Olam Group Limited Transforming to serve a changing world Re-imagining Olam: Investor Presentation | May 2022
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Olam Group Limited Re-imagining Olam: Transforming to serve a changing world Investor Presentation | May 2022
Cautionary note on forward-looking statements This presentation may contain statements regarding the business of Olam Group Limited and its subsidiaries (the ‘Group’) that are of a forward-looking nature and are therefore based on management’s assumptions about future developments. Such forward looking statements are intended to be identified by words such as ‘believe’, ‘estimate’, ‘intend’, ‘may’, ‘will’, ‘expect’, and ‘project’ and similar expressions as they relate to the Group. Forward-looking statements involve certain risks and uncertainties because they relate to future events. Actual results may vary materially from those targeted, expected or projected due to several factors. Potential risks and uncertainties includes such factors as general economic conditions, foreign exchange fluctuations, interest rate changes, commodity price fluctuations and regulatory developments. The reader and/or listener is cautioned to not unduly rely on these forward-looking statements. We do not undertake any duty to publish any update or revision of any forward-looking statements. Olam Group Limited Investor Presentation | May 2022 2
Group overview
We are a leading food and agri-business supplying food, ingredients, feed and
fibre to over 20,900 customers worldwide.
We are We are We are We are
farmers suppliers processors innovators
Field and farming experts Connecting customers to Transforming raw Offering added value
growing crops, such as their source of supply via materials into bespoke solutions through our
almonds in Australia and our direct and indirect ingredients across our innovation centres and
USA, and coffee global network of farmers. 75+ Tier 1 facilities. supply chain.
plantations in Laos and
Zambia. On the ground presence all
year round executing Focused on safety, Experts in product
procurement, traceability, fairness, quality, efficiency innovation, customisation,
Our scale gives us global
warehousing, logistics and and the environment. digital apps and
market insights, shared
paperless trading. co-manufacturing.
learnings and efficiencies.
Olam Group Limited Investor Presentation | May 2022 3
Over 30 years of growth
Year: 1989 Year: 2021
Our
products 1 47
Our
countries Nigeria 60+
Our
revenue
S$2 million S$47.0 billion
Our
employees 43,100
* Employees refer to full-time employees. Including seasonal and temporary workers, employees at 82,300 in 2021.
* Employee figure includes full time, seasonal and contract workers.
Olam Group Limited Investor Presentation | May 2022 4
Our aspiration
Our
Purpose
Our
To re-imagine global vision
agriculture and food systems.
Our
To be the most differentiated governing objective
and valuable global food
and agri-business by 2040.
To maximise long-term
intrinsic value for our
continuing shareholders.
Olam Group Limited Investor Presentation | May 2022 5
Our shareholders
First listed on the Singapore Exchange in 2005, we are now listed as Olam Group Limited since
March 16, 2022, supported by a diversified shareholder group with long-term investment horizon.
Temasek Mitsubishi Kewalram Directors Other
Holdings Corporation Chanrai Institutional
Group and Public
Investors
51.1% 14.4% 6.8% 4.3% 23.4%
Note: Shareholdings are based on 3,842,625,185 issued shares as of May 27, 2022.
Olam Group Limited Investor Presentation | May 2022 6
Our customers
Diversified base with long-term relationships
Number of customers Strong and reputable customer base
More than 20,900 customers worldwide, including several leading global brands
Olam Group Limited Investor Presentation | May 2022 7
Re-organisation of Olam
In January 2020, Olam announced a transformational Re-organisation Plan to re-organise its diverse
business portfolio into three distinct operating groups that are Purpose-led and future-ready in order to
maximise Olam’s long-term value on a sustained basis.
Objective
To explore strategic options that would illuminate
the current value in
the business and develop new pathways to create further long-term
value on a sustained basis
Plan
Simplify and focus our current diverse portfolio of businesses into three
coherent operating groups that are more similar in nature, linked by an
underlying logic and aligned to key consumer food and agri business trends respectively.
Each entity has developed a compelling
vision, a distinct equity story and reliable
game plan for profitable growth and value creation on a
sustained basis
8
Olam Group Limited Investor Presentation | May 2022 88
Re-organisation: Progress update
Creation of three distinct operating groups
ofi: An attractive play for the growing Olam Agri: A market leading & Remaining Olam Group:
demand for natural, plant based, on trend, differentiated global food, feed & fibre agri- Responsibly divests non-core businesses &
sustainably sourced & fully traceable food business focused on high growth emerging assets earmarked for exit, nurture &
ingredients and solutions so consumers can markets delivering superior returns. It is partially/fully monetise gestating businesses
enjoy the healthy & indulgent products they aligned to the key trends of meeting the rising & incubate new platforms of growth & build
love. demand for food staples & fibre in high technology and shared services business
growth markets as well as the shift to protein
based diets in these regions.
