scope of briefing...1 9m 2009 results announcement 22 october 2009 1 22 october 2009 scope of...
TRANSCRIPT
1
9M 2009 Results Announcement22 October 2009
111
22 October 2009
Scope of Briefing
• Address by Chief Executive Officer
• Group Financial Highlights
• Business Review & Outlook
222
• Business Review & Outlook
2
Address By
Chief Executive Officer
333
Improving Environment
• Some signs of recovery in global economyg y g y
China expected to grow beyond 8%US housing construction in August highest in nine monthsEurope looks on track to exit recession in 3Q09Singapore GDP forecast revised upwards to -2.5% to -2%to -2%
• Cautious optimism for modest near term growth
4
3
Sustaining Our Performance
• PATMI grew 11% for 9M09 and 17% for 3Q09
• Annualised ROE reached 23%
5
Encouraging Developments
Some signs that offshore & i
Positive sentiments in k t
Strong potential in
i t l & marine orders returning
key property markets yield healthy sales
environmental engineering business
6Continue seeking out growth opportunities
4
Group Financial Highlights
777
9M09 Financial Performance
PATMI* 11% to S$922m
EPS
Annualised ROE
EVA*
Free Cash Flow
11% to S$922m
10% to 57.9cts
from 22.4% to 23.0%
S$101m to S$715m
46% to S$1 001m
8
Free Cash Flow
Net Cash
46% to S$1,001m
from 0.04x to 0.12x
* Excludes Exceptional Gains
5
Financial Highlights
S$m 9M 2009 % Change9M 2008
Revenue 9,218 14EBITDA 1,211 28Operating Profit 1,092 29Profit Before Tax 1,353 13PATMI* 922 11EPS (cents) 57.9 10
8,071949848
1,200834
52.4
9
*Excludes Exceptional Gains of S$422m
S$m9M 2009 % % Change
Revenue by Segments
9M 2008 %
Offshore & Marine 6,501 71 16Property 909 10 26Infrastructure 1,771 19 2
Investments 37 - 42
Total 9,218 100 14
5,581 69722 9
1,742 22
26 -8,071 100
10
6
S$m9M 2008 %9M 2009 % % Change
Pre-tax Profit by Segments
Offshore & Marine 816 60 26
Property 307 23 15
Infrastructure 114 8 119
Investments 116 9 (50)
Total 1,353 100 13
54
22
4
20
100
646
268
52
234
1,200
11
S$m% Change
PATMI by Segments
9M 2008 %9M 2009 %
Offshore & MarinePropertyInfrastructureInvestmentsTotal
609 66133 14
81 999 11
922 100
261598
(49)
11
484 58116 14
41 5193 23
834 100
12
7
Consistent Earnings Growth
PATMI (S$m) EPS (Cents)
1,097 69.0
465 29.9564 36.1
751 47.7
1,026 64.9
2Q: 2Q:
3Q: 3Q:
4Q:4Q: 922 57.9
2Q: 2Q:
3Q: 3Q:
131H 2H
1Q: 1Q:1Q: 1Q:
Healthy Free Cash Flow
9M 2009S$m
Operating profit 1,092Depreciation & other non-cash items 134
Working capital changes (846)
Net cash from operating activities 228
Interest & tax paid (152)
1,226
14
Net cash from investing activities 773
Free Cash Flow 1,001
Investments & capex (814)Divestments & dividend income 1,587
Dividends Paid (639)
8
Business Review & Outlook
151515
Offshore & Marine
161616
9
Long-Term Fundamentals Remain Sound
World Energy Consumption, 2006 – 2030
1717Sources: 2006 – Energy Information Administration (EIA) International Energy Annual 2006 (Jun-Dec 2008)
Projections – EIA, World Energy Projections Plus (2009)
• FloaTEC signed Letter of Intent for P-61 TLWP
New Projects
FloaTEC signed Letter of Intent for P 61 TLWP for Petrobras
• Rowan’s fourth jackup confirmed at Keppel AmFELS in Brownsville
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10
Continuing Execution Excellence
Completed YTDCompleted YTD 4Q094Q09
3 semis
7 jackups
1 FSO
4 major conversions/upgrades
2 semis
3 jackups
1 semi completion
2 major conversions/upgrades
191919
$6b net orderbook with deliveries into 2012
conversions/upgrades
9 specialised vessels
/ pg
9 specialised vessels
Property
202020
11
Market Review
SingaporeSingapore OverseasOverseas
• Sales volume in China remains high
• In Vietnam, sentiments continue to improve
• Private home prices grew 15.9% q-on-q in 3Q09
• Record sales volume expected
2121
• Some signs of recovery in Indonesia and India
• Growing business confidence stemmed decline in office rentals
