Slide 1: SIPEF Analyst presentation February 16, 2023
SIPEF Analyst presentation February 16, 2023 1
Slide 2: Summary
Summary SIPEF group - Company profile SIPEF group - Sustainability SIPEF group - Palm oil in the world SIPEF group - Production & prices SIPEF group – Financial performance SIPEF group - Prospects
Slide 3: The Connection to the world of Sustainable Tropical Agriculture
The Connection to the world of Sustainable Tropical Agriculture 3
Slide 4: SIPEF business strategy is built on controlled growth as an upstream player
SIPEF business strategy is built on controlled growth as an upstream player and be the preferred supplier of traceable, sustainable, high-quality products looking at diversification into the targeted markets 4
Slide 5: SIPEF at a glance
SIPEF AT A GLANCE Belgium USD 527 million Headquarters Total sales in FY2022 1919 More than More than 22.000 32.000 T employees of bananas produced More than Listed on the 400.000 T of certified CPO produced EURONEXT stock exchange 100% Rainforest alliance CERTIFIED RSPO COMPLIANT 5
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Slide 7: Planted hectares per 31 December 2022
PLANTED HECTARES PER 31 DECEMBER 2022 Hectares 2022 Indonesia PNG Ivory Coast 100% Palm 64.766 13.588 0 78.354 Rubber 1.954 0 0 1.954 Bananas 0 0 945 945 Other 0 0 31 31 Total planted 66.720 13.588 976 81.283 7
Slide 8: Evolution planted hectares palm
EVOLUTION PLANTED HECTARES PALM EVOLUTION OWN PALM HECTARES 90.000 +219% 80.000 70.000 60.000 50.000 40.000 30.000 20.000 10.000 0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Slide 9: Evolution own CPO productions
EVOLUTION OWN CPO PRODUCTIONS EVOLUTION OWN CPO PRODUCED 500.000 +351% 450.000 400.000 350.000 300.000 250.000 200.000 150.000 100.000 50.000 0 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022E 2023 2024 2025 2026 2027
Slide 10: Evolution total CPO productions
EVOLUTION TOTAL CPO PRODUCTIONS EVOLUTION TOTAL CPO PRODUCTION 600.000 500.000 400.000 300.000 200.000 100.000 0 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 10 Tolan Tiga Group Agro Muko Group Hargy Oil Palm Ltd. UMW Group South Sumatra Group
Slide 11: Summary
Summary SIPEF group - Company profile SIPEF group - Sustainability SIPEF group - Palm oil in the world SIPEF group - Production & prices SIPEF group – Financial performance SIPEF group - Prospects
Slide 12: Sustainability is at the core of SIPEF's business model
Sustainability is at the core of SIPEF’s business model and the Group has made a top-down commitment to ensuring its activities make a positive contribution to the environment, society and local economies. 12
Slide 13: Social initiatives
44 Schools eE.f 15 Day care facilities 39 Clinics Lint de 8 436 Houses OIL PALM SMALLHOLDERS BY COUNTRY SCHEME VS. INDEPENDENT OIL PALM SMALLHOLDERS 5513 Indonesia 60% 5.882 Scheme 3635, Smallholders Papua New Guinea 64% 3266 Independent Smaliholders 36% SOCIAL INITIATIVES 13
Slide 14: Environmental initiatives
NO DEFORESTATION PROTECTION AND RESTORATION DEFORESTATION MONITORING BIODIVERSITY MONITORING AND NO HUNTING LAND USE CHANGE VERIFICATION SUPPORTING BIODIVERSITY PROGRAMMES AND LANDSCHAPES FIRE PREVENTION AND MANAGEMENT ENVIRONMENTAL INITIATIVES 14
Slide 15: geosipef.com
http://www.geosipef.com / 15
Slide 16: Environmental initiatives
ENVIRONMENTAL INITIATIVES 16
Slide 17: Governance initiatives
Corporate Governance Charter Ethics Policy Code of Conduct General Privacy Policy Grievance Whistleblowing Poll olicy ! ale Policies eS GOVERNANCE INITIATIVES 17
