Oriental Weavers Carpet · EGX:ORWE
Oriental Weavers Carpet — Oriental Weavers — Q4 2019 Earnings Presentation
24 slides from Oriental Weavers Carpet's earnings presentation, 2020
Slide 1: Earnings Presentation 4Q2019
Earnings Presentation 4Q2019
Slide 2: Oriental Weavers in Numbers
Oriental Weavers in Numbers No. 1 EGP 10.1 bn 64% World Largest Record Turnover in Export contribution producer by volumes 2019 in 2019 80-85% c. 80% EGP 579 mn Market share in Backlog of export Utilization rate incentives (as of 31st Egypt Jan 2020) Slide 2
Slide 3: Main segments of OW
Main segments of OW Woven Tufted Non-woven Description Surface yarn is woven simultaneously The surface yarn is Fibers bonded with the backing. Then a latex inserted into a together using compound is added. polypropylene sheet chemicals and heat. Subsidiaries OWC OWI & OWUSA OW MAC New MAC EFCO OWT
Slide 4: A Vertically Integrated Business Model
A Vertically Integrated Business Model Oriental Weavers has complete control over the manufacturing process. Raw material procurement: The wool is sourced from suppliers in Egypt, New Zealand and the UK; Polypropylene granules are sourced from local and regional suppliers. Fiber extrusion: Raw w
Slide 5: Demand Drivers in Egypt
Demand Drivers in Egypt Growing economy GDP is expected to grow by 5.9% annually up to 2024 as Sizeable youth bracket per the IMF. Sizeable youth 50% of the Egyptian population are near the marriage with population around one million marriages taking place annually. Housing gap Housing gap is about
Slide 6: 4Q 2019 Revenue summary
4Q 2019 Revenue summary Volume (mn sqm) Value (EGP million) 4Q2019 4Q 2018 % Change 4Q2019 4Q 2018 % Change Woven- Egypt based 13.76 14.55 1,430.1 1,586.5 -9.9% -5.4% 3.43 3.17 OW USA 504.7 567.1 -11.0% 8.2% 0.20 0.18 OW China 15.4 21.5 -28.6% 12.9% Tufted 8.31 8.63 466.4 488.8 -4.6% -3.8% Non-woven
Slide 7: 2019 Revenue summary
2019 Revenue summary Volume (mn sqm) Value (EGP million) 2019 2018 2019 2018 % Change % Change Woven- Egypt based 5,684.6 5,977.2 -4.9% 53.3 55.9 -4.6% OW USA 2,136.1 2,133.9 0.1% 13.5 11.4 18.8% OW China 66.8 80.9 -17.4% 0.8 0.9 -16.2% Tufted 1,758.4 1,778.9 -1.2% 31.6 30.9 2.2% Non-woven Felt 17.2
Slide 8: Export Market development
Export Market development Performance by region in 2019 Revenue Breakdown by region in 4Q 2019 Asia ▼ 6% Africa & GCC 3% 4% Europe Russia & China Europe Americas 38% ▼ 10% 20% Egypt ▼ 3% North & South ▲4% Asia America ▼10% ▼ 5% Egypt (local sales) ▼ -4% 35% Africa Arab Countries Slide 8
Slide 9: Export Market Development in 4Q 2019
Export Market Development in 4Q 2019 4Q 2019 4Q2019 Average Price Contribution to Volume Value in EGP Export Revenues 2019 2019 (y-o-y) (y-o-y) Volume Value Percentage ∆ 4Q 2019 4Q 2018 Woven ▼8% ▼20% ▼13% 73% 77% ▼3% ▼9% Tufted ▲6% ▼2% ▼8% 23% 20% ▲10% ▼1% Non-woven Felt ▲32% ▲27% ▼4% 4% 3% ▲58% ▲4
Slide 10: Export performance overview
Export performance overview Export revenues (EGPbn) Export vs. Local Revenue volume % Export volumes (mn sqm) Export Local 6.8 6.7 100% 6.3 71 80% 40% 34% 35% 38% 68 68 45% 3.5 3.7 60% 63 40% 60 60% 66% 65% 62% 55% 20% 0% 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Sli
Slide 11: Local Market Development in 4Q 2019
Local Market Development in 4Q 2019 4Q 4Q Contribution to 2019 2019 Percentage ∆ Volume Value Local Revenues Volume Value (y-o-y) (y-o-y) Average Price 4Q 2019 4Q 2018 Woven ▲7% ▲10% ▲3% 82% 78% ▲3% ▲6% Tufted ▼33% ▼13% ▲30% 10% 12% ▼20% ▼2% Non-woven Felt ▲7% ▲19% ▲11% 6% 5% ▲2% ▲19% Other (yarn sa
Slide 12: Local market overview
Local market overview Growing local revenues (EGPbn) Export vs. Local revenues% Local sales volumes (mn sqm) 3.8 Export Local 3.5 3.7 100% 54 3.0 34% 35% 80% 40% 45% 38% 51 2.3 60% 47 46 40% 45 60% 66% 65% 62% 55% 20% 0% 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Slid
