4q18 & fy18 results briefing - banyan tree...
TRANSCRIPT
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4Q18 & FY18 Results Briefing
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Disclaimer
This document is provided to you for information only and should not be relied on or used as a basis for making any specificinvestment, business or commercial decision. No representation or warranty, expressed or implied, is made as to, and noreliance should be placed on, the information or opinions contained herein. This document does not constitute and should notbe construed as, any offer or solicitation for the subscription, purchase or sale of any securities of Banyan Tree HoldingsLimited (“Banyan Tree”). Nothing in this document should be construed as a recommendation regarding the securities ofBanyan Tree.
Certain statements in this document may constitute "forward-looking statements”, including statements regarding, amongstother things, Banyan Tree’s business and growth strategy. These statements reflect Banyan Tree’s expectations and aresubject to risks and uncertainties that may cause actual results to differ materially and may adversely affect the outcome andfinancial effects of the plans described herein. You are cautioned not to rely on such forward-looking statements. BanyanTree disclaims any obligation to update their view of such risks and uncertainties or to publicly announce the result of anyrevisions to the forward-looking statements made herein, except where they would be required to do so under applicable law.
Banyan Tree is under no obligation to keep current the information contained in this document and any opinions expressed init are subject to change without notice. None of Banyan Tree or any of its affiliates, advisers or representatives shall haveany liability whatsoever for any loss whatsoever arising from any use of this document or its contents, or otherwise arising inconnection with this document (whether direct, indirect, consequential or other). This document is not intended to provideprofessional advice and should not be relied upon in that regard. Prospective investors should consult their tax, legal,accounting or other advisers.
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Agenda
1. Overview Eddy See
2. Key Segments Performance Review Kuan Chiet
3. Future Plans Ho KwonPing
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Overview
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OverviewGroup Financial Highlights
Revenue � 4% and Operating Profit � 11% :
� � revenue recognition from Property Sales segment.
� � operating expenses.
� Partially offset by lower other income as FY17 recorded higher gain from divestment of China entities.
Cash Earnings � 38% to S$44.1 million.
Proposed dividend of 1.05 cent/share.
Hotel Investment – forward bookings in 1Q19 �8%
Property Sales – unrecognised revenue from sold properties S$190m (�14%); 40% to be recognized in 2019.
* Variance is computed based on figures to the nearest thousands & in line with announcement in SGXNet.** Computed based on PATMI adjusted for non-cash items i.e. depreciation, amortisation expense, fair value adjustments on long term investments/investment properties, impairments, fixed assets written off and
effective interest adjustment on receivables. These non-cash items are after MI adjustments.
FY17 (S$’M) FY18 (S$’M) Change*
REVENUE 317.5 329.0 4%
OPERATING PROFIT 74.7 83.1 11%
CASH EARNINGS** 31.9 44.1 38%
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EBITDA
S$0.9b S$83m
Enterprise Value5
NAV2 Per Share Share Price3 / NAV Cash and Cash Equivalents
Net Gearing Ratio4
S$0.77 S$206m
47%
23% discount
Note:1. Financial figures as at 31-Dec-18.2. NAV denotes Net Asset Value.3. Share price based on closing share price of S$0.595 as at 11 Feb 2019.4. Gearing ratio is defined as net debt divided by total equity (includes minority interests).5. Enterprise value (EV) defined as sum of Market Capitalization, Debt and Minority Interest, less Cash.
EV/EBITDA
11x
Key Figures1
7
Key Segments Business Review
8
Hotel & Fee-Based Business
9
(2.8)0.8
(3.4)
2.7 6.9 4.4
18.7 15.3
-$4.0
$0.0
$4.0
$8.0
$12.0
$16.0
$20.0
$24.0
$28.0
4Q17 4Q18 FY17 FY18
Non-Thailand Thailand
S$'M QTD YTD
���� 2.7m
���� 1.1m
Net S$4.1mNet S$5.2m
Net S$15.3m
Net S$18.0m
Hotel Investments – Financial PerformanceOperating Profit
Owned Hotels1Highlights
1. Hotel management fees attributed for hotels managed and owned by BTH was allocated to hotel management segment.
QTD:
� Absence of PPE written off in Morocco in 4Q17.
� � profit from Cassia Bintan.
Partially offset by:
� � profit from Thailand.
� Absence of profit from Seychelles after disposal.
YTD:
� Absence of PPE written off.
� Non-consolidation of China operations which recorded losses in FY17.
� � profit (Indonesia).
Partially offset by:
� � profit (Thailand/Maldives).
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1.8 1.2 1.4 1.9 0.4 0.2 1.3 2.6
6.5 2.9
20.5
24.2
$0.0
$5.0
$10.0
$15.0
$20.0
$25.0
$30.0
$35.0
4Q17 4Q18 FY17 FY18
Design and Others Spa/Gallery Hotel Management
S$'M QTD YTD
���� 5.5m
���� 4.4mTotal S$8.7m
Total S$4.3m
Total S$23.2m
Total S$28.7m
Fee-Based Business – Financial PerformanceOperating Profit Highlights
1. Hotel management fees attributed for hotels managed and owned by BTH was allocated to hotel management segment.2. Hotel management revenue includes royalty fees.
