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UMW HOLDINGS BERHAD
BEYOND BOUNDARIESUMW HOLDINGS BERHADCORPORATE PRESENTATION
FEBRUARY 2020
UMW HOLDINGS BERHAD
OUR BUSINESSDIVERSIFIED PORTFOLIO
AUTOMOTIVE EQUIPMENT MANUFACTURING & ENGINEERING
LANDBANK
• Manufacture
• Assembly
• Distribution
• Sales & service
• Distribution
• Trading
• Leasing
• After-sales service
• Manufacture of fan case
• Manufacture of automotive components
• Blending & distribution of lubricants
• Unlocking value of our vast landbank in Serendah
2
UMW HOLDINGS BERHAD
OUR STRENGTHLEADER IN OUR CORE BUSINESS SEGMENTS
3
• Leader in the Malaysianautomotive industry with51.4% market share (2019)through Toyota, Lexus andPerodua marques.
• First Malaysian company tomanufacture and assemblefan cases for Rolls-Royce asa Tier 1 supplier.
• Manufacture and exportKYB shock absorbers to 38countries from Malaysia.
• Distribute Komatsu heavyequipment in 5 countries inthe Asia-Pacific region.
• Hold more than 50% marketshare for Toyota forklift inMalaysia and Singapore; haveoperations in 5 countries inAsia-Pacific.
AUTOMOTIVE EQUIPMENT MANUFACTURING & ENGINEERING
UMW HOLDINGS BERHAD
OUR REVENUE AND PBT CONTRIBUTIONSEGMENTAL BREAKDOWN
* Excluding Aerospace sub-segment (within Manufacturing & Engineering) which was loss-making due to start-up operations
81% 81% 81% 81% 79%
13% 14% 13% 13% 14%
6% 5% 6% 6% 7%
86%78%
72% 71% 72%
13%20%
21% 22% 21%
1% 2%7% 7% 7%
R E V E N U E P B T R E V E N U E P B T R E V E N U E P B T R E V E N U E P B T R E V E N U E P B T
Automotive Equipment Manufacturing & Engineering
*
2014 2015 2016 2017 2018
4
**
UMW HOLDINGS BERHAD 5
OUR INTERNATIONAL PRESENCE12 KEY MARKETS
CREDIT RATING
China
Malaysia
Indonesia
Myanmar
Brunei
Papua
New Guinea
Singapore
Automotive
Equipment
Manufacturing & Engineering
Vietnam
18,342WORKFORCE
AA2
RAM Ratings
* Key markets and Workforce are inclusive of UMW and Perodua
FijiSri Lanka
Mauritius
Seychelles
UMW HOLDINGS BERHAD 6
OUR SHAREHOLDERSAS AT 31 JANUARY 2020
FTSE4Good Bursa Malaysia Index constituent
Bloomberg ticker UMWH:MK
Total number of shares 1,168,293,932
Bursa Malaysia Listing sector Main Market, Consumer Products & Services
60.57
5.33
7.0515.74
11.31
31/1/2020
Market Capitalisation
RM4.6b
PNB
EPF
Other Local Shareholders KWAP
Foreign Shareholders
▪ Permodalan Nasional Berhad & PNB
Managed Unit Trust Funds, 60.57%
▪ Employees Provident Fund Board,
11.31%▪ Foreign Shareholders, 5.33%
▪ Other Local Shareholders, 15.74% ▪ Kumpulan Wang Persaraan
(Diperbadankan), 7.05%
UMW HOLDINGS BERHAD 7
GROUP FINANCIAL HIGHLIGHTSHISTORICAL PERFORMANCE
▪ Revenue (RM million) ▪ PATAMI (RM million)
▪ Gross Dividend Per Share of RM0.50 each (sen)
1 2
43
10,721
12,82013,536
15,817
13,95213,951
14,932
10,43710,437 11,306
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
382527 486
994
653 652
-37
-1,658
-641
345
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
▪ Dividend Payout Ratio (%)
59.0
75.8 75.2
58.8
78.7 76.1
100.0
>100.0 0.0
25.6
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
20.030.0 31.0
50.044.0 41.0
20.0
0.0 0.07.5
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
UMW HOLDINGS BERHAD
AUTOMOTIVESEGMENT
UMW HOLDINGS BERHAD 9
AUTOMOTIVE SEGMENTSTRUCTURE
UMW Toyota Motor Sdn. Bhd.*
Manufacturer and dealer in component parts including engines, couplings and transmission components
Perodua Engine Manufacturing Sdn. Bhd.
