Investor Roadshow Lugano, 4 November 2014 Nikolai Baltruschat (Head of Investor Relations) Südzucker Group, page 1 FINANCIAL TRANSPARENCY Disclaimer This presentation contains forward looking statements. The statements are based on current assumptions and estimates made by the executive board and information currently available to its members. The forward looking statements are not to be viewed as guarantees of the future developments and results presented therein. Future developments and results are in fact dependent on a variety of factors and are subject to various risks and imponderables. They are based on assumptions that could in fact prove to be invalid. The risk management report in the 2013/14 annual report on pages 99 to 110 presents an overview of the risks. We assume no obligation to update the forward-looking statements made in this presentation. This presentation includes percentage and number rounding. IFRS 11 application as of financial year 2013/14. Written and visual value statements are standardized as follows: ± 1% stable Südzucker Group, page 2 / ± 1-4% slight / ± 4-10% moderate / >/< 10% significant FINANCIAL TRANSPARENCY Agenda 1. Overview and strategic objectives page 4 2. Financing page 11 3. Development of Segments Sugar page 16 Special Products page 30 CropEnergies page 38 Fruit page 43 4. Financial Highlights Q1 2014/15 page 48 5. Outlook 2014/15 page 59 6. Appendix Long-term development and key figures page 69 Additional information page 79 Südzucker Group, page 3 FINANCIAL TRANSPARENCY Südzucker Group at a glance Global operating German food group with long-standing corporate history: Market Cap and Shareholder Structure* 1837: Foundation of first sugar company Zucker Invest GmbH (10%) 1926:Foundation of Süddeutsche Zucker-AG Revenues: 7,533 bn € Free float (38%) Südzucker ~2.2 bn € 1 Südzucker indirect via Z&S (43%) Operating profit: 622 € 1 SZVG** (52%) Production facilities: ~ 100 Employees: ~18.200 1 Beneficiary of mega trends within food, animal feed and energy area Stock exchange listing in Germany MDAX-member Trading volume: ~ 1.2 mn shares/day 1 IFRS 11 adjusted Südzucker Group, page 4 Südzucker direct (~7%) Agrana ~1.0 bn € Z&S*** (86%) Free float (7%) SZVG* (7%) Südzucker (69%) Crop Energies ~360 mn € Free float (24%) * Oct. 2014 ** Süddeutsche Zuckerrübenverwertungs-Genossenschaft eG *** Z&S Zucker und Stärke Holding AG (~50% Südzucker, ~50% ZBG (ZuckerBeteiligungsgesellschaft m.b.H.)) FINANCIAL TRANSPARENCY Group – Key Figures remain on high level 2010/11 2011/12 2012/13 2013/14* Revenues EBITDA 6.161 775 6.992 1.015 7.879 1.246 7.533 889 EBITDA-Margin 12,6% 14,5% 15,8% 11,8% 521 751 972 622 8,5% 10,7% 12,3% 8,3% -8 513 8 759 -17 955 -115 554 Cash flow Net Financial Debt Equity Ratio 606 854 50,8% 823 791 47,9% 996 464 53,7% 697 536 53,8% Total investments Capital Employed RoCE 251 5.314 9,8% 286 5.707 13,2% 521 5.950 16,3% 399 5.874 10,6% 1,33 2,92 0,55 1,99 3,20 0,70 3,08 4,88 0,90 (mn €) Operating profit Operating Margin Restructuring and special items Income from operations (EBIT) Earnings per share (€) Cashflow per share (€) Dividend per share (€) * IFRS 11 adjusted ** incl. one-off positive tax effect of 0.40 € Südzucker Group, page 5 ** 1,38 3,41 0,50 FINANCIAL TRANSPARENCY Key Figures 2013/14* (mn €) Sugar Special Prod. CropEnergies Fruit Group Revenues EBITDA 3.901 559 1.740 156 720 69 1.172 106 7.533 889 EBITDA-Margin 14,3% 9,0% 9,5% 9,0% 11,8% Depreciation Operating profit -12 438 -71 85 -34 35 -41 65 -267 622 11,2% 4,9% 4,9% 5,5% 8,3% Operating Margin Cash flow Investments in fixed assets Capital Employed RoCE (incl. Goodwill) RoCE (excl. Goodwill) 197 110 18 52 697 377 3.187 13,7% 18,1% 1.343 6,3% 8,0% 544 6,4% 6,4% 801 8,1% 9,2% 5.874 10,6% 13,2% Equity Ratio Gearing (NFD/Equity) 53,8% 11,5% Earnings per share (€) Dividend per share (€) 1,38 0,50 * IFRS 11 adjusted; 2013/14 RoCE (incl. Goodwill) unadjusted: Group 11.0%, sugar 13.6%, special products 8.7%, CropEnergies 6,3%, fruit 8.1% Südzucker Group, page 6 FINANCIAL TRANSPARENCY Group Segments Return on Capital Employed (RoCE) RoCE) 2009/10 2010/11 2011/12 2012/13 2013/14* Sugar 7.5% 10.4% 17.1% 22.4% 13.7% Special Prod. Prod. 10.5% 10.8% 10.7% 9.5% 6.3% CropEnergies 2.3% 8.7% 10.2% 17.3% 6.4% Fruit 5.5% 6.7% 4.7% 5.0% 8.1% RoCE 7.5% 9.8% 13.2% 16.3% 10.6% Operating Profit 403 mn € 521 mn € 751 mn € 972 mn € 622 mn € Capital Employed 5,374 mn € 5,314 mn € 5,707 mn € 5,950 mn € 5,874 mn € * IFRS 11 adjusted; 2013/14 unadjusted: Group 11.0%, sugar 13.6%, special products 8.7%, CropEnergies 6,3%, fruit 8.1% Südzucker Group, page 7 FINANCIAL TRANSPARENCY Leading Market Positions and clear Strategic Objectives Segment/Division Market Position Strategy / Main Drivers Sugar #1 in Europe Further enhancement of leading market position in Europe; especially in deficit markets Expedite internationalization; partnership with ED&F Man BENEO #1 worldwide in Isomalt and Oligofructose Leverage strength of core products into product innovations #1 in Europe in frozen Pizza (private label) Further internal and external growth Freiberger Starch PortionPack CropEnergies Fruit Preparations Fruit Juice Concentrates Südzucker Group, page 8 #1 in Europe in portion packs One of the leading bioethanol players in Europe #1 worldwide #1 in Europe Focus on specialty starches Market share expansion through new facilities Development of product portfolio and regions Full exploitation of implemented capacity build-up Consolidation of the leading position Integration of Ensus Take full benefit of global increase in demand for healthy food and upmarket products through new facilities (e.g. USA) Usage of integrated platform to raise synergies in combined global sourcing and distribution New platform with Austria Juice supports growth and profitability FINANCIAL TRANSPARENCY Portfolio benefits from megatrends mn t 8,000 sugar consumption worldwide 6,000 USD 211,000 8,000 171,000 6,000 per capita income worldwide 131,000 4,000 91,000 4,000 2,000 population growth worldwide 51,000 emerging markets 11,000 Sources: United Nations, F.O. Licht mn barrel / day 100 2,000 ,0 Source: ERS International Macroeconomic Data Set USD / barrel oil consumption 120 mn t 800 100 80 80 600 60 global animal feed production 60 40 40 20 0 Source: BP Südzucker Group, page 9 400 20 crude oil price 0 200 Source: USDA FINANCIAL TRANSPARENCY Agenda 1. Overview and strategic objectives page 4 2. Financing page 11 3. Development of Segments Sugar page 16 Special Products page 30 CropEnergies page 38 Fruit page 43 4. Financial Highlights Q1 2014/15 page 48 5. Outlook 2014/15 page 59 6. Appendix Long-term development and key figures page 69 Additional information page 79 Südzucker Group, page 10 FINANCIAL TRANSPARENCY Rating Rating agency * since 20 June 2014 ** since 27 March 2014 *** since 17 June 2014 **** since 28 November 2013 Südzucker Group, page 11 LongLong-term rating ShortShort-term rating BBB * Stable Outlook ** A–2 Baa 2 *** Stable Outlook **** P–2 FINANCIAL TRANSPARENCY