Sats Ltd · SGX:S58
Sats — Investor Day (2024)
49 slides from Sats's investor day presentation, 2024
Slide 1: Capital Markets Day: The Flightpath to FY29
<Public> Capital Markets Day The Flightpath to FY29 <Public>
Slide 2: Forward Looking Statement – Important Note
<Public> Forward Looking Statement – Important Note This document may contain forward-looking statements. These statements are based on management’s current expectations, beliefs, and assumptions about future events, prevailing economic and market conditions and are subject to uncertainties and risk
Slide 3: Greatness doesn't exist alone
<Public> © sats Greatness doesn't exist alone. <Public>
Slide 4: Agenda
<Public> Agenda 1 The Flightpath to FY29 – Kerry Mok 2 Gateway Services & Singapore Hub – François Mirallié and Henry Low 3 Food Solutions – Stanley Goh 4 Sustainability – Véronique Cremades-Mathis 5 Financial Goals & Capital Management – Manfred Seah 6 Closing Remarks – Kerry Mok 4 <Public>
Slide 5: The Flightpath to FY29
<Public> The Flightpath to FY29 Kerry Mok, President and Group CEO <Public>
Slide 6: The leading global provider of aviation solutions
<Public> The leading global provider of aviation solutions Global Leader in Air Cargo Handling S$8bn+ Revenue Strategic Hub Handler 20%+ at Changi Airport EBITDA Margin Singapore 15%+ ROE Superior capabilities and services Asia’s Leading and sustainable operating model for Aviation Food the future C
Slide 7: Our global network today
<Public> Our global network today Stations: Middle East Greater China Thailand Cargo 125 Belgium Italy 4 16 Denmark France Netherlands Spain 1 Japan Ground 111 Germany Sweden Locations Location Locations Food 33 Ireland United Kingdom Oman Saudia Arabia 1 Europe Location 44 Locations Vietnam 1 Locat
Slide 8: Reinforcing our right to win in the marketplace
<Public> Reinforcing our right to win in the marketplace Superior Brand Unrivalled Best-in-class Strategic Market Long-standing & Service Capabilities Global Channels Global Clientele Quality Network 8 <Public>
Slide 9: 4 sustainable tailwinds lifting growth in aviation solutions
<Public> 4 sustainable tailwinds lifting growth in aviation solutions 1 Unrivalled network to leverage robust global air cargo growth Singapore hub growth as an essential connector of trade 2 flows around the world 3 Global customers need network-wide solutions 4 Strong recovery and growth in APAC p
Slide 10: Flightpath to sustainable growth and value by FY29
<Public> Flightpath to sustainable growth and value by FY29 Ground & Hub Cargo Handling Food Solutions Handling Global leader in cargo handling with a Flagship SG hub and innovation Leading provider of growing cargo platform lighthouse aviation meals in APAC & Middle East New service offerings Best-
Slide 11: SATS Gateway Services Strategic Priorities
<Public> Expand SATS cargo handling platform globally SATS Gateway Services Develop new service offerings across the network Strategic Priorities Pursue operational excellence across the network 11 <Public>
Slide 12: SATS Singapore Hub Strategic Priorities
<Public> Partner in Singapore’s ambitions as a global aviation hub SATS Singapore Hub Relentless focus on operational excellence Strategic Priorities Serve as SATS’ innovation lighthouse 12 <Public>
Slide 13: SATS Food Solutions Strategic Priorities
<Public> Be the global provider of choice in Fresh Frozen Meals (FFM) SATS Food Solutions Position SATS as APAC’s leading aviation caterer Strategic Priorities Build resilience into the business through non-aviation channels 13 <Public>
Slide 14: Globally integrated leadership
<Public> Globally integrated leadership Véronique Bob Chi François Mirallié Stanley Goh Kerry Mok Manfred Seah Cremades-Mathis Chief Strategy and CEO, Gateway Services Deputy CEO, Gateway CEO, President and Group CEO Group CFO Commercial Officer Asia Pacific Services Global Food Solutions Michael Si
Slide 15: Backed by a 49,000-strong team
<Public> Backed by a 49,000-strong team 15 <Public>
Slide 16: Gateway Services
<Public> Gateway Services François Mirallié, Deputy CEO (Gateway Services Global) Henry Low, CEO (SATS Singapore Hub) <Public>
Slide 17: Our positioning in the market: Gateway Services
<Public> Our positioning in the market Gateway Services 1 2 3 4 5 Global Flagship Hub Innovation-led Proven Track Premium Network in Singapore Capabilities Record with Service and Global Execution Customers 17 <Public>
Slide 18: Our strategic priorities in Gateway Services
<Public> 1 Reinforce and Expand the Global Network 2 Develop New Service Offerings Our strategic priorities in Gateway Services 3 Pursue Operational Excellence 4 Champion SG as Our Key Hub 18 <Public>
