investor relations - megawide...actual 2015 actual 2014 % change 1h 2016 1h 2015 % change...

INVESTOR RELATIONS

Company Presentation As of 1H 2016

This presentation was prepared solely and exclusively for discussion purposes. This presentation and/or any part thereof may not be reproduced, disclosed or used without the prior written consent of Megawide Construction Corporation (the “Company”). This presentation, as well as discussions arising therefrom, may contain statements relating to future expectations and/or projections of the Company by its management team, with respect to the Company and its portfolio companies. These statements are generally identified by forward-looking words such as “believe”, “plan”, “anticipate”, “continue”, “estimate”, “expect”, “may”, “will”, or other similar words. These statements are: (i) presented on the basis of current assumptions which the company’s management team believes to be reasonable and presumed correct based on available data at the time these were made, (ii) based on assumptions regarding the Company’s present and future business strategies, and the environment in which it will operate in the future, (iii) a reflection o our current views with respect to future events and not a guarantee of future performance, and (iv) subject to certain factors which may cause some or all of the assumptions not to occur or cause actual results to diverge significantly from those projected. Any and all forward looking statements made by the Company or any persons acting on its behalf are deemed qualified in their entirety by these cautionary statements. This presentation is solely for informational purposes and should in no way be construed as a solicitation or an offer to buy or sell securities or related financial instruments of the Company and/or any of its subsidiaries and/or affiliates.

DISCLAIMER

2

Power* Property Construction

COMPANY BACKGROUND

Airport

4 *Expected to be folded in Q3 of 2016

Megawide (PSE: MWIDE) is a publicly listed diversified engineering conglomerate focused in Construction and Infrastructure Development.

The Largest Building Construction Company in the Country

Largest Private Airport Operator in the Philippines

Progressive Property Developer in the Country

Fast growing Pure Renewable Energy Power Generator in the Philippines

COMPANY BACKGROUND

5

ENGINEERING EXCELLENCE

As of June 30, 2016 As of Dec 31, 2015 Increase (decrease)

Consolidated Parent Consolidated Parent Consolidated Parent

ASSETS Cash & Financial Assets Trade Receivables Construction Materials Cost in Excess of Billings Other Current Assets Total Current Assets Concession Assets Property, Plant &Equipment Investments in Subs and JVs Other Non Current Assets Total Non Current Assets TOTAL ASSETS

P 10,932.74

7,474.03 475.73

2,814.27 1,897.67 23,594.44

17,795.88 4,945.10

872.91 2,780.06 26,393.94

P 49,988.39

P 9,246.10

7,606.15 475.73

2,814.27 1,768.40 21,910.65

- 4,918.98 4,054.06

268.76 9,241.80

P 31,152.45

P 9,262.98

7,805.46 292.79 3,553.70

1,580.54 22,495.46

16,369.90 4,948.12 818.79

3,882.56 26,019.38

P 48,514.83

P 9,067.63

7,963.46 292.79

3,553.70 1,463.95 22,341.53

- 4,928.22 4,023.45

245.01 9,196.68

P 31,538.21

18% (4%) 62%

(21%) 20% 5% 9% 0% 7%

(28%) 1%

3%

2%

(4%) 62%

(21%) 21% (2%) 0% 0% 1%

10% 0%

(1%)

LIABILITIES Current Loans Trade Payables Advances from customers Billings in Excess of Costs Other Current Liabilities Total Current Liabilities Non Current Loans Other Non Current Liabilities Total Non Current Liabilities TOTAL LIABILITIES

P 2,949.46

6,549.29 1,302.42

819.32 84.13 11,704.62

20,310.08 332.39 20,642.47

32,347.09

P 2,949.46

6,236.88 1,302.42

819.32 54.86 11,362.94

4,982.50 75.70 5,058.19

16,421.13

P 3,591.60

6,664.24 1,692.22 590.42

108.75 12,647.22

18,950.80 312.61 19,263.41

31,910.63

P 3,591.60

6,384.94 1,692.22 590.42

46.76 12,305.94 5,003.53

70.81 5,074.34

17,380.28

(18%) (2%)

(23%) 39%

(23%) (7%) 7% 6% 7%

1%

(18%) (2%)

(23%) 39% 17% (8%) 0% 7% 0%

(6%)

