Changda International Holdings Inc
Changda International — Investor Presentation (September 2009)
32 slides from Changda International's investor presentation, Sep 10, 2009
Slide 1: Changda International Holdings Inc. Investor Presentation
CHANGDA INTERNATIONAL HOLDINGS INC. The most competitive growing producer of New-Type fertilizers in China Investor Presentation August 2009
Slide 2: Non-Disclosure Statement
Non-Disclosure Statement This presentation has been prepared solely for the benefit of a limited number of sophisticated investors interested in Changda International Holdings, Inc. (“Company” or “CIHI”, Ticker: CIHI. OTCBB). This is not an offer nor solicitation, and is provided for informational p
Slide 3: Contents
Contents Company Overview ………………………………………………………………………………………………………1 Investment Highlights ……………………………………………………………………………………………………5 Industry Overview …………………………………………………………………………………………………………12 Business Operation ………………………………………………………………………………………………………15 Financial Performance ………………………………………………………………………
Slide 4: Company Overview
Company Overview 1
Slide 5: Company Overview
Company Overview Leading Compound Fertilizer Supplier Revenue Leading compound fertilizer producer in (USD Million) Shandong Province % Dedicate to developing the environment-friendly 100 AG R 86.57 C 80.96 MOIC fertilizers and slow-release fertilizers 80 60 One of the largest producers of sno
Slide 6: Company Highlights
Company Overview Company Highlights Employees 220 full-time employees 14 R&D personnel Operating locations Binhai BDZ Weifang Shandong China Production sites Eight production lines in three factories Superior microbial organic controlled release fertilizer (MOCR) Chinese government and ind
Slide 7: Company History
Company History 2000 2003 2004 2007 2008 2009 December 2000 May 2004 June 2008 February 2009 Changda Chemical Changda Fertilizer (75%) and Changda Fertilizer acquired CIHI acquired was set up to Seiwa Fertilizer Co. Ltd the remaining 25% equity Changda produce snow (“Seiwa”, 25%), jointly interest o
Slide 8: Investment Highlights
Investment Highlights 5
Slide 9: Investment Highlights
Investment Highlights Strong Product Favorable Development Government Policies Capability Full scale R& R&D support Government supports with patent coverage both of the fertilizer and agriculture industry Robust Sales Network 2 3 Experienced Management Team 80,000 selling points Senior management th
Slide 10: Robust Sales Network
1 Robust Sales Network Shandong Province Established Established an an extensive extensive sales sales network network of: of: The largest province in terms of compound fertilizer consumption 80,000 Selling points through cooperation with China The Company sells 95% of Post Logistics its fertili
Slide 11: Strong Product Development Capabilities
2 Strong Product Development Capabilities R&D Cooperation R&D Focus Work closely with prestigious professors in the Cost control and industrialization of new frontier of agricultural technologies generation compound fertilizers Chinese Academy of Agricultural Sciences Increase the concentrat
Slide 12: Favorable Government Policies
3 Favorable Government Policies Chinese government offers favorable policies to the fertilizer industry and agriculture production Favorable Policies for Fertilizer Industry Favorable Policies for Agriculture Production Advantageous electricity prices The total agricultural subsidies increase by
Slide 13: Experienced Management Team
4 Experienced Management Team Members of senior management have over 20 years of average professional expertise in the industry Qing Ran Zhu Hua Ran Zhu Leodegario Camacho ① Jan Pannemann ① Director, Co- CEO, Co-founder CFO, Director Director founder Years in industry 20+ 20+ 34 6 Management Bios •
Slide 14: Growth Drivers
Growth Drivers Shrinking Arable Land Increasing Food Requirements Rising Export Demand China’s arable land per Growing population amplifies Export demand will increase capital has decreased to 1.3 the need of crop yields as as the government mu, while the global average well as fertilizers sig
Slide 15: Industry Overview
Industry Overview 12
Slide 16: Fertilizer Industry
Fertilizer Industry China Fertilizer Industry 2006 World Fertilizer Consumption (in Nutrients) China China is the largest fertilizer market in the world, 2% Asia exclude accounting for 30% of the global consumption 13% China 51.08 million tons of fertilizer application in 30% Africa 2007 RMB 4
