Keppel Ltd. · SGX:BN4
Keppel — FY2016 Earnings Presentation
38 slides from Keppel's earnings presentation, Jan 26, 2017
Slide 1: Fourth Quarter and Full Year 2016 Financial Results
1/26/2017 Fourth Quarter and Full Year 2016 Financial Results 26 January 2017 1 Scope of Briefing Address by CEO Group Financial Highlights by CFO 2 1
Slide 2: Address by CEO: Macro Environment
1/26/2017 Address by CEO 3 Macro Environment Anti-globalisation OPEC-led Slow global growth sentiments production cuts Asia’s rising urbanisation Digitalisation of economies 4 2
Slide 3: Shaping the Future; Financial Performance
1/26/2017 Shaping the Future Keppel Corporation Keppel Land Keppel T&T expanded Keppel Infrastructure restructured asset completed its into e-commerce named preferred management businesses Selective Capital fulfillment with bidder for Singapore’s under Keppel Capital Reduction exercise Courex stake
Slide 4: Offshore & Marine
1/26/2017 FPSO conversion projects, Armada Olombendo & Karapan Armada Sterling III Offshore & Marine 7 Offshore & Marine Keppel O&M remained profitable in FY 2016 net profit FY 2016 amidst offshore downturn S$29m, down 94% yoy Net profit of S$29m, compared to S$482m yoy 482 Operating profit of S
Slide 5: Offshore & Marine Pursuing Opportunities
1/26/2017 Offshore & Marine Net orderbooki Secured ~S$500m worth of non-drilling contracts in FY 2016 S$3.7b as at end-Dec 2016 Delivered 21 projects in FY 2016 5.1 2 jackup deferrals in 4Q 2016 0.2 0.2 3.7 ~20 newbuilds and conversions slated 0.1 for delivery in FY 2017 2.7 0.1 S$b 2.3 Co
Slide 6: Property
1/26/2017 Launch of Empire City Phase 1, Ho Chi Minh City Property 11 Property Keppel Land recorded higher net profitii FY 2016 net profit of S$586m for FY 2016, up from S$620m, down 6% yoy S$564m yoy 661 Capital recycling for best risk-adjusted 620 returns in FY 2016 153 112 56 Announced 11 d
Slide 7: Property Portfolio
1/26/2017 Property Sold ~5,720 units in FY 2016, with total Home sales sales value of ~S$2.3b 5,720 Overall sales volume grew ~25% yoy, 20 bolstered by: 380 4,570 ~3,800 units sold in China, up ~16% 170 1,520 190 yoy 930 ~1,520 units sold in Vietnam, up Units ~63% yoy 3,800 3,280 Singapore
Slide 8: Infrastructure
1/26/2017 Doha North Sewage Treatment Works, Qatar Infrastructure 15 Infrastructure Energy & Environmental Infrastructure FY 2016 net profit S$99m, down 50% yoy Keppel Infrastructure’s core operations remain robust - net profitii of S$84m for 197 FY 2016 vs S$46m for FY 2015 10 39 Signed 25-year
Slide 9: Infrastructure Investments
1/26/2017 Infrastructure Data Centres Keppel Data Centres Holding acquired Frankfurt data centre with Alpha Data Centre Fund Divestment of 90% stake in Keppel DC Singapore 3 to Keppel DC REIT Keppel DC Singapore 4’s TOP and Phase 1 fit-out to complete in 1Q 2017 Keppel DC Frankfurt 1 Logistics
Slide 10: Investments
1/26/2017 Investments Keppel Capital recorded higher net FY 2016 net profit profit of S$64m for FY 2016, up from S$36m, down 81% yoy S$58m yoy Asset management platform made 185 steady progress 127 First acquisitions by Alpha Data Centre Fund in Frankfurt and S$m 36 AAMTF III in Tokyo 58 i 64
Slide 11: Multiple Income Streams; Group Financial Highlights by CFO
