interim results presentation - astral foods centre/2020/interim-results...interim results...
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Interim Results Presentation for the 6 months ended 31 March 2020
2
Business Overview Slide 3 – Chris Schutte
Operational Overview Slide 8 – Andy Crocker, Gary Arnold
Industry Matters Slide 26 – Gary Arnold
Financial Overview Slide 29 – Daan Ferreira
Outlook Slide 40 – Chris Schutte
Additional Information Slide 44
2
AGENDA
5/17/2020
BUSINESS OVERVIEW
Chris Schutte Chief Executive Officer
5/17/2020
SALIENT POINTS
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
4
Feed input costs increased over the period on higher maize prices,
following poor yields and a smaller crop for 2019
Poultry production efficiencies on farm were maintained in line with
performance forecasts
Poultry selling prices increased for the period under review, leading
to a partial recovery of higher input costs
Extraordinary costs linked to load shedding, the legislated national
minimum wage and the on-going Standerton water supply contingency
COVID-19 costs late March; on-going impact into 2H2020 under the
nationwide lockdown complying with health and safety requirements
Good start to the 2020 maize planting season with production
prospects for the crop exceeding 15 million tons (2019: 11.3 mmt)
5/17/2020
KEY FINANCIAL INDICATORS
5
Revenue
Profit before interest and tax @ R546 million
Profit for the period @ R371 million
Headline earnings per share @ 951 cps
No interim dividend declared
8.5%
4.3%
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
6
DIVISIONAL OVERVIEW
Poultry
Feeding cost increased
Bird performance improvement
Broiler sales volumes down
Broiler sales realisations up
Extraordinary cost impacts
Feed
Raw material costs up
Less internal feed required
External sales volumes up
Expenses well controlled
Improved Rand per ton margin
Other Africa
Higher profits from the Mozambique operations
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
503 546
250
300
350
400
450
500
550
600
650
700
PB
IT H
1 F
20
19
Ra
w m
ate
ria
l c
os
t
Fee
d c
on
ve
rsio
ne
ffic
ien
cy
Bro
ile
r s
ale
sv
olu
me
s
Bro
ile
r s
ellin
gp
ric
es
Ex
tra
ord
inary
co
sts O
ther
PB
IT H
1 F
20
20
7
THE PERIOD IN PERSPECTIVE
(R million)
R43 million
77
20 15
241
109
17
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
Andy Crocker Managing Director: Commercial
5/17/2020
9
FEED DIVISION
Operating profit - R million
Operating profit up 1.7%
• Net margin 6.9% 1H2019: 7.2%
• Expenses well controlled
• Rand per ton margin up
Revenue - R million
Revenue up 6.2%
• Raw material costs up
• Average selling prices up 6.8%
• Sales volumes down 0.5%
3 303 3 509
-
1 000
2 000
3 000
4 000
1H2019 1H2020
239 243
-
50
100
150
200
250
1H2019 1H2020
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
10
FEED DIVISION
SAFEX yellow maize prices increased for the period under review 1H2020
avg. R2 703 per ton (1H2019: R2 579) up R124 per ton y-o-y
Internal feed sales volumes decreased marginally by 1.2% due to
improved broiler feed conversion rates
External feed sales volumes increased by 0.5% predominantly in the dairy
market despite the higher feed prices
Expenses were well controlled across the division for the period under
review
The average net margin increased (on a Rand per ton basis) for the period
under review
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
11
FEED DIVISION – SALES MIX
59%
5%
21%
15%
59%
5%
22%
14%
1H2019
697 569 Tons
1H2020
694 083 Tons Volume decrease ≈ 0.5%
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
12
SAFEX YELLOW MAIZE PRICE
Source: CJA Strategic Risk Brokers
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
13
SAFEX YELLOW MAIZE PRICE vs. CBOT IN RAND TERMS
