Select Harvests Limited · ASX:SHV
Select Harvests — Investor Presentation (October 2017)
33 slides from Select Harvests's investor presentation, Oct 9, 2017
Slide 1: Select Harvests Capital Raising Presentation
Click to edit Master title style Select Harvests (ASX:SHV) - Capital Raising Presentation 9 October 2017 Click to edit Master text styles Select Harvests Limited © Copyright 2017 1
Slide 2: Important Information
Important Information Click to edit Master title style Summary Information This presentation has been prepared by Select Harvests Limited (ABN 87 000 721 380) (“Select Harvests”). This presentation contains information about Select Harvests and its subsidiaries and is dated 9 October 2017. The infor
Slide 3: Important Information (continued)
Important Information (continued) Click to edit Master title style Past Performance Past performance detailed in this presentation is given for illustrative purposes only and should not be relied upon as an indication of Select Harvests’ views on its future financial performance or condition. Reader
Slide 4: Capital Raising summary
Capital Raising summary Click to edit Master title style • Select Harvests (“SHV”) is raising approximately $65 million (“Capital Raising”) through: • A non-underwritten institutional placement (“Placement”) of approximately 10.7 million new SHV shares at $4.20 per share to raise approximately $45 m
Slide 5: Placement and Offer Details
Placement and Offer Details Click to edit Master title style Institutional • A non-underwritten institutional placement (“Placement”) of c.10.7m shares (representing up to 14.6% of Placement the shares on issue prior to the Placement) to raise $45.0m • The price per share under the Placement is fixe
Slide 6: Capital Raising Timetable
Capital Raising Timetable Click to edit Master title style Event Date Trading halt Thursday, 5 October 17 SPP Record date Friday, 6 October 17 Announcement of Placement and SPP Monday, 9 October 17 Announcement of completion of Placement Monday, 9 October 17 (unless completed earlier) Issue of Appen
Slide 7: Outlook
Outlook Click to edit Master title style • Fundamentals of the business and industry remain strong - global consumption of plant protein and almonds continues to grow ✓ US sales up 16% last season, absorbing increased production ✓ Further research supporting health benefits of consuming plant based
Slide 8: Outlook
Outlook Click to edit Master title style • Select Harvests 2018 crop is in the nut forming stage, pollination was fast and weather disrupted. Two frost events have occurred, predominantly affecting some areas within Select Harvests’ NSW orchards. The remainder of the growing season has been normal a
Slide 9: Market Update
Market Update Click to edit Master title style Indicative proposal to acquire Select Harvests On 19 September 2017 Select Harvests received a non-binding, indicative and highly conditional proposal from Mubadala Investment Company PJSC (Mubadala) to acquire 100% of Select Harvests for $5.85 cash per
Slide 10: Market Update (continued)
Market Update (continued) Click to edit Master title style On 25 September 2017 Select Harvests informed Mubadala that it was not prepared to advance discussions in relation to the Indicative Proposal and that Select Harvests was therefore not in a position to provide due diligence or engage with Mu
Slide 11: Appendices
Appendices Select Click Harvests Overview to edit Master title style Click to edit Master text styles 11 11
Slide 12: Strategy & Priorities
Strategy & Priorities Click to edit Master title style HORIZON 1 - PERFECT THE CURRENT MODEL Maximize Optimise & commodity Improve supply Build our grow almond value through chain efficiency systems & grow agri assets innovation our people VISION HORIZON 2 - TRANSITION INTO INTEGRATED M ODEL Select
Slide 13: Volume Growth
Volume Growth Click to edit Master title style Investment in almond Click to edit Masterorchards & processing assets largely complete = increase future earnings text styles *Yields by tree age - refer slide 16 13 13
Slide 14: Select Harvests - Financial History
Select Harvests - Financial History Click to edit Master title style Click to edit Master text styles Source: Company Data 14 14
Slide 15: EBIT Sensitivity
EBIT Sensitivity Click to edit Master title style Assuming 2017 crop variables of: • Volume: 14,100 tonnes • Almond Price: A$7.43/kg • Exchange Rate (AUD/USD): 0.75 Key Variable Impact on EBIT ($m) Volume +/-200 tonnes +/- A$1.5M Almond Price (A$/kg) +/- A$0.10/kg +/- A$1.4M Exchange Rate -/+ 1 cent
Slide 16: Select Harvests - Orchard Profile
Select Harvests - Orchard Profile Click to edit Master title style Total Planted & Under Planted* Under Development Select Harvests Development Almond orchard portfolio (as at 30 June 2017) (as at 30 June 2017) (as at 30 June 2017) Acres Hectares Acres Hectares Acres Hectares Central region Company
Slide 17: Targeting an Above Average Yield Per Acre @ Maturity
Targeting an Above Average Yield Per Acre @ Maturity Click to edit Master title style Harvest Volume (tonnes) per acre based in Harvest Volume (tonnes) per acre based on Year 1.2 Tonnes per Acre @ Maturity 1.3 Tonnes per Acre @ Maturity 1 0.0 0.0 2 0.0 0.0 3 0.3 0.3 4 0.5 0.5 5 0.8 0.8 6 1.0 1.0 7+