Comfortable liquidity position 28.02.2014* 28.02.2011 28.02.2012 28.02.2013 - 854 - 791 - 464 - 536 506 715 631 648 - 1.360 - 1.506 - 1.096 - 1.183 Long- t erm financ ial debt - 548 - 931 - 808 - 681 Short- t erm financ ial debt - 812 - 574 - 288 - 502 1.029 1.103 958 759 478 410 427 313 600 600 600 600 600 600 600 600 0 0 450 450 0 0 440 373 600 600 600 600 600 450 600 510 2.184 2.175 2.698 2.444 (mn €) N et financ ial debt Cas h & Cas h equivalents / s ec urit ies Gros s financ ial debt Bank c redit lines : undrawn Syndic ated loan f ac ility undrawn Syndic ated loan f ac ility Agrana undrawn Commerc ial paper program undrawn = Total liquidity reserv es * IFRS 11 adjusted Südzucker Group, page 12 FINANCIAL TRANSPARENCY Financing maturity profile* profile* (mn €) as of August 31, 2014 400 EUR-Bond Promissory 45** 2014 58 45 2015 2016 2017 2018 2019 Südzucker Syndicated loan 2013/2018 600 mn € (back-up facility) Agrana Syndicated loan 2014/2019 300 mn € Commercial Paper Programm 600 mn € (perpetual) Hybrid Bond 700 mn € (perpetual) 5.25 % before June 2015 / since June 2015 3M-Euribor + 310 bp margin * Displayedto 2019; 10-year tranche of Agrana promissory note in the amount of 7 mn € due in 2022 ** in Q1 2014/15 redeemed Südzucker Group, page 13 Note FINANCIAL TRANSPARENCY Hybrid bond 2005 / cash flow covenant (mn €) Revenues Cash flow Cash flow / Revenues 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14* 2014/15e 5.347 5.765 5.780 5.871 5.718 6.161 6.992 7.879 7.533 ~ 7.000 527 554 498 504 553 606 823 996 697 > 450 9,9% 9,6% 8,6% 8,6% 9,7% 9,8% 11,8% 12,6% 9,3% > 6,5% * IFRS 11 adjusted Cash flow covenant (cash flow / revenues >5 %) so far significantly exceeded Cash flow covenant fulfillment also expected in 2014/15 Options for hybrid bond (depending on continuous financial planning): Open market tender at any time (§ 6 (7)) First time call possibility June 2015 (§ 6 (5) & (6)); condition: Comparable instrument replacement within 12m period before No action: Variable coupon based on 3M-Euribor + 310 bp margin Currently preferred option „no action“ Südzucker Group, page 14 FINANCIAL TRANSPARENCY Agenda 1. Overview and strategic objectives page 4 2. Financing page 11 3. Development of Segments Sugar page 16 Special Products page 30 CropEnergies page 38 Fruit page 43 4. Financial Highlights Q1 2014/15 page 48 5. Outlook 2014/15 page 59 6. Appendix Long-term development and key figures page 69 Additional information page 79 Südzucker Group, page 15 FINANCIAL TRANSPARENCY Segment Sugar: Key figures (mn €) * 2010/11 2011/12 2012/13 2013/14 Revenues EBITDA 3.279 399 3.728 626 4.232 830 3.901 559 EBITDA-Margin 12,2% 16,8% 19,6% 14,3% 285 511 708 438 8,7% 13,7% 16,7% 11,2% Restructuring and special Income from operations (EBIT) -3 282 13 524 6 714 -110 345 Investments 130 148 384 219 Fixed Assets Financial Assets 125 5 145 3 203 181 197 22 Capital Employed RoCE 2.748 10,4% 2.984 17,1% 3.158 22,4% 3.187 13,7% Operating profit Operating Margin * IFRS 11 adjusted Südzucker Group, page 16 FINANCIAL TRANSPARENCY EU sugar market* market* - supply and demand World Market EU Production EU Demand World Market „Quota sugar“ sugar“ ~16~16-17 mn t 3-4 mn t ~13 mn t CAGR 22-3% o/w SZ: Mauritius ~0.4 mn t Raw sugar imports for raffination through SZ ~0.3 mn t Demand** 176 mn t Production** Production** 181 mn t o/w SZ 3.2 mn t o/w SZ ~25% up to 0.4 mn t ~2~2-3 mn t max. ~1.4 mn t ~3~3-4 mn t „Non„Non-quota sugar“ sugar“ Südzucker Group, page 17 *Simplified, excl. isoglucose **F.O. Licht estimate for 2013/14, June 2014 FINANCIAL TRANSPARENCY Segment Sugar – Market environment (I): World market World Sugar Balance (mn t) 184.6 174.9 168.1 165.5 162.4 181.2 172.4 Sugar world market price (€/t) 175.6 550 500 White sugar 450 76.1 73.0 400 64.7 58.6 350 300 2010/11 36.1% * Production 2011/12 38.5% * Consumption 2012/13 42.3% * 2013/14e 43.3% * Sep-12 Mar-13 Sep-13 Mar-14 Ending stock * Ending stock in % of consumption World sugar market well supplied Südzucker Group, page 18 250 Low sugar world market price Sep-14 FINANCIAL TRANSPARENCY Segment Sugar – Market environment (II): (II): EU EU quota sugar inventory (mn t) Influence of low world market price via imports Still high EU quota sugar inventories through EU commission measures (+1.2 mn t) Tougher competition for contracts. Decreasing shares of annual contracts, higher share of short term contracts respectively supply via spot market 3.0 2.5 2.2 Sept.'07 Significantly lower EU sugar pricing Sept.'08 Sept.'09 2.1 1.6 1.6 1.0 1.1 Sept.'10 Sept.'11 Sept.'12 Sept.'13 Sept.'14e Price reporting EU-KOM (€/t) 750 700 Increasingly more difficult market environment Full effect in FY 2015/16 650 600 550 500 Apr-13 Südzucker Group, page 19 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 FINANCIAL TRANSPARENCY EU quota sugar production - sugar marketing year* year* 2013/14 Market share** share** EU quota sugar production Südzucker Group (24 %) Südzucker quota share per country (in %) Great Britain Nordzucker (15 %) Poland 25 Germany Tereos (11 %) Belgium 72 25 Czech Slovakia Republic 39 40 Moldova 100 20 British Sugar (11 %) All others (16 %) Royal Cosun (7 %) Cristal Union (8 %) * Sugar marketing year: Oct. – Sep. ** Südzucker estimates Südzucker Group, page 20 Pfeifer & Langen (8 %) Austria 100 Hungary France Portugal BosniaBosniaHercegowina 35 Rumania Bulgaria Italy Greece Spain Südzucker distribution entities NonNon-EU production FINANCIAL TRANSPARENCY Mauritius cooperation strengthens distribution power in the EU Exclusive distributor of ~ 400,000 tonnes p.a. sugar contingent from Mauritius into the EU until 2015 Imported sugar volume… …leverages European distribution platform …supports core regions …supports market position in European deficit markets 400,000 tonnes sugar Distribution power of Südzucker Group builds on ~ 5.0 million tonnes sugar (consisting of production of quota sugar, industrial sugar and refined sugar as well as imported sugar from Mauritius) Südzucker Group, page 21 Mauritius FINANCIAL TRANSPARENCY Participation in ED&F Man offers a global footprint Private, employee owned company, founded 1783 ~ 3,400 employees in 60 countries Revenues: 9 bn USD Profit from ordinary activities: 299 mn USD Operations: Sugar only Sugar: Liquid Products only Coffee only Multiple businesses Approx. 