Daibochi Plastic & Packaging Industry Berhad · 2021. 3. 2. · Investors’ Briefing 1Q11...
Transcript of Daibochi Plastic & Packaging Industry Berhad · 2021. 3. 2. · Investors’ Briefing 1Q11...
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Daibochi Plastic & Packaging Industry
Berhad
Investors’ Briefing
1Q11 Financial Results & Corporate Update
11 May 2011
IR Adviser
AQUILAS
• 1Q11 Operational Highlights
• 1Q11 Financial Review
• Prospects and 2011 Plans
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1Q11 Operational Highlights
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• 1Q11 revenue increase mainly from core biz
» 13.4% revenue growth; packaging the main contributor
with 96% of 1Q11 revenues
» Packaging sales up 9.9% in 1Q11 to RM65.1 mil
(vs 1Q10 RM59.2 mil) largely spurred by higher
average selling prices as a result of passing on of
increased cost of polyester film
» Minimal contributions from property development of
RM2.6 mil in 1Q11 (vs 1Q10 RM0.5 mil)
• Yet still-rising raw material prices impacted profitability» PET prices stabilized in 1Q11, but PE, PP and OPP
resumed uptrend
» Prices of solvent - sourced from Japan - trending up
due to tight supply from disruption to supply chain
» This resulted in 1Q11 net profit of RM4.6 mil
(vs RM5.0 mil in 1Q10)
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1Q11 O
pera
tional Highlights
1Q11 O
pera
tional Highlights
Higher 1Q11 revenues from passing on of higher input costs …however profit impacted by still-rising raw material prices
Revenue CAGR (FY04 to FY10): 8.9%
PBT CAGR (04-10): 32.2%
PATMI CAGR (04-10): 35.8%
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1Q11 Financial Review
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1Q11 Inco
me Sta
tement
1Q11 Inco
me Sta
tement
FY2011 expected to remain challenging from raw material price uncertainty…
• 1Q11
showing
improving
margins vs
4Q10 due to
passing on of
increased
polyester
film cost
• Forex loss contained at
RM154K
55.8
55.8
57.6
57.6
53.8
53.8
54.6
54.6
59.7
59.7
61.2
61.2
71.4
71.4
75.5
75.5
67.7
67.7
20.0
40.0
60.0
80.0
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
Quarterly Revenue (RM ‘mil)
+13.4%
5.0
5.0
5.8
5.8
5.9
5.9
6.1
6.1
5.0
5.0
4.2
4.2
4.8
4.8
4.2
4.2
4.6
4.6
0.0
2.0
4.0
6.0
8.0
10.0
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
Quarterly PATMI (RM ‘mil)
(7.4%)
1Q11 to
31.3.11
1Q10 to
31.3.10
Change vs
previous qtr RM'mil
4Q10 to
31.12.10
Change vs
preceding qtr
67.67 59.69 13.4% Revenue 75.46 (10.3%)
6.27 6.61 (5.1%) Operating Profit 5.34 17.5%
(0.11) (0.09) (15.2%) Share of Associates 0.37 (128.4%)
5.89 6.35 (7.3%) Pre-tax Profit 5.47 7.7%
4.65 5.02 (7.4%) Net Profit to Shareholders 4.16 11.8%
6.20 6.68 (7.2%) Basic EPS (sen) 5.50 12.7%
9.3% 11.1% (1.8) EBIT margin 7.1% 2.2
8.7% 10.6% (1.9) PBT margin 7.2% 1.5
6.9% 8.4% (1.5) Net margin 5.5% 1.4
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1Q11 Balance
Sheet (H
ighlights)
1Q11 Balance
Sheet (H
ighlights)
Increasing asset base with additional printing machine to support enlarged operations…
RM’ mil As at 31.3.11
(Unaudited)
As at 31.12.10(Audited)
Fixed assets (excl associate investment) 70.86 66.21
Associate investment 22.97 23.08
Current assets 120.28 122.72
Current liabilities 68.17 69.26
Shareholders’ equity 132.25 131.47
Total borrowings 38.39 29.53
Cash & Bank Balances 8.92 6.30
Net gearing 0.22 x 0.18 x
Return on Average Shareholders Equity 14.1%* 14.3%
Return on Average Total Assets 8.7%* 11.9%
• Higher borrowings
to finance higher
working capital in
line with increased
raw material costs
• Net gearing still low
• Higher PPE from
additional printing
machine
1.52 1.52 3.04 4.55 4.55 11.67 9.38 2.28
52.3%
73.8%
55.9% 52.4% 55.8% 51.3% 51.6% 49.0%
0.0%
25.0%
50.0%
75.0%
100.0%
0.00
3.00
6.00
9.00
12.00
2004 2005 2006 2007 2008 2009 2010 1Q11
%RM ‘mil Dividend Payout
Dividend Payout (RM 'mil) Payout Ratio
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Dividend Histo
ryDividend Histo
ry
1st interim tax exempt dividend of 3.0 sen/share payable on 10 June 2011…
2.02.0 2.02.0 4.04.0 6.06.0 6.06.0 15.515.5 12.512.5 3.03.00.0
4.0
8.0
12.0
16.0
2004 2005 2006 2007 2008 2009 2010 1Q11
sen Dividend Payout (sen)
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PROSPECTS AND 2011 PLANS
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Gro
