Mega First Corp. Bhd. · MYX:MFCB
Mega First Corp. Bhd — Q3 2024 Earnings Presentation
95 slides from Mega First Corp. Bhd's earnings presentation, Nov 28, 2024
Slide 1: 3Q2024 Results Briefing
3Q2024 RESULTS BRIEFING 28 November 2024
Slide 2: Agenda
AGENDA 1. Financial Review For reference (updated) - 3Q2024 Earnings Review 4. Renewable Energy Division - Balance Sheet Review 5. Packaging Division - Cash Flow Review - Capital Deployed 6. Resources Division - Gearing Position 7. Investment in Joint Venture - JV Edenor Technology Edenor Technology
Slide 3: 3Q2024 Earnings Review
3Q2024 EARNINGS REVIEW § Group revenue +16.1% to RM372 mil, driven by improvements across all core divisions (+10.2%) and maiden sales from CSC (RM20.8 mil). § Core PBT +9.6% to RM151.7 mil, attributed to improved contributions from RE and Resources divisions, partially offset by a decline in the Pa
Slide 4: Normalised Profit Before Tax
NORMALISED PROFIT BEFORE TAX Despite strong earnings from core divisions: • 3Q normalised PBT declined 5.7% from RM135.8 mil to RM128.1 mil. • This decline mainly attributable to RM18.4 mil forex loss in the current quarter, compared to RM0.9 mil forex gain in 3Q2023. • 9M normalised PBT rose only m
Slide 5: Normalised Profit After Tax and Non-Controlling Interest (PATNCI)
NORMALISED PROFIT AFTER TAX AND NON-CONTROLLING INTEREST (PATNCI) • 3Q normalised PATNCI rose 13.0% from RM106.7 mil to RM120.7 mil despite higher forex loss (RM17.0 mil loss versus RM0.1 mil gain in 3Q2023). • The increase was primarily attributable to an increase in the effective equity interest i
Slide 6: Renewable Energy Division
RENEWABLE ENEGY DIVISION
Slide 7: Earnings Review - Renewable Energy Division
EARNINGS REVIEW - RENEWABLE ENERGY DIVISION 3Q2024 vs 3Q2023 • Revenue +11.9% to RM183.8 mil: higher hydro energy sales (+12%) and higher solar energy sales (+6.1%). • Higher hydro energy sales: Energy volume +18.5% to 664.02 GWh from the new 5th turbine added in July. • Average EAF: 92.5% for 5 tur
Slide 8: Renewable Energy Division - Don Sahong
RENEWABLE ENERGY DIVISION - DON SAHONG Don Sahong : January - September Pakse Water Level and Capacity Factor/EAF
Slide 9: Resources Division
RESOURCES DIVISION
Slide 10: Earnings Review - Resources Division
EARNINGS REVIEW - RESOURCES DIVISION 3Q2024 vs 3Q2023 • Revenue +24.8% to RM60.3 mil: higher sales volume of lime products due to strong demand in Malaysia and the regional market, and supported by a lower base in 3Q2023 due to plant maintenance by a major customer. • PBT +147.3% to RM13.6 mil: incr
Slide 11: Packaging Division
ne | \\ PACKAGING DIVISION
Slide 12: Earnings Review - Packaging Division
EARNINGS REVIEW - PACKAGING DIVISION 3Q2024 vs 3Q2023 • Revenue remained flat at RM98.3 mil despite a challenging operating environment characterised by weak consumer demand and excess industry capacities. • PBT (excluding insurance income) -25.7% to RM7.5 mil: margin pressures from intense price co
Slide 13: Balance Sheet Review
BALANCE SHEET REVIEW At 30. 1024 At 31.12.2023 Changes Explanation (RM million) (RM million) _(RM million) Service concession asset 1,682.1 1,940.0 (257.9)|RM190.3 mil translation loss and RM67.6 mil amortisation charge. PPE 983.2 5319 451.3 |Mainly due to RM354.8 mil transfer from development expen
Slide 14: Cash Flow Review
CASH FLOW REVIEW 9-Month Period Ended 2024 2023 (RM mil) (RM mil) After tax cash from operating activities 459.0 431.0 Net cash inflow from non-operating investment activities 18.9 18.0 New capital from minority of subsidiary - - Total Cash Made Available to the Group 477.9 449.0 Investing Activitie
