2001 Performance Review 2001 Performance Review February 20, 2002 - - PowerPoint PPT Presentation

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2001 Performance Review 2001 Performance Review

February 20, 2002 February 20, 2002

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DISCLAIMER DISCLAIMER

This presentation is not an offer of securities for sale in the This presentation is not an offer of securities for sale in the United United States, securities may not be offered or sold in the United Stat States, securities may not be offered or sold in the United States es absent registration or an exemption from registration, and any p absent registration or an exemption from registration, and any public ublic

• ffering of securities to be made in the United States will be m
• ffering of securities to be made in the United States will be made

ade by means of a prospectus that may be obtained from the issuer an by means of a prospectus that may be obtained from the issuer and d that will contain detailed information about the company and that will contain detailed information about the company and management, as well as financial statements. management, as well as financial statements. “ “United States United States” ” means the United States of America, its territories and possessi means the United States of America, its territories and possessions,

• ns,

any state of the United States, and the District of Columbia. any state of the United States, and the District of Columbia.

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SCOPE SCOPE

2001 Results 2001 Results

• Financial Performance

Financial Performance

• Key Business Review

Key Business Review

• Outlook and Management Target

Outlook and Management Target

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2001 PERFORMANCE AT A GLANCE 2001 PERFORMANCE AT A GLANCE

PATMI PATMI $176m $176m Earnings growth over FY00 Earnings growth over FY00 51% 51% Earnings growth over FY00 excl. EI Earnings growth over FY00 excl. EI 30% 30% Key Business earnings growth over FY00 Key Business earnings growth over FY00 55% 55% ROE ROE 19% 19% Group Orderbook excl. long Group Orderbook excl. long-

• term contracts

term contracts $3.7bn $3.7bn

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GROUP PERFORMANCE GROUP PERFORMANCE

50 100 150 200

1998 1999 2000 2001

PATMI excl. EI PATMI excl. EI $m $m

• Av. CAGR 23%

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GROUP PERFORMANCE GROUP PERFORMANCE

6 12 16 12

10 20

1998 1999 2000 2001

ROE excl. EI (%) ROE excl. EI (%)

ROE target 12%

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M&As IN 2001 M&As IN 2001

Building the SembCorp Industries of tomorrow Building the SembCorp Industries of tomorrow

• E

Expertise in up xpertise in up-

• stream process

stream process engineering engineering

• Extend use of land

Extend use of land reclamation reclamation technology technology

• Acquired Simon

Acquired Simon-

• Carves

Carves

• Invested in 40% stake of

Invested in 40% stake of HydraMac HydraMac E&C E&C

• First mover advantage

First mover advantage in Vietnam in Vietnam

• Entry into China

Entry into China’ ’s s power market power market

• SembCogen

SembCogen now a now a 70% 70%-

• owned
• wned

subsidiary subsidiary

• Phu

Phu My 3 Power Plant My 3 Power Plant (Vietnam) (Vietnam)

• Qianan SembCorp

Qianan SembCorp Cogeneration Co. (China) Cogeneration Co. (China)

• Additional 20% stake in

Additional 20% stake in SembCogen SembCogen Utilities Utilities The Result The Result M&A Activity M&A Activity SBU SBU

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M&As IN 2001 M&As IN 2001

• Entry into Malaysian supply

Entry into Malaysian supply chain management market chain management market

• Exclusive global use of

Exclusive global use of patented intermediate bulk patented intermediate bulk containers containers

• Entry into supply chain

Entry into supply chain management in Australia & management in Australia & New Zealand New Zealand

• Entry into wine logistics

Entry into wine logistics

• SembCorp

SembCorp Logistics Logistics (Malaysia) (Malaysia)

• Partnership with Goodpack

Partnership with Goodpack

• SembCorp Logistics

SembCorp Logistics (Australia) (Australia)

• JV with Zenecon

JV with Zenecon Logistics Logistics

• Now have 100% of medical

Now have 100% of medical waste market share and 28% waste market share and 28%

• f ICW market
• f ICW market
• Future revenue stream from

Future revenue stream from post post-

• processing plant

processing plant

• Acquired 40% stake in

Acquired 40% stake in SembSITA SembSITA

• Invested in 60% stake of

Invested in 60% stake of SembVISY SembVISY Recycling Recycling Environmental Environmental Engineering Engineering

The Result The Result M&A Activity M&A Activity SBU SBU

Building the SembCorp Industries of tomorrow Building the SembCorp Industries of tomorrow

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M&As IN 2001 M&As IN 2001

• Boosted rig building

Boosted rig building capabilities capabilities

• Tap into offshore and

Tap into offshore and conversion markets in conversion markets in Gulf Gulf

• f Mexico and West Africa
• f Mexico and West Africa
• Expansion into growing

Expansion into growing Chinese market Chinese market

• PPL Shipyard

PPL Shipyard

• Mau

Mauà à Jurong Jurong

• Dalian Cosco Marine

Dalian Cosco Marine Engineering Co. Engineering Co. Marine Marine Engineering Engineering The Result The Result M&A Activity M&A Activity SBU SBU

Building the SembCorp Industries of tomorrow Building the SembCorp Industries of tomorrow Total investments committed since 2001: $250m Total investments committed since 2001: $250m

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DIVESTMENTS IN 2001 DIVESTMENTS IN 2001

Despite the poor economy, we made several divestments: Despite the poor economy, we made several divestments: $M $M Marine Services Business Marine Services Business 205.6 205.6 Other Divestments Other Divestments 48.9 48.9 Permasteelisa Pacific Holdings Permasteelisa Pacific Holdings 12.6 12.6 Singapore Singapore-

• Suzhou Industrial Holdings

Suzhou Industrial Holdings 9.8 9.8 Asia Internet Holding Asia Internet Holding 8.4 8.4 Indo Indo-