Olam Ventures – an independent
Cocoa Grains Cotton incubator for digital & sustainability
& Oilseeds start-up growth businesses in the Food
Coffee Specialty Grains & Ag sector
Wood
& Seeds
Dairy Olam Technology and Business
Services (OTBS) – delivering digital
Edible Oils Natural Rubber
Nuts and technology services for the new
operating groups as well as to third
Commodity parties
Spices Rice
Financial
Services
Olam Global Holdco (OGH) –
Animal Feed nurturing our gestating assets &
& Protein responsibly divesting our de-prioritised
businesses & related assets
Olam Group Limited Investor Presentation | May 2022
Re-organisation: Progress update New structure for Olam Group Olam Group Limited Investor Presentation | May 2022 10
Re-organisation:
Progress update
Step 4 being executed STEP 4
ofi IPO and demerger, Olam
Agri strategic partnership,
strategic options for
STEP 3 Remaining Olam Group
Carve-out & • Proposed ofi listing: ofi would be
demerged from Olam Group by way of a
separation distribution in specie of shares in OFIGL*
STEP 2 • Dedicated implementation teams to Olam Group shareholders at the point
of demerger in conjunction with the IPO
STEP 1 Re-organisation for Separation, IPO and
Demerger set up. • LTSA & Demerger Agreement targeted
• Developed Targeted
Re-segmentation Operating Model (TOM) for the • Programme Office, independent
to be signed prior to ofi IPO & closing of
financial advisors, legal and tax SALIC transaction
• Re-segmented the current new operating groups,
business into three new operating advisers, PR and IR advisers • Olam Agri: Announced a strategic
including embedded business, appointed partnership with SALIC through the sale
groups, ofi, Olam Agri and country/regional structures
• Carve-out & Separation of a substantial minority stake (35.4%) in
Remaining Olam Group. and central functions Olam Agri for US$1.24 billion
substantially completed for ofi,
• Developed new reporting • Dedicated leadership & Olam Agri and Remaining Olam • In parallel, exploring strategic options for
segments, key financial metrics for management teams for each Group by end-2021 maximising the value of the Remaining
each operating group operating group in place Businesses of Olam Group comprising
• Scheme of arrangement
Olam Ventures, Olam Technology and
• Reported 2020 and 2021 results • Hiring of new talent for the key effected; Olam Group Limited
listed on SGX Mainboard and Business Services (OTBS) and Olam
on basis on new operating groups capabilities required to pivot Global Holdco (OGH)
and segments with historical OIL delisted
both the ofi and Olam Agri
comparative financials businesses Underway
Completed
Completed Completed Shareholders should note that there is no certainty or
* OFIGL: OFI Group Limited. Prior to IPO, assurance that the listing and demerger of ofi or the
OFIGL will re-register to be ofi group PLC. strategic options being explored will take place. 11
Olam Group Limited Investor Presentation | May 2022ofi in numbers
Cocoa Coffee Nuts Spices Dairy
14.6
Billion revenue (S$)
1,2 1
Million
7
EBITDA (S$)
875
Million EBIT (S$)
110+
Manufacturing
50
Countries
24,500+
employees
11,000+
customers
facilities
12ofi – attractive portfolio with strong growth prospects
1
Value-added ingredients & solutions,
Leading on-trend portfolio, serving large, attractive
serving ~US$743bn1 key end-use categories,
and growing end-use categories which are growing at ~5% CAGR1,2
2
Integrated with Access to
presence 2.6 million3 110+
Delivering global, innovative and integrated solutions across the farmer network Manufacturing
value chain globally plants
3 Differentiated customer proposition, offering end-to-end
traceability and sustainability impact
>350 sustainability impact metrics4 across
11 key areas and 12 UN SDGs4,5
4 Trusted partner to a global and diversified customer base 11,000+
Customers
5 Experienced, global, and inspired talent pool 24,500+
Employees
54
Nationalities
6
+8.1% 90-100bps
Proven and repeatable growth model EBIT CAGR6 EBIT Margin and RoIC7
(’17A-’21A) expansion (’17A-’21A)
(1) Source: Euromonitor International Limited, Retail Value RSP, US$ million, fixed 2021 exchange rates, current prices. US$743bn refers to the size of ofi’s key end-use categories (in 2021, globally) including beverages, bakery, confectionery, snacking and
culinary which are defined as outlined on page 177, “Euromonitor Sources”;(2) '21-26E on value basis; (3) direct & indirect network, based on FY20 data; (4) Olam overall; (5) SDG = Sustainable Development Goals; (6) on a US$ basis; Operational EBIT Excluding 24
discontinued and exiting businesses; (7) On a US$ basis; Operational EBIT / Average Invested Capitalofi: Growth framework
