Ricegrowers Ltd. Class B · ASX:SGLLV

Ricegrowers Ltd. Class B — Investor Presentation (June 2018)

32 slides from Ricegrowers Ltd. Class B's investor presentation, June 2018

  1. Slide 1: ASX Proposal Information Sessions June 2018

    ASX PROPOSAL INFORMATION SESSIONS JUNE 2018

  2. Slide 2: Welcome

    WELCOME LAURIE ARTHUR CHAIRMAN 2

  3. Slide 3: Agenda

    AGENDA OVERVIEW VIDEO ASX PROPOSAL Laurie Arthur, Chairman Overview Rob Gordon, CEO NEXT STEPS QUESTIONS SESSION 2 Laurie Arthur, Chairman Questions and Answers Group Strategy and Need for Funding – Rob Gordon, CEO 3

  4. Slide 4: ASX Proposal

    ASX PROPOSAL ROB GORDON CEO 4

  5. Slide 5: Resourcing an exciting future

    RESOURCING SunRice is in a position of strength and ready to take the next step forward AN EXCITING   We are uniquely positioned to take advantage of global food trends to assist in delivering better farm gate returns and shareholder value FUTURE  Our strong growth agenda requires efficient acces

  6. Slide 6: A change in listing location, not structure

    ASX A CHANGE IN LISTING LOCATION, NOT STRUCTURE PROPOSAL THE BOARD IS RECOMMENDING WE RETAIN SUNRICE’S EXISTING STRUCTURE AND TRANSFER OUR LISTING OF B CLASS SHARES FROM THE NSX TO THE ASX, OPENING OUR B CLASS REGISTER TO ALLOW ALL INVESTORS TO BUY AND SELL B CLASS SHARES An ASX listing will allow n

  7. Slide 7: Why the ASX?

    WHY THE The ASX meets all our objectives for benefiting both A and B Class Shareholders, ASX?  as well as the business:  It’s the premier exchange for listed companies in our region, providing access to Australia’s largest pool of capital to fund our 2022 Growth Strategy  Investors on the ASX are

  8. Slide 8: Comparison of exchanges

    COMPARISON SUMMARY EXCHANGE METRICS1 OF EXCHANGES NSX ASX Market capitalisation A$4.8bn A$1,777bn No. of listed securities 81 2,239 No. of brokers 23 77 Average daily turnover ~A$62k2 A$4.2bn2 Average daily turnover relative to market capitalisation 0.001% 0.24% Capital raised ~A$115m A$52b NUMBER O

  9. Slide 9: Key components of an ASX listing

    KEY AN ASX LISTING WOULD COMPRISE THREE MAIN ELEMENTS: COMPONENTS OF AN ASX LISTING 1. 2. 3. A transfer of the B Removal of ownership An intended small Class Share listing restrictions from equity raising from from the NSX to the B Class Shares and new and existing ASX provision of shareholders prot

  10. Slide 10: 1. Transfer of B Class share listing

    1. TRANSFER OF B CLASS SHARE LISTING 10

  11. Slide 11: 1. Transfer of listing from NSX to ASX

    1. TRANSFER OF CURRENT STRUCTURE LISTING FROM A Class shareholders A Class Shares Voting / control rights NSX TO ASX Restricted to current growers B Class shareholders B Class Shares Traded through NSX Restricted to current or former Economic rights growers and employees/directors (5% cap) STRUCTURE

  12. Slide 12: 1. Core components

    1. CORE A CLASS SHAREHOLDERS COMPONENTS Class Existing arrangements Arrangements under ASX Proposal Class Existing arrangements Arrangements under ASX Proposal Board election ✓ Director election Board election ✓ Director election (Board remains majority grower directors) (Board remains majority grow

  13. Slide 13: 2. Removal of ownership restrictions from B Class shares and provision of protection rights

    2. REMOVAL OF OWNERSHIP RESTRICTIONS FROM B CLASS SHARES AND PROVISION OF PROTECTION RIGHTS 13

  14. Slide 14: 2. Key changes summarised

    2. KEY CHANGES If the ASX Proposal is implemented: SUMMARISED  B Class Shares would be listed on the ASX rather than the NSX  Ownership restrictions on B Class Shares will be removed and anyone can invest in SunRice B Class Shares, not just current and former growers and employees  The B Class sh

  15. Slide 15: 2. SunRice business and operations remain unchanged

    2. SUNRICE No change to SunRice’s corporate structure, governance or management BUSINESS AND   No change to day-to-day operations of SunRice Group OPERATIONS   No change to Paddy Pricing or Dividend Policies No change is required to the Board’s composition, however your Directors are proposing t

  16. Slide 16: 3. An intended small equity raising from new and existing shareholders

    3. AN INTENDED SMALL EQUITY RAISING FROM NEW AND EXISTING SHAREHOLDERS 16

  17. Slide 17: 3. Proposed equity raising

    3. PROPOSED IF THE ASX PROPOSAL IS SUCCESSFUL, IT IS THE BOARD’S CURRENT INTENTION TO CONDUCT A SMALL CAPITAL RAISING IN THE ORDER OF $20 - $30 MILLION EQUITY THE PRINCIPAL OBJECTIVES OF THE EQUITY RAISING WOULD BE TO: RAISING  Provide existing shareholders an opportunity to increase their investme

