Alliance Global Group Inc. · PSE:AGI
Alliance Global — FY2019 Earnings Presentation
41 slides from Alliance Global's earnings presentation, Jun 29, 2020
Slide 1: FY2019 Analysts' Briefing
FY2019 ANALYSTS’ BRIEFING 29 JUNE 2020 1
Slide 2: AGI 2019 P&L highlights
AGI 2019 P&L highlights AGI P&L highlights P&L highlights of subsidiaries In Pbn In Pbn Revenue share* 2018 2019 18% MEG EMP RWM GADC MEG 37% 180.0 67.3 EMP 16% RWM 156.8 GADC 51.5 29% 32.0 28.3 Attributable profit share* 17.9 0% 5% 23.7 27.1 17.7 7.0 MEG 15.1 1.9 32% 0.9 EMP RWM 63% Profit Profit R
Slide 3: AGI 2019 financial performance
AGI 2019 financial performance in Pbn Q419 Q418 % chg 2019 2018 % chg Comments Group revenues 53.0 48.0 10% 180.0 156.8 15% Megaworld 19.1 15.9 20% 66.8 56.9 17% Higher share of rentals; increased project completion Emperador 17.8 16.7 7% 51.5 47.0 9% Uptick in sales of higher-priced brandy products
Slide 4: AGI group historical performance
AGI group historical performance ALLIANCE GLOBAL MEGAWORLD REVENUE NET INCOME REVENUE* NET INCOME +7% CAGR +6% CAGR +11% CAGR +12% CAGR 180 157 18 62 18 139 139 54 133 15 15 15 15 47 14 13 42 42 11 10 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019
Slide 5: AGI group historical performance
AGI group historical performance EMPERADOR TRAVELLERS GOLDEN ARCHES REVENUE NET INCOME* GROSS REVENUE EBITDA REVENUE NET INCOME +6% CAGR -2% CAGR +6% CAGR -4% CAGR +9% CAGR +12% CAGR 34 1.9 52 7.7 6.4 32 7.0 6.2 1.7 1.6 47 7.0 28 44 43 6.7 28 27 5.5 41 6.3 26 25 23 1.2 21 20 3.0 0.8 2.2 2015 2016 20
Slide 6: Group borrowings
Group borrowings GROSS DEBTS, by key subsidiary AGI GEARING 209 0.49x 198 0.48x 181 36 0.42x 37 0 0.35x 144 35 1 118 1 60 45 30 31 20 2 0.17x 2 22 38 39 37 14 29 29 61 75 76 76 53 38.9 87.1 113.9 138.9 145.3 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Net debt (cash) Net debt/equity MEG EMP RW
Slide 7: Group gearing
Group gearing MEG EMP RWM GADC PARENT 0.36x 0.54x (0.2) 0.07x 1.24x 0.31x 0.31x 0.48x (1.2) (3.8) (4.9) (5.2) 0.46x -0.03x 0.06x 0.26x 0.37x 0.05x 0.22x 0.77x -0.19x 0.54x 0.03x 0.26x 0.03x -0.52x 0.00x 0.05x -0.57x -0.65x 29.8 44.8 58.5 58.2 52.8 (0.0) 19.2 28.0 33.0 29.5 1.9 11.6 23.7 35.1 48.2 11
Slide 8: Megaworld Corporation 2019 Performance Highlights
26 Townships & ILCs 4,688 Landbank (has) 3,637 Hotel room keys 1,312 Offices GLA (‘000) MEGAWORLD CORPORATION 2019 PERFORMANCE HIGHLIGHTS 721 Lifestyle malls GFA (‘000) 8
Slide 9: MEG: 2019 financial performance
