Copyright © First Pacific Company Limited 6 June 2016. All rights reserved.
This presentation is provided for information purposes only. It does not constitute an
offer or invitation to purchase or subscribe for any securities of First Pacific or any of
its subsidiaries or investee companies, and no part of this presentation shall form the
basis of or be relied upon in connection with any contract or commitment.
Certain statements contained in this presentation may be statements of future
expectations and other forward-looking statements that are based on third party
sources and involve known and unknown risks and uncertainties. Forward-looking
statements contained in this presentation regarding past trends or activities should
not be taken as a representation that such trends or activities will continue in the
future.
There is no obligation to update or revise any forward-looking statements, whether as
a result of new information, future events or otherwise. You should not place undue
reliance on forward-looking statements, which speak only as of the date of this
presentation.
The dollar sign (“$”) is used throughout this presentation to represent U.S. dollars
except where otherwise indicated.
Telecommunications
Consumer Foods
Infrastructure
Natural Resources
First Pacific owns 25.6% of
PLDT which in turn owns
100% of Smart, its mobile
telecommunications
subsidiary.
First Pacific owns 50.1% of
Indofood and has an
economic interest of 40.3%
in ICBP. FPC owns 50.0% of
Goodman Fielder.
First Pacific owns 42.0% of
MPIC and holds economic
interests of 19.5% in
Meralco, 25.5% in Global
Business Power, 47.5% of
PacificLight, 22.2% of
Maynilad, and 41.9% of
MetroPacific Tollways.
First Pacific owns 31.2% of
Philex and Two Rivers, a
Philippine affiliate, holds
15.0%. First Pacific holds an
effective economic interest
of 41.6% in Philex
Petroleum, 31.4% in
IndoAgri, and 47.4% in
Roxas Holdings.
Sugar & coconut investments
$62 mln (0.8%)
Investment Objectives
 Unlock value, enhance cash flows to deliver
dividend returns, grow share price, and finance
further investment in value-enhancing
businesses
Investment Criteria
 Be located in or trading with fast-growing Asian
economies
 Be related to our four industry sectors
(telecommunications, consumer foods,
infrastructure and natural resources)
 Have a dominant market position in their
sectors
 Possess the potential for delivering substantial
cash flows to investors
 Allow FPC to establish management control or
significant influence
Telecommunications 30%
Consumer Foods
37%
Infrastructure
27%
Natural Resources
6%
PLP
$335 mln
(4%)
MPIC
$1.71 bln
23% of GAV
Goodman Fielder
$554 mln
7% of GAV
PLDT
$2.24 bln
30% of GAV
Indofood
$2.23 bln
30% of GAV
Data as at 31 May 2016; rounding may affect totals. Head Office cash not included.
China Minzhong
$456 mln
Plantations
$1.88 bln
PLDT
MPIC
$8.78 bln
$4.06 bln
Diversified Portfolio, Strong Returns
 Balanced weighting of the more mature
assets as well as newer ones
 Balanced weighting of different sectors
Meralco
Indofood
$7.31 bln
$4.46 bln
ICBP
 11 years of strong growth: GAV
compound annual growth rate of 16%
from end-2003 to end-May 2016
 CAGR of 29% in dividend income to
First Pacific from 2003 to 2015
$6.92 bln
Note: Area of pie chart and pie
chart segments represents market
capitalization (or investment cost
for unlisted assets) as at 31 May
2016. Rounding may affect totals.
Telecommunications 24%
Consumer Foods
35%
Infrastructure
32%
Natural Resources
9%
Serious of Transactions Amounting to $2.2 Billion
 Over the course of four days from May 27 to May 30, First Pacific
Group companies engaged in a series of transactions valued at $2.2
billion
 The transactions are aimed at repositioning PLDT, strengthening MPIC
for growth and reducing net debt at First Pacific Head Office
 First Pacific gains $171 million in cash for debt reduction while
retaining control of its fastest-growing asset, MPIC, with 55% of overall
shareholder vote
 First Pacific’s net debt falls to $1.55 billion from $1.7 billion, heralding
prospect of debt reduction on maturation of $300 million bond in July
2017
Repositioning PLDT for Return to Growth
 PLDT and Globe Telecom buy San Miguel’s telecommunications
companies on a 50:50 basis
 Enterprise value of the assets is $1.5 billion, equity value of $1.1 billion
 PLDT’s purchase consideration for its 50% share is $562 million
 For PLDT the threat of a third competitor entering the mobile
telephony market is much reduced
 PLDT gains valuable frequency spectrum including in the crucial 700MHz band
 PLDT to benefit from medium-term opex and capex savings
 Overall network improvement to result from addition of new
frequencies to drive the next phase of PLDT’s growth and make the
network future-ready
Strengthening MPIC’s Leadership
 Ty business group and family form
alliance with First Pacific as its GT
Capital holding company taking 15.6%
equity stake in MPIC in mix of new
and old shares worth $643 million
 Beacon Electric, the holding vehicle
for a 35% stake in Meralco, acquires
56% of Global Business Power, the
biggest electricity generator in the
Visayas Islands region of the
Philippines, from GT Capital in $474
million deal
 MPIC buys 25% of Beacon Electric
from PLDT in transaction worth $563
million, increasing its ownership of
Beacon Electric to 75% from 50%
 MPIC increases its effective
ownership of Meralco to 41%,
unlocking further strong cash flows
from the country’s biggest electricity
distributor
 MPIC wins control of the biggest
electricity generator in the Visayas
Islands region of the Philippines and
positioned itself as a major new
participant in this fast-growing market
Transaction A: GT Capital to invest in MPIC
 Forms a long-term strategic partnership with GT Capital/George Ty, including the signing of a shareholders’ agreement.
