Annual Results presentation - Astral Foods · and price discounting in January and February 2013 •The impact of the US drought in 2012 impacted local Safex maize prices with poultry

1

Annual Results presentation

for the year ended 30 September 2013

2

AGENDA

Business Overview

Poultry Industry Trends

Financial Overview

Industry Matters

Prospects

Q & A

3

Business Overview


Financial Overview

Industry Matters

Prospects

Q & A

4

THE PERIOD IN PERSPECTIVE

The past twelve months to end September 2013 reflect one of the worst trading periods

experienced by the poultry industry

Financial

Indicators

Revenue

Operating profit

Earnings per share

Headline earnings per share

4%

43%

26%

44%

5


Key factors that negatively impacted the business:

• Record high poultry imports in October and November 2012 culminating in

excessive industry poultry stock levels

• Depressed sales in December 2012 followed by intense retail promotional activity

and price discounting in January and February 2013

• The impact of the US drought in 2012 impacted local Safex maize prices with

poultry feed costs peaking in January to March 2013

• Extreme drought conditions in the North West region of SA reduced the 2013

local maize crop

• The Rand depreciated by 20% for the period under review against the US Dollar

negating any benefits of lower CBOT corn prices during 2H2013

6


Violent strike action at Earlybird Olifantsfontein and County Fair resulted in a

direct cost of R37 million in 1H2013

Astral’s balance sheet remains healthy with a net debt to equity ratio of 15%

(30 September 2012: 7%)

The Group’s integrated best cost business model proved its value with the

business remaining profitable despite an industry that is generally making losses

Good performances from the Feed and Other Africa divisions have contributed

positively to the Group’s earnings

The sale of 25% of Astral’s interest in Nutec was successfully concluded with

proceeds amounting to R64 million

7

Poultry Division

8

(Operating profit - R million)

Operating loss

Profit margin negative

Feed costs up 14.1%

(Revenue - R million)

Revenue up 2.8%

Broiler volumes down 5.4%

Broiler realisations up 8.4%

5 835 6 001

-

1 000

2 000

3 000

4 000

5 000

6 000

F2012 F2013

137

-109

(120)

(70)

(20)

30

80

130

F2012 F2013

POULTRY DIVISION - OVERVIEW

9

Average broiler feed prices increased year-on-year by R563 per ton (up 14%)

Broiler selling prices increased year-on-year by 8.4%

Record levels of poultry imports in November 2012 ≈ 8 million birds per week

Record high poultry stock levels in December 2012

Planned broiler production cutbacks on back of poor sales ≈ 5%

Below cost promotional activity on IQF from January to March 2013

Continuing negative impact of above inflation energy cost increases ≈ up 11%

POULTRY DIVISION - OVERVIEW

10

Product Mix

56%

3%

10%

5%

5%

21%

IQF Mixed Portions IQF Single Portions Fresh

Value Added Frozen Tertiary

POULTRY DIVISION – SALES

11

BROILER PRODUCTION PERFORMANCES

70%

75%

80%

85%

90%

95%

100%

105%

110%

115%

120%

F2008 F2009 F2010 F2011 F2012 F2013

Mortality Feed conversion (FCR) Efficiency factor (PEF)

Key indicators base-lined to 100% in 2008

12

90%

92%

94%

96%

98%

100%

102%

104%

F2008 F2009 F2010 F2011 F2012 F2013

Slaughter age Live weight Processing yield

(37.0 days)

(34.3 days)

BROILER PRODUCTION PERFORMANCES

Key indicators base-lined to 100% in 2008

13

Projected lower feed costs in comparative first half reporting period

Broiler production efficiency improvements expected to continue

Continued realignment of poultry production capacities to reduce costs

Reduced heating / energy costs at County Fair with LPG replacement project

SAPA’s application for investigation into EU dumping of poultry accepted by ITAC

POULTRY DIVISION - PROSPECTS

14

Feed Division

15


Operating profit up 14.7%

Profit margin 6.7% (unchanged)

