Nufarm Limited · ASX:NUF
Nufarm — H1 2010 Earnings Presentation
26 slides from Nufarm's earnings presentation, Mar 30, 2010
Slide 1: Interim Results, 6 months to January 31, 2010
For personal use only Interim Results 6 months to January 31, 2010 30 March, 2010
Slide 2: Doug Rathbone, Managing Director
For personal use only Doug Rathbone Managing Director
Slide 3: 2010 Interim results – key drivers
2010 Interim results – key drivers For personal use only Pricing and margin pressure in Brazil Climatic conditions dramatically reduce first half sales opportunities Additional glyphosate impacts 3
Slide 4: 2010 Interim results - Summary
2009 Interim results - Summary For personal use only 1H 2010 1H 2009 $m $m Group Sales 890 1,235 Operating EBIT (35.6) 120.2 Operating NPAT (4.2) 65.2 Material items (35.8) 0.5 Reported result (40.0) 65.7 4
Slide 5: Contrasting trading conditions
Contrasting trading conditions For personal use only 6 months to January 31, 2009 6 months to January 31, 2010 Glyphosate prices at near historic Glyphosate prices at historic lows highs Biggest summer crop in Australia 20-25% decline in Australian for 25 years summer crop plantings Wet Eu
Slide 6: Brian Benson, Group General Manager Agriculture
For personal use only Brian Benson Group General Manager Agriculture
Slide 7: Segment review – Australasia
2010 Interim results – Segment review For personal use only Six months in review - AUSTRALASIA 2010 1H 2009 1H Australia Australasia $m $m Dry spring; reduced summer crop Sales 295 342 plantings Segment profit 12.3 81.4 Fallow spraying underway in mid-late January with rains in north Very comp
Slide 8: Segment review – North America
2010 Interim results – Segment review For personal use only Six months in review - NORTH AMERICA 2010 1H 2009 1H United States North America $m $m Glyphosate inventory sold into Sales 216 357 distribution Segment profit 3 52 Cold, wet conditions delay ag segment sales Turf, ornamental, IVM and
Slide 9: Segment review – South America
2010 Interim results – Segment review For personal use only Six months in review - SOUTH AMERICA 2010 1H 2009 1H Brazil South America $m $m Significant pricing pressure affects key Sales 209 282 products Segment profit 0.25 (19) Growth in pasture segment Successful 'Nuprid' launch New GM in
Slide 10: Segment review – Europe
2010 Interim results – Segment review For personal use only Six months in review - EUROPE 2010 1H 2009 1H Market value down 10% 2009 v 2008 Europe $m $m France down by more than 15% Sales 170 255 Segment profit 19 28 Dry autumn and severe winter conditions reduce sales opportunities Europe New
Slide 11: Developments in Seeds
2010 Interim results For personal use only Developments in Seeds Acquisition of Richardson Seeds and MMR Genetics (August, 2009) Delivers market access and high quality germ plasm Acquisition of Druetto (Argentina) Completes platform to optimise breeding, production and operations between South
Slide 12: Glyphosate
Glyphosate End July 2009 For personal use only Destocking at distribution level; low seasonal demand; and additional Chinese imports result in high season-ending inventories in most markets Nufarm U.S. inventory written down to reflect pricing expectations August – December 2009 Prices fall lo
Slide 13: Glyphosate
Glyphosate For personal use only Is and will remain the industry's largest and most important chemistry A sustainably profitable position for suppliers such as Nufarm will require: Secure and cost competitive position on key raw materials Market access Product quality; technical and marketing su
Slide 14: Kevin Martin, Chief Financial Officer
For personal use only Kevin Martin Chief Financial Officer
Slide 15: Analysis of results
2010 Interim results For personal use only Analysis of results Segment $millions EBIT As per 2009 accounts 130 Translate at 2010 exchange rates <23> Restated 2009 results 107 Gross profit decrease <170> Expense reduction 34 Exchange gain/loss movement 48 As per 2010 accounts 19 15
Slide 16: Gross profit reduction
2010 Interim results For personal use only Gross profit reduction Glyphosate 123 All other 47 170 16
Slide 17: Material Items
2010 Interim results For personal use only Material Items $m Glyphosate adjustments (29.4) Restructuring costs (4.5) Due diligence costs (1.6) Net others (0.3) Total (35.8) 17
Slide 18: Working Capital
2010 Interim results For personal use only Working Capital $millions Jan '10 Jan '09 July '09 Receivables 899 1,044 787 Inventory 727 1,317 797 Payables <506> <805> <407> Net Working Capital 1,120 1,556 1,177 Change to January 2010 - <436> <57> 18
Slide 19: Net Debt
2010 Interim results For personal use only Net Debt $millions Jan '10 Jan '09 July '09 Net debt 1,032 1,571 938 Change to January 2010 - <539> 94 19
Slide 20: Sumitomo investment and outlook for full year
For personal use only Sumitomo investment and outlook for full year Doug Rathbone Managing Director
Slide 21: The Sumitomo investment
The Sumitomo investment For personal use only March 2: Nufarm shareholders approved a proposal by Sumitomo Chemical Company to proceed with a Tender Offer to acquire 20% of Nufarm Cash price: $14.00 per share Record date: March 12 Tender Offer runs from March 12 until April 9 Sumitomo has
Slide 22: The Sumitomo investment – Opportunities for strategic co-operation
The Sumitomo investment For personal use only Opportunities for strategic co-operation Companies are ranked 8th (Nufarm) and Areas of co-operation 9th (Sumitomo) in terms of global crop protection sales Sourcing, Virtually no overlap in product portfolio manufacturing, logistics Each company h
Slide 23: The Sumitomo investment – This strategic investment
The Sumitomo investment For personal use only This strategic investment Delivers some near term value for Nufarm shareholders Provides further opportunities that will facilitate Nufarm’s growth into additional product and crop segments and strengthen our position in a number of geographies 23
Slide 24: Outlook for 2010 full year result
Outlook for 2010 full year result For personal use only A clear path to profit recovery Glyphosate margins to strengthen; steps taken to secure market positions Major selling seasons now underway Excellent conditions in Australia Spring weather now evident in parts of North America and Europe
Slide 25: Outlook for 2010 full year result
Outlook for 2010 full year result For personal use only Forecast for 12 months Operating result : $110 million - $130 million Headline result : $80 million - $100 million Debt * : Approx $350 million Gearing * : 20-25% * After the impact of previously announced capital raising. 25
Slide 26: For personal use only
FOr pe! sone Se Oma ° “Focusedon _ the. business