Keppel Ltd. · SGX:BN4

Keppel — Q2 2015 Earnings Presentation

64 slides from Keppel's earnings presentation, Jul 23, 2015

  1. Slide 1: Second Quarter and First Half 2015 Financial Results

    Second Quarter and First Half 2015 Financial Results 23 July 2015 1

  2. Slide 2: Scope of Briefing

    Scope of Briefing  Address by CEO  Group Financial Highlights by CFO 2

  3. Slide 3: Address by CEO

    Address by CEO 3 (CS) Corporation

  4. Slide 4: Global Economy: Slower Growth & Volatility

    Global Economy: Slower Growth & Volatility  US on track for moderate expansion  EU weathering Greek debt crisis  Slower, sustainable growth in China 4

  5. Slide 5: Performance Highlights

    Performance Highlights  2Q 2015 net profit was S$397m  1H 2015 net profit was S$757m  1H 2015 EVA was S$225m  Annualised ROE was 13.1%  Interim dividend of 12.0 cts per share 5

  6. Slide 6: Consistent Contributions from RIDs

    Consistent Contributions from RIDs S$m 2,500 2,237 2,000 1,946 1,885 1,846 1,511 1,500 1,000 757 455 434 470 500 284 323 272 0 2010 2011 2012 2013 2014 1H2015 Net Profit Revaluations, Major Impairments & Divestments (RIDs) 6

  7. Slide 7: Recycling Capital, Creating Value

    Recycling Capital, Creating Value Property  One of the largest Pan-Asian commercial  Manager of five private equity funds. REITs listed on SGX.  AUM* of approx. S$10.5b.  AUM of approx. S$8.2b. Combined AUM of S$23.7b Infrastructure  Largest Singapore infrastructure trust  Asia’s first data ce

  8. Slide 8: Business Updates

    BUSINESS UPDATES 8 (-1] Corporation

  9. Slide 9: Offshore & Marine

    Offshore & Marine Net orderbook YTD Newbuild jackups 23% Newbuild Others semis 4% S$11.0b 42% Specialised vessels 4% FPSOs/FLNGs 27% Non-drilling solutions underpinned year-to-date new order wins.  Year-to-date order wins: about S$1.5b including an FLNG conversion, an ice-class multi-purpose vessel

  10. Slide 10: Offshore & Marine

    Offshore & Marine 12 major completions in 1H15:  5 Jackups  1 Accommodation Semi  1 Depletion Compression Platform  1 Floating Crane  1 FPSO modules integration  3 Turret fabrications Deliveries in 2H15:  10 Jackups  1 FPSO conversion CANTARELL I, II and III for Grupo R Keppel O&M is focused

  11. Slide 11: Exploration & Production Market

    Exploration & Production Market  94 jackups and 27 floaters >30 years old are uncontracted and due for class renewal surveys in 2015-16.  238 projects worldwide potentially require a floating production or storage system. 3rd FLNG conversion for Golar has been sealed.  Vessel conversion offers qu

  12. Slide 12: Non-Drilling Market

    Non-Drilling Market Keppel O&M’s order-win growth Agility in suite of solutions 64% 11.2 18% 6.8 SMART Semi Ice-Class Multi- Plug & Abandonment Purpose Vessel Jackup S$b 25.9 22.0 Subsea Construction Vessel Liftboat FLNG 2005-09 2010-YTD2015 Drilling solutions/services Non-drilling solutions/service

  13. Slide 13: Property - Residential

    Property - Residential  Over 1,800 homes sold in 1H15, higher than 1,300 homes in 1H14: more than half in China.  Reinvesting S$430m in new projects in Chengdu and West Jakarta. Pipeline of residential launches (2H15-2017) Others 5% Singapore 5% Vietnam 14% 18,775 launch-ready Indonesia units Chin

  14. Slide 14: Property - Commercial

    Property - Commercial  Saigon Centre Phase 2 retail podium is 67% pre-committed.  Reinvested S$186m in an office building in London. Overseas commercial portfolio under development Myanmar 6% Vietnam 13% GFA of China 45% 840,000 sm Indonesia 17% Philippines 19% Saigon Centre, Vietnam * As at end-J

