Board of Directors Meeting Tuesday 8th September 2015 Meeting No: 15/7 Item Number: MD/CEO Report

AUSTRALIAN AG R ICU LTU RAL COMPANY LIMITED

Financial Results Presentation for the Half Year ended 30 Sept 2015



Jason Strong Managing Director


25 November 2015


co

AA.

Important information


Summary information only

This presentation contains general information about the Australian Agricultural Company Limited and its consolidated entities ('AACo') and its activities current as at the date of this presentation. It is provided in summary and does not purport to be complete.


You acknowledge and agree that you will rely on your own independent assessment of any information, statements or representations contained in this presentation and such reliance will be entirely at your own risk.


Disclaimer

AACo and its related bodies corporate and associated entities and each of their respective officers, employees, associates, agents, auditors, independent contractors and advisers, do not make any representation, guarantee or warranty, express or implied, as to the accuracy, completeness, currency or reliability (including as to auditing or independent verification) of any information contained in this presentation and do not accept, to the maximum extent permitted by law:

  1. any responsibility arising in any way for any errors in or omissions from any information or for any lack of accuracy, completeness, currency or reliability of any such information made available;

  2. any responsibility to provide any other information or notification of matters arising or coming to their notice which may affect any information provided; and

  3. any liability for any loss or damage (whether under statute, in contract or tort for negligence or otherwise) suffered or incurred by any person as a result of or in connection with a person or persons using, disclosing, acting on or placing reliance on any information contained in this presentation, whether the loss or damage arises in connection with any negligence, default or lack of care or from any misrepresentation or any other cause.


Forward-looking statements

This presentation may contain forward-looking statements. All statements other than statements of historical facts included in this presentation are forward-looking statements. Forward- looking statements may include, without limitation, statements relating to AACo's financial position and performance, business strategy, plans and objectives of management for future operations. Forward-looking statements involve known and unknown risks, uncertainties and other factors (many of which are beyond AACo's control) and which may cause actual results to differ materially from those expressed in the statements contained in this presentation. Some of the important factors that could cause AACo's actual results, performance or achievement to differ materially from those in any forward-looking statements include (among other things): levels of demand and market prices, climatic conditions, the impact of foreign exchange currency rates on market prices and operating costs, political uncertainty and general economic conditions in Australia and overseas, the ability to produce, process and transport goods and livestock profitably, the actions of competitors and activities by governmental authorities. No representation, guarantee, or warranty (express or implied) is given as to the accuracy, completeness, likelihood of achievement or reasonableness of any forecasts, projections or forward-looking statements contained in this presentation.


Except as required by applicable regulations or by law, AACo does not undertake any obligation to publicly update or review any forward looking statements, whether as a result of new

information or future events.


This presentation should not be relied upon as a recommendation or forecast by AACo.


No offer of securities

Nothing in this presentation should be construed as either an offer to sell or a solicitation of an offer to buy or sell AACo securities in any jurisdiction.


2



Safety


Financial


Operational


Strategy

  • Improvement in LTIFR by > 40%.

  • Ongoing focus and a critical component of our approach


  • 71% ($107.2 million) increase in total sales

  • Operating EBITDA2 of $11.5 million compared to a loss of $8.2 million

  • Statutory EBITDA2 of $92.1million compared to a loss of $4.5 million

  • 95% improvement in Net Operating Cash Flow


  • 114% (13.7 million kg CW) increase in total meat & by-product sales volumes

  • Wagyu meat & by-product sales prices increased 6%

  • Shortfed/Other meat & by-product sales prices increased 10%

  • Northern Beef made a positive contribution to Consolidated Operating EBITDA

  • 190% increase in net transfers of cattle from Grassfed to Grainfed & Northern Beef


  • AACo's objective remains clear: a fully integrated branded beef business

  • The strategy is now focussed on further increasing operating margin by:

    • Implementing a differentiated branding strategy

    • Investing in innovation and technology

    • Optimising our supply chains



  1. Compared to the prior corresponding period (H1 FY15)

  2. Operating EBITDA assumes all balance sheet inventory movements occur at a pre-defined standard price, in contrast to Statutory EBITDA which recognises unrealised 3

movements in inventory at market price. For a full explanation of this measure refer to Section 5 of the Operating Financial Overview in AACo's 31 March 2015 Annual Report.


Total sales revenue ($m)


177 151 258 Before H1 FY14


PCP H1 FY15


Now H1 FY16


Meat1 sales as a % of revenue

47% 76% 84%


Net internal transfers of cattle from Grassfed to Grainfed / Northern Beef (mil kg LW)

12 8 24


Grassfed cow breeding herd ('000 head)

168 178 173


Average age of Grassfed cow breeding herd (years)

~7~7~6


1. Meat includes red meat, by-products and offal. 4

distributed by