Slide 19: FY2029 Targets: Gateway Services
<Public> FY2029 Targets Revenue | Enhanced Scale and Margin Expansion Gateway S$4bn Services ~S$6bn v.s. FY24 EBITDA Margins Our financial targets for Gateway 18% Gateway Services Services ~22% v.s. FY24 EBIT Margin Gateway 6% Services ~10% v.s. FY24 19 <Public>
Slide 20: Strengthen existing network and expand in Americas, ME, and APAC
<Public> 1a Strengthen existing network and expand in Americas, ME, and APAC Countries where SATS is currently present White space and Canada Sweden Belgium Denmark potentially United Kingdom Germany accessible Netherlands United States France Italy Central / South Spain America Greater China Viet
Slide 21: Adapting SATS' capabilities to meet the needs of global airlines
<Public> 1b Adapting SATS’ capabilities to meet the needs of global airlines Next steps to execute global accounts strategy Enhance ways of working ✓ across global accounts by optimising the commercial’s models and resourcing Develop single view of ✓ operational SLAs & KPls to present as 'one networ
Slide 22: Gateway product innovation strategy
<Public> 2 Gateway product innovation strategy We are building an air cargo logistics ecosystem beyond standard services to meet evolving customer needs Broadening the Airlines Freight Forwarders & E-commerce Service Providers Ocean Liners customer base… Integrators (including postal) Freight Forwar
Slide 23: Case Study: New multi-modal Sea-Air solution for freight forwarders
<Public> Case Study: New multi-modal Sea-Air solution designed to streamline processes for freight forwarders Current Sea-Air Process Re-documentation at Forwarders’ site Sea shipments Collection of Sortation and pallet Delivery to Airfreight to the Lodge in at SATS arrive at Seaport shipments by bu
Slide 24: Continuous drive to achieve operational excellence
<Public> 3 Continuous drive to achieve operational excellence Operational Excellence Objectives Recent Operating Initiatives Sep 2023 Jan 2024 Develop New Solutions Experiment with POCs and emerging technologies to develop scalable new solutions Scale Continuous Improvement Optimise global processes
Slide 25: Leverage and enhance capabilities for SG Hub
<Public> 4 Leverage and enhance capabilities for SG Hub Leverage Scale & Strength Establish Changi Airport’s Champion Singapore Hub of SATS’ network and bring in global best position and volume flow as a key as SATS’ innovation lighthouse practices logistics hub Consistent Investment Collaborate in
Slide 26: Deep Dive: Developing advanced capabilities for SG Hub
<Public> Deep Dive: Developing advanced capabilities for SG Hub Key Enablers Airport Eco-system Benefits Sensing ✓ Advance staffing and equipment Drive innovation in aviation capacity planning leveraging automation and AI for Data workforce planning, tasks allocations Foundation and process optimiza
Slide 27: Food Solutions
<Public> Food Solutions Stanley Goh, CEO (Food Solutions) <Public>
Slide 28: Our positioning in the market: Food Solutions
<Public> Our positioning in the market Food Solutions 1 2 3 4 5 Singapore Highest Leading Brand Best-in-Class Asia Network Champion Quality and Equity in Asian Capabilities and Kitchen Innovation Cuisine Partnership in Capacity FFM Upside Note: FFM refers to fresh frozen meals 28 <Public>
Slide 29: Our strategic priorities in Food Solutions
<Public> Capture aviation fresh-frozen meal (“FFM”) 1 market opportunity in existing facilities Our strategic priorities in 2 Expand aviation catering presence in APAC and Middle East Food Solutions Synergistic approach to non-aviation fresh- 3 frozen meals and Singapore institutional catering for r
Slide 30: FY2029 Targets: Food Solutions
<Public> FY2029 Targets Enhanced Scale and Margin Expansion S$1.1bn Revenue ~S$2bn v.s. FY24 Our financial targets for Food Solutions EBITDA 7% Margin ~17% v.s. FY24 EBIT 3% Margin ~13% v.s. FY24 30 <Public>
Slide 31: Capture aviation FFM market opportunity
<Public> 1 Capture aviation FFM market opportunity Aviation FFM Value Proposition Deep Dive: SFST Capabilities & Service Offerings The aviation FFM market in Asia is relatively underserved and Renowned “one-stop shop” for frozen meal development for underpenetrated compared to developed aviation mar
Slide 32: Established network of kitchen facilities for fresh frozen meals
<Public> Deep Dive: Established network of kitchen facilities ready to deliver fresh frozen meals across the region SATS’ Hub-and-Spoke Kitchen Network Japan aviation catering and central Tianjin central kitchen kitchen facility ~50 tons of food produced in a day ~88k meals produced in a day ~232k s
