Download 25 August 2017: 2017 AGM CEO Presentation PDF Document

Thank you Laurie. Good morning everyone.

As always, I am delighted to be here again today and would like to welcome you all to Jerilderie and SunRice's AGM.

By the end of my presentation today, I hope to have provided you with an overview of several issues:

• Firstly, how SunRice demonstrated commercial resilience during Financial Year 2017 in the face of a 'perfect storm' caused by difficult trading conditions and other market headwinds;

• Secondly, how we successfully established a new, large-scale supply chain in Vietnam;

• Thirdly, how, having undertaken a considerable strategic refresh over the past year, the Company is now poised to return to another period of growth;

  AND

• Finally, I will provide you with profit guidance on the C17 crop year and also outline how we are encouraging our growers to focus on high value varietals for C18.

  So here is the slide of metrics I put up every year that provides a snapshot of SunRice's financial performance and how this has impacted on both A Class shareholders - our growers - through the paddy price, and B Class investors

  - those of you who have invested in the Company, in order to earn a return on capital through the dividend and share price growth.

  Group consolidated revenue eased off record levels in Financial Year 2016 and declined by 12% to $1.1 billion.

  Following three years of growth, SunRice net profit after tax declined by 34% to $34.2 million.

  Despite this softer financial result, for our SunRice B Class Shareholders - and it is important to note that a significant number of these are also current A Class shareholders - we were able to maintain the dividend level at 33 cents per share for Financial Year 2017, which represented a payout ratio of 54%.

  On a share price of $4.28 - the price on the last day of the 2017 financial year

  - this dividend represented an impressive fully franked yield of almost 8%.

  For our growers, the Paddy Price for medium grain Reiziq for the 2016 Crop (marketed in Financial Year 2017) was fixed at $415 per tonne, which translated to a total $101 million paid out to growers.

  The softer financial results for the year should have come as no surprise. At the last Annual General Meeting, most of my presentation was focused on the emerging and growing headwinds that SunRice was facing in both global and domestic markets.

  After five years of improving financial performance and market expansion, 2017 was always going to be pivotal for SunRice, as a range of external factors combined to create the 'perfect storm' - and I promise that is the last time I use that phrase during this presentation and, hopefully, for some time to come. These factors were numerous and included:

• The need for SunRice to manage a lower C16 crop;

• The dire macroeconomic situation in Papua New Guinea impacting on Trukai;

• The dairy industry slump in Australia impacting on CopRice; and

• The mining downturn and foodservice consolidation affecting Riviana.

This time last year when I stood in front of you, medium grain prices were depressed as global paddy production and stockpile levels reached record highs, and the outlook was for further deterioration.