1/26/2017 Multiple Income Streams Net profit by income type Earnings underpinned by multi-business strategy and resilient operations S$1,525m Revaluations, divestments and reversal of prior impairments of S$270m, offset 515 , 34% by additional provisions for impairment S$784m of S$336m 377 , 25%
Slide 12: 4Q 2016 Financial Performance and Highlights
1/26/2017 4Q 2016 Financial Performance Net Profit 65% to S$143m EPS 65% to 7.9cts EVA from positive S$192m to negative S$179m 23 4Q 2016 Financial Highlights S$m 4Q 2016 4Q 2015 % Change Revenue 1,940 2,479 (22) EBITDA 168 393 (57) Operating Profit 98 331 (70) Profit Before Tax 206 574 (64) Net Pro
Slide 13: 4Q 2016 Revenue and Pre-tax Profit by Segments
1/26/2017 4Q 2016 Revenue by Segments S$m 4Q 2016 % 4Q 2015 % % Change Offshore & Marine 800 41 1,323 53 (40) Property 584 30 652 26 (10) Infrastructure 516 27 459 19 12 Investments 40 2 45 2 (11) Total 1,940 100 2,479 100 (22) 25 4Q 2016 Pre-tax Profit by Segments S$m 4Q 2016 % 4Q 2015 % % Change O
Slide 14: 4Q 2016 Net Profit by Segments; FY 2016 Financial Performance
1/26/2017 4Q 2016 Net Profit by Segments S$m 4Q 2016 % 4Q 2015 % % Change Offshore & Marine (138) (96) (60) (15) 130 Property 269 188 368 91 (27) Infrastructure 19 13 45 11 (58) Investments (7) (5) 52 13 NM Total 143 100 405 100 (65) 27 FY 2016 Financial Performance Net Profit 49% to S$784m EPS 49%
Slide 15: FY 2016 Financial Highlights and Revenue by Segments
1/26/2017 FY 2016 Financial Highlights S$m FY 2016 FY 2015 % Change Revenue 6,767 10,296 (34) EBITDA 1,032 1,761 (41) Operating Profit 795 1,514 (47) Profit Before Tax 1,055 1,997 (47) Net Profit 784 1,525 (49) EPS (cents) 43.2 84.0 (49) 29 FY 2016 Revenue by Segments S$m FY 2016 % FY 2015 % % Chang
Slide 16: FY 2016 Pre-tax and Net Profit by Segments
1/26/2017 FY 2016 Pre-tax Profit by Segments S$m FY 2016 % FY 2015 % % Change Offshore & Marine 90 8 699 35 (87) Property 759 72 848 43 (11) Infrastructure 123 12 243 12 (49) Investments 83 8 207 10 (60) Total 1,055 100 1,997 100 (47) 31 FY 2016 Net Profit by Segments S$m FY 2016 % FY 2015 % % Chang
Slide 17: Net Profit & EPS; ROE & Dividend
1/26/2017 Net Profit & EPS Net profit (S$m) EPS (Cents) 2,237 124.8 1,946 619 1,846 1,885 109.4 34.5 102.3 103.8 1,525 844 685 726 84.0 346 47.4 38.0 39.9 19.3 4Q: 4Q: 405 22.3 521 3Q: 29.1 457 414 3Q: 406 363 784 22.8 25.3 22.9 20.0 43.2 4Q: 4Q: 2Q: 143 7.9 3Q: 2Q: 384 347 406 397 19.2 22.3 3Q: 225
Slide 18: Free Cash Flow; Q&A
1/26/2017 Free Cash Flow FY 2016 FY 2015 S$m S$m Operating profit 795 1,514 Depreciation & other non-cash items 500 (162) 1,295 1,352 Working capital changes (643) (1,801) Interest & tax paid (322) (336) Net cash from/(used in) operating activities 330 (785) Investments & capex (214) (277) Divestmen
Slide 19: Additional Information: Revenue by Geography
1/26/2017 Additional Information 37 Revenue by Geography FY 2016 Total Overseas Singapore S$m Customers Customers % % Offshore & Marine 2,854 86 14 Property 2,035 56 44 Infrastructure 1,744 17 83 Investments 134 2 98 Total 6,767 58% of total revenue came from overseas customers 38 19
Slide 20: EBITDA by Segments; Capital/Gearing/ROE