Rand / ton margin increase


Revenue up 13.6%

Volumes up 1%

Realisations up 13.3%

4 327

4 916

-

1 000

2 000

3 000

4 000

5 000

F2012 F2013

289

331

-

50

100

150

200

250

300

F2012 F2013

FEED DIVISION - OVERVIEW

16

FEED DIVISION - OVERVIEW

Lower in-house feed volumes (down 3%) due to lower broiler placements

External feed volumes increased by 4%

Rand per ton margin increased on prior year despite a competitive landscape

The division has shown good cost control for the reporting period

Inflationary costs were successfully recovered from the market

Maintained an acceptable level of credit risk

17

Meadow Feeds - Sales Mix

22%

49%

11%

18%

Dairy Poultry Integrated Poultry External Other

FEED DIVISION – SALES

18

FEED DIVISION - PROSPECTS

Projected lower maize plantings in new season

Normal rainfall could lead to 12,6 million ton crop in 2014

External feed sales drive to continue in the face of lower internal volumes

Continued focus to implement new cost saving technologies

Focus on Rand per ton margins to continue

New Standerton feed mill margin contribution in 2H2014

19

Other Africa Division

20


Operating profit up 19.5%

Profit margin 10.2%

New Moz hatchery included


Revenue up 29.5%

Volumes up 14.2%

Realisations up 13.4%

341

442

-

100

200

300

400

F2012 F2013

38

45

-

10

20

30

40

F2012 F2013

OTHER AFRICA DIVISION - OVERVIEW

21

OTHER AFRICA DIVISION - OVERVIEW

Zambia

Feed sales from Tiger Animal Feeds increased by 17% year-on-year through a

recovery in the small scale farming sector

Feed mill efficiencies have improved with the replacement of ageing process

equipment

The double up of the Tiger Chicks broiler breeder and hatchery operation has

progressed well with completion scheduled by end 2013

Mozambique

The new Mozpintos broiler hatchery was commissioned in 1H2013 and is running

at capacity and turning out good results

The construction of six new broiler breeder houses for Mozpintos has commenced

and is scheduled for completion in early 2014

22

F2013 Country PBIT Contribution

64%

22%

14%

OTHER AFRICA DIVISION PROFIT SEGMENTATION

F2012 Country PBIT Contribution

55%

25%

20%

Zambia Mozambique Swaziland

R38 million R45 million

23

OTHER AFRICA DIVISION - PROSPECTS

Zambia

Tiger Animal Feeds holds good maize and soya positions into the new financial

year

Increased sales of day old chicks from the double up of the hatchery and broiler

breeder operation will be realised in December 2013

The continued expansion of feed and day old chick outlets will improve product

availability and competitive feed prices direct to farm

Mozambique

The new broiler breeder houses will be commissioned during 2014 supplying the

hatchery with hatching eggs thereby replacing imported eggs

Expanding into further feed and day old chick outlets will improve market

