John Keells Holdings Plc · CSELK:JKH.N0000
John Keells — Investor Presentation (2022)
52 slides from John Keells's investor presentation, 2022
Slide 1: Investor Presentation
Investor Presentation Overview of the John Keells Group and review of FY2022 performance Version 1.0 This Investor Presentation should be read in conjunction with the JKH Annual Report 2021/22 to obtain a more comprehensive understanding of the drivers and strategies of our businesses. Please refer
Slide 2: Contents
Contents 1. Group Overview I. John Keells Group II. Industry Groups and sectors III. Shareholding structure IV. ESG 2. Industry Group Overview I. Transportation II. Consumer Foods III. Retail IV. Leisure V. Property VI. Financial Services VII. Information Technology and Plantation Services 2
Slide 3: John Keells Group: Overview
John Keells Group: Overview ▪ The John Keells Group (JKH) is the largest diversified listed conglomerate in Sri Lanka, with an operating history of over 150 years. ▪ The Group has ~7 business segments. Its anchor businesses are Leisure, Property, Transportation, Consumer Foods, Retail, and Financial
Slide 4: John Keells Group: Industry groups and sectors
John Keells Group: Industry groups and sectors 4
Slide 5: Shareholding consists of international institutional shareholders and reputed local companies
John Keells Group: Shareholding consists of international institutional shareholders and reputed local companies ▪ The shareholding structure of JKH is 99% free-float, Paints and General with ~40% foreign institutional investors. Industries Limited, 10.1% Others, 47.6% Details of key investors as at
Slide 6: Overview of ESG initiatives: Governance
Overview of ESG initiatives: Governance ▪ Multi-pronged approach to internal audits and process Shareholding Structure Board Composition (%) (%) reviews by augmenting its integrated fraud deterrent and investigation framework to foster synergy and 29 collaboration efficiencies between components tha
Slide 7: Overview of ESG initiatives: Environmental
Overview of ESG initiatives: Environmental Carbon Footprint (MT) per Rs. Water Withdrawal (m3 ) per Rs. Waste Generated (MT) per Energy Breakdown million of Revenue million of Revenue Rs.million of Revenue (%) 0.8 16 0.07 0.69 13.57 0.06 0.7 0.64 14 13.19 0.06 16 0.05 0.05 0.6 0.53 12 10.61 0.05 0.5
Slide 8: Overview of ESG initiatives: Social
Overview of ESG initiatives: Social CSR Focus Areas Health Arts and Culture Supplier Engagement • 89 suppliers engaged through supplier 1,501,595 133,322 fora Persons Benefited in 2021/22 Persons Benefited in 2021/22 • Supplier Code of Conduct in place Education Disaster Relief Economic Value Genera
Slide 9: Annual EBITDA of 2021/22 demonstrates significant growth potential
Annual EBITDA of 2021/22 demonstrates significant growth potential Recurring EBITDA 2021/22 2020/21 2019/20 2018/19* (Rs. Million) Transportation 6,141 3,610 4,375 4,598 Consumer Foods 3,485 3,318 3,366 2,864 Retail 7,549 5,523 5,108 2,988 Leisure 3,785 (3,588) 2,306 5,431 Property 7,867 (17) 641 37
Slide 10: Recurring EBITDA: for the year ended 31 March
Recurring EBITDA: for the year ended 31 March Recurring EBITDA* FY2022 FY2021 Variance Variance % (Rs. Million) Transportation 6,141 3,610 2,531 70 Consumer Foods 3,485 3,318 167 5 Retail 7,549 5,523 2,027 37 Leisure 3,785 (3,588) 7,373 205 Property 7,867 (17) 7,885 45,451 Financial Services 5,024 3
Slide 11: Key financial indicators
Key financial indicators (Rs. Million) 31 March 2022 31 March 2021 31 March 2020 Total debt excl. leases 234,701 147,197 79,615 Cash and cash equivalents 157,090 81,758 45,540 Net debt excl. leases 77,611 48,709 34,075 Net debt excl. leases/Equity (%) 23.5 20.0 14.0 Net debt/ recurring EBITDA (times
Slide 12: Portfolio evaluation 2021/22; returns vs. effective capital deployed
Portfolio evaluation 2021/22; returns vs. effective capital deployed Revenue recognition from the residential apartments Industry group Effective capital employed (%) and office floors sold to date at ‘Cinnamon Life Cinnamon Life Integrated Resort 40 Integrated Resort’ has been completed. The projec
Slide 13: Transportation: overview