Slide 15: Expansionary Investment Capital Deployed
EXPANSIONARY INVESTMENT CAPITAL DEPLOYED 9M2023: RM154.8 mil 9M2024: RM297.2 mil
Slide 16: Gearing Position
600.0 500.0 400.0 300.0 200.0 100.0 00 GEARING POSITION 30.0% 25.0% 20.0% 10.0% 5.0% 0.0% 31.12.2020 31.12.2021 31.12.2022 31.12.2023 309.2024 mmm Net Debt (RM mil) ~—=Net Debt/Equity (6) At 31.12.2020 | At 31.12.2021 | At 31.12.2022 | At 31.12.2023 | At 30.9.2024 (RM mil) (RM mil) (RM mil) (RM mil)
Slide 17: JV Edenor Technology
JV EDENOR TECHNOLOGY 2023 2024 1Q 2Q 3Q 4Q Total 1Q 2Q 3Q Total (RM mil) (RM mil) (RM mil) (RM mil) (RM mil) (RM mil) (RM mil) (RM mil) (RM mil) Revenue 265.0 220.7 207.8 198.3 891.8 197.9 176.2 217.9 592.0 Depreciation 9.2 9.1 9.1 9.4 36.8 9.5 9.3 8.9 27.7 and amortisation PBT (7.5) (20.0) (9.1) (1
Slide 18: Other Updates
OTHER UPDATES Ø New Concession Agreement (“CA”) and Power Purchase Agreement (“PPA”) • New CA and PPA will encompass all 5 turbines. • Approved by Lao’s National Assembly Standing Committee on 20 November 2024. • Expected execution of agreements by relevant government agencies by 31 December 2024.
Slide 19: Prospects for the Fourth Quarter of 2024
PROSPECTS FOR THE FOURTH QUARTER OF 2024 Ø Normalised PATNCI (excluding share of JVs and associates’ earnings and one-off non-operational items) +16.4% YoY to RM333.4 mil in the 9 months of 2024 (9M2023: RM286.5 mil). • In spite of a strengthening Ringgit, which resulted in RM13.6 mil forex loss (af
Slide 20: Capital Commitment as at 30 September 2024
PROSPECTS FOR THE REMAINING QUARTER OF 2024 CAPITAL COMMITMENT AS AT 30 SEPTEMBER 2024 Factory construction: RM33.1 mil Production machinery: RM52.1 mil
Slide 21: Prospects: Renewable Energy Division (Hydro)
PROSPECTS FOR THE REMAINING QUARTER OF 2024 Renewable Energy Division (Hydro) Ø In 4Q2024, hydro energy sales are expected to grow by 12% YoY due to the enhanced generation capacity from the new 5th turbine, commissioned on 4 July. However, this revenue growth is expected to be tempered by the follo
Slide 22: Prospects: Renewable Energy Division (Solar)
PROSPECTS FOR THE REMAINING QUARTER OF 2024 Renewable Energy Division (Solar) Ø We expect solar energy earnings to continue to grow on progressive installation of secured solar capacities. Ø Currently, 28.8 MWp of solar capacity is operational, with an additional 65.9 MWp set to begin in 2025, bring
Slide 23: Portfolio Summary as at 30 September 2024
PROSPECTS FOR THE REMAINING QUARTER OF 2024 PORTFOLIO SUMMARY AS AT 30 SEPTEMBER 2024
Slide 24: Renewable Energy Division Don Sahong
RENEWABLE ENERGY DIVISION DON SAHONG
Slide 25: Renewable Energy Division Don Sahong
RENEWABLE ENERGY DIVISION DON SAHONG
Slide 26: Prospects: Packaging Division
PROSPECTS FOR THE REMAINING QUARTER OF 2024 Packaging Division Ø The packaging industry faces challenges from weak consumer sentiment and global overcapacity, leading to intensified competition. Ø Margins are expected to be under short-term pressure due to the upcoming commercialisation of Stenta's
Slide 27: Packaging Division Bangi (Stenta)
PACKAGING DIVISION BANGI (STENTA)
Slide 28: Packaging Division Melaka (Hexachase)
PACKAGING DIVISION MELAKA (HEXACHASE)
Slide 29: Prospects: Resources Division
PROSPECTS FOR THE REMAINING QUARTER OF 2024 Resources Division Ø Overall demand for lime products in this region is anticipated to remain robust, but visibility of export is uncertain, clouded by shifting competitive dynamics due to sharp changes in transport costs and forex rate, as well as heighte
Slide 30: Prospects: Edenor Technology and Food Security Division
