ANALYSTS ’ BRIEFING N OVEMBER 12, 2015
O UTLINE Background Business Groups, Products and Markets After the IPO Financials Business Plans
I NTRODUCTION OF E XECUTIVES Walter H. Villanueva , Filipino Chairman of the Board General Manager – Pipes Group General Manager – PPR/HDPE Division Eugene H. Lee-Villanueva , Filipino Director President General Manager – Compounds Division Tita P. Villanueva , Filipino Director Vice President – Comptroller Nicasio T. Perez , Filipino Director Vice President – Treasurer
I NTRODUCTION OF E XECUTIVES Derrick P. Villanueva , Filipino Director General Manager – Pipes Division Hans Joseph T. Perez , Filipino Assistant General Manager-PPR/HDPE Division Samuel Leonard S. Lee Villanueva , Filipino Assistant General Manager-Compounds Division
B ACKGROUND 1989 1990 1998 2003 IC Tubes Films Incorporated Entered business of Changed business manufacturing PVC and started to production and pipes (flexible operations sale of PVC electrical 1998; trading imported compounds for electric and potable PE compounds wires and cables Bottles water 2000; sanitary and paraffin 2002; pressure main Expanded the application distribution & telco waxes of PVC compounds conduit pipes 2006) 2006 & 2013 April 2015 August 2015 September 2015 Expanded Started trading Listed on the Started manufacturing CROWN HDPE pipes Philippine Stock manufacturing own PPR pipes. and fittings in 2006 Exchange on capacity of HDPE pipes and manufacture own April 27, 2015 HDPE pipes in 2013
B USINESS G ROUPS Pipes Group Compounds PVC Pipe PPR/HDPE Division Division Division
C OMPOUNDS D IVISION
C OMPOUNDS D IVISION Wires and Cables IC Tubes Films & Sheets Bottles Customized Compounds
C OMPOUNDS S ALES 100% 90% 80% 44% 57% 57% 58% 70% 60% 50% 40% 30% 56% 43% 43% 42% 20% 10% 0% 2013 2014 3Q 2014 3Q 2015 Export Local
C OMPOUNDS S ALES BY A PPLICATION 100% 3% 4% 4% 5% 5% 5% 7% 6% 90% 5% 4% 6% 6% 5% 7% 80% 8% 8% 70% 60% 50% 82% 40% 80% 76% 75% 30% 20% 10% 0% 2013 2014 3Q 2014 3Q 2015 Wires & Cables IC Tubes Films & Sheets Bottles Others
P IPES G ROUP
PVC P IPE P RODUCTS
PVC P IPE F ITTINGS
PVC P IPE F ITTINGS
P IPE G ROUP S ALES 100% 90% 38% 80% 46% 47% 49% 70% 60% 50% 40% 62% 30% 54% 53% 51% 20% 10% 0% 2013 2014 3Q 2014 3Q 2015 Project Sales Trade Sales
P IPE G ROUP S ALES BY P RODUCT G ROUP 100% 90% 80% Percentage of Product group Sales 70% 60% 50% 40% 30% 20% 10% 0% 2013 2014 3Q 2014 3Q 2015 Sanitary 49.72% 44.19% 45.34% 45.12% Electrical 36.93% 40.82% 38.95% 39.46% Potable 6.50% 6.12% 6.57% 5.66% PPR/HDPE 2.54% 2.73% 2.36% 5.04% Watermain 1.57% 1.69% 1.62% 1.86% Telecom 0.29% 1.11% 1.28% 0.19% Others 2.45% 3.33% 3.89% 2.67%
R EGIONS C OVERED REGIONS • Region I (Ilocos Region) • CAR (Cordillera Administrative Region) • Region II (Cagayan Valley) • Region III (Central Luzon) • NCR (Metro Manila) • Region IV-A (Calabarzon) • Region IV-B (MIMAROPA) • Region V (Bicol Region) • Region VI (Western Visayas) • Region VII (Central Visayas) • Region VIII (Eastern Visayas) • Region IX (Zamboanga Peninsula) • Region X (Northern Mindanao) • Region XI (Davao Region) • Region XII (SOCCSKSARGEN) • Region XIII (CARAGA) • ARMM (Autonomous Region of Muslim Maguindanao)
M ARKET C ATEGORIES PROJECT SALES TRADE SALES • GOVERNMENT PROJECTS • DISTRIBUTORS • SUBDIVISIONS • WHOLESALERS • HERITAGE RESORTS • DEALERS • MALLS • CONVENTION CENTER • HOSPITALS • HOTELS • SCHOOLS • SUPERMARKETS • OFFICE BUILDINGS • RESIDENTIAL BUILDINGS
PPR / HDPE DIVISION
PPR P IPE P RODUCTS The CROWN PP-R series that adheres to International Standards, are manufactured with high grade quality material for maximum safety, strength and durability to suit your essential needs for a wide range of hot and cold water applications.