Perodua ManufacturingSdn. Bhd.
Perodua Sales Sdn. Bhd.
30%
Toyota BoshokuUMW Sdn. Bhd.
Automotive Industries Sdn. Bhd.
Assembly Services Sdn. Bhd.
Perusahaan Otomobil KeduaSdn. 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 MalaysiaSdn. 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
Perodua Global ManufacturingSdn. 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.***
UMW HOLDINGS BERHAD 10
UMW GROUPMARQUES AND MODELS
COMPLETELY KNOCKED-DOWN (CKD)
YARISVIOS INNOVA RUSHFORTUNER HIACEHILUX
CAMRY COROLLA C-HR AVANZA ALPHARD VELLFIRE HARRIER
ESLS NX RX LX LC
AXIAMYVI ALZAARUZ
COMPLETELY BUILT-UP (CBU)
COMPLETELY KNOCKED-DOWN (CKD)
THAILAND JAPANINDONESIA
BEZZA
UMW HOLDINGS BERHAD
536,905
605,156 600,123627,733
655,744 666,487 666,677
580,085 576,625598,598 604,287 607,000
-2.0%
12.7%
-0.8%
4.6% 4.5%1.6% 0.0%
-13.0%
-0.6%
3.8%1.0%
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020T
Unit sales % Growth Year-on-Year
TOTAL INDUSTRY VOLUME (TIV)MALAYSIA AUTOMOTIVE ASSOCIATION (MAA)
▪ Low industry growth due to no end-of-life policy, no scrap policy, high car ownership.
▪ In 2019,TIV grew 1.0% to register sales of 604,287 units, fueled by the passenger vehicles (PV) segment which saw sales of 550,179 units. Within the PV segment, passenger cars continued to form the biggest segment with 69.4%.
▪ MAA is forecasting a marginal TIV growth in 2020, with a sales target of 607,000 units.
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UMW HOLDINGS BERHAD
82,08991,990 88,662
106,622
92,521103,636
95,861
65,11070,445 66,562 70,009
15.3% 15.2% 14.8%17.0%
14.1%15.6%
14.4%
11.2% 12.2%11.1% 11.6%
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Unit sales Market Share
UNIT SALESUMW TOYOTA MOTOR - TOYOTA AND LEXUS MODELS
▪ Importation of CBU vehicles and CKD components are transacted in US Dollar.
▪ UMWT launched the all-new Vios, Yaris and Corolla in 2019.
▪ Vios and Yaris are produced at UMWT’s new Bukit Raja plant whilst the Corolla is a CBU model from Thailand. Vios and Yaris share the same platform, with local content above 80%.
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UMW HOLDINGS BERHAD
166,736188,641 179,989 189,137 196,071 195,579
213,307 207,110 204,887227,243
240,341 240,000
31.1% 31.2%30.0% 30.1% 29.9% 29.3%
32.0%
35.7% 35.5%38.0%
39.8%
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020T
Unit sales Market Share
UNIT SALESPERODUA – 38%-OWNED ASSOCIATE
▪ Perodua maintained its No.1 position in overall market share for the 14th consecutive year in 2019.
▪ The all-new 7-seater SUV, Perodua Aruz was launched in January 2019. Enhanced Perodua Axiawas introduced in September 2019.
▪ Exports to 7 countries - Indonesia, Singapore, Mauritius, Fiji, Sri Lanka, Brunei and Seychelles.