Slide 18: Summary
Summary SIPEF group - Company profile SIPEF group - Sustainability SIPEF group - Palm oil in the world SIPEF group - Production & prices SIPEF group – Financial performance SIPEF group - Prospects
Slide 19: Land use for vegetable oils in hectares
LAND USE FOR VEGETABLE OILS IN HECTARES 350.000.000 300.000.000 250.000.000 200.000.000 150.000.000 100.000.000 50.000.000 0 1962 1973 1988 2014 1961 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1989 1990 1991 1992 1993 1994
Slide 20: To feed a global population set to reach 9.8 billion by 2050
To feed a global population that is set to reach 9.8 billion by 2050 we will need to use less land to produce 60% more food United Nations. Feeding the World Sustainably. 2012. 20
Slide 21: Vegetable oil production
VEGETABLE OIL PRODUCTION 2050 307 MT - 340 MT 2021 236 MT 1994 93.1 MT 19,7% 31,4% 15% 4,4% 34% 20% 9,0% 5% 8% 11% 10,7% 24,7% 21 Source: Oilworld
Slide 22: Oil and fat consumption per capita
OIL AND FAT CONSUMPTION PER CAPITA Oil and fat per capita consumtion (in Kg) 80 72,35 = 3 billion people 70 67,59 66,08 59,43 60 56,71 55,77 50 39,05 40 35,54 30,70 29,26 30 25,52 24,20 25,86 21,46 20 17,19 15,57 15,34 14,04 10 0 EU-28 USA China India Indonesia Pakistan Nigeria Brazil World 2020 201
Slide 23: Palm oil production in the world
PALM OIL PRODUCTION IN THE WORLD 2021 Palm oil production Total of 75,9 Mn tonnes 5% 6% Indonesia 3% 4% Malaysia Thailand Africa 24% 59% Middle & South America Other countries 23 Source: Oilworld
Slide 24: Resources used per vegetable oil
RESOURCES USED PER VEGETABLE OIL 24
Slide 25: Area of land needed to meet global vegetable oil demand
AREA OF LAND NEEDED TO MEET TOTAL GLOBAL VEGETABLE DEMAND PER VEGETABLE OIL (2019) IN MILLION OF HECTARES Palm oil 77 Sunflower oil 312 Rapeseed 318 Soybean oil 478 Olive oil 818 Coconut oil 830 Groundnut oil 1.590 Cottonseed oil 1.860 Sesameseed oil 2.940 0 500 1.000 1.500 2.000 2.500 3.000 25 Sour
Slide 26: Sipef CAGR since 1997 = 4,67%
Sipef CAGR since 1997 = 4,67% 26
Slide 27: Yield per hectare Indonesia and Malaysia
YIELD PER HECTARE INDONESIA AND MALAYSIA Sipef average CPO yield 2022 = 5,24 T/Ha 27
Slide 28: Sustainable palm oil
SUSTAINABLE PALM OIL A SUSTAINABLE SOLUTION ➢ HALTING DEFORESTATION; ➢ TREATING COMMUNITIES AND WORKERS FAIRLY; ➢ PROTECTING WILDLIFE AND THE ENVIRONMENT. Less than 3 million tons is sold as IP/‘segregated’ (100% traceable) SIPEF = 100% compliant and > 400.000 tons (palm products) ‘segregated’ 28
Slide 29: Industrial oil palm expansion
INDUSTRIAL OIL PALM EXPANSION 29 Source: TheTreeMap
Slide 30: European Commission approves phase-out of palm oil-based biofuel by 2030
The European Commission has officially approved a measure to phase out palm oil- based biofuel by 2030. 30
Slide 31: Biodiesel use of major feedstock
BIODIESEL USE OF MAJOR FEEDSTOCK Biodiesel use of major feedstock (Mn T) 50,00 45,00 11,41 40,00 10,16 10,36 9,46 35,00 6,87 8,26 6,52 6,3 30,00 7,62 5,93 6,69 6,35 25,00 5,50 6,94 6,84 4,57 7,21 3,67 17,36 20,00 6,96 17,62 17,07 6,30 14,61 2,71 6,20 6,23 11,47 15,00 2,55 10,76 6,38 10,16 1,82 8,62
Slide 32: Biodiesel worldwide
BIODIESEL WORLDWIDE Biodiesel worldwide 2021 Total of 47,9 Mn tonnes Biodiesel worldwide 2017 Total of 35,8 Mn tonnes 12% 5% 10% 0% 36% 4% 31% 7% 7% 0% 1% 14% 19% 27% 26% 32 Source: Oilworld
Slide 33: Palm oil use for biodiesel EU
