annual general meeting - zeder - agm 2013 present… · • bio fuels • non-food (i.e. rubber,...
TRANSCRIPT
Annual General Meeting
Presented by:
Jannie MoutonChairman
21 June 2013
General matters
• To accept the presentation of the audited
annual financial statements for the year ended
28 February 2013
Ordinary resolutions
• To re-elect the following directors:
– Resolution 1: Jannie Mouton
– Resolution 2: Michiel le Roux– Resolution 2: Michiel le Roux
– Resolution 3: Norman Celliers
– Resolution 4: Antonie Jacobs
3
Ordinary resolutions
• To re-appoint the following members to the
audit and risk committee:
– Resolution 5: Michiel le Roux– Resolution 5: Michiel le Roux
– Resolution 6: George Eksteen
– Resolution 7: Lambert Retief
4
Ordinary resolutions
• Resolution 8:
To re-appoint PwC as the auditor
5
Ordinary resolutions
• Resolution 9:
General authority to issue ordinary shares for cash
6
Special resolutions
• Special resolution 1:
Inter-company financing
• Special resolution 2: • Special resolution 2:
Financial assistance for the acquisition of shares in a
related or inter-related company
7
Special resolutions
• Special resolution 3:
Share buy-back by Zeder and its subsidiaries
• Special resolution 4: • Special resolution 4:
Conversion of authorised and issued share capital to
shares of no par value
8
Special resolutions
• Special resolution 5:
Increase of the authorised ordinary share capital of
the company
• Special resolution 6:
Consequential amendments to the memorandum of
incorporation of the company
9
Investor Presentation
Presented by:
Norman CelliersChief executive officer
21 June 2013
Thank you.Thank you.
• Long term value investor with a primary focus on
Agribusiness, specifically the food and beverage sectors
• Listed on the JSE – ZED - hybrid private equity vehicle
Our business
INTRODUCTION
• Key characteristics of investment considerations: – Growth sectors or subsectors
– Management with proven track record
– High barriers to entry
– Unique and defendable products (brands)
– Simple (easy to understand)
– Scalable business models
– Focused execution
South Africa (Direct)
Historically
Geography: South Africa (Direct)
Going forward
• AgribusinessIndustry: • Agribusiness
• Food and BeveragesSub-sector: • Food and Beverages
• Bio Fuels
• Non-food (i.e. Rubber, timber)
Expanded strategy
INTRODUCTION
• South Africa (Direct)
• Rest of World (via portfolio)Geography: • South Africa (Direct)
• Sub-Sahara Africa (Direct)
• Rest of World (via portfolio)
• Arbitrage
• UndervaluedCriteria: • Arbitrage
• Undervalued
• Growth sectors
• Consolidation
• PassiveInfluence: • Passive
• Active
Invest in and build the businesses of tomorrow
PERFORMANCE REVIEW
Summary results FY20132012 2013
Sum of the parts
Sum of the parts per share
R3,084m
R3.15
R3,903m
R3.9926.7%
Recurring headline earnings
Recurring headline earnings per share (cents)
R273,0m
27.9
R251,1m
25.77.9%
Headline earnings
Headline earnings per share
R299,9m
30.7
R196,3
20.134.5%
Attributable earnings
Attributable earnings per share
R334,6
34.2
R511,7
52.352.9%
Dividend
Dividend per share
R39m
4.0
R39m
4.0
• Grown from R350m tot R3,9 billion in 6,5 years
• Initially acquired many small portions of undervalued shares (low P/E’s)
PERFORMANCE REVIEW
Growth in portfolio
3,000.00
3,500.00
4,000.00
4,500.00
Other financial instruments
Nett Cash
Chayton
Outspan
Senwes
Pioneer
* End of calendar year 2012
-
500.00
1,000.00
1,500.00
2,000.00
2,500.00
3,000.00
2006 2007 2008 2009 2010 2011 2012 2013
Pioneer
Tuinroete Agri
BKB
OVK
NWK
Suidwes Beleggings
Capespan
Overberg Agri
KLK
Agricol
MGK
KWV Holdings
0
250
500
349277
206
37 17
PERFORMANCE REVIEW
Investments and disposals
R’m
Investments made during FY13: R538m
Investments made since YE: R349m
R887m
-1,000
-750
-500
-250
0
-154
-799
Capespan Chayton ZAAD Kaap Agri AVB Other CVH
Disposals made during FY13: R953m
CVH*: R700m profit / IRR = 19.4% over 6.5 years
* Includes entire shareholding and assumption that remaining 5% is sold at same price
1,000
1,5001,475
R’m
Portfolio weighting
PERFORMANCE REVIEW
-500
0
500
633
369 349 343288 277
224
107 90 54
-301
AVB
Capespan*
Agricol
Cash*
Kaap A
gri
CVH
Chayto
n
NW
K
Overb
erg
Suid
wes
Oth
er
Net
Lia
bilitie
s
* Adjusted for transactions since yearend as published
Portfolio interests
PERFORMANCE REVIEW
• Strong assets
• Leading brands
Corporate and consumer brand exposure
PERFORMANCE REVIEW
• Leading brands
• Good management
• Growth potential
Historical overview
PERFORMANCE REVIEW
285
257
340
274
315
399
300
350
400
450
25
30
35
Recurring headline earnings
