MMC Group First-half 2016 (1H16) Financial Results
KEY HIGHLIGHTS – Double digit earnings growth 1H2015 3,424 1H2016 RM million 45%YoY 1,887 74%YoY 29%YoY 176 101 346 244 Revenue Pre-tax profit PATMI • • Revenue dropped by 45% or RM1,537 mil mainly due to: PATMI jumped 74% or RM75 mil mainly due to: a. Deconsolidation of Malakoff post IPO listing. a. Higher profit from ports & logistics division following the consolidation of NCB Holdings. b. However, cushioned by consolidation of NCB Holdings. b. Absence of provision for impairment on claims recovery of a discontinued project in Middle East. c. Moderated by lower contribution from KVMRT (tunnel) SBK line as constructions draw gradually towards completion. 2
REVENUE BREAKDOWN – The Start of a New Chapter 45% 3,424 45% YoY dropped in revenue mainly due to the deconsolidation effect post Malakoff listing in May 2015. 1,887 in RM million 2,044 54%YoY increased in Ports & Logistics’ 38 revenue mainly attributable to consolidation 496 37 of NCB Holdings as well as higher revenue 459 from PTP & JPB . 1,353 884 1H15 1H16 Ports & Logistics Energy & Utilities Engineering & Constructions Others Higher contribution from ports & logistics 1% 13% division following the listing of Malakoff in May 2015 as well as inclusion of NCB holdings. 26% 26% 72% 60% Moving forward, MMC will derive its revenue mainly from ports & logistics as well as 2% engineering & construction division. 3
PBT BREAKDOWN – The Start of a New Chapter 29% 29% YoY dropped in PBT following deconsolidation of Malakoff as well as lower 346 contribution from KVMRT (tunnel) SBK line. 244 Partially offset by higher contribution from 298 105 in RM million ports & logistics as well as lower losses at 110 corporate & others on the back of: 112 247 a. Gain on sale of land at SenaiAiport Free 175 Industrial Zone. (218) (239) b. Absence of provision for impairment on claims recovery of a discontinued project in Middle East. 1H15 1H16 Ports & Logistics Energy & Utilities Engineering & Constructions Others Lower contribution from energy & utilities as a result of reduced shareholdings in Malakoff to 19% 53% 37% from 51%. 23% 51% 30% 24% 4
QUARTERLY REVENUE BREAKDOWN 2Q16 vs 2Q15 34% YoY dropped in revenue mainly due to the 34% deconsolidation effect post Malakoff listing in 1,440 May 2015. RM million 2% Offset by higher contribution from NCB Holdings. 951 936 697 19 19 2Q16 vs 1Q16 227 269 19 Higher revenue from engineering & construction 260 division in-line with progress of existing projects i.e. Langat Centralized Sewerage Project. 690 663 464 However, moderated by lower contribution from ports & logistics division. 2Q15 1Q16 2Q16 Ports & Logistics Eng & Const Corp & others Energy & Utilities 5
QUARTERLY PBT BREAKDOWN 2Q16 vs 2Q15 33% YoY increased mainly attributable to: a. Higher contribution from engineering & 33% construction division due to absence of 54% RM million additional provision for SMART project 111 148 b. Lower losses at corporate due to absence of provision for impairment in Middle East 96 Partly offset by reduce shareholdings in 64 113 41 Malakoff post IPO listing in May 2015. 29 81 41 2Q16 vs 1Q16 142 107 105 54% QoQ increased in PBT due to higher contribution from energy & utilities division as well as engineering & construction division. (102) (116) Higher contribution from engineering & (150) construction division mainly attributable to: a. Higher progress of existing projects i.e. Langat Centralized Sewerage Project b. Improved performance at Zelan 2Q15 1Q16 2Q16 Ports & Logistics Eng & Const Corp & others Energy & Utilities 6
