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Agria Corporation (NYSE:GRO)Investor presentationApril 2012
Agria is: An International Agriculture Company. Operating 3 Businesses: International Seeds China Seeds and Operating 3...
Agria’s 3 Operating BusinessChina Seeds• Edible corn seed, field corn seedand vegetable seedsInternational Seeds• Leading ...
International Seeds – Financial OverviewYear ended 30 Jun 2010 Year ended 30 June 2011NZD million USD million NZD million ...
China Seeds – Financial OverviewYear ended 31 Dec 2010 (audited) 6 months ended 30 June 2011( )(unaudited)RMB million USD ...
Agriservices – Financial OverviewYear ended 30 Jun 2010 Year ended 30 June 2011NZD million USD million NZD million USD mil...
International Seeds Division
International Seeds StructureCorporateNZ AustraliaSouthAmericaInternational R & D ProductionTurfContractgrowersJointventur...
Market Leader in Temperate Forage SeedsMarket Leader in Temperate Forage SeedsKey features Business unit revenue (FY10)13%...
Extensive Product Portfolio Caters to a Range ofExtensive Product Portfolio Caters to a Range ofPastoral Requirements and ...
Cl M k t L d i N Z l d F S dClear Market Leader in New Zealand Forage SeedKey features New Zealand processing and distribu...
#1 Market Position in Australian Forage Seeds#1 Market Position in Australian Forage SeedsKey features c 40% market share...
Leading Provider of Turf Seeds to Stadia and SportsClubsKey features Supplies turf for stadia sports clubs and golfAustra...
Expanding Presence in South AmericaExpanding Presence in South AmericaKey features South American sitesMontevideoWrightson...
Leading New Zealand Grain Trader and Arable SeedS liSupplier…Key features Customers New Zealand’s largest grain brokerage...
China Seeds Division
St t i R h & D l t P t hiStrategic Research & Development Partnerships• China National Academy of Agricultural Sciences– E...
Attractive Commercial Product PortfolioAttractive Commercial Product Portfolio• Edible corn seeds - sticky– North China ma...
Strong Relationships with the Chinese GovernmentStrong Relationships with the Chinese Government• Government grantGovernme...
Agriservices division
Compelling Portfolio of Complimentary Businesses,Primarily Serving New Zealand FarmersRural Supplies 91 rural supply store...
R l S liRural SuppliesKey features• Provider of goods and services to the rural sector • Approximately 40,000 customer acc...
F itifi d S liFruitified SuppliesKey features Customers• Leading horticulture service and supply business, providinggrower...
LivestockLivestockKey features Customers• Sales agent for sheep, beef, dairy and deer farmers, meatprocessors and livestoc...
Large and Growing South American Presence• PGW established a presence in the stock and station sectorthrough the acquisiti...
PGW Holding Structure and Results
Agria Asia and PGW - StructureAgria Corporation Ngai TahuNew Hope80.81% 11.95% 7.24%Agria AsiaAgria Singapore100%NZ$34mCon...
Our Diverse Strategic Investment Partners Are Able toH l D i th S f PGG W i ht d E lHelp Drive the Success of PGG Wrightso...
Collaborating to Further Enhance PerformanceCollaborating to Further Enhance Performance• Representative office for PGG Wr...
PGW Full Year ResultsYear ended 30 Jun 2010 Year ended 30 June 2011NZD million USD million NZD million USD millionRevenue-...
PGW Interim Results6 mths ended 31 Dec 2010 6 mths ended 31 Dec 2011 ChangeNZD million USD million NZD million USD million...
Central Overhead and Balance Sheet Overview
Agria’s Central Costs• Six months to 30 June 2011– As reported in the transition 20F for the 6 months period ended 30 June...
Balance Sheet Overview30 June 2011RMB million USD millionCurrent assets- Cash and equivalents 94 15Cash and equivalents 94...
Agria’s Mission Statement“T b th t l i t ti l i lt“To be the truly international agriculture companybased in China”- Abili...
Agria Corporation (NYSE:GRO)Investor presentationApril 2012
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Agria investor presentation apr 2012 web final

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Agria investor presentation apr 2012 web final

  1. 1. Agria Corporation (NYSE:GRO)Investor presentationApril 2012
  2. 2. Agria is: An International Agriculture Company. Operating 3 Businesses: International Seeds China Seeds and Operating 3 Businesses: International Seeds, China Seeds andAgriservices. Helping farmers increase productivity through innovativeHelping farmers increase productivity through innovativeagricultural best practices and advanced technologies. Exploiting international agricultural trade opportunities betweenExploiting international agricultural trade opportunities betweenChina and global markets, including New Zealand, Australiaand South America. A publicly traded company listed on the New York StockExchange (NYSE) under ticker GRO.