Organic Growth – Growing & extending the core
Extract full value from current investments
Increase share of value with targeted strategic customers Contribution to medium-term
Volume growth:
Focus on cost competitiveness Low to Mid-single digit %
Expand innovation & sustainability solutions
Contribution to medium-term
Adjusted EBIT1 growth:
Accelerated M&A opportunities in higher value products, categories, and
channels…
High-single digit %
• Channel expansion: private label, foodservice, e-commerce
• Product extensions: Eg: nut ingredients, spice blends, etc
• Category solutions: beverages, bakery & confectionery, snacks, culinary
Inorganic Growth – Disciplined Buying
1:
14
adjusted for one-off non-recurring items3 Segments
30 9,100+ S$31.3b
1 countries Employees revenue
Food & Feed - Origination & Merchandising
41m 50+
2 tonnes in volume handled Manufacturing &
processing facilities
Food & Feed - Processing & Value added
3 S$930m S$753m
EBITDA 2018-2021 CAGR: 42.5% EBIT 2018-2021 CAGR: 46.7%
Fibre, Agri-Industrials & Ag Services 15Olam Agri: Key highlights
1 Strategically positioned in the attractive food & agri sector supported by strong secular fundamentals, with a
clear focus on high-growth emerging consumption markets
2 Participation in key parts of the global agri market and targeted sub-markets through a differentiated model
including selective integration across the value chain with strong operating capabilities
3 Clear growth pathways to significantly grow earnings on a sustainable basis over the medium/long-term by
increasing share of value-added products and expanding geographic footprint
4 Helmed by a highly experienced, capable and engaged management team
5
Market leading sustainability track record putting Olam Agri at the forefront of meeting the
key sustainability objectives of being livelihood positive, nature positive and climate positive across our
businesses
Olam Agri’s differentiated asset-light model and focus on high-growth emerging markets
has led to an industry leading growth and return profile. 16
16Olam Agri: Positioning for future growth
The Saudi Agricultural and Livestock Investment Company (“SALIC”), a wholly owned
subsidiary of Public Investment Fund (PIF) of the Kingdom of Saudi Arabia (KSA), to invest
US$1.24 billion for an estimated 35.4% stake in Olam Agri
1. Illuminates and unlocks value for our shareholders, thereby completing one of the key milestones
of the Re-organisation Plan
2. Crystallises a benchmark valuation for Olam Agri today, and creates a strong shareholder base
for a potential future listing and demerger of Olam Agri – Investment implies 100% equity
valuation of US$3.5 billion for Olam Agri subject to closing balance sheet adjustments.
3. Raises significant net cash proceeds to repay debt at the OG Group level and right-sizes the
capital structure of OG Group, thereby strengthening its balance sheet, improving credit profile
and enhancing financial flexibility to capture future growth
4. Generates synergies and catalyses access for Olam Agri to new markets through a long-term
Strategic Supply and Cooperation Agreement (SSCA) with SALIC 17Remaining Olam Group
Exploring strategic options to unlock further value
Olam Technology and
Olam Ventures Business Services (OTBS) Olam Global Holdco
An independent incubator for our Delivers digital and technology services to Holds and develops our gestating assets
Engine 2 businesses & start-up initiatives each Operating Group to monetise partially or fully these assets
focusing on our digital and sustainability over time
capabilities Will utilise its capabilities to offer services • Olam Palm Gabon
to third-parties in the future • Caraway (Packaged Foods Business)
• Jiva – Farmer services platform
• Adva – Sustainable lifestyle platform • ARISE
• Terrascope – Smart carbon Oversees the responsible divestment of
management platform our de-prioritised businesses & assets
• Re-Foods – Purpose brand business • By end-2021, we have fully exited
in food most of the de-prioritised assets ear-
• A co-created food and agri-industry marked for divestments in the Strategic
digital sustainability platform built on Plan
our proprietary AtSource solution • Post 2021, we divested our entire
stakes in ARISE IIP and ARISE IS
• To divest remaining 7 assets by end
2024
Olam Group Limited Investor Presentation | May 2022 18Olam Ventures
Criteria for selecting Engine 2 ventures
1• Built on the twin engines of Digitalisation and Sustainability
2• Leveraging Olam’s core strengths & unique assets
3• Strategic & Financial value to Olam
4• Disruptive idea
5• Material & Scalable opportunity – large enough opportunities that can become new engines of growth for
Olam in 6 years (two 3-year planning cycles).
