Aboitiz Equity Ventures - Amazon S3 · Aboitiz Equity Ventures Third Quarter / YTD September 2016...

Aboitiz Equity Ventures

Third Quarter / YTD September 2016Financial & Operating Results

26 October 2016

2

AGENDA

• Review of Business Units

• Power

• Banking & Financial Services

• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

3

DistributionGeneration AP Parent & Others

Both generation and distribution segments grow net income

2,635 2,914

9,482

11,975

9M2015 9M2016

15,093EPS = P2.05

24%

+26%

+11%

12,194EPS = P1.66

851 932 1,132 906

4,189 3,9323,854

3,064

1Q2016 2Q2016 3Q2016 3Q2015

QUARTERLY BREAKDOWN

5,1354,9415,016 23%4%

4,164

FINANCIAL HIGHLIGHTS

NET INCOME (in Php million)

2,635 2,914

10,409 12,486

9M2015 9M2016

4


New coal capacity drives core net income higher

15,195EPS = P2.06

17%

+20%

+11%

12,999EPS = P1.77

Non-Recurring Items9M2015 9M2016 1Q2016 2Q2016 3Q2016 3Q2015

AP Parent 122 409 (15) 220 204 101

AP -Gen (927) (511) 257 (332) (436) (764)

Total Gains/(Losses) (805) (102) 242 (112) (232) (663)

851 932 1,132 906

3,9324,264

4,2903,828

1Q2016 2Q2016 3Q2016 3Q2015

QUARTERLY BREAKDOWN

4,8275,053

4,774

11%6%5,367


CORE NET INCOME (in Php million)

5

EBITDA growth driven by Therma South

4,114 4,497

20,759 24,582

9M2015 9M2016

29,259

+18%

+9%

25,196

16%


1,325 1,435 1,737 1,438

8,096 8,0078,480

7,391

1Q2016 2Q2016 3Q2016 3Q2015

QUARTERLY BREAKDOWN

9,0949,4439,526

13%9% 10,290


BENEFICIAL EBITDA (in Php million)

6

Balance sheet continues to be strong with low gearing

YE2015 9M2016 YE2015 9M2016

Cash and Equivalents 13,841 21,082 51,098 65,736

Investments and Advances 70,373 71,759 22,552 22,849

Total Assets 85,574 94,391 242,489 280,966

Total Interest Bearing Debt 9,911 9,919 114,612 147,672

Total Liabilities 22,613 22,616 140,876 176,900

Net Debt - - 63,514 81,936

Total Equity 62,962 71,775 101,614 104,066

Current Ratio 1.2x 1.8x 3.1x 3.1x

Net Debt to Equity -0.1x -0.2x 0.6x 0.8x

PARENT CONSOLIDATEDBALANCE SHEET

(in m illion pesos)


7

138 126

627 613

9491,136

151150

9M2015 9M2016

Capacity Sales Breakdown (MW)

Spot Market Energy Contracts

Capacity Contracts Ancillary

2,0261,866 9%

Capacity Sold Factor

Fuel Group 9M15 9M16Change in % points

MINI HYDRO 45% 40% -5

LARGE HYDRO 69% 67% -2

SNAP Magat 49% 49% -

SNAP Benguet 96% 94% -2

GEOTHERMAL 76% 77% +1

COAL 97% 91% -6

Therma Luzon 93% 90% -3

Therma South 89% -

OIL 97% 92% -5

SOLAR 21% -

AP GENERATION 85% 82% -3

Capacity sales growth mainly driven by Therma South

OPERATING HIGHLIGHTS: GENERATION

8

Fuel GroupBeneficial

Total Energy Sales(GWh)

BeneficialAncillary Sales

(GW-h)

