Ctf Services Limited · HKEX:659
Ctf Services — NWS Holdings — H1 FY2021 Earnings Presentation
40 slides from Ctf Services's earnings presentation, Feb 26, 2021
Slide 1: FY2021 Interim Results Analyst Presentation
FY2021 Interim Results Analyst Presentation 26 February 2021 New World Group Member NWS Holdings Limited © All rights reserved
Slide 2: Table of Contents
Brand Story Table of INVEST FOR Contents NWS Transformation 2018-2021 & Financial Summary Section 1 PURPOSE Core Business & Strategic Portfolio Highlights Section 2 Environment, Social & Governance Section 3 Appendices
Slide 3: Strategic Roadmap
Brand Story Drive value for shareholders via acquisition, non-core disposals and sustainable & progressive dividend Strategic INVEST FOR Roadmap Disposals of non-core assets PURPOSE • BCIA • Hip Seng Group • Tianjin Orient Container Terminals • Tianjin Five Continents Int’l Container Terminal • New
Slide 4: Business portfolio revamp: NWS Transformation 2018-2021
Business portfolio revamp Stronger & improved business fundamentals NWS 2018 2021 Infrastructure Core Business Transformation 2018 - 2021 Roads Aviation Environment Logistics Roads Aviation Construction Insurance • Prior to 2018, NWS business Services Strategic Portfolio strategy is conservative and
Slide 5: Portfolio optimization further strengthened NWS fundamentals
Portfolio optimization further strengthened NWS fundamentals NWS Transformation 2018 – 2021 Newly acquired Disposed business Robust & resilient Dynamic business earnings contribution balance sheet 3 Roads in Central Transport Newly acquired China Value business crystalisation FTLife Insurance FY2018
Slide 6: Future growth plan focusing on Roads, Modern Logistics, Insurance
Future growth plan focusing on Roads, Modern Logistics, Insurance NWS Core Business Strategic Portfolio Transformation in the next Roads Aviation Construction Insurance Logistics Facilities 3 years Management Growth strategy Roads Modern Logistics Partnership with SOE & major PRC investor Warehouse
Slide 7: Sustainable & progressive dividend policy supported by strong balance sheet
Sustainable & progressive dividend policy supported by strong balance sheet Over 17 consecutive years of dividend & counting Dividend Policy 50% payout on net profit Sustainable & progressive dividend policy on absolute DPS DPS (HK$) • Once business stabilized plenty room for growth 0.72 0.39 0.46 0
Slide 8: Prudent financial policy underpinning growth & external shocks
Prudent financial policy underpinning for growth & external shocks Financial Well-managed maturity profile allowing financial flexibility for operations, potential investments & growth plans Debt maturity profile(1) (as of 31 Dec 2020) Policy 49% Unutilized committed Ample cash on hand 34% banking f
Slide 9: Business at a Glance
Business at Core a Glance Business ROADS AVIATION CONSTRUCTION INSURANCE 15 toll roads in the PRC Goshawk Aviation Limited Hip Hing Group provides FTLife Insurance (total length of c.740 km) provides commercial professional construction Company Ltd aircraft leasing & services in HK managemen
Slide 10: Strong rebound with potentials yet to be fully reflected
Strong rebound with potentials yet to be fully reflected NWS Strong AOP contribution Short term catalyst Mid - Long term growth Post COVID-19 with robust rebound (PRC border reopens) (COVID-19 impact fades further) Recovery Roads Strong traffic recovery Insurance Well positioned for a strong Air
Slide 11: Financial highlights
Financial highlights 2019 2020 YoY For the six months ended 31 Dec (HK$MM) (HK$MM) change % Revenue - full period contribution of FTLife Revenue(1) 11,283.6 14,232.5 26 Attributable Operating Profit (AOP)(2) 2,289.9 3,336.3 46 • Rapid recovery with 13% yoy growth Core Business 2,048.1 2,322.2 13 • R
Slide 12: Performance by segment
Performance by segment 2019 2020 YoY change For the six months ended 31 Dec (HK$MM) (HK$MM) % Roads Rapid traffic recovery after resumption of 949.6 1,061.0 12 Core Business toll fee collection. Excluding RMB Aviation 267.9 271.7 1 appreciation, AOP +8%. Construction 670.2 527.1 (21) Less gross prof
