Kernel Holding S.a. · GPW:KER
Kernel — Investor Presentation (April 2012)
31 slides from Kernel's investor presentation, April 2012
Slide 1: Kernel Holding S.A. Company presentation
Kernel Holding S.A. Co m pa n y p r e s e n tat i o n
Slide 2: Disclaimer
Disclaimer The information in this document has not been independently verified and no representation or warranty, expressed or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained herein. None of th
Slide 3: Company Overview
COMPANY OVERVIEW KERNEL
Slide 4: Kernel – leading agribusiness company in Ukraine
Kernel – leading agribusiness company in Ukraine №1 №1in Ukraine oilseed crusher oilseed crusher in Ukraine №1 bexporter №1 ulk sunflower oil in Ukraine №1 bulk sunflower bottled oil producer and marketer in Ukraine oil exporter in Ukraine №1 Leadingoil bottled and grain originator produ marketer
Slide 5: Value chain management business model
Value chain management business model Farming + Sourcing + Processing + Logistics + Distribution = added Kernel value 210 000 ha of farm land grain & oilseed origination 10 oilseed crushing plants 37 grain silos providing 3.8 Mio tons of agricultural FY2012 guidance fully cultivated from over 2 000
Slide 6: Strategy
Strategy Geographic focus Asset base Operational discipline Become the leading exporter of soft com- Focus on developing asset base in each Limit commodity open market positions modities in the Black Sea region segment to a target VaR < US$5m or 0.5% of total Lead the market consolidation in
Slide 7: Ukraine: undisputed world leader in production and export of sunflower oil
Ukraine: undisputed world leader in production and export of sunflower oil major producing countries, season 11/12 (projected) EU - 27 Russia Average sunflower 8.1 Mio tons 8.8 Mio tons seed yields (t/ha) sunflower seed production sunflower seed production 2.9 Mio tons 3.0 Mio tons sunflower oil pro
Slide 8: Ukraine: global leader in sunflower oil trade and major exporter of grain
Ukraine: global leader in sunflower oil trade and major exporter of grain Ukraine accounts for half Ukrainian sunflower oil exports of global sunflower oil export by destination, season 2010/2011 Ukraine is the world’s largest exporter of sunflower oil, accounting for half of global sunflower oil
Slide 9: FY2011 Contribution by operating segment
FY2011 Contribution by operating segment Revenue by segment (1) Operating profit by segment (2) (USD Mio / % of total revenue) (USD Mio / % of total operating profit) $54,7/2.7% $33,1/1.7% $26,6/1.3% $152,1/7.6% $571,2/28.6% $1 157,9/58.0% $1 899 $277,3 $165,8/55.7% $65,3/22% $24,5/8.2% $4,8/1.6% $1
Slide 10: FY2010 Contribution by operating segment
FY2010 Contribution by operating segment Revenue by segment (1) Operating profit by segment (2) (USD Mio / % of total revenue) (USD Mio / % of total operating profit) $112,6 / 10.2% $53,7 / 4.9% $71,8 / 39.5% $41,7 / 3.8% $24,9 / 13.7% $1 020 $400,7 / 36.5% $167,5 $22,2 / 12.2% $40,1 / 22.0% $24,7 /
Slide 11: Segmental Review
SEGMENTAL REVIEW KERNEL
Slide 12: Bottled oil segment
Bottled oil segment Kernel – leading bottled oil producer Bottled oil sales and marketer in Ukraine (% of total Ukraine market, Kernel estimate) Consolidated bottled oil sector Kernel and Bunge supply over 60% of bottled Other 29.0 % oil sold in Ukraine Kernel and Bunge only nationwide marketers o
Slide 13: Bulk oil segment
Bulk oil segment Crushing capacity Kernel – No1 oilseed crusher in Ukraine with (% of Ukraine capacity, Kernel estimate) 2.6 Mio tons/year sunflower seed crushing capacity Kernel 36.0 % Kernel – 36.0% estimated market share (percent of Ukraine total capacity) Other 44.0 % Main competitors: Cargi
Slide 14: Export terminals segment
Export terminals segment TransBulkTerminal (“TBT”) 2nd largest grain terminal in Ukraine, 4 Mio tons/year grain throughput capacity (20% of total Ukrainian grain throughput capacity) Located in Illichevsk, major Black Sea port and key gateway to international grain markets Owned and operated by Kern
Slide 15: Grain segment
Grain segment Leading grain supply chain operator in Ukraine with 10% market share of grain & oil-bearing Major grain exporters in season 10/11 (1) crops export in season 10/11 Kernel 9.0% Extensive and well-established origination base Origination effected directly at farm level through ibulon
Slide 16: Silo services segment
Silo services segment Largest private grain silo network in Ukraine with .3 Mio tons grain storage capacity 2 Strategic location of silos in key origination areas and close to Kernel crushing plants All silos connected to national railway network, allowing grain shipment to port by railcar 6 new sil
