Fse Lifestyle Services Limited · HKEX:331

Fse Lifestyle Services — 1H FY2024 Earnings Presentation

36 slides from Fse Lifestyle Services's earnings presentation, February 2024

  1. Slide 1: FY2024 Interim Results Analyst Presentation

    FY2024 INTERIM RESULTS 6 Months to 31 December 2023 ANALYST PRESENTATION Feb 2024 FSE Lifestyle Services Limited |1

  2. Slide 2: Business Segments

    Business Segments FSE Lifestyle Services Limited (Stock code: 331) 100% 100% 100% Property & Facility City Essential E&M Management Services Services Services (Cleaning (Technical Support (Property & Facility & Pest & Maintenance) (E&M Engineering Control) Services) Management Services, and Sales &

  3. Slide 3: Established Market Position

    Established Market Position 1 2 Property & Facility Management (Note 1) Urban Kiu Lok IPM Urban Kiu Lok IPM (Residential; Carpark) (Non-Residential) City Essential Nova Waihong (Local Insurance Broker) (Environmental Hygiene) General Security (Security Guarding) E&M FSE Eng/Majestic/Young’s/Far East

  4. Slide 4: Market Positioning

    Market Positioning Industry Market Share (%) Property & Facility Residential 5.8% Management (Note 1) Urban Kiu Lok Non-Residential 6.1% IPM Carpark 7.8% City Essential Environmental Hygiene 9.9% Waihong Security Guarding 2.3% General Security General Business Line 2.0% Nova E&M E&M Engineering 6.6%

  5. Slide 5: Reported Earnings

    Reported Earnings $280M $255M 9% 1H 2023 1H 2024 Interim dividend per share $0.224 and a dividend payout ratio 40% FSE Lifestyle Services Limited | 5

  6. Slide 6: Core Earnings

    Core Earnings $235M $231M Stable 1H 2023 1H 2024 Excluding government grants $45M Excluding government grants $24M FSE Lifestyle Services Limited | 6

  7. Slide 7: Core Earnings (Excluding ad hoc works)

    Core Earnings (Excluding ad hoc works) $208M $231M 12% 1H 2023 1H 2024 Excluding government grants $45M Excluding government grants $24M and one-off ad hoc works $27M FSE Lifestyle Services Limited | 7

  8. Slide 8: Group turnover

    Group turnover $3,712M $4,115M 11% 1H 2023 1H 2024 FSE Lifestyle Services Limited | 8

  9. Slide 9: 20% CAGR EPS FY2017-23 (Reported)

    20% CAGR EPS FY2017-23 (Reported) ($) 1.29 1.20 1.14 1.10 0.17 0.20 0.80 0.76 0.68 0.46 0.43 0.11 0.56 0.53 0.55 0.05 0.13 0.16 0.17 0.40 0.39 0.30 0.18 0.21 0.21 0.18 0.47 0.51 0.51 0.25 0.23 0.18 0.19 0.18 0.00 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 1H 2024 Acquisition Acquisition Acquis

  10. Slide 10: Steady Returns to Shareholders

    Steady Returns to Shareholders Total dividend per share since IPO $2.584, representing 94% of IPO price 8.8 8.3 7.9 7.4 ($) 0.5 0.450 0.450 0.458 0.4 0.161 0.213 0.241 0.3 0.272 0.224 0.2 0.144 0.289 0.245 0.224 0.1 0.209 0.128 0 6/20 6/21 6/22 6/23 12/23 Interim Dividend Final Dividend Dividend yie

  11. Slide 11: FSE Lifestyle outperformed HSI and HSPSMI

    FSE Lifestyle outperformed HSI (Hang Seng Index) and HSPSMI (Hang Seng Property Service and Management Index) 21,860 19,781 18,916 4,600 17,047 16,635 24% 14,687 (恒生指數) 3,296 2,444 1,777 1,846 1,762 62% $6.03 (恒生物業服務及管理指數) $5.68 $5.77 $5.44 $5.15 $4.51 12% (豐盛生活服務) 30 Jun 22 31 Oct 22 31 Dec 22 30 J

