www.ncbc.com
MAY 2012
Saudi Factbook 2012
A Guide to the Kingdom
Equity Research
Farouk Miah, CFA
f.miah@ncbc.com
Tariq Al-Alaiwat
t.alalaiwat@ncbc.com
Iyad Ghulam
i.ghulam@ncbc.com
Mahmood Akbar
m.akbar@ncbc.com
Production
Martin K Arokiaraj
m.raj@ncbc.com
International Client Contact
Please refer to last page for important disclaimer
Asma Dakkak
a.dakkak@ncbc.com
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Contents
EXECUTIVE SUMMARY
3
NCBC RECOMMENDATIONS
4
KSA - ECONOMY AND NATION
7
SAUDI STOCK MARKET
14
Saudi Arabia: Strongest regional market
17
Continued strong earnings growth in 2012E
19
INDUSTRIES & COMPANIES
22
Banking & Financials
24
Petrochemicals
40
Cement
59
Retail
75
Energy & Utilities
88
Agriculture & Food
93
Telecom
110
Insurance
120
Multi Investment
155
Industrial Investment
165
Building & Construction
182
Real Estate
201
Transport
212
Media & Publishing
219
Hotels & Tourism
225
APPENDIX
229
0$<
(;(&87,9(6800$5<
6DXGL$UDELDUHPDLQVRQJURZWKWUDFN
7KH6DXGLHFRQRP\PDLQWDLQVDSRVLWLYHRXWORRNHQKDQFLQJWKH
LQYHVWPHQWFDVHIRUWKH7$6,6WURQJ*'3JURZWKH[SHFWHGLQ
LVFRPELQHGZLWKORZGHEWOHYHOVVWURQJUHVHUYHVDQG
FRQWLQXHGJRYHUQPHQWLQIUDVWUXFWXUHVSHQGLQJPDNLQJWKH6DXGL
HFRQRP\UHVLOLHQWWRDQ\JOREDOVORZGRZQ'HVSLWHWKHJRRG
PDUNHWSHUIRUPDQFHLQ4WKH7$6,UHPDLQVDWDGLVFRXQWWR
KLVWRULFYDOXDWLRQVZLWKJRRGHDUQLQJVJURZWKVXSSRUWLQJXSVLGH
SRWHQWLDORIWKHPDUNHW
6DXGL(FRQRP\UHPDLQVLQDQHQYLDEOHSRVLWLRQ
7KURXJKDFRPELQDWLRQRIKLJKHUWKDQH[SHFWHGLQFRPHIURPSHWURFKHPLFDO
VDOHVFRQWLQXHGLQIUDVWUXFWXUHVSHQGLQJDQGDEXR\DQWGRPHVWLFHFRQRP\*'3
H[SDQGHGE\LQWKHIDVWHVWUDWHLQHLJKW\HDUV*RLQJIRUZDUGWKH
HFRQRPLFRXWORRNUHPDLQVHQFRXUDJLQJHYHQWKRXJKJURZWKPD\VHHVRPH
PRGHUDWLRQLQGXHWRRLOSULFHVUHWUHDWLQJVRPHZKDW7KH,0)H[SHFWV
HFRQRPLFJURZWKWRPDUJLQDOO\VORZGRZQWRLQ
:LWK65EQRIFRQVWUXFWLRQFRQWUDFWVDZDUGHGLQPRUHWKDQGRXEOHWKH
YDOXHLQDQGVXUSDVVLQJWKHSUHYLRXVKLJKRI65EQLQWKLVVKRXOG
VXSSRUWJURZWKLQWKHFRPLQJ\HDUVDVWKHVHSURMHFWVDUHH[HFXWHG:HH[SHFW
RQJRLQJLQIUDVWUXFWXUHVSHQGLQJE\WKHJRYHUQPHQWWRFRQWLQXHWRGULYHWKH
GRPHVWLFHFRQRP\LQ
6DXGLPDUNHWSURILWDELOLW\WRH[FHHG65EQIRUWKHILUVWWLPH
'XHWRVWURQJJURZWKIURPWKHGRPHVWLFDOO\IRFXVHGDQGGHIHQVLYHVHFWRUVVXFK
DV&HPHQW7HOHFRPV5HWDLODQG%DQNVFRXSOHGZLWKKLJKDEVROXWHSURILWVIURP
WKH3HWURFKHPLFDOVHFWRUZHEHOLHYHSURILWDELOLW\IRUWKHOLVWHGFRPSDQLHVVKRXOG
H[FHHG65EQIRUWKHILUVWWLPHLQ:HH[SHFWQHWLQFRPHRIWKHOLVWHG
FRPSDQLHVWRJURZE\<R<LQWR65EQ7KHOLVWHG6DXGL%DQNLQJ
VHFWRUDFFRXQWLQJIRURIWKHIUHHIORDWZHLJKWRIWKH7$6,LVH[SHFWHGWR
UHFRUG<R<SURILWJURZWKRIHTXLYDOHQWWRQHWLQFRPHRI65EQ
7$6,ZHOOSRVLWLRQHGWRJURZDOWKRXJKULVNVH[LVW
:HEHOLHYHWKH6DXGLPDUNHWLVZHOOSRVLWLRQHGWRJURZERWKLQWKHVKRUWDQG
PHGLXPWRORQJWHUP7KH7$6,LVFXUUHQWO\WUDGLQJDW[WUDLOLQJ3(EHORZ
LWVKLVWRULFDYHUDJHRI[DQGWKH[YDOXDWLRQIRUVLPLODUIURQWLHUDQG
HPHUJLQJPDUNHWV7KLVFRPSHOOLQJYDOXDWLRQFRXSOHGZLWKWKHJRRGSURILWJURZWK
H[SHFWDWLRQVIRUWKHPDUNHWDQGOLPLWHGFRUUHODWLRQZLWKRWKHU³PDLQVWUHDP´
HPHUJLQJPDUNHWHFRQRPLHVZHEHOLHYHOHDGVWRDFRPSHOOLQJLQYHVWPHQWFDVH
IRUWKH7$6,
+RZHYHUZHQRWHWKDWWKHFRQWLQXHGJOREDOHFRQRPLFXQFHUWDLQW\SRVHVDULVNWR
WKH6DXGL$UDELDQHFRQRP\:KLOHSURJUHVVKDVEHHQPDGHWRZDUGVUHVROYLQJ
WKH(XUR]RQHGHEWFULVLVDSHUPDQHQWVROXWLRQVWLOOUHPDLQVHOXVLYH6LPLODUO\
JURZWKFRQFHUQVLQWKH86DQGHPHUJLQJHFRQRPLHVFRQWLQXHVWRZHLJKRQ
JOREDOVHQWLPHQW$OOWKHVHIDFWRUVKDYHDSRWHQWLDOWRKROGEDFN6DXGL$UDELD¶V
JURZWKPRPHQWXPZLWKORZHURLOGHPDQGDQGSULFHVWKHNH\LQLWLDOWULJJHU
3
EXECUTIVE SUMMARY
NCB CAPITAL
MAY 2012
NCBC Recommendations
Exhibit 1: Summary of stock coverage
Stock
Current Rating
Al Rajhi (1120.
