Hung Hing Printing Group Limited · HKEX:450
Hung Hing Printing — Investor Presentation (July 2010)
32 slides from Hung Hing Printing's investor presentation, July 2010
Slide 1: July 2010 Corporate Presentation
July 2010 Corporate Presentation
Slide 2: Disclaimer
Disclaimer The presentation is prepared by Hung Hing Printing Group Limited (the “Company”) and is solely for the purpose of corporate communication and general reference only. The presentation is not intended as an offer to sell, or to solicit an offer to buy or to form any basis of investment deci
Slide 3: The Leading Printer in Asia
The Leading Printer in Asia … … in book and package printing One of the world’s largest manufacturer of children’s books and novelty items 4 manufacturing sites in mainland China and 1 plant in Hong Kong. Leading printer in China with the largest capacity and most diverse capability. Blue chip clien
Slide 4: Hung Hing Core Values
Hung Hing Core Values We strive to be the best in all we do. To our customers, we provide high quality and innovative printing solutions. focus on value-added services. offer the best value for money. value long term business relationship and the opportunity to serve and grow with them. 4
Slide 5: A Well-Balanced Portfolio
A Well-Balanced Portfolio Revenue by business unit The export focused Book and Fiscal Year Ended March 31, 2010 Package Printing is expected to resume growth in FY10/11 upon the recovery of the world economy Paper Trading 14% Strategically located in Zhongshan and Wuxi, the Consumer Product Corrugat
Slide 6: Our Competitive Advantages
Our Competitive Advantages Established market leadership Long proven history of success International sales network Sustained growth for over 6 Blue chip clients around the decades globe One of the most trusted printers Significant market share in all in Asia segments that we operate Professional Ma
Slide 7: Our Core Businesses
Our Core Businesses Book & Package Corrugated Box Printing Consumer Product Packaging Paper Trading
Slide 8: Book & Package Printing, A Global Business
Book & Package Printing, A Global Business Three plants located in Shenzhen, Heshan and Hong Kong. Serving global customers and manufacturers located in Hong Kong and Pearl River Delta (PRD) Our customers include international publishers (e.g., D.K., Five Mile, Hinkler..) and branded customers (e.g.
Slide 9: Book and Package Printing – Revenue & Operating Profit
Book and Package Printing – Soft customer demand around the globe impacts revenue Book and Package Printing – Revenue & Operating Profit % 1,600 18% 16% 1,448 1,376 16% Revenue ↓19% to 1,400 1,237 1,263 HK$1,178 million 1,178 14% Revenue (HK$ million) 1,200 Operating Profit (%) 12% Operating profit↑
Slide 10: Consumer Product Packaging, Capturing growth in the China domestic market
Consumer Product Packaging, Capturing growth in the China domestic market Provide high-quality packaging solutions for customers through Zhongshan and Wuxi plants Strong clientele in the personal care, packaged food and consumer electronics sectors, including Colgate, Mead Johnson, Want Want, Haitia
Slide 11: Consumer Product Packaging – Revenue & Operating Profit
Consumer Product Packaging – intensified competition and lower selling price reduced revenue Consumer Product Packaging – Revenue & Operating Profit % 800 752 10% 9% Revenue ↓17% to 700 8% 636 9% 621 8% HK$621 million Revenue (HK$ million) 600 8% Operating Profit (%) 525 7% 500 491 6% Operating inco
Slide 12: Corrugated Box, good synergy with Package Printing
Corrugated Box, good synergy with Package Printing Leading corrugated box supplier in the PRD. Our customers include Lenovo, Brother, Garden, LKK …. Derive two-thirds of sales from HK-based exporters and one-third from customers in China Manufacturing facility in Shenzhen and distribution center in
Slide 13: Corrugated Box – Revenue & Operating Profit
Corrugated Box – Reduced level of manufacturing activities in the PRC impacted revenue Corrugated Box – Revenue & Operating Profit % 600 20% 18% 18% External revenue ↓ 500 25% to HK$256 16% million Revenue (HK$ million) 14% Operating Profit (%) 400 111 140 104 108 12% Operating income ↓ 10% 12% 300
Slide 14: Paper Trading, Buffers paper trend impact
Paper Trading, Buffers paper trend impact Well-managed warehouse facility in Shenzhen with a storage capacity of over 60,000 tons of paper Customer base includes leading printers and manufacturers in China An integral part of the Group’s supply chain, providing good visibility of paper price and sta
Slide 15: Paper Trading – Revenue & Operating Profit
Paper Trading – Effective buying & sales strategy boosts sales during a period of uncertainty Paper Trading – Revenue & Operating Profit % 900 10% 9% 800 9% External revenue ↑ 8% 3% to HK$343 million 700 8% Revenue (HK$ million) 362 7% Operating Profit (%) 600 6% 6% Operating income ↓ 397 6% 17% to
Slide 16: Revenue Impacted Across our Different BUs
