ANALYSTS’BRIEFING News Materials/MAC...ANALYSTS’BRIEFING Highlights of 2017 Operations March 22, 2018 Penthouse, PNB Allied Bank Center 6754 Ayala Avenue, Makati City Philippines

ANALYSTS’BRIEFING

Highlights of 2017 OperationsMarch 22, 2018

Penthouse, PNB Allied Bank Center6754 Ayala Avenue, Makati City

Philippines

DISCLAIMER

By accepting this material, you acknowledge, understand and accept the following:

1. This material has been prepared for information and illustrative purposes only, and maybe subject to change without notice, as operating conditions ofthe Company are never constant;

2. This material may contain statements derived from historical information, projections, forward looking statements or expectations as currently assessedunder prevailing conditions which at some point in the operations of the Company may change. Actual results could differ materially from thoseexpressed or implied in this material. Important factors that could make a difference to the Company’s operations include, among others, the economicconditions affecting aviation travel, demand/supply and price conditions in the local and global markets which affect the businesses of the Company,changes in Government regulations, tax laws, and other statutes and incidental or extraneous factors beyond control of the Company; and

3. This material is not, and should not be regarded as “investment advice” or as a “recommendation” regarding a course of action, including withoutlimitation as to those terms that are used in any applicable law or regulation;

4. This material is provided with the understanding that with respect to the data provided herein, the Company or its representative is not acting in afiduciary or advisory capacity under any contract with the recipient of the information. Any course of action in connection herewith or arising from thismaterial, as to whether such course of action is appropriate or proper is the responsibility of the recipient of this material, based on the recipient’s ownjudgment and independent assessment of the data contained

5. No part of this document may be reproduced, altered or modified in any manner, in whole or in part, without the written permission of MacroAsia.

For more information, please contact: MacroAsia Corporation12th Floor PNB Allied Bank Center6754 Ayala Avenue, Makati City, 1226Philippines Tel No. (+63 2) 840 2001

Investor RelationsGladys Lorraine P. SalamatinEmail: [email protected]

Kyle Jemmric L. VelascoEmail: [email protected]

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AGENDA

3

Key Points

Growing Under The Spotlight

Getting Bigger

Standing On Solid Ground

Moving Forward To Higher Ground

KEY POINTS

A. MAC GETS BIGGER!Our core business units continue to drive solid growth.

B. MAC RESTS ON SOLID GROUND!A healthy balance sheet keeps well-supported the continuing or newexpansion projects

C. MAC IS POISED FOR FOCUSED-GROWTH IN A SUNRISE INDUSTRY, EVEN BEYOND BORDERS!

We see MAC’s growth trajectory to be well-supported by current operating indicators in Q1 2018. Ongoing projects ensure sustainability and growth.

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GROWING UNDER THE SPOTLIGHT

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PSE SECTOR INDEX: SERVICES

Name of Listed Company Symbol

Last

Trade

Price

(03/9/18)