1/26/2017 EBITDA by Segments S$m FY 2016 % FY 2015 % % Change Offshore & Marine 300 29 744 42 (60) Property 533 52 614 35 (13) Infrastructure 136 13 273 16 (50) Investments 63 6 130 7 (52) Total 1,032 100 1,761 100 (41) 39 Capital/Gearing/ROE S$m 31 Dec 2016 31 Dec 2015 Shareholders’ Funds 11,659 11
Slide 21: Offshore & Marine 4Q Financial Highlights
1/26/2017 OFFSHORE & MARINE 41 Financial Highlights – Offshore & Marine S$m 4Q 2016 4Q 2015 % Change Revenue 800 1,323 (40) EBITDA (68) 38 NM Operating Profit (117) (2) >500 Profit Before Tax (142) 21 NM Net Profit (138) (60) 130 42 21
Slide 22: Offshore & Marine Financial Highlights and Review
1/26/2017 Financial Highlights – Offshore & Marine S$m FY 2016 FY 2015 % Change Revenue 2,854 6,241 (54) EBITDA 300 744 (60) Operating Profit 135 597 (77) Profit Before Tax 90 699 (87) Net Profit 29 482 (94) 43 Offshore & Marine Review About S$500m contracts secured in FY 2016: 4 FPSO projects inv
Slide 23: Offshore & Marine Orderbook
1/26/2017 Offshore & Marine Orderbook Contract Value Gross Net Client S$m. S$m. For delivery in 2017 10 JUs/1 Semi/1 FLNG Conversion/1 FPSO Conversion/ Grupo R/TS Offshore/Fecon/Clearwater/ 2 FPSO Modules Fab. & Integration/1 FPSO Topsides Installation & Falcon Energy/Golar/Yinson/Petrobras/ Integra
Slide 24: Financial Highlights - Property
1/26/2017 Financial Highlights - Property S$m 4Q 2016 4Q 2015 % Change Revenue 584 652 (10) EBITDA 213 261 (18) Operating Profit 205 249 (18) Profit Before Tax 296 441 (33) Net Profit 269 368 (27) 47 Financial Highlights - Property S$m FY 2016 FY 2015 % Change Revenue 2,035 1,823 12 EBITDA 533 614 (
Slide 25: Sales Achieved - Overseas; Residential Landbank - Singapore
1/26/2017 Sales Achieved - Overseas Units Sold Sales Value Latest Avg. Key Projects Location in FY 2016 in FY 2016 Selling Price China (RMB’m) (RMB’psm) 8 Park Avenue 34 960 ~105,000 Shanghai Seasons Residences 266 1,144 ~46,000 Park Avenue Heights 390 879 ~18,800 Chengdu V City 1,842 1,459 ~9,200 C
Slide 26: Residential Landbank - China and Other Overseas
1/26/2017 Residential Landbank - China Total GFA Total Units Units Remaining Units Remaining Area For China Location Stake (sm) Units Launched Sold For Sale Sale (sm) 8 Park Avenue 99% 133,393 918 918 881 37 10,396 The Springdale 99.4% 328,792 2,596 2,596 2,595 1 189 Shanghai Seasons Residences 99.9
Slide 27: Residential Launch Readiness
1/26/2017 Residential Launch Readiness – China Units Ready to Launch Project Location 2017 2018 2019 8 Park Avenue 37 - - The Springdale 1 - - Shanghai Seasons Residences 178 - - Sheshan Riviera^ 57 55 52 Waterfront Residences Nantong 20 23 23 Park Avenue Heights 316 - - Hill Crest Villas^ - 24 36 C
Slide 28: Expected Completion for Launched and Upcoming Projects
1/26/2017 Expected Completion for Launched Projects Total Units Launched as Units Sold as at Units Remaining Expected Projects/Phases launched Units at end-Dec 2016 end-Dec 2016 as at end-Dec 2016 Completion China Waterfront Residences, Tianjin 180 127 121 59 2H17 Sheshan Riviera, Shanghai 112 47 3
Slide 29: Commercial Projects Overseas