  15. Slide 15: Infrastructure: EPC projects

    Infrastructure EPC projects  Handed over both phases of the Greater Manchester EfW Plant.  Doha North Sewage Treatment Works Plant to be substantially completed in 2015. Greater Manchester Energy-from-Waste Plant, the UK 15

  16. Slide 16: Infrastructure: Infrastructure Business Trust

    Infrastructure Infrastructure Business Trust  Keppel Infrastructure Trust raised S$525m in Singapore’s largest equity deal year-to-date.  Keppel Infrastructure divested 51% of Keppel Merlimau Cogen plant to the enlarged Keppel Infrastructure Trust. Keppel Merlimau Cogen plant 16

  17. Slide 17: Infrastructure: Data centres and Logistics

    Infrastructure Data centres  Keppel T&T embarked on 4th Singapore data centre, and will soon begin operations of Almere Data Centre 2 in the Netherlands.  Keppel DC REIT acquired Intellicentre 2 in Sydney. Intellicentre 2, Sydney Logistics  Opened new distribution centre in Vietnam Singapore Indu

  18. Slide 18: Investments

    Investments  Keppel will subscribe for 31.3% of KrisEnergy’s S$169.5m rights issue, and sub-underwrite it.  Ocean Mineral Singapore was awarded 15-year seabed exploration contract by International Seabed Authority. KrisEnergy finds oil at Rayrai-1 exploration well, Gulf of Thailand. 18

  19. Slide 19: Recurring Income

    Recurring Income Net profit by segment (S$m) 757 Project-based* 745 Recurring 170 189 (22%) (25%) 501 27 376 21 587 556 (78%) (75%) 474 189 355 129 82 126 67 66 58 53 48 14 14 107 90 71 73 52 34 (23) 1H14 1H15 1H14 1H15 1H14 1H15 1H14 1H15 1H14 1H15 Offshore & Marine Property Infrastructure Investme

  20. Slide 20: Configured to Grow

    Configured to Grow Keppel’s corporate milestones (1999-2015) 2015  Privatised Keppel Land  Merged KIT with Net Profit CitySpring, and injected KMC into the enlarged S$m Trust  Consolidated shipyards to form  Restructured Keppel  Acquired stake in Keppel O&M Energy and Keppel Singapore 2500 Inte

  21. Slide 21: Group Financial Highlights by CFO

    Group Financial Highlights by CFO 21

  22. Slide 22: 2Q 2015 Financial Performance

    2Q 2015 Financial Performance Net Profit 2% to S$397m EPS 2% to 21.9cts EVA from S$226m to S$122m Cash Outflow from S$390m to S$542m 22

  23. Slide 23: 2Q 2015 Financial Highlights

    2Q 2015 Financial Highlights S$m 2Q 2015 2Q 2014 % Change Revenue 2,563 3,177 (19) EBITDA 479 533 (10) Operating Profit 414 467 (11) Profit Before Tax 498 593 (16) Net Profit 397 406 (2) EPS (cents) 21.9 22.3 (2) 23

  24. Slide 24: 2Q 2015 Revenue by Segments

    2Q 2015 Revenue by Segments S$m 2Q 2015 % 2Q 2014 % % Change Offshore & Marine 1,580 62 2,062 65 (23) Property 431 17 348 11 24 Infrastructure 549 21 761 24 (28) Investments 3 - 6 - (50) Total 2,563 100 3,177 100 (19) 24

  25. Slide 25: 2Q 2015 Pre-tax Profit by Segments

    2Q 2015 Pre-tax Profit by Segments S$m 2Q 2015 % 2Q 2014 % % Change Offshore & Marine 221 44 345 58 (36) Property 152 31 160 27 (5) Infrastructure 116 23 49 8 137 Investments 9 2 39 7 (77) Total 498 100 593 100 (16) 25

  26. Slide 26: 2Q 2015 Net Profit by Segments

    2Q 2015 Net Profit by Segments S$m 2Q 2015 % 2Q 2014 % % Change Offshore & Marine 173 44 270 67 (36) Property 117 29 67 16 75 Infrastructure 103 26 35 9 194 Investments 4 1 34 8 (88) Total 397 100 406 100 (2) 26

