ISAGRO: "SMALL GLOBAL PLAYER" OF AGROPHARMA RESULTS AND PERSPECTIVES

Transcription

1 ISAGRO: "SMALL GLOBAL PLAYER" OF AGROPHARMA RESULTS AND PERSPECTIVES STAR CONFERENCE 2013 Milan, March 27 th, 2013

2 AGROPHARMA MARKET ISAGRO RESULTS PERSPECTIVES AND CONCLUSIONS 2

3 The growing need for food is a challenge for agriculture WORLD POPULATION: GROWING BIO-FUELS: GROWING AGROPHARMA MARKET World Population (Billion) Ethanol production (Billion liters) LIMITED NEW ARABLE LANDS STRATEGIC EXIGENCY: TO INCREASE PRODUCTIVITY PER HECTARE IN A SUSTAINABLE WAY SOCIAL/ ENVIRONMENTAL ISSUES Source: USDA 3

4 Agropharma have a key role in agriculture AGROPHARMA MARKET The pharmaceutical products for crop protection/yield enhancement Unavoidable losses: ~ 40% Losses avoided thanks to agropharma: ~ 30% Production without agropharma: ~ 30% Actual production (60%) Potential agricultural production (100%) World market value (2012): US$ 47 billion Time-to-market for new molecules: years Sources: Phillips McDougall and Agrofarma 4

5 A global market AGROPHARMA MARKET Breakdown by geographic area US$ 47 billion (2012) NAFTA 18% Europe 27% and by product type Fungicides 26% Insecticides 25% Others 3% Center & South America 24% Africa & Middle East 4% Asia 27% Herbicides 46% Source: Phillips McDougall. Figures in % refers to

6 based on innovation AGROPHARMA MARKET Players (Data 2011) "Role" of innovation (Data 2011) With "Innovative Research" (based on specialty products) Mkt share % Without "Innovative Research" (based on generic products) Mkt share % Patented product 24% Bayer Syngenta > 15 Maktheshim-Agan Nufarm 5-15 BASF Monsanto Dow DuPont 5-15 Arysta FMC Cheminova UPL 2-5 Sumitomo Nippon Soda Mitsui Nihon Nohyaku ISAGRO 0.5 Chemtura Sipcam-Oxon Off-patented Products still sold only by discoverer 25% Generic products 51% Source: Phillips McDougall 6

7 AGROPHARMA MARKET in which a small player but with innovative research, like Isagro, can compete MARKET: HIGHLY SEGMENTED (COUNTRY/CROP/DISEASE) Local/multi-local players, without innovative research but with distribution, have a strategic interest to access innovative products Mkt share ISAGRO 2011 Brazil/Cotton/Ramularia Japan/Sugar beet/cercospora leafspot Italy/Olive/Various fungal diseases Italy/Grape/Downy mildew USA/Sugar beet/cercospora leafspot USA/Soybean/Various diseases Spain/Olive/Various fungal diseases Brazil/Soybean/Asian rust 48% 40% 54% 12% 20% 12% 10% 4%

8 AGROPHARMA MARKET ISAGRO RESULTS PERSPECTIVES AND CONCLUSIONS 8

9 Isagro: "Small global player" ISAGRO SMALL VS. COMPETITORS, GLOBAL FOR BEING BASED ON INNOVATION CORE-BUSINESS ISAGRO 2012E REVENUES: 148 m of which: 80% EX-ITALY FUNGICIDES: 65% OF SALES ALONE AND/OR IN PARTNERSHIP SALES IN > 70 COUNTRIES EMPLOYEES: 620 of which: 308 EX-ITALY INNOVATIVE RESEARCH DEVELOPMENT CHEMICAL SYNTHESIS (active ingredients) FORMULATION (finished products) INT L MARKETING AND LOCAL DEVELOPMENT DISTRIBUTION (on local basis) 1 R&D CENTER AND 1 FIELD TRIAL CENTER (ITALY), 1 PILOT PLANT (INDIA) 5 MANUFACTURING PLANTS (4 IN ITALY AND 1 IN INDIA) DIRECT PRESENCES IN: DIRECT PRESENCES IN COLOMBIA, INDIA, SPAIN AND USA 9

