Corpbanca Investor Conference

Transcription

1 Corpbanca Investor Conference December, 2014

2 I. ABOUT IANSA II. PLAN DULCE 2014 III. BUSINESS UNITS I. SUGAR & RELATED II. NON SUGAR BUSINESSES IV FINANCIAL RESULTS

3 Ownership structure OWNERSHIP STRUCTURE TO NOVEMBER 30, 2014 Owns 61% of Campos Chilenos December 4, December 30, Variation Share price (CLP) % Market Cap (USD MM) % Exchange rate % 3

4 Experienced management team José Luis Irarrazaval CEO 10 years in the Company and 20 in the sugar industry Paul De La Taille Human Resources 15 years in the Company Cristián Moran CFO 6 years in the Company José Luis Zabala Sugar Retail Manager 6 years in the Company and 19 in the food industry. Raimundo Díaz Industrial Sugar Manager 8 years in the Company and 21 in the food industry. Alvaro Prieto Operations & Agribusiness Manager 21 years in the Company Andrés Lizama Supply Chain Manager 16 years in the Company 4

5 Diversified source of revenues has helped us to manage international sugar price volatility IANSA FOOD ANIMAL NUTRITION AGRIBUSINESS Sugar and beet coproducts Pet food Financing Non caloric Sweeteners Cattle & Horse nutrition Supplies Concentrate Juice Production Tomato Paste I+D

6 Non sugar segments have increased their share in revenues and Ebitda 9M TO SEPT 2014 REVENUES NON SUGAR 29% 9M TO SEPT 2013 REVENUES NON SUGAR 18% As a result of the consolidation of Patagoniafresh in December 2013, the revenue base for 2014 results now considers Concentrate Juice results, increasing the Company's diversification. Sugar revenues (excluding co-products and non caloric sweeteners) decreased its share in consolidated revenues from 67% in 9M13 to 55% during 9M14. 6

7 Leading to stable flows despite sugar prices fluctuations PLAN DULCE 2014: STABLE CASH FLOW DESPITE INTERNATIONAL SUGAR PRICE VOLATILITY USD MM PLAN DULCE 2014 USD * 2012 Net income excludes a one time non operational gain of USD 10.2 million due to the dissolution of Inasa Overseas 7

8 I. ABOUT IANSA II. PLAN DULCE 2014 III. BUSINESS UNITS I. SUGAR & RELATED II. NON SUGAR BUSINESSES IV FINANCIAL RESULTS

9 Plan Dulce 2014 GOALS COURSES OF ACTION Strengthen our position in the Sugar & related businesses Increase productivity and efficiency in logistics, manufacturing and agribusiness. Diversify sugar supply sources Strengthen Iansa s financial position (current and long term) COMMERCIAL Brand strengthening Integrate Iansa s operations with ED&F Man Chile Redefinition of channel strategy OPERATIONAL Production & Logistics New refinery of raw sugar in Chillan Agricultural FINANCIAL Strengthen balance sheet Debt restructuring HHRR Cultural change Development and optimization of structures 9

10 Turnaround main drivers OPERATING BEET YIELDS DIVERSIFIED SUPPLY SOURCES Th ha. +30% Tons % 45% 13% 35% 25% 25% 27% 25% % 55% 52% 48% 50% E Yield Total Ha E National Production White Sugar Imports Raw sugar refining Beet yields have steadily increase during the last 5 years, due to the incorporation of state of the art technology in to the crop. The increase in beet yields has allowed the company to reduce the number of hectares contract, maintaining and even increasing its beet output. Since 2012 the Company has three different supply sources of sugar, due to the construction of a refining facility in Chillan. 10

11 Turnaround main drivers COMMERCIAL COMMERCIAL RESTRUCTURING NEW AND IMPROVED PRODUCT MIX Retail Industrial During 2010 Sugar Commercial unit is restructured and divided into two different business segments, focusing in different client needs. Retail: Supermarkets, wholesalers and distributors. Industrial: Bottlers, large and small manufacturers In 2008 Iansa enters the Non caloric sweeteners market, and in 2014 the Company finalized the construction of the Non Caloric plant in Chillan, internalizing the production of non caloric sweeteners with important cost reductions. Today around 5% of Sugar & Coproduct sales comes form innovation in sugar products. 11