  3. 3. Agria’s 3 Operating BusinessChina Seeds• Edible corn seed, field corn seedand vegetable seedsInternational Seeds• Leading seeds supplier in thesouthern hemisphereAgriservices• New Zealand’s pre-eminent ruralservices business facilitatingpurchase of major inputs and sale of• Strong R&D capabilities includingpartnership with China Academy ofAgricultural Sciences (CAAS)• Proprietary rights to market leadingvariety of ‘sticky’ edible corn seed• New Zealand 60% forage seedmarket share• Australia 40% forage seed marketsharepurchase of major inputs and sale ofmajor outputs for NZ farmers• Key inputs sold includeagrichemicals, feed and seeds boththrough on-farm salesi d i idvariety of sticky edible corn seedand best new variety of field cornseeds• Sales to large scale farmers, foodmanufacturers and distributors in 30provinces in China• South America growing marketshare• Portfolio of grasses, legumes,brassicas and herbs seeds• Unique and defendable IP tailoredrepresentatives and a nationwidechain of over 100 retail stores• Leading livestock broker withnational network of sales agents andyards for sheep, beef, dairy and deerprovinces in China• Production bases in Gansu andXinjiang provinces• Turnover RMB 61 million; operatingprofit RMB 20 million for six months• Unique and defendable IP tailoredto specific climates• Globally leading R&D both in-houseand through nine partnerships withresearch institutes in five countriesfarmers, processors andimporters/exporters• Procurement, freight, sales andexport of New Zealand WoolAdditi l i t fpended June 2011 • Also incorporates grain and animalnutrition businesses• Turnover NZD 420 million;operating profit NZD35 million for 12months ended June 2011 (note 1)• Additional services to farmersincluding irrigation and pumpingsolutions, real estate agents,agriculture training provision• Turnover NZD 821 million;months ended June 2011 (note 1)operating profit NZD 26 million for 12months ended June 2011 (note 1)Note 1: Financials for international seeds and Agriservices sourced from PGW annual accounts. Agria only consolidated these businesses from 30 April 2011.
  4. 4. International Seeds – Financial OverviewYear ended 30 Jun 2010 Year ended 30 June 2011NZD million USD million NZD million USD millionRevenue- Seeds and grain 255 209 268 220- Agrifeeds 44 36 56 46- South America 85 70 96 79- Total 385 316 420 344EBITDAEBITDA- Seeds and grain 32 26 28 23- Agrifeeds 5 4 5 4- South America 4 3 4 3T t l 41 34 38 31- Total 41 34 38 31Operating profits 38 31 35 29Notes:1. The NZD results are extracted from PGG Wrightson’s filings.2. Agria started consolidating PGG Wrightson following completion of the partial offer in April 2011, therefore the results prior to thatdate do not appear in Agria’s results3. USD figures are provided for reference only and are translated at exchange rate of NZD 1: USD 0.82
  5. 5. China Seeds – Financial OverviewYear ended 31 Dec 2010 (audited) 6 months ended 30 June 2011( )(unaudited)RMB million USD million RMB million USD millionRevenue- Edible corn seeds 29 4.4 27 4.1- Field corn seeds - - 34 5.3- Total 29 4.4 61 9.4Gross profit- Edible corn seeds 12 2 6 15 2 3Edible corn seeds 12 2.6 15 2.3- Field corn seeds - - 12 2.9- Total 12 2.6 27 4.2Gross marginEdibl d 40% 55%- Edible corn seeds 40% 55%- Field corn seeds - 37%- Total 40% 45%Operating costs (note 3) (7) (1.1)Operating profit 20 3.1Notes:1. Agria changed its fiscal year end in 2011 in order to align year ends with its largest subsidiary, PGG Wrightson.2. The next set of audited full year results will be for the year ended 30 June 20123. Prior to the 6 months period ended 30 June 2011, Agria did not separate operating costs between it’s China seeds division andcentral overheads
  6. 6. Agriservices – Financial OverviewYear ended 30 Jun 2010 Year ended 30 June 2011NZD million USD million NZD million USD millionRevenue- Merchandising 542 444 566 464- Livestock 87 71 140 115- Other agriservices 66 54 115 94- Total 695 570 821 673EBITDAEBITDA- Merchandising 22 18 24 20- Livestock 13 11 16 13- Other agriservices (8) (7) (10) (8)T t l 27 22 30 25- Total 27 22 30 25Operating profits 24 20 26 21Notes:1. The NZD results are extracted from PGG Wrightson’s filings.2. Agria started consolidating PGG Wrightson following completion of the partial offer in April 2011, therefore the results prior to thatdate do not appear in Agria’s results3. USD figures are provided for reference only and are translated at exchange rate of NZD 1: USD 0.824 Merchandising comprises rural supplies and fruitfed4. Merchandising comprises rural supplies and fruitfed5. Other agriservices comprises the business units detailed in this presentation and the regional overhead6. There was a reclassification of certain costs during 2011 which transferred costs from Agriservices to Central costs
