results presentation - yongmao holdings...
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Yongmao Holdings LimitedYongmao Holdings LimitedIncorporated in the Republic of Singapore Company Registration No.200510649K
Results Presentation27 May 2009
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AgendaAgenda
About YongmaoAbout Yongmao
FY09 Performance ReviewFY09 Performance Review
Outlook & StrategyOutlook & Strategy
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About YongmaoAbout Yongmao
We are a We are a designer and manufacturer of towercranesdesigner and manufacturer of towercranesand towercrane components and accessoriesand towercrane components and accessories
Our towercranes are sold mainly to Our towercranes are sold mainly to construction construction companies and equipment rental companiescompanies and equipment rental companies in the in the PRC and to PRC and to construction equipment distributors and construction equipment distributors and equipment rental companiesequipment rental companies in America, Europe, Asia in America, Europe, Asia & Middle East and Africa& Middle East and Africa
Towercranes are used mainly in Towercranes are used mainly in construction sites, construction sites, infrastructure projects and in the shipbuilding industryinfrastructure projects and in the shipbuilding industry
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2007 FSYM Construction became a 100% subsidiary of the Company
2005 Further expanded Topless series towercranes FYEM � 1st towercrane manufacturer in China to qualify for CE Marking JV with SGX-ST listed Tat Hong and its subsidiary, Leadpoint Incorporated Singapore holding company Transfer of certain assets from FYEM to Fushun Yongmao Machinery
Construction Co., Ltd (FSYM Construction)
2002 Introduced ST series towercranes
20042004 Expanded Topless series and introduced Luffing seriesExpanded Topless series and introduced Luffing series
1998 Launched its first crane � QD8
19961996 Established Fushun Yongmao Engineering Machinery Co., Ltd (FYEM)Established Fushun Yongmao Engineering Machinery Co., Ltd (FYEM), a , a 75%75%--owned subsidiary, to manufacture and sell construction equipmentowned subsidiary, to manufacture and sell construction equipmentaccessories accessories
MilestonesMilestones
1992 Founded Fushun Yongmao Industry and Trade Co. Ltd with main business of selling and distributing construction materials and metal casting parts
19991999 Launched Topless STT towercranesLaunched Topless STT towercranes
20062006 Commencement of business operations under FSYM ConstructionCommencement of business operations under FSYM Construction
20082008 Listed on SGX main boardListed on SGX main board
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2009 Incorporated Towercrane Rental company Beijing Tathong Zhaomao Co Ltd Yongmao owned 45% and 55% owned by Tat Hong
Various new product launched including: STT 753 STL 420 ST 80/75
20082008 Established of JV in Wuxi called Wuxi Yongmao Towercrane Co. LtdEstablished of JV in Wuxi called Wuxi Yongmao Towercrane Co. Ltd (Wuxi (Wuxi YongmaoYongmao
Wuxi Yongmao is 80% owned by Fushun YongmaoWuxi Yongmao is 80% owned by Fushun Yongmao
First Crawler Crane SQ600 shipped to Tat Hong Singapore
Milestones Milestones �� 2008 & 20092008 & 2009
Completed the Acquisition of Beijing Yongmao Jiangong Machinery Construction Co. Ltd (Beijing Yongmao)
Beijing Yongmao is now 66% owned subsidiary of Fushun Yongmao
Obtained Singapore MOM approval for STL230Obtained Singapore MOM approval for STL230
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Our Products Our Products -- TowercranesTowercranes
Topless STT ST Luffing STL Derrick Q
TTOWERCRANESOWERCRANES
Topless STT
ST
Luffing STL Derrick Q
We have 4 series of towercranes:
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Our Products Our Products -- TowercranesTowercranes
Topless STT
24 models 24 models
Capacity: 4 Capacity: 4 -- 24 tonnes24 tonnes
Suitable for largeSuitable for large--scale projects with space constraintsscale projects with space constraints
Revenue contribution : Revenue contribution : FY2009: 43.8% FY2009: 43.8% ↓↓
FY2008: 50.4%FY2008: 50.4%
ST
14 models 14 models
Capacity: 6 Capacity: 6 -- 50 tonnes50 tonnes
Suitable for use in construction sites of all sizesSuitable for use in construction sites of all sizes
Revenue contribution : Revenue contribution : FY2009: 39.3% FY2009: 39.3% ↑↑
FY2008: 29.8%FY2008: 29.8%
