PT MALINDO FEEDMILL TBK 2Q 2019 RESULT PRESENTATION 1
COMPANY OVERVIEW GUIDANCE INVESTMENT FOR FY2019 HIGHLIGHTS 2Q/2019 HIGHLIGHTS 1 Aug 5th, 2019
COMPANY OVERVIEW Vertically integrated business UPSTREAM MIDSTREAM DOWNSTREAM COMMERCIAL FOOD FEED BREEDING FARMING PROCESSING 2 Aug 5th, 2019
KEY INVESTMENT HIGHLIGHTS Attractive, fast growing industry Top 3 integrated player Secured growth plan Upside from Processed food (CBP) segment Highly experienced management with strong governance Productive age employees 3 Aug 5th, 2019
Investment highlight #1: Attractive, fast growing industry Indonesia’s middle class is growing, adding 80million people in the Chicken consumption in Indonesia keeps growing and forecasted middle class by 2020 to be even stronger in 2023 ('000 people) (‘000 tons) 271,000 264,000 265,000 2,382 242,500 217,500 2,141 80,000 Historical 60,000 58,080 45,000 Trajectory 15,225 2002 2010 2017 2018 2020 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Indonesia total population Middle class population Chicken is the most affordable animal protein after eggs Indonesia has one of the lowest chicken consumption in SE Asia 47.0 Protein 46.0 Chicken consumption per Price/kg Protein Price/g 38.8 capita (kg/ year) Protein source (IDR) content (IDR) Income per capita (USD1,000) Egg 23,500 12.5% 188 16.0 Chicken (broiler) 35,000 18.5% 189 13.6 10.6 10.5 9.0 Fresh milk 25,000 3.5% 714 5.8 3.6 2.5 2.0 1.5 0.8 Beef 190,000 20.0% 950 Fish 167,500 17.5% 957 Brunei Malaysia Thailand Philipines INDONESIA Vietnam Cambodia 4 Source: Badan Pusat Statistik (2018) and Indonesia Finance Ministry (2019) , Indonesia State Budget, FAOStats, BPS, IMF, USDA, Aug 5th, 2019 World Bank, Kompas daily, LEK Consulting, McKinsey, OECD, Company
Investment highlight #2: Top 3 integrated player and well-positioned in the market supported by strategic locations Indonesia DOC production capacity share (2018) Indonesia feed production capacity share (2018) CPIN 20% 25% CPIN JPFA 35% 38% JPFA MAIN 8% MAIN NEW HOPE 5% 4% NEW HOPE CJ 7% 8% Others Others 25% 25% 2019 Annual Legends Division Locations Capacity Feedmill 1,500,000 MT Cakung, Cikande, Gresik, Semarang, Makassar, Lampung GPS 3.2 mn DOCs Majalengka Breeding Medan, Lampung, Subang, Cikaum, Purwakarta, Wonosari, PS Breeding 258 mn DOCs Probolinggo, Lumajang, Pontianak, Banjarmasin, Makassar, Pekanbaru, Palembang, Rembang, Broiler 77.5 mn kg Medan, Subang, Bogor Food 9,000 MT Cikarang Processing 5 Aug 5th, 2019 Source: Company (2018)
Investment highlight #3: Growth plan with sufficient cashflow to fund capex Projected Capex of IDR 455 bn in 2019 will enable Malindo to capture the increasing demand Feed capacity (MT) DOC capacity (Mn birds) Broiler capacity (MT) CAGR 23,3% CAGR 2,3% 23 64 262 79 116 57 244 77 167 • Maximize the production utilization is • Expanding capacity to 77,500 tons in Expanding production capacity with a • expected to improve EBIT margin through FY2019 to support the growth in target of 270 Mio chicks in FY2019 economies of scale (target utilization in processed food & chicken consumption FY2019 : 75%-80% of optimal capacity) Malindo expects to add 7% - 10% • production volume per annum to support projected market recovery. 6 Aug 5th, 2019 Capex (IDR bn)
Investment highlight #4: Upside from Processed food (CBP) segment Consumer Foods capacity (MT) 5 2 0 7 Capex (IDR bn) Aug 5th, 2019
Investment highlight #4: Upside from Processed food (CBP) segment Reputation as high quality producer, solid track record with diverse customer base DISTRIBUTION MAP CUSTOMER AND OUTLET GROWTH 8 Aug 5th, 2019
