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GD Express Carrier Berhad
Corporate Presentation
August 2016
2
Disclaimer
This confidential document (the “Presentation”) and the information contained herein do not constitute or form part of and should not be construed as, an offer to make available or for subscription, or to sell or issue or the
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among others, financial forecasts, profit projections, the achievement of anticipated levels of profitability, growth, cost and synergy of recent acquisitions, the impact of competitive pricing, the ability to obtain necessary
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risk management and the impact of general business and global economic conditions. You are cautioned not to place undue reliance on these forward-looking statements.
Such forward-looking statements are based on numerous assumptions regarding the Company's present and future business strategies and the environment in which the Company will operate in the future. Any opinions
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GD Express Carrier Berhad
Company Overview
4
Quick Take
Core Business Last mile express delivery and logistics operations
Key Focus Increase delivery volume with high operational efficiencies
Market Share One of the top express delivery companies in Malaysia
Customer-solution centric and performance based reward system
5- year CAGR for Revenue 17.5%, PBT CAGR 25.6%; Positive Operating Cash Flows and Net Cash
Differentiation Strategy
Financial
5
Snapshot
Stock Information
Share Price @
11 August 2016
RM1.54
Shares Issued @
11 August 2016
1,383million
Market Capitalisation RM 2,130 million
Listing Status Main Market of Bursa Malaysia;
Syariah-Compliant
Listing Date May 2005 (ACE Market) / Transferred to
Main Market in August 2013
Dilutive Issuance
Warrant B
Listed on 12 Feb 2015, expiring on 11 Feb 2020. Strike price MYR1.53, 1:1 GDEX mother share conversion. Outstanding ~179m.
Board Members
Dato’ Capt. Ahmad Sufian Non-Executive Chairman
Teong Teck Lean Managing Director / Group CEO
Lim Chee Seong Executive Director / CFO
Richard Chua Non-Executive Director
Woo Keng Leong Non-Executive Director
Liew Heng Heng Non-Executive Director
Adi Arman bin Abu Osman Non-Executive Director
Audrey Ho Non-Executive Director
FYE 30 June 2015 Unaudited Financial Performance
Revenue RM196.8m (+24.5%) ROE 23.5%
Net Profit RM28.0m (+19.9%) ROA 17.1%
Net
Gearing Net Cash
Dividend
Payout Ratio 41.7%
Substantial Shareholders
Mr Teong Teck Lean 37.983%
Yamato Group 22.845%
Singapore Post 11.168%
Recent Corporate Development
Yamato emerged as 2nd largest shareholder of GDEX
Yamato Group subscribed to GDEX 10% private placement on 21 Jan 2016. It increased its stake to 22.8% subsequently by acquiring more shares.
6
Investment Holding Company, Listed on the Main Market of Bursa Malaysia
Transportation Services
Renting of Computer Equipment
Facilities & Asset Management
Logistics Operations
Express Delivery
For future Regional Expansion plan
Insurance Services
Express Delivery
GDEX Group Structure
GD Venture (M) Sdn Bhd
GD Technosystem Sdn Bhd
GD Facilities and Assets
Management Sdn Bhd
GD Logistics (M) Sdn Bhd
GD Express (Singapore) Pte Ltd
GDEX Regional Alliance Pte Ltd
GD Valueguard Sdn Bhd
GD Express Sdn Bhd
100%
GD Express Carrier Bhd
100%
100%
100%
100%
100%
100%
100%
GD Distribution
Services Sdn Bhd(1)
GD Secured
Solutions Sdn Bhd(1)
GD Customised
Solutions Sdn Bhd(1)
100%
100%
100%
Note: (1) Dormant Companies
7
8.6 10.6 13.3 20.8