MEG: 2019 financial performance P&L summary (Pbn) 4Q19 4Q18 YoY chg 2019 2018 YoY chg Comments Revenue 19.2 16.1 19% 67.3 57.4 17% Changing revenue mix Residential 11.9 10.5 13% 42.6 38.0 12% Higher project completion Office 2.8 2.3 20% 10.5 8.7 20% Capacity increases, rent adjustments Malls 1.7 1.5
Slide 10: MEG: Quarterly operational performance
MEG: Quarterly operational performance REVENUE EBITDA EBIT 17.0 7.6 8.3 15.6 15.4 0.7 0.2 14.8 6.7 6.9 14.0 0.7 0.6 7.3 7.5 0.2 6.4 6.5 6.4 0.1 13.3 13.5 0.5 7.0 7.1 7.0 0.1 4.4 0.1 5.7 0.1 12.2 0.3 0.6 0.2 0.2 5.7 0.1 0.1 0.3 4.2 4.3 6.2 6.2 0.1 0.1 0.4 3.8 0.1 0.1 3.6 3.4 3.7 3.9 0.1 0.1 4.3 3.0 3
Slide 11: MEG: Quarterly operational performance
MEG: Quarterly operational performance REAL ESTATE SALES RENTAL HOTEL vs GROSS PROFIT vs EBITDA vs EBITDA 46% 48% 94% 32% 46% 46% 45% 30% 45% 88% 88% 89% 88% 44% 44% 87% 88% 87% 28% 27% 25% 25% 12 23% 21% 4.4 10 11 11 4.2 4.3 3.8 3.9 710 10 9 9 3.7 672 9 3.4 3.4 574 587 489 4.3 4.0 4.0 5 3.4 3.7 3.7
Slide 12: Travellers International Hotel Group 2019 Performance Highlights
2,527 Hotel room keys 6 International Hotel Brands 80% Hotel occupancy 321 VIP and mass gaming tables TRAVELLERS INTERNATIONAL HOTEL GROUP, INC. 100 2019 PERFORMANCE HIGHLIGHTS Electronic Machines 12
Slide 13: RWM: 2019 financial performance
RWM: 2019 financial performance P&L summary (Pbn) 4Q19 4Q18 YoY chg 2019 2018 YoY chg Comments Revenue 7.2 6.5 12% 28.3 20.6 38% Gross gaming revenue 6.8 6.3 9% 27.6 20.0 38% Recovery in volume and hold rate. Mass 4.2 3.3 27% 16.0 12.3 31% Hefty increase in mass drop. Sustained growth in rolling vol
Slide 14: RWM: Quarterly operational performance
RWM: Quarterly operational performance AVERAGE DAILY GROSS REVENUES GGR: MASS vs VIP VISITORS 8.9 8.9 7.3 41 8.5 38 8.1 6.9 6.6 6.8 36 7.7 1.6 6.3 35 1.6 2.1 33 1.4 1.5 2.9 5.9 2.6 26 28 5.5 5.6 4.5 4.5 4.7 3.3 2.9 25 2.9 1.2 1.0 1.1 1.5 1.5 1.8 6.9 7.3 6.6 6.8 6.3 4.4 4.2 4.5 4.5 4.7 3.6 3.8 3.0 3.
Slide 15: Hotel Segment 2019 Performance Highlights
HOTEL SEGMENT 2019 PERFORMANCE HIGHLIGHTS 15
Slide 16: AGI: combined hospitality business 3,637 room keys
AGI: combined hospitality business 3,637 room keys Hotel Revenues Pbn +23% CAGR 7.5 5.0 4.2 3.3 3.8 2015 2016 2017 2018 2019 Hotel Room Keys Cumulative 6,189 4,691 2,357 3,198 1,368 2,639 1,782 357 916 208 3,323 3,807 2,282 2,282 1,574 2015 2016 2017 2018 2019 16 Metro Manila Provincial
Slide 17: Emperador Inc. 2019 Performance Highlights