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Our Products Our Products -- TowercranesTowercranes
Luffing STL
14 models 14 models
Capacity: 4 Capacity: 4 -- 32 tonnes32 tonnes
Suitable for use in congested worksites where Suitable for use in congested worksites where there is space constraintthere is space constraint
Revenue contribution : Revenue contribution : FY2009: 10.4% FY2009: 10.4% ↑↑
FY2008: 8.3%FY2008: 8.3%
Derrick Q
3 models 3 models
Capacity: 6 Capacity: 6 -- 10 tonnes10 tonnes
Designed specially for dismantling internal climbing Designed specially for dismantling internal climbing towercranes in a safe and reliable mannertowercranes in a safe and reliable manner
Revenue contribution : Revenue contribution : FY2009: 0.1%FY2009: 0.1%FY2008: 0.3%FY2008: 0.3%
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Towercrane Components and AccessoriesTowercrane Components and Accessories
We also manufacture and/or sell towercrane components and We also manufacture and/or sell towercrane components and accessoriesaccessories
Enable customers to replace worn out or faulty components and toEnable customers to replace worn out or faulty components and toextend height of towercranes and length of jibsextend height of towercranes and length of jibs
Revenue contribution : Revenue contribution : FY2009: 6.4% FY2009: 6.4% FY2008: 11.2%FY2008: 11.2%
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3 Production facilities :3 Production facilities :�� Fushun City, LiaoningFushun City, Liaoning
�� BeijingBeijing
�� WuxiWuxi
Where We AreWhere We Are
Fushun
Beijing �
Wuxi
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Investment HighlightsInvestment Highlights
Depth and breadth of management experienceDepth and breadth of management experience
Wide product rangeWide product range
Strong R&D focusStrong R&D focus
Good exposure to overseas & domestic marketsGood exposure to overseas & domestic markets
Industry-wide recognition for quality and reliabilityIndustry-wide recognition for quality and reliability
Good control over critical stages of the value chainGood control over critical stages of the value chain
Significant barriers to entrySignificant barriers to entry
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Good Value Chain ControlGood Value Chain Control
Established network of domestic and overseas customersEstablished network of domestic and overseas customers
InIn--house capabilities to develop new products to cater to house capabilities to develop new products to cater to market demandmarket demand
Cutting MachiningSurface
TreatmentTesting
DesignDesign
ManufactureManufacture
Sales & MarketingSales &
Marketing
Ability to deliver orders in 30 Ability to deliver orders in 30 -- 90 days90 days
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IndustryIndustry--wide recognitionwide recognition
Established Track RecordEstablished Track Record Towercranes employed in prominent commercial and infrastructure Towercranes employed in prominent commercial and infrastructure
projects overseas and in the PRCprojects overseas and in the PRC
China National Opera House China
Olympic Stadium China
Qinshan Nuclear Power StationChina
AZ - St. Jan General HospitalBelgium
Turf CityDubai, UAE
Fujian LNG ProjectChina
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IndustryIndustry--wide recognitionwide recognition
Strong Brand RecognitionStrong Brand Recognition
抚顺名牌产品抚顺名牌产品 Fushun Famous Brand Product (for Topless Fushun Famous Brand Product (for Topless towercranes) towercranes)
辽宁省名牌产品辽宁省名牌产品 Liaoning Province Famous Brand (for Topless Liaoning Province Famous Brand (for Topless towercranes)towercranes)
辽宁省中小企业名优产品辽宁省中小企业名优产品: : 金奖金奖 Liaoning Province SME High Liaoning Province SME High Quality WellQuality Well--Known Product: Gold Award Known Product: Gold Award
辽宁省著名商标辽宁省著名商标��永茂永茂�� Liaoning Province Famous Brand Liaoning Province Famous Brand ��YongmaoYongmao��
Our 3 brands :Our 3 brands :
永茂
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Stringent Quality Control and Assurance Standards Stringent Quality Control and Assurance Standards
ISO 9001:2000 Quality Management System CertificateISO 9001:2000 Quality Management System Certificate
KOSHA CertificateKOSHA Certificate
CE MarkingCE Marking
UkrSEPRO CertificateUkrSEPRO Certificate
Singapore MOM approvalSingapore MOM approval
GOST approval GOST approval -- RussiaRussia
Industry-wide recognition