• Sembawang

Sembawang-

• Nippon Glass

Nippon Glass 8.1 8.1 APLS APLS-

• Bok Seng Logistics

Bok Seng Logistics 3.0 3.0 Wuxi Hitachi Maxell Wuxi Hitachi Maxell 3.0 3.0 Others Others 4.0 4.0 254.5 254.5 To date, over $1.3 billion of capital reallocated To date, over $1.3 billion of capital reallocated

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OUR MANAGEMENT OUR MANAGEMENT PHILOSOPHIES SINCE 1998 PHILOSOPHIES SINCE 1998

• Retain businesses with engineering

Retain businesses with engineering and technology content and technology content

• Regional leadership with global reach

Regional leadership with global reach – – No.1 or 2 in Asia (ex No.1 or 2 in Asia (ex-

• Japan), or exit

Japan), or exit the business the business

• Strong financial discipline: Net income,

Strong financial discipline: Net income, ROE > 12%, EVA enhancing ROE > 12%, EVA enhancing – – to give to give superior returns over industry peers superior returns over industry peers

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THREE YEARS ON THREE YEARS ON

• Focus achieved with 5 Key Businesses.

Focus achieved with 5 Key Businesses. Divestments unlocked $1.3bn in value Divestments unlocked $1.3bn in value

• Logistics and Marine in global league.

Logistics and Marine in global league. Utilities, E&C, EE strong in Asia (ex Utilities, E&C, EE strong in Asia (ex-

• Japan). M&A strategy bearing fruit

Japan). M&A strategy bearing fruit

• Consistent profit growth. ROE target

Consistent profit growth. ROE target

• exceeded. EVA down due to growth
• exceeded. EVA down due to growth

phase phase

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FINANCIAL REVIEW FINANCIAL REVIEW

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PROFIT & LOSS PROFIT & LOSS

$M $M FY01 FY01 FY00 FY00 % %

Turnover Turnover 3,225.2 3,225.2 2,894.9 2,894.9 11 11 Profit attributable to shareholders Profit attributable to shareholders 176.1 176.1 116.6 116.6 51 51 Profit attributable to shareholders Profit attributable to shareholders 151.6 151.6 116.4 116.4 30 30 (excluding exceptional items) (excluding exceptional items) Profit before tax Profit before tax 340.3 340.3 250.0 250.0 36 36 EBIT EBIT 335.4 335.4 299.6 299.6 12 12 EBITDA EBITDA 484.2 484.2 437.6 437.6 11 11

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CONTRIBUTION TO TURNOVER CONTRIBUTION TO TURNOVER (%) (%) – – by businesses by businesses

Marine Engrg Enviro Engrg Logistics Utilities E&C In Devt. & Corporate

FY01 FY01

19 19 17 15 26 4

Marine Engrg Enviro Engrg Logistics Utilities E&C In Devt. & Corporate

FY00 FY00

24 22 11 15 2 26

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CONTRIBUTION TO TURNOVER CONTRIBUTION TO TURNOVER (%) (%) – – by geographical areas by geographical areas

Others Europe Singapore Rest of Asia

FY01 FY01

Others Europe Singapore Rest of Asia

FY00 FY00

59 16 7 18 18 61 4 17

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EXCEPTIONAL ITEMS EXCEPTIONAL ITEMS

FY01 ($M) Gain / (loss) on disposals / dilution of interest in investments and business 111.7 Impairment of assets and investments (33.4) Others (35.5) Exceptional Items before tax and minority interest 42.8 Less: Tax and minority interest (18.3) Net Exceptional Items 24.5

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CONTRIBUTION TO PATMI CONTRIBUTION TO PATMI

$M $M FY01 FY01 FY00 FY00 % % Key Businesses Key Businesses Utilities Utilities 36.0 36.0 14.7 14.7 145 145 Engineering & Construction Engineering & Construction 5.6 5.6 2.2 2.2 155 155 Environmental Engineering Environmental Engineering 8.0 8.0 1.2 1.2 567 567 Logistics Logistics 55.9 55.9 34.2 34.2 63 63 Marine Engineering Marine Engineering 50.4 50.4 48.0 48.0 5 5 155.9 155.9 100.3 100.3 55 55 In Development & Corporate In Development & Corporate 20.2 20.2 16.3 16.3 24 24 TOTAL TOTAL 176.1 176.1 116.6 116.6 51 51

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CONTRIBUTION TO PATMI (%) CONTRIBUTION TO PATMI (%)

Enviro Engrg Utilities E&C Marine Engrg In Devt. & Corporate Logistics

FY01 FY01

Marine Engrg Logistics Utilities E&C Enviro Engrg In Devt. & Corporate

29 32 20 3 11 14 13 41 29 5 2 1

FY00 FY00

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FINANCIAL INDICATORS FINANCIAL INDICATORS

FY01 FY01 FY00 FY00 % % ROE (%) ROE (%) 18.7 18.7 11.5 11.5 63 63 ROE excl. EI (%) ROE excl. EI (%) 16.1 16.1 11.5 11.5 40 40 ROTA (%) ROTA (%) 5.9 5.9 4.7 4.7 26 26 EPS (cts per share) EPS (cts per share) 10.96 10.96 7.27 7.27 51 51 WACC (%) WACC (%) 8.2 8.2 9.0 9.0 (9) (9) EVA ($m) EVA ($m) (17.2) (17.2) (10.9) (10.9) (58) (58) CAPEX ($m) CAPEX ($m) 440 440 1,219 1,219 (64) (64)

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FINANCIAL INDICATORS FINANCIAL INDICATORS

Dec 31, 2001 Dec 31, 2001 Dec 31, 2000 Dec 31, 2000 % % NTA per share ($) NTA per share ($) 0.59 0.59 0.52 0.52 13 13 Net Gearing (times) Net Gearing (times) 1.3 1.3 1.1 1.1 18 18 Net Gearing (excluding PF*) Net Gearing (excluding PF*) 1.0 1.0 0.9 0.9 11 11 Interest Cover (times) Interest Cover (times) 5.4 5.4 5.1 5.1 6 6 * * PF

