Nordic Group Limited · SGX:MR7

Nordic — 2Q2018 Earnings Presentation

28 slides from Nordic's earnings presentation, Aug 20, 2018

  1. Slide 1: Nordic Group Limited 2Q2018 Results Briefing

    Building Momentum, Capturing Opportunities Nordic Group Limited 2Q2018 Results Briefing 20 August 2018 www.n o rdicgro uplimited .co m 1

  2. Slide 2: Disclaimer

    Disclaimer • This presentation (this “Presentation”) has been prepared by Nordic Group Limited (“Nordic” or the “Company”) for information purposes only and has not been independently verified. It is not the intention to provide, and you may not rely on this Presentation as providing, a complete or

  3. Slide 3: Outline

    Outline 1. Financial Review 2. Business Outlook 3. Investment Merits 3

  4. Slide 4: Key Highlights

    Key Highlights 2Q2018 Revenue + 8% to S$26.1 million 2Q2018 Net Profit + 17% to S$4.4 million 1H2018 Revenue + 11% to S$48.8 million 1H2018 Net Profit +19% to S$7.8 million Outstanding Order Book (including maintenance contracts) of S$96.3 million. 2018 Contract Winning Momentum of S$46.6 million Ne

  5. Slide 5: Financial Review

    Financial Review Unaudited Unaudited Change Unaudited Unaudited Change S#039;000 1H2018 1H2017 (%) 2Q2018 2Q2017 (%) Revenue 26,075 24,047 8 48,783 43,970 11 Gross Profit 7,159 8,064 (11) 14,004 14,168 (1) Gross Profit Margin (1) 27.5% 33.5% (6)ppts 28.7% 32.2% (3.5)ppts Net Profit after Tax 4,351 3,72

  6. Slide 6: Financial Review: Revenue and Profit Margin

    Financial Review Revenue and Profit Margin 100 40 90 1.4 35 34 33 80 32 31 30 29 70 28 27 26 26 53.5 25 60 24 50 20 58.9 60.5 20 3.8 48.4 57.4 17 17 1.4 40 44.1 16 16 15 15 15 13 26.9 30 39.9 27.5 11 10 3.8 9 20 8 36.6 14.4 13.5 5 10 4 17.8 21.6 21.4 18.1 16.2 15 15.1 9.9 9.6 8.8 0 0 FY2011 FY2012 F

  7. Slide 7: Sale of Carbon Allowances

    Financial Review Sale of Carbon Allowances Unaudited Unaudited S#039;000 Total 2Q2018 1Q2017 Proceeds less management 3,787 1,387 5,174 fees Cost including transaction (3,614) (893) (4,507) fees Gains 173 494 667 ROI 4.5% 35.6% 12.9% All carbon allowances are sold and proceeds from such sale were recei

  8. Slide 8: Revenue and Profit Margin Excluding Carbon Allowances

    Financial Review Revenue and Profit Margin Excluding Carbon Allowances Unaudited Unaudited Unaudited Unaudited Change Change S#039;000 1H2018 1H2017 2Q2018 2Q2017 Revenue 22,288 24,047 (1,759) 44,996 42,583 2,413 Gross Profit Margin 31.3% 33.5% (2.2)ppts 30.7% 32.1% (1.4)ppts Net Profit Margin 18.7% 15

  9. Slide 9: Revenue breakdown by segment

    Financial Review Revenue breakdown by segment Unaudited Unaudited Change Unaudited Unaudited Change S$ ‘000 2Q2018 2Q2017 (%) 1H2018 1H2017 (%) Project Services 13,491 14,443 (7) 26,855 27,504 (2) Maintenance Services 8,797 9,604 (8) 18,141 15,079 20 Others 3,787 - 3,787 1,387 173 nm Total 26,075 24