First Chinese towercrane manufacturer to qualify for the CE Marking, a certification which allows our products to be sold and used in Europe
Obtained approval for our STL 230 to be sold and used in SINGAPORE
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Good Exposure to Overseas MarketsGood Exposure to Overseas Markets
CHINACHINAUnited StatesUnited States
PanamaPanamaTrinidad & Trinidad &
TobagoTobagoEcuadorEcuador
BrazilBrazil
ChileChile
AngolaAngola
ZambiaZambia
South AfricaSouth Africa
TanzaniaTanzania
AustraliaAustraliaNZNZ
IndonesiaIndonesia
SingaporeSingaporeMalaysiaMalaysia
PhilippinesPhilippines
MacauMacauHKHK
ThailandThailand
RussiaRussia
S. KoreaS. Korea
NigeriaNigeria
FinlandFinland
IrelandIreland UKUK
BelgiumBelgium
FranceFrance
AustriaAustriaUkraineUkraine
RomaniaRomania
TurkeyTurkey
Middle Middle EastEast
IndiaIndia
Sri LankaSri Lanka
Global Presence Global Presence �� Product used in more than Product used in more than 60 Countries60 Countries
CyprusCyprus
NamibiaNamibia
EgyptEgyptVietnamVietnam
AzerbaijianAzerbaijian
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LongLong--term Partnerships with:term Partnerships with:
Good Exposure to Overseas MarketsGood Exposure to Overseas Markets
Customers Country
House of Equipment L.L.CHouse of Equipment L.L.C UAE, Middle EastUAE, Middle East
Lewis Equipment CompanyLewis Equipment Company United StatesUnited States
Jin Long B.V.B.A.Jin Long B.V.B.A. Belgium, EuropeBelgium, Europe
AST Equipment (HK) Co. LtdAST Equipment (HK) Co. Ltd Hong Kong, AsiaHong Kong, Asia
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LongLong--term Partnerships with:term Partnerships with:
Strong Customer Base in PRC Domestic Strong Customer Base in PRC Domestic MarketsMarkets
Customers Country
China Nuclear Huaxing Tat Hong Machinery China Nuclear Huaxing Tat Hong Machinery
Construction Co LtdConstruction Co Ltd
PRCPRC
Shanghai Tat Hong Equipment Rental Co LtdShanghai Tat Hong Equipment Rental Co Ltd PRCPRC
Shanghai Jian Gong GroupShanghai Jian Gong Group PRCPRC
Beijing Jian Gong GroupBeijing Jian Gong Group PRCPRC
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Strong R&D FocusStrong R&D Focus
Strong InStrong In--house R&D and Technical Capabilitieshouse R&D and Technical Capabilities
Developed approximately 50 models and subDeveloped approximately 50 models and sub--models of towercranesmodels of towercranes
Ability to develop and customize new products to cater to marketAbility to develop and customize new products to cater to marketdemanddemand
R&D team comprises 30 designers and engineers who use computerR&D team comprises 30 designers and engineers who use computer--aided design applications, reducing time and costs in designingaided design applications, reducing time and costs in designing
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Wide Product RangeWide Product Range
Offer a variety of towercranes with Offer a variety of towercranes with lifting capacity ranging from 80 lifting capacity ranging from 80 �� 500 500 tonne metrestonne metres
Licensed to manufacture highLicensed to manufacture high--tonnage hoisting machinery tonnage hoisting machinery ((超大型起重机超大型起重机))
Offer technical advice and afterOffer technical advice and after--sales sales maintenance services to keep our maintenance services to keep our cranes operationally safe, efficient cranes operationally safe, efficient and reliableand reliable
Wide Range of Towercranes and Comprehensive Range of Technical Wide Range of Towercranes and Comprehensive Range of Technical Advice and AfterAdvice and After--sales Maintenance Servicessales Maintenance Services
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Depth & Breadth of Management ExperienceDepth & Breadth of Management Experience
Founder and Executive Chairman, Mr Sun Founder and Executive Chairman, Mr Sun Zhao Lin Zhao Lin ((孙兆林孙兆林)), and Co, and Co--founder and CEO founder and CEO Ms Tian Ruo NanMs Tian Ruo Nan ((田若南田若南)), possess , possess more than more than 10 years10 years�� experience eachexperience each in crane in crane manufacturing businessmanufacturing business
Together with the senior management, Together with the senior management, Yongmao is able to Yongmao is able to formulate and implement formulate and implement business strategiesbusiness strategies and and introduce new introduce new productsproducts to meet market demand to meet market demand
Experienced and Capable Management TeamExperienced and Capable Management Team