9 mn t trading volume with significant presence in Central and South America, Far East, South East Asia and Africa Participations in production and refining capacities amongst others in Russia, the Ukraine, Mexico, Chile and Venezuela Marketing of coffee and molasses Trading in biofuels, edible oils as well as shipping and financial services Südzucker Group, page 22 FINANCIAL TRANSPARENCY EU sugar and agriculturial policy road map 2006 2010 2014 2013 26 June 2013: Decision about CAP and EU sugar policy 2017 2020 Common Agricultural Policy (CAP) 2014 - 2020 19.03.2014: GAP ratification in accordance with EU-Council of Ministers Transition Period into... … new EU sugar policy Quota reduction Run-time: until 30 September 2015 Südzucker Group, page 23 EU sugar policy: Extension to 30 September 2017 New market framework 1 October 2017 Extension for sugar and isoglucose quota No quota for sugar or isoglucose Confirmation of overall framework …but EU border protection still in place Liberalised EU sugar market… FINANCIAL TRANSPARENCY Segment Sugar: Mid term Outlook (I) EU sugar policy New market framework until 30 September 2017 1 October 2017 Extension sugar and isoglucose quota Elimination of sugar and isoglucose quota Quota sugar: Minimum beet price No minimum beet price Contractual duty between industry and farmer Contractual duty between industry and farmer Specification of “EU-Toolbox”: Temporary options: Market withdrawals, convertion of nonquota into quota sugar, import tender Exports limited to about 1.4 mn t p.a. Private storage No export restrictions Further measures (e.g. “security net”) require resolution Border Protection: unchanged Import duty 419 €/t (white sugar) resp. 339 €/t (raw sugar) from non-preferential countries Preferential agreements with LDC-/ACP- and Andean countries: unchanged Südzucker Group, page 24 FINANCIAL TRANSPARENCY Segment Sugar: Mid term Outlook (II) EU sugar demand currently EU sugar demand as of October 1, 2017 served by served by EU beet sugar 70 % EU EU sugar demand b eet sug ar 19 mn t 10 % EU sugar demand 19 mn t Imports 16 % EU isoglucose 4% Quota Non-Quota Max. Export Volume (WTO): about 1.4 mn t Südzucker Group, page 25 No export restrictions FINANCIAL TRANSPARENCY Segment Sugar: Implications for Südzucker Opportunities Südzucker is in good starting position as largest producer with focus on best growing regions Only limited effort needed to increase and extend current production level (with high entry barrier at the same time) Utilization of current European logistic network to optimize sugar distribution and development of new markets Investment program to exploit future market potential (e.g. starch) Strengthening and extension of cooperations (e.g. ED&F Man, LDC/ACP producer) Südzucker Group, page 26 Challenges Stronger competition, possibly also from Isoglucose Further EU free trade agreements with third party countries Raw material security in increasingly more volatile market environment Volatility in world market price and volume with stronger influence on EU market FINANCIAL TRANSPARENCY Segment Sugar: Outlook 2014/15 Sales revenue decrease with full year effect Revenues Increased trend towards spot business Significant revenue decrease (Previous year*: 3,901 mn €) Operating Profit Decreasing price level in light of increasingly worsening economic environment in EU sugar market Burden from increase in fixed costs per tonne due to once again shorter campaign 2013 Significant decrease to about 30-70 mn € (Previous year*: 436 mn €) * 2013/14 adjusted for IFRS 11 effects Südzucker Group, page 27 FINANCIAL TRANSPARENCY Segment Sugar: Mid term Outlook Global demand trend of ~ 2% p.a. growth intact (population growth, increase in per-capita income…) Recovery of world market price Operating Profit Perspective Temporary EU market distortion in transition period ~ 250 mn € Strong market position in combination with strong foothold in best growing area in the centre of demand Necessary efficiency improvements Increase in production ~120 days (fixed cost degression) Omission of EU minimum beet price / flexible beet price payment ~ 30 to 70 mn € Cost savings program Capex Maintenance Administration (further centralization) No restrictions on exports anymore (partnership with ED&F Man) Südzucker Group, page 28 2014/15 mid term FINANCIAL TRANSPARENCY Agenda 1. Overview and strategic objectives page 4 2. Financing page 11 3. Development of Segments Sugar page 16 Special Products page 30 CropEnergies page 38 Fruit page 43 4. Financial Highlights Q1 2014/15 page 48 5. Outlook 2014/15 page 59 6. Appendix Long-term development and key figures page 69 Additional information page 79 Südzucker Group, page 29 FINANCIAL TRANSPARENCY Segment Special Products: Key figures (mn €) * 2010/11 2011/12 2012/13 2013/14 Revenues EBITDA 1.575 218 1.806 231 1.862 214 1.740 156 EBITDA-Margin 13,8% 12,8% 11,5% 9,0% 144 149 132 85 9,1% 8,3% 7,1% 4,9% -6 138 -3 146 -4 128 3 118 68 74 91 110 Fixed Assets Financial Assets 67 1 74 0 89 2 110 0 Capital Employed RoCE 1.335 10,8% 1.392 10,7% 1.390 9,5% 1.343 6,3% Operating profit Operating Margin items Income from operations (EBIT) Investments * IFRS 11 adjusted Südzucker Group, page 30 FINANCIAL TRANSPARENCY Segment Special Products Revenues (mn €) BENEO: World market leader with premium food ingredients like Isomalt, Inulin, Oligofructose or rice starch 1,575 1,740 1,396 1,283 Freiberger: Private-label chilled and deep frozen convenience food (Pizza, Pasta, Baguettes) 1,806 1,427 2 008/09 2 009/10 2010/11 2011/12 2012/13 2013/14* Revenue split 2013/14* Starch: Starch, starch niche products for food and non-food industry, isoglucose and AGRANA bioethanol activities PortionPack: Various portioned products; wide range of products of food and nonfood articles PortionPack 8% Freiberger 29% Starch* 40% 1,740 mn € BENEO (Functional Food) 23% * IFRS 11 adjusted ** incorporates AGRANA bioethanol and starch activities Südzucker Group, page 31 FINANCIAL TRANSPARENCY Segment Special Products: Division BENEO BENEO Group bundles Functional Food-operations Worldwide unchanging growing demand for Functional Food ingredients in view of increasing competition Increase in awareness for healthy food and growing per-capita income (emerging markets) Market leadership in main product categories BENEO-Orafti (prebiotic fibres from chicory roots): Core products Inulin and Oligofructose; distribution of CropEnergies by-product BeneoPro W BENEO-Palatinit (functional carbohydrates): Global leadership with Isomalt. Successful positioning of product innovations Palatinose™ and galenIQ™ Sales Offices Regional Centers Production facility BENEO-Remy (rice starches): e.g. rice starches, rice flours, rice bran, rice concentrates, … Exploitation of growth potential of our core products Development of new markets via innovations Offstein Südzucker Group, page 32 FINANCIAL TRANSPARENCY Segment Special Products: Division Starch* Starch* Well established player as manufacturer of specialty starches for the paper, textile, cosmetics, pharmaceutical and construction industries Principal focus on organic and GM-free starches for the food industry Commisioning of new Agrana starch factory for production of wheat starch and gluten at the site of bioethanol plant in Pischelsdorf (June 2013). Investment of 70 mn €. Capacity for 107,000 t wheat starch, 23,500 t wheat gluten, 55,000 t wheat bran and 70,000 t of material substitutes („B+C starch“) for bioethanol. New modular concept with new Südzucker starch factory planned at the site of bioethanol plant in Zeitz. Comissioning planned in 2015. Investment of 125 mn €. Capacity for up to 140,000 t wheat starch products. Gmünd (A) Aschach (A) Pischelsdorf (A) Szabadegyhaza (HU) Tandarei (RO) Production starch Production bioethanol * incorporates AGRANA bioethanol and starch activities Südzucker Group, page 33 Pischelsdorf FINANCIAL TRANSPARENCY Segment Special Products: Division Freiberger Freiberger produces and markets chilled and frozen pizzas as well as frozen pasta and baguettes Solutions are specifically geared toward the strategies of its business partners: retail industry, caterers and food service operators Unrivalled European market leader for own label/private lable frozen pizzas Successful reconception of site in Westhoughton, UK Distribution center USA Westhoughton Berlin Osterweddingen Muggensturm Production facility Südzucker Group, page 34 Oberhofen Muggensturm FINANCIAL TRANSPARENCY Segment Special Products: Division PortionPack Europe European market leader in individually packaged portions for the food and non-food sectors In addition to conventional sugar packets, product range includes a wide spectrum of other food portion packs such as baked-goods, chocolate and sandwich spreads Besides to the out-of-home market (restaurants, hotels, caterers) and food retailers, PortionPack Europe also services industry and the advertising/promotion sectors Telford OudOud-Beijerland (NL) Herentals (B) Landgraaf (NL) Nuremberg Barcelona Krakow Prague facility Prague Südzucker Group, page 35 FINANCIAL TRANSPARENCY Segment Special Products: Outlook 2014/15 Revenues Divisions Freiberger, Beneo and PortionPack overall performance to be stable Division starch with slight decrease Slight decrease in revenues (Previous year*: 1,740 mn €) Operating Profit Significant increase in operating profit supported by all divisions Significant increase in operating profit (Previous year*: 85 mn €) * 2013/14 adjusted for IFRS 11 effects Südzucker Group, page 36 FINANCIAL TRANSPARENCY Agenda 1. Overview and strategic objectives page 4 2. Financing page 11 3. Development of Segments Sugar page 16 Special Products page 30 CropEnergies page 38 Fruit page 43 4. Financial Highlights Q1 2014/15 page 48 5. Outlook 2014/15 page 59 6. Appendix Long-term development and key figures page 69 Additional information page 79 Südzucker Group, page 37 FINANCIAL TRANSPARENCY Segment CropEnergies: CropEnergies: Key figures 2010/11 2011/12 2012/13 2013/14* 437 76 529 84 645 119 720 69 17,5% 15,9% 18,5% 9,5% 46 53 87 35 10,5% 10,0% 13,5% 4,9% Restructuring and special Income from operations (EBIT) 1 47 -1 52 0 87 -7 28 Investments 22 14 11 18 Fixed Assets Financial Assets 22 0 14 0 11 0 18 0 Capital Employed RoCE 530 8,7% 519 502 17,3% 544 6,4% (mn €) Revenues EBITDA EBITDA-Margin Operating profit Operating Margin * IFRS 11 adjusted Südzucker Group, page 38 10,2% FINANCIAL TRANSPARENCY Segment CropEnergies: CropEnergies: Development 2013/14 (II) Quotation: Platts fuel-EtOH T2 €/m3 Market development: 700 Only moderate decreasing grain prices Decrease in fuel demand 600 EU decides that US bioethanol imports via Norway have to face anti-dumping taxes 500 Strong ethanol price decrease since autumn 2013 Acquisition Ensus: 400 Oct-13 Dec-13 Feb-14 Boost of nominal capacity by 400,000 m3 p.a. to ~1.2 mn m3 p.a. bioethanol and production of food and animal feed to ~1 mn t p.a. Capex program 60 mn €; efficiency gains and increase in purchase and sales flexibility Jun-14 Aug-14 Wilton Rotterdam Duisburg LoonLoon-Plage Wanze Houston Santiago de Chile Zeitz São Paulo Production facility Südzucker Group, page 39 Apr-14 Tank storage Trading Oct-14 FINANCIAL TRANSPARENCY EU biofuels market and policy Amendment of “Renewable Energies Directive” and “Fuel Quality Directive” European council agreement in June 2014 prepares for second reading in EU Parliament 15,000 12,500 (in 1,000 m3) In light of current discussions member states do not increase blending quotas at this point in time EU: Market potential and market reality Market NAP 10,000 7,500 5,000 2,500 ,0 2010 2011 2012 2013 2014 2016 2018 2020 Source: National action plans of EU Member States (2010); F.O. Licht (2014) Politics Germany: Adjustment towards green house gas reduction targets in 2015 Belgium: New program for biofuel usage Great Britain: Reluctance for E10 introduction in light of ongoing EU debate Südzucker Group, page 40 FINANCIAL TRANSPARENCY Segment CropEnergies: CropEnergies: Outlook 2014/15 Revenues Increase in production and sales of bioethanol, food and animal feed via new production site Ensus and further optimization in production facilities Revenue increase of 5-10 % to above 750 mn € (Previous year*: 720 mn €) Operating Profit High volatility in bioethanol and raw material pricing impede forecast High price sensitivity; 10 € price change per cubicmeter bioethanol leads to about 10 mn € earnings impact Operating profit is expected in a range of -20 to 0 mn € (Previous year*: 36 mn €) EBITDA in range of +20 to +40 mn € (Previous year*: 69 mn €) * 2013/14 adjusted for IFRS 11 effects Südzucker Group, page 41 FINANCIAL TRANSPARENCY Agenda 1. Overview and strategic objectives page 4 2. Financing page 11 3. Development of Segments Sugar page 16 Special Products page 30 CropEnergies page 38 Fruit page 43 4. Financial Highlights Q1 2014/15 page 48 5. Outlook 2014/15 page 59 6. Appendix Long-term development and key figures page 69 Additional information page 79 Südzucker Group, page 42 FINANCIAL TRANSPARENCY Segment Fruit: Fruit: Key figures (mn €) * 2010/11 2011/12 2012/13 2013/14 870 81 929 74 1.140 83 1.172 106 9,4% 7,9% 7,3% 9,0% 46 38 45 65 5,4% 4,1% 4,0% 5,5% Restructuring and special items Income from operations (EBIT) 0 46 -1 37 -19 26 -1 64 Investments 31 50 35 52 Fixed Assets Financial Assets 31 0 43 7 35 0 52 0 Capital Employed RoCE 702 812 4,7% 900 5,0% 801 8,1% Revenues EBITDA EBITDA-Margin Operating profit Operating Margin * IFRS 11 adjusted Südzucker Group, page 43 6,7% FINANCIAL TRANSPARENCY Segment Fruit – with leading positions in both divisions Overview Division Fruit preparations: World market leader Customers: dairy, baking and ice cream industry Division Fruit juice concentrates: Leading European producer (market leader in apple juice concentrates) Core competences Upgrading of agricultural raw material into premium preliminary products for food industry Global sourcing and distribution of fruit ingredients Positioning & Strategy Production facility Shared customer base with segments/divisions sugar, BENEO and starch Growth drivers: Especially yogurt drinks rank among the fastest growing food products globally Increase in awareness for healthy food and growing per-capita income (emerging markets) Further growth via fruit juice concentrates merger Reorganisation measures in division fruit preparations in Central Europe New US facility for fruit preparations Total investments 30 mn € Production capacity 45,000 tonnes annually Südzucker Group, page 44 AGRANA J&F Holding GmbH AGRANA Fruit S.A.S. Fruit preparations AUSTRIA JUICE GmbH Fruit juice concentrates ~75% of segment revenues ~25% of segment revenues ⅓ of world market