PRESENTATION AGROSUPER M A R C H 2 0 1 9 AG E N DA AGRO GROSUPER - - PowerPoint PPT Presentation

AGROSUPER PRESENTATION

M A R C H 2 0 1 9

AG E N DA

• AGRO

GROSUPER SUPER AT A GLANCE

• OUR BUSI

BUSINESS NESS MO MODEL DEL

• NEW ACQ

CQUI UISI SITI TIONS NS

• FINA

NAL L CO CONSI NSIDERA DERATI TIONS NS

AG R O S U P E R AT A G L AN C E

STABILITY AND FINANCIAL SOLVENCY

Income 2018

US$ 2,6 BN

CAGR(1) ’10-’18 7,2%

EBITDA 2018 US$ 433 MM

CAGR(1) ’10-’18 6,9%

NFD(2) 2018 US$ 404 MM

DFN / EBITDA 1,0x

Equity 2018

US$ 1,7 BN

CAGR(1) ’10-’18 6,0%

4 US$ 875 MM US$ 919 MM US$ 165 MM US$ 224 MM US$ 385 MM

THE LEADING FOOD COMPANY IN CHILE

AGROSUPER 2018

US$ 1,3 BN

US$ 3,5 BN

US$ 621 MM US$ 879 MM

US$ 2,2 BN

PRO FORMA PRO FORMA

(1) CAGR: Compound annual growth rate (2) NFD: Net Financial Debt Exchange Rate (Balance Sheet ) $694,77. Exchange Rate (Income Statement) $640,29.

First exports of chicken and pork.

OUR GROWING HISTORY

1974 1983 1989 1990 2002 2011 2018 1955 1960 1996

Gonzalo Vial founded Agrosuper as a chicken egg producer Acquired Friosur assets (Salmon)

2019+

SUCCESSFUL TRACK RECORD IN INDUSTRY

5 Live Chicken producVon and distribuVon

• Charcuterie (ham/

sausages) and Salmon businesses were launched Chicken processing begins Pork ProducNon starts Agrosuper acquired a relevant share of Sopraval S.A. and began its Turkey business Agrosuper reached 99.8% of Sopraval S.A. through a successful Secondary PO Acquired AquaChile (Salmon) and reached 99.7% of property through a successful Secondary PO First InternaNonal Offices, beginning in Italy

29 47 48 77 109 132 148 153 195 232 215 248 281 278 283 292 333 305 360

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

CAGR: 15,1% OUR GROWING HISTORY

SUCCESSFUL TRACK RECORD IN INDUSTRY

6

Ex Expo port rt Ev EvoluMon ( (Th Thou

• usands of
• f to

tonnes) )

(1) CAGR: Compound annual growth rate Exchange Rate $640,29.

FO FOOD INDUSTRY AVERAGE 22,0% PR PROTEIN INDUS EIN INDUSTRY A Y AVERA VERAGE 8,1% E 8,1%

CONSISTENTLY SUPERIOR MARGINS AMONG ITS COMPETITORS AND PEERS

COMPANY LEADER IN FOOD SEGMENT

7

» Recognized performance in developed markets and greater exposure in emerging markets » High quality standards and product specializaVon » VerVcal integraVon in the enVre producVve and commercial processes » Preferred brand in local market and internaVonal specialized niches

Sources: Agrosuper, Bloomberg. (*) Campofrío 2017 and JBS est.

34,7% 27,5% 26,5% 21,1% 20,1% 20,1% 18,2% 7,7% 14,4% 10,8% 8,7% 8,3% 7,9% 7,4% 7,4% 4,3% 3,6% 16,8%

O U R B U S IN E SS M ODE L

VerNcal IntegraNon & Traceability

3.

Solid Financial PosiNon & OperaNonal Efficiency

4.

9

The Right Industry

1.

Leader in Food Segment

2.

Sustainability

6.

Atractivos de Inversión

InnovaNon & Development of Product

5.

THE CORNERSTONE OF OUR BUSINESS MODEL

COMPETITIVE PILLAR

20 40 60 80 100 120

2012/14 2024 2012/14 2024 2012/14 2024

Animal Vegetal

Emerging Markets Less developed countries Developed countries

10

grams / person / day

AND THE RIGHT PROTEINS

• 1. THE RIGHT INDUSTRY

INCRE INCREAS ASE OF ANIMAL PR E OF ANIMAL PROTEIN C TEIN CONS ONSUMP UMPTION TION ConsumpNon Per Capita Worldwide » As GDP increases, the consumpVon of protein rises

• too. Amplified by the growth in the urbanizaVon

rate and the middle class populaVon. » There is a strong trend for healthy food, where white meats and fish are most preferred » Biosecurity: Natural barriers and sustainability plus a strong regulatory framework » Climate and geographic advantages » Long and stable insVtuVonal reputaVon » Worldwide commercial agreements CHILE: CHILE: A C A COUNTR OUNTRY OF C Y OF COMPETITIVE OMPETITIVE AD ADVANT ANTAGE GES

50,6% 29,1% 20,2%

11

• More than 2.030

2.030 products, with the highest standards in quality and product specializaNon.

