Almarai Company · TADAWUL:2280
Almarai — Q3 2018 Earnings Presentation
26 slides from Almarai's earnings presentation, October 2018
Slide 1: Almarai Company Interim Results – 3rd Quarter 2018
Almarai Company Interim Results – 3rd Quarter 2018
Slide 2: Disclaimer
Disclaimer Information contained in this presentation is subject to change without further notice, its accuracy is not guaranteed and it may not contain all material information concerning the company. Neither we nor our advisors make any representation regarding, and assume no responsibility or lia
Slide 3: Macro Environment
Sa incl oll Almarai ~_ Macro Environment
Slide 4: Main Events Q3, 2018
Main Events Q3, 2018 • Growth in the quarter remained relatively flattish compared to the corresponding quarter due to contraction in the overall market and change in demographics • Market continues to be impacted by multiple reforms and macroeconomic changes • Good progress made against the strateg
Slide 5: Almarai Gaining Market Share Despite Declining KSA Dairy and Food Market
Almarai Gaining Market Share Despite Declining KSA Dairy and Food Market MAT Category Almarai MAT Value Almarai Rank • Almost all of the Dairy and Foods categories are Growth (Value) % Share Change (Value) declining in KSA in MAT August 2018 compared to PLAIN REGULAR LABAN -4.6% +0.7 1 MAT August 20
Slide 6: Business Highlights
Sa incl oll Almarai ~_ Business Highlights
Slide 7: Highlights
Highlights Revenue Operating Income 3.80 3.73 1.00 0.76 0.78 0.76 3.60 3.42 SAR in Billion 3.37 0.60 SAR in Billion 3.37 0.48 3.40 3.23 0.50 3.20 3.00 2.80 - Q3, 2017 Q4, 2017 Q1, 2018 Q2, 2018 Q3, 2018 Q3, 2017 Q4, 2017 Q1, 2018 Q2, 2018 Q3, 2018 2013 Last 5 Quarters Last 5 Quarters SAR 11.2 B +12.
Slide 8: Revenue Breakdown
Sa incl oll Almarai —~_ Revenue Breakdown
Slide 9: Revenue Analysis by Product – YTD Q3, 2018
Revenue Analysis by Product – YTD Q3, 2018 By Product 2017 By Product 2018 -1% +3% Poultry Poultry Bakery Bakery +1% 1,072 1,314 1,340 1,262 13% Cheese, 10% Other Sales Other Sales 13% 12% Butter & 119 Cheese, 164 Cream 1% Butter & 2% = 1,497 Cream 14% 1,480 SAR 10,517 14% SAR 10,334 Fruit Juice Mil
Slide 10: Revenue Analysis by Product – YTD Q3, 2018
Revenue Analysis by Product – YTD Q3, 2018 Growth Co nt rib ut io n o f Net Sales in SAR Million SAR in Million To t al % Gro wt h 2018 vs 2017 10,517 10,334 Fresh Dairy (407) (4%) ( YoY -9.3%) Cheese, Butter & Cream (18) (0%) ( YoY -1.2%) 42% 38% Bakery (78) (1%) ( YoY -5.8%) Poultry 242 2% 14% ( Y
Slide 11: Revenue Analysis by Country – YTD Q3, 2018
Revenue Analysis by Country – YTD Q3, 2018 By Geography 2017 By Geography 2018 Jordan 218 Bahrain = = +1% Bahrain Kuwait Jordan 250 Egypt 2% 233 Oman 530 Qatar Oman Egypt 209 554 5% 326 467 2% Export / = 555 Kuwait 577 2% 2% Export / Others 5% 3% 5% Others 163 UAE 5% 509 6% == = 192 UAE 2% 2% 1,039
Slide 12: Revenue Analysis by Country – YTD Q3, 2018
Revenue Analysis by Country – YTD Q3, 2018 Growth Co nt rib ut io n o f Net Sales in SAR Million SAR in Million 2018 vs 2017 To t al % Gro wt h KSA 16 0% 10,517 10,334 ( YoY +0.2%) UAE 0 0% ( YoY +0.0%) Oman 2 0% ( YoY +0.3%) Kuwait (20) (0%) 66% 68% ( YoY -3.9%) Egypt 110 1% ( YoY +23.5%) Qatar (32
Slide 13: Innovation Pipeline Q3, 2018
Innovation Pipeline Q3, 2018 Almarai Company 2018 Q3 Earnings Presentation 13
Slide 14: Financial Highlights
Sa incl oll Almarai ~_ Financial Highlights
Slide 15: Operating Performance – YTD Q3, 2018
