IN INTE TERIM RIM R RES ESUL ULTS TS PRES PRESENT ENTATION TION FOR THE SIX MONTHS ENDED 31 MARCH 2018
AGENDA Business Overview – Page 3 / Slide 3 Industry Trends – Page 11 / Slide 20 The Period in Perspective – Page 15 / Slide 28 Financial Overview – Page 16 / Slide 30 Industry Matters – Page 22 / Slide 41 Outlook – Page 23 / Slide 43 Additional Information – Page 25 / Slide 47 2
BUSINESS OVERVIEW
BUSINESS OVERVIEW Results for the six months ended March 2018 are a significant improvement on the prior comparable period, which was one of the lowest reported profits in history Feed input costs reduced significantly due to lower maize prices on the back of a bumper maize crop for 2017 Supply and demand balance gave pricing support, imports during the period remained high but stable, whilst lower brine levels and industry cutbacks resulted in a firmer market Further improvements in on-farm poultry production efficiencies were recorded No further incidents of bird flu and related costs were experienced during the period 4
BUSINESS OVERVIEW Revenue 15% Profit before interest and tax Key ey 393% Fina Financ ncial ial Ind Indica icator tors Earnings per share @ 1 973 cps 460% Headline earnings per share 455% 5
BUSINESS OVERVIEW Feed Poultry Maize price significantly down Feeding cost decreased General market improvement Bird performance improvement Higher internal feed required Sales volumes up (3 contributors) Sales volumes up Average sales realisations up Rand per ton margin up No impact from HPAI (bird flu) Other Africa Higher profits – improved performance from all three countries 6
“ ”
POULTRY DIVISION - OVERVIEW Revenue - R million Operating profit - R million 900 6 000 800 836 5 481 5 000 700 4 456 600 4 000 500 3 000 400 2 000 300 200 1 000 100 22 - - 1H2017 1H2018 1H2017 1H2018 Revenue up 23% Operating profit up • • Broiler sales volumes up 12.6% Feed price down 11.2% • • Broiler sales realisations up 11.2% Selling price contribution • Net margin 15.2% 1H2017: 0.5% 8
POULTRY DIVISION - OVERVIEW Broiler feed prices decreased by 11.2%, after significantly lower raw material costs offset the implementation of a further enhanced feeding programme Improved broiler production efficiencies with a better feed conversion achieved on a new feeding programme resulting in a lower cost of feeding Broiler sales volumes increased by 12.6% (≈ 26 000 tons) due to increased placements, higher bird weights and sales out of stock offsetting lower brine levels Broiler sales realisations increased impacted by a change in the product offering due to the brine impact and recovery above inflationary costs on strong demand IQF sales realisations were higher as the lower priced 30% IQF was sold until January 2017 and then replaced with 15% brined IQF at a higher cost Additional Listeria counter-measures with increased costs of R9.7 million for the period 9
POULTRY DIVISION - OVERVIEW Product Mix 23% 23% 1H2017 1H2018 47% 204 887 Tons 230 710 Tons 51% 7% 7% Volume increase ≈ 12.6% 14% 14% 5% 3% 4% 2% 10 10
BROILER PRODUCTION PERFORMANCE 108% 106% 104% 102% 100% 98% 96% Key indicators base-lined to 100% in F2012 94% F2012 F2013 F2014 F2015 F2016 F2017 1H2018 Average daily gain Slaughter age Live weight 11 11
BROILER PRODUCTION PERFORMANCE 140% 135% 130% 125% 120% 115% 110% 105% 100% 95% 90% Key indicators base-lined to 100% in F2012 85% F2012 F2013 F2014 F2015 F2016 F2017 1H2018 Broiler feed price index Feed conversion efficiency index Feeding cost index 12 12 Source: Own Data
BROILER PRODUCTION PERFORMANCE 125% 120% 115% 110% 105% 100% 95% 90% 85% 80% Key indicators base-lined to 100% in F2012 75% F2012 F2013 F2014 F2015 F2016 F2017 1H2018 Mortality Feed conversion efficiency Efficiency factor (PEF) 13 13
“ ”
FEED DIVISION - OVERVIEW Revenue - R million Operating profit - R million 4 000 200 192 184 3 448 3 000 3 097 100 2 000 1 000 - - 1H2017 1H2018 1H2017 1H2018 Revenue down 10.2% Operating profit up 3.8% • • Raw material costs down Net margin 6.2% 1H2017: 5.3% • • Average selling prices down 16.3% Improved trading conditions • Sales volumes up 7.3% 15 15
