UEM Edgenta Berhad 52nd Annual General Meeting

UEM Edgenta Berhad
(formerly known as Faber Group Berhad)
52nd Annual General Meeting
Persada Plus
25th May 2015
Contents
1. Overview of UEM Edgenta
2. Key Highlights FY2014
3. Financial Results FY2014
4. Business and Operations Updates
5. Outlook and Strategy
Section 1
Overview of UEM Edgenta
INTRODUCING UEM EDGENTA
We are now a Total Asset Management Company
with strong presence in the healthcare,
infrastructure and commercial sectors.
3
VISION MISSION AND VALUES
OUR
VISION
OUR
MISSION
Optimising assets to
improve lives
Our services,
commitment to smarter
thinking and improved
solutions place us at the
forefront of the industry.
We create opportunities
for clients and assets
that positively influence
society.
OUR
VALUES
•
Teamwork
•
Integrity
•
Passion
•
Success
4
UEM EDGENTA AT A GLANCE
5
WHAT DO WE DO?
UEM Edgenta now comprises
6 Core Business Units which
cover the entire asset life cycle
5. Infra Services
• Pavement
• Railway
• Bridges
• Airports
1. Healthcare Services
2. Facilities Services
3. Energy Services
4. Industrial Services
6. Asset Consultancy
Asset Life Cycle Model
• Project management
• Design & Consulting services
• Asset Maintenance Programmes
6
SELECTED ON-GOING PROJECTS
CIKAMPEK-PALIMANAN EXPRESSWAY
LRT 2 EXTENSION
NSE FOURTH LANE WIDENING
WOMEN AND CHILDREN’S HOSPITAL
7
5-YEAR GROUP FINANCIAL HIGHLIGHTS
Revenue (RM mil)
Profit Before Tax (RM mil)
Total Assets (RM mil)
Earnings Per Share (RM Sen)
Note: The 5-Year Group Financial Summary is based on Annual Audited Financial Statements for the respective years. For the purpose of this annual report, the impact of the
pooling of interest method on the acquisition of Opus Group Bhd and Edgenta PROPEL Bhd (formerly known as Project Penyelenggaraan Lebuhraya Bhd) has not been
reflected for the years 2010, 2011 and 2012.
8
CORPORATE STRUCTURE
ASSET CONSULTANCY
HEALTHCARE SERVICES
INFRA SERVICES
FACILITIES SERVICES
PROPERTY DEVELOPMENT
100%
Opus Group Berhad
100%
Edgenta Healthcare Management Sdn Bhd
(formerly known as Faber Healthcare
Management Sdn Bhd)
100%
Edgenta PROPEL Berhad
(formerly known as Projek
Penyelenggaraan Lebuhraya
Berhad)
100%
Edgenta Facilities Sdn Bhd
(formerly known as Faber
Facilities Sdn Bhd)
100%
Faber Development Holdings
Sdn Bhd
100%
Opus International (M) Berhad
100%
Opus Management Sdn Bhd
100%
Soil Centralab Sdn Bhd
Other Subsidiaries
100%
Opus International (NZ) Limited
(New Zealand)
61.22%
Opus International
Consultants Limited
(New Zealand)
43%
57%
Edgenta Mediserve Sdn Bhd
(formerly known as Faber Medi-serve
Sdn Bhd)
100%
Edgenta Mediserve (Sabah) Sdn Bhd
(formerly known as FMS Services
(Sabah) Sdn Bhd)
40%
Sedafiat Sdn Bhd
100%
Edgenta Mediserve (Sarawak) Sdn Bhd
(formerly known as FMS Services
(Sarawak) Sdn Bhd)
40%
One Medicare Sdn Bhd
100%
Cermin Cahaya Sdn Bhd
Other Subsidiaries
Other Subsidiaries
100%
Aquatrans Sdn Bhd
100%
Edgenta Facilities
Management Sdn Bhd
(formerly known as Faber
Facilities
Management Sdn Bhd)
100%
Faber Star Facilities
Management Limited
(India)
51%
Faber Sindoori
Management Services
Private Limited
(India)
Other
Subsidiaries
100%
Faber Union Sdn Bhd
100%
Country View Development
Sdn Bhd
100%
Faber Grandview
Development (Sabah)