  12. Slide 12: 13% CAGR Turnover FY2017-23 (Reported)

    13% CAGR Turnover FY2017-23 (Reported) ($’M) 8,000 7,767 6,967 7,000 6,453 6,000 774 4,055 4,927 4,931 4,882 3,616 5,000 568 1,171 2,920 4,115 4,000 3,700 2,639 2,172 3,000 1,931 1,993 2,000 4,115 3,712 3,351 2,759 1,000 2,292 2,142 1,769 1,763 0 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 1H 2

  13. Slide 13: 20% CAGR Profit FY2017-23 (Reported)

    20% CAGR Profit FY2017-23 (Reported) ($’M) 600 587 523 503 500 77 88 340 400 212 310 200 300 48 248 255 237 24 73 200 57 78 174 134 86 93 82 92 215 234 231 100 114 103 82 87 87 0 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 1H 2024 Acquisition of Acquisition of Acquisition of Waihong & NCL Urban

  14. Slide 14: Segment AOP – 1H 2024

    Segment AOP* – 1H 2024 Non-E&M Recurring Businesses remain solid, contribute 63% AOP and growing $101M $66M Property & Facility Management City Essential 25% 38% E&M 37% $100M * Based on Net Profit including government grants but excluding unallocated corporate expenses FSE Lifestyle Services Limite

  15. Slide 15: Over 300 property and facility management contracts

    Property & Facility Management Urban/IPM/Kiu Lok Over 300 property and facility management contracts Over 300 property and facility management contracts Government Property One Beacon Hill K11 Masterpiece Neich Tower Agency FSE Lifestyle Services Limited | 15

  16. Slide 16: Property & Facility Management

    Property & Facility Management Urban/IPM/Kiu Lok Turnover *Profit ($M) ($M) 450 80 70 350 60 50 250 40 69 357 66 330 30 150 20 50 10 1H 2023 1H 2024 1H 2023 1H 2024 * including government grants FSE Lifestyle Services Limited | 16

  17. Slide 17: Over 310 cleaning service contracts

    City Essential Services (i) Cleaning & Pest Control - Waihong Over 310 cleaning service contracts The Peninsula Hong Kong Hong Kong Airport Hong Kong Children’s Hospital KAI TAK AIRSIDE FSE Lifestyle Services Limited | 17

  18. Slide 18: City Essential Services – Cleaning & Pest Control

    City Essential Services (i) Cleaning & Pest Control - Waihong Turnover (HK$’M) 1,200 1,000 800 LINK Properties 1,128 600 827 400 Leisure and Cultural Services 200 Department 1H 2023 1H 2024 Hong Kong Jockey Club Retail & Telebet Centres FSE Lifestyle Services Limited | 18

  19. Slide 19: Over 2,400 technical support and maintenance service contracts

    City Essential Services (ii) Technical Support & Maintenance - Far East/Turning Over 2,400 technical support and maintenance service contracts Lee Garden World Peace Centre HKCEC EMSD FSE Lifestyle Services Limited | 19

  20. Slide 20: City Essential Services – Technical Support & Maintenance

    City Essential Services (ii) Technical Support & Maintenance - Far East/Turning Turnover ($’M) 600 500 400 Nina Tower 300 500 461 200 100 1H 2023 1H 2024 Four Season FSE Lifestyle Services Limited | 20

  21. Slide 21: Over 550 security guarding, systems and event services contracts

    City Essential Services (iii) Security Guarding & Event Services – General Security/Perfect Event Over 550 security guarding, systems & technologies and event services contracts MTR Properties New World Properties Kai Tak Sports Park FSE Related Projects FSE Lifestyle Services Limited | 21

  22. Slide 22: City Essential Services – Security Guarding & Event Services

    City Essential Services (iii) Security Guarding & Event Services – General Security/Perfect Event HKJC Racecourses HKCEC Outdoor Events Music Concerts Hang Lung Properties Private Events FSE Lifestyle Services Limited | 22

  23. Slide 23: City Essential Services – Security Guarding & Event Services

    City Essential Services (iii) Security Guarding & Event Services – General Security/Perfect Event Turnover ($’M) 340 320 300 280 Riviera Garden 332 260 307 240 220 200 1H 2023 1H 2024 Park Villa FSE Lifestyle Services Limited | 23

  24. Slide 24: Over 3,900 insurance solutions contracts

    City Essential Services (iv) Insurance Solutions - Nova Over 3,900 insurance solutions contracts The Hong Kong Management Association Citybus Limited Macau Grand Prix FSE Lifestyle Services Limited | 24

