IMO HILL FARMS July 2015

Transcription

1 IMO HILL FARMS July 2015 Teaser Document

2 Contents INTRODUCTION THE COMPANY EXPANSION STRATEGY MARKET ASSESSMENT THE OPPORTUNITY 20

3 3 Introduction

4 Introduction Page 4 Imo Hill Farms Limited ( IHF or the Company ), is a private limited liability company engaged in animal husbandry (piggery & poultry), meat processing and feed production The Company has recently undertaken a strategy to expand its current operations and has commenced its expansion plans This document contains a brief background of IHF, its operations and its expansion plans; and highlights an opportunity to all interested investors to partner with the Company Detailed information will be made available to all parties that are interested in pursuing this opportunity further

5 5 The Company Background Information The Farm Products Current Facilities Current Operational Strategy for Layers Current Operational Strategy for Broilers Current Operational Strategy for Pigs

6 Background Information Page 6 Imo Hill Farms Limited ( IHF or the Company ), located at 1 Joseph Awomolo Street, Imo, Ilesa, Osun State was incorporated in June 1979 as a private limited liability company The Company is engaged in animal husbandry (piggery & poultry), meat processing and feed production The Company is owned largely owned by the Awomolo Family through their company, Newco Investment, which has a 96.7% equity stake In the late 80 s, the foundation stock of pigs raised in the farm were sourced from Germany with the herd growing to about 3,000 pigs. By the mid-nineties, the farm was fully stocked with over 7,000 pigs In 2013, the piggery was reactivated with genetics from Topigs SA. From an initial stock of 173 pigs, the pig farm has grown to over 2,500 herd comprising both commercial and breeding pigs Imo Hill Farms has been awarded SON NIS 517:2006 Certification of conformity for its Table Eggs while its other farm products are in the process of being certified IHF has over 160 employees, including some expatriate staff

7 The Farm Page 7 The farm is sited on 48 acres of land in the Imo hill area of Ilesa, Osun state, Nigeria The farm has a broiler facility in Osu, a 30 minutes drive from Ilesa township covering about 41 acres of land The farm has undergone massive transformation in terms of infrastructural development and system/process engineering and hence can be seen as an integrated livestock farm offering superior quality products such as eggs, broiler, pork and processed meat to consumers

8 Products Page 8 IHF s pig herd consist of Topigs A Line gilts, Topigs Top40 gilts, B Line boars and TEMPO boars. IHF uses artificial insemination to breed its Top40 sows which its uses for commercial production IHF rears broilers, layers and produces Table eggs IHF processes two types of meat: Pork and Chicken. The pork is processed into sausages, hams and bacon. The processed chicken is available in whole and portioned pieces IHF has a Feed mill plant that produces all the feed utilized in the farm

9 Piggery Poultry Feedmill Meat Processing Current Facilities Page 9 11 Pens Artificial Insemination Unit 2 Broiler Houses (25,000 capacity each) 5 Layer Houses 1 Rearing House (26,000 capacity) Central Feeding Station Two separate production lines with circa 3 tons per hour capacity Broiler Processing Unit (1000 birds hrly) Pork Processing Unit (40 pigs daily) Cold Rooms Holding Freezer Cooling Rooms 45 pig carcass capacity hanging room Vacuum Sealing Machine Automatic Slicer Deriding machine Ice making Machine Some of these facilities were constructed and acquired under the Company s Expansion Strategy

10 Current Operational Strategy for Layers Page 10 In-house rearing of Day Old Chicks Distribution & Sale to market of Table eggs and Spent Layers Purchase of Day Old Chicks Production of Table eggs

11 Current Operational Strategy for Broilers Page 11 In-house rearing of Day Old Chicks to maturity Distribution & Sales to market Purchase of Day Old Chicks Processing of broilers to frozen processed products

12 Current Operational Strategy for Pigs Page 12 Artificial Insemination of sows Processing of pigs to frozen processed products Purchase of Boars Rearing of piglets to maturity Distribution & Sales to market

