PT MALINDO FEEDMILL TBK...World Bank, Kompas daily, LEK Consulting, McKinsey, OECD, Company Protein...
Transcript of PT MALINDO FEEDMILL TBK...World Bank, Kompas daily, LEK Consulting, McKinsey, OECD, Company Protein...
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3Q 2019 RESULT PRESENTATION
PT MALINDO FEEDMILL TBK
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COMPANY OVERVIEW
3Q/2019 HIGHLIGHTS
INVESTMENT HIGHLIGHTS
Nov 7th, 2019
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COMPANY OVERVIEW
UPSTREAM MIDSTREAM DOWNSTREAM
FEED BREEDINGCOMMERCIAL
FARMINGFOOD
PROCESSING
Vertically integrated business
Nov 7th, 2019
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
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KEY INVESTMENT HIGHLIGHTS
Nov 7th, 2019
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Chicken consumption in Indonesia keeps growing and forecasted to be even stronger in 2023
Indonesia’s middle class is growing, adding 80million people in the middle class by 2020
Chicken is the most affordable animal protein after eggs Indonesia has one of the lowest chicken consumption in SE Asia
Source: Badan Pusat Statistik (2018) and Indonesia Finance Ministry (2019) , Indonesia State Budget, FAOStats, BPS, IMF, USDA, World Bank, Kompas daily, LEK Consulting, McKinsey, OECD, Company
Protein sourcePrice/kg
(IDR)Protein content
Protein Price/g
(IDR)
Egg 23,500 12.5% 188
Chicken (broiler) 35,000 18.5% 189
Fresh milk 25,000 3.5% 714
Beef 190,000 20.0% 950
Fish 167,500 17.5% 957
47.0 46.0
16.0
9.0 10.5 13.6
2.0
38.8
10.6
5.8 2.5 3.6
1.5 0.8
Brunei Malaysia Thailand Philipines INDONESIA Vietnam Cambodia
Chicken consumption percapita (kg/ year)
Income per capita (USD1,000)
Investment highlight #1: Attractive, fast growing industry
217,500 242,500
264,000 265,000 271,000
15,225
45,000 58,080 60,000
80,000
2002 2010 2017 2018 2020
Indonesia total population Middle class population
('000 people)
2,141
2,382
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Historical
Trajectory
(‘000 tons)
Nov 7th, 2019
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Indonesia feed production capacity share (2018) Indonesia DOC production capacity share (2018)
Source: Company (2018)
35%
25%
8%
4%
8%
20%CPIN
JPFA
MAIN
NEW HOPE
CJ
Others
38%
25%
7%
5%
25% CPIN
JPFA
MAIN
NEW HOPE
Others
Investment highlight #2: Top 3 integrated player and well-positioned in the market supported by strategic locations
Legends Division2019 Annual
CapacityLocations
Feedmill 1,500,000 MT Cakung, Cikande, Gresik, Semarang, Makassar, Lampung
GPS Breeding
3.2 mn DOCs Majalengka
PS Breeding 258 mn DOCsMedan, Lampung, Subang, Cikaum, Purwakarta, Wonosari, Probolinggo, Lumajang, Pontianak, Banjarmasin, Makassar, Pekanbaru, Palembang, Rembang,
Broiler 77.5 mn kg Medan, Subang, Bogor
Food Processing
9,000 MT Cikarang
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Broiler capacity (MT)Feed capacity (MT)
7957
Capex (IDR bn)
64 26223
CAGR23,3%
116
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
• Maximize the production utilization isexpected to improve EBIT margin througheconomies of scale (target utilization inFY2019 : 75%-80% of optimal capacity)
• Expanding capacity to 77,500 tons inFY2019 to support the growth inprocessed food & chicken consumption
DOC capacity (Mn birds)
167 77244
CAGR2,3%
• Expanding production capacity with atarget of 270 Mio chicks in FY2019
• Malindo expects to add 7% - 10%production volume per annum to supportprojected market recovery.
