Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd...

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Hyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance & CIO 4 November 2010

Transcript of Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd...

Page 1: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Hyflux Ltd3Q10 Results Review

Sam OngGroup Deputy CEO & CFO

Cho Wee PengGroup EVP, Finance & CIO

4 November 2010

Page 2: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Agenda

• 3Q10 Financial Results Review

• Key Updates

• Business Outlook & Strategy

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Page 3: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

3Q10 Financial Results Review3Q10 Financial Results Review

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Page 4: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

S$ mln 3Q10 3Q09 % Change 9M10 9M09 % Change

Revenue 137.5 126.5 9 379.2 349.2 9

PBT 20.7 19.3 7 58.9 54.7 8

PATMI 19.0 18.1 5 52.7 49.1 7

Stable Profits

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Key highlights

• Group revenue and profit remained steady.

• The effective tax rate for 3Q10 was lower mainly due to tax exemptions and incentives enjoyed by certain entities in the Group.

Page 5: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Revenue Breakdown

Revenue by Country Revenue by Sector

200

250

300

350

400

269.9 (71%)

23.0 (6%)

222.8 (64%)

12.1 (3%)

MENA

SG/OTH

200

250

300

350

400

51.1 (13%)

2.3 (1%)

42.8 (12%)INDUSTRIAL

OTHERS

S$ mil S$ mil

1.4 (1%)

5

0

50

100

150

200

9M10 9M09

CHINA 86.3 (23%) 114.3 (33%)

Key highlights Key highlights

0

50

100

150

200

9M10 9M09

MUNICIPAL325.8 (86%) 305.0 (87%)

• MENA continues to be the major contributor with the progressive EPC recognition of Magtaa.

• Increase in contributions from Singapore is due to progress in the Tembusu desalination and Jurong MBR projects.

• Municipal sales remains the key driver with the execution of MENA projects.

• Industrial sales improved as projects previously put on hold by clients were resumed.

Page 6: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Overall Expenses remain StableS$ mln 3Q10 3Q09 % Change 9M10 9M09 % Change

Raw Materials & Consumables 74.2 81.7 (9) 210.7 214.1 (2)

Staff Costs 15.6 12.6 24 41.3 39.9 3

Depreciation & Amortisation 4.9 3.0 64 11.6 7.9 48

Other Expenses 21.7 11.4 90 51.4 36.1 42

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Finance Costs 4.6 1.7 171 12.6 6.6 90

Total Operating & Fin Expenses

121.0 110.4 10 327.6 304.6 8

Key highlights

• Decrease in raw materials and consumables used and subcontractors’ costs was due to cost management measures.

• Increase in staff costs was in line with Group’s expansion plan.

• Depreciation and amortisation rose in line with property, plant and equipment.

• Finance costs increased because of higher bank borrowings to support the Group’s activities.

• Other expenses increased due to higher project-related professional fees and foreign exchange loss resulting from the weakening of the US dollar.

Page 7: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Balance Sheet remains HealthyS$ mln 30 Sep 10 30 June 10 31 Dec 09

Equity 498 498 393

LT Assets 524 558 523

LT Liabilities 418 401 361

Current Liabilities 360 335 318

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Net Current Assets 392 341 231

Net Gearing 0.52x 0.49x 0.59x

Key highlights

• Rise in Shareholders’ Equity was largely attributable to changes in share capital arising from shares issued under the Warrant Subscription Agreement with Istithmar. Ordinary shares in issue rose to 570,659,410 at 30 Sep 2010 from 528,365,360 at 1 Jan 2010.

• Long-term Liabilities rose mainly due to increased bank borrowings to support the Group’s expansion and investment activities.

• Net gearing remains steady at 0.52x.

Page 8: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Improving Cash Flow

S$ mln 3Q10 3Q09 9M10 9M09

CF Operations 9 (30) (33) (5)

CF Investing (6) (26) (38) (64)

CF Financing 134 66 224 109

Net Cash Changes 137 10 153 40

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Cash & Equivalents 308 130 308 130

Key highlights

• YTD cash position has improved over the corresponding period with progressive payments received from projects and proceeds from the issuance of new shares under the Warrant Subscription Agreement.

• Cash generated from financing activities was mainly borrowing proceeds to fund the Group’s expansion and investments.

Page 9: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Stable Overall Margins

S$ mln 3Q10 3Q09 9M10 9M09

Gross Margin 48% 36% 45% 40%

Net Margin 14% 14% 14% 14%

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Key highlights

• Net margins held steady.

Page 10: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Key UpdatesKey Updates

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Page 11: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Key Updates

• Proposed bonus share issue– One bonus share for every two existing ordinary shares

– Bonus issue is subject to approval of SGX

• HWT delisting• HWT delisting– Exit offer becomes unconditional

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Page 12: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

HWT Delisting – Key Events

Event Date Outcome

HWT EGM 20 October 2010 99.54% (146,939,602 units) voted in favour of the delisting resolution

Exit Offer Turns Unconditional 29 October 2010 75.97% accepted the exit offer

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Exit Offer Turns Unconditional 29 October 2010 75.97% accepted the exit offer

Revised Closing Date for Exit Offer 12 November 2010(or such later date as may

be announced)

HWT shares will be suspended from trading on the next trading day of the SGX-ST

• Galaxy NewSpring will acquire all assets in HWT’s portfolio and integrate them with four other assets (Jiangxi Leping WTP, Anhui Mingguang WTP, Hunan Taoyuan WTP, Liaoyang Gongchangling WTP).

Page 13: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Business Outlook & StrategyBusiness Outlook & Strategy

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Page 14: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Business Outlook

• Pace of economic recovery remains uneven across the globe

• Continued fluctuations of the USD and RMB will have an impact on the group’s financial performance as its an impact on the group’s financial performance as its revenues are dominated in the 2 currencies

• Outlook for global water industry continues to be robust; water infrastructure projects expected to accelerate as economic development exacerbates water shortages

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Page 15: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Building Blocks for Growth

Capturing growth opportunities with robust financial platform

Focusing on key growth markets: North Africa, China,

Middle East, India, Southeast Asia

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Middle East, India, Southeast Asia

Investing in Technology Development

Strengthening Human Capital

Page 16: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

WATER SOLUTIONS THAT

IMPACT LIVES

Page 17: Hyflux Ltd 3Q10 Results Reviewinvestors.hyflux.com/newsroom/Hyflux_3Q2010AnalystSlides.pdfHyflux Ltd 3Q10 Results Review Sam Ong Group Deputy CEO & CFO Cho Wee Peng Group EVP, Finance

Disclaimer

This presentation has been prepared by Hyflux Ltd for the information of the attendees of this presentation.

This presentation is not and does not constitute or form part of any offer, invitation or recommendation to subscribefor or purchase any security and neither this presentation nor anything contained in it shall form the basis of, or befor or purchase any security and neither this presentation nor anything contained in it shall form the basis of, or berelied upon in connection with, any contract, commitment or investment decision. This document may not be used orrelied upon by any party, or for any other purpose, and may not be reproduced, disseminated or quoted without theprior written consent of Hyflux Ltd.

No representation or warranty express or implied is made as to, and no reliance should be placed on, the fairness,accuracy, completeness or correctness of the information or opinions contained herein. None of Hyflux Ltd or any ofits affiliates, advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any losshowsoever arising from any use of this document or its contents or otherwise arising in connection with thispresentation.

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