Sunevision Holdings Ltd. · HKEX:1686
Sunevision — FY2022/23 Earnings Presentation
36 slides from Sunevision's earnings presentation, August 2023
Slide 1: FY22/23 Results Presentation
FY22/23 RESULTS PRESENTATION (HKSE: 1686) August 2023
Slide 2: Disclaimer
DISCLAIMER The information contained in these materials is intended for reference and general information purposes only. Neither the information nor any opinion contained in these materials constitutes an offer or advice, or a solicitation, recommendation or suggestion by SUNEVISION Holdings Limited
Slide 3: Agenda
AGENDA •Financial Review •Business Review •Outlook 3
Slide 4: Financial Overview
FINANCIAL OVERVIEW Evan Wong CFO, Non-property Portfolio Businesses (SHKP)
Slide 5: Another Year of Healthy Growth
ANOTHER YEAR OF HEALTHY GROWTH • Revenue increased 12% YoY to HK$2,346mn – Revenue from data centre and IT facilities increased 11% YoY to HK$2,161mn – Growth mainly driven by increased power capacity and price increment • EBITDA grew 12% YoY to HK$1,677mn, EBITDA margin held steady at 71% • Net pro
Slide 6: Stable Revenue Growth Driven by Demand from Customers
STABLE REVENUE GROWTH DRIVEN BY DEMAND FROM CUSTOMERS Continued revenue growth on the back of capacity expansion, launch of new data centres and price increments Net Revenue¹ (HK$mn) Total IT Capacity²: ~87MW IT Occupancy³: ~73% 1,238 1,091 1,108 96 995 85 89 923 951 895 61 67 61 91 1,142 934 1,006
Slide 7: Healthy EBITDA & Net Profit Growth
HEALTHY EBITDA & NET PROFIT GROWTH EBITDA increased 12% YoY to HK$1,677mn and NPAT increased 7% YoY to HK$905mn. EBITDA margins remained strong at 71% with NPAT margin decreasing due to higher interest costs EBITDA and EBITDA Margin 2,300 NPAT1 80% (HK$mn) (HK$mn) 72% 72% 71% 1,500 60% 69% 41% 70% 1
Slide 8: Gearing and Financial Position
GEARING AND FINANCIAL POSITION Net debt / EBITDA increased to 5.7x predominantly due to funding of MEGA IDC; effective interest rate trending higher on the back of higher HIBOR. Major shareholder remains supportive Total Debt Loan Maturity and Debt Structure (HK$mn) (HK$mn) Total debt: HK$13.6bn 3,8
Slide 9: Capex to Support Expansion of Data Centre Portfolio
CAPEX TO SUPPORT EXPANSION OF DATA CENTRE PORTFOLIO SUNeVISION has embarked on a growth phase and has been investing capital to build out MEGA Gateway, MEGA IDC and other projects to expand capacity Net cash used in Investing Activities 150 1H (HK$mn) 2H (HK$mn) GFA (k sq. ft.) IT Load Capacity in P
Slide 10: Dividend Per Share
DIVIDEND PER SHARE Strong track record of delivering EPS and DPS growth. However, considering the take-up in demand and required fit-outs as well as persistent high-interest rate environment, proposed DPS of 11.2 cents (payout ratio of c.50%) Earnings per share1 & Dividend per share EPS (HK¢) 22.3 ▪
Slide 11: Business Overview
BUSINESS OVERVIEW Allen Fung Vice Chairman & Executive Director
Slide 12: Customer Demand Remains Strong
CUSTOMER DEMAND REMAINS STRONG Increase in demand of data centre space driven by expansion of hyperscalers, together with robust demand from connectivity customers. Hong Kong is the bridge connecting mainland China with the rest of the world FY23 Customer Mix Description YoY Growth Outlook • c.7% •
Slide 13: MEGA-i, Revitalisation with 40% Increase in IT Capacity
MEGA-i, REVITALISATION WITH 40% INCREASE IN IT CAPACITY MEGA-i : Most connected carrier & cloud-neutral data centre ▪ No. 1 Connectivity in Asia with ~15,000 cross-connects − Hosting ~80% City PoPs of international cables in Hong Kong − 300+ providers of telco, cloud, ISP, etc. ▪ Currently c.100% oc
