Almarai Company · TADAWUL:2280
Almarai — Q1 2020 Earnings Presentation
37 slides from Almarai's earnings presentation, April 2020
Slide 1: Q1 2020 Earnings Presentation
Q1 2020 Earnings Presentation
Slide 2: Disclaimer
Slide 3: Contents
“abo Almarai Contents Market Dynamics Business Performance Financial Performance Capex, Capital Management & Share Performance — Q&A Appendix ru BA 7 i) _ a
Slide 4: Market Dynamics
WSQZ2— (ncholl Almarai Market. Dynamics Almarai® Q12020 Earnin
Slide 5: Almarai Response to Pandemic
AlmaraiResponseto = —_——~ Pandemic co Almarai to deliver “Quality you can trust” commitment to its consumers whilst being an integral part of the Nation’s food security and understanding that “Our responsibility is bigger”. o Proactively implementing all government guidance. o Protectourconsumers an
Slide 6: Emerging trends in response to Pandemic
Emerging trends in response to Pandemic a Spending on non-basic / discretionary categories to decline Food services category impacted by tourism and social distance practices GCC Border closure Spending affected by increase in un- employment Ability of Food service business to bounce back Q1 2020 Ea
Slide 7: COVID-19
COVID-19 —SS--—=™ o Weare aware and analysing seriously the consequences. o Weare taking all necessary actions under our control to protect our customers and our employees. o Weremain confident in the growth opportunities in our markets. o Wewill continue to invest behind our brands, ensuring we are
Slide 8: Almarai value share by category
Dec-19 Feb-20 Feb-20 Almarai Value Almarai Value Category Almarai Rank Share % Share % Laban 65 65 1 Fresh Milk 67 67 1 UHT Milk 21 19 2 Food 39 39 1 Juice 43 43 1 Bakery 54 52 1 Poultry (Fresh Chicken) 37 34 1
Slide 9: Business Performance
incholl Almarai Business Performance: Almarai®
Slide 10: 3,70 00% 00% 00% 3,50 0 25 00% 36 0 40 00% 3,30 0
3,70 0 300 52 0 30 00% 40 0 50 00% 38 0 45 00% 3,50 0 250 50 0 25 00% 36 0 40 00% 3,30 0 200 34 0 35 00% 48 0 20 00% 32 0 30 00% 3,10 0 150 46 0 15 00% 30 0 25 00% 28 0 20 00% 2,90 0 100 44 0 10 00% 26 0 15 00% 2,70 0 50 24 0 10 00% 42 0 50 0% 22 0 50 0% 2,50 0 - 40 0 0% 20 0 0% 60 0 0% 3,70 0 50 00
Slide 11: Q1 2020 Revenue Growth
+1 +4% in LC +SAR 55M Q1 2020 Revenue Growth (SAR Million) Others Total Revenue 341 3,592 % of Revenue 9% 100% Growth 19% 9% (7%) Q1 2020 Earnings Presentation +SAR 284M (9%) CnclhoJl Almarai 1
Slide 12: KSA growth of 8% contributed the most to topline
.. However KSA growth of 8% contributed the most to topline Total Revenue - SAR 3,592 Million Total Growth {SAR 284M (9%) 35% 16% 11% : - 8 | KSA UAE Oman Kuwait Bahrain Egypt Jordan Others Q1 2020 Earnings Presentation 12
Slide 13: Foods, Poultry & LL Dairy contributed the most to top line growth
Foods, Poultry & LL Dairy contributed the most to top line growth Total Revenue - SAR 3,592 Million Total Growth -(SAR 284M (9%) Cheese, Bakery Butter 2 12% 49% Cream 19% Poultry 16% a 18% 20% 5% ” oe | = ee | Fresh Dairy Long Life FruitJuice Cheese, Bakery Poultry Other Sales ife/ Dairy Butter & Lo
Slide 14: Modern Trade channel growth was a key highlight for the quarter
