGHTS FOR FY2018 • The reported net loss for the year was SAR 520.4 mn compared to a net profit of SAR 1,025.6 mn last year • Savola’s retail segment recorded a net loss of SAR 917.4 mn in FY 2018 compared to a net loss of SAR 1,016.1 mn last year • Savola Foods recorded a net loss of S
Slide 5: Q4 2018 - Snapshot
Q4 2018 - SNAPSHOT Q4 2018 Revenue of SAR 5.3 bn (Q4 2017: SAR 5.8 bn) GROUP Q4 2018 Net Loss of SAR 526.0 mn (Q4 2017 Net Loss: SAR 37.5 mn) Q4 2018 Adjusted Net Loss is SAR 65.0 mn Q4 2018 Revenue of SAR 2.9 bn (Q4 2017: SAR 3.0 bn) RETAIL Q4 2018 Net Loss of SAR 285.4 mn (Q4 2017: Net L
Slide 6: FY2018 - Snapshot
FY2018 - SNAPSHOT FY 2018 Revenue of SAR 21.8 bn (FY 2017: 23.8 bn) GROUP FY 2018 Net loss of SAR 520.4 mn (FY 2017: Net Income of SAR 1,025.6 mn) FY 2018 Adjusted Net Income is SAR 11.0 mn (FY 2017: income of SAR 645 mn) FY 2018 Revenue of SAR 11.1 bn (FY 2017: SAR 11.6 bn) RETAIL FY 2018
Slide 7: Group – Consolidated Financial Snapshot
GROUP – CONSOLIDATED FINANCIAL SNAPSHOT Adjusted Net Income SAR mn Revenue Gross Profit Net Income / (Loss) / (Loss) Q4 2018 5,347 991 (526) (65) -7.7% vs. Q4-17 -14.6% vs. Q4-17 vs. (37.5) in Q4-17 vs. 328 in Q4-17 FY 2018 21,815 3,898 (520) 11 -8.5% vs. FY17 -11.3% vs. FY17 vs. 1,026 FY17 vs. 645
Slide 8: Group – Consolidated Financial Highlights
GROUP – CONSOLIDATED FINANCIAL HIGHLIGHTS SAR mn Growth Margin YoY Sales FY Sales -8% -8% -7% -8% -12% 23,830 21,815 5,787 6,653 6,148 5,596 5,212 5,795 5,347 5,108 Q1 2017 Q1 2018 Q2 2017 Q2 2018 Q3 2017 Q3 2018 Q4 2017 Q4 2018 FY 2017 FY 2018 YoY Gross Profit FY Gross Profit -11% -13% -6% -12% -15
Slide 9: Group – Consolidated Financial Highlights
GROUP – CONSOLIDATED FINANCIAL HIGHLIGHTS SAR mn Growth Margin YoY EBITDA YTD EBITDA -32% -0.2% -26% -31% -63% 1,831 438 437 1,239 331 512 549 246 351 205 Q1 2017 Q1 2018 Q2 2017 Q2 2018 Q3 2017 Q3 2018 Q4 2017 Q4 2018 FY 2017 FY 2018 5.7% 4.8% 6.6% 7.1% 9.2% 6.7% 9.5% 3.8% 7.7% 5.7% YoY Net Profit
Slide 10: Group – Consolidated Revenue Mix, Net Debt & Capex
GROUP – CONSOLIDATED REVENUE MIX, NET DEBT & CAPEX SAR bn Revenue by Business Net Debt FY 2017 FY 2018 +16% SAR 23.8 bn SAR 21.8 bn 5% 5% 1% Foods 44% 7,054 48% Retail 6,099 47% Food Services 50% Frozen Food Dec-17 Dec-18 Revenue by Geography CAPEX FY 2017 FY 2018 SAR 23.8 bn SAR 21.8 bn -41% 9% 9%
Slide 11: KSA - Macroeconomic Overview
KSA - MACROECONOMIC OVERVIEW Real GDP, % change POS & Cash Withdrawals, SAR Bn 5% VAT 4.1 Implementation 3.7 -0.7% +5.6% 2.2 2.2 936 929 981 2.0 1.7 626 -0.7 2014 2015 2016 2017 2018 E 2019 F 2020 F 2015 2016 2017 2018 Average Inflation Rate, % Private sectorTotal workforce, millions 6% General -8.6
Slide 12: Selected MENA and Commodities Overview
SELECTED MENA AND COMMODITIES OVERVIEW Real GDP, % change Currency Movement, rebased to Dec 2017 110 Egypt Turkey Iran 100 99.3 90 7.4 85.3 80 5.3 5.5 70 68.2 4.2 3.7 60 3.5 50 40 0.4 Mar-18 Apr-18 Oct-18 Jul-18 Jan-18 Jun-18 Aug-18 Dec-17 May-18 Dec-18 Feb-18 Sep-18 Nov-18 2017 2018 E 2019 F 2017 2
Slide 13: Implications of Exceptional Items
