first quarter 2014 financial & operating results 7 may...

First Quarter 2014Financial & Operating Results

7 May 2014

2

AGENDA

• Review of Business Units

• Pilmico Foods Corporation

• Union Bank of the Philippines

• AboitizLand

• Aboitiz Power Corporation

• AEV Financials

• Q&A

3

AGENDA




• AboitizLand


• AEV Financials

• Q&A

1,883 1,977

1,795 1,851

327 426

1Q2013 1Q2014

FINANCIAL HIGHLIGHTS

REVENUE (in million pesos)

Flour Feeds Farms

4

4,005

6%

4,253

268 327

163 130

113 135

1Q2013 1Q2014


EBITDA (in million pesos)

Flour Feeds Farms

5

591544

9%

144 186

125 86

56 67

1Q2013 1Q2014


NET INCOME (in million pesos)

Flour Feeds Farms

6

339326 4%

OPERATING HIGHLIGHTS – Flour Division

7

55,678 56,314

1Q2013 1Q2014

1%

Sales VolumeIn MT

845 878

156 174

1Q2013 1Q2014

Average Selling Prices and Gross Profit

Peso/bag

Average Selling Price Gross Profit

69,832 71,526

1Q2013 1Q2014

Sales Volume In MT

Average Selling Prices and Income Over Ingredient Cost

Peso/MT

2%

OPERATING HIGHLIGHTS – Feeds Division

23,157 23,526

5,244 5,212

1Q2013 1Q2014

8Average Selling Price Income Over Ingredient Cost

2,914

3,583

1Q2013 1Q2014

Sales VolumeIn ‘000 kilos

Average Selling Prices and Gross Profit

Peso/kilo

23%

OPERATING HIGHLIGHTS – Farms Division

108 113

32 33

1Q2013 1Q2014

9

Average Selling Price Gross Profit

PROJECT UPDATES

10

FEED

S • Feedmill Expansion Iligan : June 2014 – July 2015

• Inter-Island Pier 2 : July 2014 – July 2015

ILIGAN MILLING COMPLEX

11

Feedmill 2

Inter-island Pier 2

PROJECT UPDATES

12

• Completion of Farm Expansion 2 : Increase in sow level from 6,500 to 8,360 heads completed by Q2 2014

Grow-Fin Farm 1 to 5 expansion : Mar 2014 – Oct 2014Grow-Fin Farms 6 : Jan 2014 – Jun 2014Grow-Fin Farm 7 : Sep 2015 – Feb 2016

• Farm Expansion 3 : Increase in sow level from 8,360 to 13,640 heads completed by Q2 2017

Breeder Farm 2 : Nov 2014 – Jul 2016Offsite Nursery Farm 2 : Feb 2015 – Aug 2016Grow-Fin Farm 8 to 11 : Jan 2016 – Aug 2017

• Layer Farm : Aug 2014 – Oct 2015

FARM

S

PROJECT UPDATES

13

FARM EXPANSION TIMELINE: P2 BILLION INVESTMENT

Farm/Site Name

Grow-Fin farm 1

Grow-Fin farm 2

Grow-Fin farm 3

Grow-Fin farm 4

Grow-Fin farm 5

Grow-Fin farm 6

Grow-Fin farm 7

Grow-Fin farm 8

Grow-Fin farm 9

Grow-Fin farm 10

Grow-Fin farm 11

Breeder farm 2

Nursery farm 2

Layer Farm

Farm Expansion 2 (Sow Level 8,360) : Construction of Grow-fin farms 6 & 7

Grow-fin farms 1 to 5 capacity expansion from 7,200 heads to 9,460 heads

Farm Expansion 3 (Sow Level 13,640) : Breeder farm 2, Nursery farm 2, & Grow-fin farms 8 to11