Outstanding Shares Float %Free Float Market

Capitalization%Weight

1 PLDT Inc. TEL 1,521.00 216,055,775 50 164,310,417,648.00 27.58

2 INTERNATIONAL CONTAINER TERMINAL SERVICES, INC. ICT 108.90 2,035,470,209 51 113,047,979,982.30 18.98

3 BLOOMBERRY RESORTS CORPORATION BLOOM 14.32 11,001,717,025 34 53,565,159,858.48 8.99

4 GLOBE TELECOM, INC. GLO 1,669.00 132,916,585 22 48,804,312,181.00 8.19

5 PUREGOLD PRICE CLUB, INC. PGOLD 53.35 2,765,381,406 33 48,685,922,344.40 8.17

6 ROBINSONS RETAIL HOLDINGS, INC. RRHI 84.60 1,385,000,000 38 44,524,980,000.00 7.47

7 Golden Bria Holdings, Inc. HVN 318.00 644,117,649 16 32,772,706,032.00 5.50

8 CEBU AIR, INC. CEB 99.00 605,953,330 33 19,796,495,301.00 3.32

9 MELCO RESORTS MRP 7.60 5,666,764,407 27 11,628,200,564.00 1.95

10 ABS-CBN CORPORATION ABS 28.80 862,192,581 43 10,677,392,928.00 1.79

11 MACROASIA CORPORATION MAC 26.95 1,227,154,400 26 8,598,670,880.80 1.44

12 Premium Leisure Corp. PLC 1.13 31,627,310,000 21 7,505,160,663.00 1.26

13 LEISURE & RESORTS WORLD CORPORATION LR 7.06 1,199,852,512 64 5,421,413,592.48 0.91

14 STI EDUCATION SYSTEMS HOLDINGS, INC. STI 1.48 9,904,806,924 36 5,277,281,129.64 0.89

15 GMA NETWORK, INC. (COMMON) GMA7 6.30 3,361,047,000 24 5,081,903,064.00 0.85

16 Metro Retail Stores Group, Inc. MRSGI 3.30 3,429,375,000 26 2,942,403,750.00 0.49

17 NOW CORPORATION NOW 9.87 1,517,278,350 19 2,845,352,094.69 0.48

18 SSI Group, Inc. SSI 2.63 3,312,524,430 30 2,613,581,775.27 0.44

19 PHILWEB CORPORATION WEB 6.90 1,435,626,680 26 2,575,514,265.30 0.43

20 IPM HOLDINGS, INC. IPM 8.28 690,000,000 32 1,828,224,000.00 0.31

21 HARBOR STAR SHIPPING SERVICES, INC. TUGS 5.36 907,857,870 32 1,557,157,821.84 0.26

22 WATERFRONT PHILIPPINES, INC. WPI 0.90 2,498,991,753 53 1,192,019,067.00 0.20

23 BOULEVARD HOLDINGS, INC. BHI 0.06 12,000,000,000 56 430,080,000.00 0.07

From February 2017, MAC has invited analysts, fund managers and investors to visit operating facilities for the public to have an awareness of MAC’s business.

An Investors’ Relations Office has been formalized for easier access to corporate information.

By February 2018, MAC has become part of PSE’s Services Sector Index.


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MAC has beenrecognized as amongthe best by its airlineclients from all over theworld. Its catering andground handling unitshave been receivingawards from airlines.Its MRO JV has beensuccessful in competingon the global basemaintenance market. Italso helps that LTP ispart of the establishedand wide MROnetwork of Lufthansa.

GETTING BIGGER

MAC Group financial results point to sustainable top-line and bottom-line performance.

8

Aircraft Maintenance, Repair and Overhaul (MRO), Food Services (inflight and non-inflight food) and Gateway Services (Groundhandling) consistently deliver growing results.

1,723

240 122

1,921

456 341

2,335

668 440

2,939

1,336 1,081

-

500

1,000

1,500

2,000

2,500

3,000

3,500

Total Revenues EBITDA Net Income

THE GROWTH STORY CONTINUES...

2014 2015 2016 2017

+12%

+22%

+26%

+180%

+29%

+146%

+90%

+46%

+100%

in PHP millionsCONSOLIDATED P&L HIGHLIGHTS

Lufthansa Technik Philippines

(LTP)

Maintenance, Repair and Overhaul Services

(Biggest MAC investment, 49% ownership by MAC)

9

7,740.8

9,653.4

12,827.5

2015 2016 2017

Revenues (PHP millions)


699.3

1,014.0

2,040.3

9%

11%

16%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

.

500.

1,000.

1,500.

2,000.

2,500.

2015 2016 2017

Operating income (PHP millions) and margin (%)

CAGR = 28.7% CAGR = 70.8%

10LTP’s earns in USD and reports in USD.


582.9

1,014.8

1,893.4

8%

11%

15%

0%

2%

4%

6%

8%

10%

12%

14%

16%

.

200.

400.

600.

800.

1,000.

1,200.

1,400.

1,600.

1,800.

2,000.