SE)
Overweight
PT (SR)
90.2
Comments
Al Rajhi¶VORDQERRNLVOikely to grow faster than industry peers benefitting from its
large deposit base. Although the EDQN¶VPDUJLQVDUHFRQWUDFWLQJGXHWRcurrent low
interest rates, the bank will benefit from its lower cost of funds in the long run which
will support NSCI.
Arab National
(1080.SE)
Neutral
32.9
We believe $1%¶VORZHUORDQJURZWKDQGFRPSUHVVHGPDUJLQVLVOLNHO\WRNHHSLWV
total operating income growth muted. However, its improved asset quality is a key
positive which is likely to offset the muted total operating income.
AlBilad
(1140. SE)
Neutral
21.4
$OELODG¶VUHWDLOIRFXVZRXOGHQDEOHDIDVWHUJURZWKLQLWVQHWORDQVDQGLQFUHDVHLWV
NSCI for 2012. In addition, strong non-interest income and improved asset quality
is likely to add to bottom-line. However, operating costs remains a concern for its
profitability.
BJAZ
(1020. SE)
Neutral
19.6
Saudi
Fransi
(1050. SE)
Overweight
38.3
%-$=¶VWRS-line is likely to benefit from both strong loan growth and fee income
aided by strong brokerage revenue from increasing trading volumes on the
Tadawul. However, we believe the potential gains from the surge in market activity
have been priced-in.
.
BSF's retail focus is likely to grow its loan books as well as maintain NIMs. This will
keep its NSCI strong. Although the retail focus will increase operating costs, we
believe strong top-line growth and better asset quality will offset the impact of that
on the bottom-line.
Riyad Bank
(1010. SE)
Overweight
33.2
5,%/¶Vstrong corporate and retail presence is likely to benefit the bank to expand
its credit portfolio and improving its asset quality. ,QDGGLWLRQWKHEDQN¶VDLPWR
maintain margins is likely to enable the bank to post double digit net earnings
growth from 2013.
SABB
(1060. SE)
Overweight
40.5
:HH[SHFW6$%%¶VWRWDORSHUDWLQJLQFRPHLQWREHGULYHQE\loan volumes
and strong fee income. In addition, stable operating expenses and lower provision
charges will enable it to marginal growth in net income.
SAIB
(1030. SE)
Neutral
18.2
6$,%¶VGLYHUVLILFDWLRQVWUDWHJ\WRJURZUHWDLOORDQVwill benefit the bank in long term.
However, stiff competition from established players may pressurize its net interest
margins in the near term..
Samba
(1090.SE)
Overweight
60.6
7KHEDQN¶VDELOLW\WRSRVWUHODWLYHO\VWURQJSURILWDELOLW\GHVSLWHKDYLQJDFRQVHUYDWLYH
approach keeps us positive on the stock. As the high-yielding corporate bonds
mature, Samba will refocus on expanding its loan book and therefore maintain
profitability.
Saudi Hollandi
(1040.SE)
Overweight
32.2
SHB is likely to grow its loan books benefitting from its microfinance initiative. This
is also likely to improve its bottom-line. However, we are concerned about SHB¶V
reliance on Tier II subordinated debt for capital adequacy. Considering stringent
laws of Basel III, the bank might need to increase its equity which would limit future
dividend payouts.
SABIC
(2010.SE)
Overweight
124.5
SABIC benefits from its diversified product mix, an integrated production flow, wide
geographical reach and continued feedstock cost advantage at its facilities in Saudi
Arabia. At current levels, we believe the stock offers an attractive investment
opportunity considering the earnings growth potential and WKHFRPSDQ\¶V sustained
focus on expansion in different product lines and geographies.
Sipchem
(2310.SE)
Overweight
26.7
,Q6LSFKHP¶VRSHUDWLRQDOHIILFLHQF\LPSURYHGDVDOORILWVSODQWV3KDVH1 and
2) were operating at their designed capacities, thereby offering full benefits of an
integrated product flow. Resultant improvement in profitability is expected to drive
WKHFRPSDQ\¶V earnings in 2012E.
4
EXECUTIVE SUMMARY
NCB CAPITAL
MAY 2012
Exhibit 1: Summary of stock coverage
Stock
Current Rating
SAFCO
(2020.SE)
Overweight
NIC (Tasnee)
(2060.SE)
PT (SR)
Comments
212.7
The company's high margins, low capex requirements and short cash conversion
cycle result in high free cash flows and thereby high dividend payments. We
believe continued strength in demand for fertilizers and the SAFCO 5 project would
remain attractive in the long run.
