1

1H 2002 Results Announcement25 July, 2002

2

Scope of Briefing

Group Financial Highlights

1H Business Review and 2H Outlook

Strategic & Corporate Review

1. Group FinancialHighlights

4

Financial Highlights in 1H

1H PATMI was S$182m, 31% higher than same period lastyear

• Offshore and Marine contributed 53%

• Investments and Property contributed 21% and 19%respectively

Annualised ROE increased from 10.1% to 12.9%

Current order book is about S$3.4b, comprising

• O&M: S$2.1b

• Infrastructure:

– Energy: S$800m

– Network Engineering: S$510m

Interim dividend of 16%, or 8 cents per share less tax

5

Financial Highlights – P/L

* Include Bank’s contributions & before EI

($m) 1H 2002 1H 2001* % Change

Turnover 2,513 3,175 (21)EBITDA 325 517 (37)Operating Profit 239 412 (42)Profit before Tax 261 426 (39)PATMI 182 139 31PATMI excl. deferred tax reversal 168 139 21EPS (cents) 23.8 18.2 31DPS (cents) 8 - na

6

Financial Highlights – P/L

PATMI and EPS for both quarters continueto be strong

($m) 2Q 2002 1Q 2002 % Change

Turnover 1,349 1,164 16EBITDA 169 156 8Operating Profit 125 114 10Profit before Tax 130 131 (1)PATMI 100 82 22PATMI excl. deferred tax reversal 86 82 5EPS (cents) 13.1 10.7 22

7

Financial Highlights – C/F

30 Jun 2002($m)

Cash flow from operating activities Operating profit 239 Depreciation, amortisation & other items 102 Working capital changes, interest & tax paid 17

Net cash from operating activities 358

Net cash used in investing activities* (192)

Dividend paid to shareholders of the company & MI of subsidiaries

(110)

Free Cash Flow 56

*Includes fund used for the privatisation of a subsidiary at S$210m

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Potential Cash Generation

Operational Cashflow

Estimated Proceeds from:• Divestment of M1, SPC, Logistics,

Shipping, etc

• Property Securitisation/Sale– Future residential securitisation– investment properties

S$500m p.a.

S$900m

S$2,400m

S$1,500m

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End ‘03 Scenarios(Target (Target

Current D/E = 0.8) D/E = 0.6) S$m S$m S$m

Capital Employed 4,100 4,400 4,400

Net Debt 4,500 3,520 2,640

D/E 1.10 0.80 0.60

Divestment Proceeds 2,400 2,400Debt repayment -980 -1,860

Net cash for growth 1,420 540

Debt/ Equity Target

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Financial Highlights – B/S

Annualised ROE surpassed 12% target,reaching 12.9%

($m) 30 Jun 2002 31 Dec 2001 % Change

Shareholders' Funds 2,762 2,658 4Capital Employed 4,097 4,114 -NTA per share $3.53 $3.48 1ROE (Before EI) 12.9% 10.1% 28Net Gearing 1.10x 1.10x -

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Turnover by Segments

Turnover of core businessesincreased by 32%

($m) 1H 2002 % 1H 2001 % % Change

Offshore & Marine 862 34 609 25 42Infrastructure 294 12 233 10 26Property 145 6 146 6

Investments 1,212 48 1,440 59 (16)Total 2,513 100 2,428 100 4

Sub Total 1,301 52 988 41 32

-

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Total SingaporeOverseas($m) (%)(%)

Offshore & Marine 862 595Infrastructure 294 5941Property 145 7426

Sub total 1,301 2575Investments 1,212 7228Total 2,513 4852

1H 2002

75% of turnover of core businesses come from overseas customers

Turnover by Customers

13

EBITDA by Segments

Core businesses continue to generatestrong cashflow

($m) 1H 2002 % 1H 2001 % % Change

Offshore & Marine 139 43 59 22 136Infrastructure 29 9 73 27 (60)Property 77 24 85 32 (9)

Investments 80 24 49 19 63Total 325 100 266 100 22

Sub Total 245 76 217 81 13

14

PATMI by Segments

PATMI of core businesses grew by 70%

* PATMI before EI but includes deferred tax reversal of $9m in Offshore & Marine

($m) 1H 2002 % 1H 2001 % % Change

Offshore & Marine 96* 53 18 24 433Infrastructure 12 7 33 45 (64)Property 35 19 28 38 25