Healthy Sales Volume
Project Sales in 3Q09
The Promont 7The Promont 7
Madison Residences 45
Caribbean at Keppel Bay 109
Reflections at Keppel Bay 23
Singapore
2222
Overseas
Country Sales in 3Q09
China 900
Vietnam 63
Indonesia 109
India 64
12
K-REIT Asia Rights Issue
• Strengthening capital structure for greater • Strengthening capital structure for greater flexibility
• Positioning for strategic acquisitions in Singapore and across Asia
Financing asset enhancement initiatives to
232323
• Financing asset enhancement initiatives to maximise rental income
Infrastructure
242424
13
Securing Stable Income Stream
Acquisition of SenokoI i ti Pl tIncineration Plant
Only private operator of incineration plants for municipal solid waste in Singapore
25
Generates strong cash flow and recurring earnings
Seed asset for Keppel Green Trust
Major Projects Near Completion
Keppel Seghers TuasWaste-To-Energy Plant
Qatar Domestic Solid Waste Management Facility
26
When completed, these projects will add significantly to recurring income and cash flow for Infrastructure Division
14
Outlook
Focused on Product and Execution Excellence
for Value Creation
272727
9M 2009 Results
Thank YouQ&A
282828
15
Additional Info
29
S$m 3Q 2008 % Change
Financial Highlights
3Q 2009$ 3Q 2008 % Change
Revenue (6)EBITDA 26Operating Profit 29Profit Before TaxPATMI
3Q 2009
3,038455420487319
2217
3,217360325400273
30
16
Total SingaporeOverseas9M 2009
Revenue by Customers
g pS$m %%
Offshore & Marine 6,501 5
Infrastructure 1,771 57Property 909 66
Investments 37 59Total 9,218 20
95
4334
4180
31
80% of total revenuecame from overseas customers
S$m%9M 2009 % % Change
EBITDA by Segments
9M 2008
Offshore & Marine 70843Property 20248Infrastructure 123
Investments (3)Total 1,211 100 28
10
-
34(4)
137NM
6662827257
52
12949 100
6
1
32
17
Capital/Gearing/ROE
S$m 30 Sep 2009 31 Dec 2008
Shareholders' Funds
Capital Employed Net CashNet Cash RatioROE
5,659
8,236
9990.12x
23.0%*
4,596
6,749
2750.04x
22.4%
33* Annualised ROE
Offshore & Marine
34
18
S$m 9M 2008 % Change
Financial Highlights –Offshore & Marine
9M 2009$ 9M 2008 % Change
Revenue 16EBITDA 34Operating Profit 36Profit Before TaxPATMI
9M 2009
6,501843759816609
2626
5,581628559646484
35
S$m 3Q 2008 % Change
Financial Highlights –Offshore & Marine
3Q 2009$ 3Q 2008 % Change
Revenue (10)EBITDA 13Operating Profit 14Profit Before TaxPATMI
3Q 2009
2,124295272293215
119
2,362262238264197
36
19
Offshore & Marine Review
S$85m contracts secured in 3Q 2009:$ Q1 FPSO Upgrade, 1 FSRU Conversion, 2 Tugs, 2 Semi Upgrades, 1 JU Upgrade
Major contract completions in 3Q 2009:
37
1 Semi, 6 Semi Upgrades, 2 JUs, 1 JU Upgrade, 3 FPSO/FSO Conversions, 1 FSO, 2 Ice-Class Standby/Rescue Vessels, 2 AHTS, 1 Tanker Barge
Offshore & Marine OrderbookClientsBalance
Order
S$m
QGP / Seadrill / Noble / Great Eastern / Petrovietnam / For delivery in 2009
For deli er in 2011
QGP / Seadrill / Noble / Great Eastern / Petrovietnam / Perforadora Central / BW Offshore / Premuda / Seaways / Whitesea / Hadi Hammam / Greatship / Keppel Smit / Agip KCO
2 Semis / 1 Semi Completion / 3 Jack Ups / 2 FPSO Conversions/Upgrades / 4 AHTS / 2 PSVs / 2 Tugs / 1 Pontoon 104
For delivery in 2010
6 Semis / 7 Jack Ups / 4 FPSO Conversions/Upgrades / 1 FSRU Conversion/FPSO Modules/Integration / 1 Turret/Pipe Racks & Pontoon / 1 Derrick Pipelay Vessel / 1 Pipelay Barge / 1 Derrick Barge Upgrade / 2 AHTS / 2 PSVs / 2 Drillship Outfittings / 6 Tugs 2,627
Maersk / Ensco / Floatel / Petrobras / Skeie / Rowan / Seadrill / SBM / Golar / Agip KCO / Global Offshore / Bumi Armada / Smit International / Greatship / Frontier Drilling / Keppel Smit / Salalah Port
38TOTAL as at 30 Sep 2009 5,772
For delivery in 2011
3 Semis / 2 Jack Ups / 1 Derrick Pipelay Vessel / 6 Tugs / 2 AHT 1,642
Ensco / QGP / Seadrill / Skeie / Rowan / Global Offshore / Keppel Smit / Seaways
