aboitiz equity ventures - s3-ap-southeast-1.amazonaws.com · unit 1 (130mw): cod –sept. 18, 2015...

Aboitiz Equity Ventures

Fourth Quarter / Full Year 2015Financial & Operating Results

9 March 2016

2

AGENDA

• Review of Business Units

• AboitizPower

• UnionBank

• Pilmico

• AboitizLand

• Republic Cement and Building Materials

• AEV Financials

• Q&A

3

AGENDA

• Review of Business Units

• AboitizPower

• UnionBank

• Pilmico

• AboitizLand

• Republic Cement and Building Materials

• AEV Financials

• Q&A

4

812 916 906 1,171721

3,5732,844 3,064

4,433

2,700

1Q2015 2Q2015 3Q2015 4Q2015 4Q2014

QUARTERLY BREAKDOWN

3,203 3,806

13,47613,915

FY2014 FY2015

17,604EPS = P2.39

5%

+3%

+19%

16,705EPS = P2.27

DistributionGeneration AP Parent & Others

3,5033,683

4,347

54%30%

4,164

5,410

FINANCIAL HIGHLIGHTS

Net income up on higher generation and distribution earnings

NET INCOME (in Php million)

812 916 906 1,171721

3,5613,021

3,828

4,402

2,619

1Q2015 2Q2015 3Q2015 4Q2015 4Q2014

QUARTERLY BREAKDOWN

5

DistributionGeneration AP Parent & Others

3,4293,837

4,335

56%11%

Non-Recurring ItemsFY2014 FY2015 1Q2015 2Q2015 3Q2015 4Q2015 4Q2014

AP Parent 24 135 (1) 22 101 12 (8)

AP -Gen (160) (897) 13 (176) (764) 31 81

Total Gains/(Losses) (136) (762) 11 (154) (663) 43 73

4,827

3,203 3,806

13,63614,812

FY2014 FY2015

18,366EPS = P2.509%

+9%

+19%

16,841EPS = P2.29

5,367

Core net income up on higher sales from the Coal and Large Hydro Units

FINANCIAL HIGHLIGHTS

CORE NET INCOME (in Php million)

6

1,265 1,411 1,438 1,343 1,308

7,2396,129

7,3918,688

5,766

1Q2015 2Q2015 3Q2015 4Q2015 4Q2014

QUARTERLY BREAKDOWN

5,480 5,457

27,04129,447

FY2014 FY2015

35,1768%

+9%

-0.4%

32,615

DistributionGeneration AP Parent & Others

7,2477,571

8,531

38%10%

9,094

9,980

FINANCIAL HIGHLIGHTS

BENEFICIAL EBITDA (in Php million)

Cash generation continued to be strong

7

FINANCIAL CONDITION

BALANCE SHEET

(In million Pesos)

Cash and Equivalents

YE2014

Total Assets

Total Interest Bearing Debt

Total Liabilities

Net Debt

Total Equity

Current Ratio

Net Debt to Equity

20,161

91,367

9,902

22,385

-

68,982

1.7x

-0.1x

Investments and Advances 70,012

YE2015

13,841

85,574

9,911

22,613

-

62,962

1.2x

-0.1x

70,373

PARENT

YE2014

40,232

216,761

97,347

120,681

57,115

96,080

3.4x

0.6x

24,816

YE2015

51,098

242,562

114,152

140,948

63,054

101,613

3.1x

0.6x

22,552

CONSOLIDATED

Year-end balance sheet continued to be strong with low gearing

8

184 133

557 613

935 980

123 173

FY2014 FY2015

Capacity Sales Breakdown by Profile (MW)

Spot Market Energy Contracts

Capacity Contracts Ancillary

1,9001,800 6%

Capacity Sold Factor

Fuel Group FY14 FY15Change in % points

MINI HYDRO 49% 44% -5

LARGE HYDRO 64% 78% 14

SNAP Magat 54% 60% 6

SNAP Benguet 79% 100% 21

GEOTHERMAL 79% 75% -4

COAL 93% 97% 4

Therma Luzon 93% 93% -

Therma South 100% -

OIL 95% 97% 2

83% 85%CapacitySold Factor

OPERATING HIGHLIGHTS: GENERATION

Capacity sales growth driven by increase in available capacities

9

Fuel GroupBeneficial

Total Energy Sales(GWh)

