Analyst Conference Q2/19 Friday, July 26, 2019
Agenda P.2 I. Consolidated Results - Q2/1 9 Consolidated Results - H1/19 Segments - Financial Updates II. Cement - Building Materials Business III. Chemicals Business IV. Packaging Business V. Summary
Q2/1 9 Revenue from Sales P.3 Revenue decreased q-o-q from all businesses, and dropped y-o-y from mainly lower chemicals price. -9% y-o-y MB -3% q-o-q 150,000 122,518 120,447 118,250 117,223 120,000 112,379 109,094 90,000 60,000 30,000 0 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19
Q2/19 EBITDA P.4 EBITDA dropped y-o-y on lower chemicals margins, while seasonal dividend helped q-o-q. MB 30,000 26,446 EBITDA 25,000 -25% y-o-y 22,303 5,925 +1% q-o-q 1,289 20,081 19,805 19,555 20,000 17,811 1,326 3,835 140 Dividend from 5,349 Associates 15,000 EBITDA from Operations 21,014 20,521 10,000 18,229 -30% y-o-y 17,671 16,246 14,456 -21% q-o-q 5,000 0 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 Note : EBITDA = EBITDA from Operations + Dividend from Associates
Q2/19 Equity Income P.5 Equity income declined - 25 % y-o-y, mainly from chemicals segments. . -25% y-o-y MB 6,000 -12% q-o-q 5,000 4,203 3,953 4,000 3,734 3,604 3,157 3,161 3,000 3,141 3,183 2,206 2,704 Chemicals 2,102 2,155 2,000 1,000 1,398 Non-Chemicals 1,059 1,030 1,020 1,002 812 0 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19
Q2/19 Profit for the Period P.6 Earnings of 9,079 MB is without the severance pay adjustment of 2,035 MB. -2 7 % y-o-y * MB - 22 % q-o-q * 20,000 15,000 11,143 12,406 12,40 2 9,079 11,662 (w/o impairments) (w/o severance pay 10,468 adjustment) 10,000 1,670 2 ,035 9,473 -43% y-o-y 7,044 5,000 -40% q-o-q 0 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19 Q2/19 ( 8 30) 430 (3, 185 ) Key Items 220 380 (1,410) 1) severance pay adjustment - - - - - (2,035) (Labor Law) 2 ) Inventory Gain (Loss)** 430 220 380 110 (2,200) (1,150) 3 ) Sale of Investment and - - - - 730 790 assets 4 ) Impairments (1,670)** * - - - - - Note: *Without Employee benefit expense from the amended severance pay of Labor Law ** Chemicals Business (Sub + Asso.) *** CBM 1,320 MB and 350 MB from others. (CBM = 820 MB from Indonesian operations, and 500 MB from Precast Thailand)
Agenda P.7 I. Consolidated Results - Q2/19 Consolidated Results - H1/19 Segments - Financial Updates II. Cement - Building Materials Business III. Chemicals Business IV. Packaging Business V. Summary
H1/19 Financials P.8 Revenue, EBITDA, and Profit for the period dropped - 7 % y-o-y, - 19% y-o-y, and -16% y-o-y , respectively on lower performance from the chemicals business, following trade war concerns and stronger Thai baht. Revenue from Sales EBITDA Profit for the Period MB MB MB 250,000 60,000 238,697 40,000 22 1 , 473 48,749 200,000 7,214 30,000 39,360 EBITDA 40,000 24,808 Dividend 150,000 6,675 20,741* 7,937 2,035 20,000 Eq Inc. 100,000 6,765 41,535 Eq Inc. 20,000 EBITDA from 32,685 10,000 Operations 50,000 16,871 Sub. 11,941 Sub. 0 0 0 H1/18 H1/19 H1/18 H1/19 H1/18 H1/19 EBITDA 17 % 1 5 % EPS: 2 0.7 15.6 Margin: 17.3* Note: *Without Employee benefit expense from the amended severance pay of Labor Law
H1/19 Segmented Revenue from Sales P.9 Chemicals and non-Chemicals sales were 42% and 58%, respectively. H1/18 H1/19 238,697 MB 221,473 MB (-7% y-o-y) Cement- Cement- Chemicals Building Materials Building Materials 42% Chemicals 36% 39% 46% Packaging Packaging 19% 18% MB 120,000 109,920 94,238 92,235 91,119 100,000 80,000 60,000 43,773 41,529 40,000 20,000 0 H1/18 H1/19 H1/18 H1/19 H1/18 H1/19 Cement – Building Chemicals* Packaging* Materials* Note: *figures are before elimination of intersegment transactions.
H1/19 Segmented Profit for the Period P.10 Chemicals was 5 1% of earnings, down from 6 5% in H1/18. H1/18 H1/19* 24,808 MB 20,741 MB (-16% y-o-y) Cement- Building Materials Cement- Chemicals Building Materials 17% Subsidiaries Chemicals Packaging 23% 30% Subsidiaries 12% 41% Packaging (51%) Chemicals Other 15% Equity Income 6% Chemicals (65%) Other 21% Equity Income 11% 24% MB 20,000 16,266 15,000 Eq Inc. 5,887 10,530 10,000 Eq Inc. 4,352 4,877 Sub. 4,161 5,000 3,110 10,379 3,056 2,351 Sub. 1,362 6,178 0 H1/18 H1/19 H1/18 H1/19 * H1/18 H1/19 H1/18 H1/19 Cement - Building Chemicals** Other** Packaging** Materials** Note: *Without Employee benefit expense from the amended severance pay of Labor Protection Act **figures are before elimination of intersegment transactions.