For delivery in 2012
2 Semis 1,399 Ensco
20
Property
39
S$m 9M 2008 % Change
Financial Highlights – Property
9M 2009$ 9M 2008 % Change
Revenue 26EBITDA (4)Operating Profit (4)Profit Before TaxPATMI
9M 2009
909248239307133
1515
722257249268116
40
21
S$m 3Q 2008 % Change3Q 2009
Financial Highlights – Property
$ 3Q 2008 % Change
Revenue 72EBITDA 35Operating Profit 36Profit Before TaxPATMI
3Q 2009
362105102129
544846
21178758737
41
Infrastructure
42
22
S$m 9M 2008 % Change
Financial Highlights – Infrastructure
9M 2009$ 9M 2008 % Change
Revenue 2EBITDA 137Operating Profit 250Profit Before TaxPATMI
9M 2009
1,771123
98114
81119
98
1,74252285241
43
S$m 3Q 2008 % Change
Financial Highlights – Infrastructure
3Q 2009$ 3Q 2008 % Change
Revenue (14)EBITDA 114Operating Profit 185Profit Before TaxPATMI
3Q 2009
54845373525
6767
63921132115
44
23
Investments
45
S$m 9M 2008 % Change
Financial Highlights – Investments
9M 2009$ 9M 2008 % Change
Revenue 42EBITDA NMOperating Profit NMProfit Before TaxPATMI
9M 2009
37(3)(4)
11699
(50)(49)
261212
234193
46
24
S$m 3Q 2008 % Change
Financial Highlights – Investments
3Q 2009$ 3Q 2008 % Change
Revenue (20)EBITDA NMOperating Profit NMProfit Before TaxPATMI
3Q 2009
410
93025
74
5(1)(1)2824
47
Thi l t i f d l ki t t t hi h This release may contain forward-looking statements which are subject to risks and uncertainties that could cause actual results to differ materially from such statements. Such risks and uncertainties include industry and economic conditions, competition, and legal,
governmental and regulatory changes. The forward-looking statements reflect the current views of Management on future trends
and developments.
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1
ADDRESS BY KEPPEL CORPORATION LIMITED’S GROUP FINANCE DIRECTOR, TEO SOON HOE
AT THE 3Q 2009 RESULTS PRESENTATION
THURSDAY, 22 OCTOBER 2009
Group Financial Highlights (Slide 7) 1. 9M’09 Financial Performance (Slide 8)
The Group achieved a record PATMI of $922 million for the first nine months of 2009. This represents an increase of 11% over the same period last year. EPS was 57.9 cents for the nine months and annualised ROE reached a record of 23%. EVA was 16% higher at $715 million. Free cash flow continued to be healthy at above $1 billion, despite being lower than that of the corresponding period last year. Our net cash position was 12% at the end of the quarter.
2. Financial Highlights (Slide 9)
Revenue grew more than $1 billion to reach $9.2 billion for the nine months of this year.
Operating profit improved by 29% largely attributed to better margins achieved by Offshore & Marine and Infrastructure.
Pre-tax profit and PATMI increased at a lower rate due to lower contribution from Investments Division.
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3. Revenue by Segments (Slide 10) Total revenue was 14% higher than nine months 2008. Revenue from Offshore & Marine increased by 16% over the same period last year to reach $6.5 billion. It remained the largest contributor to Group revenue at 71%. Property revenue rose 26% due to higher recognition of the Reflections at Keppel Bay project. Infrastructure Division posted a slight increase in revenue as a result of higher contribution from Doha North Sewage Treatment Plant project in Qatar, which was partially offset by lower revenue of the Keppel Merlimau Cogen Plant due to lower oil prices.
4. Pre-tax Profit by Segments (Slide 11)
Offshore & Marine recorded more than $800 million in pre-tax profit. This is attributed to higher revenue and improved margins on its orderbook. Property Division registered a 15% increase in pre-tax earnings. Infrastructure more than doubled its pre-tax profit in the first nine months of the year because of higher contribution from Doha North project and better margins earned by Keppel Energy.
