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Aboitiz Equity Ventures First Quarter 2016 Financial & Operating Results 6 May 2016

Transcript of Aboitiz Equity Venturesaboitiz.com/wp-content/uploads/2014/10/AEV-1Q2016-Financial... · Aboitiz...

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Aboitiz Equity Ventures

First Quarter 2016Financial & Operating Results

6 May 2016

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AGENDA

• Review of Business Units

• Power

• Banking & Financial Services

• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

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AGENDA

• Review of Business Units

• Power

• Banking & Financial Services

• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

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DistributionGeneration AP Parent & Others

Net income up on strong performance by the generation and distribution segments

812 851

3,573 4,189

1Q2015 1Q2016

5,016EPS = P0.68

15%

+17%

+5%

4,347EPS = P0.59

FINANCIAL HIGHLIGHTS

NET INCOME (in Php million)

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DistributionGeneration AP Parent & Others

Non-Recurring Items1Q2015 1Q2016

AP Parent (1) (15)

AP -Gen 13 257

Total Gains/(Losses) 11 242

Core net income up on higher sales from the Coal and Large Hydro Units

812 851

3,561 3,932

1Q2015 1Q2016

4,774EPS = P0.65

10%

+10%

+5%

4,335EPS = P0.59

FINANCIAL HIGHLIGHTS

CORE NET INCOME (in Php million)

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Cash generation continued to be strong

1,265 1,325

7,239 8,096

1Q2015 1Q2016

9,526

+12%

+5%

8,531

12%

DistributionGeneration AP Parent & Others

FINANCIAL HIGHLIGHTS

BENEFICIAL EBITDA (in Php million)

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Balance sheet continued to be strong with low gearing

FINANCIAL CONDITION

YE2015 1Q2016 YE2015 1Q2016

Cash and Equivalents 13,841 14,024 51,098 67,040

Investments and Advances 70,373 70,490 22,555 22,503

Total Assets 85,574 86,177 242,489 265,725

Total Interest Bearing Debt 9,911 9,914 114,612 129,283

Total Liabilities 22,613 34,817 140,876 171,479

Net Debt - - 63,514 62,243

Total Equity 62,962 51,360 101,614 94,245

Current Ratio 1.2x 0.6x 3.1x 2.3x

Net Debt to Equity -0.1x -0.1x 0.6x 0.7x

PARENT CONSOLIDATEDBALANCE SHEET

(in m illion pesos)

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176 135

540 549

943 1,151

144179

1Q2015 1Q2016

Capacity Sales Breakdown by Profile (MW)

Spot Market Energy Contracts

Capacity Contracts Ancillary

2,0141,804 12%

Capacity Sold Factor

Fuel Group 1Q15 1Q16Change in % points

MINI HYDRO 29% 25% -4

LARGE HYDRO 65% 73% 8

SNAP Magat 55% 64% 9

SNAP Benguet 79% 84% 5

GEOTHERMAL 77% 76% -1

COAL 95% 94% -1

Therma Luzon 94% 91% -3

Therma South 100% -

OIL 97% 96% -1

83% 83%CapacitySold Factor

Capacity sales growth driven by Therma South and SNAP

OPERATING HIGHLIGHTS: GENERATION

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Fuel GroupBeneficial

Total Energy Sales(GWh)

BeneficialAncillary Sales

(GWh)

1Q15 1Q16 YoY Chg 1Q15 1Q16 YoY Chg

MINI HYDRO 75 71 -5%

LARGE HYDRO 169 178 5% 243 296 22%

SNAP Magat 79 105 33% 135 145 7%

SNAP Benguet 90 74 -18% 108 151 40%

GEOTHERMAL 663 667 1%

COAL 1,533 2,055 34%

Therma Luzon 1,317 1,300 -1% 69 94 36%

Therma South - 499 -

OIL 388 478 23%

AP – GENERATION 2,828 3,451 22% 312 390 25%

Volume growth driven by the Coal, Large Hydro and Oil Business Units

OPERATING HIGHLIGHTS: GENERATION

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MAGAT’S WATER LEVEL VS. RULE CURVE (in MASL)

Dry Spell to persist until mid-2016

OPERATING HIGHLIGHTS: GENERATION

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OPERATING HIGHLIGHTS: GENERATION

