Kuwait Projects Company Holding (K.S.C.P.) · KSE:KPROJ
Kuwait Projects Company Holding (K.S.C.P.) — Kuwait Projects Company Holding (KIPCO) — Debt Investor Presentation (September 2012)
36 slides from Kuwait Projects Company Holding (K.S.C.P.)'s debt investor presentation, September 2012
Slide 1: Debt Presentation September 2012
Year of Building Order D Debt Presentation September 2012 1
Slide 2: Disclaimer
Disclaimer This presentation is not an offer or invitation to subscribe to or purchase any securities. No warranty is given as to the accuracy or completeness of the information in this presentation. You must make your own independent investigation and appraisal of the business and financial conditi
Slide 3: Index
Index Key Investment Highlights Our Business, Strategy and Team Performance Update & Key developments Debt Metrics Conclusion Annexure Bloomberg Ticker: KPROJ KK Reuters Ticker: KPRO.KW 3
Slide 4: Introduction: Key Investment Highlights
Introduction: Key Investment Highlights Proven Track IRR of 40% on fully realized investments and 21% on all investments (realized and Record unrealized) over the last 14 years 1 Ruling Family Al Futtooh Investments (AFH) owned by members of Kuwaiti ruling family have a Shareholders controlling stak
Slide 5: Index
Index Key Investment Highlights Our Business, Strategy and Team Performance Update & Key developments Debt Metrics Conclusion Annexure 5
Slide 6: Our Business, Strategy and Team
Our Business, Strategy and Team KIPCO is a multi-sector operating holding company with a diversified portfolio spanning the GCC and wider MENA region OUR BUSINESS AUM of US$25 billion1 Present in 16 MENA countries Mainly financial services and media; profitable for the last 20 consecutive years OUR
Slide 7: Our Presence by Geography & Sectors
Our Presence by Geography & Sectors Major Sectors Geography Asset Commercial management Revenues1 Insurance Media Real Estate Industrial Others banking & investment (2011) banking Kuwait ● ● ● ● ● ● ● 49% UAE ● ● ● 6% Bahrain ● ● ● ● 6% KSA ● ● ● 5% Jordan ● ● ● ● ● 15% Algeria ● ● ● ● 7% Others ● ●
Slide 8: KIPCO: Strategic Roadmap
KIPCO: Strategic Roadmap Building Businesses Regional Thought Outlook leadership Investing Strong in engines managerial Being first Diversified MENA of growth revenue expertise in the streams region Target Team Approach ROE: 20% Balanced Portfolio Investment in companies with sustainable and predict
Slide 9: Controlling or Majority Stakes
Controlling or Majority Stakes Business Commercial Asset Management & Insurance Media Real Estate Segments Banking Investment Banking (AMIB) Main Entities KIPCO Effective 60.1% 96.1% 82.4% 3 44.8% 60.4% 61.9% Stakes 1 Board 6 of 9 6 of 6 6 of 6 4 of 104 2 of 75 4 of 7 Representation Market Cap 2,604
Slide 10: Supportive Shareholder With Ruling Family Links
Supportive Shareholder With Ruling Family Links Shareholding Profile (June 2012) Kuwaiti Ruling Family Support Treasury Retail KIPCO’s principal shareholder is Al Futtooh Holding Investors Shares 2.5% Company K.S.C. (Closed) (“AFH”), a Kuwaiti 6.1% HNIs company owned by members of the Kuwaiti ruling
Slide 11: Index
Index Key Investment Highlights Our Business, Strategy and Team Performance Update & Key developments Debt Metrics Conclusion Annexure 11
Slide 12: Summary: 2012
Summary: 2012 Net profit grew by 23% from US$90 million in H1’11 to US$111 million in H1’12 − Driven by 11% growth in operating income Strong CAR of 18% and comfortable liquidity levels Net profits grew by 24% from US$13.3 mn in H1’11 to US$16.5 mn in H1’12 − Driven by 88% growth in higher inc
Slide 13: Performance Update (cont'd)
