FY00 PERFORMANCE REVIEW March 1, 2001 HIGHLIGHTS SembCorp - - PowerPoint PPT Presentation

FY00 PERFORMANCE REVIEW

March 1, 2001

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HIGHLIGHTS

• SembCorp Industries’ PATMI grew 2% to $131m – slightly

better than our mid-year estimate

• Our strategy is to attain sustainable growth through:

(i) strategic alliances and overseas M&As:

» Logs completed its Europe link; now building the US link » E&C in advanced stage of negotiation with target companies » Marine in the process of acquiring yards in China, Brazil and Middle East

(ii) upcoming investments in Utilities, Power and Environmental Engineering facilities

• We are making a global documented offering of up to 185m

new ordinary shares via bookbuilding in March

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REPORTING STRUCTURE

SembCorp Industries

In Development SembCorp Engineers & Constructors (100%) SembCorp Utilities (100%) SembCorp Waste Management (100%) SembCorp Logistics (64.98%) SembCorp Marine (63.71%)

Pacific Internet SembCorp Park Holdings Singapore Food Industries Singapore Mint Others

Key Businesses

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SCOPE

• Financial Review
• Key Business Review & Outlook
• Moving SembCorp Industries Ahead
• Share Placement
• Management Priorities

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FINANCIAL REVIEW FINANCIAL REVIEW

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$M FY00 FY99 % Turnover 2,894.9 3,653.1 (21) PBT (before Assocs & JVs) 225.4 229.0 (2) Contribution from Assocs/JVs 39.6 31.9 24 PBT (after Assocs & JVs) 265.0 260.9 2 PATMI 131.0 128.2 2 EI 0.3 269.1 (100) Profit Attributable to Shareholders 131.3 397.3 (67)

PROFIT & LOSS PROFIT & LOSS

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$M FY00 FY99 % Share Capital 401.3 400.4 Reserves 435.6 768.0 (43) Share Capital & Reserves 836.9 1,168.4 (28) Minority Interests 508.2 659.7 (23) Interest of Preference Shareholders in a Subsidiary

• 397.6

NM 1,345.1 2,225.7 (40)

BALANCE SHEET ITEMS BALANCE SHEET ITEMS

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$M FY00 FY99 % Key Businesses Utilities 302.8 234.7 29 Engineering & Construction 632.9 885.6 (29) Environmental Engineering 71.6 0.5 NM Logistics 444.7 432.3 3 Marine Engineering 757.7 917.3 (17) 2,209.7 2,470.4 (11) In Development Industrial Parks 43.3 8.3 NM Food Processing & Distribution 350.2 315.4 11 Minting 34.3 32.4 6 Internet Service Provider

• 28.7

NM

CONTRIBUTION TO TURNOVER

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$M FY00 FY99 % In Development (con’t) IT Services 93.4 418.7 (78) Building Materials 108.6 135.5 (20) Heavy Infrastructure

• Properties, Financial Services,

Hotels & Resorts 43.0 82.0 (48) Food Retailing

• 112.8

NM Travel & Retail 3.1 46.6 (93) 675.9 1,180.4 (43) Corporate & Others 9.3 2.3 NM TOTAL 2,894.9 3,653.1 (21)

CONTRIBUTION TO TURNOVER

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CONTRIBUTION TO TURNOVER (%) - by businesses

Marine Engrg Enviro Engrg Logistics Utilities E&C Corp & Others In Devt

FY00 FY00 FY99 FY99

23 22 10 15 26 3 0.3 0.06

Marine Engrg Enviro Engrg Logistics Utilities E&C Corp & Others In Devt

32 24 12 6 25 0.01 0.06

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FY00 ($M) % FY99 ($M) % in % Singapore 2,508.4 87 3,251.0 89 (2) Outside Singapore 386.5 13 402.1 11 2 TOTAL 2,894.9 100 3,653.1 100

CONTRIBUTION TO TURNOVER

• by country of incorporation

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FY00 ($M) % FY99 ($M) % in % Singapore 1,644.8 57 2,229.7 61 (4) Overseas 1,250.1 43 1,423.4 39 4 TOTAL 2,894.9 100 3,653.1 100