  7. 7. International Seeds Division
  8. 8. International Seeds StructureCorporateNZ AustraliaSouthAmericaInternational R & D ProductionTurfContractgrowersJointventuresOur International Seeds division also comprises grain and animal nutrition businesses and is part of PGGWrightson, our New Zealand listed subsidiary
  9. 9. Market Leader in Temperate Forage SeedsMarket Leader in Temperate Forage SeedsKey features Business unit revenue (FY10)13% Leading seeds supplier in the Southern Hemisphere Clear leadership in forage seeds across current focus markets:– New Zealand c.60% market share of forage seeds– Australia c.40% market share of forage seeds– South America growing market share26%32%5%South America growing market share Unique and defendable IP tailors proprietary seed varieties tospecific temperate climatic conditions Commodity seeds also an important component, establishingcustomer relationships and preserving market positionSource: PGW24%NZ Forage AUSA TurfInternational Approximately 400 staff, including 30 focused on R&D activitiesUnit revenue split (NZ$m)Source: PGWWorld’s top 12 seed companies2502503000 51.01.52.02.53.03.54.04.55.0SalesUS$bn50100150200Revenue(NZ$m)50100150200Revenue(NZ$m)1.02.03.04.0SalesUS$bn050100150200250Source: PGWSource: ETC Group0.00.5MonsantoDupontSyngentaLimagrainLOLKWSBayerSakataDLFTakiiBarenburgPGWSSeed Pasture and turf seed2007 2008 2009NZ Forage Au ForageTurf InternationalOther2008 2009 2010NZ Forage Au ForageTurf InternationalOther0.0MonsantoDupontSyngentaLimagrainLOLKWSBayerDeltaSakataDLFBarenburgPGWPasture and turf seed Seed0FY08 FY09 FY10NZ Forage AUSA TurfInternationalpNote:1 LOL is Land O’ Lakes
  10. 10. Extensive Product Portfolio Caters to a Range ofExtensive Product Portfolio Caters to a Range ofPastoral Requirements and Climatic ConditionsB d d t tf li t i d ithi t i Volume by product (NZ) Broad product portfolio across categories and within categories Helps meet diverse customer requirements and account for specificgeographic requirements PGW Seeds strong in all forage product categories – c. 85% marketshare in NZ brassica marketVolume by product (NZ)42%14%9%6% Seed coating and branded products create opportunities foradditional margin Developing food seed proposition (pea, beans)12%15%2%9%Key seed product overview12%Perennial Ryegrass Hybrid Ryegrass Italian RyegrassOther Grasses White Clover Other legumesBrassicasCategory Product Type s DescriptionForage grasses • Perennial ryegrass • Core to pastoral farming systemForage grasses • Perennial ryegrass• Hybrid ryegrass• Italian ryegrass• Tall fescue• Core to pastoral farming system• Grasslands Innovation is core development partnerForage Legumes • Clovers• Lucerne• Assists with p asture renewal• Grasslands Innovation is core development partner• Lotus• FullaForage Brassicas • Swede• Turnip• Rape• Kale• Supplementary feed• Forage Innovation is core development partnerForage Herbs • Chicory• Plantain• Enhances forage nutritional quality• Various develop ment partners
  11. 11. Cl M k t L d i N Z l d F S dClear Market Leader in New Zealand Forage SeedKey features New Zealand processing and distribution sites c.60% market share of forage seeds 107 staff (75 operational, 7 customer service, 16 field, 2 brandedproducts, 7 management) Two brands competing in the market but focussed on differentchannels to marketHamiltonSeed coating operations1,468m2channels to market– PGG Wrightson Seeds– Agricom Two distribution centres; seven processing centresthree sites have seed cleaning operations but PGW alsoHastingsSeed processing operation1,275m2GisborneSeed processing operation– three sites have seed cleaning operations but PGW alsocontracts out seed cleaning at 50 non-PGW centresPalmerston NorthSeed distribution &processing centre3,555m2MastertonSeed processing centre1,437m2Christchurch / RollestonHead OfficeSeed distribution & processing centre5,400m2InvercargillSeed processing 2,912m2AshburtonSeed cleaning andprocessing 4,525m2