12 Turnaround main drivers FINANCIAL INTEREST EXPENSE REDUCTION STABILIZATION OF FINANCIAL RATIOS -59% * LTM2014* Financial Expenses (MM of USD) LTM 2014 FND/Ebitda Since 2010 Iansa has reduced in 59% its financial expenses The increase in LTM2014 is mainly explained by the restructuring of our the Company's liabilities during the 1Q * y LTM2014* exclude the consolidation of Patagoniafresh Since 2010 the Company has stable financial ratios, thanks to increased and stable EBITDA results, coupled with a decrease in net financial debt. 12

13 I. ABOUT IANSA II. PLAN DULCE 2014 III. BUSINESS UNITS I. SUGAR & RELATED II. NON SUGAR BUSINESSES IV FINANCIAL RESULTS

14 Highly volatile & cyclical industry INDUSTRY SURPLUS/DEFICIT & INTERNATIONAL SUGAR PRICES MM tons End of European subsidies USD Surplus/deficit LND#5 14

15 Global industry: 2014/15 scenario 2014/15 WORLD DEFICIT BREAKDOWN MONTHLY STOCKS EVOLUTION The million tons sugar deficit expected for 2014/15 campaign is mainly driven by a growth of 3.5 million tons in consumption, coupled with a 6.5 million tons reduction in Brazilian and Asian sugar output. Nevertheless actual stock levels will impact expected deficit, generating a 2.7 million tons surplus for 2014/15 Due to the stock effect price consensus on prices is that they will still be pressured in Source: LMC sugar bulletin & Kingsman annual sugar conference 15

16 Chilean sugar industry SWEETENERS CONSUMPTION IN CHILE CALORIC SWEETNERS CONSUMPTION CARG: +2.2% GDP PER CAPITA CARG: +8.5% Main sugar players: SUCDEN AGROCOMMERCE 16

17 Chilean sugar industry: Market regulation SUGAR PRICE BAND CAME TO AN END ON NOVEMBER Spot LND#5 Piso Techo Since 2006, when international sugar production subsidies were eliminated, international prices have remained above the celling of the band; allowing sugar imports to Chile tax free. 17

18 Over 60 years in Chilean agriculture achieving world record agricultural yields IANSAS AVERAGE BEET YIELD EVOLUTION Three times world leaders E Average 20,000 has. with sugar beet per year - 10,000 of them with modern irrigation techniques. Long term relationship with farmers. Technological crop innovation, improved seed selection, highly experienced agricultural team. 18

19 Supplying market needs with three different sources A flexible sugar supply base reduces volatility and allows us to take advantage of the market opportunities. 49% 45% 13% 35% 25% 25% 27% 25% 51% 55% 52% 48% 50% E National Production White Sugar Imports Raw sugar refining Sugar Production from Beet Refined Sugar from raw sugar imports Refined Sugar imports 19

20 I. ABOUT IANSA II. PLAN DULCE 2014 III. BUSINESS UNITS I. SUGAR & RELATED II. NON SUGAR BUSINESSES IV FINANCIAL RESULTS

21 Non caloric sweeteners 30% of the sweeteners consumption in Chile comes from non caloric sweeteners New state of the art technology production plant in Chillan Start-up of operations: 4Q13 Participation on the healthiest and growing segments Sucralose & Stevia 17.4% Market Share in the Non Caloric Sweeteners market (Oct. 2014), 24% MS in Sucralose 16.2% MS in Stevia Sweeteners consumption evolution (value) MM CLP +45% +16% +10% Economic Sucralose Stevia 100% Stevia 21

22 Animal Nutrition Milk production growth (Thousand of Liters) Over 25 years of experience in the Animal Nutrition market. Market leader with 57% market share bovine feed and 35% market share in horse feed Producción Recepción Volume sold (tons) +45% +27% -8% High nutritional value products. 3 commercial offices & highly skilled commercial team that provide our costumers with support in the field. Modern laboratory for continuous R&D and formula innovation. Value added for our sugar beet coproducts. Product portfolio & customized solutions to satisfy our costumer requirements. Cutting edge technology for 180,000 ton per year plant capacity. 22

