Seeka provides investor presentations

Seeka Limited

Investor presentation – April 2019

2
Our Business
Delivering orchard-to-market excellence
In Australia
-Grow, process and market
Kiwifruit
Nashi pears
European pears


In New Zealand
-Grow, process and market
1

Kiwifruit
2

Avocado
Kiwiberry
-Develop, lease and manage orchards
-Manufacture
Kiwi Crush, avocado oil
-Import, ripen and supply
Bananas, tropical fruit
-Wholesale
Seasonal produce

Largest grower of
kiwifruit in New Zealand
and Australia
Australia’s largest
nashi grower
1. Seeka also processes citrus and berries
2. NZ kiwifruit is predominantly marketed by Zespri

3
An investment entry point to New Zealand kiwifruit and avocados
-Geographical reach
-Integrated service from orchard to retail
-Major supplier of NZ kiwifruit to Zespri
2
Significant orchard and produce business in Australia (including kiwifruit)

3
Capital already invested to increase supply and fruit handling capacity

4
A premium produce company
-Major varieties Kiwifruit, Avocados, Nashi and European Pears
1
Seeka’s key investment attributes
Positioned for further growth

5

4
Highlights
Financial year ending 31 December 2018 - audited


1. Yet to settle $9.8m of the purchase
Financial
-$203.7m total revenue
-$26.2m EBITDA
-$7.4m profit after tax
-$0.37 earnings per share
New Zealand Kiwifruit volumes up
-31.4m trays of New Zealand kiwifruit harvested and packed – up 23% on pcp
Growth
-Acquired T&G Horticulture’s post harvest business and kiwifruit orchards for $42.1m¹ in 2018
-Developing Australian orchards
-Investing in New Zealand post-harvest infrastructure
-Purchase of Aongatete Coolstores Limited in 2019 for $25m
Recapitalised
-Fully-subscribed rights issue raised $47.9m in 2018
-Sell down of Northland NZ orchards releasing cash and securing supply
-Disciplined approach to debt – asset review
-Dividend maintained

5
Financial summary
Audited financial results FY18
NZDm
FY17 FY18 Change
Revenue 186.8 203.7 ↑ 9%
EBITDA¹ 23.1 26.2 ↑ 13%
Net profit after tax 5.8 7.4 ↑ 27%
1. EBITDA is earnings before interest, tax, depreciation, amortisation, impairments and revaluations.
191.3
186.8
203.7
201620172018
24.8
23.1
26.2
201620172018
EBITDA

NZDm


Revenue

NZDm

6
Earnings, net debt, net asset backing and dividends
37c Earnings per share
47
32
37
65
201620172018

1. In accordance with IAS, 2017 EPS was restated from the previously reported result due to December 2018 rights issue
¹
2. 2016 Normalised EPS excludes $4.1m ($3.1m after tax)
of insurance proceeds which reduces EPS to $0.47.
3. In 2017 a $1m prior period deferred tax adjustment was
expensed. Impairments less revaluation gains resulted in
a further $0.3m reduction.
NZD
FY17 FY18
Earnings per share
1
32 c 37 c
Net debt (NZDm) 83.1 79.1
Total assets (NZDm) 222.0 269.8
Net tangible assets per share $ 5.18 $ 4.96
Full Year dividends $0.22 $0.24
Earnings per share

Cents


2 3

7
$116m
$142m
$191m
$187m
$204m
$11.3m
$13.9m
$24.8m
$23.1m
$26.2m
Higher kiwifruit volumes
Hayward green up 23% SunGold up 24%
21.4m
27.8m
32.4m
25.7m
31.4m
20142015201620172018
1. Includes insurance proceeds of $3.6m
2. Pcp is previous corresponding period to 31 December 2017
9% increase
in revenue on pcp
2

13% increase
in EBITDA on pcp
23% increase
in kiwifruit volumes
on pcp
Millions
of trays
1

8
Disciplined approach to debt
Seeka target: Between 1.5 and 2.5 times EBITDA
$83.1m
$79.1m
$53.2m
10.5
30.2
20.8
6.1
3.6
5.2
9.4
0.5
12.2
47.9
25.9
Dec
2017
Dec
2018
Adjusted
Dec 2018
Post
harvest
Orchards
Orchard
sales
Investment
sales
Northland Investment
Growth
investments
PP&E
Orchards
Other
Operating
cash flow
Dividends
Rights
issue
Shareholder
transactions
Orchard
sales
as cost
3x
Debt to
EBITDA
2x
Debt to
EBITDA
Cash flow 2018, NZDm

