Riverstone Holdings Limited 3Q Results Briefing 2 November...
Transcript of Riverstone Holdings Limited 3Q Results Briefing 2 November...
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-Riverstone Holdings Limited –
3Q Results Briefing
2 November 2010
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Disclaimer
The views expressed by Riverstone Holdings Ltd (the "External Party") on the occasion of Phillip
Security lunch presentation: Riverstone Holdings Ltd are the personal views and opinions of the
External Party (the "External Party's Views") and in no way reflect the views, opinions, expressions or
representations of Phillip Securities Pte Ltd.
Phillip Securities has no, and will not accept any, obligation to check or ensure (i) the reliability,
relevancy or fairness of the External Party's Views, or (ii) the accuracy or completeness of the External
Party's Views. Without prejudice to or derogating from the generality of the foregoing, no representation
or assurance is given by Phillip Securities Pte Ltd that the External Party's Views contain all information
that an investor may require. To the extent permitted by applicable law, Phillip Securities Pte Ltd, or any
of its affiliates, or its related persons (and their respective directors, associates, connected persons
and/or employees) shall not be liable in any manner whatsoever for any consequences (including but not
limited to any direct, indirect or consequential losses, loss of profits and damages) arising from the
reliance or use of the External Party's Views
Investors are advised to make their own independent evaluation of the External Party's Views, consider
their own individual investment objectives, financial situation and particular needs and consult their own
professional and financial advisers as to the legal, business, financial, tax and other aspects as
investors may regard as relevant.
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Agenda
Overview of Riverstone
Our Competitive Strengths
Our Track Record
3Q2010 and 9M2010 Update
Earnings Drivers and Outlook
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What We Do
Riverstone is
a leading manufacturer of
High-Tech Cleanroom
and
Healthcare Gloves
OUR VISIONTo stay as the global leader in the manufacturing
of Cleanroom and Healthcare consumables
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Products
• Other cleanroom
consumables
•Face pouches
•Hoods,Caps
•Jumpsuits
•Shoe covers
•Critical task wipes
•Swabs
Manufactured
Products
Source
& Market
Products
• Nitrile gloves
• Natural rubber gloves
• Other cleanroom
consumables
•Finger cots
•Packaging materials
•Facemasks
Riverstone
– An Integrated Cleanroom Supplier -
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Our Market Position
RS
Cleanroom
Gloves
Riverstone is the company that focuses on
High-tech cleanroom gloves
Heathcare
Gloves
Industrial
Gloves
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Our Market Position
Heathcare
Gloves
Profit
Margin
Cleanroom
Gloves
Profit
Margin
Riverstone is the company that focuses on
High-tech cleanroom gloves7
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Our Manufacturing Facilities
Integrated manufacturing
operations
Malaysia (3), Thailand (1), China (1)
Internationally NEBB certified
class 10 & class 100 cleanroom
facilities
ISO 9000 and ISO 14000 certification
Annual Capacity as at 30 Sep 2010
1.4 billion gloves
More than 600 million pieces of finger
cots
More than 1,500 tonnes of cleanroom
packaging materials
Over 40 million pieces of face masks
Malaysia Plant in Bukit Beruntung,Selangor
China Plant
Thailand Plant
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Product Mix
Product Revenue
contribution
Remark
Cleanroom Gloves 80.6% 1. Cleanroom glove
- Nitrile 12.5%
- Latex
- PVC 40%
- Cotton
2. Market Value = USD 1 billion
Healthcare Gloves 13.5% Annual global consumption – 145
billion pieces
Annual growth rate: 8-10%
Current RS production – 0.2% of
global consumption. Room to grow.
Other CR
consumables
5.9% Good potential to grow with new
facilities
Esp. Cleanroom packaging bags
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The Industries We Serve In Cleanroom
High-Tech Electronics Manufacturing
Hard Disk Drives
Semiconductors
LCD
External Storage Devices
Consumer Electronic Devices
Medical Devices Manufacturing
Automobile
Pharmaceutical
Aerospace
Laboratory and Research
* 80.6% of our Business:
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Riverstone’s Niche In Healthcare Gloves
Highly customised segments in the healthcare industry, for example:
Procedure gloves - for superior barrier protection,
High-risk gloves - for better protection in carrying out high risk, harzardous
tasks,
Hand specific gloves – for providing more comfort and better fitting,
Dental gloves – higher priced products and
Accelerator-free gloves - to minimise type IV allergic reaction.
* 13.5% of our Business
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We Are Different
Riverstone Other Gloves Manufacturers
Cleanroom Gloves
Highly customized Mass Volume Standardized Products
Higher Barrier of Entry
1)3 processes
2)Qualification processes take longer time
3)Spec depends on functionality
Comparatively Lower Barrier of Entry
1) 1 process
Own Brand and Deal mainly Directly With End Users Mainly OEM
High-Tech Value Added To Products
(we provide ESD and contamination solution for our customers)
Innovative product development to meet customers’ requirements (meet customer
product life cycle requirement)
Flexible Production Lines To Meet Changing Demands
Sterile Gloves For Cleanroom and Pharmaceutical Manufacturing Applications
Healthcare Gloves
Premium gloves - Accelerator-Free Gloves
- Procedure Gloves
- Hand Specific Gloves
- Sterile product.
