Evergreen Fibreboard Bhd. · MYX:EVERGRN
Evergreen Fibreboard Bhd — Shareholder Meeting (May 2022)
32 slides from Evergreen Fibreboard Bhd's shareholder meeting presentation, May 2022
Slide 1: 31st Annual General Meeting
31ST ANNUAL GENERAL MEETING Briefing on FYE2021 Financial Results
Slide 2: Disclaimer
Disclaimer This corporate presentation may contain forward-looking statements. All statements other than statements of historical facts contained in this presentation. Including, without limitation, those regarding our financial position, business strategies, plans and objectives of our Group for fu
Slide 3: Table of Contents
Table of Contents About EVERGREEN Business Overview Financials Challenges Challenge Management Opportunities Strengths Looking Ahead Salient Points 3
Slide 4: About EVERGREEN
About EVERGREEN
Slide 5: EVERGREEN – A Quick Snapshot
EVERGREEN – A Quick Snapshot Started in 1972 as a timber trading and veneer manufacturing company Over 50 years, the Group has grown to a multi-product entity (e.g. veneer to laminates, to medium density fibreboard (MDF) and particleboard (PB), and then to ready-to-assemble furniture) Manufact
Slide 6: Business Overview
Business Overview
Slide 7: What We Do
What We Do RTA Medium Density Fibreboard (MDF) Furniture Value-Added 7% Manufacturing of MDF, an Products engineered wood product made by 9% breaking down wood residual into wood fibres, combining it with wax and resin binder to form panels. MDF & PB 84% Value-added products include melamine, veneer
Slide 8: Global Footprint
Global Footprint Far East Asia Africa 6% 13% Middle East 26% South Asia 1% America 10% Europe 1% Revenue Far East Far East South East Africa Asia Africa Asia Asia FYE 2021 South Asia 6% 6% 8% Middle East 43% 1% Middle South Asia 8% 24% East 1% 31% America 6% America 10% Europe 4% Europe 2% South Eas
Slide 9: Leading MDF Producer in ASEAN
Leading MDF Producer in ASEAN (‘000) MDF PB Resin RTA (m³) (m³) (MT) (m³) Hat Yai, Thailand Malaysia 320 312 160 80 MDF Manufacturing 660,000 m³ Thailand 660 - - - Power Generation 18MW Gurun, Kedah Indonesia 120 - - - Resin Manufacturing 80,000 MT Total 1,100 312 160 80 Nilai, Negeri Sembilan MDF M
Slide 10: Financials
FINANCIALS
Slide 11: FY21 Financial Performance Review
FY21 Financial Performance Review Despite longer periods of operational shutdown in Malaysia FY FY 1Q in FY2021 compared to FY2020 due to FMCO vs MCO 1.0, RM’m 2020 2021 2022 the Group’s revenue in FY2021 increased RM75.2mil Revenue 859.8 935.0 319.3 due to higher selling price and shifting of Mal
Slide 12: Resilient Financial Position to Face Challenges
Resilient Financial Position to Face Challenges RM’m 2020 2021 PPE 925.6 863.2 Cash of RM102m reinforces the sustainability of the Non-Current Assets 85.5 89.6 Group Current Assets ex Cash 318.4 367.2 Drop in cash was due to repayment in bank borrowings Cash 122.5 101.8 to reduce interest expens
Slide 13: Financial Flexibility to Pursue Growth
Financial Flexibility to Pursue Growth RM’m 2020 2021 Operating cash flows before working capital changes 90.9 111.6 The Group increased the INFLOW of operating cashflow to RM112mil before working capital Changes in working capital and (25.7) (29.0) changes despite longer lockdown due to FMCO in F
Slide 14: Challenges
CHALLENGES
Slide 15: Challenges in 2022
Challenges in 2022 MACROECONOMICS & POLICIES Higher oil, raw material prices and cost of operations Ukraine-Russia War, trade sanctions against Russia and lockdown in China due to resurgence of Covid19 Higher oil prices increases the cost of glue and logistics Insufficient log supply especia
Slide 16: Challenge Management
CHALLENGE MANAGEMENT
Slide 17: Managing Challenges: Strategies & Team Efforts