Performance Update (cont’d) Financial Discipline KIPCO diversified, extended and optimized its liability and liquidity profile − Completed US$ 287 million (KD80 million) KD bond issue and prepaid partial term Prudent Risk loan of US$115 million in January 2012 (details on next slide) Management − Re
Slide 14: Key Development: Liability & funding cost optimization
Key Development: Liability & funding cost optimization On 16th January 2012, KIPCO completed a 4 year KD denominated bond of KD80 million (US$ 287 million) Key terms: Maturity: 4 year bullet maturing 15th January 2016 Pricing: Tranche 1: Fixed rate @4.75% Tranche 2: Floating rate @ Kuwait central ba
Slide 15: Liability & funding cost optimization…cont'd
Liability & funding cost optimization…cont’d Use of proceeds: 1. Prepaid KD32 million (US$115 million) of outstanding KD72 million (US$258 million) of term loan 2. Remaining held as cash to be used for selective prepayments of debt Better terms on remaining KD40 million term loan: Removed Maturity:
Slide 16: Kuwait Development Plan Update
Kuwait Development Plan Update What has happened so far? US$108 billion 4 year plan starting FY 2010/11 The political situation in Kuwait has slowed down the execution of development plan US$18 billion allocated for FY 2010/11 of which US$11.4 was spent US$19 billion allocated for FY 2011/12; actual
Slide 17: Burgan Bank (BB): Strongly Capitalised
Burgan Bank (BB): Strongly Capitalised BB, the commercial banking arm of KIPCO group, today has become a regional player with market leadership in Jordan, Iraq, Tunisia and Algeria Business Highlights Key Subsidiaries CAR of 17.9% as on Jun 30, 2012, Market % Name Market Position Cap (US$ Country
Slide 18: United Gulf Bank (UGB)
United Gulf Bank (UGB) UGB, the Asset Management and Investment Banking arm of KIPCO Group, is focused on growing the financial services network across the MENA region Business Highlights Key Subsidiaries and Associates Bahrain-based financial services group listed on the Market Market Position Coun
Slide 19: Gulf Insurance Company (GIC)
Gulf Insurance Company (GIC) GIC, the insurance arm of KIPCO, is amongst the top 6 insurance players in the MENA Region Business Highlights Key Subsidiaries/Associates Kuwait-based insurance company listed on the KSE Market Market Coun % Name Cap Presence across the MENA region position -try Stake1
Slide 20: OSN
OSN MENA1 TV Overview Million MENA Region Latin America UK India US 331 551 62 1,191 310 Population 63 NA 26 225 132 Households 54 120 25 135 116 TV Households 2 37 14 112 102 Pay TV 85% NA 94% 60% 88% TV HHs /HHs (%) 3% 30% 54% 83% 88% Pay TV/ TV HHs (%) Market Capitalization of #1 N/A 32.9 20.2 1.
Slide 21: OSN (Cont'd)
OSN (Cont’d) The #1 pay-TV platform by revenue in the MENA region Business Highlights Geographical Presence (24 countries) Largest pay TV operator in MENA by revenues Syria Tunisia C yprus Morocco Le banon Iran Serving a population base of 410 million Pale stine Iraq Kuwait Jordan Bahrain Alge ria L
Slide 22: OSN (Cont'd)
OSN (Cont’d) Subscribers Net Adds Thousand Thousand 672 40 39 564 601 37 526 33 495 30 Q2'11 Q3'11 Q4'11 Q1'12 Q2'12* Q2'11 Q3'11 Q4'11 Q1'12 Q2'12 Churn Subscribers by country (June’ 2012) 23% 20% 20% KSA Others 24% 17% 17% 26% Egypt 9% UAE Bahrain 29% Q2'11 Q3'11 Q4'11 Q1'12 Q2'12 3% Kuwait 9% 201
Slide 23: United Real Estate Company (URC)
United Real Estate Company (URC) URC is a major real estate player in Kuwait, ranked second based on its revenues on KSE Business Highlights Country Key Projects Operations across the Middle East region through a Kuwait United Tower, Al Shaheed Tower, Marina World, mix of fully-owned properties, sub