Sdn Bhd
100%
Faber Heights Management
Sdn Bhd
55%
Rimbunan Melati Sdn Bhd
75%
Faber L.L.C
(UAE)
100%
Edgenta Healthtronics Sdn Bhd
(formerly known as Healthtronics
(M) Sdn Bhd)
60%
Fresh Linen Services (Sabah) Sdn Bhd
Updated as at 22 May 2015
9
Section 2
Key Highlights FY2014
COMPLETION OF MERGER IN OCT 2014
REBRANDED TO UEM EDGENTA IN APRIL 2015
5 Aug 2013
Proposal from
UEM Group for the
RM1.15bil
proposed merger
with
Opus and PROPEL
18 Apr 2014
Faber enter into
conditional share sale
agreement with
UEM Group for the
acquisition of Opus and
PROPEL
26 Jun 2014
Faber’s shareholders’
approval obtained for
the proposed merger
29 Oct 2014
Completion of
Merger with Opus
and PROPEL
9 Apr 2015
Faber officially
rebranded as
11
RESULTS HIGHLIGHTS
•
Full consolidation of PROPEL and OPUS
financials
and
REVENUE RM3.09 bil
▲ 14.4%
Full year dividend of 23 sen representing
payout ratio of 92%
EBITDA RM366.7 mil
▲ 6.4%
 FY2014 Revenue, EBITDA, PBT
PATANCI are all up against FY2013
 EPS of 24.88 sen
•
•

Special dividend of 18 sen paid on 22 Jan
2015

Final dividend of 5 sen to be paid upon
approval by shareholders in the AGM
PBT RM324.5 mil
▲ 2.3%
Strong Balance Sheet and cash flow generation

Net cash generated from operating activities
are in excess of RM300 mil

Net cash position with high interest coverage
ratio (22x)
PATANCI RM202.4 mil
▲ 6.3%
12
SELECTED MAJOR NEW CONTRACTS SECURED
RM1.03 bil Asset
Management Services for
Women and Children’s
Hospital
over a period of 27 years
Opus IC secured 6 out of 9
new NZTA highway
maintenance and
operations contracts
(>NZD35 million in fees over
the next 7 years)
Runway upgrade for KLIA;
and
RM3.07 bil 10-year new
Concession Agreement for
Hospital Support Services
NZD20 million, 5-year
contract by the Royal
Commission
for Jubail and Yanbu in
Kingdom of Saudi Arabia
Infra works related
to the
Integrated Pengerang
Complex Project
Kampung Sg. Serai –
Rawang Highway Exit on
NSE
13
Section 3
Financial Results FY2014
GROUP FINANCIAL HIGHLIGHTS
Group Revenue and PATANCI grew by 14.4% and 6.3%
Variance
Figures in RM Million unless otherwise
stated
FY2014
Revenue
3,089.3
2,699.7
389.6
▲14.4%
Gross Profit
981.3
883.1
98.2
▲11.1%
Gross Margin (%)
31.8%
32.7%
-
▼0.9%
PBT
324.5
317.2
7.3
▲2.3%
PBT (%)
10.5%
11.7%
-
▼1.2%
PAT
241.9
229.8
12.1
▲5.3%
PAT (%)
7.8%
8.5%
-
▼0.7%
PATANCI
202.4
190.4
12.0
▲6.3%
PATANCI (%)
6.6%
7.1%
-
▼0.5%
EPS (Sen)
24.88
23.41
1.47
▲6.3%
Liquidity Ratio
0.9x
1.0x
-
-
Gearing Ratio
0.3x
0.1x
-
-
Return on Equity (ROE)
15.9%
14.4%
-
-
Return on Invested Capital (ROIC)
16.5%
16.1%
-
-
FY2013
Amount
%
15
FY2014 REVENUE BREAKDOWN
53% of revenue was generated from AC; 36% contribution from Concession
TOTAL REVENUE
RM3.09 bil
Healthcare &
Facilities Services
(“IFM”)
Property Development
Property Development
1%
1%
Concession
36%
22%
SERVICES
53%
63%
24%
Infra
Services
(“IS”)
SECTORS
Asset
Consultancy
(“AC”)
Non-Concession
16
REVENUE BREAKDOWN
53% of revenue were generated domestically
47% of revenue from international presence
United Kingdom
Canada and USA
RM134mil (4%)
Malaysia
RM1,628mil (53%)
RM372mil (12%)
Australia
RM175mil (6%)
New Zealand
Note: Contribution from UAE and Indonesia are less than 1%
RM779mil (25%)
17
YOY REVENUE
