Slide 1: 1Q'2018 Results Presentation
1Q’2018 RESULTS PRESENTATION Saturday, 28 April 2018 1 1
Slide 2: Agenda
AGENDA 3D CORPORATE OVERVIEW CORPORATE HIGHLIGHTS FINANCIAL RESULTS 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 Total Shares: Electronic 896 million Components (96%)* Free Float: 41% Share price S$0.167 Market Capitalisation: S$149.6M SERIAL 1Q2018 FY2017 (As at 27
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 © 2012 PRIVATE & CONFIDENTIAL 6 © 2011 A.S. LOUKEN BRANDING PTE LTD. PRIVATE & CONFIDENTIAL | 6 6
Slide 7: Partnering Leading Suppliers
PARTNERING LEADING SUPPLIERS Consumer Products Distribution © 2012 PRIVATE & CONFIDENTIAL 7 © 2011 A.S. LOUKEN BRANDING PTE LTD. PRIVATE & CONFIDENTIAL | 7 7
Slide 8: Other Businesses
OTHER BUSINESSES Part of Group’s diversification into investment holding of high-margin companies Serial MultiVision Pte. Ltd. (100%-stake) Core businesses: hospitality and healthcare solutions Hospitality solutions: Proprietary i-connect® solution, including Intelligence Room Infotainment Solut
Slide 9: Strategic Investment
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 an
Slide 10: Strategic Investment
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 can
Slide 11: Strategic Investment
STRATEGIC INVESTMENT Musang Durians Frozen Food (M) Sdn. Bhd. The Group has an effective 27.5% stake in durian processing and distribution company Musang Durians 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 ELECTRONIC COMPONENTS DISTRIBUTION • Announced proposed spin-off of Serial Microelectronics (HK) Limited CORPORATE June (“SMHK”) DEVELOPMENTS 2017 SMHK group to be listed on main board of the Stock Exchange of Hong Kong Limited In connection with the HK listing, the Group re
Slide 14: Corporate Highlights: Consumer Products Distribution
CORPORATE HIGHLIGHTS CONSUMER PRODUCTS DISTRIBUTION CONSUMER Strategies : Rationalise Operations and Explore New PRODUCTS Profitable Investments DISTRIBUTION April • Disposed of 100% equity interest in JEL Distribution (Kazakhstan) 2017 LLP • Restructured Serial I-Tech Singapore, Serial I-Tech Middl
Slide 15: Corporate Highlights: Other Businesses
CORPORATE HIGHLIGHTS OTHER BUSINESSES Strategies : Diversify Risk and Generate Recurring OTHER Income BUSINESSES February • Increased investment of US$1.5 million in 21%-owned associated company, Tong Chiang Group Pte. Ltd., which is engaged in food 2017 manufacturing and catering in Singapore • Ent
Slide 16: Financial Results
FINANCIAL RESULTS 16 16
Slide 17: Snapshot of 1Q2018 & FY2017 Performance
SNAPSHOT OF 1Q2018 & FY2017 PERFORMANCE Change Change US$’000 1Q2018 1Q2017 FY2017 FY2016 (%) (%) Sales 405,220 332,937 22 1,492,204 1,402,583 6 Gross Profit 31,393 23,959 31 105,119 97,393 8 Gross Profit Margin (%) 7.7 7.2 0.5 pt 7.0 6.9 0.1 pt Net Profit After Tax 5,190 2,708 92 9,550 4,558 110 (A
Slide 18: 1Q2018 Highlights
1Q2018 HIGHLIGHTS • Revenue of US$405.2M, an increase of 22% compared to US$332.9M in 1Q2017 Revenue from electronic components distribution business up 23% to US$386.5M, due to higher sales in all markets except South Asia Revenue from consumer products distribution business up 3% to US$17.6M d
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