9M15 9M16 YoY Chg 9M15 9M16 YoY Chg

MINI HYDRO 509 479 -6%

LARGE HYDRO 554 603 9% 779 733 -6%

SNAP Magat 240 297 24% 340 280 -18%

SNAP Benguet 314 306 -3% 439 453 3%

GEOTHERMAL 1,987 2,020 2%

COAL 4,701 5,826 24%

Therma Luzon 3,779 3,792 - 209 256 22%

Therma South 179 1,296 624%

OIL 1,413 1,367 -3%

SOLAR 13 -

AP GENERATION 9,164 10,308 12% 989 989 -

Volume growth driven by the Coal and Large Hydro Business Units


9

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

Water levels ends below the rule curve but recovered after recent typhoons

1Q 2Q 3Q 4Q


10

In Peso/kWhBilateral

ContractsSpot Market

Weighted Average

Ancillary

9M15 9M16 9M15 9M16 9M15 9M16 9M15 9M16

AP GENERATION GROUP 4.35 4.29 4.62 3.27 4.38 4.21 2.02 1.98

SNAP Magat 5.05 4.76 5.15 5.39 5.06 4.82 2.09 2.27

SNAP Benguet 4.69 4.62 6.95 4.04 4.86 4.51 2.15 1.92

Therma Luzon* 3.84 3.77 5.17 3.18 3.96 3.73 1.64 1.78

Therma South 2.76 5.09 - - 2.76 5.09

APRI** 4.28 4.11 3.88 2.65 4.19 3.82

Note: Fuel cost and purchased power:*TLI: P2.08/kWh (9M2016) versus P1.67/kWh (9M2015)**APRI: P1.54/kWh (9M2016) versus P1.60/kWh (9M2015)

Average selling price drops amid declining fuel cost


11

OPERATING HIGHLIGHTS: DISTRIBUTION

883

2,663

3,546

979

2,840

3,818

Residential Commercial &Industrial

Total Power Sales

9M2015 9M2016

BENEFICIAL POWER SALES (GWh)

BENEFICIAL GWH SALES GROWTH(BY CUSTOMER TYPE)

PEAK DEMAND (MW)

2,790 3,142 3,322 3,606 3,727 3,934 4,076 4,480 4,759 3,546 3,818

2007 2008 2009 2010 2011 2012 2013 2014 2015 9M2015 9M2016

8%

8%

11%

7%

Power sales grows across all customer segments

354 463

25 101 102

22 30 26

1,124

362

524

26 117 103

21 30 28

1,212

DavaoLight

VECO CotabatoLight

SFELAPCO SEZ MEZ BEZ LEZ Total

9M2015 9M2016

8%


2%

1% 1%

3%

5%

7%7% 7%

1% 1% 1%

3%

5%6%

7%8%

12

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 1.59

2011 2012 2013 2014 2015 9M2016

9M2016

9M2015

LEZ

Gross margin down brought by shift in supply mix


13

AboitizPower is the preferred bidder for GNPower Mariveles & Dinginin

GNPower Mariveles

GNPDU1 under constructionU2 expansion option

GMCPOperating

RECENT DEVELOPMENTS

14

Luzon

Bataan Manila

A strategic acquisition that would be immediately earnings accretive with short and mid-term capacity growth

Proposed acquisition cost: $1.197 billion

Description: Acquisition of The Blackstone Group’s indirectly held partnership interests in GMCP & GNPD.

Financing: Mix of internally generated cash and external debt (up to $650M)

Status: Subject to approval of Philippine Competition Commission and Board of Investments

GNPD668-MW U1 under construction668-MW U2 expansion option

GMCP604-MW Operating

TRANSACTION DETAILS

15

60% 70% 77%

0%20%40%60%80%

100%

2014 2015 YTD

Availability Factor

Currently being operated and maintained to world-class standards

Plant Name: GMCP

COD: January 2014

Gross Capacity: 651.6 MW

Net Capacity: 2 x 302 MW

Offtake:94% contracted(w/ good credit EC/DU)

Ownership: 66.1% (pending PCC approval)

2015 Net Debt: $516 mn*

2015 EBITDA: $136 mn*

*Derived from GMCP’s 2015 Audited FS

ASSET DETAILS - GNPower Mariveles Coal Plant Ltd. Co.

16

Period Covered Availability % EBITDA Commentary

Calendar 2014 60% $105Mn*• COD in Jan 2014. • Major re-works were implemented

Calendar 2015 70% $136Mn*

• Final warranty outage occurred during the first quarter - limited operations and hence very little revenue during this period.