6• Smart investing (digital & sustainability) rather than asset-heavy capital led models
Six Engine 2 initiatives being studied/explored
1 2 & 3 4 5 6
Sustainability Lifestyles
Farmer Services platform (Adva (B2C)) Carbon Trading & Food & Agri
Sustainable Purpose Brands
Platform: Sector Digital
Smart carbon management Landscapes Re~ (B2C)
Jiva Sustainability
Investment Platform
platform Terrascope (B2B, platform
formerly “GreenPass”)
Olam Group Limited Investor Presentation | May 2022 19Reporting segments and key performance metrics
Operating group Businesses Reporting segments Key performance metrics
Cocoa, Coffee, Dairy, Nuts, 1) Global Sourcing Segment-level
Spices 2) Ingredients & Solutions Volume, Revenue, EBIT, EBIT
ofi Margin, Invested Capital (IC),
EBIT/IC
Grains, Integrated Feed & 1) Food & Feed - Segment-level
Proteins, Edible Oils, Rice, Origination & Merchandising Volume, EBIT, EBIT per MT,
Specialty Grains & Seeds, 2) Food & Feed - Invested Capital (IC), EBIT/IC
Olam Agri
Cotton, Wood Products, Rubber, Processing & Value-added
Commodity Financial Services 3) Fibre, Agri-industrials & Ag Services
Olam Ventures (Engine 2 growth 1) De-prioritised/Exiting Assets Segment-level
platforms), OTBS and OGH (De- 2) Gestating Businesses Revenue, EBIT, Invested
prioritised assets and gestating Capital (IC), EBIT/IC
Remaining Olam 3) Incubating Businesses
assets, including Olam Palm
Group
Gabon, Packaged Foods,
Infrastructure and Logistics
(ARISE))
Consolidated Volume, Revenue, EBITDA, EBIT,
Invested Capital (IC), EBIT/IC,
Olam Group
ROIC, ROE, FCF from Operations
Olam Group Limited Investor Presentation | May 2022 20Group 2021 results
Consolidated results by operating group
Volume ('000 MT) 1.5% Revenue (S$ m) 2.4%
9.1%
Volume 31.1%
ofi ('000 MT) ofi
45,425.3 Olam Agri
47,002.0
20,058.4 Olam Agri
+2.3% OIL
+31.2%
+5.0% OIL
89.4% 66.5%
EBIT (S$ m) IC (S$ m)
(14.4%)
27.6%
13.5%
ofi ofi
1,422.6 Olam Agri
19,012.1 Olam Agri
+33.0% OIL
+14.1% OIL
52.9%
61.5% 58.9%
Olam Group Limited Investor Presentation | May 2022 21Group 2021 results
At a glance
Volume & Revenue EBIT PATMI
45.4 M MT S$47.0 B S$1,423 M S$686 M
+2.3% +31.2% +33.0% +179.4%
Operational Free Gearing
PATMI Cash Flow
S$961 M FCFE Unchanged at
+41.8% -S$1.0 B 1.72x
Olam Group Limited Investor Presentation | May 2022 22Group 2021 financial
highlights
Record Reported & Resilient balance sheet
Operational PATMI Second interim dividend
despite rising prices
179.4% growth in PATMI in 2021 to Strong cash position of S$4.3 billion, Board of Directors declares
S$686.4 million with available liquidity of S$22.5 billion second interim dividend of 4.5
as at end-2021 cents per share or total dividend
Operational PATMI in 2021 at S$961.1 of 8.5 cents per share (2020: 7.5
million, a 41.8% growth over 2020 Continued to access diversified pools
of capital for refinancing during the cents per share)
ofi and Olam Agri reported EBIT year
growth of 16.8% and 51.5% Equity position strengthened by higher
respectively, riding on structural retained earnings and the 2021 Rights
demand growth and recovery from Issue
Covid-19
Gearing maintained at 1.72x; adjusted
Operational ROE up 560 basis points gearing net of RMI and secured
to 16.8% in 2021 (2020: 11.2%) receivables at 0.75x
Olam Group Limited Investor Presentation | May 2022 23Group 2021 results: P&L statement
S$ million 2021 2020 % Change
Volume ('000 MT) 45,425.3 44,409.7 2.3
Revenue 47,002.0 35,820.0 31.2
Net gain/(loss) in fair value of biological assets^ 97.7 (60.3) n.m.
Depreciation & Amortisation (627.2) (561.3) 11.7
EBIT^ 1,422.6 1,069.5 33.0
Net Finance costs^ (411.2) (415.7) (1.1)
Taxation^ (133.9) (43.5) 207.8
Exceptional items (274.7) (432.1) (36.4)
PAT 602.8 178.2 238.3
PATMI 686.4 245.7 179.4
Operational PATMI^ 961.1 677.8 41.8
^ Excluding exceptional items
Olam Group Limited Investor Presentation | May 2022 24Group 2021 results: Volume grew 2.3%
Contributed by both ofi and Olam Agri
Volume by operating group, '000 MT
+2.3%
44,410 486 682 45,425
-151
2020 ofi Olam Agri OIL 2021
Note: 2020 financial results for the operating groups have been re-stated to reflect intra-group adjustments.
