Boundary Bend Limited AGM 25 October 2019€¦ · 25/10/2019 · Cobram Estate EVOO Gross sales...
Transcript of Boundary Bend Limited AGM 25 October 2019€¦ · 25/10/2019 · Cobram Estate EVOO Gross sales...
Boundary Bend Limited AGM 25 October 2019
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OUR EXTRA VIRGIN OLIVE OIL BRANDS
AUSTRALIA USA
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OUR WELLNESS BRANDS
AUSTRALIA USA
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HIGHLIGHTS CONT. – STRONG BRANDED SALES GROWTH
5Source: Company data. Note sales net of Customer Promotions and Trading Terms.
$0
$20,000,000
$40,000,000
$60,000,000
$80,000,000
$100,000,000
$120,000,000
FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19
Oil Sales Evolution$ (AUD) sales evolution by product/brand
Cobram Estate Red Island Private Label Bulk
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10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
4.00
6.00
8.00
10.00
12.00
14.00
16.00
MAT To 07/10/12 MAT To 06/10/13 MAT To 05/10/14 MAT To 11/10/15 MAT To 09/10/16 MAT To 08/10/17 MAT To 07/10/18 MAT To 06/10/19
AU
D $
’00
0
AU
D $
/ltr
Cobram Estate premium over imported olive oil & gross sales growthHistorical retail selling price per litre in Woolworths and Coles (AUD $/ltr)
Cobram Estate EVOO Gross sales Cobram Estate EVOO Imported Olive Oil
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HIGHLIGHTS CONT. – PRICE PREMIUM AUSTRALIA
Source: Aztec IRI Grocery scan data: Moving Annual Total (MAT) retail sales for 12 months to dates displayed.
Rolling 12 month average
premium 94.6%
Rolling 12 month average
premium 30.1%
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2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
FY16 FY17 FY18 FY19 FY20 YTD FY20B
USA Packaged Goods growth
Cobram Estate Private label
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HIGHLIGHTS CONT. – USA PACKAGED GOODS SALES
Source: Company data. Gross sales.
Key Points (all figures $USD)
• Packaged Goods sales for FY16 – FY19, plus FY20 YTD and FY20 Budget
• FY20 YTD Sales of $3.0M at 30 Sept vs. FY19 full year of $4.3M.
• Strong packaged goods sales following acceptance of new essentials range (below) by US retailers.
• Expectation that packaged goods sales will exceed FY20 Budget.
YTD Sept73% of prior full
year
FY20 BUDGET
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HIGHLIGHTS CONT. – WELLGROVE LAUNCH
Heart Health500mL - natural, mint
Immune Support500ml & 250mL – natural, berry, apple
60 capsules
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HIGHLIGHTS CONT. – FROST FANS
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HIGHLIGHTS CONT. – NEW GENERATION HARVESTER
Water usage
• Expected usage of 35,351ML in FY20; and
• Significant increase in cost due to increase in water price over period.
• Current price – ~$950 on Vic Murray z7. (Boundary Bend and Wemen)
– ~$560 on Goulburn z1A (Boort)
0
100
200
300
400
500
600
700
800
900
Mo
nth
ly M
edia
n $
/ML
Water Trading History - Vic Murray Zone 7
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KEY CHALLENGES – WATER MARKET
Source: Victorian Water Register as at 1 July 2009 - 6 October 2019
Volume (ML) Cost ($’000) $/ML
FY14 41,059 3,146 77
FY15 38,172 4,677 123
FY16 39,927 9,881 247
FY17 32,995 2,603 79
FY18 31,155 3,720 119
FY19 34,547 16,072 465
FY20 YTD 4,002 3,030 757
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KEY CHALLENGES – WATER MARKET CONT.
UNDERSTANDING WATER AND BOUNDARY BEND’S PARTICIPATION IN THIS MARKET
Tradable Water rights usually exist in two different forms:
• Permanent Entitlement Water (Permanent Water) - which can be thought of as a “right” to an ongoing share of water in the Murray Darling Basin (MBD). This right is held in perpetuity and is officially called “Entitlement Water”. Permanent Water cannot be used for irrigation, only the Temporary Water that has been allocated from Entitlement Water is available for irrigating crops.
