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 distributorship in 65 - Secured the Toyota Forklift franchise in 67 - United Motor Works (Malaysia) Holdings Berhad listed on stock exchange - Awarded Toyota vehicle franchise in 82 - Permodalan Nasional Berhad became major shareholder in 87 - Largest shareholder in the 2nd national car project, Perodua, with Daihatsu Motor Co. Ltd. as the technology provider in 93 - Oil & Gas Division established as UMW s 4th core business in 02; - UMW is the official Lexus distributor in 06 - Rebranding of UMW in 08 - UMW Oil & Gas Corporation Berhad listed on Bursa Malaysia in 13 2
SHAREHOLDING STRUCTURE As At 31 March 2015 Permodalan Nasional Berhad (PNB)/ PNB Managed Unit Trust Funds, 51.74% Foreign Shareholders, 17.50% Other Local Shareholders, 14.19% Employees Provident Fund Board, 16.57% PNB and EPF shareholdings are based on * direct interest and deemed interest Market Capitalisation at RM10.84 per share (as at 31 Mar 2015) Total Number Of Shares Component Of Bursa Malaysia Listing Sector Bloomberg code UMWH:MK RM12.7 billion 1,168,293,932 FTSE Bursa Malaysia KLCI (FBMKLCI) Main Market, Consumer Products 3
BUSINESS STRUCTURE Automotive Equipment Manufacturing & Engineering UMW OIL & GAS CORPORATION BERHAD 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 LUBRICANTS & FLUIDS Pennzoil Repsol Grantt GEP Fluids & Coolants SHOCK ABSORBERS /HYDRAULIC POWER- STEERING PUMPS AND SYSTEMS KYB AUTO COMPONENTS Filtration Products Plastic Injection Metal Stamping DENSO Spark Plugs & Wiper Blades GEP Filters & Brake Pads OFFSHORE DRILLING WORKOVER OILFIELD SERVICES
DOMESTIC & INTERNATIONAL PRESENCE Extensive Network 13 countries Malaysia Branches Dealerships UMW Toyota Motor Sdn. Bhd. 37 60 Turkmenistan Myanmar Automotive Equipment Manufacturing & Engineering Oil & Gas Topmark (Division of UMW Toyota) 5 - 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) 41 142 16-8 - 9-5 - 5 - China Taiwan Vietnam Malaysia Papua New Guinea Singapore Australia Indonesia Total 126 202 Oman India Thailand Total Staff Strength (as of March 2015) 13,298 5
AUTOMOTIVE Operations
UMW AUTOMOTIVE DIVISION 51% 38% UMW Toyota Motor Sdn. Bhd.* Investment holding, importation and distribution of Toyota vehicles and related parts Perusahaan Otomobil Kedua Sdn. Bhd.** Investment holding and management services 100% Assembly Services Sdn. Bhd. Assembler of vehicles 100% Perodua Sales Sdn. Bhd. Marketing and distribution of motor vehicles, related spare parts and other related activities 100% Automotive Industries Sdn. Bhd. Manufacturer and supplier of exhaust systems 49% 51% Perodua Auto Corporation Sdn. Bhd. Investment holding 65% Toyota Boshoku UMW Sdn. Bhd. Manufacturer of car seats 49% 51% Perodua Manufacturing Sdn. Bhd. Manufacturer and assembler of motor vehicles 30% UMW Toyotsu Motors Sdn. Bhd. Sales and service of Toyota and Lexus vehicles and parts 49% Perodua Engine Manufacturing Sdn. Bhd. Manufacturer and dealer in component parts including engines, couplings and transmission components 30% Toyota Capital Malaysia Sdn. Bhd. Hire purchase financing of Toyota customers 30% Ingress Technologies Sdn. Bhd. Manufacture complete door assemblies and press parts * ** 39% Toyota Motor Corporation 10% Toyota Tsusho Corporation 20% Daihatsu Motor Co., Ltd 20% MBM Resources Bhd 10% PNB Equity Resource Corporation Sdn Bhd 4.2% Mitsui & Co., Ltd 2.8% Mitsui & Co., ( Asia Pacific) Pte Ltd 5% Daihatsu (Malaysia) Sdn Bhd
TOTAL INDUSTRY VOLUME (TIV) TIV % Change Over Previous Year RHS Total Industry Volume Unit Sales LHS 1,200,000 40% 1,000,000 800,000 600,000 400,000-6.7% 405,745 20.2% 13.3% -0.7% -11.1% 552,316 487,605 490,768 487,176 12.5% -2.0% 548,115 536,905 12.7% -0.8% 4.6% 4.5% 1.6% 655,793 666,465 605,156 627,753 600,123 20% 0% -20% -40% -60% 200,000-80% 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014-100% The TIV for 2014 closed at 666,465 units. MAA s forecast TIV for 2014 was 680,000 units. Target for 2015 is 680,000 units (+2% growth). Lower sales in 2011 was due to the supply-chain disruption caused by the earthquake and tsunami in Japan and the floods in Thailand. 8