PORTS & LOGISTICS: Recorded 53% higher revenue Revenue Pre-tax profit Operational Statistics Port of Tanjung Pelepas Growth 1,353 Volume 1H 2016 53% (YoY) 10 RM469 mil 66 Container (mil. TEUs) 4.31 -3% 6 3 445 69 84 Johor Port Berhad 884 Conventional Cargo Growth 1H 2016 RM million 103 82 (in mil. FWT) (YoY) 310 306 Liquid bulk 6.22 0% 1H15 1H16 Dry bulk 2.26 6% Break bulk 0.57 19% Total Conventional 9.05 2% 41% Container (in '000 TEUs) 0.20 5% 247 RM72 mil 598 578 175 Northport (M) Bhd Throughput Growth 1H 2016 (in mil. FWT) (YoY) 1H15 1H16 1H15 1H16 Liquid bulk 1.08 -6% Dry bulk 1.12 26.0% PTP JPB NCB RSGT Break bulk 1.40 -14% RORO 0.34 23% Total Conventional 3.95 0% Note: In 1H15, MMC hold 21.1% in NCB Holdings. Current stake in NCB is 99.05% Container (in mil. TEUs) 1.57 16% 7
ENERGY & UTILITIES: Solid operating performance Revenue Revenue at Company Level Malakoff: Higher revenue mainly due to 2,044 the commencement of T4, 1000MW of 9%YoY coal fired power plant. 2,871 2,642 24%YoY RM million 1,935 1,557 Gas Malaysia: Higher revenue in-line with upward revision of natural gas tariff and higher volume of gas sold. 1H15 Malakoff Gas Malaysia 1H16 1H15 1H16 0 1H15 1H16 PATMI at Company Level Pre-tax profit Malakoff: Higher PATMI due to lower losses from associates and insurance 13%YoY RM million 65% claim on rotor replacement. 214 190 298 13%YoY 70 Gas Malaysia: Higher PATMI in-line 62 105 19 with higher volume of gas sold and 22 279 83 1H15 Malakoff Gas Malaysia 1H16 1H15 1H16 assets contributed by customers. 1H15 1H16 Malakoff Gas Malaysia 8
ENGINEERING & CONSTRUCTION: Early stage of mega projects Revenue Pre-tax profit KVMRT SBK Line Project Progress Lower PBT mainly due to: Higher revenue in-line with progress a. Effects from discontinued of existing projects i.e. COGEN plant receivables and unrealized loss at Pengerang and Langat Centralized on FOREX at Zelan Berhad Sewerage Project b. Lower contribution from KVMRT SBK Line tunneling works as the project has been substantially completed Overall c. Partially offset by the absence 86% 8% of provision for litigation costs RM37 mil 496 in relation to SMART project 459 Elevated 87% 2% RM2 mil Tunneling 89% RM million 112 110 1H15 1H16 1H15 1H16 9
SENAI LANDBANK – Continuously unlocking value SENAI AIRPORT CITY Historical transaction Areas Company *Transaction (acre) 384 EcoWorld Sold 41 Hersheys Leased (99years) IPark Development 189 Sold (AME) Leased (60 years) Fuji Oil 25 Total 639 Balance 2,079 *Full revenue and profit recognition for all transactions upon completion of the condition precedents. Total SAC Land: 2,718 acres 10
SENAI AIRPORT TERMINAL – Growing passengers Operational Statistics Senai Airport Terminal Growth Operational Data 1H 2016 (YoY) Passengers Traffic ('000) Domestic 1,167 4% International 201 57% Total 1,368 9% Cargo (tonnage) 3,185 19% Passengers handled (2009 – 2015) 2.59 2.32 0.36 1.99 0.25 1.38 0.19 1.34 1.31 1.24 0.05 0.14 0.02 0.02 2.23 2.07 1.80 1.33 1.32 1.22 1.17 2009 2010 2011 2012 2013 2014 2015 Domestic International 11
Note 17: Current Prospects The Group remains positive on its prospects, driven by stable performance of its operating companies together with contribution from on-going construction projects. Ports & Logistics Improve operational performance due to operational and cost synergies between the ports. Additional contribution from NCB arising from the completion of the acquisition. Energy & Utilities Group’s revenue and earnings will be reduced as a result of full year impact of the deconsolidation of Malakoff. However, the division is expected to contribute positively supported by a. Commencement of an additional 1,000MW in Tanjung Bin Energy power plant on March 21 st , 2016 b. Higher gas volume sales at Gas Malaysia Engineering & Construction Substantial existing order-book anchored by KVMRT SSP Line underground work and PDP role Other secured project: a. Langat 2 Water Treatment Plant b. Langat Centralized Sewerage Project c. Infra work for Rapid Pengerang co-generation plant d. PDP role for Pan Borneo Sabah Highway 12
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