PF -

• Project Financing

Project Financing

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BALANCE SHEET BALANCE SHEET

$M $M Dec 31, 2001 Dec 31, 2001 Dec 31, 2000 Dec 31, 2000 % % Non Non-

• current assets

current assets 3,602.0 3,602.0 2,808.2 2,808.2 28 28 Current assets Current assets 2,604.2 2,604.2 2,580.3 2,580.3 1 1 Less: Current liabilities Less: Current liabilities (2,948.3) (2,948.3) (2,986.9) (2,986.9) (1) (1) 3,257.9 3,257.9 2,401.6 2,401.6 36 36 Term loan Term loan (1,386.4) (1,386.4) (858.5) (858.5) 61 61 Non Non-

• current liabilities

current liabilities (168.3) (168.3) (167.6) (167.6)

• 1,703.2

1,703.2 1,375.5 1,375.5 24 24 Share capital & reserves Share capital & reserves 1,031.5 1,031.5 847.8 847.8 22 22 Minority interests Minority interests 671.7 671.7 527.7 527.7 27 27 Capital Employed Capital Employed 1,703.2 1,703.2 1,375.5 1,375.5 24 24

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CASH FLOW STATEMENT CASH FLOW STATEMENT

$M $M FY01 FY01 FY00 FY00 Cash flow from: Cash flow from: Operating activities Operating activities

• before change in working capital

before change in working capital 404 404 405 405

• change in working capital

change in working capital (538) (538) (78) (78) (134) (134) 327 327 Investing activities Investing activities (59) (59) (878) (878) Financing activities Financing activities (63) (63) 600 600 Net (decrease)/increase in cash & Net (decrease)/increase in cash & (256) (256) 49 49 cash equivalents cash equivalents Cash & cash equivalents at Cash & cash equivalents at 658 658 609 609 start of year start of year Cash & cash equivalents at Dec 31 Cash & cash equivalents at Dec 31 402 402 658 658

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CAPEX CAPEX – – FY01 FY01

Total CAPEX for 2001 = $440m Total CAPEX for 2001 = $440m $M $M Major investment items Major investment items: : 170 170 Simon Simon-

• Carves

Carves 40 40 SembCorp Cogen SembCorp Cogen 22 22 Phu My 3 BOT Company Phu My 3 BOT Company 30 30 Qianan cogeneration plant Qianan cogeneration plant 11 11 PPL Shipyard PPL Shipyard 15 15 Mau Mauà à Jurong Jurong 22 22

• S. Daniels
• S. Daniels

27 27 Others Others 3 3 Major fixed asset items: Major fixed asset items: 270 270 Plant & Machinery Plant & Machinery 144 144 Capital WIP Capital WIP 84 84 Land & Buildings Land & Buildings 18 18 Marine Vessels Marine Vessels 23 23 Others Others 1 1

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DIVIDEND DIVIDEND

• The Board recommends a 12%

The Board recommends a 12%

• rdinary dividend (3.0 cents per
• rdinary dividend (3.0 cents per

share) for FY2001 share) for FY2001

• For FY2000, the dividend paid was

For FY2000, the dividend paid was 10% (2.5 cents per share) 10% (2.5 cents per share)

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FINANCIAL REVIEW FINANCIAL REVIEW BY BY KEY BUSINESSES KEY BUSINESSES

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UTILITIES UTILITIES

FY01 FY01 FY00 FY00 % % Turnover ($m) Turnover ($m) 549.5 549.5 308.1 308.1 78 78 PATMI PATMI ($m) ($m) 36.0 36.0 14.7 14.7 145 145 ROE (%) ROE (%) 16.3 16.3 7.4 7.4 120 120 EVA ($m) EVA ($m) 0.3 0.3 (3.1) (3.1) NM NM Net Gearing (times) Net Gearing (times) 2.8 2.8 0.7 0.7 300 300 Net Gearing (excluding PF*) Net Gearing (excluding PF*) 1.2 1.2

• NM

NM

* PF * PF -

• Project Financing

Project Financing

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FY01 FY01 FY00 FY00 % % Turnover ($m) Turnover ($m) 646.1 646.1 662.7 662.7 (3) (3) PATMI ($m) PATMI ($m) 5.6 5.6 2.2 2.2 155 155 PATMI excl. EI ($m) PATMI excl. EI ($m) 5.6 5.6 23.2 23.2 (76) (76) ROE (%) ROE (%) 7.6 7.6 4.7 4.7 62 62 ROE excl. EI (%) ROE excl. EI (%) 7.6 7.6 53.0 53.0 (86) (86) EVA ($m) EVA ($m) (11.8) (11.8) 14.3 14.3 NM NM Net Gearing (times) Net Gearing (times) 0.2 0.2 1.2 1.2 (83) (83)

ENGINEERING & CONSTRUCTION ENGINEERING & CONSTRUCTION

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FY01 FY01 FY00 FY00 % % Turnover ($m) Turnover ($m) 140.6 140.6 71.6 71.6 96 96 PATMI ($m) PATMI ($m) 8.0 8.0 1.2 1.2 567 567 ROE (%) ROE (%) 5.6 5.6 3.6 3.6 56 56 EVA ($m) EVA ($m) (11.8) (11.8) (6.6) (6.6) (79) (79) Net Gearing (times) Net Gearing (times)

• 3.0

3.0 NM NM

ENVIRONMENTAL ENGINEERING ENVIRONMENTAL ENGINEERING

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FY01 FY01 FY00 FY00 % % Turnover ($m) Turnover ($m) 473.0 473.0 448.3 448.3 6 6 PATMI ($m) PATMI ($m) 89.8 89.8 46.9 46.9 91 91 PATMI excl. EI ($m) PATMI excl. EI ($m) 62.9 62.9 46.6 46.6 35 35 ROE (%) ROE (%) 43.3 43.3 24.8 24.8 75 75 ROE excl. EI (%) ROE excl. EI (%) 30.3 30.3 24.7 24.7 23 23 EVA ($m) EVA ($m) (7.3) (7.3) 9.7 9.7 NM NM Net Gearing (times) Net Gearing (times) 0.4 0.4 1.9 1.9 (79) (79)

