31 st ANNUAL GENERAL MEETING

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1 31 st ANNUAL GENERAL MEETING 27 th June 2013

2 Datuk Syed Hisham bin Syed Wazir President & Group CEO

3 CORPORATE INFORMATION Authorised Share Capital Issued and Paid Up Share Capital Component Of Bursa Malaysia Listing Sector Market Capitalisation at RM14.30 per share (As at 26 th June 2013) Share Price 2012 RM1,000,000,000 RM584,146,966 FTSE Bursa Malaysia KLCI (FBMKLCI) Main Market, Consumer Products RM16.7 billion Year High = RM12.16 (Intraday-19 December 2012) Year Low = RM6.80 (Intraday-19 January 2012) (As at 31 st December 2012) = RM

51% Other Local Shareholders, 11.30% Employees Provident Fund Board, 14.

4 SHAREHOLDING STRUCTURE As at 31 st May 2013 Permodalan Nasional Berhad (PNB)/ PNB Managed Unit Trust Funds, 50.14% Foreign Shareholders, 24.51% Other Local Shareholders, 11.30% Employees Provident Fund Board, 14.05% PNB and EPF shareholdings are based on direct interest and deemed interest 4

BUSINESS STRUCTURE Automotive Equipment Manufacturing & Engineering Oil & Gas UMW TOYOTA MOTOR Lexus Toyota PERUSAHAAN OTOMOBIL KEDUA Perodua HEAVY EQUIPMENT Construction Mining Agriculture Forestry

Industrial Standby Generators Power Products CNG Refuelling Stations LUBRICANTS & FLUIDS Pennzoil Repsol Grantt GEP Fluids & Coolants SHOCK ABSORBERS /POWER STEERING KYB AUTO COMPONENTS Filtration

5 BUSINESS STRUCTURE Automotive Equipment Manufacturing & Engineering Oil & Gas UMW TOYOTA MOTOR Lexus Toyota PERUSAHAAN OTOMOBIL KEDUA Perodua HEAVY EQUIPMENT Construction Mining Agriculture Forestry Industrial Fire Fighting & Oil Spill INDUSTRIAL EQUIPMENT Material-Handling Equipment Industrial Cleaning Equipment Tyres & Batteries MARINE & POWER EQUIPMENT Industrial Compressors Marine Engines Industrial Standby Generators Power Products CNG Refuelling Stations LUBRICANTS & FLUIDS Pennzoil Repsol Grantt GEP Fluids & Coolants SHOCK ABSORBERS /POWER STEERING KYB AUTO COMPONENTS Filtration Products Plastic Injection Metal Stamping DENSO Spark Plugs & Wiper Blades GEP Filters & Brake Pads DRILLING OPERATIONS Semi-submersible Rig Jack-up Rigs Onshore rigs Workover Rigs OILFIELD SERVICES Generator Packages Pipe Inspection, Repair & Threading Pipe Coating MANUFACTURE OF PIPES Seamless OCTG SSAW Line Pipes LSAW Line Pipes FABRICATION Onshore & Offshore Structures Industrial Cranes OILFIELD PRODUCTS 5

6 DOMESTIC PRESENCE Malaysia Branches Dealerships Total UMW Toyota Motor Sdn. Bhd. (Including Lexus) Topmark (Division of UMW Toyota) Perusahaan Otomobil Kedua Sdn. Bhd. (Associate) UMW Industries (1985) Sdn. Bhd. UMW Industrial Power Sdn. Bhd. UMW (East Malaysia) Sdn. Bhd. (Sabah & Sarawak) UMW Equipment Sdn. Bhd. Toyota Capital Malaysia Sdn. Bhd. (Associate) Total

7 INTERNATIONAL PRESENCE 13 countries (including Malaysia) Turkmenistan Myanmar Automotive Equipment Manufacturing & Engineering Oil & Gas China Taiwan Vietnam Malaysia Papua New Guinea Singapore Total Staff Strength (as of May 2013) 13,467 Australia Indonesia Oman India Thailand 7