9
Four operating segments capture the value chain
Orchard operations, New Zealand
Growing kiwifruit, avocado and kiwiberry

Post harvest operations, New Zealand
Picking, packing and coolstoring fruit

Retail services, New Zealand
Marketing local and imported produce in NZ,
exports to Australia and around the world,
manufactures functional foods

Seeka Australia
Owns orchards and post harvest facilities
Orchard operations
$52.8m
Post harvest operations
$123.8m
Retail services
$11.5m
Seeka Australia
$14.9m
Revenue by operating segment FY2018¹


1. 31 December balance date

10
Operating segment performance
EBITDA (NZDm)
Post harvest operations 26.8 22.0 32.1
Orchard operations 5.6 6.4 3.4
Retail services 1.9 2.9 1.6
Seeka Australia 1.0 2.3 (0.1)
Other (10.6) (10.4) (10.8)
Total 24.8 23.1 26.2
FY16A FY17A FY18A
NZ KIWIFRUIT VOLUME
(Millions Class 1 & 2 trays)
32.4m 25.7m 31.4m

11
0m
50m
100m
150m
200m
250m
20132015201720192021202320252027
-New Zealand kiwifruit volumes
growing strongly and forecast to
continue
Strong global consumer demand
Seeka had 20% market share in
2018
Seeka benefits from higher volumes
-Export value of NZ avocados
growing strongly
Nearly doubled in the last 5 years
over the pcp
2

Seeka had 10% market share of
avocado handling and marketing in
2017/18

Avocados and Kiwifruit are forecast to grow
$100m invested in the last 5 years to handle increasing volumes

1. Zespri 5 Year Outlook, November 2017. Note in 2018, Zespri completed the first of its 5-year plan to sell 750 hectares of licences per year
2. New Zealand Avocado Annual Report 2018, p22




Green kiwifruit
Gold kiwifruit
New Zealand kiwifruit exports

Millions of class 1 trays¹
Zespri forecast Actual

12
-Seeka estimates it has over
80% market share of
Australian kiwifruit, and 90%
of Australian nashi
-Developing orchards with
more profitable crop type and
varieties
-53 hectares of kiwifruit and 30
hectares of pears in
development – includes new
variety hybrid pears
-Poised for volume and profit
growth over 5 years

Seeka’s Australian operations
Invested to grow volumes and margins

13
Seeka is a growth company
1987199219972002200720122017
$1.2m
$203.7m
2018
10 10 10 10
12 12 12
Mar 16Sep 16Mar 17Sep 17Mar 18Sep 18Mar 19
Increasing revenue
24 cents in the last 12 months

Delivering value to shareholders
Cash dividend

Cents per share¹
Revenue




1. Fully imputed

Expansion through product portfolio, geographical
reach and value chain

14
Latest announcements
Updated EBITDA guidance
-FY2019 to a range of between $36.5m to $37.5m, from the previous guidance of between
$27.5m and $28.5m. The increase is the result of:
-Northland Orchard sales process $4.2m
-Effect of accounting standard changes $5.6m

Seeka continues its heartland growth story
-Purchase of Aongatete Coolstores Limited for $25m will add EBITDA between $3.5m and $4.5m when
fully integrated
Analyst Briefing Pack and Credit Swiss Analysis available for more information
Contact:
-Michael Franks, Chief Executive Officer, michael.franks@seeka.co.nz +64 21 356 516
-Stuart McKinstry, Chief Financial Officer, stuart.mckinstry@seeka.co.nz +64 21 221 5583
-Nicola Neilson, Group Financial Accountant, nicola.neilson@seeka.co.nz +64 7 573 0303

---

Seeka Limited

Investor presentation – April 2019

2
Our Business
Delivering orchard-to-market excellence
In Australia
-Grow, process and market
Kiwifruit
Nashi pears
European pears


In New Zealand
-Grow, process and market
1

Kiwifruit
2

Avocado
Kiwiberry
-Develop, lease and manage orchards
-Manufacture
Kiwi Crush, avocado oil
-Import, ripen and supply
Bananas, tropical fruit
-Wholesale
Seasonal produce