BeneficialAncillary Sales

(GWh)

FY14 FY15 YoY Chg FY14 FY15 YoY Chg

MINI HYDRO 690 686 -1%

LARGE HYDRO 799 790 -1% 853 1,221 43%

SNAP Magat 377 381 1% 473 572 21%

SNAP Benguet 422 409 -3% 380 650 71%

GEOTHERMAL 2,772 2,643 -5%

COAL 5,510 6,580 19%

Therma Luzon 4,706 5,124 9% 224 298 33%

Therma South - 436 -

OIL 1,504 1,854 23%

AP – GENERATION 11,272 12,550 11% 1,077 1,519 41%

OPERATING HIGHLIGHTS: GENERATION

Volume Sales growth driven by the Coal, Large Hydro and Oil Groups

10

OPERATING HIGHLIGHTS: GENERATION

MAGAT’S WATER LEVEL VS. RULE CURVE (in MASL)

1Q 2Q 4Q3Q

Dry Spell to persist until mid-2016

11

OPERATING HIGHLIGHTS: GENERATION

In Peso/kWhBilateral

ContractsSpot Market

Weighted Average

Ancillary

FY14 FY15 FY14 FY15 FY14 FY15 FY14 FY15

AP GENERATION GROUP 4.93 3.64 5.05 4.41 4.94 3.70 2.22 2.04

SNAP Magat 4.68 5.07 5.50 3.56 5.01 4.83 2.10 2.22

SNAP Benguet 4.65 4.71 6.99 5.13 5.47 4.75 2.73 2.05

Therma Luzon* 4.04 3.80 5.14 5.03 4.19 3.90 1.64 1.66

Therma South - 4.00 - - - 4.00

APRI** 4.65 4.16 4.04 3.69 4.52 4.05

Note: Fuel cost and purchased power:*TLI: P1.39/kWh (FY2015) versus P1.91/kWh (FY2014)**APRI: P1.53/kWh (FY2015) versus P1.88/kWh (FY2014)

Average selling price continued to drop

344

459

24

106 96

22 28 22

1,102

354

475

26 102 102

22 30 26

1,138

DavaoLight

VECO CotabatoLight

SFELAPCO SEZ MEZ BEZ LEZ Total

FY2014 FY2015

12

OPERATING HIGHLIGHTS: DISTRIBUTION

1,117

3,363

4,480

1,186

3,573

4,759

Residential Commercial &Industrial

Total Power Sales

FY2014 FY2015

BENEFICIAL POWER SALES (Gwhr)

BENEFICIAL GWH SALES GROWTH(BY CUSTOMER TYPE)

PEAK DEMAND (MW)