GT Capital is a major Philippines conglomerate with significant business interests in banking (Metrobank), property
development (Federal Land), power generation (GBP), automotive (Toyota) and insurance (AXA) industries. GT Capital’s
total gross investment into MPIC will be ₱40.9 billion (US$880 million)
 Provides ₱22 billion (US$472 million) new capital to strengthen MPIC’s capital base for growth initiatives, while
maintaining FPC’s voting control of MPIC
 Provides US$171 million to FPC head office for debt reduction
Transaction B: Beacon to acquire a 56% stake in GBP
 Diversification of MPIC’s infrastructure portfolio with an expansion into power generation in Visayas, Central Philippines.
Meralco will continue with its desired focus on its customer base in Luzon
 GBP has a 702 MW portfolio of operating generation assets in Visayas with additional development pipeline
 Represents an opportunity to acquire a strong operating, profitable and dividend generating asset
Transaction C: MPIC to acquire 25% stake in Beacon Electric from PLDT
 Realigns the group portfolio to further concentrate its infrastructure assets under MPIC, with more Meralco/Beacon
Electric shares held by MPIC rather than PLDT
 Delivers a profit uplift and cash engine for MPIC
Transaction D: PLDT to acquire SMC’s telecommunications assets
 Acquisition allows PLDT to gain access to valuable frequencies including key 700 MHz spectrum
 Capex and opex savings for PLDT
Head Office Bond Issues at a Glance
Head Office Balance Sheet
 No Head Office recourse for subsidiary or
affiliate borrowing
 Cash interest cover at 2.6x
 Gearing at 0.79x
Head Office Asset Cover
 Gross assets $6.9 billion at end-2015
 Gross debt $1.8 billion, gross debt cover
3.8x
 Net debt $1.7 billion, net debt cover 4.1x
 Average maturity of 4.2 years
 Blended interest cost of 5.3%
Issuer
FPMH Finance
FPT Finance
FPC Finance
FPC Treasury
Principal
Coupon
YTM*
Term
Maturity
US$300 mln
US$400 mln
US$400 mln
US$384 mln
7⅜%
6⅜%
6.0%
4½%
2.3%
3.8%
3.5%
4.4%
7-Year
10-Year
7-Year
10-Year
July 2017
Sept 2020
June 2019
April 2023
Head Office Debt Maturity Profile (USD mln)
500
400
300
300
320
2017
2018
400
400
2019
2020
384
200
100
Head Office Borrowings
 Borrowings dominated by bonds: 82%
bonds, 18% bank loans
 Fixed borrowing costs for 82% of
borrowings offer a secure safeguard
against rising interest rate trend
 Unsecured debt amounts to 61% of the
total
 Bloomberg ticker FIRPAC <Corp> <Go>
0
0
2016
Unsecured Bank Loans
Secured Bonds
2021
2022
2023
Unsecured Bonds
Head Office Gearing & Cash Interest Cover
Head Office Gearing
Cash Interest Cover
GAV/Net Debt
Net Debt (USD mln)
2009
0.36x
9.6x
8.9x
651.7
2010 2011 2012 2013 2014 2015
0.46x 0.71x 0.67x 0.51x 0.56x 0.79x
15.5x
4.5x 4.0x 3.4x 3.1x 2.6x
8.7x
6.6x 7.2x 6.7x 6.8x 4.1x
816.9 1,170 1,134 1,160 1,228 1,675
*Recent yield to maturity data from Bloomberg.
First Pacific Company Limited
(Incorporated with limited liability under the laws of Bermuda)
24th Floor, Two Exchange Square
8 Connaught Place, Central
Hong Kong
Tel: +852 2842 4374
info@firstpacific.com
www.firstpacific.com