European market leader 26 facilities worldwide 14 facilities worldwide FINANCIAL TRANSPARENCY Division Fruit Preparations: Preparations: Fourth production site USA US market offers average annual growth of about 6 % – in contrast to the flat European market –, particularly in view of the trend toward fruit yoghurts containing a high proportion of fruit preparation. Expanding market presence in North America by constructing a fruit preparation plant in Lysander, NY (Northeastern region of the US). Production started 31 March 2014 New facility will serve as a response to rising customer demand in Canada and the Northeastern Region of the US New production capacity of 45,000 t p.a. Total investment amounts to around € 30 million Production facility Südzucker Group, page 45 FINANCIAL TRANSPARENCY Segment Fruit: Fruit: Outlook 2014/15 Revenues Significantly lower revenues in division fruit juice concentrates no fully compensated by higher volumes in division fruit preparations Revenues on prior year‘s level (Previous year: 1,172 mn €) Operating Profit Stable earnings in division fruit preparations despite start-up losses of new US plant Slightly lower earnings in division fruit juice concentrates Operating profit on prior year‘s level (Previous year: 65 mn €) Südzucker Group, page 46 FINANCIAL TRANSPARENCY Agenda 1. Overview and strategic objectives page 4 2. Financing page 11 3. Development of Segments Sugar page 16 Special Products page 30 CropEnergies page 38 Fruit page 43 4. Financial Highlights Q1 2014/15 page 48 5. Outlook 2014/15 page 59 6. Appendix Long-term development and key figures page 69 Additional information page 79 Südzucker Group, page 47 FINANCIAL TRANSPARENCY Group income statement nd 2 (mn €) Revenues EBITDA EBITDA margin Depreciation Operating profit Operating margin Restructuring costs/special items Income from companies consolidated at equity Income from operations Net earnings for the period attributable to Südzucker shareholders Earnings per share (€) (undiluted) Cash flow Investments in fixed assets* Net financial debt (as of reporting date) Average number of employees * Including intangible assets Südzucker Group, page 48 2014/15 1.709 102 quarter 2013/14 1.958 237 6,0% 12,1% -51 51 -50 187 3,0% 9,6% 7 9 67 -3 15 199 26 0,13 94 102 115 0,57 204 103 st +/- in % -12,7 -56,8 1 half year 2014/15 2013/14 3.482 3.937 249 506 +/- in % -11,6 -50,9 7,1% 12,9% -102 147 -99 407 4,2% 10,3% -37,7 -66,6 7 19 173 -1 26 432 -26,8 -60,0 -77,2 -77,2 -53,8 -1,5 75 0,37 247 168 422 18.477 247 1,21 454 166 276 18.100 -69,6 -69,4 -45,7 1,1 52,8 2,1 2,2 -72,6 2,9 -63,9 FINANCIAL TRANSPARENCY Financial Highlights – H1 2014/15 Group revenues decline by 12 % to 3,482 (3,937) million € Operating profit decreased 64 % to 147 (407) million € Cash flow declined 46 % to 247 (454) million € Earnings per share decreased to 0.37 (1.21) € Net financial debt increased by 146 million € to 422 (276) million € Net financial debt as % of equity increased to 9 (6) % Equity ratio still on high level at 57 (59) % Südzucker Group, page 49 FINANCIAL TRANSPARENCY Segment Sugar: Development H1 2014/15 nd 2 (mn €) Revenues EBITDA EBITDA margin Depreciation Operating profit Operating margin 2014/15 835 38 quarter 2013/14 1.050 159 4,5% 15,2% -15 23 -15 144 2,8% 13,8% st +/- in % -20,5 -76,2 -2,0 -83,8 1 half year 2014/15 2013/14 1.699 2.085 97 333 5,7% 16,0% -29 68 -29 304 4,0% 14,5% +/- in % -18,6 -70,7 -1,4 -77,5 Revenues: Revenues decreased mainly driven by the decline in quota sugar sales revenues. Quota sugar volumes increased. World market prices for non-quota sugar below last year’s level drove export prices down. Operating profit: Decrease primarily due to significantly lower quota sugar sales revenues, especially in Southern and Eastern European markets. Harvest expectations: Beet yield expected to reach 76 (67) t/ha, strongly above five year average. Südzucker Group, page 50 FINANCIAL TRANSPARENCY Segment Special Products: Development H1 2014/15 nd 2 (mn €) Revenues EBITDA EBITDA margin Depreciation Operating profit Operating margin 2014/15 422 38 quarter 2013/14 435 31 9,1% 7,2% -18 20 -18 13 4,7% 3,0% st +/- in % -3,2 22,7 0,0 55,0 1 half year 2014/15 2013/14 855 883 82 70 9,5% 7,9% -37 45 -36 34 5,2% 3,9% +/- in % -3,1 16,3 3,1 30,0 Revenues: Slightly down from last year mainly due to lower sales revenues. Operating profit: Despite lower sales revenues, increase thanks to lower costs and stable volume development. Investments to support future development: Biomass boiler at the site in Pemuco, Chile, to improve energy use Construction of wheat starch factory at the site in Zeitz, Germany Südzucker Group, page 51 FINANCIAL TRANSPARENCY Segment CropEnergies: CropEnergies: Development H1 2014/15 nd 2 (mn €) Revenues EBITDA EBITDA margin Depreciation Operating profit Operating margin 2014/15 181 0 quarter 2013/14 171 19 0,0% 10,9% -9 -9 -8 11 - 6,2% st +/- in % 5,9 -100,0 12,7 - 1 half year 2014/15 2013/14 372 341 14 42 3,6% 12,3% -18 -4 -16 26 - 7,7% +/- in % 9,1 -67,9 12,6 - Revenues: Increase despite significantly lower ethanol sales revenues thanks to considerably higher bioethanol and food/feed volumes, which were largely attributable to Ensus. Operating profit: Lower net raw material costs and higher volumes were not enough to fully offset the sharp drop in ethanol sales revenues. Südzucker Group, page 52 FINANCIAL TRANSPARENCY Segment Fruit: Fruit: Development H1 2014/15 nd 2 (mn €) Revenues EBITDA EBITDA margin Depreciation Operating profit Operating margin 2014/15 271 26 quarter 2013/14 302 28 9,7% 9,3% -9 17 -9 19 6,2% 6,4% st +/- in % -10,2 -7,1 4,5 -12,4 1 half year 2014/15 2013/14 556 628 56 61 10,1% 9,7% -18 38 -18 43 6,9% 6,9% +/- in % -11,4 -8,0 1,1 -11,8 Revenues: Volumes unchanged in fruit preparations; however, foreign currency effects due to a stronger euro led to decline in revenues. Lower revenues in fruit juice concentrates due to lower volumes as well as lower selling prices for apple juice concentrate. Operating profit: Lower profit, but stable operating margin for fruit preparations and fruit juice concentrates, which confirms that the measures to cut material and structural costs have been successfully implemented. Restructuring: Closing of fruit preparation line in Kröllendorf and focus on production site Gleisdorf. Südzucker Group, page 53 FINANCIAL TRANSPARENCY Income statement (I) nd 2 (mn €) Rev enues Operating profit Restructuring costs/special items Income from companies consolidated at equity Inc ome from operati ons Financial result Earni ngs before i nc ome taxes 2014/15 1.709 51 7 9 67 -22 54 quarter 2013/14 1.958 187 -3 15 199 -29 185 st +/- in % - 12,7 -72,6 -37,7 - 66,6 -24,1 - 71,0 2014/15 3.482 147 7 19 173 -21 152 1 half year 2013/14 3.937 407 -1 26 432 -29 403 +/- in % - 11,6 -63,9 -26,8 - 60,0 -27,6 - 62,2 Income from companies consolidated at equity: Income from companies consolidated at equity were 19 (26) million €. Sugar segment’s result of 5 (12) million € relates mainly to its share