Source: CJA Strategic Risk Brokers
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
14
DURBAN SOYA MEAL PRICE
Source: CJA Strategic Risk Brokers
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
Commercial 5/17/2020
16
POULTRY DIVISION - CONSOLIDATED
Operating profit - R million
Operating profit up 11.5%
• Broiler feed price up 6.0%
• Net margin 5.1% 1H2019: 4.7%
Revenue - R million
Total revenue up 3.1%
• Broiler sales volumes down 2.5%
• Broiler sales realisations up 5.5%
• Breeder revenue up R44 million
5 472 5 644
-
1 000
2 000
3 000
4 000
5 000
6 000
1H2019 1H2020
258
287
-
50
100
150
200
250
300
1H2019 1H2020
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
17
POULTRY DIVISION - COMMERCIAL
Profits increased for the period under review
Broiler selling prices increased with less promotional activity relative to the
comparable period
Broiler slaughter numbers at an average of 5.2 million birds per week were
marginally up by 2.3% year-on-year
Broiler sales volumes down due to a change in the point of recognition of a
sale with the new third party distribution agreement, which is based on a
consignment stock model
Overhead expenses increased over the comparable period with the
legislated national minimum wage (not included in 1Q2019), exacerbated by
the impact of load shedding nationally and on-going water supply costs in
Standerton
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
18
POULTRY DIVISION – PRODUCT MIX
51%
2%
4%
13%
8%
22%
1H2019
228 172 Tons
50%
2%
5% 13%
8%
22%
1H2020
222 437 Tons Volume decrease ≈ 2.5%
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
-30%
-20%
-10%
0%
10%
20%
30%
40%
Oc
t-1
4
Dec-1
4
Feb
-15
Ap
r-1
5
Ju
n-1
5
Au
g-1
5
Oc
t-1
5
De
c-1
5
Feb
-16
Ap
r-1
6
Ju
n-1
6
Au
g-1
6
Oc
t-1
6
De
c-1
6
Feb
-17
Ap
r-1
7
Ju
n-1
7
Au
g-1
7
Oc
t-1
7
De
c-1
7
Feb
-18
Ap
r-1
8
Ju
n-1
8
Au
g-1
8
Oc
t-1
8
De
c-1
8
Feb
-19
Ap
r-1
9
Ju
n-1
9
Au
g-1
9
Oc
t-1
9
De
c-1
9
Feb
-20
% Change in broiler feed price % Change in broiler selling price
19
CHANGE IN BROILER SELLING PRICE vs. FEED PRICE
Source: Own Data
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
Agriculture
Gary Arnold Managing Director: Agriculture
5/17/2020
21
POULTRY DIVISION - AGRICULTURE
Parent stock sales were higher for the period under review as demand for
the Ross genetics increased
Parent breeder productions were good, with an improvement in the
number of chicks per hen housed
Demand for hatching eggs decreased as export markets came under
pressure
Feed input costs increased due to higher raw material costs adversely
affecting the live bird production cost
Further improvements in on-farm broiler production efficiencies,
assisted broiler live cost through an improved feed conversion rate
Highly pathogenic bird flu still prevalent in wild birds and ostriches,
however no confirmed cases in commercial poultry since May 2018
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
94%
96%
98%
100%
102%
104%
106%
108%
F2015 F2016 F2017 F2018 F2019 1H2020
Slaughter age Live weight Average daily gain
22
BROILER PRODUCTION PERFORMANCE
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
Key indicators base-lined to 100% in F2015
5/17/2020
80%
85%
90%
95%
100%
105%
110%
115%
120%
125%
F2015 F2016 F2017 F2018 F2019 1H2020
Mortality Feed consumption Performance efficiency factor
23
BROILER PRODUCTION PERFORMANCE
Key indicators base-lined to 100% in F2015
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
5/17/2020
25
OTHER AFRICA DIVISION (Zambia, Mozambique & Swaziland)
Operating profit - R million
Operating profit up 131.9%
• Net margin 6.6% 1H2019: 3.0%
• Mozambique provision for
non-recovery of various taxes
in 1H2019
Revenue - R million
Revenue up 7.0%