29.5 37.9
45.9 57.4
68.1 75.1
81.8 93.1
116.3
135.2
158.7
196.8
FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15
GDEX Group History and Mission
Vision
An Organisation of Sound
Values and Dynamic
Processes
Empowering Customers
with Value-for Money
Effective Solutions
Contributing to the Well-
Being of the Community – A
Leading Role Model in the
Logistics Service Industry
Mission
To Deliver the Most Trusted
and Professional Express
Carrier Services in the
Countries We Operate
Quality Policy
Committed to ensuring
every task is thoroughly
planned and goals
understood
Processes only
completed after checking
that the goals are met
Always searching for a
better way to carry out
the task
Striving to discover the
better way
Established in
1996, but ran
into difficulties
triggered by
1997 financial
crisis
2000
Entry of
Teong Teck
Lean as
controlling
shareholder of
GDEX
2003
First local
express
delivery
company to
obtain ISO
9001: 2000
(Quality
Management
System)
2005
Successfully
listed GDEX
on ACE
MARKET of
Bursa
Malaysia
2008
First local
express
carrier to
deploy
conveyor
systems for
both parcel
and document
sorting
2011
Entry of
Singapore
Post as
substantial
shareholder
2013
Successfully
transferred
listing to MAIN
MARKET of
Bursa
Malaysia
8
GDEX NEXT PHASE OF GROWTH
New Growth
Domestic Market Regional Expansion
• Hub expansion to increase sorting capacity
• Fleet expansion and human
capital improvement • Continue to penetrate into new
market segment.
• To continue developing global connectivity with the existing global and regional players, e.g. Fedex, DHL, UPS, TNT, Aramex, SF Global Express, as well as other potential players.
• Operations in Singapore - Handling all deliveries from Malaysia to
Singapore as well as within Singapore. - To meet major customers’ requirements • Representative Office in Indonesia - Cross borders business collaborations
with Pos Indonesia. - To set up operations in major cities in
Indonesia. • To continue our network expansion into
other countries e.g. Thailand, Vietnam, Philippines, Cambodia, Myanmar, Laos.
9
81.8 93.1 116.3
135.2 158.7
196.8
0
50
100
150
200
250
FY10 FY11 FY12 FY13 FY14 FY15
Financial Highlights
Revenue
RM million
Pre-Tax Profit
RM million
EBITDA Net Profit
8.3 9.9 12.3
19.2 24.3
31.3
10.1% 10.6% 10.6%
14.2% 15.3%
15.9%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
0
5
10
15
20
25
30
35
FY10 FY11 FY12 FY13 FY14 FY15
Pre-Tax Profit Margin
14.1 14.5 18.5 27.3
31.6 41.4
17.2% 15.6% 15.9%
20.2% 19.9% 21.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
0
10
20
30
40
50
FY10 FY11 FY12 FY13 FY14 FY15
EBITDA MarginRM million
6.0 7.0 8.7 13.6
23.4 28.3
7.3% 7.5% 7.5%
10.1%
14.7% 14.4%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
0.0
5.0
10.0
15.0
20.0
25.0
30.0
FY10 FY11 FY12 FY13 FY14 FY15
Profit After Tax MarginRM million
10
FYE Jun (RM million) FY13 FY14 FY15
Group Revenue 135.2 158.7 196.8
Y-o-Y Growth (%) +16.3% +17.4% +24.0%
Profit from operations 20.7 25.7 32.7
Y-o-Y Growth (%) +48.9% +24.2% +27.2%
Margin on operations (%) 15.3% 16.2% 16.6%
• GDEX has been able to sustain its strong growth due to its constant growth in
revenue and its operational efficiencies
• GDEX’s growth is driven by the organic growth of the Express Delivery Service
business and stronger performance in its Logistics Division
• GDEX reports lower effective tax rate as the Group was awarded Pioneer Status by
Malaysian Investment Development Authority (“MIDA”)
GD Express SB (100% owned subsidiary) obtained the Pioneer Status
Certificate from MIDA on 24 January 2014.
