eastern water resources development and management plc....

Eastern Water Resources Developmentand Management PLC. Jan-Mar 2009 Results

ContentsContents

Company OverviewCompany Overview

Operation HighlightsOperation Highlights

Financial HighlightsFinancial Highlights

Future InvestmentsFuture Investments

2

Highlights

10.56 % of Net Income and 18.56 % of EBITDA increase (Q1/2009, YoY)

Average Tariff increases by 16.71% (Q1/2009, YoY) given tariff reduction to

PWA, according to the resolution of AGM/2008(Oct-Dec 08) as of 30 April,2009

Increasing potential of Nongplalai to Maptaphut(Line3) pipeline with financing

secured by GSB

Tap water business expand to Chonburi and Samui which expect to increase

revenue by approx .14%

3

East Water Group StructureEast Water

Tap Water Related Business

Universal Utilities : 100%* THB 510 million

Water Trades and Services : 100%*THB 5 million











Bangpakong Water Supply

Chachoengsao Water Supply

Nakornsawan Water Supply

Bangpakong Water Supply

Chachoengsao Water Supply


Bangpakong Water Supply Co.,Ltd.

Chachoengsao Water Supply Co.,Ltd.

Nakornsawan Water Supply Co Ltd

Contract to service drinking vending machine


Rayong Waterworks


Rayong Waterworks

Nakornsawan Water Supply Co.,Ltd.

Rayong Waterworks

Chonburi Waterworks

Operations & Maintenance

Non Revenue Water

East Water Sattahip, Borwin Waterworks

Ratchaburi –SamutSonghram, Phuket

PWA 3 project : Omnoi, PathumThani, PattayaNon Revenue Water

East Water

Non-Revenue Water

East Water

EGCOM TARA : 15%* THB 345 million4

East Water

Koh Sichang, Lan, Samui Waterworks

p,East WaterEast Water

Shareholders Structure

PWA40.20%

Institutions17.89%

Retail Investors

8.48%

Retail Investors & Institutions 26.37%

IEAT

Utilico 10.14%

IEAT4.57%EGCOMP

18.72%

Paid-up Capital = THB ~1,663.72 Million

As of 10 April 2009

Note: *PWA : Provincial Waterworks Authority, a state enterprise responsible for waterworks outside BKK

*IEAT : Industrial Estate Authority of Thailand, a state enterprise responsible for establishment industrial estates

*EGCOMP : A public company limited, produce and supply electricity in Thailand

*Utilico : Utilico Emerging Markets Limited, an investment company from UK5

ContentsContents




F t I t tFuture Investments

6

Bangpakong River

Reserve Pool 2 Mcm.• Due to the higher pace of industrial growth, the Company operates majorly in three provinces : pChonburi, Rayong and Chachoengsao. East Water’s pipelines network ranging from diameter 500 – 1500

ChacheongsaoIV

ชลบรุี

Reserve Pool 7.5 Mcm.Siam Water Resource 10 Mcm.

from diameter 500 1500 mm. and 324 km. in length linking as the water grid line in Eastern Seaboard

NongKhoBangPra

KlongYaiPrasae

Puakdang-BorwinII

ChonburiIIIBangkok

D kK i

KlongYaiNongPlaLai

-

DokKrai

Existing Pipe NetworkConstructing Pipe Network

RayongI

ระยอง

Source of Raw Water, Pipelines Network and Service Areas Source of Raw Water, Pipelines Network and Service Areas 7

NetworkService Area

Raw Water Demand

271Million Cubic Meter

300 201 219 224 214

233 255 271 Million Cubic Meter

200

250 191 201 219 224 214

100

150

50

100 Demand is expected to increase by the expansion of Domestic Consumption

and Petrochemical Phase 3

-2005 A 2006 A 2007 A 2008 A 2009 E 2010 E 2011 E 2012 E

Forecasted

2005 A 2006 A 2007 A 2008 A 2009 E 2010 E 2011 E 2012 E8 * All the figures above were adjusted to the new fiscal year(1 Jan – 31 Dec)

