92 nd Annual General Meeting PRESENTATION TO SHAREHOLDERS | 28 Aug - - PowerPoint PPT Presentation

92nd Annual General Meeting

PRESENTATION TO SHAREHOLDERS | 28 Aug 2019

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• In the current financial year, the Group has adopted the MFRS Framework for the first time. The effects of the

adoption of MFRS had resulted in the reduction of the opening balance of retained profits by RM2.8m.

• Achieved a revenue of RM886.3m for financial year ended 31 March 2019, a decrease of RM96.4m or 9.8%.

The Property segment registered a decrease of RM81.1m and the Hospitality segment registered a decrease of RM14.5m.

• The profit before tax in the current financial year was dampened by the holding costs payable of RM44.6m in

Q3 FY19, in respect of the non-exercise of an option for the acquisition of a parcel of land. However in the absence of this one-off holding costs, the FY19 would have reflected a healthier profit before tax of RM206.5m with an increase of RM17.4m. * Restated due to adoption of MFRS

Group Result for FY 2019

Description FY 2019 RM’000 FY 2018 RM’000 Restated Variance RM'000 Revenue 886,320 982,706 (96,386) Operating profit 238,795 *261,825 (23,030) Finance costs (76,793) *(69,599) (7,194) Share of Joint Ventures (104) *(3,123) 3,019 Share of Associate

• (20)

20 Profit before tax 161,898 189,083 (27,185) Profit after tax 76,364 109,822 (33,458) PATAMI 61,918 *94,298 (32,380)

Adjusted PATAMI

Description FY 2019 RM’000 FY 2018 RM’000 Restated Variance RM’000

PATAMI 61,918 94,298 (32,380) Adjustments: Net loss from fair value adjustment of investment properties 3,922 28,329 (24,407) Net impairment loss on property, plant and equipment 6,966 20 6,946 Land held for property development written down 5,307 571 4,736 Property development costs written down 14,424

• 14,424

Holding costs payable 44,573

• 44,573

Net gain on disposal of subsidiary

• (24,493)

24,493 Adjusted PATAMI 137,110 98,725 38,385

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Description FY 2019 FY 2018 Variance Revenue RM’000 Revenue RM’000 Revenue RM’000 Property segment 798,927 880,008 (81,081) Hospitality 84,348 98,872 (14,524) Investment & Others 3,045 3,826 (781) Total 886,320 982,706 (96,386)

Segmental Results – Revenue

• The decrease in revenue in the property segment was due to lower revenue recognition for

reclaimed land in STP2A, lower sales of completed properties in STP1 and in Princes House, London.

• The decrease in revenue for hospitality segment was mainly due to lower occupancy rate; as

well as lower revenue recognised following the disposal of E&O Express Sdn. Bhd. (EOE), a subsidiary company which owned the Lone Pine Hotel. The disposal of EOE was completed in the previous financial year.

• Revenue from investments and others slid slightly in FY19, which was mainly due to a drop

in the property management fees income.

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Statement of Financial Position

• Cash and bank balances showed an increase of RM333.3m mainly from increased cash flow from
• perating activities of RM471.5m mitigated by net cash flows used in financing activities of

RM134.4m.

• Borrowings stand at RM1.413b, a decrease of RM237.2m.
• Shareholders’ funds increased by RM163.4m mainly due to the profit for the financial year

amounting to RM61.6m, issuance of new ordinary shares of RM127.6m in relation to the private placement and offset with share buy back of RM25.9m.

Description FY 2019 FY 2018 Variance RM’000 RM’000 Restated RM’000 (a) (b) (a)-(b) Total Assets 4,195,014 4,098,557 96,457 Cash and bank balances 854,833 521,568 333,265 Total borrowings 1,413,373 1,650,573 (237,200) Shareholders’ funds 2,007,574 1,844,162 163,412 Net Assets per share (RM) 1.40 1.42 (0.02) Gearing ratio:

• Gross

0.70

• 0. 90

0.20

• Net

0.28 0.61 0.33

E&O’s Sales & Unbilled Sales

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• Sales achieved of RM330.8m
• Unbilled sales RM61.3m will progressively be recognised over FY20
• RM152.5m remaining to be billed to KWAP for land sale (not included in above figures)

