Cosco Shipping Ports Limited · HKEX:1199
Cosco Shipping Ports — H1 2018 Earnings Presentation
30 slides from Cosco Shipping Ports's earnings presentation, Aug 27, 2018
Slide 1: 1H2018 Results: Growth Momentum Gathers
1H2018 Results Growth Momentum Gathers 27 August 2018
Slide 2: Content
Content CONTENT PAGE 1H2018 Financials 4-8 Operations Review 10-13 More Synergies Bigger Growth 15-17 Our Response to Market Challenges 19 Case Studies 21-23 Invest for Sustainable Growth 25-26 FY2018 Guidance 28 2
Slide 3: 1H2018 Highlights: 1H2018 Financials
1H2018 Highlights 1H2018 Financials 3
Slide 4: Strong Organic Growth Continued
Strong Organic Growth Continued Like-for-like Reported (Exclude newly acquired projects and projects under construction etc.) US$’mn 1H2018 1H2017 Change 1H2018 1H2017 Change Revenue 495.5 275.8 +79.7% 345.2 (b) 275.8 +25.2% Cost of sales 338.0 177.2 +90.7% 213.8 (b) 177.2 +20.6% Gross Profit 157.5
Slide 5: Robust Revenue Growth
Robust Revenue Growth • Strong throughput growth driven by enhanced synergies with Ocean Alliance US$495.5mn • Contributions from newly acquired projects ie Revenue Noatum, Zeebrugge Zeebrugge + 79.7% yoy 1.8% Xiamen 9.6% Million TEU 1H2018 1H2017 yoy % Nansha 15.6% Total throughput 56.7 44.8 +26.5
Slide 6: Cost Analysis
Cost Analysis Cost of Sales + 90.7% +20.6% US$338mn • Costs of sales + 20.6% on a like- Zeebrugge 2.3% for-like basis (on a like-for-like basis ) • Costs of existing subsidiaries were rather stable Noatum 34.5% • By using Navis N4, costs should further come down US$177mn • Increased in costs mainly
Slide 7: Net Profit Analysis
Net Profit Analysis US$ mn 1H2018 Change 1H2017 Net Profit 169.0 +70.1% 99.3 Terminal Profits 195.4 +54.4% 126.5 Terminal Profits – Top 10 (more subsidiaries) 1H2018 1H2017 QPI 27.1% Yantian 16.6% Yantian 11.9% QPI 10.5% • Driven by volume growth and enhanced PCT 7.0% Shanghai Pudong 8.9% efficiency
Slide 8: Continue to Strengthen Financial Position
Continue to Strengthen Financial Position US$mn 30 June 2018 30 June 2017 31 Dec 2017 Total Debt 2,307 1,420 2,334 Average cost of debt 3.41% 3.24% 3.22% Cash on hand 573 333 560 Net debt to equity 29.4% 20.1% 30.2% Interest coverage 6.91x 7.0x(a) 6.8x(a) Net asset 5,881 5,414 5,845 Total assets 9,0
Slide 9: 1H2018 Operations Review
1H2018 OperationOperations Reviews Review 9
Slide 10: Strong Growth Reaffirms Sound Strategies
Strong Growth Reaffirms Sound Strategies Equity throughput growth +22.3% Back by 1) Strong supports from parent company and Ocean Alliance 2) M&As Revenue +79.7% 3) Continue to enhance Operating profit1 efficiencies +75.8% 4) Strong network synergies EBITDA2 margin above 70% Adjusted Net profit 1 +7
Slide 11: Subsidiaries Continued to Outperform
Subsidiaries Continued to Outperform Terminal Profits * Equity throughput * Subsidiaries Subsidiaries +55.3% +34.2% Non-subsidiaries Non-subsidiaries +18.7% +3.9% * On a like for like basis (Subsidiaries exclude Nantong, Wuhan & Abu Dhabi; Non-subsidiaries exclude QPI) 11
Slide 12: Terminal Profits Analysis
Terminal Profits Analysis 1H2018 Terminal Profits: US$195.4mn Overseas S.W 16.6% Terminal Profits by Regions Coast Bohai 0.8% Rim 36.3% 70.8 Pearl US$ mn 1H2017 1H2018 River Delta 20.2% Yangtze S.E Coast River & Others Delta 39.7 39.4 7.9% 18.2% 34.9 35.6 32.5 25.9 1H2017 20.8 Terminal Profits: US$1
Slide 13: Equity Throughput Analysis
Equity Throughput Analysis 1H2018 Total Equity Throughput: 18mn TEU Bohai Overseas Rim Equity Throughput by Regions 1H2017 1H2018 28.9% 23.6% TEU’000 5,188 S.W Yangtze 4,244 Coast River 3,799 3,842 1.4% Delta Pearl 15.4% 3,439 3,117 River S.E Coast 2,776 2,764 Delta & Others 21.4% 9.3% 1,671 1,319 1
Slide 14: More Synergies Bigger Growth
1H2018 Operations More Synergies Review Bigger Growth 14
Slide 15: Continued to Enhance Synergies – Ocean Alliance