3%

2,790 3,142 3,322 3,606 3,727 3,934 4,076 4,480 4,759

2007 2008 2009 2010 2011 2012 2013 2014 2015

6%

6%

6%

6%

Power sales grew across all customer segments

Gov’t Cap – 8.50%

13

OPERATING HIGHLIGHTS: DISTRIBUTION

2%

1% 1%

4%

6% 6%

8%8%

1%1% 1%

3%

5%

7%8%

5%

SYSTEMS LOSSGROSS MARGIN / KWH SALE

SFELAPCOSEZ Davao Light VECO CotabatoLight

MEZ BEZ

1.25

1.44

1.60

1.77 1.71

1.61

2010 2011 2012 2013 2014 2015

FY2014

FY2015

LEZ

Gross margin dropped due to Davao Light’s higher cost

14

PROJECT UPDATES

Therma South – Davao Coal

Unit 1 (130MW): COD – Sept. 18, 2015 Unit 2 (130MW): COD – Feb. 2, 2016

Source: Official Gazette of the Republic of the Philippines

Therma South coal-fired power plant fully operational

Ph

ilip

pin

es

Projects under-construction Capacity Start of Construction Estimated Completion

San Carlos - Negros (Solar) 59 MWp 2H2015 1Q2016

Pagbilao 3 (Coal) 400 MW 2H2014 2H2017

Manolo Fortich (Hydro) 68 MW 1H2015 2H2017

MARIS Canal (Hydro) 8.5 MW 2H2015 2H2017

Cebu (Coal) 300 MW 1H2015 2H2018

Exploratory Projects Estimated Capacity Partner/s Location

Mini Hydro ~200 MW - Across the Philippines

Large Hydro 390 MW - Luzon

Geothermal - - Luzon & Mindanao

Inte

rnat

ion

al

Hydro 127 MWSN Power & Energi

InfranusantaraCentral Sulawesi, Indonesia

Geothermal 110 MW Medco Power East Java Province, Indonesia

15

PROJECT UPDATES

Healthy pipeline in place to reach our target of ~4,000 MW by 2020

16

AGENDA

• Review of Business Units

• AboitizPower

• UnionBank

• Pilmico

• AboitizLand

• Republic Cement and Building Materials

• AEV Financials

• Q&A

17

Net Income dropped notwithstanding substantial growth in customer business

2,409 2,345

8,401

6,008

4Q2014 4Q2015 2014 2015

Attributable to Parent Bank’s Stockholders

28%

3%

NET INCOME(in Php million)

FINANCIAL HIGHLIGHTS

18

Net interest income grew on the back of improved margins & loan expansion

10,784 12,151

2014 2015

13%

NET INTEREST INCOME(in Php million)

232 187

113 147

14 5

90.4% 89.2%

-10.0%

10.0%

30.0%

50.0%

70.0%

90.0%

110.0%

-

100

200

300

400

500

YTD 2014 YTD 2015

EARNING ASSETSADB In Billions

Liquid Assets Loans Others Share to Net Assets

4.33% 4.88%

1.19% 1.24%

3.13% 3.64%

YTD 2014 YTD 2015

NET INTEREST MARGIN

Ave. Yield Ave. Cost Net Interest Margin

359 339

51bps

6%

+30%

-19%

YTD 2014 YTD 2015

FINANCIAL HIGHLIGHTS

19

Credit portfolio expand supported by sustained growth in retail and corporate lending

61.6 69.0 55.7

68.6

24.2 28.1

23.9 26.0

41.8

68.6

45.1

57.9

4Q2014 4Q2015 2014 2015

Retail Commercial Corporate

22%

+23%

124.7

+9%

152.5

+28%

127.6

165.8

30%

+12%

+16%

+64%

CREDIT PORTFOLIO(ADB in Php billion)

FINANCIAL HIGHLIGHTS

20

Non-interest income weighed down by trading gains

801 960

3,270 3,692 905 181

3,422

155

977 1,496

2,200

2,351

4Q2014 4Q2015 2014 2015

Ser. Charges, Fees and Com. Trading and FX Gain-net Miscellaneous

6,198

8,892

30%

+7%

-95%

+13%

2,6372,683

2%

+20%

+53%

-80%

NON-INTEREST INCOME(in Php million)

FINANCIAL HIGHLIGHTS

21

Total expenses rose on branch expansion

OPERATING EXPENSES(in Php million)