LOGISTICS LOGISTICS

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FY01 FY01 FY00 FY00 % % Turnover ($m) Turnover ($m) 854.5 854.5 763.0 763.0 12 12 PATMI ($m) PATMI ($m) 82.7 82.7 79.8 79.8 4 4 ROE (%) ROE (%) 9.4 9.4 9.6 9.6 (2) (2) EVA ($m) EVA ($m) (2.3) (2.3) (27.3) (27.3) 92 92 Net Gearing (times) Net Gearing (times)

• MARINE ENGINEERING

MARINE ENGINEERING

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SECTORAL REVIEW SECTORAL REVIEW

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5 10 15 20 25 30 35 40

1998 1999 2000 2001

UTILITIES UTILITIES

• Strong growth year

Strong growth year-

• on
• n-
• year

year

• Gross power generation capacity

Gross power generation capacity increased to 1669MW (China, increased to 1669MW (China, Vietnam, Australia, Singapore) Vietnam, Australia, Singapore)

• Integrated utilities, gas and power

Integrated utilities, gas and power generation provide long generation provide long-

• term

term baseload earnings baseload earnings

• SMOE order book at $500m

SMOE order book at $500m

1998 1998 -

• 2001

2001

PATMI PATMI $m $m

ROE target 12% 4% 8% 7% 16%

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Key Developments in 2001 Key Developments in 2001

• SembCorp Cogen commenced commercial operations in

SembCorp Cogen commenced commercial operations in September September

• SembCorp Power secured over 60 accounts and 300

SembCorp Power secured over 60 accounts and 300 MW MW -

• 20% share of contestable market

20% share of contestable market

• Acquired a 33.3% stake in Phu My 3 power plant in

Acquired a 33.3% stake in Phu My 3 power plant in Vietnam Vietnam

• HGIW capacity of 30,000m

HGIW capacity of 30,000m³ ³ per day sold out per day sold out

• SUT Sakra and SUT Seraya secured 22 new contracts

SUT Sakra and SUT Seraya secured 22 new contracts worth over $23m per year worth over $23m per year

UTILITIES UTILITIES

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Operating Environment Operating Environment

• Opportunities for integrated utilities in new chemical

Opportunities for integrated utilities in new chemical hubs in the Asia Pacific region eg. China, Australia hubs in the Asia Pacific region eg. China, Australia

• Opportunities from liberalisation of regional energy

Opportunities from liberalisation of regional energy markets markets

• Local energy market deregulation is expected to

Local energy market deregulation is expected to increase competition and put pressure on pool prices increase competition and put pressure on pool prices Outlook Outlook

• First full year of operations for SembCorp Cogen and

First full year of operations for SembCorp Cogen and SembCorp Power in 2002 SembCorp Power in 2002

• Singapore

Singapore’ ’s first 30 mgd desalination plant s first 30 mgd desalination plant -

• results of

results of bid expected in 4Q2002 bid expected in 4Q2002

• Genco bid expected 4Q2002/1H2003

Genco bid expected 4Q2002/1H2003

UTILITIES UTILITIES

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• 30
• 20
• 10

10 20 30 40 1998 1999 2000 2001

ENGINEERING & CONSTRUCTION ENGINEERING & CONSTRUCTION

1998 1998 -

• 2001

2001

PATMI $m

ROE target 12%

• Moved up value chain to process

Moved up value chain to process engineering engineering

• Expertise in deep tunneling,

Expertise in deep tunneling, transportation and land transportation and land reclamation reclamation

• Orderbook at $1.84bn (incl. fee

Orderbook at $1.84bn (incl. fee-

• based projects)

based projects)

• Book to bill 2.78

Book to bill 2.78

61% 5% 8%

• 31%

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Key Developments in 2001 Key Developments in 2001

• Secured more than $1.7bn worth of new projects in

Secured more than $1.7bn worth of new projects in FY01 FY01

• Acquired Simon

Acquired Simon-

• Carves for upstream engineering

Carves for upstream engineering capabilities in oil & gas, petrochemical, chemical, capabilities in oil & gas, petrochemical, chemical, pharmaceutical and nuclear sectors pharmaceutical and nuclear sectors

• Secured first land reclamation project using the

Secured first land reclamation project using the “ “BulClaimer BulClaimer” ” technology technology

ENGINEERING & CONSTRUCTION ENGINEERING & CONSTRUCTION

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Operating Environment Operating Environment

• Total construction demand in Singapore contracted

Total construction demand in Singapore contracted 40% last year 40% last year

• Regional construction market has been badly affected

Regional construction market has been badly affected since 1997 due to lack of investments into the region since 1997 due to lack of investments into the region Outlook Outlook

• Construction industry will remain weak this year

Construction industry will remain weak this year

• Opportunities in oil and gas processing projects in

Opportunities in oil and gas processing projects in Vietnam and Indonesia Vietnam and Indonesia

• Our strong order book will underpin earnings for next

Our strong order book will underpin earnings for next 2 2-

• 3 years

3 years

ENGINEERING & CONSTRUCTION ENGINEERING & CONSTRUCTION

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• 2

2 4 6 8 1998 1999 2000 2001

• Streamline business

Streamline business processes processes

• Build two revenue streams:

Build two revenue streams: – – materials recovery and materials recovery and incineration incineration

• Regional expansion in the

Regional expansion in the mid mid-

• term

term -

• focus on countries

focus on countries

• r cities with $10K per capita
• r cities with $10K per capita

GDP, start with municipal GDP, start with municipal waste then move into ICW waste then move into ICW and specialised waste and specialised waste

ENVIRONMENTAL ENGINEERING ENVIRONMENTAL ENGINEERING

1998 1998 -

• 2001

2001

PATMI $m

ROE target 12%

4% 6%

• 7%

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ENVIRONMENTAL ENGINEERING ENVIRONMENTAL ENGINEERING

Key Developments in 2001 Key Developments in 2001

• Semac

Semac’ ’s refuse collection contracts for five municipal sectors s refuse collection contracts for five municipal sectors amount to >$400m revenue over 5 years amount to >$400m revenue over 5 years