First Layer Farm : 120,000 birds capacity

Q1 Q2 Q3 Q4

2014 2015 2016 2017

Q1 Q2 Q3 Q4 Q1 Q2 Q1 Q2 Q3 Q4Q3 Q4




• AboitizLand


• AEV Financials

• Q&A

14

AGENDA

14

4,003

1,542

3M2013 3M2014

Net IncomeIn million pesos

Net income dropped on lower trading gains

61%

15

Net interest income sustained improvement on continuous expansion in earning assets & lower funding costs

262

374

88.5% 90.8%

55.0%

60.0%

65.0%

70.0%

75.0%

80.0%

85.0%

90.0%

95.0%

100.0%

100

150

200

250

300

350

400

450

500

550

YTD Mar 2013 YTD Mar 2014

Earning AssetADB in billion pesos

% to Net Assets

2,050 2,561

3M2013 3M2014

Net Interest Income In million pesos

5.13% 4.10%1.75% 1.17%

3.38%2.93%

Net Interest Margin

Average Yield Average Cost Net Interest Margin

45 bps


43%

25%

16

509 882

3,371 422

32

59

170

178

832

208

23

4

3M2013 3M2014

Non Interest IncomeIn million pesos

Service charges, fees & commissions Trading gain/losses - netFX gains/losses Dividend IncomeMiscellaneous Premium Revenue - net

Non interest income declined from exceptionally high trading gains a year ago

+73.3%

-87.5%

+84.4% +4.7%-75.0%-82.6%

4,937

1,753

65%

17

Deposits exhibited strong growth, breached Php300 billion level

196 306

10

21


DepositsADB in billion pesos

UnionBank Subsidiaries

6179

11

30.1% 24.5%

-100.0%

-80.0%

-60.0%

-40.0%

-20.0%

0.0%

20.0%

40.0%

20

30

40

50

60

70

80

90

100

110

120


Peso CASA DepositsADB in billion pesos

59%

29%

+56.1%

+2.1X

+29.5%

206

327

6280

18

15 14

1428 8

52

221213

32929

1618


Credit Portfolio – Net of ProvisionsADB in billion pesos

Mortgage Salary Loans Auto LoansCredit Card Commercial Business LineCorporate Preferreds + Corp. bonds

Credit portfolio grew on account of robust salary loan expansion

-6.7%

-37.5%

120

90 11%+12.5%

+2.0x

19

1,748 1,615

456 297

481 365

1Q 2013 1Q 2014

Operating ExpenseIn million pesos

Core Bank Taxes Subsidiaries

Operating expenses declined notwithstandingbranch network expansion

-7.6%

-34.9%

-24.1%15%

2,685

2,277

20

Key ratios reflected drop in first quarter income

33.8%

13.7%

1Q 2013 1Q 2014

Return on Equity

5.2%

1.4%

1Q 2013 1Q 2014

Return on Average Asset

2.7

1.9

3M2013 3M2014

Revenue to Expense

20

Capital ratios weakened predominantly due to net unrealized losses

17.2%

11.5%

16.6%

10.9%

Mar 2013 Mar 2014

Capital Adequacy Ratios

CAR Common Equity Tier 1

21

50%

70%

90%

110%

130%

150%

Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14

Re-based Stock Performance3/31/2013 – 3/31/2014

UnionBank PSEi PFINC

Source: Bloomberg, 3/31/13= 100

Share price continues to outperform PSE and Financial indices




• AboitizLand


• AEV Financials

• Q&A

24

AGENDA

163293

90

358

8

13

1Q 2013 1Q 2014

Commercial

Industrial

Residential

262

664


154% Revenue growthFrom 100% addition of Lima Land & higher

Residential revenue

REVENUES (in Php millions)

24

154%

113 135

101

135

86

193

1Q 2013 1Q 2014

Condo

House & Lots

Lots

300

46354%


Uptick in Residential sales driven by The Persimmon Studios

SALES (in Php millions)

25

121

1Q 2014

NIATNIAT


EBITDA (in Php millions)

124% EBITDA Growth

NIAT (in Php millions)

181% NIAT Growth

26

124% 181%

HIGHLIGHTS

27

RESIDENTIAL

The construction of The Persimmon Studios (condo), Almiya (H&L) and Priveya Hills (lots) is in full swing.

