Hemas Holdings Ltd. · CSELK:HHL.N0000

Hemas — Q2 FY23 Earnings Presentation

43 slides from Hemas's earnings presentation, November 2022

  1. Slide 1: Hemas Holdings PLC Earnings Call – Q2 FY23

    Hemas Holdings PLC Earnings Call – Q2 FY23 1

  2. Slide 2: Who We Are

    WHO WE ARE Key Milestones 1948 “Established Hemas Drugs Pvt Ltd” “IPO on the Colombo Stock 2003 Exchange” Established in 1948, Hemas Holdings is one of Sri Lankan’s leading conglomerate with focused interest in Consumer and Healthcare. “Extended operations into 2007 Listed in the Colombo Stock Excha

  3. Slide 3: Implications of Key Macro Economic Parameters on HHL

    IMPLICATIONS OF KEY MACRO ECONOMIC PARAMETERS ON HHL Surge In Inflation Depreciation of LKR Global Commodity prices “Change in consumer buying “Input cost inflation with increased “Prices of key commodities saw a patterns with reduced disposable cost on imported raw materials and declining momentum

  4. Slide 4: Key Strengths

    BOM Group CEO Nomination & Group Audit Governance Committee Committee Board Human Related Party Resources & Transactions Remuneration Review Committee Committee Diversified and competent Leadership Team Presence in key defensive segments Sound Corporate Governance Healthcare and Consumer Structure w

  5. Slide 5: Corporate Governance

    Corporate Governance BOM Group CEO BOM (Board of Management) Consists of the senior leadership team of 9 members - MDs of our 5 major businesses and 4 leaders from Corporate Nomination & Office. BOM is responsible for formulation and implementation of Group strategic plan and ensures that the Group

  6. Slide 6: Strategic Building Blocks

    STRATEGIC BUILDING BLOCKS Building more from New within the core New business and Efficiencies the core and Adjacencies Internationalisation Accelerate current Capturing new revenue Explore attractive Efficiency and business efforts to drive streams to further opportunities in new productivity to fu

  7. Slide 7: Our Strategic Building Blocks – Q2 FY 2022-23

    Our Strategic Building Blocks – Q2 FY 2022-23 MORE FROM THE CORE NEW WITHIN THE CORE • HPC SL : Achieved the highest ever market shares for brands such as ‘Clogard’ • HPC SL: Dandex launched the ‘Head and Hair’ range for dandruff free soft and and ‘Fems’ for the quarter. Achieved the highest ever ov

  8. Slide 8: New Product Launches during the Quarter

    New Product Launches during the Quarter Home and Personal Care Sri Lanka Pharmaceutical Manufacturing Baby Cheramy 70 g Budget Pack Morison ‘Bisoprolol 5mg’, Chor Mor “Used in treating high blood pressure and other cardiovascular conditions” Bisoprolol tables are now being manufactured locally for t

  9. Slide 9: Financial Snapshot

    FINANCIAL SNAPSHOT EBIT BY SEGMENT (LKR MN) 2,693 1H CONTRIBUTION TO GROUP 500 1,966 36% 2% 2,031 212 1,547 62% 1,211 434 20% 682 41% Revenue 230 54% 63 1,137 704 668 EBIT 615 1,393 995 1,153 936 583 Consumer Healthcare Mobility (319) (346) (410) (260) (579) FY20 Q2 FY21 Q2 FY22 Q2 FY23 Q2 FY23 Q1 L

  10. Slide 10: Sector Performance Summary – 1H FY 2022-23

    Sector Performance Summary – 1H FY 2022-23 Revenue Walk EBIT Walk (LKR Mn) (LKR Mn) 462 -122 4,724 6,030 -269 -47 51,960 1,030 10,013 716 36,234 2,638 1H FY 22 Healthcare Consumer Mobility Other 1H FY 23 1H FY 22 Healthcare Consumer Mobility Other 1H FY 23 Note: The ‘other segment’ includes the corp

