UMW Holdings Bhd - ir.chartnexus.comir.chartnexus.com/umw/doc/media/UMW Corporate Presentation Website... · Exporting to 6 countries - Indonesia, Singapore, Mauritius, Fiji, Sri

1UMW HOLDINGS BERHAD

UMW Holdings BerhadCorporate presentation

March 2019

Beyond Boundaries

INTRODUCTION


OUR JOURNEY

Enhancing our capabilities

Founded in 1917 Automotive Assembly Aerospace

Bicycle repair shop >37 years with Toyota

>26 years with Daihatsu

Fan Case Manufacturer

for Rolls-Royce

Tier 1 supplier

Laying the building blocks for excellence

UMW HOLDINGS BERHAD

Equipment Distribution

>50 years with Komatsu

>50 years with TICO


59.47%

6.27%

6.25%17.93%

10.08%

OUR SHAREHOLDERS

As at 28 February 2019

28/02/2019

Market Capitalisation

RM6.8b

PNB

EPF

Other Local Shareholders KWAP

Foreign Shareholders

▪ Permodalan Nasional Berhad & PNB

Managed Unit Trust Funds, 59.47%

▪ Employees Provident Fund Board,

10.08%

▪ Foreign Shareholders, 6.27%

▪ Other Local Shareholders, 17.93% ▪ Kumpulan Wang Persaraan

(Diperbadankan), 6.25%

UMW HOLDINGS BERHAD


OVERVIEW OF OUR BUSINESSES

• Manufacture

• Assembly

• Distribution

• Sales & service

Automotive Equipment M&E Others

• Distribution

• Trading

• Leasing

• After-sales

service

• Manufacture of

fan case

• Manufacture of

automotive

components

• Blending &

distribution of

lubricants

• Unlocking value

of the land in

Serendah


INTERNATIONAL PRESENCE

8 countries

China

Malaysia

Indonesia

Myanmar

Brunei

Papua

New Guinea

Singapore

Automotive

Equipment

Manufacturing & Engineering

Vietnam

8,301▪ Employees

AA2▪ RAM

▪ Credit Rating

UMW HOLDINGS BERHAD

AUTOMOTIVE


UMW AUTOMOTIVE SEGMENT

UMW Toyota Motor

Sdn. Bhd.*

Manufacturer and dealer in

component parts including

engines, couplings and

transmission components

Perodua Engine Manufacturing

Sdn. Bhd.

Perodua Manufacturing

Sdn. Bhd.

Perodua Sales

Sdn. Bhd.

30%

Toyota Boshoku

UMW Sdn. Bhd.

Automotive Industries

Sdn. Bhd.

Assembly Services

Sdn. Bhd.

Perusahaan Otomobil Kedua

Sdn. Bhd.**

Manufacturer and assembler

of motor vehicles and other

related activities

Investment holding and

provision of management and

administrative services

Marketing and distribution of motor

vehicles, related spare parts and

other related activities

Manufacturer of car

seats, door trims,

headlining, etc.

Manufacturer and

supplier of exhaust

systems

Assembler of

vehicles

Ingress Technologies

Sdn. Bhd.

Manufacturer of complete door

assemblies and press parts

UMW Toyotsu Motors

Sdn. Bhd.

Sales and service of

Toyota and Lexus

vehicles and parts

65%

100%

100%

49%

49%

49%

100%

30%

Investment holding,

importation and distribution

of Toyota vehicles and

related parts

Investment holding and

provision of management and

administrative services

39% Toyota Motor Corporation10% Toyota Tsusho Corporation

4.2% Mitsui & Co., Ltd2.8% Mitsui & Co., ( Asia Pacific) Pte Ltd5% Daihatsu (Malaysia) Sdn Bhd

30% Toyota Capital Malaysia

Sdn. Bhd.

Hire purchase

financing of Toyota

customers

*

51% 38%

51%

51%

******* 41% Daihatsu Motor Co., Ltd6% Mitsui Co., Ltd 4% Mitsui & Co., ( Asia Pacific) Pte Ltd

20% Daihatsu Motor Co., Ltd20% MBM Resources Bhd10% PNB Equity Resource

Corporation Sdn Bhd

**

Perodua Global Manufacturing

Sdn. Bhd.49%

51%

Daihatsu Perodua Engine

Manufacturing Sdn. Bhd.