LEXUS & TOYOTA Toyota Market Share Of TIV RHS Toyota Unit Sales LHS 200,000 150,000 100,000 50,000 0 18.6% 16.5% 16.7% 16.9% 17.0% 15.6% 15.3% 15.2% 14.8% 14.1% 10.6% 101,839 106,622 103,636 9.9% 91,003 81,808 82,188 82,089 91,990 88,662 92,521 51,700 40,239 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0% Toyota has maintained No. 1 position in non-national segment since year 1990. Official Lexus distributor in Malaysia since 2006. Vios was our top selling model in 2014 with 41% of total sales. Hilux was second with 25%. The new Camry and Hybrid Camry was launched on 2 April 2015. Target for 2015 is 90,000 units. 9
PERODUA Perodua Market Share Of TIV RHS Perodua Unit Sales LHS 350,000 40% 300,000 250,000 200,000 150,000 30.6% 31.7% 33.3% 30.5% 31.1% 31.2% 30.0% 30.1% 30.1% 29.3% 25.0% 25.3% 188,641 189,137 196,071 195,579 179,989 155,419 162,152 167,393 166,736 139,680 124,008 121,804 30% 20% 100,000 50,000 10% 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 0% Perodua maintained the No. 1 position in overall market share since 2006 Currently exporting to seven countries, namely, Indonesia, Singapore, Brunei, Mauritius, Fiji, Sri Lanka and Nepal. Malaysia s first energy-efficient vehicle, Perodua Axia, was launched on 15 September 2014. Target for 2015 is 208,000 units. 10
UMW GROUP S MARKET SHARE Units & Market Share (%) In 2014 Brand 2014 2013 Market Share % Units Market Share % Units 2013 196,071 29.9% Perodua 195,579 29.3% Proton Honda Nissan Hyundai, Kia Volkswagen Others 17.4 11.6 7.0 2.5 1.3 15.3 115,783 77,495 46,352 16,886 8,916 101,818 21.2 7.9 8.1 2.5 1.5 14.9 138,753 51,544 53,156 16,537 9,619 97,592 Total 55.1 367,250 56.0 367,201 2013 92,521 14.1% UMW Toyota 103,636 15.6% Others 367,250 55.1% 2013 367,201 56.0% UMW companies sold 299,215 units in 2014 with a market share of 45%. 11
AUTOMOTIVE DIVISION Model Range Toyota Avanza Toyota 86 Lexus LS 600hL 6 models RM260k-1.0m 200 300 400 500 600 700 800 900 1,000 1,100 12 models RM66k-249k RM 000 60 80 100 120 140 160 180 3 models RM24.6k-64k 20 40 60 80 Perodua Axia Perodua Alza Top Selling Models Perodua - Myvi Toyota - Vios
OIL & GAS Operations
UMW OIL & GAS CORPORATION BERHAD (55.15% subsidiary) Offshore Drilling Workover Oilfield Services Upstream 14
Offshore Drilling UMW DRILLING CO/UMW JDC DRILLING NAGA 1 Company UMW Drilling co-owns semi-submersible drilling rig, NAGA 1, on 50:50 venture with Japan Drilling Company; since 2005. Drilling depth of 30,000 feet Operating water depth of 985 feet Customer Petronas Carigali Sdn. Bhd. since 2005. Status The current contract duration is for five (5) years which commenced on 13 th November 2010 and ends on 12th November 2015, valued at USD250 million. During the period, rig upgrading works were carried out for a duration of 281 days from 13th April 2012 until 18th January 2013. In view of this, the current contract expiry date is therefore extended to 19th August 2016, which represents an additional 281 days, as per the duration of the rig upgrading works. The terms and conditions of the contract however remained the same. In addition, Petronas Carigali has awarded a contract extension for a further period of two (2) years commencing 20th August 2016, valued at USD130 million. 15
UMW OIL & GAS CORPORATION BERHAD - Malaysia s only owner-operator of jack-up drilling rigs. JACK-UP DRILLING RIG CUSTOMER CONTRACT VALUE (USD) CONTRACT DURATION ESTIMATED EXPIRY UMW NAGA 2 PetroVietnam Drilling & Well Services Corp (PV Drilling) 62 million 1 year April 2015 Option to renew UMW NAGA 3 UMW NAGA 4 Japan Vietnam Petroleum Company 105 million 2 year May 2015 PETRONAS Carigali Sdn. Bhd. 157.68 million 3 years April 2016 2-year option for renewal. April 2018 UMW NAGA 5 PTTEP International Limited, Thailand - the rig is operating at offshore Myanmar 51.3 million Five firm wells (about 250 days) June 2015 PetroVietnam Drilling & Well Services Corp (PV Drilling) for end-client Korea National Oil Corporation 18.7 million About 100 days October 2015 UMW NAGA 6 PetroVietnam Drilling & Well Services Corp (PV Drilling) 46.5 million Four firm wells (about 250 days) June 2015 - Optional wells : 3 + 3 UMW NAGA 7 Frontier Oil Corp (Philippines) 20 million 120-day contract UMW NAGA 8 Delivery : September 2015 No contract yet 16
