Sia Engineering Co. Ltd. · SGX:S59
Sia Engineering — H1 FY2021/22 Earnings Presentation
31 slides from Sia Engineering's earnings presentation, Nov 8, 2021
Slide 1: 1H FY21/22 Review
1H FY21/22 REVIEW 08 NOVEMBER 2021
Slide 2: Operational Review
Operational Review SIA ENGINEERING ie 1Y
Slide 3: Core Business
Core Business Line Maintenance Base Maintenance Fleet Management • 26 airports in 7 countries • 6 hangars in Singapore • 77 aircraft from 9 airlines • 3 hangars in Philippines 3
Slide 4: Line Maintenance
Line Maintenance • Number of flights handled in 1H FY21/22 increased 84% YOY; only 25% of pre-pandemic workload • Pace of recovery was slow; increase in flights were mainly from base carriers at Changi Airport • In the six months up to September 2021, flight recovery was only 4.1 percentage points F
Slide 5: Base Maintenance
Base Maintenance Maintenance Checks at Singapore Base 1H FY20/21 1H FY21/22 • Number of checks increased from active Light Checks* 109 162 marketing efforts Heavy Checks 24 46 • Many of these checks were of lighter work content Maintenance Checks at Clark Base • Travel restrictions implemented by th
Slide 6: Fleet Management
Fleet Management • Work volume, which is largely driven by flight activities, remained low due to low flight hours and retirement of customers’ older aircraft. FMP Fleet: 77 aircraft Customers A320 A320 47 aircraft A330 (Tailored Support Package) 1 aircraft 737 22 aircraft 747 7 aircraft 6
Slide 7: 1H Customer Contracts
1H Customer Contracts Line Maintenance Line Maintenance International Base Maintenance Renewed New New New Fleet Management New 7
Slide 8: Ensuring Workplace Safety and Well-being of Staff
Ensuring Workplace Safety and Well-being of Staff • 97% of the company workforce is fully vaccinated • Staff are continually updated on safe-management measures and work-from-home arrangements • To provide a conducive and safe working environment for continuing business and operations, we strictly e
Slide 9: Strategic Partnerships – JV Portfolio
Strategic Partnerships – JV Portfolio 22 JVs Across 7 Countries (Total Revenue in 1H FY21/22: S$2.4B) Airframe and Line Maintenance Engine and Component SIA Engineering SIA Engineering PT JAS Aero-Engineering Singapore Aero Engine Eagle Services Asia (ESA) Component Aerospace (USA) (SEUS) Japan (SIA
Slide 10: Transformation Phase 2 (2021-2023) Gaining Traction
Transformation Phase 2 (2021-2023) Gaining Traction Power Up with Lean Power Up with Digital o Pervasive enterprise-wide and Technology implementation Planned o Launched new digital applications, o More than 20% improvement investments of workflow and RPA solutions in turnaround time $40M o Progress
Slide 11: Progressing in Digitalisation and Technology
Progressing in Digitalisation and Technology • Enabling pervasive digitalisation through upgrade of digital infrastructure, innovation culture and adopting agile approach to project development • Building upon Lean efforts to digitalise streamlined processes and leverage optimisation solutions • Ben
Slide 12: Power Up with Lean
Power Up with Lean • Under Transformation Phase 2, over $10M will be invested to accelerate and sustain a Lean transformation enterprise-wide • Launched Lean Academy on 7 September 2021 • Aim to have 100% of our workforce trained in Lean by early 2023 • Training to be extended to the wider aerospace
Slide 13: Engineering a Sustainable Future
Engineering a Sustainable Future Responsible business practices to drive positive change in the community Reducing Emissions Green Building Reduction in scope 1 and 2 emissions intensity (against revenue) Hangar 3 25% Certified PUB Water Efficient Building (WEB) Compared to base year FY13/14 A
Slide 14: Financial Review
Financial Review » SIA ENGINEERING CcOmPANY
Slide 15: 1H21/22 Financial Highlights
1H21/22 Financial Highlights • Smaller operating loss year-on-year as revenue increased with recovery in flight activities, albeit recovery of flight activities had been low. • Group operating loss of $6.7 million as compared to loss of $27.2 million for 1H20/21. • Share of profits of associated and
Slide 16: Summary of Group Results 1H21/22
Summary of Group Results 1H21/22 Group 1Q 2Q 1H21/22 1H20/21 Variance $M $M $M $M $M % Revenue 125.3 138.2 263.5 223.0 +40.5 +18.2 Expenditure 128.2 142.0 270.2 250.2 +20.0 +8.0 Operating loss (2.9) (3.8) (6.7) (27.2) +20.5 +75.4 Share of profits of JV & Assoc 14.8 12.0 26.8 28.4 -1.6 -5.6 Other non