Neutral
36.7
Tasnee is the only titanium dioxide (TiO2) pigment producer in the Middle East and
is monetizing its low-cost feedstock advantage through its petrochemicals
business. Continued rise in TiO2 prices could support 2012E earnings growth;
however, petrochemical prices are likely to remain weak. Any positive earnings
surprises due to higher-than-expected selling prices in the titanium dioxide
business and positive news flow related to the ongoing petrochemical projects are
key stock price catalysts.
Sahara
(2260.SE)
Neutral
18.5
6DKDUD¶V(SHUIRUPDQFHLVH[SHFWHGWREHdriven by the full-year contribution
from its Al Waha plant, which commenced operations in April 2011. Furthermore,
three new start-ups producing acrylates, caustic soda, ethylene dichloride and
superabsorbent polymers are likely to support the company¶V013E earnings.
However, poor earnings from the Al Waha project in 2H11 raises concerns over
Sahara¶VRSHUDWLRQDODELOLW\
Yansab
(2290.SE)
Neutral
48.2
We are optimistic on WKHFRPSDQ\¶VIXWXUHHDUQLQJVJURZWKdue to its low cost
structure and growing demand from emerging economies. However, we believe the
current valuation of stock factors in all positives associated with the company and
offers limited upside potential. Moreover, continued uncertainty over economic
conditions in Europe (the NH\HQGPDUNHWZHLJKKHDYLO\RQ<DQVDE¶VQHDU-term
earnings outlook.
Saudi Kayan
(2350.SE)
Neutral
18.7
A diversified product mix and strong links with SABIC are key positives for the
stock. However, poor performance in 4Q11 indicates Saudi Kayan is facing some
technical issues and is not able to manage the integrated product flow as
anticipated earlier. In our opinion, the compaQ\¶VDELOLW\WRUDPSXSSURGXFWLRQDW
full capacity is imperative for growth in future earnings.
Petrochem
(2002.SE)
Underweight
19.7
The company is scheduled to commence operations in 2Q12 and would be
entering into ethylene and propylene derivatives through a JV with Chevron
Phillips. However, prevailing demand and weakness in pricing are likely to restrict
earnings growth in 2012E. Any update on the project commencement would be a
key catalyst for the stock price.
Yamamah
Cement
(3020.SE)
Neutral
55.8
Strong demand in Riyadh and the ability to sell in different regions are the main
advantages. However, high utilization rate and declining stock level are the key
negatives.
Eastern Cement Neutral
(3080.SE)
59.1
Shifting focus to domestic market due to export, but limitation on exports remains
key downside. Still focused on Eastern region for sales.
Yanbu Cement
(3060.SE)
Neutral
75.2
Demand shift from Central to the western region is key advantage. The company is
ORFDWHGFORVHWRWKHUHJLRQ¶VPDLQSURMHFWV,QDGGLWLRQLWKDVDQHZOLQHRIPQ
tons
Saudi Cement
(3030.SE)
Neutral
82.7
Based in the Eastern region, away from most of the key demand centers. However,
Its high stock level, excess capacity and re-operating its old lines are positives.
Southern
Cement
(3050.SE)
Neutral
99.5
Well positioned for Jizan Economic City in the South. New facility near Makkah with
1.5mn tons should also help. High stock level and excess capacity supports the
outlook.
Qassim Cement Neutral
(3040.SE)
81.4
Lowest cost cement producer in the country with very low inventory levels. Lack of
capacity expansion plans could limit growth.
152.0
Plans to almost double number of stores, coupled with a 50% IT market share,
provide strong platform for the stock. Low liquidity and declining price of laptops a
concern. Store openings the key catalyst for the stock. Valuation is somewhat
stretched at 14.2x 2012e P/E.
Jarir
(4190.SE)
Neutral
5
EXECUTIVE SUMMARY
NCB CAPITAL
MAY 2012
Exhibit 1: Summary of stock coverage
Stock
Current Rating
Al-Hokair
(4240.SE)
Neutral
Al-Othaim
(4001.SE)
PT (SR)
Comments
68.0
Al Hokair is undergoing aggressive international expansion in former Soviet Union
countries such as Kazakhstan and Azerbaijan. We believe this comes with
increased risks vs. its Saudi business. We believe the valuation is not attractive at
11.2x 2013e P/E.
Overweight
115.0
Al Othaim is the number two food retailer in the KSA. It is well positioned to
increase share as market shifts to organized retailing. Entrance of foreign players
and rising COGS are key risks. Store expansion is key catalyst for the stock.
Ongoing RE acquisition is holding back the stock.
Savola
(2050.SE)
Overweight
39.1
Food retail business is expanding aggressively with margins expected to increase
as buying power strengthens. Food business continues to take market share and
H[SDQGJHRJUDSKLFDOO\DFURVVWKHUHJLRQ0RYHWRD³KROGLQJFRPSDQ\´PD\XQORFN
value.
Almarai
(2280.SE)
Neutral
60.4
Geographic expansion of the bakery and juice businesses and the start of
operations at the new poultry venture are key drivers for the stock. Our concerns
are on the pace of progress at poultry, as well as the returns which can be gained
on this SR4bn investment.
Saudi Telecom
Co.
(7010.SE)
Overweight
50.2
Key positives of the stock include its dominance in DSL and its higher and more
secure ARPU levels. Key concerns on the stock are focused on the limited
information available on its international operations as well as FX exposure through
its international investments.
Mobily
(7020.SE)
Overweight
75.5
Key positives of the stock include its dominance in wireless internet access and its
focused strategy. Key concerns on the stock are focused on its declining ARPU
levels and acquisition costs of new customers.
