Murray River Organics : Managing Director AGM Presentation

only	Annual
General
use	Meeting
personal
Managing Director
and CEO presentation
31 January 2022
For	MURRAY RIVER ORGANICS	® ALL RIGHTS RESERVED. PRIVATE & CONFIDENTIAL MURRAY RIVER ORGANICS

personal use only
For	MURRAY RIVER ORGANICS

2

Agenda

1. Executive Summary
2. FY21 Financial Overview
3. FY22 Trading update
4. Strategy overview
5. Recapitalisation update

• • ALL RIGHTS RESERVED. PRIVATE & CONFIDENTIAL MURRAY RIVER ORGANICS
• ALL RIGHTS RESERVED. PRIVATE & CONFIDENTIAL MURRAY RIVER ORGANICS

Executive Summary

only	FY21 Overview
• Trading results for FY21 were disappointing.
• Sales Targets proved to be optimistic, and margins were low due to products being in
the 'launch phase' with a heavy reliance on price promotion but with significant
upside potential.
use	• Whilst good progress was made in obtaining MRG branded ranging in the major
retailers, sales momentum was not as strong as anticipated.
	• The Farming operations under performed and further SGARA accounting losses were
	incurred as a result of our yields being below budgeted levels.
	• The crop from our largest 3rd party Dried Vine Fruit farm was wiped out due to a
personal	hail-storm in January 2021. The estimated reduction in FY22 revenues was
approximately $4.5m to $6m (depending on the quality being achieved) on the hail
event alone.
	• Our largest private label contract decreased by $7.5m due to previous service level
	issues and was anticipated to decline by a similar amount into FY22.
	• With substantial inventory levels built up in early FY21, management reduced
	inventory levels and focused on exiting from underperforming parts of the business.
	In doing so, the complexity inherent in the business was also addressed via the sale
	of non-core farms and the sale of the Mourqoung facility.
	• The sale of our non-core farms saw a year-on-year reduction in 'Fresh' categories of
	$4.3m in FY21 with a further impact of $1.4m of lost revenues into FY22.
For	MURRAY RIVER ORGANICS	® ALL RIGHTS RESERVED. PRIVATE & CONFIDENTIAL MURRAY RIVER ORGANICS

Executive Summary

only	FY21 Overview continued
• With over $22m of asset sales announced during the year, we also
	announced our intention to sell the remaining dried vine fruit farms
	with the aim of creating a capital light alternative to our current
use	model. This would involve selling the farms, but keeping the 'off take',
which would see MRG continue to acquire the dried vine fruit off the
farms but rely on the new owners to manage and grow the agricultural
	footprint.
	• During FY21 and into FY22, we have been reviewing and assessing
personal	several M&A opportunities that would be expected to accelerate the
group to positive EBIT. Our aim is to improve the utilization of our
	Dandenong facility and grow our existing FMCG assets as we complete
	the divestment of our farm portfolio with off-take agreements.
For	MURRAY RIVER ORGANICS	® ALL RIGHTS RESERVED. PRIVATE & CONFIDENTIAL MURRAY RIVER ORGANICS

For personal use only

FY21 Financial Overview

MURRAY RIVER ORGANICS

® ALL RIGHTS RESERVED. PRIVATE & CONFIDENTIAL MURRAY RIVER ORGANICS