Investor Relations April/May 2016 Fyffes plc
Fyffes overview Operates in the international fresh produce sector - Portfolio products bananas, pineapples, melons, mushrooms - Areas of activity Europe, US, Canada, Central & South America Market leader in 3 of our 4 product categories Integrated supply chain production, procurement, shipping, ripening, distribution and marketing Oldest fruit brand in the world dating back to 1929 History extends to 125+ years Dual listing on Irish (ESM) and London (AIM) stock exchanges 1
2016 Acquisition activity Highline Produce Fits Fyffes strategic objective of adding a 4 th product to our portfolio Fits criteria of being an established, successful, integrated operator in a category with significant scale Fully integrated Eastern Canada based mushroom business Experienced management team. 55 year history 4 owned production facilities and 1 leased distribution centre Debt free valuation of CAD$145m ( 98m) Equivalent to 8.1 times pro forma annualised EBITDA of CAD$18m ( 12m) Immediately accretive Net debt post acquisition less than 2.5 times EBITDA. Will reduce to less than 2 times within 2 years 2
2015 Acquisition activity Farming assets Purchased additional melon farming assets in Guatemala Comprises 2,500 hectares of leased land and 4 packaging stations Adds c.25% to existing capacity in melon category Investment of US$18.3m plus US$10m- US$12m incremental working capital Purchased banana farm in Costa Rica Investment of US$15m Have been operating farm since early 2014 under lease arrangement Accounts for c.3% of Fyffes banana volumes 3
Fyffes earnings history & 2016 targets 80 70 60 50 40 30 20 EBITDA - M 18.9 25.7 26.9 29.6 40.0 40.0 48.2 56.1 63.0-69.0 18.00 16.00 14.00 12.00 10.00 8.00 6.00 4.00 3.95 EPS - cent 5.19 5.50 6.05 8.55 8.82 11.17 12.73 12.80-14.50 10 2.00 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 0.00 2008 2009 2010 2011 2012 2013 2014 2015 2016 70 60 50 40 30 20 EBITA - M 15.3 20.7 21.3 23.2 30.5 32.7 40.1 45.8 49.0-55.0 Growth rate 2008-2015 Absolute CAGR EBITDA 198% 16.9% EBITA 200% 17.0% EPS 222% 18.2% 10 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2016 target ranges updated 29 April 2016, including impact of Highline for 9 months post acquisition 4
Fyffes Market position Europe Market size (Cases) North America Market size (Cases/lbs) #1 300m #4 250m Fyffes 46m 10m (JV) #3 75m #3 80m Fyffes 7m 3m - - #1 50m Fyffes N/A 17m - - #4 1,100m lbs Fyffes N/A 58m 5
Competitive advantages Scale of business Relationships with best in class suppliers Strong brand recognition Valuable asset base State of the art infrastructural network Strong customer relationships 6
Focus on efficient capital allocation Acquisitions at all points in the supply chain and organic growth Increasing dividend Share buy-backs Key medium term focus is on growing the business through M&A Believe further consolidation is needed in industry 7
Shareholder return Dividends M Buybacks M Total M 2007 5.3 1.7 7.0 2008 5.2 5.3 10.6 2009 5.7-5.7 2010 5.9 5.3 11.2 2011 5.9 12.7 18.6 2012 5.9-5.9 2013 6.2-6.2 2014 6.6 3.0 9.6 2015 7.3-7.3 Total 54.0 28.1 82.1 2015 dividend 2.745 cent (+15.0%) Compound annual growth in dividend 2008-2015 of 9.0% Dividend yield 1.7% based on 160 cent share price 8
Summary Strong 2015 result. EBITA up 14.2% to 45.8m Acquisition of Highline Produce Limited for CAD$145m ( 98m) Revised 2016 target EBITA range of 49m- 55m (including Highline for 9 months post acquisition) Focus on future development and shareholder value 9
Overview of operations 10
Overview of operations production Production Profile Bananas Pineapples Melons Mushrooms Growing cycle 9 months 14 months 6-10 weeks 10 weeks Harvesting Year round Year round Seasonal Year round Fyffes own production c.7% c.65% c.100% c.90% 11
Banana category 12
Key drivers of short term performance Selling price Influenced by many factors, particularly volume UK market medium term pricing Continental market short term pricing more prevalent, but trend towards medium term deals Cost of fruit Annual pricing and production costs Shipping / fuel Long term container shipping deal in place Fuel purchased weekly Exchange rates Costs US Dollar denominated Revenue in Euro and Sterling Import duty Programmed reduction in banana import duty 13