FEED DIVISION - OVERVIEW SAFEX yellow maize prices decreased significantly for the period under review 1H2018 avg. R1 981 per ton (1H2017: R2 973) down R992 per ton year-on-year Feed volumes increased due to both higher internal feed requirements and higher external feed sales Internal feed sales increased by 7.2% due to an increase in broiler production numbers in 1H2018 off cutbacks in the comparable period of the prior year External feed sales increased by 7.4% as livestock sectors recovered following the high feed costs associated with the 2016 drought Margins improved in the period under review with an increase in the net rand per ton margin achieved 16 16
FEED DIVISION - SALES Meadow Feeds - Sales Mix 13% 13% 1H2018 1H2017 21% 21% 703 827 Tons 656 169 Tons Volume increase ≈ 7.3% 59% 59% 7% 7% 17 17
“ ”
OTHER AFRICA DIVISION - OVERVIEW Revenue - R million Operating profit - R million 250 20 216 200 17 15 185 150 10 100 5 50 5 - - 1H2017 1H2018 1H2017 1H2018 Revenue down 14.4% Operating profit up • • Raw material costs down Net margin 9.1% 1H2017: 2.4% • • Average selling prices down 9.6% All countries improved performance • Sales volumes down 5.0% 19 19
INDUSTRY TRENDS
SAFEX YELLOW MAIZE PRICE 21 21 Source: CJA Strategic Risk Brokers
SAFEX YELLOW MAIZE PRICE vs. CBOT IN RAND TERMS 22 22 Source: CJA Strategic Risk Brokers
DURBAN SOYA MEAL PRICE 23 23 Source: CJA Strategic Risk Brokers
Source: SAPA POULTRY IMPORTS PER MONTH 10 000 15 000 20 000 25 000 30 000 35 000 40 000 45 000 50 000 55 000 60 000 65 000 70 000 5 000 - Tons Oct-11 Dec-11 Feb-12 Apr-12 Jun-12 Aug-12 Total poultry imports Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 6 per. Mov. Avg. (Total poultry imports) Dec-14 Feb-15 Apr-15 Jun-15 Aug-15 Oct-15 Dec-15 Feb-16 Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17 Apr-17 Jun-17 Aug-17 Oct-17 Dec-17 Feb-18 24 24
100% 110% 120% 130% 140% 150% 160% 170% 180% Source: Own Data 80% 90% BROILER SELLING PRICES Oct-11 Dec-11 Feb-12 Apr-12 Jun-12 Aug-12 Oct-12 Dec-12 Broiler selling price index Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 new legislated Apr-15 recovery on brine levels Jun-15 IQF cost Aug-15 Oct-15 Dec-15 Six month average Feb-16 Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17 Apr-17 Jun-17 Aug-17 Oct-17 Dec-17 Feb-18 25 25 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
BROILER PRICE vs. FOOD PRICE INFLATION 180% 180% IQF cost 170% 170% recovery on 160% 160% new legislated brine levels 150% 150% 140% 140% 130% 130% 120% 120% 110% 110% 100% 100% 90% 90% 80% 80% 70% 70% Oct-11 Dec-11 Feb-12 Apr-12 Jun-12 Aug-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Apr-15 Jun-15 Aug-15 Oct-15 Dec-15 Feb-16 Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17 Apr-17 Jun-17 Aug-17 Oct-17 Dec-17 Feb-18 Broiler selling price index SA food price index 26 26 Source: Own Data & CJA Strategic Risk Brokers
Source: Own Data CHANGE IN BROILER PRICE vs. FEED PRICE -30% -20% -10% 10% 20% 30% 40% 0% Oct-11 Dec-11 Feb-12 Apr-12 Jun-12 Aug-12 % Change in feed price Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 % Change in broiler selling price Apr-15 Jun-15 Aug-15 Oct-15 Dec-15 Feb-16 Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17 Apr-17 Jun-17 months Aug-17 20 Oct-17 Dec-17 Feb-18 27 27
THE PERIOD IN PERSPECTIVE
THE PERIOD IN PERSPECTIVE Operating profit (PBIT) reconciliation (R million) 1 400 -176 443 1 200 -138 52 1 000 1 044 800 554 600 400 97 200 212 - Broiler Prices Incentive Other PBIT 1H2017 Volumes Feeding Cost Processing Bonuses PBIT 1H2018 Broiler Cost 29 29
FINANCIAL OVERVIEW
INCOME STATEMENT 2018 2017 % change Six months ended 31 March R million R million Revenue 6 666 5 795 15% Operating profit (PBIT) 1 044 212 393% Operating profit margin 15.7% 3.7% Net finance income / (costs) 22 (16) Profit before tax 1 066 196 444% Tax (300) (60) 463% Profit for the period 766 136 Headline earnings 765 138 456% EPS – Cents 1 973 353 460% 455% HEPS – Cents 1 974 356 31 31
Recommend
More recommend