penetration and sales

24

Business Overview


Financial Overview

Industry Matters

Prospects

Q & A

25 Source: CJA Strategic Risk Brokers

F2009 F2010 F2013 F2011 F2012

SAFEX YELLOW MAIZE PRICE


F2009 F2010 F2013 F2011 F2012

SAFEX SOYA BEANS PRICE

27

15

.44

15.8

1 16.2

8

13.9

5

13.7

8

14.0

6 14.6

0

14.0

4

13.4

1

13.8

1

13.0

9

13.1

2

13.2

2

13.4

7

13.4

1

12.7

0

11.9

6

11.9

5

11.7

5 12.2

2

11.7

5

11

.76 12.2

9

11.8

3 12.3

3 12.8

3

13.5

1

13.3

4

13.4

2

13.2

0

13

.38

13.4

6

13.1

8

12

.79

12

.86

13.5

6

13.9

1

14.9

0 1

5.5

3

14.5

1

13.6

6

13.2

1

13.4

2

13.1

5

12.6

7

12.5

1

13.4

0

15.0

3

15.7

9

15.5

5

14.8

2

13.8

5

14.0

8

15.5

3

15.3

5

15.2

4

15

.07

15.4

2

15.4

3

15.8

3

11.00

12.00

13.00

14.00

15.00

16.00

17.00

Oct-

08

Dec-0

8

Feb

-09

Ap

r-09

Ju

n-0

9

Au

g-0

9

Oct-

09

Dec-0

9

Feb

-10

Ap

r-10

Ju

n-1

0

Au

g-1

0

Oct-

10

Dec-1

0

Feb

-11

Ap

r-11

Ju

n-1

1

Au

g-1

1

Oct-

11

Dec-1

1

Fe

b-1

2

Ap

r-12

Ju

n-1

2

Au

g-1

2

Oct-

12

Dec-1

2

Feb

-13

Ap

r-13

Ju

n-1

3

Au

g-1

3

Broiler selling price Six month average

Industry trends and statistics | Source: SAPA

Rand per kilogram

INDUSTRY BROILER SELLING PRICES

28

Source: SAPA & CJA Strategic Risk Brokers

BROILER PRICE VS FOOD PRICE INFLATION

75

80

85

90

95

100

105

110

115

120

125

130

75

80

85

90

95

100

105

110

115

120

125

130

Oct-

08

Dec-0

8

Feb

-09

Ap

r-09

Ju

n-0

9

Au

g-0

9

Oct-

09

Dec-0

9

Feb

-10

Ap

r-10

Ju

n-1

0

Au

g-1

0

Oct-

10

Dec-1

0

Feb

-11

Ap

r-11

Ju

n-1

1

Au

g-1

1

Oct-

11

Dec-1

1

Feb

-12

Ap

r-12

Ju

n-1

2

Au

g-1

2

Oct-

12

Dec-1

2

Feb

-13

Ap

r-13

Ju

n-1

3

Au

g-1

3

Broiler selling price index SA food price index

29

Source: SAPA & Own Data

CHANGE IN BROILER SELLING PRICE VS FEED PRICE

-30.00%

-20.00%

-10.00%

0.00%

10.00%

20.00%

30.00%

40.00%

Oc

t-0

8

De

c-0

8

Feb

-09

Ap

r-0

9

Ju

n-0

9

Au

g-0

9

Oc

t-0

9

De

c-0

9

Feb

-10

Ap

r-1

0

Ju

n-1

0

Au

g-1

0

Oc

t-1

0

De

c-1

0

Feb

-11

Ap

r-1

1

Ju

n-1

1

Au

g-1

1

Oc

t-1

1

De

c-1

1

Feb

-12

Ap

r-1

2

Ju

n-1

2

Au

g-1

2

Oc

t-1

2

De

c-1

2

Feb

-13

Ap

r-1

3

Ju

n-1

3

Au

g-1

3

% Change in feed price % Change in broiler selling price

30

-

5 000

10 000

15 000

20 000

25 000

30 000

35 000

40 000

45 000

50 000

Oct-

08

Dec-0

8

Feb

-09

Ap

r-09

Ju

n-0

9

Au

g-0

9

Oct-

09

Dec-0

9

Feb

-10

Ap

r-10

Ju

n-1

0

Au

g-1

0

Oct-

10

De

c-1

0

Feb

-11

Ap

r-11

Ju

n-1

1

Au

g-1

1

Oct-

11

Dec-1

1

Feb

-12

Ap

r-12

Ju

n-1

2

Au

g-1

2

Oct-

12

Dec-1

2

Feb

-13

Ap

r-13

Ju

n-1

3

Au

g-1

3

Total poultry imports 6 per. Mov. Avg. (Total poultry imports)

