ANALYST MEETING Friday 17 th May 2019 DISCLAIMER This presentation - - PowerPoint PPT Presentation

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ANALYST MEETING Friday 17 th May 2019 DISCLAIMER This presentation - - PowerPoint PPT Presentation

ANALYST MEETING Friday 17 th May 2019 DISCLAIMER This presentation has been prepared exclusively for the purpose of the analyst meeting held on this 17 th May 2019 concerning Alteo Limited (the Company). This presentation contains only


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ANALYST MEETING

Friday 17th May 2019

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DISCLAIMER

This presentation has been prepared exclusively for the purpose of the analyst meeting held on this 17th May 2019 concerning Alteo Limited (the “Company”). This presentation contains only summary information and does not purport to be comprehensive. Participants are recommended to read the Company’s latest published condensed unaudited financial statements available on the Company’s website (www.alteogroup.com). The Company has used all reasonable endeavours to provide accurate information in this presentation. In the event of a discrepancy between this presentation and the published condensed unaudited financial statements, the latter shall

  • prevail. However, no responsibility whatsoever shall be accepted by the Company, its shareholders, directors, and officers for any

prejudice resulting from reliance upon the information contained in this presentation. This presentation contains statements related to our future business and financial performance and future events or developments involving Alteo that may constitute “forward-looking statements”. These statements may be identified by words such as "expect", "look forward to", "anticipate", "intend", "plan", "believe", "seek", "estimate", "will", "project" or words of similar meaning. Such forward-looking statements are by their nature based on the current expectations and certain assumptions of Alteo's management, and are, therefore, subject to certain risks and uncertainties. A variety of factors, many of which are beyond Alteo's control, may affect Alteo's operations, performance, business strategy and results and could cause the actual results, performance or achievements of Alteo to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements or anticipated on the basis of historical trends. Alteo neither intends, nor assumes any obligation, to publicly or otherwise update or revise these forward-looking statements in light of developments which differ from those anticipated. Alteo makes no representation whatsoever about the opinion or statements of any analyst or other third party. Alteo does not monitor or control the content of third party opinions or statements and does not endorse or accept any responsibility for the content or the use of any such opinion or statement.

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TABLE OF CONTENTS

GROUP FINANCIAL REVIEW MARKETS OUTLOOK

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GROUP FINANCIAL REVIEW

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Rs’ M March 2019 March 2018 % Change Turnover 6,827 6,250 9% Normalised EBITDA 1,715 1,774

  • 3%

EBITDA 1,836 1,977

  • 7%

PAT 472 618

  • 24%

PAT attributable to owners

  • f parent

47 113

  • 58%

EPS (Rs) 0.15 0.36

  • 58%

DPS (Rs) 0.32 0.35

  • 9%

5

ANALYST MEETING

GROUP PROFITABILITY REVIEW

INCOME STATEMENT FOR THE PERIOD ENDED MARCH 31

Better sales achieved by Kenyan sugar

  • perations and

Property cluster Lower gains on sale of land and higher finance costs for East African sugar operations Excludes crop 2017 insurance compensation and gains on sale of land

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PAT BY CLUSTER (in Rs’ M)

406 81

  • 16

677 93

  • 152
  • 200
  • 100

100 200 300 400 500 600 700 800 Sugar Energy Property 2019 2018

Sugar: Drop in results mainly driven by lower profitability on sales of imported sugar by TPC Energy: Lower profitability with

  • nly
  • ne

plant

  • perating in the third quarter following the ceasing of

CEL’s operations in December 2018 Property: Results continued to improve with higher property sales revenue recognition (43% works completion on 8 villas and the sale of 4 serviced plots signed)

ANALYST MEETING

GROUP PROFITABILITY REVIEW

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SUGAR CLUSTER PROFIT (in Rs’ M)

  • 251

780

  • 123
  • 155

1120

  • 288
  • 400
  • 200

200 400 600 800 1000 1200 Mauritius Tanzania Kenya 2019 2018

Mauritius: Lower price environment together with lower volume produced. Prior year’s losses included substantially higher negative movements on FV off biological assets Tanzania: Higher volume sold but lower margins on sales of imported sugar by TPC Kenya: Better price environment together with higher cane availability contributed to improved results. Losses include finance costs on acquisition debt contracted by holding company (SML) Sugar (Rs M)

2019 2018

Reported PAT (251) (155) Non recurring items 123 200 Normalised PAT (374) (355)

