Manila Water Co. Inc. · PSE:MWC
Manila Water — H1 2019 Earnings Presentation
35 slides from Manila Water's earnings presentation, Aug 13, 2019
Slide 1: 1H 2019 Analysts' Briefing
MANILA WATER CARE IN EVERY DROP 1H 2019 ANALYSTS’ BRIEFING August 13, 2019 The Blue Room, 25F Tower One & Exchange Plaza
Slide 2: Consolidated Net Income stands at Php2.9 Bn for first half of 2019
Consolidated Net Income stands at Php2.9 Bn for the first half of 2019, 18% lower than the same period last year Manila Concession net income declined 25% to Php2.5 Bn. Nevertheless, the company continues to improve on its operations recovery, with water availability to 99% of Manila Concession’s cu
Slide 3: Consolidated Financial Performance
CONSOLIDATED FINANCIAL PERFORMANCE Consolidated revenues grew by 7%, with growth tempered by one-time Bill Waiver Program in the Manila Concession EBITDA dropped slightly by 1%, still affected by the impact of the recent water shortage in the Manila Concession Net income dropped 18% to Php2.9 Bn (in
Slide 4: Consolidated Net Income Summary
CONSOLIDATED NET INCOME SUMMARY (in Million Php) 1H 2019 1H 2018 % Change Manila Concession 2,499 3,311 (25%) Net income decline in (runeavrccy the Manila Concession wJuAGitic offset by higher Manila Water Asia Pacific contribution from domestic subsidiaries Manila Water Total Solutions (30) (61) an
Slide 5: Consolidated Costs and Expenses
CONSOLIDATED COSTS AND EXPENSES (in Million Php) 1H 2019 1H 2018 % Change COS and Operating 9 0 Expenses 4,558 3,733 22% Direct 1,822 1,599 14% Personnel 1,10 1,116 1% Overhead costs rose 3 (1% significantly; with the Overhead 1,218 598 104% effect of the Php534 Mn penalty Other expenses (recognized
Slide 6: Group Operating Results: Capital Expenditures
GROUP OPERATING RESULTS (in Million Php) 1H 2019 CAPITAL SeaenTES nese EXPENDITURES Manila Concession 2,920 Manila Water Philippine Ventures Clark Water 728 w aS Laguna Water Total CAPEX Boracay Water amounted to Estate Water Php3.7 Bn for the Others 1st half of 2019 Manila Water Total Solutions iw)
Slide 7: Consolidated Balance Sheet Highlights
CONSOLIDATED (in Million Php) 1H 2019 FY 2018 % Change BALANCE Assets 124,480 122,533 2% SH EET Liabilities 69,189 68,912 0.4% HIGHLIGHTS Equity 55,291 53,621 3% Cash and Cash 0, Equivalents 6,307 9.391 (33% Group balance sheet remained Ratios 1H 2019 FY 2018 healthy, with Total Assets at . Php124 B
Slide 8: Concession
MANILA CONCESSION
Slide 9: Concession Operating Highlights
MANILA CONCESSION OPERATING HIGHLIGHTS Billed volume declined 2% in line with the impact of the water supply shortage in the Manila Concession NRW level improved to an all-time low of 7.5% due to Efficient Network Optimization / Management Billed Volume (in mcm) Billed Connections (in ‘ooos) Average
Slide 10: Concession Financial Highlights
MANILA CONCESSION FINANCIAL HIGHLIGHTS (in Million Php) Revenues 1H 2019 8,142 1H 2018 % Change COS and Operating (2,296) Expenses MWSS Penalty (534) Additional OPEX due to Water Shortage COS and Operating Expenses (126) Revenue growth (2,956) (2,172) tempered by one-time Bill Waiver Program EBITDA
Slide 11: Service Recovery Update
MANILA Service Recovery Update CONCESSION Manila Water Company has restored 24/7 through the UPDATES successful implementation of its Water Supply Augmentation Program 24/7 March 19 to Present ne SI s @ 16 4 hours IME
Slide 12: Water supply and demand outlook
▪ ▪ 2,600 2600 2,400 2400 2,200 2200 2,000 2000 1,800 1800 1,600 1600 1,400 1400 1,200 1200 1,000 1000 2018 2018 2019 2019 2020 2020 2021 2021 2022 2022 2023 2023 "Buffer@15%" MDD ADD MLD Angat