PALM OIL USE FOR BIODIESEL EU 2021: Palm oil use for Biodiesel Total of 17,4 Mn tonnes EU 26% 2017 Palm oil use for Biodiesel Total of 11,6 Mn tonnes 4,6 Mn EU tonnes 36% 4,2 Mn tonnes 12,8 Mn tonnes 7,4 7,4Mn Mn Non EU tonnes tonnes 64% NON EU 74% EU Non EU EU NON EU 33 Source: Oilworld
Slide 34: Summary
Summary SIPEF group - Company profile SIPEF group - Sustainability SIPEF group - Palm oil in the world SIPEF group - Production & prices SIPEF group – Financial performance SIPEF group - Prospects
Slide 35: Yield per hectare, average age, CPO production
YIELD PER HECTARE AVERAGE AGE 13,6 12,7 12,7 13,1 12,3 22,2 22,1 21,6 10,3 10,3 10,4 9,9 9,4 19,8 19,5 18,9 19,1 18,6 18,5 18,5 2018 2019 2020 2021 2022* Average age Average age peer review CPO PRODUCTION 403.927 384.178 351.757 329.284 312.514 5,2 5,2 5,3 4,6 4,5 4,3 4,2 4,1 4,1 4,1 2018 2019 2020
Slide 36: Group productions – crude palm oil
GROUP PRODUCTIONS – CRUDE PALM OIL Palm Oil 2022 2021 Variance Own Tolan Tiga Group 68 975 67 550 2,11% Umbul Mas Wisesa Group 42 272 42 733 -1,08% Agro Muko Group 83 075 90 895 -8,60% South Sumatra Group 32 289 21 331 51,37% Hargy Oil Palms 102 479 94 231 8,75% Total own 329 090 316 740 3,90% Outgr
Slide 37: Monthly group productions - CPO
MONTHLY GROUP PRODUCTIONS - CPO CPO productions 2022 40.000 35.000 30.000 25.000 20.000 15.000 10.000 5.000 0 January February March April May June July August September October November December Mtd LY Mtd CY Est CY 37
Slide 38: Group productions – bananas
GROUP PRODUCTIONS – BANANAS Bananas 2022 2021 Variance Azaguié 12 833 13 113 -2,14% Agboville 9 383 9 507 -1,30% Motobé 7 543 9 581 -21,27% Lumen 2 511 0 - Akoudje 0 0 - Total Bananas 32 270 32 200 0,22% 38
Slide 39: Bull and bear
BULL AND BEAR Rating Bullish inputs Bearish inputs Palm Oil Neutral - Reduced palm growth in Indo & Mal for - Food inflation. year - Macro outlook with recession fears and rising Feb 980 - Stronger seasonal drop in palm interest rates. March 1005 production in Q1….also rain impacted - Record soybean
Slide 40: CPO prices 2022 – 2021
CPO PRICES 2022 – 2021 Crude Palm Oil in $/mt CIF Rotterdam $1.800 $1.600 $1.400 $1.323 $1.200 $1.000 $1.035 $800 J F M A M J J A S O N D 2021 2022 Source: Oil World 40
Slide 41: Spread CPO – soybean oil
1.000 $ 1.400 $ 1.600 $ 2.000 $ 400 $ 800 $ 1.200 $ 1.800 $ 600 $ 2010M01 2010M04 2010M07 2010M10 2011M01 2011M04 2011M07 2011M10 2012M01 2012M04 2012M07 2012M10 2013M01 2013M04 2013M07 2013M10 2014M01 2014M04 2014M07 2014M10 2015M01 2015M04 2015M07 2015M10 CPO 2016M01 2016M04 2016M07 SPREAD CPO – S
Slide 42: Summary
Summary SIPEF group - Company profile SIPEF group - Sustainability SIPEF group - Palm oil in the world SIPEF group - Production & prices SIPEF group – Financial performance SIPEF group - Prospects
Slide 43: Exchange rates
EXCHANGE RATES IDR/USD 16.500 16.000 15.500 15.000 14.500 14.000 13.500 13.000 43
Slide 44: Ex-mill gate selling prices
EX-MILL GATE SELLING PRICES EMG 31/12/2022 31/12/2021 Indo 839 727 PNG 1.222 933 Total 996 807 44
Slide 45: Applicable export levy and tax Indonesia
APPLICABLE EXPORT LEVY AND TAX INDONESIA 45
Slide 46: Income statement actuals CY vs PY
INCOME STATEMENT ACTUALS CY VS PY In KUSD Act. 2022 Act. 2021 Difference Gross margin Palm 221.248 166.562 33% Rubber -4.104 -2.608 57% Tea 196 134 46% Bananas 2.201 3.610 -39% Horticulture 93 192 -52% G&A including corporate -42.027 -35.562 Other operating 705 -4.552 Operating result 178.312 127.77
Slide 47: Income statement actuals CY vs PY (cont.)