Olam Group Limited Investor Presentation | May 2022 25Group 2021 results: EBIT increased by 33.0% to
S$1.4 billion
Strong contribution from ofi and Olam Agri
EBIT by operating group, S$ million
+33.0%
256
1,423
-29
126
1,070
2020 ofi Olam Agri OIL 2021
Note: 2019 and 2020 financial results for the operating groups have been re-stated to reflect intra-group adjustments.
Olam Group Limited Investor Presentation | May 2022 26Group 2021 results: Record PATMI & Operational
PATMI
PATMI up 179.4%, Operational PATMI up 41.8% on strong EBIT growth
PATMI and Operational PATMI, S$ million
+179.4%
157 16 686
353 4
-90
246
2020 EBIT^ Net Finance Taxation Exceptional Non-controlling 2021
Costs Items Interests
Operational
678 +41.8% 961
PATMI (S$ M)
^ Excludes exceptional items
Olam Group Limited Investor Presentation | May 2022 27Group 2021 results: Balance sheet
S$ million 2021 2020 Change
Fixed Capital 9,532.9 8,309.9 1,223.0
Right-of-use assets 782.7 712.2 70.5
Uses of Working Capital 8,120.6 7,455.7 664.9
Capital Cash 4,317.5 3,115.9 1,201.6
Others 735.1 601.7 133.4
Total 23,488.8 20,195.4 3,293.4
Equity & Reserves 7,210.5 6,425.4 785.1
Non-controlling interests 7.4 73.5 (66.1)
Short-term debt 6,937.6 6,466.5 471.1
Sources of Long-term debt 8,794.8 6,780.9 2,013.9
Capital Short-term lease liabilities 138.0 96.5 41.5
Long-term lease liabilities 839.8 815.5 24.3
Fair value reserve (439.3) (462.9) 23.6
Total 23,488.8 20,195.4 3,293.4
Olam Group Limited Investor Presentation | May 2022 28Strong liquidity position
Total borrowings and available liquidity, S$ Million as at December 31, 2021
Short-Term Long-Term 11,191 22,512
+5,802
16,710
7,075
1,065
5,938
4,318 9,635
Cash and Short- RMI* Secured Unutilised Available Total
term Fixed Deposits Receivables Bank Lines Liquidity Borrowings
* RMI: Readily marketable inventories that are liquid, hedged and/or sold forward
Olam Group Limited Investor Presentation | May 2022 29ofi 2021 results
S$ Million Invested Capital
EBIT +7.0% Global Sourcing
Ingredients & Solutions +12.1%
+16.8%
875 +20.2%
765 750 11,192
52% 8,901 9,312
50% 49% 46%
62% 59%
50% 51% 48% 54%
38% 41%
Restated 2019 Restated 2020 2021 Restated Restated Dec-21
Dec-19 Dec-20
EBIT Margin 6.5% 6.1% 6.0% EBIT/IC 8.8% 8.2% 8.5%
• ofi posted strong EBIT growth of 16.8% in 2021, • IC increased by 20.2%, reflecting investments in
demonstrating a strong recovery from the impact that Ingredients & Solutions, particularly the
Covid-19 had on some of its businesses in 2020. acquisition of Olde Thompson.
• Both the Global Sourcing and the Ingredients & Solutions • Higher input prices also led to increased working
segments performed well in 2021. capital requirements.
30
Note: 2020 financial results for the operating groups have been re-stated to reflect intra-group adjustments.ofi: Global Sourcing
S$ Million
EBIT Invested Capital
+9.1% -3.7%
Working Capital
+23.7% Fixed Capital -7.2%
455 5,496 5,491
5,095
382 368
3,278 3,279 2,907
2,218 2,212 2,188
Restated Restated 2021 Restated Restated Dec-21
2019 2020 Dec-19 Dec-20
EBIT Margin 4.1% 3.7% 4.5% EBIT/IC 7.3% 6.7% 8.6%
• Strong EBIT growth of 23.7%, reflecting a strong bounce- • IC decreased by 7.2% during 2021 driven principally by
back from the impact of Covid-19 in the prior year improvements in operational cycle times which were partly
• Strong performance from the Coffee, Cocoa, Dairy and offset by increased input prices for some products.