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In Peso/kWhBilateral

ContractsSpot Market

Weighted Average

Ancillary

1Q15 1Q16 1Q15 1Q16 1Q15 1Q16 1Q15 1Q16

AP GENERATION GROUP 4.54 4.09 5.17 2.99 4.63 4.00 2.08 2.08

SNAP Magat 4.95 4.82 6.71 3.36 5.18 4.67 2.24 2.46

SNAP Benguet 4.75 4.68 9.15 5.38 4.88 4.72 2.19 1.91

Therma Luzon* 3.93 3.76 6.21 3.28 4.18 3.72 1.61 1.75

Therma South - 4.58 - - - 4.58

APRI** 4.45 3.74 4.18 2.60 4.36 3.46

Note: Fuel cost and purchased power:*TLI: P1.47/kWh (1Q2016) versus P1.52/kWh (1Q2015)**APRI: P1.37/kWh (1Q2016) versus P1.79/kWh (1Q2015)

Average selling price dropped amid declining fuel cost

OPERATING HIGHLIGHTS: GENERATION

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2,790 3,142 3,322 3,606 3,727 3,934 4,076 4,480 4,759

1,111 1,201

2007 2008 2009 2010 2011 2012 2013 2014 2015 1Q2015 1Q2016

OPERATING HIGHLIGHTS: DISTRIBUTION

12

334 435

24 98 94

22 28 23

1,060

349

497

24 102 100

21 30 27

1,151

DavaoLight

VECO CotabatoLight

SFELAPCO SEZ MEZ BEZ LEZ Total

1Q2015 1Q2016

270

841

1,111

300

900

1,201

Residential Commercial &Industrial

Total Power Sales

1Q2015 1Q2016

BENEFICIAL POWER SALES (GWh)

BENEFICIAL GWH SALES GROWTH(BY CUSTOMER TYPE)

PEAK DEMAND (MW)

9%

8%

8%

11%

7%

Power sales grew across all customer segments

OPERATING HIGHLIGHTS: DISTRIBUTION

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2%

1% 1%

3%

7%

6%

8%8%

1%1% 1%

3%

5%

7% 7%

6%

13

Gov’t Cap – 8.50%

SYSTEMS LOSSGROSS MARGIN / KWH SALE

SFELAPCOSEZ Davao Light VECO CotabatoLight

MEZ BEZ

1.44

1.60

1.77

1.71

1.61

1.46

2011 2012 2013 2014 2015 1Q2016

1Q2016

1Q2015

LEZ

Gross margin down on continued operations of embedded plant

OPERATING HIGHLIGHTS: DISTRIBUTIONOPERATING HIGHLIGHTS: DISTRIBUTION

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SaCaSun – 46 MW 75-hectare at Barangay Punao, San Carlos City, Negros Island

SaCaSun - Began delivering energy to the Visayas grid

Source: Official Gazette of the Republic of the Philippines

PROJECT UPDATES

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AGENDA

• Review of Business Units

• Power

• Banking & Financial Services

• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

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1,479

1,612

1Q2015 1Q2016

16

Net income grew on strong recurring income

Attributable to Parent Bank’s Stockholders

NET INCOME(in Php million)

FINANCIAL HIGHLIGHTS

9%

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4.37%5.09%

1.32% 1.25%

3.05%3.84%

YTD Mar2015

YTD Mar2016

Ave. Yield Ave. Cost NIM

2,528

3,539

1Q2015 1Q2016

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Net interest income surged due to loan expansion and improved margins

40%

NET INTEREST INCOME(in Php million)

79bps

FINANCIAL HIGHLIGHTS

YTD Mar 2015 YTD Mar 2016

NET INTEREST MARGIN EARNING ASSETS(ADB In Php million)

216 194

127 175

350 373

89.6% 89.4%

-1700.0%

-1500.0%

-1300.0%

-1100.0%

-900.0%

-700.0%

-500.0%

-300.0%

-100.0%

100.0%

100

150

200

250

300

350

400

450

YTD Mar 2015 YTD Mar 2016Liquid Assets Loans Others Share to Net Assets

7% +38%

-10%

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Credit portfolio posted strong expansion propelled by both corporate and retail loans