  11. Slide 11: Sector Performance Summary – Q2 FY 2022-23

    Sector Performance Summary – Q2 FY 2022-23 Revenue Walk EBIT Walk (LKR Mn) (LKR Mn) 270 -64 2,693 2,671 -126 27,119 -52 543 4,797 398 19,829 1,547 Q2 FY 22 Healthcare Consumer Mobility Other Q2 FY 23 Q2 FY 22 Healthcare Consumer Mobility Other Q2 FY 23 Note: The ‘other segment’ includes the corporat

  12. Slide 12: Continuing Operation EPS and Capital Employed – 1H FY 2022-23

    Continuing Operation EPS and Capital Employed– 1H FY 2022-23 EPS Walk Sector Efficiency (LKR Per Share) Capital Employed, ROCE, and EBIT by Sector 3.50 -1.30 Mobility 80% -0.75 LKR 993.6Mn Consumer -0.36 3.74 LKR 1,914.9 Mn 60% Healthcare 35.7 % LKR 2,546.0Mn 2.65 40% 23.6 % 52.6 % 20% Group ROCE :2

  13. Slide 13: Consumer Brands

    Consumer Brands Home and personal care – Sri-Lanka Home and personal care – International Learning Segment 13 COPYRIGHT © 2022 | HEMAS HOLDINGS PLC

  14. Slide 14: Consumer Brands

    Consumer Brands Contribution to Group Sector Performance – 1H FY 2022-23 Revenue % 37% Key Highlights Revenue (LKR Mn) 35.9% • Inflation continued to affect consumer 38% (YoY) behaviour with over 70% year-on-year 9,698 10,119 NCPI growth in September. 8,262 8,713 Q2FY23 9,000 7,448 • Reduced purchas

  15. Slide 15: Home and Personal Care – Sri Lanka

    Home and Personal Care – Sri Lanka Key categories with market Purpose-driven brands touching the lives of the Sri Lankan consumer 8 leading positions Launched ‘Gold’ 3 in 1 solution Inclusive Strong roots Parenting Stronger Make a Celebrating & Enabling Both parents together Positive Difference Nurt

  16. Slide 16: Home and Personal Care Sri Lanka: Strong Brand Portfolio

    Home and Personal Care Sri Lanka: Strong Brand Portfolio of business - Hemas is 95% among the Top 3 players #1 #1 #1 #2 In Hair Oil In Beauty Soap In Baby Care In Feminine Care Presence in all modern trade chains and outlets of households 98% reached by Hemas #2 #2 brand In Laundry Care In Oral Care

  17. Slide 17: Our Consumer Health Brands

    Our Consumer Health Brands Skincare Baby Care Cold and Flu 17 COPYRIGHT © 2022 | HEMAS HOLDINGS PLC

  18. Slide 18: Update on Key Strategic Initiatives

    Opportunities in Urbanisation and Premiumisation will UPDATE ON KEY be the platform to drive growth STRATEGIC INITIATIVES Urban Population across peer nations 52% “Premiumisation and expanding into key 2021 2015 39% 35% Emerging Trends in underpenetrated categories will be the 31% the Consumer Space

  19. Slide 19: Update on Key Strategic Initiatives

    UPDATE ON KEY Clean beauty that prioritises natural ingredients are a STRATEGIC INITIATIVES prime aspect in the future of personal care. Percentage of people who look for Global Natural and Organic “Fine blend of Innovation and the products that uses natural ingredients personal care Market ($ Bn) u

  20. Slide 20: Home and Personal Care – International

    Home and Personal Care – International Locally led and localised in Bangladesh Reach in Bangladesh 2 Geographies Bangladesh & West Bengal • All products are exclusively designed for Rural penetration Bangladesh. 19.0% by Hemas 2 Key categories Health soap category—Actisef • Extensive product portfol

  21. Slide 21: Home and Personal Care – Sri Lanka and International

    Home and Personal Care – Sri Lanka and International Sri Lanka International Revenue (LKR Mn) 52.8% Revenue Revenue (YoY) • Volumes witnessed a declining momentum amidst the inflationary pressure. 7,253 7,799 • With the challenging macro economic conditions, 5,904 volumes contracted by over 5%. • Mu