BangpakongBangpakongRiverRiver

ChacoengsaoChacoengsao ReservoirReservoir

ชลบุรีชลบุรี

สระสํารองนํ้าดบิสํานักบกสระสํารองนํ้าดบิสํานักบกChachoengsao Pipeline Networks

อ่างฯหนองค้ออ่างฯหนองค้อ

อ่างฯบางพระอ่างฯบางพระ Bangpakong-Chonburi Pipeline Networks

อ่างฯคลองใหญ่อ่างฯคลองใหญ่

Chonburi Pipeline Networks

อ่างฯประแสร์อ่างฯประแสร์

อ่างฯหนองปลาไหลอ่างฯหนองปลาไหล

อ่างฯ ดอกกรายอ่างฯ ดอกกราย

Rayong Pipeline NetworksRayong Pipeline Networks

ระยองระยอง

9

BangpakongBangpakongRiverRiver

ChacoengsaoChacoengsao ReservoirReservoir

Prospect CustomersProspect CustomersProspect CustomersProspect CustomersAverage Demand of Raw Water

expected to increase 75 000 m3 per day

Bangpakong Chonburi Pipeline Networks

ชลบุรีชลบุรี

สระสํารองนํ้าดบิสํานักบกสระสํารองนํ้าดบิสํานักบกChachoengsao Pipeline Networks

expected to increase 75,000 m3 per day

อ่างฯหนองค้ออ่างฯหนองค้อ

อ่างฯบางพระอ่างฯบางพระ

Bangpakong-Chonburi Pipeline Networks

อ่างฯคลองใหญ่อ่างฯคลองใหญ่

Chonburi Pipeline Networks

อ่างฯประแสร์อ่างฯประแสร์

อ่างฯหนองปลาไหลอ่างฯหนองปลาไหล

อ่างฯ ดอกกรายอ่างฯ ดอกกราย

Rayong Pipeline NetworksRayong Pipeline Networks

ระยองระยอง

10

140Chonburi

Rayong

Reservoir Storage as of 25 May, 2009

80

100

120

140

50

60

70

80

21

24 120

140

160

180

250

275

35

40

45

Rayong117

21.4 64.1

71.4

124.6

163

40.1248

20

40

60

80

36% 10

20

30

40

50

6

9

12

15

18

21

40

60

80

100

60%150

175

200

225

10

15

20

25

30

35

42.5 12.8

28.8165.6

0

อา่งฯบางพระ

36%

0

10

อา่งฯดอกกราย

0

3

อ่างฯหนองคอ้ 0

20

อา่งฯหนองปลาไหล

76%60% 90%

50

75

100

1250

5

อา่งฯคลองใหญ่

72%

Bangphra Nongkoh Dokkrai Nongplalai Khlong yai

0

25

อา่งฯประแสร์

67%

Phrasae

Existing Pipe Network Potential Pipe Network11

2009 (Forecast)

12

RID Water ResourceFuture Source of Raw Water Supply

Development Project

1. Klong Phra-ong-chao. –

Bangpra Pipeline : 70 mcm.1

2. Prasae - Klongyai Pipeline

: 80 mcm.

3. Klong Wang-Ta-Node-

2Prasae Pipeline : 70 mcm.

3

4. Stungnum-Trad-Chantaburig

-Rayong Pipeline : 700 mcm.

4

Existing Pipe NetworkConstructing Pipe Network14

Laying pipeline from Nongplalai to Maptaphut

NongPlaLai-Dokkrai- Maptaphut Line 3BangPra Laying pipeline from Nongplalai to Maptaphut

area diameter 1,400 mm. approx. 35 km.

Increasingly potential pipeline to be supported water demand in 10 years

NongKho

BangPra

water demand in 10 years

Total investment 1,730 MB

Project Period 2009 2011Project Period 2009-2011

KlongYaiPrasae

PPrasae-Klongyai (RID)

NongPlaLai

DokKrai

g

Laying pipeline approx. 35 km.

Maptaphut Industrial Estate

15

Prasae-Klongyai Pipeline Linkage Project

Prasae-Klongyai connecting pipeline project

KlongYai Prasae

Appointed in Aug 2005 by thePipeline linkage

Appointed in Aug 2005, by the Cabinet, as the General Contractor for the 31.8 km. Prasae-Klongyai Pipeline project(1,680MB) to supply water to

Pumping station

MTP

98.5% constructions progress achieved only system commissioning

NongPlaLaiachieved, only system commissioning outstanding

RID asked for the Budget Allocation b ill i

Constructing Pipe Network

Pumping station

but still in process

Pumping station

16

Alternative Source of Raw Water Supply

Water ResourcesDevelopment by EW

1 Private Water Reservoir :

60-80 mcm.

2 Off-stream Reservoir : 30

mcm.