Zain KSA
(7030.SE)
Neutral
7.0
Saudi Electricity Neutral
(5110.SE)
15.3
The new tariff structure on industrial, commercial and government customers came
into effect on July 1, 7KLVKDGDVLJQLILFDQWLPSDFWRQWKHFRPSDQ\¶V
profitability, which we believe the market has already priced into the stock. Going
forward, the key risks include rising cost of energy purchased from independent
producers as well as an increase in depreciation expense.
Dar Al Arkan
(4300.SE)
Neutral
10.8
Dar Al Arkan is currently developing a number of capital-intensive projects;
however, banks and financial institutions could be reluctant to lend to the company
due to allegations of a crisis on its website. Furthermore, investorV¶ perception,
which has been impacted by weak earnings and lack of transparency over the last
few years, could improve if management provides further insight into its land bank.
The stock outperformed the TASI index, reflecting the limited upside potential.
Taiba
(4090.SE)
Overweight
27.6
With a portfolio of prime assets, expected revenue growth and improvement in
PDUJLQVZHEHOLHYH7DLED¶VIXQGDPHQWDOVincluding its status as one of the holiest
cities for Muslims, makes the stock an attractive play in the hospitality sector.
Al-Akaria
(4020.SE)
Neutral
27.3
Good earnings visibility, future growth potential and a large land bank are positives;
however, these are partially offset by a low ROE and risk of excess office supply in
Riyadh.
Key positives of the stock include its attractive and innovative packages and
increasing market share. Key concerns on the stock are focused on its high debt
levels and the financing of this as well as ownership concerns.
Source: NCBC Research
6
0$<
(&2120<$1'1$7,21
.6$¶VHFRQRP\WRVXVWDLQJURZWKPRPHQWXP
*OREDOHFRQRPLFJURZWKVORZHGLQDVWKH(XUR]RQH
FRQWLQXHGWRVWUXJJOHZLWKWKHVRYHUHLJQGHEWFULVLVDQGWKHSDFHRI
WKH86UHFRYHU\UHPDLQHGPXWHG6DXGL$UDELDZLWKVWRRGJOREDO
KHDGZLQGVLQDQGSRVWHGLWVKLJKHVWUDWHRIHFRQRPLFJURZWK
VLQFHDW$OWKRXJKGXHWRWKHKLJKEDVHHIIHFW*'3
JURZWKLVH[SHFWHGWRVORZWRLQ,0)WKH6DXGL
HFRQRP\UHPDLQVLQDVWURQJSRVLWLRQ
5HDOQRQRLO*'3LQFUHDVHGLQRXWSDFLQJWKHJURZWKLQUHDORLO
*'30DQXIDFWXULQJFRQVWUXFWLRQDQG7UDQVSRUW
7HOHFRPPXQLFDWLRQVZHUHWKHOHDGHUVLQWKHQRQRLOHFRQRP\
0RUHRYHU.LQJ$EGXOODKDQQRXQFHGD65EQVRFLDOVSHQGLQJSDFNDJH
ZKLFKLQFOXGHGDWZRPRQWKEDVLFVDODU\ERQXVWRDOOSXEOLFVHFWRUZRUNHUVULVH
LQKRXVLQJORDQVDQGLQFUHDVHLQKHDOWKFDUHVSHQGLQJ7KLVKHOSHGLQERRVWLQJ
GRPHVWLFFRQVXPSWLRQZKLFKH[SDQGHGE\LQFXUUHQWSULFHVLQXS
IURPWKHJURZWKUHFRUGHGLQ
$VXVWDLQHGLQFUHDVHLQJRYHUQPHQWVSHQGLQJVLQFHKDVDOVRKHOSHGERRVW
QRQRLO*'3LQWKH.LQJGRP0RVWRIWKHLQFUHDVHLQH[SHQGLWXUHKDVEHHQ
DLPHGDWLPSURYLQJKXPDQDQGSK\VLFDOLQIUDVWUXFWXUH$IWHULQFUHDVLQJLQ
WKHJRYHUQPHQWLVVHWWRLQFUHDVHH[SHQGLWXUHE\DURXQGLQ
RYHUWKHEXGJHWHGILJXUHIRU([SHFWDWLRQVRIVWDEOHRLOSULFHVDURXQGWKH
86EEOOHYHOLVOLNHO\WRKHOSWKH.LQJGRPVXSSRUWLWVILVFDOSRVLWLRQHYHQDV
LWIXQGVPRUHQRQRLOH[SDQVLRQ
Exhibit 2:Real GDP - CAGR (2008±13E)
Exhibit 3: Annual change in real GDP
:RUOG
%UD ]LO
&KLQD
,QGLD
6RXUFH,0)1&%&5HVHDUFK
-DSDQ
5XVVLD
.6$
8.
86
-DSDQ
8.