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Significant Barriers to EntrySignificant Barriers to Entry
Requires high level of expertise and Requires high level of expertise and experienceexperience
High initial capital investmentHigh initial capital investment
Need for track record and customer baseNeed for track record and customer base
Ability to comply with various safety Ability to comply with various safety standardsstandards
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AgendaAgenda
About YongmaoAbout Yongmao
FY09 Performance ReviewFY09 Performance Review
Outlook & StrategyOutlook & Strategy
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Revenue & Profit Revenue & Profit
(RMB �000) Q4FY09 Q4FY08 FY09 FY08
RevenueRevenue 69,49769,497 189,560189,560 594,467594,467 652,832652,832
Gross ProfitGross Profit 5,9005,900 68,19268,192 180,885180,885 242,167242,167
Profit before TaxProfit before Tax (20,063)(20,063) 25,27625,276 56,67856,678 126,464126,464
NPAT NPAT (Attributable to Shareholders (Attributable to Shareholders
of the Company)of the Company)(19,487)(19,487) 21,30321,303 47,53247,532 122,491122,491
EPS (RMB cents)EPS (RMB cents) (4.4)(4.4) 5.65.6 10.710.7 32.332.3
NET PROFIT AFTER TAX
0
50
100
150
FY08 FY09 Q4FY09
Q4FY08
653
594
190
69
0
100
200
300
400
500
600
FY08 FY09 Q4FY09 Q4FY08
REVENUE
122
48
21
(19)
700
RMB �mRMB �m
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Revenue & Gross Profit (FY09 v FY08)Revenue & Gross Profit (FY09 v FY08)
�� Group Revenue Group Revenue decline by 8.9%decline by 8.9% for FY09 and gross profit by 25.3% :for FY09 and gross profit by 25.3% :
�� Lower export sales to Lower export sales to USA, Europe and Middle East marketUSA, Europe and Middle East market
�� Export markets affected by Export markets affected by deteriorating global economydeteriorating global economy
�� Mitigated by higher sales in PRCMitigated by higher sales in PRC
�� Gross margin % Gross margin % decline by 6.7%decline by 6.7%::
�� Higher sales of lower margin ST series towercranesHigher sales of lower margin ST series towercranes
�� Higher average cost of steel materialsHigher average cost of steel materials
�� Lower average selling price due to price competitionLower average selling price due to price competition
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Net Profit After Tax Net Profit After Tax (attributable to shareholders)(attributable to shareholders)
0
20
40
60
80
100
120
140
FY08 FY09
122.5
47.5
Net Profit (FY09 vs. FY08) Net profit attributable to Net profit attributable to
shareholders decline due to shareholders decline due to lower saleslower sales and and gross margin gross margin %%
Higher operating expenses Higher operating expenses due to:due to:
�� Higher corporate expensesHigher corporate expenses as as a listed Companya listed Company
�� Higher Higher RentalRental & & ForexForex losseslosses
�� Higher tax expenses in FY09 Higher tax expenses in FY09 due to due to expiry of tax exemption expiry of tax exemption from Jan 08from Jan 08. .
61%61%
RMB�m
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Revenue Breakdown Revenue Breakdown �� Geography Geography �� Full YearFull Year
25%
32%
43%
39%
17%
44%
FY09 FY08
USA & EuropePRC Middle East, Asia & Others*
* Revenue classified under Middle East, Asia & Others excludes r* Revenue classified under Middle East, Asia & Others excludes revenue from the PRCevenue from the PRC
Growing revenue contribution from domestic PRC market
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Revenue Breakdown Revenue Breakdown -- Geography Geography �� 4 Quarter4 Quarter
37%
18%
45%
20%
78%
2%
Q4 FY09Q4 FY08
USA & EuropePRC Middle East, Asia & Others*
* Revenue classified under Middle East, Asia & Others excludes r* Revenue classified under Middle East, Asia & Others excludes revenue from the PRCevenue from the PRC
Domestic PRC sales form 78% of Revenue in Q4
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Number of Towercranes SoldNumber of Towercranes Sold
* Revenue classified under Middle East, Asia & Others excludes r* Revenue classified under Middle East, Asia & Others excludes revenue from the PRCevenue from the PRC
Growing Domestic PRC market
Q4 FY09 Q4 FY08 FY09 FY08
PRC 48 65 208 99
Middle East,
Asia &
Others
8 51 194 199
Europe &
USA
1 23 53 121
Total
57 139 455 419
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Balance Sheet and Key RatiosBalance Sheet and Key Ratios
