Keppel Ltd. · SGX:BN4

Keppel — 1H 2018 Earnings Presentation

32 slides from Keppel's earnings presentation, Jul 19, 2018

  1. Slide 1: Second Quarter and First Half 2018 Financial Results

    Second Quarter and First Half 2018 Financial Results 19 July 2018 1 Scope of Briefing  Address by CEO  Group Financial Highlights by CFO Note: 2017 financial figures in this presentation have been restated following the adoption of the new financial reporting framework, Singapore Financial Reporti

  2. Slide 2: Address by CEO

    Address by CEO 3 Solutions for Sustainable Urbanisation Keppel is an ecosystem of companies working together, with a common purpose, to meet the growing demand for energy, clean environments, urban spaces and connectivity. 4

  3. Slide 3: Financial Performance

    Financial Performance 1H 2018 net profit  Net profit was S$583m S$583m, up 38% yoy  EVA was S$275m  Annualised ROE was 9.9% 583 66  Free cash inflow of S$886m in 1H 2018, 423 vs inflow of S$204m in 1H 2017 163  Net gearing was 0.40x at end-Jun 2018 603 57 vs 0.46x at end-Dec 2017 S$m 192  Decl

  4. Slide 4: Offshore & Marine

    Signed agreement for sale of five existing rigs to Borr Drilling for US$745m Offshore & Marine 7 Offshore & Marine  Net loss due to lower work volume and 1H 2018 net loss associate contributions, and higher S$40m overseas taxes  Lower overheads contributed to S$14m operating profit in 1H 2018  1H

  5. Slide 5: Offshore & Marine orderbook and highlights

    Offshore & Marine Net orderbooki Key Highlights S$4.6b as at end-Jun 2018  Delivered an FPSO, a dual-fuel LNG tug and 2nd Borr jackup in 2Q 2018 4.6  Hilli Episeyo now in full commercial 3.9 0.2 operation offshore Cameroon 0.9 0.1 0.7  Won S$1.8b of orders for gas solutions since 2015, comprising

  6. Slide 6: Property

    Property 1H 2018 net profit Key Highlights S$603m, up 214% yoy  Net profit underpinned by higher contributions from Singapore and China 603 31  Announced in 2Q 2018: 47  En bloc sale of two residential developments in Shenyang and sale of stake in Quoc Loc Phat for total 534 S$m 25 192 of S$350m

  7. Slide 7: Property Portfolio

    Property Portfolio  Residential landbank of ~50,000 homes of which over 16,000 are launch-ready  Commercial portfolio provides steady recurring income Residential Commerciali Launch-ready homes (units) Gross floor area (sm) 924,500 16,040 110,100 1,790 50,000 1,740 92,500 770 545,000 289,400 11,90

  8. Slide 8: Infrastructure

    Keppel Marina East Desalination Plant, Singapore Infrastructure 15 Infrastructure Key Highlights 1H 2018 net profit  Keppel Infrastructure continues to deliver S$66m, up 16% yoy steady earnings  Keppel Marina East Desalination Plant 66 (KMEDP) close to 50% completed 57 31  Hong Kong Integrated Wa

  9. Slide 9: Investments

    Keppel DC REIT completed acquisition of Keppel DC Singapore 5 Investments 17 Investments 1H 2018 net loss Key Highlights S$46m  Performance impacted by share of losses from associated companies and fair value losses on investments 163  Keppel Capital contributing steadily and continues to look to

  10. Slide 10: Group Financial Highlights by CFO

    Shaping the Future 50 & Beyond 19 Group Financial Highlights by CFO 20

  11. Slide 11: 2Q 2018 Financial Performance and Highlights

    2Q 2018 Financial Performance Net Profit 44% to S$246m EPS 45% to 13.6cts EVA from negative S$34m to positive S$89m 21 2Q 2018 Financial Highlights S$m 2Q 2018 2Q 2017 % Change Revenue 1,523 1,554 (2) EBITDA 301 206 46 Operating Profit 257 149 72 Profit Before Tax 281 215 31 Net Profit 246 171 44 EP

  12. Slide 12: 2Q 2018 Revenue and Pre-tax Profit by Segments

    2Q 2018 Revenue by Segments S$m 2Q 2018 % 2Q 2017 % % Change Offshore & Marine 607 40 449 29 35 Property 244 16 542 35 (55) Infrastructure 647 42 521 33 24 Investments 25 2 42 3 (40) Total 1,523 100 1,554 100 (2) 23 2Q 2018 Pre-tax Profit by Segments S$m 2Q 2018 % 2Q 2017 % % Change Offshore & Marin