COMMERCIAL

• Sustaining growth in occupancy, presently at an average of 74%.

• Outlets now at 86% occupancy over 1 quarter of operations.

INDUSTRIAL

Lima Land was fully acquired in Feb 2014.

GROWTH PLANS ON TRACK

27

RESIDENTIAL

To launch phase 2 of Pristina North Residences on May 22 (High-end H&L subdivision)

COMMERCIAL

In the process of expanding Outlets at Pueblo Verde.

SM Hypermarket and Jollibee soon to open at Pueblo Verde.

INDUSTRIAL

Development of 150 hectare expansion of Lima Technological Center started.


27

CEBU DISTRICT PROPERTY ENTERPRISE INC.

• The recently incorporated 50-50 JVC with Ayala Land Inc. is now set to proceed with the planning of the 15-hectare mixed use development in MandaueCity, Cebu

31


31

2014 CAPEX targeted at 5.4 B 2014 1Q CAPEX spent at 1.4 B

87%

13%

0.34%

2014 CAPEX

Land Acquisition

Project Dev't

Other Initiatives

5.4 B

AGENDA




• AboitizLand


• AEV Financials

• Q&A

32

NET INCOME (in million pesos)

33

4,179EPS = P0.579%

-10%

-17%

DistributionGeneration AP Parent & Others

4,595EPS = P0.62

749 618

3,971 3,561

1Q2013 1Q2014

34

CORE NET INCOME (in million pesos)

749 618

3,879 3,785

1Q2013 1Q2014


Non-Recurring Items1Q2013 1Q2014

AP Parent (31) 12 AP- Gen 92 (223)

62 (211)

4,389EPS = P0.60

3%

-2%

-17%

4,533EPS = P0.62

35

BENEFICIAL EBITDA (in million pesos)

1,228 1 ,108

6,471 7,531

1Q2013 1Q2014

8,608

13%

+16%

-10%

7,634


OPERATING HIGHLIGHTS: GENERATION

36

ENERGY SALES BREAKDOWN (GWh) CAPACITY SALES BREAKDOWN (MW)

1,472 1,743

476 445

502 501

1Q2013 1Q2014

Energy contracts Capacity contracts Spot market

2,6882,450

1,780

10%

Peso/kWh 1Q 2013 1Q 2014

Bilateral 4.85 5.16

Spot Market 3.80 4.40

517 497

610 894

233

232 59

156

1Q2013 1Q2014

Energy contracts Capacity contracts

Spot market Ancillary

1,419 25%

OPERATING HIGHLIGHTS: 1Q2014 WESM HIGHLIGHTS

37

Source: WESM, SNAP

WESM TIME WTD AVERAGE PRICES (P/MWh) – Luzon Grid

169 214

1Q2013 1Q2014

OPERATING HIGHLIGHTS: HYDRO

38

ATTRIBUTABLE ENERGY SALES (GWh)

CONTRACTED ENERGY (GWh), at 100%

SPOT MARKET (GWh), at 100%

NET CAPACITY SOLD FACTOR

27%

1Q2013

1Q2014

58

12 7

42 26

55 13 7

79 91

Hedcor Sibulan HEDCOR LHC SNAP Magat SNAP Benguet

79

36

91

11

SNAP Magat SNAP Benguet

63%

13%21%

33%40%

55%

14% 21%

56% 64%

Hedcor Sibulan HEDCOR LHC SNAP Magat SNAP Benguet

39

ANCILLARY SERVICES – Nomination and Acceptance (GW/h)


-

50

100

150

200

250

300

350

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Nominated Ancillary Accepted Ancillary

2013 2014

Source: SNAP Magat & SNAP Benguet


40

SNAP MAGAT & SNAP BENGUET ANCILLARY SERVICES (at 100%)

Ancillary Revenues(in million pesos)

Accepted & Billed Capacity(in GW/h)

