Rusagro Group · RUS:RAGR
Rusagro — Ros Agro — Investor Presentation (October 2020)
40 slides from Rusagro's investor presentation, October 2020
Slide 1: Investors Presentation
INVESTORS PRESENTATION ROS AGRO PLC October 2020 20 November 2018 1
Slide 2: Disclaimer
DISCLAIMER IMPORTANT: You must read the following before continuing. The following applies to this document, the oral presentation of the information in this document by ROS AGRO PLC (the “Company”) or any person on behalf of the Company, and any question-and-answer session that follows the oral pre
Slide 3: Content
CONTENT ROS AGRO OVERVIEW…………….…..…..4 ROS AGRO BY SEGMENT….………….…10 ADDITIONAL INFORMATION…………..27 CONTACTS………………………………….….40 3
Slide 4: Ros Agro Overview
ROS AGRO OVERVIEW WZ ROS AGRO "ith =~PLC
Slide 5: Company Overview
COMPANY OVERVIEW RUSAGRO IS A LEADING AGRICULTURAL COMPANY IN RUSSIA WITH A 25-YEARS HISTORY AND CONTINUED GROWTH HIGHLIGHTS 2019 KEY GROWTH DRIVERS SALES Adj. EBITDA 138 RUB billion 20 RUB billion 1 Vertically integrated and diversified 2 State-of-the-art facilities with strategically 3 Strong bran
Slide 6: Business Segments
BUSINESS SEGMENTS RUSAGRO IS REPRESENTED BY FIVE BUSINESS DIVISIONS WITH TOP POSITIONS AMONG RUSSIAN PRODUCERS AND WELL-RECOGNIZED BRAND PORTFOLIO BUSINESS SEGMENT POSITION IN RUSSIA PRODUCTS BRANDS sunflower oil consumer • №1 producer Russia in №1 margarine producer in Russia • Vegetable oil Meal 5
Slide 7: Company by Segment
COMPANY BY SEGMENT IN 2020 OIL&FAT BUSINESS CONTINUED TO GROW ITS SHARE IN RUSAGRO’S SALES AND EBITDA REACHING 46% AND 34% RESPECTIVELY, WHILE MEAT, AGRICULTURE AND SUGAR SEGMENTS SHARING THE REST OF THE RETURNS SALES STRUCTURE AVERAGE EMPLOYEE HEADCOUNT as % of total before intersegment adjustments
Slide 8: Business Model
BUSINESS MODEL RUSAGRO’S BUSINESS IS BASED ON EFFICIENT AND STABLE CLUSTER-ORIENTED BUSINESS MODEL BENEFITING FROM SCALE, VERTICAL INTEGRATION AND DIVERSIFICATION MEAT SEGMENT SUGAR SEGMENT 8
Slide 9: Geographical Presence
GEOGRAPHICAL PRESENCE ASSETS OF THE COMPANY ARE LOCATED IN 14 CONSTITUENT ENTITIES OF THE RUSSIAN FEDERATION WITH SUGAR, MEAT AND AGRICULTURE DIVISIONS PRIMARILY LOCATED IN THE CENTRAL RUSSIA AND OIL&FAT DIVISION – IN URAL 9
Slide 10: Ros Agro by Segment
WZ ROS AGRO "ith =~PLC ROS AGRO BY SEGMENT 10
Slide 11: Meat Russian Market Overview
MEAT RUSSIAN MARKET OVERVIEW PORK PRODUCTION PORK TRADE IN RUSSIA Slaughtered weight, million tonnes Thousand tonnes • In 2019, Russia increased production of pork by 5% to Farms enterprises & private farms Export Import 3.9 million tonnes in slaughtered weight. Output of Ряд 3 farms enterprises and
Slide 12: Meat Segment Operational Results
MEAT SEGMENT OPERATIONAL RESULTS IN 9M 2020 BOTH LIVESTOCK AND MEAT PRODUCTS SALES VOLUME INCREASED AS A RESULT OF PRODUCTION GROWTH, FACING WITH PRICE IMPROVEMENT IN 3Q 2020 LIVESTOCK SALES Pigs sales volume, ths t in live weight Sales price of pigs, RR/kg, excl. of VAT In 3Q 2020 volume of pork in
Slide 13: Meat Segment Financial Results