QTD:
� � architectural & design fees due to project milestones.
� � foreign exchange losses.
� � reservation & marketing expenses (timing diff.).
YTD:
� � hotel management fees.
� � provision for doubtful debts.
� � foreign exchange losses.
� � staff costs.
Partially offset by:
� � architectural & design fees due to project milestones.
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67%
58%
61% 60%
64%
58%
64%
62%
56%
58%
60%
62%
64%
66%
68%
70%
1Q 2Q 3Q 4Q
%
2018 2017
2018
2017
FY17: 62%
FY18: 62%
Hotel Operating Performance – Ave Occupancy (%)
All Hotels (Same Store1) Highlights
1. Same Store Concept excludes all new resorts opened in the past 2 years as they take on an average two years to stabilize.
QTD:
� � 2% points due to resorts in Thailand, Maldives, China and Indonesia.
YTD:
� In line with last year
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383
317 310 304
376
319 326
359
300
315
330
345
360
375
390
1Q 2Q 3Q 4Q
S$
2018 2017
2018
2017
FY17: 345
FY18: 330
Hotel Operating Performance – Ave Room Rates (S$)
All Hotels (Same Store1) Highlights
QTD:
� � 15%
YTD:
� � 4%
Both periods � due to resorts in Thailand, China, Maldives and Indonesia.
1. Same Store Concept excludes all new resorts opened in the past 2 years as they take on an average two years to stabilize.
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257
185 188
182
240
186
208
222
175
190
205
220
235
250
265
1Q 2Q 3Q 4Q
S$
2018 2017
2018
2017
FY17: 214
FY18: 203
All Hotels (Same Store1) Highlights
Hotel Operating Performance – RevPAR (S$)
QTD:
� � 18%
� Due to lower OCC % andARR.
YTD:
� � 5%
� Due to lower ARR.
1. Same Store Concept excludes all new resorts opened in the past 2 years as they take on an average two years to stabilize.
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Room Revenue Of Owned Hotels
By Country Of Residence
* Others originated mainly from United States, Australia, Canada, India and New Zealand.
China22%
Europe29%Russia
11%
Middle East7%
NE Asia14%
SE Asia6%
Others*11%
FY18
6.3m
106.7m
China24%
Europe28%
Russia11%
Middle East7%
NE Asia13%
SE Asia5%
Others*12%
FY17
105.5m
25.6m
29.2m
11.3m
7.8m
12.6m
4.8m
14.9m
11.7m
11.7m
30.8m
23.8m
14.2m
7.4m
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Room Revenue Of All Hotels
By Country Of Residence
* Others originated mainly from United States, Australia, Canada, India and New Zealand.
China44%
Europe15%
Russia4%
Middle East3%
NE Asia14%
SE Asia5%
Others*15%
FY18
16.2m
324.3m
China44%
Europe14%
Russia4%
Middle East3%
NE Asia15%
SE Asia5%
Others*15%
FY17
319.9m
140.8m
45.5m12.8m
11.0m
47.5m
14.3m
45.3m
47.5m
13.5m
48.4m
142.2m
48.0m
11.2m
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6.1 6.5 4.1 4.1
9.1 8.5
14.5 13.0 4.1 3.8
3.2 3.8
5.6 5.6
5.6 5.4
$0.0
$5.0
$10.0
$15.0
$20.0
$25.0
2Q17 2Q18 3Q17 3Q18 4Q17 4Q18 1Q18 1Q19
Thailand Non-Thailand
���� 10%
���� 8%
7.9
10.2 10.3
7.3
18.420.1
14.714.1
US$'M
���� 4%
Hotel Business – Forward BookingsOwned Hotels1 (Same Store2)On-The-Book (“OTB”) Room Revenue
Highlights
1. Owned Hotels refer to hotels we have ownership interest (> 50%) in.2. Same Store Concept excludes all new resorts opened/rebranded in the past 2 years as they take on an average two years to stabilize.3. Based on OTB as at mid of January 2019.
1Q19 vs 1Q18:
� Thailand � 10%.
� Non-Thailand � 4%.
� Overall � 8%.
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14.6 17.9
8.1 8.9 11.4 10.5
17.9 15.7
22.4
26.4
21.4 21.1 20.2 21.0
24.5 22.5
$0.0
$10.0
$20.0
$30.0
$40.0
$50.0
2Q17 2Q18 3Q17 3Q18 4Q17 4Q18 1Q18 1Q19
Thailand Non-Thailand
US$'M
37.0
44.3
29.5 30.031.6 31.5
42.4
38.2
���� 13%
���� 8%
���� 10%
Hotel Business – Forward BookingsAll Hotels (Same Store1)
On-The-Book (“OTB”) Room RevenueHighlights
1Q19 vs 1Q18:
� Thailand � 13%.
� Non-Thailand � 8%.
� Overall � 10%.
