Omnia Holdings Limited · JSE:OMN

Omnia — H1 2014 Earnings Presentation

48 slides from Omnia's earnings presentation, November 2013

  1. Slide 1: Interim Results for the six months ended 30 September 2013

    Interim Results for the six months ended 30 September 2013 1

  2. Slide 2: Group at a glance

    Group at a glance MINING AGRICULTURE CHEMICALS 2

  3. Slide 3: Geographical scope

    Geographical scope Brazil Democratic Republic of Congo 7 Ethiopia 8 Kenya 9 Lesotho 10 Madagascar 11 Malaw 12 Mali 13° Mauri 1 2 3 4 Burkina Faso 5 6 16 Namibia 17 New Zealand 18 Sierra Leone 19 Senegal 20 South Africa 23 Tanzania 24 Uganda 25 Zambia 26 Zimbabwe A Mining A Agriculture A Chemicals

  4. Slide 4: Key Drivers Affecting Results

    Key Drivers Affecting Results • Good demand for mining commodities • Strong volume growth in mining explosives and mining chemicals • Weaker rand • Weaker global fertilizer prices • Unfavorable urea : ammonia ratio • Muted RSA manufacturing growth 4

  5. Slide 5: Key Financial Features

    Key Financial Features • Revenue up 25.7% to R7.5 billion • Profit for the period up 16.8% to R424 million • Operating margin down from 9.1% to 8.4% • Basic EPS up 16.7% to 637.0 cents per share • Dividend up 23.3% to 185 cents per share • Debt : Equity improves from 42.5 % to 35.7% 5

  6. Slide 6: Mining

    MINING

  7. Slide 7: Overview - Mining

    Overview - Mining 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2013 Revenue R 2.8 bn 37 R 2.0 bn R 4.4 bn Operating profit R 453 m 35 R 335 m R 735 m Operating margin 16.5% 16.7% 16.8% • Pressure on global mining commodity prices • Physical demand still good 7

  8. Slide 8: Commodity Prices - Energy

    Commodity Prices - Energy $ 140 $ 120 $ 100 $ 80 $ 60 $ 40 $ 20 $- Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 Brent Crude $/barrel Coal $/ton Uranium $/lb 8

  9. Slide 9: Commodity Prices - Metals

    Commodity Prices - Metals $ 2,000 $ 12,000 $ 1,800 $ 10,000 $ 1,600 Gold and Platinum $ 1,400 $ 8,000 $ 1,200 Copper $ 1,000 $ 6,000 $ 800 $ 4,000 $ 600 $ 400 $ 2,000 $ 200 $0 $0 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 Gold $/oz Platinum $/oz Copper $/ton 9

  10. Slide 10: Overview - Mining

    Overview - Mining 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2013 Revenue R 2.8 bn 37 R 2.0 bn R 4.4 bn Operating profit R 453 m 35 R 335 m R 735 m Operating margin 16.5% 16.7% 16.8% • Pressure on global mining commodity prices / Physical demand good • Strong volume growth in mining expl

  11. Slide 11: Agriculture

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  12. Slide 12: Overview - Agriculture

    Overview - Agriculture 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2013 Revenue R 2.7 bn 24 R 2.2 bn R 5.4 bn Operating profit R 122 m (35) R 187 m R 443 m Operating margin 4.5% 8.6% 8.2% • Crop prices at good levels 12

  13. Slide 13: Crop Prices - Rand

    Crop Prices - Rand 7,000 6,000 5,000 Rand / ton 4,000 3,000 2,000 1,000 - Soja beans Wheat White Maize 13

  14. Slide 14: Overview - Agriculture

    Overview - Agriculture 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2013 Revenue R 2.7 bn 24 R 2.2 bn R 5.4 bn Operating profit R 122 m (35) R 187 m R 443 m Operating margin 4.5% 8.6% 8.2% • Global crop prices at good levels • Global fertilizer prices under pressure • Selling prices increa

  15. Slide 15: Ammonia and Urea Price

    Ammonia and Urea Price $ 1,000 $ 900 $ 800 $ 700 $ 600 $ 500 $ 400 $ 300 $ 200 $ 100 $0 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 Urea Gran Ammonia 15

  16. Slide 16: Ammonia vs. Urea FOB Costs / kg N

    Ammonia vs. Urea FOB Costs / kg N 1.85 1.65 1.45 1.25 US cents per kg 1.05 0.85 0.65 0.45 0.25 0.05 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 NH3/kg N Urea/kg N 16

  17. Slide 17: Phosphate and Potash Prices

    Phosphate and Potash Prices $ 1,200 $ 1,000 $ 900 $ 1,000 $ 800 $ 700 $ 800 $ 600 MOP DAP $ 600 $ 500 $ 400 $ 400 $ 300 $ 200 $ 200 $ 100 $0 $0 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 DAP US Gulf MOP NW Europe 17