  12. 12. #1 Market Position in Australian Forage Seeds#1 Market Position in Australian Forage SeedsKey features c 40% market share of forage seedsAustralian processing and distribution sites c.40% market share of forage seeds 82 FTEs Two proprietary brands:– Wrightson Seeds Australia Keithprocessing, storage, distribution– Agricom Two seed distributors– AusWest Seeds– Stephens Pasture SeedsBrisbane-AusWestdistributionArmidale-AusWestdistribution Expanding production capability with Keith Seeds acquisitionMelbourneHead Office, coating and mixingForbes/Orange-AusWestdistribution, coating, processingdistributionMt Gambier-SPSdistributionBallarat-SPSresearch, distribution, coating
  13. 13. Leading Provider of Turf Seeds to Stadia and SportsClubsKey features Supplies turf for stadia sports clubs and golfAustralasian Turf sites Supplies turf for stadia, sports clubs and golfcourses Generally sell direct to consumer in New Zealandand through distributors in Australia Strong synergies with Production, R&D andL i ti it i b dLogistics capacity in broader company 15 staffAucklandOffice & Dispatch siteMt StewartOffice & Dispatch siteChristchurchOffice & Dispatch siteMelbourneOffice & Dispatch siteOffice & Dispatch site
  14. 14. Expanding Presence in South AmericaExpanding Presence in South AmericaKey features South American sitesMontevideoWrightson PAS HeadOfficePorto AlegreNZ Ruralco office South America’s leading supplier of proprietary and commodity forageseed products with three key brands: Alfalfares in Argentina, andWrightson PAS and Agrosan in Uruguay all three businesses distribute to rural retailers and also sell direct tofarmersMontevideoAgrosan Head OfficeOmbuesAgrosan Branch #1 market position in Uruguay through Wrightson PAS and Agrosanwith approximately 65% of the US$80m market strong market position in Argentina through 51% ownership ofAlfalfares and 50:50 ACA joint venture 67 staffMercedesAgrosan BranchBuenos AiresAlfalfares Head Office 67 staffPehuajoAlfalfares Branch
  15. 15. Leading New Zealand Grain Trader and Arable SeedS liSupplier…Key features Customers New Zealand’s largest grain brokerage and marketing serviceproviding an outlet to market for domestic grain growers Key to model is contracts with domestic grain growers andrelationships with major grain users– field representatives in New Zealand’s key cropping areashave strong relationships with growers Acts as a broker for large grain users leveraging extensivegrower relationships For smaller clients PGW trades grain by purchasing andreselling to pig, poultry, small manufacturers and farm endusers Business includes:– production in New Zealand’s key cropping areas– cereal seed marketing– wheat and barley research and new variety development– drying and storage facilities – 120kT grain drying capacityand 60kT grain storage capacity in the North IslandGeographical representation and key growing regionsand 60kT grain storage capacity in the North Island– specialist agronomic staff Employs 25 staff in New Zealand and shares network of 15Arable Representatives with the Seeds DivisionTe AwamutuSilos for grain storage WaltonPalmerston NorthGrain drying and storage x2Grain drying and storageHastingsGrain dryingand storageGrain drying and storageGrain drying and storage x2Grain growing regionsUpper North Island:Grain trading (Hamilton)L N th I l dSouth Island:Grain trading (Ashburton, Christchurch)Cereal seedA bl tSource: PGWLower North Island:Grain trading (Fielding)Arable teamAgronomy / R&D
  16. 16. China Seeds Division
  17. 17. St t i R h & D l t P t hiStrategic Research & Development Partnerships• China National Academy of Agricultural Sciences– Established in 1957 CNAAS is the largest agricultural research organization in ChinaEstablished in 1957, CNAAS is the largest agricultural research organization in China.– Comprises 39 research institutes and employs over 5,000 scientists and research engineers– Covers all major areas of the agricultural sector including advanced research in the development of both horticultureand livestock.Through its network of research institutes CNAAS controls one of the largest seed banks in the world– Through its network of research institutes, CNAAS controls one of the largest seed banks in the world.– In 2009 Agria entered into a strategic co-operation framework agreement with the China National Academy ofAgricultural Sciences (“CNAAS”) providing for future co-operation across the spectrum of agricultural research.– Agria has also entered into an investment agreement with CNAAS and its affiliates, under which Agria will investRMB35 million into Zhongnong, a company previously wholly owned by CNAAS and its affiliates with priority rights toRMB35 million into Zhongnong, a company previously wholly owned by CNAAS and its affiliates with priority rights toaccept the transfer of all existing and future cultivated seed varieties owned by CNAAS and its affiliates for thepurposes of commercialization.– Through this arrangement we have already secured the rights to Zhong Dan 909Illustrative R&D pipelineSelectionApprovalBreeding1-5 yearsCommercialisation1-3 yearsTesting2-3years