HDPE P IPE P RODUCTS C ROWN FUERZA • High-end and industrial piping applications which demand higher pressure rates. C ROWN SIGMA • Gas pipe for natural gas distribution network with pressure rate up to 4 bars. • Drinking water pipe with pressure rate up to 16 bars. • Sewers, drainage, irrigation and distribution lines. FEATURES • Chemical resistant with thermal properties • High flow capacity • Long life cycle • Non-corrosive • Tough and flexible • Weather and environmental stress resistant
PPR P IPE F ITTINGS
HDPE P IPE F ITTINGS
A FTER THE IPO BREAKDOWN OF NET PROCEEDS FROM THE IPO AS AT SEPTEMBER 30, 2015 Amounts Amounts Purpose Net Allocated Disbursed Construction of PP-R and HDPE manufacturing plant and warehouse, and Purchase of PP-R and P66,200,000 P60,715,000 P5,485,000 HDPE equipment Debt retirement 43,800,000 43,800,000 - Modernization of Existing Compounds and Pipes 25,000,000 3,500,000 21,500,000 Plants Working capital purposes 68,988,361 62,150,000 6,838,361 Total P203,988,361 P170,165,000 P33,823,361
A FTER THE IPO MARKET INFORMATION P/E-TTM Price as of 11/06/15 P2.45 CROWN 16.83x I/O Shares 630.80 million PSEi 20.07x MCAP P1.55 billion DNL 22.43x 52-Week High P3.33 Regional Comparables 19.26x 52-Week Low P1.41* *IPO Price
S UMMARY OF C OMPREHENSIVE I NCOME Increase Jan. to Sept., Jan. to Sept., In P millions 2013 2014 /Decrease 2014 2015 % REVENUES P 801.82 P 850.74 P 622.37 P 799.24 28.42% Cost of Goods Sold 628.53 639.43 474.31 612.24 29.08% GROSS PROFIT 173.29 211.31 148.06 187.00 26.30% Other Operating Expense 103.86 115.96 84.09 84.76 .80% OPERATING INCOME 69.43 95.35 63.97 102.24 59.82% Other Income (Charges) 1.64 (1.63) (0.81) (1.51) 85.96% INCOME BEFORE TAX 71.07 93.72 63.16 100.73 59.49% Income Tax Expense 21.32 28.34 19.12 30.23 58.15% NET INCOME P 49.75 P 65.38 P 44.04 P 70.50 60.06% Earnings per Share P 0.14 P 0.14 P 0.12 P 0.15 25%
S UMMARY OF F INANCIAL P OSITION Increase/(Decrease) In P millions 2013 2014 September 2015 % Total Current Assets 480.18 604.24 748.51 23.88% Total Noncurrent Assets 177.46 224.81 262.50 16.77% TOTAL ASSETS 657.63 829.05 1,011.01 21.95% Total Current Liabilities 139.47 251.10 176.59 (29.67%) Total Noncurrent 16.14 15.05 15.72 4.45% Liabilities TOTAL LIABILITIES 155.61 266.15 192.31 (27.74%) TOTAL EQUITY 502.02 562.90 818.70 45.44% TOTAL LIABILITIES & 657.63 829.05 1,011.01 21.95% EQUITY
B USINESS G ROUPS Sales per Business Group 100% • ad 90% 34.84% 34.55% 35.21% 35.63% 80% 70% 60% 50% 40% 65.16% 65.45% 64.79% 64.37% 30% 20% 10% 0% 2013 2014 3Q 2014 3Q 2015 Compounds Pipes Group
K EY P ERFORMANCE I NDICATORS 2013 2014 September 2014 September 2015 Return on Assets 7.83% 8.80% 6.15% 7.66% Return on Equity 10.33% 12.28% 8.44% 10.20% Current Ratio 3.44x 2.41x 2.60x 4.24x Total Liabilities to 0.31x 0.47x 0.43x 0.23x Equity Ratio Days Inventory 96 days 137 days 173 days 184 days Days Receivable 65 days 63 days 85 days 87 days Days Payable 63 days 67 days 98 days 78 days
B USINESS P LANS (4 TH QUARTER 2015) • Completion of PPR warehouse. • Complete delivery of metal moulds for PPR Fittings. • Completion of Flood Control System. • Delivery of Compounds Division new extruder in December, 2015. • Acquisition of Pipe Division new Extruder. • Acquisition of two (2) new trucks to augment delivery capacity
B USINESS P LANS (2016) • Added capacity of new Compounds extruder for bottles, IC tubings and films & sheets. • Delivery of Pipe Division new extruder for big sized PVC Pipes. • Enhance customized Compounds formulations. • Additional product in sizes, specifications, colors and customization. • Set-up Marketing Department. • Broaden market reach to more key cities. • Hiring more Field Sales Representatives, Project Group and Business Development personnel. • Active participation in exhibits and events. • More advertising.
E ND OF P RESENTATION
T ITA P . V ILLANUEVA I NVESTOR RELATIONS OFFICER C ONTACT D ETAILS : (413)-8032 - 35 E MAIL A DDRESS : tpvillanueva@crownpvc.com.ph
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