Interim Results Announcem ent 14 August 20 14 20 14 - - PDF document
1 Interim Results Announcem ent 14 August 20 14 20 14 FORWARD-LOOKI NG STATEMENTS Certain statements contained in this presentation maybe viewed as forward-looking statements. Such forward- looking statements represent the Companys
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14 August 20 14
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FORWARD-LOOKI NG STATEMENTS
Certain statements contained in this presentation maybe viewed as forward-looking statements. Such forward- looking statements represent the Company’s expectations
and unknown risks and uncertainty that could cause actual results, performance or events to differ materially from those expressed or implied in such statements.
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Group turnover
HK$’M
18,935 22,094
15,000 30,000 1H2014 1H2013
+ 16.7%
1H14 vs 1H13 HK$’M 426 397
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400 800 1H2014 1H2013
Non-operating profit Adjusted net profit
401 430
+ 7.2%
1H14 vs 1H13
Profit attributable to shareholders
HK$’M
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For the period ended 30 June 2014
Note: * The adjusted net profit for the period excluding net gain on remeasurement of investment properties and other non-operating items.
HK$'M 1H2014 Turnover 22,094 18,935
+ 16.7%
Profit from operations 755 637
+ 18.5%
Operating margin 3.4% 3.4%
430 401
+ 7.2%
Adjusted net profit * 426 397
+ 7.3%
1H2013
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For the period ended 30 June 2014
1H2014 Basic earnings per share (HK cents) 23.47 21.91
+ 7.1%
I nterim dividend per share (HK cents) 9.30 8.68
+ 7.1%
NAV per share (HK$) 5.23 4.99
+ 4.8%
Return on equity (annualised) 9.5% 9.3%
+ 0.2% pt
Return on capital employed (annualised) 7.3% 6.7%
+ 0.6% pt
1H2013
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Motor & Motor Related 77.0% Food & Consumer Products 22.9% Others 0.1%
Note: * For sales to third parties only
1H2013
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1H2013
Note: * For sales to third parties only
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HK$'M 30 Jun 2014 31 Dec 2013 30 Jun 2013 Non-current assets 6,537 6,465 6,405 Current assets * 15,159 15,161 13,711 Current liabilities 9,070 10,194 8,459 Net current assets 6,089 4,967 5,252 Current ratio 1.67 1.49 1.62 Non-current liabilities 3,044 2,059 2,519 Net assets 9,582 9,373 9,138 Non-controlling interests 412 379 404 Shareholders' funds 9,170 8,994 8,734
* I ncluding I nventories
7,907 6,259 5,680
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HK$'M 30 Jun 2014 31 Dec 2013 30 Jun 2013
Cash and bank deposits 1,405 2,173 2,465 Total debt 7,382 7,424 6,008 Net debt 5,977 5,251 3,543 Shareholders' funds 9,170 8,994 8,734 Total capital 15,147 14,245 12,277 Net gearing ratio 39.5% 36.9% 28.9%
12 HK$'M 1H2014 1H2013 Profit before taxation 612 554 Depreciation, Amortisation & other non-cash items 409 328 Operating profit before changes in working capital 1,021 882 I ncrease in working capital (1,100) (306) Cash (used in) / generated from operations (79) 576 I ncome tax paid (61) (201) Net cash (used in) / generated from operating activities (140) 375 (196) (162) Net cash used in other financing activities (226) (519) (179) (445) (741) (751) Dividends paid to shareholders of the Company Net cash used in investing activities Net decrease in cash and cash equivalents
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14 HK$’M
646 567
1H2014 1H2013
Segment Result From Operations
* Including the goodwill payment received from the transfer of Richmond Acura dealership
HK$’M Segment Turnover
17,235 14,578
1H2014 1H2013
Segment Turnover Segment Result From Operations Segment Margin
HK$'M 1H2014 % of total 1H2014 1H2014 Mainland China 13,252 76.9% 10,625 24.7% 262 263
2.0% 2.5%
Hong Kong & Macao 3,086 17.9% 2,904 6.3% 311 247 25.9% 10.1% 8.5% +1.6% pt Other Markets 897 5.2% 1,049
73 57* 28.1% 8.1% 5.4% +2.7% pt 17,235 100.0% 14,578 18.2% 646 567 13.9% 3.7% 3.9%
