Slide 1: 4Q'2017 and FY2017 Results Presentation
4Q’2017 AND FY2017 RESULTS PRESENTATION Saturday, 24 February 2018 1 1
Slide 2: Agenda
AGENDA 1. CORPORATE OVERVIEW 2. CORPORATE HIGHLIGHTS 3. FINANCIAL RESULTS 4. OUTLOOK & STRATEGIES 2 2
Slide 3: Corporate Overview
CORPORATE OVERVIEW © 2012 PRIVATE & CONFIDENTIAL 3 3
Slide 4: Serial System at a Glance
SERIAL SYSTEM AT A GLANCE The largest One of Asia Pacific’s electronic largest electronic component distribution network distributor listed on SGX Electronic Total Shares: Components 896 million (96%)* FY2017 FY2016 Free Float: 41% Market Capitalisation: S$156.8M SERIAL Hong Kong 62% 61% (As at 23 F
Slide 5: Extensive Network & Diversified Business
EXTENSIVE NETWORK & DIVERSIFIED BUSINESS Supporting a network of global brands, Serial System is a leading distributor of electronic components in Asia and fast-growing dealer for a variety of consumer goods. It is also a strategic investor in businesses in the F&B, Healthcare, Industrial Laundry, M
Slide 6: Partnering Leading Suppliers
PARTNERING LEADING SUPPLIERS Electronic Components Distribution … more than 90 Franchised Product Lines in Serial Group 6 6
Slide 7: Partnering Leading Suppliers
PARTNERING LEADING SUPPLIERS Consumer Products Distribution 7 7
Slide 8: Other Businesses - Part of Group's diversification
OTHER BUSINESSES - Part of Group’s diversification into investment holding of high-margin companies Serial MultiVision Pte. Ltd. Contract Sterilization Services Pte Ltd (100%-stake) (100%-stake) Core businesses: hospitality solutions Assembly and distribution of medical devices Hospitality sol
Slide 9: Strategic Investment – South Pacific Laundry
STRATEGIC INVESTMENT – South Pacific Laundry 27.34% stake in SPL Holdings (Australia) Pty Ltd, a nationwide laundry provider in Australia, servicing the hospitality industry (hotels, resorts, hospitals, care centres, and restaurants) in Melbourne, Sydney, Brisbane, Cairns, Canberra, Adelaide, Perth
Slide 10: Strategic Investment - Tong Chiang Group
STRATEGIC INVESTMENT - Tong Chiang Group 21% stake in food manufacturer and caterer Tong Chiang Group (“TCG”) TCG comprises 14 wholly-owned subsidiaries and three separate property investment holding entities, operating in five factories and three warehouse units in Singapore Products and services c
Slide 11: Strategic Investment – Musang Durian Frozen Food
STRATEGIC INVESTMENT – Musang Durian Frozen Food (M) Sdn. Bhd. The Group has an effective 27.5% stake in durian processing and distribution company Musang Durian Frozen Food (M) Sdn. Bhd. Operates in 2 sites: Kuala Lumpur, Malaysia (office and warehouse) and Pahang, Malaysia (GMP-certified processin
Slide 12: Corporate Highlights
CORPORATE HIGHLIGHTS © 2012 PRIVATE & CONFIDENTIAL 12 © 2011 A.S. LOUKEN BRANDING PTE LTD. PRIVATE & CONFIDENTIAL | 12 12
Slide 13: Corporate Highlights: Electronic Components Distribution
CORPORATE HIGHLIGHTS CORPORATE DEVELOPMENTS June 2017 Proposed spin-off of Serial Microelectronics (HK) Limited (“SMHK”) SMHK group to be listed on main board of the Stock Exchange of Hong Kong Limited ELECTRONIC COMPONENTS DISTRIBUTION Strategies : Expand Product Portfolio & Increase High-Value C
Slide 14: Corporate Highlights: Consumer Products Distribution
