Click to edit Master title style FALKLAND ISLANDS HOLDINGS Results Year ended 31 March 2013 Positioned for growth
Strategic Overview FIC: Positioned for oil led growth in Falklands Momart: Building further momentum PHFC: Modernising the fleet FKL: Delivering superior growth over the next 5 years : EPS target :Average annual growth+10% 2 2
FKL : Year ended 31 March 2013 Trading Overview • Revenue up by 4.4% to £35.6m (2012: £34.1m) — Momart : Strong growth – profits up 24% — FIC : Revenue investment – profits down £0.2m — PHFC – 9% decline in passenger numbers – profits down 10% Operating profit £3.5m (2012: £3.6m) down ‐ 1.8% • • Underlying pre tax profits +1.8% to a record £3.3m (2012: £3.2m) • Earnings per share on underlying profits 21.3p (2012: 26.2p) Share Capital +33% in July 2012 • Proposed full year dividend 11.5p per share up 4.5% (2012: 11.0p ) Cash £11.4m ( 2012 £2.8m ) • • Bank borrowings £2.0m ( 2012: £3.0m) • 12.8m FOGL shares owned : 1 for every FKL share in issue 3
FKL : Year ended 31 March 2013 FKL Group profit & loss account Trading Overview Year ended 31 March 2013 2012 £000 £000 Change +/- Turnover – continuing operations 35,596 34,109 +4.4% Underlying operating profit 3,502 3,568 -1.8% Interest (net) incl. pensions costs (211) (334) -36.8% Underlying pre tax profit 3,291 3,234 +1.8% Gain on sale of FOGL shares 768 - Share subscription costs ( 682 ) - Net settlement loss on pension - scheme (182) (96) (398) Amortisation of Intangibles (398) - 2,836 Reported Profit Before Tax 2,797 -1.4% Diluted EPS on taxed underlying PBT* 26.2p -18.7% 21.3p Weighted shares in issue 4 11,703862 9,239,057 +26.7%
FKL : Cash & Liquidity FKL Group net borrowings and liquidity 31 March 2013 31 March 2012 Change £000 £000 £000 (2,003) Bank Loans (2,987) 984 (4,913) Pontoon Finance Lease (4,938) 25 (372) Hire Purchase & Other borrowings (360) (12) (7,288) Total borrowings (8,285) 997 11,416 Cash 2,751 8,665 4,128 Net Cash /(Borrowings) (5,534) 9,662 Margin on bank loans 1.5% +libor 5
FIC : Preparing for First Oil 6
FIC – Year ended 31 March 2012 FIC : Trading ‐ Year ended 31 March 2013 • Sales flat at £15.2million ( +1.6% ) • Falklands economy – exploration stimulus limited – Leiv Eiriksson rig departed December 2012 • Cruise ship visitors down 15% ‐ impact on disposable income • FIC profits £0.2m lower at £1.3m ( 2012 £1.5m ) — Revenue investment for growth — Expansion of property and construction team – new property director — Investment in motor dealership – Falklands 4x4 ( www.falklands4x4.com ) • Retail: sales up 3.0% at £9.73m ( 2012 £9.45m ) • Motor: sales up 19% following investment in new Land Rover showroom • Support Services : Revenue down slightly at £1.2m • Freight income : Absence of North bound oil returns seen in 2011 • Property & Construction : Revenue up 13% , commission building of kit homes • FOUNDATIONS BEING LAID TO PARTICIPATE IN OIL LED GROWTH 7
– FIC : Year ended 31 March 2013 Revenue 2013 2012 Change £ million £ million % Retail 9.73 9.45 +3.0% Falklands 4x4 1.87 1.57 +19.1% Freight and port services 1.65 2.01 ‐ 17.9% Support services 1.21 1.28 ‐ 5.5% Property and construction 0.76 0.67 +13.4% Total Revenue 15.22 14.98 +1.6% Operating profit 1.33 1.52 ‐ 12.5% Operating profit margin 8.7% 10.1% ‐ 13.9% 8
Timeline for Oil Falklands : Timeline for Oil Sea Lion Timeline 2014 2015 2016 2017 2018 Further Exploration 2 rigs 2 rigs Field Development Lay down & Spool areas Develop Develop Flow Line Assembly Build Assemble Assemble Sub sea network Drill & Construct FIRST OIL FPSO FPSO Infrastructure Temp Harbour Start Finish New Deep Water Port Start Build Finish Utilities Develop Develop Develop Accommodation Build Build Source FIG & Regeneris 9
Falklands set for dramatic growth Base Case: Premier Oil, Sea Lion Development only • Building: Infrastructure commencing late 2013 , field construction mid 2014 Jobs: 400 plus new onshore jobs (+20%) from 2014 onwards for field development • Housing: 190 new units + temporary worker accommodation • • Economy: Falklands GDP set to increase from £140m to £1bn by 2018 ($100 bbl) ‐ 7 fold increase in 5 years • Tax Revenues: FI Govt revenues to increase from £50m pa to £400m pa by 2020 Further oil field developments would magnify these effects • Borders & Southern ‐ Darwin gas condensate discovery 190mmbbls (estim. • development cost $3.8bn) FOGL /Noble/ Edison – Exploration drilling in 2014 • (Source: Regeneris Social & Economic Effects of Oil & Gas in the Falklands 2013) 10 10
