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September 2015
Page(s)
I Overview Organiza7onal Chart 3
Timeline 4
II DMCI Holdings, Inc. Consolidated 5-‐6
III Semirara Mining & Power Corp.:
Coal Mining 7-‐8
Power (on-‐grid) 9
IV Property: DMCI Homes, Inc. 10-‐12
V Construc7on: D.M. Consunji, Inc. 13-‐14
VI Water: Maynilad 15-‐16
VII Power (off-‐grid): DMCI Power Corp. 17-‐19
VIII Nickel Mining: DMCI Mining Corp. 20-‐22
IX Moving Forward: Strategy & Plans 23
X Appendix 1H 2015 Briefing 25
Agenda
2
September 2015
CONSTRUCTION REAL ESTATE
100% 100% 25% 56% 100% 100%
100%
DIVERSIFIED, ENGINEERING-‐BASED CONGLOMERATE
SAN RAFAEL*
NICKEL
50%
40%
100%
2x300MW
2x150MW
2x350MW
OFF-‐GRID POWER COAL & POWER WATER
3 *San Rafael not yet opera7onal
ZAMBALES CHROMITE
ZAMBALES (ZDMC)
BERONG (BNC)
MINDORO
PALAWAN
MASBATE
100%
100%
100% 75%
100%
100%
28 units of diesel
2X6.3 MW bunker & 8 units of diesel
4x3.89 MW bunker
September 2015
1954 Founding of , a general construcEon company
1995 Lis7ng of on the Philippine Stock Exchange
1997 • Acquisi7on of and • Acquisi7on of mark beginning of transforma7on from construc7on firm into diversified engineering-‐based Group
2000 Establishment of , property development arm
2006 DMCI-‐MPIC consor7um (50:50) bids for
2007 • Turnover of opera7ons to DMCI-‐MPIC in January • established aker successful bid to build, operate & own 13MW power plant in Masbate
2009 Acquisi7on of , 2x300MW coal-‐fired power plant
2010 Sale of
2012 • Transi7on from contract-‐miner (nickel) to owner: acquires ENK (Acoje mine, Zambales) and TMC (Berong mine, Palawan) • Incorpora7on of (2x150MW opera7onal by end 3Q 2015) • established.
2013 • Sale of to Marubeni Philippines Corp. (DMCI share: 25%) • wins the bid for 15-‐year PSA in Oriental Mindoro
TIMELINE OF CAPITAL MOVEMENT
4
September 2015
• Net Income up 28% in 1H 2015 versus the same period last year.
6
DMCI HOLDINGS, INC.
Semirara Resources: Coal & Other RESOURCES: Panian 50MT Narra 40MT Himalian 120MT Molave* 90MT Tuong (underground)
12MT ________________ TOTAL RESOURCES 312MT RESERVES: Panian 17MT Narra 70MT Himalian 82MT Molave TBD ________________ TOTAL RESERVES 169MT Other Minerals: Limestone (1.2 billion MT), Clay (2.9 billion MT)
NARRA PIT 70 mil. mt
UNONG PIT 12 mil. Mt ( Depleted )
Total Land Area = 55 sq.km (5,500 hectares)
PANIAN PIT (ACTIVE) 17 mil. Mt Remaining
HIMALIAN 82 mil. mt
Tuong UG 12 mil. mt
Proposed UG
MOLAVE PIT 90 mil. MT*
*Pending verification
September 2015 7 *Molave Mine's coal resource es7mate of 90MT pending verifica7on
September 2015
SEMIRARA: COAL
8
7.1 6.5 7.2 7.6
8.9
4.2
Semirara accounts for 97% of coal production in the Philippines
Market share of power plants increased to 45% of sales volume and 46% of gross revenues in 2015, displacing export sales, due to more reliable performance of Calaca plants
September 2015
SEMIRARA: POWER (On-‐Grid)
•Revenue and Net Income went down in 2014 because of unavailability of Unit 2. •1H 2015 Revenue & Net Income are up & margins have recovered. •We have begun paying regular corporate income tax this year (2015).