MEAT SEGMENT FINANCIAL RESULTS FOLLOWING RISING SALES MEAT DIVISION INCREASED ITS ADJ. EBITDA FOR 6M 2020 BY 36% Y-O-Y SALES Billion roubles +42% In 3Q 2020 in comparison to the same +15% +23% +25% period of 2019 sales of Meat segment increased by 23% to up to RUB 8.8 25.8 billion. The growth is att
Slide 14: Meat Segment Strategy
MEAT SEGMENT STRATEGY REACHING FULL CAPACITY ON RECENTLY LAUNCHED PIG FARMS AND OPENING THE RUSSIAN FAR EAST PORK CLUSTER WITH FURTHER INCREASE OF PORK PRODUCTS SALES ARE KEY GROWTH TRIGGERS MID-TERM GOALS PORK PRODUCTION PIGS LIVESTOCK Pork in live weight, thousand tonnes Thousand pigs Launching ne
Slide 15: Oil&Fat Russian Market
OIL&FAT RUSSIAN MARKET HIGH YIELDS INCREASED OIL PRODUCTION IN RUSSIA AND ALLOWED EXPORT GROWTH, WHILE CHANGES ON LOCAL MARKET REGULATIONS LED TO PALM OIL IMPORT RISE CRUDE VEGETABLE OIL PRODUCTION CRUDE VEGETABLE OIL TRADE IN RUSSIA Million tonnes Million tonnes Export Import • In the 2018/2019 sea
Slide 16: Oil&Fat Russian Market – Key Players
OIL&FAT RUSSIAN MARKET – KEY PLAYERS IN 2019 RUSAGRO IMPROVED ITS POSITIONS ACROSS ITS ALL OIL-AND-FAT PRODUCTS AND ACHIEVED LEADING POSITIONS IN FOUR OUT OF FIVE PRODUCT CATEGORIES CRUDE SUNFLOWER OIL PRODUCERS INDUSTRIAL FATS PRODUCERS IN RUSSIA IN 2018/2019 SEASON IN RUSSIA IN 2019 % of crude sun
Slide 17: Oil&Fat Segment Operational Results
OIL&FAT SEGMENT OPERATIONAL RESULTS IN 9M 2020 BOTH B2C AND B2B OIL-AND-FAT PRODUCTS INCREASED IN SALES VOLUME AND ALL EXCEPT MEAL EXPERIENCED HIGHER AVERAGE PRICES B2C PRODUCTS SALES Margarine, ths t Price of margarine, RR/kg, excl. of VAT Mayonnaise, ths t Price of mayonnaise, RR/kg, excl. of VAT
Slide 18: Oil&Fat Segment Financial Results
OIL&FAT SEGMENT FINANCIAL RESULTS SALES VOLUMES GROWTH TRIGGERED SALES AND ADJ. EBITDA INCREASE WITH MARGINS IMPROVING SINCE ALL SOLPRO ASSETS WERE RENTED AND GENERATED EBITDA FOR THE BUSINESS SALES Billion roubles In 3Q 2020 in comparison to the same +262% period of 2019 sales of Oil & Fat segment
Slide 19: Oil&Fat Segment Strategy
OIL&FAT SEGMENT STRATEGY AFTER CAPACITIES EXPANSION THROUGH THE RENT OF SOLPRO ASSETS, RUSAGRO IS AIMED AT INCREASING CAPACITY UTILIZATYION AND SECURING TOP-MARKET POSITIONS MID-TERM GOALS RUSAGRO’S PRODUCTION VOLUMES, THOUSAND TONNES • STRENGTHEN POSITIONS AMONG Meal Crude oil Industrial fats Bottl
Slide 20: Sugar Russian Market
SUGAR RUSSIAN MARKET HIGH STOCKS LEVEL AND SUGAR OUTPUT IN 2019 DROVE THE PRICES TO ITS HISTORICAL LOWS, WHILE IN 2020 LOWER SUGAR PRODUCTION LEVEL IS EXPECTED WHICH PUSHES THE PRICES UP SUGAR PRODUCTION SUGAR TRADE IN RUSSIA Million tonnes Thousand tonnes Processed sugar beet volumes, million t • I
Slide 21: Sugar Segment Results
SUGAR SEGMENT RESULTS ADJ. EBITDA FOR 6M 2020 INCREASED DESPITE SALES DROP DUE TO CHEAPER SUGAR BEET USED FOR PRODUCTION OF SOLD SUGAR SUGAR SALES Sales volume, ths t Sales price, RR/kg, excl. of VAT 26.2 27.4 Sugar sales volumes in 3Q 2020 reduced 40.0 39.4 36.5 30.3 30.1 31.8 29.8 30.6 30.1 27.5 2
Slide 22: Sugar Segment Strategy