• Sales volumes down 4.0%
• Average selling prices up 11.5%
223
239
-
50
100
150
200
250
1H2019 1H2020
7
16
-
5
10
15
20
1H2019 1H2020
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
INDUSTRY MATTERS 5/17/2020
27
POULTRY IMPORTS PER MONTH
Tons
Source: South African Poultry Association
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
0
5000
10000
15000
20000
25000
30000
35000
40000
45000
50000
55000
60000
65000
70000
Oc
t-1
4
De
c-1
4
Feb
-15
Ap
r-1
5
Ju
n-1
5
Au
g-1
5
Oc
t-1
5
De
c-1
5
Feb
-16
Ap
r-1
6
Ju
n-1
6
Au
g-1
6
Oc
t-1
6
De
c-1
6
Feb
-17
Ap
r-1
7
Ju
n-1
7
Au
g-1
7
Oc
t-1
7
De
c-1
7
Feb
-18
Ap
r-1
8
Ju
n-1
8
Au
g-1
8
Oc
t-1
8
De
c-1
8
Feb
-19
Ap
r-1
9
Ju
n-1
9
Au
g-1
9
Oc
t-1
9
De
c-1
9
Feb
-20
Total poultry imports 6 per. Mov. Avg. (Total poultry imports)
5/17/2020
28
Based on industry statistics current broiler slaughter numbers are an average
of 19.6 million birds per week
For the period under review the industry has remained stable with no
consolidation or divestment
Imports during the period averaged 42 907 tons per month (1H2019: 41 774
tons), equalling approximately 30% of total consumption
An increase in the ad valorem import tariff on bone-in and boneless cuts of
chicken was announced on the 13th March 2020
The tariff on frozen bone-in chicken portions and boneless chicken cuts
increased from 37% to 62% and 12% to 42% respectively
The establishment of an oversight committee with representation from
government and all stakeholders will lend support to the implementation of the
Poultry Sector Master Plan
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
INDUSTRY OVERVIEW
5/17/2020
FINANCIAL OVERVIEW
Daan Ferreira Chief Financial Officer
5/17/2020
30
Six months ended 31 March
2020
R million
2019
R million
Revenue 7 069 6 775
Operating profit 546 503
Operating profit margin 7.7% 7.4%
Net finance (cost) / income (27) 18
Profit before tax 519 521
Tax (148) (151)
Profit for the period 371 370
Headline earnings 369 368
EPS – Cents 951 948
HEPS – Cents 951 949
4%
8%
% change
INCOME STATEMENT
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
4 700 4 902
5 755 5 511
5 823
6 131
5 795
6 556 6 600 6 379
6 775 6 710
7 069
213 280
550 551
429
120
212
866
1036
906
503
379
546
1H14 2H14 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20
External revenue Operating profit Operating profit margin %
31
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
GROUP SIX MONTHLY REVENUE AND PROFITABILITY
(R million)
7.7%
5.6%
7.4%
15.7%
14.2%
5/17/2020
2 550
2 956 2 961
3 275 3 461
3 729 3 448 3 405
3 096 3 102 3 303 3 271
3 509
1H14 2H14 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20
Revenue Change in volumes Change in feed price
32
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
FEED SIX MONTHLY REVENUE
(R million)
5/17/2020
3 317 3 650
4 503 4 237 4 436
4 693 4 456
5 394 5 415 5 124
5 472 5 405 5 644
1H14 2H14 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20
Revenue Change in poultry selling price Change in volumes
33
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
POULTRY SIX MONTHLY REVENUE
(R million)
5/17/2020
45 59 351 310 194
-135
22 616 836 617 258 113 287
157 197
186 237
233
252 184
207
191
266
239
250
243
213 280
550 551
429
120 212
875
1044
898
503
379
546
1H14 2H14 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20
Poultry Feed Other Africa Change in feed price Change in broiler selling price
34
GROUP SIX MONTHLY OPERATING PROFIT
(R million)
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
35
March 2020
R million
September 2019
R million
% change
Non-current assets 3 148 2 658
Right of use assets 645 -
Net working capital 1 113 1 288
Current assets (excl. cash) 3 148 2 982
Current liabilities (excl. borrowings / leases) (2 035) (1 694)