EQUITY 17,641.30 14,731.32 16,604.20 14,157.93 6% 4%

FINANCIAL POSITION – BALANCE SHEET

6

June 30, 2016 % June 30, 2015 % Movement %

REVENUES Contract Revenues Airport Operations Revenues DIRECT COSTS Contract cost Cost of airport operations GROSS PROFIT OTHER OPERATING EXPENSES OPERATING PROFIT OTHER INCOME (CHARGES) Finance Costs Finance income Others – net PROFIT BEFORE TAX TAX EXPENSE NET PROFIT

P 9,173.29 895.98 10,069.27

7,626.75

174.44 7,801.19

2,268.08 523.82 1,744.26

(321.58) 85.74

30.57 (205.27)

1,538.99

361.39 P 1,177.60

100%

77%

23% 5%

17%

3% 1% 0% 2%

15% 4%

12%

P 4,977.54 723.53 5,701.07

4,145.23

125.42 4,270.65

1,430.42

362.27 1,068.15

(263.10) 55.12

97.54 (110.44)

957.71

167.62 P 790.09

100%

75%

25% 6%

19%

5% 1% 2% 2%

17% 3%

14%

P 4,195.75 172.45 4,368.20

3,481.52

49.02 3,530.54

837.66

161.55 676.11

58.48 30.62

(66.97) 94.83

581.28

193.77 P 387.51

84% 24% 77%

84% 39% 83%

59% 45% 63%

22% 56%

(69%) 86%

61%

116% 49%

Net Profit Attributable to: Parent Company Non-controlling Interest

P 985.36 192.24 P 1,177.60

P 688.00 102.09

P 790. 09

P 297.36 90.15 P 387.51

43% 88% 49%

EPS P 0.35 P 0.23

RESULTS OF OPERATIONS – INCOME STATEMENT

7

Actual 2015

Actual 2014

% Change

1H 2016

1H 2015

% Change

Consolidated Revenues

Construction Airport Total

13,958 1,484 15,442

9,842 200

10,042

42% 642% 54%

9,173 896 10,069

4,978 723 5,701

84% 24% 77%

Consolidated EBITDA


2,059 971 3,030

1,769 90 1,859

16% 979% 63%

1,548 614 2,162

1,006 422 1,428

54% 45% 51%

Consolidated Net Income


973 501 1,474

838 49 887

16% 922% 66%

697 481 1,178

535 255 790

30% 89% 49%

RESULTS OF OPERATIONS – 1H 2016

8

Const 91%

Airport 9%

Revenue

Const 72%

Airport 28%

EBITDA

Const 59%

Airport 41%

Net Income

RESULTS OF OPERATIONS – INCOME STATEMENT

9

Gross Profit Margin

Net Profit Margin Return on Equity Earnings per Share

23%

12% 7%

0.35

25%

14%

5%

0.23

June 2016 June 2015

Profitability Ratios

RESULTS OF OPERATIONS – KEY METRICS 1H 2016

Current Ratio Quick Ratio

2.02

1.57

2.36

1.80

June 2016 June 2015

Debt-to-Equity Ratio

Interest Coverage Ratio

0.70

5.52

0.71

4.67

June 2016 June 2015

Liquidity Ratios Solvency Ratios

Net Debt-to-Equity

Ratio

As of 1H 2016 As of Dec 31, 2015

Consolidated Parent Consolidated Parent

Gross Profit Margin Construction Segment Airport Segment Consolidated

17% 81% 23%

17%

15% 77% 21%

15%

EBITDA Margin Construction Segment Airport Segment Consolidated

17% 69% 21%

17%

15% 65% 20%

15%

Net Profit Margin Construction Segment Airport Segment Consolidated

8%

54% 12%

8%

7%

34% 10%

7%

10

RESULTS OF OPERATIONS – KEY METRICS 1H 2016

Most advanced pre-cast construction facility in Asia Largest fully computerized and automated Batching Plants in the Philippines Innovative formworks system from Germany Young and modern fleet of equipment

The Megawide Engineering Excellence

11

1

CONSTRUCTION OPERATIONS 1

Taytay Precast Facility Profile

Location Taytay, Rizal

Operation Since September 2012

Land Area 200,000 sq meters

Production Area 15,000 sq meters

Max Production Capacity

66,000 cubic meters / year

Megawide is a Triple-AAA PCAB Licensed general contractor primarily engaged in civil, structural and architectural works, MEPF, and other specialty engineering services.