Slide 14: Asia Direct Cable (ADC) Lands at HKIS-1
ASIA DIRECT CABLE (ADC) LANDS AT HKIS-1 The ADC has landed its Hong Kong segment at SUNeVision’s HKIS-1, with a new City Point-of-Presence (PoP) at MEGA Plus. Attracting additional traffic and business to the MEGA Campus and MEGA-i ▪ Hong Kong segment of ADC has landed at HKIS-1 ▪ One stop-shop solu
Slide 15: MEGA Two, Strategic Connectivity Gateway to Mainland
MEGA TWO, STRATEGIC CONNECTIVITY GATEWAY TO MAINLAND MEGA Two ▪ MEGA Two is the clear market leader in the ShaTin area with strong positioning and demand ▪ Strategic gateway to Mainland China, hosting key network hub for major national carrier and cloud / OTT players ShaTin area ▪ Strong demand but
Slide 16: SUNeVision Is Well-Positioned to Capture AI Demand
SUNEVISION IS WELL-POSITIONED TO CAPTURE AI DEMAND Rapid developments of Generative AI over the past year leading to uptake in data centre space in the US. SUNeVISION is well-positioned to capture this demand Generative AI Net Absorption (MW) of US Major DC Hubs (1Q22-1Q23)1 355.6 62.8 62.5 45.7 Nor
Slide 17: MEGA IDC Progressing Well
MEGA IDC PROGRESSING WELL MEGA IDC : Data Centre of Tomorrow ▪ Project to be built by phases ▪ Phase 1 (500,000 square feet GFA and 50MW IT load) − Undergoing OP inspection − Ready for service in Jan 2024 − Confident around demand with a number of pre-commitments secured ▪ Future phases (700,000 squ
Slide 18: Final Conclusion of Judicial Review
FINAL CONCLUSION OF JUDICIAL REVIEW A fair and healthy environment is beneficial to every participant in innovation and technology industry What’s next? HKSTP has publicly stated in July that they are taking actions to step up inspections of InnoPark tenants, ensuring their strict compliance with th
Slide 19: ESG and Sustainability Initiatives in FY23
ESG AND SUSTAINABILITY INITIATIVES IN FY23 ESG remains a key focus for SUNeVISION New Initiatives Awards & Achievements International Renewable Energy Certificates ➢ Completed the first purchase to offset all the Sustainability Strategy Green Finance carbon emissions of general building electricity
Slide 20: Outlook
OUTLOOK Allen Fung Vice Chairman & Executive Director
Slide 21: Outlook
OUTLOOK • Strong business fundamentals and growth momentum with high quality demand ahead – Have sufficient Land and capacity to cater for future demand – Well positioned to capture next wave of opportunities • Some headwinds in the operating environment: – Interest rates remain high – Operating cos
Slide 22: Q&A
Q&A
Slide 23: Thank You
THANK YOU oxahed
Slide 24: Appendix
APPENDIX
Slide 25: SUNeVision at a Glance
SUNEVISION AT A GLANCE The largest Hong Kong based data centre service provider with differentiating capabilities Largest Scalable Carrier - Neutral 7 Existing Data Centres + 1 Pipeline Project + 2 Cable Landing Stations 300+ ~29% carriers, ISPs & market share¹ Launched Upcoming Launched Upcoming ot
Slide 26: Proven Track Record of Growth Over 23 Years
PROVEN TRACK RECORD OF GROWTH OVER 23 YEARS 1 2 3 4 23 years track record of Consistently maintained Over HK$23.2b of total Strong revenue CAGR of developing data centre portfolio industry leading EBITDA margins capital invested over the years1 11% from FY2018–2023 and building strong clientele of o
Slide 27: Diverse Data Centre Portfolio Capturing Hyperscaler and Connectivity Demand