CONTRIBUTION TO TURNOVER

• by geographical areas

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$M FY00 FY99 % Key Businesses Utilities 11.1 8.8 26 Engineering & Construction 31.0 25.1 24 Environmental Engineering 1.2 (0.1) NM Logistics 34.0 25.5 33 Marine Engineering 44.4 46.1 (4) 121.7 105.4 15 In Development Industrial Parks 8.4 4.8 75 Food Processing & Distribution 17.1 18.4 (7) Minting 5.0 3.4 47 Internet Service Provider (6.4) 4.0 NM

CONTRIBUTION TO PATMI

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$M FY00 FY99 % In Development (con’t) IT Services 4.8 9.7 (51) Building Materials (3.3) 2.3 NM Heavy Infrastructure 4.0 7.4 (46) Properties, Financial Services, Hotels & Resorts (0.2) 3.2 NM Food Retailing

• 4.6
• Travel & Retail

0.7 3.2 (78) 30.1 61.0 (51) Corporate & Others (20.8) (38.2) 46 TOTAL 131.0 128.2 2

CONTRIBUTION TO PATMI

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% FY00 FY99 Utilities 8 7 Engineering & Construction 24 20 Environmental Engineering 1

• Logistics

26 20 Marine Engineering 34 36 In Development 23 48 Corporate & Others (16) (31) 100 100

CONTRIBUTION TO PATMI (%)

• by businesses

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Gain/(Loss) on Disposals: $M

• SCS

179.3

• Premium on SembLog’s share issue

147.2

• Safe & Mansfield Travel

3.2

• Far East Biscuit

(5.6)

• SembLog’s divestment

(7.4)

• Others

(5.6) Sub-total 311.1 Write-backs:

• Sun Cruise

4.7

• Bungalow at La Salle Street

1.1

• Other provisions

8.7 Sub-total 14.5

EXTRAORDINARY ITEMS

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Provisions: $M

• Cathay International

(101.9)

• Wuxi Garden City Mall

(68.6)

• WSIP Loan

(48.3)

• Suzhou Township

(23.4)

• Permasteelisa

(21.0)

• Bintan Lagoon – Club loan

(16.9)

• PT AIB & Norfolk Mansion

(14.6)

• Hotels in China

(13.8)

• Theme Parks

(6.0)

• Others

(10.8) Sub-total (325.3) TOTAL 0.3

EXTRAORDINARY ITEMS

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$M FY00 FY99 *Cash & Cash equivalents at beginning of the year 609 541 Net increase in Cash 48 68 *Cash & Cash equivalents at end of the year 657 609 *Cash & cash equivalents comprise cash on hand, bank deposits, net of bank overdrafts.

CASH FLOW STATEMENT

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FY00 FY99 % ROE (%) 13.07 14.05 (7) ROTA (%) 4.66 4.56 2 EPS - before EI (cents) 8.09 7.91 2 EPS - after EI (cents) 8.10 24.85 (67) Interest Cover 4.01 4.09 (2) Net Gearing (times) 1.11 0.54 106 EVA ($m) (10.9) (51.0) 79 EVA ($m) 40.1 120.0 NM NTA per share ($) 0.51 0.71 (28) CAPEX ($m) 1,229.7 225.2 NM WACC (%) 9.0 9.3 (3)

FINANCIAL INDICATORS

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FY00 (%) Utilities 10.6 Engineering & Construction 50.7 Logistics 24.8 Environmental Engineering 3.6 Marine Engineering 9.5

ROE OF KEY BUSINESSES

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CAPEX - FY00

$M Key investment items

• Kuehne & Nagel

644

• SembSITA Pacific (PWM)

149

• Semac

101

• SembCorp Marine

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• SUT Sakra

28

• Kwinana

24 Key fixed asset items

• Marine Vessels

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• SUT Sakra

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• SUT Seraya

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EXTERNAL BORROWINGS (excluding SembCap)

Currencies Amount ($M) Total S$M As a % ST LT Equivalent of total S$ 983 856 1,839 84 US$ 243 40 283 13 Others (RM, A$, £) 34 22 56 3 Total 2,178 100 (Average interest rates for S$ and US$ were 5.50% and 5.59% p.a. respectively).

