UMW HOLDINGS BERHAD
BEYOND BOUNDARIESUMW HOLDINGS BERHADCORPORATE PRESENTATION
JANUARY 2020
UMW HOLDINGS BERHAD
OUR BUSINESSDIVERSIFIED PORTFOLIO
AUTOMOTIVE EQUIPMENT MANUFACTURING & ENGINEERING
LANDBANK
• Manufacture• Assembly• Distribution• Sales & service
• Distribution• Trading• Leasing• After-sales
service
• Manufacture of fan case
• Manufacture of automotive components
• Blending & distribution of lubricants
• Unlocking value of our vast landbank in Serendah
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UMW HOLDINGS BERHAD
OUR STRENGTHLEADER IN OUR CORE BUSINESS SEGMENTS
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• Leader in the Malaysianautomotive industry with49.1% market share (2018)through Toyota, Lexus andPerodua marques.
• First Malaysian company tomanufacture and assemblefan cases for Rolls-Royce asa Tier 1 supplier.
• Manufacture and exportKYB shock absorbers to 38countries from Malaysia.
• Distribute Komatsu heavyequipment in 5 countries inthe Asia-Pacific region.
• Hold more than 50% marketshare for Toyota forklift inMalaysia and Singapore; haveoperations in 5 countries inAsia-Pacific.
AUTOMOTIVE EQUIPMENT MANUFACTURING & ENGINEERING
UMW HOLDINGS BERHAD
OUR REVENUE AND PBT CONTRIBUTIONSEGMENTAL BREAKDOWN
* Excluding Aerospace sub-segment (within Manufacturing & Engineering) which was loss-making due to start-up operations
81% 81% 81% 81% 79%
13% 14% 13% 13% 14%
6% 5% 6% 6% 7%
86%78%
72% 71% 72%
13%20%
21% 22% 21%
1% 2%7% 7% 7%
R E V E N U E P B T R E V E N U E P B T R E V E N U E P B T R E V E N U E P B T R E V E N U E P B T
Automotive Equipment Manufacturing & Engineering
*
2014 2015 2016 2017 2018
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**
UMW HOLDINGS BERHAD 5
OUR INTERNATIONAL PRESENCE12 KEY MARKETS
CREDIT RATING
China
Malaysia
Indonesia
Myanmar
Brunei
Papua New Guinea
Singapore
AutomotiveEquipmentManufacturing & Engineering
Vietnam
18,342WORKFORCE
AA2RAM Ratings
* Key markets and Workforce are inclusive of UMW and Perodua
FijiSri Lanka
Mauritius
Seychelles
UMW HOLDINGS BERHAD 6
OUR SHAREHOLDERSAS AT 31 DECEMBER 2019
FTSE4Good Bursa Malaysia Index constituent
Bloomberg ticker UMWH:MK
Total number of shares 1,168,293,932
Bursa Malaysia Listing sector Main Market, Consumer Products & Services
60.55
5.31
6.9115.80
11.43
31/12/2019
Market Capitalisation
RM5.2b
PNB
EPF
Other Local Shareholders KWAP
Foreign Shareholders
Permodalan Nasional Berhad & PNB Managed Unit Trust Funds, 60.55%
Employees Provident Fund Board, 11.43%
Foreign Shareholders, 5.31%
Other Local Shareholders, 15.88% Kumpulan Wang Persaraan(Diperbadankan), 6.91%
UMW HOLDINGS BERHAD
AUTOMOTIVESEGMENT
UMW HOLDINGS BERHAD 8
AUTOMOTIVE SEGMENTSTRUCTURE
UMW Toyota Motor Sdn. Bhd.*
Manufacturer and dealer in component parts including engines, couplings and transmission components
Perodua Engine Manufacturing Sdn. Bhd.
Perodua ManufacturingSdn. Bhd.
Perodua Sales Sdn. Bhd.
30%
Toyota BoshokuUMW Sdn. Bhd.
Automotive Industries Sdn. Bhd.
Assembly Services Sdn. Bhd.
Perusahaan Otomobil KeduaSdn. Bhd.**
Manufacturer and assembler of motor vehicles and other related activities
Investment holding and provision of management and administrative services
Marketing and distribution of motor vehicles, related spare parts and other related activities
Manufacturer of car seats, door trims, headlining, etc.
Manufacturer and supplier of exhaust systems
Assembler of vehicles
Ingress Technologies Sdn. Bhd.
Manufacturer of complete door assemblies and press parts
UMW Toyotsu Motors Sdn. Bhd.
