FY2020 Annual Results

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FY2020 Annual Results FY2020 Annual Results Analyst Presentation 30 September 2020 NWSNWS Holdings Holdings Limited Limited © © All All rights rights reserved reserved Brand Story INVESTable ofT FORContents NWS Core Competencies & Financial Summary Section 1 PURPOSE Core Business & Strategic Portfolio Highlight Section 2 Environment, Social & Governance Section 3 Appendices Brand Story Solid & Resilient Business with Visible Prudent Financial Policy Underpinning for CoreINVES T Recovery Prospect Growth & External Shocks No structural change in our resilient Well-managed financial profile & stable & CompetenciesFOR operations/assets manageable gearing at 31% Long term sustainable growth • Agile responses to minimize impact of PURPOSE • Organic – Roads, Insurance, Construction external shock • Opportunistic Acquisition – distressed roads, Quality businesses/assets with strong recurring infra & logistics, insurtech & digitalization cashflow Sustainable & Progressive Dividend Strong Management Track Record with Policy Meaningful Portfolio Restructuring Progress Strong balance sheet able to absorb any Material progress in last 2 years despite shock/uncertainty for shareholders adverse market condition • Maintain absolute DPS despite COVID-19 • BCIA, Bus, Ferry, Ports • Acquired FTLife Insurance, Changliu Expy, Sui-Yue Expy & Suiyuenan Expy 3 Solid & Resilient Business with Visible Recovery Prospect Brand Story Steady & solid performance during COVID-19 Capturing new premium projects in public & INVESNWS T private sector – Kai Tak, Murray Road, etc FORPost- ATL - Strong & steady AOP contribution in FY2020 PURPOSECOVID-19 Well positioned for recovery with incoming MCV Recovery • “Be With You” Personal Accident Plan launched in May & generated strong interests • “On Your Mind” Insurance Plan launched in Sep with a reverse mortgage feature Strong traffic recovery since toll fee resumption • Jun yoy traffic +3% (with acquisition of Changliu Expy) Well positioned for recovery with incoming travellers Water & waste treatment volume • HKCEC – Many events postponed & have recovery after release of COVID-19 a scheduled pipeline once re-open & HK lockdown govt’s pledge of HK$1.02Bn aid for exhibition and convention industry Solar farms in Italy • GHK Hospital – Expanded operational • Continue to see growth in installed capacity (new clinic in Central) capacity Jan Jun HK-China border reopening Jan 2020 2020 Travel restriction lifted 2021 + 4 Brand Story Defensive nature of NWS business INVESRisk T FORManagement PURPOSE Resilient business Quality asset with Risk adverse portfolio mix with fundamentals shown resilient steady AOP well diversified customer base during COVID-19 contribution • Young & narrowbody fleet proven • AOP only down due to • Roads – PRC Govt to be more resilient project milestones not protective measures in • Well diversified customer portfolio from COVID-19 discussion to mitigate 62 lessees in 35 countries COVID-19 impact • Solid financial position & liquidity Strong recurring cash • ATL - Crown jewel asset Unique asset in HK / GBA flow business with in HK / GBA logistics robust outlook • HKCEC – Unique & top MICE venue warehouse in HK, GBA & across Asia Solid demand for • GHK – Strong recovery underway environmental services given reforms in Greater China Resilient AOP / Cash flow Solid & quality asset/business Affected by COVID-19 5 Sustainable & Progressive Dividend Policy Supported by Brand Story Strong Balance Sheet 17 Consecutive Years of Dividend & Counting INVESDividendT Sustainable & Progressive Dividend Policy 50% Payout on Net Profit FORPolicy on Absolute DPS PURPOSE DPS (HK$) • Very high payout in FY2019 & FY2020 • Once business stabilized plenty room for growth 0.72 0.39 0.46 0.34 0.29 0.29 0.31 0.34 0.32 0.29 0.29 FY2016 FY2017 FY2018 FY2019 FY2020 Interim DPS Final DPS Special dividend Unutilized committed Non-core assets disposal Cash on hand banking facilities c.HK$1.7Bn HK$13.2Bn c.HK$14.6Bn 6 NWS Strategic Development Brand Story Disposals of non-core assets INVESStrategicT • BCIA • Tianjin Orient Container Terminals • New World First Ferry (60%) FORRoadmap • Hip Seng Group • Tianjin Five Continents Int’l Container Terminal • NWS Transport Services Ltd (100%) PURPOSE Senior Management addition • Strengthen management team with the appointment of new executive members • More capital market focused in-line with shareholders Business portfolio revamp for growth – New business / asset • FTLife Insurance • Suiyuenan Expy, Sui-Yue Expy & Changliu Expy Re-defining Core Business & Strategic Portfolio Sustainable & Progressive Dividend Policy Jan Jun Jan Jun Jan Jun Jan 2018 2018 2019 2019 2020 2020 2021+ Rejuvenated & agile management to create & unlock value for shareholders 7 Prudent