PROSPECTS FOR THE REMAINING QUARTER OF 2024 Edenor Technology Ø Edenor experienced significant capacity losses due to extended scheduled and unscheduled plant shutdowns for repairs and upgrades. Ø Edenor’s management is optimistic about a recovery in earnings by 2025 as plant reliability improves an
Slide 31: Food Security Division CSC Agriculture Holdings
FOOD SECURITY DIVISION CSC AGRICULTURE HOLDINGS
Slide 32: Food Security Division CSC Agriculture Holdings
FOOD SECURITY DIVISION CSC AGRICULTURE HOLDINGS
Slide 33: Our Sustainability Strategy
OUR SUSTAINABILITY STRATEGY
Slide 34: Key Sustainability Updates
KEY SUSTAINABILITY UPDATES @® © e @ PJB received a , Sustainability 101 The ¥Zepp Q) s9;ideal ‘and Data owner | acquisition of Special za trainings for | 40% effective =| Mention at The Received a °C Official Launched our —-Hexachase Group | equity interest eee Edge Malaysia Establishing Sustainabil
Slide 35: Key Sustainability Updates
KEY SUSTAINABILITY UPDATES July For subsidiary: Grant Ascent Sdn. Bhd. Key topics discussed: Management of ESG topics —- Land management, Environment and Human Rights issues Investor a? ngegemens | AmBank Group | For subsidiary: Mega First Corporation Berhad, Idaman Harmoni Sdn. Bhd. Sep Key topics
Slide 36: Our Sustainability Plan for 2024
OUR SUSTAINABILITY PLAN FOR 2024
Slide 37: Environment Dashboard
ENVIRONMENT ENVIRONMENT DASHBOARD Disclosure Q1 - Q3 2023 Q1 -— Q3 2024 Total Renewable Energy 1,556 1,664 Generated‘ GWh i GWh Total CO2- avoided from The 913,070 1.031 Environment tonnes H mil. tonnes Total Waste Diverted From 4,293 5,217 Disposal? tonnes : tonnes Notes: 1. Total Renewable Energy
Slide 38: Social Dashboard
SOCIAL DASHBOARD SOCIAL Q1 — Q3 2023 Q1 — Q3 2024 ee fp OQ: e e a 424 2A aiaeaa Workforce i Workforce Ratio in . H Ratio in . Workforce 3.3 males : 1 female Workforce 3.3 males : 1 female Ethnicity 17% 41% = AY i Ethnicity Chinese =Malay s=Indian © Others H =Chinese =Malay =Indian © Others Note: 1.
Slide 39: Safety Dashboard
SAFETY DASHBOARD Disclosure Q3 2023 \/ \ 0 Work-Related 0 . 12 0 . 10 Injuries Fatalities High Consequence Cases Fatalities High Consequence Cases Injuries Injuries I I. J\ rae y \ + \ \ Work-Related | 0 4 0 0 ill Health Fatalities Cases Fatalities Cases x J y \ J E Note: 1, The data cover the three
Slide 40: Governance Dashboard
GOVERNANCE DASHBOARD GOVERNAN Disclosure Q1 -— Q3 2023 Q1 -— Q3 2024 Confirmed Incidents of Corruption i 0 i 0 Confirmed Incidents Of Non-compliance i 0 i 0 With Laws And Regulations Legal Actions For Anti-Competitive Behaviour, Antitrust, And Monopoly Practices i Complaints Received Concerning : Br
Slide 41: Remaining Slides for Reference (Updated)
Remaining Slides for Reference (Updated)
Slide 42: Renewable Energy Don Sahong
RENEWABLE ENERGY DON SAHONG
Slide 43: Renewable Energy Division Don Sahong
RENEWABLE ENERGY DIVISION DON SAHONG
Slide 44: Renewable Energy Division Don Sahong
RENEWABLE ENERGY DIVISION DON SAHONG • 260 MW run-of-river hydropower project located on the mainstream of the Mekong River in Southern Laos. • High projected average Energy Availability Factor (EAF) of 89% (2023: 91.4%) compared to other large hydro of between 40-70%. • Projected average energy gen
Slide 45: Renewable Energy Division Don Sahong
RENEWABLE ENERGY DIVISION DON SAHONG
Slide 46: Renewable Energy Division Don Sahong
RENEWABLE ENERGY DIVISION DON SAHONG
Slide 47: Renewable Energy Division Don Sahong
RENEWABLE ENERGY DIVISION DON SAHONG
Slide 48: Renewable Energy Division Don Sahong
RENEWABLE ENERGY DIVISION DON SAHONG
Slide 49: Renewable Energy Division Don Sahong