• Various improvement works were implemented

Calendar 2016 ~77%**• Yearly planned outage occurred in 1Q2016

2017 Beyond• System upgrades and re-works have, and will

continue to, improve plant reliability and availability.

Availability has improved; program in place for further enhancement

*Derived from GMCP’s 2015 Audited FS**Jan to Sept YTD availability

AVAILABILITY - GNPower Mariveles Coal Plant Ltd. Co.

17

One of the first supercritical, high efficiency plants in the Philippines

Plant Name: GNPD

Capacity: 2 x 668 MW (supercritical)

Ownership 40% (pending PCC approval)

Project cost: > $1 billion for Unit 1

Unit 1

- Under construction- NTP & Financial close in

Sept. 2016- ~70% contracted- COD: 2019

Unit 2- Partially de-risked

expansion opportunity - Synergies with Unit 1

Plant Model

ASSET DETAILS - GNPower Dinginin Ltd. Co.

18

AGENDA


• Power


• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

NET INCOME(in Php million)

661

4,214

3Q2015 3Q2016

3,663

8,133

9M2015 9M2016

Attributable to Parent Bank’s Stockholders

PFRS 9

6.4x

2.2x


Net Income up by 122%

4.83% 5.04%

1.25% 1.26%

3.59% 3.78%

YTD Sept2015

YTD Sept2016

Ave. Yield Ave. Cost NIM

Net Interest Income sustains growth on improved margins and robust loan expansion

100 82

87 113

141 185

334 388 89.0% 89.5%

-100.0%

-80.0%

-60.0%

-40.0%

-20.0%

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

-

50

100

150

200

250

300

350

400

450

500

YTD Sept 2015 YTD Sept 2016

Liquid Assets Securities LoansOthers Share to Net Assets

-18%

16%+31%

+30%

19bps


-1,600

-

566 8,760 10,916

9M2015 9M2016

26% NIM Impact

74% Volume Impact


NET INTEREST INCOME(in Php million)

NET INTEREST MARGINEARNING ASSETS(ADB In Php billion)

79 109

87 113

9M2015 9M2016

HTC Others

69 80

2528

55

84149

191


Retail Commercial Corporate

Credit and Securities portfolio post robust expansion

29%

+10%

+52%

+16%

CREDIT PORTFOLIOADB in Php Billion

SECURITIES PORTFOLIOADB in Php Billion

30%


2,732 3,157

(26)

4,302

855

1,063

3,561

8,523

9M2015 9M2016

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

948 1,179

(671)

4,018

226

258

503

5,455

3Q2015 3Q2016

Non-interest income surges partly by strong fee income coupled with higher trust fund income

10.8x

9M2015 9M20163Q2015 3Q2016

2.4x

+14%

+24%

+24%

+16%


NON-INTEREST INCOME(in Php million)

239 286

40 46 279

331


UnionBank Subsidiaries

TOTAL DEPOSITSADB In Php Billion

Deposits growth underpinned by sustained CASA growth

CASA DEPOSITSADB In Php Billion

19%

91 106

12 14

104 122

37.4% 36.8%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

-

50

100

150

200


Peso FCDU Subsidiaries Share of CASA to Total

+20%

+15%

+17%17%

+16%


13.15%13.74%

16.41% 16.68%


Tier 1 Capital Ratio Total Capital Adequacy Ratio

Capital ratios remain healthy

CAPITAL ADEQUACY RATIOSConsolidated Basis


1.3%

2.5%

9M2015 9M2016

Profitability ratios further improve

8.8%

18.2%

9M2015 9M2016

55%46%

9M2015 9M2016


RETURN ON EQUITY

RETURN ON AVERAGE ASSETS

COST TO INCOME RATIO

80%

90%

100%

110%

120%

130%

140%

150%

Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16

UnionBank PSEi Financial Index

REBASED STOCK PERFORMANCE (9/30/2015-9/30/2016)

