Wilmar International Limited · SGX:F34
Wilmar International — Q4 2008 Earnings Presentation
30 slides from Wilmar International's earnings presentation, Feb 27, 2009
Slide 1: Wilmar International Limited 4Q08 Results Briefing
WILMAR INTERNATIONAL LIMITED 4Q08 RESULTS BRIEFING 27 FEBRUARY 2009 1
Slide 2: Important Notice
IMPORTANT NOTICE Information in this presentation may contain 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 which may cha
Slide 3: Presentation Overview
PRESENTATION OVERVIEW • 4Q08 Financial Performance • Risk Management • Business Update • Questions & Answers 3
Slide 4: 4Q08 Financial Performance
4Q08 Financial Performance 4
Slide 5: Merger & Restructuring: Shareholding & Legal Completion
Merger & Restructuring Shareholding & Legal Completion 19.6% Kuok Group WHPL ADM Public 31.2% 48.2% 6.7% 13.9% 65.8% 100.0% 100% 100% 34.2% PGEO PPBOP KOG IPT Assets Pre-merger Legal Wilmar completion 8 May 07 24 May 07* 28 June 07 28 June 07 Shares issued 287 m 1,024 m 1,092 m 2,533 m 1,450 m (6,38
Slide 6: Merger & Restructuring – Accounting Treatment
Merger & Restructuring – Accounting Treatment Pooling of Interest Purchase Method Method Financial Pre-Merger PGEO PPBOP KOG IPT Qtr Wilmar 1Q07 Restated 2Q07 Restated 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 Included in consolidated results Note : 3Q07 is the first quarter with full financial effects of merge
Slide 7: Results Overview
Results Overview 4Q08 vs 4Q07 US$m U Revenue 5,826 - 10% Net profit 374 60% Earnings per share in US cents 5.9 60% (fully diluted) FY08 vs FY07 US$m U Revenue 29,145 77% Net profit 1,531 164% Earnings per share in US cents 24.0 87% (fully diluted) 7
Slide 8: Revenue
Revenue • 4Q08 vs 4Q07 Revenue Volume US$ million - revenue down 10% million MT - volume up 4% 35,000 32.7 36.0 - higher demand offset by lower 32.0 prices of 30,000 29,145 commodities. 24.8 28.0 25,000 24.0 • FY08 vs FY07 - revenue up 77% 20,000 20.0 - volume up 32% 15,000 16,466 16.0 - FY08 - high
Slide 9: Revenue by Business Segment
Revenue by Business Segment FY07 FY08 4.3% 4.0% 3.6% Plantations & 2.4% Plantations & Others palm oils mills Others palm oils mills 14.6% 14.5% Consumer Consumer products products 27.3% Oilseeds 51.4% 24.6% 53.3% & grains Palm & laurics Oilseeds Palm & laurics & grains * Before elimination of inter-
Slide 10: Net Profit
Net Profit US$’million 1,600 • 4Q08 vs 4Q07 1,531.0 - up 60% 1,400 - stronger performance from for palm & laurics, and 1,200 plantations. 1,000 • FY08 vs FY07 - up 164% 800 - volume growth, higher margins for most 600 580.4 segments, full contribution from merger with Kuok 400 Group and merger 373.6
Slide 11: Net Profit Excluding Non-operating Items
Net Profit Excluding Non-operating Items In US$ million 4Q08 4Q07 FY08 FY07 Net profit 373.6 234.0 1,531.0 580.4 Non-operating items : Biological assets fair value gains - (88.5) - (88.5) Share grant & share options charges 4.1 61.5 4.1 61.5 Changes in the fair value of derivatives embedded in conve
Slide 12: Profit Before Tax by Business Segment
Profit Before Tax by Business Segment US$' million 4Q08 4Q07 ∆ FY08 FY07 ∆ Merchandising & Processing 214.3 184.4 16% 1,235.3 443.2 179% Palm & laurics 155.7 101.2 54% 644.9 258.4 150% Oilseeds & grains 58.6 83.2 -30% 590.4 184.8 219% Consumer Products 26.5 46.6 -43% 75.4 105.4 -28% Plantations & Pa
Slide 13: Profit Before Tax Excluding Non-operating Items
Profit Before Tax Excluding Non-operating Items In US$ million 4Q08 4Q07 FY08 FY07 Profit before tax 360.9 365.8 1,789.3 829.8 Non-operating items : Biological assets fair value gains - (123.5) - (123.5) Share grant & share options charges 4.1 61.5 4.1 61.5 Changes in the fair value of derivatives e
Slide 14: Profit Before Tax by Business Segment
Profit Before Tax by Business Segment FY07 FY08 6.1% 7.6% 1.8% Associates 33.0% 4.0% Associates 35.4% Others Palm & laurics Others Palm & laurics 20.6% 17.9% Plantations & Plantations & palm oils mills palm oils mills 4.2% Consumer 13.4% products Consumer 23.6% products Oilseeds & grains 32.4% Oilse
Slide 15: (A) Plantations & Palm Oil Mills