Megawide has constructed over 6.5 million square meters of gross floor area for most of the top companies and developers in the country.

THE LEADING CONSTRUCTION COMPANY BUSINESS IN THE COUNTRY 1

12

PPP for School

Infrastructure Project 1, 2

Phase 1 Developer

Citicore-Megawide Consortium, Inc.

Location Region III and IVA

Agreement Build-Lease-Transfer

Duration 10 Years

Phase 2 Developer

Megawide Construction Corporation

Location Regions I, II, III, CAR

Agreement Build-Transfer

Contract Cost Php 15.06 B (combined)

Southwest Integrated

Transport System

Developer MWM Terminals

Location Cavite Expressway, Paranaque City

Agreement Build-Transfer-Operate

Duration 35 Years

Project Cost Php 3.5 B

Mactan-Cebu International

Airport

Developer GMR-Megawide Cebu Airport Corporation

Location Airport Road, Lapu-Lapu City

Agreement Build-Operate- Transfer

Duration 25 Years

Project Cost Php 34 B

Upward integration from construction revenue as project proponent to

generate recurring revenues post-construction completion of operation

asset.

PPP Projects won during the Aquino Administration

13

1


7,742.13 8,204.81

10,880.44

9,842.33

13,958.49

15,745.18

Y2011 Y2012 Y2013 Y2014 Y2015 E2016

Construction Revenues

750.21

1,012.57

1,092.36

838.15

972.99 1,007.13

Y2011 Y2012 Y2013 Y2014 Y2015 E2016

Construction Income

9.7%

12.3% 12.8%

8.52%

6.97% 6.4%

Net Income Margin

4%

13%

Notes:

Y2015 Expiration of ITH

Megawide is the preferred contractor of choice for leading property

developers with its consistent track record and engineering excellence.

14

1


4,977.54

9,173.29

13,958.49

15,745.18

1H 2015 1H 2016 Y2015 E2016

Construction Revenue 13%

534.60

696.73

972.99 1,007.13

1H 2015 1H 2016 Y2015 E2016

Construction Income

7.6%

4%

30%

84%

10.7%

Net Income Margin

Order Book Mix 1H 2016

Office & Comm'l 35% Residential 47% Affordable Housing 10% Infra 7% Power 1%

15


6.97% 6.4%

Strong Construction Revenues due to higher percentage of completion and projects in superstructure phase.

Order book is a more balanced project mix of residential and low cost housing, office and commercial, infrastructure and power projects.


Megawide continues to enjoy a strong order book and has posted the highest order booking at P42.29 Bn as of end June 2015, providing revenue visibility for the next 2 years.

New contracts likewise continue to grow, as of 1H 2016 at P12.4Bn including Double Dragon’s Meridien Plaza Ph2, 10 West, St. Moritz, Megaworld’s Southeast Asean Campus and 8990’s Tondo and Cubao Projects.

16

12.90

18.80 20.30

22.63

39.06 42.29

Y2011 Y2012 Y2013 Y2014 Y2015 Jun-16

Order Book

-

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

Y2011 Y2012 Y2013 Y2014 Y2015 Jun-16

5.20

14.10 12.42

17.60

37.73

12.40

New Contracts


17

NEW PROJECTS

Project Double Dragon Corporate Office West

GFA 26,655 SQ.M

Client Double Dragon

Project Double Dragon Corporate Office North

GFA 22,309 SQ.M

Client Double Dragon

18

Project Southeast Asian Campus

GFA 84,400 SQ.M

Project One Manchester

GFA 40,000 SQ.M

Project St. Moritz Private Estate

GFA 35,841 SQ.M

Project 10 West

GFA 42,537.06 SQ.M

NEW PROJECTS


19

Project Urban Deca Tower Cubao

GFA 131,974 SQM

Client 8990 Holdings, Inc.

Project Urban Deca Ortigas

GFA 800,256 SQM

Client 8990 Holdings, Inc.

NEW PROJECTS


On April 22, 2014 the company and its JV Partner GMR won the Concession for brownfield development of Mactan-Cebu International Airport under Build-Operate-Transfer Modality. Concession Period is 25-years.