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UMW HOLDINGS BERHAD
AUTOMOTIVE INDUSTRY – MARKET SHAREUMW GROUP MARKET SHARE GREW TO 51.4% IN 2019
UMW HOLDINGS BERHAD
39.8%
11.6%
48.6%
Brand 2019 2018
Units Market Share %
Units Market Share %
ProtonHondaNissanMazdaOther brands
100,18385,41821,23911,65175,446
16.614.1
3.51.9
12.5
64,744102,282
28,61016,03893,119
10.817.1
4.82.7
15.6
Total TIV 604,287 598,598
2018
227,243
38.0%
2018
66,562
11.1%
2018
304,909
50.9%
Perodua240,341 UMW Toyota
70,009
Others293,937
Source: Malaysian Automotive Association
Other Carmakers’ Sales and Market Share
• UMW Group sold 310,350units in 2019 with a market
share of 51.4% (2018 – 49.1%)
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UMW HOLDINGS BERHAD
Private consumption have normalized towards its long-
term average trend after the exceptional period during
the GST-free phase of June to August 2018.
Sustained private consumption growth could underpin
TIV growth in 2020598,714 600,000
612,000
2018 2019F 2020F
Malaysia TIV 2018-2020F (units)
Source: MAA
INDICATORS
7.1 6.9 6.6 7.9
8.9 8.4 7.6 7.8
7.0
3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19
Real private consumption growth(% y-o-y)
AUTOMOTIVE INDUSTRY OUTLOOKAUTO SALES GROWTH LARGELY DEPENDS ON THE STATE OF THE ECONOMY
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UMW HOLDINGS BERHAD 16
Expansion of model line-up1 Higher localisation 1
2 Higher automation
Improve
CompetitivenessCost optimisation
3 Highly-efficient Bukit Raja plant3 Collaboration with dealers to
boost after-sales4 Network rationalisation
UMW TOYOTA MOTOROPTIMISE COSTS WHILE ELEVATING REVENUE
2 Attractive financing packages –in partnership with Toyota Capital
• 4 new SUV models• Market share of 12%
2020
UMW HOLDINGS BERHAD
• 9-year financing plan – 3-tier step-up • Currently for Yaris, Vios, Avanza and Hilux – with plans for other models• Mainly to target first time buyers
TOYOTA EZ BELI CAMPAIGN
UMW TOYOTA MOTORATTRACTIVE STEP-UP FINANCING PACKAGES
17
UMW HOLDINGS BERHAD 18
Ride on Perodua’s success in the entry-level segment
• Perodua introduced an all-new SUV model, Aruz in January 2019
2Strategic planning of future car models
• To ensure it can compete effectively against its direct competitors
1
PERODUALEVERAGE ON EXCELLENT BRAND PERCEPTION FOR ENTRY-LEVEL SEGMENT
• Enhanced Perodua Axia was introduced in September 2019
• Facelift Perodua Bezza to be launched in early 2020
UMW HOLDINGS BERHAD
FINANCIAL HIGHLIGHTSAUTOMOTIVE
* PBT includes contribution from Perodua
Revenue
(RM million)
PBT *
(RM million)
11,498.1
10,023.010,766.0 10,722.0
8,451.0 8,972.2 8,946.7
2012 2013 2014 2015 2016 2017 2018
1,796.8
1,413.5 1,475.3
860.9
496.9 446.1550.0
2012 2013 2014 2015 2016 2017 2018
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UMW HOLDINGS BERHAD
EQUIPMENTSEGMENT
UMW HOLDINGS BERHAD 21
EQUIPMENT SEGMENTDISTRIBUTOR OF GLOBALLY-KNOWN BRANDS IN SOME PARTS OF THE REGION
HEAVY EQUIPMENT
INDUSTRIAL EQUIPMENT
Material handling
Marine & Power
• Agriculture• Construction• Forestry• Mining
• Industrial and manufacturing
• Industrial cleaning-▪ food and
beverage▪ material
handling▪ logistics
• Industrial and marine power solutions
UMW HOLDINGS BERHAD
HEAVY EQUIPMENTSTRUCTURE
UMW Komatsu Heavy Equipment Sdn Bhd
UMW Corporation(74%)
Komatsu Ltd(26%)
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:
2018 Revenue contribution
Malaysia, 42%
Myanmar, 38%
PNG, 17%
Singapore, 3%
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UMW HOLDINGS BERHAD
Toyota Forklift Franchise – UMW is one of the Top 10 distributors globally
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.
▪ Under the 2018 Toyota Material Handling International (TMHI) Award
Programme, UMW Industries was awarded the Diamond Club
Recognition, President’s Award (Gold) and Vision 2020 Award.