Operating Performance – YTD Q3, 2018 Gross Profit Operating Income Profit Attributable to Shareholders % to Sales 40.4% 40.7% 0.3 pp 18.9% 19.3% 0.4 pp 15.9% 15.9% 0.0 pp SAR Million SAR Million SAR Million 4,248 4,211 1,985 1,995 1,669 1,639 -38 +11 -0.9% +0.5% -30 -1.8% YTD Q3, 2017 YTD Q3, 2018 Y
Slide 16: Statement of Income – 9 months and Q3, 2018
Statement of Income – 9 months and Q3, 2018 3rd Quarter YTD 3rd Quarter SAR million 2017 2018 Change 2017 2018 Change Revenue 3,373 10 0 .0 % 3,371 10 0 .0 % (0.1%) 10,517 10 0 .0 % 10,334 10 0 .0 % (1.7%) Cost of sales (1,857) (55.1%) (1,919) (56.9%) (3.3%) (6,268) (59.6%) (6,123) (59.3%) 2.3% Gros
Slide 17: Segment Reporting – 9 months and Q3, 2018
Segment Reporting – 9 months and Q3, 2018 Almarai SAR Million Dairy & Juice Bakery Poultry Other Activities Consolidated Q3 YTD 2018 Revenue 7,594 1,262 1,314 164 10,334 Depreciation and Amortisation (948) (189) (267) (142) (1,546) Profit Attributable to Shareholders 1,352 146 144 (2) 1,639 Percent
Slide 18: Net Income by Segment (9 Months)
Net Income by Segment (9 Months) Basic EPS* (SAR) 1.63 1.60 1,800 1,669 (199) 58 1,639 186 1,600 SAR Million (75) 1,400 1,200 1,000 YTD Q3, 2017 Dairy & Juice Bakery Poultry Other YTD Q3, 2018 Revenue Growth (4.9%) (5.8%) 22.5% 37.3% (1.7%) Net Income Growth (12.8%) (33.9%) n.a. 96.4% (1.8%) Net Inc
Slide 19: Investing Cash Flows continue the downward trend in line with revised 5 year Business Plan
Investing Cash Flows continue the downward trend in line with revised 5 year Business Plan CAPEX spend for the 3rd Quarter Year to Date 2018 was SAR 1.4 Billion. • Manufacturing and Farming spent CAPEX of SAR ~0.6 Billion for various capacity expansion projects. • Sales Depot, Poultry and Logistic
Slide 20: Cash Flow Bridge – Rolling 12 Months
Cash Flow Bridge – Rolling 12 Months YTD Q3,2018 Free Cash Flow = SAR 425M (SAR179M lower than 2017) 3,678 (771) (2,567) Loans Issues / Payments / Charges (746) 660 CAPEX / Biological 248 (5) Assets Operating Cash Flow Dividend Cash at 30 Others Cash at 30 Sept 2017 (SAR 412 Million) Sept 2018 Almar
Slide 21: Key Trends
Key Trends
Slide 22: Net Debt
Net Debt 14,000 350% 3.1x 3.1x 3.0x 12,000 2.8x 2.8x 2.7x 2.8x 300% 2.7x 2.7x 10,000 250% 8,000 200% SAR Million 6,000 150% 98% 101% 95% 4,000 75% 75% 74% 81% 81% 73% 100% 2,000 50% 6,653 8,237 8,053 8,762 9,344 10,889 10,883 10,910 13,275 0 0% 2011 2012 2013 2014 2015 2016 2016 2017 Last 12 Months
Slide 23: Quarterly Performance – Net Income Trend Analysis
Quarterly Performance – Net Income Trend Analysis 2018 versus 2017 800 Q2 = (2.0%) Q3 = (4.9%) 700 674 661 664 667 658 # 634 # 600 595 655 629 530 539 536 513 500 476 484 # 450 489 433 SAR Million Q1 = 4.8% 430 428 398 400 380 369 373 344 349 328 306 309 * 300 274 # 284 286 255 235 242 289 200 100 0
Slide 24: EBIT and EBITDA margins are starting to improve…
EBIT and EBITDA margins are starting to improve… Revenue, EBITDA and EBIT Evolution CAGR 2011 – 2018: 8.5% (w/o impact of acquisitions 4.4%) Net Sales EBIT % to Net Sales 14,699 14,339 EBITDA % to Net Sales 13,795 13,936 13,753 24.4% 12,606 29.3% 28.1% SAR Million 25.6% 11,219 25.3% 26.0% 24.2% 23.9
Slide 25: Key Share Data
Key Share Data Key Statistics for Almarai (30 September 2018) Year to date total shareholder's 30% return since listing Share Price (SAR) 49.90 Savola 25% Current P/E Ratio (ttm) 31.19 20% 16% 25% Earnings Per Share (SAR) (ttm) 1.95 HHPrince 15% 35% Market Cap (SAR Million) 49,900 Sultan bin 10% Moh
Slide 26: Thank you
For Investor Relations matters please contact: [email protected] “We will encourage our major corporations to expand across borders and take their rightful place in global markets” QR Code for Almarai IR App. www.almarai.com Thank you