Transportation: overview ▪ 42 per cent stake in SAGT – container terminal (capacity of ~2 million TEUs). ▪ Development of the WCT-1 (capacity of ~3.2 million TEUs). ▪ Leading bunkering services provider. ▪ One of the largest cargo and logistics service providers in the country. ▪ JV with Deutsche po
Slide 14: The strategic location of the Port of Colombo linking key shipping routes
The strategic location of the Port of Colombo linking key shipping routes 14
Slide 15: Development opportunities at the Port of Colombo
Development opportunities at the Port of Colombo ▪ The capacity enhancement currently ongoing at the Port of Colombo include the West Container Terminal (WCT-1) and the East Container Terminal. ▪ The WCT-1 is a deep-water terminal with a quay length of 1,400 meters, an alongside depth of 20 meters a
Slide 16: Sustained volume growth in the Port of Colombo
Sustained volume growth in the Port of Colombo 7.23 7.25 7.05 6.85 6.21 5.74 5.19 4.91 Million TEUs 4.31 2013 2014 2015 2016 2017 2018 2019 2020* 2021 *The impact from COVID-19 at the PoC was more pronounced during the first quarter of 2020/21, when the pandemic escalated in Sri Lanka and the region
Slide 17: Opportunities for growth in the Bunkering business
Opportunities for growth in the Bunkering business Port of Hambantota ▪ Strong opportunities for private bunkering service providers with infrastructure in place for inland storage of petrochemicals and a pipeline to the Port. ▪ The Port will occupy an area of 1,815 hectares and have a capacity to
Slide 18: Transportation: key performance indicators
Transportation: key performance indicators Key Performance Indicators 2017/18 2018/19 2019/20 2020/21 2021/22 SAGT volumes (TEU '000) 1,871 2,074 2,066 1,810 1,831 Transshipment: Domestic mix 80:20 81:19 81:19 87:13 86:14 Port of Colombo volumes (TEU '000) 6,446 7,132 7,241 6,800 7,351 LMS volume gr
Slide 19: Consumer Foods: overview
Consumer Foods: overview ▪ Strong market presence in Beverages, Frozen Confectionery and processed meats through 'Elephant House' and 'Keells-Krest' brands. ▪ Frozen Confectionery products including premium ice cream range 'Imorich' and the 'Feelgood' guilt-free frozen yoghurt range for customers se
Slide 20: Low consumption patterns and penetration reflects potential for sustained growth
Low consumption patterns and penetration reflects potential for sustained growth Bulk vs. Impulse Split - Regional ▪ The Bulk-Impulse mix of regional markets is highly skewed towards the Impulse markets, demonstrating the significant growth potential for the Impulse category. 8% 44% 30% 70% 92% 56%
Slide 21: Consumer Foods: key performance indicators
Consumer Foods: key performance indicators Key Performance Indicators % 2017/18 2018/19 2019/20 2020/21 2021/22 Volume Growth Beverages (CSD) (16) (25) 7 (14) 18 Frozen Confectionery (FC) (4) 10 3 (1) 17 Convenience Foods 3 7 0 (6) 12 EBITDA Margins Beverages and FC 21 18 21.2 20.3 16.8 Convenience
Slide 22: Consumer Foods: key performance indicators
Consumer Foods: key performance indicators Quarterly Performance Volume Growth 2021/22 (%) Q1 Q2 Q3 Q4 Q3+Q4 Full Year Frozen Confectionery 25 (12) 37 25 30 17 Bulk 24 (15) 34 18 25 13 Impulse 29 (5) 46 40 43 26 Beverages (CSD) 18 (14) 37 34 35 18 Convenience Foods 30 0 22 2 12 12 ▪ The Consumer Foo
Slide 23: Retail - overview
Retail - overview Supermarket Business ▪ High brand equity post the re-branding of 'Keells' – recognised as the 'Strongest Brand in Sri Lanka 2021' for the first time in its history and the 'Most Valuable Supermarket Brand 2021' by Brand Finance. ▪ As at 31 March 2022, 128 modern trade outlets uniqu
Slide 24: Rapid expansion to capitalise on low retail penetration levels
Rapid expansion to capitalise on low retail penetration levels Modern trade density – population (’000) per store - 2021 132 47 30 21.0 7.3 4.7 4.5 3.7 3.6 3.4 3.0 1.9 2.5 0.9 Source: Retail and shopper trends in the Asia Pacific, AC Nielsen ▪ Comparatively higher modern trade density – population p
Slide 25: Retail: key performance indicators
Retail: key performance indicators Key Performance Indicators Supermarkets (%) 2017/18 2018/19 2019/20 2020/21 2021/22 Same store sales growth 6.0 2.3 4.0 (8.6) 12.9 Same store footfall growth 4.1 4.5 1.8 (31.5) 4.5 Average basket value growth 1.9 (2.0) 2.2 33.4 8.0 EBITDA margin 5.3 3.6 8.0 7.6 7.8
Slide 26: Retail: key performance indicators
