Ayala Corporation Investor Presentation W a t e r August 2018 - PowerPoint PPT Presentation

Real Estate Infrastructure F i n a n c i a l S e r v i c e s Power Generation Industrial Telecom Technologies Ayala Corporation Investor Presentation W a t e r August 2018 Healthcare Education Social Commitment

Key Messages Ayala is well-positioned to capture sustained momentum amid Philippine economic growth With solid macroeconomic fundamentals in place, we believe Philippine expansion remains resilient amid a continuing weakness in the global economy Our portfolio of businesses is well-positioned to capture the sustained momentum in the domestic environment underpinned by the 10-point economic agenda of the Duterte administration Our core businesses remain upbeat as our power business begins to deliver a new source of growth We continue to expand our portfolio and are establishing new businesses in healthcare and education and are deepening our presence in industrial technologies to seize opportunities in these sectors Ayala has ample financial capacity to support portfolio movements and potential sizeable investments, with demonstrated flexibility to raise capital 2

Macroeconomic Overview With healthy fundamentals combined with a demographic sweet spot, the Philippines remains on a solid growth path GDP per capita has steadily grown on consumption, which is expected Opportunity to benefit from demographic dividend, the working-age to increase further due to the first package of the government’s tax population increases relative to the young and old by 2050 reform program GDP Per Capita ($) Household Consumption Growth Demographic Dividend BPO Revenues 155 +15% 39 25 +2% 3,022 23 22 7.0 101 0-14 6.3 2,947 5.8 18 5.6 5.6 25 16 15-24 34 2,880 13 2,852 63 25-54 19 2,768 37 >55 29 10 13 14 15 2016 2017 13 14 15 16 17 12 13 14 15 16 17E 2015 2050 However, more work remains, particularly in power and infrastructure 2018 should see continued growth , amid solid macro fundamentals and attracting further capital investments Infrastructure Spending Interest Rates GDP Growth Inflation Remittances As a % of GDP 7.2% 5.6% 4.1% 6.8% 4.0% 4.0% 6.1% 6.2% 5.9% 6.7% 3.5% 3.2% 3.0% 3.0% 3.0% 29.7 28.3 3.4% 3.3% 3.2% 27.3 25.4 6.9% 2.7% 2.7% 28.1 1.8% 2.0% 1.4% 7-8% 2018 Govt Target 12 13 14 15 16 17 18E 13 14 15 16 17 12 13 14 15 16 17 12 13 14 15 16 17 13 14 15 16 17 3 Source: Bank of the Philippine Islands, Bloomberg, U.S. Census Bureau

Business Overview We continue to be positive about our growth trajectory as we move closer to our 2020 goals Increasing our profitability by doubling our net Diversifying the portfolio by increasing income and improving return on common equity contributions of emerging businesses and expanding international businesses Net Income and Return on Common Equity Equity Earnings from Emerging and International Businesses 50.0 Contribution of Contribution of 2X Emerging International Businesses Businesses 20% 10% 30.3 16% 26.0 7% 22.3 12.4% 11.8% 5% 15% 13.2% 12.6% 12.1% 3% 2015 2016 2017 2018 2019 2020 2015 2016 2017 2020 2015 2016 2017 2020 4

Business Overview Amidst the Philippines’ economic growth, our unique portfolio of businesses provides various engines for growth and diversification Water Utilities Real Estate Financial Services Telecommunications 47.0%* 48.6* 31.0%* 51.6%* Leading and most diversified Pioneering financial institution Purveyor of the Filipino digital Regional player in water property developer in the and one of the most profitable lifestyle, supported by a robust infrastructure services and country with the largest banks in the country telecom infrastructure development landbank (approx. $8.5B market cap) (approx. $4.4B market cap) (approx. $1.1B market cap) (approx. $12B market cap) Industrial Technologies Power Infrastructure Social Infrastructure Strategic Investments 100%* 100%* 100%* 100%* 100%* 100%* Making Ayala’s strategic Investing in A fast-growing regional Industrial technologies Developing an Growing portfolio of investments and fulfilling educational institutions energy platform with investments focused on integrated key infrastructure to deliver affordable roles as an enabler by investments in electronics ecosystem focused projects and public- high quality education investing in complementary renewable and manufacturing, vehicle private-partnerships on affordable that improves conventional power businesses; and as a retail, and enabling (PPPs) in the medicine and access employability of assets and development, pathfinder by investing in technologies to healthcare students Philippines operations and retail emerging trends, and services supply capabilities innovative businesses. 5 *AC effective ownership as of May 2018

