Update on Five Year Plan - Almarai · 2020-05-07 · Almarai Company 2014 Q2 Earnings Presentation...

Almarai Company

2014 Q2 Earnings Presentation

Disclaimer

Information contained in this presentation is subject to change without further notice, its accuracy is not guaranteed and it may not contain all material information concerning the company. Neither we nor our advisors make any representation regarding, and assume no responsibility or liability for, the accuracy or completeness of, or any errors or omissions in, to any information contained herein. In addition, the information contains projections and forward-looking statements that reflect the company’s current views with respect to future events and financial performance. These views are based on current assumptions which are subject to various risks and may change over time. No assurance can be given that future events will occur, that projections will be achieved, or that the company’s assumptions are correct. Actual results may differ materially from those projected. This presentation is strictly not to be distributed without the explicit consent of Almarai Company management under any circumstances.

Almarai Company 2 2014 Q2 Earnings Presentation

Business Highlights

Key Highlights – Q2 2014

Almarai Company 4

2013

SAR 5.3 B


2014 2013 Growth 2014 2013 Growth

Sales Revenue 3,287 2,874 14.4% 6,005 5,285 13.6%

EBIT 507 484 4.9% 818 785 4.2%

Net Income 433 398 8.8% 707 653 8.2%

Operating Cashflow 735 878 -16.3% 1,311 1,019 28.7%

Capital Expenditure 739 799 -7.5% 1,683 1,566 7.5%

Number of Employees 36 K 31 K 17.8%

Net Debt 8,994 9,570 -6.0%

Net Debt to Equity 81.9% 115.6% -29.1%

EBITDA (rolling 12 months) 2,836 2,569 10.4%

Net Debt to EBITDA 3.0 3.5 -13.0%

2nd QuarterSAR Million

1st Half

Sales Highlights

Sales Analysis by Product – 6 months

Almarai Company 6

By Product 2013 By Product 2014


Fresh Dairy2.4

Cheese & Butter0.9

Bakery0.8

Fruit Juice0.8

Long-Life Dairy0.6

Poultry0.5

Other Sales0.1

SAR 6.0 B

15%

40%

13%

1%

8%10%

13%

Fresh Dairy2.1

Cheese &

Butter0.8

Bakery0.7

Fruit Juice0.7

Long-Life Dairy0.5 Poultry

0.4

Other Sales0.1

SAR 5.3 B

10%

13%

13%

15%

40%

2%

7%

Growth Driven by Poultry, Long-Life and Juice – 6 months


-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2013 2014

Revenue in SAR Million

5,285

6,005

Growth

2013 v 2014

% of Total

Growth

Fresh Dairy( YoY +14% )

289 40%

Cheese & Butter( YoY +12% )

95 13%

Bakery( YoY +9% )

62 9%

Fruit Juice( YoY +15% )

98 14%

Long Life( YoY +16% )

81 11%

Poultry( YoY +26% )

97 13%

Other Sales( YoY -1% )

(1) 0%

Total( YoY +14% )

721 100%

Sales Analysis by Country – 6 months

Almarai Company 8

By Geography 2013 By Geography 2014


KSA3.9

UAE0.6

Oman0.3

Kuwait0.3

Qatar0.3

Egypt0.3

Bahrain0.1

Jordan0.2

Export / Others

0.1

SAR 6.0 B

2%

9%

64%

5%5%

5% 5%

2%3%

KSA3.5

UAE0.5

Oman0.3

Kuwait0.3

Qatar

0.2 Egypt

0.2

Bahrain0.1

Jordan0.1

Export / Others0.1

SAR 5.3 B

65%

9%

5%5% 4%

3%4%

2%

3%

Sales Analysis by Country – 6 months


-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2013 2014

Revenue in SAR Million

5,285

6,005

Growth

2013 v 2014

% of Total

Growth

KSA( YoY +12% )

409 58%

UAE( YoY +17% )

83 11%

Oman( YoY +19% )

52 7%

Kuwait( YoY +11% )

30 4%

Qatar( YoY +28% )

63 9%

Egypt( YoY +25% )

58 8%

Bahrain( Yoy +15% )

16 2%

Jordan( YoY +9% )

11 2%

Others( YoY -1% )

(1) 0%

Total( YoY +14% )

721 100%

Distribution Center

Manufacturing Plant

Milking Parlours

Poultry Farming

Arable & Horticulture Farms

Sales growth achieved via our expanding footprints across the

region…… and resources across the globe…


Legend:

Farmland in Arizona:

• Acquisition costs of 178m SAR for

9,834 acres.

• To secure our supply of the highest

quality alfalfa hay.

• This includes investment in bailing

system and logistics & transportation

equipments.

Capital Investment of 1.3 B SAR

in Egypt includes setting up a

new juice factory, expanding

existing facilities, increasing

Beyti's fleet of vehicles and

sales network, and creating a

new dairy farm.

