DMCI Holdings, Inc. HI IR...Tarlac-Pangasinan-La Union-Expressway 15B Php* * 15B Php out of 20B Php...

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DMCI Holdings, Inc.

3/F, DACON Building

2281 Pasong Tamo Ext.

Makati 1231

Philippines

Dr. Victor Limlingan, Managing Director

September 2014

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Disclaimer

• The information contained in this document is strictly

confidential. Neither DMCI Holdings, Inc. (DMCI), nor its

advisors make any representation regarding, and assumes no

responsibility or liability for, the accuracy or completeness of, or

any errors or omissions in any information contained herein.

Such information is subject to change without notice, its

accuracy is not guaranteed and it may not contain all material

information concerning DMCI.

• In addition, this document contains certain financial information

and results of operation, and may also contain certain

projections, plans, strategies, and objectives of DMCI, that are

not statements of historical fact which would be treated as

forward looking statements within the meaning of applicable

law. Forward looking statements are subject to risks and

uncertainties that may cause actual events and DMCI’s future

results to be materially different than expected or indicated by

such statements. No assurance can be given that the results

anticipated by DMCI, or indicated by any such forward looking

statements, will be achieved.

• This document is not an offer of securities for sale in the United

States. Securities may not be offered or sold in the United

States absent registration under the United States Securities

Act of 1933, as amended (the “Securities Act”) or an exemption

from such registration. This document is not an offer to sell

securities or a solicitation of an offer to buy securities in any

jurisdiction where such offer or sale is not permitted.

3 The DMCI Group: Engineering Expertise

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Contents

• History of DMCI

• The DMCI Group: Financials

• Portfolio Management

• Target Portfolio (5-year plan)

• Investors

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• Founded in 1954, it is

acknowledged as one of the

leaders in the Philippine

construction industry

• Built more than 500 buildings &

structures (including national

landmarks)

• One of the first to use precast,

pre-stressed & high-strength

ready-mixed concrete

History of DMCI

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David M. Consunji Founder

• “…building is not just an

occupation or even just a

profession, but a calling.

• Constructing honestly and well

is a task that combines huge

social value, enormous

technical challenges, and a

great ethical obligation to be fair

to clients and employees.”

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Contents

• History of DMCI




• Investors

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The DMCI Group: Subsidiaries

Listed subsidiaries NAV (Pm)* *August 2014, DB

Stakes

Semirara 80,029 56%

Unlisted subsidiaries

Maynilad Water 22,663 25%

DMCI Homes 35,013 100%

Construction 63,270 100%

DMCI Power 2,831 100%

DMCI Mining (ex - TMC)

24,495 100%

TPLEX 14,629 24%

Total 242,930

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The DMCI Group: Net Income & NAV

Subsidiaries Net Income Php

After Minority Interest, For the period ended

June 30, 2014 (In Mn Php)

NAV (Pm) August 2014, DB

% 1H 2014*

Semirara &

Sem-Calaca 1,504 80,029 4%

(3% & 1%, respectively)

Maynilad Water (DMCI - MPIC)

977 22,663 9%

DMCI Homes (PDI)

1,653 35,013 9%

Construction (DMCI)

591 63,270 2%

DMCI Power (incl. TMC)

125 2,831 9%

DMCI Mining 205 24,495 2%

Total 5,055 (excluding parent income)

228,301 4.43%

*Annualized

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The DMCI Group: Book Value vs Market Price

Listed subsidiaries NAV* August 2014, DB

Book value (PhPMn)* 1H 2014

NAV/BK**

Semirara 80,029 18,500 4.33

Unlisted

subsidiaries

Maynilad Water 22,663 5,665 4.00

DMCI Homes 35,013 11,232 3.12

Construction 63,270 6,157 10.28

DMCI Power 2,831 1,624 1.74

DMCI Mining (ex - TMC)

24,495 2,998 8.17

ENK Plc Not available - -

Text

* All figures are taken from the 1H 2014 interim financial statements and NAV figures date to approximately August 2014, DB

** NAV based on Financial Statements (Annualized)

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The DMCI Group: Net Income & Book Value

Subsidiaries Net Income (Php Mn) After Minority Interest, For the period ended

June 30, 2014 (In Mn Php)

Book value (PhPMn) 1H 2014

% 1H 2014

Semirara & Sem-

Calaca 1,504 18,500 8%

(2% & 6%, respectively)

Maynilad Water (DMCI - MPIC)

977 5,665 17%

DMCI Homes (PDI)

1,653 11,232 15%

Construction (DMCI)

591 6,157 10%

DMCI Power (incl. TMC)

125 1,624 8%

DMCI Mining 205 2,998 7%

Total 5,055 (excluding parent income)

64,240 8%

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Contents

• History of DMCI




• Investors

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DMCI Holdings, Inc.: Portfolio

• Grow

• Develop

• Hold

A. Power (Sem-Calaca)

B. Construction

A. Coal (Semirara Mining)

B. Real Estate (DMCI Homes)

C. Maynilad Water

A. DMCI Mining (metal-mining)

B. DMCI Power (SPUG)

C. Infrastructure (as a proponent)

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Power

Sem-Calaca: 1,000 MW

expansion in addition to existing

600 MW capacity. Phase 1:

ongoing construction of 2x150

MW plants (CFB). Phase 2:

planned construction of 2x350

MW plant (pulverized coal)

PROJECT UPDATE (Phase 1)

AREAS/ACTIVITY STATUS AS OF JUNE 30, 2014

1. EQUIPMENT

MANUFACTURING

2. SHIPPING DELAYS

Engineering Progress – 100% (Completed)

Procurement/Shipment – 95.4% (Completion in

Aug.)