  22. Slide 22: Atlas: Where We Inspire the Next Generation to Unleash Their Potential

    Atlas: Where We Inspire the Next Generation to Unleash Their Potential “We provide tools, content and experiences which will enable the next generation to unleash their potential” Carefully Crafted Brand Portfolio Atlas KIDS in Line with Growth Areas Catering to all stationery and back-to-school • O

  23. Slide 23: Update on Key Strategic Initiatives

    UPDATE ON KEY Explore opportunities to expand geographical reach STRATEGIC INITIATIVES via partnering with global players Middle east Stationery market will grow “Learning Segment : Widening the business at a CAGR of 1.3% to reach $ 321.6 Global Stationery Market ($ Billion) Mn in 2025 scope to expa

  24. Slide 24: Learning Segment

    Learning Segment Revenue 6 Key categories • While all verticals saw decline in volume, Atlas managed to gain market share in key categories. Revenue (LKR Mn) • Improved revenue from export initiatives and the premium brand ‘innovate’ contributed to the High Efficiency and productivity 4,200 4,073 re

  25. Slide 25: The Growing Economy of Bangladesh

    THE GROWING ECONOMY OF BANGLADESH Promising Macro economic factors to support growth and expansion GDP Growth Forecasts $ 460.8 Bn GDP 2022 FY 2024-25 8.0% FDI friendly tax laws and incentives FY 2023-24 7.8% $ 2,730 Access to labour at attractive prices GDP Per Capita. FY 2022-23 7.2% Strategic Loc

  26. Slide 26: Healthcare Sector

    Healthcare Sector Pharmaceutical Import, Marketing and Distribution Pharmaceutical Manufacturing Hospitals 26 COPYRIGHT © 2022 | HEMAS HOLDINGS PLC

  27. Slide 27: Healthcare Sector

    Healthcare Sector Contribution to Group Sector Performance – 1H FY 2022-23 61% Revenue % Key Highlights Revenue (LKR Mn) 40.9% (YoY) • COVID-19 pandemic driven volatility was 59% 16,523 15,675 minimal during the quarter. 16,000 14,000 • Sri Lanka continued to obtain support Q2FY23 12,427 12,000 11,7

  28. Slide 28: Pharmaceutical Import, Marketing, Distribution and Pharmaceutical Manufacturing

    Pharmaceutical Import, Marketing, Distribution and Pharmaceutical Manufacturing Pharmaceutical Import, Marketing, and Pharmaceutical Manufacturing Morison Plant and Key Highlights Distribution NPD focused separate manufacturing Principals Formulations - Manufacturing line consisting of advanced tech

  29. Slide 29: Update on Key Strategic Initiatives: Homagama Factory

    UPDATE ON KEY Opportunities to enter into global supply chain via STRATEGIC INITIATIVES contract manufacturing due to Sri Lanka’s proximity to “Homagama Factory” India and availability of infrastructure and know how Key Export Markets for Sri Lanka “Homagama factory: Annual capacity of 5 Global Phar

  30. Slide 30: Pharmaceutical Import, Marketing, Distribution and Pharmaceutical Manufacturing

    Pharmaceutical Import, Marketing, Distribution and Pharmaceutical Manufacturing Revenue • Despite the challenges, Pharmaceutical arm of Hemas ensured continued Revenue (LKR Mn) supply of medicine into the country liaising with principals, banks and other stakeholders . 46.1% • Multiple successful la

  31. Slide 31: First Internationally Accredited Hospitals Chain in Sri Lanka

    The first Internationally accredited hospitals chain in Sri Lanka by the Australian Council on Healthcare Standards International Hemas Hospitals Highlights Centers of Excellence: “The first Internationally accredited hospitals chain in Sri Lanka by the Australian • In vitro fertilization unit (IVF)

  32. Slide 32: We Have a Widespread Lab Network

    We have a widespread Lab Network 50+ Labs & Collection Centers Lab Network Highlights Q2 FY 2022-23 Performance across the Country Centers of Excellence: • Main Lab Services to Hospitals 258k+ (8 B2B Labs +3 B2B CCs) Test volumes • Outer Labs services across the country (14 Labs) 2+ • Collection cen