Retail: key performance indicators Quarterly Performance 2021/22 (%) Q1 Q2 Q3 Q4 Q3+Q4 Full Year Same store sales 39.3 (8.7) 9.5 18.9 14.2 12.9 Same store footfall 37.6 (37.2) 18.5 17.0 17.7 4.5 Average basket value 1.2 45.3 (7.6) 1.6 (3.0) 8.0 The statistics on footfall and basket values are distor
Slide 27: Leisure: overview
Leisure: overview ▪ Chain of Resort hotels in Sri Lanka ‾ 8 Resort hotels in strategic tourist destinations (1,022 rooms) ‾ 10% of the country’s 4-5 star class tourist accommodation ▪ 2 five-star city hotels in Colombo (847 rooms) ▪ 243 roomed lean luxury hotel managed by Cinnamon; ‘Cinnamon Red’ ▪
Slide 28: Round trip offering in key tourist destinations; further potential to expand the 'Cinnamon' footprint
Round trip offering in key tourist destinations; further potential to expand the ‘Cinnamon’ footprint ▪ Greater focus on asset light investment models as a part of the strategy to enhance the ‘Cinnamon’ footprint in Sri Lanka ▪ Land bank of 128 acres of freehold and 140 acres of leasehold land in ad
Slide 29: Sri Lanka is a sought-after tourist destination in the region
Sri Lanka is a sought-after tourist destination in the region Annual tourist arrivals to Sri Lanka ('000) Year (000’s) Tourist arrivals YoY Growth (%) 2,500 2010* 654 46 2015 1,798 18 2,000 2016 2,051 14 1,500 2017 2,116 3 2018 2,334 10 1,000 2019** 1,913 (18) 500 2020*** 508 (74) 2021*** 194 (62) -
Slide 30: Significant pre-pandemic growth in Asian arrivals to Sri Lanka
Significant pre-pandemic growth in Asian arrivals to Sri Lanka Tourist Arrivals 1,200,000 1,000,000 800,000 600,000 400,000 200,000 - 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019* 2020* 2021* Source: Sri Lanka Tourism Development Authority *2019, 2020 and 2021 arrivals were impacted by Easter S
Slide 31: Tourist arrivals to Sri Lanka lag well below regional peers
Tourist arrivals to Sri Lanka lag well below regional peers 45 40 35 30 Arrivals in millions 25 20 15 10 5 0 Malaysia Indonesia Thailand Vietnam Cambodia Sri Lanka 1990 2019 Source: Governmental tourism websites 31
Slide 32: Room inventory in Colombo lags far behind other popular regional capital cities
Room inventory in Colombo lags far behind other popular regional capital cities 60,000 31,790 30,114 26,113 9,100 7,600 5,019 Bangkok Manila Kuala Lampur Jakarta Ho Chi Minh Hanoi Colombo 32
Slide 33: Leisure: key performance indicators
Leisure: key performance indicators Key Performance Indicators 2017/18 2018/19 2019/20 2020/21 2021/22 Colombo Hotels* Occupancy (%) 64 48 34 3 29 ARR (USD) 127 128 100 64 70 EBITDA margin (%) 27 22 10.5 (84.8) 1.5 Sri Lankan Resorts Occupancy (%) 81 80 62 16 32 ARR (USD) 91 90 77 62 78 EBITDA margi
Slide 34: Leisure: key performance indicators
Leisure: key performance indicators Quarterly Performance 2021/22 Q1 Q2 Q3 Q4 Q3+Q4 Full Year Colombo Hotels* Occupancy (%) 6 20 39 52 45 29 ARR (USD) 61 54 71 77 74 70 EBITDA margin (%) (73) (40) 11 23 18 2 Sri Lankan Resorts Occupancy (%) 18 18 35 57 46 32 ARR (USD) 50 38 82 93 85 78 EBITDA margin
Slide 35: Property – Overview
Property – Overview ▪ Projects developed under the 'Luxe Spaces', 'Metropolitan Spaces’ and 'Suburban Spaces' verticals which cater to the luxury, mid-tier and suburban multi-family housing segments. ▪ Construction of the iconic integrated mixed-use development 'Cinnamon Life Integrated Resort' comp
Slide 36: Industry potential
Industry potential ▪ Low levels of urbanisation within Sri Lanka in comparison to regional peers ▪ Annual condominium supply far below regional peers Annual condominium supply in regional cities 53,796 38,000 2,187 KL Ho Chi Minh City Colombo Sources: KL: CBRE property market outlook 1Q 2018 (foreca
Slide 37: Low penetration of apartment living in Colombo
Low penetration of apartment living in Colombo 5% 20% 30% 36% 40% 45% 50% 90% 95% 80% 70% 65% 60% 55% 50% 10% Greater Colombo Singapore Thailand (Central Thailand (Outskirts) Malaysia (Central Malaysia (Greater India (Chennai) India (Bangalore) Bangkok) KL) KL) Apartments Landed houses Source: Compa
Slide 38: Prime land bank of over 35 acres in central Colombo
Prime land bank of over 35 acres in central Colombo ▪ Prime land bank of over 35 acres held in central Colombo ▪ One of the largest privately owned land banks ▪ Includes the ongoing ‘Cinnamon Life Integrated Resort’ project ▪ Opportunities for development at land banks held in ‘Crescat Boulevard’ an