UnionBank outperforming PSE and Financial indices

27

AGENDA


• Power


• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

5,732 4,882

7,254 8,947

2,732 2,377

1,345 1,532

9M2015 9M2016

28


Feeds PhilippinesFlour FarmsFeeds Vietnam

17,73817,063

REVENUE(in Php million)

4%

1,551 1,673 1,657 1,869

2,702 3,074 3,171 2,577

773 806 799

847 473

524 535 385

1Q2016 2Q2016 3Q2016 3Q2015

9%

5,4986,077 6,162

1%

5,678

29


5,732 4,882

9M2015 9M2016

Flour

15%

7,254 8,947

9M2015 9M2016

Feeds Philippines

23%

2,732 2,377

9M2015 9M2016

Feeds Vietnam

13%

1,345 1,532

9M2015 9M2016

Farms

14%

REVENUE(in Php million)

906 910

930 1,117

158 101

387 371

9M 2015 9M 2016

30



2,4992,381

EBITDA(in Php million)

5%

304 331 276 294

335 384

398 407

22

42 36 31 91

122 158 117

1Q2016 2Q2016 3Q2016 3Q2015

2%

751

879 868 848

1%

31


906 910

9M2015 9M2016

Flour

930 1,117

9M2015 9M2016

Feeds Philippines

20%

158

101

9M2015 9M2016

Feeds Vietnam

36%

387 371

9M2015 9M2016

Farms


0,5%

4%

526 522

574 675

124 70

179 121

9M2015 9M2016

32



1,3871,402


162 204

156 169

203

233

239 253

14

31

25 24

20

39 61

48

1Q2016 2Q2016 3Q2016 3Q2015

399

507481

2%1%493

5%

33


526 522

9M2015 9M2016

Flour

321 436

1H2015 1H2016

Feeds Philippines

36%

124

70

9M2015 9M2016

Feeds Vietnam

44%

179 121

9M2015 9M2016

Farms


3%

33%

176,386 179,152

636 8,988

9M2015 9M2016

Export Domestic

34

OPERATING HIGHLIGHTS – Flour Division

6%

188,140

Sales Volume (in Tons)

Average Selling Prices and Gross Profit (Php/Bag)

177,022

810 649

133 122

9M 2015 9M 2016

Average Selling Price Gross Profit Per Bag

278,051 320,015

132,585 121,140

9M 2015 9M 2016

Volume: Philippines Volume: Vietnam

410,636 441,155

35

OPERATING HIGHLIGHTS – Feeds Division

7%

Fee

ds

Ph

ilip

pin

es

Feed

s V

ietn

am

Sales Volume (in Tons)

Average Selling Prices andIncome Over Ingredient Cost (Php/Mt)

24,015 25,214

6,812 6,844

9M 2015 9M 2016

Price/MT IOIC/MT

20,551 19,622

2,609 2,400

9M 2015 9M 2016

Price/MT IOIC/MT

36

OPERATING HIGHLIGHTS – Farms Division

Sales Volume (in ‘000 Kilos)and Ave Sow Level

Average Selling Prices andGross Profit (Php/Kg)

11,398 13,686

9,500

12,400

9M 2015 9M 2016Sales Volume ('000 Kilos) Ave Sow Level (heads)

20%

114 105

31 21

9M 2015 9M 2016

Average Selling Price Gross Profit Per Kilo

37

PROJECT UPDATES

Project

Updates

100%

BREEDER

FARM 2

AUG 2016

99%

NURSERY

FARM 2

OCT 2016

Farm UpdatesPROJECT UPDATES – FARM

Farm Updates

100%

GROWFIN

FARM 9

SEP 2016

42%

GROWFIN

FARM 10

DEC 2016

84%

LAYER

FARM 4/4

OCT 2016

PROJECT UPDATES – FARM

Project Pipeline

Investment in New Meat Processing plant to support growth in farms business

6,200

8,360

14,600

sowlevel

2012 2014 2017

270,000Market Hogs

per year

MEATSLIVE HOGSFARMS MEAT PROCESSING

PLANT

Triple A slaughter & meat

fabrication facility

Php 700M investment

180 heads per hour capacity

Operational July 2018

PROJECT PIPELINE

Have a ready answer for hunger and

malnutrition with The Care

Package: High Energy Biscuits

42

AGENDA


• Power


• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

8251,017

759 534

90 107

1,674 1,658

3Q 2015 3Q 2016

REVENUES(in Php million)

