Financial Year 2017 Annual Results Presentation

Transcription

1 Financial Year 2017 Annual Results Presentation HOCHDORF Holding Ltd Zurich, 05 April 2018

2 Annual Results Presentation Agenda 1. Welcome address Thomas Eisenring 2. HOCHDORF Group Thomas Eisenring 3. Financial details 2017 Marcel Gavillet 4. Update Thomas Eisenring 5. Outlook and Calendar Thomas Eisenring 2

3 Annual Results Presentation Agenda 1. Welcome address Thomas Eisenring 2. HOCHDORF Group Thomas Eisenring 3. Financial details 2017 Marcel Gavillet 4. Update Thomas Eisenring 5. Outlook and Calendar Thomas Eisenring 3

4 Welcome Address Successful forward integration The results 2017 show that the move closer to consumers has turned out to be the right strategic decision. Acquisition of Zifru Trockenprodukte GmbH Acquisition of the brand Snapz Baby Care Division has developed very well with Pharmalys Work on the new spraytower line lags slightly behind the original schedule (start for commercial production in June 2018) Important impacts on the good result 2017: Strong and profitable growth of Pharmalys Laboratories SA Weak margins in the Dairy Ingredients Division Pleasing growth in turnover and profitability of Marbacher Ölmühle 4

5 Annual Results Presentation Agenda 1. Welcome address Thomas Eisenring 2. HOCHDORF Group Thomas Eisenring 3. Financial details 2017 Marcel Gavillet 4. Update Thomas Eisenring 5. Outlook and Calendar Thomas Eisenring 5

6 HOCHDORF Group Legal form by HOCHDORF Holding Ltd is organised in three business units. HOCHDORF Holding Ltd Dairy Ingredients Baby Care Cereals & Ingredients HOCHDORF Swiss Nutrition Ltd (100%) HOCHDORF Baltic Milk Ltd (100%) Uckermärker Milch GmbH (60%) Ostmilch Handels GmbH (26%) HOCHDORF Swiss Nutrition Ltd (100%) Pharmalys Laboratories SA (51%) Pharmalys Africa S.à.r.l (51%) Pharmalys Tunisie S.à.r.l. (51%) HOCHDORF Americas Ltd (60%) HOCHDORF Swiss Nutrition Ltd (100%) Marbacher Ölmühle GmbH (100%) Zifru Trockenprodukte GmbH (100%) HOCHDORF South Africa Ltd (90%) Snapz Foods AG (65%) 6

7 Annual Results Presentation Agenda 1. Welcome address Thomas Eisenring 2. HOCHDORF Group Thomas Eisenring 3. Financial details 2017 Marcel Gavillet 4. Update Thomas Eisenring 5. Outlook and Calendar Thomas Eisenring 7

8 Financial details 2017 TopLines Satisfactory business year despite very difficult market situation in the EU in % Volume of liquid processed 650,017 t 741,770 t Quantities produced 186,845 t 236,179 t Net sales Mio. CHF Mio. CHF EBITDA 55.7 Mio. CHF 33.4 Mio. CHF EBIT 42.6 Mio. CHF 22.5 Mio. CHF Net profit 40.8 Mio. CHF 19.4 Mio. CHF

9 Financial details 2017 Key figures income statement Record figures in EBITDA and EBIT. in CHF 1, Net sales 600, , ,476 Earnings before interest, tax, depreciation and amortisation (EBITDA) As % of production revenue 55, , , Earnings before interest and tax (EBIT) As % of production revenue 42, , , Net profit As % of production revenue 40, , ,

10 Financial details 2017 Key factors 2017: A challenging and interesting business year. All-time high prices for milk fat in the international market vs. very low prices for milk protein and skimmed milk powder Difficult market environment in Europe for Dairy Ingredients. Integration of Pharmalys Group companies Group profit mainly supported by Baby Care Business Division Baby Care: strong net sales and income growth of the Pharmalys group but lower production volumes of infant formula in Switzerland (Egypt & Libya) Dairy Ingredients: lower export funding and margin losses Cereals & Ingredients: significant margin increase at Marbacher Ölmühle Costs correspond to the expectations Successful issuance of mandatory convertible securities Successful placement of a public hybrid bond 10

11 Financial details 2017 Balance sheet With the Convertible and the Hybrid Bonds low equity as per prior year back to normal level. Solid financing basis for further growth. ASSETS in CHF 1, Current assets 278, % 208, % Non-current assets 303, % 217, % Total assets 582, % 425, % LIABILITIES Current liabilities 215, % 139, % Non-current liabilities 57, % 240, % Total liabilities 272, % 379, % Shareholders equity 309, % 45, % Total liabilities and shareholders equity 582, % 425, % 11

