Yip's Chemical Holdings Limited · HKEX:408
Yip's Chemical — FY2006/07 Earnings Presentation
30 slides from Yip's Chemical's earnings presentation, 2007
Slide 1: Annual Results Announcement 2006-2007
(SEHK: 408) 2006-2007 Annual Results Announcement 0
Slide 2: Disclaimer
Disclaimer The information on these slides does not constitute a recommendation by financial adviser or selling agent that any recipient should invest in the Company. Recipients should make their own independent appraisal, evaluation, assessment and investigation as deemed necessary by them. 1
Slide 3: Programme
Programme Chairman’s Remarks Financial Highlights Core Businesses Analyses Corporate Development Consolidated Financial Statements 2
Slide 4: Chairman's Remarks
Chairman’s Remarks Results meeting our expectations Growth in turnover 18% Growth in profit attributable to shareholders 33% Strong cash flow status The Group has passed the phase of high capex investments Gearing declined to only 14% despite sustained growth and high dividend payout Corporate mediu
Slide 5: Chairman's Remarks
Chairman’s Remarks The Core Businesses Targets and strategies differ in view of different business nature Solvents Continues to be the biggest core business Growth strategy via capacity expansion and acquisitions Total capacity to grow from 260 kT to 330 kT Will study opportunities in other regions
Slide 6: Chairman's Remarks
Chairman’s Remarks Future plans Clear vision ahead: continue to focus on the core businesses, continue to focus on the China market Favourable business environment As China’s economy continues its rapid growth, opportunities abound for the Group’s growth Will continue to seek to achieve the best pos
Slide 7: Financial Highlights
Financial Highlights Year ended 31 March (HK$’000) 2007 2006 % change Turnover 3,913,835 3,329,670 +18% Gross Profit 792,598 662,459 +20% Profit Margin 20% 20% - Net Profit Attributable 223,636 168,389 +33% to equity holders Earnings Per Share 46.6 cents 35.5 cents +31% Full Year Dividend 20 cents 1
Slide 8: Core Business Analyses
Core Business Analyses Solvents Coatings Lubricants 7
Slide 9: Core Business Analyses: Turnover Distribution
Core Business Analyses: Turnover Distribution Turnover (HK$ ’000) % Breakdown Product Year ended 31 March Year ended 31 March 2007 2006 % change 2007 2006 Solvents* 2,241,251 1,973,581 +14% 57% 58% Coatings 1,442,874 1,196,034 +21% 37% 35% Lubricants* 205,524 219,314 –6% 5% 7% * Minority interests i
Slide 10: Core Business Analyses: Profits from Operations
Core Business Analyses: Profits from Operations 2006 2007 HK$ ’000 280,000 252,324 240,000 200,000 157,262 160,000 120,000 80,568 88,501 80,000 40,000 0 -296 -6,384 -40,000 Solvents* Coatings Lubricants* * Minority interests in Solvents and Lubricants businesses 9
Slide 11: Core Business Analyses: Overview
Core Business Analyses: Overview Solvents recorded unprecedented results, with significant profit increase by 60% Coatings business sustained strong growth momentum, achieving turnover growth of 21%, but profitability affected by continued high raw materials prices Lubricants business restructuring
Slide 12: Core Business Analyses: Solvents
Core Business Analyses: Solvents Raw solvents growth limited by capacity constraints, but mixed solvents provided impetus for turnover growth Significant gain in profits mainly attributed to favourable operating environment for raw solvents, especially in 1H, and the efforts of “Solvents Task Force”
Slide 13: Core Business Analyses: Shengda M&A Deal
Core Business Analyses: Shengda M&A Deal Group announced Share Transfer Agreement in June 2007 with Heng Feng and Hang Sing to acquire the entire equity interest of 盛達化工有限公司 (Shengda) at a consideration of RMB71,626,109 (approx. HK$73,774,892). Upon completion, Shengda will become an indirect 75% ow
Slide 14: Core Business Analyses: Coatings
Core Business Analyses: Coatings Coatings-related industries (real estate, publishing, packaging, light industrial products etc.) benefited from rapid growth of China’s economy Enhanced efforts on brand management, resulting in increased marketing expenses Recent shake-up in the industry due to entr
Slide 15: Core Business Analyses: Lubricants