H1/19 Segments: Export Sales and ASEAN Operations P.11 ASEAN exports and operations were 25% of total sales. Sales Segments (by markets) Export Segments (by markets) 64,993 MB 53,882 MB 238,697 MB 221,473 MB Others Others 15% Others 18% 15% 15% N. Asia N. Asia 11% 11% 25% ASEAN* (ex-Thailand) 24% S. Asia S. Asia 13% 13% China/HK China/HK 21% 24% Thailand 60% 58% (domestic) ASEAN ASEAN (ex- (ex-Thailand) Thailand) 40% 37% H1/18 H1/19 H1/18 H1/19 Export as 27% 24% % of Sales Note: *ASEAN = ASEAN Operations + Export to ASEAN
H1/19 HVA’s Revenue from Sales P.12 MB 200,000 184,965 175,541 169,071 161,851 160,910 149,924 150,000 136,762 117,992 (+2% y-o-y) 92,628 100,000 85,768 54,865 59,161 50,000 38,837 7,783 0 2004 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 H1/19 HVA as a % of 4% 17% 19% 25% 29% 32% 34% 35% 35% 37% 38% 39% 39% 42% Revenue from Sales
Agenda P.13 I. Consolidated Results - Q2/19 Consolidated Results - H1/19 Segments - Financial Updates II. Cement - Building Materials Business III. Chemicals Business IV. Packaging Business V. Summary
H1/19 EBITDA on Assets, and EBITDA Margin P.14 EBITDA on assets (excluding projects under construction and Fajar’s assets) EBITDA on assets (excluding Fajar’s assets) EBITDA on assets Percent (%) 17.8 17.8 18 16.2 16 15.2 14.9 14.0 14.0 14.7 13.6 14 13.0 1 2.6 12.0 12.0 12 1 2.0 - Q2/19 consolidation of Fajar’s assets. *Note: 11.5* - Fajar’s EBITDA will be consolidated in Q3/19 10 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 H1/19 EBITDA Margin (%): 14 18 14 11 10 13 13 18 21 19 16 15 Note: EBITDA on Assets = EBITDA / Consolidated Assets EBITDA margin = EBITDA from Operations / Consolidated Sales
H1/19 Net Debt P.15 Leverage rose to 2.0 times (excluding Fajar’s net debt). Net debt to EBITDA Net debt to EBITDA (excluding Fajar’s net debt) Times (x) Billion Baht (Leverage) Net debt to EBITDA (excluding projects under construction and Fajar’s net debt) (Net Debt) 180 174.3 6 164.4 162.5 157.8 160 147.5 146.9 145.0 5 137.6 140 122.0 120.5 120 4 112.1 100 3.0 3.1 3 83.6 2.6 2.6 2.5 2.5* 2.4 80 2.0 2.0 1.8 60 1.7 2 1.5 1.4 1.6 40 1. 5 1 20 0 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 H1/19 Net Debt to Equity = 0.5 - Q2/19 consolidation of Fajar’s net debt. *Note: - Fajar’s EBITDA will be consolidated in Q3/19
H1/19 CAPEX & Investments P.16 Registered 39,768 MB in H1/19, as investments were 53% of the total. H1/19 Types: SBU: Others Others Maintenance 5% 1% 2% Efficiency Projects Chemicals 13% 28% Investment Billion Baht Packaging Greenfield 53% 60% & Expansion 80 Cement-Building Materials 28% 10% 70 60 50.0 50 47.0 45.8 46.1 45.2 45.0 42.4 39.8 40 34.8 34.5 32.0 30 27.2 18.4 20 10 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 H1/19 - CAPEX includes debottlenecking, expansion projects, and major turnaround. - Investments are acquisitions and purchase of shares (EV basis).
H1/19 Interest and Finance Costs P.17 Amounted to a total of 3,202 MB, while interest cost stood at 3.1%. MB 10,000 9,076 9,000 8,193 8,000 7,573 7,266 7,112 6,836 7,000 6,321 6,089 6,048 6,000 5,649 5,273 5,000 4,670 4,000 3,202 3,000 2,000 1,000 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 H1/19
Financial Highlights & Outlook P.18 Highlights: H1/19 dividend of 7.0 Bt/sh (8,400 MB), and payable on Aug 23 /19 (XD date on Aug 8 /19). Q2/19 one-time provisions of 2,035 MB to net profit, as a result of the severance pay adjustment (Labour Law). Cash & cash under management of 42,573 MB at the end of Q2/19, following the closure of the Fajar acquisition at the end of June 2019. Outlook: FY2019 CAPEX & Investments of approx. +70,000 MB, which includes the recent acquisition of Fajar in Indonesia, and ongoing construction of the LSP chemicals project in Vietnam, Fajar’s earnings will be consolidated into SCG Packaging’s financials beginning Q3/19, following the Q2/19 consolidation of the balance sheet.
Agenda P.19 I. Consolidated Results - Q2/19 Consolidated Results - H1/19 Segments - Financial Updates II. Cement - Building Materials Business III. Chemicals Business IV. Packaging Business V. Summary
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