Slide 13: Concession Water Supply Augmentation Projects
MANILA CONCESSION WATER SUPPLY AUGMENTATION PROJECTS On March 21, 2019, Manila Water signed a Raw Water Supply Offtake Agreement with MWSS and WawaJVCo, Inc. WawaJVCo is a joint venture company formed by Prime Metroline Infrastructure Holdings Corporation and San Lorenzo Ruiz Builders and Developers
Slide 14: Other Medium Term Water Supply Augmentation Projects
MANILA Other Medium Term CONCESSION Water Sources WATER SUPPLY being explored AUGMENTATION g Shp PROJECTS Proponent ater Corporation Potenti Proj Proj Water Source otential ojected ojected Remarks Volume Completion Capex exclusive to MWCI, with pre-treatment to comply Laguna Lake 300MLD 50MLD by 202
Slide 15: Statement on Supreme Court Decision
MANILA CONCESSION STATEMENT ON Department of Environment and Natural Resources SUPREME COURT Pollution Adjudication Board DECISION ¢@ According to news articles, the Supreme Court ordered MWSS and Manila Water on August 7, 2019 to jointly and severally pay Php921.46 Mn in fines for its supposed non-
Slide 16: Philippine Ventures
MANILA WATER PHILIPPINE VENTURES
Slide 17: Philippine Ventures Consolidated
MANILA WATER PHILIPPINE VE NTU RES (in Million Php) 1H 2019 1H 2018 % Change CONSOLI DATED Revenues 2,249 1,727 30% COS and Operating Expenses* Bus. Dev’t. Costs (61) (84) (28% (1,269) (1,087) 17% m ky = i=) > 980 640 5. oo x Net income increased by 31% led by Estate Water but offset by Net Income m
Slide 18: Philippine Ventures Operating and Financial Highlights
MANILA WATER PHILIPPINE VENTURES OPERATING AND FINANCIAL HIGHLIGHTS Net income increased by 31% led by Estate Water but partially offset by market challenges experienced in Clark and Boracay 1H 2019 1H2018 % Change Laguna Water Billed Volume (mem) 21.8 22.3 (2% NRW (in percentage) 19.9% (1.0 ppts. N
Slide 19: Philippine Ventures: Laguna Water
MANILA WATER PHILIPPINE VENTURES OPERATING AND FINANCIAL HIGHLIGHTS Net income increased by 31% led by Estate Water but partially offset by market challenges experienced in Clark and Boracay 1H 2019 1H2018 % Change Laguna Water Billed Volume (mem) 21.8 22.3 (2% (1.0 ppts. NRW (in percentage) 20.9% 1
Slide 20: Philippine Ventures: Estate Water
MANILA WATER PHILIPPINE VENTURES OPERATING AND FINANCIAL HIGHLIGHTS Net income increased by 31% led by Estate Water but partially offset by market challenges experienced in Clark and Boracay 1H 2019 1H2018 % Change Estate Water Billed Volume (mcm) Billed volume growth due to continued takeover of ne
Slide 21: Philippine Ventures: Boracay Water
MANILA WATER PHILIPPINE VENTURES OPERATING AND FINANCIAL HIGHLIGHTS Net income increased by 31% led by Estate Water but partially offset by market challenges experienced in Clark and Boracay 1H 2019 1H2018 % Change Billed volume decline due to permanent closure of some establishments in line with cl
Slide 22: Philippine Ventures: Clark Water
MANILA WATER PHILIPPINE VENTURES OPERATING AND FINANCIAL HIGHLIGHTS Net income increased by 31% led by Estate Water but partially offset by market challenges experienced in Clark and Boracay 1H 2019 1H2018 % Change pusdvowne(nen) esas [NRW (in percentage) 20.9% 19.9% (1.0 ppts.) [Net income (million
Slide 23: Philippine Ventures Updates: New business development
MANILA WATER . PHILIPPINE New business development efforts of MWPV have yielded notable gains in domestic market expansion VENTURES UPDATES JV agreement with Lambunao Water District for a JV agreement with Calbayog Water District for a Concession Project in Lambunao, lloilo Full Concession Project i