Workover UMW PETRODRIL (MALAYSIA) SDN BHD Company Provides workover related services with hydraulic workover units (HWU) Sole Malaysian owner and operator of HWUs and a PETRONAS licensed HWU services provider. Customer Petronas Carigali Sdn. Bhd. Petrovietnam Drilling & Well Services Corp (PV Drilling) PTTEP International Limited, Thailand Status Currently owns 5 HWUs. HWUs are operating in Malaysia, Vietnam and Thailand. 17
Oilfield Services OCTG Threading, Inspection & Repair Services UMW-OG s OCTG threading, inspection and repair service facilities in Malaysia, Thailand, China and Turkmenistan focus on premium connections. UMW Oilpipe Services Sdn Bhd 2 plants located in Labuan offering premium OCTG threading, inspection and repair services Owner of quality oilfield services assets, including a threading facility in Malaysia with 22 CNC lathe machines Was the first threading plant in Malaysia to be approved in API Q1 and API 5CT specifications Number of threaded joints from 2010 to 2012: 20,942 21,000 13,672 UOT (Thailand) Limited Located in Songkhla and Sattahip, Thailand Focus on repair of damaged threaded pipes and the threading of OCTG and accessories Number of threaded joints from 2010 to 2012 17,208 17,024 16,505 2010 2011 2012 UMW Oilfield Services (Tianjin) Co Ltd Located in Tianjian, China One-stop shop multi premium connection threading base, inspection and related workshop services Received appreciation letter from Schlumberger China and awarded one of the best supplier under Schlumberger s global supplier system in 2012 Unit threaded (connections) from 2010 to 2012 17,299 9,622 11,696 2010 2011 2012 UMW Oilpipe Services (Turkmenistan) Ltd Located in Turkmenbashy, Turkmenistan Provides machine shop services for repair and threading of casing, tubing and oilfield accessories, tubular inspection and hardbanding of drill pipes and collars Mainly supports PETRONAS subsidiary in Turkmenistan s offshore fields in the Caspian Sea. 2010 2011 2012 UMW-OG s operations are pan-asian, with high quality assets characterised by high precision and accuracy capabilities
EQUIPMENT Operations
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 20
Heavy Equipment KOMATSU FRANCHISE Myanmar Malaysia Singapore Papua New Guinea Komatsu franchise in Malaysia, Singapore, Myanmar and Papua New Guinea Market share range from 20% to 43%. Has strong presence in Myanmar, supplying equipment to the jade mining and resource mining sectors. August 2014 Secured contract worth RM200 million to supply more than 60 units of Komatsu equipment in Myanmar. 21
Industrial Equipment TOYOTA FORKLIFT FRANCHISE China Shanghai, Zhejiang Vietnam Malaysia Brunei Singapore Strong market leadership position Globally, UMW is the only Diamond member (the highest elite tier) in the Premier Club Recognition Programme, awarded by Toyota Material Handling International (TMHI). Also awarded the Undisputed Performance Award by Toyota Material Handling International for outstanding performance. Toyota Forklift UMW is one of the Top 5 Distributors in the world. Toyota forklift maintained its 50% market share in Malaysia s material handling equipment business. No. 1 position in Malaysia since 1972. Have ventured into leasing of Toyota forklifts. 22
MANUFACTURING & ENGINEERING Operations
KEY PRODUCTS LUBRICANTS Lubricants & Fluids AUTO COMPONENTS Fluids & Chemicals Lubricants & Fluids (China) Shock Absorbers, Hydraulic Power- Steering Pumps and Systems Auto Components Auto Components 24
