RGB YE2011 Corporate Review RGB YE2011 Corporate Review 7 th March - - PowerPoint PPT Presentation
RGB YE2011 Corporate Review RGB YE2011 Corporate Review 7 th March - - PowerPoint PPT Presentation
RGB YE2011 Corporate Review RGB YE2011 Corporate Review 7 th March 2012 Safe Harbor Statement Safe Harbor Statement This presentation contains forward-looking statements (including, without limitation, statements regarding the enhancement of
This presentation contains forward-looking statements (including, without limitation, statements regarding the enhancement of shareholder value, and information and future guidance on our goals, priorities, orders, revenues, demand, growth opportunities, customer service and innovation plans, new product introductions, financial condition, earnings, liquidity, capital structure, operating performance, cost structure, cyclicality, the continued strengths and expected growth of the markets we sell into, operations, operating earnings, balance sheet models and our ability to be free cash flow positive under any normal economic environment) that involve risks and uncertainties that could cause results of RGB to differ materially from management's current expectations. Factors that could cause demand to be different from RGB’s expectations include customer acceptance of RGB and competitors’ products; changes in customer order patterns, including order cancellations; changes in the level of inventory at customers; and changes in business and economic conditions and the timing
- f award exercises by employees. RGB’s results could be impacted by unexpected economic, social,
political and physical/infrastructure conditions in the countries in which RGB, its customers or its suppliers operate, including military conflict and other security risks, natural disasters, infrastructure disruptions, health concerns and fluctuations in currency exchange rates.
Safe Harbor Statement Safe Harbor Statement
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Content Content
Page Highlights 4 Financial Overview 6 Business Segments Updates 9 Outlook, Targets & Strategies 18
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Highlights Highlights
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Highlights of FY2011 Highlights of FY2011
Business
- The Group manage to achieve favourable EBITDA in FY2011 (RM40.7 million)
through improvement in average machines performance, effective cost cutting exercise and closure of non performing outlets
- The Group is confident to achieve even better EBITDA in FY2012 with the
expected installation of approximately RM45 million new machines at various regions, commencement of new concessions as well as increase in SSM sales
Financial
- Improvement of Operating Cash Flow from RM3.1 million (FY2010) to RM54.6
million (FY2011)
- Trade Receivables reduced by RM28.6 million (37%) in FY2011
Corporate
- Proposed disposal of 32% equity interest in Chateau to Diplomat Technology
- Co. Ltd
- Repayment of RM28.4 million CP/MTN and Term Loans in FY2011
- Proposed fund raising exercise to retire the CP/MTN
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Financial Overview Financial Overview
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FY2011 Performance FY2011 Performance
FY 2011 RM ‘000 FY 2010 RM ‘000 Difference % Revenue 118,211 158,614
- 25.5%
EBITDA * 40,719 30,512 + 33.5% Loss Before Tax (32,904) (59,469) + 44.7% Loss Attributable to Owners of the Parent (30,849) (50,884) + 39.4% Basic Net Loss Per Share (sen) (2.68) (4.44) + 39.6% Net Assets Per Share (sen) 5 7
- 28.6%
* EBITDA = Earnings before interest, tax, depreciation, amortization, impairment of property, plant & equipment,
intangible assets and investments
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Improved profitability
Key Ratios Key Ratios
Better profitability and liquidity 12 months ended 31 Dec 2011 31 Dec 2010 Gross profit margin (%) 19% 3% Current ratio (times) 1.10 0.62 Quick ratio (excluding inventory) (times) 0.97 0.56 Gearing ratio borrowings (times)
- Gross
1.64 1.38
- Net
1.23 1.21
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Business Business Segments Updates Segments Updates
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Revenue by Business Segments Revenue by Business Segments
Year-on-Year (“YoY”) Group Revenue reduced by RM40.4 million (25%) as compared to FY2010 is mainly due to the following :- SSM YoY 35%
- RM24.1mil
- One-off sales of 267 used
machines to ex-concession Partner at RM11.2 million in FY2010
- Sales of 270 units of new machines
at a service fee of RM0.42 million in FY2011
- However, the revenue drop was
- ffset by RM7.9 million increase in