SNAP Magat

SNAP Benguet

132 268

122

217

1Q2013 1Q2014

580 722

535 584

1Q2013 1Q2014

1,306

254

485

17%91%

1,115

1Q 2013 1Q 2014

Peso/kWh 4.39 2.69

41

MAGAT’S WATER LEVEL VS. RULE CURVE (in MASL)


OPERATING HIGHLIGHTS: GEOTHERMAL

42

Energy Sales(in GWh)

Average Selling Prices (P/kWh)

Steam Vented (GWh)

AP RENEWABLES (Tiwi-Makban)

BCQ

WESM

Capacity Sold Factor

554 527

218 235

1Q2013 1Q2014

1%772 762

89% 88%

4.75 4.87

2.96 3.18

4.25 4.35

1Q2013 1Q2014

BCQ WESM WTD Ave

Steam & Purchased Power -P1.11/kWh

Steam & Purchased Power -P1.72/kWh

4.1 4.1

1Q2013 1Q2014

43

OPERATING HIGHLIGHTS: COAL

Attributable Energy Sales

ENERGY SALES (GWh)

CAPACITY SOLD FACTOR

397

1,024

371

1,257

192

1,251

366

1,413

STEAG TLI CEDC

12%

1Q2013

1Q2014

95%

88%92%

96% 98%

87%

STEAG TLI CEDC

44

OPERATING HIGHLIGHTS: COAL

4.29

5.65

4.51

BCQ WESM WTD Ave

4.40 4.24 4.37

BCQ WESM WTD Ave

THERMA LUZON (Pagbilao)

Energy Sales(in GWh)

BCQWESM

807 1,047

216

204

1Q2013 1Q2014

22%

1Q2014 Average Selling PricePeso/kWh

Coal + Energy Fee + Purchased Power = P1.64/kWh

1Q2013 Average Selling PricePeso/kWh

Coal + Energy Fee + Purchased Power = P1.95/kWh

1,024

1,251

45

OPERATING HIGHLIGHTS: OIL

ENERGY SALES (GWh)

AttributableEnergy Sales

CAPACITY SOLD FACTOR

18%

0 16 32 78

138

183 253

40 28 30 68

133 187

299

Therma Mobile EAUC CPPC SPPC WMPC Therma Marine

1Q2013

1Q2014

66%96% 100% 100% 91%100%

71%95% 100% 100% 96%

Therma Mobile EAUC CPPC SPPC WMPC Therma Marine

PEAK DEMAND (MW)

OPERATING HIGHLIGHTS: DISTRIBUTION

46

BENEFICIAL POWER SALES (Gwhr)

BENEFICIAL GWH SALES GROWTH(BY CUSTOMER TYPE)

2,790 3,142 3,322 3,606 3,727 3,934 4,076

956 1,000

2007 2008 2009 2010 2011 2012 2013 1Q2013 1Q2014

5%

256

700

956

253

747

1,000

Residential Commercial & Industrial Total Power Sales

1Q2013 1Q2014

5%

1%

7%

3%

296 416

23 90 80

20 32

957

323 409

22 95 86

21 28

985

DLPC VECO CLPC SFELAPCO SEZ MEZ BEZ Total

1Q2013 1Q2014

OPERATING HIGHLIGHTS: DISTRIBUTION

47

SYSTEMS LOSSGROSS MARGIN / KWH SALE

SFELAPCOSEZC DLPC VECO CLPCMEZC BEZC

1.21 1.16

1.25

1.44

1.60

1.77

1.53

2008 2009 2010 2011 2012 2013 1Q2014

* Year-to-date

*

1Q2013

1Q2014

Gov’t Cap – 8.50%

1% 2%

5 %

2%

8. 0%8. 7% 8. 5%

1% 1%

4%

5%

7.4% 8.0%

8.2%

FINANCIAL CONDITION

48

BALANCE SHEET(In million Pesos)