1H2013 1H2013 1H2013
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Segment Turnover Segment Result From Operations Segment Margin
HK$'M 1H2014 % of total 1H2014 1H2014 Mainland China 1,962 40.8% 1,608 22.0% 12 20
0.6% 1.2%
Hong Kong & Macao 2,555 53.1% 2,352 8.6% 128 120 6.7% 5.0% 5.1%
Other Markets excl. GDVTR 293 6.1% 320
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1.4% 1.6%
4,810 100.0% 4,280 12.4% 144 145
3.0% 3.4%
GDVTR 34 0.7% 53
91.4%
+57.2% pt 4,844 100.0% 4,333 11.8% 141 110 28.2% 2.9% 2.5% +0.4% pt
1H2013 1H2013 1H2013
4,844 4,333
1H2014 1H2013
Segment Turnover Segment Result From Operations HK$’M HK$’M
141 110
1H2014 1H2013
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DCH PRC Market
Note: - Figures included distributorship and dealership sales
1H2014 1H2013 1H2014 1H2013 Passenger Cars
40,500 33,300 +21.7% 9.6mn 8.7mn +11.2%
Commercial Vehicles
3,500 3,530
2.05mn 2.12mn
Total
44,000 36,800 +19.5% 11.7mn 10.8mn +8.4%
1H2014 Operation Review
Mainland China
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Key Brands
Audi 6 1 Bentley 7
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11 2 Isuzu / Qingling 5 4 Lexus 6
3 1 Nissan 5
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21 5 Others 8 1 Total no. of 4S shops / showrooms as of reporting date:
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1H2014 Operation Review (cont’d)
Mainland China Dealership Network
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1H2014 Operation Review (cont’d)
12 greenfield projects (in 10 cities) in progress:
In Progress Existing
Mainland China Dealership Development (4S shop & Showroom)
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by units by revenue 1H2014 vs 1H2013 1H2014 vs 1H2013
New car sales +21.6% +26.8% After-sales service +5.1% +16.2%
1H2014 vs 1H2013
New car sales unit +12.7% Service unit
After-sales service revenue +9.7%
% of dealership turnover 1H2014 1H2013
New car sales 91.2% 90.5% After-sales service 8.8% 9.5%
1H2014 Operation Review (cont’d)
Mainland China Same Store Growth Dealership sales breakdown
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DCH HK Market
1H2014 1H2013 1H2014 1H2013 Passenger Cars
4,800 4,600 +4.2% 18,900 17,900 +5.3%
Commercial Vehicles
2,000 1,700 +18.3% 7,600 6,100 +25.4%
Total
6,800 6,300 +8.0% 26,500 24,000 +10.4%
Note: The calculation of the variance % is based on the actual no. of units sold
1H2014 Operation Review (cont’d)
Hong Kong & Macao
DCH market share in Hong Kong by 30 June 2014
Overall 21.7% -0.3% point (1H13: 22.0%)
21 Dealership turnover: +25.8%
Increase in passenger car sales with an expanded dealership network Commercial vehicles - Domestic: above the market
79 4S stores and 14 showrooms as of today Profitability affected by initial costs of the greenfield shops opened in the last 2 years
1H2014 Operation Review and Outlook (cont’d)
Mainland China Dealership Expansion Outlook
12 greenfield projects rights secured including 8 4S stores and 4 showrooms New strategy of network expansion:
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1H2014 Operation Review and Outlook (cont’d)
Mainland China (cont’d) Enhancement of Motor Business profitability
To increase after-sales service revenue Enhancing commission income from auto insurance and auto finance Established a national insurance agency company to improve commission income Lubrication oil blending business doubled the sales in 1H14
Outlook
Expand motor leasing business to Kunming and Ningbo Setting up finance leasing business in China
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1H2014 Operation Review and Outlook (cont’d)
Hong Kong & Macao
Replacement demand for commercial vehicles stimulated by HKSAR Government’s HK$11.4 billion ex-gratia payment scheme Work closely with principals and body builders to ensure a smooth supply of commercial vehicles to meet the rising demand The first supplier of electric buses in Hong Kong Retrofitting the selective catalytic reduction device (SCR) for franchised bus
Outlook