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Consumer Foods capacity (MT)
Capex (IDR bn)
052
Investment highlight #4: Upside from Processed food (CBP) segment
Nov 7th, 2019
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Investment highlight #4: Upside from Processed food (CBP) segment
DISTRIBUTION MAPCUSTOMER AND OUTLET GROWTH
Reputation as high quality producer, solid track record with diverse customer base
Nov 7th, 2019
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Investment highlight #5: Highly experienced management with strong governance
Lau Chia Nguang Tan Lai Kai Yongkie Handaya Brian M. O ’Connor Koh Bock Swi(Raymond Koh)President Commissioner Commissioner* Independent Commissioner* Independent Commissioner*
Independent Commissioner*
Year of Poultry experience:
More than 40 years
Year of Manufactureexperience:
More than 25 years
Year of Finance experience:
More than 20 years
Year of Finance experience:
More than 40 years
Year of Poultry experience:
More than 25 years
*): Professional
Tan Sri Lau Tuang Nguang
Mazlan Bin A. Talib Rewin Hanrahan Lau Joo Hwa Lau Joo Keat Rudy Hartono Husin Dato’ Seri AbdulAzim Bin Mohd ZabidiPresident Director
Director* Director* Director Director Director*
Director*
Year of Poultry experience:
More than 30 years
Year of Agriculture experience:
More than 30 years
Year of Poultry experience:
More than 25 years
Year of Poultry experience:
More than 15 years
Year of Poultry experience:
More than 15 years
Year of Finance experience:
More than 20 years
Year of Finance experience:
More than 20 years
Nov 7th, 2019
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Investment highlight #5: Highly experienced management with strong governance
*): Professional
Aldrin RungkatFeedmill Director*
Tan Sri Lau Tuang Nguang
President Director
Lau Joo HwaOperation Director
Lau Joo KeatBreeder Farming Director
Rudy Hartono HusinFinance Director*
Rewin HanrahanMarketing Director*
Hilda WibowoHR Director*
Nov 7th, 2019
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Investment highlight #6: Productive age employees
40%
37%
23%
Company's employee category by age
20 - 29 years 30 - 39 years > 40 years
Nov 7th, 2019
DOC & Broiler Average Selling PriceGovernment initiatives ensuring stable DOC
& chicken prices and supply-demand dynamics
Q3/2019
Consumer demand projected to improve with strong support by macro conditions
GDP growth: 2020 5.3 – 5.6% (2019 c. 5.3%)
Feed margins to benefit from volume growth, particularly expanding to swine
feed and duck feed
Consumer food volume continues increasing by boosting the sales through social media
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3Q/2019 HIGHLIGHTS
Nov 7th, 2019
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EBITDA
REVENUE
FINANCIAL PERFORMANCE
NET PROFIT
EBIT MARGIN
3Q (Y-Y) 9M (Y-Y)1.8% 17.7%
3Q (Y-Y)9M (Y-Y)
-19% -3%
Nov 7th, 2019
67,495,896 49,460,570
225,595,279 195,396,711
Q3/2018 Q3/2019 9M18 9M19
3Q (Y-Y) 9M (Y-Y)-26.7% -13.4%
1,765,873,460 1,797,342,247
4,838,505,762
5,669,502,891
Q3/2018 Q3/2019 9M18 9M19
199,776,891 160,845,873
565,229,612 546,471,631
11.3%
8.9%
11.7%
9.6%
8.0%
9.0%
10.0%
11.0%
12.0%
0
100,000,000
200,000,000
300,000,000
400,000,000
500,000,000
600,000,000
Q3/2018 Q3/2019 9M18 9M19
EBITDA EBITDA (%)
4.3%
5.7%
6.7%6.1%
Q3/2018 Q3/2019 9M18 9M19
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CAPEX
TOTAL ASSETS
FINANCIAL PERFORMANCE
NET DEBT/ EQUITY
TOTAL INTEREST BEARING DEBT
3Q (Y-Y) 10%
3Q (Y-Y) 11%
3Q (Y-Y) 15%
Nov 7th, 2019
4,349,412,672
4,765,416,226
Q3/2018 Q3/2019
78,273,675
122,433,107
238,683,114 267,234,810
Q3/2018 Q3/2019 9M18 9M19
3Q (Y-Y) 56% 9M (Y-Y) 12%
1,820,187,614
2,012,919,339
Q3/2018 Q3/2019
0.82
0.94
Q3/2018 Q3/2019
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SALES3Q (Y-Y)
10 %
SEGMENT PERFORMANCE
FEEDMILL
26 %SALES
9M (Y-Y)
Nov 7th, 2019
1,033 1,139
2,819
3,561
26.2 180 163
414 2.5%
15.8%
5.8%
11.6%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
-
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
Q3/2018 Q3/2019 9M18 9M19
16
-24%
BREEDER
SEGMENT PERFORMANCE
SALES3Q (Y-Y)
7%SALES
9M (Y-Y)
Nov 7th, 2019
408
311
1,016
1,091
119.6
(46.0)
203.1
49.2
29.3%
-14.8%
20.0%
4.5%
-20.0%
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
(200)
-
200
400
600
800
1,000
1,200
Q3/2018 Q3/2019 9M18 9M19
FOODBROILER
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SEGMENT PERFORMANCE
SALES3Q (Y-Y)
3 % 0.0005 %SALES9M (Y-Y)
SALES3Q (Y-Y)
41 % 14 %SALES9M (Y-Y)
29
41
99
113
(10.6) (10.3)
(35.8)(28.4)
-36.5%
-25.2%
-36.0%
-25.1%
-40.0%
-35.0%
-30.0%
-25.0%
-20.0%
-15.0%
-10.0%
-5.0%
0.0%
(60)
(40)
(20)
-
20
40
60
80
100
120
140
Q3/2018 Q3/2019 9M18 9M19
Nov 7th, 2019
296 306
905 905
1.2
(16.1)
55.3
(52.9)
0.4%
-5.3%
6.1%
-5.8%
-8.0%
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
(200)
-
200
400
600
800
1,000
Q3/2018 Q3/2019 9M18 9M19
Nov 7th, 2019
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