The first courier company to have obtained pioneer status from MIDA
Provides for the tax exemption on 70% of GDEX’s statutory income on
Integrated Logistics Services related activities
Valid for 5 years with effect from 26 Sep 2012 to 25 Sep 2017
Renewable for another 5 years upon initial expiry
Sustaining Strong Growth Up To FY15
11
• Express Delivery Service
business accounted for 95.7%
and 87.9% of group revenue and
PBT respectively for FY15.
• Logistics Division turned
profitable in FY15 on strong
volume growth, albeit with
smaller base
• Logistics Division reported
72.7% growth in revenue for
FY15 with healthy PBT margin of
45.2%
Segmental Breakdown
FY15 Revenue Contribution By Division FY15 PBT Contribution By Division
FYE Jun (RM million) FY13 FY14 FY15
Group Revenue 135.2 158.7 196.8
Y-o-Y Growth (%) +16.3% +17.4% +24.0%
Express Delivery 134.0 153.7 188.4
Y-o-Y Growth (%) +15.6% +14.7% +22.6%
Logistics 1.2 5.0 8.4
Y-o-Y Growth (%) +210.0% +316.7% +68.0%
Profit Before Tax 19.3 24.3 31.3
Y-o-Y Growth (%) +56.9% +26.0% +28.8%
Express Delivery 19.4 22.1 27.5
Y-o-Y Growth (%) +56.5% +13.9% +24.4%
Logistics (0.104) 2.2 3.8
Y-o-Y Growth (%) +44.1% NM +72.7%
Express Delivery 95.7%
Logistics 4.3%
Express Delivery 87.9%
Logistics 12.1%
GD Express Carrier Berhad
Operations Overview
13
• Adopted “Hub and Spoke” distribution system to enhance efficiencies
• 67,000 sq ft all-weather central clearing hub in Petaling Jaya, Selangor, Malaysia
• Comprehensive domestic network with a strengthened network infrastructure of 193 stations; 1 operation headquarters, 61 branches, 2 affiliate stations, 55 agents,19 lodge-in centres and 56 reseller agencies.
Customer calls
GDEX Customer
Service for a
pick-up service
GDEX assigns
dispatch to pick-up
shipments and bring
them back to the
GDEX station
Shipments
from station
are directed
to the GDEX
HQ Hub
The shipments
are sorted and
distributed at
the GDEX HQ
hub
The sorted
shipments are
sent to the
designated
GDEX stations
Shipments
delivered to
recipient
Express Delivery & Logistics Division
The Heart Of Express Delivery Services
Catering to Customers’ Logistics Needs
Customer delivers
bulk materials to
GDEX warehouse
These materials are
sorted systematically
and repacked into
customised GDEX
boxes
The boxes are
sealed and
addressed to
the recipients
The boxes are
sent to the
GDEX HQ Hub
for sorting and
distribution
The sorted
boxes are sent
to designated
GDEX stations
The boxes
are then
sent to the
recipients
• Enabling greater efficiencies and cost savings for customers through provision of innovative logistics solutions
• Boosting warehousing facilities and freight handling resources to complement express delivery services
• As at June 2015, total warehouse space (for logistics operations) is 105,726 sq ft.
14
331 335 397
453
578
FY11 FY12 FY13 FY14 FY15
Sorting Capacity, Fleet Size and Workforce
Fleet Size (No. of Trucks & Vans)
No. of Staff
Source : Company data
Sorting Capacity (Parcels per day)
• Current sorting capacity can sort 72,000 parcels per day. Able to hit 90,000 parcels per day on stretch level.
• Plans to further expand the capacity to cater for the growing demand.
30000
60000 60000
72000 72000
FY11 FY12 FY13 FY14 FY15
Parcels per day
1718 1826 2013
2315 2761
FY11 FY12 FY13 FY14 FY15
• Large fleet size is needed to service the extensive network we have established in Malaysia and Singapore.
• Also gives GDEX the economies of scale and created a barrier of entry.
• Mainly local staff due to regulations requirement. Foreign workers are hired to work in the sorting hub.
