Ann Joo Resources Bhd. · MYX:ANNJOO
Ann Joo Resources Bhd — Q2 2021 Earnings Presentation
18 slides from Ann Joo Resources Bhd's earnings presentation, Aug 26, 2021
Slide 1: Analyst Briefing 2Q2021 Performance Review & Industry Outlook
ANALYST BRIEFING 2Q2021 PERFORMANCE REVIEW & INDUSTRY OUTLOOK Dato’ Lim Hong Thye Group Managing Director 26 August 2021
Slide 2: Key Market Dynamics in 2Q21
KEY MARKET DYNAMICS IN 2Q21 DOMESTIC MARKET INFLUENCED BY PROLONGED COVID-19 PANDEMIC • Imposition of MCO 3.0 in mid-May • Total lockdown since 1 Jun 21 with mandatory business closure for non-essential sectors IMPACT OF CHINA’S POLICIES ON STEEL PRICES • Strong fundamental demand from China’s pump-
Slide 3: Part 01 Performance Review
Part 01 PERFORMANCE REVIEW 3
Slide 4: Group Performance Highlights (2Q2021 vs 1Q2021)
GROUP PERFORMANCE HIGHLIGHTS (2Q2021 VS 1Q2021) HIGHER PROFIT DESPITE HIGHER PLANT SHUTDOWN COST DUE TO MCO 3.0 IN JUNE REVENUE PROFIT AFTER TAX NET ASSETS NET GEARING RM674M RM84M RM1,270M 0.67X (1Q21: RM577M) 13.7% (1Q21: RM1,182M) (1Q21: 0.78x) 16.9% PAT Margin: 12.42% 7.5% (1Q21: RM74M; 12.77%)
Slide 5: Group Profit & Loss
GROUP PROFIT & LOSS RM’Mil 2Q21 1Q21Quarterly Chg Results (%) 2Q20 Chg (%) Budget RMRevenue MIL 2Q21 1Q21 674.1 Chg576.7 (%) 2Q20 17% Chg (%) 345.9 Chg 95%(%) 2Q21 Revenue EBITDA 674.1 576.7 17% 345.9 95% 708.4 (5%) 121.3 103.1 18% (28.0) 533% EBITDA Margin 18.0% 17.9% -8.1% EBITDA 121.3 103.1 18% (
Slide 6: Group Cash Flow & Balance Sheet Highlights
GROUP CASH FLOW & BALANCE SHEET HIGHLIGHTS 2Q21 6M21 Key Current Assets & Liabilities Position (1 Apr - 30 Jun 2021) (1 Jan - 30 Jun 2021) (RM'mil) Operating Cash Flow RM 67.0 mil RM 3.4 mil Inventories Receivables Net Borrowings Payables - RM 27.4 mil + RM 116.2 mil Change in Inventory 1,373 1,373
Slide 7: Group Financial Performance
GROUP FINANCIAL PERFORMANCE REVENUE (RM’Mil) Pre-Tax Profit (RM’Mil) 2Q21 674 2Q21 100 1Q21 577 1Q21 82 4Q20 539 4Q20 10 3Q20 560 3Q20 3 2Q20 346 (52) 2Q20 2Q21 vs 1Q21 2Q21 vs 1Q21 ❑ Revenue ↑ by RM97 mil or 17% due to ↑ selling prices & ↑ export ❑ ↑ Pre-tax profit of RM100.2 mil in 2Q21 (vs 1Q21:
Slide 8: Group Performance Review – Statements of Financial Position
GROUP PERFORMANCE REVIEW – STATEMENTS OF FINANCIAL POSITION As at Variance % Net Borrowings & Gearing Level Statements of Financial 30.6.21 30.6.21 31.3.21 Net Borrowings Net Gearing Ratio Position vs 31.3.21 1,100 1.00 RM'000 RM'000 1,023 1,000 952 TOTAL ASSETS 2,441,847 2,485,946 (1.8%) 0.90 921 N
Slide 9: Part 02 Industry Overview
Part 02 INDUSTRY OVERVIEW 9
Slide 10: Industry Overview
INDUSTRY OVERVIEW ❑ Strong demand from China’s massive construction spending & Sep-Oct 21 ❑ China’s policies to curb construction peak period steel production and ❑ Key driver - stimulus packages & pump priming exports weighed on worldwide HEIGHTENED HIGHLY market direction and ❑ Recent price moveme
Slide 11: Steel Prices Influenced by China Factor
STEEL PRICES INFLUENCED BY CHINA FACTOR VOLATILE STEEL PRICES INFLUENCED BY CHINA’S POLICIES RM/MT MALAYSIA vs INTERNATIONAL STEEL PRICE (RM/MT) 4,800 Malaysia Rebar Price (RM/mt delivered) China Domestic Shanghai Rebar HRB400 * MS 146 standard ≈ HRB 500 @ RMB100- China Domestic Shanghai HRC 3.0mm 4
Slide 12: China Billet Price Remains at 5-Year High
CHINA BILLET PRICE REMAINS AT 5-YEAR HIGH As at 24 Aug 2021 RMB4,930/mt 12 (source : mysteel)
Slide 13: Key Raw Material Prices – Iron Ore & Scrap
KEY RAW MATERIAL PRICES – IRON ORE & SCRAP Iron Ore Price (Jan 20 – Aug 21) As at Scrap Price (Jan 20 – Aug 21) As at USD/MT 24 Aug 21 USD/MT 24 Aug 21 230 520 210 470 190 170 420 150 370 130 320 110 90 270 70 220 IODEX 62% Fe / North China import CFR Scrap HMS, East Asia Import CFR $/t Scrap HMS, T
Slide 14: Key Fuel Prices – Coking Coal & Coke
KEY FUEL PRICES – COKING COAL & COKE USD/MT Premium Hard Coking Coal (PHCC) & Met Coke Price As at 24 Aug 2021 550 (2020 - 2021) May 2021 Met Coke FOB China Coking Coal price USD540/MT rally amid global demand recovery Met Coke CFR India 450 USD451/MT PHCC CFR China Met Coke Price CSR 64/62 FOB Nort
Slide 15: Malaysia Export-Import vs China Export-Import
MALAYSIA EXPORT-IMPORT VS CHINA EXPORT-IMPORT 2021 E XPORT INCREASED ON CHINA’S MILLS PUSHING EXPORT MALAYSIA LONG PRODUCT EXPORT REMAINED HIGH > 1.5 MIL PRIOR TO THE ANNOUNCEMENTS OF EXPORT REBATE CANCELLATION MT, WHILE IMPORT STAYED AROUND 240K MT LEVEL IN 2021 ON 1 MAY & 1 AUG 2021 Malaysia Long
Slide 16: Part 03 Strategic Direction
Part 03 STRATEGIC DIRECTION 16
Slide 17: Strategic Direction: Optimise Financial Performance
STRATEGIC DIRECTION : OPTIMISE FINANCIAL PERFORMANCE AGGRESSIVE EXPORTS 1 Continue to actively export to China and other countries in the region, where infrastructure demand is supported by domestic pump priming PROACTIVE WORKING CAPITAL MANAGEMENT 2 Proactive inventory management and receivables co
Slide 18: Thank You
THANK YOU KEY STEEL INDUSTRY WEBSITES INCLUDE: 1. miti.gov.my 2. steelbb.com 3. mysteel.net 4. seaisi.org 5. worldsteel.org