SUGAR SEGMENT STRATEGY INCREASE OF EXTRACTED SUGAR LEVEL, IMPROVED SUGAR BEETS STORAGE AND AUTOMOTISATION WILL BE THE KEY GROWTH DRIVERS MID-TERM GOALS KEY AUTOMATION AND INNOVATIONS INNIATIVES • SUGAR LOSS DECREASE THROUGH The Long-term Storage Programme The Raw Materials Management System THE LAUN
Slide 23: Agriculture Russian Market Overview
AGRICULTURE RUSSIAN MARKET OVERVIEW INCREASE OF CULTIVATED LAND AREA AND YIELD PER HECTARE OF ALL CROP TYPES LED TO GROSS YIELD GROWTH WHILE HIGH GRAIN DOMESTIC PRICES REDUCED EXPORT VOLUMES TOP-4 LANDHOLDERS, 2018 CROPS HARVEST GRAINS AND OIL CROPS EXPORT Thousand hectares Million tonnes Million to
Slide 24: Agriculture Segment Operational Results
AGRICULTURE SEGMENT OPERATIONAL RESULTS GRAIN CROPS SALES Corn, ths t Price of corn, RR/kg, excl. of VAT Barley, ths t Price of barley, RR/kg, excl. of VAT Wheat, ths t In 3Q 2020 sales volume of grains Price of wheat, RR/kg, excl. of VAT 15.0 12.6 13.9 dropped by 28% to up to 252 ths tonnes, 10.1 1
Slide 25: Agriculture Segment Financial Results
AGRICULTURE SEGMENT FINANCIAL RESULTS SALES AND ADJ. EBITDA DECREASED IN 6M 2020 AS A RESULT OF LOWER SALES VOLUMES IN COMPARISON TO 1H 2019, WHEN SALES VOLUME WERE HIGH DUE TO HIGH YEAR-END STOCKS SALES Billion roubles In 3Q 2020 in comparison to the +85% same period of 2019 sales of +24% Agricultu
Slide 26: Agriculture Segment Strategy
AGRICULTURE SEGMENT STRATEGY GROWTH OF HIGHLY-EFFICIENT ARABLE LAND, IMPROVED SUGAR BEET HYBRIDS AND PRECISE FIELD MANAGEMENT SYSTEMS ARE THE KEY GROWTH DRIVERS MID-TERM GOALS KEY AUTOMATION AND INNOVATIONS INNIATIVES Sugar Beet Genetic Selection Centre In order to digitalise the strategic • OPTIMIS
Slide 27: Additional Information
WZ ROS AGRO "ith =~PLC ADDITIONAL INFORMATION 27
Slide 28: Net Revenue, Adjusted EBITDA: 2Q 2020 vs 2Q 2019
NET REVENUE, ADJUSTED EBITDA: 2Q 2020 VS 2Q 2019 COMMENTS NET REVENUE (IFRS) AND ADJ. EBITDA Net Revenue increased by RR 952 million (+3%): Net revenue (IFRS) Q2 2020 vs Q2 2019 • Revenue of Sugar segment decreased by RR 2,121 million (- 19%) due to volume reduction and price drop 184 38 302 2 778 3
Slide 29: Net Revenue, Adjusted EBITDA: 6M 2020 vs 6M 2019
NET REVENUE, ADJUSTED EBITDA: 6M 2020 vs 6M 2019 COMMENTS NET REVENUE (IFRS) AND ADJ. EBITDA Net revenue (IFRS) Actual 6M 2020 vs Actual 6M 2019 Net Revenue increased by RR 5,916 million (9%): 72 000 5 503 408 71 236 • Sugar sales decreased by RR 1,405 million (-9%) due to sale (13) price drop, comp
Slide 30: Statement of Comprehensive Income (IFRS)
STATEMENT OF COMPREHENSIVE INCOME (IFRS) ROS AGRO PLC RR m illion Varianсes Varianсes Description Actual 6M 2020 Actual 6M 2019 Q2 2020 Q2 2019 Units % Units % Sales 71,236 65,320 5,916 9 38,302 37,349 953 3 Net gain / (loss) on revaluation of biological assets and (381) (3,911) 3,530 90 (467) (1,95
Slide 31: Debt Profile
DEBT PROFILE (AS OF 30 2020) COMMENTS DEBT POSITION, LIQUIDITY MANAGEMENT AND FINANCE INCOME Gross debt decreased by RR 9,067 million (-9%) up to RR 88,809 million Debt position and liquidity management Variance • Net debt decreased by RR 10,120 million (-16%) to RR 51,620 million as a result of tda