53,6% 29,6% 16,8%

Main producer of Chicken, Pork and Turkey.

80,0% 11,6% 8,4%

Lo Local al mark market lead leader er(1)

(1)

Agrosuper Others Other’s imports.

US$ 629 MM US$ 473 MM US$ 77 MM

RECOGNIZED PERFORMANCE WITH STRONG BRANDS

• 2. COMPANY LEADER IN FOOD SEGMENT

Sources: Agrosuper. Exchange Rate $640,29 (1) Market Share 2018 by kg.

#1 #1 #1

Sales 2018: US$ 2,6 BN

12

DIVERSITY OF PRODUCTS, MARKETS AND CLIENTS

• 2. DIVERSIFICATION AND STRONG BRANDS

SA SALES BY BUSINESS AREA SA SALES BY MARKET

Sales 2018: US$ 2,6 BN

MA MAIN CUS IN CUSTOMER MERS S

None of the customers represents more than 9% of the sales

DIS DISTRIBUTION OF EX TRIBUTION OF EXPOR PORTS B S BY BUSINE Y BUSINESS SS

34% 35% 6% 15% 9% 1%

Chicken Pork Turkey Salmon Processed Meat Other

56% 44%

National Export

21% 39% 8% 31% 1%

Chicken Pork Turkey Salmon Processed Meat

8,8% 8,2% 5,7% 3,3% 2,2% 1,5% 1,3% 1,2% 0,9% 0,9% 0,8% 0,8%

1 2 3 4 5 6 7 8 9 10 11 12 Sources: Agrosuper. Exchange Rate $640,29

25% 26% 5% 37% 6% 1%

Chicken Pork Turkey Salmon Processed Meat Other

Sales 2018 Pro Forma: US$ 3,5 BN

12% 23% 5% 60%

Chicken Pork Turkey Salmon Processed Meat

43% 57%

National Export

Sales 2018 Pro Forma: US$ 3,5 BN

Commercial offices

Anexos

13

ASIA EUROPA AMÉRICA CHILE ÁFRICA 8,7% Corea del Sur 7,6% Rusia 5,0% México 18,8%E E.UU 28,4% Otros 17,0% China 14,5% Japón

DIVERSITY OF PRODUCTS, MARKETS AND CLIENTS

• 2. DIVERSIFICATION AND STRONG BRANDS

13

FEEDI EEDING NG BREEDI BREEDING NG PRO PROCESSI CESSING NG DI DISTRI STRIBUTI BUTION N PO POINTS NTS OF SA SALES LES FINA NAL L CO CONSUMER NSUMER

OWN WN BREEDI BREEDING NG FOR R CO COMMERCI MMERCIAL L LI LIVESTO ESTOCK CK

MO MORE RE THA THAN N 1 1 MI MILLI LLION N TO TONNES NNES IN N PRO PRODUCTI DUCTION N CA CAPA PACI CITY TY

• 3. VERTICAL INTEGRATION AND TRACEABILITY

TRACEABILITY IN THE WHOLE VALUE CHAIN AND CAPTURE OF MARGINS WITH BIOSECURITY

14

29

Local Distribu0on Centers

Presence in 67 countries worldwide 6 InternaYonal Offices

15

• 3. VERTICAL INTEGRATION AND TRACEABILITY

STRONG DISTRIBUTION CHAIN – CLOSE CONTACT WITH OUR CUSTOMERS

Hong Kong, China Shanghai, China Tokyo, Japan Genova, Italia Atlanta, USA Mexico City, Mexico O´Higgins Region Arica and Parinacota Region Tarapacá Region Antofagasta Region Atacama Region Coquimbo Region Valparaíso Region MR Maule Region Araucanía Region Los Ríos Region Los Lagos Region Bio Bio Region Aysén Region Magallanes Region

» Technological improvement and biosecurity reinforcement in all producKve faciliKes » Increased producKvity in animal producKon and processing plants » Updated models for primary and secondary distribuKon systems » IncorporaKon of new SAP modules in order to integrate the whole value chain » Search of energy efficiencies and producKvity » In 2015, Agrosuper hired Agri Stats, a US company that provides specialized benchmark services for the protein industry in various countries. This benchmark has allowed Agrosuper to idenKfy its compeKKve advantages,

• peraKonal and costs opportuniKes in the whole value chain.

» Based on this benchmark, Agrosuper has been able to beVer align its investments and improvement iniKaKves with its strategy.