FIC: Positioned for Growth FIC: Positioned for Growth Key Falklands Data 2012 2018 2020 2022 Falklands Population ( excl MPA ) 2,471 2,811 2,771 2,771 Employed ‐ Base 1,575 1,575 1,575 1,575 Oil related Note 1 340 300 300 Total Employed 1,575 1,915 1,875 1,875 GDP ( £m ) £140 £1,000 £1,000 £800 FIG Income ( £m pa ) £50 Note 2 £50 £50 £50 Oil royalties & tax £0 £150 £400 £325 Total FIG income £50 £200 £450 £375 Note 1 Peak of 470 new jobs estimated in 2015 Note 2 ‐ FIG income excludes PAYE tax on jobs Source 2012 Census & Regeneris 2013 Report : Projections based on Sea Lion only 11
Sea Lion Impact on Jobs Sea Lion Impact on Jobs Projected Onshore Jobs Temp construction workers 100 Onshore O&G jobs 90 Private Services 90 Flow line Construction 50 Public Services 80 Port logistics & transport 70 Total at peak ( Sea Lion only ) 480 ( Source Regeneris esimates ) + 20% increase 12 12
FIC : Business Opportunities from Oil All specialist oil support services will be sourced externally largely from Aberdeen . Requirements : • Residential & Office accommodation — Further expansion of rental portfolio . — 26 x2 bed serviced apartments under construction . — Sites for modern HSE compliant offices — 200 man Workers Camp planning approval secured at Dairy Paddock Infrastructure – SATCO JV with Trant to focus on roads , utilities and ports • • Warehouses & storage ‐ 18 acres of land with planning permission • Food & supplies ‐ West Store market leader – established UK supply chain Vehicles & transport – Investment in 4x4 Land rover dealership & hire fleet • • Freight & Logistics to/from UK – Experienced UK / Stanley team 13 • Leisure & travel services– Penguin Travel and Agency leading FI providers 13
FIC: Fitzroy Road Apartments FIC: Fitzroy Road Apartments Site work commences July 2013 on 26 x 2 bed, serviced units with amenity blocks Site 1 14 14
FIC: Development sites in Stanley FIC: Development sites in Stanley Dairy Paddock 36 acre YPF site on Stanley site in central Stanley Harbour 2.25 acres Fairy Cove : 300 Prestige site for offices acre site next to Planning for workers camp and and high quality Navy Point Prime central site for 350 houses residential homes harbour site Site 2 offices , hotel / leisure Site 3 Crozier Place and East Coastel Rd site on Jetty, 3.0 acres Stanley Harbour 7.5 acres Warehousing, lay down areas and Prime central site for Offices, storage Site 5 Site 4 Hotel, Leisure. 15 15
FIC Construction FIC Construction Falkland Building Services (FBS) SATCO: South Atlantic Trading Company • Large (+£1m) infrastructure contracts • House building (kit homes) smaller projects and support for SATCO 50:50 JV with Trant Construction • • Subsidiary of FIC Trant is a privately owned engineering & • construction group, 700 employees & • Small local business acquired in 2012 turnover £100m merged with FIC’s own construction team • Worked in Falklands for > 10 years – built Expanding quickly – now employs 30 staff • new radar stations for MoD • Main contractor for Gosport Council for new pontoon in Gosport 16 • 16
New Deep Water Port New Deep Water Port • Site of Deep Water Port now agreed by FIG • FIC owns 300 acres of land at Fairy Cove adjacent to port site • Road surveys now complete • Construction of road & port facilities could commence as early as late 2013 Project cost c £100m incl. road • • Scalable to cope with further discoveries 17 17
FIC Strategy Summary FIC Strategy Summary Falkland Islands economy set for dramatic growth • • FIC in a unique position with its platform of service businesses and freehold land for development • Key projects 2013 ‐ 14 £m • 26x 2 bed serviced apartments 3.0 Falklands 4x4 0.3 • Builders Merchant & Garden Centre 0.5 • • In fill residential 0.5 • Crozier Place Offices 0.2 • Total 4.5 Warehousing , Offices and workers camp to follow in 2014 ‐ 15 • • Infrastructure projects – Roads , Utilities , Port could start by late 2013 • £10m equity raised provides sufficient funds for 2 years Bank facilities to support further development in 2015 onwards • • Preparatory work and investment through 2014 Returns from 2015 onwards. • 18
Momart : Building on its Reputation 19
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