CREDIT PORTFOLIO(ADB in Php million)

FINANCIAL HIGHLIGHTS

67 78

2527

43

77135

182

YTD Mar 2015 YTD Mar 2016

Retail Commercial Corporate

35%

+12%

+16%

+64%

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Non-interest income weighed down by trading amidst robust fee business

NON-INTEREST INCOME(in Php million)

FINANCIAL HIGHLIGHTS

879 974

462

(32)

412

377

1,753

1,319

1Q2015 1Q2016

Ser. Charges, Fees and Com. Trading and FX Gain-net Miscellaneous

25%

+11%

-8%

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Operating expenses rose on branch expansion

OPERATING EXPENSES(in Php million)

FINANCIAL HIGHLIGHTS

1,972 2,260

218

241 2,292

2,569

1Q2015 1Q2016

Core Bank Taxes (GRT & DST) Subsidiaries

12%

+15%

+11%

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87 101

11

13 100

116

34.5% 37.1%

-1000.0%

-800.0%

-600.0%

-400.0%

-200.0%

0.0%

200.0%

60

70

80

90

100

110

120

130

140

YTD Mar 2015 YTD Mar 2016

Subsidiaries FCDU Peso Share of CASA to Total

246 269

44 44

289 313

-

50

100

150

200

250

300

350

YTD Mar 2015 YTD Mar 2016Subsidiaries UnionBank

TOTAL DEPOSITS(ADB in Php Billion)

21

CASA deposits sustained double-digit expansion

FINANCIAL HIGHLIGHTS

16% +16%

+18%

CASA DEPOSITS(ADB in Php Billion)

8%+9%

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Capital ratios remained healthy and above regulatory limits

FINANCIAL HIGHLIGHTS

13.6%

12.5%

17.1%

15.5%

1Q2015 1Q2016

Tier 1 Capital Ratio Total Capital Adequacy Ratio

CAPITAL ADEQUACY RATIOSConsolidated Basis

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Profitability ratios improved on strong quarter results

FINANCIAL HIGHLIGHTS

Return on Equity

Return on Average Assets

Cost to Income Ratio

10.6% 10.9%

1Q2015 1Q2016

1.5% 1.5%

1Q2015 1Q2016

54% 53%

1Q2015 1Q2016

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UnionBank shares trailing behind PSE and Financial indices

60%

70%

80%

90%

100%

110%

120%

UnionBank PSEi Financial Index

REBASED STOCK PERFORMANCE3/31/2015-3/31/2016

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AGENDA

• Review of Business Units

• Power

• Banking & Financial Services

• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

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2,080 1,551

2,207 2,702

891 773

451 473

1Q2015 1Q2016

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FINANCIAL HIGHLIGHTS

Feeds PhilippinesFlour FarmsFeeds Vietnam

5,498

2%

5,629

REVENUE(in Php million)

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FINANCIAL HIGHLIGHTS

2,080 1,551

1Q2015 1Q2016

Flour

25%

2,207 2,702

1Q2015 1Q2016

Feeds Philippines

22%

891 773

1Q2015 1Q2016

Feeds Vietnam

13%

451 473

1Q2015 1Q2016

Farms

5%

REVENUE(in Php million)

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FINANCIAL HIGHLIGHTS

EBITDA (in Php million)

306 304

238 335

58

22 124 91

1Q2015 1Q2016

Feeds PhilippinesFlour FarmsFeeds Vietnam

751

4%725

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FINANCIAL HIGHLIGHTS

306 304

1Q2015 1Q2016

Flour

1%

238 335

1Q2015 1Q2016

Feeds Philippines

41%

58

22

1Q2015 1Q2016

Feeds Vietnam

61%

124 91

1Q2015 1Q2016

Farms

EBITDA (in Php million)

27%

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FINANCIAL HIGHLIGHTS

NET INCOME(in Php million)

178 162

146 203

45 14

60 20

1Q2015 1Q2016

Feeds PhilippinesFlour FarmsFeeds Vietnam

3997%

429

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FINANCIAL HIGHLIGHTS

178 162

1Q2015 1Q2016

Flour

9%

146 203

1Q2015 1Q2016

Feeds Philippines

39%

45

14

1Q2015 1Q2016

Feeds Vietnam

69%

60

20

1Q2015 1Q2016

Farms

66%

NET INCOME(in Php million)

