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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: [email protected]

    www.astralfoods.com

    Daan Ferreira

    Chief Financial Officer

    Tel : +27 (0) 12 667 5468

    Fax : +27 (0) 86 504 1602

    email: [email protected]

    5/17/2020