Nufarm Limited · ASX:NUF
Nufarm — FY2006 Earnings Presentation
41 slides from Nufarm's earnings presentation, Oct 2, 2006
Slide 1: Wi A -
Wi A -
Slide 2: Doug Rathbone, Managing Director
nN il Mh i NN Wisi iii Doug Rathbone Managing Director
Slide 3: Overview of results and strategy
| 2 (| Nufarm * All markets — ex Brazil — generated strong results against a background of ~ ‘patchy’ seasonal conditions ~ continued strong competition and ~ rising costs in some areas * Brazil is a challenge ... but longer term outlook remains positive = Our strategy is delivering
Slide 4: 2006 Full Year Headline results
a 2006 Full Year NAIL i Headline results 2006 Nufarm 2005 12 mths to July 31 Group revenues up 6.5% Operating profit down 0.6% Earnings per share Full year dividends up 15% Return on average funds employed 12 mths to July 31 : ' $1. 68 billion stat niton _ 60. 3 cents 30 cents . 118 8% $1.57 billion
Slide 5: Return on Average Funds Employed
boii % 20.0 19.0 18.0 17.0 16.0 15.0 14.0 13.0 12.0 Return on Average Funds Employed 2002 2003 2004 2005 2006 NX Nufarm
Slide 6: Kevin Martin, Chief Financial Officer
nN il Mh i NN Wisi iii Kevin Martin Chief Financial Officer
Slide 7: Business changes
Yi In Business changes | | Sale: = NZ Health & Science = CACI = Nuturf Purchase: =» Agrogen (Colombia) = Seeds businesses: > Dovuro/Nutrihealth (Canola) > Nugrain/Access Genetics (Wheat)
Slide 8: Accounting changes
Accounting changes «" AIFRS = Discontinued operations — P/L disclosures = Assets held for sale — balance sheet disclosures
Slide 9: Reported profit
a 2006 2005 Reported profit Discontinued operations Transfer significant items Total result LESS minority interest Nufarm Operating Material Total non-operating items 103,165 103,165 10,152 8,415 18,567 8.368 (8.368) 0 121,685 47 121,732 (579) (579) 121,106 47 121,153 121,660 3,385 125,045
Slide 10: Operating result excluding Agripec
YO Potortin Ber Nufarm 2006 2005 Operating result 121,106 121,660 LESS Agripec result (1,883) (26,905) Total result 119,223 94,755 Annual growth 26%
Slide 11: Profit reconciliation
a UL 2econciliatior pel AN i ll Nufarm Crop Equity Non Total Operating 2005 pre-tax profit 111.1 33.4 (14.2) 130.3 Equity of earnings (22.8) (22.8) Improvement in: -Australasia 4.4 4.4 »Europe 25.3 25.3 -Americas 11.2 11.2 Increases in unallocated costs (3.4) -3.4 increase in funding costs: >Brazil
Slide 12: Profit growth
0000000000000 Profit growth Methyls: Other: TOTAL Efficiency gains Cost reduction 6.9 5.8 12.7 12.6 25.3
Slide 13: Working capital
a we litt Kin AMINA Total working capital 2005 ADD Impact of acquisitions Increased receivables from sale of asset Increased FX hedge receivable Increased trade debtors Increased inventory Decreased payables TOTAL WORKING CAPITAL 2006 42 59 325 10 20 18 373 108 481
Slide 14: Doug Rathbone, Managing Director
nN il Mh i NN Wisi iii Doug Rathbone Managing Director
Slide 15: Sales by region
Yi Americas - 32% (2005 — 28%) Europe - 23% (unchanged) New Zealand - 3% (2005 — 4%) Australia — 38% Asia - 4% (2005 — 41%) (unchanged) Total sales - $1.68 billion
Slide 16: Australia
at Nufarm Australia «» Excellent summer crop sales « Strong gains in horticulture * ‘False start’ in WA * Overall margin expansion Regalis ~ bioregulator used for apple trees
Slide 17: New Zealand
a Nufarm Oa ee j New Zealand = Sales in line with '05 = Poor seasonal conditions =" Herbicides performed strongly Premium glyphosate formulation
Slide 18: Asia
Yn _Rosong ANU * 10% sales growth He Hy « Profit improvement on lower costs « Indonesia performing well i, Combination 2,4-D | glyphosate herbicide used in 'non-crop' (Japan)
Slide 19: United States
Sales up 20% Margin gains on product mix, pricing, efficiencies Glyphosate growth continues ‘Pipeline’ is full RazorBurn — differentiated glyphosate formulation aN Nufarm
Slide 20: Canada
Mili Canada * Pricing adjustments in overall market hee oa ay ASSERT. 6 ra « ‘Assert’ drives strong boost in sales/profit ae es Assert ~ selective grass herbicide
Slide 21: South America
i nN iii a ae South America «* Colombian acquisition exceeds expectations « Better product spread in Argentina « Registration delays in Chile Bispyrigen — herbicide used in rice (Colombia)