  27. Slide 27: 1H 2015 Financial Performance

    1H 2015 Financial Performance Net Profit 2% to S$757m EPS 2% to 41.7cts Annualised ROE from 14.3% to 13.1% EVA from S$412m to S$225m Cash Outflow from S$781m to S$316m Net Gearing from 0.11x to 0.42x Interim Cash Dividend maintained at 12.0 cts per share 27

  28. Slide 28: 1H 2015 Financial Highlights

    1H 2015 Financial Highlights S$m 1H 2015 1H 2014 % Change Revenue 5,377 6,173 (13) EBITDA 943 1,011 (7) Operating Profit 812 882 (8) Profit Before Tax 953 1,085 (12) Net Profit 757 745 2 EPS (cents) 41.7 41.0 2 28

  29. Slide 29: 1H 2015 Revenue by Segments

    1H 2015 Revenue by Segments S$m 1H 2015 % 1H 2014 % % Change Offshore & Marine 3,507 65 3,981 65 (12) Property 758 14 677 11 12 Infrastructure 1,058 20 1,497 24 (29) Investments 54 1 18 - 200 Total 5,377 100 6,173 100 (13) 29

  30. Slide 30: 1H 2015 Pre-tax Profit by Segments

    1H 2015 Pre-tax Profit by Segments S$m 1H 2015 % 1H 2014 % % Change Offshore & Marine 472 50 649 60 (27) Property 254 27 291 27 (13) Infrastructure 150 16 95 9 58 Investments 77 7 50 4 54 Total 953 100 1,085 100 (12) 30

  31. Slide 31: 1H 2015 Net Profit by Segments

    1H 2015 Net Profit by Segments S$m 1H 2015 % 1H 2014 % % Change Offshore & Marine 376 50 501 67 (25) Property 189 25 129 17 47 Infrastructure 126 17 67 9 88 Investments 66 8 48 7 38 Total 757 100 745 100 2 31

  32. Slide 32: Net Profit & EPS

    Net Profit & EPS Net profit (S$m) EPS (Cents) 2,237 124.8 1,946 619 1,846 1,885 109.4 34.5 102.3 103.8 1,540 1,591 4Q: 87.9 90.4 844 4Q: 4Q: 4Q: 346 726 47.4 246 685 14.0 19.3 38.0 39.9 636 36.1 296 16.9 521 3Q: 3Q: 29.1 3Q: 3Q: 406 457 414 22.8 305 757 17.3 25.3 22.9 41.7 726 2Q: 2Q: 2Q: 41.5 2Q: 2

  33. Slide 33: ROE & Dividend

    ROE & Dividend Dividend in specie Dividend in specie Dividend in specie ~20.9cts/share ~28.6cts/share ~9.5cts/share Plus Plus Plus 29.1% 27.2% 26.4% 25.3% 19.5% 18.8% 43.0 45.0 40.0 38.2 13.1% 34.6 48.0 17.0 18.0 13.6 14.5 12.0 12.0 10.0 2009 2010 2011 2012 2013 2014 1H 2015 ROE Interim Dividend Ful

  34. Slide 34: Free Cash Flow

    Free Cash Flow 1H 2015 1H 2014 S$m S$m Operating profit 812 882 Depreciation & other non-cash items (175) 119 637 1,001 Working capital changes (695) (1,440) Interest & tax paid (214) (203) Net cash used in operating activities (272) (642) Investments & capex (208) (316) Divestments & dividend incom

  35. Slide 35: Configured for growth and value creation

    Configured for growth and value creation through innovation, discipline and agility. 35

  36. Slide 36: 2Q & 1H 2015 Results Q&A

    2Q & 1H 2015 Results Q&A 36 Gye) | Corporation

  37. Slide 37: Additional Information

    Additional Information a CCS Corporation

  38. Slide 38: Revenue by Geography

    Revenue by Geography 1H 2015 Total Overseas Singapore S$m Customers Customers % % Offshore & Marine 3,507 95 5 Property 758 57 43 Infrastructure 1,058 11 89 Investments 54 2 98 Total 5,377 72 28 72% of total revenue came from overseas customers 38

  39. Slide 39: EBITDA by Segments

    EBITDA by Segments S$m 1H 2015 % 1H 2014 % % Change Offshore & Marine 497 53 651 64 (24) Property 219 23 177 18 24 Infrastructure 189 20 155 15 22 Investments 38 4 28 3 36 Total 943 100 1,011 100 (7) 39