  25. Slide 25: City Essential Services – Insurance Solutions

    City Essential Services (iv) Insurance Solutions - Nova Turnover ($’M) 70 60 Kai Tak Sports Park Project Extension 50 61 58 40 30 1H 2023 1H 2024 Public Housing Development at Wang Chau, Yuen Long FSE Lifestyle Services Limited | 25

  26. Slide 26: Over 1,000 environmental solutions contracts

    City Essential Services (v) Environmental Solutions – FSE Environmental Solutions Over 1,000 environmental solutions contracts Lyric Theatre Complex Kai Tak Sports Park EV Charger at Sea Water Diocesan Girl’s School – Water Feature System – The Paramount – Electro-chlorination System – Green Solutio

  27. Slide 27: City Essential Services – Environmental Solutions

    City Essential Services (v) Environmental Solutions – FSE Environmental Solutions Turnover ($’M) 180 160 140 120 100 Kai Tak ADCS Sea Water 168 Electro-chlorination System – 150 Environment Solutions 80 60 40 20 1H 2023 1H 2024 11 SKIES – Smart Solutions FSE Lifestyle Services Limited | 27

  28. Slide 28: City Essential Services Segment Highlight

    City Essential Services Segment Highlight Turnover *Profit ($’M) ($’M) 2,300 150 2,100 1,900 1,700 100 1,500 1,300 2,143 121 1,849 1,100 50 101 900 700 500 0 1H 2023 1H 2024 1H 2023 1H 2024 * including government grants FSE Lifestyle Services Limited | 28

  29. Slide 29: Over 100 E&M services contracts

    E&M Services FSE Engineering/Majestic/Young’s Over 100 E&M services contracts Expansion of Tin Shui Wai District Court at LegCo Complex New Public Market Caroline Hill Road Legislative Council Complex 寧波新世界廣場3期 FSE Lifestyle Services Limited | 29

  30. Slide 30: E&M Services Segment Highlight

    E&M Services Segment Highlight Turnover *Profit ($’M) ($’M) 1,700 110 1,500 85 1,300 1,100 60 1,642 100 1,506 97 900 35 700 500 10 1H 2023 1H 2024 1H 2023 1H 2024 * including government grants FSE Lifestyle Services Limited | 30

  31. Slide 31: Healthy Remaining Works

    Healthy Remaining Works ($M) 14,000 13,016 13,052 Stable ↓9% 12,000 10,000 5,857 5,542 ↓5% 8,000 6,000 ↑7% 4,000 6,196 6,638 2,000 ↓9% 963 872 - Jun2023 Jun 2023 Dec 2023 Dec 2023 Property & facility management City Essential E&M FSE Lifestyle Services Limited | 31

  32. Slide 32: Strong Capital Structure

    Strong Capital Structure - With financial flexibility and funding certainty As at 31 December 2023 Banking Facilities Cash and Banks Debt Maturity Profile $1,040M $467M, 91% (in HK$M) Jan 24 53 Total Total Jan 24 5 $2,909M $513M Dec 24 219 $26M, 5% $20M, 4% Zero net gearing ratio $1,869M Unutilised

  33. Slide 33: FSE Ecosystem (Multi Service Lines)

    FSE Ecosystem (Multi Service Lines) - With strong cross-selling to drive growth Strong Cross- selling Synergies Organic Growth through FSE ECOSYSTEM Diversified High Income Quality Streams FSE Lifestyle Services Limited | 33

  34. Slide 34: Why Invest In FSE Lifestyle?

    Why Invest In FSE Lifestyle? - Continuous return to shareholders with quality development Defensive and Resilient Financial Results and Contract Portfolio - Sustained core earnings $231m - New contract award $3.3b - Strong order book $24b - Healthy remaining works $13b High Dividend Yield, Consisten

  35. Slide 35: Why Invest In FSE Lifestyle?

    Why Invest In FSE Lifestyle? - Continuous return to shareholders with quality development Strong Governance & Capital Management - High caliber management team - Effective ESG stewardship - Zero net gearing - Ample facilities and liquidity, low funding costs Continuous M&A - Proposed acquisition of

  36. Slide 36: Q&A

    Q&A FSE Lifestyle Services Limited | 36

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