Cash and Equivalents

YE2013

Total Assets

Total Interest Bearing Debt

Total Liabilities

Net Debt

Total Equity

Current Ratio

Net Debt to Equity

13,803

79,107

-

12,486

-

66,621

1.2x

0.2x

Investments and Advances 64,573

1Q2014

16,004

81,618

-

12,460

-

69,158

1.3x

0.2x

64,950

PARENT

YE2013

31,383

193,939

78,491

102,688

47,107

91,251

2.9x

0.5x

25,330

1Q2014

34,601

200,193

81,253

104,761

46,652

95,432

3.2x

0.5x

25,257

CONSOLIDATED

49

Project Update

FIVE YEAR PROJECT PIPELINE TO SECURE LONG-TERM GROWTH

LUZON GRID VISAYAS GRID MINDANAO GRID

Sabangan Hydro 14 MW (2015)

Pagbilao Coal 400 MW* (2017)

Maris Canal 8 MW (2017)

Subic Coal 600 MW** (2017)

Cebu Coal 300 MW Davao Coal 300 MW (2015)

Davao Coal 3rd Unit 150 MW

Manolo Fortich 68 MW

Tamugan 12 MW (2016)

Note:s:*AP has 50% stake**AP has 25% stake




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50

AGENDA

CONSOLIDATED PROFIT & LOSS (In Million Pesos)

51

Revenues

Equity Earnings

EBITDA

Net Income

1Q2013 1Q2014 % Change

17,792 25,740 45%

9,257 9,637

-45%2,763 1,524

4%

6,849 4,868 -29%

Core Net Income 5,529 4,398 -21%

3,530 3,212

1,794

731

325

339

1Q2013 1Q2014

NET INCOME (In Million Pesos)

52

29%

Power Banking Food Parent & OthersReal Estate

4,868EPS = P0.88

6,849EPS = P1.24

CORE NET INCOME (In Million Pesos)

53

Power Banking Food Parent & OthersReal Estate

3,483 3,375

1,794

731

325

339

1Q2013 1Q2014

4,398EPS = P0.8021%

5,529EPS = P1.00

Non-Recurring Items1Q2013 1Q2014

AEV Parent net unreal FX gain - (1.1) Net unreal FX gain (loss) 118.6 (162.3) AEV gain on sale of ABOJEB/CICTI - 634.0 AEV/PFC gain on sale of CSB 1,272 - AP Parent/HSI loan preterm costs (71.2) -

1,319.5 470.6

1Q2013 1Q2014

EBITDA (In Million Pesos)

54

9,257

8,395

9,637

8,260

EBITDA (Consolidated) EBITDA (Beneficial)

4%2%

9,191 9,191

YE 2013 1Q 2014

3,346

2,764

YE 2013 1Q 2014

PARENT NET DEBT (In Million Pesos)

Parent net debt increased by 10%

Cash & Equivalents

Long-term Debt

55

-17%

5,845

6,427

YE 2013 1Q 2014

CONSOLIDATED BALANCE SHEET / KEY RATIOS

56

(In Million Pesos, except ratios)

Cash and Cash Equivalents

YE 2013 1Q 2014 % Change

Total Assets

Total Liabilities

Total Equity

Book Value Per Share

Current Ratio

Debt to Equity

Net Debt to Equity

36,118

247,088

124,539

122,549

17.55

2.64x

1.02x

0.48x

39,396

253,378

125,489

127,889

18.45

2.93x

0.98x

0.46x

9%

3%

1%

4%

Equity Attributable to Parent 96,927 101,870 5%

ANNEX A: EARNINGS CONTRIBUTION (In Million Pesos)

57

Aboitiz Power Corp.

Union Bank

AboitizLand

1Q2013 1Q2014

3,530 3,212

1,794 731

43 121

% Change

-9%

-59%

6,849 4,868 -29%Net Income

Parent & Others 1,156 466

5,529 4,398 -21%Core Net Income

Pilmico 325 339 4%

-60%

181%

58

AGENDA




• AboitizLand


• AEV Financials

• Q&A

First Quarter 2014Financial & Operating Results

7 May 2014

first quarter 2014 financial & operating results 7 may...

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