5. PATMI by Segments (Slide 12)
Offshore & Marine’s PATMI grew by 26% as compared to the same period last year, and it accounted for almost two-thirds of Group PATMI. PATMI from Property increased significantly in the third quarter largely owing to improved sentiments in the property markets in Singapore and the region. Infrastructure nearly doubled its profit with better performance by Keppel Integrated Engineering and Keppel Energy. Investments recorded a decline in profit due to the sale of SPC in June 2009.
3
6. Consistent Earnings Growth (Slide 13) The Group has sustained PATMI at above $300 million in this quarter. Earnings of $922 million in the first nine months of this year have surpassed that of full year 2006. EPS has exceeded the 20 cents mark in a quarter for the first time, bringing the nine months EPS to a record of nearly 58 cents.
7. Healthy Free Cash Flow (Slide 14)
Net cash from operating activities was $228 million, despite negative working capital changes. The Group spent more than $800 million on acquisitions and operational capex. This included the acquisition of Senoko Incineration Plant, further development of our investment buildings and upgrading of offshore and marine facilities. After taking into account dividend income and divestment proceeds of approximately $1.6 billion, mainly from the sale of SPC, net cash from investing activities was $773 million. The Group’s free cash flow was at a robust level of $1 billion.
Business Review & Outlook (Slide 15)
1. Offshore & Marine (Slide 16)
1.1 Long-Term Fundamentals Remain Sound (Slide 17)
According to the Energy Information Administration’s forecast, world energy consumption is projected to expand by 44% between 2006 and 2030. Total energy demand of the non-OECD countries will increase by 73%, compared with an increase of 15% in the OECD countries. We believe that the long-term fundamentals of the oil & gas sector remain sound, and there will continue to be demand for offshore oil rigs and platforms. We will leverage on our design and construction capabilities to develop customised solutions to meet the needs of our customers.
4
1.2 New Projects (Slide 18)
We believe our multi-pronged strategy of ‘Near-Market, Near-Customer’, timely delivery, technology development and forging of long-term relationships with our customers will strengthen our position as a choice partner for solutions. A Letter of Intent has been signed with Petrobras by FloaTEC, our joint venture company with J. Ray McDermott, on the P-61 Tension Leg Wellhead Platform. Rowan has confirmed the construction of its fourth EXL class jackup rig at Keppel AmFels in Brownsville.
1.3 Continuing Execution Excellence (Slide 19) Our yards will remain busy for the rest of the year with another 17 deliveries.
2. Property (Slide 20)
2.1 Market Review (Slide 21) Sentiments in the Singapore residential property market continued to improve in the third quarter, with both prices and sales volume firming up and gaining momentum. With improving global economic outlook, office rentals are also stabilising. Outside of Singapore, property markets have benefited from the various government stimulus packages.
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2.2 Healthy Sales Volume (Slide 22) Low mortgage rates have enhanced affordability and increased buying confidence, leading to healthy sales volume in 3Q’09 across Singapore, China, India, Indonesia and Vietnam. Riding on positive sentiments in Singapore, we launched The Promont and Madison Residences as well as units in Caribbean at Keppel Bay during the quarter. We recorded encouraging sales volume. Good sales in China were registered in the quarter, while volume has also picked up in the other regional markets.
2.3 K-REIT Asia Rights Issue (Slide 23)
The shareholders of K-REIT Asia have approved the rights issue yesterday. The rights issue will raise approximately $620 million. The rights issue is part of K-REIT Asia’s long-term strategy in growing its portfolio through prudent financial management and maintaining an optimal capital structure. It will provide funding flexibility and place K-REIT Asia in a better financial position to seize future acquisition opportunities.
3. Infrastructure (Slide 24)
3.1 Securing Stable Income Stream (Slide 25) We have completed the acquisition of Senoko Incineration Plant from the Singapore government on 31 August 2009. The plant’s capacity to treat 2,400 tonnes of waste a day will enable KIE to treat more than a third of Singapore’s total volume of waste sent for incineration. Our agreement with the Singapore Government for the provision of incineration services will create a steady recurring earnings stream and generate strong cash flows for Keppel.
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3.2 Major Projects Near Completion (Slide 26) The construction of Keppel Seghers Tuas Waste-To-Energy Plant and Domestic Solid Waste Management Facility in Qatar are making progress. When completed, these projects will increase the contribution of Infrastructure Division to the Group’s recurring earnings.
4. Outlook (Slide 27) A year has passed since the global financial markets and economies were thrown into turmoil with the collapse of Lehman Brothers in September last year.
Keppel has delivered a creditable performance against this backdrop.
We will continue to focus on product innovation, on time, on budget execution and pursue new contracts to create greater value for our stakeholders.