Sales and service of Toyota and Lexus vehicles and parts
65%
100%
100%
49%
49%
49%
100%
30%
Investment holding, importation and distribution of Toyota vehicles and related parts
Investment holding and provision of management and administrative services
39% Toyota Motor Corporation10% Toyota Tsusho Corporation
** 4.2% Mitsui & Co., Ltd2.8% Mitsui & Co., ( Asia Pacific) Pte Ltd5% Daihatsu (Malaysia) Sdn Bhd
30% Toyota Capital MalaysiaSdn. Bhd.
Hire purchase financing of Toyota customers
*
51% 38%
51%
51%
******* 41% Daihatsu Motor Co., Ltd6% Mitsui Co., Ltd 4% Mitsui & Co., ( Asia Pacific) Pte Ltd
Perodua Global ManufacturingSdn. Bhd.49%
51%
Daihatsu Perodua Engine Manufacturing Sdn. Bhd.
49% 51% Daihatsu Motor Co., LtdManufacturer of engine and engine components for Energy Efficient Vehicles
Manufacturer and assembler of motor vehicles and other related activities
Perodua Auto Corporation Sdn. Bhd.***
UMW HOLDINGS BERHAD 9
UMW GROUPMARQUES AND MODELS
COMPLETELY KNOCKED-DOWN (CKD)
YARISVIOS INNOVA RUSHFORTUNER HIACEHILUX
CAMRY COROLLA C-HR AVANZA ALPHARD VELLFIRE HARRIER
ESLS NX RX LX LC
AXIAMYVI ALZAARUZBEZZA
COMPLETELY BUILT-UP (CBU)
COMPLETELY BUILT-UP (CBU)
COMPLETELY KNOCKED-DOWN (CKD)
THAILAND JAPANINDONESIA
UMW HOLDINGS BERHAD
548,115 536,905
605,156 600,123627,753
655,793 666,465 666,674
580,124 576,625 598,714 600,000
12.5%
-2.0%
12.7%
-0.8%
4.6% 4.5%1.6% 0.0%
-13.0%
-0.6%
3.8%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019T
Unit sales % Growth Year-on-Year
TOTAL INDUSTRY VOLUME (TIV)MALAYSIA AUTOMOTIVE ASSOCIATION (MAA)
Low industry growth due to no end-of-life policy, no scrap policy, high car ownership in Malaysia
MAA forecasted a marginal TIV growth in 2019, with a sales target of 600,000 units. As at November 2019, TIV stood at 549,445 units.
11M19:549,445 units
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UMW HOLDINGS BERHAD
101,839
82,08991,990 88,662
106,62292,521
103,63695,861
65,110 70,445 66,562 72,000
18.6%15.3% 15.2% 14.8%
17.0%14.1%
15.6% 14.4%11.2% 12.2%
11.1%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019T
Unit sales Market Share
UNIT SALESUMW TOYOTA MOTOR - TOYOTA AND LEXUS MODELS
Importation of CBU vehicles and CKD components are transacted in US Dollar.
UMWT launched the all-new Vios, Yaris and Corolla in 2019.
Vios and Yaris are produced at UMWT’s new Bukit Raja plant whilst the Corolla is a CBU model from Thailand. Vios and Yaris share the same platform, with local content above 80%.
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11M19:61,842 units
UMW HOLDINGS BERHAD
167,393 166,736188,641 179,989 189,137 196,071 195,579
213,307 207,110 204,887227,243 235,000
30.5% 31.1% 31.2% 30.0% 30.1% 29.9% 29.3%32.0%
35.7% 35.5% 38.0%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019T
Unit sales Market Share
UNIT SALESPERODUA – 38%-OWNED ASSOCIATE
Perodua maintained its No.1 position in overall market share for the 14th consecutive year in 2019.
The all-new 7-seater SUV, Perodua Aruz was launched in January 2019. Enhanced Perodua Axiawas introduced in September 2019.
Exports to 7 countries - Indonesia, Singapore, Mauritius, Fiji, Sri Lanka, Brunei and Seychelles.