9
September 2015
10
PROPERTY DEVELOPMENT • Middle income residential developer: mid-rise and high-rise condominiums
•DMCI Homes exploring new format and product line for faster growth
September 2015
11
• Strong ROE’s reflective of the Company’s synergy with DMCI •Consistent income margins in spite of lower pricing relative to competition
PROPERTY DEVELOPMENT
14,710 17,170 17,060
18,800 20,170
7,540 8,120 9,000 11,700 12,230
2010 2011 2012 2013 2014
Sales Revenue
FINANCIAL HIGHLIGHTS
38%
50% 52% 45% 48%
17% 23% 24% 22%
27%
2010 2011 2012 2013 2014
Gross Proit Margin Net Profit margin
Sales & Revenue (PHP’m) Gross and Net Income Margin
19% 23%
27% 27% 28%
7% 8% 8% 7% 8%
2010 2011 2012 2013 2014
Return on Equity Return on Asset
Return on Equity and Asset
• Rapid sales and revenue growth driven by the Company’s value-for-money philosophy which
• Consistent income margins by effective management of expenses • Improving Return on Equity reflective of the Company’s synergy with DMCI
Almost 35,000 units sold More than 20,000 turned over
•
GP a s apercentage of sale say that in the charts –
why is isincresing becaue you make a correc7on on finished units actual price is lower than your es7mated proice and you add it the oflloing year what you did not spend in previous competed a lot of prjin 2013 adj in costs reflected in a higher margin in the following hyear
September 2015 12
September 2015
CONSTRUCTION
13
• ENGINEERING TALENT with around 700 civil engineers and x number in workforce – capable of taking on complex jobs • ABILITY TO MOBILIZE QUICKLY with size of equipment inventory with over Php 7 billion in inventory • EXCEPTIONAL REPUTATION built up over the past 60 years as AAA contractor. Proven track record in completing projects on time or ahead of schedule.
September 2015
CONSTRUCTION
14
8.6
22.5
15.7 21
18.5
31.7
5.2 10.2
4.6 3.2 3.6 3.4
2.8
1.2
1.5 11 9.8
23.9
0.6 0.5
0.5
0.7 2.9
1.2
-‐
10.6
9.1
6.1 2.2
3.2
0
5
10
15
20
25
30
35
2010 2011 2012 2013 2014 1H 2015
in Php
billions
Order Book Breakdown: EOY 2010 to End of Period 1H 2015
Buildings INFRA Water Power
• Order Book at an all-time high at Php 31.7 billion – up from 18.5 as of EOY 2014
September 2015
MAYNILAD
•In spite of regulatory issues, the Company was able to grow its net income 22% in 1H 2015 from the same period last year.
15
September 2015
MAYNILAD
16
•LARGEST PRIVATE WATER CONCESSIONAIRE in the Philippines in terms of customer base. •NRW at a historic low
ZDMC’s MPSA Area located in the province of Zambales (Region 3)
BNC’ MPSA and Tenement Area located in the province of Palawan (Region 4) LocaEon Area
(Ha) Resource EsEmate (MT)
Reserve, MT
Nickel Grade
Longpoint 2,358 108 No Data 1.1-‐1.8%
Morsoom 5,889 43 No Data 1.0-‐1.5%
Dangla 1,053 118 No Data 1.2-‐1.4%
Berong 288 27 11.6* 1.2-‐1.8%
TOTAL 9,588 296 11.6* 1.0-‐1.8%
LocaEon Area (Ha)
Resource EsEmate (JORC), MT
Reserve, MT Nickle Grade
Municipali7es -‐ Sta. Cruz & Candelaria
3,765 69 29* 0.8-‐2.0%
*(as of August 2015) September 2015 17
GRAND TOTAL
22,941 365 40.6* 0.8-‐2.0%
Berong (BNC) • DMCI Mining took over operations in January 2014 and, since the takeover, the Average Cash Cost has dropped dramatically. •Margins therefore are much higher now (as of 1H 2015) even in the face of weak global commodities prices
September 2015 18
Zambales (ZDMC) •DMCI Mining took over operations in 2013 – but only operated for 4 months • Then, in 2014, the Company operated the mine for only 3 months because of the issuance of a Cease and Desist Order (CDO) • Operations remain suspended in 1H 2015. However, the Company exported inventory
September 2015 19
• In just a matter of five (5) years of operations, DPC has increased its total installed capacity in three major off-grid areas (Masbate, Palawan, Oriental Mindoro) by 300% or from 24.4MW to 74.03 MW.