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NET BORROWINGS (excluding SembCap)

$M As at As at Dec 31, 2000 Jun 30, 2000 % Short-term 1,260.4 654.8 92 Long-term 917.9 938.1 (2) Gross 2,178.3 1,592.9 37 Less Cash (742.7) (622.2) 19 Net 1,435.6 970.7 48

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DIVIDEND

• The Board recommends a first and final

dividend of 10% (less tax of 24.5%)

• For FY99, the dividend declared was 10%

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KEY BUSINESS REVIEW KEY BUSINESS REVIEW & OUTLOOK & OUTLOOK

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UTILITIES

• $M

FY00 FY99 % Turnover 302.8 234.7 29 PATMI 11.1 8.8 26

• SembUtilities’ turnover improved due to full-year

consolidation of SUT Sakra’s revenue

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UTILITIES

• Key turnover contributors:

$M FY00 FY99 % SUT Sakra 131.5 9.1 NM Oil & Gas 167.0 214.7 (22)

• Key PATMI contributors:

$M FY00 FY99 % SUT Sakra 10.0 6.5 54 Oil & Gas 10.2 4.4 132

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UTILITIES

SUT Sakra

• Became an 80%-owned subsidiary since Oct 00
• No. of customers rose from 17 to 24 in FY00. Existing

customers’ demand for utilities has also risen Oil & Gas

• Largest projects realized in FY00:
• ANOA platform: $61m (completion: 83%)
• Malampaya platform: $52m (completion: 97%)
• Sincor downstream: $24m (fully completed)

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UTILITIES

• Contributions from SUT Seraya, SembCorp Gas

and SembCorp Cogen will start across FY01 as they begin operations this year

• Bidding for local genco is likely to commence in

2H01

• Oil & Gas current order book stands at $232m
• Other projects under development / feasibility study:

– 10 mgd desalination plant on Jurong Island (estimated investment $100m) – SUT Tembusu (estimated investment: $100m) – natural gas liquid plant (estimated expenditure: $150m)

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ENGINEERING AND CONSTRUCTION

• Breakdown of SembE&C’s turnover and PATMI:-

$M Turnover FY00 FY99 % Construction 442.0 687.7 (36) EPC 190.9 197.9 (4) TOTAL 632.9 885.6 (29) PATMI Construction 23.0 21.3 8 EPC 8.0 3.8 111 TOTAL 31.0 25.1 24

• Gross margin: 10%

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ENGINEERING AND CONSTRUCTION

• Largest projects realized in FY00:
• NUS hostel: $70m (completion: 96%)
• Sengkang LRT: $63m (completion: 66%)
• Changi MRT: $36m (completion: 61%)
• Specialty plasticizer plant: $41m (fully completed)
• Odour treatment for Bedok Sewage Treatment

Works: $21m (completion: 60%)

• Turnover mix: 90% local

10% overseas

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ENGINEERING AND CONSTRUCTION

• Current order book stands at $682m. Book-to-bill

ratio is 1.08

• Business conditions remain difficult with intense price

competition

• Actively seeking participation in regional

infrastructure development projects to enhance

• verseas revenue
• At advanced stage of discussion with 3 strategic

partners

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ENVIRONMENTAL ENGINEERING

• SembWM’s turnover increased significantly from

$0.5m to $71.6m due to acquisitions of Semac (4 months consolidation) and SembSITA

• Rise in PATMI to $1.2m was attributable to

contributions from Semac and SembSITA Pacific

• Turnover breakdown by businesses:

domestic waste collection – 76% industrial & commercial waste collection – 20% medical waste collection – 4%

• Of the 7 domestic waste collection zones tendered
• ut by Singapore’s Ministry of Environment, 5 were

secured by Semac

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ENVIRONMENTAL ENGINEERING

• Priority to re-engineer Semac and consolidate the

business operations of Semac, SembSITA & RDC for greater synergy and better profitability

• SembSITA Pacific to look at ‘tuck ins’ and move into

industrial / commercial waste and composting (food waste and sludge combined into fertilizer for Australia’s wine industry)

• Prepare to participate in the bidding for the 3 privatized

and one new-build incineration plants of Singapore’s Ministry of Environment. Likely to take place from 2002

• nwards

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LOGISTICS

• SembLog’s PATMI grew 34% to $46.8m on the back
• f a 2% increase in turnover to $448.3m
• All 3 divisions – supply chain management (top

contributor), offshore logistics and marine services – contributed to earnings growth.