3. CONSTRUCTION / CIVIL

WORKS

Construction Progress – 66.1%

4. COMMERCIAL Consultant Engaged (Provisional certificate for NGCP TSA, CA & MSA available; ERC COC in

process; WESM/PEMC registration in process)

PROJECT STATUS BY MAJOR AREAS

PROJECT UPDATE (Phase 2)

1 x 350 MW CFB Power Plant

AREAS STATUS AS OF JUNE 30, 2014

1. BOI REGISTRATION

Approved by BOI with certain conditions to

comply for final registration

2. ECC Conversion from “CFB” to “PC” technology in process

3. EPC EP supplier’s proposal under final stage of review and evaluation

4. PROJECT FINANCING Awaiting final award of EPC contractor

PROJECT UPDATE (1X 350MW)

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Power (Sem-Calaca)

BEFORE 2009

Generation (GWh) 181

Revenue (Php Mn) 444

Net Income (PhP Mn) 59

Purchase Price (Php Mn)

100% owned by SCC 16, 290

AFTER 2012 2013 1H 2014

Generation (GWh) 2, 463 3,638 1,321

Revenue (Php Mn) 9, 700 14,760 4,928

Net Income (PhP Mn) 3, 280 5,780 (573)

NAV (Php Mn)* 64,600 64,600 80,029

* Based on CLSA estimated NAV (as of April 2014)

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Awards ~ TPLEX, NAIA

Expressway & MRT 7;

Prospects ~ Metro Manila

Skyway, LRT 1 Ext. & CALA

Expressway; NLEX-SLEX

Connector Rd., LRT Line 2 East

Ext., & C-6 Skyway (Stage 4)

Construction

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Award 1: TPLEX Tarlac-Pangasinan-La Union-Expressway 15B Php*

* 15B Php out of 20B Php total for the entire project

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Awards 2: MRT - 7 20B Php

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Award 3: NAIA Expressway 10B Php

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Award 4: NAIA Terminal 1 Rehab 1.3B Php

Construction Period: January 2014 – January 2015

Project inclusions: Architectural works, improvement of

mechanical, electrical and plumbing, and structural retrofitting

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Award 5: NAIA Expressway At-Grade Works

849M Php

Construction of the Embankment and Utilities for the At-Grade Portion of

NAIA-X Project

Proponent: Entertainment City Estate Management Inc. (ECEMI)

At-Grade

Entertainment City

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Award 6: Connector

Road (CITRA)* 25B Php

• Blue Segment = MPIC

• Red Segment = CITRA

• 5 km _Common Segment_

*No Photo Available:

Award 2: Embankment 3B PhP & Award 3: Terminal 1 2B Php

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Prospects 1: LRT - 1 Extension

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Prospects 2: Connector Road (MPIC) (ABOVE LEFT: blue segment)

Prospects 3: CALA Expressway (ABOVE RIGHT)

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Prospects 4: C - 6

(CITRA) 50B Php estimated

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• Grow

• Develop

• Hold


B. Construction






C. Maynilad Water

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DMCI Mining

Improvement of operating

capacity of nickel assets (ENK &

TMC) underway. Long term

option is to use Direct Shipping

Ore to create capital to undertake

nickel processing of lateritic nickel

ore (

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Nickel Assets: ENK & Toledo

ENK TOLEDO

Interest 100% 98.09%

Location Acoje, Zambales Berong, Long Point & Moorsom,

Ipilan, Ulugan

Minerals

Acoje – 50.14 MT

@1.08% nickel

Zambales - 23.5 MT

@ 1.18% nickel

Berong – 8.84 MT @ 1.55% nickel

Long point & Moorsom – 120 MT

@ 1.27 nickel

Ipilan – 43.37 MT @ 1.20 nickel

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DMCI Power

(SPUG)

Investing in off-grid areas &

delivering power at a competitive

price. Construction & operation of

coal-fired plants in order to

reduce cost or production to ~

Php 5.00/kWh. DMCI Power to

use 100% Semirara coal.

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SPUG Power Plants 1:

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15MW Bunker Power Plant

Oriental, Mindoro

Location : Calapan, Oriental Mindoro

Off-taker : Mindoro Electric Cooperative (ORMECO)

Supply Cont : 20 yrs. Power Supply Agreement with

Minimum Energy Off-take of 50.6GWh p.a.