MANAGING CHALLENGES STRATEGIES & TEAM EFFORTS Responding to higher oil, raw material prices and cost of operations Work with customers to optimize selling price in view of higher input costs and to focus on premium products Improve glue and wood consumption ratio via process improvement and in
Slide 18: Opportunities
OPPORTUNITIES
Slide 19: Opportunities in 2022
Opportunities in 2022 MACROECONOMICS & POLICIES US-China Trade War US-China trade war strongly discouraged US furniture buyers to source from China Many Chinese firms are moving out from China to setup furniture plants in SEA This has benefited the Group as we can supply MDF and PB boards as
Slide 20: Strengths
STRENGTHS
Slide 21: Stability through diversity: Vertically Integrated Operations & Wide Customer Base
Stability through diversity Vertically Integrated Operations & Wide Customer Base Sustainably Integrated Operations • Manufacture adhesives for in-house needs • Experienced in managing rubber wood log harvesting concessions • Produce different kinds of engineered wood (e.g. MDF, PB, sawntimber) •
Slide 22: Stability through diversity: Diversified base of operations
Stability through diversity Diversified base of operations Manufacturing presence in Malaysia, Thailand and Indonesia Each country allows access to different markets • Malaysia – Great infrastructure, top 10 furniture exporter in world, provide big market for panel board • Thailand – Top rubber
Slide 23: Captive Market over Malaysian Furniture Industry
Captive Market over Malaysian Furniture Industry Centre of Malaysian Furniture Industry is Literally in Our Backyard Large Captive Local Market • Evergreen is a long established Malaysian panel board supplier with a strong reputation • Malaysia is top 10 furniture exporting countries in the world
Slide 24: Future Potential in Indonesian Market
Future Potential in Indonesian Market Local Presence in Indonesia Domestic Indonesian Market • Indonesia has big potential as its middle class is growing rapidly • Local furniture industry is largely undeveloped giving rise to significant future growth potential for panel boards • Sheltered from i
Slide 25: Looking Ahead
LOOKING AHEAD
Slide 26: Expected Improvements in 2H2022
Expected Improvements in 2H2022 UPCOMING IMPROVEMENTS Improving weather in Malaysia With Southwest Monsoon, the coming dry weather will improve log supply Increased capacities and demand for value-added boards Group expanding capacities of its non-raw board products which are backed by new o
Slide 27: Salient Points
SALIENT POINTS
Slide 28: Why revenue increased in 1Q2022?
SALIENT POINTS Why revenue increased in 1Q2022? Revenue increase mainly due to reactivation of idle line in Thailand and general relaxation of movement control rules in Malaysia Thailand running all 3 lines since November 2021. Cater for demand from Middle East FMCO in Malaysia was lifted in S
Slide 29: Thailand Operation – A turn-around
SALIENT POINTS THAILAND OPERATION – A turn-around Previously: In 2020, Thailand’s MDF operation faced high wood cost due to tight supply which impacted productivity and cost. Low prices from Middle East made it more practical to shutdown 1 line than sell at a loss. Thailand’s power plant suffe
Slide 30: Across-Board Improvement
SALIENT POINTS ACROSS-BOARD IMPROVEMENT Improved prospect of MDF MDF export market has seen marked improvement which continued since 2nd half of 2021 Higher average selling prices and stronger USD vs RM and THB have helped the Group’s financial performance Diversified base of operations allo
Slide 31: Balance sheet and Liquidity Management
SALIENT POINTS Balance sheet and Liquidity Management To ensure sufficient financial liquidity: Manage receivables and inventories to improve cash inflow Receivables on average maintain within 30-40 days collection period via constant monitoring Paying down both trade payables and bank facilit
Slide 32: Thank You
Thank You
Evergreen Fibreboard Berhad — Shareholder Meeting (May 2022) on 6ix