CORPORATE HIGHLIGHTS CONSUMER PRODUCTS DISTRIBUTION Strategies : Rationalise Operations and Explore New Profitable Investments April 2017 Entered into a conditional sale and purchase agreement (“SPA”) to acquire 70% of the issued and paid-up capital of Print IQ Singapore Pte. Ltd. (“Print IQ”) Dispo
Slide 15: Corporate Highlights: Other Businesses
CORPORATE HIGHLIGHTS OTHER BUSINESSES Strategies : Diversify Risk and Generate Recurring Income August 2017 Entry into JV agreement to incorporate Bast Investment Pte Ltd, which has a 50% stake in issued and paid-up capital of Musang Durian Frozen Food Sdn Bhd Musang Durian is engaged in the manufac
Slide 16: Financial Results
FINANCIAL RESULTS 16 16
Slide 17: Snapshot of 4Q2017 & FY2017 Performance
SNAPSHOT OF 4Q2017 & FY2017 PERFORMANCE Change Change US$’000 4Q2017 4Q2016 FY2017 FY2016 (%) (%) Sales 390,100 344,949 13 1,492,204 1,402,583 6 Gross Profit 28,380 25,637 11 105,119 97,393 8 Gross Profit Margin (%) 7.3 7.4 (0.1 pt) 7.0 6.9 0.1 pt Net Profit After Tax 358 4,048 (91) 9,550 4,558 110
Slide 18: 4Q2017 Highlights
4Q2017 HIGHLIGHTS • Revenue of US$390.1M, an increase of 13% compared to US$344.9M in 4Q2016 Revenue from electronic components distribution business up 14% to US$372.5M, due to higher sales in all markets except South Asia Revenue from consumer products distribution business down 6% to US$16.0
Slide 19: FY2017 Highlights
FY2017 HIGHLIGHTS • Revenue of US$1.5B, an increase of 6% from FY2016 Electronic components distribution business rose 17% to US$1.43B on higher revenue contributions from Hong Kong, China, Taiwan and South Asia Consumer products distribution business declined 69% to US$55.4M due to lower overal
Slide 20: Revenue Growth Trend – Serial System Group
REVENUE GROWTH TREND – SERIAL SYSTEM GROUP Revenue (US#039; million) 1,600.0 1,492 1,403 1,400.0 1,222 1,200.0 6% 1,036 15% 1,000.0 18% 817.1 800.0 27% 658.1 616.4 545.0 24% 600.0 7% 395.2 390.1 400.0 353.6381.9 13% 332.8 378.6 346.3 344.9 332.9 373.9 315.3 227.7 43% 185.6184.5182.9 200.0 8% 13% 92.0 4
Slide 21: Outperforming the Industry
OUTPERFORMING THE INDUSTRY Asia Pacific (including Japan) Semiconductor Revenue (US#039; billion) Serial System Revenue (US#039; million) 300 284 1,600 1,492 1,403 1,400 250 241 229 232 1,222 207 209 1,200 205 205 18% 1,036 6% 200 1,000 4% 15% 817 150 1% 800 18% 658 616 27% 9% 545 600 100 2% 24% 400 -0.9%
Slide 22: Revenue: Hong Kong & China
REVENUE Hong Kong & China Revenue (US#039; million) 1,200.0 1048.6 1,000.0 853.4 800.0 23% 661.8663.0 600.0 29% 461.4 0.2% 400.0 370.2 344.1 322.3 43% 267.5282.9284.1 242.4 219.0 25% 217.8224.8 214.2 180.8196.3 168.4 200.0 115.9 8% 81.0 57.0 31.8 17% 3.4 14.4 - FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 F
Slide 23: Profitability: Gross Profit & Margin
PROFITABILITY Gross Profit & Gross Profit Margin (US#039; million) 10.0% 9.5% 120.0 9.3% 9.3% 9.0% 8.7% 9.0% 8.7% 105.1 97.4 100.0 8.0% 91.5 7.4% 7.2% 90.4 7.3% 7.0% 7.1% 7.0% 6.9% 6.7% 6.6% 7.0% 7.5% 80.0 73.5 6.0% 6.7% 8% 62.6 5.0% 57.5 60.0 50.7 6% 4.0% 1% 40.0 3.0% 33.4 23% 25.6 26.1 28.4 24.9 24.0
Slide 24: Profitability: Net Profit & Margin
PROFITABILITY Net Profit & Net Profit Margin (US#039; million) 18.0 2.2% 2.5% 16.0 1.6% 2.0% 1.6% 14.0 1.3% 1.4% 1.2% 1.5% 12.0 1.1% 1.2% 16.1 0.9% 0.9% 12.0 0.9% 0.8% 0.8% 10.0 11.2 0.6% 1.0% 10.1 0.3% 8.0 11.0 44% 0.1% 0.5% 7.9 9.6 6.0 -31% 110% 0.0% 4.0 5.1 4.6 3.8 4.0 41% 3.3 3.4 -0.5% 2.0 -59% 2.7