  40. Slide 40: Capital/Gearing/ROE

    Capital/Gearing/ROE S$m 30 Jun 2015 31 Dec 2014 Shareholders’ Funds 10,825 10,381 Capital Employed 11,893 14,728 Net Debt 5,049 1,647 Net Gearing Ratio 0.42x 0.11x ROE 13.1% 18.8% 40

  41. Slide 41: Offshore & Marine

    OFFSHORE & MARINE “ Cry] Corporation

  42. Slide 42: Financial Highlights – Offshore & Marine

    Financial Highlights – Offshore & Marine S$m 2Q 2015 2Q 2014 % Change Revenue 1,580 2,062 (23) EBITDA 228 337 (32) Operating Profit 194 302 (36) Profit Before Tax 221 345 (36) Net Profit 173 270 (36) 42

  43. Slide 43: Financial Highlights – Offshore & Marine

    Financial Highlights – Offshore & Marine S$m 1H 2015 1H 2014 % Change Revenue 3,507 3,981 (12) EBITDA 497 651 (24) Operating Profit 426 582 (27) Profit Before Tax 472 649 (27) Net Profit 376 501 (25) 43 43

  44. Slide 44: Offshore & Marine Review

    Offshore & Marine Review  About S$1.5b contracts secured in YTD 2015: An FLNG conversion, an ice-class multi-purpose vessel, 2 liftboats, an AHT, a semi upgrade, a semi repair, a topside fabrication, a turret fabrication, a drillship upgrade and an LNG vessel upgrade.  Contract completions in 1H 2

  45. Slide 45: Offshore & Marine Orderbook

    Offshore & Marine Orderbook Contract Value Gross Net Client S$m. S$m. For delivery in 2015 10 JUs/1 JU Repair/Semi Repair/1 Drillship Repair/1 FPSO Grupo R/Parden/Falcon Energy/ Conversion/1 Transformer Platform/2 Ice Class Supply Vessels/ UMW/Arabian Drilling Co./ 1 Liftboat/1 Ice Class Multi-Purpo

  46. Slide 46: Property

    PROPERTY 46 VET] Corporation

  47. Slide 47: Financial Highlights - Property

    Financial Highlights - Property S$m 2Q 2015 2Q 2014 % Change Revenue 431 348 24 EBITDA 129 85 52 Operating Profit 122 81 51 Profit Before Tax 152 160 (5) Net Profit 117 67 75 47

  48. Slide 48: Financial Highlights - Property

    Financial Highlights - Property S$m 1H 2015 1H 2014 % Change Revenue 758 677 12 EBITDA 219 177 24 Operating Profit 206 169 22 Profit Before Tax 254 291 (13) Net Profit 189 129 47 48

  49. Slide 49: Residential Landbank - Singapore

    Residential Landbank - Singapore Attributable Total Units Remaining Singapore Stake Tenure Units Sold GFA (sf) Units Launched Units# Launched Projects The Glades 70% 99-yr 384,357 726 350 320 406 Corals at Keppel Bay 100% 99-yr 152,999 366 200 194 172 Reflections at Keppel Bay 100% 99-yr 624,527 1,1

  50. Slide 50: Residential Landbank - China

    Residential Landbank - China Remaining Total GFA Total Units Units Remaining Area Units China Location Stake (sm) Units Launched Sold For Sale (sm) For Sale# 8 Park Avenue Shanghai 99% 133,393 918 918 808 23,497 110 The Springdale Shanghai 99.40% 328,792 2,596 2,531 2,502 39,253^ 94 Seasons Residenc

  51. Slide 51: Residential Landbank - Other Overseas

    Residential Landbank - Other Overseas Remaining Total GFA Units Units Remaining Area Projects Stake Total Units Units For (sm) Launched Sold for Sale (sm) Sale# Vietnam Saigon Sports City, HCMC 90% 688,180 2,622 - - 289,850^ 2,622 Estella Heights, HCMC 98% 160,980 872 472 344 63,568^ 528 Riviera Poi