1/26/2017 Commercial Projects Overseas Commercial Projects under Development GFA (sm) Development Cost(1) Completion China Beijing Commercial (51% stake) 104,800 RMB2.7b 2019 Park Avenue Central, Shanghai (99% stake) 115,900 RMB2.9b 2021 Seasons City, Tianjin (100% stake) 161,800 RMB2.6b 2019 (Ph 1)
Slide 30: Financial Highlights - Infrastructure
1/26/2017 Financial Highlights - Infrastructure S$m 4Q 2016 4Q 2015 % Change Revenue 516 459 12 EBITDA 39 47 (17) Operating Profit 27 39 (31) Profit Before Tax 28 60 (53) Net Profit 19 45 (58) 59 Financial Highlights - Infrastructure S$m FY 2016 FY 2015 % Change Revenue 1,744 2,037 (14) EBITDA 136 2
Slide 31: Investments: Financial Highlights 4Q
1/26/2017 INVESTMENTS 61 Financial Highlights - Investments S$m 4Q 2016 4Q 2015 % Change Revenue 40 45 (11) EBITDA (16) 47 NM Operating Profit (17) 45 NM Profit Before Tax 24 52 (54) Net Profit (7) 52 NM 62 31
Slide 32: Financial Highlights - Investments
1/26/2017 Financial Highlights - Investments S$m FY 2016 FY 2015 % Change Revenue 134 195 (31) EBITDA 63 130 (52) Operating Profit 61 128 (52) Profit Before Tax 83 207 (60) Net Profit 36 185 (81) 63 This release may contain forward-looking statements which are subject to risks and uncertainties that
Slide 33: CFO Address: 4Q 2016 Financial Performance
ADDRESS BY KEPPEL CORPORATION LIMITED’S CHIEF FINANCIAL OFFICER, CHAN HON CHEW AT THE FY2016 RESULTS PRESENTATION THURSDAY, 26 JANUARY 2017 1. Group Financial Highlights by CFO (Slide 22) 2. 4Q 2016 Financial Performance (Slide 23) Thank you, Chin Hua. A very good evening to all. I shall now take yo
Slide 34: CFO Address: 4Q 2016 Revenue by Segments
4. 4Q 2016 Revenue by Segments (Slide 25) Overall, the Group’s revenue was 22% lower than for the same quarter in 2015, driven largely by the 40% decline in the Offshore & Marine division as a result of lower volume of work, deferment of some projects and suspension of the Sete Brasil contracts. Pro
Slide 35: CFO Address: 4Q 2016 Net Profit by Segments
6. 4Q 2016 Net Profit by Segments (Slide 27) After tax and non-controlling interests, the Group’s net profit in the fourth quarter decreased by 65% or $262 million to $143 million as compared to the same period in 2015. Property division is the top contributor to the Group’s earnings, followed by In
Slide 36: CFO Address: FY 2016 Revenue by Segments
9. FY 2016 Revenue by Segments (Slide 30) Overall, the Group’s revenue of $6.8 billion was 34% lower compared to 2015, led mainly by the 54% decrease in Offshore & Marine division’s revenue resulting from lower volume of work, deferment of some projects and suspension of the Sete Brasil contracts. P
Slide 37: CFO Address: FY 2016 Pre-tax Profit by Segments (cont.)
10. FY 2016 Pre-tax Profit by Segments (Slide 31) (cont.) Investments division’s pre-tax profit decreased by 60% or $124 million due mainly to share of losses from KrisEnergy, lower share of profit from k1 Ventures, lower gain from sale of investments, and impairment of investment. This is partly of
Slide 38: CFO Address: Free Cash Flow
14. Free Cash Flow (Slide 35) In 2016, operational cash inflow was $1,295 million, a decrease of $57 million compared to $1,352 million in 2015. Outflow for working capital changes, interest and income taxes was $965 million, which is significantly less than the outflow of $2.1 billion in the prior