IJM Corporation Berhad · MYX:IJM
IJM Corporation Berhad — Shareholder Meeting (August 2013)
65 slides from IJM Corporation Berhad's shareholder meeting presentation, Aug 27, 2013
Slide 1: 29th Annual General Meeting: Review of Group Performance & Prospects FY2013
29th Annual General Meeting Review of Group Performance & Prospects FY2013 By Dato’ Teh Kean Ming CEO & Managing Director 27 August 2013
Slide 2: 30th Anniversary
years of Distinction & Pride Ws
Slide 3: Contents
Contents BUSINESS REVIEW • FY2013 Group Performance Review • Segmental Performance Reviews & Outlook CORPORATE RESPONSIBILITY • Marketplace • Community • Environment • Workplace CONCLUDING REMARKS QUESTIONS & ANSWERS
Slide 4: Group Income Statement
Performance Review Group Income Statement RM mil’ FY2013 FY2012 %∆ Revenue 4,663.4 4,517.9 3.2 Operating profit 1,019.3 972.5 4.8 Finance cost (165.8) (172.9) Operating profit after finance cost 853.5 799.6 Share of results from JV & associates (17.6) 2.0 Profit before tax 835.8 801.6 4.3 Taxation (
Slide 5: Group Balance Sheet
Group Balance Sheet Performance Review RM mil’ 31 Mar 2013 31 Mar 2012 Share capital 1,382.7 1,381.6 Shareholders’ funds 5,607.2 5,348.1 Total assets 15,121.3 13,890.5 Net assets per share (RM) 4.06 3.87 Total cash 1,766.1 1.699.0 Total borrowings 5,042.8 4,530.3 Net cash/(debt)* (3,276.7) (2,831.3)
Slide 6: Annual Group Revenue by Division
Segmental Performance Annual Group Revenue by Division RM mil’ Construction Property Industry Plantation Infrastructure Others FY2013 FY2012 Infrastructure Infrastructure Plantation Plantation Construction Construction Industry Industry Property Property 6
Slide 7: Annual Group PBT by Division
Segmental Performance Annual Group PBT by Division RM mil’ Construction Property Industry Plantation Infrastructure Others FY2013 FY2012 Plantation Infrastructure Plantation Infrastructure Construction Construction Industry Industry Property Property 7
Slide 8: Segmental Performance: Construction
Segmental Performance Construction RM’million FY2013 FY2012 %∆ Revenue 1,976.1 1,952.0 1 Profit/(loss) before tax 115.4 62.0 86 PBT % 5.8 3.2 Results Review • Revenue for the year increased marginally mainly due to work progress on large jobs such as MRT package V5 project still being at the initial
Slide 9: Construction Outlook
Segmental Performance Construction Outlook • Outstanding order book to provide job visibility for >1 year • Outlook for order book replenishment is positive • Malaysian government’s emphasis on infrastructure spending • Numerous large scale developments, esp. in Greater KL • Significant in-house job
Slide 10: Construction Project Highlights: Grand Hyatt, Kuala Lumpur
Construction Project Highlights Grand Hyatt, Kuala Lumpur
Slide 11: Construction Project Highlights: Kolej University Insaniah
Construction Project Highlights Kolej University Insaniah, Kedah
Slide 12: Construction Project Highlights: Kuantan Port Berths
Construction Project Highlights 3 new Container Berths at Kuantan Port, Pahang
Slide 13: Segmental Performance: Property
Segmental Performance Property RM’million FY2013 FY2012 %∆ Revenue 1,348.8 1,232.9 9 Profit before tax 322.9 283.9 14 PBT % 23.9 23.0 Results Review • Revenue increased mainly due to higher contribution recognised from on-going projects • PBT for the year increased in line with growth in revenue as
Slide 14: Property Outlook
Segmental Performance Property Outlook • Buyers becoming more selective, although demand for mid-range and affordable products likely to remain supported due to: • favourable demographics • resilient domestic economic outlook • accommodative mortgage rates • Short term earnings underpinned by health
Slide 15: Property Land Bank Profile
Property Land Bank Profile Malaysia Penang : 265 acres Total Area : 4,553 acres GDV : RM 5.9 bil GDV : RM 25.4 bil Klang Valley : 1,262 acres GDV : RM 8.4 bil East Malaysia : 288 acres N Sembilan & Melaka : 1,568 acres GDV : RM 2.4 bil GDV : RM 3.7 bil Johor : 1,163 acres GDV : RM 3.6 bil Overseas A