  10. Slide 10: Revenue Breakdown by Segment

    Financial Review Revenue Breakdown by Segment 2Q2017 2Q2018 1H2017 1H2018 1.4, 3% 3.8, 8% 3.8, 14% 9.6 , 42% 15.1 , 34% 18.1 , 13.5 , 52% 37% 26.9 , 14.4, 58% 8.8 , 34% 27.5 , 63% 55% Project Maintenance Carbon allowances • Revenue from Maintenance Services is boosted by contributions from Ensure 10

  11. Slide 11: Projected CAGR – for Illustrative Purposes only

    Projected CAGR – for Illustrative Purposes only Target Net Profit 30 25 20 15 10.5 26.3 21.9 10 15.3 12.7 5 10.5 7.9 7.8 6.1 4.6 1.8 0 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 Actual Projected Note: CAGR projection is based on our internal target net profit growth of 20%

  12. Slide 12: Balance Sheet Highlights

    Financial Review Balance Sheet Highlights Unaudited as at Audited as at S#039;000 30 June 2018 31 December 2017 Current Assets (1) 96,133 99,041 Non-current Assets 58,122 52,268 Current Liabilities (2) 59,602 57,922 Non-current Liabilities 13,709 16,773 Total Equity 80,944 76,614 Cash and Cash Equivale

  13. Slide 13: Financial Review: Borrowings and Net Gearing

    Financial Review As at end of 30 June S$’000 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 2018 Total Borrowings 26,834 21,539 25,320 32,155 28,085 46,612 50,684 Cash and Cash 23,965 14,852 32,799 35,566 32,325 40,291 40,460 Equivalents Net Debt/(Cash) 2,869 6,687 (7,479) (3,411) (4,240) 6,321 10,224 Ne

  14. Slide 14: Order Book Summary

    Financial Review Order Book Summary (S$’m) 60 50.4 49.8 50 48.3 46.5 39.7 39.2 40 30 30.9 30 21.6 19.4 20 10 0 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 30-Jun-18 - Project - Maintenance Note: The order book from FY2011 to FY2016 does not include maintenance contracts as they do not have a co

  15. Slide 15: Recent Contract Winning Momentum

    Financial Review Recent Contract Winning Momentum July 17, 2018 - Total value: S$13.0m  Scaffolding and Insulation: ad-hoc contracts for scaffolding and insulation works from repeat customers  Petrochemical and Scaffolding : contracts from new customer for the provision of manpower and equipment f

  16. Slide 16: Sale of Properties

    Sale of Properties • 42 Tech Park sold on 12 Jan 2018 at $3.425m. Valuation: $3.3m • 5 Kwong Min Road: JTC approved sale in August 2018. Offer price: $2.425m. Valuation: $2m • 24 Benoi Place (land area: 39,052 sq ft; gross floor area: 45,090 sq ft; current market value: $5.8 million; Tenure: 13 year

  17. Slide 17: Business Outlook: Upstream Oil & Gas

    Business Outlook 31/7/2017 31/7/2018 Global 2110 2251 Asia 194 229 Source: Baker Hughes Oil Rig Count, Bloomberg, 16 August 2018 Source: Brent Crude 5-Year Chart , Macro trends, 16 August 2018 Upstream Oil & Gas Outlook • Despite ongoing trade war between US and China impacting global commodity pric

  18. Slide 18: Business Outlook: Marine & Shipbuilding

    Business Outlook 31/7/201 30/6/201 Monthly 7 8 Total No. of New 34 62 Build Orders Legend: Number of Vessels V Total DWT Source: Global New Build Orders, E World Ship, June 2018 Marine & Shipbuilding Outlook • Total number of new build orders have almost doubled from 34 vessels to 62 vessels over ap

  19. Slide 19: General Business Outlook

    Business Outlook General Business Outlook • Nordic Group serves largely the marine, oil and gas industries whose operating environment and business conditions remained challenging. • Sustainability of oil price recovery, • Fluctuations in the exchange rate of the US dollar against the Singapore doll