▪ Have ventured into leasing of Toyota forklifts – about 9,000 units in the
region.
Strong market leadership position
Since 1965
INDUSTRIAL EQUIPMENTMATERIAL HANDLING
Malaysia, 46%
Singapore, 39%
Vietnam, 12%
China, 3%
2018 Revenue contribution
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UMW HOLDINGS BERHAD
INDUSTRIAL EQUIPMENTMARINE & POWER
Compressors
Generators
Marine Engines
Oil spill equipment
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UMW HOLDINGS BERHAD
EQUIPMENT INDUSTRY OUTLOOKPOCKETS OF OPPORTUNITIES
HEAVY EQUIPMENT
• The higher allocation in development expenditure
during Budget 2020 could accelerate implementation
of projects
• Singapore’s healthy pipeline of public and private
sector projects should drive the construction sector
recovery and support sales of heavy equipment in the
country
2.6%0.3% 0.5%
-1.5%
4Q18 1Q19 2Q19 3Q19
Construction sector growth in Malaysia (% y-o-y)
M
Y
-1.2%
2.7% 2.8% 2.9%
4Q18 1Q19 2Q19 3Q19
Construction in Singapore (Real growth)
S
G
I
N
D
I
C
A
T
O
R
S
INDUSTRIAL EQUIPMENT
• The US-China trade conflict could provide opportunities
for ASEAN countries, especially in the manufacturing
sector
❑ Approved manufacturing investments in Malaysia
surged to RM33.1 bn in 1H19
• The Singapore’s Ministry of Trade & Industry expects the
manufacturing sector to return to positive growth in 2020
19
33.1
1H18 1H19
Approved manufacturing investments in Malaysia (RMbn)
M
Y
4.6%
-0.4%-3.3%
-1.7%
4Q18 1Q19 2Q19 3Q19
Manufacturing in Singapore (Real growth)
S
G
I
N
D
I
C
A
T
O
R
S
Source: MIDA
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UMW HOLDINGS BERHAD 26
EQUIPMENT SEGMENTSECTORAL SHIFT; EXPANSION OF PRODUCTS AND SERVICES
HEAVY EQUIPMENT INDUSTRIAL EQUIPMENT
1 Focus on more urbanised sectors –construction & mega infrastructure projects
Venture into leasing business model and equipment-as-a-service
6
Further expansion into the leasing business model
1
Ride on the urbanisation of Vietnam
2
Expand product line-up3
Leverage on Papua New Guinea’s gold mining and construction sectors
2
Implement extended warranty programme and maintenance service contract
Projects Est. cost
Penang Transport Master Plan RM32bn
Klang Valley MRT Line 3 (MRT3) RM20bn
KL-Singapore High Speed Rail RM20bn
East Coast Rail Link sub-contracts RM18bn
Pan Borneo Highway Sabah RM13bn
Bandar Malaysia infrastructure RM21bn
Projects Est. cost
Sarawak Coastal Highway RM5bn
Sarawak Second Trunk Road RM6bn
Sarawak Water Grid Phase 1 RM8bn
Labuan Bridge RM4bn
Johor BRT RM3bn
Kota Kinabalu Water Supply Scheme RM3bn
Source: Affin-Hwang Research
Provision of value-added services4 Diversify product base3
5
UMW HOLDINGS BERHAD
FINANCIAL HIGHLIGHTSEQUIPMENT
Revenue
(RM million)
PBT
(RM million)
2,138.5
1,705.5 1,767.21,882.6
1,382.8 1,458.9 1,539.6
2012 2013 2014 2015 2016 2017 2018
183.5195.8
218.2 226.5
145.6 141.8160.1
2012 2013 2014 2015 2016 2017 2018
27
35.0%
65.0%
42.0%
58.0%
39.0%
61.0%
25.0%
75.0%
32.0%
68.0%
32.0%
68.0%
Heavy Equipment Industrial Equipment
UMW HOLDINGS BERHAD
MANUFACTURING & ENGINEERING
SEGMENT
UMW HOLDINGS BERHAD
MANUFACTURING & ENGINEERING SEGMENTKEY PRODUCTS
Aerospace Component
Auto Components
Lubricants
Aero Engine Fan Cases
Contract Manufacturer for
Shock Absorbers Auto parts
Motorcycle suspension units
Shock Absorbers
• For both OEM and REM markets.• Export to more than 38 countries
from Malaysia.
