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Investor presentation 1H 2012/13

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Investor presentation 1H 2012/13

  1. 1. HEMAS HOLDINGS PLC Investor Presentation 1H 2012/13
  2. 2. Macro Highlights
  3. 3. Sri Lanka: Macro Highlights GDP Growth slows to 6.4% 12M T-Bill Rate peaks around 13%8.2% 8.4% 8.3% 12.88% 13.02% 7.9% 12.48% 11.32% 9.31% 6.4% 7.31% Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Sept 2011 Dec 2011 March 2012 June 2012 Sept 2012 Oct 2012 Rupee recovers after a 20% slip Inflation hovers around 9% 9.3% 9.1% 8.9% 135.46 131.17 131.6 129.57 6.4% 5.5% 4.9% 114.88 111.05Sept 2011 Dec 2011 March 2012 June 2012 Sept 2012 Oct 2012 Sept 2011 Dec 2011 March 2012 June 2012 Sept 2012 Oct 2012 Source - CBSL
  4. 4. Hemas GroupFMCG Healthcare Leisure Transportation Power Pharma Hotels GSAs Hydro Destination Hospitals Travels Thermal Management Maritime Bio Mass Logistics
  5. 5. 1H Performance Review
  6. 6. Hemas Group: A SnapshotShare Price (As at 21.11.2012) Rs. 27.90Market Capitalization Rs. 14.4Bn% of Total Market 0.70%PER 10.2*PBV 1.27No of Shares 515,290,620Public Shareholding 28.33% PER Sector & Market PER vs Hemas PER35.030.025.020.015.010.0 5.0 - June 2011 Sept 2011 Dec 2011 Mar 2012 June 2012 Sept 2012 * PER based on annualized earnings Diversified Sector PER Market PER Hemas PER
  7. 7. Hemas Group: Performance HighlightsFigures are in Rs. Millions 1H 2012/13 1H 2011/12 % ChangeGroup Turnover 12,886 9,991 29%PAT 771 527 46%Group Earnings 705 486 45%Cash From Operations 110 -45 346%Total Assets 24,419 19,345 26%Shareholders’ Funds 11,359 9,347 22%Capital Employed 18,242 14,769 24% 1H 2012/13 1H 2011/12 % ChangeEPS 2.74 1.89 45%Net Assets per Share 22.04 18.14 22%ROE 13.6% 11.1% 23%ROCE 12.6% 9.8% 29% All financials as per SLAS
  8. 8. Consumer Businesses Drive Revenue Group Turnover Revenue Contribution – 1H 2012/13Revenue in Annual RevenueRs. Millions 4% Growth 25,000 25% 29% FMCG 24% Healthcare 20% Leisure 20,000 Transportation Power 4% 15% Other 5% 15,000 35% 10% 10,000 5%  Group turnover recorded a 5,000 growth of 29%, YoY 0%  Revenue growth was driven by Power, Healthcare and - -5% 2007/08 2008/09 2009/10 2010/11 2011/12 1H 2012/13 FMCG sectors 1H Revenue YoY Growth
  9. 9. Group Earnings on an Upward Trend Group Earnings Earnings Contribution – 1H 2012/13Earnings in Annual EarningsRs. Millions Growth 10%1,400 40.0% 17% FMCG 30.0% 39% Healthcare1,200 Leisure 20.0% Transportation1,000 5% Power 10.0% 800 0.0% 29% 600 -10.0% 400  Group earnings recorded a -20.0% growth of 45%, YoY 200 -30.0%  Earnings growth was driven - -40.0% by FMCG, Leisure, Healthcare 2007/08 2008/09 2009/10 2010/11 2011/12 1H 2012/13 and Transportation sectors 1H Earnings YoY Growth
  10. 10. Earnings Growth Boosts ROE EPS and EPS Growth Shareholders’ Funds vs ROE EPS Shareholders’ FundsEPS in Rs. Millions ROE Growth3.00 40% 12,000 20.0% 2.74 30%2.50 10,000 2.36 2.33 16.0% 14.6% 20% 13.6%2.00 8,000 12.3% 12.3% 1.76 10% 11.5% 12.0% 1.511.50 0% 6,000 8.0% -10%1.00 4,000 -20% 4.0%0.50 2,000 -30%0.00 -40% - 0.0% 2008/09 2009/10 2010/11 2011/12 2012/13 * 2008/09 2009/10 2010/11 2011/12 2012/13 * EPS EPS Growth Shareholders Funds ROE * 2012/13 is based on annualized 1H earnings
  11. 11. FMCG
  12. 12. Overview of FMCG Business Total FMCG market ~ Rs. 125Bn Hemas FMCG revenue contribution (Jan’12 to Sept’12) for 1H 2012/13 26% 14% 10% 20% 76% 54% Food and Beverages Personal Care Household Care Food and home care Personal care Personal washValue Growth : Jan - Sept ’12 Vs. Jan - Sept ’11 All Urban Rural  Comprises of 18 Popular brandsTotal FMCG 13% 14% 12%  No. 2 in Personal CareFood & Beverages 13% 15% 11%Personal Care 12% 13% 12%  Market leader in baby care, hair oil and men’s hair setting categoriesHousehold Care 14% 11% 15%
