Ctf Services Limited · HKEX:659
Ctf Services — NWS Holdings — FY2018 Earnings Presentation
44 slides from Ctf Services's earnings presentation, September 2018
Slide 1: NWS Holdings Limited FY2018 Annual Results
NWS Holdings Limited FY2018 Annual Results 1
Slide 2: Background
Background Chow Tai Fook (Holding) Limited New World Development Chow Tai Fook Jewellery Group (17.HK) (1929.HK) Market Cap – HK$103B Market Cap – HK$77B NWS Holdings (659.HK) Market Cap – HK$56B Infrastructure Services Roads Facilities Management Environment Construction & Transport Logistics Strat
Slide 3: Agenda
Agenda • Result Highlights • Financials • Segment Updates • Outlook • Q&A 3
Slide 4: Result Highlights
Result Highlights Financial Performance Robust growth & record results • Revenue up 12% to HK$35B • AOP up 8% to HK$5.2B • PAT up 8% to HK$6.1B Infrastructure AOP up 21% • Mainly driven by Roads, Environment and Aviation • Healthy organic and acquisition growth Services AOP down 16% • Good per
Slide 5: Result Highlights
Result Highlights Infrastructure Roads (AOP up 32%) Traffic up 10% 6-month AOP from Suiyuenan Expressway Environment (AOP up 26%) SUEZ NWS – water sales and wastewater treatment volume up 9% Derun – steady organic growth; extra capacity; lump sum VAT subsidy Logistics (AOP up 2%) ATL – occ
Slide 6: Result Highlights
Result Highlights Services Facilities Management (AOP down 124%) Steady performance of HKCEC offset by full-year loss of GHK Hospital during its ramp-up phase Free Duty losses narrowed in 2HFY2018 Construction & Transport (AOP up 7%) Construction – vibrant property market and strong order book
Slide 7: Financial Summary
Financial Summary 2018 2017 Change For the year ended 30 June (HK$'M) (HK$'M) (%) Revenue 35,114.8 31,385.0 12 Attributable Operating Profit (AOP) 5,231.9 4,840.3 8 Profit Attributable to Shareholders 6,068.8 5,628.9 8 (PAT) Basic Earnings per share (HK$) 1.56 1.46 7 Dividend per share (HK$) 0.78 1.
Slide 8: Financial Position
Financial Position As at As at 30 Jun 2018 31 Dec 2017 (HK$'M) (HK$'M) Total cash and bank balances 6,657 6,421 Total debt 10,175 12,570 Net debt position 3,518 6,149 Total equity 50,124 48,874 Net gearing ratio 7% 13% 8
Slide 9: AOP by Division (Two-pillar approach)
AOP by Division (Two-pillar approach) FY2018 AOP HK$5,232M FY2017 AOP HK$4,840M 28% 35% 65% 72% 9
Slide 10: AOP by Region
AOP by Region FY2018 AOP HK$5,232M FY2017 AOP HK$4,840M Other Other Territories Territories 10% 11% Hong Kong 39% Hong Kong 46% Mainland Mainland China China 44% 50% 10
Slide 11: Dividend Per Share
Dividend Per Share Dividend Payout Ratio 50% 50% 50% 51% 100% 50% HK$ 1.5 1.45 1.2 0.9 0.78 0.72 0.65 0.58 0.60 0.6 0.55 0.26 0.22 0.33 0.34 0.39 0.46 0.3 0.29 0.36 0.27 0.31 0.34 0.32 0 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 11
Slide 12: Infrastructure Division
Infrastructure Division 2018 2017 Change For the year ended 30 June (HK$'M) (HK$'M) (%) Roads 1,947.1 1,479.1 32 Environment 494.1 392.1 26 Logistics 654.6 641.2 2 Aviation 695.2 610.5 14 Total 3,791.0 3,122.9 21 12
Slide 13: Infrastructure Roads - Overview
31% Infrastructure FY2017 AOP Roads - Overview 37% FY2018 AOP • 15 projects in Guangdong, Guangxi, Shanxi, Zhejiang, Tianjin and Hubei • Total length approx. 700km • Immediate AOP from Suiyuenan Expressway 13
Slide 14: Roads – Highlights (Cont’d)
Infrastructure Roads – Highlights (Cont’d) Overall traffic up 10% (excluding Suiyuenan Expressway) Average Daily Traffic Flow Vehicles ‘000 400 345 319 300 182 194 200 100 79 83 52 62 0 Guangzhou City Beijing-Zhuhai Expressway Hangzhou Tangjin Expressway Northern Ring Road (Guangzhou-Zhuhai Sectio
Slide 15: Roads – Highlights (Cont’d)
Infrastructure Roads – Highlights (Cont’d) AOP up 32% (10% without RMB impact) Average Daily Toll Revenue RMB ‘000 6,000 5,664 5,380 5,000 4,000 3,491 3,684 3,000 2,132 2,212 1,951 2,000 1,532 1,000 0 Guangzhou City Beijing-Zhuhai Expressway Hangzhou Tangjin Expressway Northern Ring Road (Guangzho
