società soggetta a direzione e coordinamento di b.s.a. s.a. …€¦ · lbr brf total net sales...
TRANSCRIPT
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Highlights on acquisitions in Brasil
3rd February 2015
Società soggetta a direzione e coordinamento di B.S.A. S.A.
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The Market: Big opportunities to be explored in Brazil
Brazil is a major producer with +30 mn ton./yr
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Indi
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US
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Chi
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Pak
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Rus
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Braz
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Ger
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Fran
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Aus
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New
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Milk supply can be found in most regions in Brazil
(mn ton.) 2011 2012 2013E
Milk Supply:Milk Production 32.0 33.1 34.0
Industrialized 21.7 22.9 23.0Informal 10.4 10.2 10.0
Imports 1.2 1.4 1.5Exports 0.1 0.1 0.1
Total 33.3 34.4 35.5
Brazil’s market is sizable, underpenetrated and highly informal
Source: FAO Statistical Yearbook 2013
Source: FAO/Faostat, CONAB and IBGE, World Bank
Local statistics bureau’s 2009 milk production heat map
2011 2012 2013E
Population (mn. people) 194.9 196.5 198.0Consumption per capita (L/yr) 173 177 181
Annual vol. produced (mn ton.)
2
GDP in absolute terms amounted to 2,245 bln US$ in 2013, making Brasil the 7o worldwide economy in terms of GDP and 5o in terms of population size.(source: Worldbank database)
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Local market characteristics
Dairy is consumed as UHT, powder milk and cheese
Geography plays a critical role in milk production
UHT26%
Cheese31%
Powdered Milk24%
Pasteurized Milk
6%
Others13%
Milk is mostly produced by smallholders
Cow / Farm Milk Production Dairy Farms
Liters / Farm/ Day Nº 000 ton. % Nº %
2,000 212 7,032 22% 6,255 1%TOTAL 19 32,451 100% 1,209,022 100%
Source: LEITE BRASIL, CNA, OCB, CBLC and Embrapa/Gado de Leite Source: Embrapa 3
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Current market share of dairy players
4
00%
05%
10%
15%
20%
25%
Nestle Danone BRF Vigor LBR
• Current competitive scenario in dairy sector in Brasil sees BRF as third player and LBR as fifth player.
• The joint acquisition of BRF’s dairy business and LBR’s UPI’s will allow for an efficient mix of product range , as described on the next pages
based on Nielsen data
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Brazil’s competitive landscapesnapshot by dairy segment: market share1 of top 5
Cheese
00%
05%
10%
15%
20%
25%
30%
Danone Nestle Brf Vigor Yakult
Refrigerated Products
00%
02%
04%
06%
08%
10%
12%
14%
16%
LBR BRF Tirol Italac Piracanjuba
UHT
00%05%10%15%20%25%30%35%40%45%
Nestle Vigor Embare la serenissima BRF
Powder Milk
00%
02%
04%
06%
08%
10%
12%
Polengui BRF Tirolez LBR Quata
1) Shares in terms of sales in 2014 YTD according to Nielsen data 5
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Acquisition of LBR’s UPIs
UPI Plants
UPI 7 Fazenda Villa Nova
Main products Notes
UHT milk Parmalat brand
UPI 8 Barra Mansa UHT milk
UPI 11 Curral NovoPouso Alto
Cheese
UPI 12 N/A Requeijão (cream cheese)
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Parmalat brand
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BRF’s indicative portfolio and sales mix (value)
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How Parmalat acquisitions could shape competitive landscapeExpected snapshot of top players by dairy segment in Brazil
Cheese Refrigerated Products
UHT Powder Milk
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Parmalat Polenghi Tirolez Quata Danone Nestle Parmalat Vigor
Parmalat Tirol Italac Piracanjuba Nestlé Vigor Embaré La Serenisima Parmalat
1
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Estimated(*) overall market share of key dairy players
9
Danone Nestle Parmalat Vigor
Overall, Parmalat could become the Nr 3 player in the Brazilian dairy market
(*) Based on aggregation of different product categories
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Industrial footprint
10
Parmalat will have a total of 17 plants:
• 2 existing (Balkis) – cheese
• 4 from LBR – mainly UHT and cheese
• 11 from BRF – entire product mix for dairy
The best part of the industrial footprint is concentrated in the central/southern states, which are:• The ones with more abundant/cheaper milk• The ones with the highest purchasing power
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Brazil demographic figures by region
11CONFIDENTIAL
Region Pop.(mn)% of Brazil
popGDP
(R$ bn)% of Brazil
GDP
Southeast 80.4 42.1% 2,296 55.4%
Northeast 53.1 27.8% 555 13.4%
South 27.4 14.4% 672 16.2%
North 15.9 8.3% 224 5.4%
Midwest 14.1 7.4% 396 9.6%
Source: IBGE (Considers IBGE census figures on 2010 resident population and IBGE census figures on 2011 GDP at current prices)
Brazil
Pop: 190.8 mnGDP: R$ 4,143 bn
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(*) 2013
LBR BRF Total
Net Sales Euro (mn) 190 825 1,015
Enterprise Value Euro (mn) 83 570 653
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Key figures for the combined business
(*) Pro‐forma indicative figures for acquired business
• Management of acquired LBR’s assets (UPIs) started on 1st November 2014. Actual payment ofpurchase price executed in January 2015.