Hemas Holdings Ltd. · CSELK:HHL.N0000
Hemas — H1 FY2019-20 Earnings Presentation
31 slides from Hemas's earnings presentation, Jan 16, 2020
Slide 1: Investor Presentation Hemas Holdings PLC 1H FY 2019–2020
Investor Presentation Hemas Holdings PLC 1H FY 2019–2020 January 16, 2020
Slide 2: Hemas Holdings PLC: Our portfolio
Hemas Holdings PLC: Our portfolio Home & Personal care SL Pharma Manufacture Home & Personal care International Pharma Distribution School & Office Supplies He Hospitals er a um lth ns Digital Healthcare ca Co ty re Le ili isu ob Hotels re M Logistics Travel Maritime Aviation Copyright © 2019 Hemas
Slide 3: Market leading positions in Consumer and Healthcare
Hemas Holdings PLC: Market leading positions in Consumer and Healthcare Market Leading H&PC Brands Group Revenue by Segment 1H FY 2019-20 Mobility Other Leisure, Travel, Sri Lanka’s Largest & Aviation 4% 2% Pharma Supplier 5% Presence across the Entire Leisure & Travel Value Chain 39% 50% Consumer H
Slide 4: HHL Group Performance: Five year summary
HHL Group Performance: Five year summary Group Revenue and % Growth EBIT and EBIT margin (%) FY 2014 – FY 2019 FY 2014 – FY 2019 6 11.0% 12% 10.4% 10.4% 75 40% 8.8% 10% 8.5% LKR Billions 65 LKR Billions 28.5% 30% 4 8% 55 19.2% 14.3% 6% 45 20% 5.7 16.9% 14.9% 64 4.8 2 4.0 4.2 4% 35 3.4 50 43 10% 25 3
Slide 5: Hemas Holdings PLC: Our Group
Hemas Holdings PLC: Our Group u Market cap: LKR 43.8 billion (US$ 242 million) u Shareholding structure: Esufally family holds 64.3%, 35.7% public holding. u Governance: • HHL is governed by a 11-member board including 5 Independent Directors who are thought leaders in their respective fields of FMC
Slide 6: Hemas Journey: 70 years of serving the nation
Hemas Journey: 70 years of serving the nation Ventured into manufacturing Widened array of Extended into personal care Home & Personal the hospital Sold Power products care (H&PC) brands space Business 1948 1970s 2003 2013 2018 1960s 1980s 2007 2014 Started Extended in to IPO on the Acquired leading
Slide 7: Building strong consumer brands and access to affordable healthcare
We do this by building strong consumer brands and providing access to a wide range of affordable healthcare solutions… Developing a portfolio of Delivering quality medicines and consumer brands that delight therapies to patients who need them • Consolidate market-leading positions • Exceptional supp
Slide 8: Connecting suppliers with customers, travellers and digital wellness
… And connecting suppliers with their customers, travellers with unique experiences and digital-first driven Wellness solutions Serving the region’s logistics and route-to-market needs • Drive superior mobility solutions to serve the region’s logistics needs • Extend into 3PL and last-mile RTM Conne
Slide 9: Industry Focus: Home & Personal Care Sri Lanka
Industry Focus: Home & Personal Care Sri Lanka—driving branded personal care consumption in emerging categories Household Final Consumption in Constant LKR Mn u Sri Lanka’s household consumption grows at 4%, and 2014–2018 personal care (H&PC) categories are highly 8,000 penetrated. CAGR: 3.9% 6,000
Slide 10: School & Office Supplies: Strong outlook as education spending deepens
School & Office Supplies: Strong outlook as education spending deepens in importance to the South Asian householder Monthly Household Education Spend u Education: an investible asset for the Sri Lankan 2010–2016 family: CAGR: 12.5% • 4.5 million school going population, with rapid rise of 2,500 2,06