September 2015 20
DMCI Power: Off-‐Grid
September 2015
MASBATE, PALAWAN & ORIENTAL MINDORO
21
• Increasing energy consumption results in higher power sales & profitability
September 2015
“Revenue stream of DMCI Power’s operations in the Off-Grid areas is assured on a long-term basis”
22
Fuel is “pass-through” “HIGHER CASH MARGINS IN THE OFF-GRID AREAS COMPARED TO GRID”
September 2015 23
Business
Semirara Coal • Verifying resource es7mate in new mine (Molave).
• Poten7al to ramp up produc7on over next 2-‐3 years.
Semirara Power
• 2x150MW expansion expected to be commercially available by last quarter of 2015. The new
plants will run on CFB technology – which make them capable of running on waste-‐coal.
• Another expansion (2x350MW) with a strategic partner planned for end-‐2015 or early 2016.
Property • Expanding product line and developing a new format. Will expand outside Metro Manila.
• Current landbank of 109 hectares good for 4-‐5 years’ worth of projects.
Construc7on
• Poised to benefit directly from implementa7on of PPP projects as Government is likely to
increase spending to 5%-‐6% of GDP.
• Track-‐record capacity to mobilize and engineering exper7se give Company its compe77ve
edge.
Water • Focused on expanding in areas just outside of the West Zone: Laguna, Cavite & Bulacan.
Nickel • Plans to expand permised areas while remaining cost efficient.
Off-‐Grid Power • Well-‐posi7oned to take advantage of suppressed demand in off-‐grid areas;
MOVING FORWARD
Disclaimer • The informa7on contained in this document is strictly confiden7al. Neither DMCI Holdings, Inc.
(DMCI), nor its advisors make any representa7on regarding, and assumes no responsibility or liability for, the accuracy or completeness of, or any errors or omissions in any informa7on contained herein. Such informa7on is subject to change without no7ce, its accuracy is not guaranteed and it may not contain all material informa7on concerning DMCI.
• In addi7on, this document contains certain financial informa7on and results of opera7on, and may
also contain certain projec7ons, plans, strategies, and objec7ves of DMCI, that are not statements of historical fact which would be treated as forward looking statements within the meaning of applicable law. Forward looking statements are subject to risks and uncertain7es that may cause actual events and DMCI’s future results to be materially different than expected or indicated by such statements. No assurance can be given that the results an7cipated by DMCI, or indicated by any such forward looking statements, will be achieved.
• This document is not an offer of securi7es for sale in the United States. Securi7es may not be offered or sold in the United States absent registra7on under the United States Securi7es Act of 1933, as amended (the “Securi7es Act”) or an exemp7on from such registra7on. This document is not an offer to sell securi7es or a solicita7on of an offer to buy securi7es in any jurisdic7on where such offer or sale is not permised.
September 2015 24
ANALYST BRIEFING 1H 2015 Results
Monday, 24 August 2015 Training Room, DMCI Annex 2278 Pasong Tamo, Ext.