  20. Slide 20: Acquisition Track Record

    Acquisition Track Record 2011 2015 2017 Multiheight Austin Energy Ensure Engineering • Acquired for around S$29m • Acquired for around S$26m • Acquired for around S$17m • Design, erection, • Specialize in thermal • Specialize in engineering modification dismantling insulation, fireproofing and repai

  21. Slide 21: Diversified Model – Improved Earnings Quality

    Diversified Model – Improved Earnings Quality Revenue Contribution by Businesses FY2017 1H2018 FY2016 1.4, 2% 3.8, 8% 6.3, 13% 12.5, 11.9, 13% 12.3, 13% 21.8, 6.8, 14% 15% 27% 15.6, 17% 9.3, 19% 19.2, 21% 17.4, 30.3, 11.4, 23% 21% 37% 31.1, 34% 11.2, 23% System Integration / MRO & Trading Scaffoldin

  22. Slide 22: Diversified Model – Revenue Contribution by Industry

    Diversified Model – Improved Earnings Quality Revenue Contribution by Industry FY2016 1H2018 FY2015 FY2017 6% 6% 3% 2%3% 3% 3% 7% 4% 4% 4% 20% 4% 20% 4% 4% 6% 8% 36% 3% 5% 7% 6% 50% 5% 31% 3% 7% 42% 41% 53% Onshore/Downstream Marine/Upstream Electronics Manufacturing System Onshore/Infrastructure An

  23. Slide 23: Investment Merits

    Investment Merits Established Market Player Healthy Order Book Strong track record, performing above Order book of approximately S$96.3 industry average million on hand, including maintenance contracts. Contract winning momentum of S$46.6 million Established Management secured up to 17 July 2018. wi

  24. Slide 24: Investment Scorecard

    Investment Scorecard 2Q2018 1Q2018 FY2017 FY2016 FY2015 FY2014 FY2013 Share price (cents) 0.495 0.55 0.56 0.25 0.19 0.11 0.11 Market Capitalisation 196 216 220 98 75 43 42 EPS (cents) 4(4) 4 (4) 3.9 3.2 2.6 2.0 1.5 PE Ratio 12.38(4) 13.75(4) 14.36 7.81 7.27 5.40 7.07 Dividend Yield 2.93 2.77 2.73 5.

  25. Slide 25: Dividend Payout

    Dividend Payout Final / Interim / Amount per share Payment date Financial Year Payout ratio Special (cents) 5 Sep, 2018 2018 Interim 0.779 May 14, 2018 Final 0.873 2017 Sep 5, 2017 Interim 0.653 May 12, 2017 Final 0.731 40% 2016 Sep 2, 2016 Interim 0.5372 May, 13 2016 Final 0.65 2015 Sep 8, 2015 Int

  26. Slide 26: Nordic’s Share Buyback

    Nordic’s Share Buyback Share Buyback Mandate (renewed on 26 April 2018 – AGM): CUMULATIVE % OF TOTAL NO OF MONTH OF ACQUISITION QUANTITY CUMULATIVE VOLUME ISSUED SHARES ** Share Buyback by way of Market Acquisition January 2016 479,000 5,148,200 1.29 March 2016 352, 000 5,500,200 1.37 April 2016 397

  27. Slide 27: Directors’ and Executive Officer’s Share Purchases

    Directors’ and Executive Officer’s Share Purchases 9 November 2010 – IPO : Director No. of shares held % shareholdings Chang Yeh Hong 200,480,625 50.12% Eric Lin Choon Hin 43,500,000 10.88% Dorcas Teo Ling Ling 29,000,000 7.25% 272,980,625 68.25% 21 June 2018 : Director / Executive Officer No. of sh

  28. Slide 28: Thank You

    Building Momentum, Capturing Opportunities Thank You For more information, please contact Financial PR Pte Ltd Investor Relations Consultants Romil Singh / Colin Lum romil@financialpr.com.sg Tel: (65) 6438 2990 Fax: (65) 6438 0064 www.n o rdicgro uplimited .co m 28

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