8 FINANCIAL HIGHLIGHTS

9 2012 Financial Performance % Revenue RM mil 15, , Profit Before Taxation RM mil 2, , Profit Attributable To Equity Holders of The Company RM mil Shareholders Funds RM mil 4, , Return on Shareholders Funds % Return on Total Assets % Dividend Rate - Gross % Dividend Payout Ratio % (21.8) Basic Earnings Per Share Sen Net Assets Per Share RM

10 10-YEAR GROUP FINANCIAL HIGHLIGHTS AUTOMOTIVE EQUIPMENT M & E OIL & GAS Revenue (RM million) 15,864 Profit Before Taxation (RM million) 2,010 9,869 9,950 9,976 12,770 10,721 13,536 12,820 1,277 1,313 1,365 5,223 6, Record Year 10

11 10-YEAR GROUP FINANCIAL HIGHLIGHTS... AUTOMOTIVE EQUIPMENT M & E OIL & GAS Total Assets (RM million) Shareholders Funds (RM million) 3,401 3,931 5,721 5,103 6,491 7,828 8,826 10,541 10,024 11,792 1,922 2,131 2,342 2,560 3,130 3,522 3,774 4,027 4,249 4,

12 Key Performance Indicators Dividend Policy ANNUAL DIVIDEND PAYOUT, 50% OF PROFIT NET OF UNREALISED GAINS Target 50% % Of Group s Net Profit Gross Dividend Per Share Of RM0.50 Each (sen) 50.0* October 03 2-for-3 Bonus Issue March 08 Share Split from RM1.00 to RM0.50 each * Subject to shareholders approval 12

13 AAA CORPORATE CREDIT RATING UMW is rated AAA (Corporate Credit Rating) by RAM Rating Services Berhad (RAM). 13

14 AUTOMOTIVE Operations

15 TOTAL INDUSTRY VOLUME (TIV) FOR 2012 Units 630, , , , % 615, , , , , , , , , MAA forecast 2012 actual *MAA = Malaysian Automotive Association 15

16 UMW GROUP S MARKET SHARE Units & Market Share (%) In 2012 Brand (2011) Perodua 179, % Perodua 189, % Proton Nissan Honda Hyundai, Kia Volkswagen Others Market Share % Units 141,121 36,271 34,950 13,168 13,019 93,465 Market Share % Units 158,657 32,276 32,480 9,259 7,350 91,450 Total , ,472 (2011) UMW Toyota 88, % UMW Toyota 106, % Others 331, % (2011) Others 331, % UMW companies sold 295,759 units in 2012 with a market share of 47.1%. Our market share in 2011 was approximately 45%. 16

17 UMW TOYOTA MOTOR ACHIEVEMENTS & HIGHLIGHTS IN UMW Toyota has maintained the No.1 position in the non-national segment for 23 consecutive years. 2. Production volume at UMW Toyota Motor s assembly/manufacturing arm reached 83,552 units, increased by 32% from Vios continued to be UMW Toyota Motor s best-selling model, offering favourable design at an affordable price, followed by Toyota Hilux - a new and improved version was introduced to the market in October Higher sales volume was recorded in 2012 due to:- i. New models launched ii. Incentives given to hybrid cars. Government introduced import and excise duties exemption for hybrid cars, up to 2,000cc in This exemption will expire on 31 st December We have 3 models in this category Toyota Prius, Toyota Prius C and Lexus CT200h. iii. Special promotions in conjunction with UMW Toyota Motor s 30 th Anniversary celebrations. 17

18 TOYOTA MODEL LAUNCHES IN January 2012 Toyota Avanza RM65.8k to RM79.6k 20 February 2012 Toyota Prius C 1.5 Hybrid RM97,000 1 June 2012 Toyota Camry RM149,000 - RM181,000 1 June 2012 Toyota 86 RM243,000 - RM249,000 18

