Fraser & Neave Holdings Bhd

Analysts’ Briefing 8 May 2013

(RM mil) 1H2013 1H2012 Change vs. LY

Revenue 1,756 1,474 +19.1%

PBIT 135 110 +22.1%

PBT 132 111 +18.6%

PAT 112 149 -24.9%

Financial highlights

• Group revenue and operating profit gained 19% & 22% respectively :

• Recovery of Dairies Thailand to pre-flood levels

• Strong CNY volume from Soft drinks

• Intense price competition & distribution restructuring affected Dairies

Malaysia sales

• Profit after tax declined 25% - LY’s tax include deferred tax asset on halal hub

Key ratios 1H 2013 1H 2012 Change

EPS sen 30.8 41.3 -25.4%

NAV RM 4.30 4.09 +5.1%

Net DPS - interim sen 20.0 20.0 -

Share price @ 31 Mar RM 18.50 18.88 -2.0%

ROE % 7.2 10.1 -28.7%

Financial highlights

• EPS at 30.8 sen

• Ordinary dividend maintained at last year‘s level of 20 sen per share

1,474

1,756

44 -39

277 -0.1

1300

1350

1400

1450

1500

1550

1600

1650

1700

1750

1800

HY2012 Soft drinks Dairies M Dairies T Properties /Others

HY2013

Revenue

+19%

• Key drivers of the 19% revenue growth are :

• Recovery of Dairies Thailand to pre-flood levels

• Soft Drinks registered strong CNY sales

• Dairies Malaysia’s revenue contracted 7% due to competitive pricing pressure and distribution restructuring exercise

• Absence of property revenue – yet to launch S13 project RM mil

110135

513

63 -56

0

50

100

150

200

250

HY2012 Soft drinks Dairies M Dairies T Properties /Others

HY2013

PBIT

+22%

• Group PBIT gained 22%, mainly driven by :

• Strong post flood recovery in Thailand

• Favourable commodity prices & soft drinks sales mix

• RM 56mil drop in property contribution – last year recognition of gain from divestment of PJ land

RM mil

718.7

762.4

690700710720730740750760770

1H2012 1H2013

Soft drinks

• Volume increased 6%, driven by domestic sales. Seasons, Ice Mountain & Red Bull continue to register double digit gains

• Effective CNY activation boosted 100Plus & F&N fun flavour Q2 volume by 12% & 14% respectively

• Revenue gained 6%, in line with volume growth

• Profit improved 7% on better volume & lower input costs

• MyCola - launched in East Malaysia in Nov 12 showing good growth momentum. Plans in place to launch in Pen Malaysia soon

+6%

27.7

29.61.5

1.4

26

27

28

29

30

31

32

1H2012 1H2013

+6%

66.871.4

66

66.2

66.4

66.6

66.8

67

1H2012 1H2013

+6.9%

Volume

Revenue

PBIT RM mil

RM mil

Phy case (mil)

Domestic

Export

Export

Domestic

29.2

31.0

Dairies Malaysia

• Volume declined 2% while revenue contracted 7%, mainly from lower domestic sales

• Domestic sales impacted by :

• Price competition in on-premise channel

• Distribution restructuring

• Challenges in Modern Trade channels

• PBIT growth came from favourable commodity prices. LY’s profit impacted by RM 11mil accelerated depreciation of PJ building

• F&N Hi-Cal launched in Nov 12 registered positive growth as it is well received by consumers

4.4 3.9

0.7 1.1

0

1

2

3

4

5

6

1H2012 1H2013

523.9

484.9

460

470

480

490

500

510

520

530

1H2012 1H2013

12.1

24.8

0

5

10

15

20

25

30

1H2012 1H2013

-2%

-7%

+104%

Volume

Revenue

PBIT

RM mil

RM mil

Eq ctn (mil)

5.1 5.0 Export

Domestic Domestic

Export

Dairies Thailand

• Dairies Thailand volume & revenue jumped 109% and 120% respectively ~ full recovery to pre-flood levels

• With capacity restored, domestic, Indochina and export markets registered strong volume gains

• BHT 1.1 bil admitted by insurers & recognised. Todate, BHT 1.062 bil payment received from insurers

52.9

110.5

0

20

40

60

80

100

120

1H2012 1H2013

+109%

230.7

508.2

0

100

200

300

400

500

600

1H2012 1H2013

+120%

-23

39.7

-30

-20

-10

0

10

20

30

40

50

1H2012 1H2013

Volume

Revenue

+>100% PBIT

RM mil

RM mil

MT (000)

Properties / others

• Properties continue to focus on planning activities for PJ Section 13 project

• Section 13 project launch delayed to next financial year due to dissolution of local government in preparation for GE13

• Marketing activities for Phase 1 to start in Q2/Q3 2014

• LY’s PBIT included RM55 mil capital gain on disposal of PJ Section 13 land

0.4 0.3

0.0

0.1

0.2

0.3

0.4

0.5

1H2012 1H2013

54.3

-1.4

-10.0

0.0

10.0

20.0

30.0

40.0

50.0

60.0

1H2012 1H2013

-25%

->100%

Revenue

PBIT

RM mil

RM mil

Business outlook & prospects

Soft drinks

• Maintain 100Plus leadership

• Seasons brand re-alignment

• Continue MyCola momentum

• Protect F&N fun flavours

Dairies Malaysia

• Defending SCM share

• Grow EM category,

• Stimulate take home consumption

Dairies Thailand

• Strengthening SBC

• Defend EM

• Grow UHT & STM

• Accelerate Indochina penetration

• BNM forecast 4.5%- 5.5% economic growth in 2013

• RM strengthening against USD

• Inflation remain low, consumer spending expected to remain robust

• Commodity prices trending up

• Interim net dividend of 20 sen per share

• Sustainable dividend without special dividend

• Payment date 1 Aug 2013

Interim dividend per share (sen) nett

Dividends

12.8 16.5

20 20 20

15

0

5

10

15

20

25

30

35

40

1H09 1H10 1H11 1H12 1H13

Special Ordinary

35

Q&A