Revenue Impacted Across our Different BUs 3,500 3,000 2,828 2,874 332 2,500 2,319 2,392 464 2,398 342 281 (HK$ million) 270 352 343 2,000 323 256 321 752 636 1,500 491 525 621 1,000 1,263 1,376 1,448 1,237 1,178 500 0 FY05/06 FY06/07 FY07/08 FY08/09 FY09/10 Book and Package Printing Consumer Product
Slide 17: Q4 Revenue Reflects a Rebound
Q4 Revenue Reflects a Rebound FY09/10 Revenue ↓17% vs the previous year Q4 FY09/10 shows a clear rebound, ↑23% vs Q4 FY08/09. The growth momentum continues this year…. Quarterly Revenue 1,200 982 1,000 804 738 (HK$ million) 800 647 583 544 600 533 441 400 200 0 Q1 Q2 Q3 Q4 FY09/10 FY08/09 17
Slide 18: Operating Profit By Business Unit
Operating Profit By Business Unit 350 300 27 55 250 42 36 62 (HK$ million) 41 46 45 200 88 25 55 34 150 39 50 68 100 198 164 50 100 119 90 0 FY05/06 FY06/07 FY07/08 FY08/09 FY09/10 Book and Package Printing Consumer Product Packaging Corrugated Box Paper Trading 18
Slide 19: Financial Review
EXCELLENCE Financial Review HUNG HING
Slide 20: Profit Attributable To Equity Holders & Earnings Per Share
Profit Attributable To Equity Holders & Earnings Per Share Profit attributable to equity holders Basic Earnings per share was was HK$167 million HK18.2 cents 300 277 50 46.1 249 42.5 250 40 200 167 30 (HK$ million ) (HK Cents) 150 20 18.2 100 10 50 2 0.2 0 0 (3.0) (18) (50) (10) FY05/06 FY06/07 FY07
Slide 21: Financial Highlights – Core & De-consolidated Operations
Financial Highlights – Core & De-consolidated Operations (HK$ Million) FY09/10 FY08/09 Changes Revenue 2,398 2,874 -17% Profit for the year Continuing operations 166 305 Discontinued operations 19 -470 185 -165 Profit attributable to equity holders of the 167 2 parent Basic earnings per share (HK ce
Slide 22: Financial Highlights – De-consolidated Operation (Paper Manufacturing)
Financial Highlights – De-consolidated Operation (Paper Manufacturing) (HK$ Million) FY09/10 FY08/09 Profit/(Loss) for the year 19 -470 After crediting/(charging): - Impairment provisions - -288 - Loss from fire - -30 - Fire insurance claim 18 - - Gain on disposal of Paper mill 18 - The Group’s equi
Slide 23: Financial Highlights – Core Operations
Financial Highlights – Core Operations (all except Paper Manufacturing) (HK$ Million) FY09/10 FY08/09 Changes Operating Profit Revenue 2,398 2,874 -17% declined by 27 % Gross profit 504 610 -17% Gross profit % 21% 21% Previous year profit was boosted by a Fair Operating profit 204 280 -27% Value Gai
Slide 24: Solid Cash-flow, even in the year of economic volatility
Solid Cash-flow, even in the year of economic volatility Adjusted EBITDA and CAPEX 400 368 377 359 340 350 325 300 (HK$ million) 250 201 200 146 154 150 132 100 62 50 0 FY05/06 FY06/07 FY07/08 FY08/09 FY09/10 Adjusted EBITDA CAPEX EBITDA has excluded Paper mill, fair value changes on derivatives and
Slide 25: Capex Scaled Back In Light Of Market Uncertainty
Capex Scaled Back In Light Of Market Uncertainty 250 201 200 With the economic 154 recovery, four new state- 146 (HK$ million ) 150 of-the art printing presses 132 costing HK$80 million are scheduled to arrive Q1 100 FY2010/2011 62 50 0 FY05/06 FY06/07 FY07/08 FY08/09 FY09/10 25
Slide 26: High Cash Level Supports Growth And Dividend Pay-out
High Cash Level Supports Growth And Dividend Pay-out (HK$ Million) 2010 2009 Changes Cash Cash and bank balances 620 292 Time deposits 489 1,134 1,109 1,426 -22% Bank borrowings Short-term bank loan 239 337 Long-term bank loan 186 336 425 673 -37% Cash net of debts 684 753 -9% Net cash decreased by
Slide 27: Proposed Dividends
Proposed Dividends 35 29.5 29.5 30 To celebrate our 60th 25 23.0 anniversary, the Board has proposed a special (HK Cents) 20 dividend of 9 cents, in 14.0 addition to the final 15 dividend of 10 cents, bring 10 8.5 total dividend to 23 cents for the year. 5 (Interim dividend: 4 cents) 0 FY05/06 FY06/
Slide 28: Looking Forward...
as 52 WA a3 Looking Forward...
Slide 29: Market Outlook
Market Outlook Opportunities Global market is recovering and we are seeing rising order intake China market offers strong potential Industry consolidation present good opportunity for the Group to expand market share Challenges Instability in European financial markets Appreciating Renminbi Rise of
Slide 30: 2010/11 Focus On…
2010/11 Focus On… ■ Improve materials and logistics management Operational ■ Accelerate automation to offset the rising labor costs Efficiency ■ Refine our IT strategy aiming to establish a first class Order to Shipment process across all HH sites ■ A leading player in this highly segmented market C
Slide 31: Hung Hing – The Leading Printer in Asia
Hung Hing – The Leading Printer in Asia With unrivalled market leadership, well-balanced portfolio and sustained growth for over six decades, Hung Hing is in an excellent position to take advantage of growing opportunities as the economic recovery continues to build momentum.
Slide 32: Q&A
MUNG PaNG Q&A
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