COMVITA LIMITED INVESTOR PRESENTATION 2013 Neil Craig, Chairman, Ph Brett Hewlett, Chief Executive O fficer, Ph.

Transcription

1 COMVITA LIMITED INVESTOR PRESENTATION 2013 Neil Craig, Chairman, Ph Brett Hewlett, Chief Executive O fficer, Ph

2 2014 Half Year Update NZD $000 S 6 MONTHS ENDED 30 SEPT MONTHS ENDED 30 SEPT 2012 Sales 43,362 45,434 EBITDA * 1,893 5,314 Net (loss)/profit after tax - NPAT (790) 2,386 Earnings per share NPAT (NZ Cents) (2.70) 8.39 Dividend per share (NZ Cents) *EBITDA: Earnings Before Interest, Tax, Depreciation and Amortisation 2

3 Achievements 2014 Half Year Rebuilding inventory of Manuka honey Expansion of 100% owned apiary operations New acquisition in Gisborne - Tawari Apiaries Olive Leaf planting programme at our new farm Derma Sciences invests $8.9m Opening of Auckland Concept store and Comvita tourism venture, Experience Comvita System projects initiated POS, Demand Planning, Apiary Management, E-Commerce Factory expansion and Paengaroa site development Outlook Second half year sales expected to be >60% of total Strong growth in key Asian markets Medihoney TM wound care sales growth Net earnings and Sales expected to exceed

4 The following pages are from the May 2013 Investor Presentation 4

5 Comvita Results at Upper End of Guidance Financial results for the year to 31 March 2013 $M 2012 $M Change % Revenue % EBITDA * (5.2%) Net profit after tax (9.8%) Earnings per share (cents) (11.7%) Dividends (cents) (7.1%) *EBITDA: Earnings Before Interest, Tax, Depreciation and Amortisation 5

6 Balance Sheet Very strong position, significant borrowing headroom for possible acquisitions and for capital expenditure. Any such acquisitions would need to be demonstrably earnings positive per share in the short-term. Key Ratios Shareholder equity ratio 60% Net debt 25m Net debt to EBITDA 1.7 x Net interest cover 9.4 x Net debt to equity ratio 31% 6

7 Financial Performance Group Revenue EBITDA ** $31m $39m $85m $82m 2006 $65m * $71m $96m $103m 2008 $0.4m * $4.8m $15.5m $14.7m $4.1m $5.3m $6.3m $11.2m * 15 month period, due to change in balance date. ** EBITDA Earnings before interest, tax, depreciation, amortisation, impairments and fair value movements of financial instruments. 7

8 Achievements Group sales grew by 8% Strong growth in Hong Kong, China, Korea Assertive pricing and continued strong demand underpins premium brand position in Asian markets Increased share of Manuka honey supply under direct ownership, through Apiary acquisition Investment in Fresh Olive Leaf Extract R&D pays-o ff with positive results Continued strong growth in the medical honey category SUPPLY CHAIN MARKET DEVELOPMENT SCIENCE AND RESEARCH Acquisition of Whanganui-based apiary business lifts share of honey source under ownership to >30% Acquisition of additional property for Olive Leaf production Paengaroa HQ site future-proof development project underway Strong growth in Hong Kong and China confirms premium position of Comvita brand Korea retail presence bolstered with a total of 12 retail outlets in major department stores >25% of sales now made direct to consumers via retail and internet Premium branding helps insulate impact of Manuka honey shortages and cost increases Clinical trial results for fresh Olive Leaf Extract shows benefit for those at risk of diabetes New health claim and product o ffering for fresh Olive Leaf Extract opens new market opportunities International research papers provide further support for wound healing technologies China propolis Blue Hat registration 8

9 Sales by Region $45.3m $24.5m $21.2m $6.4m $6.1m ASIA AUSTRALIA NEW ZEALAND UK/EUROPE NORTH AMERICA 9

10 Sales by Category 42% 48% 5% 4% 1% HEALTHCARE FUNCTIONAL FOODS PERSONAL CARE MEDICAL OTHER 10

11 Outlook Restored earnings growth Continued strong growth in key Asian markets Online and retail sales developments Continued e fforts for security of supply for Manuka Honey Opening of Comvita Tourism Experience, Bay of Plenty Growing greater capacity for fresh Olive Leaf Extract Further diversification of ingredient platform leading to exciting new business development opportunities 11

12 Evolving Our Business Sales $103m $31m Gross Margin% 56% 34% EBITDA $14.7m $4.1m Assets $137m $50m Employees % Sales Export 80% 60% % Sales via Distributors 16% 85% % Sales Honey 47% 65% % Sales B2C 26% 3% 12