• Temporary Allocation Water (Temp Water) - is the allowable volume of water that may be used by irrigators in a particular irrigation season, which is determined by authorities based on how much water is available in storage dams. Temp Water is officially called Allocation Water and it expires each year. It is simply a temporary allocation from a permanent entitlement for that year (irrigation season 1 July to 30 June) and has historically been based on a “use it or lose it” concept. The amount of temporary allocation against a permanent entitlement will change due to rainfall, the amount of water in storages, and weather outlook.
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KEY CHALLENGES – WATER MARKET CONT.
UNDERSTANDING WATER AND BOUNDARY BEND’S PARTICIPATION IN THIS MARKET (cont.)
Unbundling – Water from Land
• To be clear, both Permanent Water and Temporary Water is not tied to land. Subject to delivery rules, Irrigators can and do purchase Temporary Water from other holders located across the Southern Murray Darling Basin (sMDB) for use at their properties.
Current permanent entitlement allocation (in our irrigation zones) is between 40% and 50% due to lower storage levels and lower seasonal inflows (rainfall).
Due to the above, every irrigator (even those who own permanent entitlements) will need to purchase temporary water on market to fulfill needs for the current irrigation season.
THE PROBLEM
While it can be expected that temporary water will be more expensive during drought, irrigators have two key concerns:
• That the temp water price is being amplified by the presence of water traders in the market, and the commercial behaviour of some of these water speculators and some water brokers. Both are incentivised by high water prices, and their preferred market outcomes are the opposite of irrigators, who need affordable water for production.
• That recent changes to trading rules combined with increasing compliance demands on irrigators to buy earlier in the season have materially distorted normal market supply and demand balance, to the serious disadvantage and detriment of irrigators.
These concerns are threatening the viability of businesses and communities reliant on irrigated food and fibre production.
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KEY CHALLENGES – WATER MARKET CONT.
THE PROBLEM (cont.)
As an example, of what is happening, one water investor purchased 140GL of Temporary Allocation Water in FY19.
The put this volume in context:
• 140GL is approximately 40% of South Australia’s entire annual irrigation water use
• All Lower Murray Water districts combined (Mildura, Red cliffs and Irymple) use approximately 94GL per year
FACT FINDING….
The Federal Govt has initiated:
1. The ACCC enquiry which has wide terms of refence and discovery powers.https://www.accc.gov.au/focus-areas/inquiries-ongoing/murray-darling-basin-w
2. A Senate Select committee into Water https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Management_and_Execution_of_the_Murray_Darling_Basin_Plan
Both these reviews do not hand down final reports until November 2020. 16
KEY CHALLENGES – WATER MARKET CONT.
IRRIGATORS - PROPOSED SHORT TERM SOLUTION
Currently, irrigators are lobbying all levels of Government for interim solutions to free up the temp allocation market. These include:
• Only irrigators can purchase temporary water allocations – anyone who is not an irrigator with direct consumptive use or does not have a pre-existing existing bona fide supply contract to an irrigator for consumptive use – to be prevented from purchasing any temporary water Allocations in the sMDB.
• Only irrigators can carryover unused water from one season to the next, subject to somemateriality/exclusions -eg carryover volume cannot be higher than their annual direct consumptive use (using 3 year average direct consumptive water use) and cannot be sold or loaned to another party for their use.
To protect against any unintended consequences, hardship or pre-existing contractual arrangements, carryover measures only relate to parties and persons (including related parties) where cumulative annual temporary water Allocations reach say 2GL OR $2m (whichever is triggered first). The relevant government Ministers can vary the above limits using their discretion on a case-by-case basis should there be any unintended consequences. 17
KEY CHALLENGES – WATER MARKET CONT.
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KEY CHALLENGES - WATER IMPLICATIONS
Boundary Bend continues to source all water on temporary ‘spot’ market.
• Cumulative (six year) average water price to FY19 was $184/ML
• Current water price is ~$950/ML on Zone 7 (Murray) and ~$560/ML on Zone 1A (Goulburn)
• Boundary Bend have a budgeted weighted average water price of $500/ML.
The present water situation is a high priority for the business. A $100/ML increase = additional $3.6M cost. Just this week water prices rose approximately $150/ML in Zone 7.
