annual general meeting - zeder - agm 2013 present… · • bio fuels • non-food (i.e. rubber,...

Annual General Meeting

Presented by:

Jannie MoutonChairman

21 June 2013

General matters

• To accept the presentation of the audited

annual financial statements for the year ended

28 February 2013

Ordinary resolutions

• To re-elect the following directors:

– Resolution 1: Jannie Mouton

– Resolution 2: Michiel le Roux– Resolution 2: Michiel le Roux

– Resolution 3: Norman Celliers

– Resolution 4: Antonie Jacobs

3

Ordinary resolutions

• To re-appoint the following members to the

audit and risk committee:

– Resolution 5: Michiel le Roux– Resolution 5: Michiel le Roux

– Resolution 6: George Eksteen

– Resolution 7: Lambert Retief

4

Ordinary resolutions

• Resolution 8:

To re-appoint PwC as the auditor

5

Ordinary resolutions

• Resolution 9:

General authority to issue ordinary shares for cash

6

Special resolutions

• Special resolution 1:

Inter-company financing

• Special resolution 2: • Special resolution 2:

Financial assistance for the acquisition of shares in a

related or inter-related company

7

Special resolutions

• Special resolution 3:

Share buy-back by Zeder and its subsidiaries

• Special resolution 4: • Special resolution 4:

Conversion of authorised and issued share capital to

shares of no par value

8

Special resolutions

• Special resolution 5:

Increase of the authorised ordinary share capital of

the company

• Special resolution 6:

Consequential amendments to the memorandum of

incorporation of the company

9

Investor Presentation

Presented by:

Norman CelliersChief executive officer

21 June 2013

Thank you.Thank you.

• Long term value investor with a primary focus on

Agribusiness, specifically the food and beverage sectors

• Listed on the JSE – ZED - hybrid private equity vehicle

Our business

INTRODUCTION

• Key characteristics of investment considerations: – Growth sectors or subsectors

– Management with proven track record

– High barriers to entry

– Unique and defendable products (brands)

– Simple (easy to understand)

– Scalable business models

– Focused execution

South Africa (Direct)

Historically

Geography: South Africa (Direct)

Going forward

• AgribusinessIndustry: • Agribusiness

• Food and BeveragesSub-sector: • Food and Beverages

• Bio Fuels

• Non-food (i.e. Rubber, timber)

Expanded strategy

INTRODUCTION

• South Africa (Direct)

• Rest of World (via portfolio)Geography: • South Africa (Direct)

• Sub-Sahara Africa (Direct)

• Rest of World (via portfolio)

• Arbitrage

• UndervaluedCriteria: • Arbitrage

• Undervalued

• Growth sectors

• Consolidation

• PassiveInfluence: • Passive

• Active

Invest in and build the businesses of tomorrow

PERFORMANCE REVIEW

Summary results FY20132012 2013

Sum of the parts

Sum of the parts per share

R3,084m

R3.15

R3,903m

R3.9926.7%

Recurring headline earnings

Recurring headline earnings per share (cents)

R273,0m

27.9

R251,1m

25.77.9%

Headline earnings

Headline earnings per share

R299,9m

30.7

R196,3

20.134.5%

Attributable earnings

Attributable earnings per share

R334,6

34.2

R511,7

52.352.9%

Dividend

Dividend per share

R39m

4.0

R39m

4.0

• Grown from R350m tot R3,9 billion in 6,5 years

• Initially acquired many small portions of undervalued shares (low P/E’s)

PERFORMANCE REVIEW

Growth in portfolio

3,000.00

3,500.00

4,000.00

4,500.00

Other financial instruments

Nett Cash

Chayton

Outspan

Senwes

Pioneer

* End of calendar year 2012

-

500.00

1,000.00

1,500.00

2,000.00

2,500.00

3,000.00

2006 2007 2008 2009 2010 2011 2012 2013

Pioneer

Tuinroete Agri

BKB

OVK

NWK

Suidwes Beleggings

Capespan

Overberg Agri

KLK

Agricol

MGK

KWV Holdings

0

250

500

349277

206

37 17

PERFORMANCE REVIEW

Investments and disposals

R’m

Investments made during FY13: R538m

Investments made since YE: R349m

R887m

-1,000

-750

-500

-250

0

-154

-799

Capespan Chayton ZAAD Kaap Agri AVB Other CVH

Disposals made during FY13: R953m

CVH*: R700m profit / IRR = 19.4% over 6.5 years

* Includes entire shareholding and assumption that remaining 5% is sold at same price

1,000

1,5001,475

R’m

Portfolio weighting

PERFORMANCE REVIEW

-500

0

500

633

369 349 343288 277

224

107 90 54

-301

AVB

Capespan*

Agricol

Cash*

Kaap A

gri

CVH

Chayto

n

NW

K

Overb

erg

Suid

wes

Oth

er

Net

Lia

bilitie

s

* Adjusted for transactions since yearend as published

Portfolio interests

PERFORMANCE REVIEW

• Strong assets

• Leading brands

Corporate and consumer brand exposure

PERFORMANCE REVIEW

• Leading brands

• Good management

• Growth potential

Historical overview

PERFORMANCE REVIEW

285

257

340

274

315

399

300

350

400

450

25

30

35

Recurring headline earnings

(Cents per share)