(
86
(
.6$
)
6RXUFH,0)1&%&5HVHDUFK
,Q6DXGL$UDELDEHQHILWHGIURPLQFUHDVHGRLORXWSXWDVSURGXFWLRQZDV
LQFUHDVHGWRILOOWKHJDSFDXVHGE\WKHXQUHVWLQ/LE\D3URGXFWLRQSHDNHGDW
FORVHWRPQESGLQ$XJXVWEHIRUHGHFUHDVLQJWRZDUGVWKHHQG7KH
LQFUHDVHLQRLOSURGXFWLRQDQGUHODWLYHO\VXVWDLQHGVWUHQJWKLQRLOSULFHVKHOSHG
LQFUHDVH*'3JURZWKDQGVWUHQJWKHQJRYHUQPHQWEDODQFHVIXUWKHU$FFRUGLQJWR
WKH,0)WKHILVFDOVXUSOXVJUHZWRRIWKH*'3LQIURPLQ
7KHLPSDFWRIKLJKHURLOSULFHVDQGSURGXFWLRQZDVDOVRHYLGHQWLQH[SRUW
HDUQLQJVZLWKJRRGVDQGVHUYLFHVH[SRUWVLQFUHDVLQJLQ,0)
,PSRUWVJUHZDWDVORZHUSDFH
7
(&2120<$1'1$7,21
1&%&$3,7$/
0$<
6HSDUDWHO\LQIODWLRQUHPDLQHGUHODWLYHO\HOHYDWHGLQGXHWRULVLQJIRRG
LQIODWLRQDQGKLJKHUGRPHVWLFUHQWV7KHUHQWUHODWHGFRPSRQHQWRIWKH
&RQVXPHU3ULFH,QGH[&3,LQFUHDVHGIROORZHGE\IRRGSULFHLQIODWLRQ
$VDUHVXOWRYHUDOO&3,URVH+RZHYHULQORZHULQJRIJOREDO
IRRGSULFHVVLQFHWKHKLJKRI4LVVHWWRHDVHGRPHVWLFLQIODWLRQHVSHFLDOO\
ZLWKDKLJKEDVHHIIHFWDOVRFRPLQJLQWRSOD\WKH,0)H[SHFWVGRPHVWLFLQIODWLRQ
WRPRGHUDWHWRDURXQGLQ
Exhibit 4: Saudi Arabia macroeconomic indicators
8QLWVDVLQGLFDWHG
Indicator
5HDO*'3JURZWK
+\GURFDUERQ
1RQK\GURFDUERQ
,QIODWLRQ
&XUUHQWDFFRXQWEDODQFH
RI*'3
)LVFDOEDODQFHRI*'3
2007
2008
2009
2010
2011
2012E
2013E
RXUFH,0)5HJLRQDO(FRQRPLF2XWORRN±0(1$UHJLRQ$SULO1&%&5HVHDUFK
Exhibit 5: Shares of oil and non-oil sector in total GDP
Exhibit 6: Shares in total non-oil GDP
*RYHUQ PH QWVHUYLFH V
&RQVWUX FWLRQ
0DQXIDFWX ULQJQRQ RLO
3
1RQRLO*'3
2LO*'3
6RXUFH&HQWUDO'HSDUWPHQWRI6WDWLVWLFV,QIRUPDWLRQ1&%&5HVHDUFKGDWDLV
SURYLVLRQDO
3ULYDWHVH UYLFHV
(OHFWULFLW\*DVD QG:D WHU
$JU LFXO WXUH
6RXUFH&HQWUDO'HSDUWPHQWRI6WDWLVWLFV,QIRUPDWLRQ1&%&5HVHDUFKGDWDLV
SURYLVLRQDO
*RYHUQPHQWFRQWLQXHVWREHSURDFWLYHLQVWLPXODWLQJJURZWK
$VLQSUHYLRXV\HDUVWKH6DXGL$UDELDQJRYHUQPHQWFRQWLQXHGLWVH[SDQVLRQDU\
ILVFDOSROLF\LQWRSURPRWHJURZWKDQGLPSURYHKXPDQDQGSK\VLFDO
LQIUDVWUXFWXUH$FWXDOH[SHQGLWXUH65EQGXULQJZDVKLJKHUWKDQ
WKHEXGJHWHGILJXUH65EQ$ODUJHSDUWRIWKLVLQFUHDVHFDQEHDWWULEXWHGWR
.LQJ$EGXOODK¶V65EQVRFLDOVSHQGLQJSDFNDJHDQQRXQFHGGXULQJWKHILUVW
KDOIRIWKH\HDU7KHSDFNDJHZDVSULPDULO\LQWHQGHGWRDGGUHVVLQFRPHOHYHOV
DQGVRFLDOZHOIDUHLVVXHVOLNHKHDOWKFDUHDQGKRXVLQJHVSHFLDOO\IRUORZLQFRPH
LQGLYLGXDOV65EQKDVEHHQDOORFDWHGIRUKRXVLQJDORQHWKHPRQH\ZLOOEH
VSHQWRYHUWKHQH[WIHZ\HDUVLQFRQVWUXFWLQJQHZKRXVLQJXQLWV
(QFRXUDJLQJO\GHVSLWHWKLVILVFDOH[SDQVLRQ6DXGL$UDELD¶VEXGJHWUHJLVWHUHGD
VXUSOXVRI65EQDVKLJKRLOUHYHQXHVPRUHWKDQRIIVHWKLJKHUVSHQGLQJ$W
WKHVDPHWLPHWKH.LQJGRPPDQDJHGWRUHGXFHRYHUDOOJURVVGHEWVLJQLILFDQWO\
7KXVZKLOHPDMRUJOREDOHFRQRPLHVDUHJUDSSOLQJZLWKIDLOLQJILVFDOKHDOWKWKH
.LQJGRPFRQWLQXHVWRFRQVROLGDWHILQDQFHVZLWKDULVHLQILVFDOVXUSOXVGHFOLQLQJ
GHEWEXUGHQDQGKLJKHUIRUHLJQUHVHUYHVDFFRUGLQJWR,0)GDWDJURVVRIILFLDO
UHVHUYHVLQFUHDVHGWR86EQLQIURP86EQLQ
