Analysts Briefing 1H14

Transcription

1 Analysts Briefing 1H14

2 Outline Who we are 1H14 results Guidance 2

3 Who we are 3

4 Largest mass housing developer in the Philippines Baguio Angeles Bulacan Metro Manila Cavite Iloilo Cebu Davao 4

5 By the numbers 28,000 units sold and delivered since years experience in mass housing 22bn in housing loan takeouts 30 projects completed 5

6 Founders Mariano D. Martinez, Jr. Chairman Januario Jesus G. B. Atencio III President and CEO Luis N. Yu, Jr. Chairman Emeritus & Founder 6

7 Successful follow-on offer Conducted a successful follow-on offering last May at P6.50 raised P5.6 billion in new capital 7

8 Cornerstone investors TPG CAPITAL USA KHAZANA NASIONAL MALAYSIA $50 Billion Private Equity Fund $30 Billion Sovereign Wealth Fund 8

9 Our mission To create a more inclusive Philippine society by using mass housing as the vehicle to provide greater value for our buyers, sellers, employees, suppliers and shareholders, and in the process, transform people s lives for the better 9

10 Deca Homes Brands Typical floor area: 35 sqm to 60 sqm Typical lot area: 35 sqm to 120 sqm Located at the outskirts of major metropolitan areas Unit price range: Php 450k to Php1.25m Horizontal Residential Subdivisions 10

11 Urban Deca Homes Brands Typical floor area: 25 sqm Location: Central areas of highly urban locations 4 to 5-storey low-rise walk-up or 8 to 12-storey with lifts Unit price range: Php 800k to Php 1.25m Medium-Rise Residential Buildings 11

12 Urban Deca Towers Brands Typical floor area: Approx. 13 sqm Location: Highest density urban areas of Metro Manila Makati: 30-storey, 1,600 units, EDSA: 40-storey, 1,000 units Target unit price range: Php 875k (~US$20k) 1 Micro Living Units 12

13 High Value Amenities 13

14 Current landbank 335 hectares 89,850 units in potential sales equivalent to 87bn in gross sales. Location Hectares Iloilo* 150 Davao* 75 Rizal 31 Metro Manila* 41 Cebu 17 Bulacan* 13 Cavite 8 Total 335 *with new acquisitions 14

15 Recent landbank acquisitions Location Type Area (Has.) Target Units Vitas, Tondo, Manila Vertical 8 12,000 Vitarich, Marilao Bulacan Horizontal 13 6,240 Davao City Horizontal 29 1,905 Pavia, Iloilo Horizontal 30 1,920 Mahogany, Imus, Cavite Vertical Hampton, Imus, Cavite Vertical 4 2,730 Total 85 25, = 335 has. of landbank 15

16 Project launches FY14 Project Type Target/Actual Launch Date Location Landbank (ha.) Units DH Marseilles Horizontal April Cavite Urban DH Tisa MRB July Cebu 8.5 2,800 Urban Tower Shaw High Rise August NCR 0.1 1,000 DH Pavia 3 Horizontal August Iloilo 40 2,724 DH Guadalupe Horizontal October Cebu DHRR Prime Horizontal December Davao DHRR Com. Phase 11 Horizontal December Davao Total ,669 16

17 Project Type Target Launch Date Project launches FY15 Location Landbank (ha.) Units DH Tanza Horizontal January Cavite DH Catalunan Grande Horizontal January Davao DH Lorenzo Horizontal January Davao 25 3,125 Urban DH Muntinlupa MRB April NCR 1.8 3,240 Urban DH Quirino MRB June Davao DH San Mateo Horizontal October Rizal ,600 DH Baywalk Talisay 3 Horizontal December Cebu Urban Tower Yakal High Rise December NCR 0.1 1,600 Total ,010 17

18 Our core principle A truly effective mass housing program must be grounded on understanding how a typical Filipino middle-class family lives, and how they earn and spend their money today 18

19 Mass housing backlog Year Socialized Economic Low Cost Mid High End 2001 (49,860) (92,317) (7,727) 19,082 15, (47,675) (85,977) (7,148) 20,469 16, (42,941) (85,755) (5,035) 23,916 19, (40,401) (43,403) (7,715) 20,983 17, (37,042) (73,828) (3,067) 27,836 22, (47,394) (122,436) (7,225) 32,545 26, (81,312) (331,425) (96,772) 18,790 20, (156,797) (620,893) (201,667) 13,162 21, (119,077) (413,970) (124,053) 14,562 18, ,104 64,237 21,508 29,866 22, (90,886) (156,310) (23,259) 29,192 24,376 Total (663,281) (1,962,077) (462,160) 250, ,011 Aggregate mass housing backlog of 3.1m units Open market surplus of 0.47m units 19

20 Our market Young, college educated Stable jobs, other income 25,000 monthly income Renters, not asset owners Little or no savings Deeply Aspirational Seek Value for Money Optimistic of their future 20

21 Our growth strategy Expand New Projects in Existing Branches Explore Securitization and other Housing Finance Modes Expand New Projects in New Branches Strong platform for future growth Continuous Improvement in Management of Key Areas Increase Landbank by another 250 Hectares 21

22 Our business model Fast Pre- Cast Construction Business Model Affordable amortization Proactive Credit and Collection Platform 22

23 Our business model Fast Pre- Cast Construction 8990 s in-house Pre Cast technology constructs housing units in an average of 8-10 days Tremendous economies of scale that results in lower materials cost, higher quality of panels and greater site efficiency 23

