Farm Pride Foods Ltd. Annual General Meeting 2012 Managing Director s Update

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Mark Robinson
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1 Farm Pride Foods Ltd. Annual General Meeting 2012 Managing Director s Update 1

2 Business Overview for FY 2012 Slightly improved financial result to FY2011. Increased free range capability and sales to major customers as key strategic objective. Growth in egg products business. Continued pressure on cage egg prices Significant progress on major projects in free range, grading g and sale of surplus land. Continued focus on productivity improvement in all areas. Enhanced procedures on workplace safety. AGM

3 Financial Performance Summary *figures rounded Revenue of $93.4m ($91.7m for FY 2011) EBITDA of $5.1m $2.86m (1 st half ) $2.24m (2 nd half ) Loss of $0.4m: $0.034m profit (1 st half ) ($0.433m) loss (2 nd half) AGM

4 Gross Revenue $ 000 AGM

5 Eggs Sold(History) * Excludes Product Plant AGM

6 $ 000 EBITDA (excluding Goodwill Impairment) AGM

7 Debt Reduction Summary BORROWINGS $25.0 $20.0 illion $ Mi $15.0 $10.00 $18.0 $16.2 $14.9 $14.7 Loan Lease $5.0 $0.0 $5.7 $5.4 $4.4 $4.1 FY 08/09 FY 09/10 FY 10/11 FY 11/12 A further debt reduction of $2.4m is expected from the proceeds of the Keysborough land sale. Cash balance at 30 June 2012 of $1.022m. AGM

8 National Supermarket Sales (doz) x Segment MAT Total supermarket egg volumes 4.7% MAT. Primarily driven by growth in Free Range and branded cage eggs. Free range sales grew 23.1% MAT. Barn laid sales 8.9% MAT. AGM

9 Coles segment share (%) Since the introduction of Coles Down Down on egg in Nov 10, Coles % sales of free range has increased from 28.7% to 42.3% of all egg purchases. AGM

10 Key Projects ACACIA LANE Free Range Farm AGM

ACACIA LANE Free Range Farm 1 st shed started

Peter Walsh MLA, Minister for Agriculture & Food

Producing approx. 2.1m dozen eggs per annum.

which improves quality of eggs produced at lower

11 ACACIA LANE Free Range Farm 1 st shed started production in February Opened by the Hon. Peter Walsh MLA, Minister for Agriculture & Food Security and Minister for Water on 12 October Producing approx. 2.1m dozen eggs per annum. Utilises modern automated egg collection system which improves quality of eggs produced at lower costs. Strong emphasis on bird welfare and production efficiency. AGM

12 Greendale Grading Facility AGM

Greendale Grading Facility Scheduled to commence operating by

incorporating: 3,000 m 2 under roof Water capture from roof with

modules Latest high capacity Moba 330 grading machine.

13 Greendale Grading Facility Scheduled to commence operating by end of November 2012 Modern, state of the art facility incorporating: 3,000 m 2 under roof Water capture from roof with 1.2m ltr storage capability Ability to accommodate pallets and modules Latest high capacity Moba 330 grading machine. High capacity automated egg collection system for associated free range farm. AGM

14 Greendale Grading Facility (continued) Located on large site which includes a free range farm. 16 sheds on the property. Producing over 3.6m dozen eggs p.a. AGM

15 Keysborough Site Sub-Division Expect to complete sub-division and sale of approx. 50% of existing Keysborough site by end of December Surplus funds from the sale of $2.4m to be applied to debt reduction. New offices being created inside existing factory. AGM

16 Other Initiatives Investment in all free range farms with new fencing, perching and stocking densities to meet customer requirements. Improvements in diets and feed methodology to better meet specific free range and cage conditions. Continual improvement in productivity and total throughput in carton packaging operations. Have commenced egg printing at all locations in line with FSANZ requirements. Continued focus on workplace safety. AGM

17 Chook Cam is live! Farm Pride website now has a live chook cam from one of our free range farms. New farms to be added to the network AGM

18 The number One Egg Timer iphone App 3.5 thousand downloads in under 2 months AGM

19 McGrath Pink Pack Total Novo Foods donation of $150,000 19

20 Strategic Focus Grow free range production and sales. Strengthen position in barn category. Improve size and efficiency of products business. Improve efficiency and reduce cage egg operations. Continue to develop our people and focus on workplace safety. AGM

21 1st Half of 2012/13 Financial Year Continued solid performance in free range and product sectors. Significant increase in feed costs combined with price pressure for cage eggs have placed pressure on margins. Installation of washer at Lethbridge grading floor and imminent commencement of operations at the Greendale grading floor. Progress on Keysborough land sub-division. AGM

22 Outlook for Remainder of 2012/13 Financial Year Continued growth in free range as a proportion of total sales. Pricing pressure on cage eggs expected to remain. Feed prices have stabilised but forward pricing will be impacted by many Australian and global factors. Commencement of the Greendale grading floor operations and the full benefit of the washer upgrade at Lethbridge are expected to reduce costs. AGM

23 Questions? AGM

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