It was impressive that Mr Hildebrand said that RIC remained disciplined and the Board needed to be convinced of the metrics for potential acquisitions, as he said there was plenty to occupy RIC in growth for the next while.
He did however remark that with the cost of debt rising, the expectations of vendors may become more realistic. The CFO said that RIC had a strong balance sheet.
The Narangba packing line project (Brisbane, Queensland) has one packaged dog food contract, not the two originally flagged. It has the benefit of being removed from the extruder, giving extra capacity given it's operating at capacity. Total dog food sales are on track relative to the RIC budget expectations. It's pretty robust, the CEO said. Growth capex was A$6 million for Narangba, but it wasn't an RIC 'Boost' project: it was $6 million in investments for a six-year payback period. $2 million of the $6 million remains to be spent: this will occur in 1H 24.
The premiumisation strategy is still quite 'immature' in terms of the journey. Raw materials from abattoirs into the rendering plants are varied: there's opportunities to have more ash products or higher protein products: RIC is having conversations with suppliers. Only 40 per cent of RIC's 'material' (inputs) is premium compared to European and USA similar operators.
Overall quite technical, but very positive. Questions concluded at 1055 AEST.
There is an investor roadshow scheduled in a couple of weeks' time.
RIC Price at posting:
$2.03 Sentiment: Hold Disclosure: Held
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(20min delay)