SOTP & Share price

(Cents per share)TSR = 16.2%

200

260

146

187

262

257

200

225 216

192

211

274

-

50

100

150

200

250

-

5

10

15

20

2006 2007 2008 2009 2010 2011 2012

Dividends per share (cents) Recurring headline earnings per share (cents) Share price (cents) SOTP value per share (cents)

2013

Services and support

Upstream Midstream Downstream

MACRO ENVIRONMENT

Agribusiness focus

Food

InputsPrimary

productionProcessing

Secondary production

Distribution RetailMarketing and sales

Services and support

Beverages

Bio Fuels

Timber, Textiles, Leather, Rubber, Etc

MACRO ENVIRONMENT

Growth themes

2000 2050

MACRO ENVIRONMENT

African population growth

23

MACRO ENVIRONMENT

African demand

Source: FOA, World Bank, United Nations

• Inputs

• Mechanisation

MACRO ENVIRONMENT

Agri-productivity

25

• Irrigation

• Finance

• Technology

• Management

Share priceDPS / HEPS

PORTFOLIO REVIEW

R1,475m

• Influence ~ 30%

• Turnover = R18,6b

• Adjusted HE = R767m

• SA’s 2nd largest food company

• Listed on the JSE

• Earnings under pressure – high commodity cycle

• Significant capacity for recovery and growth

• Phil Roux started on 1 April 2013 (supported by strong team)

• Sideways for 12 months before resuming steady growth

Salient features:

0

1000

2000

3000

4000

5000

6000

7000

8000

0

100

200

300

400

500

600

08 09 10 11 12

Share price

(cents)

DPS / HEPS

(cents)

Recurring Adjusted HEPS Dividends Share price

• Listed on the JSE

• Four key divisions:

- Sasko

- Bokomo

- Ceres

- Agri

• Challenging environment

• Efficiency improvements

• Increasingly looking into Africa

PORTFOLIO REVIEW

R633m

Share price

• Influence = 71.2%

• Turnover = R5.2b

• Adjusted HE = R87m

• Leading fruit exporting and

marketing company

• Underlying performance encouraging

• Presents both challenges and opportunities

• Increased interest from 37.3% to 71.2% since YE

• Johan Dique and team implementing new strategy

Salient features:

0

50

100

150

200

250

300

0

5

10

15

20

25

30

35

08 09 10 11 12*

Share price

(cents)DPS / HEPS

(cents)

Recurring HEPS Dividends Share price

marketing company

• Three key divisions:

- Fruit marketing

- Fruit procurement

- Logistics

• Initial encouraging exposure to

China

• Solid contributions from

Mozambique

PORTFOLIO REVIEW

R343m

• Influence = 57%

• Turnover = R3.2b

• Adjusted HE = R103m

• Agri retail and related trade

company

• Underlying performance strong

• Zeder made voluntary offer to minorities

• Zeder increased interest to >35% since YE

• Sean Walsh and team driving strategy

Salient features:

0

1

2

3

4

5

6

7

8

9

10

0

20

40

60

80

100

120

140

160

08 09 10 11 12

Share price

(cents)

DPS / HEPS

(cents)

Adjusted HEPS Dividends paid Share price

company

• Three key divisions:

- Trade

- Grains

- Finance

• Growing in South Africa and

commencing African expansion

ZAAD Holdings R368m

• Influence = 92%

• Turnover = R610m

- KKSB = R320m

- Agricol = R290m

• Combined HE = R48m

• ZAAD created as holding company for seed investments

• Increased interest in Agricol from 25% to 92%

• Acquired 49% of Klein Karoo Saad Bemarking

• Antonie Jacobs and team driving clear growth strategy

Salient features:

PORTFOLIO REVIEW

Combined HE = R48m

- KKSB = R17m

- Agricol = R31m

• Producer, marketer and

distributor of a wide variety of

agricultural seeds

• Underlying performance strong

• Already doing business in Africa

and evaluating additional

opportunities-

2,000

4,000

6,000

8,000

10,000

12,000

-

200

400

600

800

1,000

1,200

08 09 10 11 12 13*

Share price

(cents)DPS / HEPS

(cents)

HEPS Dividends Share price

PORTFOLIO REVIEW

R276m

• Acquired 73.4% during 2012 / Partnership with Norfund

• Start-up company in rapid development phase

• Initial results within expectations

• Current focus to drive existing investments to scale

• Willem Meyer, Stuart Kearns, Phil Nicol

• Holding company for grain

related production operations in

Sub Saharan Africa

• Currently invested in two

farming operations in Zambia

• Increased irrigated hectares from

Salient features:

0

2,000

4,000

6,000

4169

2011

Mkushi 420

420

2012

Mkushi

1,572

Somawhe

2,597

4,169

2013

Mkushi

1,572

Somawhe

3,197

4,769

2014

Mkushi

1,572

Somawhe3,797

5,369

2015

Mkushi

1,572

Somawhe4,397

5,969

Irri

ga

ted

he

cta

res

• Willem Meyer, Stuart Kearns, Phil Nicol • Increased irrigated hectares from

420 to 4,169 in less than 18

months through development

and acquisitions

• Double cropping (wheat and

soya) for local demand

• Management teams/directors at portfolio companies

• Zeder directors and team

• PSG Group

Appreciation

CONCLUSION

• PSG Group

• Shareholders

• Stakeholders / Professional partners