Slide 11: Consumer Sector Performance: 1H FY 2019–2020
Consumer Sector Performance: 1H FY 2019–2020 No. 1 School & Office Supplies Brand Sector Revenues & EBIT in LKR 1H FY 18 – 1H FY 20 No. 1 Baby Care Brand 15,000Mn 1,485 1,500Mn 12,000Mn 1,200Mn 963 9,000Mn 900Mn No. 2 Oral Care Player 631 6,000Mn 12,167 600Mn 3,000Mn 7,718 11,335 300Mn No. 1 Hair Oi
Slide 12: Home & Personal Care—International: Kumarika to South Asian markets
Home & Personal Care—International: Taking the herbal beauty equity of Kumarika to select South Asian markets u Rapid growth of personal care consumption in FMCG Sales Growth, Bangladesh emerging middle class, adding nearly 30Mn FY 14 – FY 17 15% consumers through 2030. 10% 13.5% u Seeking functiona
Slide 13: H&PC International with our brand Kumarika
H&PC International with our brand Kumarika Sector Highlights International Segment as a % of total H&PC segment u New brand architecture on Kumarika was introduced to the market in 1H FY 18 –1H FY 20 May 2019 100% u Continued focus on expanding into rural markets in Bangladesh 15% 17% 20% u Introduc
Slide 14: Healthcare: Rethinking private healthcare and widening access
Healthcare: Rethinking private healthcare and widening access to medicines, wellness products and healthcare services Growth in Healthcare spending and growth in Healthcare u Healthcare spend driven by growing burden of NCDs. revenue u Middle class consumers seeking convenience: 50% of 2013 – 2017 p
Slide 15: Healthcare Sector Performance: Q2 FY 2019–2020
Healthcare Sector Performance: Q2 FY 2019–2020 Hemas Healthcare Sectors Sector Revenues & EBIT in LKR 1H FY 18 – 1H FY 20 15,000Mn 1,091 1,000 1,200Mn 1 Pharma Manufacturing 963 12,000Mn 900Mn 9,000Mn 13,407 10,529 14,520 600Mn 6,000Mn 2 Pharma Distribution 3,000Mn 300Mn 0Mn 0Mn 1H FY 18 1H FY 19 1H
Slide 16: Mobility: Capitalising on Sri Lanka's geo-strategic location
Mobility: Capitalising on Sri Lanka’s excellent geo-strategic location u Colombo Port throughput grew by 4% for the first Colombo Port’s Throughput (TEU) nine months 2019. 2015 – 2019 u Colombo Port ranked as the fastest growing port 8Mn 7.2 globally by Alphaliner in 1H 18/19 6.0 6.0 6Mn 5.4 5.0 u D
Slide 17: Mobility Sector Performance: Q2 FY 2019–2020
Mobility Sector Performance: Q2 FY 2019–2020 Sector Revenues & EBIT in LKR 1H FY 18 – 1H FY 20 1,500Mn 443 500Mn 420 1,200Mn 400Mn Logistics 900Mn 1,438 1,202 300Mn 1,296 600Mn 200Mn 300Mn 162 100Mn 0Mn 0Mn 1H FY 18 1H FY 19 1H FY 20 Sector Revenue EBIT Business Update u Delays in filling up the war
Slide 18: Leisure: Experiential leisure with an asset-light strategy
Leisure: Focusing on experiential leisure with an asset-light investment strategy u Sri Lanka ranked No.1 travel destination in 2019 by Lonely Tourist Arrivals and Occupancy Planet with tourist arrivals up by 10.7% during the quarter. 2015 – 2018 u Long haul travellers (Europe, Australia) continue t
Slide 19: Leisure, Travel & Aviation Sector Performance: Q2 FY 2019–2020
Leisure, Travel & Aviation Sector Performance: Q2 FY 2019–2020 Sector Revenues & EBIT in LKR 1H FY 18 – 1H FY 20 Hotels 2,000Mn 100Mn 1,500Mn 0Mn 1,838 1,575 -100Mn 1,000Mn 1,438 -200Mn 500Mn -189 -213 -300Mn -370 0Mn -400Mn 1H FY 18 1H FY 19 1H FY 20 Travel Sector Revenue EBIT HEMAS TRAVELS Busines
Slide 20: Overview: 1H FY 2019–2020
Overview: 1H FY 2019–2020 • Strategic Priorities Update • Group Operational Highlights Copyright © 2019 Hemas Holdings PLC | www.hemas.com 20
Slide 21: Group Update: executing on strategic priorities