RENEWABLE ENERGY DIVISION DON SAHONG
Slide 50: Renewable Energy Division Don Sahong
RENEWABLE ENERGY DIVISION DON SAHONG
Slide 51: Renewable Energy Division Don Sahong
RENEWABLE ENERGY DIVISION DON SAHONG
Slide 52: Don Sahong: 2022-2023 Pakse Water Level and Capacity Factor/EAF
RENEWABLE ENERGY DIVISION DON SAHONG Don Sahong : 2022-2023 Pakse Water Level and Capacity Factor/EAF
Slide 53: Renewable Energy C&I Solar
RENEWABLE ENERGY C&I SOLAR
Slide 54: Renewable Energy Division C&I Solar
RENEWABLE ENERGY DIVISION C&I SOLAR
Slide 55: Renewable Energy Division Financial Highlights
RENEWABLE ENERGY DIVISION FINANCIAL HIGHLIGHTS
Slide 56: Renewable Energy Division Strategy & Strength
RENEWABLE ENERGY DIVISION STRATEGY & STRENGTH Strategy • Leveraging current strong and stable cashflow of approx. RM500 mil per annum from existing RE portfolio to pursue selective RE opportunities in the region. Strength • Strong project management/execution track record → Don Sahong completed sign
Slide 57: Renewable Energy Division Investment Approach
RENEWABLE ENERGY DIVISION INVESTMENT APPROACH • New investments must fulfil the following criteria: 1) Attractive project IRR (varies between markets) 2) Project manageability 3) Project bankability 4) Project risk acceptability • Avoid herd instinct. • Strict investment discipline.
Slide 58: Packaging
PACKAGING
Slide 59: Packaging Division
PACKAGING DIVISION Mission statement “To become a leading provider of innovative, environmentally sustainable, safe and competitive packaging solutions” The division currently manufactures and sells paper bags, flexible packaging products, and stickers and labels. Global trends • Consumers and our c
Slide 60: Packaging Division Differentiating Strategy
PACKAGING DIVISION DIFFERENTIATING STRATEGY • We develop packaging solutions that promote the use of ONLY fully recyclable materials (e.g. paper and mono-family plastic materials). • Malaysia’s first and only manufacturer that only uses 100% toluene-free print ink and solvent-free lamination process
Slide 61: Packaging Division State-of-Art Machinery
PACKAGING DIVISION STATE-OF-ART MACHINERY Fuji Kikai Printing Machine Fuji Kikai 14 colours Rotogravure Printing Machine
Slide 62: Packaging Division State-of-Art Machinery
PACKAGING DIVISION STATE-OF-ART MACHINERY Super Combi 5000 Super Combi 5000 Lamination Machine
Slide 63: Packaging Division State-of-Art Machinery
PACKAGING DIVISION STATE-OF-ART MACHINERY Flat Handle Paper Bag Machine Twisted Handle Paper Bag Machine
Slide 64: Packaging Division State-of-Art Machinery
PACKAGING DIVISION STATE-OF-ART MACHINERY SOS Machine Flat & Satchel Bag Machine
Slide 65: Packaging Division State-of-Art Machinery
PACKAGING DIVISION STATE-OF-ART MACHINERY Reifenhauser LLDPE Line Vacuum Metallizer Slitter for Metallized Film
Slide 66: Packaging Division State-of-Art Machinery
PACKAGING DIVISION STATE-OF-ART MACHINERY Reifenhauser LLDPE Line Vacuum Metallizer
Slide 67: Packaging Division State-of-Art Machinery
PACKAGING DIVISION STATE-OF-ART MACHINERY Bruckner OPP Line High Capacity Roll Slitting and Winding Machine
Slide 68: Packaging Division Product Range
PACKAGING DIVISION PRODUCT RANGE
Slide 69: Packaging Division Product Range
PACKAGING DIVISION PRODUCT RANGE
Slide 70: Packaging Division Product Range
PACKAGING DIVISION PRODUCT RANGE
Slide 71: Packaging Division Financial Highlights
PACKAGING DIVISION FINANCIAL HIGHLIGHTS
Slide 72: Resources
RESOURCES
Slide 73: Resources Division Profile