Residential Industrial Commercial and Others

Revenues flat; lower industrial sales offset by growth in residential and commercial


43

1%+23%

-30%

+19%

9M2015 9M2016

526

988240

264

273

258

1,039

1,510

3Q 2015 3Q 2016

RESIDENTIAL SALES(in Php million)

H&L Condo Lots

Residential sales grow by 45% driven by house & lot products in the mid-market and lot products in the high-end market


44

45%

9M2015 9M2016

EBITDA and NIAT drop by 32% and 44%, respectively driven by organization expansion and systems enhancement


45

32%

44%

355

243

3Q 2015 3Q 2016


267

149

3Q 2015 3Q 2016

NIAT(in Php million)

BUSINESS HIGHLIGHTS

• Construction in full swing and set to open in 2H 2017• Interest from prospects and the general public constantly

increasing

BUSINESS HIGHLIGHTS

Residential

Sales performing consistently well, continuing to beat year-on-year targets by a significant margin

Projects continue to show progress in development and construction

Some project launches have been moved to the first half of next year

Commercial

The Outlets at Pueblo Verde Expansion nearing full occupancy within its first year of operations

Industrial

20 hectares sold

15 hectares acquired for future expansion

Gatewalk

Visible construction and development

BUSINESS HIGHLIGHTS

Final planning phases for

3 new projects in Luzon

2 new projects in Cebu

PROJECT PIPELINE

80%

12%

8%

3Q 2016 CAPEX at P1.6B

65%

29%

6%

2016 CAPEX targeted at P4.6B

With the move of a few residential project launches, unspent 2016 CAPEX

shall be deferred to 2017

CAPEX

51

AGENDA


• Power


• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

Sustained cement demand in 9M16 supported by: Growth in commercial

and other non-residential sectors

Steady demand in the residential sector

Public infrastructure spending

Contribution to AEV in 9M16 amounts to PHP1.3bn

52

OPERATING HIGHLIGHTS

Continued strong construction demand

53

300 MLD Davao Bulk Water Project

One of the country’s largest private bulk water supply projects30-year operations

Project status: permitting, preparation of design phase

100% powered by renewable energy

Partnership with JV Angeles Construction Corporation

PROJECT UPDATES

TamuganWeir

HEP and WTP Calinan

Reservoir

TalandangReservoir

MandugReservoir

IndanganReservoir

PanacanReservoir

CabantianReservoir

Panorama Reservoir

GUMALANG

MATINA APLAYA

MALAGOS

RIVERSIDE

TACUNAN

TALANDANG

LASANG

BUNAWAN

ACACIATIBUNGCO

LUBOGAN

MINTAL

CALINAN

POBLACIONCATALUNAN GRANDE

BAGO GALLERA

BIAO ESCUELA

MATINA BIAO

NEW VALENCIA

LOS AMIGOS

TAMUGANCALLAWA

SASA

CABANTIAN

NEW LOON

PAMPANGA

TUGBOK

MANDUG

TIGATTO

TAWAN-TAWAN

LACSON

MATINA

TugbokReservoir

54

Regional Bundled AirportsAEV + VINCI Airports = Maya Consortium

Davao (DVO)

Bohol (TAG)

Bacolod (BCD)

Iloilo (ILO)

Laguindingan (CGY)

LRT 2 AEV + SMRT Int’l Pte. Ltd = Aboitiz-SMRT Transport Solutions Consortium

PPP PROJECTS OF INTEREST

55

AGENDA


• Power


• Food

• Land

• Infrastructure

• AEV Financials

• Q&A

56


3Q2015 3Q2016 % Ch 9M2015 9M2016 % Ch

Revenues 28,742 30,589 6% 83,314 87,545 4%

Equity Earnings 1,834 3,174 73% 4,077 7,336 80%

EBITDA 10,402 13,412 29% 28,604 36,208 27%

Net Income 4,078 6,582 61% 11,899 17,087 44%

Core Net Income 4,591 6,699 46% 12,522 17,103 37%

CONSOLIDATED PROFIT & LOSS(in Php million)

