Chinasoft International Ltd. · HKEX:354
Chinasoft International — Q2 2013 Earnings Presentation
38 slides from Chinasoft International's earnings presentation, 2013
Slide 1: ChinaSoft International Investor Presentation Second Quarter 2013
ChinaSoft International (0354.HK) Investor Presentation Second Quarter 2013
Slide 2: Disclaimer
Disclaimer These presentations and/or other documents have been written and presented by Chinasoft International Limited (“ChinaSoft International” or “the Company”). The information presented or contained in these materials is subject to change without notice and its accuracy is not guaranteed.
Slide 3: Background Info
Background Info 1 Background Info 2 Deep domain expertise in China’s most attractive verticals Comprehensive end-to-end service offerings with superior 3 consulting and solution capabilities Serving blue-chip clients with strong China presence and global delivery 4 capabilities 5 Strategic Partnersh
Slide 4: Snapshot of ChinaSoft International
Snapshot of ChinaSoft International Headcount 18946 Service Professional Services (48.4%) 14496 Offering Outsourcing Services (47.9%) 10940 (% of service revenue1) Training (3.7%) 7759 4816 4363 2382 477 1055 238 Government & Manufacturing (24.2%) 2003 2004 2005 2006 2007 2008 2009 2010 2011
Slide 5: Business Distribution
Business Distribution Service Revenue by Industry Verticals Service Revenue by Service Type ESG: Others Training 4.5% Gov't & 3.7% MFG 24.2% OSG: Telecom IT 28.6% Outsourcing PSG: Services IT 47.9% Consulting & Solutions 48.4% BFSI 17.3% Hi-Tech Charging mode: Charging mode: 16.0% Public time and ma
Slide 6: Business Development History
Business Development History Leading China based IT Services platform 2012 2010 that serves the world with deep domain expertise Headcount: 18,946 New Industries: and end-to-end service offerings Headcount: 10,940 New Industries: Energy, Insurance Telecommunications New Offering: New Off
Slide 7: Leading IT Services Company in Fast-Growing Chinese Market
Leading IT Services Company in Fast- Growing Chinese Market China Domestic Software Industry Market① Leadership in China IT Services (RMB bn) Ranked Top 2 by IDC in IT Outsourcing for Americas and Europe in 2007-2011 Ranked Top 3 by IDC in Consulting & Solutions for Government industry vertical
Slide 8: Deep Domain Expertise
Deep Domain Expertise 1 Background Info 2 Deep domain expertise in China’s most attractive verticals Comprehensive end-to-end service offerings with superior 3 consulting and solution capabilities Serving blue-chip clients with strong China presence and global delivery 4 capabilities 5 Strategic Par
Slide 9: Deep Domain Expertise in China's Most Attractive Verticals
Deep Domain Expertise in China’s Most Attractive Verticals Auditing & Supervision Food and Drug Management Online Application and Management Approval Meteorology and Scourge Warning Government Social Security and Welfare Office Automation Management Executive Permission Management CR
Slide 10: Case Study: Government – The Nationwide Auditing Program
Case Study: Government – The Nationwide Auditing Program Our Position The only Strategic Partner Total solution provider Core application developer 11 Years of relationship Achievements National Auditing Office Implementation of national audit office Central Government 18 Special Offices s
Slide 11: Case Study: Manufacturing – Nationwide Tobacco Program
Case Study: Manufacturing – Nationwide Tobacco Program Our Position Only Strategic Partner 9 Years of relationship Achievements Business & Decision System, Management Execution System, Logistics Execution System, Warehouse Management System, ERP, RFID, etc Nationwide service network: 31 capi
Slide 12: Case Study: Banking & Insurance – China UnionPay
Case Study: Banking & Insurance– China UnionPay Our Position Only domestic provider for the switching system Total system integrator, and core application software developer 9 Years of relationship Achievements Top5 International Card Organizations 90 Nations and Areas Implementation of Chin
Slide 13: Case Study: Telecom – China Mobile