  52. Slide 52: Residential Launch Readiness – China

    Residential Launch Readiness – China Units Ready to Launch Project Location 2H2015 2016 2017 8 Park Avenue* Shanghai 60 66 - The Springdale* Shanghai 107 - - Seasons Residence* Shanghai 143 350 246 Hill Crest Villa^ Shanghai 20 47 47 Waterfront Residence* Nantong 17 18 21 Central Park City* Wuxi 289

  53. Slide 53: Residential Launch Readiness – Other Overseas

    Residential Launch Readiness – Other Overseas Units Ready to Launch Project Location 2H2015 2016 2017 Indonesia West Vista^ West Jakarta 803 850 850 Vietnam Estella Heights, Dist 2* HCMC 206 258 75 Riviera Point, Dist 7* HCMC 269 200 319 Dong Nai Waterfront City ^ Dong Nai - 220 460 Riviera Cove, Di

  54. Slide 54: Expected Completion for Launched Projects

    Expected Completion for Launched Projects Units Units Units Sold as Expected Total Launched as Remaining Projects/Phases Launched at end-Jun Completion Units at end-Jun as at end- 2015 ^ 2015 Jun 2015 China Central Park City, Wuxi, Plot C2B 256 256 250 6 3Q15 Central Park City, Wuxi, Plot C2C 520 22

  55. Slide 55: Expected Completion for Upcoming Projects

    Expected Completion for Upcoming Projects Projects/Phases to be No. of Units Expected to be Completed^ Location Launched 2H2015 2016 2017 China 8 Park Avenue Shanghai 106 - - The Springdale Shanghai 60 - - Seasons Residence Shanghai - 198 - Hill Crest Villa Shanghai - 45 45 Central Park City Wuxi -

  56. Slide 56: New Commercial Projects Overseas

    New Commercial Projects Overseas Development Commercial Projects under Development GFA (sm) Completion Cost(1) Indonesia IFC Jakarta Tower 1 (100% stake) 86,357 $266.4m 2020 Vietnam Saigon Centre Ph 2, HCMC (45.3% stake) 50,000 (Retail) $228m 2016 (Retail) 40,000 (Office) 2017 (Office) 200 units (Se

  57. Slide 57: Fund Management

    Fund Management  Keppel REIT achieved 99.3% committed occupancy for its portfolio.  Keppel REIT & Alpha’s combined AUM stood at S$18.7b* as at end-Jun 2015. 20 $18.7b $18.7b $17.7b $14.8b $15.3b 15 10.5 10.5 10.5 8.8 S$b 10 8.8 5 7.2 8.2 8.2 6 6.5 0 2011 2012 2013 2014 End-Jun 2015 Keppel REIT Alp

  58. Slide 58: Infrastructure

    INFRASTRUCTURE 58 Gye) | Corporation

  59. Slide 59: Financial Highlights - Infrastructure

    Financial Highlights - Infrastructure S$m 2Q 2015 2Q 2014 % Change Revenue 549 761 (28) EBITDA 135 82 65 Operating Profit 111 56 98 Profit Before Tax 116 49 137 Net Profit 103 35 194 59

  60. Slide 60: Financial Highlights - Infrastructure

    Financial Highlights - Infrastructure S$m 1H 2015 1H 2014 % Change Revenue 1,058 1,497 (29) EBITDA 189 155 22 Operating Profit 142 104 37 Profit Before Tax 150 95 58 Net Profit 126 67 88 60

  61. Slide 61: Investments

    INVESTMENTS 61 iG | Corporation

  62. Slide 62: Financial Highlights - Investments

    Financial Highlights - Investments S$m 2Q 2015 2Q 2014 % Change Revenue 3 6 (50) EBITDA (13) 29 NM Operating Profit (13) 28 NM Profit Before Tax 9 39 (77) Net Profit 4 34 (88) 62

  63. Slide 63: Financial Highlights - Investments

    Financial Highlights - Investments S$m 1H 2015 1H 2014 % Change Revenue 54 18 200 EBITDA 38 28 36 Operating Profit 38 27 41 Profit Before Tax 77 50 54 Net Profit 66 48 38 63

  64. Slide 64: Forward-looking statements notice

    This release may contain forward-looking statements which are subject to risks and uncertainties that could cause actual results to differ materially from such statements. Such risks and uncertainties include industry and economic conditions, competition, and legal, governmental and regulatory chang

Keppel — Q2 2015 Earnings Presentation on 6ix