Higher revenue contributed by AC and IS divisions of RM284mil and RM102mil
respectively
▲ RM389.6mil (14%)
102.0
3,089.3
283.8
2,699.7
Dec-13
IFM
Slight increase due to
higher Variation Orders
and reimbursable works
for government hospital
(15.6)
19.4
IFM
AC
AC
Higher revenue mainly
due to consolidation of
full year results of Opus
SW (RM209 mil) and
strengthening of NZD
against MYR (RM67 mil)
IS
Property
Dec-14
IS
Property Development
Higher revenue by mainly
due to highway road
maintenance works and
Fourth Lane Widening
project
Decline in revenue due to
lower sales in view of
challenging market
condition
18
YOY PROFIT BEFORE TAX (PBT)
PBT is marginally higher by RM7.3mil due to set off of higher contribution by AC
and IS and lower contribution from IFM
▲ RM7.3mil (2%)
20.2
317.2
-3.0
32.1
324.5
-8.1
-33.9
Dec-13
IFM
AC
IFM
AC
Lower PBT due to reversal of
over accrued cost for UAE
project of RM10.2mil and oneoff linen loss claimed of
RM13.3mil in FY2013, and
higher incineration &
transportation costs incurred on
clinical waste in Sabah of
RM11.4mi
Higher PBT by RM32.1mil
contributed from higher
revenue on new projects
secured, lower professional
fees incurred through
maximizing utilisation of
internal resource & reversal of
deferred consideration arising
from acquisition of Opus
Stewart Weir
IS
Property
IS
Higher PBT due to more work
progress and certifications for
Fourth Lane Widening and
Coastal Road projects
Others
Dec-14
Property Development
Lower PBT flow through of
lower revenue contribution for
property development
19
DIVIDENDS
For the past 5 years, the company has declared a total gross dividend of 79 sen1
amounting to net payout of RM349 million
75%
28%
37%
92%
58%
25%
20%
20
18
8
8
10
10
2010
2011
2012
2013
Final Dividend
Special Dividend
Net Payout Ratio (ex Special Dividend)
5
2014
Net Payout Ratio (inc Special Dividend)
92% PAYOUT RATIO FOR FY2014
For FY2014, the total dividend declared is 23 sen, representing payout ratio of 92%. Excluding
special dividend, the payout ratio will be 20%
Note: 1) Dividends paid between 2010 to 2012 are gross dividend while dividends declared and/or paid in 2013 to 2014 are single-tier (net) dividend
20
SHARE PRICE PERFORMANCE
UEM Edgenta’s share hit a record high intra-day price in the past 52 weeks @ RM3.85 on 21st
May 2015; also the highest recorded price in the last 15 years
4.00
30
3.50
25
3.00
20
2.50
15
2.00
10
1.50
5
1.00
-
Volume
Source: S&P Capital IQ
Million
SHARE PRICE AND VOLUME (1ST APRIL 2013 – 22ND MAY 2015)
Share Price
Share Price (Closing Price)
Price
Date
Highest
3.81
21 May 2015
Lowest
1.48
2 May 2013
21
CAPITAL APPRECIATION
Market Capitalisation grew by more than 3.7x in under 3.5 years. Total shareholders return for
the past 2 years significantly outperformed FBMKLCI by ~170%
TOTAL SHAREHOLDERS RETURN VS FBMKLCI
(1ST APRIL 2013 – 22ND MAY 2015)
MARKET CAPITALISATION
376% (RM2,441.5 mil)
3,091.3
UEM Edgenta
200%
FBMKLCI
+184%
180%
160%
140%
2,220.9
120%
100%
80%
60%
925.7
40%
649.8
20%
526.4
+15%
0%
Source: Bloomberg and S&P Capital IQ
Apr-15
Jan-15
Oct-14
Jul-14
22-May-15
Apr-14
Dec-14
Jan-14
Dec-13
Oct-13
Dec-12
Jul-13
Dec-11
Apr-13
-20%
22
Section 4
Business and Operations Updates
ASSET CONSULTANCY
Opportunities exist in transportation sector which will drive the growth of AC