• Re

Re-

• engineering at Semac produced savings of $4m for 2001

engineering at Semac produced savings of $4m for 2001 – – cut vehicle excess capacity from 40% to 10% cut vehicle excess capacity from 40% to 10% – – outsourced all fleet maintenance

• utsourced all fleet maintenance

– – cut workforce by about 27% cut workforce by about 27%

• SembWaste clinched first bundled contract from 5 major

SembWaste clinched first bundled contract from 5 major hospitals for waste management services hospitals for waste management services

• SembWaste formed JV company with VISY Recycling to

SembWaste formed JV company with VISY Recycling to build Asia build Asia’ ’s first automated Materials Recovery Facility s first automated Materials Recovery Facility

• SembSITA (Australia) won an A$151m, 8

SembSITA (Australia) won an A$151m, 8-

• year domestic

year domestic waste contract in Brisbane, Australia waste contract in Brisbane, Australia

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Operating Environment Operating Environment

• Decline in municipal waste tonnage due to economic

Decline in municipal waste tonnage due to economic downturn cuts disposal costs, gives improved margins downturn cuts disposal costs, gives improved margins

• Industrial and commercial waste sector also affected by

Industrial and commercial waste sector also affected by economic slowdown economic slowdown

• Increasing emphasis on waste minimisation and recycling in

Increasing emphasis on waste minimisation and recycling in Singapore Singapore Outlook Outlook

• Re

Re-

• engineering will continue

engineering will continue

• First Materials Recovery Facility to be in operation by end

First Materials Recovery Facility to be in operation by end-

• 2002

2002

• Increase ICW market share over our present 20%

Increase ICW market share over our present 20%

• Two more sectors (Bedok and Tampines) up for bid in 2003

Two more sectors (Bedok and Tampines) up for bid in 2003

ENVIRONMENTAL ENGINEERING ENVIRONMENTAL ENGINEERING

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• 90
• 70
• 50
• 30
• 10

10 30 50 70 90 1998 1999 2000 2001

LOGISTICS LOGISTICS

ROE target 12%

• Global platform

Global platform established with KNI and established with KNI and USCO USCO

• Pan

Pan-

• Asian network

Asian network expansion to fuel future expansion to fuel future growth growth

• Now leading SCM service

Now leading SCM service provider in Asia with 10m provider in Asia with 10m sq ft of warehouse space sq ft of warehouse space in 100 locations in 100 locations

1998 1998 -

• 2001

2001

PATMI $m

7% 25% 43%

• 18%

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Key Developments in 2001 Key Developments in 2001

• Divested marine business for $206m

Divested marine business for $206m

• KNI

KNI’ ’s acquisition of US s acquisition of US-

• based USCO completes our

based USCO completes our global SCM platform global SCM platform

• Pan

Pan-

• Asian network expanded to Australia and

Asian network expanded to Australia and Malaysia Malaysia

• Acquired 3% stake in Goodpack and reserves global

Acquired 3% stake in Goodpack and reserves global exclusive use of patented exclusive use of patented-

• IBCs

IBCs

LOGISTICS LOGISTICS

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Operating Environment Operating Environment

• Global consolidation will result in 10

Global consolidation will result in 10 -

• 15 major players

15 major players

• Outsourcing by companies still on uptrend

Outsourcing by companies still on uptrend

• China

China’ ’s GDP growth will fuel domestic consumption and s GDP growth will fuel domestic consumption and logistics demand and its entry into WTO will spur export logistics demand and its entry into WTO will spur export growth growth

• China and India still showing strong growth especially in

China and India still showing strong growth especially in FMCG, pharmaceuticals and chemicals FMCG, pharmaceuticals and chemicals Outlook Outlook

• China and India economies expected to enjoy good growth

China and India economies expected to enjoy good growth

• New revenue streams from network expansion,

New revenue streams from network expansion, concentrate on Japan market entry concentrate on Japan market entry

• Emerging Lead Logistics Provider (LLP) concept

Emerging Lead Logistics Provider (LLP) concept

LOGISTICS LOGISTICS

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10 20 30 40 50 60 70 80 90

1998 1999 2000 2001

MARINE ENGINEERING MARINE ENGINEERING

1998 1998 -

• 2001

2001

PATMI $m

• Steady reliable earnings

Steady reliable earnings

• Global hub strategy will

Global hub strategy will strengthen future earnings strengthen future earnings

• Orderbook (excl. shiprepair) at

Orderbook (excl. shiprepair) at $1.4bn $1.4bn

ROE target 12% 9% 10% 10% 9%

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Key Developments in 2001 Key Developments in 2001

• Execution of Global Hub Strategy on track:

Execution of Global Hub Strategy on track: – – Mau Mauà à Jurong in Brazil and Dalian Cosco Marine in Jurong in Brazil and Dalian Cosco Marine in China China

• Acquired 50% stake in PPL to boost rig building

Acquired 50% stake in PPL to boost rig building capabilities capabilities

• Disposed entire interest in Neptune Associated Lines,

Disposed entire interest in Neptune Associated Lines, a ship owning and chartering company a ship owning and chartering company

• Mau

Mauà à Jurong secured first contract of $270m from Jurong secured first contract of $270m from Petrobas Petrobas

MARINE ENGINEERING MARINE ENGINEERING

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Operating Environment Operating Environment

• Shiprepair demand expected to be firm for the next 2 years

Shiprepair demand expected to be firm for the next 2 years

• Continuing competitive pressure from emerging low cost

Continuing competitive pressure from emerging low cost centres such as China and Vietnam centres such as China and Vietnam

• Ship conversion market very active with strong demand for

Ship conversion market very active with strong demand for floating production units floating production units

• Crude oil price to stabilise around US$16

Crude oil price to stabilise around US$16-

• 20bbl, a level that

20bbl, a level that should support global economic recovery should support global economic recovery Outlook Outlook