September 2015 26
Agenda
• DMCI Holdings’ Share in Net Income • Business Segment 1H 2015 Results:
Semirara Mining & Power Corporation
DMCI Homes (Property) Maynilad DMCI Mining (Nickel) DMCI Power (Off-Grid) D.M. Consunji, Inc. (Construction)
• Parent Balance Sheet
September 2015 27
Holdings’ Share in Net Income Unaudited
(In Million Php) 1H 2015 1H 2014 Change
Semirara (56%) 2,670 1,504 78%
Property Development 1,717 1,653 4%
Maynilad (25%) 1,148 943 22%
Nickel Mining (75%) 454 365 24%
Off-Grid Power 215 125 72%
Construction 333 591 -‐44%
Parent & Others 52 (53) 198%
Net Income 6,589 5,128 28%
September 2015 28
Contribution to Net Income
5%
26%
41%
17%
3% 7%
1% 0%
1H 2015
September 2015
11%
32%
29%
18%
3% 7%
0% 0%
1H 2014
Construc7on
Property
Semirara
Maynilad
Off-‐Grid Power
Nickel
Parent
29
Semirara (Consolidated) Unaudited
(In Million Php) 1H 2015 1H 2014 Change
Revenues 13,717 13,979 -‐2%
COS & Operating Expenses (7,046) (10,174) -‐31%
EBITDA 6,671 3,805 75%
Depreciation & Amortization (1,107) (1,129) -‐2%
Interest Expense (151) (145) 4%
Interest Income 22 24 -‐8%
Other Income (Expense) 182 121 50%
Benefit (Provision) for Income Tax (891) (5) 17,720%
Net Income 4,726 2,671 77%
Net Income for Non-Controlling (2,056) (1,167) 76%
Net Income for DMCI Holdings, Inc. 2,670 1,504 78%
September 2015 30
Semirara (Coal) Unaudited
(In Million Php) 1H 2015 1H 2014 Change
Coal Revenues 6,526 9,051 -‐28%
COS & Operating Expenses (4,582) (5,754) -‐20%
EBITDA 1,944 3,297 -‐41%
Depreciation & Amortization (591) (633) -‐7%
Interest Expense (54) (60) 100%
Interest Income 15 10 50%
Other Income (Expense) 108 89 21%
Benefit (Provision) for Income Tax (2) (2) 0%
Net Income 1,420 2,701 -‐47%
Net Income for Non-Controlling (620) (1,180) -‐47%
Net Income for DMCI Holdings, Inc. 800 1,521 -‐47%
September 2015 31
Semirara Coal Sales 1H 2015 vs. 1H 2014
4.3
1.9 1.9 0.9
1.2
0.5 1.1
0.5
0.6
0.2 0.5
0.2
3.3
1.6
6.6
2.9
0
2
4
6
8
10
Rev. 1H 2015 Vol. 1H 2015 Rev. 1H 2014 Vol. 1H 2014 Revenu
e (billion Ph
p) / Volum
e (m
illion MT)
Power Cement Others Export
September 2015
ASP 2,300
ASP 2,149
32
Semirara (Power) Unaudited
(In Million Php) 1H 2015 1H 2014 Change
Power Revenues 7,191 4,928 46%
COS & Operating Expenses (2,464) (4,420) -‐44%
EBITDA 4,727 508 831%
Depreciation & Amortization (516) (496) 4%
Interest Expense (97) (85) 14%
Interest Income 7 14 -‐50%
Other Income (Expense) 74 32 131%
Benefit (Provision) for Income Tax (889) (3) 29,533%
Net Income 3,306 (30) NM
Net Income for Non-Controlling (1,436) 13 NM
Net Income for DMCI Holdings, Inc. 1,870 (17) NM
September 2015 33
Property Development Unaudited
(In Million Php) 1H 2015 1H 2014 Change
Real Estate Revenues 6,992 6,483 8%
COS & Operating Expenses (4,557) (4,597) -‐1%
EBITDA 2,435 1,886 29%
Depreciation & Amortization (151) (95) 59%
Interest Expense (244) (247) -‐1%
Interest Income 157 76 107%
Other Income (Expense) 256 680 -‐62%