  13. Slide 13: 2Q 2018 Net Profit by Segments; 1H 2018 Performance

    2Q 2018 Net Profit by Segments S$m 2Q 2018 % 2Q 2017 % % Change Offshore & Marine (17) (7) 11 6 nm Property 225 92 97 57 132 Infrastructure 40 16 25 15 60 Investments (2) (1) 38 22 nm Total 246 100 171 100 44 25 1H 2018 Financial Performance Net Profit 38% to S$583m EPS 38% to 32.2cts Annualised ROE

  14. Slide 14: 1H 2018 Financial Highlights and Revenue by Segments

    1H 2018 Financial Highlights S$m 1H 2018 1H 2017 % Change Revenue 2,993 2,802 7 EBITDA 815 446 83 Operating Profit 725 333 118 Profit Before Tax 711 504 41 Net Profit 583 423 38 EPS (cents) 32.2 23.3 38 27 1H 2018 Revenue by Segments S$m 1H 2018 % 1H 2017 % % Change Offshore & Marine 939 31 932 33 1

  15. Slide 15: 1H 2018 Pre-tax and Net Profit by Segments

    1H 2018 Pre-tax Profit by Segments S$m 1H 2018 % 1H 2017 % % Change Offshore & Marine (26) (4) 13 3 nm Property 698 98 234 46 198 Infrastructure 74 11 72 14 3 Investments (35) (5) 185 37 nm Total 711 100 504 100 41 29 1H 2018 Net Profit by Segments S$m 1H 2018 % 1H 2017 % % Change Offshore & Marine

  16. Slide 16: Net Profit & EPS; ROE & Dividend

    Net Profit & EPS Net profit (S$m) EPS (Cents) 1,846 1,885 102.3 103.8 1,525 84.0 685 726 38.0 39.9 405 22.3 457 414 363 815 25.3 22.9 20.0 44.8 784 43.2 143 128 7.9 6.9 583 32.2 347 406 397 225 264 19.2 22.3 21.9 12.4 14.6 246 13.6 205 171 11.3 9.4 357 339 360 252 337 19.8 18.7 19.8 13.9 18.6 211 11

  17. Slide 17: Free Cash Flow; Results Q&A

    Free Cash Flow 1H 2018 1H 2017 S$m S$m Operating profit 725 333 Depreciation & other non-cash items (400) (88) 325 245 Working capital changes 179 114 Interest & tax paid (147) (232) Net cash from operating activities 357 127 Investments & capex (65) (75) Divestments & dividend income 833 184 Advanc

  18. Slide 18: Additional Information: Revenue by Geography

    Additional Information 35 Revenue by Geography 1H 2018 Total Overseas Singapore S$m Customers Customers % % Offshore & Marine 939 92 8 Property 787 54 46 Infrastructure 1,211 11 89 Investments 56 1 99 Total 2,993 47% of total revenue came from overseas customers 36

  19. Slide 19: EBITDA by Segments; Capital/Gearing/ROE

    EBITDA by Segments S$m 1H 2018 % 1H 2017 % % Change Offshore & Marine 65 8 116 26 (44) Property 674 83 187 42 260 Infrastructure 74 9 72 16 3 Investments 2 - 71 16 (97) Total 815 100 446 100 83 37 Capital/Gearing/ROE S$m 30 Jun 2018 31 Dec 2017 Shareholders’ Funds 11,667 11,443 Total Equity 12,202 1

  20. Slide 20: Offshore & Marine

    OFFSHORE & MARINE 39 Financial Highlights – Offshore & Marine S$m 2Q 2018 2Q 2017 % Change Revenue 607 449 35 EBITDA 31 76 (59) Operating Profit 6 42 (86) (Loss)/Profit Before Tax (11) 15 nm Net (Loss)/Profit (17) 11 nm 40

  21. Slide 21: Financial Highlights – Offshore & Marine

    Financial Highlights – Offshore & Marine S$m 1H 2018 1H 2017 % Change Revenue 939 932 1 EBITDA 65 116 (44) Operating Profit 14 46 (70) (Loss)/Profit Before Tax (26) 13 nm Net (Loss)/Profit (40) 11 nm 41 Offshore & Marine Review  Over S$1.2b in contracts secured in 1H 2018: A semi-submersible, a dua