Non-current liabilities (excl. leases) (744) (705)
Lease liabilities (664) -
Net assets 3 498 3 241
Net (surplus cash) (470) (555)
Equity 3 968 3 796
Total 3 498 3 241
BALANCE SHEET
14%
6%
20%
6%
8%
8%
5%
18%
15%
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
36
CAPITAL EXPENDITURE
Six months ended 31 March 1H2020
R million
2H2019
R million
1H2019
R million
Depreciation 197 88 88
Property, plant & equipment 91 88 88
Right of use assets 106 - -
Total capex spend 311 312 345
Festive expansion (including advance payments) 249 217 223
Standerton silo upgrade 5 11 30
Other capex 57 84 92
Outstanding commitments 342 537 753
Festive expansion 245 435 651
Standerton silo complex 7 11 22
Other capex 90 91 80
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
37
WORKING CAPITAL
March 2020
R million
September 2019
R million
Variance
R million
Current assets 3 148 2 982 166
Biological assets 801 759 42
Inventory - Poultry 512 337 175
- Feed 428 291 137
- Other Africa 40 63 (23)
Trade receivables 1 225 1 152 73
Advance capex payments - 256 (256)
Other receivables 142 124 18
Current liabilities (2 035) (1 694) (341)
Trade payables (1 491) (1 133) (358)
Other payables (544) (561) 17
Net working capital 1 113 1 288 (175)
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
38
STATEMENT OF CASH FLOWS
Six months ended 31 March 2020
R million
2019
R million
Cash operating profit 715 407
Share based payments (24)
Lease payments (122) -
569 407
Working capital movement (116) 100
453 507
Tax paid (71) (131)
Net interest received 12 21
Capital expenditure (311) (345)
83 52
Dividends paid (165) (409)
Other cash flow items - (1)
Movement in cash equivalents (82) (358)
Effect of exchange rate changes (3) -
Opening balance 555 789
Closing balance 470 431
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
39
Group operating profit up 8.5%
Finance charges up
Change in accounting for leases
No change in earnings for the period
Net impact of lease accounting R(14) million
Net cash outflow of R82 million
Includes dividend paid of R165 million
Capital expenditure of R311 million
Surplus cash at 31 March 2020 of R470 million
No interim dividend declared
Uncertainty around seemingly indefinite lockdown
IN SUMMARY
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
OUTLOOK
Chris Schutte Chief Executive Officer
5/17/2020
41
NEGATIVE INFLUENCES EXACERBATED BY LOCKDOWN
Unprecedented unemployment rate expected following the hard lockdown, and
resultant financial impact on businesses and the economy at large
Consumer disposable income will be severely constrained, with a very slow
recovery out of the lockdown as expected by most economists
Exchange rate effect on input costs, with the Rand pricing of soya and maize
negatively impacted
Higher costs due to COVID-19 with constraints on global supply chains and
price increases of essential inputs
QSR sector shutdown (accounting for 20% of poultry consumed) and late
payments, due to this market sector being impacted during the lockdown
Product mix change resulting in a shift to lower margin products on slower
fresh, value added and QSR sales
Astral’s capacity expansion delayed, due to project commissioning not being
completed as a result of the lockdown
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
42
POSITIVE INFLUENCES
All of Astral’s operations are running like clockwork, and to date no
disruptions have been experienced, with stringent social distancing, screening
and employee welfare measures (sufficient PPE) implemented
Above average maize crop for the 2020 harvest season, should result in
favourable feed costs from August if not further impacted by local currency
weakness
Higher import tariffs on frozen bone-in portions announced in March 2020,
