BMO Farm to Market Conference

Transcription

1 BMO Farm to Market Conference May 21, 2015 ANDE is well-positioned to capitalize on macro trends: World population Middle class Demand for protein Leveraging deep operational experience to: Be a Partner of Choice Grow in North America Leverage Core Capabilities

2 20 5 Forward Looking Statements Certain information that will be discussed today constitutes forward-looking statements. Actual results could differ materially from those presented in the forward-looking statements as a result of many factors, including general economic conditions, weather, and competitive conditions, conditions in the Company s industries, both in the U.S. and internationally, and additional factors that are described in the Company s publicly-filed documents, including its 34 act filings and the prospectuses prepared in connection with the Company s offerings. 2

3 20 5 At a Glance RESULTS Q1 15 Q1 14 Revenues: $950 million $1,003 million EBITDA: $28.8 million $56.4 million Diluted EPS: $0.14 $0.80 *Adjusted EPS $0.14 $0.42 Recent Stock Price: $ week range: $ $69.93 Market cap: $1.3 billion Institutional ownership: 73% Ave. daily trading: 312,343 Analyst coverage: 8 sell-side *Adjusted EPS excludes ($0.38 per share) one-time gain from the partial redemption of the Lansing Trade Group in 2014 Dividend Diluted Earnings Per Share $ th consecutive dividend payment $0.50 $3.84 ($0.38) $0.40 $0.30 $0.20 $2.32 $3.39 $2.82 $3.18 $3.46 $0.10 $ Actual Dividend Paid Street Estimated FY Dividend *Adjusted EPS excludes ($0.38 per share) one-time gain from the partial redemption of the Lansing Trade Group in

4 20 5 Capital Five Year Capital Investments >$690 million ( ) $126 $144 $38 $86 $294 Grain Ethanol Plant Nutrient Rail Other Annual Maintenance Capital Spend $30 to $50 million 4

5 Adjusted Pre-Tax Income ($millions) 20 5 Proven Business Portfolio Performance $220 CAGR 12.5% $200 $180 $160 $148 $167 * $140 $120 $100 $80 $104 $120 $150 $ Income Trend 1 Standard Deviation 2 Standard Deviations *Adjusted pre-tax income excludes $17.1 million pre-tax ($0.38 per share) one-time gain from the partial redemption of the Lansing Trade Group in

6 Millions of Bushels Pre-tax Income/Loss in millions Grain Group Q1 Highlights Grain pre-tax income $6.5 MM vs. PY Expect 89 MM corn acres, (2%) vs PY In millions, except margin Q1 15 Q1 14 FY 14 Revenue $585 $583 $2,682 Gross Profit $29.7 $17.0 $131.1 Gross Profit Margin 5.1% 2.9% 4.9% Pre-tax Income $0.7 $11.3 $58.1 *Adj Pre-tax Inc/(loss) $0.7 ($5.7) $41.0 Grain Storage Capacity Impact Five Year Revenue & Pre-tax Income/Loss 200 Exisiting Capacity $0.70 $100 $4, Income per Bushel Capacity Income Range $0.60 $0.50 $0.40 $0.30 $0.20 $0.10 Income per Bushel $80 $60 $40 $20 $0 -$ * $3,000 $2,000 $1,000 $0 Revenue in millions $0.00 Q1 Q2 Q3 Q4 Revenue *Adj excludes $17.1 MM pre-tax gain from partial sale of interest in Lansing 6

7 Grain Facilities & Affiliates Auburn Bean & Grain 2014 acquisition of 6 grain & 4 agronomy locations Grain storage capacity of 18.1 MM Bu Texas 2014 acquired two food grade facilities 0 Initial investment 2003 Current ownership approximately 39% Sales of $6.6 billion in 2014 $57.6 million net income in 2014 Joint ownership along with Lansing Trade Group,LLC 7

8 US Storage Capacity Top 10 U.S. Commercial (off-farm) storage capacity Company ADM 469, ,565 2 The Gavilion Group 357, ,569 3 Cargill, Inc. 348, ,016 4 CHS, Inc. 323, ,646 5 Bunge North America 219, ,095 6 CGB Enterprise, Inc. 192, ,020 7 Attebury Grain, Inc. 165, ,613 8 THE ANDERSONS, INC. 146, ,075 9 The Scoular Company 120, , Riceland Food, Inc. 112, ,692 Source: 2015 Grain & Milling Annual 8