3 Water Reverse Osmosis :

10,000 m3 per day

Existing Pipe NetworkConstructing Pipe Network17

Revision of Tariff Structure for 2008-2012

Unit: Baht/m3

Type of Customers Tariff In 2008

Tariff In 2009

Tariff In 2010

Tariff In 2011- 2012

1. PWA & Domestic Consumption: Residential and Bureaucratic

8.5 7.90* 7.90*

To be reconsidered in accordance with cost

and economic

PWA & Domestic Consumption: Commercial customers

8.5 9.25* 9.25*

2 IEAT d i ti 8 5 9 25 9 25 and economic condition in the future

2. IEAT and existing user 8.5 9.25 9.25

3. Private Industrial Estate 9.5 10.25 10.25

4. General & Other Factory 10.5 11.25 11.25

18 * According to the resolution of AGM / 2008(Oct-Dec 08), approval 7.90 Baht/m3 come down for residential and bureaucratic consumer which approx. 40%, the rest of 60% still maintain at normal rate 9.25 Baht/m3 of Domestic Consumption type of customers during 2009-2010

ContentsContents

Company Overviewy

Operation Highlightsp g g

Financial Highlightsg g

Future Investments

19

Source of Revenue

Quarterly Source of Revenue ComparisonEast Water Group Source of Revenue

3,000

800Million Baht

Million Baht

2 502

Quarterly Source of Revenue Comparisonp

2,000

2,500

60010%3%

2,417

8%1%

2,5021%

3%698

613

2%1%

22%

10%2%

13.91%

1,500

,

400

Other Income

Pipes

Drinking Water

20%22% 3%

22%

22%

1,000

0

200 Services Income

Tap Water

Raw Water698 66%72%

10%2%

-

500 0

Jan-Mar 08 Jan-Mar 0966% 69% 66%22%10%

2007 2008 Jan-Mar 09

20 * All the figures above were adjusted to the new fiscal year(1 Jan – 31 Dec)

Raw Water Volume and Sales

Consolidated Performance Consolidated Performance

300 Million Cubic Meter

2,000

Million Baht

219 224250 1,588 1,658

1,500

150

200

1,000

6054

100 440 459 500 54

-

50

-

10.51%YoY

4.44%YoY

2007 2008 Jan-Mar 09 2007 2008 Jan-Mar 09


Tap Water Volume and Sales

Consolidated Performance Consolidated Performance

60

Million Cubic Meter

700

Million Baht

454950 541

500

600

30

40 488 400

12 1320

135 150 200

300

-

10

-

100 7.51%YoY

11.71%YoY

2007 2008 Jan-Mar 09 2007 2008 Jan-Mar 09


Raw Water Revenue and Costs Breakdown

COGS of Raw Water Breakdown (Consolidated F/S)

1 658

Revenue & COGS of Raw Water (Consolidated F/S)

1,5881,658

17%13%19%

14%Raw Water

459Milli

on B

aht 4%

30%

2%

29%

Labour

Electricity

Jan-Mar 08

459M

36%

36%

29%

Depreciation43%

35%40%

2007 2008 Jan-Mar 09

COGS R

Others

Jan-Mar 09

COGS Rev


Tap Water Revenue and Costs Breakdown

COGS of Tap Water Breakdown (Consolidated F/S)

560

Revenue & COGS of Tap Water (Consolidated F/S)

488

20%15% 26%18% Raw Water

Labour

150on B

aht

8%21%5%

16%

Labour

Electricity

Depreciation

Jan-Mar 08

Milli

o

20%12%

4%

18%13%

4%Chemical

Cost of Services47% 48%45%

2007 2008 Jan-Mar 09

COGS Rev

13%Others

Jan-Mar 09COGS Rev


East Water Group Performance

Million Baht

1 200

1,400

1 0611,133

1,263

Million Baht

800

1,000

1,200

822 796 764

917 1,049 1,061

600

800

505 505432

606

334 409 18.55%

YoY

200

400 214

334

193 252

345

10.56%

32.45%YoY

-

2005 2006 2007 2008 Jan-Mar 09

YoY

Net Profit EBIT EBITDA


Financial Structure of East Water

Consolidated D/E Ratio

1 171.25

Consolidated D/E Ratio

1.25

Separated D/E Ratio

1.081.17

1 0.941.01

1

0 66 0.53 0.54

0.75

Tim

es

0 48

0.75

mes

0.66 0.54

0 25

0.5

T

0.550.48 0.49

0.5Tim

0

0.25

0

0.25

26* ROE and ROA were annualized in order to compare which the year end period

Dividend Policy

Baht/Share*

0.5 0.39 0.390.33 0.35

0.30.25 0.25 0.25 0.25

0.0

64% 64% 76% 71%

2005 2006 2007 2008

EPS DPS

* Adjusting figure for comparison purpose of par split from 10 to 1 Baht/share since May 200527