Benefit (Provision) for Income Tax (736) (647) 14%
Net Income 1,717 1,653 4%
Net Income for Non-Controlling – – –
Net Income for DMCI Holdings, Inc. 1,717 1,653 4%
September 2015 34
Property Development Sales and Reservations 1H 2015 vs. 1H 2014
76% 70%
9% 14%
14% 14% 1% 5%
1H 2015 1H 2014
Increase in Bank Financing
Forecast
Cash
In-‐House
Bank Financing
September 2015
(in million Php)
1H 2015 1H 2014 Change
Sales & Reservations
4,689 4,571 3%
Total P10,441 P10,075 4%
35
Higher Bank-Financing = Lower Risk
33%
48%
32% 25%
13% 7%
49%
37%
55% 62%
72% 79%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
2010 2011 2012 2013 2014 2015
Percen
tage of S
ales per Year
Bank Financing On the Rise: 2010-‐2015
IN-‐HOUSE
BANK
September 2015 36
Maynilad Holdings Unaudited
September 2015
(In Million Php) 1H 2015 1H 2014 Change
Revenues 9,336 8,996 4%
COS & Operating Expenses (2,384) (2,759) -‐14%
EBITDA 6,952 6,237 11%
Depreciation & Amortization (1,285) (1,169) 10%
Interest Expense (1,050) (1,085) 3%
Interest Income 60 56 7%
Other Income (Expense) (285) (427) -‐33%
Benefit (Provision) for Income Tax 156 124 26%
Net Income 4,548 3,736 22%
Net Income for Non-Controlling (325) (267) 22%
Net Income for Maynilad Holdings 4,223 3,469 22%
Net Income for DMCI Holdings, Inc. 1,148 943 22%
37
Maynilad Operating Performance 1H 2015 vs 1H 2014
0
50
100
150
200
250
300
350
400
1H 2015 1H 2014
32.3 34.4
238.53 229.52
352.34 349.72
NRW %
Billed Volume (MCM)
Water Supply (MCM)
September 2015 38
Nickel Mining Unaudited
(In Million Php) 1H 2015 1H 2014* Change
Nickel Ore Revenues 2,166 212 922%*
COS and Operating Expenses (912) (209) 336%
Equity in Net Earnings – 206
EBITDA 1,254 209 500%
Depreciation & Amortization (274) (58) 372%
Interest Expense – – NM
Interest Income 1 – NM
Other Income (Expense) (52) 190 -‐127%
Benefit (Provision) for Income Tax (309) 28 -‐1,204%
Net Income 620 369 68%
Net Income for Non-Controlling (166) (4) –
Net Income for DMCI Holdings, Inc. 454 365 24% September 2015 39
Off-Grid Power Unaudited
(In Million Php) 1H 2015 1H 2014 Change
Power Revenues 1,077 889 21%
COS and Operating Expenses (787) (701) 12%
EBITDA 290 188 54%
Depreciation & Amortization (61) (45) 36%
Interest Expense (5) (1) 400%
Interest Income – – NM
Other Income (Expense) 6 – NM
Benefit (Provision) for Income Tax (15) (17) -‐12%
Net Income 215 125 72%
Net Income for Non-Controlling – – –
Net Income for DMCI 215 125 72%
September 2015 40
Construction Unaudited
(In Million Php) 1H 2015 1H 2014 Change
Construction Revenues 6,369 7,752 -‐18%
COS and Operating Expenses (5,548) (6,620) -‐16%
EBITDA 821 1,132 -‐27%
Depreciation & Amortization (409) (397) 3%
Interest Expense (23) – NM
Interest Income 2 16 -‐88%
Other Income (Expense) 58 7 729%
Benefit (Provision) for Income Tax (116) (167) -‐31%
Net income 333 591 -‐44%
Net Income for Non-Controlling – – 0
Net Income for DMCI Holdings, Inc. 333 591 -‐44%
September 2015 41