Full Year Results 2024
and Future Strategy
December 2024
David White, Chief Executive Officer, Group
Gavin Manson, Chief Financial Officer, Group
Joshua Hoopes, Chief Executive Officer, Global Agriculture
Results and Future Strategy
2024 Overview: Transformative change to drive future growth
Update on strategy for Engineering Division
Financial Review: FY2024 Results
Agriculture Review and Strategy
PLC / Central Strategy
Summary
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2024 Overview: Transformative changes to drive future growth
Highlights:
Process to realise value for Engineering Division is continuing positively
Parallel focus on preparing the Group for its future with a clear strategy for value generation in Global Agriculture
Global Agriculture leadership team in place and focussed strategy for the future developed
FY25 EBIT-enhancing actions taken on under-performing core Agriculture businesses and non-core loss making business closed in October 2024
Central cost reductions in progress, alongside property sales and pension scheme de-risking
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Value Realisation of Engineering Division
Strategy Review
In April 2024 we announced we were exploring options regarding the potential disposal of the Engineering Division
Driving performance across two separate
'small' divisions is costly and generalist
Engineering Division performance slowly improving on prior years and order book levels holding steady
Agriculture Division required significant change
Simplify and de-risk non-core activities in parallel with this process
Process Update
Engineering Division continuing to perform strongly and generate cash
Forward order book continuing close to record high level despite significant growth in recognised revenue
Process to realise value is ongoing and continuing positively
Further updates will be provided in due course
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Progress in Agriculture
Simplification and Focus
Single division allows expert focus on Agriculture, which offers long-term growth based on core products - in existing and new markets
Will also bring improved capital allocation to assess growth opportunities versus return of capital and subsequent performance
Phased streamlining of central costs has begun, creating opportunity for significant cost savings
Sector Expertise Brought in to Lead
Agriculture Business
Joshua Hoopes joined as CEO Global Agriculture in March 2024
Supported by new UK Commercial Director and UK Operations Director bringing consistency of approach across customers, products and sites
New leadership in US feed blocks business, with Zach Westberg appointed as President
Shift of functional support from centre to dedicated divisional roles brings focus on talent development
Leadership team has new markets experience to execute strategic plans
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Financial Review:
FY2024 Results
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Basis of Presentation Of Financial Results
Basis of Presentation
Given status of transformational activities at the period end statutory reporting is required to separate continuing and discontinued activities - albeit that relevant changes have / will occur after the year end
Actual performance in the year is shown through Like for Like presentation - reflecting Group structure throughout FY24
Continuing Activities
Continuing Activities represents:
Our Agriculture businesses in UK, US (continuing) and New Zealand and JVs in US and Germany
Our central cost base not directly relating to discontinued activities
Discontinued Activities
Discontinued Activities represents
The Engineering Division
(process underway)
The Afgritech business in New York State (closed 31 October 2024)
Non-core properties (10 properties, one sold in FY24, six sold post year end, three in process)
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Continuing Operations
Revenue: UK Agriculture
US Agriculture
Total
Adjusted EBIT: UK
US
JV profits
Central
Total
Adjusted EPS (p)
Basic EPS (p)
FY24 | FY23 | Change |
£m | £m | £m |
38.2 | 36.1 | 2.1 |
37.5 | 45.7 | (8.2) |
75.7 | 81.8 | (6.1) |
1.1 | 2.6 | (1.5) |
2.7 | 1.8 | 0.9 |
1.4 | 1.4 | - |
(3.0) | (3.0) | - |
2.2 | 2.8 | (0.6) |
2.5 | 2.5 | - |
(4.8) | (1.0) | (3.8) |
Continuing Operations represents our Agriculture businesses in UK, US (continuing) and New Zealand and JVs in US and Germany
Agriculture recovery momentum building:
YOY variance (%) | H1 | H2 | ||
Volume | UK | +11 | +13 | |
US | -18 | -9 | ||
(excludes Animax)
UK feed blocks recovery more advanced in recovery than US, where southern states continue to be drought impacted
US feed blocks volume influenced by closure of Nevada plant in December 2023 and volume recovery much stronger in northern states than southern (drought)
UK influenced by Animax sales performance:
H1: -1%, H2: -15%. Rapid turnaround plan in progress
Structure of subscale, loss making New Zealand business changed post Y/E
Central costs cover group functions, cost reductions underway
- H2 down 18% YOY
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Like for Like Disclosure
FY24 | FY23 | Change | |
£m | £m | £m | |
Revenue: Agriculture | 88.0 | 92.6 | (4.6) |
Engineering | 60.1 | 50.6 | 9.5 |
Total | 148.0 | 143.2 | 4.8 |
Adjusted EBIT: Agriculture | 4.7 | 5.6 | (0.9) |
Engineering | 7.2 | 5.3 | 1.9 |
Central | (3.0) | (3.0) | - |
Total | 8.9 | 8.0 | 0.9 |
Adjusted EPS (p) | 2.5 | 2.5 | - |
Basic EPS (p) | (6.1) | (0.3) | (5.8) |
Like for Like Disclosure reflects the Group as it traded throughout FY24 and on a basis consistent with that disclosed as Continuing Operations in the Group's FY23 reporting.
Agriculture volume recovery offset by lower input and sales pricing
Performance impacted by issues at Afgritech (£0.5m loss: closed) and Animax (£0.8m loss: accelerated turnaround plan) and New Zealand (£0.3m loss: model changed)
Engineering performs strongly in most markets
Order book remains close to record levels
Central costs flat overall but down 18% YOY in H2 as impact of reductions begin to take hold
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2024 Summary Financials - Agriculture Like For Like
Revenue (£m)
100.0 | 68.5 | 78.1 | 92.6 | 88.0 | ||||
80.0 | ||||||||
35.5 | 35.2 | |||||||
60.0 | 35.4 | |||||||
28.3 | ||||||||
40.0 | ||||||||
57.1 | 52.8 | |||||||
20.0 | 40.2 | 42.7 | ||||||
0.0 | ||||||||
2021 | 2022 | 2023 | 2024 | |||||
H1 | H2 | FY | ||||||
Adjusted Operating Profit (£m) | ||||||||
10.0 | 9.4 | 9.2 | ||||||
1.1 | 2.7 | 5.6 | ||||||
4.7 | ||||||||
5.0 | ||||||||
8.3 | 6.5 | |||||||
6.0 | 4.9 | |||||||
0.0 | -0.4 | -0.2 | ||||||
2021 | 2022 | 2023 | 2024 | |||||
-5.0 | ||||||||
H1 | H2 | FY |
Trading conditions
H1 volume and revenue reduction as challenging conditions continued
H2 volume recovery commenced - but seasonally lower
Sequential improvement has continued into Q1 FY25
UK recovery ahead of US where southern states still impacted by drought
Strong performance in most businesses off set by underperformance in: Afgritech, New Zealand and Animax - all addressed post year end
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