  18. 18. Attractive Commercial Product PortfolioAttractive Commercial Product Portfolio• Edible corn seeds - sticky– North China market focusNorth China market focus– Key product: JKN2000 – market leading position with 13% market share– Pipeline products: Jin Tian Nuo2000B, Jin Ke Tian183 and Jin Ke Tian158> Won three of top four positions at China’s 7th National Edible Corn Conference held in Beijing in 2011> Competition comprised 160 edible corn seed varieties - group of leading corn seed experts fromChina’s research institutes and international companies evaluated edible corn seed varieties based onfield performance and taste and awarded recommendations to the top four performing varieties entered• Edible corn seeds - sweetS th Chi k t f– South China market focus– Under development• Field corn seeds– Key product Zhong Dan 909 – advanced attributes - high yield, antiviral, anti-insect, lodging resistance– Launched in October 2011 following agreement with China National Academy of Agricultural Sciences (“CNAAS”) forthe Agria to be licensed rights to its commercialization– Zhong Dan 909 had recently been awarded nationally approved status by the Ministry of Agriculture in China. For thepast two years it has been ranked as the number one field corn variety in national certification tests hosted by Ministryof Agricultureof Agriculture– The qualities of Zhong Dan 909 make it suitable for sale in the central part of China which is one of the largest cornseed markets in China, representing approximately 40% of national yield for field corn– Previously Agria’s field corn activities were focused around our 49% owned associate Ganxin in which we invested in20102010
  19. 19. Strong Relationships with the Chinese GovernmentStrong Relationships with the Chinese Government• Government grantGovernment grant– In September 2011, we received first stage of a grant for RMB6 million– Grant made by Science and Technology division of the Beijing Government one of the most prolific research funders inChina• Use of grant• Use of grant– Funding of joint R&D into adaptation of six grass seed varieties that were originally developed in conjunction with oursubsidiary PGG Wrightson in New Zealand with a view to the seed varieties’ application in China– China has in total 390 million hectares of natural grassland (four times the area used for arable farming) but much ofthis is of very low productivity.y p y– By working jointly with our and our partners’ scientists in China, those in New Zealand and our subsidiary PGGWrightson, aim is to develop high technology content grasses to allow for the increase of productivity of this grassland.– The R&D project also intends to develop GAP (Good Agricultural Practice) in the development of grass seedtechnology by following the high standards set in New Zealand– Helps Agria to secure a pipeline of next generation seed technologies for future commercialization.– It will also serve to strengthen the PGW brand in China
  20. 20. Agriservices division
  21. 21. Compelling Portfolio of Complimentary Businesses,Primarily Serving New Zealand FarmersRural Supplies 91 rural supply stores and on-farm technical adviceFruitfed Supplies 18 retail stores and technical support for horticulture and viticultureLivestock National agent platform buying and selling livestock for clientsWool Procurement, logistics, sales and export of woolAgrReal Estate Specialty rural real estate agents in New ZealandIrrigation & Pumping Design and installation for agriculture and horticultureiserviceInsurance Marketing of insurance products brokered by AonAgriculture New Zealand Provider of agriculture trainingesSouth America Rural supplies businessOur Agriservices business is part of PGG Wrightson our New Zealand listed subsidiaryOur Agriservices business is part of PGG Wrightson, our New Zealand listed subsidiary