Slide 13: Core Business
Sa #7 B32 NWS Core Business
Slide 14: Roads: Swift recovery with positive outlook
Core Business Swift recovery with positive outlook Segment AOP Roads ► Overall portfolio traffic volume +9% yoy • 4 anchor expressways (c. 80% of Roads AOP) traffic volume +4% yoy HK$MM 15 toll roads in PRC (c. 740km) YoY 12% 1,061 ► Overall portfolio toll income +8% yoy 950 ► Compensation measures
Slide 15: Aviation: Showing signs of stabilization
Core Business Showing signs of stabilization Aviation ► Industry stabilizing attributable to gradual resumption of domestic flights, Segment AOP creation of air travel bubbles and various support from Govt & financial HK$MM Goshawk market Aircraft leasing & management YoY 1% ► No. of requests for ne
Slide 16: Construction: Reputable contractor poised for long term growth
Core Business Reputable contractor poised for long term growth Construction ► New contract awarded during FY2021-1H: HK$1Bn(1) Segment AOP HK$MM ► Hip Hing Group ► Some delay in tenders coming to the market due to COVID-19 ► Inv in Wai Kee (c. 23%) YoY -21% ► Maintained a balanced source of projects
Slide 17: Insurance: Consistent performance with potential yet to be fully realized
Core Business Consistent performance with potential yet to be fully realized Segment AOP Insurance ► Solid execution capability, agile business strategy & deliberate shift of focus by management drives outperformance of HK business vs industry as reflected in HK$MM FTLife Insurance Q3 2020 APE YoY Q
Slide 18: Strategic Portfolio
i — ae #7 B32 NWS = Strategic Portfolio
Slide 19: Logistics: Solid performance
Strategic Portfolio Solid performance Logistics ► ATL Logistics Centre (ATL) (Contributed c.70% of Logistics AOP) Segment AOP • Leader in the segment in HK with strong competitive edge HK$MM • Almost fully occupied with stable average rent growth YoY ► CUIRC -1% • Remarkable throughput growth at 30%
Slide 20: Facilities Management: Improved performance despite tough environment
Strategic Portfolio Improved performance despite tough environment Segment AOP Facilities ► GHK Hospital – Ramping up rapidly & AOL narrowed Management • Outpatient & inpatient admission +18% & +31% yoy HK$MM • New service centres & decent ramp up of clinic after relocated to New YoY 11% World Tower
Slide 21: Discontinued operations: Environment
Discontinued operations Environment ► SUEZ NWS & Derun Environment Segment AOP • Announced disposal of SUEZ NWS & Derun Environment in Jan 2021 at HK$MM a total consideration of HK$6.5Bn YoY -1% • Attractive valuation with implied FY2020 P/E: ‒ SUEZ NWS: c. 18x ‒ Derun Environment: c. 16x 247 244 ►
Slide 22: Environment, Social & Governance (ESG)
Environment, Social & Governance (ESG)
Slide 23: ESG ratings and recognitions
Brand Story ESG ratings and recognitions (as of 9 Feb 2021) Achievements INVEST in FORESG PURPOSE Overall Rating: AA+ Best Corporate Governance Award 2020 Up from AA in 2019 Gold Award in the Non-Hang Seng Index Performance Successfully listed on Hang Seng Corporate (Medium Capitalization) Categ
Slide 24: Sustainability financing
Brand Story Sustainability financing Achievements INVEST in FORESG NWS First Sustainability-linked Loan PURPOSE On 29 June, NWS announced first sustainability-linked loan of HK$1Bn with Crédit Agricole Corporate and Investment Bank 2020 2021 Second Sustainability-linked Loan In Feb 2021, NWS ann
Slide 25: Climate resilience key initiatives
Brand Story Key initiatives INVEST Climate FOR Resilience • Initiated Transition Risk Assessment towards low carbon economy in 2021 (updated Feb 2021) PURPOSE Measures • NWS’ 2nd Sustainability-Linked Loan of HK$1 billion with Bank of America in Feb 2021 • Climate Change Policy established (along wi
Slide 26: Appendices
Appendices |RESTRICTED|
Slide 27: Corporate Structure
Chow Tai Fook (Holding) Limited Corporate Structure 17.HK 1929.HK Market Cap: HK$104Bn Market Cap: HK$111Bn 100% 61% 75% 825.HK Market Cap: HK$2.1Bn 659.HK Market Cap: HK$36Bn Note: Market cap as at 25 Feb 2021 27
