2. 1. Excellent high-quality business with strong
financial position and growth
2. Asset Undervaluation of 31% with large upside
3. Good dividend yield of 2.04%
4. Small-cap potential
5. Growth through land acquisitions and
operational improvements

3. Well-diversified water, cropping and pastoral operations
and agribusiness services
1. Farming: 56% of revenues
 8800 hectares of cotton area, 5000 hectares cereal planting
area in Australian Murray Darling Basin
 Future cotton prices favorable
 average yield increased to 10.2 bales/hectares: +14%
 6% EBIT increase due to record harvest
2. Water: 44% of revenues
› One of the largest water portfolios (55 ML) in Murray Darling
Basin
› No new licenses to be issued  30% of entitlements by 2019
› 14% EBIT increase

4.  $2 billion market in Australia,
 Worldwide: -3.5% decrease in production, +7% in crease
in demand positions Tandou to benefit
 US cotton acreage declined due to lower prices and
focus on corn/soybean production
 Drought in US decreased harvest yields
 Cotton price offers upside

5.  $27 billion market with the only large-scale trading
system of limited number of water entitlements
 10-year drought caused government to start
buyback program
 Supply constant and demand growing
 Water entitlements will continue to increase in
value

6.  TAN outperformed ASX 200 index and
competitors

7. Revenues increase of 34%
EBIT increase of 12%
NOPAT increase of16% increase
EBIT margin increase of 12%

8. Little debt: D/EV 0.13
High liquidity: current ratio 2.8
EBIT/Interest Expense 10.2

11.  Fair Value of $1.27 min. 40% return
 80% return over 2 years

12.  Commodity price risk negligible due to
strong demand and decreased supply
 Currency risk low due to Tandou’s
hedges
 Little market risk with a beta of 0.49

13.  Dividend yield of at least 2/3 of dividend
yield of AAA bond: 2.04%>1.92%
 Share price of no more than 2/3 of
tangible book value: P/B 86%
 Total debt below book value : D/E of
0.13
 Current ratio of two or more: 2.8
 Earnings have more than doubled in the
past 10 years: $1.4 million in 2009 to $6
million in 2013

14. Total Enterprise Value
Total Equity
Value
Terminal Perpetuity Growth
Rate
Terminal Perpetuity
Growth Rate
2.5% 3.0% 3.5% 2.5% 3.0% 3.5%
Discount 6.0% $107.6 $123.6 $146.2 Discount 6.0% $71.7 $87.8 $110.3
Rate 7.0% 83.5 92.6 104.2 Rate 7.0% 47.7 56.7 68.3
(WACC) 8.0% 68.4 74.1 81.0 (WACC) 8.0% 32.5 38.2 45.2
Implied Terminal
EBITDA Multiple
Total Price
Per Share
Terminal Perpetuity Growth
Rate
Terminal Perpetuity
Growth Rate
2.5% 3.0% 3.5% 2.5% 3.0% 3.5%
Discount 6.0% 10.9x 12.8x 15.4x Discount 6.0% $0.91 $1.11 $1.40
Rate 7.0% 8.5x 9.6x 11.0x Rate 7.0% 0.61 0.72 0.87
(WACC) 8.0% 6.9x 7.7x 8.5x (WACC) 8.0% 0.41 0.49 0.57

15.  Acquisitions of water and land assets worth more
than $32 million and $25.2 million equity raising
demonstrates TAN’s confidence
 Projected upside of cotton price enhances return
prospects
 Reduction in water entitlements and dryness
increases value of water entitlements
 Fortune 500 experienced management team and
new Board member contributes expertise creating
value growth from agricultural assets & operations
 18% stake purchase by investor with expertise in
agricultural assets

16. 1. High-quality business with strong growth,
improvements and outperformance of
peers
2. Excellent track record of management
and recent addition of expertise
3. Good dividend yield of 2.04% and
diversification
4. Small-cap lack of coverage positions SCM
to benefit from mispricing
5. Asset Undervaluation of 31% with large
upside