DIVERSE DATA CENTRE PORTFOLIO CATURING DEMAND FROM BOTH HYPERSCALERS AND CONNECTIVITY CUSTOMERS Hyperscale Focused Cable Landing Stations MEGA Campus MEGA MEGA MEGA MEGA HKIS-1 Two Plus Fanling IDC Location Sha Tin Tseung Kwan O Fanling Tseung Kwan O Chung Hom Kok GFA 429k sq. ft. 474k sq. ft. 129k
Slide 28: Expansion Plan Progressing as Scheduled
EXPANSION PLAN PROGRESSING AS SCHEDULED Customers of MEGA Gateway start moving in; Target opening of MEGA IDC (Phase 1) by Jan 2024 Capacity Expansion Plan (MW) Material Expansion in Design IT Power Capacity 130+ 280+ 50 20 100 10 80 70 2H2021 MEGA Fanling 2H2022 MEGA Gateway 1Q2023 NOW MEGA IDC MEG
Slide 29: Corporate Highlights
Sizable and growing addressable market 1 driven by secular tailwinds Largest IDC player with best-in-class assets 2 in strategic locations across Hong Kong Diversified, quality and sticky 3 client base CORPORATE HIGHLIGHTS 4 Strong future growth pipeline SUNEVISION is a leading data centre service p
Slide 30: Sizable and Growing Addressable Market Driven by Secular Tailwinds
1 SIZABLE AND GROWING ADDRESSABLE MARKET DRIVEN BY SECULAR TAILWINDS Unprecedented demand for data and traffic continues to drive demand for DC services. HK is a global DC hub in the fastest growing region for DC Demand for data and traffic HK public cloud market1 HK data centre market2 Cloud Softwa
Slide 31: Sizable and Growing Addressable Market: Hong Kong Connectivity Hub
1 SIZABLE AND GROWING ADDRESSABLE MARKET DRIVEN BY SECULAR TAILWINDS Hong Kong – global connectivity hub with subsea cables concentrated around the city Hong Kong as Key Hub for Data Traffic Growth Japan ✓ Geographical location, strong subsea cable China Korea Tokyo connections & well-established co
Slide 32: Reliable Power Supply and Supportive Government Policies
1 SIZABLE AND GROWING ADDRESSABLE MARKET DRIVEN BY SECULAR TAILWINDS Reliable and abundant power supply and supportive government policies further serve as HK’s competitive advantages for data centre services Reliable and Abundant Power Supply1 Supportive Government Policies2 • HK has 2 power compan
Slide 33: Largest IDC Player with Best-in-Class Assets in Strategic Locations
2 LARGEST IDC PLAYER WITH BEST-IN-CLASS ASSETS IN STRATEGIC LOCATIONS ACROSS HONG KONG Scalable data centre portfolio with strategic locations in Hong Kong SUNEVISION’s IDCs and Cable Landing Station are Developed in Strategic Strategic Focus in HK Locations in HK Scale and cluster effect Gateway to
Slide 34: Diversified, Quality and Sticky Client Base
3 DIVERSIFIED, QUALITY AND STICKY CLIENT BASE Diversified clientele with robust and accelerating demand from both hyperscale and retail customers, with top 5 customers accounted for ~49% of data centre revenue Top DC Ecosystems in HK* Clients’ Demand SUNEVISION’s Solution (% of Market Ecosystem) • D
Slide 35: Proven Dual Core Strategy for Future Growth
4 PROVEN DUAL CORE STRATEGY FOR FUTURE GROWTH Full Asset Ownership Model ✓ Provides Company with superior control in managing underlying properties – Decisions optimised based on business needs Asset Light Model – Long-term stability an important consideration MEGA-i for DC clients (Chai Wan) ✓ Limi
Slide 36: Industry Veteran Management and Strategic Shareholder Support
5 INDUSTRY VETERAN MANAGEMENT AND STRATEGIC SHAREHOLDER SUPPORT Veteran management and strong backing by strategic shareholder, enabling the fastest and most efficient high-tier data centre build in Hong Kong Industry Veteran Management Key Leadership Allen Fung Martin Chan Helen Lo Elisha Tong Alvi
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