Hyflux LtdFY2014 Results Review

27 February 2015

Slide 1

FORWARD-LOOKING STATEMENT

This presentation has been prepared by Hyflux Ltd for the information of the attendees of this presentation.

The presentation may contain forward-looking statements which are based on current expectations, projections and

assumptions about future events. Although Hyflux believes that these expectations, projections and assumptions are

reasonable, these forward-looking statements are subject to risks, uncertainties and assumptions about Hyflux and its

business operations that could cause actual results to differ materially from those expressed or implied by these forward-

looking statements. Such risks include industry and economic conditions; currency fluctuations between the Singapore

dollar and other currencies; governmental, statutory, tax, public policy and regulatory changes; and the continued availability

of financing in the amounts and the terms necessary to support future business.

Investors are cautioned not to place undue reliance on these forward-looking statements which are based on current views

of Hyflux’s management on future events.

Any forward-looking statement in this presentation is accurate only as of the date it is issued. Hyflux has no obligation to

publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise,

except as required by law.

The presentation is not and does not constitute or form part of any offer, invitation or recommendation to subscribe for orpurchase any security and neither this presentation nor anything contained in it shall form the basis of, or be relied upon inconnection with, any contract, commitment or investment decision.

No representation or warranty express or implied is made as to, and no reliance should be placed on, the fairness, accuracy,completeness or correctness of the information or opinions contained herein. None of Hyflux Ltd or any of its affiliates,advisors or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arisingfrom any use of this document or its contents or otherwise arising in connection with this presentation.

Disclaimer

Slide 2

• FY2014 PATMI up 31%

• Strong order book of more than S$2.9 billion with new project win in

Oman

• Actively pursuing opportunities for water projects in the Middle

East, Africa, Asia and the Americas

Executive highlights

Slide 3

Slide 4

Revenue & profit

S$ mil FY2014 FY2013 % Change

Total Revenue 321.4 535.8 (40)

Other Income 170.0 10.2 > 100

PBT 53.1 51.6 3

PATMI 57.5 44.0 31

• Lower revenue was due to the timing of project commencement.

• In line with our asset recycling strategy, higher Other Income and PATMI were recorded from the divestment of the joint venture with Marmon Water LLC group in March 2014 and sale and leaseback of Hyflux Innovation Centre in June 2014.

Slide 5

Asia and municipal sector continued to be key contributors

S$ mil S$ mil

21.2 (7%) 22.4 (4%)

48.0 (15%) 47.3 (9%)

232.5 (72%)

445.1 (83%)19.7 (6%)

21.0 (4%)

0

50

100

150

200

250

300

350

400

450

500

550

FY2014 FY2013

Others

Singapore

China

MENA

269.9 (84%)

499.9 (94%)

46.4 (14%)

28.6 (5%)

5.1 (2%)

7.3 (1%)

0

50

100

150

200

250

300

350

400

450

500

550

FY2014 FY2013

Others

Industrial

Municipal

Revenue by Region Revenue by Sector

Slide 6

Expenses

S$ mil FY2014 FY2013 % Change

Raw Materials & Consumables 164 267 (39)

Staff Costs 75 73 3

Depreciation, Amortisation & Impairment 33 42 (23)

Other Expenses 120 79 52

Finance Costs 35 28 27

Total Operating & Finance Expenses 427 489 (13)

• Decrease in Raw Materials and Consumables used was in line with revenue.

• Lower Depreciation, Amortisation and Impairment was mainly due to impairment charge made in FY2013 in relation to non-core assets.

• Increase in Other Expenses was primarily driven by higher utility charges from Tuaspring Desalination Plant due to the delay in the national grid connection to our power plant.

Slide 7

Balance sheet

S$ mil 31 Dec 2014 31 Dec 2013

Net equity 1,342 886

Non-current Assets 1,903 1,776

Non-current Liabilities 1,009 1,150

Net Current Assets 448 261

Net Gearing 0.51x 1.15x

• Perpetual capital securities issued in January and July 2014 contributed to the net equity.

• Net Gearing improved to 0.51 times as at 31 December 2014 from 1.15 times as at 31 December 2013.

Slide 8

Cash flow

S$ mil FY2014 FY2013

Operating CF before SCA (15) 46

Operating CF after SCA and tax paid (226) (422)

Investing CF 206 (26)

Financing CF 210 168

Net Cash Changes 190 (281)

Cash & Cash Equivalents 444 244

SCA: Service concession arrangement

• Operating cash outflows after SCA contributed by investment in Tuaspring project.

• Cash from investing activities reflected divestment of joint venture with Marmon Water LLC in March 2014 and sale and leaseback of Hyflux Innovation Centre in June 2014.

• Cash from financing activities was largely from the proceeds of the perpetual capital securities issued in January and July 2014.

Final dividend of 1.60 Singapore cents per ordinary share proposed

Dividend per ordinary share* (Singapore cents)

Slide 9

*Dividends have been restated to reflect 1-for-2 bonus share issue in 2010

0.47

0.850.90 0.90

1.26

2.29

3.33

4.17

2.77

3.20

2.30

0.70

1.60

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

2.30

30166 254 335

1,100955 943

1,872 1,938 1,973

435435

863

1,145

748

553

931

1,025732 676

278

0

500

1,000

1,500

2,000

2,500

3,000

Dec 05 Dec 06 Dec 07 Dec 08 Dec 09 Dec 10 Dec 11 Dec 12 Dec 13 Dec 14

EPC

O&M

Order book

Slide 10

Note:1. O&M order book is a summation of future revenues of our portfolio of plants over 20-30 year concession periods.2. Dec-14 EPC order book includes Dahej desalination project. WPA was signed in January 2013.3. Dec-14 O&M order book includes Tuaspring and Magtaa projects.4. Water purchase agreement for Qurayyat project is expected to be signed by end of March 2015.

S$ mil

2,897

2,670

2,927

1,874

1,508

1,848

1,480

1,117

601465

954

Key Project Highlights

Slide 11

Slide 12

Qurayyat Independent Water Project, Oman

Artist’s impression

Designed capacity: 200,000 m3/day; 20-year concession period

Official opening of Magtaa Desalination Plant, AlgeriaDesigned capacity: 500,000 m3/day; 25-year concession period

Slide 13

Completed construction of Tuaspring Power Plant, Singapore411 MW CCGT power plant co-located with Tuaspring Desalination Plant

Slide 14

Group Outlook

Slide 15

• Cautiously optimistic of a recovery of water industry amidst a weaker oil

price environment and mixed global economic outlook.

• First half is likely to be slow, but expect a pick-up in the second half.

There may also be some opportunities in asset divestment during the

year.

• Actively pursuing opportunities for municipal and industrial water

projects in the Middle East, Africa, Asia and the Americas.

• Leverage water and power expertise to pursue infrastructure

development projects in Africa and Asia.

Group outlook

Slide 16

Global desalination market is expected to rebound in 2015

Slide 17

Source: Desaldata Webinar Oct 2014

Capital Expenditure (US$ bil)

Slide 18

Recurring gross operating income

S$ mil

Note:1. Estimates based only on existing portfolio and do not include any potential projects.2. O&M, asset returns and membrane sales for existing plants in Singapore, China and Algeria, including Tuaspring,

Magtaa, and Dahej.3. Gross operating income is approximately EBITDA.4. Actual results may vary due to external factors.

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100

120

2015 2016 2017 2018 2019 2020

Thank You

Slide 19