  18. Slide 18: Overview - Agriculture

    Overview - Agriculture 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2013 Revenue R 2.7 bn 24 R 2.2 bn R 5.4 bn Operating profit R 122 m (35) R 187 m R 443 m Operating margin 4.5% 8.6% 8.2% • Global crop prices at good levels • Global fertilizer prices under pressure • Urea : ammonia ratio

  19. Slide 19: Chemicals

    CHEMICALS

  20. Slide 20: Overview - Chemicals

    Overview - Chemicals 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2013 Revenue R 2.0 bn 15 R 1.8 bn R 3.7 bn Operating profit R 53 m 130 R 23 m R 53 m Operating margin 2.6% 1.3% 1.5% • Continued low activity levels in RSA manufacturing sector • Volumes on par with 2012 20

  21. Slide 21: Index of Physical Manufacturing Volumes - South Africa

    Index 100 105 110 115 120 125 85 90 95 80 Jan-06 Apr-06 Jul-06 Oct-06 Jan-07 Apr-07 Jul-07 Oct-07 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Seasonally adjusted Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 South Africa January 2006 – July 2013 Jul-12 Oct-12 Inde

  22. Slide 22: Overview - Chemicals

    Overview - Chemicals 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2013 Revenue R 2.0 bn 15 R 1.8 bn R 3.7 bn Operating profit R 53 m 130 R 23 m R 53 m Operating margin 2.6% 1.3% 1.5% • Improved performance • Continued low activity levels in RSA manufacturing sector • Volumes on par with 20

  23. Slide 23: Financial Overview

    “= FINANCIAL OVERVIEW

  24. Slide 24: Key Drivers of Revenue and Profits

    Key Drivers of Revenue and Profits • USD : rand exchange rate – Affects selling prices and material costs – Translation of earnings of foreign operations – Effects translation of US dollar denominated equity • Commodity prices – Affects selling prices and material costs • Volumes • Urea : Ammonia ra

  25. Slide 25: USD : ZAR Exchange rate - Average and Closing

    USD : ZAR Exchange rate – Average and Closing 11 F2013 – H1 F2013 Ave F2014 – H1 Ave R8.23 -18% R8.55 -15% Ave R9.83 -19% 10.5 10 R10.02 -8.6% 9.5 R9.23 -20% 9 8.5 R8.30 8 -12% R7.77 +5% 7.5 25

  26. Slide 26: Income statement - Rm

    Income statement - Rm 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2012 Revenue 7 499 26 5 967 13 432 RESTATED 2012 – IFRS change • ACOL - 50% subsidiary • no longer proportionally consolidated • now equity accounted • Restatement is immaterial Revenue Volumes Ave Price • Mining +37% +15%

  27. Slide 27: Income statement - Rm

    Income statement - Rm 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2012 Revenue 7 499 26 5 967 13 432 Cost of sales (5 912) 27 (4 659) (10 360) Gross profit 1 587 21 1 308 3 072 Gross profit % 21.2% 21.9% 22.9% • Mining chemicals reduced gross profit % – price reductions to support custome

  28. Slide 28: Income statement - Rm

    Income statement - Rm 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2012 Revenue 7 499 26 5 967 13 432 Cost of sales (5 912) 27 (4 659) (10 360) Gross profit 1 587 21 1 308 3 072 Other operating income 43 (39) 70 67 Administrative expenses (287) 6 (270) (671) LTIP costs (49) - (10) (73) Dis

  29. Slide 29: Operating margin / targets

    Operating margin / targets Target H1-2013 H1-2012 FY2013 Mining 15-16% 16.5% 16.7% 16.8% Agriculture 11-13% 4.5% 8.6% 8.2% Chemicals 4.5-5.5% 2.6% 1.3% 1.5% 29

  30. Slide 30: Income statement - Rm

    Income statement - Rm 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2012 Revenue 7 499 26 5 967 13 432 Cost of sales (5 912) 27 (4 659) (10 360) Gross profit 1 587 21 1 308 3 072 Other operating income 43 (39) 70 67 Administrative expenses (336) 20 (280) (744) Distribution expenses (640) 20

  31. Slide 31: Working capital components - Rm

    Working capital components - Rm 31

  32. Slide 32: Income statement - Rm

    Income statement - Rm 6 months 6 months 12 months % 30/9/2013 30/9/2012 31/3/2012 Revenue 7 499 26 5 967 13 432 Cost of sales (5 912) 27 (4 659) (10 360) Gross profit 1 587 21 1 308 3 072 Other operating income 43 (39) 70 67 Administrative expenses (336) 20 (280) (744) Distribution expenses (640) 20