RESOURCES DIVISION PROFILE • Largest quicklime producer in Malaysia with 1,960 tonne per day installed kiln capacity. • Owned one of the largest limestone reserves, sufficient for more than 100 years supply. • Wide industrial applications: steel, mining, pulp and paper, agriculture, construction mat
Slide 74: Resources Division Success Factors
RESOURCES DIVISION SUCCESS FACTORS • Fully integrated facilities • Own high purity limestone reserves, on-site and at vicinity • High and consistent lime quality • Cost leadership • Diversified customer base
Slide 75: Resources Division Mission & Financial Highlights
RESOURCES DIVISION MISSION & FINANCIAL HIGHLIGHTS Mission • To be the leading lime producer in the region • 2015-2018: Completed massive expansion plan. +160% increase in kiln capacity 760 tonnes 1,960 tonnes per day • Current plant utilisation rate approx. 70% Financial Highlights
Slide 76: Investment in Joint Venture Edenor Technology
INVESTMENT IN JOINT VENTURE EDENOR TECHNOLOGY
Slide 77: Investment in Joint Venture Edenor Technology
INVESTMENT IN JOINT VENTURE EDENOR TECHNOLOGY • A 50:50 JV between MFCB and 9M Technology Sdn Bhd (RM40 million paid up capital). • Set up to acquire Emery’s Asia Pacific oleochemical business from Sime Darby Plantation Berhad and PTT GC International Limited (“Acquisition”). • The Acquisition was c
Slide 78: Emery's Asia Pacific Business
INVESTMENT IN JOINT VENTURE EDENOR TECHNOLOGY Emery’s Asia Pacific business • Integrated 300,000-tonne per annum capacity oleochemical complex on a 34-acre site at Telok Panglima Garang. • Original plant cost: > RM1.1 billion • Plant book value @ 31 Oct 2021: approx. RM430 million • Plant Acquisitio
Slide 79: Edenor Technology Plant Site
EDENOR TECHNOLOGY PLANT SITE
Slide 80: Edenor Technology Plant Layout
EDENOR TECHNOLOGY PLANT LAYOUT
Slide 81: Edenor Technology TPG Plant
EDENOR TECHNOLOGY TPG PLANT
Slide 82: Investment in Joint Venture Turnaround Strategy
INVESTMENT IN JOINT VENTURE TURNAROUND STRATEGY • Full set of new management team in place. • Major cultural and operational transformation underway. Key turnaround strategies • Simplify management processes: leaner, and more responsive and effective. • Revamp purchasing, lower cost of goods/service
Slide 83: Food Security
FOOD SECURITY
Slide 84: Food Security Division
FOOD SECURITY DIVISION “RESPECT NATURE, WORK WITH NATURE” • Water and irrigation key to sustainable cultivation: 1) Protect and improve O’plai River catchment areas to collect and store rainwater; 2) Development wetland pockets, creation of mini lakes along extensive riparian corridors. • Developmen
Slide 85: Food Security Division
FOOD SECURITY DIVISION • MFCB obtained approval from the Royal Government of Cambodia for the concession of a plot of land measuring 6,428 hectares situated in Mondulkiri Province, Kingdom of Cambodia for agricultural development. • The term of the concession is 50 years, commencing from 29 April 20
Slide 86: Food Security Division Cambodia
FOOD SECURITY DIVISION CAMBODIA
Slide 87: Food Security Division Cambodia
FOOD SECURITY DIVISION CAMBODIA
Slide 88: Food Security Division Cambodia
FOOD SECURITY DIVISION CAMBODIA
Slide 89: Food Security Division Cambodia Malaysia
FOODFOOD SECURITY SECURITY DIVISION CAMBODIA MALAYSIA
Slide 90: Food Security Division Malaysia
FOOD SECURITY DIVISION MALAYSIA
Slide 91: Food Security Division Malaysia
FOOD SECURITY DIVISION MALAYSIA
Slide 92: Food Security Division Malaysia
FOOD SECURITY DIVISION MALAYSIA
Slide 93: Food Security Division Malaysia
FOOD SECURITY DIVISION MALAYSIA
Slide 94: Food Security Division Malaysia
FOOD SECURITY DIVISION MALAYSIA
Slide 95: Thank You!
THANK YOU!
Mega First Corporation Berhad — Q3 2024 Earnings Presentation on 6ix