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UAC OF NIGERIA PLC H1 2013 Results Presentation UAC OF NIGERIA PLC.

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Presentation on theme: "UAC OF NIGERIA PLC H1 2013 Results Presentation UAC OF NIGERIA PLC."— Presentation transcript:

1 UAC OF NIGERIA PLC H Results Presentation UAC OF NIGERIA PLC

2 2 Important Notice

3 Contents outlook 4 Update on strategic thrusts Financial performance review Overview of the business in H Larry Ettah GMD/CEO Abdul Bello CFO Joe Dada ED Corp. Services Larry Ettah GMD/CEO

4 Contents outlook 4 Update on strategic thrusts Financial performance review Overview of the business in H Larry Ettah GMD/CEO Abdul Bello CFO Joe Dada ED Corp. Services Larry Ettah GMD/CEO

5 5 VISION To be number one in our chosen markets, providing exceptional value to our customers VISION To be number one in our chosen markets, providing exceptional value to our customers MISSION To grow our top-line at twice the rate of GDP growth in Nigeria at a blended EBIT profitability of 15% MISSION To grow our top-line at twice the rate of GDP growth in Nigeria at a blended EBIT profitability of 15% OUR VALUES 1.Our Customers are our Focus 2.We act with Respect for the Individual 3.We act with Integrity in everything we do 4.Team spirit will give us good success 5.Innovation for business sustenance and value creation 6.We are Open and Communicate with our people OUR VALUES 1.Our Customers are our Focus 2.We act with Respect for the Individual 3.We act with Integrity in everything we do 4.Team spirit will give us good success 5.Innovation for business sustenance and value creation 6.We are Open and Communicate with our people DESIRED OUTCOME Adding value to the lives of our stakeholders

6 Business Review – UACN Plc Food & BeverageReal EstatePaintsLogisticsOthers Grand Cereals Ltd (64.9%) Grand Oil, Vital Feeds, Grand Maize Flour, Grand Maize Grits, Rich Fill UPDC Plc (46%) Property Development Facility Management Property Sales Property Lease CAP Plc (50.1%) Dulux Paints Caplux Paints MDS Logistics Plc (51%) Warehousing Haulage Redistribution UNICO CPFA Ltd (87%) Closed Pension Fund Administrator UAC Foods Ltd (51%) Gala, Funtime Cake, Funtime Coconut Chips, Snaps Puffed Maize, Delite Fruit Juice, SWAN Water Portland Paints & Products Nigeria Plc (51%) (Acquired June ) Sandtex Decorative Paints Hempel Marine Paints UAC Registrars Ltd (100%) (Divesting in August 2013) UAC Restaurants Ltd (100%) (168 Outlets) Mr Bigg’s GM Nig. Ltd (60%) (Winding Down) Livestock Feeds Plc (51%) Animal Feeds Warm Spring Waters Nig. Ltd (76%) Gossy Water 6 UAC has defined its holding company structure as a model consisting of a Corporate Centre overseeing a portfolio of interests across 4 key verticals

7 H Highlights UAC acquires controlling stake in Livestock Feeds UAC acquires controlling stake in Portland Paints MDS completes partnership arrangement with Imperial Logistics UAC Restaurants returns to profitability UPDC completes REIT; lists on the NSE 7

8 Operations Review  Turnover up 8%  Installation of new blow mould equipment at SWAN Factory  Installation of two additional production lines for Gala  Completion of facility upgrade in Ojota & Oregun  Roll out of Funtime Cake with 15 days shelf life  Working to regain days lost to installations and improve off-take  Security challenges in the North have impacted on sales execution.  Turnover up 27%  North East market inaccessible (Security Challenges)  Elevated local grain prices impacting margins; procurement savings being pursued (via Offshore sourcing)  Operational review and restructuring on-going  New Plant installation on- going  Turnover down 27% (Q had corporate stores now franchised)  Launched N600 Naija Meal  Franchising outstation central kitchens  Due diligence by prospective investors UAC FOODS LTD GRAND CEREALS LTD UAC RESTAURANTS LTD

9 Operations Review  Turnover up 18%  Grandville Estate (GRA – Ikeja) & Metro Gardens (Lekki) commissioned  Construction work on Festival Mall, Festac commenced  UPDC REIT listed on the Nigerian Stock Exchange  Sales mix impacting profit favourably  Turnover up 38%  Commenced business with four new clients  Capacity upgrade of Abuja Pharma warehouse facility  Imperial Logistics acquired equity stake (49%)  Joint operational review with Imperial on-going  Turnover up 14%  Opened four new Dulux Colour Shops UPDC PLC MDS LOGISTICS PLC CAP PLC