1. Same Store Concept excludes all new resorts opened/rebranded in the past 2 years as they take on an average two years to stabilize.
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No. of Keys
No. of Hotels: 81 10039 41 47 54 6429 32 34 35 3719 22 2517
706 798 1,100 1,436 1,698 1,897 2,116 2,284 2,405 2,338 2,547 2,794 2,911 3,300 3,481
4,638
442 859 475
998
1,618 1,746
1,827 2,220 2,226
1,699 1,699
2,113
3,353 3,380
4,068
4,419
229
229 285
486
486 486
868
1,168
--
516 516
714
714
1,517
3,017
3,957
112 112 112
112
112 112
112
112 112 187
112
437
437
651
651
651
1,260 1,769 1,687
2,546
3,428 3,755
4,055 4,616
4,972 4,969 5,159
6,544
7,901
9,334
12,085
14,833
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
11,000
12,000
13,000
14,000
15,000
16,000
2007A 2008A 2009A 2010A 2011A 2012A 2013A 2014A 2015A 2016A 2017A 2018A 2019E 2020E 2021E 2022E
Banyan Tree Angsana Cassia Dhawa Others
CAGR 2018 - 2022 = 23%
Past Current Future
(2007) (2018) (2022)
67% 27% 15%
33% 73% 85%
Owned Hotels %
Managed Hotels %
Hotel Business – Projected GrowthSteady Pipeline Growth
Number of keys1Highlights
1. Based on contracts that were already signed.
� CAGR of 23% based on contracts completion dates.
� 53 hotels to be opened in next 4 years.
� Room keys estimated to grow by 127% from about 6,500 keys in 2018 to about 15,000 keys in 2022.
� Additional keys are largely managed without any equity interest.
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Property Business
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4.2
1.1
2.9
5.5
$0.0
$1.0
$2.0
$3.0
$4.0
$5.0
$6.0
4Q17 4Q18 FY17 FY18
S$'M YTDQTD
���� 3.1m
���� 2.6m
Property Business – Financial Performance
Operating Profit1 Highlights
QTD:
� � cost of properties recognised.
� � sales commission.
� Partially cushioned by �revenue recognition.
� 41 units (4Q18) vs. 31 units in 4Q17 (4Q17).
YTD:
� � revenue recognition from higher value of properties although lower units recognised.
� 128 units (FY18) vs. 139 units (FY17).
1. Based on completed contract method of revenue recognition.
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$63.6
$37.2
$137.8 $125.6
101
57
195 211
$-
$15
$30
$45
$60
$75
$90
$105
$120
$135
$150
0
20
40
60
80
100
120
140
160
180
200
220
4Q17 4Q18 FY17 FY18
Gross Sales (Value) Gross Sales (Qty)
Unit S$'MQTD YTD
Property Business – Financial Performance
Sales Progress Highlights
YTD:
� 211 units sold (S$125.6m) vs. 195 units (S$137.8m) in FY17.
� Unrecognised Revenue at S$190 million; 40% to be recognised in FY19.
units
units
units units
Recognised in Year S$'M
2019 74.6
2020 70.3
2021 45.0
Unrecognised Revenue
as at 31.12.2018: S$189.9m
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Property Business - Outlook
Encouraging property sales momentum in Phuket
� Continuing strong response for Cassia Phuket and Laguna Park Phuket.
� Cassia Phuket (Ph. 3) launched end 2017 well received; 73% (out of 193 units) sold to date.
� In FY18, 144 units with total value of S$62 million sold for both properties; � 26% (units) & �
24% (value).
� Newly launched Banyan Tree 3 Bed Pool Villas (8 units amounting to S$15.9 million) fully sold byyear end.
S$190 million of unrecognised revenue, ���� 14% vs FY17.
� About 40% to be recognised in 2019, remaining in 2020 - 2021.
Redoubling of outreach effort and making our products and pricing more appealing amidstglobal slow down.
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Future Plans
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Brand HMA MOU
Banyan Tree 6 13
Angsana 10 10
Cassia 2 3
Dhawa 10 15
Total 28 41*
Future Plans – New Hotels Contracts Signed in 2018 - YTD
* Include 21 Accor / Vanke leads.
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2020
2021
202210 new hotelsBT = 4
AN = 3
DH = 3
17 new hotelsBT = 4
AN = 5
CA = 2
DH = 6
19 new hotelsBT = 12
AN = 2
CA = 1
DH = 4
2019
7 new hotelsBT= 1
AN = 6
Future Plans – 53 Hotels to be opened
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Future Plans – Property Sales
Existing Land Bank
Land size (Hectares) 120
Gross Development Value (S$’Billion) 2.3
2019: Projects activated for development
No. of Projects 5
Land size (Hectares) 9
Gross Development Value (S$’Billion) 0.3
Percentage of land bank to be utilized (Land size) 8%
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Mission Statement
“ We want to build globally recognised brands
which by inspiring exceptional experiences among
our guests, instilling pride and integrity in our
associates and enhancing both the physical and
human environment in which we operate, will
deliver attractive returns to our shareholders. ”
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Thank You