2015 2016 2017

Net Income (PHP millions) and margin (%)

CAGR = 80.2% Year ROE

2015 31%

2016 34%

2017 45%

Margins continue to increase due to

continuing growth in line maintenance

and base maintenance activities, while

control in operating costs have been

sustained through various programs.

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• In 2017, traffic volume

resulted into more

flights of line

maintenance clients

• PALEx fleet of six (6)

A321 planes were

transferred for line

maintenance with LTP

in Oct 2017

• PAL fleet increased in

mid-December with 2

new B777Line Maintenance revenues of

USD70m is 46% of core

revenues: 4% increase in 2017


• Strong third-party business (65% of BM revenues), especially in the A380 layovers (50th A380 event since 2012 was marked in 2017 (Qantas A380)

• Support for PAL’s “Get That 5-Star” Initiative translated into cabin refurbishment work

Base Maintenance of USD83m is

54% of core revenues: 10%

increase in 2017

MacroAsia Catering Services

(MACS)

Airline Catering, Institutional Catering and Food

Service Management

(67%-owned by MAC, 33% by SATS of Singapore)


60%

28%

12%

MACS MCSC Others

Foreign Airline

Market Share

(%, based on

flight

movement)• 28 Apr 2017 : Acquisition of Xiamen Air account (A320, daily to Xiamen)

• 26 May 2017 : Acquisition of Lucky Air account (A320, daily to Kunming (suspended flights since Nov 2017 due to slot issues in NAIA)

MACS operates in NAIA, in a 2-hectare leased area. MACS is the preferred caterer of foreign airlines. PAL inflight meals are not being provided by MACS (only Mabuhay lounge meals). MACS also runs institutional kitchens outside NAIA (e.g., ADB, BPI).


7,9299,002 8,961

8,207 8,243

10,04010,823

1,131 2,3733,650

4,885 3,858

2011 2012 2013 2014 2015 2016 2017

Average Daily Meals

In-Flight Institutional

7,9299,002

10,09210,580

11,893

14,926 14,681CAGR = 10.8%

+8%

Core inflight meal

business grew by 8% but

non-airline meal business

slowed down in 2017.

Marketing for non-airline

meals being produced inside

the NAIA kitchen was

constrained by facility

issues. This has been

resolved by repair works in

2017 and production

capacity will also be

expanded when the MSFI

facility is completed by 1H18

Last provision for Okada

meals was in Jan 31, 2017.

Replacement client was not

pursued. BPI 1851 Club was

serviced in July 2017


1,168.8

1,446.4

1,541.0

2015 2016 2017

Revenues (PHP millions)

CAGR = 14.8%

91.4

276.6

219.68%

19%

14%

0%

5%

10%

15%

20%

25%

0.0

50.0

100.0

150.0

200.0

250.0

300.0

2015 2016 2017

Operating income and margin (%)

CAGR = 55.0%

+7%

Service fees being charged by MAC & SATS increased in 2017 from 5% of net sales to 7.5% of net sales


115.3

241.8 250.3

10%

17%

16%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

0.0

50.0

100.0

150.0

200.0

250.0

300.0

2015 2016 2017

Net income and margin before Service Fee (millions Php, %)

CAGR = 47.4%

+4%


60.9

174.5

142.95%

12%

9%

0%

2%

4%

6%

8%

10%

12%

14%

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

180.0

200.0

2015 2016 2017

Net income and margin(millions Php, %)

CAGR = 53.2%

Year ROE

2015 15%

2016 33%

2017 23%

• Lower 2017 net income is mainly due to the increase in service fees to MAC & SATS (PHP40m increase).

• Provisions for Input VAT claims was also made (PHP12m).

• 2016 was a high base due to institutional clients. Slowdown in non-airline marketing was done in Q4 2017 to enable refurbishment and repair work in the 20-yr old inflight kitchen.


0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

MACS Volume Developments

Meal Volume

Volume of meals is expected to grow further after MSFI facility is completed this 2018.