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11 Contents outlook 4 Update on strategic thrusts Financial performance review Overview of the business in H Larry Ettah GMD/CEO Abdul Bello CFO Joe Dada ED Corp. Services Larry Ettah GMD/CEO

12 12 Turnover up 24%; key drivers include Grand Cereals (up 26%), UPDC (up 18%) and MDS Logistics (up 38%) Other Income is boosted by UPDC profit on sale of investment property Finance Costs up 10% primarily due to increase in UPDC’s finance costs (up 29%) Raw material price increases impacting margins of Grand Cereals; we expect improvement at Q PBT up 51%; key contributors include UPDC (up 129%), MDS (up 37%) and UAC Restaurants (N99m vs. loss of N212m) Review of Financial Performance

13 (N’Billion) 13

14 14 Summary of Financial Performance (YoY)

15 YOY Margins Analysis EBIT MarginGross Margin 15 Gross Margin down due to input cost pressures in Grand Cereals. EBIT Margin improves by 2%

16 Capital Structure Interest Cover (x)Debt to Equity (x) 16 Debt to Equity Ratio up due to increased debt in Grand Cereals. Interest Cover improves as a result of higher EBIT.

17 Improving Returns… ROAROE 17 ROE and ROA grew on the back of a robust performance

18 Summary of Financial Position 18

19 Review of Financial Position (N’Billion) 19

20 Total Equity (N’Billion)Total Debt (N’Billion) 20 Borrowings increased on account of increased leverage in Grand Cereals as well as consolidation of Livestock Feeds. Total Equity up marginally. Capital Structure

21 Summary of Cash flows 21

22 Segment Analysis - Turnover H1 2012H The Food & Beverage, Real Estate, Logistics and Paints segments constituted approximately 100% of revenues in H and H1 2012

23 Segment Analysis – PBT H1 2012H The Food & Beverage, Real Estate, Paints and Logistics segments contributed 97% of Group PBT for H Impressive performances in Real Estate and Logistics changes contribution dynamics

24 Performance of Key Subsidiaries UPDC (N’Billion) Grand Cereals (N’Billion)UAC Foods (N’Billion) 24 CAP (N’Billion)

25 UAC Restaurants (N’Million) 25 MDS Logistics (N’Million) Livestock Feeds (N’Million) UAC Restaurants returns to profitability

26 Margins by Subsidiaries 26 Gross MarginsPBT Margins

27 Contents outlook 4 Update on strategic thrusts Financial performance review Overview of the business in H Larry Ettah GMD/CEO Abdul Bello CFO Joe Dada ED Corp. Services Larry Ettah GMD/CEO

28 Acquisition of Portland Paints & Products Nigeria Plc 28 Transaction consummated via secondary market trades 51% equity stake has been acquired Key Project Milestones  December Definitive Agreements Executed  May SEC Approval Obtained  June Payment for Shares/Transaction Close Valuation  Price Per Share – N4.47  Transaction Size – N912 Million

29 M&A Update 29 UAC Restaurants – Due Diligence completed. Final Discussions on-going UAC Registrars – Transaction closure shortly UPDC – Negotiation with Potential investor On-going GM Nigeria Limited - Liquidation in progress

30 UPDC REIT Highlights 30 Original plan to raise N30 billion (UPDC 40% & Public 60%) Resized REIT - N26.7 billion (UPDC N16.7 billion - 62% & Public N10.03 billion - 38%) Offer costs - N0.67 billion Unearned rent on REIT property - N2.1 billionNet Amount for UPDC - N3.1 billion REIT listed on the NSE on July

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32 Contents outlook 4 Update of strategic thrusts Financial performance review Overview of the business in H Larry Ettah GMD/CEO Abdul Bello CFO Joe Dada ED Corp. Services Larry Ettah GMD/CEO

33 H Key Priorities Tackle margin challenges across key categories Complete capacity expansion in Grand Cereals Onitsha Conclude transactions in respect of UAC Restaurants and UAC Registrars Focus on integration of new acquisitions Consolidate on existing partnerships Deliver on profit targets for the year

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35 THANK YOU 35


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