19 LEXUS MODEL LAUNCHES IN 2012 March 2012 Lexus GS Series OTR from RM376,000 May 2012 Lexus RX Series OTR from RM369,000 19

20 PERODUA ACHIEVEMENTS & HIGHLIGHTS IN Retained No. 1 position for the 7th consecutive year in 2012, contributed by the bestselling Myvi and increased sales of Alza. 2. Perodua produced 194,985 units (including export) for 2012 in tandem with the sales demand. 3. Currently, Perodua exports its vehicles to seven countries, namely, Singapore, Brunei, Mauritius, Fiji, Sri Lanka, the United Kingdom and Nepal. 4. Perodua also exports its Myvi model to Indonesia under the Daihatsu Sirion badge. 5. A new plant in Rawang is being set-up and it will be able to produce 100,000 vehicles yearly on a one-shift cycle, by the middle of

21 PERODUA MODEL LAUNCHES IN February 2012 Alza SR From RM53, June 2012 New Alza ZHV Advanced Version From RM69,517 21

22 PROSPECTS FOR 2013 Malaysian Automotive Association (MAA) target = 640,000 units (+2.0% growth) We expect a very competitive market in 2013 due to healthy demand and new model launches. We hope to maintain our market share between 45% and 47%. 22

23 EQUIPMENT Operations

24 EQUIPMENT DIVISION UMW represents all of the above principals for some of the world s most recognised products in:- Agriculture Construction Forestry Mining Industrial and manufacturing Industrial cleaning food and beverages, material handling and logistics 24

25 EQUIPMENT DIVISION ACHIEVEMENTS & HIGHLIGHTS IN Our Equipment Division continued to generate strong revenue due to sustained demand for major equipment and forklifts, and expansion of equipment rental fleet size. 2. UMW continues to be the No. 1 in the heavy equipment segment, with an overall market share of above 30%. 3. Toyota forklift maintained its 50% market share in Malaysia s material handling equipment business. 4. UMW again won the prestigious President s Gold Award 2012 from Toyota Material Handling International for excellent performance in sales and customer support. 5. Our operations in Papua New Guinea registered a strong turnaround due to a new parts supply agreement signed with the mining sector. 25

26 PROSPECTS FOR 2013 EQUIPMENT DIVISION We are confident of our Equipment Division s performance for The domestic situation in the jade mining area of Myanmar has stabilised. Jade mining activities are expected to resume in the second half of Demand for equipment is forecasted to improve. Profitability of the Division is expected to sustain resulting from better cost management and increased parts sales. We hope to maintain our 50% market share for the forklift business in Malaysia. We have also recently been awarded a contract in March 2013 to supply 15 units of Airport Fire-Fighting Vehicles and 1 unit of Tactical Simulator Static Cabin to Malaysia Airports Holdings Berhad (MAHB) at a total value of more than RM45 million. 26

27 OIL & GAS Operations

28 OIL & GAS OPERATIONS Upstream Exploration & Production Drilling Operations Oilfield Services - Generator Packages - Pipe Inspection, Repair & Threading - Pipe Coating Manufacture Of OCTG & Line Pipes Fabrication Oilfield Products 28

29 OIL & GAS DIVISION ACHIEVEMENTS & HIGHLIGHTS NAGA 1 1. The current contract duration is for five years which commenced in 2010, valued at USD250 million, with Petronas Carigali Sdn. Bhd. 2. During the period, rig upgrading works were carried out for a duration of about nine months. In view of this, the current contract expiry date is extended to August In addition, Petronas Carigali Sdn. Bhd. has awarded a contract extension for a further period of two years commencing August 2016, valued at USD130 million. 29

OIL & GAS DIVISION ACHIEVEMENTS & HIGHLIGHTS NAGA 2 1. Commenced drilling operations in September 2010 after being awarded a contract by HESS (Indonesia - Pangkah) Limited.