Investments 39 21 (5) (7) naTotal 182 100 74 100 146

Sub Total 143 79 79 107 81

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Results By Segments

PATMI before EI

28

35

(5.0)

34

12

33

87

18

65

14

(10)1030507090

110130150170190

1H 2001 1H 2002

S$m

S$139m

S$182m31% growth

21% growth

Offshore & MarineInfrastructure

PropertyInvestments

Keppel Capital

Deferred TaxReversal

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Growth of Core Businesses

0

20

40

60

80

100

120

140

Offshore & Marine 18 87Infrastructure 33 12Property 28 35Total 79 134

1H 2001 1H 2002

PATMI before EIS$m

70%growth79

143

* Impact on PATMI due to privatisation of Offshore & Marine

81% growth

Deferred Tax Reversal 9

79 143

32*

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• 1H Business Reviewand 2H Outlook

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Financial Highlights –Offshore & Marine

($m) 1H 2002 1H 2001 % Change

Turnover 862 609 42EBITDA 139 59 136Operating Profit 112 30 273Profit before Tax 119 36 231PATMI 96 18 433PATMI before deferred tax reversal 87 18 383Annualised ROE 15% 7% 114

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Offshore & Marine OrderbookS$m Client

For delivery in 2H 2002

Matterhorn TLP/Caratinga Topsides 60 Atlantia Offshore / Halliburton1 Jack-Up/5 Jack-Up Upgrades 260 Chiles Offshore / Diamond Offshore / Ensco

/ GlobalSantaFe1 Cable Ship/4 Tugs/1 Supply Vessel 140 Tycom / Keppel Smit / Abu Dhabi Seaport /

SURF4 FPSO Conversions 270 SBM / Prosafe / VanguardMiscellaneous rig repairs Various owners

For delivery in 2003/2004

2 FPSO Conversions 220 Halliburton / SBM1 Semisubmersible/1 Semisubmersible Conversion

370 Maersk / Diamond Offshore

1 Jack-Up/3 Jack-Up Upgrades/1 Processing Platform

290 Diamond Offshore / Ensco / Atwood / Oceanics / Petrovietnam

2 Cable ships/2 AHTS/1 Swamp Barge/3 Tugs

250 PT Apexindo / Keppel Smit / Tycom /

1 Jack-Up/ 2 AHTS 250 Perforadora / Delba Maratima

Total 2.1b

Delba Maratima / Hadi Hammam

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Offshore & Marine Review

Heavy workload resulted in higher turnover andoperating profit in 1H 2002

Major contract completions in 2Q 2002 include ajack-up, an AHTS and five tugs

Major contracts totalling $238m secured in 2Q2002, include:

• A swamp barge

• A jack-up upgrade

• Three FPSO conversions

• Three tugs

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Offshore & Marine Review

Integration of Offshore and Marine on track

• Synergies of at least S$10m in 2002 and S$20min 2003

Major jobs in progress on schedule and withinbudget

Aim to develop Centre of Excellence inSingapore to enhance our leadership andcompetitive position

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Offshore & Marine Outlook

Strong orderbook of S$2.1b for delivery between2002 – 2004

Continue to receive enquiries on new rigs,upgrades, conversions, repairs,FPSO conversionsand offshore vessels (AHTS and supply vessels)

Offshore market remains active, especially in theAmericas, West Africa and Asia Pacific

Demand for newbuildings, conversions and upgradesexpected to be buoyant due to large number of ageingrigs

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Offshore & Marine Outlook

Preliminary agreement to acquire an 85% stakein Dutch offshore repair and conversion yard,Verolme Botlek

• Acquisition will accord Keppel stronger foothold inthe North Sea and West African markets

Shiprepair market likely to remain competitive

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InfrastructureNetwork Engineering : Financial Highlights

($m) 1H 2002 1H 2001 % Change

Turnover 85 58 47EBITDA 11 8 38Operating Profit 10 7 43Profit before Tax 12 15 (20)PATMI before EI 3 6 (50)Annualised ROE 18% 40% (55)

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Infrastructure

Network Engineering : Review

Wireline business performed better than expectation

Customised and installed proprietary voice portalsystem for Hong Kong CSL

Strategic Partnerships established to tap partners’capabilities and networks

Setting up Centre of Network Technology to developnext generation technology solutions

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InfrastructureNetwork Engineering : Outlook

Order book of $510m for delivery between 2002and 2004• Wireless S$180m• Wireline S$330m