Slide 17: Analysis of Group Profit – 1H21/22
Analysis of Group Profit – 1H21/22 S$M 40.0 +35.0 +3.2 -31.2 +4.9 30.0 Share of -5.2 25.0* +28.3 profits Non-operating Exchange items & NCI -5.6 20.0 differences Taxation 10.0 44.0M 1H20/21 0.0 Excluding impact of JSS and +14.6 JSS Impairment on 1H21/22 BMD impairment, Group ($64.5M vs Base perform
Slide 18: Breakdown of Group Revenue 1H21/22
Breakdown of Group Revenue 1H21/22 Group Revenue increased $40.5M year- on-year (+18.2%) to $263.5M Group Revenue ($M) 1Q 2Q Fleet management Airframe overhaul and line programme maintenance 107.6 117.0 $24.6M, 9% Fleet management programme 10.8 13.8 (-$5.5M YoY) Airframe and line maintenance 118.4
Slide 19: Group Revenue Trend
Group Revenue Trend Group Revenue $'M 512.7 481.4 +18.2% YoY 263.5 51% of 1H19/20 223.0 220.0 1H19/20 2H19/20 1H20/21 2H20/21 1H21/22 Gradual improvement from with slow flight recovery. 19
Slide 20: Group Expenditure 1H21/22
Group Expenditure 1H21/22 Group Expenditure increased $20.1M year-on-year (+8.0%) to $270.2M Depreciation and amortisation Others $31.9M $47.3M Group Expenditure ($M) 1Q 2Q 12% 18% (-$6.1M YoY) (-$5.3M YoY) Staff costs 57.0 70.2 Material costs 18.5 20.2 Subcontract costs 11.8 13.3 Subcontract costs
Slide 21: Group Expenditure Trend
Group Expenditure Trend Group Expenditure $'M 475.4 451.0 270.2 +8.0% YoY 250.2 57% of 1H19/20 217.8 1H19/20 2H19/20 1H20/21 2H20/21 1H21/22 Increase in expenditure due to progressive step-down in JSS support and rollback of manpower measures. 21
Slide 22: Group Operating Profit 1H21/22
Group Operating Profit 1H21/22 Group Operating Loss 1Q 2Q 1H21/22 1H20/21 Variance $M $M $M $M $M % Airframe and Line Maintenance (0.9) (0.9) (1.8) (25.1) +23.3 +92.8 Engine and Component (2.0) (2.9) (4.9) (2.1) -2.8 -133.3 (2.9) (3.8) (6.7) (27.2) +20.5 +75.4 22
Slide 23: Joint Venture and Associated Companies 1H21/22
Joint Venture and Associated Companies 1H21/22 Share of Profit/(Loss) After Tax 1Q 2Q 1H21/22 1H20/21 Variance $M $M $M $M $M % Engine centers 11.3 6.0 17.3 22.4 -5.1 -22.8 Component centers 7.0 8.1 15.0 15.5 -0.5 -3.2 Engine and component 18.3 14.1 32.3 37.9 -5.6 -14.8 Airframe and line maintenance
Slide 24: Aggregated Revenue of the Group 1H21/22
Aggregated Revenue of the Group 1H21/22 (Company, Subsidiaries, JV and Associated Companies) Aggregated Revenue of Company, Subsidiaries, JV and Associated Companies $'M 3,250.4 3,091.9 547.1 561.1 2,633.3 +20.0% YoY 85% of 1H19/20 282.7 2,194.5 2,092.9 241.3 274.9 2,530.8 2,703.3 1,953.2 1,818.
Slide 25: Group Balance Sheet
Group Balance Sheet Sep-21 Mar-21 Variance $M $M $M % Total equity 1,578.3 1,544.2 +34.1 +2.2 Non-current liabilities 70.1 56.5 +13.6 +24.1 Current liabilities 194.3 209.1 -14.8 -7.1 Non-current assets 908.2 883.8 +24.4 +2.8 Cash 685.7 616.0 +69.7 +11.3 Other current assets 248.8 310.0 -61.2 - 9.7 •
Slide 26: Financial Statistics
Financial Statistics 1H21/22 1H20/21 Variance Financial Statistics Return on shareholders' funds (%) 2.1 5.7 -3.6 ppt Basic earnings/(loss) per share (cents) 2.23 (1.69) n.m. Sep-21 Mar-21 Variance Net asset value per share (cents) 139.7 136.8 +2.1 % 26
Slide 27: Powering Up for Growth
Powering Up for Growth SIA ENGINEERING ie 1Y
Slide 28: Summary of 1H FY21/22
Summary of 1H FY21/22 ~27% Prudent Cost Absence of Transformation Improvement in Management Impairment Efforts Gained Operating Profit Traction through cost-saving improved net profit after comparing 1H year-on- measures, and with tax with Lean and Digital year, excluding JSS support from projects i
Slide 29: Outlook
Outlook Challenges Remain Pace of recovery remains uncertain amidst surge in COVID-19 positive cases and new variant concerns Government Wage Support tapering off Rising operating cost from rollback of manpower management measures and preparation for further recovery 29
Slide 30: Positioning for Recovery and Future Growth
Positioning for Recovery and Future Growth Remain vigilant and disciplined in the management of costs Accelerate Transformation - invest in digitalisation, automation and adoption of Lean frameworks to raise productivity Reshape our portfolio and invest in new capabilities and services Pursue new op
Slide 31: Thank you
Thank you 31
SIA Engineering Company — H1 FY2021/22 Earnings Presentation on 6ix