Slide 16: Roads – Highlights (Cont’d)
Infrastructure Roads – Highlights (Cont’d) Traffic Mix Guangzhou City Northern Ring Road (“GNRR”) Beijing-Zhuhai Expressway (Guangzhou-Zhuhai Section) (“BZE”) 100% 100% 29% 26% 16% 15% 16% 31% 30% 22% 20% 19% 80% 80% 60% 60% 40% 40% 71% 74% 84% 85% 84% 69% 70% 78% 80% 81% 20% 20% 0% 0% FY2014 FY2015
Slide 17: Roads – Highlights (Cont’d)
Infrastructure Roads – Highlights (Cont’d) Traffic Mix (Cont’d) Hangzhou Ring Road (“HZRR”) Tangjin Expressway (Tianjin North Section) (“TJE”) 100% 100% 20% 23% 24% 25% 22% 58% 52% 50% 46% 51% 80% 80% 60% 60% 40% 40% 80% 77% 76% 75% 78% 42% 48% 50% 54% 49% 20% 20% 0% 0% FY2014 FY2015 FY2016 FY2017 F
Slide 18: Roads – Highlights (Cont’d)
Infrastructure Roads – Highlights (Cont’d) 5-Year Summary (Mainland China Road Projects) Average Daily Traffic Flow* Average Daily Toll Revenue* Vehicles ‘000 RMB ‘000 1,197 21,000 1,200 19,901 1,081 18,415 18,000 1,000 973 17,042 CAGR: CAGR: 858 11% 15,205 9% 800 15,000 783 14,206 600 12,000 FY2014
Slide 19: Infrastructure Environment – Overview
8% Infrastructure FY2017 AOP Environment – Overview 9% FY2018 AOP • SUEZ NWS • Chongqing Derun Environment (“Derun”) 19
Slide 20: Environment – Highlights
Infrastructure Environment – Highlights SUEZ NWS • Water sales and wastewater treatment volume up 9% with full year contribution from Pillar Point Sewage Treatment Plant • Waste treatment volume up 8% Derun • New waste-to-energy plant in Chongqing commenced operation in Jan 2018 (1,000 tonnes/da
Slide 21: Environment – SUEZ NWS (NWS: 42%)
Infrastructure Environment – SUEZ NWS (NWS: 42%) No. of Projects (as at 30 Jun 18) Daily Capacity Water & wastewater 35 9.1M m3 treatment Water Sludge treatment 4 2,140 tonnes Waste collection SUEZ NWS & treatment 11 9,250 tonnes Industrial & Recycling & municipal waste 8 2,060 tonnes Recovery incin
Slide 22: Environment – Derun (NWS: 12.55%)
Infrastructure Environment – Derun (NWS: 12.55%) Chongqing Water Group (SHA:601158) • Water and wastewater plants (4.6M m3/day) Chongqing Sanfeng Environment • Waste to energy plants (14,250 tonnes/day) 22
Slide 23: Environment – New projects awarded
Infrastructure Environment – New projects awarded SUEZ NWS Daily Capacity Total Location Project 3 Expected Completion (tonnes/m ) Investment Shaanxi 5,000 m3 RMB 80M 2019 Phase 1 – operational Hainan 12,000 m3 RMB 100M Wastewater Phase 2 – 2020 Phase 1 – operational Jiangsu 40,000 m3 RMB 84M Phase
Slide 24: Infrastructure Logistics – Overview
13% Infrastructure FY2017 AOP Logistics – Overview 13% FY2018 AOP • 1 logistics centre in Hong Kong • 3 port projects in Xiamen and Tianjin • 1 rail container terminal network across Mainland China 24
Slide 25: Logistics – Premium warehouse
Infrastructure Logistics – Premium warehouse FY2018 Average Rental 4% ATL Logistics Centre 6M Leasable Area (sq. ft.) 56% Attributable Interest 97.2% FY2018 Average Occupancy 25
Slide 26: Logistics – Ports
Infrastructure FY2018 Throughput Logistics – Ports 3% Xiamen Container Tianjin Five Tianjin Orient Terminal Group Continents Container Attributable interest (%) 20 18 24.5 FY2018 Throughput (TEUs) 8.2M 2.7M 1.1M JV expiry 2063 2035 2027 26
Slide 27: Logistics – Rail Logistics
Infrastructure Logistics – Rail Logistics FY2018 Throughput China United Int’l Rail Containers (“CUIRC”) (NWS: 30%) 2.7M 8% Stable growth momentum • CRC support policy • Belt and Road Initiative Terminals in operation Terminal in the pipeline 27
Slide 28: Infrastructure Aviation – Overview
13% Infrastructure FY2017 AOP 13% Aviation – Overview FY2018 AOP • Goshawk Aviation (“Goshawk”) Major acquisition Direct order book 28
Slide 29: Aviation – Aircraft Leasing