  33. Slide 33: Segmental Performance - Revenue

    Segmental Performance - Revenue 8,000 7,000 6,000 5,000 R millions 4,000 3,000 2,000 1,000 0 Sept-09 Sept-10 Sept-11 Sept-12 Sept-13 Mining Agriculture Chemicals 33

  34. Slide 34: Segmental Performance - Revenue

    Segmental Performance - Revenue 16,000 14,000 12,000 10,000 R millions 8,000 6,000 4,000 2,000 0 half FY10 half FY11 half FY12 half FY13 half FY14 year year year year year Mining Agriculture Chemicals 34

  35. Slide 35: Segmental Performance - Operating profit

    Segmental Performance – Operating profit 700 600 500 400 300 R millions 200 100 0 Sept-09 Sept-10 Sept-11 Sept-12 Sept-13 -100 -200 -300 Mining Agriculture Chemicals 35

  36. Slide 36: Segmental Performance - Operating profit

    Segmental Performance – Operating profit 1,400 1,200 1,000 800 R millions 600 400 200 0 half FY10 half FY11 half FY12 half FY13 half FY14 year year year year year -200 -400 Mining Agriculture Chemicals 36

  37. Slide 37: Balance sheet - Rm

    Balance sheet - Rm 6 months 6 months 12 months 30/9/2013 30/9/2012 31/3/2013 Assets Non-current assets 3 928 3 485 3 714 Current assets 6 827 5 766 5 036 Inventories 3 835 3 026 2 892 Trade and other 2 992 2 740 2 144 receivables 10 755 9 251 8 750 • Non-current assets up R443m – capex on expansion

  38. Slide 38: Balance sheet - Rm

    Balance sheet - Rm 6 months 6 months 12 months 30/9/2013 30/9/2012 31/3/2013 Total equity 5 359 4 381 4 952 Deferred tax 294 250 293 Current liabilities 3 188 2 757 2 941 Net debt 1 914 1 863 564 10 755 9 251 8 750 Debt:equity 36% 43% 11% 38

  39. Slide 39: Debt : Equity Ratio - Interim reporting

    Debt : Equity Ratio – Interim reporting 6,000 100% 90% Debt and Equity R millions 5,000 80% Debt/Equity Ratio 70% 4,000 60% 3,000 50% 40% 2,000 30% 20% 1,000 10% 0 0% Sept-09 Sept-10 Sept-11 Sept-12 Sept-13 Net debt Equity Debt/Equity Ratio ADJ Debt/Equity Ratio 39

  40. Slide 40: Debt : Equity Ratio

    Debt : Equity Ratio 6,000 100% 90% Debt and Equity R millions 5,000 80% Debt/Equity Ratio 70% 4,000 60% 3,000 50% 40% 2,000 30% 20% 1,000 10% - 0% first half FY10 first half FY11 first half FY12 first half FY13 first half FY14 Net debt Equity Debt/Equity Ratio ADJ Debt/Equity Ratio 40

  41. Slide 41: Cash flow - Rm

    Cash flow - Rm 6 months 6 months 12 months 30/9/2013 30/9/2012 31/3/2013 Operating profit before dep / amort / non- 820 666 1 536 cash items Utilised by working capital (1 432) (1 247) (172) (612) (581) 1 364 Finance costs – net (56) (33) (82) Taxation paid (152) (51) (207) (Utilised by) / generated

  42. Slide 42: Market capitalisation - R billion

    Market capitalisation – R billion 42

  43. Slide 43: Prospects

    Vy © Year, of Adding Value PROSPECTS el 43

  44. Slide 44: H2 Outlook - Mining division

    H2 Outlook – Mining division • H2 volumes slightly higher than H1 • Weaker rand benefit • Operating margin in line with H1 • Continued strong performance 44

  45. Slide 45: H2 Outlook - Agriculture division

    H2 Outlook – Agriculture division • Crop prices at levels that favor planting • Expect good summer plantings except perhaps in dry North West region • Continued unfavorable urea ammonia ratio • Weak rand benefit • Stronger H2 • Not expect to reach operating margin target of 11-13% 45

  46. Slide 46: H2 Outlook - Chemicals division

    H2 Outlook – Chemicals division • Not expecting any improvement in RSA manufacturing activity • Full year volumes expected to be in line with FY2013 • Weak rand benefit • Full year Operating margin improvement in line with H1 • Progress towards but not expect to reach operating margin target of 4.5%

  47. Slide 47: H2 Outlook - Group

    H2 Outlook – Group • Well positioned for growth in Africa • Will deliver on 5 year plan – matures March 2014 • Developing next generation LTIP • Good performance overall expected for F2014 47

  48. Slide 48: Thank You

    THANK YOU WWW.OMNIA.CO.ZA 48

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