• Incentive based remuneration structure encourage higher staff productivity.
15
• GDEX pursues Six Sigma measurements into all
operational procedures
Improve quality of process outputs to minimize defects
Advance to Six Sigma to encompass elimination of
defect, overproduction, waiting, non-utilized talent,
transportation, inventory, motion, extra-processing and
achieve greater capability of performance
Well Recognized Brand Underpinned by Blue Chip Clientele
Established High Quality Customer Base Third Party Accreditation
• Successfully built up strong customer base by:
Delivering services with international standards
Producing the best reliability and security of
packages
Six Sigma
2012
2009
2003 • Obtained ISO 9001:2000 Certification
First domestic express carrier company in
Malaysia to achieve ISO status
• Upgraded its Quality Management System to
ISO 9001:2008
• Obtained ISO 14001:2004 certification for
Environmental Management System (EMS)
Marks a milestone in GDEX’s ongoing
commitment to protect and conserve the
environment
We have established a broad and diverse
client base over the years
Our wide sector coverage is focused on
minimising concentration risk for the company
Our client base consist of various industry
leaders in finance, retail, media, technology
and telecommunications
2013 • Frost & Sullivan Malaysia Excellence Awards -
Domestic Express Services (Provider of the Year
for the Private Sector)
2014
• Frost & Sullivan Malaysia Excellence Awards -
Domestic Express Services (Provider of the Year
for the Private Sector)
• First courier company to be awarded Pioneer
Status by the Malaysian Investment
Development Authority (MIDA)
2015
• Forbes’ Asia’s 200 Best Under A Billion
• Frost & Sullivan Malaysia Excellence Awards -
Domestic Express Services (Excellence in
Growth)
GD Express Carrier Berhad
Industry Overview
17
Top players in Malaysian market
62%
38%
International Domestics
Top 10 Players
Domestic International
Pos Laju DHL Express
GD Express Federal Express
City-Link Express United Parcel Service
Nationwide Express TNT Express
Skynet Worldwide
ABX Express
Source: Industry Performance Report 2013 by Malaysian Communication and Multimedia Commission
• International players captured larger market share (in terms of revenue) as they focus on international express service which require higher shipping rate compared with domestic shipping rate.
• Among the top ten players, GDEX captures 6.2% in 2013. • Among the six local players, GDEX captures 15% market share, after Pos Laju
(market share 23%).
18
Business Convergence
Businesses from various
sectors/industries are converging
Goods/Services will
be delivered in
Digital Platforms and Devices
Digital Form:
Movie tickets
Flight tickets
Shopping vouchers
Dining vouchers
E-Book
Physical Form:
Electrical appliances
Sports equipment
Motorcycle
Kitchen appliances
Luxury items
Efficiency is the key
Customers Suppliers Intermediaries
Customer Driven
• Sorting hub & spoke distribution channel with large number of consignment but smaller packages
Shipper A
Shipper B
Shipper C
Receiver A
Receiver B
Receiver C
Sorting Hub
19
Riding On The E-Commerce Potential in ASEAN
7.8
7.2
5.8
4 to 5 Around or below 1
Retail sales made online in 2014 (as percentage of total retail sales) Online activity in ASEAN 6*
People who go online
Online shopping in ASEAN is still at
its infancy
Make up 29% of the total population
Less than 1% of global online retail
Are young: 70% are below 35 years old
It has 3-4% of global GDP
Spend 2-4 hours per day on internet
8% of world population
Love social media: 29% of online time is spent on social media
1.3 1.3 1.0 1.7
0.9 0.8
Indonesia Malaysia Philippines Singapore Thailand Vietnam
25-30
10-15 8-12
7-10
12-15
5-7
ASEAN’s E-Commerce potential
*Note: ASEAN 6 comprises of Indonesia, Malaysia, Singapore, Thailand, Vietnam and Philippines
Market size (USD bn) 2013 level Potential
GD Express Carrier Berhad
Thank You