Modern Trade channel growth was a key highlight for the quarter Total Revenue - SAR 3,592 Million Total Growth {SAR 284M (9%) Traditional YoY %/(YOY%) Trade 54% Food Service 13% 16% 16% 4% Other/ — Exports (1%) 4% Modern Trade Traditional Trade Food Service Other / Exports Q1 2020 Earnings Presentat
Slide 15: ,0 8% 7% ,0 6% 9,00 5% 8,00 4% 3% 7,00 2% 6,00 0
11 ,0 00 8% 7% 10 ,0 00 6% 9,00 0 5% 8,00 0 4% 3% 7,00 0 2% 6,00 0 1% 5,00 0 0% 3,30 0 5% 4% 3,20 0 4% 3,10 0 3% 3,00 0 3% 2,90 0 2% 2,80 0 2% 2,70 0 1% 2,60 0 1% 2,50 0 0% 1,60 0 16 % 14 % 1,50 0 12 % 1,40 0 10 % 1,30 0 8% 6% 1,20 0 4% 1,10 0 2% 1,00 0 0%
Slide 16: Innovation focus continues to produce exciting products
Innovation focus continues to produce exciting products Go Scope: Go to Development: “money gate”, Go to Launch: Should the Idea be pursued? Can we commit fully to the Project? Arewe "| tolaunch? STAGE 1 6 STAGE 2 STAGE 3 STAGE 4 i 5 . ate Builda Gate Testing & Scoping 2 QgpusinessCase Perea 4 a Eau
Slide 17: Q1 2020
Q12020 Earnings Presentation
Slide 18: Q1 Financial Performance
Q1 Financial Performance Q1 2020 vs. Q1 2019 YoY %/(YOY%) Revenue * Stable Market growth for Fresh products however long life product market, including poultry 14.0% experiencing high growth due to COVID-19 impact * Maintain market leadership in all key categories * Food, Long life Dairy & Poultry r
Slide 19: Results by Segment - Q1 2020
Results by Segment - Q1 2020 Revenues by Segment (SAR Million) Dairy &Juice Dairy & F * Higher Long life Dairy & Food sales Juice L * Higher juice ingredient, feed & labour costs * Higher depreciation and losses from IDJ Poultry Maes Bakery euy * Volume led improved performance Others [ s 9.012020 =
Slide 20: Net Income by Segment
Net Income by Segment Basic EPS* (SAR) 0.34 0.39 5 336 3 ‘0 31 4 383 = Ye cc < G Q1 2019 Dairy & Juice Bakery Poultry Others Q1 2020 Net Sales Growth 8% 3% 12% 49% 9% Net Income Growth 1% 21% 72% 14% 14% Net Income % to Net Sales 11% 14% 13% na 11% ee troll Rinna ~ EPS - Earnings Per Share Q1 2020 E
Slide 21: Capex, Capital Management & Share Performance
Cnc icloll @ a O eX Almarai Capital Mawageprent share Performance 12020 Earnings Presentation
Slide 22: CAPEX continues to trend lower
CAPEX continues to trend lower Capital Investment 2015 to 2020 at™ 29% 30% SAR Million 3,986 2015 2016 2017 mu Net Cash Used in Investing Activities 2018 —-Investment as a % of Net Sales 11% 9% 2019 TTM Q1 2020 ° Capex cash spend continues to decline in line with current available capacity ° New Cap
Slide 23: Free Cash Flow
Free Cash Flow Free Cash Flow = SAR 2.4B OC’ AR 4.3B (0.4) Le : c 0.5 Bio Assets S = 1.4PPE . a : (0.8) 04 | a) 01 Cash 31 Mar 2019 Operating Cash Flow Working Capital | Dividend Others Cash 31 Mar 2020 (SAR 0. 3 Billion) > Q1 2020 TTM Free Cash Flow = SAR2.4B * OCF: SAR +4.3 Billion.........Busines
Slide 24: Net Debt and EBIT/EBITDA Margins trend
Net Debt and EBIT/EBITDA Margins tren Almarai leverage target is to reach 2.5x-2.7x Net Debt to EBITDA in the next 2-3 years Net Debt Trend EBIT and EBITDA Margins 3.2 pls 30x 29.7% 28.0% 27.7% 13,558 14351 Ta635 12,743 12,545 12,306 . 18.6% 17.2% 88.1% 82.2% 80.3% 2018 2019 2020 TTM 2018 2019 2020T
Slide 25: Debt Maturity Profile highlights average debt tenure at 4.27 Years