sales of machines in Malaysia & Vietnam in FY2011 TSM YoY 11%
- RM7.7mil
- Additional 5% management fees
imposed by PAGCOR resulting in approximately 7.3% drop in Philippines income
- Closure of non performing outlets
- Slight competition in Cambodia
regions L&E YoY 55%
- RM8.5mil
- Cessation of operation in Chateau
Notes: L&E: consist of revenue from companies involved in gaming and leisure activities Others: consist of revenue from manufacturing activities research & development and inter-segment transactions
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- 10.0
20.0 30.0 40.0 50.0 60.0 70.0 80.0 SSM TSM L&E OTHERS 45.1 63.0 6.9 3.2 69.2 70.7 15.3 3.4 RM'mil FY2011 - RM118.2 mil FY2010 - RM158.6 mil
FY2011 SSM revenue decreased by 35% (RM24.1 mil) as compared to FY2010 mainly due to :
- One-off sales of 267 used machines at RM11.2 mil to ex-concession Partner upon cessation of outlet in FY2010
- Sales of 270 unit of machines for RM0.42 million under service fee arrangement with manufacturers in FY2011
FY2011 SSM revenue decreased by 35% (RM24.1 mil) as compared to FY2010 mainly due to :
- One-off sales of 267 used machines at RM11.2 mil to ex-concession Partner upon cessation of outlet in FY2010
- Sales of 270 unit of machines for RM0.42 million under service fee arrangement with manufacturers in FY2011
SSM FY2011 Revenue Review SSM FY2011 Revenue Review
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* Actual Machines Sold in FY 2011 * Actual Machines Sold in FY 2010 Difference Units RM’000 Units RM’000 % Cambodia
- 1,260
16 1,693
- 25.5%
Macau 103 # 3,515 107 12,131
- 71.0%
Malaysia 67 6,683 20 3,684 + 81.4% Philippines 486 # 20,540 413 28,960
- 29.1%
Singapore 30 1,972 72 4,156
- 52.6%
Vietnam 124 10,732 75 5,836 + 83.9% Others
- 413
9 1,526
- 72.9%
Total 810 45,115 712 57,986
- 22.2%
One-off sales of 267 used machines to Partner upon cessation of outlet
- 267
11,200
- 100.0%
Grand Total 810 45,115 979 69,186
- 34.8%
* Included in SSM sales are revenue from slot machines and other casino related equipments # Included in SSM Sales are selling of 30 machines (Macau) and 240 machines (Philippines ) via service fees arrangement with manufacturer
TSM FY2011 Revenue Review TSM FY2011 Revenue Review
Country
- No. of Machines placed
Revenue (RM’000)
As at Dec 2011 (37 Outlets) As at Dec 2010 (36 Outlets) Difference Units As at Dec 2011 As at Dec 2010 Difference % Cambodia 2,475 2,192 + 283 27,060 29,641
- 8.7%
Philippines 2,011 1,824 + 187 26,951 29,061
- 7.3%
Vietnam
- 58
- 58
152 346
- 56.1%
Macau 396 426
- 30
5,285 3,569 + 48.1% Laos 185 159 + 26 3,198 5,497
- 41.8%
Singapore
- 349
- 100%
Others
- 373
2,258
- 83.5%
Total 5,067 4,659 + 408 63,019 70,721
- 10.9%
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10.9% drop in FY2011 TSM revenue as compared to FY2010 is mainly due to :
- Additional 5% Management Fees imposed by PAGCOR in FY2011 resulting in approximately 7.3% drop in
Revenue
- Closure of outlets in Vietnam (1), Laos (1), Macau (2), Philippines (2) and Singapore (1)
- Slight competition in Cambodia
- Competition at 1 of the outlets in Laos where upgrading of machines only took place in late 2011
However, revenue drop in the above regions have been offset by 48% revenue increment in Macau 10.9% drop in FY2011 TSM revenue as compared to FY2010 is mainly due to :
- Additional 5% Management Fees imposed by PAGCOR in FY2011 resulting in approximately 7.3% drop in
Revenue
- Closure of outlets in Vietnam (1), Laos (1), Macau (2), Philippines (2) and Singapore (1)
- Slight competition in Cambodia
- Competition at 1 of the outlets in Laos where upgrading of machines only took place in late 2011
However, revenue drop in the above regions have been offset by 48% revenue increment in Macau
TSM: New Concessions in FY 2011 TSM: New Concessions in FY 2011
No. Country Concession Venues Units of machines deployed Commencem ent Date YTD EBITDA Generated (RM’000) 1 Philippines PAGCOR Club Carmona 12 28th Jan 2011 (3) 2 Cebu Parkmall Satilie Casino 84 11th Mar 2011 505 3 Widus Casino 38 29th Jun 2011 646 4 Crown Regency Casino 12 18th Nov 2011 (11) Sub-total Philippines : 4 146 1,137 5 Cambodia Le Macau Casino 39 5th Feb 2011 43 Sub-total Cambodia : 1 39 43 Grand Total 185 1,180
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TSM: Cessation of Non TSM: Cessation of Non-Performance Performance Concessions in FY2011 Concessions in FY2011
No Country Concession location Date of Cessation YTD EBITDA Impact (RM’000) Remarks
1 Cambodia Silver World Casino 15th Mar 2011 (8) Closure of Casino 2 Macau Golden Dragon Casino 25th Feb 2011 (193) Unprofitable site. All machines relocate to Greek Mythology Casino (new concession site) 3 Vietnam Prince Club 2nd Apr 2011 26 All machines under concession sold to JV Partner 4 Philippines Carmona 9th Nov 2011 (3) Closure due to non performing of outlet Grand Total (178)
