2Q2016 Results - Opportunity Day 19 August 2016 1
Disclaimer: This presentation herein should be used for investor information only. It should not be used as an offer or invitation to purchase or sell BJCHI shares. Additionally, this presentation contains forward-looking statements and assumptions that are subject to risks and uncertainties. Investors or readers using this material need to be prudent when they make investment decisions. 2
Agenda Industry Outlook & Forward Strategies Project Progress 2Q2016 Results Backlog & Hi-Potential Projects Q&A 3
Key Focus Oil & Gas Industry Being key source of revenue in 2016 Successfully deliver Topside Modules (01B) as EPC Mining Industry None of Australian projects undertaken now due to slowdown but start to foresee the recovery in mining industry Still receive bidding inquiry form from several mining project owners Renewable Energy Industry Ample opportunities with the growing trend of using renewable energy sources 4
Global View Oil Price Movement “Underinvestment” will quickly deplete the future Brent Crude Oil availability of reserves and production 150 110.97 100 Dollar Per Barrel 45.35 50 The global upstream industry will need to spend a 27.59 0 minimum capex of about USD 3 trillion during 2016- 2020 to ensure its long-term sustainability World Energy Consumption More than 200 key crude and natural gas projects Total OECD Total Non-OECD are expected start operations by 2025 . 1,000 Quadrillion Btu 800 600 533 Brazil is expected to have the highest number of 491 451 413 375 400 311 299 offshore planned projects globally, followed by the 200 282 267 274 UK and the US. 254 261 242 238 0 2011 2012 2020F 2025F 2030F 2035F 2040F 5 Source: ICD-Research & upstreamonline Source: EIA (as of May 11, 2016)
Why LCCs Strategies..? How to maintain Business Environment On-going Investment Slower Pace of Forced to keep Global Economies their investment Search for Dip in Energy Prices cheaper options 6 Source: Petrobras
Australian Market – Market Outlook Consumption of most commodities was stronger than World Iron Ore Export expected in early 2016 , largely stemming from increased Australia Brazil The Rest of The World construction activity in China. 80 Million tons 90 104 115 413 Australia is expected to export increasingly Iron Ore by 14% 390 371 344 in 2017 from 2015. 874 818 767 717 India’s demand for commodities is likely becoming high. The country’s economic growth (7.7% in 2015) helped lift 2014 2015 2016F 2017F millions from poverty who will significantly be the key Source: Department of Industry driver for Commodities like coal and Iron ore. NO. OF PROJECTS 39 Coal In late June BHP Billiton announced plans to increase its Other Commodities budget to US$900 million largely on exploration activities. LNG, Oil and Gas 26 Infrastructure Iron ore Gold There were 127 projects at the Feasibility Stage and their 13 Copper 12 11 collective project value is estimated to be AUD 182 billion 10 Nickel actually increased 27 percent from AUD143 billion in early Lead, Zinc, Silver 6 4 3 2015 2 Uranium 1 7 Alumina
Brazilian Market - Petrobras Outlook Investment Categories The investment amounts were also focused Budget % (US$.Bil) largely on E&P , particularly in the pre-salt 80.0 81% Exploration and Production layer. Refining, Transportation and 10.9 11% Marketing The new Brent crude price is projected to be 45 5.4 5% Gas and Power US$/barrel under Petrobras’ s new business 2.1 2% Other Areas plan. 98.4 100% Total Source: BMP 2015-2019 Brazilian Oil Production Lifting cost reduced from US$ 10.4/boe to US$ 7.6/boe * 2.70 mbpd 2.22 In 2015, Petrobras reached positive free cash flow for the first time after 7 years. 2015 2020 8 *The barrel of oil equivalent (BOE)