Pursuing orders in excess of S$250mReap synergistic gains from acquisition of EchoBroadbandGrowth factors:• newbuild and upgrades of mobile networks (2-2.5G)• outsourcing trend by operators and vendors

S$1b revenue target: 2005

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InfrastructureUtilities Engineering : Financial Highlights

($m) 1H 2002 1H 2001 % Change

Turnover 209 175 19EBITDA 18 65 (72)Operating Profit 6 57 (89)Profit before Tax 9 60 (85)PATMI before EI 9 27 (67)Annualised ROE 5% 13% (62)

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Utilities Engineering : Review

Commissioned power barges in Brazil

Increased output of Nicaraguan plant

Won S$30m contract for construction ofFairchild Semiconductor’s facility in Suzhou,China

Infrastructure

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Utilities Engineering : Outlook

Performance of power generation business willimprove in 2H 2002

• Earnings from Brazil power barges project to commence

Awaiting tender outcome of desalination project

Will participate in Singapore genco privatisation

Explore acquisition of power generation assets inthe region

Monetise assets when opportunities arise

Infrastructure

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Financial Highlights - Property

*Property Segment includes all property related businesses of KCL

($m) 1H 2002 1H 2001 % Change

Turnover 145 146 -EBITDA 77 85 (9)Operating Profit 66 73 (10)Profit before Tax 64 59 8PATMI before EI 35 28 25Annualised ROE 5% 4% 25

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Property Review

Acquired a 7.2ha site in Beijing, for high-riseresidential development and commencedconstruction of One Park Avenue, Shanghai

Purchased 8.2ha site in Bangkok for landedresidential development

Monetised S$355m of receivables

Commenced work on “One Raffles Quay” forsale/lease

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Property Outlook

Singapore residential market has bottomed;Strong take-up of estimated 6,000 units in1H 2002;

Selective residential launches in 2H 2002

Maintain business development efforts forresidential development projects overseasincluding China, Thailand and Vietnam

Continue to pursue property fundmanagement business

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Financial Highlights - Investments

($m) 1H 2002 1H 2001 % Change

Turnover 1,212 1,440 (16)EBITDA 80 49 63Operating Profit 45 8 463Profit before Tax 57 11 418PATMI 39 (5) naPATMI before deferred tax reversal 34 (5) na

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Divestments

Property

• Monetisation of S$355m of residential receivables completed

• Working towards divestment of other investment properties

– Outright sale

– Securitisation

SPC

• Divestment process started in 2002

• Several interested parties

MobileOne (M1)

• Exploring all options, including IPO

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Group Outlook for 2H 2002

Operating performance for 2Hexpected to be maintained

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Revenue Recognition Policy

0 20 40 60 80 100

20

40

60

80

100

% Completion

% Revenue / ProfitRecognition

O&M & LT Contracts

Trading Properties

Products/Services

Contingencies or Anticipated losses fully provided for

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Revenue Recognition Policy

0 20 40 60 80 100

20

40

60

80

100

% Completion

% Revenue / ProfitRecognition

O&M & LT Contracts

Trading Properties

Products/Services

Contingencies or Anticipated losses fully provided for

38

Revenue Recognition Policy

0 20 40 60 80 100

20

40

60

80

100

% Completion

% Revenue / ProfitRecognition

O&M & LT Contracts

Trading Properties

Products/Services

Contingencies or Anticipated losses fully provided for

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15.811.1 11.1

13.918.2

9.4 17.216.8

17.4

23.85.3

'97 '98 '99 '00 '01 '02

1H 2H

PATMI & EPS (1997 – Present)

* Before EI

10684 86

108139

74134

129

134

18240

'97 '98 '99 '00 '01 '02

1H 2H

PATMI* (S$m) EPS* (Cents)

180

124

220237

273

1H:

182 25.2

16.4

28.330.7

35.6

1H:

23.8

40

ROE & DPS (1997 – Present)

* Annualised

10.1

8.57.9

3.9

5.3

12.9*

13

8

10

12

8

16

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

1997 1998 1999 2000 2001 1H 2002

RO

E (

%)

0

2

4

6

8

10

12

14

16

18

DP

S (

Cen

ts)

ROE Dividend

Interim Dividend

Capital repayment $0.50 per share

Introduction toNetwork Engineering &Technology Solutions

42

NETWORKENGINEERING

• Network Design andPlanning(Ish, CegeCom)