49% 51% Daihatsu Motor Co., LtdManufacturer of engine and engine components for Energy Efficient Vehicles

Manufacturer and assembler

of motor vehicles and other

related activities

Perodua Auto

Corporation Sdn. Bhd.***


548,115 536,905

605,156 600,123627,753

655,793 666,465 666,674

580,124 576,625598,714

12.5%

-2.0%

12.7%

-0.8%

4.6% 4.5%1.6% 0.0%

-13.0%

-0.6%

3.8%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

-100,000

100,000

300,000

500,000

700,000

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Unit sales % Growth Year-on-Year

TOTAL INDUSTRY VOLUME (TIV)

2019 target - 600,000 units (0.2% YoY)

▪ 2018 car sales saw a growth of 3.8% year-on-year with 598,714 units sold, exceeding

MAA’s revised target of 585,000 units. The 2018 TIV growth marks the end of two

consecutive years of sales decline.

▪ Sales improved substantially during the three-month GST-free period.

▪ MAA is forecasting a flat TIV growth in 2019, with a sales target of 600,000 units.

Source: Malaysian Automotive Association


101,839

82,08991,990 88,662

106,622

92,521

103,63695,861

65,11070,445 66,562

18.6%

15.3% 15.2% 14.8%17.0%

14.1%15.6%

14.4%

11.2% 12.2%11.1%

-20.0%

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

-10,000

30,000

70,000

110,000

150,000

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Unit sales Market Share

UMW TOYOTA MOTOR (UMWT) UNIT SALES

2019 sales target - 75,000 Units (13% YoY)

▪ Distributes 6 CKD and 8 CBU Toyota models. Lexus models are all CBU.

▪ Importation of CBU cars and CKD components are transacted in US Dollar.

▪ All-new models launched in late 2018 – Toyota Rush (October) and Toyota Camry

(November).

▪ As a result of the run-out of Vios towards the end of 2018, UMWT sold 66,562 units

during the year. Delivery of Rush started in Feb 2019 despite the launch in Oct 2018.



167,393 166,736188,641 179,989 189,137 196,071 195,579

213,307 207,110 204,887227,243

30.5% 31.1% 31.2%30.0% 30.1% 29.9% 29.3%

32.0%

35.7% 35.5%38.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Unit sales Market Share

PERODUA UNIT SALES IN 2018

2019 sales target - 231,000 Units (2% YoY)

*


▪ Perodua exceeded its 2018 target with a record breaking sales of 227,243 units and

maintained its No.1 position in overall market share for the 13th consecutive year. The

all-new Myvi (launched in Nov 2017) was the best-selling model.

▪ Exporting to 6 countries - Indonesia, Singapore, Mauritius, Fiji, Sri Lanka and Brunei.

▪ Order taking for the new 7-seater SUV, Perodua Aruz started on 2 Jan 2019, with

monthly sales target of 2,500 units.


2018: UMW GROUP’S MARKET SHARE

Units & Market Share (%)

38.0%11.1%

50.9%

Brand 2018 2017

Units Market

Share %

Units Market

Share %

Honda

Proton

Nissan

Mazda

Others

102,282

64,744

28,610

16,038

93,235

17.1

10.8

4.8

2.7

15.6

109,511

70,991

27,154

9,730

75,676

19.0

12.3

4.7

1.7

13.1

Total TIV 598,714 576,635

2017

204,887

35.5%

2017

70,445

12.2%

2017

301,303

52.3%

Perodua

227,243 UMW Toyota

66,562

Others

304,909


Other Carmakers’ Sales and Market Share

UMW HOLDINGS BERHAD

• UMW Group sold 293,805

units in 2018 with a market

share of 49.1% (2017 – 47.7%)

