BATU KAWAN BERHAD Investor Presentation 30-Jan-2013 Company Background Batu Kawan Berhad (“BKB”) is an investment holding company with subsidiaries and associates involved in chemical manufacturing, logistics, plantations, property investment and investment holding Incorporated in Malaysia in 1965 Commenced operations as a plantations company when it took over the assets and liabilities of its predecessor company, Batu Kawan Rubber and Coconuts Plantations Ltd in 1971 Listed on the Bursa Malaysia Main Market since 12 October 1971 Market capitalisation of RM7.6 billion(1) (1) Market data as at 29-Jan-2013 BATU KAWAN BERHAD 2 Company Overview BATU KAWAN BERHAD Plantations Kuala Lumpur Kepong Berhad (46.57% Associate) Chemicals • Produce and process palm products and natural rubber, oleochemical, property development PT Satu Sembilan Delapan (92%) • Plantation development in Kalimantan, Indonesia • 5,728ha landbank – 3,602ha planted Collingwood Plantations (18% Investment) See Sen Chemical Berhad (61%) • Sulphuric acid, oleum, aluminium sulphate, sodium silicate Menara KLK (100%) • 11-storey commercial building in Mutiara Damansara, Petaling Jaya • Chlor-alkali products, methyl chloride, ferric chloride • 251,325ha landbank – 212,300ha planted Malay-Sino Chemical Industries Sdn Bhd (86%) Others Other investments • Plantation development in Papua New Guinea • 44,342ha landbank for oil palm plantations Note: % denotes BKB’s shareholding percentage BATU KAWAN BERHAD 3 Kuala Lumpur Kepong Berhad Kuala Lumpur Kepong Berhad (“KLK”) is an 46.57% associate company of BKB Primary operations are in the production and processing of palm products and natural rubber on its plantations located in Peninsular Malaysia, Sabah and Indonesia Downstream operations include refineries & fractionation, oleochemicals Total landbank of 251,325ha 193,230ha planted with oil palm and 19,070ha planted with rubber Others: Property development, Synthomer plc (19.45%) Listed on the Bursa Malaysia Main Market since 1974 Market capitalisation of RM23.5 billion (1) (1) Market data as at 29-Jan-2012 BATU KAWAN BERHAD 4 KLK Financial Summary Profit Before Tax Revenue (RM million) (RM million) 12,000 10,743 10,570 2,400 2,066 2,000 9,000 7,855 6,658 7,491 1,600 1,445 1,200 6,000 1,560 1,383 887 800 3,000 400 0 0 FY08 FY09 FY10 FY11 FY08 FY12 Return on Equity 25 20 FY10 FY11 FY12 EPS and DPS (Net) (%) 160 22.2 18.8 FY09 17.0 16.9 120 15 10.9 (Sen) 148 114 98 95 80 55 10 0 65 60 58 40 40 5 85 0 FY08 FY09 BATU KAWAN BERHAD FY10 FY11 FY12 FY08 FY09 FY10 FY11 FY12 5 PT Satu Sembilan Delapan PT Satu Sembilan Delapan is BKB’s 92% owned Indonesian subsidiary involved in oil palm plantation development in East Kalimantan Total landbank of 5,728ha – 3,602ha planted FY2012 results Revenue: Operating results: Profit per average mature area: RM33.5 million RM14.9 million RM4,830 per ha Oil Palm Planted Area 4,000 (hectare) 3,000 2,000 20 1559 911 515 2537 1,000 0 FFB Yield 14.5 15 16.3 18.4 10 1,868 2,516 3,087 5 844 FY09 (mt/ha) 3.5 0 FY10 Mature BATU KAWAN BERHAD FY11 FY12 FY09 FY10 FY11 FY12 Immature 6 Collingwood Plantations In October 2011, BKB acquired 18% of Collingwood Plantations Pte Ltd (“CPPL”) along with KLK with a 51% stake Purchase price for BKB’s 18% stake was RM9.8 million A wholly-owned CPPL subsidiary owns leases to 44,342 ha of land in Papua New Guinea which will be developed into oil palm plantations A long term development leveraging on the overseas plantation development expertise and resources of KLK BATU KAWAN BERHAD 7 BKB Chemical Group Malay-Sino Chemical Industries (86%) (industrial chemical manufacturing) Malay-Sino