Agenda. Peruvian Economy. Commerce data. The Peruvian Agroindustry. Main Products and markets Social Responsability Camposol in the Peruvian Industry

Transcription

1 Agenda Peruvian Economy Commerce data The Peruvian Agroindustry Main Products and markets Social Responsability Camposol in the Peruvian Industry Conclusions

2 Peruvian Economy! GDP growth over 5% annually in the last 10 years! Expected GDP 2012: 6.3%! Highest GDP growth in the region: " 6.2% in 2013 " 6.3% in 2014! Inflation 2012: 2.65% annual! Peruvian Central Bank Forecast (2013): Inflation : 2% annual! Main Export Products : gold, copper, fishmeal, coffee, cocoa, fresh fruits & vegetables.! 20 signed Free Trade Agreements, 16 are already in force (Multiparty Trade Agreement).! Agriculture GDP increased 5.1% in Estimates for % and 4.3% in 2014

3 Peru is one of the most dynamic economies in the world GDP constant prices * China Peru India Chile Colombia Russia Mexico USA Brazil % change Canada Germany Japan Source: IFM, World Economic Outlook Database, Oct * EsKmated figures 3

4 Peru s macroeconomic performance over the last decade has been exceptional LATAM GDP Growth and inflation ( ) Total Investment LA (% GDP) average % change Peru Chile Mexico Colombia Brazil ArgenKna Urugua y GDP InflaKon Source: Central Bank of reserve of Peru, CRP, MEF, IMF WEO Oct LA6 : six LaKn American countries that have adopted a formal inflakon targekng framework and have relakvely more developed domeskc capital markets. 4

5 Posi/ve Outlook for Peruvian exports in the long term (U.S. $ million) Over the period we doubled our exports Between 2000 and 2006, we tripled our exports 28, years for doubling exports Towards 2016 Peru will double its exports, triplicate non- tradi/onal exports, and double the number of exporters Source: SUNAT

6 The Peruvian export success creates a dynamic effect on the rest of the national economy (2013) U.S.$ Exports per capita U.S. $ to Products exported to Exporters US$ M Non-Traditional Exports Source: SUNAT 6

7 Working to become a globalized economy, with preferential access to the world s largest markets + 55 world economies Agreements signed under Agreements negotiation in force + 95% of Peruvian exports with trade preferences millions of consumers 7

8 Agroindustry Overview Highlights Peru non traditional agricultural exports # Agricultural exports have shown a strong growth trend during the past decade. # Non traditional agricultural exports have constantly represented about 70% of agricultural exports. (FOB US$ Billion) CAGR: 16% # Occupation in agriculture/fishing/mining activities has constantly accounted for more than 25% of the Peruvian labor force during the past decade Irrigation projects - developing agricultural zones Peru agricultural exports Tumbes: Puyango 18,500 Has (extension) Piura: Alto Piura 19,00 Has (extension) 31,000 Has (improvement) Arequipa: Majes Siguas II 38,500 Has (extension) (Hydro energetic project) Lambayeque: Olmos 38,000 Has (extension) La Libertad: Chavimochic III 53,000 Has (extension) 48,000 Has (improvement) Ancash: Chinecas 33,053 Has (extension) 10,500 Has (improvement) (FOB US$ Billion) CAGR: 18% Source: SUNAT, PROINVERSION. 8

9 Traditional and modern agriculture! Created 1.4 million new direct jobs million indirect jobs in total agriculture in last decade.! Modern agriculture grew at 6.65% yearly average as compared to 2.2 of traditional agriculture.! Harvested areas of main five products (asparagus, grapes, avocados, mango, citrus) increased 70%. Expected 203,000 hectares more in next 8 years.! Cumulated investments reached US$ 1.3 billion last decade.

10 Traditional and modern agriculture! Modern agriculture develop important clusters as in Ica (asparagus, grapes, avocados), La Libertad (asparagus, peppers) and Piura (mangoes, bananas).! Poverty, including extreme poverty decreased 15%, with better income and living standards.! New jobs for women workers, increased 7 times in last 12 years. Agriculture men s new job 4 folded.

11 Ranking of Peruvian Products Fresh Asparagus Organic Banana Fresh Mangoes Avocados Table grapes Agricultural Industry: global competitiveness in fine vegetables (asparagus and artichoke) and fresh fruits (table grapes, mango, avocado, banana, citrus) in the EU and USA. " Fresh fruits and vegetables exports represented around 45% of the Peru s non-traditional agricultural exports in the period " Privileged geographic location & Off-season production " 28 climate zones out of the 32 that are registered in the planet. " Extended harvesting seasons. " Available quality labor force

12 Foreign Trade! Non-traditional Agro Exports: Average Annual Growth : 12.3%.! 2012 " Agri Exports will be over USD 3,000 million " Growth: 12/11: 7% " 35% sent to Europe, 29% USA, 28% South America and 7% to Asia. " Sales to Asia grew nearly 25% and Oceania 14.1%. " Exports to Thailand, South Korea and Norway grew nearly 200%.! Exports to Asia tripled in just five years.