Slide 25: Profitability: EBITDA
PROFITABILITY EBITDA (US#039; million) 35.0 30.8 30.0 26.0 26.1 25.0 23.5 22.0 11% 20.2 19.9 20.0 18.9 -9% -16% 15.0 40% 10.0 8.8 16% 8.6 8.9 7.9 7.8 7.7 6.3 4.3 5.0 -51% - FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 (1.8) (5.0) 25 25
Slide 26: Financial Position: Current Ratio
FINANCIAL POSITION Maintaining Healthy Current Ratio 500.0 1.6 1.5 468.6 1.4 1.4 450.0 430.6 1.4 1.3 400.0 397.5 382.61.2 1.2 1.2 372.0 1.2 1.2 350.0 347.8 324.1 295.6 1.0 300.0 277.0 250.0 0.8 218.3 211.5 218.7 200.0 173.8 0.6 147.5 147.0 150.0 120.7 0.4 100.0 0.2 50.0 - - FY10 FY11 FY12 FY13 FY14
Slide 27: Financial Position: Net Gearing Ratio
FINANCIAL POSITION Net Gearing Ratio 140% 166.5 160.0 116% 145.0 120% 138.0 139.3 140.0 124.8 115% 122.2 112% 89% 120.2 100% 120.0 119.4 104.5 110.0 98% 100.0 98.7 72% 97.9 80% 86.5 80.0 71.2 54% 60% 60.0 43% 56.3 40% 40.0 37.6 20% 20.0 - 0% FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 Shareholders' Equi
Slide 28: Financial Position: Cash Conversion Cycle
FINANCIAL POSITION Cash Conversion Cycle (days) 75 70 69 70 67 65 62 66 58 60 61 56 58 60 55 55 53 51 51 49 51 50 44 45 41 42 40 36 33 40 35 35 38 38 32 33 31 30 33 33 32 30 25 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 Trade Receivable Turnover (days) Trade Payable Turnover (days) Inventory Turnover (
Slide 29: Dividend Yield
DIVIDEND YIELD Total Dividend Payout 0.29 0.46 4.6% FY17 (In Cent (SGD)) 2.4% (Interim & Final) each year FY16 0.18 0.17 0.35 0.50 6.3% FY15 8.0% FY14 0.30 0.75 0.24 0.25 0.30 6.3% FY13 0.22 0.30 5.0% FY12 7.9% FY11 0.30 0.16 0.33 0.28 0.67 6.1% FY10 8.5% FY09 0.13 0.38 Interim Special Final FY08 0.
Slide 30: Outlook & Strategies
OUTLOOK & STRATEGIES 30 30
Slide 31: Industry Outlook
INDUSTRY OUTLOOK According to Gartner, worldwide semiconductor revenue is slated to reach US$451 billion this year, 7.5% more than in 2017, driven by strong demand for DRAM and NAND flash memory products. Firm demand for integrated circuits used for state-of-the-art smartphones and consumer electron
Slide 32: Group Outlook
GROUP OUTLOOK • The Group will spin off its Hong Kong electronic components distribution entity, Serial Microelectronics (HK) Limited group (“SMHK group”) through a listing on the mainboard of the Stock Exchange of Hong Kong Limited. • The proposed listing will enable the SMHK group to independently
Slide 33: Our Three-Pronged Strategy
OUR THREE-PRONGED STRATEGY Objectives: - Increase revenue - Drive greater internal efficiencies to improve margins - Deepen value proposition Deepen penetration in Improve internal Expand product existing markets & efficiencies to achieve portfolio & increase widen geographical greater economies hig
Slide 34: Forward-looking statements disclaimer
The presentation herein may contain forward-looking statements by the management of Serial System Ltd (“Serial System”) that pertain to expectations for financial performance of future periods versus past periods. Forward–looking statements involve certain risks and uncertainties because they relate
Slide 35: Thank You
Thank You Media and Investor Contact Information: WeR1 Consultants Pte Ltd 3 Phillip Street #12-01 Royal Group Building Singapore 048693 Tel: (65) 6737 4844 | Fax: (65) 6737 4944 Frankie Ho, frankieho@wer1.net Grace Yew, graceyew@wer1.net 35 35