wth Strategies
Gro
wth Strategies
Putting in place strategies to overcome challenging FY2011… also building sustainable and higher-margin earnings base
(I)(I) Regularly monitoring raw material price trends Regularly monitoring raw material price trends
• Quarterly price review mechanism still in place for key customers
• Maintaining R&D to develop new applications
(II) (II) Developing more mainstay clientsDeveloping more mainstay clients
• Aiming to become the main supplier for an increasing number of
MNCs
(III)(III) Obtaining the necessary approvals for higher valueObtaining the necessary approvals for higher value--add packaging add packaging
• Undergoing pre-qualification trials for ESD packaging
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THANK YOUBursa: DAIBOCI/8125 Bloomberg: DPP:MK Reuters: DPPM.KL
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IR Contacts:
Thomas Lim E: [email protected] T: 06-231 9779
Julia Pong E: [email protected] T: 012-3909 258
APPENDIX
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CORPORATE PROFILE
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The LARGEST supplier of packaging in SEAThe LARGEST supplier of packaging in SEA
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Daibochi, a resilient investment case…
Tra
ck Reco
rdTra
ck Reco
rd The SOLE supplier toThe SOLE supplier to ChembongChembong Confectionery Confectionery Factory in Factory in M’siaM’sia
Supplier of Supplier of >90% of ’s flexible packaging in >90% of ’s flexible packaging in M’siaM’sia
The SOLE supplier of Kraft / biscuits in The SOLE supplier of Kraft / biscuits in M’siaM’siaOther important customers:
� Listed since 1990, now on Main Market of Bursa M’sia
� Market cap of RM212.5 mil (9.5.11)
� Dividend policy of paying minimum 50% of net profit to shareholders
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DAIBOCHI PLASTIC & PACKAGING INDUSTRY BERHAD
ListedMain Market, Bursa Malaysia since 1990(Transferred from Second Board in 2003)
Sector Industrial Products
CodesBursa: 8125 / DAIBOCIBloomberg: DPP:MKReuters: DPPM.KL
Share Capital RM75.9 mil (75.902 mil shares of RM1 each)
Market Capitalization RM212.53 mil (RM2.80 as at 9 May 2011)
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Listed since 1990…
Corp
ora
te Inform
ation
Corp
ora
te Inform
ation
Corp
ora
te Pro
file
Corp
ora
te Pro
file
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Leading flexible packaging solutions provider, with enviable reputation exceeding 35 years…
1994 – Acquired fastest extrusion laminator in SEA
1996 - Moved to current premises with >325,000 sq ft built-up area
2001 – Incorporated Australian subsidiary; Accredited with ISO:9001
2009 - Acquired 9th printing machine; Obtained HALAL Certification;
1999 – Supplier to Nestle M’sia
2002 – Acquired metallizer with Plasma Tech to produce high-barrier films;
Regional Supplier to Nestle in SEA
2008 – Acquired wide web polypropylene film making machine
2007 - Received Gold Award for the Colorpak Packaging Export Award at Australian Packaging Awards
2004 – Acquired M’sia’s 1st 5-layer-blown film machine to produce transparent barrier films
2003 – Transfer to Main Board (now Main Market); Accredited with HACCP
1990 – Acquired metallizer to produce in-house metalized films; Listed on 2nd Board of KLSE (Bursa M’sia)
1987 – Acquired polypropylene film-making machine to produce in-house films
1984 – Started in-house printing cylinder making
1972 – Established in Melaka with 10,000 sq ft plant; Moved to larger premises with 165,527 sq ft
Regional supplier for BAT
2010 – Obtained Letter of Validation from USA for electronic packaging
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Corp
ora
te Pro
file (
Corp
ora
te Pro
file (co
n’t
con’t))
•• Accredited and worldAccredited and world--class class production facilitiesproduction facilities» Attained ISO:9001 certification
» Hazard Analysis Critical Control Points
(HACCP) compliant to ensure
adherence to food safety requirements
» Obtained HALAL certification
•• WellWell--equipped laboratory testing equipped laboratory testing facilitiesfacilities» To ensure our products exceed customers’
packaging barrier (MVTR ASTM F1249, O2TR
ASTM D3895-35), retention (GC with
Headspace) and migration (COF ASTM
D1894) requirements.