30 OIL & GAS DIVISION ACHIEVEMENTS & HIGHLIGHTS NAGA 2 1. Commenced drilling operations in September 2010 after being awarded a contract by HESS (Indonesia - Pangkah) Limited. The contract expired in March NAGA 2 has secured a new contract from Petrovietnam Drilling and Well Services Corp for the provision of drilling services. 3. The contract secured is for six months with an option for another six months, starting from May

OIL & GAS DIVISION ACHIEVEMENTS & HIGHLIGHTS NAGA 3 1. Started working for Petronas Carigali Sdn. Bhd. in March 20

31 OIL & GAS DIVISION ACHIEVEMENTS & HIGHLIGHTS NAGA 3 1. Started working for Petronas Carigali Sdn. Bhd. in March The contract was extended by Petronas Carigali Sdn. Bhd. for a 2-year period, worth USD105 million in March This will result in higher earnings contribution from NAGA 3. 31

OIL & GAS DIVISION ACHIEVEMENTS & HIGHLIGHTS NAGA 4 1. We purchased a new premium jack-up drilling rig in June 2012 for USD214 million. 2. We took delivery of the rig, NAGA 4 on 16 th February 2013.

32 OIL & GAS DIVISION ACHIEVEMENTS & HIGHLIGHTS NAGA 4 1. We purchased a new premium jack-up drilling rig in June 2012 for USD214 million. 2. We took delivery of the rig, NAGA 4 on 16 th February Entered into a contract with Petronas Carigali Sdn. Bhd., valued at approximately USD158 million in April The contract is for a duration of three years, with an additional two-year option for renewal. The rig is operating at offshore Terengganu. 32

OIL & GAS DIVISION ACHIEVEMENTS & HIGHLIGHTS WORKOVER SERVICES 1. UMW Petrodril (Malaysia) Sdn. Bhd. owns and operates 4 hydraulic workover units (HWUs). 2.

33 OIL & GAS DIVISION ACHIEVEMENTS & HIGHLIGHTS WORKOVER SERVICES 1. UMW Petrodril (Malaysia) Sdn. Bhd. owns and operates 4 hydraulic workover units (HWUs). 2. Currently, 3 HWUs are in operations in Malaysia, Indonesia and Thailand. 3. We were awarded a USD140 million contract by Sabah Shell Petroleum Co. Ltd. to supply a single combo top tension riser for the latter's offshore oil and gas operations within deepwater Malikai field in Sabah in November

34 OIL & GAS DIVISION ACHIEVEMENTS & HIGHLIGHTS 1. Revenue for 2012 increased by 40% due to:- A full-year operation of NAGA 3, coupled with an increased day-rate. A full-year operation of HAKURYU-5 Additional revenue contribution from the Garraf Power Plant Phase 1 project in Iraq. 2. In 2012, the Oil & Gas Division has achieved a profit before taxation of RM57.7 million. This shows that the Division has turned-around after 2 consecutive years of losses. 3. UMW Oil & Gas signed an MoU with Institut Teknologi Petroleum PETRONAS (INSTEP) for the establishment of a drilling academy to build local capabilities in the oil & gas industry. 20 participants completed the first joint-programme, Surface Blowout Preventer Programme in February A structured, long-term Professional Driller training programme is expected to start in July

35 PROSPECTS FOR 2013 Full-year contribution from the refurbished NAGA 1, higher daily operating rate for NAGA 2 and continuing contract for NAGA 3. Additional contribution from the new NAGA 4. Commissioning of the new Electric Resistance Welded (ERW) and coating plant in China. On 16 th May 2013, we announced plans to list our Oil & Gas Division this year. Accelerate the growth of the oil & gas business. Enable us to unlock and crystallise the value of our investment in oil & gas. Proceeds from the listing will enable us to finance our expansion and reduce our borrowings. Provide further flexibility for us to raise funds for other strategic purposes. Increase UMW O&G s visibility as one of the leading oil & gas companies in Malaysia. (Due to the regulations related to the IPO, further details will be provided upon approval by the relevant authorities). 35