Tons

Source: SAPA

POULTRY IMPORTS PER MONTH

31

Source: CJA Strategic Risk Brokers & SAPA

Indicators base-lined to 100% in October 2008

Index

50

75

100

125

150

175

200

225

250

50

75

100

125

150

175

200

225

250

Oct-

08

Dec-0

8

Feb

-09

Ap

r-09

Ju

n-0

9

Au

g-0

9

Oct-

09

Dec-0

9

Feb

-10

Ap

r-10

Ju

n-1

0

Au

g-1

0

Oct-

10

Dec-1

0

Feb

-11

Ap

r-11

Ju

n-1

1

Au

g-1

1

Oct-

11

Dec-1

1

Feb

-12

Ap

r-12

Ju

n-1

2

Au

g-1

2

Oct-

12

Dec-1

2

Feb

-13

Ap

r-13

Ju

n-1

3

Au

g-1

3

Broiler selling price index Broiler feed price index Imports index

BROILER PRICE VS FEED PRICE VS IMPORTS

32

Business Overview


Financial Overview

Industry Matters

Prospects

Q & A

33

ABRIDGED STATEMENT OF COMPREHENSIVE INCOME

Year ended 30 September 2013

R million

2012

R million % change

Revenue 8 524 8 160

Operating profit 272 477

Operating profit margin 3.2% 5.8%

Profit on sale of business unit 79 36

Profit before interest and tax 351 513

Net finance costs (27) (18)

Share of profit of associates 3 -

Profit before tax 327 495

Tax (80) (163)

Profit for the period 247 333

Headline Earnings 169 300

EPS – Cents 641 865

HEPS – Cents 443 787

4%

43%

32%

34%

26%

44%

26%

44%

34

1.269 1.721

2.168 2.285

3.345 3.623 4.382 4.579

5.149 5.030 5.258 5.834 6.001

1.983 2.689

2.681 2.703

2.516 2.670

3.530 5.138

3.988 3.577 3.478

4.327 4.916

2.793

3.692 3.947 4.053

4.838 5.184

6.329

6.852

7.407 7.006

7.227

8.160 8.524

0.000

2.000

4.000

6.000

8.000

10.000

12.000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Poultry Feed Other Africa Services & Ventures External revenue

GROUP ANNUAL REVENUE

(R billion)

35

POULTRY – ANNUAL REVENUE

2 741

2 408 2 581

2 449 2 606 2 652

2 878 2 956 2 952 3 049

0.00000

0.20000

0.40000

0.60000

0.80000

1.00000

1.20000

1.40000

1000

1500

2000

2500

3000

3500

4000

1H09 2H09 1H10 2H10 1H11 2H11 1H12 2H12 1H13 2H13

Revenue Change in realisations (SAPA) Change in volumes

(R million)

36

FEED – ANNUAL REVENUE

2 238

1 750 1 847

1 730 1 708 1 770

2 175 2 152

2 397 2 519

0.00000

0.20000

0.40000

0.60000

0.80000

1.00000

1.20000

1.40000

1000

1200

1400

1600

1800

2000

2200

2400

2600

2800

3000

1H09 2H09 1H10 2H10 1H11 2H11 1H12 2H12 1H13 2H13

Revenue Change in volumes Change in feed price

(R million)

37

GROUP ANNUAL OPERATING PROFIT

137 145 134 128 229 124 140

-3 -117

8

126 135 151

130

133

149 154

135 156

175

279 302 304

281

375

299 324

153

64

208

-0.1

0.1

0.3

0.5

0.7

0.9

1.1

1.3

-120

-20

80

180

280

380

1H09 2H09 1H10 2H10 1H11 2H11 1H12 2H12 1H13 2H13

Poultry Feed Services & Ventures

Other Africa Change in feed price Change in realisations (SAPA)

(R million)