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11M19:221,984 units
UMW HOLDINGS BERHAD
AUTOMOTIVE INDUSTRY – MARKET SHAREYEAR-TO-DATE NOVEMBER 2019
UMW HOLDINGS BERHAD
40.4%
11.3%
48.3%Brand 11M19 2018
Units Market Share %
Units Market Share %
HondaProtonNissanMazdaOther brands
78,18389,06619,11510,75068,505
14.216.2
3.52.0
12.4
102,28264,74428,61016,03893,235
17.110.8
4.82.7
15.6
Total TIV 549,445 598,714
2018227,24338.0%
201866,56211.1%
2018304,90950.9%
Perodua221,984
UMW Toyota61,842
Others265,619
Source: Malaysian Automotive Association
Other Carmakers’ Sales and Market Share
• UMW Group sold 283,826units in 11M19 with a market share of 51.7% (2018 – 49.1%)
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UMW HOLDINGS BERHAD
Private consumption have normalized towards its long-term average trend after the exceptional period duringthe GST-free phase of June to August 2018.
Sustained private consumption growth could underpinTIV growth in 2020598,714 600,000
612,000
2018 2019F 2020F
Malaysia TIV 2018-2020F (units)
Source: MAA
INDICATORS
7.1 6.9 6.6 7.9
8.9 8.4 7.6 7.8 7.0
3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19
Real private consumption growth(% y-o-y)
AUTOMOTIVE INDUSTRY OUTLOOKAUTO SALES GROWTH LARGELY DEPENDS ON THE STATE OF THE ECONOMY
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UMW HOLDINGS BERHAD 15
Expansion of model line-up1 Higher localisation 1
2 Higher automation
Improve Competitiveness Cost optimisation
3 Highly-efficient Bukit Raja plant3 Collaboration with dealers to
boost after-sales4 Network rationalisation
UMW TOYOTA MOTOROPTIMISE COSTS WHILE ELEVATING REVENUE
2 Attractive financing packages –in partnership with Toyota Capital
• 4 new SUV models• Market share of 12%2020
UMW HOLDINGS BERHAD
• 9-year financing plan – 3-tier step-up • Currently for Yaris, Vios, Avanza and Hilux – with plans for other models• Mainly to target first time buyers
TOYOTA EZ BELI CAMPAIGN
UMW TOYOTA MOTORATTRACTIVE STEP-UP FINANCING PACKAGES
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UMW HOLDINGS BERHAD 17
Ride on Perodua’s success in the entry-level segment
• Perodua introduced an all-new SUV model, Aruz in January 2019
2Strategic planning of future car models
• To ensure it can compete effectively against its direct competitors
1
PERODUALEVERAGE ON EXCELLENT BRAND PERCEPTION FOR ENTRY-LEVEL SEGMENT
• Enhanced Perodua Axia was introduced in September 2019
• Facelift Perodua Bezza to be launched in early 2020
UMW HOLDINGS BERHAD
FINANCIAL HIGHLIGHTSAUTOMOTIVE
* PBT includes contribution from Perodua
Revenue (RM million)
PBT *(RM million)
11,498.110,023.0
10,766.0 10,722.0
8,451.0 8,972.2 8,946.7
2012 2013 2014 2015 2016 2017 2018
1,796.8
1,413.5 1,475.3
860.9
496.9 446.1 550.0
2012 2013 2014 2015 2016 2017 2018
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UMW HOLDINGS BERHAD
EQUIPMENTSEGMENT
UMW HOLDINGS BERHAD 20
EQUIPMENT SEGMENTDISTRIBUTOR OF GLOBALLY-KNOWN BRANDS IN SOME PARTS OF THE REGION
HEAVY EQUIPMENT
INDUSTRIAL EQUIPMENT
Material handling
Marine & Power
• Agriculture• Construction• Forestry• Mining
• Industrial and manufacturing
• Industrial cleaning- food and
beverage material
handling logistics
• Industrial and marine power solutions
UMW HOLDINGS BERHAD
HEAVY EQUIPMENTSTRUCTURE
UMW Komatsu Heavy Equipment Sdn Bhd
UMW Corporation(74%)
Komatsu Ltd(26%)
Myanmar
Papua New Guinea
Malaysia
Singapore
Since 1965
Brunei
Since 1979
Since 1996
Principal-distributorship relationship between UMW and
Komatsu began
1965
Oct 2018
Joint-venture agreement between UMW and Komatsu
begins
Also distributes:
2018 Revenue contribution
Malaysia, 42%
Myanmar, 38%
PNG, 17%
Singapore, 3%
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UMW HOLDINGS BERHAD
Toyota Forklift Franchise – UMW is one of the Top 10 distributors globally
Malaysia
Vietnam
Brunei
Singapore
China : Shanghai,Zhejiang
No. 1 position in Malaysia since 1972. Toyota forklift maintained its 50% market share in Malaysia’s material handling equipment business.