Est. Proj. Cost : PhP 900M

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Infrastructure

• Proponent vs. Contractor

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• Grow

• Develop

• Hold


B. Construction



C. Maynilad Water




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Coal Maintain production: 7.7 MTs/yr

file://localhost/Users/ir-pc/Downloads/Slide 16.JPG

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Semirara (Coal Mining)

BEFORE 1996

Production (‘000 MT) 806

Revenue (Php Mn) 654

Net Income (PhP Mn) (2, 335)

FOB Price (Php Mn) 997


66% equity 672

AFTER 2012 2013 1H 2014

Production (‘000 MT) 7,657 7,861 5,129

Revenue (Php Mn) 14,450 12,573 10,199

Net Income (PhP Mn) Total Consoliated

3,088 1,800 3,222

FOB Price (Php Mn) 2,454 2,185 2,301

Market Value* (Php Mn)

56% equity 47, 082 53,346 74,413

*Based on Semirara’s Market Price as of August 2014

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Semirara Island: Mines & Deposits

SILICA

LIMESTONE

BOBOG MINE

CLAY

PANIAN -COAL

HIMALIAN-COAL

UNONG-COAL

12 MILLION MT

DEPLETED

UNONG-COAL

12 MILLION MT

DEPLETED

LIMESTONE 1.0 BILLION TONS

Earlier Studies

AustroMineral Contractors, 1980 to 1985

Dames & Moore, 1982

Geomontan, 1990

Monenco Consultants Limited, 1990 Minarco Asia

Pacific Pty, Limited, 2004 Queensland Geological

Services Pty Ltd, 2006

Exploration by DMCI:

560 exploration and confirmatory holes, 2006 to

2011

* Coal resources & recoverable reserves estimates

certified by local competent persons

** Coal resources estimate certified by local

competent person, pending certification of

recoverable reserves estimate

*** Coal resources & recoverable reserves

estimates pending certification by local competent

persons

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Real Estate

Our “Hold” approach in Real

Estate translates into modest

growth. Target 10% year-on-year

growth in sales from 2013 to

2014. Projected increase in 2014

net income is also 10%.

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Maynilad Water

After the partial sale of its stake in

Maynilad Water, DMCI Holdings

maintains or “holds” at 25%

ownership.

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Water

BEFORE 2007

Billed Volume (mcm) 286

Revenue (Php Mn) 100%

7, 377

Net Income (PhP Mn) 100%

1, 666

NRW (%) 66.00


42% equity 3, 000

AFTER 2012 2013 1H 2014

Billed Volume (mcm) 428 444 230

Revenue (Php Mn) 100%

15,834 16,777 8,939

Net Income (PhP Mn) 100%

6,386 6,846 3,922

NRW (%) 43.47 38.71 34.37

Market Value (Php Mn)

34, 294 42% equity

21,192* 25% equity

22,663* 25% equity

* 25% Equity as of February 2013 after sale of 16% Interest to Marubeni for total amount of Php 13 billion

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Arbitration: Maynilad’s stance

• Maynilad is a concessionaire of the Metropolitan Waterworks and Sewerage System (MWSS) given the exclusive right to manage water and wastewater operations in the West Zone of the Greater Manila Area as defined in the Concession Agreement (CA) entered into by both parties on 21 February 1997. Under the CA, a Rate Rebasing process is conducted every five years to determine the adjustment to be made to the tariff charged by Maynilad for the services it renders that will allow it to recover and earn a return on its expenditures. On 30 March 2012, Maynilad submitted a business plan for the determination of the adjustment to be applied to its standard rates for the period 2013 to 2017. On 12 September 2013, MWSS denied Maynilad’s petition for an upward adjustment of 28.35% of its average basic charge (or Php8.58 per cubic meter), and instead approved a negative adjustment of 4.82% (or Php1.46 per cubic meter), which Maynilad subsequently contested. On 4 October 2013, Maynilad filed a notice of dispute with the Secretariat of the International Chamber of Commerce (ICC) International Court of Arbitration to resolve its rebasing dispute with MWSS. Maynilad reviewed and took into consideration the MWSS determination as outlined in its September resolution and submitted an alternative proposal with a positive adjustment of 13.41% (or Php4.06 per cubic meter). The most significant element driving this alternative proposal is Maynilad’s position that corporate income tax should be a recoverable expenditure in tariff determination.

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Contents

• History of DMCI




• Investors

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DMCI Holdings, Inc. - Target Portfolio (2019)

Portfolio 2014 2019

Grow Power 25% 30%

Construction 25% 10%

Develop DMCI Mining 0% 10%

DMCI Power 0% 10%

Infrastructure 0% 10%

Hold Coal 15% 10%

Real Estate 20% 10%

Maynilad 15% 10%

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2014 Portfolio ~

Power

Construction

Coal

Real Estate

Maynilad

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2019 Target Portfolio ~

Power

Construction

DMCI Mining DMCI Power

Infrastructure

Coal

Real Estate

Maynilad

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Contents

• History of DMCI




• Investors

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Pledge to Investors

• DMCI will seek a fair, not an over valuation of its shares

• DMCI will focus on the long-term, not the short-term

• DMCI will respect the rights of its Minority Stockholders

DMCI Holdings, Inc. HI IR...Tarlac-Pangasinan-La Union-Expressway 15B Php* * 15B Php out of 20B Php...

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