Evergreen Fibreboard Bhd. · MYX:EVERGRN
Evergreen Fibreboard Bhd — Shareholder Meeting (August 2021)
32 slides from Evergreen Fibreboard Bhd's shareholder meeting presentation, August 2021
Slide 1: 30th Annual General Meeting
30TH ANNUAL GENERAL MEETING Briefing on FYE2020 Financial Results
Slide 2: Disclaimer
Disclaimer This corporate presentation may contain forward-looking statements. All statements other than statements of historical facts contained in this presentation. Including, without limitation, those regarding our financial position, business strategies, plans and objectives of our Group for fu
Slide 3: Table of Contents
Table of Contents About EVERGREEN Business Overview Financials Challenges Challenge Management Opportunities Strengths Looking Ahead Salient Points 3
Slide 4: About EVERGREEN
About EVERGREEN
Slide 5: EVERGREEN – A Quick Snapshot
EVERGREEN – A Quick Snapshot Started in 1972 as a timber trading and veneer manufacturing company Over 49 years, the Group has grown to a multi-product entity (e.g. veneer to laminates, to medium density fibreboard (MDF) and particleboard (PB), and then to ready-to-assemble furniture) Manufact
Slide 6: Business Overview
Business Overview
Slide 7: What We Do
What We Do RTA Medium Density Fibreboard (MDF) Furniture 9% Manufacturing of MDF, an engineered wood product made by Value-Added Products breaking down wood residual into 16% wood fibres, combining it with wax MDF & PB and resin binder to form panels. 75% Value-added products include melamine, venee
Slide 8: Global Footprint
Global Footprint Far East Asia Africa 8% Middle East 8% South Asia 24% 1% America 10% Europe 2% Revenue Far East Far East South East Africa 6% Asia South Asia Africa Asia Asia FYE 2020 South Asia 4% 6% 6% 1% 47% 1% Middle East America 31% America Middle 6% 4% East Europe 41% Europe 4% 4% South East
Slide 9: Leading MDF Producer in ASEAN
Leading MDF Producer in ASEAN (‘000) MDF PB Resin RTA (m³) (m³) (MT) (m³) Hat Yai, Thailand Malaysia 590 312 192 70 MDF Manufacturing 600,000 m³ Thailand 600 - - - Power Generation 18MW Gurun, Kedah Indonesia 120 - - - Resin Manufacturing 96,000 MT Total 1,310 312 192 70 Nilai, Negeri Sembilan MDF M
Slide 10: Financials
FINANCIALS
Slide 11: FY20 Financial Performance Review
FY20 Financial Performance Review FY FY 1Q RM’m Group revenue in FY2020 dropped due to MCO lockdown 2019 2020 2021 and movement restrictions. Revenue 967.9 859.8 233.2 GP Margin has improved due to higher average selling price Gross Profit 125.4 134.5 40.6 and improved overhead cost control. Adj
Slide 12: Resilient Financial Position to Face Challenges
Resilient Financial Position to Face Challenges RM’m 2019 2020 PPE 1,022.1 925.6 Cash of RM122m reinforces the sustainability of the Non-Current Assets 87.8 85.5 Group Current Assets ex Cash 363.2 318.4 Drop in current assets due to reduction in inventories Cash 104.8 122.5 and receivables to im
Slide 13: Financial Flexibility to Pursue Growth
Financial Flexibility to Pursue Growth RM’m 2019 2020 Operating cash flows before The Group almost doubled the INFLOW of 52.2 91.8 working capital changes operating cashflow of RM92mil before working Changes in working capital and capital changes despite challenging environment. (18.2) (26.6) othe
Slide 14: Challenges
CHALLENGES
Slide 15: Challenges in 2021
Challenges in 2021 MACROECONOMICS & POLICIES Restrictions due to Covid-19 Lockdowns resulted in factories not allowed to operate and reduced consumer due to less income Malaysia imposed FMCO, affecting Group’s operations since June 1st, 2021. Logistical challenges Shortage of containers an
Slide 16: Challenge Management
CHALLENGE MANAGEMENT
Slide 17: Managing Challenges: Strategies & Team Efforts
