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TRANSCRIPT
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Contents
• Our Business
• Corporate Updates
• 1HFY2009 Financial Performance
• Prospects and Market Outlook
• Growth Strategies and Plans
• Key Highlights
Our Business
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Structural Steelworks
• One of the largest steelfabrication facilities inSoutheast Asia
• Nearest competitor is onefifth the size of Yongnam
• On time delivery and withquality
• S1 category accreditation from Singapore Structural Steel Society
We are… A well-established structural steel contractor and
specialist civil engineering solutions provider
Specialist Civil Engineering
• Modular Strutting Systemmeets increasingly stringentdesign and projectrequirements
• Approximately 90,000 tons ofstrutting assets
• High replacement cost of strutsis a major barrier to entry
4
Our Business
• Over 30 years of experience in steel fabrication
• Long established relationships with major customers, who are reputable contractors:
Takenaka Corporation
Taisei Corporation
Obayashi Corporation
Penta Ocean
Shimizu Corporation
Dragages Singapore
Sembawang Engineering &
Construction Ltd
Samsung Corporation
Ssangyong Engineering &
Construction Co Ltd
Hyundai Engineering &
Construction Ltd
Daelim Industrial Co. Ltd
Woh Hup Pte Ltd
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Regional Offices
Singapore
- Yongnam Engineering &
Construction (Pte) Ltd
- YNE Project Engineering
Pte Ltd
Malaysia
- Yongnam Engineering Sdn
Bhd
- Jiwa Harmoni Offshore Sdn
Bhd
Hong Kong
- Yongnam Engineering (HK) Ltd
Thailand
- Yongnam Engineering &Construction (Thailand) Ltd
China
- Yongnam Steel Work System
Engineering (Shanghai) Co.,
Ltd
Middle East
- Yongnam Engineering & Construction (Pte) Ltd, Dubai Branch
India
- Project Office (Delhi)
Hong Kong
Malaysia
Singapore
China
ThailandMiddle East
INDIA
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Regional Projects
Projects undertaken
across the region:
Singapore
Malaysia
Middle East
China
Norway
Brunei
Philippines
Thailand
Japan
Korea
Hong Kong
Pakistan
India
Hong Kong
BruneiMalaysia
Singapore
Thailand Philippines
Japan
India
Korea
Pakistan
Middle East
China
Norway
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Structural Steelworks – Track Record
Marina Bay Sands Integrated Resort,
Singapore
Orchard Turn,
Singapore
Dubai Metro Rail, Dubai
New Delhi International Airport,
India
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Structural Steelworks – Facilities
Singapore:
Total Land Area: Approximately 76,000 m2
Workshop Covered Area: 20,250 m2
Capacity (Normal Steel Structure): 3,000 Tons per month
Malaysia (Nusajaya, Johor)*:
Total Land Area: Approximately 109,103 m2
Workshop Covered Area: 28,900 m2
Capacity (Normal Steel Structure): 3,500 Tons per month
*New fabrication factory commenced operations in September 2008
Total Staff Strength: Approximately 1,450
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Specialist Civil Engineering – Track Record
Farrer Station, Circle Line,
Singapore
Marina Bay Sands Integrated Resort,
Singapore
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Completed/Ongoing Works
PC
CD
ST
SS
SS
PC
PCPCPCPCPCPC
PC
CD
CD
CD
CD
SS SS
SS
ST
ST
ST
ST
ST
STST
ST
ST
ST
ST
PC Pre cast Projects
ST Civil Eng Works
ST
ST
STST
ST
ST
ST
ST
ST
ST
ST
ST
ST
ST
ST
ST
SS Structural Steelwork
CD Civil Defense Doors
• Total of 8 contracts worth S$302 million
• First two contracts completed
• Remaining 6 contracts:
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Corporate Updates – MBS IR
Project Expected Completion Date
South Podium End September 2009
North Podium End November 2009
ArtScience Museum End January 2010
View Corridors & Canopies End January 2010
Lion Garden Bridge &
Cooling Tower Structure
End January 2010
SkyPark End January 2010
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MBS IR – Arts Science Museum
Top surface
framing structure
Floor structure
Lift core
Bottom surface
framing structure
Lookout framing
Staircase structure
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MBS IR – Skypark
Sky Park
343m
64m
North Cantilever
Bridge 2
Tower 3 Box Girder
Bridge 1
Heavy Lifting Component
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View Corridor Bridges
& Large Canopies
Main Con – Yongnam
Steel Wt – 1,137 tons
Sky Park
Main Con – JFE
Yongnam JV
Steel Wt - 7,900 tons
Cooling Towers
Main Con - Yongnam