Mactan-Cebu International Airport is the 2nd Largest Gateway in the Philippines (next to NAIA). The Company took over the Operations and Maintenance of the Airport last November 1, 2014 Construction broke ground last June 30, 2015 for the construction of the new Terminal 2. Terminal 2 aims to increase

passenger handling capacity from 4.5M to 12.5M per annum. Target completion is end of 2018.

LARGEST PRIVATE AIRPORT OPERATOR IN THE PHILIPPINES 2

20

21


Connectivity: New flights as of JUNE 2016

Busan, South Korea

Taipei, Taiwan

Dubai, UAE Taipei, Taiwan & Narita, Japan

Los Angeles, USA , Osaka & Nagoya, Japan

Mactan-Cebu International Airport now connects Cebu to 23 local airports and 12 international destinations and handles as of June 2016.

2,273 2,612 2,779 3,070 3,732 3,991 4,763 5,413 6,216 6,771 6,996 7,140 7,960 8,900

10,000 11,100 11,800

Y2003 Y2004 Y2005 Y2006 Y2007 Y2008 Y2009 Y2010 Y2011 Y2012 Y2013 Y2014 Y2015 E2016 E2017 E2018 E2019

Passenger Traffic (in million) Compounded Annual Growth

Mactan-Cebu Airport handled passenger traffic of 7.97 million in 2015 Since Y2003, traffic has grown at Compounded Annual Growth (CAGR)

of 10.12%. The pace of traffic growth over the next 5 years is expected to continue at 10.34% CAGR.

22


Passenger Volume and Comparison Growth (2014 vs. 2015)

2014 2015 Increase (in %)

Domestic 5.21 5.90 13.24%

International 1.69 2.07 22.50%

Total 6.90 7.97 15.50%

Breakdown of Foreign Tourists (Year 2015)

Korea, 44%

Japan, 19%

USA, 10%

China, 8%

Australia, 4%

Germany, 3%

UK, 2%

Canada, 2%

France, 2%

Taiwan, 2%

Others, 5%

23


Since handover, the leasable space has increased by 38.5% and is

expected to further increase upon completion of Terminal 2.

Expanding Retail Stores Exciting Food & Beverage Outlets

2014

Mactan-Cebu International Airport

2015

Mactan-Cebu International Airport

Growth in Sales per Person

Suvarnabhumi Airport

Bangkok, Thailand

2x 25x

24


•Euromoney-IJGlobal Asia Pacific PPP Deal of the Year

•The Asset Triple A Infrastructure Awards Best Transport Deal – Highly Commended

•Project Finance International Asia Pacific Transport Deal of the Year

AWARDS

•Guide to Sleeping in Airports 18th Best Airport in Asia

•Partnerships Awards International •Shortlist for Best Transit Project

2014

2015

199.96

1,483.89

1,735.91

Y2014 Y2015 E2016

Airport Revenues

55.53

500.83

962.77

Y2014 Y2015 E2016

Airport Income

34%

55% 17%

92%

28%

Net Income Margin

73% 27%

Revenue Mix E2016

Aero Non Aero

Mactan-Cebu International Airport under a Build-Operate-Transfer Modality provides a recurring revenue base and high net income margin for a period of 25 years. Megawide is poised to participate in the bidding for the five (5) regional airports identified as part of the country’s PPP.

25


723.53

895.98

1,483.89

1,735.91

1H 2015 1H 2016 Y2015 E2016

Airport Revenues 17%

24% 74%

26%

Airport Revenue Mix 1H 2016

Aero Non Aero

26

AIRPORT OPERATIONS – 1H 2016 2

Passenger Traffic Volume (in Millions)

1H 2015 1H 2016 % Increase

Domestic 3.10 3.33 7% Int’l 1.00 1.18 18% Total 4.10 4.51 10%

Air Traffic Volume

1H 2015 1H 2016 % Increase

Domestic 26,860 28,681 7% Int’l 6,766 7,712 14%

Total 33,626 36,393 8%

255.49

480.87 500.83

962.77

1H 2015 1H 2016 Y2015 E2016

Airport Income

54%

88%

92%

35%

Net Income Margin 34%

55%

425.50

479.24

537.55

259.10 303.52

351.90

E2019 E2020 E2021

Lease Revenues EBITDA

61% 63%

65%

EBITDA Margin

27

PROGRESSIVE PROPERTY TRANSPORT DEVELOPER 3

SOUTHWEST INTEGRATED TRANSPORT SYSTEM

The Southwest Integrated Transport Terminal is projected to deliver a recurring income base from terminal operations, leasable retail, office, and commercial space upon project completion in end 2018.