Core Business Analyses: Lubricants Operating environment still extremely difficult; pressure on base oil supply eased in 2H, but competition significantly intensified as major competitors aggressively pursued discount policies to reduce inventory levels, eroding profit margins of both automotive and
Slide 16: Corporate Development: New Group Management Structure
Corporate Development New Group Management Structure Beginning 1st April 2008, Group will implement new management structure The positions of Chairman of the Board and Chief Executive Officer will be separated and held by two individuals The Board: Principal duties include setting policies, monitori
Slide 17: Summary
Summary Looking ahead, the Group is confident of its future development as China’s economy and domestic consumption continue to grow. This will ultimately pose unlimited opportunities for long-term growth and development. The Group will remain dedicated to its core businesses – Chemicals, and focuse
Slide 18: Consolidated Financial Statements
Consolidated Financial Statements Turnover Net Profit Attributable to Equity Holders Dividends Per Share Consolidated Cash Flow Statement Liquidities and Financial Resources 17
Slide 19: Turnover
Turnover Full Year Interim HK$’,000,000 4,500 3,914 4,000 3,330 3,500 3,000 2,678 2,500 2,062 2,000 1,799 1,761 1,423 1,356 1,500 1,113 892 1,000 735 599 500 0 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 18
Slide 20: Net Profit Attributable to Equity Holders
Net Profit Attributable to Equity Holders Full Year Interim HK$’,000,000 250 223.6 200 168.4 150 128.4 123.2 103.2 96.2 93.9 100 76.0 60.0 62.4 60.2 50 31.7 0 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 19
Slide 21: Dividend Per Share
Dividend Per Share Full Year Interim HK cents 24 22 20* 20 18 16 14 14 12 12 10 9 10 8* 8 6 4.5 5 6 4 4 4 2.5 2 0 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 * Include HK 2 cents special dividend 20
Slide 22: Consolidated Balance Sheet
Consolidated Balance Sheet 2007 2006 % change (audited) (audited) Non-current Assets 663,614 571,725 +16.1% Current Assets 1,599,591 1,304,599 +22.6% Current Liabilities (971,990) (725,424) +34.0% Net Current Assets 627,601 579,175 +8.4% Non-current Liabilities (57,528) (167,679) -65.7% Capital and
Slide 23: Consolidated Cash Flow Statement
Consolidated Cash Flow Statement Year ended 31 March ( HK$’000) 2007 2006 Net Cash Inflow (Outflow) - Operating Activities 285,013 151,422 - Investing Activities (90,509) (95,446) - Financing Activities (138,403) 32,614 Net increase in cash and cash equivalents 56,101 88,590 Cash & Cash Equivalents
Slide 24: Liquidities and Financial Resources
Liquidities and Financial Resources 31 March 2007 14% Gearing Ratio 31 March 2006 28% 2008/09 2007/08 Estimated Capital First Half 100,000 140,000 Investments Second Half 110,000 60,000 (HK$’000) 210,000 200,000 Utilized 702,612 Banking Facilities Utilization Reserved 743,948 (HK$’000) As at 31 Marc
Slide 25: Q & A Session
ey Rit L YIPSCHEMICAL Q & A Session
Slide 26: Appendices
ey Rit L YIPSCHEMICAL APPENDICES
Slide 27: New Group Logo
New Group Logo New logo unveiled on 25th October 2006, which marked 35th anniversary of founding of the Group New logo signifies Group’s determination to innovate, reform, while remaining steadfast focus on its core businesses Largely based on the old logo, the new logo features refreshing green as
Slide 28: Social Responsibility
Social Responsibility The Group strives to put efforts in projects that are in line with its core values: Environmental Protection Being engaged in the chemicals businesses, the Group recognizes the importance in environmental protection Constantly endeavor to educate and increase awareness of envir
Slide 29: Consolidated Turnover
Consolidated Turnover Full year Second half First half HK$ million 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 3/87 3/88 3/89 3/90 3/91 3/92 3/93 3/94 3/95 3/96 3/97 3/98 3/99 3/00 3/01 3/02 3/03 3/04 3/05 3/06 3/07 28
Slide 30: Profit Attributable to Equity Holders before Non-recurring Items
Profit Attributable to equity holders of the Company before Non-recurring Items Full year Second half First half HK$ million 240 220 200 180 160 140 120 100 80 60 40 20 0 -20 3/87 3/88 3/89 3/90 3/91 3/92 3/93 3/94 3/95 3/96 3/97 3/98 3/99 3/00 3/01 3/02 3/03 3/04 3/05 3/06 3/07 29
Yip's Chemical Holdings — FY2006/07 Earnings Presentation on 6ix