Forward Strategies Well-Prepared among changes in business environment Be flexible to any industries not just in Oil & Gas (if having other opportunities like Mining, Infrastructure, Renewable Energy ) Enter into other regions such as and markets in the near future ( US and Asia) Aim to secure larger-scale projects 9
Forward Strategies (Cont’) Maintain and Improve Competitive Advantages Keep delivering on-time with competitive prices Continue building successful track record with major clients Be capable of being partially EPC Undertake and take lesson learn the pilot project (TUPI) Help BJCHI expand its full products and services Enhance its capability and more chances for securing large-scale projects with major and more well-known clients 10
Agenda Industry Outlook & Forward Strategies Project Progress 2Q2016 Results Backlog & Hi-Potential Projects Q&A 11
Project Progress No. Project Industry Nationality Status 1 Replicant FPSO Compression Oil & Gas Ongoing – to be Modules – TUPI Project Upstream completed in 2Q17 EPC-BJCHI 2 Petrobras P75/P77 FPSO Oil & Gas Ongoing – to be Modules – QGI Project Upstream completed in 4Q16 EPC-QGI Oil & Gas Inc. 12
TUPI BV Project Project in advanced stages of modularization for 02B 13
TUPI BV Progress - VDO 14
QGI Project (P75) 4 Modules being undertaken for QGI Project P75 P75 M09A P75 M01 P75 M09B P75 M15 15
QGI Project (P77) 4 Modules being undertaken for QGI Project P77 P77 M01 P77 M09A P77 M15 P77 M09B 16
QGI Project (P75/P77) 17
Agenda Industry Outlook & Forward Strategies Project Progress 2Q2016 Results Backlog & Hi-Potential Projects Q&A 18
2Q2016 Results 1H15 1H16 %HoH Description 2Q15 2Q16 %YoY 2,256 3,869 71% Total Revenue 853 1,766 107% 2,236 3,821 71% Contracted Revenue 737 1,720 133% 20 48 138% Other Income 116 46 -60% Other - FX Gain (Loss) 104 14 -87% -36 -6 -85% COGS -549 -1,499 173% -1,644 -3,169 93% SG&A -124 -71 -43% 228 160 -30% Earnings Before Taxes 179 191 7% 345 530 54% Tax Expense 1 0.3 -70% -4 0.5 -114% Net Income 180 192 7% 341 530 56% 26.5% 17.1% GPM 25.5% 12.8% 15.1% 13.7% NPM 21.1% 10.9% 19
Revenue Breakdown 2Q16 % Revenue Breakdown APLNG QGI TUPI 01-02B TUPI 03B CL / Roy Hill TSE Other Unit: mil.bt 2,500 2,117 126 1,766 2,000 60 1,508 306 1,500 27 293 1,581 1,000 853 935 148 90 1,134 118 500 497 465 410 54 0 1Q15 2Q15 1Q16 2Q16 20
Agenda Industry Outlook & Forward Strategies Project Progress 2Q2016 Results Backlog & Hi-Potential Projects Q&A 21
Backlog Backlog (End of 2Q2016) % Backlog Breakdown No. Project Remaining Value (mil.THB) 1 Petrobras P75/P77 515 2 TUPI (01B & 02B) 141 3 TUPI (03B) 2,437 Total 3,093 22
High Potential Projects No. Project Name Industry Location Scope of work Exp.Period 1 Bauxite Project Mining Australia Steel Work 2H16 2 Iron Ore Project Mining Australia Structural Steel and 2H16 Plate Work 3 Oil Storage Tank Oil Malaysia Steel Work 2H16 4 LNG Project Gas USA Modules 2H16 5 Ammonia Project Petrochemical USA Piping Spool 2H16 23
Agenda Industry Outlook & Forward Strategies Project Progress 2Q2016 Results Backlog & Hi-Potential Projects Q&A 24
NEW FORCE IN HEAVY INDUSTRIES To be a world- class integrated engineering, procurement, fabrication and modularization service provider BJC HEAVY INDUSTRIES PUBLIC COMPANY LIMITED Address : 594 Moo 4, Makhamkoo Sub-district, Nikompattana District , Rayong , Thailand Telephone : +66-(0)-3889-3709 - 10 Fax : +66-(0)-3889-3711 Website : www.bjc1994.com E-mail : ir@bjc1994.com 25
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