1,513 Vineyards in Spain (has) 105 Countries under global distribution system 55 countries where EDI brands are exported 25 EMPERADOR INC. domestic sales 2019 PERFORMANCE HIGHLIGHTS offices 17
Slide 18: EMP: 2019 financial performance
EMP: 2019 financial performance P&L summary (Pbn) 4Q19 4Q18 YoY chg 2019 2018 YoY chg Comments Revenue 17.7 16.5 7% 51.6 47.1 10% Brandy 13.5 12.4 9% 37.6 33.7 12% Increasing share of higher-priced brandy products Whisky 4.2 4.1 3% 13.9 13.4 4% Growth capped by Brexit and currency translation Gross
Slide 19: EMP: Quarterly operational performance
EMP: Quarterly operational performance REVENUE ATTRIBUTABLE PROFIT* 17.7 16.5 1.9 2.0 4.2 4.1 1.7 1.7 12.4 1.6 1.6 0.6 11.0 0.6 1.5 1.5 11.0 10.4 0.4 9.7 9.8 0.5 0.4 0.7 3.6 0.4 0.3 3.2 3.3 2.8 2.8 3.3 13.5 12.4 1.4 1.4 1.3 8.7 1.1 1.2 1.2 1.1 1.2 6.9 7.9 7.7 7.7 6.5 Q118 Q218 Q318 Q418 Q119 Q219 Q3
Slide 20: EMP: Quarterly operational performance
EMP: Quarterly operational performance WHISKY REVENUE*, BRANDY REVENUE*, GROSS PROFIT, MARGIN GROSS PROFIT, MARGIN 45% 43% 42% 36% 40% 40% 34% 35% 38% 39% 33% 33% 30% 34% 27% 26% 4.3 4.1 13.6 13.0 3.7 3.3 3.4 3.2 2.8 2.8 9.3 7.9 7.8 7.7 7.0 6.6 1.6 1.6 1.3 1.4 1.4 1.4 1.1 1.1 3.5 3.2 3.4 2.3 2.4 2.5
Slide 21: EMP: Growing the whisky business
EMP: Growing the whisky business REVENUE MIX BRANDED BUSINESS BY REGION 12% 8% 7% 11% 12% 18% 20% 21% 20% 30% 9% 9% 15% 22% 23% 2% 4% 14% 11% 16% 11% 7% 17% 12% 23% 26% 73% 78% 76% 70% 70% 61% 53% 53% 45% 43% 2011-2014 2015-2017 2018 2019 2014 2015 2016 2017 2018 2019 Branded Business Private Label
Slide 22: Golden Arches Development Corporation 2019 Performance Highlights
669 GOLDEN ARCHES Store DEVELOPMENT CORPORATION count 386 McDelivery hubs 325 Stores with Drive-thru 5.8% GOLDEN ARCHES DEVELOPMENT CORPORATION Same store sales growth 2019 PERFORMANCE HIGHLIGHTS 22
Slide 23: GADC: 2019 financial performance
GADC: 2019 financial performance P&L summary (Pbn) 4Q19 4Q18 YoY chg 2019 2018 YoY chg Comments Sales Revenues 8.9 8.0 11% 32.0 28.3 13% Sales by co. restos 8.2 7.2 14% 28.8 25.6 12% Store expansion; better SSSG Rent, royalty & others 0.7 0.8 -13% 3.2 2.7 17% Increased number of franchised stores Gr
Slide 24: GADC: Quarterly operational performance
GADC: Quarterly operational performance SALES, SYSTEMWIDE SAME- STORE GEOGRAPHIC GROSS PROFIT, MARGIN STORE SALES GROWTH DISTRIBUTION 34% 7.0% 669 23% 23% 20% 24% 21% 21% 22% 6.6% 620 6.2% 566 55 6.6% 5.7% 5.8% 520 51 70 6.0% 481 45 64 4.8% 40 4.4% 5.5% 56 4.9% 5.1% 35 48 4.8% 45 284 249 221 3.8% 4.