  22. 22. R l S liRural SuppliesKey features• Provider of goods and services to the rural sector • Approximately 40,000 customer accounts across New ZealandCustomers– key product categories include agri-chemicals, stockfeed,seed and fencing• On-farm technical sales representatives account for c.70% ofrevenue, providing advice and technical assistance togetherwith supply orders• Majority of revenue derived from sheep and beef (or mixed landuse farms) and dairy• Majority of customers are owner-operated farmers, but with shareof corporate farmers (e.g. Landcorp) increasingwith supply orders• Remaining 30% of revenue through a national network of 91retail stores• Approximately 350 employees with approximately c.70% in-store employees and the remainder technical salesrepresentatives and support staffGeographical representationUpper South Island# Stores: 6Northland# Stores: 10South Auckland/Waikato# Stores: 12Bay of Plenty / King Country# Stores: 6Canterbury# Stores: 17Otago# Stores: 12S thl dEast Coast# Stores: 5Southland# Stores: 10Taranaki/ Manawatu / Wairarapa# Stores: 13
  23. 23. F itifi d S liFruitified SuppliesKey features Customers• Leading horticulture service and supply business, providinggrower clients with agronomic advice, technical expertise andan extensive product range• Fruitified provides input materials for orchards includingchemicals, fertilisers, pollination products and frost protectionproducts• Customers are primarily in:– Viticulture– Pipfruit– Vegetables; andproducts• 18 national retail outlets supported by 60 technical field staffthat provide advice on soil, irrigation design, pest and diseaseidentification, treatment plans and monitoring systems– kiwifruitGeographical representationKerikeriMotuekaBlenheimChristchurchKatikatiKumeuMotuekaPukekoheTe PukeRichmondWhangareiAmberleyAlexandraCromwellGisborneHastingsOhakunePalmerston NorthLevin
  24. 24. LivestockLivestockKey features Customers• Sales agent for sheep, beef, dairy and deer farmers, meatprocessors and livestock importers and exporters• Major service is trading livestock through auctions, private onfarm sales, online or direct to meat processors• Strong adviser relationship with agents offering genetics,• Represent farmers trading stock to other farmers (“store”) ormatching farmers to meat processors (“prime”), such as SilverFern Farms, Alliance, Bernard Matthews, Affco, ANZO, etc• Trading occurs between farmers before slaughter based onavailable pasture i.e. dry high country farms sell lambs to thosewith available grass for fatteningstocking, animal evaluation, valuation and strategic advice tohelp facilitate a transaction through PGW• PGW has 273 agents supported by 48, owned or co-ownedsales yards and has just developed a web based platform inNew Zealandwith available grass for fattening• Sheep and beef are key markets with PGW’s market share,sold through saleyards, being 63% and 60% respectivelyGeographical representation - stock yard infrastructureKaikoheCoroglenDargivilleFranktona o eKauriMorrinsvillePaeroaRangiuruTe Awamutu TirauTuakauWellsfordBlenheimBrightwaterCanterbury ParkCheviotCulverdenHawardenSheffieldTinwaldKatikatReporoaMahoenuiTekapoRossHaastAwakinoDannevirkeFeildingFordell HuntervilleInglewoodLevinM t tMatawheroRaetihiStortford LodgeStratfordTaihapeTaumarunui TaupoTe KuitiTirauAllantonBalcluthaCharltonInvercargillMiltonOwakaPalmerstonTemukaWaiarekaWaipiataWairoaTuatapereCromwellOmaramaTekapoHakatarameaMastertonPGW 100% ownershipPGW investment (<100%) Non-PGW stock yardsWairarapa
  25. 25. Large and Growing South American Presence• PGW established a presence in the stock and station sectorthrough the acquisition of a number of small retail operators, whichfollowed the establishment of New Zealand Farming SystemUruguay (NZFSU) in 2005.Subsequent acquisitions have been successfully integrated and areIrrigationSBusiness descriptionBusiness name• Subsequent acquisitions have been successfully integrated and arewell positioned to take advantage of improving market conditions.The group represent a significant participant in Uruguay’sagriculture sector, and also form an established platform for futuregrowth into larger South American markets such as Argentina andBrazil.Vet SuppliesLivestock, Real Estate,Wool• These entities have mixed ownership structures ranging fromcomplete ownership to minority shareholdings.