EQUIPMENT


EQUIPMENT SEGMENT

▪ Agriculture

▪ Construction

▪ Forestry

▪ Mining

▪ Industrial and manufacturing

▪ Industrial cleaning – food and beverage, material handling and logistics

▪ Industrial and marine power solutions

UMW represents all of the above principals for some of the world’s most recognised products in:

HEAVY

EQUIPMENT Material handling Marine & Power

INDUSTRIAL EQUIPMENT


Heavy Equipment

UMW Komatsu Heavy Equipment Sdn Bhd

UMW Corporation

(74%)

Komatsu Ltd

(26%)Joint venture

effective

1 October 2018

Myanmar

Papua New Guinea

Malaysia

Singapore

Since 1965

Brunei

Since 1979

Since 1996

Principal-distributorship relationship

between UMW and Komatsu began

1965

Oct 2018

Joint-venture agreement between

UMW and Komatsu begins

Also distributes:


Industrial Equipment

Material Handling

Toyota Forklift Franchise

Malaysia

Vietnam

Brunei

Singapore

China :

Shanghai,

Zhejiang

▪ No. 1 position in Malaysia since 1972. Toyota forklift maintained its 50% market share in Malaysia’s material

handling equipment business.

▪ Toyota Forklifts – UMW is one of the Top 10 Distributors in the world.

▪ 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.

▪ Have ventured into leasing of Toyota forklifts.

Strong market leadership position

Since 1967


Industrial Equipment

Marine & Power

Compressors Generators

Oil spill equipmentMarine engines

MANUFACTURING

& ENGINEERING


MANUFACTURING & ENGINEERING SEGMENT

Key Products

Aerospace Component

Lubricants

Auto Components

Aero

Engine

Fan

Cases

Lubricants &

Fluids

Fluids &

Chemicals

Lubricants &

Fluids

(China)

Shock

Absorbers

Automotive

Components

• Grantt lubricants, UMW’s in-house brand was

launched in 2015

• Grantt lubricants are distributed in 9 countries, ie:

Malaysia, Singapore, Brunei, the Philippines,

Cambodia, Vietnam, Indonesia, Thailand and China.

UMW is the largest distributor of Repsol

lubricants outside Spain, mainly driven by

strong sales in China


MANUFACTURING & ENGINEERING SEGMENT

Manufacture of Aero Engine Fan Cases

• The contract is for the manufacture of fan cases for the

Trent 1000 aero engines for 25+5 years (Trent 7000

engines later) for Rolls-Royce.

• Both Trent engines are the most advanced in aero engine

technology, with increased fuel efficiency and noise

reduction.

• UMW will be the only supplier (‘single-source supplier’) for

fan cases for both the engines.

• The manufacturing plant is located in Serendah, Selangor.

• Successfully delivered the first fan case on 29 November

2017. Started generating revenue in 2018.

• 2019 - Ramp-up production.

Component Part Manufacturing for RR’s Most

Advanced Passenger Aircraft Engines

Part of Rolls-Royce’s Asian Supply Chain

Single Source Final Assembly of the Trent 1000

and Trent 7000 engines in Singapore

UMW is the 1st Malaysian Tier 1 Supplier to Rolls-

Royce

UMW Aerospace Sdn Bhd

2018 FINANCIAL

PERFORMANCE


CORE SEGMENTS CONTINUED TO DELIVER HEALTHY

RESULTS IN 2018

RM’m

UMW HOLDINGS BERHAD

RM446m

RM143m

-RM18m

RM545m

RM152m

RM22m

Automotive Equipment M&E

2017

2018

Combined total

PBT

2018: RM719m

2017: RM571m25.9%


PATAMI FROM CONTINUING OPERATIONS SURGED IN 2018

UMW HOLDINGS BERHAD

(RM‘m) FY17 FY18

Net profit from Continuing

Operations144.9 643.7

Attributable to perpetual

sukuk holders0 (35.4)

PATAMI from Continuing

Operations35.3 490.6

Losses from Discontinued

operations(675.9) (148.9)

Consolidated PATAMI (640.6) 341.7

Attributable to non-

controlling shareholders(109.6) (117.7)