Slide 13: Revenue progress
Revenue progress Revenues (EGPbn) Sales volumes (mn sqm) Export Local mn sqm Export Local EGPbn 10.2 10.4 10.1 116 10.0 117 115 114 111 3.5 3.7 3.8 8.0 6.8 54 47 46 45 5.8 51 6.0 3.0 2.3 4.0 6.8 6.7 6.3 63 68 68 71 2.0 60 3.5 3.7 - 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Slide 13
Slide 14: Diversified Product Mix
Diversified Product Mix 4Q 2019 Revenue Mix (by value) 4Q 2019 Revenue Mix (by volume) Other Woven- Non-woven 1% Non- woven Egypt Felt Felt based 4% Woven 16% 45% Egypt Tufted based 19% 58% OW China 1% Tufted 27% OW USA OW China OW USA 11% 1% 20% Woven-Grade A EGP237/sqm Tufted wall-to-wall EGP62/sq
Slide 15: 4Q 2019 Cost Breakdown
4Q 2019 Cost Breakdown PP Prices (USD/ton) OW China 1% Polypropylene- 2,000 USD /ton Nylon 24% 1,800 Other 1,629 1,585 1,584 20% 1,600 1,456 1,363 Backing 1,400 1,275 1,218 7% 1,130 Raw Material 1,200 1,103 1,055 Selling 54% 990 993 23% 1,000 800 600 Wool Depreciation 4% Finishing 400 4% Wages mater
Slide 16: CapEx Spending
CapEx Spending 2016 2017 2018 2019 2020 Woven 4 new goblin looms Establishing a 9 new looms 4 looms 3 weaving looms 9 new looms new factory Seven yarn Packing machines Dying machine 2 yarn production 10 new looms machines Yarn machine Wrapping machine lines One Heatset yarn machines Tufte
Slide 17: Financial Summary
Financial Summary EBITDA Performance (EGPbn) Net Income Performance Net Debt (EGPbn) EGPmn Net debt (EGP billion) EBITDA EBITDA margin EGPmn Net income Net margin 1,600 800 8% 1.5 16.5% 14.9% 16% 700 7.1% 7.6% 2 14% 600 6.7% 1,100 1.0 10.7% 500 11.1% 12% 4.8% 6% 1.2x 0.8x 1,523 400 0.8x 1 1,116 600
Slide 18: Impact of Energy Subsidy Reform on Costs
Impact of Energy Subsidy Reform on Costs % Jun-14 Jul-15 Jul-16 Jul-17 Jul-18 Jul-19 Energy cost Change Natural gas (US$/mmbtu) 2.25 5 5 5 5 5 - Electricity (EGP/KW) 0.28 0.435 0.53 0.69 0.99 1.1 11% Transportation costs (EGP Diesel/Liter) 1.1 1.80 2.35 3.65 5.5 6.75 23% * Energy cost represents les
Slide 19: Export Incentive Program
Export Incentive Program: Export cash Documents proceeds submitted to Export EGP546 mn delayed Subsidy Fund disbursement till July 2019 OW collected EGP 93 mn in 1H 2019 Export subsidies Exports (% of exports in EGP) Sources: Company Slide 19
Slide 20: Other Revenues Breakdown
Other Revenues Breakdown: 2019 Revenue breakdown (in EGP) 2018 Revenue Breakdown (in EGP) Sale of production Other remains, GAFI revenues*, Reversed 11,191,715 12,774,792 fees,… Export Export Rebate, Rebate, 218,248,982 136,379,39 6 Slide 20
Slide 21: Export Rebate Updates 2019/2020
Export Rebate Updates 2019/2020: • OW received a total of EGP 218 million in export rebates in 2019, with the current backlog standing at EGP 579 million as of 31st Jan 2020. • In December 2019: OW signed a settlement agreement with the Ministry of Finance and Ministry of Trade & Industry to settle
Slide 22: Share Data
Share Data o 443.4 mn shares at par value of EGP 1 per share. Shareholders’ structure o Issued and Paid-in Capital EGP 443.4 mn. o Listed in EGX since September 1997. Khamis Family 56.5% Institutions 37% o 3 Month average daily value EGP8.3mn. Foreign Institutions 23.6% o Market Cap USD 292 mn (as o
Slide 23: Disclaimer
Disclaimer Certain information contained in this document consists of forward-looking statements reflecting the current view of the Company with respect to future events and are subject to certain risks, uncertainties and assumptions. Many factors could cause the actual results, performance or achie
Slide 24: For More Information, please contact
For More Information, please contact Yasmine El Gohary Investor Relations Manager +202-22685166 yelgohary@orientalweavers.com www.orientalweavers.com Slide 24