INCOME STATEMENT ACTUALS CY VS PY (CONT.) In KUSD Act. 2022 Act. 2021 Profit before tax 172.557 124.997 Tax -59.536 -36.075 Profit after tax 113.021 88.922 Associated companies -566 -1.091 Record profit SOTG Profit for the period 112.455 87.831 (+27%) since previous Gain on sale PT Melania 0 11.640
Slide 48: Consolidated balance sheet (mngt presentation)
CONSOLIDATED BALANCE SHEET (MNGT PRESENTATION) In KUSD (management presentation) 2022 2021 Biological assets (depreciated costs) - bearer plants 316 714 307 371 Goodwill 104 782 104 782 Other fixed assets 383 287 363 934 Receivables > 1 year 28 287 25 666 Assets held for sale 13 520 13 520 First tim
Slide 49: Overview CPO stock
OVERVIEW CPO STOCK 70.000 60.000 50.000 40.000 Tons of CPO 2021 2022 30.000 29.016 26.026 20.000 10.000 0 1 2 3 4 5 6 7 8 9 10 11 12 49
Slide 50: Evolution net tax position
EVOLUTION NET TAX POSITION • The evolution of the net tax receivable can be split into: 2019 2020 2021 2022 Indonesia 7 908 409 -10 214 -3.242 PNG 6 635 6 907 -7 770 -28.690 Europe + IC -236 -237 108 -408 Total 14 307 7 079 -17 877 -32 340 + 46.647 KUSD 50
Slide 51: Consolidated cash flow (mngt presentation)
CONSOLIDATED CASH FLOW (MNGT PRESENTATION) In KUSD (management presentation) 2022 2021 Cash flow from operating activities before change in net working capital 216.714 178.796 Change in net working capital -6.455 -8.523 Income taxes paid -44.964 -9.962 Cash flow from operating activities after tax 1
Slide 52: Value per hectare and P/E
VALUE PER HECTARE AND P/E Sensitivity 31/12/2022 Sensitivity P/E Stock price @ USD per hectare Stock price @ P/E at 2022 40,00 5.068 40,00 4,09 50,00 6.484 50,00 5,12 60,00 7.900 60,00 6,14 70,00 9.316 70,00 7,17 80,00 10.732 80,00 8,19 90,00 12.148 90,00 9,21 BOOKVALUE PER HECTARE = 9.863 USD/Ha HI
Slide 53: Dividend proposal
DIVIDEND PROPOSAL Dividend History Sipef 3,50 € 35% 32% 32% 30% 31% 31% 31% 30% 30% 30% 30% 3,00 € 30% 25% 25% 25% 2,50 € 24% 25% 23% 22% 21% 2,00 € 20% 17% 1,50 € 3,00 15% 1,00 € 2,00 10% 1,70 1,70 1,60 1,50 1,25 1,25 1,25 0,50 € 1,10 5% 0,80 0,80 0,60 0,55 0,30 0,30 0,40 0% 0,35 0,00 0,00 € 0% 200
Slide 54: Summary
Summary SIPEF group - Company profile SIPEF group - Sustainability SIPEF group - Palm oil in the world SIPEF group - Production & prices SIPEF group – Financial performance SIPEF group - Prospects
Slide 55: Prospects 16/02/2023
PROSPECTS 16/02/2023 ✓ Production ➢ Palm oil productions in Indonesia at the beginning of the year below expectations but expected to stabilize; ➢ Rainy season in HOPL has started but crop volume remain high; ➢ Production of palm oil for 2023 expected to grow with a factor of 5% close to 425.000 ton
Slide 56: Prospects 16/02/2023
PROSPECTS 16/02/2023 ✓ Cash flow and expansion ➢ Investment program remains to be fully focused on development of palm oil activities in South Sumatra; ➢ Construction second palm oil mill in Musi Rawas was started in 2022 ➢ By 2023, a total of 10 103 hectares will have been replanted in Dendymarker
Slide 57: The Connection to the world of Sustainable Tropical Agriculture
The Connection to the world of Sustainable Tropical Agriculture 57