Largest grower of
kiwifruit in New Zealand
and Australia
Australia’s largest
nashi grower
1. Seeka also processes citrus and berries
2. NZ kiwifruit is predominantly marketed by Zespri

3
An investment entry point to New Zealand kiwifruit and avocados
-Geographical reach
-Integrated service from orchard to retail
-Major supplier of NZ kiwifruit to Zespri
2
Significant orchard and produce business in Australia (including kiwifruit)

3
Capital already invested to increase supply and fruit handling capacity

4
A premium produce company
-Major varieties Kiwifruit, Avocados, Nashi and European Pears
1
Seeka’s key investment attributes
Positioned for further growth

5

4
Highlights
Financial year ending 31 December 2018 - audited


1. Yet to settle $9.8m of the purchase
Financial
-$203.7m total revenue
-$26.2m EBITDA
-$7.4m profit after tax
-$0.37 earnings per share
New Zealand Kiwifruit volumes up
-31.4m trays of New Zealand kiwifruit harvested and packed – up 23% on pcp
Growth
-Acquired T&G Horticulture’s post harvest business and kiwifruit orchards for $42.1m¹ in 2018
-Developing Australian orchards
-Investing in New Zealand post-harvest infrastructure
-Purchase of Aongatete Coolstores Limited in 2019 for $25m
Recapitalised
-Fully-subscribed rights issue raised $47.9m in 2018
-Sell down of Northland NZ orchards releasing cash and securing supply
-Disciplined approach to debt – asset review
-Dividend maintained

5
Financial summary
Audited financial results FY18
NZDm
FY17 FY18 Change
Revenue 186.8 203.7 ↑ 9%
EBITDA¹ 23.1 26.2 ↑ 13%
Net profit after tax 5.8 7.4 ↑ 27%
1. EBITDA is earnings before interest, tax, depreciation, amortisation, impairments and revaluations.
191.3
186.8
203.7
201620172018
24.8
23.1
26.2
201620172018
EBITDA

NZDm


Revenue

NZDm

6
Earnings, net debt, net asset backing and dividends
37c Earnings per share
47
32
37
65
201620172018

1. In accordance with IAS, 2017 EPS was restated from the previously reported result due to December 2018 rights issue
¹
2. 2016 Normalised EPS excludes $4.1m ($3.1m after tax)
of insurance proceeds which reduces EPS to $0.47.
3. In 2017 a $1m prior period deferred tax adjustment was
expensed. Impairments less revaluation gains resulted in
a further $0.3m reduction.
NZD
FY17 FY18
Earnings per share
1
32 c 37 c
Net debt (NZDm) 83.1 79.1
Total assets (NZDm) 222.0 269.8
Net tangible assets per share $ 5.18 $ 4.96
Full Year dividends $0.22 $0.24
Earnings per share

Cents


2 3

7
$116m
$142m
$191m
$187m
$204m
$11.3m
$13.9m
$24.8m
$23.1m
$26.2m
Higher kiwifruit volumes
Hayward green up 23% SunGold up 24%
21.4m
27.8m
32.4m
25.7m
31.4m
20142015201620172018
1. Includes insurance proceeds of $3.6m
2. Pcp is previous corresponding period to 31 December 2017
9% increase
in revenue on pcp
2

13% increase
in EBITDA on pcp
23% increase
in kiwifruit volumes
on pcp
Millions
of trays
1

8
Disciplined approach to debt
Seeka target: Between 1.5 and 2.5 times EBITDA
$83.1m
$79.1m
$53.2m
10.5
30.2
20.8
6.1
3.6
5.2
9.4
0.5
12.2
47.9
25.9
Dec
2017
Dec
2018
Adjusted
Dec 2018
Post
harvest
Orchards
Orchard
sales
Investment
sales
Northland Investment
Growth
investments
PP&E
Orchards
Other
Operating
cash flow
Dividends
Rights
issue
Shareholder
transactions
Orchard
sales
as cost
3x
Debt to
EBITDA
2x
Debt to
EBITDA
Cash flow 2018, NZDm

9
Company Overview

10
Four operating segments capture the value chain
Orchard operations, New Zealand
Growing kiwifruit, avocado and kiwiberry