2,039 2,209

7,670 8,155

250 320

1,047 934

144 170

410 433

4Q2014 4Q2015 2014 2015

Core Bank Taxes (GRT & DST) Subsidiaries

2,433

+8%

-11%

2,700

9,1279,522

4%

11% +28%+18%

+6%

+6%

FINANCIAL HIGHLIGHTS

262 254 284 243

31 42 28 40

4Q2014 4Q2015 2014 2015

TOTAL DEPOSITSADB In Billions

UnionBank Subsidiaries

22

CASA deposits continued to post double-digit growth

94

312 283

106

293 296

95 11283 97 81 92

11 13

11 12

32.6% 39.7%30.2% 37.6%

-50.0%

-40.0%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

-

20

40

60

80

100

120

140

160

180

4Q2014 4Q2015 2014 2015

CASA DEPOSITSADB In Billions

Peso FCDU Subsidiaries Share of CASA to Total

13%

+9%

+14%

18%

+18%

+17%

+43%

9%

-14%

+35%

-3%

1%

9410695 112

FINANCIAL HIGHLIGHTS

23

Capital ratios remained healthy and above regulatory limits

14.0%13.0%

17.6%

16.2%

2014 2015

Tier 1 Capital Ratio Total Capital Adequacy Ratio

FINANCIAL HIGHLIGHTS

24

Key ratios fell in view of lower trading gains

18.7%

10.8%

2014 2015

Return on Equity

2.1%

1.6%

2014 2015

Return on Ave. Assets

46%52%

2014 2015

Cost to Income

FINANCIAL HIGHLIGHTS

25

UnionBank shares trailing behind PSE and Financial indices

60%

70%

80%

90%

100%

110%

120%

REBASED STOCK PERFORMANCE12/31/2014-12/31/2015

UnionBank PSEi Financial Index

26

AGENDA

• Review of Business Units

• AboitizPower

• UnionBank

• Pilmico

• AboitizLand

• Republic Cement and Building Materials

• AEV Financials

• Q&A

2,080 1,783 1,869 1,820 2,255

2,207 2,470 2,577 2,642 2,329

891 995 847 801 1,136

451 509 385 442

565

1Q2015 2Q2015 3Q2015 4Q2015 4Q2014

8,134 7,553

8,296 9,896

1,656

3,534 1,934

1,786

FY2014 FY2015

27

FINANCIAL HIGHLIGHTS

Feeds PhilippinesFlour FarmsFeeds Vietnam

QUARTERLY BREAKDOWN

5,629 5,757

9%

5,706

22,768

14%20,020 5,678

6,285

REVENUE(in Php million)

306 306 294

105 157

238 286

407

448

230

56 70

34

10

11

124

147

117

98

206

1Q2015 2Q2015 3Q2015 4Q2015 4Q2014

927 1,011

662

1,378 45

170

677

484

FY2014 FY2015

28

FINANCIAL HIGHLIGHTS

Feeds PhilippinesFlour FarmsFeeds Vietnam

QUARTERLY BREAKDOWN

724

808

9%661

3,04332%

2,311

851

604

EBITDA (in Php million)

178 178 169

29 91

146 175 253

276 129

35 41

18

(9) (10)

60

71 48

41

130

1Q2015 2Q2015 3Q2015 4Q2015 4Q2014

504 556

411

849 16

85

376

220

FY2014 FY2015

29

FINANCIAL HIGHLIGHTS

Feeds PhilippinesFlour FarmsFeeds Vietnam

QUARTERLY BREAKDOWN

419

466

5%

377

1,710

31%

1,307

488

340

NET INCOME(in Php million)

226,933 239,408

2,775

FY2014 FY2015

Export Domestic

30

OPERATING HIGHLIGHTS – Flour Division

7%

Sales VolumeIn MT

Average Selling Prices and

Gross ProfitPeso/bag

Average Selling Price Gross Profit

242,183

896

780

124 126

FY 2014 FY 2015

318,514 380,652

76,219

173,073

FY 2014 FY 2015

394,734

553,725

31

OPERATING HIGHLIGHTS – Feeds Division

40%

Sales VolumeIn MT

Average Selling Prices and

Income Over Ingredient Cost

Peso/MT

Average Selling Price

Income Over Ingredient Cost

Volume: Philippines Volume: Vietnam

Feeds Philippines

Average Selling Price

Income Over Ingredient Cost

Feeds Vietnam

23,163 22,692

4,826 5,662

FY 2014 FY 2015

21,534 20,417

2,024 2,476

Ave. 2014 FY 2015

15,789 15,320

8,572

10,121

-

2,000

4,000

6,000

8,000

10,000

12,000

FY 2014 FY 2015

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

FY 2014 FY 2015

Sales Volume ('000 Kilos) Ave Sow Level (heads)

32

OPERATING HIGHLIGHTS – Farms Division

4%Sales VolumeIn ‘000 kilos

Average Selling Prices and

Gross Profit

Peso/kilo

Average Selling Price Gross Profit

116 112

35 29

FY 2014 FY 2015

33

PROJECT UPDATES

April 2016*

ILIGANAnimal Feeds

+20 TPH

TARLACAnimal Feeds

+20 TPH

VIETNAMAqua Feeds

+20 TPH

87%complete**

79%complete**

93%complete**

April 2016* May 2016*

PROJECT UPDATES - FEEDS

**Status as of March 2016*Target completion month

34

September 2016*

BREEDERFarm 2

LAYERFarm 1 of 4

NURSERYFarm 2

50%complete**

`

100%complete**

64%complete**

July 2016*January 2016*

PROJECT UPDATES - FARMS

**Status as of March 2016*Target completion month

35

May 2016

GROWFINFarm 7

GROWFINFarm 8

91%complete**

c

May 2015

100%complete**

PROJECT UPDATES - FARMS

**Status as of March 2016*Target completion month

36

37

AGENDA

• Review of Business Units

• AboitizPower

• UnionBank

• Pilmico

• AboitizLand

• Republic Cement and Building Materials

• AEV Financials

• Q&A

Revenues stay close to 3B levelIndustrial sales continue to bring in biggest contribution