Financial Policy Underpinning for Growth & External Brand Story Shocks (1) INVESFinancialT Well-managed maturity profile allowing financial flexibility for Debt Maturity Profile (as of 30 Jun 2020) operations, potential investments & growth plans FORPolicy 60% Unutilized committed PURPOSE Ample cash on hand banking facilities 33% HK$13.2Bn c.HK$14.6Bn 7% 2nd year 3rd - 5th year after 5th year Current leverage as of 30 Jun 2020 (3) Net Debt(2) Net Gearing Ratio Capital Structure - Debt & Equity HK$MM (%) Equity Debt 17,504 17,734 30% 31% 34% 35% 66% 65% Dec 19 Jun 20 Dec 19 Jun 20 Dec 19 Jun 20 Note: 1. Non-current portion 2. Net debt defined as total debt less cash & bank balances & short-term deposits 8 3. Net gearing ratio defined as net debt divided by total equity 2019 2020 YoY Brand Story For the year ended 30 Jun (HK$MM) (HK$MM) change % 1.7Bn Revenue 26,833.5 25,920.5 (3) Impairment loss includes (1) Attributable Operating Profit (AOP) 4,707.4 3,514.3 (25) but not limited: INVESFinancialT • Tharisa plc Non-operating gains/(losses) 318.8 (1,631.3) • Chongqing Silian FORSummary Optoelectronics Science Profit for the year(2) 4,230.1 835.1 (80) & Tech Co Ltd, • Provision for Free Duty PURPOSE Profit attributable to business to meet obligation under Shareholders of the Company 4,043.2 253.2 (94) committed contract • Provision for Goshawk’s Holders of perpetual capital securities 186.9 581.9 assets impairment & provision on receivables Basic Earnings per share (HK$) 1.04 0.06 (94) • Impairment loss for non-current assets of Dividend per share (HK$) 0.58 0.58 NWS Transport Adjusted EBITDA(3) 5,479.8 4,729.9 (14) 31 Dec 2019 30 Jun 2020 As at (HK$MM) (HK$MM) Total cash & bank balances 12,504.6 13,221.8 Total debt 30,008.6 30,955.7 Net debt position 17,504.0 17,733.9 Net gearing ratio 30% 31% Notes: 1.Attributable operating profit (“AOP”) is defined as profit available for appropriation before corporate office & non-operating items 2.Profit for the year after non-controlling interest 3.Adjusted EBITDA is calculated as gross profit minus general & administrative expenses, & selling & marketing expenses plus depreciation/amortization, dividends received from associated companies & joint ventures & interest income from financial assets at fair value through other comprehensive income (debt instruments) 9 Brand Story AOP by Segment & Geography 1.7Bn INVESFinancialT AOP Contribution by Segment AOP Contribution by Geography FORSummary Core Business Others 12% PURPOSE represents 90% of AOP 8% Hong Kong Mainland 28% FY2019 China 60% 18% 30% 26% 21% 12% 10% -22% Others 12% -3% Roads Aviation Construction Insurance Strategic Mainland China Portfolio Hong Kong FY2020 39% Environment 49% Logistics Transport Facilities Management Strategic Investments 10 Core Business NWSNWS Holdings Holdings Limited Limited © © All All rights rights reserved reserved Core Business Brand Story Expedited recovery Segment AOP RINVESoads T ► Toll fee income for Jun 2020 almost reaching the same level as Dec 2019 HK$MM 15 toll roads in PRC (c. 740km) FOR ► Protective measures for toll fee exemption in discussion with the PRC Govt YoY 1,806 -50% PURPOSE ► Beijing-Zhuhai Expy (GZ-ZH Section) impacted by • traffic diversion of Nansha Bridge 907 Overall traffic volume • prohibition of certain types of large size vehicles using Humen Bridge recovery in Jun 2020 FY2019 FY2020 ► Together with new Toll fee exemption policy contribution from implemented by the PRC Changliu Expy, Govt from 17 Feb to 5 May portfolio +3% yoy 2020 (79 days) & RMB depreciation ► Excl. Beijing-Zhuhai Expy (GZ-ZH Section), the other 3 anchor Outlook expys overall +1% yoy • Strong recovery post-COVID-19, underlying traffic remains solid • Capitalize on distressed opportunities & continue to enrich our roads portfolio in China (esp. Central China & GBA) Notes: 1. 4 anchor expys: Hangzhou Ring Road (100%), Tangjin Expy (TJ North Section) (60%), Guangzhou City Northern Ring Road (65.29%), Beijing-Zhuhai Expy (GZ-ZH Section) (25%) 12 12 Perp? Core Business Brand Story Sound financial position to defy headwinds Segment AOP AviationINVEST ► Solid financial position & ample liquidity to weather crisis HK$MM Goshawk ► Rent deferrals granted to 9 customers (24 aircraft); aggregate rent AircraftFOR leasing & management YoY represented 1% of Goshawk’s annual revenue -16% PURPOSE ► Unfavourable interest rate swap contracts mark-to-market accounting loss 500 422 Well positioned to HK$146MM (FY2019: HK$158MM) weather the COVID-19 ► Collection rate from airline customers during 1H 2020 was 78% FY2019 FY2020 ► US$1.4Bn liquidity available Aircraft Leasing Portfolio Excl. BCIA dividend income recognized in FY2019 & (1) Fleet size 233 aircraft (incl. 40 direct orders) reduced aircraft trading ► Young & well- Portfolio
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