13 Main Products! Exports have increased as more countries demand the fruit: i.e. China, Korea, Thailand, Russia! Grapes and mandarins increased their participation in the F&V total.! Import permit for Hass avocado in USA, tangelos and mandarins in China, grapes in Korea. Soon asparagus in China * Source: SUNAT *Jan-nov Source: SUNAT

14 Main Markets! F&V exports: 45% sent to Europe, 36% to USA, 11% to Asia and 5% to South America. In 2012, Asia was the more dynamic region: China 40%, Thailand 237% and South Korean 187%.! F&V exports is the most dynamic in the Non-traditional agricultural sector.! 56% of fresh F&V exported to the USA and the Netherlands (Western Europe, France, Nordics, etc.)! Rate Quality/prices explains boom of F&V exports * Source: SUNAT *Jan-nov

15 Main Products and Markets! Grapes: exports have increased as more Asian countries demand grows: i.e. Thailand and South Korea.! Exports to Russia 6 folded in last 4 years.! 2008: 43 markets, 53 companies.! 2011: 55 markets, 116 companies! Norway is a new market since 2011 and South Korea since 2010.! Asparagus: consolidated in some markets! 2008: 44 markets, 113 companies! 2011: 45 markets, 106 companies Grapes Asparagus * SUNAT - Preliminary

16 Main Products and Markets! Mangoes sent to Germany increased by 12x in the last four years (in volume). " 2008: 18 markets, 106 companies " markets, 173 companies " Japan is a new and important market since 2010; Greece and Russia since 2012! Hass Avocado exports to USA initiated supplies in " 2008: 12 markets, 30 companies " 2011: 27 markets, 96 companies " Russia started to buy avocados from Peru since 2010: USD 500,000 (2012). Mangoes Avocados * SUNAT - Preliminary

17 Main Products and Markets! Citrus exports have increased in recent years, mainly mandarins. " China is a new market for mandarins since " 2008: 24 markets, 36 companies " 2011: 36 markets, 50 companies! Demand for bananas have increased in the Netherlands/W.Europe and the U.S " 2008: 9 markets, 14 companies " 2011: 14 markets, 28 companies. " South Korean is a new and growing market since 2011: USD 2 mill. (2012). Citrus Bananas * SUNAT - Preliminary

18 Main Products and Markets! Onion exports dubbled in the last 5 years.! USA and Colombia are the most relevant destinations " 2008: 17 markets, 86 companies " 2011: 21 markets, 102 companies Onios * SUNAT - Preliminary

19 New products on their way Cajamarca Huánuco Junín La Libertad Ayacucho Ancash Prickly pear Lima Lucuma Cuzco Ica Pomegranat e Cherimoya Granadil e Arequipa Blueberries + Golden berries

20 Social Development - Social Responsibility $ During , poverty (incl. extreme poverty) in the agricultural sector was reduced in 15% $ Income in agricultural sector increased 40.6% in the same period $ More opportunities for women $ Modern use of the irrigation system in order to preserve the resource $ Deserts has changed into land of crops $ Implementation of GLOBALGAP

21 Social Development - Social Responsibility $ Appropriate work environments $ Training for providers $ Many companies provide food, transportation, to their workers. Health insurance mandatory by Law.

22 Strategic location: yields, prices and agricultural risks Highlights # Climatic factors in Peru provide significantly better product yields Major asparagus producers 2010 yields (metric tons per hectare) # Natural greenhouse conditions and stable temperatures throughout the year Humboldt current Proximity to the tropical equatorial regions Little weather fluctuations # Sandy soils with drip irrigation systems along coastal desert plains Major avocado producers 2010 yields (metric tons per hectare) # Year round supply of asparagus # No extreme climate All major agricultural risks (floods, frost, droughts) mitigated by the stable weather conditions Peru s climate allows Camposol to produce more efficiently all-year round, take advantage of production windows not available to competitors, and achieve higher than average yields Source: FAOStat, ACM. 22