Infrastructure Aviation – Aircraft Leasing Aircraft Leasing Portfolio • Fleet size of 111 (Asset Value US$4.7B) • Young fleet (average 3.5 years) • Long operating leases (average 7.4 years remaining) (no. of aircraft) 120 111 90 90 68 60 27 30 0 2/2015 6/2016 6/2017 6/2018 29
Slide 30: Aviation – Aircraft Leasing (Cont’d)
Infrastructure Aviation – Aircraft Leasing (Cont’d) Active Portfolio Management Others 4% Others North 10% America 16% Asia and B737 A320 Middle-East Europe 37% 53% 58% 22% Aircraft Type Geographical Spread Feb 2015 Jun 2016 Jun 2017 Jun 2018 No. of aircraft 27 68 90 111 No. of lessees 15 30 38 46
Slide 31: Aviation – Goshawk (NWS: 50%)
Infrastructure Aviation – Goshawk (NWS: 50%) Acquisition of Sky Aviation Leasing Int’l Limited (“SALI”) • Fleet size: 51 aircraft* • Value: approx. US$3B • Completion: Sep 2018 *Owned and committed as at 30 Jun 2018 31
Slide 32: Aviation – Goshawk (Cont’d)
Infrastructure Aviation – Goshawk (Cont’d) Direct orders • 20 Boeing 737MAX • 20 Airbus A320neo • Delivery: Between 2023 - 2025 32
Slide 33: Aviation – Goshawk (Cont’d)
Infrastructure Aviation – Goshawk (Cont’d) Top 10 Global Lessors by Current Market Value post SALI Acquisition 29.6 (US$’B) 23.4 17.4 15.3 14.4 13.3 13.3 12.2 9.9 9.1 AERCAP GECAS AVOLON BBAM SMBC ICBC BOC AIR LEASE DAE GOSHAWK LEASING AVIATION CORP + SALI Fleet size 1,535 1,775 954 403 629 553 498
Slide 34: Services Division
Services Division 2018 2017 Change For the year ended 30 June (HK$'M) (HK$'M) (%) Facilities Management (73.1) 301.1 124 Construction & Transport 1,212.9 1,131.8 7 Strategic Investments 301.1 284.5 6 Total 1,440.9 1,717.4 16 34
Slide 35: Services Facilities Management – Overview
6% FY2017 AOP Services Facilities Management – -1% Overview FY2018 AOP • Hong Kong Convention and Exhibition Centre (“HKCEC”) • Free Duty business • Gleneagles Hong Kong Hospital (“GHK Hospital”) 35
Slide 36: Facilities Management
Services Facilities Management HKCEC Free Duty • Steady revenue growth from • Performance improved in 2HFY2018 exhibition related business and food and beverages • Traveller volume at land border crossing terminals down 2% • Over 1,000 events were held with total patronage approx. 8M • Fully renovat
Slide 37: Facilities Management – GHK Hospital
Services Facilities Management GHK Hospital (NWS: 40%) Full clinical services available Performance in line with expectation with continuous patronage growth • Insurance companies • Visiting doctors (800+) 37
Slide 38: Services Construction & Transport – Overview
23% Services FY2017 AOP 23% Construction & Transport – Overview FY2018 AOP • Top tier construction companies • Leading bus and ferry operators 38
Slide 39: Construction & Transport
Services Construction & Transport Construction Hip Hing Construction • Gross contract-on-hand: HK$47.1B • Remaining value: HK$21.2B Disposal of Hip Seng Group • Completion on 21 Aug 2018 • Reclassified as held for sale asset 39
Slide 40: Construction & Transport (Cont’d)
Services Construction & Transport (Cont’d) Transport NWS Transport Services Limited (“NWST”) • Bus company profit down 63% (HK$340M to HK$127M) • 12% fare hike pending approval 40
Slide 41: Outlook
Outlook Growth Drivers Infrastructure • Roads – traffic growth; potential acquisitions • Environment – strong project pipeline • Aviation – SALI acquisition Services • Construction – buoyant construction market; tender for major contracts 41
Slide 42: Stable Earnings Growth
Stable Earnings Growth Attributable Operating Profit and Profit After Tax HK$’B CAGR 10% AOP PAT 6 CAGR 7% 4 2 0 42
Slide 43: Disclaimer
Disclaimer NWS Holdings Limited (“NWS Holdings”) makes no representation or warranty of any kind, express, implied or statutory regarding the accuracy or completeness of the information contained. The information in this presentation is prepared solely for information purposes only. Users and reader
Slide 44: Q&A
Q&A 44