Slide 28: Optimization of business
Optimization of business Acquisition B A Hubei Suiyuenan Expy Hubei Sui-yue Expy Hunan Changliu Expy Maintain Sky Aviation Leasing Int’l Ltd FTLife Insurance Co Ltd healthy gearing level Capital FY2018-2H FY2019 FY2020 1H FY2021 2H recycling Hip Seng Group Shares of Beijing Capital Healthcare Assets
Slide 29: Financial highlights
Financial highlights 30 Jun 2020 31 Dec 2020 As at (HK$MM) (HK$MM) Total cash & bank balances 13,221.8 10,987.6 Total debt 30,955.7 26,288.6 Net debt position 17,733.9 15,301.0 Net gearing ratio 31% 26% Net Gearing Ratio 40% 35% 30% 26% 25% 20% 15% 10% 5% 0% FY2011 FY2012 FY2013 FY2014 FY2015 FY2016
Slide 30: AOP by segment and geography
AOP by segment and geography Core Business Others 11% represents 70% of AOP Mainland FY2020 China Hong Kong 34% Interim 55% 23% 32% 16% 14% 8% 10% 7% Others -10% 10% Roads Aviation Construction Insurance Strategic Discontinued Portfolio Operations FY2021 Hong Kong Mainland China 48% Interim 42% Logi
Slide 31: Portfolio of toll roads in PRC c.740 km
Appendix Portfolio of 15 toll roads in PRC c.740 km Roads Guangdong Zhejiang Hubei Tianjin Shanxi Hunan # of Roads 7 1 1 1 3 2 Length 313.9 km 103.4 km 98.06 km 60.67 km 76.52 km 89.08 km Concession Expiry 2023–2035 2029 2040 2039 2023–2025 2038-2043 Cumulative Average Daily Traffic Flow (‘000) 1,27
Slide 32: Goshawk Aviation – Leading global aircraft leasing platform
Appendix Goshawk Aviation – Leading global aircraft leasing platform Aviation As at 31 Dec 2020, 162 aircraft on book(1) Aircraft Type Geographical Spread Others 21% Europe A320/A321 Asia and 16% 48% Middle-East 60% B737 America 31% 16% Others 8% Aircraft leasing portfolio Fleet size as of 31 Dec 20
Slide 33: FTLife Insurance investment portfolio
Appendix FTLife Insurance investment portfolio (as of 31 Dec 2020) Investment Portfolio AUM* (HK$’M) Asset Types Insurance 56,280 46,749 Equities 35,011 13% Fixed Income 76% Private Funds 2% Other assets & cash 2018 2019 2020 9% * Exclude Investment-Linked Assurance Scheme business Geographical Dist
Slide 34: Strategic investments in logistics in Greater China
Appendix Strategic investments in logistics in Greater China Logistics CUIRC Urumqi Jilin Inner • JV with China State Railway Group, Mongolia PSA, CIMC & Deutsche Bahn Liaoning Xinjiang • 12 large-scale rail container terminals in Beijing Port Dalian the PRC Tianjin • 1 port project in Xiamen Hebei
Slide 35: Transaction Update
Transaction Update Disposal of Interests in SUEZ NWS Limited (“SUEZ NWS”) and Chongqing Derun Environment Co., Ltd. (“Derun”)
Slide 36: NWS crystalizes value via disposal of SUEZ NWS & Derun
NWS crystalizes value via disposal of SUEZ NWS & Derun Transaction Summary Transaction Valuation On 11 January 2021 after trading hours, NWS announced the disposals of the majority of its assets within the Environment segment to its long term partner HK$m SUEZ NWS Suyu Suez, including its: Conside
Slide 37: Transaction rationale and benefits
Transaction rationale and benefits 1 Crystalizes investment value of SUEZ NWS & Derun for NWS shareholders ‒ Current value of investments in SUEZ NWS and Derun are not fully recognized by the market: significant Holdco discount due to complex shareholding structure in SUEZ NWS and Derun ‒ Exit multi
Slide 38: Overview of SUEZ NWS & Derun
Overview of SUEZ NWS & Derun SUEZ NWS Derun Engages in the provision of (1) water and wastewater treatment, (2) recycling and Shareholding structure at announcement Sanfeng waste recovery, (3) treatment infrastructure services and (4) smart environmental Invests in waste incineration power solut
Slide 39: nt fall NWS
—— a nt fall 32 NWS
Slide 40: Disclaimer
Disclaimer NWS Holdings Limited (“NWS”) makes no representation or warranty of any kind, express, implied or statutory regarding the accuracy or completeness of the information contained. It is not the intention to provide, and you may not rely on this presentation as providing, all material informa