Boundary Bend recognise that prudent planning and decision making will be required to curtail the impact of the high temporary water prices, particularly that no-one knows when the drought will break. These include:
• Reduction in water use above a certain price (season, crop, tree age and climate dependant)
• Tighter capital/cost management
• Raised an additional $20m in debt facility with CBA
• Potential EVOO retail price rise
SUSPEND DIVIDEND
Given the current water price and volatility, it would be irresponsible to declare a dividend at this time and unfortunately it is not our intention to pay a dividend in the FY20 year.
As an aside
Boundary Bend are however in a very fortunate position relatively as olive trees are hardy and can survive a lack of water, unlikely other permanent (irrigated) crops that cannot survive without water.
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KEY CHALLENGES – WATER IMPLICATIONS CONT.
• Profit primarily driven by significant higher crop – 13.1m litres, compared to 5.4m litres in FY18.
• Result incudes impact of water price ($9.5m more than long term average)
• Included in this result is a continued investment in our four core growth strategies.
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REPORTED PROFIT AND LOSS
Year ending 30 June FY18
($‘000)FY19
($‘000)
Profit / (loss) before tax (13,132) 16,648
Income tax expense (144) (7,889)
Profit / (loss) after income tax expense (13,276) 8,759
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UNDERLYING EBITDA
Over the last four years, we have incurred significant expense from investing in our core growth strategies
FY16($‘000)
FY17($’000)
FY18($’000)
FY19($’000)
Reported EBITDA 13,555 35,190 1,699 33,249
Investment in USA and BB Wellness 9,000 11,300 10,371 9,317
Core Australian business EBITDA 22,555 46,490 12,070 42,566
Over the last four years, average core Australian business EBITDA of over $30m.
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OPERATING CASH FLOW and UNDERLYING OPERATING CASH FLOW
We have invested significantly in core growth strategies
FY16($‘000)
FY17($’000)
FY18($’000)
FY19($’000)
Operating Cash Flow (reported) 16,470 15,821 18,801 121
add-back impact of new business units
Operating cash outflow (Value-add & by-products) 699 2,250 3,835 5,405
Operating cash outflow (USA business) 6,560 7,930 8,796 6,998
7,259 10,180 12,631 12,403
Operating Cash Flow – core Australian business 23,729 26,001 31,432 12,524
Reported operating cashflow in FY19 adversely impacted by;
• Price of water
• Launch costs of Wellgrove
• New packaged good launch in the USA (Cobram Estate Essentials range)
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OPERATING CASH FLOW & USE OF FUNDS
We have invested significantly in core growth strategies
* Average annual numbers (FY17, FY18 and FY19)
Equity raised (options & DRP) (p.a.),
$10.2m
Net increase in borrowings
(p.a.), $11.1m
Operating cashflow before interest (p.a.),
$15.7m
Cash from operating, borrowing and new equity (3yr average)
Interest costs (p.a.),
$4.2m
Capex projects (p.a.),
$27.3m
Other (p.a.), $0.2m
Dividends paid (p.a.),
$5.7m
Use of cash (3yr average)
• To 30 September 2019 our trading profit is in-line with budget
• Australian packaged good sales for the 3 months to 30 September:• Sales approximately 13% ahead of budget
• Solid performance through our main retail accounts
• USA packaged good sales for the 3 months to 30 September:• Sales of US$3.06M. This compares to US$4.3m in the 12 months to 30 June 2019
• More on USA sales later in the presentation
• Costs in line with budget, although current water prices continue to rise and are around $300/ML* higher than budget.
* Based on current weighted temporary water price for olive grove supply from Murray zone 7 and Goulburn zone 1A. 24
AUSTRALIAN BUSINESS - OPERATIONAL UPDATE
Unaudited trading update
• Due to the biennial bearing nature of the olive tree, and the current water situation, we feel that providing a one-year profit forecast would likely provide a misleading picture of future performance.
• Providing a forecast over a longer period is much more reliable considering the biennial bearing crop.
