Investor Presentation June 2020 1 Disclaimer This presentation is - - PowerPoint PPT Presentation

investor presentation
SMART_READER_LITE
LIVE PREVIEW

Investor Presentation June 2020 1 Disclaimer This presentation is - - PowerPoint PPT Presentation

Investor Presentation June 2020 1 Disclaimer This presentation is not an offer or invitation to subscribe to or purchase any securities. No warranty is given as to the accuracy or completeness of the information in this presentation. You must


slide-1
SLIDE 1

1

Investor Presentation

June 2020

slide-2
SLIDE 2

2

This presentation is not an offer or invitation to subscribe to or purchase any securities. No warranty is given as to the accuracy or completeness of the information in this presentation. You must make your own independent investigation and appraisal of the business and financial condition of KIPCO. Nothing in this presentation shall form the basis of any contract or commitment whatsoever. This presentation is furnished to you solely for your information. You may not reproduce it or redistribute to any

  • ther person.

This presentation contains forward-looking statements. These statements may be identified by such words as "may", "plans", "expects", "believes" and similar expressions, or by their context. These statements are made on the basis of current knowledge and assumptions. Various factors could cause future results, performance or events to differ materially from those described in these statements. No obligation is assumed to update any forward-looking statements. By participating in this presentation or by accepting any copy of the slides presented, you agree to be bound by the forgoing limitations. Figures in presentation have been rounded off.

Disclaimer

slide-3
SLIDE 3

3

KIPCO Group

slide-4
SLIDE 4

4

2018

774

2019

766

In KD mn REVENUE

Growth

  • 1%

28 30

NET PROFIT

6%

2019 results

slide-5
SLIDE 5

5

  • versubscription

US$314mn

(KD95mn) in equity @210 fils per share

17%

Successful completion of rights issue

slide-6
SLIDE 6

6

* Represents debt maturity as on September 30, 2019 after including the issue # Represents peak demand numbers being largest ever for KIPCO

7 years tenure Lowest ever coupon Diversified investor demand spread across Asia, ME, Europe and US offshore Largest ever demand Oversubscribed by Interest cost savings (annualized) Execution speed

Landmark bond transaction

slide-7
SLIDE 7

7

Key Group Companies

slide-8
SLIDE 8

8

▪ Net Profit growth of 3% ▪ Issued US$ 500 million in Perpetual Tier 1 Capital Securities with a yield of 5.75% ▪ Strong capital adequacy: 17%; stable asset quality: 2.1% NPA

Demand Initiators

▪ Revenue growth of 8% ▪ KAMCO completed merger with Global Investment House ▪ KAMCO reported a 47% growth in revenue

Demand Initiators

` ▪ Net profit growth of 12%; gross premium written growth of 8%

▪ Afya continues for the 3rd consecutive year ▪ Amongst top 5 insurance companies in the Middle East region1

Demand Initiators

1 based on gross premiums written

Performance highlights

▪ Revenue growth of 6% ▪ Continued to grow its facilities and student base

Demand Initiators

slide-9
SLIDE 9

9

▪ Revenue growth of 10% ▪ Revaluation losses impacted financial performance

Demand Initiators

▪ Revenue growth of 11%1 ▪ Net profit growth of 21%1 ▪ Healthy cash balance of SAR584mn with zero leverage

Demand Initiators

` ▪ Revenue growth of 13%1

▪ Acquired 60% stake in Jassim Transport Company in June 2019 ▪ Moving into petrochemical upstreaming projects with good potential

Demand Initiators

1 For the first nine months of financial year 2019-2020. QPIC & SADAFCO’s financial year starts on April 1st and ends in March 31st

Performance highlights cont’d

slide-10
SLIDE 10

10

*US$120mn savings against contractual value in 2019

OSN Update

▪ Ability to deliver product to all 25 countries in the region ▪ Exclusive DTH & OTT content rights in the 1st pay window ▪ Original Arabic Production in progress ▪ Rebranded OTT now with Disney+ starting April 2020; better user interface ▪ Focus on both direct and indirect distribution ▪ Content cost rationalized* ▪ 28% reduction in G&A and staff cost in 2019 vs. last year

Larger reach through OTT No one does content like OSN OTT platform progress Successful business streamlining

▪ New CTO & SVP , Marketing joined ▪ BoD strengthened with expertise on streaming (OTT) and original content

Strengthened Management Team

slide-11
SLIDE 11

11

Looking ahead 2020

slide-12
SLIDE 12

12

Oil price impact in 2020

▪ 2020 average forecast: US$391; 2019 average: US$642 ▪ Spot Brent price (3 June 2020): US$392

1 Average 2020 forecast as per Bloomberg 2 Per barrel as per Bloomberg

Global impact of Corona virus unknown as yet

▪ Significant and Evolving

Outlook

slide-13
SLIDE 13

13

COVID-19 impact management

During crisis:

  • Business to serve customers & minimize financial impact.

After crisis:

  • Ensure operational readiness to capture market opportunities.

1 2

slide-14
SLIDE 14

14

Initial observations on 2020 profit

Insurance

  • Stable picture in core business - Lower claims offset by slower revenue growth
  • Investment book performance hard to predict due to market volatility

Media

  • Outperforming budget in first 5 months
  • Increased customer usage and lower churn
  • New sales impacted by retail outlet closure from lock down
slide-15
SLIDE 15

15

Initial observations on 2020 profit cont’d

Banking

  • Uncertainty in loan book quality will remain
  • Investment book performance hard to predict due to market volatility
  • Regulatory directives uncertain

Real estate and hospitality

  • Fundamental matters effecting sector such as:
  • Population size
  • Travel and mobility
slide-16
SLIDE 16

16

Initial observations on 2020 profit cont’d

Petrochemicals

  • Oil price level for rest of the year will impact profitability

All businesses

  • Adapting to working from home - Group staff has risen to the occasion
  • Execution constraints on new initiatives being faced with vendors
slide-17
SLIDE 17

17

slide-18
SLIDE 18

18

Beginning digital journeys

slide-19
SLIDE 19

19

*Source: Google Play Store (03 June 2020)

665 total

5 4 3 2 1

Burgan Bank: New online banking app

Strong App rating*

Easy to Use Latest security features Multiple integrations Quick Pay More to follow….

slide-20
SLIDE 20

20

OSN: Streaming App Rebranded; Now with Disney+

4.0, 15k Ratings 4.4, 10.3k Ratings 4.4, 2.5k Ratings

Ratings

8.7 6.3 9.3 7.0 8.3 8.4 7.8 9.5

Source: Apple App Store; IMDb Ratings (10 June 2020)

slide-21
SLIDE 21

21

GIG: Investing in digital products & distribution channel

Operations

Digital

Distribution Products & Services

Invested in YallaCompare to strengthen digital distribution channels Motor Telematics Employee benefits Portal Claims Assessment Digital TPA Group CRM & Analytics Enhanced website (UI / UX); GIG Web Portal