38

GROUP ANNUAL OPERATING PROFIT

124 90 174 238 383 494 476 163 282 262 353 137

-109

79 130

153

151

214

272 333

385

261

281

282

289

331

203

220

328

389

597

766

809

548 581 585

674

477

272

7.3%

5.9%

8.3%

9.6%

12.3%

14.8%

12.8%

6.7%

6.6%

8.4%

9.3%

5.8%

3.2%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

-120

-20

80

180

280

380

480

580

680

780

F2001 F2002 F2003 F2004 F2005 F2006 F2007 F2008 F2009 F2010 F2011 F2012 F2013

Poultry Feed Other Africa Services & Ventures

(R million)

39

Impact of

poultry

selling price,

yield, poultry

sales

volumes,

feed price,

FCR and

industrial

action on

the Poultry

Division’s

profitability

POULTRY DIVISION PROFIT IMPACT

40

POULTRY DIVISION PROFIT SENSITIVITY

Movement in Key Indicator Annual PBIT Impact (R million)

Poultry selling price – 10 cents per kg 42,3

Poultry feed cost – R100 per ton 65,3

Poultry processing yield – 1% 54,5

Feed conversion ratio – 1 point 17,4

41

ABRIDGED STATEMENT OF FINANCIAL POSITION

At 30 September 2013

R million

2012

R million % change

Non-current assets 2 016 1 840

Net working capital 486 333

Current assets (excl. cash) 1 845 1 648

Current liabilities (excl. borrowings) (1 359) (1 315)

Non-current liabilities (excl. borrowings) (511) (502)

Assets held for sale (net) - 31

Net assets 1 991 1 702

Net debt 263 106

Structured debt 185 28

Cash and cash equivalents 78 78

Equity 1 728 1 596

Total 1 991 1 702

10%

46%

12%

3%

2%

17%

148%

17%

8%

42

CASH FLOW

For the year ended 30 September 2013

R million

2012

R million % change

Cash operating profit 388 597

Working capital requirement (151) (119)

237 478

Tax paid (67) (142)

Net interest paid (27) (18)

Capital expenditure (241) (211)

Finance received - loans 155 -

Other cash flow items (3) -

Cash flow before financing activities 54 207

Dividends paid (128) (324)

Movement in cash equivalents (74) (117)

Disposals (PPE and investments) 57 87

Opening balance (61) 69

Closing balance (78) (61)

35%

50%

28%

43

CAPITAL EXPENDITURE

Year ended 30 September 2013

R million

2012

R million

Depreciation 123 119

Replacement capex 73 106

Expansion capex - other 32 100

- new feed mill 136 -

Total capex spent 241 211

Commitments - other 111

- new feed mill 69

Total spent and committed 415

44

KEY FINANCIAL RATIOS

37 36

48 48

51

65

55

31 31 30

34

23

12

31 33

39 39

46

49

45

25 26 26

29

21

15

8.9

7.5

10.0

11.4

13.9

16.5

14.5

9.3 9.3

9.9 11.0

7.4

4.6

7.3 5.9

8.3

9.6

12.3

14.8

12.8

8.0 7.8 8.4

9.3

5.8

3.2

5.5 5.5 6.1

4.7 4.1 4.4 4.3 4.7 4.8

3.6 3.7 4.0 3.8

-

5.0

10.0

15.0

20.0

25.0

30.0

0

10

20

30

40

50

60

70

Sep-01 Sep-02 Sep-03 Sep-04 Sep-05 Sep-06 Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13

RONA ROE EBITDA margin PBIT margin Asset turn

45

KEY FINANCIAL INDICATORS

8.53

10.79

14.34

17.36

23.83

28.28

33.47 34.24

35.38

37.43

41.36 41.65

45.03

23

20

21

29

17

9

19

12

15

11 10

16

21

26

22 21

12

14

14

9

3

7

15

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

45.00

50.00

Sep-01 Sep-02 Sep-03 Sep-04 Sep-05 Sep-06 Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 Sep-13

NAV share Working capital days Net Debt / Equity

46

HEADLINE EARNINGS PER SHARE & DIVIDEND PER SHARE

(Cents per share)