Slide 33: Potential to expand aviation catering in APAC and Middle East
<Public> 2 Potential to expand aviation catering in APAC and Middle East SATS currently present (via subsidiary or JV) Potential for expansion Flexibility to enter China markets through Japan organic growth, India Thailand Taiwan partnerships, JVs or Philippines acquisitions, Maldives Singapore depe
Slide 34: Build resilience through non-aviation FFM business
<Public> 3 Build resilience through non-aviation FFM business Strategic Partnership Going Deeper and Wider in Institutional Catering Proven ability to leverage SATS’ culinary and operational excellence know-how Benefitting from SATS’ synergistic SATS launched a partnership with Mitsui in August
Slide 35: Sustainability
<Public> Sustainability Véronique Cremades-Mathis, Chief Strategy and Commercial Officer <Public>
Slide 36: Why ESG is paramount for SATS
<Public> Why ESG is paramount for SATS License to License to OPERATE GROW Strategic driver of long-term value creation <Public>
Slide 37: Our ESG ambitions focus on 8 priorities
<Public> Our ESG ambitions focus on 8 priorities 8 ESG priorities defined forming our license to operate and grow Environment Social Governance • Decarbonisation • Safety & Security • Cybersecurity & Data Protection • Waste & Packaging • Diversity & Inclusion • Sustainable Sourcing • Human Capital D
Slide 38: Our decarbonisation commitments
<Public> Our decarbonisation commitments 2030 Reduce our Scope 1 and 2 emissions by 50% 2040 Carbon neutral 2050 Achieve Net Zero 38 <Public>
Slide 39: Our 3-stage ESG approach
<Public> Our 3-stage ESG approach COMPLY OPTIMIZE TRANSFORM We do it right We do it better We do it differently for the best Ensure compliance with the highest environmental, Scale-up and replicate best practices to streamline Embed sustainability in all Group functions to safety, and governance sta
Slide 40: <Public> <Public>
<Public> 40 <Public>
Slide 41: Financial Goals & Capital Management
<Public> Financial Goals & Capital Management Manfred Seah, Group CFO <Public>
Slide 42: Bigger, stronger and more resilient
<Public> Bigger, stronger and more resilient FY22 FY24 1H FY25 Results Pre WFS Post WFS Revenue S$1,177M S$5,150M S$2,821M EBITDA / Margin% S$77M / 7% S$781M / 15% S$515M / 18% Others APAC 2% 13% Americas 36% 34% Singapore S$240M / 8% Balanced EBIT / Margin % Regional Mix 85% Singapore 20% 10% APAC
Slide 43: Global market-canvas to paint on after WFS integration
<Public> Global “market-canvas” to paint on after WFS integration S$5.1bn S$6.0bn 49,000+ 215 27 FY24 Revenue Current Market Capitalisation Employees Locations Countries Full post-COVID recovery in FY25 8M+ 600,000+ 34 96M+ Cargo Tonnes Handled Flights Handled Kitchens across Asia1 Meals Served Note
Slide 44: Clear strategic priorities to unlock value
<Public> Clear strategic priorities to unlock value Value Creation 1 2 3 We continue to deliver on our commitment to restore and enhance profitability, to Scaling Driving operating pursue our three R initiatives: Rationalise portfolio revenue for sustainable leverage through cost footprint business
Slide 45: Growing scale, enhancing margins
<Public> Growing scale, enhancing margins 8.0 Target CAGR 8.0 6.0 (FY24–FY29) 6.6 ~22% 4.9 6.0 5.1 ~21% Revenue (S$bn) 4.0 75% ~7.0% 18% 4.0 1.9 2.0 0.9 2.0 18% 1.7 25% ~13.0% 1.1 1.1 19% 7% ~15% ~17% 0.0 FY20 FY24 FY27 Target FY29 Target Food Solutions Gateway Services Target EBITDA margin 45 <Publ
Slide 46: Financial goals & ratios
<Public> Financial goals & ratios Profitability FY24 FY29 Target EBITDA Margin EBIT Margin SoAJV Run-rate PATMI Margin >20% >10% >S$150M >5.0% 15.2% 4.7% S$110M 1.1% Balance Sheet Health Our FY29 targets for Total Assets Equity Total Debt SATS Group ~S$10.0bn ~S$3.5bn <S$4.0bn S$8.5bn S$2.4bn S$4.1b
Slide 47: 5 Year CAPEX Plan
<Public> 5 Year CAPEX Plan Group Spend 70% Gateway Services FY25 to FY29 Total Spend: ~5% of revenue = Maintenance: ~3% of + Growth: ~2% of 30% Food Solutions revenue revenue 47 <Public>
Slide 48: Closing Remarks
<Public> Closing Remarks Kerry Mok, President and Group CEO <Public>
Slide 49: Flightpath to sustainable growth and value by FY29
<Public> Flightpath to sustainable growth and value by FY29 1 A right to win delivered by the global network, infrastructure and expertise 2 Focused strategy to gain market share and enhance margins 3 Best-in-class capabilities and continued operational excellence 4 A highly experienced global manag