Under the 2018 Toyota Material Handling International (TMHI) Award Programme, UMW Industries was awarded the Diamond Club Recognition, President’s Award (Gold) and Vision 2020 Award.
Have ventured into leasing of Toyota forklifts – about 9,000 units in the region.
Strong market leadership position
Since 1965
INDUSTRIAL EQUIPMENTMATERIAL HANDLING
Malaysia, 46%
Singapore, 39%
Vietnam, 12%
China, 3%
2018 Revenue contribution
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UMW HOLDINGS BERHAD
INDUSTRIAL EQUIPMENTMARINE & POWER
Compressors
Generators
Marine Engines
Oil spill equipment
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UMW HOLDINGS BERHAD
EQUIPMENT INDUSTRY OUTLOOKPOCKETS OF OPPORTUNITIES
HEAVY EQUIPMENT
• The higher allocation in development expenditureduring Budget 2020 could accelerate implementationof projects
• Singapore’s healthy pipeline of public and privatesector projects should drive the construction sectorrecovery and support sales of heavy equipment in thecountry
2.6%0.3% 0.5%
-1.5%4Q18 1Q19 2Q19 3Q19
Construction sector growth in Malaysia (% y-o-y)
MY
-1.2%2.7% 2.8% 2.9%
4Q18 1Q19 2Q19 3Q19
Construction in Singapore (Real growth)
SG
INDICATORS
INDUSTRIAL EQUIPMENT• The US-China trade conflict could provide opportunities
for ASEAN countries, especially in the manufacturingsector
Approved manufacturing investments in Malaysiasurged to RM33.1 bn in 1H19
• The Singapore’s Ministry of Trade & Industry expects themanufacturing sector to return to positive growth in 2020
1933.1
1H18 1H19
Approved manufacturing investments in Malaysia (RMbn)
MY
4.6%-0.4%
-3.3%-1.7%
4Q18 1Q19 2Q19 3Q19
Manufacturing in Singapore (Real growth)
SG
INDICATORS
Source: MIDA
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UMW HOLDINGS BERHAD 25
EQUIPMENT SEGMENTSECTORAL SHIFT; EXPANSION OF PRODUCTS AND SERVICES
HEAVY EQUIPMENT INDUSTRIAL EQUIPMENT
1 Focus on more urbanised sectors –construction & mega infrastructure projects
Venture into leasing business model and equipment-as-a-service
6
Further expansion into the leasing business model
1
Ride on the urbanisation of Vietnam
2
Expand product line-up3
Leverage on Papua New Guinea’s gold mining and construction sectors
2
Implement extended warranty programme and maintenance service contract
Projects Est. cost
Penang Transport Master Plan RM32bn
Klang Valley MRT Line 3 (MRT3) RM20bn
KL-Singapore High Speed Rail RM20bn
East Coast Rail Link sub-contracts RM18bn
Pan Borneo Highway Sabah RM13bn
Bandar Malaysia infrastructure RM21bn
Projects Est. cost
Sarawak Coastal Highway RM5bn
Sarawak Second Trunk Road RM6bn
Sarawak Water Grid Phase 1 RM8bn
Labuan Bridge RM4bn
Johor BRT RM3bn
Kota Kinabalu Water Supply Scheme RM3bn
Source: Affin-Hwang Research
Provision of value-added services4 Diversify product base3
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UMW HOLDINGS BERHAD
FINANCIAL HIGHLIGHTSEQUIPMENT
Revenue (RM million)
PBT(RM million)
2,138.5
1,705.5 1,767.2 1,882.6
1,382.8 1,458.9 1,539.6
2012 2013 2014 2015 2016 2017 2018
183.5195.8
218.2 226.5
145.6 141.8160.1
2012 2013 2014 2015 2016 2017 2018
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UMW HOLDINGS BERHAD
MANUFACTURING & ENGINEERING
SEGMENT
UMW HOLDINGS BERHAD
MANUFACTURING & ENGINEERING SEGMENTKEY PRODUCTS
Aerospace Component
Auto Components
Lubricants
Aero Engine Fan CasesContract Manufacturer for
Shock Absorbers Auto parts
Motorcycle suspension units
Shock Absorbers
• For both OEM and REM markets.• Export to more than 38 countries
from Malaysia.
Engineering plastic
• Oil Filters, Eco Filters & Fuel Filters
• Air Filters & Cabin Filters• Hydarulic & ATF Filters• Brake pads• Brake Fluid & Long-life
Radiator Coolant• Auto Transmission Fluid
• Cam Cover or Cylinder Head Cover• Air Intake Manifold• Charcoal Canister• Integrated Air Cleaner Assembly
UMW’s proprietary lubricant brand.
