THP - 2Q13 - Analyst Slides (v1)ir.irchartnexus.com/thplantation/doc/presentation/THP_2Q13_Investo… · Oil Palm Peninsular Sabah Sarawak Total Mature 11,531 7,792 13,549 32,871

1 TH PLANTATIONS BERHAD(Company No: 12696-M)

2nd Quarter 2013Analyst/Investor Briefing20 Aug 20133.00pm

TH PLANTATIONS BERHAD(Company No: 12696-M)

Presented by:Investor Relations


Performance highlights

FFB production: +65% YoY+12% QoQ

CPO production:+52% YoY+13% QoQ

CPO average selling prices:-31% YoY+6% QoQ

EBITDA:-15% YoY

+12% QoQ

Profit After Tax:-55% YoY

+67% QoQ

FFB production: +65% YoY+12% QoQ

CPO production:+52% YoY+13% QoQ

CPO average selling prices:-31% YoY+6% QoQ

EBITDA:-15% YoY

+12% QoQ


+67% QoQ

FFB production: +59% YoY

CPO production:+41% YoY

CPO average selling prices:-33% YoY

EBITDA:-20% YoY


FFB production: +59% YoY

CPO production:+41% YoY

CPO average selling prices:-33% YoY

EBITDA:-20% YoY


2Q 2013 1H 2013


Area Statement

Oil Palm Peninsular Sabah Sarawak Total

Mature 11,531 7,792 13,549 32,871

Immature 7,003 729 18,883 26,615

Total planted 18,533 8,521 32,432 59,486

In course of planting 785 5,518 6,303

Rubber Sabah

Mature -

Immature 1,818

Total planted 1,818

In course of planting 4,364

Mature Oil Palm34%

Immature Oil Palm27%

Immature Rubber

2%

Immature Teak5%

In-course of Planting

11%

Infra & Others 21%

Total land bank: 97,712 Ha


Higher proportion of younger palms

15%

18%

25%

42% Old Mature(20 – 25 years)

Young Mature(4 – 9 years)

Prime Mature(10 – 19 years)

Old Mature( > 25 years)


FFB contribution by region

33%

39%

28%

1H 2013

50%

15%

35%

1H 2012

Peninsular

Sabah

Sarawak

PeninsularSabah

Sarawak

Higher contribution from the Sarawak region following acquisitions made in 2012


A closer look at revenue

Mature Area (ha)23

,158

32,8

71

32,5

40

2Q12 2Q13 1Q13

+42%

FFB Production (MT)

107,

940

177,

766

159,

036

2Q12 2Q13 1Q13

+65%

CPO Production (MT)

21,9

86 33,3

31

29,5

58

2Q12 2Q13 1Q13

+52%

FFB Processed (MT)

108,

461

169,

658

145,

362

2Q12 2Q13 1Q13

+56%

CPO Sales (MT)22

,703 33

,841

32,9

40

2Q12 2Q13 1Q13

+49%

PK Production (MT)

6,06

9

7,91

5

7,38

3

2Q12 2Q13 1Q13

+30%



FFB Yield (MT/ha)

4.66

5.41

4.89

2Q12 2Q13 1Q13

+16%

KER (%)

5.60

4.66 5.08

2Q12 2Q13 1Q13

0.94 ppt

OER (%)

20.2

7

19.6

5

20.3

3

2Q12 2Q13 1Q13

0.62 ppt



Mature Area (ha)23

,158

32,8

71

1H12 1H13

+42%

FFB Production (MT)

212,

331

336,

803

1H12 1H13

+59%

CPO Production (MT)

44,5

92

62,8

89

1H12 1H13

+41%

FFB Processed (MT)

220,

455

315,

019

1H12 1H13

+43%

CPO Sales (MT)

44,7

57 66,7

81

1H12 1H13

+49%

PK Production (MT)

12,8

11 15,2

98

1H12 1H13

+19%



FFB Yield (MT/ha)

9.17

10.2

5

1H12 1H13

+12%

KER (%)

5.81

4.86

1H12 1H13

0.95 ppt

OER (%)

20.2

3

19.9

6

1H12 1H13

0.27 ppt


OER downtrend in 2Q across Malaysia

19.40

19.50

19.60

19.70

19.80

19.90

20.00

20.10

20.20

Jan Feb Mar Apr May Jun Jul2012 2013

20.20

20.40

20.60

20.80

21.00

21.20

21.40

21.60

21.80


19.80

20.00

20.20

20.40

20.60

20.80

21.00

21.20


Peninsular Malaysia Sabah

Sarawak

19.80

20.00

20.20

20.40

20.60

20.80


Malaysia

Source: MPOB


29%

2013RM/Mt

2012RM/Mt

VarianceRM/Mt

PeninsularPeninsular-THPB 2,326.11 3,260.12 (934.01)

Peninsular-MPOB 2,317.50 3,255.50 (938.00)

SabahSabah -Gross 1,949.99 2,902.95 (952.96)

Sabah-MPOB 2,274.50 3,271.00 (996.50)