• Subject to water prices, we are budgeting an average EBITDA for the core Australian business of around $46m (average of FY20 and FY21), compared to an $27.3m average in FY18/FY19. The increase is predominately driven by:• Maturing groves, with 40.1% of our grove area not yet producing oil, and a further 19.5%
not yet mature
• Frost impact in FY2018
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FUTURE EARNINGS
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ORGANIC GROWTH
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4
6
8
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12
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200
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600
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1,000
1,200
1,400
1,600
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19
Hec
tare
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Tree Age
Total planted hectares & yield profile(Total hectares 6,591 – all freehold)
Hectare age profile
Typical yield evolution (t/ha)
Source: Company data - as at 30 June 2019
Ton
/hec
tare
pro
du
ced
Not yet producing = 19.5% of grove
Trees not fully mature = 40.1% of grove area (2,643 ha)
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INDEPENDENT VALUATIONS
Carrying Value before
valuation increase
Independent Valuation
Valuation Increase/
(decrease)
Valuation Increase/
(decrease) recognised
Carrying Value after
Valuation Accounting Treatment
$'000 $'000 $'000 $'000 $'000 Australian groves - land & buildings 40,997 63,168 22,171 22,171 63,168 Fair value - irrigation 26,425 46,244 19,819 - 26,425 Cost - bearer plants (olive trees) 95,380 113,338 17,958 - 95,380 Cost
Sub-total 162,802 222,750 59,948 22,171 184,973 Geelong: bottling & storage facility 12,071 14,000 1,929 1,929 14,000 Fair value California: bottling, processing & storage facility 13,402 13,669 267 267 13,669 Fair value
Total 188,275 250,419 62,144 24,367 212,642
• Facilities provided by Commonwealth Bank of Australia (‘CBA’)
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BANK DEBT
At 30 June 2019 FACILITY UNUSED
Core Debt Facility AUD 58.0m -
Working Capital Facility AUD 55.0m AUD 9.0m
Foreign Currency Facility USD 10.5m -
Gearing 30 June 2018 30 June 2019
Net Debt / Tangible Assets 30.1% 34.2%
CBA have agreed to extend the above existing facilities by five years through to October 2024, and provide an additional $20M working capital facility with a two year tenor.
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50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
FY15 FY16 FY17 FY18 FY19
Total Tangible Assets vs. Bank Facility Limit
Total Tangible Assets CBA Facility Limit
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TOTAL TANGIBLE ASSETS vs. FACILITY LIMIT
Source: FY15 – FY19 company data from audited Financial Report. CBA facility limit includes Asset Finance limit.
Gearing:
31.1%
Key Points (all figures $’000 AUD)
• Total Tangible Asset values per audited Financial report
• Due to accounting standards, we don’t revalue Irrigation assets or Bearer Plants (olive trees) in our Balance Sheet, our policy is to account for them at historical cost (less depreciation).
• Both Irrigation assets and Bearer Plants are carried below valuation by:– Irrigation: $19.8M
– Bearer Plants: $17.9M
• Gearing in FY19 would be reduced to 31.9% if the balance sheet reflected the full valuation.
Gearing:
33.9%
Gearing:
36.0%
Gearing:
35.4%
Gearing:
35.4%
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20,000
40,000
60,000
80,000
100,000
120,000
140,000
Current Assets vs. Term DebtAt 30 June 2019 (AUD$'000)
Cash Debtors Oil & Packaged Goods Term Debt (drawn)
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CURRENT ASSETS vs. DRAWN DEBT
Source: FY19 Financial Report. Term debt excludes Asset Finance which funds Plant & Equipment.
Key Points:
• Current Assets excludes biological assets (trees).
• Term debt excludes Asset Finance.
• Current assets (cash, debtors and oil) covers 90% of Term Debt.
90.0%
Shares: 61.06m shares on issue
Assets of $402.5m
Cash, inventory, oil and receivables of $106.9m
Land & buildings, trees and irrigation $230.0m
Plant and equipment $46.6m
Intangibles $6.7m (mostly Cobram Estate and Red island trademarks)
Other $12.3m
Liabilities (excluding deferred tax) of $181.2m*
Bank loans of $119.0m (CBA)
Asset finance (leasing) of $19.0m
Creditors and other liabilities (current) of $26.2m
Other $17.0m31
BALANCE SHEET SUMMARY
Note: management estimate the cost to replace these tangible assets, including investing in the trees until they reach cashflow breakeven would be in excess of $550m ($9.00 share). This estimate does not attribute any value for the Cobram Estate and Red Island brands (net sales of $67.7m in FY19) nor does it deduct Boundary Bend’s liabilities, as at 30 June 2019.
* Reported liabilities per FY19 Financial Report are $222.8m. Above Liabilities excludes Deferred Tax Liability of $41.6m which is predominately a tax liability (capital gain) due if Boundary Bend was to dispose of land and grove assets.