1st shipment in Q1

Financial Performance

Strong pipeline of innovation continues in 2014


Segment Reporting


SAR MillionDairy &

JuiceBakery Poultry

Other

Activities

Almarai

Consolidated

1st Hal f 2014

Sales 4,692.9 772.6 461.5 183.0 6,109.9

Third Party Sales 4,673.3 772.6 461.5 98.1 6,005.4

Depreciation (472.4) (67.5) (138.8) (46.2) (725.0)

Income / (loss) before NCI 897.9 66.9 (236.4) (15.9) 712.6

Total Assets 14,387.9 1,967.2 5,040.1 2,500.2 23,895.3

Return on Sales 19.2% 8.7% (51.2%) (16.2%) 11.9%

Growth versus 1st Half 2013

- Third Party Sales 13.7% 8.8% 26.5% (1.2%) 13.6%

- Income / (loss) before NCI 26.8% 2.1% 72.4% n.a. 10.2%

Q2 2014

Sales 2,557.8 399.3 250.4 162.7 3,370.1

Third Party Sales 2,547.7 399.3 250.4 89.2 3,286.5

Depreciation (238.4) (33.9) (73.8) (23.9) (370.0)

Income / (loss) before NCI 532.0 45.4 (103.4) (35.1) 438.8

Return on Sales 20.9% 11.4% (41.3%) (39.3%) 13.4%

Growth versus Q2 2013

- Third Party Sales 15.3% 8.1% 23.5% n.a. 14.4%

- Income / (loss) before NCI 20.1% (1.0%) 13.6% n.a. 10.3%

* Income/(loss) before NCI is calculated on proforma basis based on revised cost allocation done

in Q3, 2013

*

* *

*

Statement of Income – Q2 2014


SAR million 2014 2013 Change 2014 2013 Change

Sales 3,286.5 2,873.9 14.4% 6,005.4 5,284.9 13.6%

Cost of sales (2,148.1) (1,839.4) 16.8% (3,955.7) (3,422.6) 15.6%

Gross Profit 1,138.4 1,034.5 10.0% 2,049.8 1,862.3 10.1%

Selling and Distribution Expenses (527.1) (457.4) 15.2% (1,039.3) (907.5) 14.5%

General and Administration Expenses (103.8) (93.1) 11.5% (192.7) (170.0) 13.3%

EBIT 507.5 484.0 4.9% 817.9 784.8 4.2%

Share of Results of Associates (2.7) (15.8) (82.9%) 18.4 (21.8) (184.4%)

Funding Costs (68.3) (64.5) 5.8% (124.1) (112.0) 10.9%

Exchange and Currency Gains/(Losses) 20.4 6.4 218.6% 23.7 15.1 57.1%

Income from Main Operations 456.9 410.0 11.4% 735.8 666.1 10.5%

Zakat and Foreign IncomeTax (18.1) (12.1) 50.1% (23.2) (19.7) 18.2%

Income before Non Controlling

Interest438.8 398.0 10.3% 712.6 646.5 10.2%

Non Controlling Interest (5.5) 0.3 n.a (5.7) 6.9 n.a

Net Income 433.3 398.2 8.8% 706.9 653.3 8.2%

Earnings Per Share 0.71 0.67 6.0% 1.14 1.09 4.6%

Net Income % 13.2% 13.9% 11.8% 12.4%

2nd Quarter 1st Half

Balance Sheet & Cash Flows

Cash Flow Bridge – Rolling 12 months


421

2,878

1,700 (222)(3,187)

(598)

71 1,063

Cash at 30 June 2013

Operating Cash Flow

Capex / Biological Assets

Dividend Others

Cash at 30 June 2014

(SAR 642 m)

Loans Issues /

Payments /

Charges

Equity Issued -

Perpetual

Sukuk

Capex spend in line with 5YP guidance…

Almarai Company 17

Capex spend for 1st half of 2014 was 1.5B SAR. Our current year Capex guidance remains at 3.0-

3.2B SAR which is in line with our 5 year capital

expenditure guidance of 15.7B SAR.

Manufacturing and Farming spent Capex of

~0.6B SAR for various capacity expansion

projects.

Sales depot and logistics expansion accounted

for ~0.4B SAR.

Poultry capex spend for the year reached ~ 0.3B

SAR. The key highlight for the quarter is the

availability of 3rd line and its additional

expansion.

Replacement and other capex including IDJ and

US land acquisition, accounted for another

~0.2B SAR.