1,315 1,137

1,3621,371

98120

2014 2015

Residential Industrial Commercial & Others

REVENUES(in Php million)

2,7742,6295%

FINANCIAL HIGHLIGHTS

38

Sweeping residential sales growth

driven by more than double house & lot product sales

665280

621 1,377

497

260

2014 2015

RESIDENTIAL SALES(in Php million)

Lots H&L Condo

1,783 8%

FINANCIAL HIGHLIGHTS

1,917

39

558 536

75

2014 2015

656 614

88

2014 2015

NIAT sustained at P500M level

17%

FINANCIAL HIGHLIGHTS

15%

EBITDA(in Php million)

NIAT(in Php million)

744 633

RE Business LUC Contribution

40

Residential

Launched Amoa, a 50-hectare property in Northern Cebu catering to the mid-market, which exceeded sales target 3x

Launched new inventories in Priveya Hills, a high-end development

Commercial

Doubled capacity of The Outlets by opening expansion area

Brought in more shopping options with established brands, e.g. Oakley, Onitsuka Tiger, Skechers, Asics and Bench Depot

Launched The Fork in the Road, The Outlets’ newest culinary strip

Industrial

Consistently exceeded sales target in the last two years, driven by Lima Land

OPERATING HIGHLIGHTS

41

PROJECT UPDATES

Growth plans on track

Residential

On-target for entry into the national scene

Intensify land banking efforts in provincial growth areas.

Target to acquire 80 hectares in 2016

Industrial

Capture growing industrial demand

Target to sell 20 hectares in 2016

Fill up Lima Land and continue to build on land bank to cater to more world-class industries

Target to acquire additional 25 hectares in 2016

CDPEI (JV with AyalaLand)

Launch of estate and groundbreaking of commercial block by first half of 2016

42

2015 CAPEX spent at 1.7B

Land AcquisitionProject DevelopmentOther Initiatives

2016 CAPEX targeted at 4.6B

29%

65%

6%

46%

39%

15%

PROJECT UPDATES

Growth plans on track

43

44

AGENDA

• Review of Business Units

• AboitizPower

• UnionBank

• Pilmico

• AboitizLand

• Republic Cement and Building Materials

• AEV Financials

• Q&A

45

RCBM

Presence Across the Archipelago

Visayas

Luzon

Mindanao

Cebu

Davao

Manila

Bulacan

Norzagaray

Teresa

Batangas

Iligan

Danao Grinding Station

RCBM Batangas Cement Plant

Competitively positioned

• Engaged in the manufacture, development, exploitation and sale of cement, marble and all other kinds and classes of building materials

• Production capacity of 6.5 million metric tons per year

.

New business unit holds no. 2 position in the market

• Robust growth in volumes and prices driven by favorable trends in construction activity and reduced input costs

• Four-month earnings attributable to AEV amounts to Php194mn

• RCBM to benefit from good growth in the Philippines driven by residential and infrastructure demand

• There is need to invest capacity in the Philippines

46

RCBM OPERATING HIGHLIGHTS

2016 Outlook

2015 Highlights

47

PROJECT UPDATES

AEV + SMRT Int’l Pte. Ltd =

Aboitiz-SMRT Transport Solutions Consortium

Bid Submission: Apr. 4, 2016

LRT 2 & Masinag Extension*

Trident Infrastructure

Laguna Lakeshore Project

AEV + Megaworld + AyalaLand + SM Prime =

P122.8 bn – 47 km

Bid Submission: Mar. 14, 2016

Regional Bundled Airports

AEV + VINCI Airports =Maya Consortium

Bid Submission: Mar. 28, 2016

P108.2 bn – 5 airports

*O&M

AEV Business Development – PPP Projects of Interest

48

AGENDA

• Review of Business Units

• AboitizPower

• UnionBank

• Pilmico

• AboitizLand

• Republic Cement and Building Materials

• AEV Financials

• Q&A

49

FINANCIAL HIGHLIGHTS

FY2014 FY2015 % Ch

Revenues 109,867 116,349 6%

Equity Earnings 7,244 6,589 -9%

EBITDA 38,356 40,144 5%

Net Income 18,381 17,679 -4%

Core Net Income 17,945 18,281 2%

CONSOLIDATED PROFIT & LOSS(in Php million)