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GROWTH STRATEGIES
FOUR CORE OPPORTUNITIES TO DRIVE FUTURE GROWTH
Increasing the farm-gate return for our Extra Virgin olive oils
Educating media, health professionals and consumers of the superior value of Cobram Estate.
Price increase to counter rising costs.
Building our vertically integrated business in the USA
Increasing yields from maturing existing orchards, together with incremental production from new plantings
Our trees are still maturing, and in addition we are still planting.
Value-adding by-products and waste streams
Undertaking research ,market development and sales
$/L
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BOORT REDEVELOPMENT1,660 HECTARES PLANTED IN LAST FOUR YEARS
Since Autumn 2016, 1,660 hectares or 53% of Boort Estate has been redeveloped:
• Autumn 2016 – 399 hectares
• Autumn 2017 – 331 hectares
• Autumn 2018 – 332 hectares
• Autumn 2019 – 598 hectares
We recently cleared ~450 hectares (~160,000 trees) in preparation for the 2020 redevelopment -
Once the 2020 development is complete, 68% of the Boort grove will be less than five years old.
BOORT ESTATE
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BOORT REDEVELOPMENT1,660 HECTARES PLANTED IN LAST FOUR YEARS
Planted Autumn 2018 Planted Autumn 2017 Planted Autumn 2016 Planted Autumn 2019
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HARVESTING R&D
We are currently undertaking significant R&D in respect to harvesting methods:• Working with the manufacturers of
the Colossus harvester to develop a new harvester, which may lead to:• Shorter harvest;• Increased fruit yield (i.e. less loss); and• Overall reduced cost;
• Durability of picking materials; and• Automation.
We recently purchased a specialisedolive harvester to harvest young trees.
RECAP ON LAST AGM
• A frost map was generated showing the areas most at risk from frost
• We now know:
1. Where the coldest areas are
2. Why they are the coldest areas
3. How to target specific areas for frost mitigation
Frost mapping initially conducted on an area known as TC3 (diagram to right).
FROST MITIGATION
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FROST MITIGATION - WHERE WE MEASURED
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Following the assessment of TC3, the entire Boundary Bend Estate was mapped, several frost prone areas were identified, and we have currently installed the following:• Blue circle: 47 fans - March 2019;• Green circle: 40 fans - August 2019; and• Orange circle: 29 fans - September 2019;
There is another 20 frost fans planned for March 2020 (red circles).
The frost fans cost the business ~$6.3M
TC3
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MARKETING AUSTRALIA
Growth Drivers
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How. • Researched communication
campaign and multi channel approach to motivate switching
• New product development including; • Meal Starter Range • Baking Range • Limited Edition Christmas
Oil
Grow the user base
• Increase household penetration by attracting new users;• Under 45 “foodie”• European oil consumer
• Cultivate long term brand loyalists
• Drive trial. If they try us, we win
• Freshness, quality story• Modernise the way we
present our brands
Increase usage occasions
• Lift current user purchase frequency
• Win greater share of total oil usage
• Use health messaging to increase use vs. OO in core consumption occasions
• Continue to grow awareness around high heat cooking
• Use NPD to drive multi SKU purchase
Continue to build a premium brand
• Focus the conversation on value, rather than price
• Engaging story telling around our unique offering;• Freshness• Quality• Better for you• Tree to table• Australian
-
10,000
20,000
30,000
40,000
50,000
60,000
70,000
Cobram Moro La Espanola WOW Private Label Red Island Squeaky Gate Coles Private Label Bertolli Dollevi Other
AU
D $
('0
00
)
Australian Retail - Extra Virgin Olive OilWoolworths and Coles Brand Share of EVOO - Last 12 months
Dollars (000s) Litres (000s) Units (000s)
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RETAIL SALES AUSTRALIA
33.7%
8.6%
Source: Aztec IRI Grocery scan data: Moving Annual Total (MAT) retail sales for 12 months to 6/10/19.
Significant opportunity; USA consumption currently 350 million litres with only 10 million litres sourced from domestically grown fruit.
Timing right to enter market regarding consumer awareness of EVOO, health and provenance movement.
Ability to leverage Australian IP, systems, know-how and people to execute our strategy.
Two harvests per annum, quicker improvements to harvesting and processing techniques, effective knowledge sharing.
We are more excited than ever about the opportunity and potential of our USA business and furthermore that our strategy is relatively low risk and likely highly rewarding in the medium term.