0HDQZKLOHLQRUGHUWRVXSSRUWOLTXLGLW\DQGPDLQWDLQORZFRVWIRUERUURZHUVWKH
6DXGL$UDELDQ0RQHWDU\$JHQF\6$0$PDLQWDLQHGDVWDEOHPRQHWDU\SROLF\E\
8
(&2120<$1'1$7,21
1&%&$3,7$/
0$<
NHHSLQJLWVEHQFKPDUNLQWHUHVWUDWHUHYHUVHUHSRDW7KLVLVQRWVXUSULVLQJ
JLYHQWKDW6$0$KDVWRPDWFK86)HGHUDO5HVHUYH¶VSROLF\DVWKHUL\DOLV
SHJJHGWRWKH86GROODU
Exhibit 7: Fiscal balance and gross debt
$VRI*'3
*URVVGHEW
(
)
)LVFDOEDODQFH
6RXUFH,0)5HJLRQDO(FRQRPLF2XWORRN±0(1$UHJLRQ$SULO1&%&5HVHDUFK
5HVLOLHQWILQDQFLDOVHFWRU
Banking sector fundamentals remain sound
6DXGL$UDELDQEDQNVKDYHFRQWLQXHGWRH[KLELWVWURQJOLTXLGLW\PHDVXUHKHQFH
LWLVSRLVHGWRVXSSRUWVWURQJHUGHPDQGIRUORDQVLQ7KH6DXGLEDQNLQJ
VHFWRUKDVDPRQJWKHORZHVWORDQWRGHSRVLWUDWLRVLQWKH*XOIDQGLVPLQLPDOO\
H[SRVHGWRUHDOHVWDWH'RPHVWLFEDQNVKDYHVWURQJILQDQFLDOUDWLRVZLWK13/V
DWRIWRWDOORDQVFDSLWDODGHTXDF\UDWLRRIRIWKHULVNZHLJKWHG
DVVHWVDQGUHWXUQRQDVVHWVDW
%DQNORDQJURZWKWRWKHSULYDWHVHFWRUURVHWRDURXQGLQFRPSDUHG
WRLQ$OWKRXJKFUHGLWJURZWKLVSLFNLQJXSJUDGXDOO\IURPQHJDWLYH
OHYHOVLQWKHSDFHRIJURZWKLVOLNHO\WRDFFHOHUDWHDVWKHHFRQRP\
VWUHQJWKHQV
KSA successfully launches project sukuk
7KH6DXGL$UDELDQVXNXNPDUNHWKDVJURZQVLJQLILFDQWO\LQUHFHQW\HDUVDQG
KDVWKHSRWHQWLDOWREHFRPHDPDMRUVRXUFHRIIXQGLQJIRUWKHFRUSRUDWHVHFWRU
/HDGLQJEOXHFKLSQDPHVQRWDEO\6DXGL(OHFWULFLW\&RDQG6DXGL%DVLF
,QGXVWULHV&RUS6$%,&KDYHUHSHDWHGO\WDSSHGWKHPDUNHWWRUDLVHIUHVK
IXQGV
7KHVXNXNPDUNHWJDLQHGIXUWKHUPRPHQWXPLQDIWHUZLWQHVVLQJVWURQJ
JURZWKLQZLWKVL[QHZLVVXDQFHVZRUWK86EQ,Q6HSWHPEHUWKH
.LQJGRPVXFFHVVIXOO\ODXQFKHGWKHZRUOG¶VILUVWSURMHFWVXNXNZKLFKZDVZRUWK
65EQIRU6DXGL$UDPFR7RWDO5HILQLQJDQG3HWURFKHPLFDO&RPSDQ\
6$7253DMRLQWYHQWXUHEHWZHHQ6DXGL$UDPFRDQG7RWDODOHDGLQJ
PXOWLQDWLRQDOHQHUJ\FRPSDQ\7KHPRPHQWXPLQWKHVXNXNPDUNHWVKDV
FRQWLQXHGLQZLWKWKH6DXGL$UDELDQ*HQHUDO$XWKRULW\IRU&LYLO$YLDWLRQ
*$&$ODXQFKLQJWKH.LQJGRP¶VILUVWHYHUVRYHUHLJQJXDUDQWHHGVXNXNZRUWK
65EQLQ-DQXDU\7KH6DXGL$UDELDQ6WRFN([FKDQJH7DGDZXOFXUUHQWO\KDV
DVHFRQGDU\WUDGLQJSODWIRUPIRUVXNXNZLWKHLJKWOLVWHGLVVXDQFHVDVRI
'HFHPEHU7KH.LQJGRPLVORRNLQJDWWKHSRVVLELOLW\RIILQDQFLQJYDULRXV
LQIUDVWUXFWXUHSURMHFWVWKURXJKVXNXNLVVXDQFH
TASI has strong start to 2012, although some set-backs recently
,QOLQHZLWKLWVJOREDOSHHUV6DXGL$UDELD¶VHTXLW\PDUNHWIDFHGWKHIDOORXWRIWKH
(XUR]RQHVRYHUHLJQGHEWFULVLVLQZLWKWKHEHQFKPDUN7$6,GHFOLQLQJ
+RZHYHUWKHLQGH[SHUIRUPHGEHWWHUWKDQVHYHUDORILWVNH\JOREDODQG
9
(&2120<$1'1$7,21
1&%&$3,7$/
0$<
*&&SHHUVGXHWRLWVUHODWLYHO\VWURQJHFRQRPLFDQGVWUXFWXUDOIXQGDPHQWDOV
)RUH[DPSOHWKH$EX'KDEL$OO6KDUHV,QGH[IHOO*HUPDQ'$;
GHFOLQHGDQG1LNNHLZDVGRZQLQ
7KHHTXLW\PDUNHWLQ6DXGL$UDELDKDVPDGHDVWURQJVWDUWLQDOWKRXJKRI
ODWHVRPHWKLVKDVEHHQQHJDWHG:HEHOLHYHPXFKRIWKHUHDVRQEHKLQGWKH
JRRGVWDUWLVGXHWRORFDOIDFWRUVVXFKDVWKH0DNNDKDQG0DGLQDK