• Execution of global hub strategy will start bearing fruit with

Execution of global hub strategy will start bearing fruit with contribution from Brazil and China yard in 2002 contribution from Brazil and China yard in 2002

• First full year of contribution from PPL in 2002

First full year of contribution from PPL in 2002

• A healthy $1.4bn orderbook and $400m shiprepair bookings

A healthy $1.4bn orderbook and $400m shiprepair bookings will underpin performance will underpin performance

MARINE ENGINEERING MARINE ENGINEERING

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GROUP REVIEW GROUP REVIEW AND OUTLOOK AND OUTLOOK

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Shareholder Value

Growth through Growth through Strategic Strategic Alliances and Alliances and M&As M&As

Time Value Curve Value Curve

Pursuing value- creating growth

GROUP STRATEGY GROUP STRATEGY

We’re here

2000 Restructuring Restructuring & & Divestments Divestments Forming Forming Strategic Strategic Alliances Alliances

• Capital reallocated to:

Capital reallocated to: – – Utilities Utilities – – Logistics Logistics – – EE EE

• Leveraging on first

Leveraging on first mover advantage mover advantage

• Move to high value

Move to high value

50

Utilities Utilities

• Bid for PUB’s

30mgd desalination plant

• Regional power

player through M&As

• Bid for one of

the three local gencos

• Extend

integrated utilities beyond Singapore

• Expand demand

for natural gas through new applications eg. CNG Engineering & Engineering & Construction Construction

• Increase regional

business in pharmaceutical and oil & gas with Simon- Carves’ capabilities

• Continue M&As/

alliances to enhance core competencies

• Expand to new

markets in Europe and Middle East

• Focus on projects

with high engineering content Environmental Environmental Engineering Engineering

• Complete Asia’s

first automated MRF and build new revenue streams from recycling

• Stream line
• perations

process in Singapore

• Increase market

share in Australia

• Develop

regional business

• Widen service
• fferings - liquid

hazardous waste, biomass etc Logistics Logistics

• Expand network

into Japan, Taiwan and rest

• f Asia
• Seek M&A
• pportunities to

expand network in China

• Develop more

innovative

• solutions. eg.

RFID and cold- box

• Expand services

to other government departments in Singapore Marine Marine Engineering Engineering

• Execute global

hub in China and Middle East

• Expand Brazilian
• perations
• Focus on higher-

end ship repair

• Focus on
• ffshore rigs and

semi- submersibles

PRIORITIES FOR 2002/2003 PRIORITIES FOR 2002/2003

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MANAGEMENT TARGET MANAGEMENT TARGET -

• 2002

2002

This year: This year:-

• Utilities targets earnings growth of at least 50%

Utilities targets earnings growth of at least 50%

• E&C expecting to at least double earnings

E&C expecting to at least double earnings

• Environmental Engineering targets about 40% earnings

Environmental Engineering targets about 40% earnings growth growth

• Logistics is targeting earnings growth (excluding EI and

Logistics is targeting earnings growth (excluding EI and Goodwill) of 20% Goodwill) of 20%

• Marine expecting earnings growth in the high teens

Marine expecting earnings growth in the high teens

• Divestment programme to continue

Divestment programme to continue -

• about $800m in

about $800m in value still to be unlocked value still to be unlocked

• Group CAPEX expected to be around $400m

Group CAPEX expected to be around $400m

(These targets must be read and understood in conjunction with t (These targets must be read and understood in conjunction with the Disclaimer) he Disclaimer)

52

SembCorp Industries expects SembCorp Industries expects (barring unforeseen circumstances) (barring unforeseen circumstances) to grow earnings by at least 20%. to grow earnings by at least 20%.

(These targets must be read and understood in conjunction with t (These targets must be read and understood in conjunction with the Disclaimer) he Disclaimer)

MANAGEMENT TARGET MANAGEMENT TARGET -

• 2002

2002

53

APPENDIX APPENDIX

54

CONTRIBUTION TO TURNOVER CONTRIBUTION TO TURNOVER (excludes inter (excludes inter-

• segment turnover)

segment turnover)

$M $M FY01 FY01 FY00 FY00 % % Key Businesses Key Businesses Utilities Utilities 548.3 548.3 302.8 302.8 81 81 Engineering & Construction Engineering & Construction 618.5 618.5 632.9 632.9 (2) (2) Environmental Engineering Environmental Engineering 139.7 139.7 71.6 71.6 95 95 Logistics Logistics 469.2 469.2 444.7 444.7 6 6 Marine Engineering Marine Engineering 850.0 850.0 757.7 757.7 12 12 2,625.7 2,625.7 2,209.7 2,209.7 19 19 In Development & Corporate In Development & Corporate 599.5 599.5 685.2 685.2 (13) (13) TOTAL TOTAL 3,225.2 3,225.2 2,894.9 2,894.9 11 11

55

CONTRIBUTION TO TURNOVER CONTRIBUTION TO TURNOVER

• by geographical areas

by geographical areas

FY01 ($M) FY01 ($M) % % FY00 ($M) FY00 ($M) % % in % in % Singapore Singapore 1,915.2 1,915.2 59 59 1,766.9 1,766.9 61 61 (2) (2) Rest of Asia Rest of Asia 571.6 571.6 18 18 509.7 509.7 18 18

• Europe

Europe 528.2 528.2 16 16 485.9 485.9 17 17 (1) (1) Others Others 210.2 210.2 7 7 132.4 132.4 4 4 3 3 TOTAL TOTAL 3,225.2 3,225.2 100 100 2,894.9 2,894.9 100 100

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CONTRIBUTION TO PBT CONTRIBUTION TO PBT (after associates) (after associates)