FAST GROWING PURE RENEWABLE ENERGY POWER GENERATOR 4

Silay Solar

Power, Inc.

(Negros

Occidental)

100% 100% 100% 100% 100%

Next Generation

Power

Technology, Inc.

(Bataan)

First Toledo

Solar Energy

Corp. (Cebu)

Himamaylan

Biomass Power,

Inc. (Negros

Occidental)

Rio Norte Hydro

Corporation

(Isabela)

96.11%

Upper Maslog

Hydro

Corporation

(Eastern Samar)

28

4 FAST GROWING PURE RENEWABLE ENERGY POWER GENERATOR

Power assets

The Company currently has 3 types of power assets:

1. Operating projects - total installed capacity of 103MW Solar Power; awaiting FIT

2. Projects under advanced development - total of 110MW of mix Solar (60) Hydro Power (40) and Biomass (12) to start construction within Y2016.

3. Projects under pre-development (robust pipeline of over 20 projects with an aggregate capacity of over 800MW)

1,682

4,886

8,247

21,835

28,462

1,446

3,665

6,348

19,099

25,077

-

5,000.0

10,000.0

15,000.0

20,000.0

25,000.0

30,000.0

2017 2018 2019 2020 2021

Revenues EBITDA

83% Average EBITDA Margin

-

500

103

250

-

160

-

50

-

100

200

300

400

500

600

700

800

900

1,000

Today By 2021

Hydro Solar Biomass Wind

In the next 5 years, the Company is targeting to achieve approximately 1,000MW of RE composed of a diverse mix of sources. With this portfolio and mix, the Company is projecting to achieve over P25 billion in revenues by 2021 from a 2017 expected level of around P1,6 billion.

29


-

2,000.00

4,000.00

6,000.00

8,000.00

10,000.00

12,000.00

14,000.00

16,000.00

18,000.00

20,000.00

Y2013 Y2014 Y2015 E2016

Consolidated Revenues

Construction Revenues Airport Revenues Power Revenues

10,042

15,442

17,754

-

500.00

1,000.00

1,500.00

2,000.00

2,500.00

Y2013 Y2014 Y2015 E2016

Consolidated Income

Construction Income Airport Income Power Income

1,398

887

1,474

1,973

12.8%

8.8%

9.5%

11.1% Net

Income Margin

34%

10,880

FINANCIAL HIGHLIGHTS – Guidance Y2016

15%

30

Historical Earnings Per Share (EPS)

0.36

0.48 0.48

0.35 0.41

0.54

FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 E 2016

Megawide Core EPS

31

NOTE: Core EPS for FY2013 excludes a one-time trading gain of P306Mn.

The continued stability of the Philippines, coupled with the new Duterte Administration will further give Megawide a foundation for future growth.

BUSINESS CATALYSTS:

Increase In

Government

Infrastructure

Spending 17 identified PPP

projects, including regional

airport bundles

$30Bn OFW

Remittance and

VP Robredo’s

Focus on 1.4Mn

out of 4.65Mn

Housing Backlog

BPO Sector’s

continued growth

Demand for Office

Building contracts

DENR’s thrust:

green

consciousness

and sustainable

sources of

energy

32

5 REGIONAL AIRPORTS

PPP Projects for Bidding

BACOLOD BOHOL

DAVAO ILOILO CAGAYAN DE ORO

BUSINESS UPDATES

PRISON FACILITIES

33

Cost Php 50.18 B

Concession Build- Transfer-and-Maintain (BTM)

Cooperation Period 20 Years

Cost Php 108.2 B

Mode Operate-Add-Transfer

The Largest Building Construction Company in the Country - preferred contractor of blue chip companies

Largest Private Airport Operator in the Philippines - leading position for bidding for new airports

Progressive Property Developer in the Country - develop mixed-use anchored on infrastructure

Fast growing Pure Renewable Energy Power Generator in the Philippines – with diverse source of mix

Megawide (PSE: MWIDE) is a publicly listed diversified engineering conglomerate focused in Construction and Infrastructure Development with four core business segments:

SUMMARY

34

ENGINEERING EXCELLENCE

investor relations - megawide...actual 2015 actual 2014 % change 1h 2016 1h 2015 % change...

Documents