Agro-Chemical Products (industrial chemical manufacturing) Circular Agency / North-South Transport (chemical logistics) See Sen Chemical Berhad (61%) (industrial chemical manufacturing) BASF See Sen (30% owned by SSCB*) (specialty chemical manufacturing) BKB’s Chemical Group recorded FY2012 revenues of RM294.9 million and operating profits of RM48.9 million * BKB’s effective shareholding is 18% BATU KAWAN BERHAD 8 Malay-Sino Chemical Industries MSCI is a subsidiary of BKB (86% shareholding) Incorporated in 1973 Largest producer of chlor-alkali chemical products in Malaysia Chlor-alkali products: chlorine, caustic soda (sodium hydroxide), hydrochloric acid, bleach (sodium hypochlorite) Other products: ferric chloride, ferric 200M, calcium chloride Annual capacity of 87,000 metric tonnes of 100% caustic soda MSCI operates 2 chemical manufacturing plants Location: Lahat (Perak) and Kemaman (Terengganu) Malay-Sino Agro-Chemical Products (100% owned subsidiary of MSCI) is one of the largest methyl chloride producer in South East Asia Location: Lahat (Perak) Vertically integrated with MSCI’s Lahat plant BATU KAWAN BERHAD 9 Logistics Circular Agency and North-South Transport (100% owned subsidiaries of MSCI) provides the BKB Chemical Group with its own in-house specialist chemical transporter Vertically integrated logistics Circular Agency provides bulk tanker transportation North-South Transport provides bulk lorry transportation BATU KAWAN BERHAD 10 See Sen Chemical Berhad SSCB is a subsidiary of BKB (61% shareholding) Incorporated in 1965 Largest producer of sulphuric acid in Malaysia Annual capacity of 245,000 metric tonnes sulphuric acid SSCB operates 2 chemical manufacturing plants Products: sulphuric acid, oleum, dilute sulphuric acid, solid and liquid aluminium sulphate, sodium silicate, liquid sulphur, sulphur powder Location: Pasir Gudang (Johor) and Kemaman (Terengganu) BASF See Sen (30% associate of SSCB) produces high purity sulphuric acid for the electronics industry Location: Kemaman (Terengganu) Vertically integrated with SSCB’s Kemaman plant Joint-venture partner is BASF (70%), the world’s leading chemical company BATU KAWAN BERHAD 11 Menara KLK Menara KLK is owned by Batu Kawan Holdings Sdn Bhd (100% owned subsidiary) Completed in March 2009, Menara KLK is a 11-storey commercial office building with a 4storey podium and a 2-level basement car park Located in Mutiara Damansara, Petaling Jaya next to Tesco, Ikea, The Curve, Ikano Power Centre and Cineleisure Damansara Occupancy rate(1) of 95%; KLK is the anchor tenant of the building FY2012 rental income of RM6.3 million and operating profit of RM3.3 million Tenants (1) As at 30-Sep-2012 BATU KAWAN BERHAD 12 BKB Financial Summary Operating Profit Share of Results of Associates (RM million) (RM million) 120 800 103 100 66 55 60 485 63 400 471 285 38 200 20 0 0 FY08 FY09 FY10 FY11 FY12 FY08 25 785 800 FY11 FY12 20 15 351 18.1 16.3 11.6 10 200 5 0 0 FY09 21.2 18.1 626 573 523 FY08 FY10 (%) (RM million) 1,000 400 FY09 Return on Shareholders’ Equity Profit Before Tax 600 564 600 80 40 732 FY10 BATU KAWAN BERHAD FY11 FY12 FY08 FY09 FY10 FY11 FY12 13 Dividends and Shareholders’ Equity Earnings per Share and Dividends per Share (Net) (Sen) 186.5 200 150 100 145.3 134.2 117.3 57.9 50 95.0 79.2 65.0 65.0 40.0 0 FY08 FY09 FY10 EPS FY11 FY12 DPS (Net) Shareholders’ Equity and Net Assets per Share (RM billion) (RM / Share) 4.0 3.5 3.0 2.5 8.8 6.5 6.8 2.8 2.9 7.5 3.7 9.0 10.0 3.8 8.0 6.0 3.1 4.0 2.0 2.0 1.5 1.0 0.0 FY08 FY09 FY10 Shareholders' Equity BATU KAWAN BERHAD FY11 FY12 Net Assets per Share 14 BATU KAWAN BERHAD Thank You