Slide 39: Developable freehold land of approximately 25 acres in close proximity to Colombo city
Developable freehold land of approximately 25 acres in close proximity to Colombo city ▪ Greater connectivity and reduction in travel time to Colombo city post construction of the outer circular expressway. ▪ Direct connectivity to the Port City Colombo and a multi modal transportation hub to be dev
Slide 40: Robust development pipeline: Scenic 500-acre land bank with an 18-hole golf course
Robust development pipeline: Scenic 500-acre land bank with an 18-hole golf course Rajawella Holdings Limited (RHL) ▪ The 500-acre land in Digana includes an 18-hole, Donald Steel designed, Golf Course and developable land extent of approximately 80 acres ▪ Troon International has taken over the man
Slide 41: Property: key performance indicators
Property: key performance indicators Key Highlights The Residence at ‘Cinnamon The Suites at ‘Cinnamon Life Life Integrated Resort' Integrated Resort’ ▪ Revenue on the 267 units sold with regard to the residential towers at the 'Cinnamon Life Integrated Resort', has been fully recognised during 2021
Slide 42: Cinnamon Life Integrated Resort
Cinnamon Life Integrated Resort ▪ An iconic, visionary, first of its kind development with features comparable to top integrated resorts in Southeast Asia. ▪ A rich, dynamic 4.5 million sq. ft of mixed-use development in the heart of Colombo, a ‘city within a city’. ▪ Project Architect - Cecil Balmo
Slide 43: Development area and layout of 'Cinnamon Life'
Development area and layout of ‘Cinnamon Life’ Conferencing ; capacity (~5,000 pax) in five venues and car park facility (2,330 slots) 800 guest room hotel, including conferencing, banqueting, 7 speciality restaurants (~1,300 pax) and entertainment facilities The hotel and conferencing space collect
Slide 44: Aerial view of Cinnamon Life under construction
Aerial view of Cinnamon Life under construction 44
Slide 45: Aerial view of Cinnamon Life under construction
Aerial view of Cinnamon Life under construction 45
Slide 46: Aerial view of Cinnamon Life under construction
Aerial view of Cinnamon Life under construction 46
Slide 47: Cinnamon Life Integrated Resort
Cinnamon Life Integrated Resort Exhibition Centre - Level 8 Cantilever Ballroom - Level 22 External Garden – aerial view Emblem Pool Bar– Level 25 Hotel Entrance - Level 1 Premium Suite - Living/Dining Premium Suite – Bedroom Premium Suite – Bathroom 47
Slide 48: Financial Services – Overview
Financial Services – Overview ▪ Union Assurance (UA) offers comprehensive insurance solutions in the Life Insurance segment while General Insurance solutions are offered through its associate Union Assurance General Limited (UAG) • Operating footprint of 75 branches, excluding virtual locations. • A
Slide 49: Insurance: key performance indicators
Insurance: key performance indicators Key performance indicators CY2017 CY2018 CY2019 CY2020 CY2021 Market share (%) 14 14 13 13 12 GWP growth (%) 22 11 4 13 18 Recurring net profit (Rs.Mn) 4,002* 3,243 1,158 921 2,054 Surplus from Life Fund (Rs.Mn) 3,642 1,100 1,000 825 1,600 Life Fund (Rs.Bn) 29.1
Slide 50: Banking: key performance indicators
Banking: key performance indicators Key performance indicators CY2016 CY2017 CY2018 CY2019 CY2020 CY2021 Loans and advances growth (%) 23.7 25.0 19.0 2.0 (7.3) 17.7 Industry (LCB’s) (%) 17.8 15.8 20.3 4.9 13.3 13.5 Return on equity (%) 17.7 17.4 15.3 12.8 12.1 17.9 Industry (LCB’s) (%) 17.2 17.4 13.
Slide 51: Other including Information Technology and Plantation Services
Other including Information Technology and Plantation Services Information Technology Plantation Services ▪ Software solutions and consultation services ▪ Leading tea and rubber broker. based on Internet of Things (IOT), Robotic ▪ Operates six tea factories producing both CTC and Process Automation
Slide 52: THANK YOU
THANK YOU This document was produced by John Keells Holdings PLC for information purposes only. The information contained in this document are a review of the financial information pertaining to FY2022 and does not constitute an issue prospectus or a financial analysis. This Investor Presentation sh