Malaysia Airports Holdings Berhad ANALYST BRIEFING FINANCIAL RESULTS FOR THE QUARTER ENDED 31 ST MARCH 2012 Faizal Mansor Chief Financial Officer, MAHB 26 April 2012 1
2 Table of Contents 1Q12 Review Group Financial Review Commercial Revenue Analysis Traffic Statistics Peer Comparison
1Q12 REVIEW GROUP FINANCIAL REVIEW COMMERCIAL REVENUE ANALYSIS TRAFFIC STATISTIC PEER COMPARISON
Significant Events Resilient share price performance Share Price (RM) * All share price are month-end closing price, except Apr-12 closing price is as at 25/04/12 4
2012 Headline KPI On track to achieve 2011 Headline KPI * * Without construction profit 5
1Q12 Review 1 Global Aviation Industry Remarkable passenger traffic growth in Feb 2012, + 7% yoy with on-going evidence of a sustained rise in global demand for air travel over time Buoyant traffic growth in the emerging markets - Middle East (10.9%), Latin America / Caribbean (10.2%) and Asia Pacific (7.7%) Asian airports are strong contributors to global growth - Jakarta, Bangkok and Beijing airports are among the fastest growing high volume airports globally The residual effects of political unrest on air traffic have now subsided in Northern Africa, African region grew 25% yoy in Feb 2012 While the threat of a European financial meltdown seems more remote compared to a few months ago, fuel price level remain a challenging risks for the aviation industry 1 MAHB 1Q12 pax growth 6.5% (International +6.5%, Domestic +6.4%) in tandem with positive growth trend in Asia Pacific region Travel demand remain strong foreign airlines have been strongly filling up the gaps / replacing route cuts announced by Malaysian carriers Both MTB & LCCT registered strong pax growth, with higher sales / retail spending Source: ACI Strong Gains in Passenger Traffic (5/4/2012) and IATA: Strong February Performance But Outlook Remains Fragile (3/4/2012) 6
YTD Pax Movement KLIA amongst the best performing airports in the region ( million pax) +6.9% +18.4% +15.6% +14.1% +12.8% +12.3% +10.4% +10.0% +9.0% +6.5% +4.7% +4.4% * * * * * * Delhi, Bangkok, Manila, Hyderabad and Beijing are based on February figure 7
1Q12 REVIEW GROUP FINANCIAL REVIEW COMMERCIAL REVENUE ANALYSIS TRAFFIC STATISTIC PEER COMPARISON
9 IC 12: Service Concession Arrangements MAHB Group Construction Profit IC 12 addresses the accounting for public-private arrangements whereby a private sector operator involves in the construction/upgrading of infrastructure assets to be used in providing public service. Under IC 12, the operator may provide construction services to the grantor in exchange for an intangible asset, i.e. a right to collect revenue in accordance with the Operating Agreements. In accordance with FRS 138 Intangible Assets, the operator recognizes the intangible asset at its fair value. The fair value of the intangible asset is calculated by including certain mark-up on the actual cost incurred, estimated to reflect a margin consistent with other similar construction works. The Group has estimated the mark-up used in calculating the fair value of the consideration receivables at an average of 4.5% and 7.5% on the cost incurred for klia2 and expansion to Penang International Airport, respectively and such the contract revenue and contract costs associated with the construction contract is recognised as revenue and expense respectively by reference to the stage of completion of the contract activity at the balance sheet date. Construction profit recognised in the current quarter is as follows:
10 1Q12 Results Excluding IC 12 effects, 1Q12 revenue grew 12.2%:- 13.1% growth in airport operations, driven by 18.1% increase in aeronautical revenue due to higher pax growth and implementation of new rates - International PSC increased from RM51 to RM65 effective 15/11/11 - LCCT PSC increased from RM25 from RM32 effective 15/11/11 - Landing & Parking approximately 10% effective on 1/1/12 Increase in PSC revenue was negated by lower MARCS PSC as MAHB no longer entitle to claim for MARCS PSC (international PSC of RM65) upon implementation of new rates PBT (without IC 12) increases 10.0% mainly due to the positive growth in revenue and lower share of associate losses - Male registered higher profit ~RM2.5mil (1Q11: RM871k profit) - Lower losses from SGIA ~RM17.1mil (1Q11: RM19.5mil loss)