Continued to Enhance Synergies – Ocean Alliance Volume by Ocean Alliance as % of total throughput 91.20% 1H2017 1H2018 1H2017 1H2018 65.40% 64.10% Total no. of subsidiaries 62.70% 63.10% 4 6 Ocean Alliance calling 56.70% % Ocean Alliance 49.3% 52.9% throughput 45.80% 39.40% 32.80% % of Ocean Allianc
Slide 16: Continued to Enhance Synergies – COSCO SHIPPING
Continued to Enhance Synergies – COSCO SHIPPING Volume by COSCO SHIPPING as % of total throughput 1H2017 1H2018 • Throughput from COSCO SHIPPING accounted for about 23% of total subsidiaries 65.00% • Will continue to strengthen the synergy 51.00% 46.00% 46.00% 34.00% 38.00% 28.00% 29.00% 20.00% 15.0
Slide 17: More Synergies are Expected – OOCL
More Synergies are Expected – OOCL Volume by OOCL as % of total throughput 1H2017 1H2018 • Throughput from OOCL accounted for about only 2.1% of total subsidiaries • Increasing volume from OOCL is expected 11.00% 6.00% 6.20% 3.60% 3.40% 3.40% 3.20% 1.50% 0.50% 1.30% PCT Noatum Zeebrugge Xiamen Guang
Slide 18: Our Response to Market Challenges
1H2018 Operations Our Response to Review Market Challenges 18
Slide 19: Market Challenges and our Response
Market Challenges and our Response • Limited impact • Products ship through Xiamen and Nansha to US are mainly apparel, Sino-US trade home products and home tension electronic appliances, those are • As a leading port player with an not on US tariff list unique advantage of backing up • Only Xiamen
Slide 20: Case Studies
1H2018 Operations Case Studies Review 20
Slide 21: PCT
PCT ‘000 TEU Throughput Basic information of Piraeus Container Terminal S.A. (“PCT”) 4,000 3,500 100% owned by CSP CAGR 27.2% (FY10-17) 3,000 Coastline 2,487 meters 2,500 Water depth: 14.5-18.5 meters 2,000 1,500 No. of berths in operating 7 1,000 Current handling capacity: 5.5mn TEU 500 Designed ca
Slide 22: Noatum
Noatum • Completed the acquisition of 51% stake in Noatum Basic information of NPH Group in Oct 2017 51% owned by CSP (Valencia) 39.78% owned by CSP (Bilbao) • Throughput of Noatum was on the rise after the Coastline 2,310 meters (Valencia) acquisition 1,508 meters (Bilbao) Water depth: 16 meters (V
Slide 23: Xiamen Oceangate
Xiamen Oceangate ‘000 TEU Throughput 1,600 Basic information of Xiamen Oceangate 1,400 70% owned by CSP CAGR 40.8% (FY12-17) 1,200 Coastline: 1,508 meters 1,000 Water depth: 16 meters 800 No. of berths in operating 4 600 Current handling capacity: 1.2mn TEU 400 Designed capacity 1.2mn TEU 200 0 FY12
Slide 24: Invest for Sustainable Growth
1H2018 Invest for Operations Review Sustainable Growth 24
Slide 25: Where we are
Where we are FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 • First full year of operation Fast expansion and stages of investments as a pure port operator • Entered into investment • M&A Completed A global terminal network with STAGES OF stages, increased • strategic investments in the port authority co
Slide 26: Invest for Sustainable Growth
Invest for Sustainable Growth Total CAPEX Spent in 1H2018: US131.3mn Total CAPEX planned for 2H2018: US$619.6 million Others 1.0% Others 0.5% Investment in PSA 15.3% M&A (China) + port authority investment 22.3% M&A (overseas) 0.9% PP&E 84.2% PP&E 75.8% • We remain prudent in deploying financial res
Slide 27: FY2018 Guidance
1H2018 Operations FY2018 ReviewGuidance 27
Slide 28: 2018 Full-year Guidance
2018 Full-year Guidance Continue to Only limited strengthen synergy exposure to with Ocean US trades Alliance and parent company • Low teens growth in throughput for FY2018 Contributions from newly acquired • Sustainable growth in 1H2018 projects 2H2018 47% of revenue in RMB and 53% in Euro Continue
Slide 29: Disclaimer
Disclaimer This presentation contains certain forward-looking statements with respect to the financial condition, results of operations and business of COSCO SHIPPING Ports Limited (“COSCO SHIPPING Ports”) and certain plans and prospects of the management of COSCO SHIPPING Ports. Such forward-lookin
Slide 30: Thank You
1H2018 Operations Thank You Review https://ports.coscoshipping.com 30