Facility challenges were faced in 2017 for the 20-yr old kitchen that has been opened for 24/7 ever since it started in 1998.


A Preferred-VVIP Caterer

2017 ASEAN Summit

• Brunei

• Cambodia

• India

• Laos

• Russia

• South Korea


Royal Brunei Airlines (BI)

• 1st catering provisioning, Feb. 01, 2018

China Eastern (Shanghai)

• 1st catering provisioning, Mar. 25, 2018

2018 Inflight Meals Growth:


Expanding Production Capacity In 2018

• MSFI Facility in Sucat: slated for operations by 2H 2018

MacroAsia Catering ServicesExpanding Production Capacity In 2018



Expanding Production Capacity In 2018


MacroAsia Service

Corporation (MASCORP)

Gateway Services, Ground Handling

(100% MAC)

MacroAsia Airport Services Corporation

33.5

69.5

105.0

6%

10%10%

0%

2%

4%

6%

8%

10%

12%

.

20.

40.

60.

80.

100.

120.

2015 2016 2017

Operating income and margin (millions Php, %)

516.9

678.8

1,032.4

2015 2016 2017

Revenues (millions Php)

CAGR = 77.2% CAGR = 41.3%

+52%+51%


18.8

46.4

71.24%

7%7%

0%

1%

2%

3%

4%

5%

6%

7%

8%

.

10.

20.

30.

40.

50.

60.

70.

80.

2015 2016 2017

Net income and margin (millions Php, %)

CAGR = 94.5%

Year ROE

2015 11%

2016 22%

2017 26%

• Net income increased mainly due

to increase in flights handled in

more number of airports served

• Efficiencies in operations have

not been achieved, as it requires

time for new GH locations to

stabilize

+53%


From 7 stations in 2016 to

27 stations in

2017

LUZON VISAYAS MINDANAO

Basco Tacloban Dipolog

Laoag Kalibo Zamboanga

Tuguegarao Roxas General Santos

Clark Cebu Davao

Manila – NAIA 1, 2, & 3 Iloilo Surigao

Naga Bacolod Butuan

Legazpi Cotabato

Busuanga Cagayan De Oro

Puerto Prinsesa Camiguin

Masbate Siargao

Virac*Excluding the PALexSatellite Cargo


17%

17%

3%55%

8%

Manila Market Share

MASCORP

Sky Logistics

PAL Express

MIASCOR

Others

Cebu Pacific is

a MIASCOR

Client

KEY CURRENT MARKET

DEVELOPMENTS:

• Winding down of Miascor

groundhandling operations has

resulted into its clients looking

for new providers.

• Following the news of Miascor’s

closure, Cebu Pacific has

formed its subsidiary 1Aviation

Groundhandling Services

Corporation (new player in

aviation services)

Continuing Growth In 2018

• Number of airports where MASC will be present will reach 30

New airports include:

• Sibulan Airport (Dumaguete)

• Labo Airport (Ozamiz)

• Tagbilaran Airport (Bohol)

• New clients (MIASCOR accounts):

• Manila• Jetstar Japan - March 19

• Jeju Air - March 19

• Kuwait Airways - March 20

• Turkish Airways - April 19

• MASCORP to operate in new Terminal 2 of Cebu Airport


• Cebu• Jeju Air - April 1

STANDING ON SOLID GROUND

BALANCE SHEET HIGHLIGHTS(in PHP millions)

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As of End: 2017 2016 Inc (Dec) % ChangeCash 1,005.3 559.7 445.6 79.6%Total Assets 6,610.1 4,796.3 1,813.8 37.8%Total Loans 720.3 187.8 532.5 283.6%Total Liabilities 1,988.4 961.0 1,027.4 106.9%Total Equity 4,621.7 3,835.5 786.2 20.5%D-E Ratio 43% 25%

Book Value per Share 3.8 3.1Earnings per Share 0.85 0.32

STANDING ON SOLID GROUND

CONSOLIDATED INCOME STATEMENT HIGHLIGHTS(in PHP millions)

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Audited(In Php Millions)