(A) Plantations & Palm Oil Mills US$ million 4Q08 4Q07 ∆ FY08 FY07 ∆ Revenue 273.9 291.9 -6% 1,320.5 839.7 57% Profit before tax * 86.6 61.5 41% 326.7 161.3 103% Planted area (ha) 223,258 203,683 10% 223,258 203,683 10% Mature area harvested (ha) 141,407 129,729 9% 141,407 129,729 9% FFB production
Slide 16: Plantation Age Profile
Plantation Age Profile in hectares Average Age of Palm 31 Dec 2008 0 to 3 yrs 4-6 yrs 7 - 14 yrs 15 - 18 yrs >18 yrs Total Indonesia 75,911 21,356 38,183 15,980 9,375 160,805 Malaysia 4,379 9,176 26,185 18,382 4,331 62,453 Total planted area 80,290 30,532 64,368 34,362 13,706 223,258 % of total plan
Slide 17: (B) Merchandising & Processing - Palm & Laurics
(B) Merchandising & Processing - Palm & Laurics 4Q08 4Q07 ∆ FY08 FY07 ∆ Revenue (US$ million) 3,313 3,679 -10% 17,497 9,917 76% Sales volume (‘000 MT) 4,864 4,696 4% 19,433 13,989 39% Profit before tax 155.7 101.2 54% 644.9 258.4 150% (US$ million) Profit before tax per MT 32.02 21.54 49% 33.19 18.4
Slide 18: (C) Merchandising & Processing – Oilseeds & Grains
(C) Merchandising & Processing – Oilseeds & Grains 4Q08 4Q07 ∆ FY08 FY07 ∆ Revenue (US$ million) 1,778 1,993 -11% 8,063 5,260 53% Sales volume (‘000 MT) 3,660 3,505 4% 13,288 10,834 23% Profit before tax 58.6 83.2 -30% 590.4 184.8 219% (US$ million) Profit before tax per MT 16.01 23.74 -33% 44.43 17
Slide 19: (D) Consumer Products
(D) Consumer Products 4Q08 4Q07 ∆ FY08 FY07 ∆ Revenue (US$ million) 970 1,438 -32% 4,759 2,816 69% Sales volume (‘000 MT) 736 721 2% 3,062 1,783 72% Profit before tax 26.5 46.6 -43% 75.4 105.4 -28% (US$ million) Profit before tax per MT 35.97 64.65 -44% 24.64 59.09 -58% (US$/MT) • Pretax profit lowe
Slide 20: Low Gearing
Low Gearing As at As at US$ million 31 Dec 08 31 Dec 07 Debt/Equity (x) 0.25 0.52 - Net Debt 2,390 4,060 - Shareholders' funds 9,606 7,845 Adjusted Debt/Equity (x) 0.10 0.12 - Liquid working capital * 1,421 3,156 - Adjusted Net Debt 969 905 Interest coverage (x) # 7.6 6.0 * Liquid working capital =
Slide 21: Robust Funding & Strong Liquidity
Robust Funding & Strong Liquidity As at 31 Dec 08 US$ million Available Utilised Balance Credit facilities : Committed 1,834 1,654 180 Trade finance 8,494 3,336 5,158 Short term 1,011 294 717 Total credit facilities 11,339 5,284 6,055 Available cash (not pledged) 1,104 Total liquidity 7,159 • 63% of
Slide 22: Strong Cashflow
Strong Cashflow FY08 FY07 Operating cashflow (US$ million) 3,231 (1,025) Turnover days - Inventory 43 56 - Trade Receivables 16 21 - Trade Payables 14 16 • Strong operating cashflow from lower working capital requirements and turnover days. • Working capital requirements dropped following sharp fall
Slide 23: Key Indicators
Key Indicators FY08 FY07 Return on Average Equity 17.5% 13.3% Return on Average Capital Employed 15.8% 11.5% Return on Average Assets 9.2% 6.0% in US cents EPS (fully diluted) 24.0 12.8 NTA per share 88.7 61.3 NAV per share 150.4 122.9 in Singapore cents Dividends (interim & final) 7.3 2.6 23
Slide 24: Results Summary
Results Summary US$ million FY08 FY07 U Revenue 29,145 16,466 77% Net Profit 1,531 580 164% EPS in US cents (fully diluted) 24.0 12.8 87% US$ million 31 Dec 08 31 Dec 07 U Shareholders’ funds 9,606 7,845 22% NAV per share in US cents 150.4 122.9 22% Total Assets 17,869 15,507 15% Gearing 0.25x 0.52x
Slide 25: Risk Management
Risk Management 25
Slide 26: Risk Management
Risk Management Commodities Credit Risk Price Risk Risk Governance Structure Foreign Exchange Interest Rate Risk Risk 26
Slide 27: Risk Governance Structure
Risk Governance Structure Board-level Risk Management Committee (RMC) - Chaired by Lead Independent Director - Oversees ERC Independent - Reviews overall risk management guidelines/ Middle Office framework, policies & systems - Captures and - Reviews & approves enterprise risk limits/ measures Group
Slide 28: Business Update
Business Update 28
Slide 29: Looking Forward
Looking Forward • Uncertain economic conditions, financial crisis • Relatively resilient demand for staple food commodities, optimistic on Asia’s longer term demand growth • Growing in challenging times – Continue to invest in core and newer markets – Persist with efforts to drive cost efficiencies
Slide 30: Questions & Answers
Questions & Answers 30