FRPSHQVDWLRQPRQLHVIURPFRPSXOVRU\SXUFKDVHRUGHUVEHLQJUHGLUHFWHGLQWR
WKHHTXLW\PDUNHWV7KLVDORQJVLGHLQYHVWRUVPRYLQJDVVHWVRXWRIUHDOHVWDWHLQ
WRHTXLWLHVDVZHOODVLPSURYLQJJOREDOVHQWLPHQWLQ4DLGHGWKHVWURQJ
SHUIRUPDQFHLQWKLVSHULRG7KH<7'SHDNRFFXUUHGRQ$SULOUGZKHQWKH
PDUNHWZDVXS+RZHYHUVLQFHWKHQWKHPDUNHWKDVEHHQGRZQIRUILYH
ZHHNVZLWKLWVWDELOL]LQJDWDURXQGWKHOHYHODWWKHEHJLQQLQJRI0D\7KLV
FRUUHFWLRQFDQEHDWWULEXWHGWRWKHUHQHZHGIHDUVRYHU(XURSHGXHWRWKH
RXWFRPHRIWKH*UHHNDQG)UHQFKHOHFWLRQVFRQFHUQVRYHUWKHHFRQRPLF
VORZGRZQLQ&KLQDDQGWKHQRUPDOVXPPHUOXOOZKLFKRFFXUVLQ6DXGL$UDELD
Exhibit 8: TASI performance in 2011
Exhibit 9: TASI performance in 2012 (YTD return)
-DQ
)HE 0DU
$SU 0D\ -XQ -XO $XJ 6HS 2FW
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
1RY 'HF
-DQ -DQ -DQ )HE )HE 0DU 0DU $SU $SU 0D\
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
Significant expansion in TASI volumes/value traded
<R<WKHUHKDVEHHQDVLJQLILFDQWLQFUHDVHLQWKHYROXPHVDQGDYHUDJHGDLO\
YDOXHWUDGHG<7'WKHDYHUDJHYDOXHWUDGHGKDVDYHUDJHG65EQPRUH
WKDQGRXEOHWKH65EQUHFRUGHGLQDQGFRPSDUHGWRWKH65EQLQ
7KHWRWDOYDOXHRIVKDUHVWUDGHGSHDNHGDW65EQLQ0DUFKWKHKLJKHVW
VLQFH0DUFK2IIWKHEDFNRIWKHSRLQWVPHQWLRQHGDERYHWKHUHKDVEHHQD
UHQHZHGOHYHORILQWHUHVWLQWKHORFDOHTXLW\PDUNHWVIURPORFDOUHWDLOLQYHVWRUV
OHDGLQJWRWKLVLQFUHDVHLQDFWLYLW\
*RYHUQPHQWEXGJHWVIRUVXUSOXVLQ
7KHJRYHUQPHQW¶VSULPDU\IRFXVRYHUWKHSDVWIHZ\HDUVKDVEHHQWRERRVW
LQIUDVWUXFWXUHWRIRVWHUDVWURQJGLYHUVLILHGHFRQRP\*RYHUQPHQWVXSSRUWKDV
EHFRPHPRUHSURQRXQFHGRYHUWKHODVWFRXSOHRI\HDUVDVLWKDVXQGHUWDNHQ
VWLPXOXVPHDVXUHVGXHWRIDOOLQJRLOSULFHVDQGFRQWLQXHGZLWKLWVORQJWHUP
GLYHUVLILFDWLRQDJHQGDDWWKHVDPHWLPH)LJXUHVIURPWKHUHFHQWO\DQQRXQFHG
EXGJHWIRULQGLFDWHWKDWWKHJRYHUQPHQWKDVDOORFDWHGDWRWDORI65EQ
RURIWRWDOH[SHQGLWXUHIRUQHZDQGRQJRLQJSURMHFWV$SDUWIURP
EXGJHWDU\RXWOD\VFRQWLQXHGFRPPLWPHQWWRWKHILYHHFRQRPLFFLWLHVDOVR
UHIOHFWVWKHJRYHUQPHQW¶VREMHFWLYHWRERRVWLQGXVWULDODQGHPSOR\PHQWLQWKH
HFRQRP\
7KHEXGJHWFRQWLQXHVWRIRFXVRQLPSURYLQJKXPDQDQGSK\VLFDO
LQIUDVWUXFWXUHZLWKEXGJHWHGH[SHQGLWXUHVHWWRLQFUHDVHWR65EQ
FRPSDUHGWRWKHEXGJHWHGILJXUHRI65EQIRU+RZHYHUWKLVILJXUHLV
10
(&2120<$1'1$7,21
1&%&$3,7$/
0$<
ORZHUWKDQWKHDFWXDORXWOD\RI65EQLQ$VLQWKHSUHYLRXV\HDUVWKH
EXGJHWVWDWHPHQWLGHQWLILHGKHDOWKHGXFDWLRQDQGWUDQVSRUWDVWKHSULRULW\
VHFWRUV(GXFDWLRQDQGWUDLQLQJKDYHUHFHLYHGRU65EQRIWRWDO
EXGJHWDU\VSHQGLQJ$OORFDWLRQVWRWUDQVSRUWDWLRQWHOHFRPPXQLFDWLRQVDQG
KHDOWKLQFUHDVHGWR65EQRURIWRWDOEXGJHWHGVSHQGLQJ
,QWHUHVWLQJO\IRUWKHILUVWWLPHVLQFHWKHJRYHUQPHQWKDVEXGJHWHGIRU
VXUSOXVLQ7KHEXGJHWHVWLPDWHVUHYHQXHVDW65EQDQGDVXUSOXVRI
65EQWKHILUVWSURMHFWHGVXUSOXVVLQFH
,QIODWLRQH[SHFWHGWRUHPDLQPDQDJHDEOH
:KLOHLQIODWLRQUHPDLQHGHOHYDWHGLQGXHWRULVLQJSULFHVRIIRRGDQG