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USA EXPANSION
RECAP – WHY GO TO THE USA
Boundary Bend USA operates as a fully vertically integrated olive business with the following sites/functions:
• Fruit processing and oil storage at our Woodland facility has progressively expanded to cope with increasing fruit volumes and has just started its 5th harvest.
• The laboratory gained full American Oil Chemists Assoc. accreditation in May 2017.
• Fruit supply contracts with existing third-party growers, including technical advice and harvesting services where required.
• The current mill has capacity to process 15,000 tons of fruit. We will process close to this amount in the 2020 harvest.
• Bottling and packaging line fully operational.
• Sales – both bulk and branded strategy.
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USA EXPANSION
UPDATE ON VERTICALLY INTEGRATED USA BUSINESS
• Grove ownership – currently own/lease 542 acres, with contracts executed on another 500 acres of land for further plantings.
The key difference between Australia and the USA is that we are and will continue to be reliant on fruit supply from existing third-party olive growers. To date we have been delighted by the overwhelming support shown to us by Californian olive growers. Thanks to these growers, we are now the third largest producer of olive oil in the USA.
Paul Riordan (who founded Boundary bend with Rob and is Boundary Bend’s 2nd
largest shareholder), wife Fiona and their two boys Will and Angus, moved to live at Woodland, California, in July 2018. Paul is full time working in the USA business.
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USA EXPANSION
UPDATE ON VERTICALLY INTEGRATED USA BUSINESS (cont.)
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USA SALES
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5,000,000
10,000,000
15,000,000
20,000,000
25,000,000
30,000,000
FY16 FY17 FY18 FY19 FY20 YTD FY20B
US Sales Evolution
Bulk Private label Cobram Estate
Key Points (all figures $USD)
• Packaged Goods sales increased following the Cobram Estate Essentials range launch (more detail on following slide).
• Budgeting 12% sales increase primarily driven by packaged goods growth.
• Packaged goods sales budgeted to be three times FY19.
• Reduction in Bulk sales due:
– Increased oil directed to packaged goods due to Essentials range; and
– Reduction in bulk demand.
Source: Company data. Gross sales.
Three months tradingYTD Sept
-
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
FY16 FY17 FY18 FY19 FY20 YTD FY20B
Packaged Goods growth
Cobram Estate Private label
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USA PACKAGED GOODS SALES
Source: Company data. Gross sales.
Key Points (all figures $USD)
• Packaged Goods sales for FY16 – FY19, plus YTD and FY20 Budget
• Sales of $3.0M at 30 Sept vs. FY19 full year of $4.3M.
• Strong packaged goods sales following acceptance of new essentials range (below) by US retailers.
• Expectation that packaged goods sales will exceed FY20 Budget.
YTD Sept73% of prior year
FY20 BUDGET
MARKETING USA
Growth Drivers
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How. • Researched communication
campaign and multi channel approach to motivate switching
• New product development including; • Meal Starter Range • Baking Range • Limited Edition Christmas
Oil
Win at shelf
• Detailed account planning by retailer
• Maximize off-shelf display• Partner with retailers during
key promotion periods• Drive impulse purchase at
shelf with neck hanger offers
• In-store sampling
Leverage digital to drive retail
• Own the search bar across search engines and retail sites
• Create digital incentives to drive trial at shelf
• Launch remarketing campaigns to drive trial
• Encourage social sharing and product reviews
Grow brand trust and drive trial
• Drive trial on new Essentialsproduct line
• Continue to build consumer base for premium Select line
• Focus on PR, strategic brand partnerships and events
• Maximize our points of difference:• Freshness & quality• 100% California
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VALUE-ADDED PRODUCTS RECAP
• Our value-adding journey started in 2016.
• We have spent the last few years researching, developing and testing some unique, high quality ‘olive wellness’ products.
• We have recently executed a two-pronged sales strategy to commercialise new products as they become available:1. Specialty ingredient supply2. Branded retail sales focused initially on
Australia and the USA
• We continue to invest in R&D, with a number of our most exciting and most unique products still under development.
Fresh olives
Olive pit
Olive mill waste water
Olive pomace
Olive timber
Fresh olive
leaves
Capturing ‘Olive Goodness’Holistic use of our olive products
100% grown on Boundary Bend’s olive groves
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COMMERCIAL STRATEGY
B2B sales of olive ingredients to
pharmaceutical, cosmetic, food and
health food channels.