Nuts platforms
• The Nuts upstream (almonds) business on the other hand
Note: The segment now includes coffee plantations, which were previously
performed below plan due to lower selling prices. classified under Remaining Olam Group’s De-prioritised/Exiting Assets. 26ofi: Ingredients & solutions
S$ Million
EBIT Invested Capital
+4.9% +33.8%
Working Capital
+10.1% Fixed Capital +59.5%
421 6,097
383 382
2,633
3,822
3,405
1,662 1,967
3,464
1,743 1,855
Restated Restated 2021 Restated Restated Dec-21
2019 2020 Dec-19 Dec-20
EBIT Margin 7.9% 7.3% 6.3% EBIT/IC 11.2% 10.6% 8.5%
• EBIT increased by 10.1% in 2021: The segment saw improved performances • IC increased significantly by 59.5%.
across our Cocoa , Coffee, Dairy and Nuts ingredients & solutions platforms • Fixed capital grew with acquisitions in the US, organic growth
• The Spices platform, especially in the US was hurt by lower farming and initiatives in Soluble Coffee and Dairy processing, and capacity
manufacturing yields as well as higher costs and supply chain disruptions. expansion in Cocoa processing and co-manufacturing facilities.
• Integration of OT continues to proceed well, and additional synergies have • Working capital also grew on acquisitions as well as an increase in
been identified for 2022 & beyond. However, labor cost inflation and the carrying value of inventory due to higher input prices.
supply chain disruptions had an adverse impact on expected, which are • EBIT/IC for the year reduced to 8.5% in 2021 due to the organic
expected to normalize in 2022. and inorganic growth investments made, the annualized
earnings from which are yet to come in. 27Olam Agri 2021 results Food & Feed - Origination & Merchandising Fibre, Agri-industrials & Ag Services
S$ Million Food & Feed - Processing & Value-added
EBIT Invested Capital
+40.1% +27.7%
+51.5% +24.5%
753 5,242
4,211 16%
35%
497 3,214 19%
384 8% 40%
38%
37% 44%
39% 60%
36% 50% 44%
28% 32% 37%
25% 12%
Restated 2019 Restated 2020 2021 Restated Restated Dec-21
Dec-19 Dec-20
EBIT/MT (S$) 11 12 19 EBIT/IC 13.2% 13.4% 15.9%
• Strong EBIT growth of 51.5%; In Food & Feed segments, Grains, Integrated Feed &
• IC increased by 24.5% in 2021 primarily due to the significant rise in Fibre,
Proteins had an exceptional year in 2021 and continues to be a consistent
Industrial & Ag Services, which was largely caused by the decade-high
performer
cotton prices.
• Rice business reported an all-round, strong performance across farming, milling,
origination and merchandising, distribution; Edible Oils experienced a recovery
amid strong demand growth in key markets.
• Fibre, Agri-industrials & Ag Services segment showed a sharp turnaround from the Note: 2020 financial results for the operating groups have been re-stated to reflect intra-group
prior year with strong growth in Cotton, Rubber and Wood Products. adjustments. The Fibre & Ag Services segment has been renamed as Fibre, Agri-industrials & Ag
Services to include Rubber processing and supply chain, and Wood Products forestry concessions,
which were previously classified under Remaining Olam Group’s De-prioritised/Exiting Assets 33
segment.Olam Agri: Food & Feed - Origination & Merchandising
S$ Million
EBIT Invested Capital
+33.2%
+79.3%
+42.7% Working Capital
+4.7%
267 Fixed Capital
813 851
187
150 657
677
265
131
134 136 194
Restated Restated Dec-21
Restated 2019 Restated 2020 2021 Dec-19 Dec-20
EBIT/MT (S$) 5 6 8 EBIT/IC 42.1% 34.7% 32.1%
• EBIT up 42.7%: Strong Grains origination & merchandising volumes in corn and wheat • IC increased by 4.7% in 2021 as fixed capital increased with the
between Brazil and the Black Sea into Asia and Middle-East, combined with a strong recognition of right-of-use assets on freight vessels.
customer relationships, disciplined risk management and good freight management led
to improved performance in both top line and EBIT
• Surge in rice exports from India amid the supply squeeze in the key producing countries
in Asia positioned us well for entering new markets in 2021
• Edible Oils trading also contributed to the growth in EBIT as out-of-home consumption
of edible oils largely resumed in Asia and Africa to pre-Covid-19 levels.
34Olam Agri: Food & Feed - Processing & Value-added
S$ Million
EBIT Invested Capital
+40.6%
+4.2%
Working Capital
+9.6%
Fixed Capital +11.6%
275
251 2,074
1,912 1,859
514 591 816
139
1,398 1,268 1,258
Restated 2019 Restated 2020 2021 Restated Restated Dec-21
Dec-19 Dec-20
EBIT/MT (S$) 42 58 61 EBIT/IC 8.6% 13.3% 14.0%
• EBIT rose by 9.6% in 2021: Grains’ Wheat Milling & Pasta manufacturing and the • IC increased by 11.6% in 2021 as OGA expanded its Rice inventory in
Animal Feed business performed well as capacity utilisation across these operations Africa to ensure it could meet anticipated demand in the face of Covid-
and margins for poultry and fish feed manufacturing improved.