DISCONTINUED OPERATIONS

Unlisted Oil & Gas segment - carrying value

33mRM

▪Remaining carrying value for

investments in associates and

joint ventures

▪We do not expect any adverse

material impact to the Group

19m RM

▪Remaining carrying value for

subsidiaries

▪We do not expect any adverse

material impact to the Group

Associates & JVs Subsidiaries

UMW HOLDINGS BERHAD

• Out of 16 companies, only 6 are remaining

• Active negotiations are on-going to divest/liquidate the remaining companies


TOTAL EQUITY

RM5.7 billion

SHORT-TERM

BORROWINGS

RM535 million

CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2018

UMW HOLDINGS BERHAD

50%

27%

Debt-to-equity

ratio

Net Debt-to-

equity ratio

LONG-TERM

BORROWINGS

RM2.3 billion

DEPOSITS, CASH &

BANK BALANCES

RM1.3 billion

HISTORICAL

PERFORMANCE

27

SELECTED GROUP FINANCIAL HIGHLIGHTS

▪ Revenue (RM million) ▪ PATAMI (RM million)

▪ Gross Dividend Per Share of RM0.50 each (sen)

1 2

43

12,770

10,721

12,82013,536

15,817

13,95214,933

14,442

10,43711,06711,306

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

566382

527 486

994

653 652

(1,658)

(641)

342

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

▪ Dividend Payout Ratio (%)

57.7 59.0

75.8 75.2

58.8

78.7 76.1

>100.0

0.0 0.0

25.6

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

37.0

20.030.0 31.0

50.044.0 41.0

20.0

0.0 0.07.5

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

March 08

Share Split from

RM1.00 to RM0.50 each

UMW HOLDINGS BERHAD

*2018 figures are unaudited

(37)

2019 AND BEYOND…

29

OUR TRANSFORMATION STRATEGY

7 Strategic Pillars of Transformation Framework

UMW HOLDINGS BERHAD

Rationalise

non

strategic

assets

Unlock

value of

non

productive

assets

Digitise &

DigitaliseRevenue

Elevation

Innovation

Platform

Cost

Optimisation

& Synergy

Human

Capital

Strategic

Support

7 Strategic

Pillars

TRANSFORMATION STRATEGYCapstone for strategic planning at UMW

1 2 3 4 5 6 7

1. To focus and expand on the Group’s core businesses

2. To pursue sustainable growth strategies

3. To unlock value of the Group’s assets for further value creation Objectives

30

AUTOMOTIVE STRATEGY – UMW TOYOTA MOTOR

To regain No. 1 position in non-National segment

• Boost capacity and capability✓ High automation

✓ Plant & land size - 670,000 m²

• 2.6x bigger than the Shah Alam plant

✓ Annual capacity – 50,000 units on 1-shift operations

✓ Increase localisation. The all-new Vios has more

than 80% local content (previously 58%)

• Total Investment – RM1.8 billion

• Commenced operations in January 2019 with the

production of the all-new Toyota Vios

• Increase localisation – to improve cost and pricing competitiveness

• Expand CKD model offering, including EEV modelsStrategy

Second plant - Bukit Raja, Klang

UMW HOLDINGS BERHAD


AUTOMOTIVE SEGMENT – TOYOTA

TOYOTA CAMRYLaunched in Nov 2018, full-

year contribution in 2019

NEW MODEL OFFERINGS IN 2019 TO BOOST SALES

TOYOTA VIOSLaunched in Jan 2019;

target 30,000 unit sales in

2019

TOYOTA C-HRThe model update was

introduced in Jan 2019

TOYOTA YARISTo be launched in

2Q19

75,000 units

2019 TARGET• Produced from the new Bukit Raja plant

• Volume-driven models to increase sales

and market share

32

AUTOMOTIVE STRATEGY – PERODUA

Defend leading position in the Malaysian automotive market

• Improve model offering for the entry-level market

✓ To offer models in popular segments at an affordable priceStrategy

PERODUA ARUZLaunched in Jan 2019; target

30,000 unit sales in 2019

Perodua Aruz caters to the popular

SUV-segment

231,000 units

2019 TARGET

UMW HOLDINGS BERHAD

33

EQUIPMENT STRATEGY

Moving to strategic partnership and innovate new value-added

solutions and services to complement product range

Leveraging on our partnership with Komatsu

➢ Introduction of more products/models to cater to urbanisation

sector

➢ Opportunity to introduce SMARTCONSTRUCTION: ICT

solutions to construction job sites

➢ Provision of value-added services through competitive

product pricing, forex and financing assistance

➢ Enhancement in rental/leasing business

➢ Expansion in existing markets, ie: Myanmar

Heavy

Equipment

UMW Komatsu Heavy Equipment Sdn Bhd

UMW

(74%)