Specialty ingredients
Sales of branded ‘Olive Wellness’ products in the USA and Australia
initially. Target channels include pharmacy,
grocery, health food and online.
Sales of branded premium olive leaf teas
in Australia, Malaysia and USA/Canada initially through specialty food,
health food and premium grocery stores.
Wellgrove ‘Olive Wellness’ products
Stone & Grove Olive leaf teas
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INTRODUCING WELLGROVE
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WELLGROVE AUSTRALIAN LAUNCH RANGE – OLIVE LEAF EXTRACT
• Launched in April / May 2019.
• Made from fresh leaves from our Cobram Estate groves.
• Wellgrove Immune Support: Traditionally used in western herbal medicine to help support a healthy immune system and relieve symptoms of common colds and flu.
• Wellgrove Heart Health: An ‘Extra Strength’ olive leaf extract that helps keep cholesterol levels within a healthy range in the body and helps support overall healthy heart function.
Heart Health500mL - natural, mint
Immune Support500ml & 250mL – natural, berry, apple
60 capsules
WELLGROVE LAUNCH CUSTOMERS / CHANNELS
• Launched in May 2019.• Available in 400+ stores.
• Launched in May 2019.• Available in 800+ stores.
• Launched in May 2019.• Ranged nationally in key
distributor warehouses –API, Symbion, Sigma and CH2.
Pharmacy other
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AUSTRALIAN MARKETING LAUNCH
Advertising, digital & PR campaign Healthcare Professional Engagement+
Investing in our brand and olive wellness category education
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WELLGROVE USA LAUNCH RANGE – OLIVE LEAF EXTRACT
• Launched in June 2019.
• Made from fresh leaves at our Boundary Bend grove.
• Wellgrove Super Immunity.
• Wellgrove Super Immunity plus Heart Health.
Super Immunity + Heart Health500mL & 120ct
Super Immunity500ml & 250mL
1. Direct to Consumer Website2. Amazon.com
Direct to consumer websiteWellgrovehealth.com
WELLGROVE USA LAUNCH SALES CHANNELS
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STONE AND GROVE OLIVE LEAF TEAS
• A craft brand of premium teas.
• Created from leftover olive leaves, collected
fresh and packed in simple, stylish,
recyclable packaging, pyramid tea bags.
• Released in November 2018, initially sold
through speciality olive oil and vinegar
stores in the USA.
• Distribution expanded to included Malaysia
and speciality food stores in Australia.
• Online store live.
56
INTRODUCING OUR TEAS TO THE WORLD
57
NEW NON-EXECUTIVE DIRECTOR APPOINTMENT
ALAN HILBURG
Communications and branding consultant.
Alan has also worked in various industries including transportation, hospitality, environmental industries, chemical, healthcare and education sectors.
Alan has over 30 years of experience as a communications strategist consultant, and has also written to two New York Times best selling books and produced several documentaries.
https://en.wikipedia.org/wiki/Alan_Hilburg
58
THANKS > TO FORMAL PROCEEDINGS
59
Resolution 1Approve the financial statements and the reports
Direct / ProxyVotes
% of totalshare on
issue
For 17,046,355 27.9%
Against - -
Abstain - -
Resolution approved
60
Resolution 2(a)Re-election of Mr Leandro Ravetti
Direct / ProxyVotes
% of totalshare on
issue
For 17,046,355 27.9%
Against - -
Abstain - -
Resolution approved
61
Resolution 2(b)Re-election of Mr Tim Jonas
Direct / ProxyVotes
% of totalshare on
issue
For 17,046,355 27.9%
Against - -
Abstain - -
Resolution approved
62
Resolution 3Adopt the Remuneration Report
Direct / ProxyVotes *
% of totalshare on
issue
For 1,553,538 2.54%
Against - -
Abstain 3,305 0.0%
* This excludes any proxy votes from Executive Directors or senior management referred to in the Remuneration Report
Resolution approved
63
Resolution 4Approving the non-executive Director fees cap
Direct / ProxyVotes *
% of totalshare on
issue
For 16,699,936 27.4%
Against 2,216 0.0%
Abstain 10,000 0.0%
* This excludes any proxy votes from non-Executive Directors
Resolution approved
64
THANKS