of earnings from ED&F Man, Studen Group and a joint-venture distribution company. Special products segment's result of 14 (14) million € includes its earnings share from Hungrana Group's starch business. Financial result: Financial result improved to -21 (-29) million €. Average debt slightly higher than the year prior and net interest expense of -21 (-20) million €. Other financing was 0 (-9) million €. The year prior this item included currency exchange losses attributable to the financing of subsidiaries in Eastern Europe, as well as South and Central America. Südzucker Group, page 54 FINANCIAL TRANSPARENCY Income statement (II) nd 2 (mn €) Earni ngs before i nc ome taxes Taxes on income N et earnings f or the year of which attributable to Südzucker AG shareholders of which attributable to hybrid capital of which attributable to minority interests Earni ngs per s hare (€) st 2014/15 54 -12 42 26 7 9 quarter 2013/14 185 -41 144 115 7 22 +/- in % - 71,0 -72,1 - 70,7 -77,2 0,0 -57,5 0,13 0,57 - 77,2 2014/15 152 -33 119 75 13 31 1 half year 2013/14 403 -91 312 247 13 52 +/- in % - 62,2 -63,7 - 61,8 -69,6 0,0 -40,5 0,37 1,21 - 69,4 Taxes on income: Tax rate was 22 % (23) %. Minority interests: The co-owners of AGRANA and CropEnergies account for most of the other minority interests‘ share of net earnings. Earnings per share (EPS): Decreased to 0.37 € (1.21 €). Südzucker Group, page 55 FINANCIAL TRANSPARENCY Cash flow statement nd (mn €) Cas h fl ow Inc reas e (- )/ Dec reas e (+) in worki ng c api tal Inves tments in fixed as s ets Sugar segment Special products segment CropEnergies segment Fruit segment Total inves tments in fi xed as s ets Inves tments in financ i al as s ets /ac qui s itions Total inves tments Inc reas es i n s takes hel d i n s ubs idiaries Capi tal inc reas e/dec reas e Divi dends paid st 2014/15 94 quarter 2013/14 204 +/- in % - 53,8 430 490 - 12,1 237 156 52,5 52 30 9 11 102 62 28 4 9 103 -15,0 6,4 > 100 14,9 - 1,5 81 55 11 21 168 95 49 7 15 166 -15,9 13,8 62,9 39,6 1,1 0 102 0 103 - 1,0 0 168 0 166 - 100,0 1,0 0 0 0 0 - 100,0 30 0 0 0 - 100,0 - 168 - 260 - 35,3 - 172 - 260 - 34,0 2 1 half year 2014/15 2013/14 247 454 +/- in % - 45,7 Cash flow: Cash flow mainly tracked EBIT and came in below the previous year’s level. Working Capital: Cash flow from working capital resulted mainly from a reduction in inventories during the first half of the fiscal year, during which time it was higher than liability payments to beet farmers. Investments: Sugar: Mainly replacement spending and investments to improve energy efficiency. Special products: Primarily due to the construction of starch factory in Zeitz and biomass boiler at the BENEO site, Chile. CropEnergies: Optimization of production systems. Fruit: Mainly in the fruit preparations area. Südzucker Group, page 56 FINANCIAL TRANSPARENCY Balance sheet (mn €) As s ets Non-current assets Current assets Total as s ets Liabilities and s hareholders ' equity Shareholders' equity Non-current liabilities Current liabilities Total liabilities and s hareholders ' equity Net financial debt Equity ratio Net financial debt in percent of equity (gearing) 31.08.2014 31.08.2013 +/- in % 4.525 3.398 7.923 4.419 3.612 8.031 2,4 -5,9 - 1,3 4.547 1.741 1.635 7.923 422 57% 9% 4.768 1.741 1.522 8.031 276 59% 6% -4,6 0,0 7,5 - 1,3 52,8 Current assets: assets: Decline of 214 million €. Main reason is the price and volume-driven reduction in inventories, especially in the sugar segment. In addition, trade receivables were lower due to weaker prices. Net financial debt: debt: Net financial debt rose 146 million € to 422 (276) million €. The ratio of net financial debt to equity was 9 (6) %. Südzucker Group, page 57 FINANCIAL TRANSPARENCY Agenda 1. Overview and strategic objectives page 4 2. Financing page 11 3. Development of Segments Sugar page 16 Special Products page 30 CropEnergies page 38 Fruit page 43 4. Financial Highlights Q1 2014/15 page 48 5. Outlook 2014/15 page 59 6. Appendix Long-term development and key figures page 69 Additional information page 79 Südzucker Group, page 58 FINANCIAL TRANSPARENCY Bridge (I) – Income statement figures adjusted mn € Revenues accounting changes due to IFRS 11 2013/14 Affected joint ventures figures presented 2013/14 7.533 -202 7.735 889 -44 933 -267 8 -275 622 -36 658 -116 0 -116 48 48 --- 554 12 543 Income from companies consolidated at equity --- -20 20 Financial result -60 1 -61 Earnings before income taxes 494 -8 502 -105 8 -112 390 0 390 EBITDA Depreciation Operating profit Result from restructuring and special items Income from companies consolidated at equity Income from operations Taxes on income Net earnings Südzucker Group, page 59 Studen (Segment sugar) Hungrana (Segment special products) CT Biocarbonic (Segment CropEnergies) At-equity instead of pro-rata consolidation since 01.03.2014 FINANCIAL TRANSPARENCY Bridge IFRS (II) – Segment data figures adjusted Group Revenues Operating profit 7.533 622 -202 -36 7.735 658 Sugar Revenues Operating profit 3.901 436 -60 0 3.961 436 Special P. 2013/14 Revenues Operating profit 1.740 85 -142 -37 1.882 122 CropEn. 2013/14 figures presented Revenues Operating profit 720 36 0 1 720 35 Fruit mn € accounting changes due to IFRS 11 Revenues Operating profit 1.172 65 0 0 1.172 65 Südzucker Group, page 60 FINANCIAL TRANSPARENCY Outlook 2014/15 (I) Revenues 2013/14* 2014/15e Operating Profit 2013/14* 2014/15e ~30 to 70 mn € Sugar 3.9 bn € 438 mn € Special Products 1.7 bn € 85 mn € CropEnergies 720 mn € Fruit 1.2 bn € 65 mn € Group 7.5 bn € ~ 7.0 bn € 622 mn € * IFRS 11 adjusted Südzucker Group, page 61 >750 mn € 35 mn € -20 to 0 mn € ~ 200 mn € FINANCIAL TRANSPARENCY Outlook 2014/15 (II) 2013/14* 212/13e 2014/15e EBITDA 889 mn € ~ 500 mn € Investments Fixed Assets 377 mn € ~ 450-500 mn € 22 mn € - Investments Finan. Finan. Assets StepStep-up subsidiaries RoCE * IFRS 11 adjusted, RoCE unadjusted 11.0% ** Purchase Agrana bioethanol minorities Südzucker Group, page 62 193 mn € 10.6 % ~ 30 mn € ** FINANCIAL TRANSPARENCY Outlook 2014/15 (III) 2013/14* 212/13e 2014/15e Net Financial Debt 536 mn € ~ 650-750 mn € Cash flow 697 mn € >450 mn € 9.3 % >6.5 % Cash flow / Revenues Equity ratio * IFRS 11 adjusted Südzucker Group, page 63 53.8 % ~ 53 % FINANCIAL TRANSPARENCY Summary (I): Financial year 2014/15 Burden mainly from temporary difficult market environment in sugar and ethanol markets lead to significant operating profit decrease on group level Due to sugar segment development, group operating profit target of ~ 200 million € more ambitious Peak in capex level secures future development New starch and neutral alcohol plants to enlarge Zeitz site Biomass boiler, Chile Launch of fourth fruit preparations plant to enforce market presence in USA Ongoing very solid balance sheet figures Comfortable liquidity position Südzucker Group, page 64 FINANCIAL TRANSPARENCY Summary (II): Midterm Outlook Financial year 2015/16 is going to be another difficult year for the sugar business, but segments special