Slide 18: Select Harvests - Orchard Age Profile
Select Harvests - Orchard Age Profile Click to edit Master title style Significant growth Click & improvement to edit occurred Master text stylesin SHV orchard portfolio in recent years - acquisition, replants, greenfields 18 18
Slide 19: Tree Nut Pricing
Tree Nut Pricing Click to edit Master title style Click to edit Almonds areMaster currently textthe styles best value in the basket - driving consumption 19 19
Slide 20: Growing Costs
Growing Costs Click to edit Master title style SHV FY2017 Orchard Costs by Percentage Others 11% Labour 17% Havest 16% Fert & Chem 22% Fixed 8% Water Bee 11% 5% Energy 10% Labour Fert & Chem Bee Energy Water Fixed Havest Others Click to edit Master text styles Note: exclude orchard rental or lease c
Slide 21: Almond Market Outlook - US Shipments 2017 Season
Almond Market Outlook - US Shipments 2017 Season Click to edit Master title style US Export Shipments US Domestic Shipments US Total Shipments Last Year This Year Growth Growth Last Year This Year Growth Growth Last Year This Year Growth Growth (million lbs) (million lbs) (million lbs) (%) (million
Slide 22: Useful Almond Industry websites
Useful Almond Industry websites Click to edit Master title style Industry Associations • Californian Almond Board www.almondboard.com Industry Reports • US Crop Forecasts (Subjective, Objective) http://www.almonds.com/growers/resources/crop-forecasts • Monthly Almond Position Reports http://www.almo
Slide 23: Risks
Risks Click to edit Master title style This section discusses some of the risks associated with an investment in shares in Select Harvests. These risks may affect the future operating and financial performance of Select Harvests and the value of Select Harvests’ shares. The risks set out below are n
Slide 24: Specific risks
Specific risks Click to edit Master title style Sales margins, almond price and costs ▪ Sales are impacted by the market price of products sold which are subject to market forces of supply and demand. Specifically, the sales of almonds owned by Select Harvests are subject to global pricing patterns.
Slide 25: Specific risks (continued)
Specific risks (continued) Click to edit Master title style Key suppliers ▪ In addition to water, crop size and quality is heavily reliant on a number of key suppliers including access to a sustainable annual supply of bees for tree pollination. Impact of foreign exchange movements ▪ Export sales ar
Slide 26: Specific risks (continued)
Specific risks (continued) Click to edit Master title style Capital Projects ▪ As previously announced, Select Harvests has a number of major projects intended to deliver cost savings and/or processing efficiencies. As with all major capital projects, there are risks that the projects will not be co
Slide 27: General risks
General risks Click to edit Master title style Share price and volume fluctuations ▪ Securities may experience extreme price and trading volume fluctuations. Following the Capital Raising, there may not be an active trading market in Select Harvests’ shares. If a market is not sustained, it may be d
Slide 28: General risks (continued)
General risks (continued) Click to edit Master title style Taxation implications ▪ Future changes in Australian taxation law, including changes in interpretation or application of the law by the courts or taxation authorities in Australia, may affect taxation treatment of an investment in Select Har
Slide 29: Foreign selling restrictions
Foreign selling restrictions Click to edit Master title style This document does not constitute an offer of new ordinary shares ("New Shares") of the Company in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the New Shares may n
Slide 30: Foreign selling restrictions (continued)
Foreign selling restrictions (continued) Click to edit Master title style United Kingdom Neither the information in this document nor any other document relating to the offer has been delivered for approval to the Financial Conduct Authority in the United Kingdom and no prospectus (within the meanin
Slide 31: Foreign selling restrictions (continued)
Foreign selling restrictions (continued) Click to edit Master title style Hong Kong WARNING: The contents of this document have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the offer. If you are in doubt about any contents of this doc
Slide 32: Foreign selling restrictions (continued)
Foreign selling restrictions (continued) Click to edit Master title style Singapore This document and any other materials relating to the New Shares have not been, and will not be, or registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this document and any other docume
Slide 33: Thank you
Click to edit Master title style Thank you Please direct any queries to: Paul Thompson Vanessa Huxley Andrew Angus Managing Director Acting Chief Financial Officer Investor Relations +61 3 9474 3544 +61 3 9474 3544 +61 402 823 757 Please note that background material/data regarding the global almond
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