23 Pet food business Industry growth in Chile Cutting-edge technology in new 80,000 ton per year plant Start-up of operations: 1H 2014 Presence in the leading retailers & distributors in Chile 6.6% Market Share in volume in Chile (Oct. 2014) just with our brands. More than 10 years of experience in pet food production & selling Growth and product mix change (volumen) +3% +6% +3% Brand portfolio covering the different market segments Continuous Innovation in Packaging & Product Mix +75% +58% +42% 23

24 Patagoniafresh: Concentrate Juice Patagoniafresh: 2013 Revenues by point of Sale Fully consolidated in December 2013 Main exporter of non citric juices in Latin America. During 2013 important efficiency milestones were achieved, driving its EBITDA to USD 8.2 million, a 82% growth APPLE GRAPE OTHERS PRODUCTS MAIN MARKETS USA, Canada, Mexico and Japan USA, South Korea and Canada USA, Canada, Germany and Australia FACILITIES Molina San Fernando & Ovalle San Fernando 24

25 Icatom: Tomato Paste Tomato yield evolution (ton/ha) Volume sold Evolution (tons) Icatom: 2013 historic record in tomato yield achieving 137 MT/ha, on average. More than 17 thousand tons of tomato paste sold on 2013, representing a 54% growth. 100% of cultivated ha. of Icatom are equipped with modern irrigation systems, ensuring the quality of its products. 25

26 I. ABOUT IANSA II. PLAN DULCE 2014 III. BUSINESS UNITS I. SUGAR & RELATED II. NON SUGAR BUSINESSES IV FINANCIAL RESULTS

27 2014 figures (Jan Sep 2014) USD MM 9 Months to Months to 2013 % Var. 9 Months to 2014 (Ex -PF) % Var. REVENUES % % GROSS PROFIL % % GROSS MARGIN 24.0% 26.0% -2.0 pp 24.0% -2.0 pp OPERATING RESULT % % OPERATING MARGIN 4.0% 5.7% -1.6 pp 3.7% -2.0 pp EBITDA % % EBITDA MARGIN 6.9% 8.0% -1.1 pp 6.3% -1.7 pp NET INCOME % % Revenues in the first 9 months of 2014 increased 10.7%, as a result of Patagoniafresh consolidation in 4Q13. Excluding the effect of the consolidation of Patagoniafresh, revenues decreased 1.3% in the period, reaching USD million. This decrease is explained due to lower revenues in the sugar and coproducts segment, as a consequence of the 9.4% decrease in international sugar prices, which has been partially offset by higher revenues in the rest of the Company's businesses. EBITDA decreases 4.3% in the period as a result of lower revenues in the sugar and coproduct segment, coupled with higher costs of goods sold and operating expenses in the agribusiness segment, as well as in the animal nutrition and pet food segment. 27

28 Reduction in Sugar EBITDA is compensated by increases in Non sugar businesses EBITDA EFFECTS (USD) - $13.6 +$5.8 +$8.3 $32.2 -$1.9 $30.8 7,6 9 Months to Sept 2013 Sugar Agribusiness Other Businesses* Patagoniafresh 9Months to Sept 2014 Consolidated EBITDA in the period reached USD 30.8 million, a decrease of USD 1.4 millions as compared to the first 9 months of The decrease is mainly explained by a decrease in the sugar business unit (excluding coproducts and non caloric sweeteners) due to lower international sugar prices, and higher productive costs. The decrease was partially compensated by increases in the EBITDA of Non sugar businesses coupled with the consolidation of Patagoniafresh in 4Q13. 28

29 Sugar cycle Abr May Jun Jul Ago Sept Oct Nov Dic Ene Feb Mar Beet price definition Hectares contracts Crop sowing Beet Reception Sugar beet production Raw sugar refining Sugar beet future contracts White Premium future contracts Abr May Jun Jul Ago Sept Oct Nov Dic Ene Feb Mar 29

30 Hedging backround Average Future Prices 2010 US$571/TM Average Future Prices 2011 US$660/TM Average Future Prices 2012 US$577/TM Average Future Prices 2013 US$489/TM Precio Spot Prince Spot Contratos Future contracts Futuros Hedges 2011 US$472/TM Vol: 70% national production Hedges 2012 US$582/TM Vol: 96% national production Hedges 2013 US$572/TM Vol: 71% national production Hedges 2014 US$504/TM Vol: 57% national production

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