Real Estate Ayala Land is shaping a more balanced portfolio in terms of net income mix by location Continued expansion of large scale township Creating a balance between residential and leasing segments developments across the nation Increasing leasable space Income contribution by location Total landbank: ~10,285 hectares Gross leasable area in millions sqm. Established 45% Estates 54% 3X GLA 3.1 Growth Centers New Estates/ 1.8 1.8 55% 1.6 46% 1.4 Malls GLA Office GLA 0.8 1.0 1.0 0.7 1.5 2015 2016 2017 1H2018 2020 1Q2018 1H2018 2020-40 Growth Plan Net income (₱ billions) Predicated on continued growth Launched ₱88.8B worth of projects in 2017 2X 40.0 • GDP momentum • Stable rate environment/ 25.3 inflation • Positive mortgage lending environment Azuela Cove Evo City Parklinks Pasig Davao City Kawit, Cavite FY2017 2020 6

Financial Services BPI continues to focus on earnings stability through strategic lending and ramp up of fee-based businesses Amidst the intense competitive landscape and increasingly challenging regulatory Our goal is to optimize strategic lending environment, our core banking business continues to improve and to further improve earnings quality ▪ Net interest income Non-interest income Ramp-up in new technology investments aligned with the Bank’s digitization strategy for Growth, Resiliency, and Security -6.9% +11.5% 26.2 ▪ 11.8 Focus on stability of earnings from core 11.0 23.5 lending and fee-based businesses ₱ billions ₱ billions ▪ Created the Business Bank to focus on the needs of the SME segment ▪ Continued expansion of retail footprint by an 1H2017 1H2018 1H2017 1H2018 additional 30 new branches per year for the next 3 years Loans Deposits FY2017 1H2018 ▪ Broad-based increase in fee-based income to 7.2% +15.7% come from cross selling credit cards, cash NPL ratio 1.29% 1.80%* management as business growth moves down 1.5 1.4 to SMEs 1.2 1.1 Capital 12.74% 17.29% ₱ trillions ₱ trillions adequacy ratio Cost-to-income 54.3% 57.0% ratio 1H2017 1H2018 1H2017 1H2018 *Based on BSP Circular 941 effective Jan 2018 7

Telecommunications Globe continues to gain traction through highly targeted product offerings and successful capture of the digital lifestyle Revenues and market share increasing on the strength of subscriber-driven Globe’s customer -centric strategies are key in growth, supported by controlled costs resulting to faster EBITDA growth achieving continued growth for mobile and data Continuously building a portfolio of services and content Service Revenues EBITDA for its subscribers’ evolving digital lifestyle +9% +19% Entertainment Music Social Chat Shopping 68.2 32.5 62.9 27.3 39.7 33.1 Data 29.8 28.5 Non-Data Globe continues to invest in its data network to improve service delivery 1H2017 1H2018 1H2017 1H2018 Home Broadband Total Mobile Subscribers Subscribers +9% +22% Wireless 65.1 1.5 59.8 1.2 0.8 0.6 As part of its commitment to the National Telecommunications 62.7 57.3 Wired Prepaid Commission on the use of the LTE frequencies acquired from San Miguel, 0.7 0.6 it has deployed over 1,100 cell sites to utilize the LTE 700, LTE 1800 and Postpaid 2.5 2.4 LTE 2600 frequencies. For the first quarter of 2018, Globe has spent $127 million in capex, ~64% of which was related to data requirements. 1H2017 1H2018 1H2017 1H2018 8

Water Infrastructure MWC is holding steady in the core Metro Manila Concession, while ramping up its other domestic and regional operations Steady growth in the Manila Concession amidst arbitration challenges Continued ramp-up in non-Manila Businesses, both locally and internationally Manila Concession billed volume (in mcm) By customer By area type +3% +3% 250 Launch of Healthy Gia Lai Bulk Water 242 Family Mini Project, Vietnam 111 Platform 109 Domestic/ 193 188 Semi-Commercial Stake in East Water Stake in PT Sarana Tirta (Thailand) Ungaran (Indonesia) 139 133 Expansion 57 55 Commercial/ Industrial Gearing towards further international expansion: 1H2017 1H2018 1H2017 1H2018 Vietnam, Thailand, and Indonesia 9