Post harvest operations, New Zealand
Picking, packing and coolstoring fruit

Retail services, New Zealand
Marketing local and imported produce in NZ,
exports to Australia and around the world,
manufactures functional foods

Seeka Australia
Owns orchards and post harvest facilities
Orchard operations
$52.8m
Post harvest operations
$123.8m
Retail services
$11.5m
Seeka Australia
$14.9m
Revenue by operating segment FY2018¹


1. 31 December balance date

11
Revenue
( NZDm )
FY16A FY17A FY18A
Post harvest operations 110.8 96.7 123.8
Orchard operations 47.9 48.6 52.8
Retail services 16.8 24.3 11.5
Seeka Australia 15.2 16.5 14.9
Other 0.6 0.7 0.7
Total 191.3 186.8 203.7
Kiwifruit Avocado

Kiwiberry Total
Contract supply 1,696 317 10 2,023
Managed 436 43 2 481
Orchard lease 393 7 4 404
Long term lease 46 25 - 71
Total 2,571 392 16 2,979
New Zealand orchard supply arrangements
Producing hectares harvest 2018¹


Production 205
In development 83
Undeveloped land 278
Total 566
Seeka Australia owned orchards and land
Hectares, FY18 (all fruit)


EBIDTA
( NZDm )
FY16A FY17A FY18A
Post harvest operations 26.8 22.0 32.1
Orchard operations 5.6 6.4 3.4
Retail services 1.9 2.9 1.6
Seeka Australia 1.0 2.3 (0.1)
Other (10.6) (10.4) (10.8)
Total 24.8 23.1 26.2
Segment performance summary


1. Kiwifruit harvest runs March to June, avocado August to February, and kiwiberry February to March

12
NZDm
2017 2018
Turnover / revenue
$ 48.6 $ 52.8
EBITDA
$ 6.4 $ 3.4
Millions of trays¹
Hayward (green) 5.9 7.6
SunGold 2.6 3.1
Total 8.5 10.7
̵$3.4m EBITDA
̵Down 46% on pcp
̵End of long term orchard leases
̵Recovery in Hayward yields
̵SunGold progressing to full
production
̵Investing in new long term leases
̵10.7m trays kiwifruit grown
(37.9m kilograms)¹
̵0.0390m trays avocado
(0.21m kilograms)
Orchard operations
Growing 36% of kiwifruit supplied to post harvest

1. Kiwifruit volumes exclude crop from T&G acquisition orchards, acquired crop off.
5.9
7.6
2.6
3.1
8.5
10.7
20172018
NZ kiwifruit grown
Millions of class 1 trays
Hayward
SunGold
Growing kiwifruit, avocado and kiwiberry
•Operate over 220 orchards via management, lease and long
term lease contracts

13
̵$32.1m EBITDA
̵Up 46% on FY17
̵31.4m kiwifruit trays processed
̵Up 23%
̵Coolstorage fruit loss
̵SunGold - 0.78%
̵SunGold organic - 0.17%
̵Hayward - 3.73%
̵Hayward organic - 1.09%
̵T&G Kerikeri post harvest facility
̵Acquired and integrated April 2018
Post harvest operations
Generating 61% of Group revenue
NZDm
2017 2018
Turnover / revenue
$ 96.7 $ 123.8
EBITDA
$ 22.0 $ 32.1
Millions of trays
Hayward (green) class1 15.6 19.2
SunGold class 1 8.7 10.8
Class 2 and other 1.4 1.4
Total 25.7 31.4
15.6
19.2
8.7
10.8
25.7
31.4
20172018
NZ kiwifruit processed
Millions of trays
Hayward
SunGold
Class 2
Processing service to harvest, pack, coolstore and
supply kiwifruit, avocado and kiwiberry
•Processes fruit from over 700 orchards including Seeka’s
managed orchards and independent growers

14
̵$1.6m EBITDA
̵Down 44% on FY17
̵Tropical business performed below
FY17
̵Avocado sales performed well in a
challenging year
̵New phytosanitary protocols
agreed with Australia
̵China market opened FY18
̵Delicious Nutritious Food Company
increased earnings to $0.46m
̵Up 58% on FY17

