Full Year Results Investor Presentation 2023
SYNLAIT'S FY 23 RESULT
Decreased Advanced Nutrition margin, significant ERP implementation costs, high inflationary
pressures, and increased interest costs significantly impacted financial performance in FY 23.
Ingredients
Overall margin ($2.9m) unfavourable to FY 22.
Volume impact: ($10.3m) adverse. Sales volumes
23,625 MT (18%) lower due to FY 22 benefiting from
high carry over of ingredients from FY 21 and 38%
higher Advanced Nutrition base powder production
displacing ingredient production and sales.
Margin impact: $7.4m favourable driven by SMP/AMF
lead bucket performance, offset by a more normal
level of FX performance and higher manufacturing
overheads.
Advanced Nutrition
Overall margin ($16.8m) adverse to FY 22.
Volume impact: ($3.4m) adverse. Volumes 1,535 MT
(5%) lower than FY 22 because of reductions and
deferrals in demand and SAMR re-registration delays.
Margin impact: ($13.4m) adverse. Driven by timing
impact of lag pricing mechanisms, a more normal
level of FX performance compared to FY 22, and
significantly higher overhead costs. Impact was offset
by higher base powder manufacture and continued
strong lactoferrin pricing.
1 These items have been excluded as they do not reflect future operating
expenses or revenue and will be inconsistent in amounts and frequency
making it difficult to contribute to a meaningful evaluation of our
operating performance.
2 FY 22 adjusted NPAT has been restated to include ERP implementation
costs for consistency with FY 23 adjustments This has resulted in FY 22
adjusted NPAT increasing to $36.3m from $34.0m.
PAGE 5
Consumer (Beverages & Cream and Dairyworks)
Overall margin $7.6m favourable to FY 22, of which
$4.3m related to Beverages & Cream and $3.3m
related to Dairyworks.
Volume impact: ($1.0m) adverse as Dairyworks sold
less butter.
Margin impact: $8.6m favourable as beverages
benefited from pricing lag and lower overhead costs.
Dairyworks benefited from the closure of the Temuka
plant and first full year of new cool store operations.
Milk trading and other
$11.1m favourable to FY 22 due to raw milk and cream
sales to enable alignment of product mix to SMP/AMF
lead bucket, impact of Synlait Farms, Foodservice
and other eliminations.
SG&A expenses
$21.0m increase in adjusted SG&A costs with drivers
being employee costs, consultancy & legal, travel,
and general inflation.
Recurring ERP costs
•
•
Annual recurring ERP costs (including depreciation)
were $10.6m.
Financing costs
$12.8m increase in adjusted financing costs due
primarily to rising interest rates.
36.3
(2.9)
FY 22
NPAT
adjusted
Adjusted NPAT bridge ($ millions)
11.1
(16.8)
Ingredients
margin
Advanced
Nutrition
margin
7.6
Consumer
margin
Milk trading &
other
(21.0)
(10.6)
(12.8)
Adjusted
SG&A costs
Recurring
ERP costs
Adjusted
11.6
2.5
costs
financing
Adjusted
income taxes
FY 23
NPAT
adjusted
Reconciliation of reported to adjusted
NPAT and EBITDA ($ millions)
FY 23
(4.3)
FY 222
38.5
Reported NPAT
Items affecting comparability':
ERP implementation costs
Contract dispute and transaction costs
Gain on sale of New Zealand Units (NZUS)
Gain on sale and lease back
Interest costs attributable to ERP implementation
6.8
3.3
1.9
(1.8)
-
(11.9)
4.5
Impairment of Temuka cheese plant (Dairyworks)
12.2
Legal settlement (Dairyworks)
(2.0)
Tax impact of above items
(2.6)
(5.8)
Total NPAT adjustment
Adjusted NPAT
6.8
(2.2)
2.5
36.3
4.9
(8.6)
Reported EBITDA
90.7
131.6
Adjusted EBITDA
95.6
123.0
Total EBITDA adjustment
FULL YEAR RESULTS INVESTOR PRESENTATION 2023View entire presentation