Expect to maintain good contribution from commercial vehicle business New commercial vehicle service centre in San Tin, N.T. will commence operation in 2H14
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1H2014 Operation Review and Outlook (cont’d)
Other Markets
Singapore Semi-knock down assembly plant in Taichung to start operation in 2H14 Expecting strong demand in 2H14 triggered by infrastructure projects and the environmental policy of the Government Explore business opportunities in Myanmar and other countries in the Indochina region Other regions Singapore Taiwan
Outlook
Unit sales: +75.3% Market share in Japanese commercial vehicle: 13.5%, +3.2% point Unit sales: +21.4% Unit sales: -28.1%. 1H13 sales included a major tender to the Government Taiwan
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Strong sales growth driven by Pocari Sweat and CJ Dumplings
1H2014 Operation Review and Outlook
Mainland China
Sales: +30.8%, driven by dairy, snacks, confectionaries and beverages with the expanded regional sales platforms and market coverage Expand distribution of house brand Del Leche liquid milk in China Sales: -7.9% Change in product portfolio: a marked sales growth in frozen vegetables and groceries products Discontinued the JV with BRF S.A but both parties continued to maintain business operation on a non-exclusive basis
FMCG Food Trading Food Manufacturing
FOOD BUSINESS
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1H2014 Operation Review and Outlook (cont’d)
Mainland China
FOOD BUSINESS
Outlook
Acquired the distributorship of a wide range of premium imported Japanese confectionery and snack products in China in July 2014 Setting up new regional offices in major cities to expand geographic coverage for direct distribution and develop new sales channels Enhance sales growth and improve profit margin through close communications with principals, reduction of distribution and logistics costs, and better control of the value chain
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1H2014 Operation Review and Outlook (cont’d) FOOD BUSINESS
Hong Kong & Macao
Turnover of food processing: +12.7% Coffee and Tea sales: +11.6% Sales: +24.6%, driven by healthcare food products, dairy and beverages House brand Cheer sales: +71.8% especially in dairy products Moderate growth in turnover and gross margin under the volatile commodity market Import premium meat and seafood products
FMCG Food Trading Food Manufacturing Retail
To launch premium gourmet shop Moderate growth in turnover DCH food retail outlets in Hong Kong: 91 shops at 30 June 2014 Performance affected by high rental and labour shortage
Retail Food Manufacturing
Yuen Long food processing facility to expand and to enhance production capacity and efficiency
Outlook
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1H2014 Operation Review and Outlook (cont’d) CONSUMER PRODUCTS BUSINESS LOGISTICS BUSINESS
Sales: -31.9%, decline in sales of trendy headphones in Hong Kong and China Weak replacement demand for household electrical appliances in Hong Kong AEG showroom in Hong Kong opened in March 2014
Outlook
Multi-temperature distribution centre in Kunming commenced operation in July 2014 Expansion plan to Chengdu, Wuhan and Xiamen Planning to set up a new logistics and food processing centre in Hengqin Special Region in Zhuhai to serve strong demand in Macao Turnover: +19.8% with expansion of repacking, forwarding and importation businesses Cold chain operation in Guangzhou and repacking centre in Shanghai make a good contribution
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e-BUSINESS
To establish e-shopping platform DCHnYOU 大昌优品 (www.dchnu.com) to sell direct-
imported-quality products including food, electrical appliances, motor-related products, and other trendy items from overseas to PRC consumers through the Shanghai Free Trade Zone
Expect commencement of operation in 1Q 2015
PLEASURE BOAT BUSINESS
DCH has commenced the distribution of Princess motor yachts from UK to Hong Kong,
Macao and China market
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