272 326

487

631

958

1286

1381

840 890

960

1148

787

443

90 108 168

230

380

585

700 700 700 760

810

656

222

0

200

400

600

800

1000

1200

1400

1600

F2001 F2002 F2003 F2004 F2005 F2006 F2007 F2008 F2009 F2010 F2011 F2012 F2013

Headline earnings per share Dividend per share

47

Business Overview


Financial Overview

Industry Matters

Prospects

Q & A

48

INDUSTRY MATTERS

On 30 September 2013 a revised General Rate of Duty was introduced on all

imported poultry products (EU exempt)

The new tariffs will go some way in correcting the “uneven playing field” that has

existed for some time and severely damaged the local industry

Proposed brining levels of 8% by DAFF unresolved and both SAPA and individual

company submissions have been made in this regard

Astral supports the requirement for regulatory control around brining, however

reducing the level to 8% will lead to excessive poultry price increases

ITAC accepted an application from SAPA into alleged dumping of poultry products

from the EU after the industry showed evidence of financial harm

49

Business Overview


Financial Overview

Industry Matters

Prospects

Q & A

50

PROSPECTS

Positive Negative

Implementation of a revised General

Rate of Duty (which excludes the EU)

on poultry imports

Lower maize plantings for the new

season are projected

Projected lower feed costs in 1H2014

over the comparable period in F2013

to benefit downstream poultry

production costs

Lack of pricing power of the poultry

industry due to the continued

oversupply of chicken

Earnings contribution from the new

Standerton feed mill in the latter half

of F2014

Uncertainty over the 8% chicken

brining levels as indicated by DAFF

Growth from the other African

operations is expected to continue

Escalating zero-rated EU poultry

imports pose a threat

51

52

Business Overview


Financial Overview

Industry Matters

Prospects

Q & A

53

Additional Information

54

Strike action (1H2013)

Earlybird Olifantsfontein (Processing) – 9 week strike

County Fair (Farms) – 8 week strike

Direct cost of both strikes – R37 million

In both instances the strikes were settled at a 0% increase in wages

Wage settlements (2H2013)

All current annual wage negotiations concluded

Certain wage agreements for a two to three year period

LABOUR MATTERS

55

NEW STANDERTON FEED MILL

Construction work commenced in November 2012

Equipment installation commenced in August 2013

Full feed production by May 2014

Budgeted cost of R197 million

DTI Manufacturing Investment Programme Grant – R30 m approved October 2013

Earnings contribution to the Group for F2014 estimated at R20 m


2008/09 2009/10 2010/11 2011/12 2012/13 2013/14E 2014/15F

Actual Actual Actual Actual Actual Estimate Forecast

Carry In (1 May) 1 049 1 584 2 134 2 340 994 1 416 1 030

Crop Estimate 12 121 11 723 12 567

Sagis Delivery 11 891 11 629 12 015 10 325 11 929 11 304 12 132

Minus early deliveries 0 0 0 0 0 0 0

Imports 27 27 0 422 11 0 0

Total Supply 12 967 13 240 14 150 13 087 12 933 12 720 13 163

Domestic Usage Food 4 523 4 478 4 515 4 492 4 499 4 656 4 695

Domestic Usage Feed 4 011 4 101 4 271 4 343 4 378 4 391 4 393

Gristing, withdrawn & released 562 755 866 692 674 624 584

Total Domestic Usage 9 096 9 334 9 652 9 527 9 551 9 670 9 672

Exports & Sundries 2 287 1 772 2 158 2 554 1 966 2 019 1 995

Plus early deliveries 0 0 0 0 0 0 0

Carry Out (30 Apr) 1 584 2 134 2 340 1 006 1 416 1 030 1 496

No of days usage 64 83 88 39 54 39 56

STU 17.42% 22.87% 24.24% 10.56% 14.83% 10.65% 15.46%

Marketing year (May to April)