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Internationally-certified production facilities that comply with all factory audits by our MNC clientele…
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Pro
duction Facilities
Pro
duction Facilities
Integrated end-to-end packaging process… equipped with specialized in-house capabilities
PrepressPrepressCylinder Cylinder MakingMaking
Gravure Gravure PrintingPrinting
Lamination Lamination (Extrusion / (Extrusion /
Dry)Dry)
Slitting / Slitting / BaggingBagging
CPP Film Metallizer
Up to 9-colour 2-sided printingIn-house capabilities Solvent-based/free Capabilities incl Standing Pouch
The only player with in-house cylinder-making, and one of the few with metallizing and sealing capabilities for quality assurance and constant improvement at key stages
To build high barriersPolypropylene sealing films
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Daiboch
i Pro
ducts
Daiboch
i Pro
ducts
Wide range of packaging solutions for various product functions… Constantly innovating for changing requirements
Film Type Applications / Use
High Permeability Barrier / Performance Coffee, Nuts, Potato Chips
Cost Effective Barrier Snacks, Biscuits, Wafer, Chocolate, Cakes
General Packaging Outer Pack, Noodles, Biscuits, Wafers
Specialty Application Labelling, Ice-cream, Frozen Food, Cereal Peel Seal, Seasoning Oil, Powder / Liquid Detergent,
Shower Foam, Tobacco, Pet food
Food Beverage FMCG Specialty
Customer Base
Customer Base
Diversified clientele of leading brands… 20
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Key M
anagement
Key M
anagement
Experienced management with industry expertise…
Thomas Lim Soo Koon, Managing Director
- Holds a degree in Bachelor of Science Industrial Engineering and Management from Oklahoma State University, &
Master of Business Administration degree from Oklahoma State University.
- Joined Daibochi in 1995, and was appointed as Managing Director in February 2005.
- Played a key role in building Group’s MNC clientele.
Datuk Wong Soon Lim, Executive Director
- An accountant by training and a member of the Malaysian Association of the Institute of Chartered Secretaries and
Administrators.
- Has an extensive experience and knowledge in the field of accounting, finance, consultancy, corporate finance,
manufacturing and property development. Instrumental in listing of the Company.
Low Chan Tian, Executive Director
- Holds a degree in Bachelor of Engineering from the University of Western Australia.
- Has wide experience in manufacturing, property development, business and finance.
Low Jin Wei, Executive Director
- Appointed on 5 October 2010
- Holds a degree in Bachelor of Commerce (Major in Finance & Marketing) from University of Sydney, NSW, Australia.
- Prior to this, Mr. Low was the Managing Director / Project Director of GlassKote (Malaysia) Sdn Bhd from 2005 to
September 2010.
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Major Shareholders
Major Shareholders
Growing institutional following… Free float retained at >50%
No. of shares (‘mil)(30.4.2011)
Percentage *
Low Chan Tian, ED 6.69 8.9%
Datuk Wong Soon Lim, ED 4.71 6.3%
* Excluding 1,183,200 shares bought back by the Company and retained as treasury shares
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FY10
FY10Pro
duct Segmenta
tion
Pro
duct Segmenta
tion
Group retains resilience… Steadily-growing non-F&B segment to broaden revenue base beyond traditional sectors
97% 96% 96% 97%95% 94%
89%
3% 4% 4% 3%5% 6%
11%
80%
85%
90%
95%
100%
2004 2005 2006 2007 2008 2009 2010
Revenue Segmentation (Product)
F&B Non F&B
F&B: Confectionery, snack foods, biscuits, dairy, frozen food, cereal, coffee/tea, soft drinks, etc Non F&B: Shampoo, detergent, personal care, sanitary, cigarette packaging, pet food, etc
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FY10 Geogra
phical Segmenta
tion
FY10 Geogra
phical Segmenta
tion
More volume sales to overseas in FY2010… momentum to continue in FY2011 with new customers in Australia
Overseas40%
Domestic60%
FY10 Revenue: RM267.7 mil
0%
10%
20%
30%
40%
50%
60%
0
20
40
60
80
100
120
2004 2005 2006 2007 2008 2009 2010
Revenue Contribution
RM ‘milOverseas Revenue
Overseas Revenue (RM'mil) Contribution (%)
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INDUSTRY INSIGHT
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•• Environmental concerns allayed with flexible packagingEnvironmental concerns allayed with flexible packaging» The ‘greener alternative’ compared to rigid packaging
•• Flexible packaging market, worth $1.41 Flexible packaging market, worth $1.41 bilbil in 2008, estimated to in 2008, estimated to reach $2.22 reach $2.22 bilbil in 2015in 2015*» Robust growth in food processing sector
» Rising demand for food exports, i.e. higher food safety concerns
» Increasing affluence of urban population who favour packaged food
•• Evident trend of flexible packaging gradually replacing rigid Evident trend of flexible packaging gradually replacing rigid packagingpackaging» Similar functions achieved with lower cost and greater flexibility; e.g. Stand-up
pouches and re-closable packs offer merchandizing advantages to FMCG players
» Consumes ~17% less energy compared to rigid packaging, reducing transportation costs.
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Industry
Insight
Industry
Insight
Flexible packaging perceived as the environmentally-friendly alternative… poised to tap into large market potential
* Source: “Southeast Asia Plastic Flexible Packaging Market for Food,” Frost & Sullivan, May 2009.
Countries covered were Thailand, Indonesia, Malaysia, the Philippines, and Singapore