Retail services operations
Capturing value from fruit retailing and processing
NZDm
2017 2018
Turnover $ 54.2 $ 39.9
Revenue $ 24.3 $ 11.5
EBITDA $ 2.9 $ 1.6
Markets produce from Group operations plus
imports and processes tropical fruits
•Sell avocados under Seeka brand
•Market New Zealand kiwifruit in Australasia and work under
collaborative marketing agreement with Zespri to market
kiwifruit in Asia
•Import and ripen bananas and other tropical fruits
•Operate a wholesale fruit and vegetable market
•Delicious Nutritious Food Company manufacture and market
Kiwi Crush products, avocado oil and packing and
distributing kiwiberry

15
2,982
1,201
854
727
2,570
1,250
1,138
690
KiwifruitNashiPackhamOther
20172018
̵$(0.1)m EBITDA
̵Down 103% on FY17
̵Challenging growing season
̵Australian management
restructured
̵Psa-V detected October 2018 on 4.5
hectares of developing orchards
̵Containment strategy
̵$500k impact
̵Revised variety development plan
̵Delays full production by 12+
months
̵Investing in new orchards
̵83 hectares in development
̵40% increase in productive land
Australian operations
Integrated from orchard to market
NZDm
2017 2018
Turnover / revenue
$ 16.5 $ 14.9
EBITDA $ 2.3 $(0.1)
Australian-grown fruit

Tonnes


The largest grower and supplier of Australian kiwifruit
and nashi pears
•Nine large orchards, packs, markets and grow kiwifruit and nashi,
as well as European pears, apricots, plums and cherries

16
Industry Outlook

17
0m
50m
100m
150m
200m
250m
20132015201720192021202320252027
-New Zealand kiwifruit volumes
growing strongly and forecast to
continue
̵Strong global consumer demand
̵Growth includes using plant variety
right protected fruit such as SunGold
(gold) which commands premium
pricing and a better market mix over
green kiwifruit
̵NZ kiwifruit export value in 2017 $2.1b,
forecast to grow to $4.5b in 2025¹
̵Seeka had 20% market share in 2018
̵Seeka benefits from higher volumes
̵$100m invested in the last 5 years to
handle increasing volumes

The supply of kiwifruit is growing

1. Zespri Annual Review 2017/18, 2013 - 2017 data, p17; 2025 target, p3
2. Zespri 5 Year Outlook, November 2017. Note in 2018, Zespri completed the first of its 5-year plan to sell 750 hectares of licences per year



Green kiwifruit
Gold kiwifruit
New Zealand kiwifruit exports

Millions of class 1 trays²
Zespri forecast Actual

18
̵Export value of NZ avocados
growing strongly
̵Nearly doubled in the last 5 years
over the pcp
¹

̵Seeka had 10% market share of
avocado handling and marketing
in 2017/18
̵Seeka exports mainly to the high-
returning markets, including
Australia, South Korea and China
̵Seeka positioned to benefit from
larger avocado volumes with
three packhouses capable of
handling avocados


Avocados are an emerging fruit for Seeka
Seeka is capturing value in new markets


1. New Zealand Avocado Annual Report 2018, p22

19
-Poised for volume and profit
growth over 5 years
-Developing orchards with
more profitable crop type and
varieties
-53 hectares of kiwifruit and 30
hectares of pears in
development – includes new
variety hybrid pears
-2,655 mega litres of high and
low reliability water shares
-Upgraded onsite packing and
coolstore facilities to handle
growth

Seeka’s Australian operations
Invested to grow volumes and margins

20
Latest announcements
Updated EBITDA guidance
-FY2019 to a range of between $36.5m to $37.5m, from the previous guidance of between
$27.5m and $28.5m. The increase is the result of:
-Northland Orchard sales process $4.2m
-Effect of accounting standard changes $5.6m

Seeka continues its heartland growth story
-Purchase of Aongatete Coolstores Limited for $25m will add EBITDA between $3.5m and $4.5m when
fully integrated
Analyst Briefing Pack and Credit Swiss Analysis available for more information
Contact:
-Michael Franks, Chief Executive Officer, michael.franks@seeka.co.nz +64 21 356 516
-Stuart McKinstry, Chief Financial Officer, stuart.mckinstry@seeka.co.nz +64 21 221 5583
-Nicola Neilson, Group Financial Accountant, nicola.neilson@seeka.co.nz +64 7 573 0303