$M $M FY01 FY01 FY00 FY00 % % Key Businesses Key Businesses Utilities Utilities 55.5 55.5 27.8 27.8 100 100 Engineering & Construction Engineering & Construction 7.0 7.0 15.7 15.7 (55) (55) Environmental Engineering Environmental Engineering 9.3 9.3 2.6 2.6 258 258 Logistics Logistics 135.7 135.7 65.4 65.4 107 107 Marine Engineering Marine Engineering 100.8 100.8 96.4 96.4 5 5 308.3 308.3 207.9 207.9 48 48 In Development & Corporate In Development & Corporate 32.0 32.0 42.1 42.1 (24) (24) TOTAL TOTAL 340.3 340.3 250.0 250.0 36 36

57

EXTERNAL BORROWINGS EXTERNAL BORROWINGS

Currencies Currencies Amount Amount ($M) ($M) Total S$M Total S$M As a % As a % ST ST LT LT Equivalent Equivalent

• f total
• f total

S$ S$ 897 897 1,326 1,326 2,223 2,223 85 85 US$ US$ 241 241 98 98 339 339 13 13 Others (RM, A$, Others (RM, A$, £ £) ) 13 13 33 33 46 46 2 2 Total Total 1,151 1,151 1,457 1,457 2,608 2,608 100 100

(Average interest rates for S$ and US$ were 4.47% and 5.72% p.a. (Average interest rates for S$ and US$ were 4.47% and 5.72% p.a. respectively.) respectively.)

58

NET BORROWINGS NET BORROWINGS

$M $M As at As at As at As at Dec 31, 2001 Dec 31, 2001 Jun 30, 2001 Jun 30, 2001 % % Short Short-

• term

term 1,151 1,151 929 929 24 24 Long Long-

• term

term 1,457 1,457 1,456 1,456

• Gross

Gross 2,608 2,608 2,385 2,385 9 9 Less Cash Less Cash (409) (409) (399) (399) 3 3 Net Net 2,199 2,199 1,986 1,986 11 11

59

GOODWILL & AMORTIZATION GOODWILL & AMORTIZATION

$M $M Goodwill Goodwill Amortization Amortization Charge Charge Acquisition of: Acquisition of:-

• Simon

Simon-

• Carves

Carves 36.8 36.8 1.1 1.1 SembCorp Cogen SembCorp Cogen 7.2 7.2 0.3 0.3

• S. Daniels
• S. Daniels

14.1 14.1 0.4 0.4 Additional Shares in JPL Industries Additional Shares in JPL Industries 17.1 17.1 1.5 1.5 Others Others 0.3 0.3

• 75.5

75.5 3.3 3.3

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UTILITIES UTILITIES

$M $M FY01 FY01 FY00 FY00 % % Turnover Turnover Oil & Gas Oil & Gas 201.0 201.0 164.9 164.9 22 22 Centralised Utilities Centralised Utilities 185.8 185.8 132.8 132.8 40 40 Chemical Feedstock Chemical Feedstock 10.0 10.0 10.4 10.4 (4) (4) Gas Gas

• NM

NM Power Generation Power Generation 108.4 108.4

• NM

NM Power Supply Power Supply 64.1 64.1

• NM

NM Head Office & others Head Office & others (19.8) (19.8)

• NM

NM Total Total 549.5 549.5 308.1 308.1 78 78 PATMI PATMI Oil & Gas Oil & Gas 16.3 16.3 10.2 10.2 60 60 Centralised Utilities Centralised Utilities 17.7 17.7 9.8 9.8 81 81 Chemical Feedstock Chemical Feedstock 2.0 2.0 1.5 1.5 33 33 Gas Gas 2.5 2.5 0.1 0.1 NM NM Power Generation Power Generation 5.6 5.6 (5.9) (5.9) NM NM Power Supply Power Supply 0.1 0.1

• NM

NM Head Office & others Head Office & others (8.2) (8.2) (1.0) (1.0) NM NM Total Total 36.0 36.0 14.7 14.7 145 145

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ENGINEERING & CONSTRUCTION ENGINEERING & CONSTRUCTION

$M $M FY01 FY01 FY00 FY00 % % Turnover mix Turnover mix Singapore Singapore 455.1 455.1 652.4 652.4 (30) (30) Rest of Asia Rest of Asia 75.9 75.9 10.3 10.3 637 637 Europe Europe 115.1 115.1

• NM

NM Total Total 646.1 646.1 662.7 662.7 (3) (3)

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ENGINEERING & CONSTRUCTION ENGINEERING & CONSTRUCTION

Order Book (incl. fee Order Book (incl. fee-

• based projects): $1.84bn

based projects): $1.84bn Major Projects (Singapore) Major Projects (Singapore) $m $m Client Client Kallang/ Paya Lebar Kallang/ Paya Lebar 257 257 LTA LTA Expressway (c422) Expressway (c422) Kallang/ Paya Lebar Kallang/ Paya Lebar 235 235 LTA LTA Expressway (c421) Expressway (c421) Tuas View Reclamation Tuas View Reclamation 198 198 JTC JTC Anhydride Plant Anhydride Plant 128 128 Continental Continental Plasticizer Plasticizer

63

ENGINEERING & CONSTRUCTION ENGINEERING & CONSTRUCTION

Major Projects Major Projects $m $m Client Client (Overseas) (Overseas) Simon Simon-

• Carves

Carves’ ’ Projects Projects 95 95 Various Various Alkyd Resin/ Latex Plant Alkyd Resin/ Latex Plant 49 49 Continental Continental Specialties Specialties (Guangzhou) (Guangzhou) GE Medical GE Medical 44 44 GE (Beijing) GE (Beijing) Peciko 3 Peciko 3rd

rd Train Gas

Train Gas 34 34 TOTAL (Indonesia) TOTAL (Indonesia) Treatment Plant Treatment Plant