Steel Wt - 507 tons
Lion Garden Bridge
Main Con - Yongnam
Steel Wt - 480 tons
North Podium Steel
Decking & Strutting
Main Con – Sembcorp Punj
Llyods
Steel Wt - 17,300 tons South Podium Excavation,
Decking & Strutting
Main Con – KTC Yongnam JV
Arts Science Museum
Main Con - Penta Ocean
Steel Wt - 5,113 tons
Ongoing Projects at MBS IR
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Marina Coastal Expressway
• C485 contract worth S$185.5 million – single largest contract won by Yongnam todate
• Temporary steel pipe pile cofferdam, steel waling and strutting works
• Project scheduled for completion by June 2013 – 7% completed
Corporate Updates - MCE
• C487 contract valued at approx S$53 million
• Support construction works by main contractor, Daelim Industrial Co. Ltd, through the lease supply, fabrication, installation and removal of temporary waler, strut, splay and bracing
• Contract works scheduled for commencement in October 2009 and completion by end 2013
• C483 contract valued at approx S$23 million
• The installation and the eventual extraction of the temporary steel interlocking pipe pile earth retaining wall for the 950-metre vehicular tunnel structure
• Contract works just commenced and scheduled for completion by June 2012
Artist’s Impression
C485
C485
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Corporate Updates
New Delhi International Airport
• Completed in June 2009
Vista Xchange
• Contract worth S$88 million
• Construction of the Integrated Civic, Cultural, Retail and Entertainment Hub at Vista Xchange, located at one-north
• Construction commenced end of 2008; scheduled for completion by January 2011
• 10% completed
Artist’s Impression
• Completed:
▫ Structural steelworks and strutting works for 19 overground/underground stations in March 2009 for both Red and Green Lines
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Corporate Updates – Dubai Metro Rail
Dubai Metro Rail
• Ongoing*:
▫ Won new contract worth AED 13.3 million in April 2009 for the Entrance Canopies for two underground stations for Red Line – 80% completed
▫ Won two new contracts worth AED 84.8 million in April 2009 for Green Line:
AED 74.7 million contract for structural steelworks for 12 overground stations – 20% completed
AED 10.1 million contract for structural steelworks for 6 underground stations – 40% completed
* Three new contracts secured in April 2009 to be completed by end 2009
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Financial Highlights
1HFY2009 Highlights:
• Another quarter of commendable results
• Builds on strong first quarter performance
• Topline growth of 37.0% to S$183.2 million
• Net profit jumps 53.8% to S$20.7 million
• Structural Steelworks remains as top revenue contributor and
revenue gainer
• Net debt to equity ratio remains low at 0.7 times as at end June 2009
• Shareholders’ equity improves to S$166.9 million as at end June
2009
• Strong order book maintained – S$497 million as at end June 2009
Period ended June 30
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Financial Highlights
2QFY2008 2QFY2009 Change (%) 1HFY2008 1HFY2009 Change (%)
Revenue (S$’m) 86.3 86.4 + 0.1 133.8 183.2 + 37.0
Gross Profit (S$’m)
18.0 21.0 + 16.5 31.2 44.3 + 42.0
Profit after tax (S$’m)
8.7 10.6 +22.0 13.5 20.7 +53.8
EPS (Basic)
(Singapore cents) (1)
0.71 0.86 + 21.1 1.11 1.70 + 53.2
NAV Per Share (Singapore cents) (2)
- - - 12.14 13.64 + 12.4
Period ended June 30
(1) EPS per share was computed based on the weighted average number of shares of 1,223,722,368 for 2QFY2009 (2QFY2008:
1,217,462,983) and 1,221,480,176 for 1HFY2009 (1HFY2008: 1,217,442,983) (2) NAV per share as at December 31, 2008 and June 30, 2009 respectively
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Balance Sheet Highlights
Dec 31
2008
June 30
2009
Work-in-progress (S$’m) 120.9 139.0
Debtors (S$’m) 36.5 41.7
Cash & Bank Balances (S$’m) 40.5 17.9
Borrowings (S$’m) 123.8 135.2
Net Borrowings (S$’m) 83.3 117.3
Shareholders’ Funds (S$’m) 147.7 166.9
Order Book (S$’m) 504.0 497.0
Period ended June 30
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Revenue Growth
S$’m
Notwithstanding continuing global economic slowdown:
- 2QFY2009 Revenue 0.1%:
• Structural Steelworks increased 15.9%to S$69.9 million from 2QFY2008 mainlydue to:
• Contributions from projects such as:
• Marina Bay Sands™ Integrated Resort;
• New Delhi International Airport;
• Integrated Civic, Cultural, Retail and
Entertainment hub at Vista Xchange,
one-north.