23 Strategic location: yields, prices and agricultural risks (cont d) Major asparagus producers seasonality Main producers of avocado and grapes MT per month Equator 5 0 Legend USA # Mexico Emerging producing Historically producing Peru Year-round production cycle Unique production window; the only major exporting country during the July-February period # Grapes and avocado have been traditionally grown and consumed in the northern hemisphere # As population expanded, regions in the southern hemisphere became the natural suppliers of these fruits Efficient asparagus production compared to competing countries # Similar climatic benefits and unique export windows also present in avocado production # Peruvian products expected to gain enhanced access to international markets through free trade agreements Consumers in the northern hemisphere were subject to natural seasonality and harvest of these fruits, lacking adequate supply during a significant portion of the year # Countries such as Peru now take a lead role in supplying the northern hemisphere by taking advantage of a different seasonality, effectively creating year-round supply, and accessing the market when supply from other regions is seasonally low Peru s climate allows Camposol to produce more efficiently all-year round, take advantage of production windows not available to competitors, and achieve higher than average yields Source: FAOStat, ACM, company data. 23

24 Camposol at a glance # Largest asparagus exporter in the world. # Largest producer of Hass avocadoes. # Soon to be largest producer of Blueberries in Southern Hemisphere # Positioned in the healthy food segments: fruits and vegetables. # Large bank of lands: 26,700 Has (1) out of which approximately 8,200 (2) hectares have been planted. Main operations Piura Mangoes, Peppers, Grapes Tumbes Shrimps Chao Avocadoes, White/ Green asparagus Lima # Fields managed using advanced agricultural practices; processing plants fitted with state of the art equipment. # Employs on average 13,000 workers. # Strong Corporate Governance: Board members: 4 of 6 members are independent. (1) 1 hectare = 2.47 acres (2) Gross planted. Although 6,300 Has have been planted, road, facilities, intangible areas, among others, also constitute part of the gross planted Has. On average, planted fields itself represent between 75% - 80% of each field. 24

25 Camposol s history 1997 # Camposol is founded after the purchase of 3,075 hectares of arable land 2001 # Begins production and exports of piquillo pepper 2006 # Company exceeds US$100 million in annual revenues 2008 # Camposol is listed on the Oslo Stock Exchange # Implementation of SAP operating systems # 1,170 hectares of white asparagus planted # 100 hectares of grapes planted 2010 # Expansion of shrimp business through purchase of local players # 351 hectares of grape planted (30 hectares finished in 2011) 2012 # Successful issuance of a USD 125 million 9.875% senior unsecured notes due # Small scale production of asparagus begins 2003 # Mango fields entered production 2007 # D&C Group purchases Camposol 2009 # 1,662 hectares of avocadoes planted 2011 # Peru receives clearance to export avocadoes to the US 2013 # Engagement Letter signed with Credit Suisse # D&C takeover bid for all outstanding CSOL shares. # Squeeze out approved after D&C bought 90.4% of CSOL outstanding shares # CSOL delisted from Oslo Bors. More than US$100 million invested since D&C acquired Camposol. Source: Company data. 25

26 Camposol s production facilities # State of the art produce processing and packaging plant in Chao/ Viru, shrimp farms and biotechnology lab in Tumbes Camposol selected certifications # 100 % traceability of crop harvested, essential for achieving the maximum food safety certifications # Unique competitive advantage given Camposol s complete and integrated control over the entire production chain Complete flexibility in shifting processing mix (fresh, frozen or preserved) as well as volumes produced # Additional value-added through processing allows the Company to maintain higher margins and differentiate its products # Opportunity for cost efficiencies and economies of scale at every step of the value chain Company is in the process of automating its production processes, reducing labor costs. Camposol s vertical integration allows it to maintain 100% product traceability, significant output capacity and cost savings vis-à-vis its competitors. 26

27 Key company strengths Strong fundamentals, unique competitive advantages, solid strategy, management capacity and strong corporate governance place Camposol in a unique position in its competitive landscape. 1) Strategic location 6) Land Stock 2) Vertically integrated throughout the entire value chain 5) Strong growth without substantial additional CAPEX 3) Diversified portfolio and leading position in its main products 4) Global presence and world-class customers 27

28 Vertically Integrated, with a presence throughout the entire value chain Camposol s value chain Raw materials Processing Products Distribution Own fields and third parties Streamlined processing Focus on niche and high margin fruits Global customer base " Full control over production, including quality and logistics. " Total product traceability. " Higher degree of control over product quality and consistency. " Only Peruvian company with fully integrated processing process (preserved, fresh and frozen). " All major quality and process certifications (HACCP, Global Gap, TNC, among others). " Significant investments made in optimizing plant efficiency and reducing dependency on skilled labor. " Producing 5 of the most important Peruvian nontraditional exports, in three different presentations. " Long-term relationships with leading retail chains in both Europe and the US (private labels). " Offices in Europe and US. Camposol s vertical integration allows the Company to manage and benefit from each stage in the entire production and commercialization cycle. 28

29 Conclusions # Peru is a strategic partner as supplier in Southern Hemisphere # India and Peru have to look for oportunities # Private and public sector needs to take their rols # Free trade agreements are a tool # Fresh Produce industry in Peru is ready for new challenges and new markets 29