CCCC- The Industry Leader With Attractive Valuation JP Morgan Investors Forum, Beijing June, 2013
Agenda Company Overview Financial Highlights and Stock Performance Focus of Business Strategy Industry Opportunity and Company Outlook 1
Company History and Share Capital Structure Group commenced operation in China July, 2005 CHEC Group and CRBC Group merged to form China Communications Construction Group Oct, 2006 Established China Communications Construction Dec, 2006 Listed in HK Stock Exchange with an issuance of 4,427.5mn H shares Stock Code: 01800 March, 2012 Listed in Shanghai Stock Exchange with an issuance of 1,349.7mn A shares Stock Code: 601800 China Harbor Engineering Corporation China Road & Bridge Corporation 1950s 2013 Class of Shares Share Capital Number of Shares (mn) Percentage Domestic Shares 10,324.9 63.83% A Shares 1,422.3 8.80% H Shares 4,427.5 27.37% Total 16,174.7 100.00% SASAC 100% CCCG (Holdings) 63.8% CCCC Shareholders of H and A shares 36.2% 2
Business Structure Core Business Industry Leading Position 1 The largest port design and construction company in China Infrastructure Construction Infrastructure Design Dredging Heavy Machinery Manufacturing 1 A Leading Road & Bridge Design and construction company in China 1 The largest Dredging Company in the world Port Construction Road & Bridge Construction Port Design Road & Bridge Design Capital Dredging Maintenance Dredging Container Cranes Bulk cargo handling equipments 1 The largest port machinery manufacturer, a leading offshore auxiliary ships manufacturer and top-tier offshore equipment design company in the world Railway and rail transportation Railway and rail transit Design Reclamation Environmental Offshore construction equipments 1 The largest international engineering contractor in China Construction Protection Large steel structures BT/BOT Project Dredging Road Construction Overseas Project Machinery 3
Agenda Company Overview Financial Highlights and Stock Performance Focus of Business Strategy Industry Opportunity and Company Outlook 4
Business Performance New Contract 283,040 360,363 411,738 457,848 514,920 CAGR=16.1% RMB mn 2008 2009 2010 2011 2012 Backlog 512,103 601,912 700,525 334,330 426,027 CAGR=20.3% RMB mn 2008 2009 2010 2011 2012 5
Financial Highlights Revenue Net Profit&Net Margin CAGR=13.4% CAGR=19.2% RMB mn 178,889 226,920 272,734 294,281 295,321 RMB mn 6,075 7,200 9,599 11,761 12,248 4.1% 4.0% 3.4% 3.2% 3.5% 2008 2009 2010 2011 2012 2008 2009 2010 2011 2012 Total Asset RMB mn 264,058 218,098 310,633 CAGR=18.8% 358,985 433,815 Net Asset RMB mn 54,614 41,171 CAGR=20.5% 62,990 70,231 86,749 2008 2009 2010 2011 2012 2008 2009 2010 2011 2012 6
Stock Performance Since Listing CCCC s H-share price outperformed HSI and HSCEI for much of the time since listing, which has demonstrated market confidence in the company. It reached its historical high price at HKD24.6 in Nov 2007. Resulted from gloomy market expectations influenced by economic downturn and tightening policy by the Chinese government, CCCC s share price had been sluggish for the year around 2010, but for the year 2012 it started to pick up and outperform again. 350% 14000 300% 成交金额 Volume CCCC HSI HSCEI 12000 250% 200% 10000 150% 8000 100% 6000 50% 0% 4000-50% 2000-100% 06-12 07-06 07-12 08-06 08-12 09-06 09-12 10-06 10-12 11-06 11-12 12-06 12-12 0 7
Agenda Company Overview Financial Highlights and Stock Performance Focus of Business Strategy Industry Opportunity and Company Outlook 8
Current Structure and Mix Improvement Dredging 10.5% Infrastructure Design 5.4% Revenue (2012) Heavy Machinery Manufacturing 6.4% Others 2.1% We devote to improve our business structure through increasing projects of higher profit margin and exploring new business area to seek new growth as well as to maximize our profitability. Focus on Overseas Business and Investment Projects Segment Result (2012) Infrastructure Construction 75.5% CCCC Core Business Dredging 18.1% Heavy Machinery Manufacturing Others -0.6% 0.7% Infrastructure Construction Infrastructure Design Dredging Heavy Machinery Manufacturing Overseas Business Investment Business Infrastructure Design 12.1% Infrastructure Construction 69.7% 9