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EBITDA by Business Segments EBITDA by Business Segments
Despite a RM40mil drop in Group Revenue, FY2011 YoY EBITDA improved by RM10.2mil (33%) This is mainly due to effective cost control implementation and closure of non-performing outlets
SSM YoY 667% +RM4.0mil
- Reversal of RM1.3million
provision for sales return
- Effective cost cutting
measure implemented by management
TSM YoY 8%
- RM3.5mil
- Additional 5%
management fees imposed by PAGCOR resulting approximately 7.3% drop in income
- Closure of non -
performing outlets
- Slight competition in
Cambodia
L&E YoY 91% +RM12.8mil
- Reduction in operating
expenses
- Cessation of operations
in late 2011
Notes: L&E: consist of revenue from companies involved in gaming and leisure activities Others: consist of revenue from manufacturing activities research & development and other unallocated expenses
15 (20.0) (10.0)
- 10.0
20.0 30.0 40.0 50.0
SSM TSM L&E OTHERS 3.4 42.1 (1.3) (3.5) (0.6) 45.6 (14.1) (0.3) RM 'mil FY2011 - RM40.7 mil FY2010 - RM30.5 mil
Major Cost Components in FY2011 Major Cost Components in FY2011
16 FY2011 RM’000 FY2010 RM’000 Variance RM’000 Variance % TOTAL REVENUE 118,211 158,614 (40,403)
- 25.5%
TOTAL EXPENSES Purchases 39,475 33% 67,742 43% (28,267)
- 41.7%
Depreciation 49,824 42% 72,340 46% (22,516)
- 31.1%
Staff Cost 15,141 13% 19,265 12% (4,124)
- 21.4%
Finance Cost 9,570 8% 10,639 7% (1,069)
- 10.0%
Leasing Fee 3,886 3% 3,596 2% 290 + 8.1% Professional & Consultancy Fees 5,310 4% 4,207 3% 1,103 + 26.2% Rental Expenses 1,937 2% 3,241 2% (1,304)
- 40.2%
Travelling Expenses 2,173 2% 2,684 2% (511)
- 19.0%
Sales & Marketing Expenses 2,947 3% 4,032 2% (1,085)
- 26.9%
Upkeep of Machineries and Other Maintenance 1,555 1% 2,134 1% (579)
- 27.1%
Utilities 1,413 1% 2,066 1% (653)
- 31.6%
Other Expenses 2,491 2% 4,228 3% (1,737)
- 41.1%
Junket & Complimentary Room Expenses 1,654 2% 13,109 8% (11,455)
- 87.3%
Impairment / Written off of PPE & Receivables 14,452 12% 11,014 7% 3,438 + 31.2% Total Expenses 151,828 128% 220,297 139% (68,469)
- 31.1%
TSM: Update on Mobilisation Plan TSM: Update on Mobilisation Plan
As at Dec 2010 - Units at warehouse 1,240 Commentary Sites: Mobilized The remaining 122 units
- f machines are
allocated for the upcoming cruise ship
- peration
Cambodia 38 Philippines 109 Myanmar 31 Laos 16 Sub-total of mobilized units for FY2011 (194) Impairment and written off of machines with zero value (924) Units to be mobilized in FY2012 122
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Outlook, Targets & Outlook, Targets & Strategies Strategies
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A better outlook ahead
Outlook for FY2012 Outlook for FY2012
Division Outlook Targets Strategies
SSM Relatively promising
- Expected to sell 900
machines by FY2012
- Entered new venture with Bingo machine
manufacturer to start distribution and concession of Bingo Machines in Philippines
- Bingo machines are popular as it expects to
replace the traditional Bingo in Philippines market
- Establish more sales presence in
Cambodia, Vietnam and Korea TSM Sustainable income
- Approximately 600
additional machines will be installed by end of FY2012
- Deployment of 122 fully
impaired machines on cruise ships
- TSM Income from Bingo
Machines
- Continuous exploration of new concessions
in Indo-China, Philippines and Macau
- Placing of new machines to improve yield
- Focus on the disposal of used machines at
warehouse
- New concession of Bingo Machines on
profit sharing basis in Philippines
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A better outlook ahead
Outlook for FY2012 (cont) Outlook for FY2012 (cont)
Division Outlook Target Strategies
L&E Recurring Rental Income
- Generate additional
rental income
- No operating losses
- Continue to look for tenants for the
remaining floor space
- Continue to look for potential buyers for
the disposal of remaining equity interest in Chateau Others Positive
- Launching of new
RGBGames in Q3 2012 under collaboration with Top Games Designer
- We have entered into agreement with a
renowned games development company to develop new RGBGames Operating Cash Flow Positive
- Additional RM15mil
repayment for CP/MTN
- Reduction of Finance
Cost
- Debts Reduction plan
- Conversion of CP to Term Loans
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THANK YOU THANK YOU
For information, please contact RGB International Bhd. at Telephone: +604-2631111 | Email: ir@rgbgames.com