2007 Preliminary Results
Overview of Origin Enterprises
Focus on primary sectors of the food industry
Group activities
– Ambient Food & Cereal Milling
– Agri/Nutrition
2007 Revenue €889m
Shetland Islands
Marine Proteins
Fertiliser
• Agri Inputs
• Marine Proteins
Chemicals
– Property
Animal Feed
Derry
Renewed Focus
– Strategic investment
– Funding capacity
– Dedicated management team
2
Food
Ayr
Associate
– Feed manufacturing (50%)
• John Thompson
PB Kent
Aberdeen
Killybegs
Belfast
Immingham
Ardee
Grimsby
Askeaton
Dublin
Foynes
Ipswich
Newport
New Ross
Cork
Plymouth
Ringaskiddy
Operational Highlights
Establishment of Origin Enterprises plc
– IEX and AIM listing - €100m raised by Origin
– €350m syndicated bank facility
Strong performance across all operations
Acquired controlling interest in Odlum Group
– Completed 30th August 2007
Work continues on unlocking development property value
3
Preliminary Results Highlights to 31st July 2007
Revenue growth of 8.9% to €889.4m
EBITDA growth of 8.6% to €45.7m
Operating profit* increased 10% to €38.1m
Profit before financing costs* up 7% to €41.8m
Operating cashflow of €46.7m
Group net borrowings of €71.7m post
– €100m IPO proceeds
– €256m to IAWS Group plc on reorganisation pre IPO
4
* Before intangible amortisation & exceptional items
2007 Preliminary Results – Profit and Loss
Year Ended July
FY07
€m’s
FY06
€m’s
Growth
Revenue
889.4
816.9
8.9%
EBITDA
45.7
42.0
8.6%
Operating Profit
38.1
34.7
10%
Associates – PAT
3.7
4.4
(15.9%)
Profit before financing costs
41.8
39.1
7.0%
EBITDA %
5.1%
5.1%
Operating Profit %
4.3%
4.2%
5
Segmental Analysis
FY07
€m’s
FY06
€m’s
Growth
Agri/Nutrition
647.7
582.0
11%
Food
241.7
234.9
3%
Total
889.4
816.9
9%
Agri/Nutrition
27.7
24.8
12%
Food
10.4
9.9
5%
Total
38.1
34.7
10%
Agri/Nutrition
4.3%
4.3%
Food
4.3%
4.2%
Total
4.3%
4.2%
Revenue
Operating Profit
Operating Margin
6
2007 Preliminary Results – Profit and Loss
Year Ended July
FY07
€m’s
FY06
€m’s
Growth
Profit before financing costs
41.8
39.1
7.0%
Financing cost, net
(2.6)
(1.0)
Amortisation
(0.8)
(0.7)
Profit before tax
38.4
37.4
Taxation
(6.4)
(6.6)
Profit for the financial year
32.0
30.8
3.8%
Adjusted EPS* - cent per share (Note 1)
24.65**
23.62**
N/A
Adjusted fully diluted EPS*
23.93***
N/A
N/A
Exceptional Gain, net of tax
0.7
0.9
N/A
7
*
Before intangible amortisation and exceptional items
**
Based on 133m shares (i.e. post IPO)
***
Based on 137m shares (i.e. post IPO & dilutive impact of DCS)
Note 1: Base 2007 adjusted EPS is 20.3 cent per share
2.6%
Cash Flow
FY07
€m’s
FY06
€m’s
Cashflow from operating activities
46.7
41.8
Interest
(1.8)
(0.5)
Dividends
0.6
1.6
Capital Investment
(6.1)
(16.3)
Insurance/ Disposal Proceeds
7.6
4.6
Cashflow
47.0
31.2
Issue of shares (net)
102.5
-
Group restructuring / Payment to IAWS
(255.6)
(35.2)
Opening cash
34.4
38.4
Closing Debt
(71.7)
34.4
8
+11.7%
Balance Sheet
Year Ended July
FY07
€m’s
FY06
€m’s
Development Properties
165.5
0.0
Other Tangible Assets
71.1
81.9
Intangibles/Goodwill
15.2
16.6
Associates
26.5
19.6
Working Capital
25.4
31.3
Net Debt
(71.7)
34.4
Taxation – incl DT
(38.7)
(8.7)
Provisions/Grants
(6.8)
(13.1)
Due to PLC
(3.1)
(72.7)
Shareholders Funds
183.4
89.3
9
Key Financial Statistics
€m
FY07
€m
FY06
Excl Investment Properties
19.8%
18.8%
Incl. Investment Properties
11.9%
11.2%
Bank Borrowing (Net)
71.7
(34.4)
Net Debt/EBITDA
1.6X
N/A
Effective tax rate**
18.5%
20%
Year Ended July
Return on Investment*
* Investment includes goodwill eliminated against reserves of €53m
10
** Wholly owned subsidiaries
Key Characteristics
Strong market
positions
Strategically located
& well invested
asset base
Businesses with
predictable
demand
Expertise in primary
processing,
manufacturing,
logistics & marketing
Strong cash
generation
Focused new
product
development in
Food
11
Agri-Nutrition 2007 Key Facts
2007 Revenue
€647.7m
Total No. of employees
459
Total Volume (tonnes)
3.2m
No. of facilities
2007 Revenues €889m
21
Food
27%
Agri - Nutrition
73%
12
Food Demand & Supply – The Changing Dynamic
World food demand could double by 2050
– 50% increase from world population growth
– 50% increase from broad based economic growth in low income
countries
Climate change and energy security - Biofuels
Global agricultural production
– Grain production not keeping pace with consumption
– Farmers competing with industry & increased urbanisation for depleting
water reserves
– Asia & the Middle East cannot be self sufficient in food
Price outlook for food depending upon grains expected to increase
Sustainable competitive advantage from grass based livestock production
13
Source: R.L.Thompson University of Illinois March 2007