Slide 32: Statement of Financial Position: Key Changes
STATEMENT OF FINANCIAL POSITION: KEY CHANGES 30 JUNE 2020 VS 31 DECEMBER 2019 COMMENTS ASSETS AND LIABILITES & EQUITITY ASSETS • PPE & LT biological assets* increased by RR 762 million (RR +1,236 million in Meat, RR -622 Assets as of 30 June 2020 vs 31 December 2019 million in Sugar, RR -190 million
Slide 33: Cash Flows: 6M 2020 vs 6M 2019
CASH FLOWS: 6M 2020 vs 6M 2019 CASH FLOWS ACCORDING TO MANAGEMENT VIEW COMMENTS (NOT IFRS PRESENTATION)** RR m illion Actual Actual Variances Main variances in cash flow statement line items between 6M20 and 6M19: 6M 2020 6M 2019 Units % Cash flow s from operating activities Net cash from operating
Slide 34: Adjusted EBITDA 6M 2020 (IFRS) Breakdown by Divisions
ADJUSTED EBITDA 6M 2020 (IFRS) BREAKDOWN BY DIVISIONS ROS AGRO PLC RR million Six months ended 30 June 2020 Sugar Meat Agriculture Oil and Fat Other Elimination Total Sales 14 269 14 079 7 670 34 444 2 108 -1 334 71 236 Net gain / (loss) on revaluation of biological assets and agricultural 0 320 -1
Slide 35: Adjusted EBITDA 6M 2019 (IFRS) Breakdown by Divisions
ADJUSTED EBITDA 6M 2019 (IFRS) BREAKDOWN BY DIVISIONS ROS AGRO PLC RR million Six months ended 30 June 2019 Sugar Meat Agriculture Oil and Fat Other Elimination Total Sales 15 674 11 169 9 157 28 941 1 987 -1 608 65 320 Net gain/ (loss) on revaluation of biological assets and agricultural 0 -256 -2
Slide 36: Statement of Cash Flows According to Management View
STATEMENT OF CASH FLOWS ACCORDING TO MANAGEMENT VIEW (NOT IFRS PRESENTATION) ROS AGRO PLC RR m illion Variances Actual Actual 6M 2020 6M 2019 Units % Cash flows from operating activities Profit before income tax 8,483 2,643 5,841 221 Adjustments for non-cash and non-operating (income)/expenses, net:
Slide 37: Statement of Cash Flows – Continuance
STATEMENT OF CASH FLOWS ACCORDING TO MANAGEMENT VIEW (NOT IFRS PRESENTATION) – CONTINUANCE ROS AGRO PLC RR m illion Actual Actual Variances 6M 2020 6M 2019 Units % (*) Including in net Cash flows from investing activities - cash flows on financial Purchases of property, plant and equipment (4,016) (
Slide 38: Statement of Financial Position (IFRS)
STATEMENT OF FINANCIAL POSITION (IFRS) ROS AGRO PLC RR m illion 31 Decem ber Variances 30 June 2020 2019 Units % ASSETS 235,303 239,495 (4,192) -2 Current assets Cash and cash equivalents 3,224 2,171 1,054 49 Restricted cash 0 0 0 13 Short-term investments 23,499 23,457 42 0 Trade and other receivab
Slide 39: Statement of Financial Position (IFRS) – Continuance
STATEMENT OF FINANCIAL POSITION (IFRS) – CONTINUANCE ROS AGRO PLC RR m illion 31 Decem ber Variances 30 June 2020 2019 Units % Liabilities and EQUITY 235,303 239,495 (4,192) (2) Current liabilities Short-term borrow ings 25,102 31,835 (6,733) (21) Lease liabilities 841 917 (75) (8) Trade and other p
Slide 40: Contacts
CONTACTS Svetlana Kuznetsova Head of Investment Department E-mail: [email protected] Tel.: +7 (495) 363-1661 www.rusagrogroup.ru/eng 40