should go some way in levelling the playing fields and discouraging unfair trade
Production efficiency and product mix opportunities when the Festive
expansion is completed
Progressive genetic improvement of the Ross broiler breed will continue to
support the group’s best cost strategy
Business
Overview
Operational
Overview Industry Matters
Financial
Overview Outlook
5/17/2020
“
” Confirmed August 2019
5/17/2020
ADDITIONAL INFORMATION 5/17/2020
45
R million Revenue Expenses Operating
Profit Finance Charges
Inventory Other
Consignment distribution model Recognition of sales (166) (19) 132 Recognition of distribution costs 69 69
Leases – change in accounting Additional amortisation 106 Reallocate lease payments (122) 16 (35) Right-of-use asset 645 Lease liabilities (664)
Service related costs Load shedding 23 (23) Water supply interruptions 13 (13)
COVID-19 related Additional operating expenses 6 (6) Impairment finished goods (15) (15) Increased critical stock holding
Feed 75 Poultry 36
Total (97) 95 (60) (35) 228 (19)
ACCOUNTING CONSIDERATIONS – MARCH 2020
5/17/2020
46
WORLD CORN ENDING STOCKS
Million Tons
19,82%
25,00%
27,80% 26,22% 27,71%
22,87% 24,35%
24,82%
10%
15%
20%
25%
30%
0
25
50
75
100
125
150
175
200
225
250
275
300
325
350
375
2014 2015 2016 2017 2018 2019 2020E 2021F
End Stock Maize stock to use ratio
Source: CJA Strategic Risk Brokers 5/17/2020
47
2014/15 2015/16 2016/17 2017/18 2018/19 2019/20E 2020/21F
Actual Actual Actual Actual Actual Estimate Forecast
Carry In (1 May) 589 2 074 2 471 1 093 3 689 2 662 1 011
Crop Estimate 14 250 9 955 7 779 16 820 12 510 11 275 15 222
Retentions 433 163 309 1 191 495 539 650
Sagis Delivery 13 817 9 794 7 469 15 629 11 984 10 736 14 572
Minus early deliveries 0 0 450 0 0 0 0
Imports 65 1 964 2 237 0 172 510 0
Total Supply 14 471 13 831 11 727 16 722 15 845 13 909 15 583
Domestic Usage Food 4 840 4 698 4 808 4 993 5 161 5 378 5 260
Domestic Usage Feed 5 041 5 520 5 004 5 276 5 508 5 910 6 450
Gristing, withdrawn & released 376 293 278 313 239 189 216
Total Domestic Usage 10 257 10 512 10 090 10 583 10 907 11 477 11 926
Exports & Sundries 2 153 848 993 2 451 2 276 1 421 1 510
Plus early deliveries 0 0 450 0 0 0 0
Carry Out (30 Apr) 2 062 2 471 1 093 3 689 2 662 1 011 2 146
No of days usage 73 86 40 127 89 32 66
STU 16,62% 21,75% 9,87% 28.31% 20,19% 7,84% 15,97%
Marketing year (May to April)
'000 tons
Source: CJA Strategic Risk Brokers
SOUTH AFRICA – TOTAL MAIZE SUPPLY & DEMAND
5/17/2020
2 062
2 471
1 093
3 689
2 662
1 011
2 146
16,62%
21,75%
9,87%
28,31%
20,19%
7,84%
15,97%
0%
5%
10%
15%
20%
25%
30%
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
2014/15 2015/16 2016/17 2017/18 2018/19 2019/20E 2020/21F
Carry out Maize stock to use ratio
48 Source: CJA Strategic Risk Brokers
SOUTH AFRICA – TOTAL MAIZE SUPPLY & DEMAND
‘000 Tons
5/17/2020
49 Source: International Research Institute for Climate and Society (IRI) – Columbia University
EL NIÑO SOUTHERN OSCILLATION - FORECAST
5/17/2020
50 Source: NOAA - National Environmental Satellite, Data, and Information Service (VHI)
VHI of previous year VHI of current year
SOUTHERN AFRICA - VEGETATIVE HEALTH INDEX
5/17/2020
61,4 39,6 61,1 38,0 55,6 29,8 54,3 26,7 53,4 28,6 54,1 31,0 53,4 30,6
16,8
22,3
14,0
18,6
14,0
17,9
13,2
17,9
13,8
18,4
15,5
18,6
17,1
19,8
6,9
5,4
6,2
4,0
6,1
3,3
5,7
4,1
4,9
4,2
4,6
4,0
4,4
3,4
5,6
13,0
6,0
14,0
5,8
13,9
5,8
13,6
5,4
12,6
5,0
10,4
5,6
11,3
0,5
1,7
0,4
1,5
0,5
1,7
0,7
2,3
0,7
2,2
0,7
2,3
0,6
2,1
6,6
9,1
9,9
13,8
14,6
19,8
16,6
22,2
18,2
23,4
16,6
21,2
14,8
20,3
1,8
4,2
1,8
4,7
2,9
7,6
3,3
7,7
3,3
7,4
3,2
7,0
3,6
8,7
0,4
4,7
0,5
5,4
0,5
6,0
0,4
5,4
0,4 3,0
0,3
5,3
0,4
3,8
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1H17Incl.