Sales FY 2019 RM 330.8m

Penang 63% Klang Valley 25% Johor 9% UK 3%

Unbilled Sales FY 2019 RM 61.3m

Penang 94% Klang Valley 6%

Reclassification of the term Inventories

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Assets (RM’000) FRS 111 MFRS 15

Non-Current Assets: Land held for property development 1,427,630 Non-Current Assets: Inventories 1,427,630 Current-Assets: Property development costs (PDC) 534,183 Current-Assets: Inventories 216,066 750,249

PDC 534,183 Completed Properties 214,785 Food, beverages & tobacco 351 General Supplies 930

FY 2019 Reclassification

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206,455 210,601 455,085 322,972 214,785 58,358

50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020

Completed Properties (at cost)

In RM’000

Projection

Monetising Completed Properties

Shareholders’ Returns

FYE 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Net Dividend per stock unit (sen)

2.9 1.5 3.2 3.4 3.0 * 2.0 3.0 * 3.0 ^

^ Proposed fist and final single-tier dividend of 3 sen per stock unit, to be approved at forthcoming AGM * Dividend via distribution of treasury stock units on the basis of one (1) stock unit for every fifty (50) existing ordinary stock units

Remains a trustee stock, maintaining continuous & consistent dividend payout since 2010

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STP2A UPDATE

Completed temporary bridge at Middle Bridge

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STP2A – Completed Walkway

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Plot 16

2A3 RECLAMATION AVERAGE AT +5 TO +6M CD

COMPLETED WALKWAY 1952M

BALANCE AREA OF WALKWAY

STP2A – Private Berth

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WALKWAY IN PROGRESS FOR PRIVATE BERTH 2

2A3 RECLAMATION AVERAGE AT +5 TO +6M CD

STP2A Island

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PLOT 16 (75 ACRES)

COMPLETED WALKWAY COMPLETED CAPPING BEAM

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Moving Forward

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Moving Forward….. The next 3 years

• Complete reclamation and infrastructure
• Commence to launch projects in 2020

Operationalise STP2A

• Lower net gearing and generate cashflow

Sell non-core assets

• Launch premier lifestyle projects in strategic

locations to enhance the E&O brand and positioning

Launch Conlay and The Peak

• Disciplined approach to monetise inventory which

are fully paid for and unencumbered to generate cashflow

Monetise inventory

• To progress further with preparatory works for

the reclamation of STP2B & STP2C

Start reclaiming STP2B & 2C

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Operationalise STP2A

Complete reclamation of STP2A in 2019

• 1. Progressively

complete infrastructure works by 2022

• 2. Launch STP2A

projects in 2020 To build an iconic destination in South East Asia to live, work, play and sail

• ver the next 15

years

The Conlay

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• Land size - 1.44 acres
• Net Saleable area – 450,000 sf
• GDV – RM896 million
• Launch in 4th quarter 2019

* Artist’s impression

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The Peak

• Land size - 3.94 acres
• Net Saleable area - 211,295 sf @ 54 units
• GDV – RM 280 million
• Launch in early 2020

* Artist’s impression

Conclusion

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Conclusion

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Property Development division remains core

• Fundamentals of E&O is remains unchanged
• Unbilled sales of RM61m as at 31 March 2019
• Unrecognised revenue from KWAP of RM405m as at 31 March 2019
• Inventory level successfully brought down to RM215m (RM416m at

market value) from a high of RM537m in Sept 2016

• Proposed launches in excess of RM1.5 billion worth of projects over next

two years will replenish unbilled sales

• Net gearing is 0.28x as at 31 March 2019 with cash hoard of RM855m
• Fund raising will further strengthen the balance sheet and is for gearing

up for future growth

Operationalising STP 2A is imminent

• Reclamation progressing well – STP2A island is 99% completed and

Gurney Wharf is 100% completed. Targeted handed over at end of 2019.

• Titles have been obtained for all of STP2A land
• Operationalising STP2A development is the next integral step
• Target first launch in second half of 2020

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End