INTERNATIONAL BENCHMARK WITH THE INDUSTRY EFFICIENCY AND PRODUCTIVITY PROJECTS

• 4. SOLID FINANCIAL POSITION AND OPERATIONAL EFFICIENCY

FOCUS IN THE OPERATIONAL EFFICIENCY GIVES POSITIVE RESULTS

16

1,15 1,43 1,41 1,48 1,75 1,85 2,00 2,34 2,36 2,56 2,45 2,58 12% 11% 6% 17% 18% 8% 12% 18% 17% 18% 20% 17%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Ingresos

• Mg. EBITDA
• 91

70 70 204 112

• 18

219 336 293 308 309 155 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

17

Aquaculture general health event Turkey event (avian flu) Asian ban in Pork Market Ability to delay CAPEX Ability to delay CAPEX Pork Facility paralizaVon Poultry event

CONSTANTLY GROWTHING AND STRONG CASH FLOW GENERATION

• 4. SOLID FINANCIAL POSITION AND OPERATIONAL EFFICIENCY

Sus Sustainable ainable gr growth th in in Sales (USD BN) Sales (USD BN) EBIT EBITDA – CA – CAPEX PEX (USD MM) (USD MM)

17

Aquaculture event (ISA Virus)

EBITDA 139 151 91 254 309 155 245 421 395 470 489 433 CAPEX 230 80 22 50 197 173 26 85 102 161 180 278

Poultry event Earthquake

18

NET FINANCIAL DEB NET FINANCIAL DEBT / EBITD T / EBITDA A NET FINANCIAL DEB NET FINANCIAL DEBT / E T / EQUITY QUITY

• 4. SOLID FINANCIAL POSITION AND OPERATIONAL EFFICIENCY

CONSTANTLY GROWING AND STRONG CASH FLOW GENERATION

18 3,06 3,64 4,96 1,42 1,94 4,43 2,39 0,90 0,89 0,11 0,23 1,01

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

0,38 0,42 0,37 0,31 0,47 0,68 0,53 0,29 0,25 0,03 0,07 0,23

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Sources: Agrosuper. Exchange Rate $640,29

NEW PRODUCT DEVELOPMENT RATE SALES OF PRODUCTOS CREATED IN THE LAST 3 YEAR / MOBILE SALES (LTM)

» In order to understand the new consumpVon habits and trends we focus in developing a deep understanding and involvement with our consumers » The new product development rate allow us to maintain an innovate and akracVve porlolio for our customers and consumers

• 5. INNOVATION AND DEVELOPMENT OF NEW PRODUCTS

INNOVATING AND ADAPTING TO THE NEEDS OF OUR CUSTOMERS

10,33% 8,61% 9,60% 12,62% 11,50% 12,10% 12,29% 2012 2013 2014 2015 2016 2017 2018

19

Community relaNonship

100% of the producVve instalaVons of Agrosuper are linked to different local public audiences.

EducaNon / Healthy life / Entrepreneurship

Permanent commitment with the strengthening of educaVon at elementary, middle school and high school

Animal Welfare Policy Responsible ProducNon with the Environment

Minimizing our own impacts of our operaVons

20

• 6. SUSTAINABILITY AND RESPONSIBLE PRODUCTION

COMMITMENT WITH THE COMMUNITY AND ENVIRONMENT

Petorca 65% of the total emissions 2013-2017

Environmental Expenses & Investments 2013-2017

USD 406 MM

Ra Rapel el 94% of the total emissions 2013-2017

EVOLUCIÓN RESULTADOS TRIMESTRALES: SEGMENTO ACUÍCOL

NUESTROS RESULTADOS REFLEJAN LA RECUPERACIÓN DE LA INDUSTRÍA SALMONERA

N E W A C Q U I S I T I O N S

USD 1,5 BN IN NEW ACQUISITIONS

» AQUACHILE » FRIOSUR » SALMONES MAGALLANES

22

NEW INDUSTRY IN AQUACULTURE SEGMENT: SALMON

PERSPECTIVES IN THE SALMON INDUSTRY

• Chile is now in a new phase of growth and development
• Significant advances and breakthroughs in a sustainable

regulatory framework

• Greater awareness of sanitary condiVons
• Chile is one of the few countries in the world with opVmal

condiVons for the producVon of salmonidae

• Balance in the supply of salmon in the last decade and a posiVve

forecast of low growth rates

• The posiVve akributes of salmon meat posiVons it as an

akracVve protein for healthy consumpVon trends.

• ProducVon efficiency and low impact to the environment can be

translated as a sustainable producVon model of this protein

Fuente: FAO, Salmon Farming Industry Handbook 2018 de Marine Harvest, Salmon World 2018 de Kontali. (1) Ranking Ebit/Kg WFE U12M (dic-15 y mar-18), Aquachile, Blumar, Invermar, Australis, MulMexport, Camanchaca; (2) CAGR Compound annual growth rate.