12 Financial details 2017 Cash flow statement Investments in fixed assets and Pharmalys. Expecting negative free cash flow for in CHF 1, Cash flow before changes in net working capital, interest and taxes 56, %* 32, %* Change in net current assets -50,016-7,987 Cash flow from operating activities 6, %* 24, %* Cash flow from investing activities -90,097-57,746 Free cash flow -84, %* -33, %* Cash flow from financing activities 79,924 58,131 Currency translation Net change in cash and cash equivalents -3,847 24,685 Cash and cash equivalents at ,707 43,023 Cash and cash equivalents ,860 67,708 * As % of net sales 12

13 Financial details 2017 Share information High interest in HOCHDORF and good results lead to sustained share prices Profit per share (in CHF) Dividend per share (in CHF) 4.00* Dividend return 1.40%* 1.23% 2.19% 2.68% Share price as of (in CHF) Market capitalisation as of (in CHF million) Price/earnings ratio P/E as of *Proposal of the Board of Directors to the General Assembly 13

14 Financial details 2017 Net sales by region Export share continuous to rise as expected. Middle East / Africa Mio. 22.0% Americas / Rest 8.3 Mio. 1.4% Asia 22.6 Mio. 3.8% Switzerland Mio. 33.4% Europe Mio. 39.5% 14

15 Financial details 2017 Number of employees With the construction of Tower 9, the number of employees will rise by around 80 employees. Currently 34 apprentices in 6 professions

16 In Mio. CHF Financial details 2017 Net sales by division Lower milk intakes due to difficult price situation in EU. Lower production volumes of infant formula in Switzerland (Egypt & Libya) Dairy Ingredients Baby Care Cereals & Ingredients and 2015: gross sales revenue in mio. CHF per division. 16

17 Financial details 2017 Dairy Ingredients Difficult market conditions in the milk business due to low milk prices and harder competition in market Net sales (in CHF 1,000) 405, , , ,563 Revenue generated abroad 55.4% 55.1% 55.2% 26.1% Tonnes 165, , ,511 80,737 17

18 Financial details 2017 Baby Care Higher turnovers due to Pharmalys. Negative impact Libya and Egypt Net sales (in CHF 1,000) 168, , , ,988 Revenue generated abroad 95.8% 95.5% 91.7% 91.3% Tonnes 16,751 17,159 16,763 15,651 18

19 Financial details 2017 Cereals & Ingredients Growth because of new product launches and range adjustments Net sales (in CHF 1,000) 26,645 25,478 24,859 17,913 Revenue generated abroad 53.1% 49.0% 45.9% 22.9% Tonnes 7,902 7,474 8,547 3,733 19

20 Annual Results Presentation Agenda 1. Welcome address Thomas Eisenring 2. HOCHDORF Group Thomas Eisenring 3. Financial details 2017 Marcel Gavillet 4. Update Thomas Eisenring 5. Outlook and Calendar Thomas Eisenring 20

21 Strategy HOCHDORF s Vision HOCHDORF s vision is based on its future business model, whereas the transformation has already started. «We transform this company into a most profitable niche player in global premium food markets.» 21

22 Strategy USP of HOCHDORF HOCHDORF acts consequently as a Swiss mid sized company in a global market. 1. We are a Swiss company We reflect the whole bunch of Swiss values, like reliability, quality, precision 2. We are a mid sized company We work with leanest possible structures We are aware that nothing is more difficult to copy than a personal business relationship Our talents are our main assets 3. We are an independent company As one of the few dairy companies we are independent from milk producers and are able to focus on customer and shareholder values independent from our suppliers 4. We are an agile and responsive company Our customer service is best in class 5. We are a courageous company We develop markets where competitors hesitate Our marketplace is this planet We consider personal business relationships as the most valuable assets 22

23 Strategy Value Proposition Policy HOCHDORF s aim is to increase added value in its products sold significantly. 1. Focus on premium markets In every business we are active, we focus on the premium segment 2. Focus on «unsaturated» countries with high growth rates MEA countries, Asia and LATAM are still the countries we focus on China still limited to 25% market share in Baby Care Exceptions only in special cases (e.g. organic for USA) 3. Development of higher margin products Chocolate Kids Food Added value Base Powders (Baby Food grade) & enriched Instant Products 4. Enhance margins in existing businesses Forward integration Elimination of intermediaries where possible Development of branded business 5. Professional focus on cost Cost efficiency is always key 23

24 Update Product Offensive 2016 Product offensive showed in 2016 that HOCHDORF has to increase the capabilities to efficiently develop new products. Kids Foods With fruit, vegetable and wheat Weaning Foods Only branding/trading Instant Milks Fortified with minerals and vitamins Base Powders As ingredients for more basic infant formulas Chocolate Produced in South Africa «on the continent for the continent» 24