Group Update: Despite the preliminary setback of FY 20 we have been executing on our Strategic priorities and capacity building investments Hemas sees steady recovery following a challenging first quarter u In the aftermath of the Easter attack Hemas Consumer businesses have been impacted by market
Slide 22: 1H FY 2019–20 Operations Summary
1H FY 2019–20 Operations Summary u Group witnessed a recovery in Q2 with revenues up by 19.2% over Q1 FY20 Sector Revenue & EBIT Margin (%) and operating profit and earnings growing by Rs.662.7Mn and Rs.633.1Mn. 1H FY 18 – 1H FY 20 u Growth was driven by an improvement in our Consumer and Healthcare
Slide 23: 1H FY 2019–20 Sector Highlights
1H FY 2019–20 Sector Highlights Consumer Rev % EBIT % u Steady recovery with a Q-o-Q revenue and profitability growth u Disruption to the sales and distribution due to negative sentiments created post ethnic (LKR Mn) Growth (LKR Mn) Growth backlashes continue to impact H&PC SL and Atlas in achieving
Slide 24: Most Recent Quarter Performance: Q2, FY 2019–2020
Most Recent Quarter Performance: Q2, FY 2019–2020 • Group Operational Highlights • Quarterly Sector Update — Consumer – Domestic — Consumer – International — Healthcare — Mobility — Leisure, Travel and Aviation Copyright © 2019 Hemas Holdings PLC | www.hemas.com 24
Slide 25: Q2 (3 months) FY 2019–20: Group Operational Highlights
Q2 (3 months) FY 2019–20: Group Operational Highlights Revenue EBIT Earnings 1,600Mn 37.5% 1,000Mn 27.6% 44.3% -4.7% 16,000Mn 1,200Mn 750Mn 12,000Mn 927 800Mn -54.9% 500Mn 8,000Mn 16,514 15,738 1,511 -77.6% 4,000Mn 400Mn 682 250Mn 207 0Mn 0Mn 0Mn FY 19 - Q2 FY 20 - Q2 FY 19 - Q2 FY 20 - Q2 FY 19 - Q
Slide 26: Investment Highlights
Investment Highlights Digital & Innovation People & Talent Sustainability & Wellness Copyright © 2019 Hemas Holdings PLC | www.hemas.com 26
Slide 27: Investment Highlights
Investment Highlights Total Shareholder Return (%) Return on Equity (%) Return on Capital Employed 50% 39.0% 20% 20% 25% 11.2% 11.2% 13.9% 15.5% 13.2% 10% 0% 10% 0% 4.2% -25% -1.6% -50% -39.1% -10% 0% FY 17 FY 18 FY 19 1H FY 18 1H FY 19 1H FY 20* 1H FY 18 1H FY 19 1H FY 20* Note: Annualised FY 20 EP
Slide 28: Driving digital and innovation
Driving digital and innovation u Being driven by Innovation is a core value of Hemas Group, and our digital strategy is at the forefront of our drive towards reinvention in preparation for the business world of tomorrow. Ayubo.life Focusing on making Health and wellness more accessible digitally, co
Slide 29: We continue to invest in people
We continue to invest in people Future Leaders’ Be your best self Programme • “360 You”, the Hemas Employee Value • Successful completion of a third year Proposition was launched in October 2017 and is development program in partnership with Indian an expression of how Hemas commits to enrich Instit
Slide 30: Sustainability & Wellness
Sustainability & Wellness Group Environmental Goals by 2025 Engaging with Our Community Reduction of consumption of water by 50% 50% of reduction of energy • Scholarship programme in • 56 Pre schools partnership with ministry consumption by 2022 and by 2025 of child affairs • 3500+ children impacted
Slide 31: Disclaimer
Disclaimer The material in this presentation has been prepared by Hemas Holdings PLC (“Hemas”) and is general background information about Hemas’ activities current as at the date of this presentation. This information is given in summary form and does not purport to be complete. Information in this