Investment highlight #5: Highly experienced management with strong governance Lau Chia Nguang Tan Lai Kai Yongkie Handaya Koh Bock Swi Brian M. O ’Connor President Commissioner Commissioner* Independent Commissioner* Independent Commissioner* (Raymond Koh) Independent Commissioner* Year of Poultry Year of Poultry Year of Manufacture Year of Finance Year of Finance experience: experience: experience: experience: experience: More than 40 years More than 25 years More than 20 years More than 40 years More than 25 years Tan Sri Lau Dato’ Seri Abdul Mazlan Bin A. Talib Rewin Hanrahan Lau Joo Hwa Lau Joo Keat Rudy Hartono Husin Tuang Nguang Azim Bin Director* Director* Director Director Director* Mohd Zabidi President Director Director* Year of Poultry Year of Finance Year of Finance Year of Agriculture Year of Poultry Year of Poultry Year of Poultry experience: experience: experience: experience: experience: experience: experience: More than 15 years More than 15 years More than 20 years More than 20 years More than 30 years More than 25 years More than 30 years 9 *): Professional Aug 5th, 2019
Investment highlight #5: Highly experienced management with strong governance Tan Sri Lau Tuang Nguang President Director Lau Joo Hwa Lau Joo Keat Rudy Hartono Husin Rewin Hanrahan Aldrin Rungkat Hilda Wibowo Operation Director Finance Director* Breeder Farming Director Marketing Director* Feedmill Director* HR Director* 10 *): Professional Aug 5th, 2019
Investment highlight #6: Productive age employees Company's employee category by age 23% 40% 37% 20 - 29 years 30 - 39 years > 40 years 11 Aug 5th, 2019
2Q/2019 HIGHLIGHTS DOC & Broiler Average Selling Price Consumer demand projected to improve with Government initiatives ensuring stable DOC strong support by macro conditions & chicken prices and supply-demand GDP growth: 2020 5.3 – 5.6% (2019 c. 5.3%) dynamics Q2/2019 Feed margins to benefit from volume Consumer food volume continues increasing growth, particularly expanding to swine by boosting the sales through social media feed and duck feed 12 Aug 5th, 2019
FINANCIAL PERFORMANCE REVENUE NET PROFIT 6% 1H (Y-Y) 2Q (Y-Y) 38% 2Q (Y-Y) 21% 1H (Y-Y) 26% 155,263,582 145,914,772 3,872,160,644 3,072,632,302 88,112,772 1,927,343,881 1,598,789,197 54,585,386 Q2/2018 Q2/2019 1H18 1H19 Q2/2018 Q2/2019 1H18 1H19 EBITDA EBIT MARGIN 2Q (Y-Y) 5% 1H (Y-Y) 8% 8.6% 8.1% 14.0% 500,000,000 11.9% 12.3% 6.9% 393,900,130 12.0% 6.2% 400,000,000 365,452,721 10.2% 10.0% 9.7% 300,000,000 8.0% 196,318,023 187,169,875 6.0% 200,000,000 4.0% 100,000,000 2.0% 0.0% 0 Q2/2018 Q2/2019 1H18 1H19 Q2/2018 Q2/2019 1H18 1H19 EBITDA EBITDA (%) 13 Aug 5th, 2019
FINANCIAL PERFORMANCE NET DEBT/ EQUITY TOTAL ASSETS 4,599,675,653 2Q (Y-Y) 2% 0.87 12% 2Q (Y-Y) 0.85 4,098,695,092 Q2/2018 Q2/2019 Q2/2018 Q2/2019 CAPEX TOTAL INTEREST BEARING DEBT 10% 24% 1H(Y-Y) 2Q (Y-Y) 2Q (Y-Y) 9% 160,409,439 1,855,740,976 144,801,703 1,697,803,047 107,225,327 81,851,638 Q2/2018 Q2/2019 Q2/2018 Q2/2019 1H18 1H19 14 Aug 5th, 2019
SEGMENT PERFORMANCE FEEDMILL BREEDER SALES 34 % SALES 36 % SALES 28% SALES 14% 2Q (Y-Y) 1H (Y-Y) 1H (Y-Y) 2Q (Y-Y) 780.3 12.0% 3000 18.0% 800.0 10.6% 16.5% 2,421.1 16.0% 10.0% 700.0 2500 9.6% 608.0 14.0% 13.7% 600.0 1,786.1 8.0% 12.2% 2000 7.7% 12.0% 7.4% 500.0 10.0% 366.4 6.0% 1500 1,206.1 400.0 320.4 8.0% 901.5 4.5% 300.0 4.0% 6.0% 1000 200.0 4.0% 95.2 2.0% 83.6 500 233.6 53.0 136.7 2.0% 100.0 66.4 128.1 16.3 0.0% 0.0% 0 0.0 Q2/2018 Q2/2019 1H18 1H19 Q2/2018 Q2/2019 1H18 1H19 FOOD BROILER SALES SALES 8 % SALES 2 % 15 % SALES 3 % 2Q (Y-Y) 1H (Y-Y) 2Q (Y-Y) 1H (Y-Y) 72.4 0.00% 70.3 80.0 608.2 12.0% 660.0 598.3 10.2% 10.0% 60.0 -10.00% 560.0 8.8% 8.0% 39.9 34.6 6.0% 460.0 40.0 -20.00% 342.3 4.0% 314.8 360.0 -25.0% -26.1% 20.0 2.0% -30.00% 260.0 0.0% - -35.8% -2.0% 160.0 -40.00% Q2/2018 Q2/2019 1H18 1H19 53.7 -4.0% (20.0) 35.0 (10.4) -5.4% 60.0 (17.5) (18.1) -6.0% -6.1% -50.00% -50.6% (25.2) (40.0) (40.0) -8.0% Q2/2018 Q2/2019 1H18 1H19 (36.7) (16.9) (60.0) -60.00% 15 Aug 5th, 2019
GUIDANCE FOR FY2019 REVENUE NET PROFIT (IDR million) (IDR million) 300-330 7 ,100 – 7,300 284 6,706 2018 2019 2018 2019 EBITDA EBIT 9.50% (IDR million) 920-950 800 8-10% (IDR million) 13.50% 1,000 700 12-13% 13.00% 9.00% 760 650-700 531 800 600 12.50% 500 8.50% 600 12.00% 400 8.00% 11.50% 8% 300 400 11.3% 11.00% 200 7.50% 200 10.50% 100 7.00% 0 - 10.00% 2018 2019 2018 2019 EBIT EBIT MARGIN EBITDA EBITDA Margin 16 Aug 5th, 2019
THANK YOU www.malindofeedmill.com Sunny Gold @sunnygoldid @sunnygoldid
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