36 MANUFACTURING & ENGINEERING Operations

37 KEY PRODUCTS Lubricants & Fluids Fluids & Chemicals Shock Absorbers & Power Steering Lubricants & Fluids (China) Auto Components Auto Components (India) 37

38 MANUFACTURING & ENGINEERING DIVISION ACHIEVEMENTS & HIGHLIGHTS 1. Revenue for 2012 increased marginally due to:- Stronger demand for Kayaba products Improved sales from our automotive parts business in India. Improved lubricants business in China. 2. Consequently, the Division turned-around to register a profit before taxation of RM3.6 million, after registering a loss of RM11.9 million in Started supplying high-end automotive lubricants to First Automobile Works (FAW) of China for Mazda, Hongqi and Ben Teng. 4. Lubetech Sdn. Bhd. secured new businesses from PERODUA and Delphi in REPSOL products are distributed by a wide network of 350 Master Dealers. 38

39 PROSPECTS FOR 2013 Higher capacity utilisation for our automotive component plants in India and lubricant plant in China. Increased sales of Repsol and Pennzoil lubricant products. Kayaba is optimistic of a better performance this year, particularly from the replacement equipment (RE) for export market. Further opportunities with the FAW Group, one of the biggest automotive groups in China. We entered into a joint venture with the Blue Bird Group (BBG) of Indonesia to provide lubricants, automotive components and service centre operations in Indonesia. BBG is a leading transportation company in Indonesia with a fleet of 26,000 vehicles. 39

40 Corporate Social Responsibility 2012 Highlights

41 CORPORATE SOCIAL RESPONSIBILITY (CSR) Our CSR strategy is in line with and reflective of our rallying call Beyond Boundaries. UMW CSR programmes are focused on: EDUCATION COMMUNITY DEVELOPMENT ENVIRONMENT We also invest our time in various CSR projects, through our employee-volunteers, the UMW Community Champions. 41

CORPORATE SOCIAL RESPONSIBILITY (CSR) UMW PINTAR

continued to sponsor 7 schools under the UMW-PINTAR

Activities include extra tuition classes, PMR

42 CORPORATE SOCIAL RESPONSIBILITY (CSR) UMW PINTAR Programme (an educational programme) In 2012, UMW continued to sponsor 7 schools under the UMW-PINTAR Programme. Our participation started in Activities include extra tuition classes, PMR motivational camps, etc. To date, 16 schools and 13,171 students have benefited from the programme 42

CORPORATE SOCIAL RESPONSIBILITY (CSR) UMW-MERCY

programme) The UMW-MERCY CSR partnership continued on

43 CORPORATE SOCIAL RESPONSIBILITY (CSR) UMW-MERCY Malaysia Outreach Clinic (a community development programme) The UMW-MERCY CSR partnership continued on its mission to bridge the healthcare divide for the 5 th year. To date, approximately 14,563 people have benefited from our projects with MERCY Malaysia since

44 CORPORATE SOCIAL RESPONSIBILITY (CSR) UMW COMMUNITY CHAMPIONS PROJECTS - staff volunteerism programme, focusing on:- The environment (planted more than 4,000 trees over 3 years). The underprivileged Festive seasons In 2012, UMW Community Champions clocked 3,576 community hours. 44

45 CORPORATE SOCIAL RESPONSIBILITY (CSR) OTHER SOCIAL & CHARITABLE ACTIVITIES Toyota Classics Concert 2012 managed to raise RM320,328. The proceeds were donated to two charitable and non-governmental organisations: i. Persatuan Pemulihan Orang-Orang Cacat Selangor & Wilayah Persekutuan; ii. Malaysia-Japan International Institute of Technology. Contribution for major religious festivals celebrations UMW also has an annual scheme to award small grants and special donations to the community on a case-to-case basis. 45