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58,485 59,365

2,105

1Q2015 1Q2016

Export Domestic

32

OPERATING HIGHLIGHTS – Flour Division

5%

Sales VolumeIn MT

Average Selling Prices and

Gross ProfitPeso/bag

Average Selling Price Gross Profit

61,470

889

631

149 124

1Q2015 1Q2016

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81,767 97,739

41,655 39,367

1Q2015 1Q2016

123,422 137,106

33

OPERATING HIGHLIGHTS – Feeds Division

11%

Sales VolumeIn MT

Average Selling Prices and

Income Over Ingredient Cost

Peso/MT

Average Selling Price

Income Over Ingredient Cost

Volume: Philippines Volume: Vietnam

Feeds Philippines

Average Selling Price

Income Over Ingredient Cost

Feeds Vietnam

23,847 23,843

5,347 5,516

1Q2015 1Q2016

21,380 19,649

2,904 2,259

1Q2015 1Q2016

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4,001 4,522

8,572

10,121

-

2,000

4,000

6,000

8,000

10,000

12,000

1Q2015 1Q2016

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

1Q2015 1Q2016Sales Volume ('000 Kilos) Ave Sow Level (heads)

34

OPERATING HIGHLIGHTS – Farms Division

Sales VolumeIn ‘000 kilos

Average Selling Prices and

Gross Profit

Peso/kilo

Average Selling Price Gross Profit

13%

109 97

27

14

-

5

10

15

20

25

301Q2015 1Q2016

-

20

40

60

80

100

120

1Q2015 1Q2016

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PROJECT UPDATES

Project

Updates

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PROJECT UPDATES - FEEDMILL

36

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PROJECT UPDATES - FARM

37

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PROJECT UPDATES - FARM

38

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AGENDA

• Review of Business Units

• Power

• Banking & Financial Services

• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

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Improvements anticipated from industrial lot sales and residential projects completion

FINANCIAL HIGHLIGHTS

40

300 282

253186

23

32

Q1 2015 Q1 2016

REVENUES(in Php million)

Residential Industrial Commercial and Others

13%576

500

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Residential sales exceeded targets driven by mid-market house & lots and high-end lot-only products

FINANCIAL HIGHLIGHTS

41

88 105

194

35354

130

1Q 2015 1Q 2016

RESIDENTIAL SALES(in Php million)

Condo H&L Lots

75%

336

588

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EBITDA and NIAT down by 37% and 38%, respectively

FINANCIAL HIGHLIGHTS

42

126

80

Q1 2015 Q1 2016

EBITDA(in Php million)

80

50

Q1 2015 Q1 2016

NIAT(in Php million)

37%

38%

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OPERATING HIGHLIGHTS

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Residential

Residential sales exceeded target

Launch of Amoa’s second enclave ahead of schedule

Commercial

Continued vigor shown by shoppers in The Outlets at Pueblo Verde, as evidenced by a 45% increase in foot traffic

45 brands in stores, 7 restaurants in The Fork in the Road

Has evolved into a unique shopping destination in Cebu

Industrial

Continued expansion activities

1.4 hectares sold out of 20-hectare target

10 hectares acquired out of 25-hectare target

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CDPEIEstate launch and commercial groundbreaking by June 2016

Garden District.

Esplanade

Anchor tenant

PROJECT UPDATES

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PROJECT UPDATES

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Final planning phases for

3 new projects in Luzon

2 new projects in Cebu

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Transfer of corporate HQto Taguig by mid-2017

PROJECT UPDATES

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PROJECT UPDATES

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2016 CAPEX targeted at 4.6B

29%

65%

6%

Q1 2016 CAPEX at 519M

28%

62%

10%

Land AcquisitionProject DevelopmentOther Initiatives

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AGENDA

• Review of Business Units

• Power

• Banking & Financial Services

• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

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● Strong Q1 cement demand supported by:○ Increased government spending in areas such as roads and

other public facilities○ Sustained rise in commercial and other non-residential

spaces ○ Continued growth in the residential sector

● Contribution to AEV amounts to P391 million

● Continued solid demand is expected for the remainder of 2016

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OPERATING HIGHLIGHTS

Strong cement demand experienced

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● The new finish mill boosts Norzagaray plant’s production capacity by 850,000 metric tons per annum