Slide 24: Asia Pacific
MANILA WATER ASIA PACIFIC
Slide 25: Asia Pacific Consolidated
MANILA WATER ASIA PACIFIC CONSOLIDATED Net income growth remained steady, driven by East Water's equity share in income despite challenges in Vietnam investments (in Million Php) Equity Share in Net Income of Associates COS and Operating Expenses* Bus. Dev’t. Costs EBITDA Net Income Billed Volume (m
Slide 26: Asia Pacific Operating and Financial Highlights
MANILA WATER ASIA PACIFIC OPERATING AND FINANCIAL HIGHLIGHTS Net income growth remained steady, driven by East Water's equity share in income despite challenges in Vietnam investments 1H 2019 East Water Billed Volume (mcm) 1H 2018% Change Net Income (in billion THB) Net Income @ 18.72% (in million P
Slide 27: Asia Pacific: East Water
1H 2019 1H 2018% Change MANILA WATER eieaNeinTs (mem) 192.3 56.5 3% ASIA PACIFIC ese at OPERATI NG Net Income @ 18.72% AND FINANCIAL (in million PHP) HIGHLIGHTS Net Income (in billion THB) 0.61 0.58 4% Higher net income due to higher raw water offtake of the Provincial Waterworks Authority (PWA). Hi
Slide 28: Asia Pacific: Thu Duc Water
MANILA WATER ASIA PACIFIC OPERATING AND FINANCIAL HIGHLIGHTS Net income growth remained steady, driven by East Water's equity share in income despite challenges in Vietnam investments 1H 2019 1H 2018% Change | Net incon| Lower net income due to higher raw | ae [8 water and electricity costs. = Thu D
Slide 29: Asia Pacific: Kenh Dong Water
1H 2019 1H 2018% Change MANILA WATER ASIA PACIFIC OPERATING AND FINANCIAL HIGHLIGHTS | Billed Voluny Lower net income due to | Net Income | unrecovered increase in Raw Water Tariff leading to higher direct costs. Kenh Dong Water Net income growth é Billed Volume (mcm) 29.6 remained steady, driven by
Slide 30: Asia Pacific: Saigon Water
MANILA WATER ASIA PACIFIC OPERATING AND FINANCIAL HIGHLIGHTS Net income growth remained steady, driven by East Water's equity share in income despite challenges in Vietnam investments 1H 2019 1H 2018% Change Net income decline due to lower billed volume in Tan Hiep and delayed tariff increase in Cu
Slide 31: Total Solutions
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Slide 32: Total Solutions Operating and Financial Highlights
MANILA WATER TOTAL SOLUTIONS OPERATING AND FINANCIAL HIGHLIGHTS MWTS continues on its OPEX streamlining efforts (in Million Php) 1H 2019 1H2018 % Change Revenues 165 220 (25% COS and Operating Expenses (187) (267) (30%) m ky = i=) > (22) (47) 53% Net Income (Loss) (30) (61) 51% NI contribution per s
Slide 33: Total Solutions Updates
MANILA WATER TOTAL SOLUTIONS UPDATES Py RO, Technology Options: By-products: Grant of TE“ ! Integrated Waste Original Pe U S H Management A Proponent itt) | Facility Status by —— Marikina City Power Cities/ B u i Id an d Municipalities se tioner Operate an Anaerobic Digestion Integrated Waste ; Alte
Slide 34: Consolidated Net Income stands at Php2.9 Bn for first half of 2019
Consolidated Net Income stands at Php2.9 Bn for the first half of 2019, 18% lower than the same period last year Manila Concession net income declined 25% to Php2.5 Bn. Nevertheless, the company continues to improve on its operations recovery, with water availability to 99% of Manila Concession’s cu
Slide 35: Forward-looking statements and contact
tward-looking statements” within atements (including as to plans, objectives, ation that does not relate solely to historical or ent expectations of future events, estimates, and certain anagement. These are therefore subject to certain risk factors and uncertainties, some of which are beyond the Co