  22. Slide 22: Offshore & Marine Orderbook

    Offshore & Marine Orderbook Contract Value Gross Net Client S$m S$m For delivery in 2018 3 JUs/1 FPSO Modules Fab. & Integration/ 1 Hull Carry Over Works/1 FPSO Modification & Upgrade/ Grupo R/Clearwater/Petrobras/ 1 FPSO Conversion/2 Dredgers/1 Dual Fuel Tug 1,674 94 Woodside/Dixstone/Jan De Nul/Ma

  23. Slide 23: Financial Highlights - Property

    Financial Highlights - Property S$m 2Q 2018 2Q 2017 % Change Revenue 244 542 (55) EBITDA 221 110 101 Operating Profit 214 99 116 Profit Before Tax 243 121 101 Net Profit 225 97 132 45 Financial Highlights - Property S$m 1H 2018 1H 2017 % Change Revenue 787 804 (2) EBITDA 674 187 260 Operating Profit

  24. Slide 24: Sales Achieved - Overseas; Residential Landbank - Singapore

    Sales Achieved - Overseas Units Sold Sales Value Latest Avg. Key Projects Location in 1H 2018 in 1H 2018 Selling Price China (RMB’m) (RMB’psm) Park Avenue Heights 41 181 ~31,800 Chengdu Serenity Villas 40 163 ~12,400 Seasons Garden, Tianjin Eco-City Ph 2 33 74 ~18,000 Tianjin Seasons Residences, Tia

  25. Slide 25: Residential Landbank - China; Other Overseas

    Residential Landbank - China Total GFA Total Units Units Remaining Units Remaining Area China Location Stake (sm) Units Launched Sold For Sale For Sale (sm) 8 Park Avenue 99% 133,393 918 918 895 23 6,377 Seasons Residences Shanghai 100% 128,918 1,102 1,062 1,058 44 4,265 Sheshan Riviera 99.4% 83,174

  26. Slide 26: Residential Launch Readiness

    Residential Launch Readiness – China Units Ready to Launch Project Location 2H 2018 2019 2020 8 Park Avenue 1 12 10 Seasons Residences Shanghai 3 41 - Sheshan Riviera^ 12 52 58 Park Avenue Heights 16 - - Hill Crest Villas^ - 42 36 Chengdu Serenity Villas^ 18 26 24 V City^ 892 - - Waterfront Residenc

  27. Slide 27: Expected Completion for Launched and Upcoming Projects

    Expected Completion for Launched Projects Total Units Launched as Units Sold as at Units Remaining Expected Projects/Phases launched Location Units at end-Jun 2018 end-Jun 2018 as at end-Jun 2018 Completion China Sheshan Riviera Shanghai 112 53 18 94 2H18 Waterfront Residences Wuxi 236 236 236 - 2H1

  28. Slide 28: Commercial Projects - Under Development and Completed

    Commercial Projects - Under Development Projects under Development Location Stake GFA (sm) Development Cost(1) Completion China Beijing Commercial (2) Beijing 51% 104,800 RMB2.7b 2020 Park Avenue Central Shanghai 99% 115,900 RMB2.9b 2022 Seasons City Tianjin 100% 161,800 RMB2.6b 2020 (Ph 1) Indonesi

  29. Slide 29: Financial Highlights - Infrastructure

    INFRASTRUCTURE 57 Financial Highlights - Infrastructure S$m 2Q 2018 2Q 2017 % Change Revenue 647 521 24 EBITDA 46 35 31 Operating Profit 35 24 46 Profit Before Tax 44 35 26 Net Profit 40 25 60 58

  30. Slide 30: Infrastructure 1H 2018; Investments

    Financial Highlights - Infrastructure S$m 1H 2018 1H 2017 % Change Revenue 1,211 988 23 EBITDA 74 72 3 Operating Profit 52 50 4 Profit Before Tax 74 72 3 Net Profit 66 57 16 59 INVESTMENTS 60

  31. Slide 31: Financial Highlights - Investments

    Financial Highlights - Investments S$m 2Q 2018 2Q 2017 % Change Revenue 25 42 (40) EBITDA 3 (15) nm Operating Profit/(Loss) 2 (16) nm Profit Before Tax 5 44 (89) Net (Loss)/Profit (2) 38 nm 61 Financial Highlights - Investments S$m 1H 2018 1H 2017 % Change Revenue 56 78 (28) EBITDA 2 71 (97) Operati

  32. Slide 32: Forward-looking statements

    This presentation 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

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