FY 2017 reported NI SAR mn 1,026 60 FX Impact Share on Impairment 65 loss from an associate Store Closure and 73 Project Write-off Panda Goodwill impairment - Geant 202 Gain on Sale of USCE 25 Gain on Sale of Panda 62 UAE leasehold rights Adjusted FY 2017 Net Income Gain on Sale of 2% of Almarai 694
Slide 14: Panda Retail Company
ae Mn EE” Ls PANDA RETAIL COMPANY . JQgola SAVOLA
Slide 15: Retail – Highlights for Q4
RETAIL – HIGHLIGHTS FOR Q4 • During Q4 2018, sales were 4.1% lower than the same quarter last year driven primarily by a decline in customer count • In order to strengthen our position further as the largest modern retailer in the country and after completing a detailed footprint evaluation exercise
Slide 16: Retail – Highlights for FY 2018
RETAIL – HIGHLIGHTS FOR FY 2018 • During 2018, sales declined by 4.6% compared to last year mainly due to a combination of store closures and a decline in customer count, on a like for like basis primarily as a result of the decline in the expatriate population • Following a detailed footprint evalu
Slide 17: Retail - Snapshot
RETAIL - SNAPSHOT Net Income Selling SAR mn Revenue Gross Profit / (Loss) Space Reduced by Q4 2018 2,863 666 (285) 56,534 m2 -4.1% vs. Q4-17 2.0% vs. Q4-17 Vs. (408) in Q4-17 Compared to Q4-17 FY 2018 11,114 2,311 (917) Total Space 689,633 m2 -4.6% vs. FY17 -0.6% vs. FY17 Vs. (1,016) in FY17 17
Slide 18: Retail – Financial Highlights
RETAIL – FINANCIAL HIGHLIGHTS SAR mn Growth Margin YoY Sales FY Sales -5% -3% Includes closures -11% -0.3% -4% 11,644 11,114 3,331 3,229 2,674 2,377 2,653 2,645 2,985 2,863 Q1 2017 Q1 2018 Q2 2017 Q2 2018 Q3 2017 Q3 2018 Q4 2017 Q4 2018 FY 2017 FY 2018 YoY Gross Profit FY Gross Profit -1% -4% +1% -3
Slide 19: Retail – Financial Highlights
RETAIL – FINANCIAL HIGHLIGHTS SAR mn Margin YoY EBITDA FY EBITDA (152) (84) (87) (75) (74) (62) 15 71 (229) (86) Q1 2017 Q1 2018 Q2 2017 Q2 2018 Q3 2017 Q3 2018 Q4 2017 Q4 2018 FY 2017 FY 2018 -3.1% -3.7% -2.6% -1.9% -2.8% -2.8% 0.5% 2.5% -2.0% -1.4% YoY Net Profit FY Net Profit Adjusted (160) (210)
Slide 20: Implications of Exceptional Items
SAR mn FY 2017 reported NI (1,016) 80 Store Closure and Project Write-off Panda Goodwill 222 impairment - Geant Gain on Sale of Panda (68) UAE leasehold rights FY 2017 Adjusted NI (782) Panda FY 2018 (917) reported NI IMPLICATIONS OF EXCEPTIONAL ITEMS Panda Land 145 and Asset Revaluation Store Closu
Slide 21: Retail – Number of Stores by Quarter
RETAIL – NUMBER OF STORES BY QUARTER Super Hyper 162 67 (1) 153 66 (7) (1) (1) Dec Q1’18 Q2’18 Q3’18 Q4’18 Additions Dec Dec Q1’18 Q2’18 Q3’18 Q4’18 Additions Dec 2017 2018 2017 2018 Pandati Total Total Pandati Format Discontinued Selling Area Selling Area 746,167 m2 689,633 m2 138 367 (6) (2) (7) (
Slide 22: Savola Foods
Ugola SAVOLA ibe 2G Fs PEAT Bae ya ec, PE ; : XM oa a SAVOLA FOODS JQola SAVOLA
Slide 23: Foods – Highlights for Q4
FOODS – HIGHLIGHTS FOR Q4 • Volumes were 12% higher than Q4 2017 at 815.0 KMT in Q4 2018, mainly driven by the increase of edible oils in Algeria and Egypt, as well as sugar for the latter • Despite the increase in volumes, Q4 2018 revenue registered SAR 2.2 bn, a 16.4% decrease compared to Q4 2017