Slide 25: Infracorp
INFRACORP AN ALLIANCE GLOBAL COMPANY
Slide 26: Foray into infrastructure
Foray into infrastructure Fort Bonifacio-Makati Skytrain NAIA upgrade Oct 2017 Feb 2018 Submission of Submission of unsolicited proposal unsolicited proposal May 2018 May 2018 DOTr grant of Original Proponent Status DOTr grant of Original Proponent Status Sep 2019 NEDA ICC approval On-going NEDA eva
Slide 27: Impact of the pandemic on the AGI Group
Impact of the pandemic on the AGI Group 27
Slide 28: Impact of the pandemic on the residential segment
onpandemic Impact of the residential on AGIsegment Group TARGETS RESIDENTIAL Increasing share of projects outside MM Project Launches During Quarantine • Work stoppage in construction sites and slowdown in the supply 10% 21% 28% chain have resulted in delays in project completion/turnover. • Job sta
Slide 29: Impact on Megaworld Premier Offices
Impactof Impact onpandemic Megaworld onPremier Offices AGI Group TARGETS OFFICES OFFICE GLA (‘000) During Quarantine 1,707 • Temporary closure of POGO operations but with no rental holiday. 1,421 1,487 • Uninterrupted BPO operations, with 50/50 WFH/office. 1,312 1,119 • BPOs provide office employees
Slide 30: Impact on Megaworld Lifestyle malls
onpandemic Impact of Megaworld onLifestyle AGI Groupmalls TARGETS LIFESTYLE MALLS LIFESTYLE MALLS GFA (‘000) 872 878 During Quarantine • Temporary mall closures except for areas tenanted by essential 721 businesses where operations were limited. 643 • Rental holidays given to affected tenants. 533 4
Slide 31: Impact on the hospitality business
onpandemic Impact of the hospitality on AGIbusiness Group TARGETS HOSPITALITY During Quarantine • Overall hotel operations affected by travel bans, lockdowns. • Partial operations for in-city hotels due to BPOs, repatriated 2020 2021 2022 Filipinos. • Temporary closure of resort hotels. • 191-room •
Slide 32: Impact on the leisure and entertainment business
onpandemic Impact of the leisureon and entertainment AGI Group business TARGETS LEISURE & ENTERTAINMENT During Quarantine • Closure of gaming operations since 17 March. • Closure of non-gaming operations • Resume development (e.g, theaters, retail outlets, etc) and MICE activities at Westside City a
Slide 33: Impact on the spirits business
onpandemic Impact of the spiritson business AGI Group TARGET SPIRITS During Quarantine • EDI: temporary halt in liquor operations; sales affected by liquor ban imposed by most LGUs during ECQ. • WMG: continuous operations even during the pandemic; sales impact from temporary closure of bars/clubs mi
Slide 34: Impact on the quick service restaurant segment
onpandemic Impact of the quick service restaurant segment on AGI Group TARGETS QUICK SERVICE RESTAURANT • Cut back on During Quarantine company-owned • Limited store operations during ECQ. store openings. • Sales activities limited to take-outs, delivery services and drive thrus; in-dining not allow
Slide 35: Impact on the infrastructure segment
onpandemic Impact of the infrastructure segment on AGI Group TARGETS INFRASTRUCTURE During Quarantine • No government action on pending PPP • Review of the applications. economics of the planned Skytrain project and the Update NAIA Rehab project • Government is reviewing all applications, with is on
Slide 36: Initiatives
Al GCE GLOBAL. in pet YA ALLIANCE GLOBAL Initiatives
Slide 37: AGI: Digital transformation program
AGI: Digital transformation program Keyless entry in Online payment Upgrade in EMP facilities Development of residential units channels available and technology in brandy e-commerce platforms and whisky-making Restaurant and hotel McDelivery More NXTGEN stores reservations thru RWM App hubs nationwi
Slide 38: AGI Group: Response to the pandemic
AGI Group: Response to the pandemic P100M P250M P66M P60M Donation to 1-M liters of AGI and subsidiaries’ COVID-19 test labs Project Ugnayan disinfectant alcohol donation to LGUs and to PH Red Cross through EMP other organizations from MEG P5M P1M P500M P125M Meals for frontliners, LGUs, Distributio
Slide 39: Group investment commitment
Group investment commitment AGI’s capex by major subsidiary In Pbn 79 71 70 • Capex spent in 2019: 2 2 63 3 12 63bn. 11 15 2 2 9 2 11 42 2 1 4 1 • 2020 target capex 49 51 48 60 36 reduced to P42bn (from original P79bn) as Group shifts to 2017 2018 2019 2020E 2020E ORIGINAL REVISED cash preservation
Slide 40: Group share buyback program
Group share buyback program AGI EMP MEG 64% 73% 9% • P1.6bn (64%) already • P2.2bn (73%) already • P472m (9%) utilized out of utilized out of the P2.5bn utilized out of the P3.0bn the P5.0bn program. program. program. • 185m shares bought back, • 141m shares bought back, • 322m shares bought back, a
Slide 41: End of presentation
FY2019 ANALYSTS’ BRIEFING End of presentation 44