Debt Maturity Profile highlights average debt tenure at 4.27 Years... (SAR Billion) Debt Maturity by Age and Type 35 3.0 25 6.1 49% 2.0 15 1.0 0.5 0.0 UptolYr — 1-2 Yrs 23 Yrs 3-4Y's 45 Yrs >SYrs Banks m Govt/Semi Govt Inst. m Islamic Bonds Banks mm Govt/SemiGovtInst. ™ Islamic Bonds Total Wel,oll Q
Slide 26: Key Share Data
Key Share Data Q1 2020 Earnings Presentation Key Statistics for Almarai (31 MAR 2020) = Savola Year to date total shareholder's return since listing 30% Share Price (SAR) 47.00 25% | m HHPrince Sultan Current P/E Ratio (ttm) 25.00 bin Mohammed we 13% 13% Earnings Per Share (SAR) (ttm) 1.88 = PIF tom
Slide 27: Cash Dividends Since Listing
Cash Dividends Since Listing csarminion 900 850 850 800 750 690 720 600 600 518 518 500 500 460 400 381 300 272 200 200 100 0 0 2005 2006 2007 2008 2009 2010 = 2011 2012, 2013) 2014S 2015. 2016S 2017-—S- 2018 = 2019 Q1 2020 Earnings Presentation 27
Slide 28: Key Takeaways
\W CnchoJl Almarai Key Takeaways Almarai® Q12020 Earnings Presentation
Slide 29: Key takeaways
Key takeaways o Safety of our customers and employees remain our number 1 priority and we are working round the clock to ensure that. o Almarai is developing multiple scenarios for future operations, depending on recovery speed of Corona Virus containment and expected changes in economic output. o Q
Slide 30: Appendix
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Slide 31: All categories recorded positive results
All categories recorded positive results Revenue By Geography - SAR Million Revenue By Category - SAR Million ! Be = : Bakery ! ! Ce a | 7 | ! 12% | : Poultry” I ! ! ! ! ! ! 1 Q12019 Q1 2020 I To, Q12019 Q1 2020 H 1 18% : Long Life i pono I other Sales f 3% I Dairy \enestacoene od KSA “ - 1 0% h nL
Slide 32: ,0 8% 7% ,0 6% ,0 5% ,0 4% ,0 3% 10 ,0 00
15 ,0 00 8% 7% 14 ,0 00 6% 13 ,0 00 5% 12 ,0 00 4% 11 ,0 00 3% 10 ,0 00 2% 9,00 0 1% 8,00 0 0%
Slide 33: Profit & Loss Statement - Q1
Profit & Loss Statement - Q1 2 SAR Million ist Quarter 2019 2020 Change Revenue 3,309 100.0% 3,592 100.0% 8.6% Cost of sales (2,145) (64.8%) (2,339) (65.196) (9.1%) Gross Profit 1,164 35.2% 1,253 34.9% 771% Selling and Distribution Expenses (565) (17.1%) (612) (17.0%) (8.3%) General and Administrati
Slide 34: Balance Sheet - Q1 2020
Balance Sheet - Q1 2020 SAR Million Q1 2019 Q1 2020 Year on Year Amount % Net Operating Working Capital 2,871 3,318 447 16% Property, Plant and Equipment 23,271 23,087 (184) (1%) Biological Assets 1,369 1,386 17 1% Net Operating Assets 27,511 27,791 280 1% Goodwill and Other Assets 1,061 1,142 80 8%
Slide 35: Cash Flow Statement - Q1
Cash Flow Statement - Q1 20 Year on Year SAR Million Q1 2019 Q12020 Amount % Net Income before NCI 337 367 30 9% Zakat & Income Tax 21 (36) (57) na Depreciation/Amortization 513 517 4 1% Working Capital (283) (600) (317) (112%) Other Income & Share of Associate 3 6 3 121% Employee benefits & Deferre
Slide 36: Results by Segment - Q1 2020
esults by Segment - Q1 2020 one : . Almarai Q1 2020 Revenue 2,520 433 558 81 3,592 Depreciation and Amortisation (328) (58) (95) (37) (517) Profit Attributable to Shareholders 272 59 73 (22) 383 Percent to Revenue of Profit Attributable to Shareholders 10.8% 13.7% 13.1% na 10.7% Growth versus Q1 201
Slide 37: Thank you
Thank you Q1 2020 Earnings Presentation