  13. 13. FMCG: Our Key Brands Most preferred range of baby care productsBaby Cheramy in Sri Lanka since 1962 Unique oral care product containing clove oilClogard No. 2 in oral care marketKumarika Leading hair oil in the market with indigenous herbs A leading washing powder in the marketDiva delivering excellent value to the consumer No.1 in beauty soap market surpassing LuxVelvet Won Bronze Award for Product Brand of the Year at the 11th SLIM Brand Excellence Awards
  14. 14. FMCG: Performance Highlights 1H 12/13 1H 11/12 Change  Strong performance in Personal wash and Turnover (Rs. Mn) 3,679 3,139 17% Personal care categories contributed PAT (Rs. Mn) 358 257 40% towards the growth in revenue  Steady increase in sales: SeptemberRevenue in PAT in Rs. recorded the highest ever sales valueRs. Millions Millions crossing the Rs. 700Mn sales mark 7,000 700 6,000 600  Excellent overall performance in Bangladesh business; turnover up by 166% 5,000 500  Impressive market share gain in Personal 4,000 400 wash category underpinned by Baby 3,000 300 Cheramy and Velvet soap 2,000 200  Margins on track after price corrections to offset the exchange impact 1,000 100 - -  Our sanitary napkin brand, Fems won the 2007/08 2008/09 2009/10 2010/11 2011/12 1H Silver Award for Best Turnaround Brand of 2012/13 the Year at the 11th SLIM Brand Excellence 1H Revenue 1H PAT PAT full year Awards
  15. 15. Big Heart Project Baby Cheramy, celebrates 50 years of enriching lives of Sri Lankan mothers and children The Big heart Project was launched together with the Department of Probation and Childcare Services of the Ministry of Child Development & Women Affairs, in September 2012, to celebrate this milestone The project will fund the educational needs of children that are at risk, or in danger of being institutionalized due to the financial difficulties of their families 50 cents from every Baby Cheramy product sold will be donated to fund the educational needs of children from grade 1-5 The Big Heart truck will travel across Sri Lanka and appeal to all Sri Lankans to open their hearts and donate towards this great cause
  16. 16. Healthcare
  17. 17. Overview of Pharmaceutical Distribution Size of the total Pharmaceutical market is Hemas Pharmaceutical revenue ~ Rs 27Bn (MAT Q2 2012) (Source IMS) contribution for 1H 12/13 Overall Pharmaceutical market has grown by 16.3% YoY (Source IMS) 4% Hemas Pharmaceutical remains the market 30% leader with a share of 17.55% (Source IMS) 66% Pharmaceutical market composition (approx): 33.1% Distributors (Pharmacies) Institutional Segment 66.5% 0.4% Supermarkets Branded Generic Generic Branded
  18. 18. Overview of Hospitals Outpatient and inpatient volumes at The number of registered private hospitals Hemas Hospitals Outpatient volume in Inpatient stood at 186 at end 2011, with a bed ‘000s volume capacity of 4,784 (Source- CBSL) 120 6,000 Combined market size of the 4 leading 100 5,000 hospitals ~ Rs. 17Bn for FY 2011/12 Revenue split among leading Hospitals: 80 4,000 60 3,000 6% Q1 Q2 Q3 Q4 Q1 Q2 19% 34% 2011/12 2011/12 2011/12 2011/12 2012/13 2012/13 Outpatient Inpatient 21% 21% Revenue in Rs. ‘000s Laboratory revenue at Hemas Hospitals 80,000 40,000 Asiri Nawaloka Lanka Hospitals Durdans Hemas Hospitals 0 Q1 11/12 Q2 11/12 Q3 11/12 Q4 11/12 Q1 12/13 Q2 12/13 Revenue split is based on Q1, 2012/13 financials