Group Segmental Revenue RM mil Airport Operations (RM mil) 1Q12 : RM624.8 (+6.8%) 1Q11 : RM585.2 Non Airport Operations (RM mil) 1Q12 : RM32.9 (+0.9%) 1Q11 : RM32.6 Airport Operations Non-Airport Operations Airport Operations segment grew 6.8% to RM624.8 mil due to higher passenger and aircraft numbers and implementation of new rates Excluding construction revenue of RM146.6mil, Airport Operations grew 13.1% to RM478.2mil Non-Airport Operations segment grew 0.9%:- 1) Hotel segment grew 33.7% due to higher revenue from room and F&B. The occupancy rate lower by 2.3% (1Q12: 69.2% vs 1Q11: 71.5%) while average room rate increased by 19.0% (2012: RM400 vs 2011: RM336) 2) Agriculture segment declined 33.8% due to lower average FFB price and production volume (1Q12: RM643/13,647MT vs. 1Q11: RM791/16,811MT) attributed by the effects of El Nino in recent years. 11
Revenue Analysis - Airport Operations RM mil Aeronautical 1Q12 : RM241.7mil (+18.1%) 1Q11 : RM204.6mil Non Aeronautical 1Q12 : RM236.6mil (+8.4%) 1Q11 : RM218.2mil Construction Revenue * High growth in PSC due to both strong international and domestic pax growth (6.5% international pax vs 6.4% domestic pax growth) Retail business growth outpaced overall pax growth * Others: Airport Transit Hotel, security passes, Free Commercial Zone revenue and network services 12
Group Cost Analysis RM mil Direct Costs 1Q12 : RM107.1mil (+9.5%) 1Q11 : RM97.8mil Operating Costs 1Q12 : RM221.0mil (+18.8%) 1Q11 : RM186.0mil Construction Cost * Total costs (Without IC 12) increased marginally by 15.6% mainly due to increase in staff cost, utilities and maintenance:- (1) Higher staff costs are mainly due to annual increments, additional recruitment and the impact of adjustments arising from the finalisation of Non-Executive 6 th Collective Agreement in Oct 2011 (2) Increased in utilities and communication was in line with increased in passenger movement * Others includes other administrative, insurance, quit rent & assessment, professional fees, lease rental, travelling and advertising & publicity 13
Group Segmental PBT RM mil Airport Operations (RM mil) 1Q12 : RM196.3(+1.4%) 1Q11 : RM193.5 Non Airport Operations (RM mil) 1Q12 : (RM42.6) (+19.0%) 1Q11 : (RM52.6) * Airport Operations Non-Airport Operations 1Q12 PBT (without IC12) increase 10.0% due to the positive growth in revenue and lower share of associate losses Note: The group segmental analysis above excludes inter-segment transactions. * Others includes share of results of associates 14
15 Balance Sheet Analysis Strong balance sheet RM mil Higher due to construction cost incurred for klia2 and Penang Airport
16 Revenue & Costs Analysis - Airport Operations Note: The analysis above excludes construction revenue/cost recognized under IC 12
1Q12 REVIEW GROUP FINANCIAL REVIEW COMMERCIAL REVENUE ANALYSIS TRAFFIC STATISTIC PEER COMPARISON
KLIA Total Sales Sales at KLIA YTD 2012 Sales at KLIA YTD 2012 Sales per pax:- Overall KLIA (inc. LCCT) at RM32.80 per pax KLIA (exc. LCCT) registered higher sales per pax growth of 12.8% at RM41.64, while LCCT grew 4.3% to RM23.78 per pax 18
ERAMAN Retail Revenue Retail Revenue YTD 2012 Retail Revenue YTD 2011 MAHB s own retail arm, Eraman s business grew due to higher retail and F&B income as a result of increase in passenger volume Retail revenue per pax in KLIA (inc. LCCT) grew 9.7% in 1Q12 to RM12.28 per pax (1Q11 RM11.19 per pax) LCCT retail revenue per pax at RM12.88, outpaced MTB by 10.3% 19
KLIA Retail and F&B Rental Analysis MGP at KLIA YTD 2012 MGP at KLIA YTD 2011 Royalty (Rent%) at KLIA YTD 2012 Royalty (Rent%) at KLIA YTD 2011 Increase in rental royalty due to higher sales at KLIA, contributed by higher air passenger and airport visitors number Note: Space is based on occupied space and excluding Eraman s space 20
1Q12 REVIEW GROUP FINANCIAL REVIEW COMMERCIAL REVENUE ANALYSIS TRAFFIC STATISTIC PEER COMPARISON
Pax Movement ( mil pax) Total passenger volume for 1Q12 was 16.0 million, which was 6.5% higher than 1Q11. International and domestic passenger movements grew by 6.5% and 6.4% respectively 22
Aircraft Movement ( 000) Travel demand remain resilient albeit frequency/destination cut by Malaysian carriers MTB recorded 2.6% pax growth although aircraft movements declined by 1.7% 23
24 Cargo Movement ( mil tonnes)
1Q12 REVIEW GROUP FINANCIAL REVIEW COMMERCIAL REVENUE ANALYSIS TRAFFIC STATISTIC PEER COMPARISON
Percentage (%) Share Price - Benchmark & Peers MAHB FBM KLCI Source: Bloomberg, Performance end date: 24/04/12 closing price 26
MALAYSIA AIRPORTS HOLDINGS BERHAD PEJABAT KORPORAT PERSIARAN KORPORAT KLIA 64000 KLIA SEPANG, SELANGOR TEL: 603-87777000 FAX: 603-87777778