(Cents per share)
SOTP & Share price
(Cents per share)TSR = 16.2%
200
260
146
187
262
257
200
225 216
192
211
274
-
50
100
150
200
250
-
5
10
15
20
2006 2007 2008 2009 2010 2011 2012
Dividends per share (cents) Recurring headline earnings per share (cents) Share price (cents) SOTP value per share (cents)
2013
Services and support
Upstream Midstream Downstream
MACRO ENVIRONMENT
Agribusiness focus
Food
InputsPrimary
productionProcessing
Secondary production
Distribution RetailMarketing and sales
Services and support
Beverages
Bio Fuels
Timber, Textiles, Leather, Rubber, Etc
MACRO ENVIRONMENT
Growth themes
2000 2050
MACRO ENVIRONMENT
African population growth
23
MACRO ENVIRONMENT
African demand
Source: FOA, World Bank, United Nations
• Inputs
• Mechanisation
MACRO ENVIRONMENT
Agri-productivity
25
• Irrigation
• Finance
• Technology
• Management
Share priceDPS / HEPS
PORTFOLIO REVIEW
R1,475m
• Influence ~ 30%
• Turnover = R18,6b
• Adjusted HE = R767m
• SA’s 2nd largest food company
• Listed on the JSE
• Earnings under pressure – high commodity cycle
• Significant capacity for recovery and growth
• Phil Roux started on 1 April 2013 (supported by strong team)
• Sideways for 12 months before resuming steady growth
Salient features:
0
1000
2000
3000
4000
5000
6000
7000
8000
0
100
200
300
400
500
600
08 09 10 11 12
Share price
(cents)
DPS / HEPS
(cents)
Recurring Adjusted HEPS Dividends Share price
• Listed on the JSE
• Four key divisions:
- Sasko
- Bokomo
- Ceres
- Agri
• Challenging environment
• Efficiency improvements
• Increasingly looking into Africa
PORTFOLIO REVIEW
R633m
Share price
• Influence = 71.2%
• Turnover = R5.2b
• Adjusted HE = R87m
• Leading fruit exporting and
marketing company
• Underlying performance encouraging
• Presents both challenges and opportunities
• Increased interest from 37.3% to 71.2% since YE
• Johan Dique and team implementing new strategy
Salient features:
0
50
100
150
200
250
300
0
5
10
15
20
25
30
35
08 09 10 11 12*
Share price
(cents)DPS / HEPS
(cents)
Recurring HEPS Dividends Share price
marketing company
• Three key divisions:
- Fruit marketing
- Fruit procurement
- Logistics
• Initial encouraging exposure to
China
• Solid contributions from
Mozambique
PORTFOLIO REVIEW
R343m
• Influence = 57%
• Turnover = R3.2b
• Adjusted HE = R103m
• Agri retail and related trade
company
• Underlying performance strong
• Zeder made voluntary offer to minorities
• Zeder increased interest to >35% since YE
• Sean Walsh and team driving strategy
Salient features:
0
1
2
3
4
5
6
7
8
9
10
0
20
40
60
80
100
120
140
160
08 09 10 11 12
Share price
(cents)
DPS / HEPS
(cents)
Adjusted HEPS Dividends paid Share price
company
• Three key divisions:
- Trade
- Grains
- Finance
• Growing in South Africa and
commencing African expansion
ZAAD Holdings R368m
• Influence = 92%
• Turnover = R610m
- KKSB = R320m
- Agricol = R290m
• Combined HE = R48m
• ZAAD created as holding company for seed investments
• Increased interest in Agricol from 25% to 92%
• Acquired 49% of Klein Karoo Saad Bemarking
• Antonie Jacobs and team driving clear growth strategy
Salient features:
PORTFOLIO REVIEW
Combined HE = R48m
- KKSB = R17m
- Agricol = R31m
• Producer, marketer and
distributor of a wide variety of
agricultural seeds
• Underlying performance strong
• Already doing business in Africa
and evaluating additional
opportunities-
2,000
4,000
6,000
8,000
10,000
12,000
-
200
400
600
800
1,000
1,200
08 09 10 11 12 13*
Share price
(cents)DPS / HEPS
(cents)
HEPS Dividends Share price
PORTFOLIO REVIEW
R276m
• Acquired 73.4% during 2012 / Partnership with Norfund
• Start-up company in rapid development phase
• Initial results within expectations
• Current focus to drive existing investments to scale
• Willem Meyer, Stuart Kearns, Phil Nicol
• Holding company for grain
related production operations in
Sub Saharan Africa
• Currently invested in two
farming operations in Zambia
• Increased irrigated hectares from
Salient features:
0
2,000
4,000
6,000
4169
2011
Mkushi 420
420
2012
Mkushi
1,572
Somawhe
2,597
4,169
2013
Mkushi
1,572
Somawhe
3,197
4,769
2014
Mkushi
1,572
Somawhe3,797
5,369
2015
Mkushi
1,572
Somawhe4,397
5,969
Irri
ga
ted
he
cta
res
• Willem Meyer, Stuart Kearns, Phil Nicol • Increased irrigated hectares from
420 to 4,169 in less than 18
months through development
and acquisitions
• Double cropping (wheat and
soya) for local demand
• Management teams/directors at portfolio companies
• Zeder directors and team
• PSG Group
Appreciation
CONCLUSION
• PSG Group
• Shareholders
• Stakeholders / Professional partners