Case Study: Telecom – China Mobile Our Position Strategic partner at North Base for Mobile Payment and at South Base for Mobile Internet such as Wireless City Strategic partner with Beijing Branch and Shanghai Branch Achievements Multiple cooperation areas with China Mobile Joint mobile IT Ser
Slide 14: Proprietary Advantage: ResourceOne middleware platform
Proprietary Advantage：ResourceOne ® middleware platform Product Positioning Ability Middleware platform based on SOA and components to support Integration : construct integrate skeleton, provide the ability rapid application development, application integration and of function management, integr
Slide 15: Comprehensive End-to-End Service Offerings
Comprehensive End-to-End Service Offerings 1 Background Info 2 Deep domain expertise in China’s most attractive verticals Comprehensive end-to-end service offerings with superior 3 consulting and solution capabilities Serving blue-chip clients with strong China presence and global delivery 4 capabil
Slide 16: Moving Up the Value Chain
Moving Up the Value Chain Strengthening core competitiveness Moving up the value chain Enhancing profitability ESG Intelligence focused Emerging (Analytics, BI) Services Group 智慧型服务 PSG Experience focused Professional Service Group 经验型服务 Efficiency focused OSG 效率型服务 Outsourcing Service Group 16
Slide 17: Comprehensive End-to-End Service Offerings
Comprehensive End-to-End Service Offerings Strategy and Business Consulting IT Consulting Information Technology Consulting PSG Vertical Application Software and Solution Services • Government & Manufactory Solution Consulting & Solutions • Financial & Banking Solution IT Solutions • Telecom D
Slide 18: Our Customers
Our Customers … 1 Background Info 2 Deep domain expertise in China’s most attractive verticals Comprehensive end-to-end service offerings with superior 3 consulting and solution capabilities Serving blue-chip clients with strong China presence and global 4 delivery capabilities 5 Strategic Partnersh
Slide 19: Customers Analysis
Customers Analysis Top Customers Concentration Customer Analysis Top 10 Clients % • For the 2012, the service revenue from the top 5 customers accounted for 38.5% of the Group’s total service 77.0% revenue, remained the same level as 2011’s 38.4%. 65.0% • For the 2012, the service revenue from 58.0%
Slide 20: Blue-Chip Clients
Blue-Chip Clients 100% covering China Top 100 Cigarette Brands “Gold Audit” 2 of the top 3 China “Gold Quality” 20 Ministries of China Automobile Companies Government 4 of the top 5 China “Gold Insurance” 6 of 12 “Gold Projects” Machinery Manufacturers “Gold Agriculture” 5 of the top 10 China “Gold
Slide 21: Global Delivery Capabilities
Global Delivery Capabilities Supporting global customers with abundant HR platform (city and headcount1) 25 Sales and Delivery Centers Beijing–4,427 Worldwide Shanghai–2,595 London–10 Shenzhen–2,379 Xi’an–2,007 Nanjing–1,958 Dalian–1,076 Guangzhou–722 Serving over 100 Chengdu–6
Slide 22: Strategic Partnerships and Growth Strategies
Strategic Partnerships and Growth Strategies 1 Background Info 2 Deep domain expertise in China’s most attractive verticals Comprehensive end-to-end service offerings with superior 3 consulting and solution capabilities Serving blue-chip clients with strong China presence and global delivery 4 capab
Slide 23: Strategic Partnership with Huawei
Huawei Strategic Partnership with Huawei Our 60%-40% JV with Huawei will support strong growth in OSG business Service Revenue from Huawei ITO Chinasoft will be Huawei‘s top supplier in IT outsourcing (InRMBmm) Offering services to product lines in ten R&D bases of Huawei 573 Beyond Huawei –
Slide 24: Strategic Partnership with Microsoft
Microsoft Strategic Partnership with Microsoft GoBig opportunity to Expand Current MS Business 360⁰ Relationship Develop cloud technology with Azure Develop relationship with major MS Seattle London clients in China and abroad Delivery Delivery China 1st Chinese company as Top 10 MSIT Cent
Slide 25: Strategic Partnership with Hony Capital