'000 tons

SOUTH AFRICA - TOTAL MAIZE SUPPLY & DEMAND


RSA MAIZE CARRY OUT AND STOCK TO USE RATIO

17.42%

22.87%

24.24%

10.56%

14.83%

10.65%

15.46%

0%

5%

10%

15%

20%

25%

0

500

1 000

1 500

2 000

2 500

2008/09 2009/10 2010/11 2011/12 2012/13 2013/14E 2014/15F

Carry out ('000 tons) Total maize stock to use ratio


US CORN END STOCKS AND STOCK TO USE RATIO

13.91%

13.09%

8.66%

7.92% 7.45%

15.11%

0%

2%

4%

6%

8%

10%

12%

14%

16%

0

5 000

10 000

15 000

20 000

25 000

30 000

35 000

40 000

45 000

50 000

2008/09 2009/10 2010/11 2011/12 2012/13 2013/14E

Ending stock ('000 tons) Total maize stock to use ratio


SAFEX YELLOW MAIZE VS CBOT CORN IN RAND TERMS

F2009 F2010 F2013 F2011 F2012

60

20

24

28

32

36

40

10.0

12.0

14.0

16.0

18.0

20.0

22.0

24.0

26.0

28.0

Oct-

08

Dec-0

8

Feb

-09

Ap

r-09

Ju

n-0

9

Au

g-0

9

Oct-

09

Dec-0

9

Fe

b-1

0

Ap

r-10

Ju

n-1

0

Au

g-1

0

Oct-

10

Dec-1

0

Feb

-11

Ap

r-11

Ju

n-1

1

Au

g-1

1

Oct-

11

Dec-1

1

Feb

-12

Ap

r-12

Ju

n-1

2

Au

g-1

2

Oct-

12

Dec-1

2

Feb

-13

Ap

r-13

Ju

n-1

3

Au

g-1

3

RSA broilers (slaughtered / week) Poultry imports (birds / week)

Broiler selling price (Rand / kg) Per capita consumption (kg)

Million birds per week / Rand per kg kg

Source: SAPA

LOCAL BROILER PRODUCTION, IMPORTS & PER CAPITA CONSUMPTION

61

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

F2010 20 093 40 735 60 774 77 813 97 763 124 813 142 226 160 940 185 290 209 164 229 951 252 485

F2011 24 684 48 108 76 511 103 474 127 429 156 795 182 871 215 684 250 081 286 051 320 321 349 364

F2012 33 348 67 819 100 540 135 614 170 194 204 560 244 296 278 914 305 472 326 520 353 296 387 173

F2013 47 942 89 095 117 712 145 426 172 727 207 148 243 623 282 813 316 007 343 903 371 865 409 383

0

50 000

100 000

150 000

200 000

250 000

300 000

350 000

400 000

450 000F2010 F2011 F2012 F2013

Industry trends and statistics |

Tons

+6%

Source: SAPA

TOTAL POULTRY IMPORTS (CHICKEN, TURKEY, MDM)