Slide 16: Property Recent Launches: Bandar Rimbayu
Property Recent Launches Bandar Rimbayu township, Selangor
Slide 17: Property Recent Launches: Rimbayu Chimes
Property Recent Launches Rimbayu Phase 1 Chimes (March 2013)
Slide 18: Property Recent Launches: Rimbayu Perennia
Property Recent Launches Rimbayu Phase 2 Perennia (August 2013)
Slide 19: Property Project Highlights: Light Point, Penang
Property Project Highlights Light Point, Penang
Slide 20: Property Project Highlights: Light Linear, Penang
Property Project Highlights Light Linear, Penang
Slide 21: Property Project Highlights: Raintree Park, India
Property Project Highlights Raintree Park Dwaraka Krishna, Vijayawada, India
Slide 22: Segmental Performance: Industry
Segmental Performance Industry RM’million FY2013 FY2012 %∆ Revenue 862.4 892.7 (3) Profit before tax 139.3 138.2 1 PBT % 16.2 15.5 Results Review • Topline for the quarter increased mainly due to higher local and export sales volume for concrete piles. Despite a pick-up in activity in the 2nd half,
Slide 23: Industry Outlook
Segmental Performance Industry Outlook • Healthy order book, both in piles and aggregate markets • Well positioned to benefit from increasing infrastructure spending in Malaysia • China operations still facing some competition, performance in India turned to profitability
Slide 24: ICP Group Pile Factories & Quarries
ICP Group Pile Factories & Quarries Industry Thailand Jawi Factory Kuala Terengganu Junjung Quarry Factory Ipoh Factory Lumut Factory Kuantan Quarry Kuang Quarry Kapar Factory Klang Factory Labu Quarry Nilai Factory Kulai Quarry Senai Factory Ulu Choh Quarry
Slide 25: Industry Project Highlights: Second Penang Bridge
Industry Project Highlights ICP piles used at the Second Penang Bridge
Slide 26: Industry Project Highlights: Labu Quarry
Industry Project Highlights Labu Quarry, Negeri Sembilan
Slide 27: Industry Project Highlights: Islamabad, Pakistan
Industry Project Highlights Ready Mixed Trucks at Islamabad, Pakistan
Slide 28: Segmental Performance: Plantations
Segmental Performance Plantations RM’million FY2013 FY2012 %∆ Revenue 486.3 590.4 (18) Profit before tax 156.6 215.2 (27) PBT % 32.2 36.4 Average CPO price per tonne (RM) 2,620 3,049 FFB Yield Per Hectare (tonne) 26.5 26.4 OER % 20.7 20.6 Results Review • Topline and PBT for the year decreased prima
Slide 29: Plantations Outlook
Segmental Performance Plantations Outlook • Crop production growth in Malaysia is expected to be flat due to areas coming into full maturity being offset by replanting activities • Expansion of land bank in Indonesia progressing well. As at end-July, more than 28,000 ha planted • First mill in East
Slide 30: Plantation Operations in Malaysia: Sandakan Centre
Plantation Plantation Operations in Malaysia Quality, Training and Research Centre, Sandakan
Slide 31: Plantation Operations in Malaysia: Sg Sabang Jetty
Plantation Plantation Operations in Malaysia Jetty and Bunking Facilities in Sg Sabang, Sugut, Sabah
Slide 32: Plantation Indonesian Expansion
Plantation Indonesian Expansion
Slide 33: Segmental Performance: Infrastructure
Segmental Performance Infrastructure RM’million FY2013 FY2012 %∆ Revenue 682.4 668.3 2 Profit before tax 83.7 86.1 (3) Results Review • Full year revenue increased steadily from robust Port operations and strong traffic growth at our highways • PBT for the year decreased mainly due to our share of p
Slide 34: Infrastructure Outlook
Segmental Performance Infrastructure Outlook • Extension of Besraya Highway by 12.3km expected to be completed by 2H FY2014 • Kuantan port expected to see revenue growth from additional berth capacity of 600m in the short term and doubling of capacity from proposed NDWT in the long term
Slide 35: Infrastructure Project Highlights: Besraya Highway
Infrastructure Project Highlights Besraya Highway, Kuala Lumpur
Slide 36: Infrastructure Project Highlights: Kuantan Port
Infrastructure Project Highlights Unloading operations at Kuantan Port, Pahang