Consolidated Financial Ratio

Financial Ratio Jan Mar 09 Jan Mar 08Financial Ratio Jan - Mar 09 Jan - Mar 08

Gross Profit Margin (%) 61.27 57.87

Net Profit Margin (%) 30.63 31.55g ( )

ROA (%) 9.25* 8.11*

ROE (%) 14.20* 13.25*

Debt to Equity Ratio (times) 0.54 0.61

Interest Coverage Ratio (times) 12 68 7 51Interest Coverage Ratio (times) 12.68 7.51

28 * ROE and ROA were annualized in order to compare which the year end period

Source of FundsSource of Loan Amount

(MB)Outsta-nding

Tenor (years)

Rate2005-2007

Rate2008-2009

Rate2010-2011

Long-Term Loan from KTB- Tranche A

1500500

866184

77

4.5*4.5*

4.5*4.5*

MLR-0.75MLR-0.75

- Tranche B

Source of Loan Amount (MB)

Outsta-nding

Tenor (years)

Rate2007-2009

Rate2010-2011

Rate2012-2013

Long-Term Loan from KTB- Tranche C 1500 1450 7 4.8 MLR-1.75 MLR-1.50

Source of Loan Amount (MB)

Outsta-nding

Tenor (years)

Rate2009

Rate2010-2013

Rate2014-2016

Long-Term Loan from KBANK- Tranche A 1000 - 7 MMR MLR-1.75 MLR-1.50

* New interest rate be adjusted down from 6% and MLR-1.5% for KTB Long-Term Loan in Tranche A and B respectively, to 4.5% from July 2007 to Oct 201029

ContentsContents




Future InvestmentsFuture Investments

30

Future Projects

Raw Water ProjectsWaterworks Projects

•Existing Contract Expansion

Raw Water Projects

1. Pipeline Expansion• NongPlaLai-MapTaPhut 3 •Existing Contract Expansion

•Chonburi Project•Industrial water / Wastewater Projects

• Improvement Dokkrai Pumping Station

• Nongplalai-NongKho Pipeline ExpansionExpansion

• NongKho-Leamchabang Pipeline Expansion

Special Projects2. Alternative Water Resources

• Private Pond• Off-Stream Reservoir• Desalination

Special Projects

•Mini Hydro Turbine Generator Project (Prasae Reservoir, Nongplalai-Nongkho• Desalination

3. Monitoring Project• Southern Seaboard Project

( , gp gPipeline)

•Expand to Regional / SE Asia

31

Waterworks Projects

• Samui Island WW.– The expansion project to increase capacities from 3,000 to 6,000 m3. per day is still in process ,

th i t th b i i f t (2010) hi h i t t b d t the revenue may recognize at the beginning of next year (2010) which investment budget approx.

100MB, 30 years concession, price decrease to 36.5 baht/m3

• Chonburi WW • Chonburi WW. – Already sign the tap water sales contract of minimum 24,000 m3. per day, the revenue

recognized effect at the end of 2009, 20 years concession, minimum tariff 9.75 baht/m3

• Expand to Regional / SE Asia

P t ti l P j t i I di (B l )•Potential Project in India (Bangalore)- 5-year water loss reduction project with 3 contracts for a budget more than 2,000 MB and

funded by JIBIC funded by JIBIC

32

Indicative East water Group’s Capital Expenditure

Projects TotalMB

2009MB

2010MB

2011MB

2012MB

2013MB

Unit : Million Baht

Raw Water Projects(Existing Cap. Enhancement) 3,000 870 1,420 150 120 440

Tap Water Projects 600 250 110 220 20 0

Total Capital Expenditure 3,600 1,120 1,530 370 140 440

R W t P j tRaw Water Projects(Alternative Projects)** 3,100 - 1,200 730 730 440

33** Alternative Project is not calculated in the CAPEX as it is a raw water replacement project which will be updated in the future

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eastern water resources development and management plc....

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