  26. 26. PGW Holding Structure and Results
  27. 27. Agria Asia and PGW - StructureAgria Corporation Ngai TahuNew Hope80.81% 11.95% 7.24%Agria AsiaAgria Singapore100%NZ$34mConvertibleredeemable noteAcquisition debt (at acquisition):Bank debt NZ$53mLivestock Improvement Corporation NZ$10mAgria Singapore50.01%(at acquisition)Notes:CRN was redeemed for NZ$34m cash in December 2011PGG WrightsonAgriservicesInternational Seeds
  28. 28. Our Diverse Strategic Investment Partners Are Able toH l D i th S f PGG W i ht d E lHelp Drive the Success of PGG Wrightson and ExploreOther Opportunities.New Hope• One of China’s first private companiesestablished in 1982 and has grown tobecome one of Chinas largestNgai Tahu• Investment company representing thelargest group of indigenous iwi people inthe South Island of New ZealandLIC• Livestock Improvement Corporation isa co-operative owned by individual dairyfarmers of New Zealandbecome one of China s largestagricultural and food corporations• New Hope’s revenue for 2009 wasapproximately US$10 billion. Thecompany employs more than 60,000staff and continues to grow rapidly.the South Island of New Zealand• Founded by Government Act in 1996for protecting and advancing the NgaiTahu iwi’s collective interests andensure that the benefits of the settlementare enjoyed by Ngāi Tahu Whānui nowfarmers of New Zealand• Farm improvement company providinga diverse range of products and servicesto the dairy, beef and deer industriesboth in New Zealand and around theworld.g p y• It is involved in•agribusiness and food(accounting 85% of revenue)•chemicals and resourcesj y y gand in the future• Significant business intereststhroughout New Zealand including:• Substantial property and landinvestments• Origins, which date back to the early1900s, lie in animal performancemanagement tailored to an innovativeand wide range of products and servicesthat deliver profit to a wide range ofli k f• finance and investment• real estate and infrastructure.• The agribusiness and food sector ofNew Hope is the largest animal feedproducer and one of the largestinvestments• Seafood operations• Tourism attractionslivestock farmers• Current operations include:• Beef, deer and dairy animalrecording,• Dairy herd testing and milkproducer and one of the largestsuppliers of meat, egg and dairyproducts in China.•In addition, New Hope is the largestshareholder of MinSheng Bank (China’sseventh largest commercial bank)• Dairy herd testing and milkanalysis laboratories,• Progeny testing for the dairyand deer industries,• DNA analysis across species –b f d i t d ig )beef, dairy, goats and pigs,artificial breeding for the beef,dairy and deer industries.
  29. 29. Collaborating to Further Enhance PerformanceCollaborating to Further Enhance Performance• Representative office for PGG Wrightson– PGW is in the process of establishing a representative office in Beijingp g p j g• Live Export– Strong demand from China dairy producers for high quality milking cows– Under Chinese regulations, cows can only be imported from New Zealand, Australia or Uruguay– Agria uniquely positioned to source livestock from these markets and arrange logistics for import to China and sale to major dairy– Agria uniquely positioned to source livestock from these markets and arrange logistics for import to China and sale to major dairycompanies• Sale of grass seeds– Import of PGG Wrightson’s existing high quality grass seed for the China market– Support from Beijing government through grant for research into adapting varieties to be more suitable for range of differentpp j g g g g p g gChinese climatic conditions• China sourcing for merchandising– Facilitation of sourcing of products from China for sale through agriservices division
  30. 30. PGW Full Year ResultsYear ended 30 Jun 2010 Year ended 30 June 2011NZD million USD million NZD million USD millionRevenue- Agritech 385 316 420 344- Agriserives 695 570 821 673- Other 12 10 3 2- Total 1,091 895 1,243 1,019EBITDA N tEBITDA- Agritech 41 34 38 31- Agriservices 27 22 30 25-Other (10) (8) (19) (16)T t l 57 47 49 40Notes:1. The NZD results are extracted from PGGWrightson’s filings.2. Agria started consolidating PGGWrightson following completion of thepartial offer in April 2011, therefore the- Total 57 47 49 40Operating profits 50 41 39 32Ass., FV and non-op items 8 7 (47) (39)Interest and finance costs (36) (30) (28) (23)results prior to that date do not appear inAgria’s results3. USD figures are provided for referenceonly and are translated at exchange rateof NZD 1: USD 0.824. PGW describes the International SeedsPBT 22 18 (36) (30)Income tax (7) (6) 1 1Profit from continuingoperations15 12 (35) (29)division as Agritech5. Other predominantly relates to centraloverheads within the PGW business6. There was a reclassification of certaincosts during 2011 which transferredcosts from Agriservices to Central costscosts from Agriservices to Central costs