1H17Contr.
2H17Incl.
2H17Contr.
1H18Incl.
1H18Contr.
2H18Incl.
2H18Contr.
1H19Incl.
1H19Contr.
2H19Incl.
2H19Contr.
1H20Incl.
1H20Contr.
Maize Soybean Meal Sunflower Meal Other Fish Meal F/Fat and Extr Soy Soya Oil Vitamins, Minerals and Medication.
51
BROILER FEED – INGREDIENT INCLUSION & COST CONTRIBUTION
Source: Own Data 5/17/2020
80%
90%
100%
110%
120%
130%
140%
150%O
ct-
14
Dec-1
4
Fe
b-1
5
Ap
r-15
Ju
n-1
5
Au
g-1
5
Oct-
15
Dec-1
5
Fe
b-1
6
Ap
r-16
Ju
n-1
6
Au
g-1
6
Oct-
16
Dec-1
6
Fe
b-1
7
Ap
r-17
Ju
n-1
7
Au
g-1
7
Oct-
17
Dec-1
7
Fe
b-1
8
Ap
r-18
Ju
n-1
8
Au
g-1
8
Oct-
18
Dec-1
8
Fe
b-1
9
Ap
r-19
Ju
n-1
9
Au
g-1
9
Oct-
19
Dec-1
9
Fe
b-2
0
Broiler selling price index Six month average
52 Source: Own Data
Lower brine effect
BROILER SELLING PRICE
5/17/2020
53
BROILER PRICE vs. FOOD PRICE INFLATION
Source: Own Data & CJA Strategic Risk Brokers
90%
100%
110%
120%
130%
140%
150%
90%
100%
110%
120%
130%
140%
150%O
ct-
14
De
c-1
4
Fe
b-1
5
Ap
r-15
Ju
n-1
5
Au
g-1
5
Oct-
15
Dec-1
5
Fe
b-1
6
Ap
r-16
Ju
n-1
6
Au
g-1
6
Oct-
16
Dec-1
6
Fe
b-1
7
Ap
r-17
Ju
n-1
7
Au
g-1
7
Oct-
17
Dec-1
7
Fe
b-1
8
Ap
r-18
Ju
n-1
8
Au
g-1
8
Oct-
18
Dec-1
8
Fe
b-1
9
Ap
r-19
Ju
n-1
9
Au
g-1
9
Oct-
19
De
c-1
9
Fe
b-2
0
Broiler selling price index SA food price index
5/17/2020
54 Source: SAPA, FNB, Red Meat Industry Forum
SOUTH AFRICAN PROTEIN PRICE COMPARISON
Chicken Pork Beef Mutton
Feed Conversion Rate 1.5 2.2 5.5 5.0
Per Capita Consumption 39,3 kg 5,1 kg 17,2 kg 3,1 kg
cents / kg
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
9 000
Oc
t-1
4
De
c-1
4
Feb
-15
Ap
r-1
5
Ju
n-1
5
Au
g-1
5
Oc
t-1
5
De
c-1
5
Feb
-16
Ap
r-1
6
Ju
n-1
6
Au
g-1
6
Oc
t-1
6
De
c-1
6
Feb
-17
Ap
r-17
Ju
n-1
7
Au
g-1
7
Oc
t-1
7
De
c-1
7
Feb
-18
Ap
r-1
8
Ju
n-1
8
Au
g-1
8
Oc
t-1
8
De
c-1
8
Feb
-19
Ap
r-1
9
Ju
n-1
9
Au
g-1
9
Oc
t-1
9
Dec-1
9
Feb
-20
5/17/2020
55 Source: Own Estimates
LOCAL BROILER PRODUCTION & MARKET SHARE
Local broiler production ≈ 19.6 million birds per week
26%
20%
9%
7%
8%
5%
4%
21%
Astral RCL Country Bird Daybreak Sovereign Grainfields Chubby Chick Other
5/17/2020
56 Source: Own Estimates
LOCAL BROILER PRODUCTION & MARKET SHARE
18%
14%
6%
5%
6% 4% 3%
15%
29%
Astral RCL Country Bird Daybreak Sovereign Grainfields Chubby Chick Other Imports