Slide 17: Compound Fertilizer Industry
Compound Fertilizer Industry China Compound Fertilizer Industry Compound Fertilizer Consumption in China Compound fertilizer is a type of chemical (Million Tons) 16 15.03 9% fertilizer containing at least two of the major 13.86 13.03 8% nutrients (N, P, K) 14 12.04 7% 12 11.10 Compound fertilize
Slide 18: Business Operation
Business Operation 15
Slide 19: Fertilizer Industry (Products)
Fertilizer Industry Fertilizer Products Chemical Products Fertilizer products accounted for 89.9% of total Chemical products accounted for 10.1% of total revenue in 2008 revenue in 2008 Compound Fertilizer Snow Melting Agent Rich in N-P-K; include chloride- Used in urban streets, airports, based
Slide 20: Procurement
Procurement Local Sourcing Abundant Resources Most of the raw materials of the Company are Shandong is the largest supplier of crude salt sourced in Shandong Province and bromide in China For both fertilizer and chemical businesses 40% of the crude salt in China Nearly half of the raw mate
Slide 21: Production Facilities
Production Facilities The Company applies full automatic Existing Facilities production to ensure that product quality meet the official standards • Location: Weifang Ocean Chemical Industry Developing Awarded the Certificate for Product Zone Industry Area, Weifang City Exemption from Quality Su
Slide 22: Marketing
Marketing The Company has employed various promotion techniques to impress the consumers as a brand with superior product quality and customized to local needs Pre-sales Promotion After-sales Follow-up TV advertisement Return Visit Broadcasted during prime time on Shandong Get feedbacks and
Slide 23: Financial Performance
Financial Performance 20
Slide 24: Historical Financial Performance
Historical Financial Performance Revenue Gross Profit (USD Million) (USD Million) R 8 6.57% 74.16 % CAGR G 13.05 100 CA 80.96 14 12 80 10 60 8 6.83 38.25 40 6 4.30 23.26 4 20 2 0 0 2006 2007 2008 2006 2007 2008 EBIT Net Profit (USD Million) (USD Million) % % 73.12 55.02 CAGR R 8 6.93 8 G CA 5.65 6 6
Slide 25: Income Statement
Income Statement (USD Thousand) FY2006 FY2007 FY2008 Revenue 23,259 38,245 80,958 Cost of Goods Sold (18,956) (31,417) (67,907) Gross Profit 4,303 6,828 13,051 SG&A Expenses (1,652) (2,810) (5,839) D&A Expenses (339) (224) (283) Operating Profit (EBIT) 2,312 3,794 6,929 Other Income 37 132 80 Intere
Slide 26: Balance Sheet
Balance Sheet (USD Thousand) FY2006 FY2007 FY2008 Bank Balances and Cash 716 979 575 Trade and Other Receivables, net 2,132 5,387 9,098 Inventories 1,234 1,600 4,158 Other Current Asset 256 2,237 2,750 Total Current Assets 4,338 10,218 10,203 Property, Plant and Equipment, net 7,496 14,207 16,809 Ot
Slide 27: Long-term Growth Strategy
Long-term Growth Strategy Enhance product cost • Attain higher production yields • Strategically expanding in future locations with direct access to competitiveness secure natural resource supplies • Increase product variety Develop differentiated • Expand scale of operations organically chemical pr
Slide 28: Investment Driver
Investment Driver Significant Growth Potential Organic growth aided by government plans -11th Five-Year Plan for Fertilizer Industry Highly fragmented market ripe for consolidation China Post Logistics relationship –Directors intend to extend relationship beyond Shandong Directors intend t
Slide 29: Appendix
eR CAPITAL MARKETS Appendix 26
Slide 30: Comparable Company Analysis
Comparable Company Analysis LTM Revenue LTM Net Net Closing ($mm) Income ($mm) Income 2010 LTM 2009 Company Ticker Market Cap Price 3/31/2009 3/31/2009 Margin LTM EPS 2009 EPS EPS P/E P/E 2010 P/E China Green Agriculture, Inc CGA 249.98 13.26 31.94 11.39 36% 0.62 0.73 0.85 21.4x 18.2x 15.6x China Ag
Slide 31: Current Shareholder Structure
Current Shareholder Structure Hudson ① Exceed ② Allhomely ③ Other Restricted Free Trading (Marshall Islands) (Marshall Islands) (Marshall Islands) Shares Shares 11.38% 20.58% 39.16% 20.75% 8.14% Changda International Holdings Inc. (Nevada) 100.00% Changda International (Marshall Islands) Offshore On
Slide 32: Contact
Contact Changda International Holdings Ltd. Qing Ran Zhu CEO Terry Wang Email: [email protected] Email: [email protected] Office: 86-536-851 3228 Office: 86-536-851 3228 Mobile: 86-136 0536 3536 Mobile: 86-133 0536 9960 Chardan Capital Markets, LLC New York City 17 State Street Suite 1600 New Y
Changda International Holdings — Investor Presentation (September 2009) on 6ix