2017 2016 Increase/

(Decrease) %

NET SERVICE REVENUE

In-flight and other catering 1,541.5 1,446.4 95.2 7%

Ground handling and aviation 1,032.4 678.8 353.7 52%

Rental and administrative 197.2 188.8 8.4 4%

Charter flights 0.0 11.8 -11.8 -100%

Water 140.4 6.3 134.1 2144%

Exploratory drilling fees 27.3 3.0 24.3 811%

TOTAL REVENUES 2,938.9 2,335.0 603.9 26%

DIRECT COSTS 2,134.2 1,660.5 473.7 29%

GROSS PROFIT 804.7 674.4 130.2 19%

SHARE IN NET EARNINGS OF ASSOCIATES 968.3 532.4 435.8 82%

TOTAL INCOME 1,773.0 1,206.9 566.1 47%

OPERATING EXPENSES -619.9 -713.2 93.3 -13%

INTEREST INCOME 6.0 7.0 -1.0 -14%

FINANCING CHARGES -8.3 -3.3 -5.0 152%

OTHER INCOME - net 44.4 75.1 -30.7 -41%

INCOME BEFORE INCOME TAX 1,195.2 572.5 622.7 109%

PROVISION FOR INCOME TAX 114.2 132.4 18.2 -14%

NET INCOME 1,081.0 440.2 640.9 146%

Attributable to:

Equity holders of the Company 1,038.5 389.0 649.6 167%

Non-controlling interests 42.5 51.2 -8.7 -17%

NET INCOME 1,081.0 440.2 440.2 100%

2017 2016

EPS 0.85 0.32

EBITDA 1,366.0 667.5

EBITDA Margin 46% 29%

Net Margin 37% 19%

MOVING FORWARD TO HIGHER GROUND

SOME CURRENT COMPANY DEVELOPMENTS

a) ENHANCING FOCUSED-GROWTH:

Transfer of water subsidiaries from MacroAsia Properties Development Corporation to another holding company under control of MacroAsia Corporation

b) REVISITING COMPANY CAPITAL AND EARNINGS RETAINED:Declaration of 30% Stock Dividends (about 368 million shares)

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OUTLOOK AND GUIDANCE:

KEEPING THE 20% BOTTOMLINE GROWTH AS 2018 TARGET FOR NOW.

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SOME INDICATORS FOR 2018:

• From PHP905M capex spending in 2017, the MAC Group is allocating PHP2.6B for capex to expand (excluding investments to be allocated for M&Atransactions). Of this PHP2.6B budget, PHP1.9B is for aviation-services related businesses. No capital call is being eyed for these requirements.

• Several new foreign clients in ground handling and catering are already secured for servicing this 1H2018.

• More synergies are being eyed between MAC Group and PAL (MRO, Catering, Ground Handling).

• Line Maintenance Contract has been awarded by PAL on 25 Jan 2018 to LTP for the new A321neo/A350 planes (contract duration of 12 years).

• More than 50% of MRO base maintenance slots for 2018 are already secured. Last February 7, 2018, LTP and Asiana Airlines signed a five-year agreement for base maintenance from 2018 to 2022, for a total of 14 checks on Asiana’s A380s (6 A380s at present).

• LTP identified two areas of possible hangar locations within its current NAIA location (MacroAsia Special Ecozone). MacroAsia Catering will have its capacity expanded through the MSFI facility and the development of certain areas in its current location.

• Cebu development project (MacroAsia leased areas) is ongoing.

• Pilot school (FAA) is targeted to be operational by 2H2018. MSFI (institutional catering is targeted to be operational by 2H2018. Water projects continue to be developed.

• While the MAC Group continues to grow in other areas in the Philippines., authority was granted for Management to study business expansion outside the Philippines.

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Q&A

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ANALYSTS’BRIEFING News Materials/MAC...ANALYSTS’BRIEFING Highlights of 2017 Operations March 22, 2018 Penthouse, PNB Allied Bank Center 6754 Ayala Avenue, Makati City Philippines