Premium range of Repsol lubricants for the automotive industryacross Asia and Southeast Asia Region
Cylinder Head Cover
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UMW HOLDINGS BERHAD
MANUFACTURING & ENGINEERING SEGMENTMANUFACTURE OF AERO ENGINE FAN CASES
Component Part Manufacturing for RR’s Most Advanced Passenger Aircraft Engines
Part of Rolls-Royce’s Asian Supply Chain
Single Source Final Assembly of the Trent 1000 and Trent 7000 engines in Singapore
• UMW is the 1st Malaysian Tier 1 Supplier to Rolls-Royce -single-source supplier of fan cases for Trent 1000, with production for Trent 7000 engines expected in 4Q20
• Long-term contract of 25+5 years; signed in 2015
• The manufacturing plant is located in Serendah, Selangor
UMW Aerospace Sdn Bhd
29 Nov 2017 Delivery of the first fan case
2020 – Production ramp-up to continue
2019Ramp-up production
Milestones
Delivered more than 150 units
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UMW HOLDINGS BERHAD 30
MANUFACTURING & ENGINEERING SEGMENTINDUSTRY OUTLOOK
AUTO COMPONENTS• Local indicators suggest stable demand for
auto parts in Malaysia, underpinned byhealthy private consumption.
• Growth in the automotive industry willsustain demand for lubricants, autocomponents.
4.4
7.5
4.6 4.3 4.53.5
2Q18 3Q18 4Q18 1Q19 2Q19 3Q19
Sale of Motor Vehicle Parts & Accessories inMalaysia (%, y-o-y)
Source: DoSM
• Production ramp-up is progressing well as per scheduled orders from Rolls-Royce.
• Production of Trent 7000 fan case scheduled to commence in 4Q20.
• Combine production of Trent 1000 and Trent 7000 fan cases are expected to drive the volume beyond break-even in 2020.
AEROSPACE
UMW HOLDINGS BERHAD 31
MANUFACTURING & ENGINEERING SEGMENTEXPANDING AND STRENGTHENING OPERATIONS
Commencement of KYB-UMW’s plant expansion and modernisation &improve synergies with UMWT and Perodua
01
02
03
Expansion of dealership network
05
04
Enhance position in aerospace business & entry into other High-ValueManufacturing sectors
Continuous margin improvement efforts
Development of our own products
UMW HOLDINGS BERHAD
FINANCIAL HIGHLIGHTSMANUFACTURING & ENGINEERING
Revenue – exited automotive components manufacturing business in India in late 2015.PBT – Losses in automotive components manufacturing business in India (2013); Start-up losses at Aerospace sub-segment (2017)
Revenue (RM million)
PBT(RM million)
680.7735.5 725.1 707.5
601.5 645.1
843.2
2012 2013 2014 2015 2016 2017 2018
9.9
-39.2
14.8 16.824.6
-17.7
21.5
2012 2013 2014 2015 2016 2017 2018
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UMW HOLDINGS BERHAD
LANDBANK IN SERENDAH
UMW HOLDINGS BERHAD
UNLOCKING VALUE OF OUR ASSETSMONETISING LONG-HELD ASSETS
Close to 40 acres of UMW’s land in Serendah have been taken up so far
We are actively negotiating with interested parties and hope to close some deals soon.
UMW’s operations in Shah Alam to move to Serendah within the next few years.
861 acres of land in Serendah
Company Acreage
UMW Aerospace 24.0 acres
Multi-Code Electronics Industries (M) Bhd
8.25 acres
Private local company 5.3 acres
T7 Kilgour Sdn Bhd 2.0 acres
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UMW HOLDINGS BERHAD
30th May 2019
THANK YOU
Corporate Portal www.umw.com.my
This material is proprietary and is prepared specifically for the recipient’s reference. The information contained herein is not to be distributed without the consent of UMW Holdings Berhad. Any recommendation or views contained in this document do not have regard to specific investment objectives, financial situation and the particular needs of any specific audience. The content furthermore is believed to be correct at the time of the issue of this document, and is not and should not be construed as an offer or a solicitation of any offer to buy or sell any securities. Nor does this document purport to contain all the information a prospective investor may require.
Nik Azlan Bin Nik Abdul AzizGroup Chief Financial OfficerUMW Corporation Sdn. Bhd.
S. VikneshwaranGeneral Manager Group Investor & Media RelationsEmail: [email protected]: +603 20252104