Maintained strong financial performance

12,747 13,534

3,244 2,542

1,307 1,710 633

536 450

(835)

FY2014 FY2015

3,342 2,832

3,201

4,159

2,685

382

485

572

1,103

872

416 469

488

337

365

80

133

36

287

68

22

171

(134) (183) (242) (276)

1Q2015 2Q2015 3Q2015 4Q2015 4Q2014

QUARTERLY BREAKDOWN

50

17,679EPS = P3.184%

18,381EPS = P3.32

4,0863,735

42% 40%

5,780

Power Financial Services Food Parent & OthersReal Estate Infrastructure

4,0784,125

FINANCIAL HIGHLIGHTS

NET INCOME(in Php million)

Power still accounted for bulk of earnings; fresh contribution from cement

3,333 2,951

3,712 4,128

2,686

382 485

572

1,103

872

416 469

488

337

365

80 133

36

287

68

22

171

(134) (183) (238) (265)

78

1Q2015 2Q2015 3Q2015 4Q2015 4Q2014

12,940 14,120

3,244 2,542

1,307 1,710 633 536

(179)(820)

FY2014 FY2015

51

18,281EPS = P3.292%17,945

EPS = 3.24

QUARTERLY BREAKDOWN

4,0773,854

25% 42%

5,759

4,591

Power Financial Services Food Parent & OthersReal Estate Infrastructure

Non-Recurring ItemsFY2014 FY2015 1Q2015 2Q2015 3Q2015 4Q2015 4Q2014

Parent 629 (15) (0.3) (0.4) (4.0) (11.4) (0.4)Power (193) (586) 9 (118) (510) 33 56 Total Gains/(Losses) 436 (601) 9 (119) (514) 22 56

FINANCIAL HIGHLIGHTS

CORE NET INCOME (in Php million)

4,069

Netting out unrealized forex losses, core net income increased

38,356

32,744

40,144

35,402

EBITDA (Consolidated) EBITDA (Beneficial)

52

FY2014 FY2015

5%

8%

FINANCIAL HIGHLIGHTS

EBITDA(in Php million)

EBITDA increased on fresh contribution from new units

9,188

32,000

YE2014 YE2015

4,395

7,056

YE2014 YE2015

53

Parent net debt increased by P20bn

Cash & Equivalents

Long-term Debt

61%

248%4,793

24,944

YE2014 YE2015

FINANCIAL HIGHLIGHTS

54

YE2014 YE2015 % Change

Cash and Cash Equivalents 50,482 63,581 26%

Total Assets 280,997 340,140 21%

Total Liabilities 146,062 193,225 32%

Total Equity 134,935 146,914 9%

Equity Attributable to Parent 107,944 118,179 9%

Book Value Per Share 19.49 21.28

Current Ratio 2.76x 2.83x

Debt to Equity 1.08x 1.32x

Net Debt to Equity 0.50x 0.66x

FINANCIAL HIGHLIGHTS

CONSOLIDATED BALANCE SHEET/KEY RATIOS(in Php million, except ratios)

Gearing remained benign

55

YE2014 YE2015 % Ch

AboitizPower 12,747 13,534 6%

UnionBank 3,244 2,534 -22%

Petnet - 8

Pilmico 1,307 1,710 31%

AboitizLand 633 536 -15%

Republic Cement - 194

Parent & Others 450 (835) -286%

Net Income 18,381 17,679 -4%

Core Net Income 17,945 18,281 2%

FINANCIAL HIGHLIGHTS

Fresh income contribution from new businesses

EARNINGS CONTRIBUTION(in Php million)

56

AGENDA

• Review of Business Units

• AboitizPower

• UnionBank

• Pilmico

• AboitizLand

• Republic Cement and Building Materials

• AEV Financials

• Q&A

Is there a better way?

57