• Project Managementand NetworkImplementation(Maxis, M1 andNokia)

OPERATION ANDMAINTENANCE

• Operating andmaintaining networks(M1, Maxis, Outsourcingof helpdesks)

• Optimizing networks(CDMA network of ChinaUnicom)

• Develop softwaresolutions for network mgtand opn

TECHNOLOGYSOLUTIONS

• Provide technologysolutions to enhanceservice providers’competitive advantageand open newmarkets(Voice portal for HKCSL)

Building NetworkInfrastructure

Building NetworkInfrastructure

Operating & MaintainingNetworks

Operating & MaintainingNetworks

Sales & Marketingof Services

Sales & Marketingof Services

A suite of products & services catering to telecommunicationsservice providers throughout their entire business lifecycle

Network Engineering & TechnologySolutions

43

Our Goal

Knowledge-based business in the info-comms industrySpecialized competencies in:• Network Design• Project Management• Network Operations• System Integration• Technology Solutions

Customers are international and local telecoms serviceproviders spread across Asia-Pacific, Europe and USAFinancial goal is to achieve $1 billion turnover by 2005and sustainable growth thereafter

North Asia & Europe

4. Penetrate markets withhigh growth andearly adoption of

innovations

3. Expand comprehensivesuite of products & services

NetworkEngineering

Nwk Ops &Maintenance

TechnologySolutions

Complete suite of pdts & svcesenhance our value proposition

and increase “stickiness”

MarketExpansion

North Americas

5. Leverage on in-countrycustomers, partners and

infrastructure to capitalize onopportunities.

Intellectual property, Innovative solutions & middleware

give us clear competitive advantage

6. Use Innovative solutions &middleware as

key differentiator andextend up the value chain.

Innovativesolutions

Innovativesolutions Telcos

NewCapabilities& markets

Val

ue

Pro

po

siti

on

Products and services addressefficiency and

cost effectiveness ofnetwork design & implementation

ASEAN & Germany

1. Consolidate existingbusinesses and

focus on existingkey competencies

and target atwireless and fixed linebroadband customers

2. Focus on home markets forinitial success and

critical mass

KepComms

KepComms

EchoBB

EchoBB

TrisilcoFolec

TrisilcoFolec+ +

KTT’s Strategy

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Near Term Growth Initiatives

Leverage recent acquisition of ECHO Broadband(July 2002) for entry into European wireless marketsEstablish presence in China for network design,project management and optimization workSecure business and position in Japan – early marketadoption of 3G – through proposed joint venture withMVNO Kabushiki Kaisha

Strategic alliances• Gamma Projects in the asset and infrastructure management

space• Metatron in network performance measurement and

optimization

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Initiatives with 3-year Perspective

Position for 3G by securing projects in 2.5G, Wireless IPand Wireless DataContinue to sense for emerging technology and acquirenew skill sets and intellectual propertySet up Center of Network Technology in collaborationwith the Institute for Communications Research andNational University of Singapore to develop nextgeneration technology solutionsContinue to seek strategic alliances for marketcollaborationLeverage our US presence for market expansion

• Strategic &Corporate Review

48

Strategic Review

Financial Targets

Maintain 15% - 20% CAGR earningsgrowth through 2003

ROE of 12% - 15% by end 2003

Net gearing of 0.6x - 0.8x by end 2003

EVA focused

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Focus on Shareholder Value

• Core businesses PATMI grew by 70%,before deferred tax reversals

• 75% of core businesses’ turnover comefrom overseas customers

Build on Core Competencies

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Focus on Shareholder Value

• Real Estate to target China

• Network Engineering to target China,Europe

• O&M to finalise Dutch yard acquisition aspart of “near market, near customer”strategy

Targeting Global Growth Markets

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Focus on Shareholder Value

• Centre of Excellence for O&M:– Enhance leadership and competitive position in industry

– Develop new products and own intellectual property

– Increase pool of offshore and marine engineers

• Centre of Network Technology for NetworkEngineering:

– Develop and own technology solutions andintellectual capital

– Identify and adapt new emerging technologies

Create and sustain competitive advantage

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Focus on Shareholder Value

• System of checks and balance betweenBoard and Management

• Frequent communication with public andinvestors

• Good corporate governance as part ofKeppel Culture

Strong Corporate Governance

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Keppel Corporation1H 2002 Results

Thank YouQ&A