24 Our business model Accessible In-House Financing 2% down payment 8.5% interest rates, 25-years term Migrates to HDMF within 4 years 12B CTS Receivables Portfolio of which 4B has been delivered to HDMF, 2B has been cleared, 1B has been taken-out 24

25 Time lapse Construction 25

26 Receivables to cash In M Converted to Cash Receivables Receivables by end ,011 Less: Sale to CTBC 1,000 HDMF Take-outs 4,000 Securitization 800 Full Payments 165 Projected 2013 receivables converted to cash in ,965 5,965 Net receivables 4,046 26

27 Funding capacity In M Projected Amounts Receivables converted to cash 5,965 Credit lines 5,000 10,965 Less: Capital expenditures + Land Purchase 5,140 Net interest 372 Operating expenses 1,400 Total Expenditures 6,912 Net Cash Estimate 4,053 27

28 Business model Proactive Credit and Collection Platform Comprehensive platform of organization, software, systems, policies and procedures. Collection efficiency remains one of the HIGHEST in the industry 28

29 Collection efficiency 94.6% 92.6% 93.2% 93.8% 96.8% Average of 94% in the past 5 years

30 Growth trajectory 7,900 5, ,283 2,267 3,040 2,560 2,241 4, Target Income grew from P189.0m in 2004 to 5.7bn in , total revenues are expected to reach 8.0 bn. We have grown by 30 times by the end of Establishing a Solid Track Record 30

31 1H14 results

32 Financial highlights Sales in Number of Units Unit Sales Breakdown in ,738 MRB 11% 4,187 3,537 3,812 2,421 Low Cost Housing 89% H13 1H14 32

33 Financial highlights Total Revenue Revenue Breakdown 1.3% 1% PHP billion % 2% % 11% % 85% H13 1H14 1H13 1H14 Subdivision MRB Timeshare Azalea 33

34 Financial highlights Gross Profit Net Income Before Tax PHP billion PHP billion H13 1H st Sem 1st Sem

35 Gross and Net Income Margins Financial highlights 60% 63% 64% 61% 39% 44% 40% 44% H14 GROSS NET 35

36 Financial highlights Equity Total Asset PHP billion PHP billion st Sem 1st Sem st Sem 1st Sem

37 Financial highlights Debt to Equity Return On Equity % 34.62% 33.11% 27.69% % H13 1H H13 1H14 37

38 Strong balance sheet Interest Coverage Ratio Current Ratio 12.68x 1.48x 1.43x 10.88x 10.90x 1.09x 1.11x 7.83x 0.60x 0.3x st Sem 1st Sem st Sem st Sem

39 Strong balance sheet Total Outstanding Debt Average Funding Cost PHP billion H13 1H

40 Strong 1H14 Performance Financial Highlights (Php M) 1H13 1H14 Growth Rate Total Revenue 3,137 4,096 31% Gross Income 1,950 2,513 29% Income Before Tax 1,553 1,956 26% Net Income After Tax 1,512 1,808 20% Gross Income Margin 62% 61% EBIT Margin 50% 48% 40

41 Major Operating Expenses (Php M) 1H13 1H14 Growth Rate Marketing and Selling % Documentation % Taxes and Licenses % Salaries and Employee Benefits % Management and Professional Fees % Security, Messengerial and Janitorial % Transportation and travel % Rent % Communication, Light and water % 41

42 Strong 1H14 Performance Financial Highlights (Php M) 1H13 1H14 Growth Rate Total Assets 12,004 22,942 91% Total Liabilities 6,544 9,261 42% Total Equity 5,460 13, % Total Retained Earnings 1,603 3, % Interest Coverage Ratio Current Ratio Return on Equity

43 Balance sheet In M 1H13 1H14 Growth Rate Total Assets 12,004 22,942 91% Current Assets 3,464 4,946 43% Trade Receivables 10,036 12,294 23% Total Liabilities 6,544 9,261 42% Current Liabilities 3,118 3,465 11% Loan Payable 4,905 6,798 39% Stockholder s Equity 6,596 13, % 43

44 Updates 1H14 In M 1Q14 2Q14 1H14 1H13 Growth Rate Total Revenue 1,915 2,181 4,096 3,137 31% Gross Profit 1,189 1,324 2,513 1,950 29% Gross Margin (%) Net Income ,808 1,512 20% Net Margin (%)

45 Updates 1H14 1Q14 2Q14 Units Rev/Unit Units Rev/Unit Deca Homes 1, ,429 1,610 1,161,491 Urban Deca Homes 196 1,059, ,095,786 Total 1,972 1,840 45

46 Guidance

47 Guidance 2014 Revenue: 7.6bn - 8.0bn Net Income: 3.6bn - 4.0bn 2014 vs 2013 income growth: 60% - 80% 47

48 Provides recurring income base; comparable to rental yield for 25 years About P800 million interest income for 2014, at 8% to 11.5% interest rate Managing Receivables 96% collection efficiency > 85% occupancy rate for mall space 48

49 Managing Receivables CTS pool provides commercial banks access to mass markets $HOUSE is preferred intermediary to grow client base of commercial banks Pag-ibig is mandated to loan P50.0bn 49

50 Manageable Receivables (Pm) 2014 Target Sales 8,300 Cost of Sales + OPEX 4,150 Funding / Week 80 Cash from Receivables 30 Take - outs 50 Cost of sales at 40% vs. 60% for others; efficiency P80m cash needed to fund sales cost+opex P30m from existing receivables P50m take-outs from Pag-ibig or comm l banks = 55 units or 11 accounts per week per branch. 50