• SembLog–KNI partnership has commenced joint

marketing efforts in Singapore, India, China, Australia and Thailand. Integration of their IT systems is now underway

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LOGISTICS

• Full integration of business operations with KNI
• Expand existing Asia-Pacific supply chain network

to cover Japan, Australia, Korea, Malaysia, Philippines and New Zealand

• Venture into US with KNI

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MARINE ENGINEERING

• SembMarine’s turnover fell 17.2% to $763.0m due to

lower contribution from shiprepair and deconsolidation

• f JTIC
• PATMI grew 2.3% to $80.2m as a result of exceptional

profits from divestment of JTIC shares and quoted investments and write-back of prior years’ tax over- provision

• Turnover breakdown by businesses:

shiprepair – 50%

• ffshore / ship conversion – 32%

shipbuilding – 11%

• thers – 7%

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MARINE ENGINEERING

• Healthy order book of close to $1b for shipbuilding,
• ffshore and ship conversion.
• Ship repair demand is expected to grow but prices

remain depressed due to higher costs and intense competition from lower cost centres

• Global Hub Strategy:

– currently conducting due diligence for Brazilian yard; completion expected in 1H01 – in negotiation to buy stakes in COSCO’s China yards – looking at acquiring a Middle-East yard

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THINGS DONE IN FY00

We have:

• built a strong Utilities component with SUTs, gas, power

generation and power supply

• created a base to grow our Environmental Engineering
• perations across Asia with SITA - now in dominant

positions in Australia and Singapore

• put Logistics’ Europe link in place
• positioned Marine to have a global presence spanning

the Middle East, China, South America and West Africa

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MOVING MOVING SEMBCORP INDUSTRIES SEMBCORP INDUSTRIES AHEAD AHEAD

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BUSINESS RISKS & EFFECTS

US Slowdown

• Short of a severe meltdown, our business structure has

counterweights in Utilities and Environmental Engineering to balance out weaknesses that could occur mostly in E&C Regional Political Risks

• No key operation exposed excessively to any one market
• r regional currency

Oil Price

• Not expected to have significant adverse impact. High

prices beneficial to some operations in SembCorp Industries Power Market Liberalization

• Presents us with opportunities not just in Singapore but in

the region

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MAJOR INVESTMENTS 2001- 2004

Time Frame

• Genco bid

2001 - 2002

• E&C acquisition / strategic alliance

2001 - 2002

• Logistics network expansion

2001 - 2002

• SUT Tembusu

2001 - 2004

• Water facilities

2002 - 2003

• Natural Gas Liquid facility

2002 - 2004

• Incinerator bid

2002 - 2004 CAPEX 2001 estimate: $800m 2002 estimate: $950m

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FINANCING PROGRAMME

• Objectives:

– to fund upcoming strategic investments in Utilities and E&C – to maintain a net gearing at around 1.0x

• Equity placement by a global documented offering of

up to 185m new ordinary shares representing a 12% increment in share base

• Placement price to be determined by bookbuilding

after an international roadshow

• Bookrunner:

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MANAGEMENT PRIORITIES

• Grow Utilities through investments in privatized

Gencos and new facilities

• Grow E&C through strategic alliances (UK, US &

Japan)

• Grow Environmental Engineering through

investments in incineration plants and profitable waste management operations

• Grow Logistics’ global coverage by venturing into US
• Grow Marine’s operations by having Brazil, China

and Middle East hubs in place

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EARNINGS STREAMS

European & US alliances / acquisitions Organic growth USA acquisition to complete global coverage Organic growth Hub strategy implementation / Industry consolidation Organic growth

All timings approximate and based on current operating scenarios

SUT Tembusu / Water projects Organic growth NGL Other acquisitions Organic growth Incinerators Australian tuck-ins Genco

2001 2001 2002 2002 2003 2003 2004 2004 2005 2005 Marine Engineering Logistics Utilities E&C Environmental Engineering

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PLEASE NOTE

The materials in these slides do not constitute an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registrations or an exemption from registration under the US Securities Act of 1933. This is not intended to be a public offering of the Company’s securities in the United States