Sector
Significant opportunities exist in
the market, especially in the
transportation sector
Position to bid for further large
country council transport asset
management contracts
Expected to match 2014’s
performance even though
Alberta govt. expenditure
on O&G projects might be
affected by global oil crisis
Well positioned as a
potential key partner in
the proposed Pan Borneo
highway
Developing a new
pavement research
centre to lead new
technology development
Strong growth potential in
infrastructure sector
supported by both public
and private investment
Opportunities exist specifically in
transportation sector supported by
Government spending
Restructuring and cost cutting
exercise of 2014 expected to
manage performance for 2015
Strong growth outlook – 6 further Network
Outcome Contracts for the NZTA are
coming to market in 2015
24
INFRASTRUCTURE SERVICE
Positive outlook for 2015 as new infra development projects roll out and
expansion into new segments/markets continue
Business & Operations Updates
•
Continued strong growth in revenue driven by large
infrastructure projects such as 4th Lane Widening (expected
completion in 3Q2015) and Coastal Road in Penang
2015 Outlook
•
Strong growth in infrastructure spending expected to boost
revenue growth. Expected projects to be rolled out in 2015 –
Pan Borneo Highway, SKLIA Expressway
•
Exploring new business opportunities in the utilities relocation
segment
•
To strengthen regional presence by exploring opportunity to
provide O&M services to the soon to be completed CikampekPalimanan Expressway in Indonesia
25
HEALTHCARE SERVICES AND FACILITIES SERVICES
nCA signed on 11 March 2015 for concession period of 10 years
• New Concession Agreement with Ministry of Health executed on 11 March
2015 for concession period of 10 years.
• Edgenta Mediserve shall be the HSS concessionaire for government hospital
in the northern region and 40% equity stake in each of the concessionaire JVs
for HSS in Sabah and Sarawak
Company
UEM Edgenta’s
Shareholding
Region
No of
Hospitals
Edgenta Mediserve
100%
Northern Region
of Peninsular
Malaysia
32
Sedafiat Sdn Bhd
40%
Sabah
26
One Medicare Sdn Bhd
40%
Sarawak
23
• To ensure no interruption to the HSS services and operations with the
changing of the East Malaysia concession companies, the JVs co will
outsource all HSS to Edgenta Mediserve for a period of 6 months at the below
fees:
 Sabah (by Sedafiat)
RM77.7 million
 Sarawak (By One Medicare)
RM68.0 million
26
Section 5
Outlook and Strategy
OUTLOOK AND STRATEGY
Continue
Integration efforts
of combined
entity
Business Model
Improvement
New Business
Initiative
• Streamline and improve the internal operations and
processes.
• Engage employees to embrace the new vision, mission
and values
• Strong focus on operational efficiency, procurement and
cost model (i.e. set up of premix plant)
• Improve delivery and technology utilisation
• Infra Services: Expansion into utilities relocation
• Facilities Services: Township management services
• Industrial Services: Penetrate O&G sector
• Energy Services: Rollout Control & Monitoring services
Strengthen
International
Presence
• To strengthen presence in selected countries i.e.
Indonesia and Middle East which have high growth
potential
28