Kernel Holding S.a. · GPW:KER
Kernel — H1 2019 Earnings Presentation
29 slides from Kernel's earnings presentation, February 2019
Slide 1: H1 FY2019 results and company presentation
H1 FY2019 results and company presentation February 2019
Slide 2: Disclaimer
Disclaimer The information in this document has not been independently verified and no representation or warranty, expressed or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained herein. Neither th
Slide 3: 1. H1 FY2019 results and outlook
1. H1 FY2019 results and outlook
Slide 4: Q2 FY2019 highlights
FY2019 H1 FY2019 resultsand results and Balanced outlook outlook Kernel today growth strategy Financials 1.1 Q2 FY2019 highlights Revenue for the period doubled y-o-y to US$ 1.1bn, driven by strong grain export US$ million except EPS Q2 FY2018 Q2 FY2019 y-o-y Income statement highlights volumes an
Slide 5: Segment results Q2 FY2019
FY2019 H1 FY2019 resultsand results and Balanced outlook outlook Kernel today growth strategy Financials 1.2 Segment results Q2 FY2019 Segments results (new format) Starting from Q1 FY2019 company moved to three segment disclosure instead of six Revenue, US$ m EBITDA, US$ m segment: Q2 Q2 Q2 Q2 y-
Slide 6: Harvest update and segments volumes
FY2019 H1 FY2019 resultsand results and Balanced outlook outlook Kernel today growth strategy Financials 1.3 Harvest update and segments volumes Harvest update Record-breaking yields for key crops owing to: Acreage Net yield Net tonnage – Supportive weather conditions; thousand hectares tons / ha
Slide 7: Recent transactions highlights
FY2019 H1 FY2019 resultsand results and Balanced outlook outlook Kernel today growth strategy Financials 1.4 Recent transactions highlights M&A transactions Debt transactions Acquisition of 100% interest in RTK-Ukraine (Feb 2019) Loan from European Investment Bank (Dec 2018) Assets acquired: 2,949
Slide 8: Outlook for FY2019
FY2019 H1 FY2019 resultsand results and Balanced outlook outlook Kernel today growth strategy Financials 1.5 Outlook for FY2019 Oilseed Processing Improvement of crushing margin is expected as a record sunflower seed harvest of around 15.7m tons in FY2019 (up 17% y-o-y) shall improve oilseed suppl
Slide 9: 2. Kernel today
2. KERNEL TODAY
Slide 10: Kernel today
H1 FY2019 results and Balanced outlook Kernel Kernel today today growth strategy Financials 2.1 Kernel today Oilseed processing segment EBITDA 1, US$ million Key financials, US$ m1 FY15 FY16 FY17 FY18 LTM #1 sunflower oil producer and exporter in the world 213 Revenue 2,330 1,989 2,169 2,403 3,586
Slide 11: What we do
H1 FY2019 results and Balanced outlook Kernel Kernel today today growth strategy Financials 2.2 What we do 1 Own farming: Kernel 6 Bottled sunflower oil: 7 Export terminals: Kernel operates 550 thousand ha of Approximately 8% of gross operates farmland in Ukraine bulk sunflower oil produced is • Dee
Slide 12: Efficient and well-invested asset base
H1 FY2019 results and Balanced outlook Kernel Kernel today today growth strategy Financials 2.3 Efficient and well-invested asset base Sunflower seed crushing capacity in thousand tons Poltava Transshipment capacity in thousand tons 429 Vovchansk 363 Prykolotne 172 Prydniprovskyi 617 Ellada1 275 Kir
Slide 13: Kernel's key milestones
H1 FY2019 results and Balanced outlook Kernel Kernel today today growth strategy Financials 2.4 Kernel’s key milestones Asset-light Acquisition of IPO & listing on Extending oilseed • Entering the Russian market by Exit of highly Acquisition of • Active export platform sunflower oil brand the Warsaw
Slide 14: Oilseeds Processing segment
H1 FY2019 results and Balanced outlook Kernel Kernel today today growth strategy Financials 2.5 Oilseeds Processing segment Sunflower oil sales EBITDA margins Segment’s EBITDA on the LTM basis down 4% y-o-y, to US$ 91m thousand tons US$ / ton of sunflower oil sold 1,413 1,480 1,207 190 1,123 1,072
Slide 15: Infrastructure and Trading segment