  19. 19. Health Care: Performance Highlights 1H 12/13 1H 11/12 Change Turnover (Rs. Mn) 4,462 3,631 23% PAT (Rs. Mn) 256 190 35%  Pharmaceutical business was the main contributor to sector revenue growthRevenue in PAT in Rs. • Revenue growth of Pharma: 21.8%Rs. Millions Millions • Revenue growth of Hospitals: 30.3%8,000 4007,000 350  Training and educational programs for doctors and community awareness6,000 300 projects along with high quality service5,000 250 standards contributed towards the4,000 200 revenue growth at hospitals3,000 150  Hemas Wattala Hospital recorded the2,000 100 highest number of baby deliveries in1,000 50 September since inception - - 2007/08 2008/09 2009/10 2010/11 2011/12 1H 2012/13 1H Revenue 1H PAT PAT full year
  20. 20. Leisure
  21. 21. Overview of Tourism Industry Travel Trends Sri Lanka Outbound travel forecast 2012:  Tourist arrivals during the year were World 2%; Europe 1%; Asia 4% 693,772 marking a growth of 16% and (IPK Survey) expect to top one million at the end of year Purpose of travel : 71% holidays of which 27% looks for sun and beach Tourist arrivals & occupancy rates Tighter budgets; looking for value for in 2012 money Tourist Arrivals Occupancy Rates 100,000 100.0% Tourists are becoming more 80,000 80.0% demanding 60,000 60.0% Travelers are searching for meaningful experiences 40,000 40.0% Web and mobile technologies are 20,000 20.0% emerging as powerful marketing tools - 0.0% Jan Feb Mar Apr May Jun Jul Aug Sep Tourist Arrivals Occupancy Rates Source - SLTDA
  22. 22. Leisure: Performance Highlights 1H 12/13 1H 11/12 Change  Sector performance was mainly driven by the Hotel sector and was enhanced by our Turnover (Rs. Mn) 656 453 45% inbound tour operation PAT (Rs. Mn) 90 -23 491%  Gross operating profit of the Hotel sector grew by an impressive 124% over LYRevenue in PAT in Rs.Rs. Millions Millions1,400 140  Occupancy rates of our hotels for 1H 120 2012/13:1,200 100 Sigiriya 75%1,000 80 Dolphin 85% 60 800 40 Avani Bentota 67% 600 20  Kani Lanka Resort & Spa rebranded as - 400 Avani Kalutara , was opened for guests in (20) 200 October 2012 (40) - (60)  Hotels under the Serendib Leisure 2007/08 2008/09 2009/10 2010/11 2011/12 1H 2012/13 umbrella are looking forward to a good 1H Revenue 1H PAT PAT full year winter season with favorable forward bookings
  23. 23. Transportation
  24. 24. Overview of Transportation IndustryMetricTonnes Air cargo volumes YoY Growth 7,000 25.0%  Import volumes in Sri Lanka declined 6,000 20.0% over LY on account of higher tariffs 5,000 while exports slowed down due to 4,000 15.0% unfavourable economic conditions in 3,000 10.0% the EU and US markets 2,000 5.0% 1,000  However, air export and transhipment 0 0.0% Apr May Jun Jul Aug Sep Oct volumes grew over LY which positively 2011/12 2012/13 Growth impacted the earnings growth of the Source – Sri Lankan Cargo sector TEUs Port of Colombo – Transshipment volumes  Main shipping lines re-aligned their290,000 capacities in and out of CMB which280,000 impacted freight rates and liner/feeder270,000 schedules260,000250,000  Infrastructure development throughout240,000 Sri Lanka created a significant demand230,000 for logistics facilities which is a focus220,000 Apr May Jun Jul Aug Sep area for growth in the sector 2011/12 2012/13 Source – Port Statistics