19 and supply chain disruptions. OGA also procured additional paddy
• Branded and premium Rice distribution business continued to enjoy all-round at competitive prices to ensure certainty of feedstock availability for its
performance across markets in Africa; integrated Rice farming and milling in Nigeria expanded milling capacity in 2022.
also fared better than 2020.
• Sesame underperformed and has since been restructured to focus on trading from
selected origins and value-added processing in Nigeria.
Note: The segment now includes specialty grains and seeds, such as sesame, chia seeds 35
and quinoa, which were previously under ofi.Olam Agri: Fibre, Agri-industrials & Ag Services
S$ Million
EBIT Invested Capital
Working Capital
+49.7% +49.4%
Fixed Capital
+256.9% +50.6%
211 2,317
1,538
94 1,038 1,894
59 1,073
689
349 465 423
Restated 2019 Restated 2020 2021 Restated Restated Dec-21
Dec-19 Dec-20
EBIT/MT (S$) 47 29 95 EBIT/IC
10.2% 4.6% 10.9%
• EBIT more than trebled during the year: Strong recovery in cotton demand with • IC was significantly higher by 50.6% during 2021 mainly due to working
significant improvement in capacity utilisation of textile mills in the major textile capital rising as a result of the decade-high cotton prices in Q4 2021 as
producing centres
well as prepayment for cotton purchases to secure the contracts.
• The Rubber processing business in Cote d’Ivoire benefited from improved
volumes and margins as prices rebound; sustainable forestry concessions and
saw milling operations in the Republic of Congo fared better.
• Commodity Financial Services had a steady performance in 2021.
36Remaining Olam Group
S$ Million De-prioritised/Exiting Assets Gestating Businesses Incubating Businesses (including corp adjustments)
EBIT Invested Capital
-16.2% -18.0%
3,674
-35 -27 3,143
-46
1,251
-1 923 2,578
-45 564
-87 -102
-91
2,423 2,219 2,000
-56
-77
-177
Restated Restated Dec-21
-206 Dec-19 Dec-20
Restated 2019 Restated 2020 2021 EBIT/IC -2.4% -5.2% -7.2%
• EBIT losses increased to S$205.6 million in 2021 as it continued to invest in • IC decreased by 18.0% primarily on divestments, closures and the
developing Gestating Assets to maturity and incubating new Engine 2 related restructuring.
initiatives.
• Lower losses from De-prioritised/Exiting Assets in 2021 was primarily due to
lower operational losses from NZFSU and Wood Products business in
Southeast Asia, and higher profits from Edible Oil processing in Mozambique.
• Gestating Assets reported higher losses due to higher period costs at OPG,
reduced industrial activities by ARISE group, offset by better performance in Note: 2020 financial results for the operating groups have been re-stated to reflect intra- 37
Packaged Foods group adjustments. Results of Gestating Businesses include those of shared services
Olam Group Limited Investor Presentation | May 2022 provided by OTBS.Business prospects and outlook
Russia-Ukraine conflict
• ofi operates a dairy farming operation and an agri-farming operation to mainly grow the feed for our dairy herd in Russia. It also imports and
distributes cocoa, coffee, dairy products and nuts into Russia. In Ukraine, it imports and distributes cocoa, dairy products and nuts. Olam
Agri exports grains and oilseeds, including wheat, barley, corn and sunflower oil from both Russia and Ukraine. In Russia, it operates an
export terminal in Azov. In Ukraine, it operates warehouses, silos and a grains elevator in Kyiv. The Remaining Olam Group does not have a
presence in Ukraine or Russia.
• In 2021, our direct exposure to these two countries accounted for 1.0% of Group volumes, 0.8% of Group revenue and 2.7% of Group
invested capital. However, the ramifications of this conflict has significant consequences for the broader grains & oilseeds markets beyond
just Russia & Ukraine.
• One of the key objectives of Olam Group’s Purpose is to strive for a more food secure future for all which has been severely impacted by
this conflict as an estimated 400-500 million people are food dependent on this region. In line with our Purpose, we will focus only on those
activities that are directly associated with our duty of care to our employees, our dairy herd, our farmer suppliers, and the customers we
serve for essential food and basic nutrients.
• In Russia, ofi continues to supply milk from its dairy farm to its customers in the domestic market. We have ceased imports of other ofi
products into Russia. For Olam Agri, there has been a severe disruption of the export of grains and oilseeds from both countries. With the
closure of ports in the Azov Sea, we have stopped operating our export terminal in Azov.
• While the situation remains extremely fluid and the market risks and opportunities remain uncertain, we will continue to monitor the situation
closely in Russia and comply with all applicable sanctions, laws, and regulations. We are actively managing our risks and exposures arising
out of this conflict.