Engineering plastic
• Oil Filters, Eco Filters & Fuel Filters
• Air Filters & Cabin Filters• Hydarulic & ATF Filters• Brake pads• Brake Fluid & Long-life
Radiator Coolant• Auto Transmission Fluid
• Cam Cover or Cylinder Head Cover• Air Intake Manifold• Charcoal Canister• Integrated Air Cleaner Assembly
UMW’s proprietary lubricant brand.
Premium range of Repsol lubricants for the automotive industryacross Asia and Southeast Asia Region
Cylinder Head Cover
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UMW HOLDINGS BERHAD
MANUFACTURING & ENGINEERING SEGMENTMANUFACTURE OF AERO ENGINE FAN CASES
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 -single-source supplier of fan cases for Trent 1000, with production for Trent 7000 engines expected in 4Q20
• Long-term contract of 25+5 years; signed in 2015
• The manufacturing plant is located in Serendah, Selangor
UMW Aerospace Sdn Bhd
29 Nov 2017 Delivery of the first fan case
2020 – Production ramp-up to continue
2019Ramp-up production
Milestones
Delivered more than 150 units
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UMW HOLDINGS BERHAD 31
MANUFACTURING & ENGINEERING SEGMENTINDUSTRY OUTLOOK
AUTO COMPONENTS• Local indicators suggest stable demand for
auto parts in Malaysia, underpinned by
healthy private consumption.
• Growth in the automotive industry will
sustain demand for lubricants, auto
components.
4.4
7.5
4.6 4.3 4.5
3.5
2Q18 3Q18 4Q18 1Q19 2Q19 3Q19
Sale of Motor Vehicle Parts & Accessories inMalaysia (%, y-o-y)
Source: DoSM
• Production ramp-up is progressing well as per
scheduled orders from Rolls-Royce.
• Production of Trent 7000 fan case scheduled to
commence in 4Q20.
• Combine production of Trent 1000 and Trent
7000 fan cases are expected to drive the
volume beyond break-even in 2020.
AEROSPACE
UMW HOLDINGS BERHAD 32
MANUFACTURING & ENGINEERING SEGMENTEXPANDING AND STRENGTHENING OPERATIONS
Commencement of KYB-UMW’s plant expansion and modernisation &
improve synergies with UMWT and Perodua01
02
03
Expansion of dealership network
05
04
Enhance position in aerospace business & entry into other High-Value
Manufacturing sectors
Continuous margin improvement efforts
Development of our own products
UMW HOLDINGS BERHAD
FINANCIAL HIGHLIGHTSMANUFACTURING & ENGINEERING
Revenue – exited automotive components manufacturing business in India in late 2015.PBT – Losses in automotive components manufacturing business in India (2013); Start-up losses at Aerospace sub-segment (2017)
Revenue
(RM million)
PBT
(RM million)
680.7735.5 725.1 707.5
601.5645.1
843.2
2012 2013 2014 2015 2016 2017 2018
9.9
-39.2
14.8 16.824.6
-17.7
21.5
2012 2013 2014 2015 2016 2017 2018
33
UMW HOLDINGS BERHAD
LANDBANK IN SERENDAH
UMW HOLDINGS BERHAD
UNLOCKING VALUE OF OUR ASSETSMONETISING LONG-HELD ASSETS
Close to 40 acres of UMW’s land in Serendah have been taken up so far
We are actively negotiating with interested parties and hope to close some deals soon.
UMW’s operations in Shah Alam to move to Serendah within the next few years.
861 acres of land in Serendah
Company Acreage
UMW Aerospace 24.0 acres
Multi-Code Electronics Industries (M) Bhd
8.25 acres
Private local company 5.3 acres
T7 Kilgour Sdn Bhd 2.0 acres
35
UMW HOLDINGS BERHAD
30th May 2019
THANK YOU
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.
Nik Azlan Bin Nik Abdul Aziz
Group Chief Financial Officer
UMW Corporation Sdn. Bhd.
S. Vikneshwaran
General Manager
Group Investor & Media Relations
Email: [email protected]
Telephone: +603 20252104