Hung Hing Printing Group Limited · HKEX:450
Hung Hing Printing — 9M ended Dec 2012 Earnings Presentation
23 slides from Hung Hing Printing's earnings presentation, 2012
Slide 1: Annual Results Presentation
Annual Results Presentation For the nine months ended 31 Dec. 2012 0
Slide 2: Disclaimer
Disclaimer The presentation is prepared by Hung Hing Printing Group Limited (the “Company”) and is solely for the purpose of corporate communication and general reference only. The presentation is not intended as an offer to sell, or to solicit an offer to buy or to form any basis of investment deci
Slide 3: Highlights - 9 Months ending Dec. 2012
Highlights - 9 Months ending Dec. 2012 Group revenue rose by +6 % vs. prior period. Profit before Tax went up by +26 % vs. prior period. Export (Book and Package Printing) revenue rose by 15 %, riding on the accelerated pace of consolidation among export printers in south China. Domestic business wa
Slide 4: Established infrastructure in the PRD region and base in East China
Hung Hing has established infrastructure in the PRD region and an established base in East China Hung Hing–overview of manufacturing facilities Zhongshan Wuxi Printing and manufacturing of folding Printing and manufacturing of folding cartons, cartons, litho lam and corrugated litho lam and corrugat
Slide 5: Hung Hing operates four complementary business segments
Hung Hing operates four complementary business segments Book & package Consumer product Corrugated box Paper trading printing packaging Leader globally Major player in China Major player in South Major player in South Market position China China % 2012 Apr-Dec 58% (HK$1,399mm) 24% (HK$573mm) 9% (HK$
Slide 6: Revenue Is Up By +6%
Revenue Is Up By +6 % 3,000 2,854 2,765 2,398 310 316 2,407 2,500 2,273 264 290 228 343 Paper Trading 245 206 2,000 256 768 214 (HK$ million) 706 573 Corrugated Box 1,500 621 597 Consumer Product 1,000 Packaging 1,452 1,513 1,399 Book and Package 1,178 1,216 Printing 500 0 FY09/10 FY10/11 FY11/12 20
Slide 7: Profit improved in our largest business – Books & Package Printing
Profit improved in our largest business – Books & Package Printing 350 300 237 Paper Trading 250 192 (HK$ million) 45 200 Corrugated Box 34 56 150 39 87 89 83 Consumer Product 46 100 Packaging 9 21 23 22 119 50 91 30 30 16 Book and Package 18 15 42 Printing 14 19 0 -1 FY09/10 FY10/11 FY11/12 2011 4
Slide 8: Segment financials – Books and package printing
Segment financials – Books and package printing Books and package printing Commentary External revenue Revenue rose by +15 % vs. prior period. Segment profit (%) Revenue (HK$mm) 1,600 1,513 12% The falling demand in books together with the 1,448 1,452 10% 1,399 spiral labor costs have accelerated th
Slide 9: Books and package printing – Key cost variables
Books and package printing – Key cost variables USD vs CNY during Jan 2010 – Dec 2012 Payroll costs as a % of revenue 40% 30% 20% 32% 31% 30% 28% 10% 0% FY10/11 FY11/12 2011 4-12 2012 4-12 Minimum wage rate in Shenzhen (in RMB) During the three-year period: 2,000 • RMB has appreciated 8% against USD
Slide 10: Segment financials – Consumer product packaging
Segment financials – Consumer product packaging Consumer product packaging Commentary External revenue Revenue (HK$mm) Segment profit (%) Revenue went down by – 4 % vs. prior period. 1,000 10% 9% 8% Slowing economic growth and new entrants 800 768 752 706 moved-over from the export sector 6% intensi
Slide 11: Segment financials – Corrugated box
Segment financials – Corrugated box Corrugated box Commentary External Intersegment Segment profit (%) Impacted by the slowdown in export Revenue (HK$mm) manufacturing across Pearl River Delta. 600 20% Business development efforts now shifted to 18% domestic market. Overall, external sales 18% decli
