COMVITA LIMITED INVESTOR PRESENTATION 2013 Neil Craig, Chairman, - - PowerPoint PPT Presentation

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COMVITA LIMITED INVESTOR PRESENTATION 2013 Neil Craig, Chairman, - - PowerPoint PPT Presentation

Mar 02, 2023 25 likes •360 views

COMVITA LIMITED INVESTOR PRESENTATION 2013 Neil Craig, Chairman, Ph. 021 731 509 Brett Hewlett, Chief Executive O ffl cer, Ph. 021 740 160 2014 Half Year Update NZD $000S 6 MONTHS ENDED 6 MONTHS ENDED 30 SEPT 2013 30 SEPT 2012 Sales

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COMVITA LIMITED INVESTOR PRESENTATION 2013 Neil Craig, Chairman, Ph. 021 731 509 Brett Hewlett, Chief Executive Offlcer,

  • Ph. 021 740 160
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2014 Half Year Update

2 NZD $000’S

6 MONTHS ENDED 30 SEPT 2013 6 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) 4.00 4.00

*EBITDA: Earnings Before Interest, Tax, Depreciation and Amortisation

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Achievements – 2014 Half Year

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Outlook

  • Second half year sales expected to be >60% of total
  • Strong growth in key Asian markets
  • MedihoneyTM

TM wound care sales growth

  • Net earnings and Sales expected to exceed 2013
  • 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
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The following pages are from the May 2013 Investor Presentation

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Financial results for the year to 31 March 2013 $M 2012 $M Change % Revenue 103.5 96.0 7.8% EBITDA* 14.7 15.5 (5.2%) Net profit after tax 7.4 8.2 (9.8%) Earnings per share (cents) 25.7 29.1 (11.7%) Dividends (cents) 13.0 14.0 (7.1%)

*EBITDA: Earnings Before Interest, Tax, Depreciation and Amortisation

Comvita Results at Upper End of Guidance

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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 Key Ratios 31-03-2013 31-03-2013 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%

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Financial Performance

Group Revenue EBITDA**

2005 2006 2008 2009 2010 2011 2012 2013

$31m $85m $82m $96m $103m $15.5m $14.7m $71m $65m* $39m $6.3m $11.2m $5.3m $0.4m* $4.8m $4.1m

2005 2006 2008 2009 2010 2011 2012 2013

* 15 month period, due to change in balance date. ** EBITDA – Earnings before interest, tax, depreciation, amortisation, impairments and fair value movements of financial instruments.

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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

  • f diabetes
  • New health claim and product offering

for fresh Olive Leaf Extract opens new market opportunities

  • International research papers provide

further support for wound healing technologies

  • China propolis Blue Hat registration
  • 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-off with positive results
  • Continued strong growth in the medical honey category

Achievements

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Sales by Region

$45.3m $6.4m $6.1m $24.5m $21.2m

ASIA AUSTRALIA NEW ZEALAND UK/EUROPE NORTH AMERICA

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Sales by Category

42% 4% 1% 48% 5%

HEALTHCARE FUNCTIONAL FOODS PERSONAL CARE MEDICAL OTHER

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Outlook

  • Restored earnings growth
  • Continued strong growth in key Asian markets
  • Online and retail sales developments
  • Continued efforts 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

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Evolving Our Business

2013 2005 Sales $103m $31m Gross Margin% 56% 34% EBITDA $14.7m $4.1m Assets $137m $50m Employees 395 140 % Sales Export 80% 60% % Sales via Distributors 16% 85% % Sales Honey 47% 65% % Sales B2C 26% 3%

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Market Segments

Manufactures, markets and distributes natural health and beauty products across four key broad market segments

Variety of healthcare products designed to compete with traditional

  • ver-the-counter (OTC)

pharmaceutical products Key Products:

  • Olive Leaf Extract
  • Propolis
  • Winter Wellness
  • Bee Pollen
  • Royal Jelly

HEALTHCARE 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

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

PERSONAL CARE MEDICAL

Medical-grade leptospermum (Manuka) honey for treatment of chronic wounds Global licensing deal for Medihoney with Derma Sciences Key Products:

  • Medihoney medical

products

42% 48% 5% 4%

* Does not total to 100% as it excludes ‘Other’ business unit which accounts for remainder for the 12 months to 31 March 2013

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Value Added

Comvita branded health honey Generic Medical Skincare

$5* $14 $104 $330 $500

* Retail selling price per 250g equivalent of raw Manuka honey

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Bottom Standard Layout

Without Frond Without Frond

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Manuka Honey

  • 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

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Fresh Olive Leaf

  • 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’

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Specialist Manufacturing

  • 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

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Natural Health Innovators

  • FDA approved and CE marked medical devices
  • A total of 61 patents or patents pending covering

13 difierent unique innovations in wound care applications

  • 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

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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

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Building a Premium Global Brand

  • Brand reputation in Asia allows significant price

premium over nearest competitors

  • Brand ofier on focussed, difierentiated ingredient

platforms

  • Brand story has great level of meaning with customers
  • Source and efflcacy of product range
  • Growth and awareness opportunity through tapping

into New Zealand tourism via brand experiences

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Consumer Needs Focus Design

  • Large scope to further broaden product ofiering
  • Foods, healthcare, personal care, medical
  • Very large global natural products sector
  • Asian focus
  • Global trends support growth
  • Ageing populations
  • Growing preference to self-medicate
  • Increased incidence of degenerative diseases
  • Tightening regulations eliminating less

scrupulous competition

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Diversity and Reach of

Direct Channels a Real Strength

  • !

Established wholesale business in UK, Australia, NZ

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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

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Auckland Concept Store

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Experience Comvita

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Manuka Honey

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Propolis & Royal Jelly

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Winter Wellness

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Fresh Olive Leaf Complex

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Skin Care

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Medihoney

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