23

368 1.114 2.000 2.340 1995 2005 2017 2021

C A C A G R G R(2)

(2) ‘95 –

– ‘ ‘ 5 5 : : 12%

12%

CA CAGR GR(2)

( 2 ) ‘05 –

– ‘17: 5%

5%

CAGR(2) ‘17 – – ‘21E: 4% %

At AtlanMc Salmon Supply Supply EsMma EsMmates es (‘000 t (‘000 ton

• n WFE)

WFE)

Ex Expec pected ed re reducMon in in the the supply supply gr growth th

Ne New R w Regu egulator

• ry En

y Envi viron

• nmen

ment a and Id Idea eal p prod

• ducM

cMon

• n c

con

• ndiMon
• ns

s

NEW INDUSTRY IN AQUACULTURE SEGMENT: SALMON

OUR RATIONALE TO INVEST IN THIS INDUSTRY

ü OperaVonal reestructuring to impact costs ü Now within the 25% best industry costs ü Follow-up on operaVonal efficiency

# # 7 Comp

mparable Ch Chilea ean En Enterprises erprises Benchma mark (1)

(1)

ü Like chicken, pork and turkey, salmon also enters in an economies of scale frame

#2 #2 Comp

mparable Ch Chilea ean En Enterprises erprises Benchma mark (1)

(1)

2015 2016 2017 2018

1989: Salmon business at Los Fiordos was launched

Fuente: FAO, Salmon Farming Industry Handbook 2018 de Marine Harvest, Salmon World 2018 de Kontali. (1) Ranking Ebit/Kg WFE U12M (dic-15 y mar-18), Aquachile, Blumar, Invermar, Australis, MulMexport, Camanchaca; (2) CAGR Compound annual growth rate.

24

Ag Agros

• super

er’s Salmon Salmon tu turn rn ar arou

• und in

in its Cos its Cost Stru t Structu cture e

To become me mo more comp mpeMMve

CONSOLIDATION IN THE SALMON INDUSTRY

ACQUISITION OF FRIOSUR, AQUACHILE AND SALMON MAGALLANES

1.087 521 157 146

52% 46% 95% 96%

• 40%
• 20%

412 182 175 154 150 107 80 76 70 68 62

Marine Harvest Agrosuper pro-forma* Leroy Cermaq Salmar Cooke AquaChile MulVexport Grieg Australis Los Fiordos

WORLD´S SECOND PRODUCER OF SALMON

320 320 lic licenses enses in in pr produc ducMv Mve zo zones

XV II III IV V RM VI VII VIII IX XIV XII X XI XII

26 26 3 3 101 101 95 95 55 55 ProducVve Zones

# licenses in Los Fiordos # licenses Friosur # licenses S. Magallanes # licenses AquaChile

40 40 Source: Agrosuper, Annual Reports, “Salmon World 2018” Kontali.

ü Through the acquisiVon of Friosur, Aquachile and Salmones Magallanes, consolidates Agrosuper as the major producer and naVonal exporter and the second major producer of salmon in the world. ü New industry of salmon – Adequate regulaVons and producVve consolidaVon leads to a sustainable operaVon. ü Economies of scale benefits technological and geneVc investments and allows relevant logisVcal and operaVonal savings.

Aggregated ProducVon due to geography (‘000 ton GWT) Aggregated market share of top 5 enterprises per country

XI

Norte América

Pr Pro-forma rma Pr ProducMo ducMon 2017 (‘000 WFE) 2017 (‘000 WFE) Con Consolid solidaM aMon

• n of
• f the

the In Industry Wo Worldwide

25

F I N A L C O N S I D E R A T I O N S

FINAL CONSIDERATIONS

» INTEGRATION OF LAST ADQUISITIONS WITH FOCUS ON SYNERGIES AND ECONOMIES OF SCALE ADVANTAGES » WITH MORE THAN 50% OF INTERNATIONAL SALES AND A STRONG WORLDWIDE NETWORK, BASE FOR FUTURE INTERNATIONAL GROWTH » GOOD PERFORMANCE OF THE AQUACULTURE SEGMENT, WHICH WE BELIEVE WILL CONTINUE DURING 2019 » POSITIVE PERSPECTIVE IN MEAT SEGMENT WITH GROWING INTERNATIONAL DEMAND, FOCUS IN ASIA AND EMERGING MARKETS » GRAIN PRICES ARE FORECASTED STABLE IN 2019, CONSIDERING GOOD HARVEST PERSPECTIVES » SUSTAINED IMPROVEMENT OF OPERATIONAL EFFICIENCY WILL ENSURE COMPETITIVENESS FOR FUTURE YEARS » POSITIVE RESULTS AND STRONG CASH FLOW GENERATION WILL ALLOW US TO REDUCE NET FINANCIAL DEBT LEVEL IN THE SHORT TERM

THANKS!