OPERATING HIGHLIGHTS

850,000 MT capacity added

● Supports sustainability initiatives through technology designed to have low wear rate and less energy consumption

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300 MLD Davao Bulk Water Project

One of the country’s largest private bulk water supply project

100% powered by renewable energy

Partnership with JV Angeles Construction Corporation

PROJECT UPDATES

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PROJECT UPDATES

AEV + SMRT Int’l Pte. Ltd =

Aboitiz-SMRT Transport Solutions Consortium

LRT 2 & Masinag Extension*Regional Bundled Airports

AEV + VINCI Airports =Maya Consortium

AEV Business Development – PPP Projects of Interest

*O&M

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AGENDA

• Review of Business Units

• Power

• Banking & Financial Services

• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

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FINANCIAL HIGHLIGHTS

1Q2015 1Q2016 % Ch

Revenues 27,029 27,736 3%

Equity Earnings 1,109 2,001 80%

EBITDA 9,408 11,166 19%

Net Income 4,086 5,049 24%

Core Net Income 4,077 4,863 19%

CONSOLIDATED PROFIT & LOSS(in Php million)

Maintained strong financial performance

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3,342 3,857

382

833

416

389 390

73

37

(127) (456)

1Q2015 1Q2016

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5,049EPS = P0.91

24%

4,086EPS = P0.74

Power Financial Services Food Parent & OthersReal Estate Infrastructure

FINANCIAL HIGHLIGHTS

NET INCOME(in Php million)

Power still accounted for bulk of earnings; fresh contribution from cement

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Power Financial Services Food Parent & OthersReal Estate Infrastructure

Non-Recurring Items1Q2015 1Q2016

Parent (0.3) (0.3)Power 9 186Total Gains/(Losses) 9 186

FINANCIAL HIGHLIGHTS

CORE NET INCOME (in Php million)

Netting out unrealized forex gains, core net income still increased

3,333 3,671

382

833 416

389

390

(127) (456)

73

37

4,863EPS = P0.88

4,077EPS = P0.74

19%

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9,408

7,908

11,166

10,176

EBITDA (Consolidated) EBITDA (Beneficial)

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1Q2015 1Q2016

19%

FINANCIAL HIGHLIGHTS

EBITDA(in Php million)

EBITDA increased on the back of new entrants and stronger results from Power and Banking

29%

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32,000 31,737

YE2015 1Q2016

7,056 7,272

YE2015 1Q2016

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Parent net debt decreased by P479mn

Cash & Equivalents

Long-term Debt

3%

1%

24,944 24,465

YE2015 1Q2016

FINANCIAL HIGHLIGHTS

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YE2015 1Q2016 % Change

Cash and Cash Equivalents 63,582 82,736 30%

Total Assets 340,118 370,596 9%

Total Liabilities 193,133 220,392 14%

Total Equity 146,984 150,188 2%

Equity Attributable to Parent 118,220 120,412 2%

Book Value Per Share 21.28 21.68

Current Ratio 2.84x 2.55x

Debt to Equity 1.31x 1.47x

Net Debt to Equity 0.66x 0.64x

FINANCIAL HIGHLIGHTS

CONSOLIDATED BALANCE SHEET/KEY RATIOS(in Php million, except ratios)

Gearing remained benign

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1Q2015 1Q2016 % Ch

AboitizPower 3,342 3,857 15%

UnionBank 382 837 119%

Petnet - (4)

Pilmico 416 389 -6%

AboitizLand 80 50 -38%

Republic Cement - 391

Parent & Others (134) (470) 250%

Net Income 4,086 5,049 24%

Core Net Income 4,077 4,863 19%

FINANCIAL HIGHLIGHTS

Fresh income contribution from new businesses

EARNINGS CONTRIBUTION(in Php million)

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AGENDA

• Review of Business Units

• Power

• Banking & Financial Services

• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

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Is there a better way?

62