Slide 37: Infrastructure Project Highlights: Swarna Highway, India
Infrastructure Project Highlights Traffic control centre at Swarna Highway, India
Slide 38: Corporate Responsibility
iM Corporate Responsibility 38
Slide 39: IJM CR Pillars
Corporate Responsibility IJM CR Pillars
Slide 40: Corporate Responsibility: Marketplace
Corporate Responsibility Marketplace Directors and staff attending a seminar on Corporate Governance Quality, Training and Research Stakeholder Engagement at Industries R & D Centre Centre at IJM Plantation our plantations
Slide 41: Corporate Responsibility: Community
Corporate Responsibility Community Upgrading of a home in Johor Bahru Relay For Life 2012 , Penang Toll Division disaster Before and after school fencing upgrade to perimeter wall around SJK Tamil simulation exercise Saraswathy
Slide 42: Corporate Responsibility: Community
Corporate Responsibility Community IJMP Breast Health Awareness Caring for the elderly and special children
Slide 43: Corporate Responsibility: Community
Corporate Responsibility Community HSBC – Cobra 10s Rugby Angel Cup- International Rhythmic A development partner with Games organised by IJM Gymnastic Tournament Malaysian Cricket Association Sports Club
Slide 44: Corporate Responsibility: Workplace
Corporate Responsibility Workplace Health & safety of our employees are our primary concern Blood Donation Drives, Health Screening by National Kidney Foundation (NKF) Malaysia and Health Talks
Slide 45: Corporate Responsibility: Environment
Corporate Responsibility Environment Start at Home Recycling Campaigns Forest & Lake Preservation IJMP Borneo Bird Festival Learning about migratory birds at the Mud ball throwing for cleaner rivers annual Raptor Watch
Slide 46: IJM GIVE Day Out 2012
Corporate Responsibility IJM GIVE Day Out 2012 Cleaning of homes Over 100 groups & over 2500 participants Beach cleaning initiatives Locations nationwide and worldwide - India & China Activities related to community, sports and environment Upgrade of landscaping at school
Slide 47: Key Group Strategies: Short Term
Concluding Remarks Key Group Strategies 1) Continue domestic growth agenda • execution of existing order book & land bank to underpin earnings • focus on Malaysian Government projects modelled on PFI to Short build up order book and recurrent income Term 2) Ride opportunistic sector/market positives
Slide 48: Key Group Strategies: Long Term
Concluding Remarks Key Group Strategies 1) Continued Focus On Core Competencies • proven track record in execution 2) Strengthen Regional Presence • significant growth opportunities in Asean • continue to expand our addressable market via exports & direct Long investments Term 3) Grow Recurrent Inco
Slide 49: Concluding Remarks
Concluding Remarks • Positive outlook on the Malaysian market for earnings growth • Selective participation in overseas construction tenders • Investments in capacity expansions augur well for the Group • Diversity in earnings base to provide sustainable growth in shareholder value over the long ter
Slide 50: Questions & Answers
Questions & Answers Questions from
Slide 51: Q&A Strategy/Financials: India Construction Question
Questions & Answers Strategy/Financials Question 1 As stated on page 57 of the Annual Report under the Chairman’s Statement, the Construction Division’s profits were weighed down due to slower progress of its operations in India. Could the Board shed some light on this issue and what steps would be
Slide 52: Q&A Strategy/Financials: India Construction Reply
Questions & Answers Strategy/Financials Reply 1 As of 31 March 2013, IJM’s outstanding order book in India stood at RM118 million and consisted solely of the Vijayawada-Chilkaluripet Tollway project in Andra Pradesh. The construction progress was hindered due to several site challenges including spo
Slide 53: Q&A Strategy/Financials: Extraction Rates Question
Questions & Answers Strategy/Financials Question 2 On the Company’s plantation division output efficiency for FY2013 we noted a drop in extraction rates for CPO (from 45.4% to 45.2%) and PK (from 49.7% to 46.3%). Please elaborate on the reasons for the decline and the mitigating factors to overcome