10 with a history of growth ISAGRO to 2000 Revenues 67 mln Employees ~150 ISAGRO S.p.A. to today Revenues ~ 148 mln Employees % 50% 100% Isagro Italia Isagro Ricerca Isagro BioFarming 63% 100% 51% AgriFormula Isagro Hellas ISAM From 1993 Revenues 45 mln Employees ~120 ISAGRO S.r.l. (ORIGINATED BY MONTEDISON, M.B.O. FROM ENICHEM AGRICOLTURA) Isagro is also present in Argentina, Australia, Chile and South Africa with companies locally entitled of the Group s registrations 10

11 and five strategic guidelines ISAGRO 1 INNOVATIVE RESEARCH RUN IN AUTONOMY 2 DEVELOPMENT OF NEW MOLECULES/PRODUCTS IN PARTNERSHIP (for molecules/products requiring high investments and with global market potential) 3 DEVELOPMENT OF GENERICS FOR MIXTURES AND, INITIALLY, FOR INDIAN MARKET (leveraging on Isagro s industrial and distribution presence in India) 4 DEVELOPMENT IN HIGH POTENTIAL MARKETS/REGIONS AND OF SELECTIVE PRESENCES IN DIRECT DISTRIBUTION 5 SELF-FINANCED INVESTMENTS & POLICY OF PORTFOLIO OPTIMIZATION 11

12 AGROPHARMA MARKET ISAGRO RESULTS PERSPECTIVES AND CONCLUSIONS 12

13 Market and Isagro in 2012 RESULTS MARKET (fungicides representing ~26%) MARKET OF FUNGICIDES (ON WHICH ISAGRO IS FOCUSED) INFLUENCED BY: DROUGHT IN EU lower sales vs. 2011, year-end stocks and carry-over effect in 2013 DROUGHT IN USA sales finalized but partially remained in stock, with carry-over effect in 2013 DECREASE IN COTTON PRICES lower areas planted with cotton in Brazil and pressures on volumes/prices ISAGRO (fungicides representing ~65%) NEW REGISTRATIONS: DEVELOPMENT OF SALES, BASED ON PAST INVESTMENTS 2012 SALES: +14 m vs BASIC BUSINESS : LOWER SALES DUE TO DROUGHT / DECREASE IN COTTON PRICES 2012 SALES: -10 m vs R&D INVESTMENTS: ~8% OF SALES OF PROPRIETARY AGROCHEMICALS, WITH START OF DEVELOPMENT OF TWO NEW PRODUCTS (Out of which one in partnership) 13

14 Consolidated sales: 2012 vs /2: Main variations million RESULTS Normalized 2012 sales ~ 160 M 144 Basic Business -10 M Effect of Drought/EU - 6 Effect of Cotton/BRA + 3 Incremental sales from «basic business» + 14 Incremental sales from new registrations* 28 Impact of temporary nature (drought) and of cyclical nature (cotton prices) -13 M (with carry-over effect to 2013) BASIC BUSINESS NEW REGISTRATIONS 2012 * Sales from new registrations also impacted by drought, vis-à-vis their potential value 14

15 Consolidated sales: 2012 vs /2: Breakdown by category and by region (Totale (Total Ricavi) Sales) million (Only Agropharma) RESULTS CONSOLIDATED SALES: 148 (+3%) Americas 35% Rest of Europe 21% % -2% Total Agropharma: % Total Agropharma: 134 Rest of Europe 22% Italy 20% 134 RoW 4% Americas 28% Asia 20% CONSOLIDATED SALES: 144 Other prod. and services Third parties agropharma Proprietary Agropharma Italy 23% RoW 6% Asia 21% 15