Slide 22: Europe
i lite a _4 \ Nufarm Europe « Sales growth in a declining market « Important additions to product portfolios « 'Methyls' restructure delivers major gains Flamenco — combination fungicide used in cereals (Germany)
Slide 23: Europe: France, Germany, UK
bil Re _ (aa Nufarm ill a vate Europe « France: Seasonal conditions limit opportunities « Germany: Sales up 15% =n « UK: Market share gains in branded products Sherpa — broad spectrum insecticide (France)
Slide 24: Brazil / Agripec: Market conditions
i iii Brazil / Agripec Market conditions = Compounding impact of currency appreciation ... « Industry wide implications =» Some volatility is inherent in developing growth markets =" Need to be risk averse
Slide 25: Brazil / Agripec: Market conditions
ii i) TM iiliti Brazil / Agripec Market conditions = Compounding impact of currency appreciation ... = Industry wide implications =» Some volatility is inherent in developing growth markets =" Need to be risk averse
Slide 26: Brazil / Agripec: operationally sound
Pion Nufarm a,c ~ = lst A Brazil / Agripec Agripec: operationally sound =» Expanding product range and good pipeline = Excellent production capabilities =» Strong management team; aligned with Nufarm’s approach to risk ; * egress management * _, Cultivande o Brasil. Rival — fungicide used for treatm
Slide 27: Brazil / Agripec: Ownership position
a a iti : \ Nufarm Brazil / Agripec Ownership position =» Experienced partner important in challenging times = Will move to 100% when time is ‘right’
Slide 28: Chemistry Biology
yO CHEMISTRY BIOLOGY $53 billion ©
Slide 29: Growth Platforms
ani i) NNN NN i) NN Hii MAI. oc aN i) “a a Nufarm Occ aT oy i. Growth Platforms Brian Benson Group General Manager - Agriculture
Slide 30: Key growth drivers
YO Nufarm Key growth drivers = Geography — Well advanced = Portfolio > Substantial growth opportunities
Slide 31: Emerging/expansion markets
a | Nufarm Emerging/expansion markets Eastern Europe: Expansion program underway Italy: New acquisition Mexico: Looking for opportunities India: Long term growth assured
Slide 32: Product pipeline
Yi | Nufarm Product pipeline « Steady increase in registration approvais = Increasing opportunities to ‘partner’ = Improved / diversified product mix will generate margin expansion
Slide 33: Product pipeline: USA
Yi | Nufarm Product pipeline: USA = Some 50 ‘projects’ underway — More ‘06 submissions than any other US registrant = Several key new product positions = Excellent returns from RTP lab investment
Slide 34: Insecticide opportunity
a | | Nufarm =» No 1 insecticide worldwide =" Nufarm has integrated — independent position » Will provide platform position in insecticide portfolio @ 2003 @ 2004 M2005 Sales $ millions
Slide 35: Insecticide product launch
INSECTICIDE POR CONTROL GF CERTAIN INSECTS: INFESTING VARIOUS CROPS. Ova KEEP OUT OF REACH GF CHILDREN CAUTION —CAUCION Successful product launch Extensive field trial program New formulations in development Seed treatment opportunities nA Nufarm
Slide 36: Registration status
a Nufarm Registration status = USA: 6 product registrations approved = Australia: 4 product registrations approved = Latin America: Product registrations in 5 markets = India: Product registration approved = Europe: Registration program underway
Slide 37: Seeds
Yi | Nufarm Seeds = Integrated approach: Germplasm — marketing =" Broad crop base with focus on canola = ‘Roundup Ready‘ deal = Additional opportunities will be available
Slide 38: Doug Rathbone, Managing Director
nN il Mh i NN Wisi iii Doug Rathbone Managing Director
Slide 39: Strong growth platform
a ii - "Tf OOK vo MDI. md Nufarm » Strong growth platform — Established global footprint with additional markets coming on line — Robust product pipeline — Attractive acquisition opportunities
Slide 40: Outlook
a a i fe) fe : Heo : A J Nufarm * Brazil remains uncertain » Sustainable growth in major established markets » Maintain average 10% p.a. net profit growth target
Slide 41: it yy Aas he,
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