Slide 17: Farming segment
Farming segment Kernel in farming since 2002 Kernel farming acreage* 210 000 200 000 ha Prime location of farms in grain and sunflower belt 183 000 of Ukraine 150 000 Farms benefit from close location to Kernel grain silos and processing plants 2011 harvest to include sugar beet production for 100 0
Slide 18: Sugar production & marketing
Sugar production & marketing Ukraine market suffers from shortage of domestically pro- duced sugar Kernel sugar production platform Average yearly sugar consumption: 1.8-2.0 Mio tons 2nd largest sugar beet processing capacity in Ukraine: 4 sugar plants total 2 Mio tons/year sugar beet processing c
Slide 19: Geographical Expansion Opportunity: acquisition of Russian Oils
Geographical Expansion Opportunity: acquisition of Russian Oils Kernel signs SPA to acquire Russian Oils in August 2011 400 000 tons/year sunflower seed crushing capacity 100 000 tons oil refining and bottling capacity per year 3 plants located in Krasnodar and Stavropol regions, southern Russia
Slide 20: Financial Highlights FY2006 – FY2011
FINANCIAL HIGHLIGHTS FY2006 – FY2011
Slide 21: Income statement highlights FY2006 – FY2011
Income statement highlights FY2006 – FY2011 (1) Amounts in USD millions, except for EPS and margins FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 Revenue 215.2 350.4 663.1 1 047.1 1 020.5 1 899.1 EBITDA (2) 17.0 46.3 123.2 190.0 190.1 309.6 Result from operating activities (EBIT) 12.0 38.6 111.6 166.6 1
Slide 22: Balance sheet highlights FY2006 – FY2011
Balance sheet highlights FY2006 – FY2011 (1) Amounts in USD millions FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 Invested Capital Cash & cash equivalent 6.4 25.3 88.5 129.3 59.5 115.9 Net trade accounts receivable 9.1 9.8 48.7 32.4 65.5 111.6 Inventory 32.3 40.2 144.7 99.1 147.8 183.7 Of which: Readil
Slide 23: Cash flow highlights FY2006 – FY2011
Cash flow highlights FY2006 – FY2011 (1) Amounts in USD millions FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 Operating profit before working capital changes 16.6 45.4 116.1 188.2 205.7 275.2 Changes in working capital (35.9) (14.7) (210.2) (25.0) (97.3) (180.1) Cash obtained from/(used in) operations
Slide 24: Credit metrics FY2006 — FY2011
Credit metrics FY2006 — FY2011 (1) Amounts in USD million, except ratios FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 Gross interest-bearing debt 93.3 164.3 255.8 294.6 345.2 422.0 Cash 6.4 25.3 88.5 129.3 59.5 115.9 Net interest-bearing debt 86.9 139.0 167.3 165.3 285.7 306.1 Readily marketable invent
Slide 25: Financial highlights 1H FY 2012
Financial highlights 1H FY 2012
Slide 26: Income Statement Highlights
Income Statement Highlights (1) Amounts in USD millions, except for EPS and margins H1 FY2011 H1 FY2012 % change Revenue 912.4 985.9 8.1% Gross profit 206.7 218.9 5.9% Profit from operating activities 125.3 116.4 (7.1%) Net profit(2) 86.2 101.9 18.1% EBITDA (3) 141.3 148.6 5.2% EPS(4) 1.16 1.29 10.8
Slide 27: Balance Sheet Highlights
Balance Sheet Highlights (1) Amounts in USD millions 31 December 2010 30 June 2011 31 December 2011 Invested Capital Cash & cash equivalents 21.6 115.9 129.8 Net trade accounts receivable 127.7 111.6 116.1 Inventory 547.0 183.7 561.3 of which: readily marketable inventories(2) 538.9 168.3 531.3 Othe
Slide 28: Cash Flow Highlights
Cash Flow Highlights (1) Amounts in USD millions H1 2011 H1 2011 Operating profit before working capital changes 120.9 147.0 Changes in working capital (501.0) (175.4) Cash used in operating activities (380.1) (28.4) Finance costs paid (20.3) (25.2) Income tax paid (0.8) (1.0) Net cash used in opera
Slide 29: Liquidity Position & Credit Metrics
Liquidity Position & Credit Metrics (1) Amounts in USD millions, except ratios 31 December 2010 30 June 2011 31 December 2011 Cash 21.6 115.9 129.8 Inventory 547.0 183.7 561.3 of which: readily marketable inventories 538.9 168.3 531.3 RMI / Inventories 98.5% 91.6% 94.7% Gross interest‐bearing debt 7
Slide 30: Segmental Results
Segmental Results Revenue(1), USD million Operating profit(2), USD million Operating margin, % Tonnage(3) H1 FY11 H1 FY12 % change H1 FY11 H1 FY12 % change H1 FY11 H1 FY12 H1 FY11 H1 FY12 % change Bottled oil 71.8 123.5 72.0% 11.2 21.3 90.7% 15.6% 17.2% 61.4 78.2 27.3% Bulk oil 440.3 487.8 10.8% 54.
Slide 31: FY2012 Guidance
FY2012 Guidance Revenue of US$2,300 million EBITDA of US$370 million Net income of US$255 million 31