Overview of operations Logistics Fruit shipped in container ships in reefer containers Ensures freshness of produce and delays banana ripening process 4 week round trip to / from Tropics. Routing tailored to our requirements Weekly deliveries to multiple European ports Bunker fuel a significant factor 14
Overview of operations Distribution Supply ripened (yellow) bananas to customers in UK / Ireland, mainly larger retailers Fyffes only operator in UK with national distribution coverage Ripening process takes 5-9 days Traditionally only unripened (green) bananas sold to customers in Continental Europe Increasing amount of Continental ripening including by Weichert and vanwylick JVs 15
Bananas Global marketplace Europe 300m cases marketed Russia c.60m cases marketed N America 250m cases marketed China* 500m cases 15% imported Asia 120m cases marketed Key Producers Ecuador 280m Guatemala 115m Costa Rica 100m+ Philippines 100m+ Colombia 90m+ Key Distributors - Global Chiquita 125m Fresh Del Monte 117m Dole (post disposal) 110m Fyffes 56m Middle East c.60m cases marketed Key Distributors - Europe Fyffes Chiquita Fresh Del Monte Dole 46m 33m 23m 19m * Fyffes has new ripening JV in China. Targeting 3m+ cases per annum 16
Pineapple category 17
Pineapples Global marketplace c.190 million cases marketed annually North America largest market with 80 million cases annually Europe 2 nd largest market with 75+ million Key producers Cases M Costa Rica (80%) 150 Philippines (10%) 20 Key distributors Cases M Fresh Del Monte 60 Dole 35 Fyffes 10 18
Melon category 19
Melons US imports c.50m cases of melons from November May #1 in this category importing c.17m cases - before recent acquisition which is expected to add 20-25% to volumes Volumes / sales doubled since acquisition Production capacity increased in Honduras and Guatemala each year US market 20
Mushroom category 21
Mushrooms Total North American fresh mushroom market c.1,100m lbs (500k MT) Highline volumes c.58m lbs (26k MT) #4 position in North America #1 in Canada #1 globally in organic production Highline uses modern production systems Significant historical investment in facilities Focus on higher yields and good quality Mushrooms are a superfood great source of minerals, vitamins and antioxidants 22
Increased focus on production Farmed land in Central America bananas, pineapples and melons Land values appreciating in Central America 23
Appendix 24
Summary 2015 Fyffes delivered another year of record earnings EBITA up 14.2% to 45.8m EPS up 14% to 12.73 cent 7 th consecutive year of earnings growth Compound annual growth in EPS of 18.2% since 2008 Strong return on invested capital of 15.9% Full year dividend increased by 15% 25
Financial highlights 2015 2015 2014 % Change Total revenue 1,222.5m 1,090.9m +12.1% EBITDA 1 56.1m 48.2m +16.4% EBITA 1 45.8m 40.1m +14.2% EBIT 1 45.8m 40.1m +14.2% EPS 2 12.73c 11.17c +14.0% Total dividend per share 2.745c 2.387c +15.0% ROIC 3 15.9% 18.4% - 1. Before exceptional items and share of joint venture tax. 2. Before exceptional items. 3. ROIC after tax, including JVs. 26
Operating performance 2015 2015 M 2014 M % Total turnover 1,222.5 1,090.9 +12.1% EBITDA 56.1 48.2 +16.4% Depreciation (10.3) (8.1) EBITA 45.8 40.1 +14.2% Amortisation - - EBIT 45.8 40.1 +14.2% 12% increase in turnover. Excluding translation impact underlying sales growth was 7%. Mainly mid single digit organic volume growth in bananas and melons. 5.7m (14.2%) increase in Adjusted EBITA analysed by category on following slides. No amortisation charges in either year. Excludes 12m net exceptional charges comprising 11.1m impact of closing Irish DB pension scheme, 2.9m fine paid by joint venture, less 2m writeback of costs accrued in 2014 in relation to proposed Chiquita merger. 27
Operating performance 2015 Bananas Strong performance in banana category with mid-teens percentage increase in EBITA Significant adverse exchange rate movement year on year USD/EUR and USD/GBP rates 16% and 7% down respectively Reduction in key input costs including logistics (particularly fuel), other import costs and operating overheads Secured necessary increases in selling prices Further mid single digit organic volume growth Exchange rates remain unfavourable in early 2016. Targeting increases in selling prices as a result 28