  18. Slide 18: Trading comparables: EV / FY18 EBITDA

    TRADING EV / FY18 EBITDA COMPARABLES 32.9x SunRice trades at a significant discount to its ASX peers on an enterprise value 17.6x 15.6x basis 15.0x 14.4x 9.4x 8.7x 8.2x 7.9x 7.4x Enterprise Value (EV) = 6.3x 5.3x Market Capitalisation (no. of shares x share price) + Net Debt (debt outstanding – cash

  19. Slide 19: Trading comparables: FY18 price to earnings ratio

    TRADING COMPARABLES FY18 PRICE TO EARNINGS RATIO (PER) 48.7x 34.2x SunRice trades at a significant discount 29.7x 28.5x to its ASX peers on an equity value basis 27.6x 20.1x 16.8x 13.8x 13.4x 12.3x 11.5x 5.0x Market Capitalisation (no. of shares x share price) PER = SunRice a2 Milk Select Costa Synl

  20. Slide 20: Trading comparables: FY18 dividend yield

    TRADING COMPARABLES FY18 DIVIDEND YIELD1 8.3% SunRice provides a significantly higher 4.8% dividend yield than its ASX peers 4.1% 4.1% 3.2% 2.8% 2.5% 1.9% 1.8% 1.6% FY18 dividend 0.0% -% Dividend = SunRice Inghams Fonterra Tassal Ridley Graincorp Huon Costa Select Bega a2 Milk Synlait yield Current

  21. Slide 21: Advantages of an ASX listing

    ADVANTAGES A Class grower shareholder control1 retained (including in relation to change of control) OF AN ASX   Improved access to a deeper pool of capital to better support growth initiatives designed to increase grower and shareholder returns, to the benefit of both A and B shareholders and the

  22. Slide 22: Disadvantages of an ASX listing

    DISADVANTAGES Possible increased cost of entry for A Class shareholders, with the requirement to hold a OF AN ASX  minimum of 3000 B Class Shares Divergence of interests between B Class shareholders and A Class shareholders over time, as LISTING  the proportion of B Class shareholders with no rice

  23. Slide 23: Next steps

    NEXT STEPS LAURIE ARTHUR CHAIRMAN 23

  24. Slide 24: Next steps

    NEXT STEPS THE ASX PROPOSAL WILL BE PRESENTED TO SHAREHOLDERS FOR A VOTE AT THE TIME OF THE SUNRICE AGM, WHICH WILL BE HELD ON 20 SEPTEMBER 2018  Special resolutions (75%) of both A Class shareholders and B Class shareholders will be required to implement the ASX Proposal  An Explanatory Booklet a

  25. Slide 25: High level timeline

    HIGH LEVEL TIMELINE JUNE-SEPT LATE JULY AUGUST 20 SEPT Information sessions, Explanatory Booklet, Shareholder A and B Class website, shed IER and shareholder meetings shareholder vote meetings, hotline documentation issued 25

  26. Slide 26: Questions

    QUESTIONS 26

  27. Slide 27: Your questions and feedback

    YOUR QUESTIONS AND FEEDBACK SUNRICE.COM.AU/ASX

  28. Slide 28: Summary of material changes

    SUMMARY OF MATERIAL CHANGES KEY MATERIAL RIGHTS AND VOTING CHANGES FOR A AND B CLASS SHAREHOLDERS* RIGHT EXISTING ARRANGEMENTS ARRANGEMENTS UNDER ASX PROPOSAL B Class ownership qualifications • Ownership of B Class Shares restricted to current or • Unrestricted ownership former growers or SunRice em

  29. Slide 29: Summary of material changes

    SUMMARY OF MATERIAL CHANGES KEY MATERIAL RIGHTS AND VOTING CHANGES FOR A AND B CLASS SHAREHOLDERS* RIGHT EXISTING ARRANGEMENTS ARRANGEMENTS UNDER ASX PROPOSAL Related party transactions • A Class approval (50%) may be required • A and B Class approval (50%) may be required • No B Class vote required

  30. Slide 30: Trading comparables: EV / FY18 EBIT

    TRADING EV / FY18 EBIT COMPARABLES 33.3x 22.3x 22.2x 21.4x SunRice trades at a significant discount 18.9x to its ASX peers on an enterprise value basis 15.6x 13.9x 12.7x 10.1x 9.7x 9.2x 7.8x Enterprise Value (EV) = Market Capitalisation (no. of shares x share price) + Net Debt (debt outstanding – ca

  31. Slide 31: Trading comparables: market capitalisation of ASX listed comparables

    TRADING CURRENT MARKET CAPITALISATION OF ASX LISTED COMPARABLES (A$M) COMPARABLES 8,706 There has been a number of recent listings that have grown the representation of food and agri-stocks 2,337 on the ASX 1,888 1,701 1,464 1,334 719 679 598 420 410 a2 Milk Costa Graincorp Synlait Inghams Bega Font

  32. Slide 32: Thank you

    THANK YOU PLEASE JOIN US FOR REFRESHMENTS SUNRICE.COM.AU/ASX 32

Ricegrowers Limited (SunRice) — Investor Presentation (June 2018) on 6ix