64

LOGISTICS LOGISTICS

$M $M FY01 FY01 FY00 FY00 % % Turnover Turnover Supply Chain Mgt Supply Chain Mgt 380.5 380.5 313.9 313.9 21 21 Offshore Logistics Offshore Logistics 51.9 51.9 51.2 51.2 1 1 Marine Services Marine Services 40.6 40.6 83.2 83.2 (51) (51) Total Total 473.0 473.0 448.3 448.3 6 6 PATMI PATMI Supply Chain Mgt Supply Chain Mgt 53.9 53.9 28.4 28.4 90 90 Offshore Logistics Offshore Logistics 15.8 15.8 15.4 15.4 3 3 Corporate & Elimin Corporate & Elimin (14.3) (14.3) (14.5) (14.5) 1 1 Subtotal Subtotal 55.4 55.4 29.3 29.3 89 89 Marine Services & others Marine Services & others 9.9 9.9 17.3 17.3 (43) (43) Total (before EI and Total (before EI and 65.3 65.3 46.6 46.6 40 40 Non Non-

• recurring Item)

recurring Item) Non Non-

• recurring Item

recurring Item (2.4) (2.4)

• NM

NM EI EI 26.9 26.9 0.3 0.3 NM NM Total Total 89.8 89.8 46.9 46.9 91 91

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MARINE ENGINEERING MARINE ENGINEERING

$M $M FY01 FY01 FY00 FY00 % % Turnover mix Turnover mix Shiprepair Shiprepair 486 486 382 382 27 27 Shipbuilding Shipbuilding 104 104 84 84 24 24 Offshore Offshore 204 204 244 244 (16) (16) Others Others 60 60 53 53 13 13 Total Total 854 854 763 763 12 12

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IN DEVELOPMENT IN DEVELOPMENT CONTRIBUTION TO PATMI CONTRIBUTION TO PATMI

$M $M FY01 FY01 FY00 FY00 % % Food Processing & Distribution Food Processing & Distribution 20.4 20.4 17.1 17.1 19 19 Minting Minting 2.2 2.2 6.3 6.3 (65) (65) Industrial Parks Industrial Parks 7.7 7.7 9.5 9.5 (19) (19) Internet Service Provider Internet Service Provider (1.8) (1.8) (5.6) (5.6) 68 68 IT Services IT Services 3.5 3.5 4.3 4.3 (19) (19) Building Materials Building Materials

• (9.6)

(9.6) NM NM Travel & Retail Travel & Retail 1.6 1.6 (10.0) (10.0) NM NM Others * Others * (3.9) (3.9) 2.3 2.3 NM NM TOTAL TOTAL 29.7 29.7 14.3 14.3 108 108 * * Includes Heavy Infrastructure, Properties, Financial Services, H

Includes Heavy Infrastructure, Properties, Financial Services, Hotels & Resorts

• tels & Resorts

67

DISCLAIMER DISCLAIMER

This presentation contains certain statements that are not state This presentation contains certain statements that are not statements of historical fact, i.e. ments of historical fact, i.e. forward forward-

• looking statements. Investors can identify some of these stateme

looking statements. Investors can identify some of these statements by forward nts by forward-

• looking terms such as

looking terms such as ‘ ‘expect expect’ ’, , ‘ ‘believe believe’ ’, , ‘ ‘plan plan’ ’, , ‘ ‘intend intend’ ’, , ‘ ‘estimate estimate’ ’, , ‘ ‘anticipate anticipate’ ’, , ‘ ‘may may’ ’, , ‘ ‘will will’ ’, , ‘ ‘would would’ ’, and , and ‘ ‘could could’ ’ or similar words. However, you should note that these words are

• r similar words. However, you should note that these words are not

not the exclusive means of identifying forward the exclusive means of identifying forward-

• looking statements. These forward

looking statements. These forward-

• looking

looking statements are based on current expectations, projections and as statements are based on current expectations, projections and assumptions about future sumptions about future

• events. Although SembCorp Industries believes that these expect
• events. Although SembCorp Industries believes that these expectations, projections and

ations, projections and assumptions are reasonable, these forward assumptions are reasonable, these forward-

• looking statements are subject to the risks

looking statements are subject to the risks (whether known or unknown), uncertainties and assumptions about (whether known or unknown), uncertainties and assumptions about SembCorp Industries SembCorp Industries and its business operations. and its business operations. Some of the key factors that could cause such differences are, a Some of the key factors that could cause such differences are, among others, the general mong others, the general economic and business conditions in Singapore, the Asia economic and business conditions in Singapore, the Asia-

• Pacific region and elsewhere;

Pacific region and elsewhere; currency fluctuations between the Singapore dollar and other cur currency fluctuations between the Singapore dollar and other currencies; governmental, rencies; governmental, statutory, regulatory or administrative initiative affecting our statutory, regulatory or administrative initiative affecting our business; industry trends; business; industry trends; future levels and composition of our assets and liabilities; fut future levels and composition of our assets and liabilities; future profitability of our ure profitability of our

• perations; competition; changes in Singapore tax or similar law
• perations; competition; changes in Singapore tax or similar laws or regulations; changes

s or regulations; changes in, or the failure to comply with, governmental regulations, inc in, or the failure to comply with, governmental regulations, including exchange control luding exchange control regulations, if any. regulations, if any. Given these risks, uncertainties and assumptions, the forward Given these risks, uncertainties and assumptions, the forward-

• looking events referred to in

looking events referred to in this presentation may not occur and actual results may differ ma this presentation may not occur and actual results may differ materially from those terially from those expressly or impliedly anticipated in these forward expressly or impliedly anticipated in these forward-

• looking statements. Investors are

looking statements. Investors are advised not to place undue reliance on these forward advised not to place undue reliance on these forward-

• looking statements.

looking statements. Investors should assume that the information this presentation i Investors should assume that the information this presentation is accurate only as of the s accurate only as of the date it is issued. SembCorp Industries date it is issued. SembCorp Industries’ ’ business, financial condition, results of operations business, financial condition, results of operations and prospects may have changed since that date. SembCorp Indust and prospects may have changed since that date. SembCorp Industries has no obligation ries has no obligation to update or revise any forward to update or revise any forward-

• looking statement, whether as a result of new information,

looking statement, whether as a result of new information, future events or otherwise, except as required by law. future events or otherwise, except as required by law.

68