Yip's Chemical Holdings Limited · HKEX:408
Yip's Chemical — FY2007/08 Earnings Presentation
31 slides from Yip's Chemical's earnings presentation, 2008
Slide 1: Annual Results Announcement 2007-2008
2007--2008 2007 Annual Results Announcement Presenters: Mr. Tony Chi Shing Ip (Chairman) Mr. Kenny Kam Yim Wong (CEO) M Robe Mr. Robertt Man Kim Young Yo ng (Di (Director) ecto ) Mr. George Siu Ping Ng (CFO) 1
Slide 2: Disclaimer
Disclaimer The information on these slides does not constitute a recommendation by financial adviser or selling agent that any recipient should invest in the Company. R i i t should Recipients h ld make k th i own independent their i d d t appraisal, evaluation, assessment and investigation as deeme
Slide 3: Programme
Programme g Chairman’s Chairman s Remarks Financial Highlights Core Businesses Analyses Corporate Development Consolidated Financial Statements 3
Slide 4: Chairman's Remarks: Overview
Chairman’s Remarks： Remarks：Overview Results reached record highs Satisfactory results attained: strong growth in sales, net profits, and dividends, with improvement in gearing ratio Challenging operating environment Crude oil prices again reached new heights heights, resulting in escalating costs C
Slide 5: Chairman's Remarks: New Management Structure
Chairman’s Remarks： Remarks： New Management Structure Implementation of new management structure as from 1 April 20082008, with clear segregation of responsibilities between the Board and the Management Board responsible for policy, direction, and supervision and monitoring, while Management respons
Slide 6: Chairman's Remarks: New Management Structure
Chairman’s Remarks： Remarks： New Management Structure Board Function: Board B dEExecutive ti Set long-term long term strategic plans, plans monitor MC’s operations Committee Management Function: Committee Execute policies from the Board, supervise and manage subsidiaries Group’s Operational Group’s
Slide 7: Financial Highlights
Financial Highlights g g Year ended 31 March (HK$’000) 2008 2007 % change Turnover 4 648 386 4,648,386 3 913 835 3,913,835 +19% Gross Profit 860,192 792,598 +9% Profit Margin 19% 20% - Net Profit Attributable to equity holders 275,183 , 223,636 , +23% Earnings Per Share 56.7 HK cents 46.6 HK cents +
Slide 8: Core Business Analyses
Core Business Analyses y S l Solvents t C ti Coatings L b i Lubricants t 8
Slide 9: Core Business Analyses: Turnover Distribution
Core Business Analyses: y Turnover Distribution Turnover (HK$ ’000) % Breakdown Products Year ended 31 March Year ended 31 March 2008 2007 % change 2008 2007 Solvents* 2 745 605 2,745,605 2 241 251 2,241,251 +23% 59% 57% Coatings 1,666,336 1,442,874 +15% 36% 37% Lubricants* 248,656 , 205,524 , +21%
Slide 10: Core Business Analyses: Overview
Core Business Analyses: y Overview Solvents results satisfactory satisfactory, turnover grew by 23% Coatings performance exceeded expectations; turnover and operating profit went up 15% and 40% respectively Lubricants business restructuring yielded encouraging results; despite extremely formidable o
Slide 11: Core Business Analyses: Segmental Results
Core Business Analyses: y Segmental Results 2007 2008 HK$ ’000 280,000 252,324 250,185 240,000 200,000 160,000 124,046 120,000 88,501 80,000 40,000 9 493 9,493 0 -6,384 -40,000 Solvents * Coatings Lubricants* * Minority interests in Solvents and Lubricants businesses 11
Slide 12: Core Business Analyses: Solvents
Core Business Analyses: y Solvents Sales for raw solvents excellent with full capacity utilization utilization. Mixed solvents business also enjoyed good results, led by the good performance of coatings business, Operating profit was HK$250,185,000, a slight decline of HK$2.14 million compared to th
Slide 13: Core Business Analyses: Coatings
Core Business Analyses: y Coatings Efforts in marketing and brand management generated encouraging results for coatings, with margin increases despite raw material price rises A professional marketing team has been set up within coatings to promote brands, with an aim to enhance brand position, incr
Slide 14: Corporate Development: Solvents
Corporate p Development: p Solvents Organic Growth + Active M&A Projects Shengda Chemical (Huiyang, Guandong) acquired in August 2007 for RMB55,568,000, thereby immediately raising raw solvents capacity by 45 000MT which 45,000MT, hi h increased i d the th business’ b i ’ market k t share h and d lo
Slide 15: Core Business Analyses: Lubricants