9 In millions Pre-tax Income/Loss in millions Ethanol Group Q1 Highlights Profitable Q1 despite low industry margins and seasonally low demand Record Q1 ethanol production and E-85 sales Outlook for full-year continues to improve In millions Q1 15 Q1 14 FY 14 Revenue $138 $189 $766 Equity Earnings in Affiliates Consolidated Ops & Service Fees $1.7 $18.6 $68.9 $3.6 $1.2 $23.4 Pre-tax Income $5.3 $19.8 $ Ethanol Production in Gallons Five Year Revenue & Pre-tax Income/Loss $100 $1, $80 $60 $40 $20 $0 $800 $600 $400 $200 Revenue in millions Q1 Full-year Not all Ethanol gallons produced are sold thru -$20 $ Q1 Q2 Q3 Q4 Revenue 9

10 Ethanol Facilities Manager and Investor in 4 plants: 330 MM gallons nameplate capacity Process > 120 MM bushels of corn Average ownership approximately 50% ANDE Ethanol LLC Plants ANDE Ethanol LLC with C0 2 Sales Oil refineries 10

11 In thousands Pre-tax Income/Loss in millions Plant Nutrient Group Q1 Highlights Merged Turf & Specialty Group and Plant Nutrient Group Weather delayed Q1 volume Expect to regain volume in Q2 In millions, except margin Q1 15 Q1 14 FY 14 Revenue $154 $151 $802 Gross Profit $22.0 $22.6 $116.9 Gross Profit Margin Pre-tax Income (Loss) 14.3% 14.9% 14.6% $0.4 ($0.0) $ Sales and Service Volume in Tons Includes fertilizer and cob 2,177 2, Q1 Full-Year Five Year Revenue & Pre-tax Income/Loss $50 $1,000 $40 $800 $30 $600 $20 $10 $400 $0 $200 -$10 $ Q1 Q2 Q3 Q4 Revenue Revenue in millions 11

12 Acquisition of Kay Flo Industries Summary Acquired Kay Flo Industries, a leading fertilizer manufacturing and distribution business Acquisition provides Plant Nutrient Group with: Pure Grade product line positions ANDE as a leading low salt fertilizer manufacturer Adds significant R&D capabilities Expands our market substantially /very little overlap Leverages ANDE s leadership position in eastern corn belt with new products 12

13 Market Expansion North Sioux City, SD Webberville Sioux City, IA Gibbon Sergeant Bluff, IA Maumee Walton Carey Upper Sandusky Logansport Seymour Market Area Manufacturing Facility Headquarters Market Area Manufacturing Facility Headquarters 13

14 Pre-tax Income/Loss in millions Rail Group Q1 Highlights Strong year-over-year increase in lease income driven by higher lease and utilization rates Gains on railcar sales decreased $6.3 MM vs. prior year Full-year outlook positive after good start In millions, except margin Q1 15 Q1 14 FY 14 Revenue $44 $52 $149 Gross Profit $17.3 $21.9 $59.8 Gross Profit Margin 39.2% 41.8% 40.1% Lease Income $5.0 $4.2 $13.6 Railcar Sales Income $4.5 $10.8 $15.8 Service & Other $0.8 $0.0 $2.0 Pre-tax Income $10.3 $15.0 $31.4 Average Utilization Rate Five Year Revenue & Pre-tax Income/Loss 84.6% 86.1% 88.4% 89.5% 91.8% $50 $40 $30 $20 $10 $0 $200 $150 $100 $50 Revenue in millions Q1 Full-year -$10 $ Q1 Q2 Q3 Q4 Revenue 14

15 Rail Group Covered Hopper CF Capacity Cars , , PD Hopper Total 13,635 Tank Car Gallon Capacity , ,678 Total 3,275 Coal / Coke, 612 Steel & iron, 773 Aggregates & stone / Limestone, 1,328 Finished / refined Goods, 524 Railcars Leased by Commodity Wood & Forrestry / Paper, 1,524 Oil / Ethanol / Gasoline, 1,780 Other, 2,097 Plastics, 2,104 Grain / Grain Products, 4,957 Sand / Sand Products / Cement, 2,476 Fertilizer / minerals, 2,799 15

16 Company Outlook Grain Group Cautious optimism Plant Nutrient Group Ethanol Group Expect good Q2 significant planting progress in late April & early May Improving margins on higher driving demand and low corn prices Rail Group Good start to the year focus on sustaining high utilization rates 16

17 20 5 Mission Statement We firmly believe that our Company is a powerful vehicle through which we channel our time, talent, and energy in pursuit of the fundamental goal of serving God by serving others. Through our collective action we greatly magnify the impact of our individual efforts to: Provide extraordinary service to our customers Help each other improve Support our communities Increase the value of our Company 17

18 Q & A