H1 FY2019 results and Balanced outlook Kernel Kernel today today growth strategy Financials 2.6 Infrastructure and Trading segment Key segment volumes Operational highlights Key export markets in FY2018 8.5 5.1m tons of grain exported from Ukraine on the LTM basis, 33% up y-o-y Thousand tons (excl
Slide 16: Farming segment
H1 FY2019 results and Balanced outlook Kernel Kernel today today growth strategy Financials 2.7 Farming segment Acreage harvested Crop yields 1 thousand hectares 596 tons per hectare, net FY2019 529 FY2018 50 9.9 FY2017 LTM EBITDA of US$ 169m, 113% up y-o-y 8.9 65 34 FY2016 383 391 385 36 FY2015 1
Slide 17: 3. Balanced growth strategy
3. Balanced growth strategy
Slide 18: Kernel's mid-term strategy
H1 FY2019 Balanced results and growth Balanced outlook Kernel today growth strategy strategy Financials 3.1 Kernel’s mid-term strategy We aim to profitably double export volumes by FY2021, providing comprehensive solutions to our clients (customers and suppliers), with balanced development of our bu
Slide 19: Strategy 2021 serves as a solid basis for future growth
H1 FY2019 Balanced results and growth Balanced outlook Kernel today growth strategy strategy Financials 3.2 Strategy 2021 serves as a solid basis for future growth Strategy 2021 pipeline overview: Approximate CapEx budgets, US$ m (excl. VAT) I Construction of greenfield oilseed processing plant in W
Slide 20: 4. Financials
4. FINANCIALS
Slide 21: Consolidated statement of profit or loss
H1 FY2019 results and Balanced outlook Kernel today growth strategy Financials Financials 4.1 Consolidated statement of profit or loss US$ million, except ratios and EPS FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 LTM Revenue 215 350 663 1,047 1,020 1,899 2,072 2,797 2,393 2,330
Slide 22: Balance sheet
H1 FY2019 results and Balanced outlook Kernel today growth strategy Financials Financials 4.2 Balance sheet Balance sheet highlights 31 Dec US$ million FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 2018 Cash & cash equivalents 6 25 89 129 59 116 83 79 65 129 60 143 132 127 Net tra
Slide 23: Cash flow statement
H1 FY2019 results and Balanced outlook Kernel today growth strategy Financials Financials 4.3 Cash flow statement US$ million FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 LTM EBITDA 17 46 123 190 190 310 319 288 223 397 346 319 223 329 Finance cost paid (9) (18) (28) (32) (23) (3
Slide 24: IR contact and investor calendar
IR contact and investor calendar Michael Iavorskyi Investor Relations Manager ir@kernel.ua Tel.: +38 (044) 461 88 01, ex. 7275 3 Tarasa Shevchenka Lane, Kyiv Ukraine, 01001 Investor calendar H1 FY2019 Financial Report 28 February 2019 Q3 FY2019 Operations Update 19 April 2019 Q3 FY2019 Financi
Slide 25: Appendices
APPENDICES
Slide 26: Key highlights
A1. Key highlights Kernel operates in globally competitive growing Ukrainian agri sector Integrated, resilient and simple business model built around scale & global reach Leader across all market segments supported by unparalleled world-class asset base with high barriers to entry Top standa
Slide 27: Markets and business environment: sunflower oil
A2. Markets and business environment Sunflower oil Global consumption of vegetable oils Global sunflower oil exports Global edible oils market trends million tons 198 million tons Consumption of edible oils increased by 4.0% y-o-y in marketing year 10.4 9.9 167 9.7 2017/18, versus 3.3% growth a ye
Slide 28: Markets and business environment: infrastructure and trading
A3. Markets and business environment Infrastructure and Trading Global grain exports Top grain exporting countries Top 5 grain exporters from Ukraine million tons million tons 2014/15 2015/16 2016/17 2017/18 429 412 427 Nibulon SFGCU Nibulon Nibulon 394 377 USA 27 SFGCU Kernel Kernel Kernel 28 27 22
Slide 29: Low cycle of soft commodity prices
A4. Markets and business environment Low cycle of soft commodity prices Index of soft commodity prices, US$-inflation adjusted 300% 250% 200% 150% 100% 50% Feb-04 Feb-05 Feb-06 Feb-07 Feb-08 Feb-09 Feb-10 Feb-11 Feb-12 Feb-13 Feb-14 Feb-15 Feb-16 Feb-17 Feb-18 Feb-19 1 2 3 Wheat Corn Sunflower oil N