Fluid & Chemicals In China LUBRICANT BLENDING PLANT China 中国 JV with Dah Chong Hong (Motor Service Centre) Limited to develop the business of manufacturing/processing of lubricants (the whollyowned subsidiary of Dah Chong Hong Holdings Ltd, a company listed on the HKEx, and principally involved in the motor and motor-related business, foods and consumer products, as well as logistics services) Guangdong Province Plant is in Xinhui, Guangdong Province Started operations in January 2011 Production capacity of 30,000 tonnes (1 shift) and 50,000 tonnes (2 shifts) March 2013 received TS16949 certification the International Quality Management Standard specifically established by the automotive industry. Current customers Repsol, Shell, Petronas, Citgo, GEP and MM Lube Secured new key accounts with First Automobile Works of China (FAW) 25
Auto Components In India MANUFACTURE OF COMPONENTS UMW Dongshin Motech is a major original equipment manufacturer (OEM) for stamped automotive body parts for car manufacturers in India. Pune (Maharashtra) India Chennai (Tamil Nadu) Sathya Auto manufactures mechanical jacks, radiator caps and sheet metal components. Castwel Autoparts manufactures aluminium gravity die castings, aluminium alloys, water pump body, cover and brackets. Our customers in India include General Motors, Volkswagen, Tata, Hyundai. July 2014 Announced proposal to dispose these companies; expected to be completed by 30 June 2015. 26
Manufacturing & Engineering KYB-UMW MALAYSIA SDN. BHD. Shareholding structure. - UMW Corporation Sdn. Bhd. 41.2% - KYB Corporation, Japan 33.4% - UMW Toyota Motor Sdn. Bhd. 21.4% - Toyota Tsusho (M) Sdn. Bhd. 4.0% Incorporated in June 1983. Both OEM and REM supplier. Currently exports to 27 countries. 27
FINANCIAL HIGHLIGHTS
10-YEAR GROUP FINANCIAL HIGHLIGHTS AUTOMOTIVE EQUIPMENT M & E OIL & GAS Revenue (RM million) Profit Before Taxation (RM million) 2,020 15,817 14,959* 12,770 13,536 12,820 13,952 1,621* 9,869 9,950 9,976 10,721 1,277 1,313 1,365 1,436 658 754 856 847 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 *unaudited figures 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Record Year 29
10-YEAR GROUP FINANCIAL HIGHLIGHTS AUTOMOTIVE EQUIPMENT M & E OIL & GAS Total Assets (RM million) Shareholders Funds (RM million) 9,443* 16,440* 14,595 5,721 5,103 6,491 7,828 8,826 10,024 10,541 11,495 2,131 2,342 2,560 3,130 3,522 3,774 4,027 4,249 4,848 6,290 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 *unaudited figures 30
Key Performance Indicators Dividend Policy ANNUAL DIVIDEND PAYOUT, 50% OF PROFIT NET OF UNREALISED GAINS 48.8 50.3 50.8 57.7 59.0 75.8 75.2 58.8 78.7 75.0 Target 50% Payout Ratio (%) 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 50.0 44.0 41.0 Gross Dividend Per Share Of RM0.50 Each (sen) 30.0 37.0 30.0 31.0 19.0 20.5 20.0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 March 08 Share Split from RM1.00 to RM0.50 each 31
Key Performance Indicators Target ROSF RETURN ON SHAREHOLDERS FUNDS 21.9% 12.7% 12.5% 16.5% 17.0% 14% 10.5% 13.5% 11.7% 12.1% 10.0% 10% 10% 10% 10% 10% 10% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Exceeded minimum annual return on shareholders funds In 2008, target was 14%. Achieved 17.0% In 2009, target was 10%. Achieved 10.5% In 2010, target was 10%. Achieved 13.5% In 2011, target was 10%. Achieved 11.7% In 2012, target was 10%. Achieved 21.9% In 2013, target was 10%, Achieved 12.1% In 2014, target was 10%, Achieved 10.0%
AAA CORPORATE CREDIT RATING UMW is rated AAA (Corporate Credit Rating) by RAM Rating Services Berhad (RAM) 33
THANK YOU Dr Wafi Nazrin Abdul Hamid Executive Director Group Management Services UMW Corporation Email: wafi@umw.com.my S. Vikneshwaran Head, Investor & Media Relations Email: vikneshwaran.s@umw.com.my Telephone: +603 5163 5000 Corporate Portal www.umw.com.my This material is proprietary and is prepared specifically for the recipient s reference. The information contained herein is not to be distributed without the consent of UMW Holdings Berhad. Any recommendation or views contained in this document do not have regard to specific investment objectives, financial situation and the particular needs of any specific audience. The content furthermore is believed to be correct at the time of the issue of this document, and is not and should not be construed as an offer or a solicitation of any offer to buy or sell any securities. Nor does this document purport to contain all the information a prospective investor may require.