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Network of
international sales
offices:
Singapore
Malaysia
Thailand
Philippines
PRC
US
Exported to :
Europe
Mexico
US
Canada
Singapore
Malaysia
Indonesia
Thailand
Philippines
Vietnam
PRC, Hong Kong
Japan
Korea
Taiwan
India
Europe
Asia
USA
Our products are exported worldwide
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Our Competitive
Strengths
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• Flexible manufacturing facilities
• Customisation is a key strength
Manufacturing Flexibility and
Products
Customization
• Sell direct to end-users of cleanroomgloves (mainly)- quick response time; good rapport, obtain earlier information on new product requirements
• Collaborate with customers on R&D and new products development
Strong Relationships
with Customers
Our Competitive Strengths
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• Pioneered nitrile gloves manufacturing in Malaysia
• Dedicated 20-men R&D team to develop customised solutions
Strong R&D Capabilities
• Integrated manufacturing facilities
• ISO9001:2000 and ISO 14001:2004 certified
• Advanced lab testing facilities certified by customers
High Quality Control and Production Standards
Our Competitive Strengths
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Financial Performance
3Q2010 and 9M2010
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3Q2010 Financial Performance
Y/E 31 Dec
3Q 2009
(RM 000)
3Q 2010
(RM 000)% Chg
Revenue 44,791 54,697 22.1%
Qty of glove (pcs) million 240.1 319.9 33.3%
Gross Profit 15,682 16,246 3.6%
Profit before Tax 11,104 10,249 7.7%
Net Profit 9,920 9,923 n.m
Gross Profit Margin 35.0% 29.7%
Net Profit Margin 22.2% 18.1%
Product Mix82.6 (nitrile) 84.6% (nitrile)
17.4% (NR) 15.4% (NR)
Cleanroom 70.5% 82.6%
Healthcare 29.5% 17.4%
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9M2010 Financial Performance
Y/E 31 Dec
9M2009
(RM 000)
9M2010
(RM 000)% Increase
Revenue 108,320 161,504 49.1%
Qty of glove (pcs) million 568.7 932.4 64.0%
Gross Profit 31,889 48,379 51.7%
Profit before Tax 20,493 32,867 60.4%
Net Profit 18,505 30,107 62.7%
Gross Profit Margin 29.4% 30.0%
Net Profit Margin 17.1% 18.6%
Product Mix77.6%(Nitrile) 84.2% (Nitrile)
22.4%(NR) 15.8% (NR)
Cleanroom 80.8% 77.8%
Healthcare 19.2% 22.2%
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Behind 9MFY10 Performance
Unit sales of gloves up 64% to 932.4 million pieces; demand from new
customers and sustained demand from regular customers
Sales of healthcare gloves up 90%; driven by demand for customised
solutions
3Q somewhat affected by weaker USD
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0
50
100
150
200
FY2007 FY2008 FY2009 9M2010
126.7141.4
155.7 161.5
Revenue (RM million)
0
5
10
15
20
25
30
35
FY2007 FY2008 FY2009 9M2010
22.824.4
29.5 30.1
Net Profit (RM Million)
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Steady Margins
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0%
10%
20%
30%
40%
FY2006 FY2007 FY2008 FY2009 9M2010
34.6% 33.9%
30.7% 31.5% 30.0%
GP Margin
0%
5%
10%
15%
20%
25%
FY2006 FY2007 FY2008 FY2009 9M2010
18.4% 18.0%17.2%
19.0% 18.6%
Net Profit Margin
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Healthy Balance Sheet
As at 30 Sep 2010(RM m)
As at 31 Dec 2009(RM m)
Current Assets 115.9 103.8
Current Liabilities 28.5 18.7
Total Assets 229.7 195.6
Total Liabilities 33.7 24.2
Shareholders Equity 196.0 171.4
Gearing 0.2% 0.5%
Cash and Cash Equivalents 53.7 47.2
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We believe in paying dividends!
2006 2007 2008 2009 2010
Dividend Per Share (Sen) 2.6 3.3 3.6 5.3 2.2(interim)
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Earnings Drivers and
Outlook
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Earnings Drivers
Cleanroom Glove Sector
Sustained demand from HDD &
semiconductor customers
Gained new customers in
Japan, Korea & US
Gained market share in
pharmaceutical industry
Healthcare Glove Sector
Established market niche in
premium healthcare gloves
Growing demand for
customised solutions
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200
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800
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1200
1400
1600
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2005 2006 2007 2008 2009 2010f
601
720780
900
1100
1800
Annual Production Capacity of gloves (million pieces)
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RIVERSTONE HOLDINGS LIMITED
Thank YouInvestor Relations & Media Contact:
Juliet Ang, NRA Capital
Tel: 6236 6895 Email: [email protected]
Hu Junli, NRA Cpital
Tel: 6236 6894 Email: [email protected]
mailto:[email protected]:[email protected]