Avg. poultry imports ≈ 7.7 million birds per week
(6 months ending March 2020)
5/17/2020
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
F2017 50 324 101 279 135 812 173 187 212 399 278 057 319 933 367 106 409 557 453 981 499 952 551 867
F2018 46 348 92 223 140 823 188 065 228 295 281 102 327 753 374 838 412 638 461 454 523 205 579 661
F2019 45 061 89 632 127 371 162 545 204 659 250 646 302 318 354 046 408 633 455 069 502 306 538 605
F2020 40 409 86 676 128 331 170 449 216 314 257 443
0
100 000
200 000
300 000
400 000
500 000
600 000
F2017 F2018 F2019 F2020
57 Source: SAPA
TOTAL POULTRY IMPORTS (CHICKEN, MDM, TURKEY)
F2019 45 061 44 571 37 739 35 174 42 114 45 987 51 672 51 728 54 587 46 436 47 237 36 299
F2020 40 409 46 267 41 655 42 118 45 865 41 129
% Var -10,3 3,8 10,4 19,7 8,9 -10,6
bpw* 7.2 8.3 7.5 7.5 8.2 7.4
*bpw ≈ million birds per week
Tons
5/17/2020
58 Source: SAPA
TOTAL POULTRY IMPORTS – COUNTRY OF ORIGIN
Brazil 49,8%
EU 23,1%
Argentina 7,0%
US 16,6%
Other 3,5%
Country of origin for poultry imports - 2019
538 605 tons 257 443 tons
Brazil 50,2%
EU 17,7%
Argentina 7,1%
US 22,2%
Other 2,8%
Country of origin for poultry imports – March 2020 YTD
5/17/2020
59 Source: SAPA
TOTAL POULTRY IMPORTS – COUNTRY OF ORIGIN
Country Imports (tons)
2018 2019 2020 YTD
Brazil 348 155 268 869 64 844
United States 91 374 89 598 28 722
Poland 13 463 50 419 4 294
Argentina 33 278 37 939 9 110
Ireland 26 328 31 221 7 450
Denmark 25 672 23 325 4 198
Spain 4 932 18 824 6 495
Thailand 9 011 8 728 1 003
Canada 7 305 6 658 1 584
Chile 4 362 2 341 454
Australia 553 780 427
Germany 222 326 46
United Kingdom 231 224 0
Netherlands 359 101 25
Uruguay 323 52 135
Belgium 23 52 0
France 5 30 0.8
Switzerland 97 23 0
Swaziland 482 23 0
Other 0 27 25
5/17/2020
60
COVID-19 MEASURES
5/17/2020
61
COVID-19 MEASURES
5/17/2020
62
COVID-19 MEASURES
5/17/2020
63
COVID-19 MEASURES
5/17/2020
64
COVID-19 MEASURES
5/17/2020
Chris Schutte
Chief Executive Officer
Tel : +27 (0) 12 667 5468
Fax : +27 (0) 86 504 2002
email: Chris.Schutte@astralfoods.com
www.astralfoods.com
Daan Ferreira
Chief Financial Officer
Tel : +27 (0) 12 667 5468
Fax : +27 (0) 86 504 1602
email: Daan.Ferreira@astralfoods.com
5/17/2020
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