Core Business Analyses: y Lubricants Operating environment still formidable, formidable with incessant rises in price of lubricant’s main raw material – base oil. Competition was fierce as world majors compete with Sinopec and Petrochina Successful turnaround after two years of business restructurin
Slide 16: Corporate Development: Paints
Corporate p Development: p Paints Organic Growth + Active M&A Projects Pak Lam Chemical (Guandong) acquired in May 2008 for RMB33,000,000, with its operations merged into Hang Cheung Petrochemical, significantly improving competitiveness titi off th the casing i coatings ti business b i Expansion pr
Slide 17: Corporate Development: Inks
Corporate p Development: p Inks Organic Growth + Active M&A Projects Fusen Ink (Cangzhou, Hebei) acquired in June 2008 for RMB23,800,000, immediately providing Group with production base in North China and increasing capacity by 6,000MT New plant construction in Tungxiang, Zhejiang; target completio
Slide 18: Corporate Development: Organic Growth + Active M&A
Corporate p Development: p Organic Growth + Active M&A 公司總部 Headquarters 廠房位置 Locations of factories 辦事處 分公司位置 Locations 銷售點、辦事處、分公司位置 銷售點 L ti off sales l outlets, representative offices, branch offices 07/08年度新收購 07/08 New acquisitions 18
Slide 19: Corporate Development: Capacity of three businesses
Corporate p Development: p Capacity of three businesses (As at end of 2008) Solvents Raw solvents : 320,000 MT Coatings Paints : 143,000 MT Inks : 41,000 MT Resins : 20,000 MT Varnishes : 25,000 MT Lubricants Automotive and Industrial lubricants : 60,000 MT 19
Slide 20: Summary
Summary y The Group continues to benefit from China’s political stability, sustained economic growth and strong domestic demand The Group will continue to pursue sustained demand. growth in its existing businesses, and will also be proactive in p p pursuing g M&A opportunities. pp 20
Slide 21: Consolidated Financial Statements
Consolidated Financial Statements Turnover Net Profit Attributable to Equity q y Holders Dividend Per Share Consolidated Balance Sheet Consolidated Cash Flow Statement Liquidity and Financial Resources 21
Slide 22: Turnover
Turnover Full Year Interim 5,000 4,648 4,500 3,914 4,000 3,330 3,500 3 000 3,000 2 678 2,678 2,350 2,500 2,062 2,000 1,799 1,761 1,356 1,500 892 1,000 500 0 2003/04 2004/05 2005/06 2006/07 2007/08 22
Slide 23: Net Profit Attributable to Equity Holders
Net Profit Attributable to Equity Holders Full Year Interim 300 275.2 250 223.6 200 168 4 168.4 155.4 150 123.2 128.4 96 2 96.2 93.9 100 76.0 60.2 50 0 2003/04 2004/05 2005/06 2006/07 2007/08 23
Slide 24: Dividend Per Share
Dividend Per Share HKD cents Full Year Interim 26 24 25 22 20 * 20 18 16 14 14 12 12 10 10 * 10 8 8 4.5 5 6 4 4 2 0 2003/04 2004/05 2005/06 2006/07 2007/08 * include special dividend of 2.0 2 0 cents 24
Slide 25: Consolidated Balance Sheet
Consolidated Balance Sheet 2008 2007 %change (HKD’000) (HKD’000) Non-current assets 902,151 663,614 +36% Current asset 2,300,926 1,599,591 +44% Current liabilities (1,424,454) (971,990) +47% Net current assets 876,472 627,601 +40% Non-current liabilities (149,658) (57,528) +160% Capital and reserves
Slide 26: Consolidated Cash Flow Statement
Consolidated Cash Flow Statement Year ended 31 March ( HK$’000) 2008 2007 Net Cash Inflow (Outflow) - Operating Activities 307 303 307,303 285 013 285,013 - Investing Activities (420,904) (90,509) - Financing Activities 193 684 193,684 (138 403) (138,403) Net increase in cash and cash equivalents 80
Slide 27: Liquidity and Financial Resources
Liquidity q y and Financial Resources 31 March 2008 10% Gearing Ratio 31 March 2007 14% 2009/10 2008/09 Estimated Capital p Firstt Half Fi H lf 120,000 120 000 154,000 154 000 Investments Second Half 120,000 60,000 (HK$’000) 240,000 214,000 Banking g Facilities Utilized 1,158,235 Utilization Reserve
Slide 28: Q&A
RRL YIP'SCHEMICAL Q&A 28
Slide 29: Appendices
RRL YIP'SCHEMICAL
Slide 30: Consolidated Turnover
Consolidated Turnover Full year First half Second half HK$ million 5,000 4,500 4,000 3,500 3 000 3,000 2,500 2,000 1,500 1,000 500 0 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 3/8 3/8 3/8 3/9 3/9 3/9 3/9 3/9 3/9 3/9 3/9 3/9 3/9 3/0 3/0 3/0 3/0 3/0 3/0 3/0 3/0 3/0 30
Slide 31: Profit Attributable to equity holders of the Company
Profit Attributable to equity holders of the Company Full y year First half Second half HK$ million 280 260 240 220 200 180 160 140 120 100 80 60 40 20 0 -20 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 3/8 3/8 3/8 3/9 3/9 3/9 3/9 3/9 3/9 3/9 3/9 3/9 3/9 3/0 3/0 3/0 3/0 3/0 3/0
Yip's Chemical Holdings — FY2007/08 Earnings Presentation on 6ix