Balance Sheet


0 5,000 10,000 15,000 20,000 25,000

2008

2009

2010

2011

2012

2013

2014

SAR Million

Equity & Liabilites

Equity

Non Current Liabilities

Current Liabilities

46%

46%

36%

38%

17%

16%

42% 39% 19%

43% 39% 18%

49% 36% 15%

49% 38% 13%

44% 40% 16%

0 5,000 10,000 15,000 20,000 25,000

2008

2009

2010

2011

2012

2013

2014

SAR Million

Assets

Fixed Assets

Current Assets

Other Long Term Assets

71%

69%

22%

23%

7%

8%

73%

72%

69%

64%

65%

18% 9%

17% 11%

17% 14%

20% 16%

22% 13%

371 341 1,335 1,350

14,281

15,923

945

1,049 1,331

1,796

-

5,000

10,000

15,000

20,000

30 June 2013 30 June 2014

SA

R M

illio

n

Assets Net Operating Working

Capital

Biological Assets

Property, Plant and

Equipment

Intangible Assets -

Goodwill

Investment & Financial

Assets, Deferred Charges and

Derivatives

8,275

10,975

109

118

310

373

9,570

8,994

-

5,000

10,000

15,000

20,000

30 June 2013 30 June 2014

SA

R M

illio

n

Equity & Liabilities

Net Debt

Employee Benefits

Deferred Tax (Net)

Total Equity

Net Debt


3,398 3,869 4,606 6,653 8,237 8,161 8,994

94%

72% 74%

98% 101%

76% 82%

2.3x 2.3x 2.2x

2.8x

3.1x 3.0x

3.0x

0%

50%

100%

150%

200%

250%

300%

350%

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

2008 2009 2010 2011 2012 2013 Last 12

Months

Net Debt Net Debt / Equity Ratio Net Debt / EBITDA

SA

R m

illio

n

Debt Profile highlights balanced approach for

funding….


0.0

0.5

1.0

1.5

2.0

2.5

<1yr 1-2 yr 2-3yr 3-4 yr 4-5yr >5yr

SA

R M

illio

n

Debt Maturity by Age and Type

Islamic Bonds

Govt / Semi Govt Inst.

Banks

6 , 62%1 , 15%

2 , 23%

Trend charts

Analysts expectations for Q 2 2014


433.3 430.6

100.0

150.0

200.0

250.0

300.0

350.0

400.0

450.0

Actual Results Average Expectations

Net Income

3,286.5 3,235.8

1,000.0

1,500.0

2,000.0

2,500.0

3,000.0

3,500.0

Actual Results Average Expectations

Revenue

Quarterly Performance – Net Income

Almarai Company 23

* Q4 income growth is 16.0% after excluding the effect of capital gain of SAR 47.2m in Q4 2012


16

2.2

19

7.4

23

4.1

23

5.2

24

2.1

25

5.1

27

3.6

23

5.2

28

7.1

34

3.1

34

9.3

37

9.5

39

8.2

43

3.3

29

3.7

36

3.4

42

4.5

42

9.7

45

0.0

47

5.6

21

9.2

24

8.8

28

3.5

28

5.5

36

9.0

37

3.3

0

50

100

150

200

250

300

350

400

450

SA

R M

illio

n

2014 versus 2013

Q1 = 7.2%

*

Q2 = 8.8%

Robust revenue growth with challenging – but

anticipated – EBITDA & EBIT trend

Almarai Company 24

Revenue, EBITDA and EBIT Evolution


5,030

5,869

6,931

7,951

9,883

11,219

11,940

21.0%21.8%

21.1%

19.1%

16.9%16.0%

15.3%

25.3%

26.7% 27.2%

25.6%

24.2% 24.4%

23.7%

2008 2009 2010 2011 2012 2013 Last 12 Months

SA

R M

illio

n

Revenues

EBIT % to Revenues

EBITDA % to Revenues

CAGR 2008 – 2014: 17.0% (w/o impact of acquisitions 11.8%)

0%

50%

100%

150%

200%

250%

300%

350%

400%

Almarai TASI

Key Share Data


Share Price (SAR) 70.01

Current P/E Rat io (ttm) 27.8

Estimated P/E(12/2014) 23.8

Earnings Per Share (SAR) (ttm) 2.5

Market Cap (M SAR) 42,006.0

Shares Outstanding (M) 600.0

30 Day Average Volume 667,767.0

Dividend Indicated Gross Yield 1.4%

Cash Dividend (SAR) 1.0

Dividend Ex-Date 4/3/2014

5 Year Dividend Growth 8.3%

Key Stat ist ics for Almarai (30 June 2014)

21%

10%

15%

20%

25%

30%Year to date total shareholder's return since

l isting

Thank you

Almarai Company

Exit 7, North Circle Road

Al Izdihar District

P.O. Box 8524

Riyadh, 11492

Saudi Arabia

Contact for investor relations matters:

Khalid M. Al Nasser

+966 11 470 00 05 ext 1280

[email protected]

Update on Five Year Plan - Almarai · 2020-05-07 · Almarai Company 2014 Q2 Earnings Presentation...

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