  31. 31. PGW Interim Results6 mths ended 31 Dec 2010 6 mths ended 31 Dec 2011 ChangeNZD million USD million NZD million USD million %Revenue- Agritech 187 153 188 154- Agriserives 426 349 503 412- Other 4 3 3 2- Total 617 506 694 569 + 12%EBITDA N tEBITDA- Agritech 13 11 12 10- Agriservices 13 11 21 17- Other (12) (10) (11) (9)T t l 14 11 22 18 + 57%Notes:1. The NZD results are extracted from PGGWrightson’s filings.2. Agria started consolidating PGGWrightson following completion of thepartial offer in April 2011, therefore the- Total 14 11 22 18 + 57%Operating profits 10 8 18 15 + 80%Ass., FV and non-op items (6) (5) (6) (5)Interest and finance costs (11) (9) (9) (7)results prior to that date do not appear inAgria’s results3. USD figures are provided for referenceonly and are translated at exchange rateof NZD 1: USD 0.824. PGW describes the International SeedsPBT (7) (6) 3 2Income tax - - - -Profit from continuingoperations(7) (6) 3 2division as Agritech5. Other predominantly relates to centraloverheads within the PGW business6. There was a reclassification of certaincosts during 2011 which transferredcosts from Agriservices to Central costscosts from Agriservices to Central costs
  32. 32. Central Overhead and Balance Sheet Overview
  33. 33. Agria’s Central Costs• Six months to 30 June 2011– As reported in the transition 20F for the 6 months period ended 30 June 2011 Agria’s central costs amounted toAs reported in the transition 20F for the 6 months period ended 30 June 2011, Agria s central costs amounted toRMB51 million (US$8 million)– These costs included a portion of the costs incurred in relation to the partial takeover of PGG Wrightson whichcompleted in April 2011– Additionally these costs include non-cash amortisation of land use rights of RMB10 million (full year charge RMB20y g ( y gmillion) in respect of leased land on which rents have already been paid in full for the life of the leases– These costs also include non-cash share amortisation expenses in the period of RMB4 million
  34. 34. Balance Sheet Overview30 June 2011RMB million USD millionCurrent assets- Cash and equivalents 94 15Cash and equivalents 94 15- Restricted cash 456 71- AR, inventories and prepayments 2,680 415- Assets held for sale 2,710 419- Other current assets 141 22Other current assets 141 22- Total 6,081 941Non-current assets- Property plant and equipment 511 79- Intangible assets and goodwill 1,237 191Intangible assets and goodwill 1,237 191- Other non-current assets 207 33- Total 1,955 303Current liabilities- Short-term bank borrowings 486 75g- Accounts payable and accrued expenses 1,259 195- Liabilities held for sale 2,233 345- Other current liabilities 28 5- Total 4,006 620,Non-current liabilities- Long-term bank borrowings 1,229 190- Other non-current liabilities 137 21- Total 1,366 211,Total Equity 2,665 412Non-controlling interest 1,216 189Total Company shareholder’s equity 1,449 224
  35. 35. Agria’s Mission Statement“T b th t l i t ti l i lt“To be the truly international agriculture companybased in China”- Ability to take advantage of the best investment opportunities,irrespective of their geography and access the best teams to realise theirirrespective of their geography and access the best teams to realise theirpotentials- Combine best international practice with local acumen to drive forwardb i i Chi i ffi i t d li tcore businesses in China in efficient and compliant manner- Be able to attract talent into senior management team with the rarecombinations of international and China leadership abilities- Exploit trade opportunities between China and investee markets (NewZealand, Australia, South America)B d d i Chi d i it l k t th t th t t t- Be regarded in China and in capital markets as the team that can extractvalue from international investments
  36. 36. Agria Corporation (NYSE:GRO)Investor presentationApril 2012

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