13 Market Segments Manufactures, markets and distributes natural health and beauty products across four key broad market segments 42% 48% 5% 4% HEALTHCARE Variety of healthcare products designed to compete with traditional over-the-counter (OTC) pharmaceutical products Key Products: - Olive Leaf Extract - Propolis - Winter Wellness - Bee Pollen - Royal Jelly FUNCTIONAL FOODS Worlds largest manufacturer and marketer of Manuka honey Invest in ongoing research and development to maintain premium brand positioning Key Products: -UMF Manuka Honey - Apple Cider Vinegar - Honeygar PERSONAL CARE Comprises home-based woundcare, therapeutic skincare and oral care products Key Products: -Manuka Honey skincare - Olive Leaf Extract skincare - Propolis toothpaste and Propolis tooth gel MEDICAL * Does not total to 100% as it excludes Other business unit which accounts for remainder for the 12 months to 31 March 2013 Medical-grade leptospermum (Manuka) honey for treatment of chronic wounds Global licensing deal for Medihoney with Derma Sciences Key Products: -Medihoney medical products 13

14 Value Added Generic Comvita branded health honey Medical Skincare $5 * $14 $104 $330 $500 * Retail selling price per 250g equivalent of raw Manuka honey 14

15 Bottom Standard Layout Without Frond 15

16 Manuka Honey Bottom Standard Layout Without Frond The worlds largest processor of Manuka honey 16,000 hives specialist Manuka honey producer Circa 35,000 hives under contracted supply >30% of Comvita s honey supply under ownership High-tech medical honey extraction facility Manuka planting and land development programmes Plant breeding programme and agronomics 16

17 Fresh Olive Leaf Bottom Standard Layout Without Frond 580,000 olive trees on 157 ha plantation Plant variety selection and screening programme Acquisition of second olive grove, with 7,000 existing organic olive trees on 85 ha - Plans to plant 400,000 trees in next two years Only totally integrated manufacturer - Fresh picked, fresh processed 17

18 Specialist Manufacturing Bottom Standard Layout Without Frond World first honey testing capability UPLC based, in-house laboratory Ethanol and water extraction for bio-actives Honey processing, liquid formulations and packing Exclusive third-party relationships 18

19 Natural Health Innovators Bottom Standard Layout applications Without Frond FDA approved and CE marked medical devices A total of 61 patents or patents pending covering 13 di fferent unique innovations in wound care Global distribution via licensing agreement with specialty US wound care company Derma Sciences Inc. Fresh Olive Leaf Extract: patent position taken around Fresh Olive Leaf Extract for blood sugar control in at-risk adult males 19

20 Bottom Standard Layout Without Frond Research Circa $2.7m p.a. in research and development Isolation and identification of lead bioactive compounds Clinical trials New product development Regulatory approvals for health claims Development of tests for honey quality and authenticity Plant breeding programmes Field agronomic trials Processing methodologies and optimisation Partnership with The University of Auckland and part of global science network 20

21 Building a Premium Global Brand Bottom Standard platforms Layout Without Frond Brand reputation in Asia allows significant price premium over nearest competitors Brand o ffer on focussed, di fferentiated ingredient Brand story has great level of meaning with customers Source and e fficacy of product range Growth and awareness opportunity through tapping into New Zealand tourism via brand experiences 21

22 Bottom Standard Layout - Asian focus Without Frond Consumer Needs Focus Design Large scope to further broaden product o ffering - Foods, healthcare, personal care, medical Very large global natural products sector Global trends support growth - Ageing populations - Growing preference to self-medicate - Increased incidence of degenerative diseases - Tightening regulations eliminating less scrupulous competition 22

23 Diversity and Reach of Direct Channels a Real Strength! Established wholesale business in UK, Australia, NZ Bottom Standard! Layout Without Frond!! Asia 90% direct to consumers 35 dedicated stores and a total of 400 branded retail locations in China 82 Comvita retail locations, 54 in Hong Kong, 12 in Taiwan, 12 in Korea, 2 in UK and 2 in NZ!! Web sales growing online in all Comvita markets, with total online sales nearly doubling in the last 12 months Medical products via specialist distributor 23

24 Bottom Standard Layout Without Frond 24

25 Auckland Concept Store 25

26 Experience Comvita 26

27 Manuka Honey Without Frond 27

28 Propolis & Royal Jelly Without Frond 28

29 Winter Wellness Without Frond 29

30 Fresh Olive Leaf Complex 30

31 Skin Care Without Frond 31

32 Medihoney Without Frond 32

33