13 13 Expansion Strategy Expansion Strategy Funding Requirement

14 Expansion Strategy IHF s Board decided to expand its operations in line with its mission of developing a vertically integrated protein production unit. This expansion was agreed to be undertaken in two phases as follows : Phase 1 Phase 2 Poultry Expansion Work to date Expansion Work to date Rearing/Layer Unit Construction of 26,000 capacity Rearing House for Day Old Chicks (DOC) Broiler Unit Construction of 2 Broiler sheds (26,000 capacity each) Breeder Farm & Hatchery Unit Rearing House has been completed and is operational Broiler sheds have been constructed but are 50% operational Construction of 42,000 capacity Rearing House for DOC Construction of 11 Layer Sheds (17,000 capacity) Construction of 19 additional Broiler houses with 26,000 capacity each Nil Nil Construction of 2 rearing sheds of 5,900 DOC capacity each Construction of 6 Breeder farm sheds Acquisition of Hatchery Equipment Nil Nil Nil

15 Expansion Strategy (2) Phase 1 Phase 2 Piggery Expansion Work to date Expansion Work to date Pigs Resuscitation of Breeder unit Construction of Artificial Insemination (AI) Unit Chicken Processing Unit Pork Processing Unit Installation of Chicken abattoir (1,000 bird/hr) Installation of Cold storage, Blast freezer (5 tons) and Holding freezer (30 tons) Set up of Abattoir and further processing Unit Installation of Cold rooms. Breeder Unit has been resuscitated and is operational The AI Unit building is almost completed but the AI Program is operational on a temporary site Abattoir has been installed and is operational Cold storage, Blast freezer and Holding freezer have been installed and are operational Abattoir completed and operational Further processing Unit completed and partly operational Cold storage installed and Relocation Breeder Herd of Upgrade of Cold storage by 600 tons Equipment Upgrade Nil Nil Nil

16 Expansion Strategy (3) Phase 1 Phase 2 Feedmill Expansion Work to date Expansion Work to date Cropping Division Equipment Nil Nil Acquisition of 400- hectare farmland Set up of maize/soya farm Capacity upgrade from 5 tons per day to 25 tons per day Upgrade has been completed and is operational Construction of new Feedmill (150 ton per day capacity) 50% down payment has been made Nil

17 N'000 Funding Requirement Page 17 Phase Broiler Meat Processing Working Capital IHF requires a sum of N108million to consolidate and achieve full optimisation of the facilities installed in Phase 1. N20million will be used to acquire equipment required at Broiler House 2 and for other necessary construction works to be done in the house. The N10million will be used to buy an additional blast freezer to be used in the meat processing factory while the balance of the N78million will serve as working capital for the next three months IHF estimates that these sums will be utilised till year end 2016 and that Phase 2 will commence in 2017

18 18 Market Assessment

19 '000 tonnes Market Assessment Page 19 Demand for livestock products estimated at 2.4 million tonnes per annum whilst supply is only 1.2 million tonnes Therefore a supply gap of 1.2 million tonnes per annum of livestock products Market size of supply gap estimated at N1.35 trillion Demand Supply Supply Gap Market size of Gap 000 tonnes N mm Poultry ,580 Pork ,363 Eggs 1, , , , , ,345,953 Demand Vs Supply of Livestock Products Hence, there is an opportunity for IHF s increased products to fill some of this gap Poultry Pork Egg Source: FAO Statistics Demand Supply

20 20 The Opportunity

21 The Opportunity Page 21 Some of the opportunities available for IHF in Nigeria include: Increased demand for poultry products from local farmers due to ban on the importation of frozen chicken and Government s continuous efforts to prevent the smuggling of frozen poultry products The Central Bank of Nigeria s exclusion of importers of poultry/meat products from accessing foreign exchange loans in the Nigerian market Increased demand for table eggs as it is the cheapest source of protein to Nigerians Increase and popularity of Quick Service restaurants in urban centres Rapid growth in the Nigerian population Reduction in feed cost and improved nutrient quality of feed from in-house feed production Strategic location of IHF with proximity to the Northern and South-South regions

22 Contacts Page 22 Frontier Capital Limited UBA House (8 th Floor) 57 Marina Lagos Contact Persons Melody Fayomi ( ) Moji Jimoh ( ) Tayo Oduwole ( )