World Grain Production Remains Behind Use
14
Source: US Department of Agriculture
World Ending Stocks and the Role of China
in mln t and %
15
Commodity Price Trends – CBOT Wheat - 10 year price trends
16
Commodity Price Trends – CBOT Corn - 10 year price trends
17
Future Farm Enterprise Landscape
Removal of link between production & support payments
–
–
–
–
Farm management decisions divorced from subsidies
Focus on commercial returns from farming enterprise
Trend towards fewer, larger and more efficient farm enterprises
Farmers in control of farm management decision for the first time
in 30 years
Origin ideally positioned to support the change
18
Agri Inputs – Feed Ingredients
Market leader in the importation of
animal feed ingredients and cereals
Business model
– Logistics
– Operational scale
– Key supplier relationships
2007 performance
– Buoyancy in key feed sectors
– Stable livestock population
– Management refocus
19
Agri Inputs – Fertiliser
Market leader in importing and
distribution of blended fertiliser
in Ireland and the UK.
Business model
– Proximity business
– Prescription fertilisers
– Well invested facilities
2007 performance
– Improved performance in Ireland
– Volume growth in the UK
– Record cereal prices and biofuel investment
20
Marine Proteins
Leading producer of fishmeal and fishoil in Ireland &
the UK
Strategically located facilities close to major fisheries
– Killybegs
– Aberdeen
– Grimsby
– Shetland Islands
2007 performance
– Record high finished product prices
– Continued growth in aquaculture
Expansion
– Increased focus on trawler efficiency
– New Killybegs facility
21
Origin
Food - Shamrock Foods
2007 Revenue of €241.7m
Leading ambient food sales, marketing and distribution
business
Focussed on two core business areas:
– Owner of two leading Irish brands – Shamrock & Roma
– Foremost provider of distribution and supply chain
solutions
2007 Revenues €889m
2007 performance
– Momentum in own
Food
brand categories
27%
Agri -Nutrition
– Brand extension
73%
– Satisfactory agency
business performance
Commodity price increases
22
Food – Odlums
Acquisition of balance (50%) of Odlum Group
– Consideration of €35m
– Assumption of debt (100%) €22m
– Completed 30th August 2007
Single largest cereal milling company in Ireland
Annual flour production capacity in excess of 175,000t
Odlums:
– Leading Irish brand in retail flour
– Growing export branded oatmeal business
Main markets Ireland, UK and North America
23
Food - Odlums Relevance
Flour
–
–
–
–
Service
Customisation of flours
Growing demand for convenience products
NPD and Target marketing
Oatmeal
– Growing category
– Synonymous with health
– Export focused
• McCann’s is the No.1 imported oatmeal brand in the US
24
New Product Development
25
Food - Odlums Opportunities
Market growth
– Flour
– Oatmeal
Milling strategy
Momentum within the Cork Docklands
Integration synergies with Shamrock
and R&H Hall
26
Property
Dedicated team in place
Cork South Docks
– Origin - 32 acres close to City Centre
– 121 acres – 2 kms of Waterfront
– Cork Docklands Development Strategy
Newhall
– 55 acre greenfield site
– Zoned industrial/warehouse
– Masterplan being prepared for submission to Kildare Council
Kilcock
– 11 acres unzoned
– Relocation of business
27
Origin Cork South Docks Footprint
Origin
City Centre
Origin
Odlums
Origin
Origin
SM
Origin
Origin
28
Cork South Docks
SDLAP published by Cork City Council in
June 2007
– Detailed plan outlining the redevelopment
of docklands
– Unique opportunity for development of
Cork City
– Supporting 20,000 residents and working
population of 25,000
Submisssion by Origin of
– A strategic masterplan in Sept. 2006
– Detailed responses to SDLAP
Planning application being finalised for key 2
acre site
Business relocations being progressed
29
Outlook
Growth dynamic within core operations
– Fundamental supply/demand shift
– Market confidence
– Repositioning within primary food production
• Focus on commercial returns
• Evolution of business model
• Consolidation
30
Outlook cont.
Origin ideally positioned to support change
– Strong market positions
– Cash generative business model
– Funding capacity for future development
Experienced and focused management team
Track record of business acquisition and integration
Consolidation and acquisition opportunities
Shareholder Value focus
31
Origin Investor Relations would be happy to facilitate any further
information requests.
Contact Name:
Phone:
Fax:
E-mail:
Website:
Contact us:
32
Marion Caulwell
+353 1 612 1311
+353 1 612 1321
[email protected]
www.originenterprises.com/investor_centre
Origin Investor Relations
151 Thomas Street
Dublin 8
Ireland