  25. 25. Transportation: Performance Highlights 1H 12/13 1H 11/12 Change  GSA businesses maintained their leadership in the Turnover (Rs. Mn) 465 359 29% market with both passenger and cargo segments PAT (Rs. Mn) 155 102 52% posting healthy earnings  The outbound travel business continued to strengthen its relationships with key corporateRevenue in PAT in Rs. clients and increased its share during 1HRs. Millions Millions800 300  The maritime business benefitted from a higher700 250 throughput at the port. New business was600 generated by servicing casual callers and 200 providing value added services to vessel owners500  “MercMas” – JV with Mercantile Shipping to400 150 provide crew boat services for the transport of300 100 crew, sea marshals and spares in Galle was200 launched in October 2012 50100  “Hemas Logistics” – strategic investment in a haulage company specializing in repositioning - - 2007/08 2008/09 2009/10 2010/11 2011/12 1H containers for shipping lines, expanded services to 2012/13 include car logistics and over dimensional cargo 1H Revenue 1H PAT PAT full year movement
  26. 26. Power
  27. 27. Overview of Power Industry GWh14,000 Annual power generation - GWh12,000 Hemas Power revenue vs10,000 furnace oil prices 8,000 Revenue in Rs. per Rs. Millions liter 6,000 6,000 70 4,000 5,000 60 2,000 50 0 4,000 2004 2005 2006 2007 2008 2009 2010 2011 40 Hydro Thermal Other Renewbles 3,000 30 2,000  Combined installed capacity of power 20 plants in 2011 was 3,141 MW, a growth of 1,000 10 11.5% - 0 2007/08 2008/09 2009/10 2010/11 2011/12  Gross generation for year 2011 was 11,528 GWh, a growth of 7.6% Power revenue Fuel prices *  Average electricity consumption per capita for 2011 was 480 KWh, a growth of 7% *Average annual furnace oil price Source – CEB Statistics 2011 Source – Ceypetco
  28. 28. Power: Performance Highlights 1H 12/13 1H 11/12 Change Turnover (Rs. Mn) 3,140 2,088 50% PAT (Rs. Mn) 116 165 -30%  Sector revenue was mainly driven by growth of our thermal power plant Heladhanavi due to increase in fuel pricesRevenue in PAT in Rs.Rs. Millions Millions  Our hydro power plants recorded a drop6,000 490 in performance due to low rain fall in 4405,000 catchment areas 3904,000 340  Increase in rupee interest rates negatively 290 impacted the bottom line of Heladhanavi3,000 240 190  Rupee devaluation negatively impacted2,000 the net profit through exchange losses on 140 foreign currency borrowings, most of 901,000 which is unrealized 40 - (10) 2007/08 2008/09 2009/10 2010/11 2011/12 1H 2012/13 1H Revenue 1H PAT PAT full year
  29. 29. Sustainability
  30. 30. Community Investment  Hemas’ primary CSR project ‘Piyawara’ celebrated its 10 year partnership with the Ministry of Child Development  At present Hemas has 35 state-of-the-art preschools island wide providing education for over 3,000 children  First ever community preschool in the resettled village of Ambalnagar (10km from Kilinochchi) was opened in July 2012 and the second was opened in Silawathei, Mulativue  Training has been provided for teachers in partnership with the Education Ministry of the Northern Province  Construction is in progress for another community pre-school in Mulativue and a model pre-school for 100 children in the Kilinochchi city
  31. 31. Strategic Focus
  32. 32. Strategic Focus FMCG• Greater focus to win in the Healthcare personal care market Third hospital at Leisure• Investment in identified Thalawathugoda Peace Haven project in high growth categories • Completion: May 2013 Tangalle• Improve sales growth and • Estimated cost: Rs. 1.3Bn • Luxury resort with 150 strengthen Hemas brand rooms acceptance in Bangladesh market • Commencement of construction: FY 13/14 • Estimated cost: $30Mn
  33. 33. Strategic Focus contd.Transportation• Investments and growth plans for Power maritime, aviation and logistics businesses • Focus on renewable energy space; mainly in the small hydro segment in Sri Lanka and East Africa
  34. 34. Hemas Investor Relations: Telephone: +94 11 4 731 731 Email: ir@hemas.com Web: http://www.hemas.com Hemas Holdings PLCHemas House, 75, Braybrooke Place, Colombo 2, Sri Lanka

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