First nine months exhibit stronger financial performance

9,375 11,604

1,438

3,954

1,373

1,354

1,276

249

149

(559) (1,250)

17,087EPS = P3.05

44%11,899EPS = P2.14

9M2015 9M2016

57

Power Financial Services Food Parent & OthersReal Estate Infrastructure



Power contribution down to 63% YTD

3,857 3,799 3,948 3,201

833 1,078

2,043

572

389 496

469

488

390 477

408

50 35

64

36

(469) (430) (351) (242)

6,58221%

5,0495,456

61%

1Q2016 2Q2016 3Q2016 3Q2015

4,078

9,994 11,682

1,438

3,954

1,373

1,354 1,276

249

149

(555) (1,311)

17,103EPS = P3.06

37%12,522EPS = P2.26

9M2015 9M2016

58

Power Financial Services Food Parent & OthersReal Estate Infrastructure


CORE NET INCOME (in Php million)

Non-Recurring Items9M2015 9M2016

Parent (4.1) 61.7

Power (619.0) (78.4)

Total Gains/(Losses) (623.2) (16.7)

Non-Recurring Items1Q2016 2Q2016 3Q2016 3Q2015

Parent (0.3) 0.3 61.7 (4.0)

Power 186.1 (85.8) (178.6) (509.4)

Total Gains/(Losses) 185.8 (85.5) (116.9) (513.4)

3,671 3,885 4,127 3,711

833 1,078

2,043

572

389

496

469

488

390

477

408

50

35

64

36

(469) (430) (413) (238)

6,69921%

4,8635,541

46%

1Q2016 2Q2016 3Q2016 3Q2015

4,591

28,604

24,378

36,208

32,628

EBITDA (Consolidated) EBITDA (Beneficial)

59

9M2015 9M2016

27%



EBITDA increases on fresh contribution from RCBM and TSI, and stronger results from distribution and banking

34%

32,000 31,760

YE2015 9M2016

7,056

13,821

2,695

YE2015 9M2016Advances to Related Parties Cash & Equivalents

60

Parent net debt decreases by P9.7 bn

Cash & Equivalents

Long-term Debt

134%

1%

24,944

15,244

YE2015 9M2016


16,516

61

YE2015 9M2016 % Change

Cash and Cash Equivalents 63,582 84,461 33%

Total Assets 340,118 393,728 16%

Total Liabilities 193,133 224,251 16%

Total Equity 146,984 169,476 15%

Equity Attributable to Parent 118,220 140,349 19%

Book Value Per Share 21.28 24.91

Current Ratio 2.84x 3.23x

Debt to Equity 1.31x 1.32x

Net Debt to Equity 0.66x 0.63x


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

Healthy ratios maintained

62

3Q2015 3Q2016 % Ch 9M2015 9M2016 % Ch

AboitizPower 3,201 3,948 23% 9,375 11,604 24%

UnionBank 557 2,030 264% 1,424 3,963 178%

Petnet 15 13 -8% 15 (10) -165%

Pilmico 488 469 -4% 1,373 1,354 -1%

AboitizLand 36 64 79% 249 149 -40%

Republic Cement 22 409 1729% 22 1,278 5616%

Parent & Others (242) (352) 45% (559) (1,252) 124%

Net Income 4,078 6,582 61% 11,899 17,087 44%

Core Net Income 4,591 6,699 46% 12,522 17,103 37%

Fresh income contribution from new businesses

EARNINGS CONTRIBUTION(in Php million)

ANNEX

63

AGENDA


• AboitizPower

• UnionBank

• Pilmico

• AboitizLand

• Republic Cement and Building Materials

• AEV Financials

• Q&A

Is there a better way?

64

Aboitiz Equity Ventures - Amazon S3 · Aboitiz Equity Ventures Third Quarter / YTD September 2016...

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Transcript of Aboitiz Equity Ventures - Amazon S3 · Aboitiz Equity Ventures Third Quarter / YTD September 2016...