• In Ukraine, our first concern and overriding priority remains the safety, health and wellbeing of our people and their families. As all the ports
have been shut down by the government, all our operations in the country, including imports, exports and grains elevator, have currently
ceased operations.
• To support humanitarian efforts in the region, we are committing US$5 million to emergency aid initiatives with international partners,
including the World Food Programme and UNICEF. We have also launched an employee giving drive, where all money raised will go directly
to supporting UNICEF’s critical work on the ground. Every US$1 donated by employees is matched by the Group to further provide
assistance to those most in need.
Olam Group Limited Investor Presentation | May 2022Business prospects & outlook (cont’d)
• The growth momentum that we saw in Q4 2021 and the first two months of Q1 2022 has now given way to slowing growth, high
inflation in most countries that we operate in, accompanied by hard pandemic lockdowns in China.
• Despite these developments, the Olam Group has had a good start to the year with Q1 2022 EBITDA growing 54% over last year.
• ofi has had a steady start in Q1 2022 and will deliver on plan and slightly ahead of last year with the business being well positioned
to contend with the current macro economic conditions and geo-political uncertainties due to the Russia-Ukraine conflict. ofi is
working closely with its customers to manage the inflationary pressures in input raw material prices and higher logistics costs.
• ofi intends to seek a primary listing in London, and a concurrent secondary listing in Singapore. However, in light of current market
conditions as a result of the ongoing conflict in Ukraine, we do not currently expect the IPO of ofi to take place during Q2 2022, as
previously planned. We remain committed to pursuing a public listing of the ofi business and will evaluate the appropriate timing of
such a listing on an ongoing basis, taking into account prevailing market conditions.
• Olam Agri has more than doubled its EBITDA in Q1 2022 compared to the prior year with broad based performance from all of its
platforms.
• The Remaining Olam Group’s performance in Q1 2022 was marginally lower than Q1 2021.
• Given the rising commodity price environment, we will continue to focus on operating and managing our working capital in a
disciplined fashion.
• As the Group continues to execute the Re-organisation Plan, it is expected to continue to incur one-off and non-recurring expenses
associated with the carve-out, listing and de-merger plans in 2022.
• Overall, given the strong start to the year and barring unforeseen circumstances, including adverse impacts of the Russia-Ukraine
crisis on the markets, new Covid-19 variants of concern and consequent hard lockdowns across the world, we are cautiously
optimistic about the economic outlook and prospects for the Group for 2022, with the industry continuing to see strong demand and
tight commodity supplies amid supply chain disruptions.
Olam Group Limited Investor Presentation | May 2022Governance Board of directors Olam Group Limited Investor Presentation | May 2022 40
Governance
Five Board Committees oversee risk management
• Trading: e.g. Price, • Operational: Stock, • Operational: Project • Agricultural: Weather, • Key Persons
Basis, Liquidity Quality, Fraud, Execution, Asset Pests, Diseases,
• Operational: Credit, Systems & Controls Utilisation Agronomy
Counterparty, • Regulatory & • Currency: Translational • Reputational: Social,
Transactional Currency Compliance: Currency Health, Safety,
• Bribery/Corruption, Environmental
Political & Sovereign • Capital Structure &
Transfer Pricing,
• Regulatory & Financing: Interest Rate,
Taxation
Compliance: Market Funding Liquidity/Margin
Compliance • Others: Cybersecurity, Call; Credit Metrics, All strategic risks are overseen by the
IT Activist Investor, Short
• Natural Perils Seller Attack
Executive Committee
Olam Group Limited Investor Presentation | May 2022 41Governance: Living our Purpose Sustainability Framework Olam Group Limited Investor Presentation | May 2022 42
Recognitions
• Featured in 2021’s Fortune Global 500
• IR Magazine Southeast Asia Awards 2020 and 2019: Best Annual Report (Mid-cap)
• The Asset Triple A Country Awards 2020: Best Issuer for Sustainable Finance and Best Sustainability-
linked Loan
• Singapore Corporate Awards 2019, Best Annual Report (Silver)
• Top 30 ASEAN public listed companies in corporate governance practices 2019
• ASEAN Business Advisory Council (ASEAN-BAC) AGROW Awards 2018: Champion Inclusive Agri-
business
• Africa CEO Forum Awards 2018: International Company of the Year
• Singapore Sustainability Reporting Awards (SSRA) 2018 by Singapore Institute of Directors, SGX and
Global Compact: Best Sustainability Report for Established Reporters
• Winner of Sustainability Award, Runner-up of ‘Most Transparent Company’ Award, Commerce, SIAS 19th
Investors’ Choice Awards 2018
• Sustainable Business Award, Large Organisation category, Singapore Apex Corporate Sustainability
Awards, 2017
Olam Group Limited Investor Presentation | May 2022 43Olam Investor Presentation olamgroup.com/investors.html ir@olamnet.com
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