REVENUE GROWTH TREND SERIAL SYSTEM GROUP Revenue (US#039; million) 1,600.0 1,492 1,403 1,400.0 1,222 6% 1,200.0 1,036 15% 1,000.0 18% 817.1 800.0 658.1 27% 616.4 600.0 545.0 24% 373.9 395.2 390.1 405.2 381.9 7% 400.0 353.6 332.9 315.3 13% 227.7 185.6 184.5 182.9 43% 200.0 92.0 22% 43.7 8% - 20 20
Slide 21: Outperforming the Industry
OUTPERFORMING THE INDUSTRY Asia Pacific (including Japan) Semiconductor Revenue (US#039; billion) Serial System Revenue (US#039; million) 300 285 1,600 1,492 1,403 1,400 250 241 229 232 1,222 207 209 1,200 205 205 19% 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: Profitability: Gross Profit & Margin
PROFITABILITY Gross Profit & Gross Profit Margin (US#039; million) 10.0% 9.3% 9.5% 120.0 9.3% 9.0% 8.7% 9.0% 8.7% 105.1 7.7% 100.0 8.0% 7.5% 97.4 90.4 7.0% 7.2% 7.3% 7.0% 6.9% 6.7% 7.0% 91.5 80.0 73.5 6.0% 8% 62.6 5.0% 57.5 60.0 6% 50.7 4.0% 1% 40.0 3.0% 33.4 23% 26.6 28.4 31.4 24.0 26.1 2.0% 17% 20.0
Slide 23: Profitability: Net Profit & Margin
PROFITABILITY Net Profit & Net Profit Margin 18.0 (US#039; million) 2.5% 2.2% 16.1 16.0 2.0% 14.0 12.0 1.6% 12.0 1.6% 11.2 11.0 1.3% 10.1 1.4% 1.5% 9.6 1.3% 10.0 1.2% 92% 8.0 0.9% 7.9 0.9% 0.8% 1.0% 6.0 0.6% 0.8% 5.1 44% 5.2 4.0 41% -31% 4.6 3.4 110% 2.7 3.1 0.5% 0.3% 2.0 0.4 -59% 0.1% - 0.0% FY09 FY10
Slide 24: Profitability: EBITDA
PROFITABILITY EBITDA (US#039; million) 35.0 30.8 30.0 26.0 26.1 25.0 23.5 22.0 20.2 19.9 20.0 18.9 11% 15.0 -9% 11.1 10.0 8.8 -16% 7.8 7.7 40% 6.3 4.3 5.0 16% 75% - FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 1Q17 2Q17 3Q17 4Q17 1Q18 24 24
Slide 25: Financial Position: Current Ratio
FINANCIAL POSITION Maintaining Healthy Current Ratio 500.0 1.5 1.6 1.4 1.4 468.6 468.2 450.0 430.6 1.3 1.4 382.6 397.5 1.2 388.9 400.0 1.2 1.2 1.2 1.2 372.0 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 FY1
Slide 26: Financial Position: Net Gearing Ratio
FINANCIAL POSITION Net Gearing Ratio 140% 166.5 160.0 153.7 116% 145.0 120% 138.0 139.3 140.0 124.8 129.0 122.2 112% 115% 89% 120.2 100% 120.0 119.4 104.5 110.0 98% 98.7 72% 97.9 84% 100.0 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 1Q
Slide 27: Financial Position: Cash Conversion Cycle
FINANCIAL POSITION Cash Conversion Cycle (days) 75 70 70 67 69 65 62 66 58 58 60 61 60 55 55 55 56 51 51 53 49 51 50 51 45 44 41 42 40 36 33 40 35 35 38 38 35 32 33 30 31 33 33 31 32 30 25 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 1Q18 Trade Receivable Turnover (days) Trade Payable Turnover (days) Inv
Slide 28: 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 29: Outlook & Strategies
OUTLOOK & STRATEGIES 29 29
Slide 30: Industry Outlook
INDUSTRY OUTLOOK According to Gartner, global semiconductor revenue is slated to reach US$451 billion this year. The industry achieved its highest annual growth in 14 years in 2017, with revenue up 21.7% at US$429.1 billion, driven by strong demand for memory integrated circuits, according to busine
Slide 31: Group Outlook
GROUP OUTLOOK • The Group plans to 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 listing will enable the SMHK group to raise funds for it
Slide 32: 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 portfolio existing markets & efficiencies to & increase higher-value widen geographical achieve greater
Slide 33: 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 34: 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 34 34