SarawakSarawak-Gross 1,939.27 - 1,939.27

Sarawak-MPOB 2,299.00 - 2,299.00

29%

33%

30%

Lower revenues mainly driven by prices


Lower revenues mainly driven by prices

2Q13 2Q12

CPO RM2,151 RM3,134

PK RM1,194 RM1,907

FFB RM345 RM568

-31%

-37%

-39%

1H13 1H12

CPO RM2,094 RM3,106

PK RM1,154 RM1,923

FFB RM346 RM573

-33%

-40%

-40%


1,29

5

1,12

5

1H12 1H13

CPO Production Cost (RM/MT)

-13%

Higher efficiency has led to lower production cost/MT

Ow

n FF

B

284

193

1H12 1H13

Estate Production Cost (RM/MT)

-32%

77

72

1H12 1H13

Mill Manufacturing Cost (RM/MT)

-7%

*excl depreciation


A closer look at expenditure

• Admin expenses up by 42% (1H13) and 25% (2Q13)

• Other operating expenses up by 13% (1H13) but lower by 23% (2Q13)

• Finance costs up by 176% (1H13) and 195% (2Q13)

• Fees and expenses relating to acquisitions

• Stamp duty expenses, EGM expenses and donation

• Partially offset by adjustment on fair value of bonus issue

• Higher borrowings to finance acquisitions and others

• Additional RM60mil drawdown in 2Q13

• Estate production cost up by 8% (1H13) and 11% (2Q13)

• Mill manufacturing cost up by 37% (1H13) and 35% (2Q13)

• Depreciation costs up by 33% (1H13) and 34% (2Q13)

• Amortisation costs up by 123% (1H13) and 120% (2Q13)

• Attributed to enlarged land bank and higher production


Overview of Profit & Loss (2Q)

(RM ‘000) 2Q13 2Q12Revenue 95,805 99,352

Sales of CPO 72,809 71,155Sales of PK 9,800 10,987Sales of FFB 9,590 11,281Management fees 3,606 5,929

Cost of Sales (76,811) (67,718)Gross Profit 18,994 31,634Other Expenses (12,785) (8,536)

Admin expenses (4,989) (3,984)Other operating expenses (2,049) (2,550)Zakat - (51)Finance costs (5,748) (1,950)

Other Income 1,221 1,655Profit Before Tax 7,429 24,754Tax 3,037 (1,531)Profit After Tax 10,467 23,222

EBITDA 30,537 35,865Gross Profit before amortisation 32,139 37,602

Revenue down by 4%, mainly due to lower selling prices despite

higher FFB and CPO production

Cost of sales up by 12%, in line with enlarged land bank

Other expenses higher by 50%, due to higher finance costs and

expenses on corporate exercises

EBITDA and gross profit exclamortisation down by 15%, in line

with lower selling prices

Gross profit down by 37%, pulled down by higher amortisation

(RM13m)


Overview of Profit & Loss (1H)

(RM ‘000) 1H13 1H12Revenue 185,258 194,398

Sales of CPO 139,833 138,996Sales of PK 18,973 24,489Sales of FFB 19,136 19,960Management fees 7,316 10,953

Cost of Sales (151,255) (133,130)Gross Profit 34,003 61,268Other Expenses (23,537) (14,454)

Admin expenses (9,565) (6,743)Other operating expenses (3,594) (3,185)Zakat - (762)Finance costs (10,378) (3,764)

Other Income 2,012 3,044Profit Before Tax 12,479 49,858Tax 4,238 (10,889)Profit After Tax 16,716 38,969

EBITDA 57,711 71,793Gross Profit before amortisation 60,627 73,183

Revenue down by 5%, mainly due to lower selling prices despite

higher FFB and CPO production

Cost of sales up by 14%, in line with enlarged land bank

Other expenses higher by 63%, due to higher finance costs and

expenses on corporate exercises

EBITDA down by 20%Gross profit excl amortisation

down by 17%Bottom line impacted by lower

prices as well as higher amortisation and finance costs

Gross profit down by 45%, pulled down by higher amortisation

(RM27m)


Depressed CPO prices continue to impact profits

1H12 PBT

1H13 PBTAmortisationLower

Op ExpPrice OthersProduction

49,858

+43,196 -92,745

+39,976 -14,708

-7,13012,479

Higher production and efficiency substantially offset by lower prices and additional costs


Strategies moving forward

• Develop rubber plantations in FMU area (Sabah)

• Head of Rubber unit recruited

• 6,100 Ha land planted or in course of planting

• 8,300 Ha to be developed over 2014-2016

• Establish refinery (Sarawak)• Target to be

commissioned in early 2016

Diversify Revenue

• Develop and enforce a structured replanting programme

• Develop a centralised and coordinated mechanisationprogramme

• Restructure estates to improve efficiency

• Improve mill process efficiency

• Develop an Integrated Fertiliser Recommendation System

Improve Yield and Profitability

• Enhance performance management process

• Improved L&D strategy and programme

Improve Capability and Productivity


Thank You

Our vision is to be an integrated and sustainable plantation player

with global recognition, promising premium quality products

For further information/queries, please email [email protected]

TH PLANTATIONS BERHAD(Company No: 12696-M)

Documents

THP - 2Q13 - Analyst Slides (v1)ir.irchartnexus.com/thplantation/doc/presentation/THP_2Q13_Investo… · Oil Palm Peninsular Sabah Sarawak Total Mature 11,531 7,792 13,549 32,871