products, CropEnergies and fruit to show earnings improvements We stick to our midterm guidance Group operating profit: ~ 550 million € o/w sugar ~ 250 million € Group EBITDA: ~ 850 million € Capex to match depreciation level Südzucker Group, page 65 FINANCIAL TRANSPARENCY Mid term Outlook (I) (I) – Group Operating Profit Fruit Crop Energies Special Products Sugar ~ 200 mn € 2014/15 Launch USA Volume growth parallel to market growth ~ 550 mn € Ensus: Utilization and efficiency gains Normalisation ethanol pricing Utilization Pischelsdorf Launch Zeitz Biomass boiler Chile Recovery wm price Market equilibrium Cost savings Mid term Megatrends intact (population growth, increase in per-capita income ...) Südzucker Group, page 66 FINANCIAL TRANSPARENCY Mid term Outlook (II) – Group EBITDA and Capex ~ 450 – 500 mn € ~ 850 mn € Room for manoeuvre Growth ~ 500 mn € MainMaintenance ~250 mn € MainMaintenance Capex EBITDA 2014/15 Südzucker Group, page 67 Capex EBITDA mid term FINANCIAL TRANSPARENCY Agenda 1. Overview and strategic objectives page 4 2. Financing page 11 3. Development of Segments Sugar page 16 Special Products page 30 CropEnergies page 38 Fruit page 43 4. Financial Highlights Q1 2014/15 page 48 5. Outlook 2014/15 page 59 6. Appendix Long-term development and key figures page 69 Additional information page 79 Südzucker Group, page 68 FINANCIAL TRANSPARENCY LongLong-term development (I) Pre-Reform Transition Period Post-Transition Period Actual 2004/05 Actual 2005/06 Actual 2006/07 Actual 2007/08 Actual 2008/09 Actual 2009/10 Actual 2010/11 Actual 2011/12 Actual 2012/13 4.827 724 5.347 669 5.765 682 5.780 489 5.871 489 5.718 645 6.161 775 6.992 1.015 7.879 1.246 7.533 889 EBITDA-Margin 15,0% 12,5% 11,8% 8,5% 8,3% 11,3% 12,6% 14,5% 15,8% 11,8% Operating profit 523 450 419 233 258 403 521 751 972 622 10,8% 8,4% 7,3% 4,0% 4,4% 7,0% 8,5% 10,7% 12,3% 8,3% 491 457 358 297 397 328 305 242 -129** -227 -246 -326 189 120 100 19 345 232 183 162 392 348 276 200 513 443 346 252 759 660 515 377 955 866 734 592 554 494 390 282 Market capitalization Closing price on February 28/29 Earnings per share (€) Dividend per share (€) 2.828 16,18 1,67 0,55 4.206 22,21 1,36 0,55 3.024 15,97 -1,72 0,55 2.746 14,50 0,10 0,40 2.587 13,66 0,86 0,40 3.230 17,06 1,06 0,45 3.768 19,90 1,33 0,55 4.117 21,75 1,99 0,70 6.850 33,55 3,08 0,90 4.114 20,15 1,38 0,50 Cash flow Investments total 550 1.090 527 642 554 599 498 550 504 424 553 233 606 251 823 286 996 521 697 399 Capital Employed RoCE 4.646 11,3% 5.221 8,6% 4.767 8,8% 5.005 4,7% 4.923 5,2% 5.374 7,5% 5.314 9,8% 5.707 13,2% 5.950 16,3% 5.874 10,6% Total Assets Equity Equity Ratio Net Financial Debt (NFD) Gearing (NFD/Equity) 7.195 2.738 38,1% 1.672 61,1% 7.926 3.733 47,1% 1.177 31,5% 7.932 3.362 42,4% 811 24,1% 7.917 3.299 41,7% 1.508 45,7% 7.709 3.230 41,9% 1.632 50,5% 7.398 3.443 46,5% 1.065 30,9% 7.260 3.687 50,8% 854 23,2% 8.289 3.969 47,9% 791 19,9% 8.806 4.731 53,7% 464 9,8% 8.665 4.663 53,8% 536 11,5% (mn €) Revenues EBITDA Operating Margin Income from operations (EBIT) Earnings before income taxes (EBT) Net earnings thereof to SZ AG shareholders * IFRS 11 adjusted ** Extraordinary impact from Goodwill impairment loss. *** Capex (excluding investments in financial assets). Südzucker Group, page 69 Actual 2013/14* Outlook 2014/15e ~ 7,000 ~ 500 ~ 200 > 450 *** ~ 450 - 500 ~ 53% ~ 650 - 750 FINANCIAL TRANSPARENCY LongLong-term development (II) Cash flow (mn €) Revenues (bn € ) 996 823 527 554 498 504 553 7.9 7.0 697* 606 5.8 5.3 Operating Profit (mn € ) 972 751 1,065 854 811 791 464 2.2x ~7.0 6.2 1,632 1,177 NFD/CF 5.7 > 450 Net Financial Debt (mn € ) 1,508 5.8 5.9 1.5x 3.0x * IFRS 11 adjusted Südzucker Group, page 70 3.2x 7.5* 1.9x 1.4x 1.0x 0.5x ~650-750 536* 450 622* 521 419 403 233 258 ~200 0.8x Sugar Special Products CropEnergies Fruit FINANCIAL TRANSPARENCY Group Segments Return on Capital Employed (RoCE) RoCE) 2009/10 2010/11 2011/12 2012/13 2013/14* Sugar 7.5% 10.4% 17.1% 22.4% 13.7% Special Prod. Prod. 10.5% 10.8% 10.7% 9.5% 6.3% CropEnergies 2.3% 8.7% 10.2% 17.3% 6.4% Fruit 5.5% 6.7% 4.7% 5.0% 8.1% RoCE 7.5% 9.8% 13.2% 16.3% 10.6% Operating Profit 403 mn € 521 mn € 751 mn € 972 mn € 622 mn € Capital Employed 2014/15 e ~200 mn € 5,374 mn € 5,314 mn € 5,707 mn € 5,950 mn € 5,874 mn € * IFRS 11 adjusted; 2013/14 unadjusted: Group 11.0%, sugar 13.6%, special products 8.7%, CropEnergies 6,3%, fruit 8.1% Südzucker Group, page 71 FINANCIAL TRANSPARENCY Breakdown of Capital Employed (2013/14)* Breakdown by assets Breakdown by segments 14% 21% 9% 46% 5,874 mn € 5,874 mn € 23% 33% Goodwill * IFRS 11 adjusted Südzucker Group, page 72 Working Capital 54% Fixed assets Sugar Special Products CropEnergies Fruit FINANCIAL TRANSPARENCY Südzucker with strong capital market presence Südzucker Bonds Südzucker Share 36% 10% 7% 52% Financial liabilities* liabilities* 204.2 mn shares 38% 57% Liabilities to banks ( mn €) €) Bond 2011/18 Hybrid bond 2005/15 Due date Others SZVG Bonds Coupon Nominal value Zucker Invest GmbH Free Float Key figures as of 31 August 2014 29.03.2018 4,125% 400,0 Market capitalization: ~ 2.77 bn € (MDAX rank 28) ** 5,25% 700,0 Free-float market cap.: ~ 1.05 bn € (MDAX rank 43) Cum. share-turnover (12 months): 3.7 bn € (rank 5) * as of February 28, 2014 incl. hybrid bond ** first issuer call right by Südzucker as of 30 June 2015 Südzucker Group, page 73 ∅-trading volume/day (12 months): ~1.8 mn shares FINANCIAL TRANSPARENCY Financing maturity profile (as of August 31, 2014) April 2014 (in Q1 2014/15 redeemed) redeemed) June 2019 +1 +1 Nov 2018 +1+1 5.90% Südzucker promissory note, 45 mn € Syndicated loan AGRANA, 300 mn €, Margin 90 bp, short-term borrowing facility 1-6 months Syndicated loan, 600 mn €, Margin 50 bp at Baa2/BBB, short-term borrowing facility 1 month < 1 year April 2017/19/22 Agrana promissory note, 110 mn € March 2018 4.125% Bond 2011/2018, 400 mn € 5.25% Hybrid Bond 2005/perpetual, 700 mn € Perpetual Perpetual Südzucker Group, page 74 Issuer call June 30 June 2015 at the earliest. Pursuant to § 6 (5) and (6) of bond documentation the exercise of the call right is subject to having issued, within the twelve month preceding the redemption becoming effective, replacement capital (parity and/or junior securities and/or shares) against issue proceeds at least equal to the amounts payable upon redemption. Commercial Paper-Program, perpetual, 600 mn € Drawn lines: 200 mn € FINANCIAL TRANSPARENCY Liquidity profile end of period* period* Q2 2014/15 Q1 2014/15 Q4 2013/14 Q3 2013/14 Q2 2013/14 - 422 - 670 - 536 - 63 - 276 788 729 648 988 791 - 1.209 - 1.399 - 1.183 - 1.052 - 1.067 Long- t erm financ ial debt - 671 - 674 - 681 - 682 - 748 Short- t erm financ ial debt - 538 - 725 - 502 - 369 - 319 692 735 759 805 837 (mn €) N et financ ial debt Cas h & Cas h equivalents / s ec urities Gros s financ ial debt Bank c redit lines undrawn Syndic ated loan undrawn Syndic ated loan Agrana undrawn Commerc ial paper program undrawn Bank c redit lines (undrawn) + + + = Cas h & cash equivalents / securities Syndic ated loan (undrawn) Commercial paper (undrawn) Total liquidity reserv es * IFRS 11 adjusted Südzucker Group, page 75 268 293 313 369 391 600 600 600 600 600 600 600 600 600 600 450 450 450 450 450 387 333 373 391 389 600 600 600 600 600 400 278 510 600 600 268 788 987 400 293 729 933 278 314 648 973 510 370 988 991 600 391 791 989 600 2.443 2.232 2.444 2.949 2.772 FINANCIAL TRANSPARENCY Group balance sheet (mn€ mn €) Assets 28.02.2014 * 28.02.2013 1,924 (21.8 % ) 2,568 Other current assets Inventories (29.2 % ) 4,314 (49.0 % ) 8,806 * IFRS 11 adjusted Südzucker Group, page 76 Liabilities Non-current assets Total 28.02.2014 * 28.02.2013 1,897 2,292 (21.9 %) (26.0 % ) 2,360 1,783 (27.2 %) (20.3 % ) 4,408 4,731 (50.9 %) (53.7 % ) 8,665 8,806 Current liabilities 2,384 (27.5 % ) Non-current liabilities Equity Total 1,618 (18.7 % ) 4,663 (53.8 % ) 8,665 FINANCIAL TRANSPARENCY Group balance sheet (mn €) 28.02.2014* 28.02.2013 Intangible assets 1.189 Fixed assets 2.656 Shares in companies consolidated at equity 285 Other investments and loans 24 Securities 105 Receivables and other assets 28 Deferred tax assets 123 Non-current assets 4.408 13,7% 30,7% 3,3% 0,3% 1,2% 0,3% 1,4% 50,9% 1.189 2.633 190 30 106 44 122 4.314 13,5% 29,9% 2,2% 0,3% 1,2% 0,5% 1,4% 49,0% Inventories Trade receivables and other assets Current tax receivables Securities Cash and cash equivalents Current assets 2.360 1.290 64 41 502 4.256 27,2% 14,9% 0,7% 0,5% 5,8% 49,1% 2.568 1.307 91 42 484 4.492 29,2% 14,8% 1,0% 0,5% 5,5% 51,0% Total assets 8.665 100,0% * IFRS 11 adjusted Südzucker Group, page 77 8.806 100,0% (mn €) 28.02.2014 * 28.02.2013 Equity attributable to shareholders of SZ AG 3.305 Hybrid capital 684 Other minority interest 674 Shareholder's equity 4.663 38,1% 7,9% 7,8% 53,4% 3.264 684 783 4.731 37,1% 7,8% 8,9% 53,7% Provisions for pensions and similar obligations 658 Other provisions 82 Non-current financial liabilities 681 Other liabilities 18 Tax liabilities 75 Deferred tax liabilities 104 Non-current liabilities 1.618 7,6% 0,9% 7,9% 0,2% 0,9% 1,2% 18,7% 688 87 808 16 94 89 1.783 7,8% 1,0% 9,2% 0,2% 1,1% 1,0% 20,2% Other provisions Current financial liabilities Trade payables and other liabilities Current tax liabilities Current liabilities 2,2% 5,8% 18,6% 1,0% 27,5% 189 287 1.730 87 2.292 2,1% 3,3% 19,6% 1,0% 26,0% 190 502 1.610 83 2.384 Total liabilities and shareholders' equity 8.665 100,0% 8.806 100,0% FINANCIAL TRANSPARENCY Agenda 1. Overview and strategic objectives page 4 2. Financing page 11 3. Development of Segments Sugar page 16 Special Products page 30 CropEnergies page 38 Fruit page 43 4. Financial Highlights Q1 2014/15 page 48 5. Outlook 2014/15 page 59 6. Appendix Long-term development and key figures page 69 Additional information page 79 Südzucker Group, page 78 FINANCIAL TRANSPARENCY Revenue by region 2013/14* Germany (26 %) Rest of world (16 %) 7,735 mn € EU 13 (14 %) * IFRS 11 adjusted Südzucker Group, page 79 EU 15 (44 %) FINANCIAL TRANSPARENCY Segment Sugar: Campaign SMY 2013/14 Beet growers 42,100 (42,600) Beet acreage: 396,000 (422,000) ha Sugar factories (incl. refineries): 32 (32) Beet processing: 27.2 (28.7) mn tons Sugar production: 4.7 (4.9) mn tons thereof from beets: 4.3 (4.5) mn tons thereof raw sugar raffination: 0.5 (0.4) mn tons Südzucker Group, page 80 FINANCIAL TRANSPARENCY Südzucker well positioned in „Beet Belt“ Poland Germany Belgium Czech Republic Slovakia France Austria Hungary Südzucker Group, page 81 Moldova Romania FINANCIAL TRANSPARENCY 700 600 600 500 500 White sugar contract No. 5 LIFFE London (Future contract switching upon expiry) Raw sugar contract No. 11 NYMEX New York (Future contract switching upon expiry) Südzucker Group, page 82 Feb-14 Sep-14 Jul-14 May-14 Mar-14 Jan-14 Nov-13 Sep-13 100 Jul-13 100 May-13 200 Mar-13 200 Feb-13 300 Feb-12 300 400 Feb-11 400 Feb-10 Quotation for sugar in € / ton 700 Jan-13 Quo tation for s ugar in € / t on Price development for raw and white sugar (NYMEX, LIFFE, EU) FINANCIAL TRANSPARENCY EU: Production and consumption of bioethanol Production Consumption 2013e: 6.6 million m3 (+0%) 2013e: 7.9 million m3 (-3.0%) Fuel: 4.6 million m3 (+0.9%) Production increase e. g. in Germany, Poland, Spain, the UK and Hungary Fuel: 5.5 million m3 (-4.3%) EU-wide decrease of fuel ethanol with the exception of the UK (+5.8%) E10 continues to be only available in Germany, Finland and France 2014e: 6.8 million m3 (+3.3%) 2014e: 7.8 million m3 (-1.6%) Production of bioethanol 0.8 Production and consumption of fuel ethanol 2,000 Alcohol for traditional applications Bioethanol for fuel application 1,500 (in 1,000 m3) 0.4 2012 2013 1,000 ,500 2009 2010 2011 2012 2013e 2014e Source: F.O.Licht Südzucker Group, page 83 GER FRA GBR ESP SWE POL Consumption Production Consumption Production Consumption Production Consumption Production Consumption Production Consumption Production 0.0 Consumption ,0 0.2 Production (in million m3) 0.6 Others Source: F.O.Licht FINANCIAL TRANSPARENCY Bioethanol sales in Germany in 2013 Bioethanol consumption in Germany m3 Approx. 86% or 1.3 million bioethanol are directly blended to petrol 150 Blending quota in petrol sector: 4.2% 4.5% 4.0% 4.2% 4.1% 3.9% 3,8% 4,0% 5% 4% 3% 60 2% 30 1% 0 0% EtOH in ETBE Direct blending EtOH in E85 blending rate Source: BAFA E10 sales in Germany and France Slight increase of E10 sales 300 Germany France 250 (in 1,000 t) January to April 2014 further increase by 5.4% to 917,000 tonnes 4.4% 4.1% 90 January to April 2014: Increase of consumption by 0.5% to 470,000 m3 Increase by 5.4% to 2.8 million tonnes despite declining petrol sales 6% 120 (in 1,000 m3) Consumption of fuel ethanol in Germany declines by 3.4% to 1.5 million m3 180 200 150 100 50 0 Source: BAFA, SNPAA Südzucker Group, page 84 FINANCIAL TRANSPARENCY 300 280 280 260 260 240 240 220 220 Wheat price (Future contract switching upon expiry) Price for maize (Future contract switching upon expiry) Südzucker Group, page 85 Feb-14 Feb-13 Sep-14 100 Jul-14 100 May-14 120 Mar-14 120 Jan-14 140 Nov-13 140 Sep-13 160 Jul-13 160 May-13 180 Mar-13 180 Feb-12 200 Feb-11 200 Feb-10 € / ton 300 Jan-13 € / ton Price development wheat and maize (Euronext, LIFFE) FINANCIAL TRANSPARENCY Investor Relations Financial calender Contact 13 January 2015 Q3 – 1st to 3rd quarter report 2014/15 Nikolai Baltruschat Head of Investor Relations Tel.: +49 (621) 421 – 843 [email protected] 21 May 2015 Press and analysts‘ conference fiscal 2014/15 9 July 2015 Q1 – 1st quarter report 2015/16 16 July 2015 Annual general meeting for fiscal 2014/15 8 October 2015 Q2 – 1st half year report 2015/16 13 January 2016 Q3 – 1st to 3rd quarter report 2015/16 Südzucker Group, page 86 Bernhard Juretzek Manager Investor Relations Tel.: +49 (621) 421 – 530 [email protected] Katrin Weber Assistant Tel.: +49 (621) 421 – 240 [email protected] Südzucker AG Mannheim/Ochsenfurt Theodor-Heuss-Anlage 12 68165 Mannheim, Germany [email protected]
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