F2012 33 348 34 471 32 721 35 074 34 580 34 365 39 736 34618 26 558 21 048 26 776 33 877

F2013 47 492 41 153 28 617 27 714 27 301 34 421 36 475 39 190 33 194 27 896 27 962 37 518

% Var 43.8 19.4 -12.5 -21.0 -21.0 0.2 -8.2 13.2 25.0 32.5 4.4 10.7

62

IMPACT OF NEW POULTRY IMPORT TARIFF CODES

Product

August 2013

FOB Price

R/kg

Upliftment

charge - 10%

R/kg

Cost at

previous duty

R/kg

Cost at

revised duty

R/kg

Difference

R/kg

Chicken

Carcasses 4.09 4.50 5.71 5.89 0.18

Whole

Birds 14.15 15.57 19.77 28.33 8.56

Boneless

Cuts 23.04 25.34 26.61 28.39 1.77

Offal 7.23 7.95 10.10 10.34 0.24

Bone-in

Portions 14.25 15.68 17.88 21.47 3.60

63

Ex BRAZIL - November 2013

FROZEN LEG QUARTERS BULK PACKED

CIF DBN US$ per ton TON 1 600.00 1 600.00 1 600.00 SA COST

R/$ exchange rate R$ 9.00 9.50 10.00

Rand per ton TON 14 400.00 15 200.00 16 000.00 20 540.00

Rand per kg KG 14.40 15.20 16.00 20.54

Duty per kg KG 37% 37% 37% -

Clearance costs KG 0.50 0.50 0.50 -

COST INTO STORAGE KG 20.23 21.32 22.42 20.54

Storage KG 0.50 0.50 0.50 -

Distribution KG 0.60 0.60 0.60 0.69

Financing KG 0.60 0.60 0.60 0.62

TOTAL COST KG 21.93 23.02 24.12 21.85

Ex EUROPE - November 2013

FROZEN LEG QUARTERS BULK PACKED

CIF DBN US$ per ton TON 1 630.00 1 630.00 1 630.00 SA COST

R/$ exchange rate R$ 9.00 9.50 10.00

Rand per ton TON 14 670.00 15 485.00 16 300.00 20 540.00

Rand per kg KG 14.67 15.49 16.30 20.54

Duty per kg KG 0% 0% 0% -

Clearance costs KG 0.50 0.50 0.50 -

COST INTO STORAGE KG 15.17 15.99 16.80 20.54

Storage KG 0.50 0.50 0.50 -

Distribution KG 0.60 0.60 0.60 0.69

Financing KG 0.60 0.60 0.60 0.62

TOTAL COST KG 16.87 17.69 18.50 21.85


BRAZIL & EUROPE PRODUCT COST BENCHMARK

64

49%

8%

16%

10%

5%

12%

2013 YTD

TOTAL POULTRY IMPORTS – COUNTRY SPLIT

2012

52%

7%

14%

7%

6%

14%

Brazil Argentina Netherlands

UK Germany Other

Source: SAPA

+6%

65

1%

41%

5% 14%

39%

2013 YTD

TOTAL POULTRY IMPORTS – PRODUCT SPLIT

2012

7%

44%

6% 8%

35%

Whole chicken Leg quarters

Chicken fillets Chicken offal

MDM

Source: SAPA

66

1 000

1 500

2 000

2 500

3 000

3 500

4 000

4 500

5 000

5 500

Ma

r-0

8

Ju

n-0

8

Sep

-08

Dec-0

8

Ma

r-09

Ju

n-0

9

Sep

-09

Dec-0

9

Ma

r-10

Ju

n-1

0

Sep

-10

Dec-1

0

Ma

r-11

Ju

n-1

1

Sep

-11

Dec-1

1

Ma

r-12

Ju

n-1

2

Sep

-12

De

c-1

2

Ma

r-13

Ju

n-1

3

Sep

-13


Sheep

Beef

Pork

Chicken

Chicken Pork Beef Sheep

Feed Conversion Rate 1.7 2.2 5.5 5.0

Per Capita Consumption 2013 Est. 39 kg 2012 Act. 4.6kg 2012 Act. 16.5kg 2012 Act. 2.8kg

Source: SAPA & FNB

PRODUCER PRICE COMPARISON – SA PROTEIN

Cents per kg

67

Tel: +27 (0) 12 667 5468

Fax: +27 (0) 86 504 2002

Astral Foods Corporate Office

92 Koranna Avenue,

Doringkloof Centurion, 0157,

Gauteng, South Africa

Chris Schutte

Chief Executive Officer

Tel : +27 (0) 12 667 5468

Fax : +27 (0) 86 504 2002

Email: [email protected]

Website: www.astralfoods.com

Daan Ferreira

Group Financial Director

Tel : +27 (0) 12 667 5468

Fax : +27 (0) 86 504 1602

Email: [email protected]

Astral Foods Limited

CONTACTS

Documents

Annual Results presentation - Astral Foods · and price discounting in January and February 2013 •The impact of the US drought in 2012 impacted local Safex maize prices with poultry