Slide 54: Q&A Strategy/Financials: Extraction Rates Reply
Questions & Answers Strategy/Financials Reply 2 Average CPO extraction rates of our Plantation Division improved to 20.7% in FY2013 as compared to 20.6% last year, as detailed on page 76 of our Annual Report. The decline in extraction rates for crude palm kernel oil (“CPKO”) and palm kernel expeller
Slide 55: Q&A Strategy/Financials: Besraya Extension Question
Questions & Answers Strategy/Financials Question 3 Could the Board explain what would be the projected toll revenues and profits going forward arising from the construction of the Besraya Eastern extension and what was the reason for the deferment earlier and would there be any accompanying cost inc
Slide 56: Q&A Strategy/Financials: Besraya Extension Reply
Questions & Answers Strategy/Financials Reply 3 Toll revenues are expected to increase upon the commencement of tolling once construction of the Besraya Eastern Extension is completed in early- 2014. Profits, however, are expected to be adversely affected in the initial few years due to amortisation
Slide 57: Q&A Strategy/Financials: Rupee Question
Questions & Answers Strategy/Financials Question 4 The recent depressed value in Rupee is anticipated to place a dampening effect on the profit repatriation from the Company’s Indian toll road operations. What is being done to mitigate this situation?
Slide 58: Q&A Strategy/Financials: Rupee Reply
Questions & Answers Strategy/Financials Reply 4 Three of the Group’s toll concessions in India are currently still in early stages of tolling operations and are, as to be expected, facing immature traffic profiles and relatively high debt costs. The financing covenants permit repatriation of profits
Slide 59: Q&A Strategy/Financials: Kuantan Port Question
Questions & Answers Strategy/Financials Question 5 On Kuantan Port’s proposed expansion plan to upscale its operations through the building of a new deep water terminal, how much capex was spent to date and what would be the return on investment therefrom?
Slide 60: Q&A Strategy/Financials: Kuantan Port Reply
Questions & Answers Strategy/Financials Reply 5 The development of the New Deep Water Terminal (“NDWT”) at Kuantan Port has yet to be finalised and as such no significant capex has been incurred. We anticipate the construction cost of the NDWT to be approximately RM3 billion and the terms of the new
Slide 61: Q&A Corporate Governance: Sustainability Question
Questions & Answers Corporate Governance Question 1 It was stated on page79, that the Company has overall commitment towards nurturing sustainability for the Company’s plantation division. Please elaborate on the outcome of the initiatives that were taken in terms of KPI’s achieved such as the exten
Slide 62: Q&A Corporate Governance: Sustainability Reply
Questions & Answers Corporate Governance Reply 1 The Plantation division is audited and certified under the MPOB Code of Practices (CoP) annually covering its supply chain from nursery, estates, mills and kernel plant where criteria and indicators as KPIs has to be met. In this respect, the Division
Slide 63: Q&A Corporate Governance: Gender Diversity Question
Questions & Answers Corporate Governance Question 2 Gender Diversity Addressing and formalising the approach to gender diversity and actions taken to meet the target of 30% women directors and also to disclose it in the Annual Report.
Slide 64: Q&A Corporate Governance: Gender Diversity Reply
Questions & Answers Corporate Governance Reply 2 When appointing a Director, the Nomination and Remuneration Committee and the Board will evaluate and match the criteria of the candidate to the Board based on experience, skill, competency, knowledge and potential contribution, whilst gender will als
Slide 65: Thank You
To Continue Delivering… Thank You
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