Hony Capital Strategic Partnership with Hony Capital Hony Capital will strongly support our PSG business development Hony Capital is our largest substantial shareholder Chinasoft has become the integration platform for Hony Capital’s future investments in the IT Similar domain Culture Hony C
Slide 26: New Focus and Growth in New Decade
New Focus and Growth in New Decade FOCUS in the NEXT decade Last Decade Cloud Enabling to Next Decade Cloud Based Services Platform Centric Operations FOCUS in the LAST decade 450 million USD Service Capabilities 2012 2015 2020 Verticals Region Coverage (In RMB mm) 2,768 2,244 1,601 1,10
Slide 27: Growth Strategies
Growth Strategies • Identify industry sectors with native and dominating customer (大型甲方),e.g. tobacco, electricity; Strategic • Forge strong strategic relationships with this customer, first through projects, Relationships then programs and finally partnership (3P); goal: become the de-facto IT serv
Slide 28: Growth via Acquisition
Growth via Acquisition Growth by acquisition has been, and will continue to be, a significant part of ChinaSoft International’s growth strategy. (Please see a list of companies at the end of this presentation that CIS acquired in the past.) We typically acquire to 1) expand presence in a specific in
Slide 29: Financials
Financials 1 Background Info 2 Deep domain expertise in China’s most attractive verticals Comprehensive end-to-end service offerings with superior 3 consulting and solution capabilities Serving blue-chip clients with strong China presence and global delivery 4 capabilities 5 Strategic Partnerships a
Slide 30: Key Financial and Operating Data
Key Financial and Operating Data RMB’000 2012 2011 Growth% Revenue 2,768,171 2,243,754 23.4% Service Revenue 2,551,395 1,959,885 30.2% Gross Profit 915,341 729,491 25.5% EBITDA* 328,838 293,184 12.2% Non-GAAP Operating Profit** 293,805 278,998 5.3% Net Profit attributable to Equity Shareholders 133,
Slide 31: Financial and Operating Ratio Analysis
Financial and Operating Ratio Analysis Per Per Service Per Per Service RMB’000 2012 2011 Growth% Revenue% revenue% Revenue% revenue% Revenue 2,768,171 2,243,754 23.4% Service Revenue 2,551,395 92.2% 1,959,885 87.3% 30.2% Cost of sales (1,852,830) -66.9% -72.6% (1,514,263) -67.5% -77.3% 22.4% ——Salar
Slide 32: Non-GAAP and GAAP Reconciliations
Non-GAAP and GAAP Reconciliations Per Per Per Per Service Service RMB’000 2012 Revenue 2011 Revenue Growth% revenue revenue % % % % GAAP Net Profit 133,189 4.8% 5.2% 110,594 4.9% 5.6% 20.4% Adjustments: +Loss in FV changes of p shares 0 0.0% 0.0% 37,287 1.7% 1.9% -100.0% +Impairment loss 28,054 1.0%
Slide 33: Balance Sheet
Balance Sheet (Audited) (Audited) (Audited) (Audited) RMB’000 RMB’000 31 Dec, 2012 31 Dec, 2011 31 Dec, 2012 31 Dec, 2011 Current liabilities Current assets Trade and other payables 668,918 613,149 Inventories 23,989 24,405 Bills payable 7,071 21,525 Amounts due to customers for Trade and other rece
Slide 34: Operating Cash flow
Operating Cash flow Net Cash flow from Operating Activities (In RMBmm) 123 121 92 86 44 38 12 -78 2005 2006 2007 2008 2009 2010 2011 2012 34
Slide 35: Days Receivable Comparison with Peers
Days Receivable Comparison with Peers 185 119 156 151 142 137 134 126 157 206 156 2006 2007 2008 2009 2010 2011 2012 35
Slide 36: Aging Analysis of Accounts Receivables
Aging Analysis of Accounts Receivables (Audited) (Audited) RMB’000 % % 2012 versus 2011 31 Dec,2012 31 Dec,2011 Within 90 days 601,133 43% 483,793 48% 117,340 24% Between 91-180 days 116,221 8% 80,316 8% 35,905 45% Between 181-365 days 54,822 4% 39,804 4% 15,018 38% Between 1-2 years 56,828 4% 30,29
Slide 37: Thank You
THANK YOU IR Contacts Janet Lai Tel +852 2915-2830 Email ir@chinasofti.com
Slide 38: Shareholdings Structure
Shareholdings Structure Shareholdings Structure % of As of 2013 May 31 No. of Shares Ordinary Shares Hony Capital 19.4% Hony Capital 335,076,453 19.4% Dr. Chen Yuhong 171,579,039 9.9% Others Dr. Chen Greater Pacific Capital 119,268,639 6.9% 46.5% Yuhong 9.9% Far East Holdings 113,399,822 6.6% Intern
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