• Specialist Civil Engineering declined36.3% to S$16.5 million from 2QFY2008 mainly due to:
• Reduced activities at Marina Bay Sands™
Integrated Resort;
• Partly offset by the commencement of
the Marina Coastal Expressway C485
project – the Group’s single largest
contract to-date at S$185.5 million.Period ended June 30
37.0%
0.1%
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Gross Profit
S$’m 2QFY2009 Gross Profit 16.5%
Due mainly to:
• Improved margins: 20.9% in 2QFY2008
to 24.3% in 2QFY2009
Period ended June 30
16.5%
42.0%
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Revenue by Business Activity
2QFY2008
2QFY2009
80.9%
19.1%
Specialist Civil Engineering
S$16.5m
Structural SteelworksS$69.9m
Period ended June 30
70.0%
30.0%
Specialist Civil Engineering
S$25.9m
Structural SteelworksS$60.3m
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Order Book
• Strong order book of S$497 million as at June 30, 2009
- Boosted by new contract wins in 1HFY2009:
• Marina Coast Expressway (C487 and C483 contracts);
• 8th contract for the Marina Bay SandsTM IR; and
• Three new contracts for the Dubai Metro – Red and Green Lines.
Period ended June 30
• Government ramping up construction spending
▫ S$18 billion to S$20 billion worth of contracts to be injected into economy this year
▫ Another S$15 to S$17 billion to be pumped in for building and infrastructure projects in 2010 and 2011 each
• Major public projects to be awarded this year include the National Research Foundation’s research campus, JTC Corp’s International School Campus at Tampines, and support facilities for Gardens by the Bay at Marina South
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Local Prospects
Committed support from Government through to 2011:
Business Times, August 11, 2009 Straits Times, March 24, 2009
• Momentum in the construction sector picked up strongly after a moderation in the first quarter
▫ The construction sector grew by 32.7% compared to 1Q2009’s 9.6%, driven by the growth in both public and private constructionactivities
Construction sector holds up in 2Q2009:
• Construction sector
shows least pessimism
• The construction
sector emerged the “star
performer” for a second
consecutive quarter
• The UAE is carrying out projects in Construction and other sectors with total value of approx. AED3.4 trillion ($930 bn)
• Every country in the region have plans for ambitious rail projects
▫ Qatar and Kuwait are spending around $10 billion each;
▫ United Arab Emirates is forking out around $20 billion; and
▫ Saudi Arabia plans to spend $15 billion to increase the size of its rail network nearly five-fold.
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Regional Prospects
Middle East:
“Making tracks: European companies hope to prosper from railway mania in the Middle East”Economist, April 23, 2009
India:• Govt intends to spend about US$500 bn on India’s
infrastructure in the five years to 2012
Amongst the budget:
▫ US$79 billion will be spent on highways and bridges
▫ US$65 billion will be spent on railways
“$930bn worth of projects underway in the UAE”Arabian Business, July 24, 2009
“India to pour billions into upgrading infrastructure”The Straits Times, July 4, 2009
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Potential Projects
• Structural Steelworks
LocationExpected
CommencementGovernment
$ Mil
Non-Government
$ Mil
Singapore2009 100.0 Nil
2010 400.0 Nil
Total 500.0 Nil
LocationExpected
CommencementGovernment
$ Mil
Non-Government
$ Mil
Singapore2010 163.0 80.0
2011 60.0 57.0
Overseas2009 Nil 60.0
2010 150.0 Nil
Total 373.0 197.0
• Specialist Civil Engineering
• Projects announced by Government (not included above):
▫ MRT Thomson Line
▫ MRT Eastern Line
▫ North-south Expressway
• Contracts for infrastructural developments such as:
MRT Downtown Line
Turbine Building – India
Singapore Sports Hub
Airport Terminal Building – Oman
Marina Coastal Expressway
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Growth Strategies and Plans
Remain focused on the two core businesses – StructuralSteelworks and Specialist Civil Engineering
Leverage on established brand name and strong foothold inthe Singapore market
Continue to explore growth potential in Middle East andIndia opportunistically