16 Results RESULTS million REVENUES (In box: revenues from proprietary agropharma) EBITDA excluding extraordinary items (In box: Net result) (4.3) Before dismissal 2010 Pro-forma after dismissal Before dismissal 2010 Pro-forma after dismissal NET FINANCIAL POSITION (In box: NFP backing fixed assets) 148 NFP/EBITDA and D/E (EBITDA excluding extraordinary items) Before dismissal Pro-forma after dismissal NFP/EBITDA 1.9 DEBT/EQUITY Before dismissal 1.2 Pro-forma after dismissal

17 AGROPHARMA MARKET ISAGRO RESULTS PERSPECTIVES AND CONCLUSIONS 17

18 Perspectives PERSPECTIVES AND CONCLUSIONS CARRY-OVER EFFECT FROM 2012 DROUGHT IN USA AND EUROPE (IN THE FUNGICIDES SEGMENT, DUE TO STOCK CONSUMPTION) CONSOLIDATED SALES ESTIMATED AT A LEVEL OF 140 MILLION ECONOMIC RESULT, BEFORE ONGOING ACTIONS FOR EXTRAORDINARY OPERATIONS, EXPECTED LOWER THAN 2012 EXTRAORDINARY OPERATIONS TO SELF-FINANCE DEVELOPMENT PROJECTS PROGRESSIVE RECOVERY OF SALES OF THE BASIC BUSINESS WITH CONTINUATION OF THE GROWTH TREND OF THE SALES FROM NEW REGISTRATIONS LAUNCH OF THE NEW SOIL-APPLIED BIO-PESTICIDE IRF135 IN USA CONSOLIDATED SALES ESTIMATED AT A LEVEL OF 170 MILLION 2015 CONSOLIDATED SALES ESTIMATED AT A LEVEL OF 200 MILLION 18

19 Conclusions PERSPECTIVES AND CONCLUSIONS CONFIRMATION OF «ISAGRO PROJECT» AS A SMALL GLOBAL PLAYER OF AGROPHARMA, BASED ON INNOVATIVE RESEARCH AND ON DEVELOPMENT OF PROPRIETARY PRODUCTS AND GENERICS (THE LATTER ONES INITIALLY FOR PROPRIETARY MIXTURES AND FOR THE INDIAN MARKET, LEVERAGING ON OUR CONSOLIDATED PRESENCE IN INDIA) DESPITE THE EFFECTS FROM DROUGHT IN USA/EU IN THE SHORT-TERM, THE PHASE OF «HARVESTING» FROM PAST INVESTMENTS HAS BEGUN, AND FURTHER ACTIONS BY THE NEW MANAGEMENT TEAM SHALL FOLLOW, AIMING AT EXPLOITING MARKET SEGMENTS NOT COVERED YET NEW MANAGEMENT TEAM IS WORKING ON A NEW BUSINESS PLAN FOR , WHICH WILL BE PRESENTED IN 4 th QUARTER

20 Disclaimer Estimates, considerations, statements and opinion, except for what referring to actual figures, are to be considered as data, estimates, considerations, statements and opinion regarding future, and have been elaborated and stated on the basis of available information and/or on the basis of those information considered the most reliable and/or the most reasonable. Such data, estimates, considerations, statements and opinion could prove to be incomplete and/or wrong and they incorporate elements of risk of uncertainty, beyond the company control. For such reasons, actual results may prove to differ versus data, estimates, considerations, statements and opinion contained in such presentation. Such data, estimates, considerations, statements and opinion are not to be considered as a proposal of investment, under any circumstances, in Isagro s shares. Any reference to Isagro products is to be considered exclusively as general information about the group activity and is not to be intended, under any circumstances, as invitation to employ or propose the employment of such products. 20

21 Contacts For information: ISAGRO S.p.A. Ruggero Gambini Chief Financial Officer & IR Manager Alessandro Zacchera Assistant to IR Manager & Junior Strategic Planner tel. (+39)