MANAGING CHALLENGES STRATEGIES & TEAM EFFORTS Responding to Covid-19 The Group is cautious and practices prescribed SOPs to prevent Covid19 clusters in its premises Facilitate vaccination exercises for all employees who want to participate To increase production MDF output from Thailand to c
Slide 18: Opportunities
OPPORTUNITIES
Slide 19: Opportunities in 2021
Opportunities in 2021 MACROECONOMICS & POLICIES US-China Trade War US-China trade wars made it impossible for Chinese manufacturers to sell to US Many Chinese firms are moving out from China to setup furniture plants in SEA This will benefit the Group as we can supply MDF and PB boards as ra
Slide 20: Strengths
STRENGTHS
Slide 21: Stability through diversity: Vertically Integrated Operations & Wide Customer Base
Stability through diversity Vertically Integrated Operations & Wide Customer Base Sustainably Integrated Operations • Manufacture adhesives for in-house needs • Experienced in managing rubber wood log harvesting concessions • Produce different kinds of engineered wood (e.g. MDF, PB, sawntimber) •
Slide 22: Stability through diversity: Diversified base of operations
Stability through diversity Diversified base of operations Manufacturing presence in Malaysia, Thailand and Indonesia Each country allows access to different markets • Malaysia – Great infrastructure, top 10 furniture exporter in world, provide big market for panel board • Thailand – Top rubber
Slide 23: Captive Market over Malaysian Furniture Industry
Captive Market over Malaysian Furniture Industry Centre of Malaysian Furniture Industry is Literally in Our Backyard Large Captive Local Market • Evergreen is a long established Malaysian MDF supplier with a strong reputation • Malaysia is top 10 furniture exporting countries in the world • The fu
Slide 24: Future Potential in Indonesian Market
Future Potential in Indonesian Market Local Presence in Indonesia Domestic Indonesian Market • Indonesia has big potential as its middle class is growing rapidly • Local furniture industry is largely undeveloped giving rise to significant future growth potential for panel boards • Sheltered from i
Slide 25: Looking Ahead
LOOKING AHEAD
Slide 26: Continued Enhancements in 2H2021
Continued Enhancements in 2H2021 UPCOMING ENHANCEMENTS Improve Capacity utilization rate in Thailand Management expects MDF capacity utilization rate to improve by the fourth quarter of FY2021 to meet increasing demand and to act as back-up against future production disruptions in Malaysia Ref
Slide 27: Salient Points
SALIENT POINTS
Slide 28: Why revenue decreased by 11% for FY2020?
SALIENT POINTS Why revenue decreased by 11% for FY2020 ? Revenue drop mainly due to production disruption in Malaysia from MCO MCO and other variants of movement control orders in Malaysia resulted in production disruptions ranging from complete stoppage to running at reduced capacities Malays
Slide 29: Thailand Operation – A turn-around
SALIENT POINTS THAILAND OPERATION – A turn-around Group’s losses after tax are due to: One-off non-cash impairment write-down of assets mainly from its solid wood furniture operations in Thailand whose sole target market was China. As China’s economy was at a stand-still in the first half of FY2
Slide 30: Balance sheet and Liquidity Management
SALIENT POINTS Balance sheet and Liquidity Management To ensure sufficient financial liquidity: Reduced receivables and inventories to improve cash inflow Receivables on average maintain within 30-40 days collection period via constant monitoring Increased utilization of trade facilities while
Slide 31: Across-Board Improvement
SALIENT POINTS ACROSS-BOARD IMPROVEMENT Improved prospect of MDF MDF export market has seen marked improvement especially since beginning 2021 Higher average selling prices and stronger USD vs RM and THB have helped the Group’s financial performance by cushioning against FMCO lockdown. Conti
Slide 32: Thank You
Thank You
Evergreen Fibreboard Berhad — Shareholder Meeting (August 2021) on 6ix