Overseas Expansion Strategy We have been operating overseas for over 30 years, and will continue to aggressively explore oversea markets. Revenue generated from overseas business will account for 30% of the company s overall revenue in 2015 compared with roughly 20% in 2012. Steady growth of overseas business Rich experiences and outstanding capacity RMB million 80,828 75,417 New order Revenue 60,800 62,720 62,323 38,950 32,151 21,958 27,151 14,700 2008 2009 2010 2011 2012 New contract value in 2012 was 4.6x over that in 2006 when CCCC was listed in HKEX. Revenue keeps steady growth over recent years, and revenue from overseas as a percentage of the total also constantly increases. Overseas Projects Global Network & New area Excellent Risk management Holding a great variety of global construction licenses, we are able to conduct port, road and bridge, and railway etc. construction projects, and is exploring investment projects overseas. We have established global presence in over 120 countries and regions, e.g. Africa, South East Asia and Middle East. Latin America is one area of new focus. Strict risk management system has been adopted in advance. Rich experiences against political and economic risk, especially the forex risk. 10
Further Development of Investment Business The idea of developing investment business (mainly BT/BOT project) is to transform CCCC from a contractor to a contractor + operator with assets that are able to generate stable returns in the long-term. At the end of 2012 Number of investment projects: 103 Total investment (contract value): RMB274.5bn Revenue from investment projects as a Setting as the focus of business percentage of total: 10.3% transition as the company strategic plan Target value of overall BOT asset by end of 2015: RMB100bn Projects mainly include: Expressway, land development, real estate, integrated urban development, etc. Strict risk control: Five Don ts not undertaking projects which: fall outside of our core business, require unsecured loans, have no guarantees, deliver below standard rates of return, and exceed our capability Xianning to Tongshan Expressway in Hubei Province, BOT+EPC Project Guiyang to Duyun Expressway in Guizhou Province, BOT+EPC Project Chongqing Chaotianmen Yangtze River Bridge, BT Project Guangming Expressway, Guangzhou, BOT Project 11
Unique Business Model Diversified products create a balanced business and help minimise risks. Comprehensive solutions are available to customers as a result of integrated business chain. Ports, navigation channels, roads, bridges, tunnels, railways, urban rails, airport Combinative business of land and water One-stop solutions Planning Design and Build Investment Operation HongKong-Macao- Zhuhai Bridge under construction : Master plan, reclamation of artificial islands, steel structure manufacturing, construction of islands and tunnels by CCCC Zhuhai Hengqin Island under construction: Integrated development of the new city area, including infrastruture construction and reclamation of artificial islands by CCCC 12
Agenda Company Overview Financial Highlights and Stock Performance Focus of Business Strategy Industry Opportunity and Company Outlook 13
Industry Opportunity The 12 th Five-Year Plan for Comprehensive Development of Transportation (MOT, July 2012) 11 th Five-Year Plan 12 th Five-Year Plan %change Total Transportation Network (thousand km) 4,320 4,900 13.4% Railway mileage (thousand km) 91 120 31.9% Expressway mileage (thousand km) 58 83 43.1% Urban rail mileage (km) 1,400 3,000 114.3% Number of deep-water berths 1,774 2,214 24.8% Number of airport for civil use 175 230 31.4% MOT General Policy on Transportation Infrastructure Development: Moderately In Advance Market Opportunity for CCCC -Out of the MOT plan, there are increasing demand of urban development as a result of urbanization -Investment as a major impetus for Chinese economic growth - More credit flowing into real economy 14
Outlook Leading global contractor that provides one-stop services in infrastructure construction Overall Target Becoming a top-tier conglomerate worldwide Maximizing shareholder s interests Global investor in infrastructure Developer and Operator in comprehensive civil engineering and development Global top-tier company with standardized corporate governance structure, scientific management, flexible operational system, state-of-the-art expertise, high employee satisfactions and strong social recognition. 15
Thank You Investor Relations Team YU Jingjing, TAN Lu, ZHAO Yang, LI Yilin Tel: +86-10-8201 6562 Fax: +86-10-8201 6524 Email: ir@ccccltd.cn 16