Slide 24: Foods – Highlights for FY 2018
FOODS – HIGHLIGHTS FOR FY 2018 • Volumes increased by 1.5% reaching at 3,362 KMT in FY2018, mainly driven by a 2.0% increase in oils and a 4.5% increase in pasta • Despite the increase in volumes, FY 2018 revenue registered as SAR 9.7 bn, a 14.5% decrease compared to FY 2017 largely attributed to a
Slide 25: Foods - Snapshot
FOODS - SNAPSHOT Gross Net Income Volume SAR mn Revenue Profit / (Loss) (MT ‘000) Q4 2018 2,161 210 (116) 815 -16.4% vs. Q4-17 -49.8% vs. Q4-17 Vs. 199 in Q4-17 12.4% vs. Q4-17 FY 2018 9,735 1,221 (17) 3,362 -14.5% vs. FY17 -29.6% vs. FY17 Vs. 607 in FY17 1.5% vs. FY17 25
Slide 26: Foods – Financial Highlights
FOODS – FINANCIAL HIGHLIGHTS SAR mn Growth Margin YoY Sales FY Sales -14% -14% -13% -14% -16% 11,384 3,146 9,735 2,954 2,692 2,572 2,699 2,585 2,311 2,161 Q1 2017 Q1 2018 Q1 2017 Q1 2018 Q3 2017 Q3 2018 Q4 2017 Q4 2018 FY 2017 FY 2018 YoY Gross Profit FY Gross Profit -30% -20% -22% -28% -50% 1,734 4
Slide 27: Foods – Financial Highlights
FOODS – FINANCIAL HIGHLIGHTS SAR mn Growth Margin YoY EBITDA FY EBITDA -48% -30% -38% -84% -34% 1,064 301 227 308 552 229 212 140 152 49 Q1 2017 Q1 2018 Q2 2017 Q2 2018 Q3 2017 Q3 2018 Q4 2017 Q4 2018 FY 2017 FY 2018 7.8% 5.9% 9.6% 7.8% 8.4% 6.0% 11.9% 2.3% 9.3% 5.7% YoY Net Profit FY Net Profit Adj
Slide 28: Implications of Exceptional Items
FY 2017 SAR mn 607 reported NI 60 FX Impact Gain on Sale (15) of USCE FY 2017 652 Adjusted NI FY 2018 Savola Foods reported NI (17) IMPLICATIONS OF EXCEPTIONAL ITEMS 73 FX Impact Afia Custom Duty 32 Provision FY 2018 88 Adjusted NI 28
Slide 29: Foods – Oil Segment Analysis
FOODS – OIL SEGMENT ANALYSIS SAR mn Volume (MT ‘000) Revenues +2.0% -15.3% 1,645 7,859 1,612 5% 4% 5% 4% 5% 5% 10% 7% 6,658 9% 5% 11% 3% 9% 9% Morocco 9% Morocco YoY +5% YoY +5% 11% Sudan Sudan 30% YoY -18% 33% YoY -43% 30% Algeria Algeria YoY +12% 27% YoY +7% Turkey Turkey 13% 15% YoY -1% 11% YoY -
Slide 30: Foods – Sugar Segment Analysis
FOODS – SUGAR SEGMENT ANALYSIS SAR mn Volume (MT ‘000) (1) Revenues (1) KSA KSA YoY -5% YoY -23% Egypt Egypt YoY +46% -18.2% YoY +23% +0.1% 3,066 1,414 1,415 2,508 85% 89% 89% 84% 15% 11% 16% 11% FY 2017 FY 2018 FY 2017 FY 2018 (1) Sugar volumes and revenues include only the contribution from sugar
Slide 31: Frozen Food - Al Kabeer
Ugola SAVOLA Al raed Sal Gliaals gs dag ...dbliuss Simply...a matter of good taste! Frozen Food - Al Kabeer GOLA
Slide 32: Frozen Food – 51% Al Kabeer
FROZEN FOOD – 51% AL KABEER Company Sector Region Revenue by Geography • UAE FY18 • SAUDI ARABIA SAR 577 mn Frozen food • BAHRAIN manufacturing & distribution • OMAN Overview • Founded in 1974, Al Kabeer experienced solid growth in the frozen food industry becoming one of the leading players in the
Slide 33: Financial Summary
JgoLA FINANCIAL SUMMARY SAVOLA
Slide 34: Financials – FY 2018
FINANCIALS – FY 2018 Note: the above table includes contribution from emerging categories captured in the foods segment 34