Slide 12: Segment financials – Paper trading
Segment financials – Paper trading Paper trading Commentary External Intersegment Segment profit (%) Serves as a centralized paper buyer for the Revenue (HK$mm) Group. 1,000 10% 9% 9% Inventory flexibility to use internally or sell 8% externally provides a natural raw material 800 8% hedge mechanism
Slide 13: Business Unit Analysis
Business Unit Analysis Period Ended Period Ended 31/12/2012 31/12/2011 (HK$ million) Inter- External segment Profit Profit Sales sales Total Contribution Contribution Book & Package Printing 1,399 1 1,400 42 19 Consumer Product Packaging 573 13 586 16 15 Corrugated Box 206 73 279 22 30 Paper Trading
Slide 14: Solid Financial Position
Solid Financial Position (HK$ million) 31/3/2010 31/3/2011 31/3/2012 31/12/2011 31/12/2012 Assets Non-current 1,467 1,569 1,572 1,574 1,520 Current 2,356 2,076 2,214 2,413 2,109 3,823 3,645 3,786 3,987 3,629 Liabilities Non-current 41 57 358 377 276 Current 795 776 624 798 539 836 833 982 1,175 815
Slide 15: Capital Investment – business capability
Capital Investment – business capability 180 Commentary 157 Slowed down CAPEX spending amid 160 the economic uncertainty in our export 141 market and over-capacity in domestic 140 132 packaging industry in China. Rather than expanding capacity, we 120 focused in the upgrading of our (HK$ million ) m
Slide 16: Profit Attributable To Owners of the HHPG & Earnings Per Share
Profit Attributable To Owners of the HHPG & Earnings Per Share Profit Attributable to Owners of HHPG Basic Earnings per share 180 167 20 18.2 156 17.3 160 18 140 16 120 14 (HK$ million) 12 (HK Cents) 100 10 80 8 60 54 6.0 6 37 4.1 40 26 4 2.8 20 2 0 0 FY09/10 FY10/11 FY11/12 2011 4- 2012 4- FY09/10
Slide 17: Proposed Dividends
Proposed Dividends Commentary 35 27 30 23 2012 4-12 Dividends 25 Interim (paid) 3 cents Final (proposed) 2 cents (HK Cents) 20 14 9 17 5 cents 15 10 10 10 5 5 4 5 2 5 2 4 4 3 2 0 FY08/09 FY09/10 FY10/11 FY11/12 2012 4-12 Interim dividend Final dividend Special dividend 16
Slide 18: Business Outlook (short-term)
Business Outlook (short-term) 1. Export Markets With the improving employment and consumer sentiment, we expect growing order intake from the U.S. market. On the other hand, we expect the Euro-zone economy will continue to be fragile. 2. Increasing consolidation among export printers in south China
Slide 19: Business Outlook (medium term)
Business Outlook (medium term) 4. New opportunities in the China domestic market - MNC publishers are moving into China. HH is well positioned to be their printing partner particularly in the Children’s Books segment. - Partnering with Rengo, HH is exporting quality sales display shelves to Japan wi
Slide 20: Green & Quality Product
Green & Quality Product HUNG HING Safe & Agile & ECO Factory Sustainable Raw Material Responsible Management FSC–Forest Stewardship Council , chain of custody to GMI - monitors and measures the performance of packaging BRC – British Retail Consortium - A standard to ensure ensure paper originates fr
Slide 21: BelugaBloo – a new e-publishing service
BelugaBloo – a new e-publishing service 20
Slide 22: Innovate Beyond Printing
Innovate Beyond Printing Gamify Printing Products BelugaBloo Kids Bookstore 21
Slide 23: Thank you Q&A
Thank you Q&A A Leading Printer in Asia With unrivalled market leadership, well-balanced portfolio and sustained growth for over six decades, Hung Hing is in an excellent position to take advantage of growing opportunities as the economic recovery continues to build momentum. 22
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