ANALYST MEETING

GROUP PROFITABILITY REVIEW

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GEARING (in Rs’ M)

2,778 5,567 5,061 6,222 6,155 19,469 19,291 19,454 19,035 19,226 12% 22% 21% 25% 24% 0% 5% 10% 15% 20% 25% 30%

  • 5,000

10,000 15,000 20,000 25,000 Jun 2015 Jun-16 Jun-17 Jun-18 Mar-19 Net Debt Equity Gearing

Group gearing stood at 24% at March 31 2019

NET DEBT BY COMPANY (in Rs’ M)

1290 1309 360 1653 558 944 41

SML TSC Alteo AAL AML Aestl Others

Sucriere des Mascareignes Transmara Sugar Co Ltd Alteo Limited Alteo Agri Ltd Alteo Milling Ltd Anahita Estates Ltd

ANALYST MEETING

GROUP DEBT REVIEW Rs1.5bn issue under new Note Programme is mostly for refinancing of short term facilities

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9

CASH FLOWS FOR THE PERIOD ENDED MARCH 31

(1,288) (771) 442 (389) 454 419 (409)

July 1 2018 Cashflows from

  • perations

Capital expenditure Sale of assets and investment Net borrowings Dividend paid March 31 2019

Mostly proceeds from sale of land by Alteo Agri

ANALYST MEETING

GROUP CASH FLOW REVIEW

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MARKETS

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EU MARKET SUGAR PRICES – MAURITIUS (ex MSS)

  • Excludes support measures from Government

GLOBAL SUGAR SURPLUS/ DEFICIT

Million’ tons Rs’000

17.6 15.8 12.7 13.0 15.6 11

8.8

8 10 12 14 16 18 20 2012 2013 2014 2015 2016 2017 2018

* * * *

3.3

  • 10.8
  • 2.8

1.7 6.6 7.6 6.0 2.2

  • 5.1
  • 3.7

7.8 0.6

ANALYST MEETING

MARKETS

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OUTLOOK

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  • Mauritian sugar operations will continue to be affected by adverse

price conditions on the EU market, however…

  • Crops 2017 & 2018 have been declared event years and insurance

compensations will mitigate losses

  • Sugar cluster assets in Mauritius are currently being tested for

impairment – any impairment booked in Q4 will impact EPS

  • The enhanced cane availability and improved average domestic

price are expected to continue to be beneficial to the Kenyan

  • perations in Q4
  • In Tanzania, sales of own produced sugar should catch up with last

year’s volume in Q4 as stock is cleared

FINANCIAL YEAR

ANALYST MEETING

SUGAR OUTLOOK

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  • Early indications that crop 2019 in Mauritius will be better than

2018 and prices picking up on the EU market

  • Restructuring
  • f

Mauritian agri

  • perations

is

  • ngoing

– Abandonment of unviable manual fields as from crop 2019 to drive down cost of production and accelerate shift to 100% mechanisation

  • Mitigating lower throughput for the mill with cane from Medine

factory area and additional special sugar production

  • Continued efforts in Kenya to further develop area under cane,
  • ptimize factory capacity and achieve economies of scale
  • Gap sugar import in Tanzania reduced from 130Tk to 38Tk
  • Distillery project at TPC progressing well – validation expected by

December 2019

BEYOND

ANALYST MEETING

SUGAR OUTLOOK

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  • Energy cluster’s year end results are expected to be lower than

last year with less contribution from CEL and higher depreciation at AEnL

FINANCIAL YEAR BEYOND

  • AEnL’s power purchase agreement renewed for another 3 years
  • Negotiations with CEB for new power plant project progressing

well

ANALYST MEETING

ENERGY OUTLOOK

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  • Improving trend expected in Q4 as construction of villas sold off

plan progress and sales of several serviced plots are signed

FINANCIAL YEAR BEYOND

  • On target to achieve the completion of Anahita within the next 3
  • years. Debt of Rs900m repaid and some Rs700m up streamed to

Alteo

  • Strategic master planning exercise has been completed, priority

development nodes earmarked (Old Beau Champ factory zone and Beau Rivage site)

ANALYST MEETING

PROPERTY OUTLOOK

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Q & A

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THANK YOU

Alteo Limited – Head Office Vivéa Business Park, St Pierre, 81430, Mauritius Phone: (230) 402 9050 Fax: (230) 432 0729 info@alteogroup.com