Operating performance 2015 Pineapples Strong performance in pineapple category As in banana category, exchange rates a significant headwind due to USD strength Secured necessary increases in selling prices, helped by supply constraints Costs also lower, particularly logistics, including fuel Improved efficiency on own farms Volumes marginally lower, mainly due to adverse weather in key production region (Costa Rica) Positive outlook for 2016 on continuing supply constraints 29
Operating performance 2015 Melons Satisfactory result in melon category. Profits down on very strong result in prior year Result impacted by adverse weather conditions in production regions early in year. Knock-on impact on quality and average selling prices Production costs also higher as a result. Partly offset by lower logistics costs, particularly fuel Translation benefit on USD denominated earnings Acquired additional farming assets in Guatemala towards the end of 2015. Expected to increase volumes by 25% in 2016 Pleased with initial integration of new farms. Positive start to 2015/16 US import season 30
Summary cash flow 2015 M M Operating cash flows Adjusted EBITDA 56.1 Exclude JV EBIT (1.7) Dividends from JV s 1.5 55.9 Recurring investment and other expenditure Maintenance Capex (9.6) Tax paid (4.3) Pension deficit payments incl MNOPF/MNRPF (1.9) Working capital / other (7.5) (23.3) Free cash flow before dividends 32.6 Dividends paid (7.4) Non recurring investment and other expenditure Acquisition of farming businesses (26.8) Farm purchase (2.7) Termination of Irish DB pension scheme (20.0) Non-recurring MNOPF/MNRPF payments (3.3) (52.8) Net cash outflow (27.6) Opening net debt (11.7) Strong cash generation in period. Operating cash flows of 55.9m, equivalent to 18.6 cent per share Significant investment expenditure in 2015 including 29.5m purchase of farming assets in banana and melon categories 20m paid to eliminate deficit in Irish DB pension scheme and all future liability. Accelerated pay down of new MNRPF liability Seasonal working capital compounded by acquisitions at end of year. Reduced by 6m repayment of supplier loans Closing net debt of 39.3m. Equivalent to 0.7 times Adjusted EBITDA Closing net debt (39.3) 31
Balance sheet 2015 M 2014 M Intangible assets 39.9 24.5 Property, plant and equipment 128.6 101.6 Investment in joint ventures 36.3 40.1 Investment in Balmoral 0.1 0.1 Working capital / hedging 87.6 77.9 Current / deferred tax (8.4) (10.2) Provisions (3.5) (4.0) Pension deficit (net of DT) (25.7) (34.0) Net debt (39.3) (11.7) 215.6 184.2 Shareholders funds 213.9 182.7 Minority interests 1.7 1.6 215.6 184.2 Significant high quality asset base own c.5,000 hectares of land in Central America Also owns 4 large distribution centres 3 in UK and 1 in Florida Reduction in pension deficit due to closure of Irish DB pension scheme. Also in process of closing larger UK DB pension scheme to future accrual 31.2m increase in shareholders funds, includes 17.1m translation gain on Sterling and US Dollar denominated net assets, plus 27.4m retained profits before 7.4m dividend 32
Attributable profit 2015 M 2014 M Adjusted EBITA 45.8 40.1 Net interest expense (incl joint ventures) (1.2) (1.1) Adjusted PBT 44.6 39.0 Exceptional items (12.0) 0.1 Amortisation - - Profit before tax 32.6 39.1 Taxation (incl share of joint ventures) (5.1) (5.0) Minority interest (0.1) (0.2) Profit attributable to shareholders 27.4 33.9 Underlying tax rate 13.8% (2014: 12.7%). Slight increase due to geographic mix of profits. 33
Adjusted earnings per share 2015 2015 M % Adjusted profit before tax 44.6 +14.5% Less: - Underlying tax (6.2) - Minority interests (0.1) Adjusted earnings 38.3 +13.4% Diluted weighted average shares (M) 301.2 Adjusted fully diluted earnings per share (cent) 12.73 +14.0% Excludes exceptional items and, in earlier years, amortisation charges and share of Balmoral result 34
Major shareholders Holder No. of ordinary shares % of shares in issue (excl treasury shares) InterTech South Carolina 39.0m 13.1% Balkan Investment Company (& related companies) 37.2m 12.1% Fidelity International Boston 31.2m 10.5% Invesco Limited USA 14.3m 4.8% BlackRock, Inc. London 13.6m 4.6% BNP Paribas Paris 11.9m 4.0% Farringdon Capital Management Copenhagen 11.4m 3.8% 35
Contact: Seamus Keenan Company Secretary Tel: +353 1 8872700 Email: skeenan@fyffes.com 36