(RMB (RMB ��m)m) 31 Mar 0931 Mar 09 31 Dec 0831 Dec 08 31 Mar 0831 Mar 08
Total nonTotal non--current assetscurrent assets 274.3274.3 228.5228.5 183.5183.5
Cash & cash equivalentsCash & cash equivalents 106.8106.8 127.3127.3 200.3200.3
Other current assetsOther current assets 401.4401.4 308.0308.0 335.0335.0
Total AssetsTotal Assets 782.5782.5 663.8663.8 718.8718.8
Total equity Total equity 488.7488.7 491.2491.2 445.2445.2
Total liabilitiesTotal liabilities 293.8293.8 172.6172.6 273.6273.6
Total Equity & LiabilitiesTotal Equity & Liabilities 782.5782.5 663.8663.8 718.8718.8
Ratios Ratios
ROEROE 10.3%10.3% 18.4%18.4% 27.5%27.5%
Debtor Turnover DaysDebtor Turnover Days 2323 1010 66
Creditor Turnover DaysCreditor Turnover Days 6060 4141 3737
Inventory Turnover DaysInventory Turnover Days 157157 110110 7272
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Cash FlowCash Flow
(RMB (RMB ��m)m) 31 Mar 0931 Mar 09 31 Dec 0831 Dec 08 31 Mar 0831 Mar 08
OperationsOperations (31.6)(31.6) (48.1)(48.1) 91.991.9
InvestmentsInvestments (98.5)(98.5) (49.0)(49.0) (150.1)(150.1)
FinancingFinancing 45.245.2 28.628.6 208.0208.0
Opening balanceOpening balance 200.3200.3 200.3200.3 50.350.3
Exchange adjustmentsExchange adjustments (8.7)(8.7) (4.5)(4.5) 0.20.2
Closing balanceClosing balance 106.7106.7 127.3127.3 200.3200.3
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SGX Listed PeersSGX Listed Peers Price (S$)Price (S$)21 May 0921 May 09
Market Cap Market Cap (S$(S$��m)m)
P/E (x)P/E (x) P/Bk (x)P/Bk (x)
Tat HongTat Hong 1.061.06 526.5526.5 6.56.5 1.51.5
Tiong WoonTiong Woon 0.420.42 141.8141.8 4.04.0 1.01.0
YongmaoYongmao 0.220.22 97.697.6 3.23.2 1.01.0
Valuation Comparison Valuation Comparison -- OutstandingOutstanding
Foreign Listed PeersForeign Listed Peers PricePrice21 May 0921 May 09
Market Cap Market Cap (USD(USD��m)m)
P/E (x)P/E (x) P/Bk (x)P/Bk (x)
TadanoTadano JPY466.00JPY466.00 639.1639.1 10.710.7 0.70.7
Favelle FavcoFavelle Favco MYR 0.85MYR 0.85 41.341.3 6.76.7 0.90.9
KomatsuKomatsu JPY 1350.00JPY 1350.00 14,279.914,279.9 17.117.1 1.61.6
ManitowocManitowoc US 6.08US 6.08 792.5792.5 2.52.5 1.31.3
Changsha ZoomlionChangsha Zoomlion CNY20.94CNY20.94 4,666.84,666.8 20.320.3 6.36.3
LonkingLonking HKD7.76HKD7.76 1,071.01,071.0 11.011.0 2.32.3
Source: BloombergSource: Bloomberg
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AgendaAgenda
About YongmaoAbout Yongmao
FY09 Performance ReviewFY09 Performance Review
Outlook & StrategyOutlook & Strategy
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OutlookOutlook
Global economy expected to be challenging for 2009 and Global economy expected to be challenging for 2009 and challenging business environment in our export marketschallenging business environment in our export markets
Construction activity in PRC however is expected to grow Construction activity in PRC however is expected to grow
Supported by Government RMB4 Trillion (US$500+ Billion) stimulusSupported by Government RMB4 Trillion (US$500+ Billion) stimuluspackage and continued spending on infrastructure projects such apackage and continued spending on infrastructure projects such as s railway transportation, electricity, disaster rebuilding, etcrailway transportation, electricity, disaster rebuilding, etc
PRC economy expanded 6.1% in the 1PRC economy expanded 6.1% in the 1stst Quarter 2009, Full year Quarter 2009, Full year estimated 8% growthestimated 8% growth
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StrategyStrategy
Improve product rangeImprove product range and and customer basecustomer base
Continued R&D investment to develop new products and Continued R&D investment to develop new products and improve existing tower crane modelsimprove existing tower crane models
Strengthen customer base in existing and new marketsStrengthen customer base in existing and new markets
Explore strategic investmentExplore strategic investment or acquisition opportunitiesor acquisition opportunities
Venture in Towercrane Venture in Towercrane RentalRental business in PRC : business in PRC :
with with TAT HONG, TAT HONG, setting up ofsetting up of
Beijing Tathong Beijing Tathong Zhaomao Zhaomao
Equipment Rental Co LtdEquipment Rental Co Ltd
To expand through acquisitions, JVs or strategic alliancesTo expand through acquisitions, JVs or strategic alliances
Yongmao Holdings LimitedYongmao Holdings LimitedIncorporated in the Republic of Singapore Company Registration No.200510649K
Results Presentation27 May 2009