  33. Slide 33: Update on Key Strategic Initiatives

    UPDATE ON KEY Building depth and scale of identified anchor and super STRATEGIC INITIATIVES specialties “Capacity expansion via opportunities for Urology: The prevalence of Chronic Kidney organic and inorganic growth ” Disease is 15.1–22.9% in farming districts. Cardiovascular: Incidence of coronary

  34. Slide 34: Hospitals

    Hospitals Revenue 170+ Beds • Despite the slowdown in COVID-19 related revenue the core businesses witnessed a growth of over 30% with high occupancy and Revenue (LKR Mn) admissions. 1.8% 2,000 1,902 (YoY) 64% Hospital occupancy 1,770 1,802 Profitability 1,546 • Despite the margin impact from lower

  35. Slide 35: Mobility Sector

    Mobility Sector Maritime Aviation 35 COPYRIGHT © 2022 | HEMAS HOLDINGS PLC

  36. Slide 36: Mobility Sector

    Mobility Sector Contribution to Group Sector Performance – 1H FY 2022-23 2% Revenue % Key Highlights Revenue (LKR Mn) 3% 1,000 • Decline in revenue is due to due to the (21.2%) divestment of the logistic operation in Q2FY23 595 (YoY) Q3 FY22. 444 469 Q2FY22 500 410 363 • Restrictions on imports and

  37. Slide 37: Mobility Sector

    Mobility Sector 2Far Shipping line – Evergreen line & Far Shipping “Offering a Full Spectrum of End-to-end Services across Land, Sea and Air” Emirates cargo : Average daily 200,000+ TEUs freight capacity of 75 tons. Represents the leading - 1H FY 23 Facilitating over 1000+ Emirates Passenger : feede

  38. Slide 38: Group Environmental Agenda

    GROUP ENVIROMENTAL AGENDA Hemas will play a leading role in helping sustain and nurture all that is Sri Lankan Protecting Safeguarding Negombo Eco System 52 10,000+ KG Critically Endangered Estimated Annual Plastic Endemic Species Collection 38 COPYRIGHT © 2022 | HEMAS HOLDINGS PLC

  39. Slide 39: Supporting Our Communities

    SUPPORTING OUR COMMUNITIES Creating an inclusive world and eliminating inequality Creating a social security net 61st 4,000+ 150+ Providing emergency relief to Piyawara Children Teachers 112,000+ Pre School Daily Families 60 COVID-19 Community Aid Package 30 Years Parental Providing lifesaving medic

  40. Slide 40: Sustainability Performance – Q2 2021-22 vs Q2 2022-23

    Sustainability Performance – Q2 2021-22 vs Q2 2022-23 Values of Fines for Non-Compliance Carbon Footprint (per Rs. Mn Revenue) 0.14 MT 42% with Laws and Regulations in the NONE Social Economic Area Water Consumption Total Work-Related Injury Rate (per Rs. Mn Revenue) 1.6 m3 34% (per 100 employee) 0.

  41. Slide 41: Focus Areas

    FOCUS AREAS Short -Term Mid – Long Term Grow Market Share Acquisitions/expansion in consumer and healthcare Develop value creating products Atlas’s transition from stationery Expanding the regional footprint with manufacturing to learning high focus in Bangladesh Expand global footprint into Maintai

  42. Slide 42: Short Term Outlook and Strategies on Navigating the Economic Crisis

    SHORT TERM OUTLOOK AND STRATEGIES ON NAVIGATING THE ECONOMIC CRISIS • Leverage on the strong relationships with external and internal stakeholders to minimise the possible adverse impact on businesses due to temporary political and economic headwinds. • Implement strategies to maintain optimum level

  43. Slide 43: Thank You!

    THANK YOU! COPYRIGHT © 2022 | HEMAS HOLDINGS PLC

Hemas Holdings — Q2 FY23 Earnings Presentation on 6ix