Slide 24: KIPCO Consolidated: Financial Performance
KIPCO Consolidated: Financial Performance Revenues Net Income Consolidated Assets US$ million US$ million US$ billion 1,434 1,466 22.1 21.0 20.3 1,261 162 19.1 132 108 767 638 59 61 2009 2010 2011 H1'11 H1'12 2009 2010 2011 H1'11 H1'12 2009 2010 2011 H1'12 Note: Exchange rate of US$=0.28010KD 24
Slide 25: Index
Index Key Investment Highlights Our Business, Strategy and Team Performance Update & Key developments Debt Metrics Conclusion Annexure 25
Slide 26: KIPCO (Parent): Debt Metrics
KIPCO (Parent): Debt Metrics (US$ million) Financial KIPCO (Parent) Dec 31, 2010 Dec 31, 2011 June 30, 2012 Targets Cash & Cash Equivalents 1,022 423 681 Gross Debt 1,894 1,248 1,418 Net Debt 873 825 737 Shareholders’ Equity 2,018 2,072 2,028 Net Parent Debt / Shareholders’ Equity <2.5x 0.43x 0.40x
Slide 27: KIPCO (Parent): Cash Coverage
KIPCO (Parent): Cash Coverage Infinite 1,355 x Infinite 4.8x Current cash sufficient 681 681 680 680 to meet all debt obligations till 2015 - - 143 1 June'12 Dec'2012 Dec'2013 Dec'2014 No short term Cash ST Debt Short Term Debt Coverage debt in near and medium term Sufficient cash coverage with no s
Slide 28: KIPCO Parent Debt Profile
KIPCO Parent Debt Profile Debt Type as at H1’12 Debt Maturity as at H1’12 Total Debt: US$ 1.4 billion Total Debt: US$ 1.4 billion 1-2 years 0.04% Term Loan 10% 2-4 years 30% Bonds 20% MTN 70% > 4 years 70% Enhanced Debt1 Maturity Profile Liquidity KIPCO has cash & bank balance of US$681 5.3 yrs mill
Slide 29: Index
Index Key Investment Highlights Our Business, Strategy and Team Performance Update & Key developments Debt Metrics Conclusion Annexure 29
Slide 30: Conclusion
Conclusion Proven strategy and experienced management team Little impact of recent turmoil in the region on our businesses Operating performance Prudent financial of our businesses management continues to improve Resulting in strong liquidity Increased visibility on with no refinancing risk operatin
Slide 31: Thank You
Thank You
Slide 32: Index
Index Key Investment Highlights Our Business, Strategy and Team Performance Update & Key developments Debt Metrics Conclusion Annexure 32
Slide 33: United Industries Company (UIC)
United Industries Company (UIC) UIC seeks to be a leading regional investment house with activities in the industrial sector Business Highlights Key Subsidiaries/Associates Established in 1979, UIC operates as a holding Name Sector Country % Stake1 company for the Group’s industrial investments Kuwa
Slide 34: KIPCO: Huge Value Potential for Investors
KIPCO: Huge Value Potential for Investors No Repayment risk Has sufficient cash to service all debt obligations till 2015 (4.8x coverage) Proactive liability Minimal credit risk management Strong secondary market and Average debt maturity of 5.3 strong investor performance of bonds years confidence
Slide 35: Glossary
Glossary AUM: Assets under Management CAR: Capital Adequacy Ratio GPW: Gross Premiums Written IRR: The IRR provided in the Track record (Slide 4) is the leveraged gross IRR (it includes interest expense) and reflects the returns to KIPCO’s shareholders as of Dec 31, 2010. The information concerning
Slide 36: Kuwait Development Plan
Kuwait Development Plan Purpose: Overview − Upgrade infrastructure − US$108 billion 4 year plan − Diversify non oil revenue − FY 2010/11 – Approved at US$18 billion comprising of 884 projects − Create employment − FY 2011/12 – Estimated at US$18.7 billion comprising of 1,240* projects − Develop
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