Komatsu Ltd

(26%)JV officially took

effect 1 Oct 2018

The entire heavy equipment business is parked under the JV, with the

following brands distributed in its respective existing markets

Since 1965

14 JAN 2019 - UMW Launches New

Komatsu Hi-efficiency Excavator Model

PC210-10M0 in Malaysia

UMW HOLDINGS BERHAD

Since 1979

34

EQUIPMENT STRATEGY

Moving to strategic partnership and innovate new value-added

solutions and services to complement product range

Industrial

Equipment

Diversifying and expanding product and service

offering in growth markets, i.e. Vietnam

➢ Provide improved after-sales services

➢ To explore new opportunities in various customer

segments

Leveraging on Internet of Things (IoT) to enhance

service and product offering

Expanding fleet management / rental business

UMW HOLDINGS BERHAD

35

M&E STRATEGY

Further expansion into high-value / advanced manufacturing

To expand automotive components business

➢ Improve synergies with UMWT and Perodua in its efforts to increase

localisation

➢ Increase sales for OEM and REM in both domestic and foreign

markets, from continued expansion of products and services

➢ KYB-UMW to commence plant modernisation initiatives to cater

to increasing demand

Explore opportunities in the HVM space

➢ Optimising our aerospace manufacturing capabilities

➢ Diversify into non-aerospace related projects

To improve margins

➢ Higher automation to optimize operations

➢ Material cost reduction with vendors and global sourcing

➢ Lean organization structure and processes to drive efficiency

Strategy

UMW HOLDINGS BERHAD

36

MONETISING OUR LAND ASSETS

UMW HOLDINGS BERHAD

SERENDAH LAND – 861 acres

• Will be developed into a High Value Manufacturing Park – by clusters

• Signed an MoU with MIDA and Invest Selangor to collaborate on the park’s development to

attract potential tenants

• Continuously working with MATRADE

• UMW Aerospace’s engine fan case manufacturing facility is the pioneer tenant – taking up 24

acres

• Several other tenants, including T7 Global took up 7 acres of land

• UMW’s operations in Shah Alam to move to Serendah within the next few years

• There have been strong interest with several deals in

the pipeline

37

▪ Continued expansion of our core business segments by venturing into new

markets, diversifying product mix and ancillary businesses

▪ Continued margin improvements via business optimisation initiatives

▪ Unlock value of the Group’s assets

UMW Group

Our goals

UMWT To regain No. 1

position in non-National

segment

Perodua to defend leading

position in the Malaysian

automotive market

Expand and innovate new

value-added solutions and

services to complement

product range

Evolve relationship with

Principals from Distributor to

Strategic Partner

Further expansion in high-

value / advanced

manufacturing portfolio

Expansion of auto

components business

SHORT- TO MID-TERM

Automotive Equipment M&E

UMW HOLDINGS BERHAD

▪ Pursuing industrial innovation in order to generate our own products and services

▪ Balanced portfolio in terms of earnings contribution between Automotive and non-

Automotive segments

LONG-TERM

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.

S. Vikneshwaran

Head, Investor, Media Relations & Sustainability

Email: [email protected]

Telephone: +603 20252104

THANK YOU

Roza Shahnaz Omar

Director, Group Strategy

UMW Corporation Sdn. Bhd.

Documents

UMW Holdings Bhd - ir.chartnexus.comir.chartnexus.com/umw/doc/media/UMW Corporate Presentation Website... · Exporting to 6 countries - Indonesia, Singapore, Mauritius, Fiji, Sri