25 Update Product Offensive 2017 Progress in our product offensive in 2017 has been quite impressive. Kids Foods With fruit, vegetable and wheat Instant Milks Fortified with minerals and vitamins Specialities Instant milks with medical claims Base Powders As ingredients for more basic infant formulas Chocolate Produced in South Africa «on the continent for the continent» 25

26 Update Dairy Ingredients Challenging Situation in Dairy Ingredients Divergent development of fat and protein markets lead to more and more challenging situation in traditional dairy ingredients. 1. HOCHDORF Baltic Milk With a strong focus on proteins and in a very difficult political environment in Lithuania HOCHDORF Baltic Milk is under review 2. Portfolio reassessment Portfolio of Dairy Ingredients will be consequently reassessed with an impact of production volumes Milk prices must be aligned to the market situation Photo: Spiegel 26

27 Update Dairy Ingredients Way forward in Dairy Ingredients The way forward in Dairy ingredients is a consequent focus on niches and branded businesses. 1. Niches We have a development program in place which focusses on instant milks with special nutritional requirements, medical claims and new trends 2. Branded business Also in Dairy Ingredients we develop our own brands in selected BTC markets Focus on MEA countries, use of PHARMALYS distribution network Photo: Spiegel 27

28 Update Baby Care Significant more Capacity in Baby Care With the new production line for infant formula we tripled our capacity to now tons. 1. New production equipment New production equipment consists of a t spraying tower, a new tin line and a high rack storage; all of latest technology The Sulgen plant is one of the most advanced in Europe and starts commercial production in June New profile is challenging With this size, HOCHDORF becomes a seriously taken player in the infant formula market New customers are much more demanding than in older times Photo: HOCHDORF 28

29 Update Baby Care Focus on Sales is now Key Our organisation has been restructured and strengthened to achieve best possible project pipeline. 1. Power team independent from hierarchies The position of a CSO has been skipped and transformed into a highly skilled acquisition team independent from hierarchies 2. Very promising pipeline We have been able to create a project pipeline with more than t and developed new potential partnerships Photo: NNPC 29

30 Update Baby Care Impressive Performance of Pharmalys The impressive performance of PHARMALYS will continue in the coming years. 1. New product launches The recipe of our brand Primalac will be changed from vegetable oil to milk fat, which is a clear trend New brand Nutrimilk will be launched this summer Additional launches of instant milks with medical claims 2. Further market penetration There are many markets where we just started; the growth potential in these markets is considerable 30

31 Update Cereals & Ingredients Marbacher Ölmühle Quality and profitability in wheat germs, special oils and crisps have improved significantly. 1. Wheat germs Production of Viogerm crisps and cereals is much more cost efficient and competitive for the world markets 2. Special oils Our oil specialties have now achieved a quality level which is highly respected in the industry and received various awards 31

32 Update Cereals & Ingredients Zifru and Snapz With the acquisition of Zifru and Snapz we can now play a different game in interesting markets. 1. All under one roof -approach With extrusion, MIVAC drying and packaging under one roof Zittau becomes our most efficient plant for extruded products and healthy snacks 2. With Snapz we go where new trends usually start With Snapz we have now access to the US market where the development of healthy kids snacks is most developed 32

33 Update Summary HOCHDORF s development in 2017 shows that we are on the right way to play in another league, but we are still at the beginning. 1. Restructuring of Dairy Ingredients Dairy commodity markets will remain difficult; we have not to be in any business and will restructure our portfolio The rules in Switzerland will change in 2019; we will be prepared for it 2. Watching out for further forward integration opportunities The forward integration with Pharmalys proved the enormous potential of this approach; we watch out for other opportunities 3. Still play professionally the BTB role The BTB business is still important for us; with our new customer base requirements are tougher; we have to play our role professionally 4. Develop Cereals & Ingredients to another HOCHDORF pearl With the new set-up in Cereals & Ingredients we have the base to develop this business to a real pearl in HOCHDORF s portfolio 33

34 Annual Results Presentation Agenda 1. Welcome address Thomas Eisenring 2. HOCHDORF Group Thomas Eisenring 3. Financial details 2017 Marcel Gavillet 4. Update Thomas Eisenring 5. Outlook and Calendar Thomas Eisenring 34

35 Outlook and Calendar Financial Outlook represents a transitional year and will be challenging. Important influences: Ongoing projects for achieving our strategic goals Market the additional capacities in the Baby Care Division Bring our business of healthy Kids Food and Snacks to market Distribute the developed high value-added new products in the Dairy Ingredients Division Expected net sales CHF Mio. Expected EBIT as % of production revenue 7.0 to 7.5% 35

36 Outlook and Calendar Financial Calendar 2018 Upcoming events of the HOCHDORF Group 04 May August 2018 Annual General Meeting Letter to the shareholder with half year results 36

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