46 QUESTIONS from MINORITY SHAREHOLDER WATCHDOG GROUP (MSWG)

47 Strategic and Financial Matters 1. The Chairman in his statement stated that the Automotive Division achieved record sales and remained the biggest contributor to the Group s earnings. Q1: Given the intense competition in the automotive industry, how confident is the Board that the Company would be able to sustain the performance of its Automotive Division for FY2013? A1: We are not new to competition in the Automotive Industry. There will always be new and competitively-priced models introduced by various players in the industry. Our strategy is to provide value-for-money models and a positive ownership experience. For now, UMW Toyota Motor and Perodua are maintaining their 2013 sales targets. Q2: Would there be any launch of new models this year? A2: New model launches are part of our strategy to keep up with the competition. We launched the enhanced Camry earlier this month. We are unable to disclose new model launches as this may have an impact on the sales of existing models. Announcements on new or enhanced models will be made by UMW Toyota Motor and Perodua in due course. 47

48 Strategic and Financial Matters 2. It was reported in the latest quarterly announcement that the revenue of the Equipment segment declined due to lower demand for the Group s major equipment in Myanmar, but this was compensated by the higher parts sales in Niugini. Q1: What are the factors that would impact the demand for equipment? A1: The low worldwide demand for jade in Q and Q coupled with the suspension of the jade mining industry by the Myanmar Government due to some domestic issues, affected our operations in Myanmar, contributing to the lower revenue achieved. Q2: What is the Board s view on the performance of this segment for the rest of the year? A2: We are confident of our Equipment Division s performance for The domestic situation in the jade mining area of Myanmar has stabilised. Jade mining activities are expected to resume in the second half of Demand for equipment is forecasted to improve. We have also recently been awarded a contract in March 2013 to supply 15 units of Airport Fire-Fighting Vehicles and 1 unit of Tactical Simulator Static Cabin to Malaysia Airports Holdings Berhad (MAHB) at a total value of more than RM45 million. 48

49 Strategic and Financial Matters Q3. What is the nature of impairment loss of RM25.2 million on property, plant and equipment? A3. The carrying amount of property, plant and equipment are reviewed at each reporting date to determine whether there is any indication of impairment. When such indication exists, the carrying amount of the assets are written down immediately to its recoverable value, to reflect the market value. In this case, assets being impaired are rigs and property. 49

50 CORPORATE GOVERNANCE MATTERS Q1: We noted that the Company had not disclosed the executive directors remuneration according to the requirement under Chapter 9, Appendix 9C, Part A of the Main Market Listing Requirement in 11(b) where directors remuneration must be disclosed by band of RM50,000. We would like to seek the Board s explanation on the matter. A1: We wish to highlight that Directors Remuneration has been disclosed on page 63 (Corporate Governance) and page 179 (Note 29 of the Financial Statements) of the Annual Report, according to the respective bands. In respect of the Corporate Governance section, disclosure of the 2012 remuneration starts with the RM100,000 band as none of the Directors is in the RM50,000 band level whereas in 2011, one of the Directors fell within the RM50,000 band level as disclosed in the Financial Statements. Q2: We also noted the Board s view on gender diversity on board and we look forward to its implementation and disclosure of the measures and positive steps taken in future Annual Reports. A2: The Board takes cognisance of MSWG s remarks on the above matter and will endeavour to include women participation in the management as well as the Board to fill vacancies as and when these arise. In identifying suitable candidates to fill these vacancies, the Board will assess the suitability of all candidates, based on their merits and contribution to the Board, regardless of gender. 50

51 Terima Kasih Sag Bol Cyay Zun Tin Par Tel 謝謝 cám ơn Tanikiu Thank You Terima Kasih ขอบค ณ நன ற شكر ا Turkmenistan Myanmar China Taiwan Vietnam Malaysia Papua New Guinea Singapore Australia Oman India Thailand Indonesia

UMW Holdings Berhad. CORPORATE PRESENTATION March 2015

UMW Holdings Berhad. CORPORATE PRESENTATION March 2015 UMW Holdings Berhad CORPORATE PRESENTATION March 2015 UMW MILESTONES 1917 1960s 1970 1980s 1990s 2000s 2010s - Chia Yee Soh founded a small family business in Singapore - Awarded Komatsu heavy equipment