KRXVLQJUHODWHGLWHPVLWKDVVKRZQVLJQVRIPRGHUDWLRQLQUHFHQWPRQWKV,Q
DGGLWLRQWKHJRYHUQPHQWKDVEHHQSURYLGLQJSULFHVXEVLGLHVRQDUDQJHRIEDVLF
JRRGVVXFKDVIRRGDQGHOHFWULFLW\WRKROGEDFNLQIODWLRQ
+RZHYHUWKHQHZ1LWDTDWODERUTXRWDV\VWHPLQWURGXFHGLQ1RYHPEHU
SRVHVZDJHSXVKLQIODWLRQULVNV8QGHUWKHV\VWHPILUPVDUHUHTXLUHGWRKLUH
UHODWLYHO\H[SHQVLYHORFDOZRUNHUVWRLPSURYHWKHLU1LWDTDWUDQNLQJ7KLVLVLQ
DGGLWLRQWRWKHDOUHDG\LQFUHDVHGPLQLPXPZDJHVWR65IRUSXEOLFVHFWRU
HPSOR\HHV
0RQHWDU\SROLF\ZLOODOVRSXWXSZDUGSUHVVXUHRQLQIODWLRQDV6$0$LVH[SHFWHG
WRNHHSLQWHUHVWUDWHVORZLQOLQHZLWK86)HGHUDO5HVHUYH¶VGLVFRXQWUDWHWR
PDLQWDLQWKH5L\DO±GROODUSHJ
Exhibit 10: KSA CPI, housing and food inflation
0DU
6HS 0DU
6HS 0DU
*HQ HUDO,Q GH[
6HS 0DU
)RRG
6HS 0DU
6HS 0DU
+RXVLQJ
6RXUFH6$0$1&%&5HVHDUFK
+RZHYHU.6$¶VHFRQRP\UHPDLQVH[SRVHGWRFKDOOHQJHV
6WURQJJURZWKLQWKHQRQRLOVHFWRUKDVEHHQLQVWUXPHQWDOLQSURYLGLQJVXSSRUWWR
WKHRYHUDOOHFRQRP\IRUWKHODVWFRXSOHRI\HDUV:KLOHWKLVWUHQGLVHQFRXUDJLQJ
WKH.LQJGRP¶VHFRQRP\LVVWLOOUHOLDQWRQFUXGHRLOH[SRUWV7KLVH[SRVHVWKH
HFRQRP\WRWKHULVNRIDGYHUVHRLOSULFHPRYHPHQW2LODQGUHODWHGVHFWRUV
FRQWLQXHWRFRQWULEXWHDURXQGRIWRWDOJRYHUQPHQWUHYHQXHV7KHUHIRUH
HYHQWKRXJKWKH.LQJGRPFRQWLQXHVWRHQMR\DQRYHUDOOILVFDOVXUSOXVQRQRLO
ILVFDOGHILFLWDVVKDUHRIQRQRLO*'3KDVVXUJHGWRLQIURP
LQ
11
(&2120<$1'1$7,21
1&%&$3,7$/
0$<
Exhibit 11: Share: Oil and non-oil in total revenues (%)
Exhibit 12: Non-oil fiscal deficit (% of non-oil GDP)
2LOUHYHQX H
1RQRL OUHYHQ XH
(
(
6RXUFH6$0$,0)DQGILJXUHV1&%&5HVHDUFK
(
6RXUFH,0)5HJLRQDO(FRQRPLF2XWORRN±0(1$UHJLRQ$SULO1&%&5HVHDUFK
$OWKRXJKRLOSULFHVORRNWRUHPDLQVWDEOHLQRQJRLQJFRQFHUQVRYHUWKH
KHDOWKRIWKHJOREDOHFRQRP\PD\OHDGWRXQH[SHFWHGSULFLQJSUHVVXUH2QWKH
RWKHUKDQGDOWKRXJKEHQHILFLDOWRWKH6DXGL$UDELDQHFRQRP\LQWKHVKRUWWHUP
DVWHDG\LQFUHDVHLQRLOSULFHVPD\SRVHULVNVWRJOREDOJURZWKZKLFKLQWXUQ
FRXOGDGYHUVHO\LPSDFW.6$¶VHFRQRP\LQWKHPHGLXPWHUP
Bank credit remains subdued
7RWDOFUHGLWJURZWKURVHWRLQDIWHULQFUHDVLQJLQ(YHQ
WKRXJKJURZWKKDVSLFNHGXSLWLVZHOOEHORZWKHSHDNRIDURXQGGXULQJ
±7KLVWUHQGFRXOGEHGXHWRWKHVWULQJHQWOHQGLQJQRUPVDGRSWHGE\
EDQNV%DQNVKDYHEHHQUHOXFWDQWWRUHVWDUWOHQGLQJDQGKDYHEHHQIRFXVLQJRQ
EXLOGLQJXSWKHLUFDSLWDODGHTXDF\OHYHOV,QWURGXFWLRQRIVDODU\FDSVE\WKH
FHQWUDOEDQNKDVDOVRGLVFRXUDJHGOHQGLQJ&XUUHQWO\WRWDOPRQWKO\ORDQ
UHSD\PHQWVFDQQRWH[FHHGRIWKHERUURZHU¶VPRQWKO\VDODU\
+RZHYHUOHQGLQJLVH[SHFWHGWRSLFNXSLQDVEXVLQHVVFRQILGHQFHUHYLYHV
DQGWKHHFRQRP\FRQWLQXHVWRJURZ6$0$¶VUROHLQHQVXULQJVWDEOHOLTXLGLW\LQ
WKHEDQNLQJV\VWHPKDVDOVRKHOSHGWRVXSSRUWFRQILGHQFH
Exhibit 13: Credit to private and public sector
65EQ
4 4 4 4 3XE OLF6HFWRU
4 4 4 3ULYDWH6HFWR U
4 4 4 4 4 &UHGLWJ URZWK 5+6
6RXUFH6$0$1&%&5HVHDUFK
(FRQRPLFRXWORRNUHPDLQVHQFRXUDJLQJJOREDOULVNVSHUVLVW
'HVSLWHVWURQJJOREDOKHDGZLQGVWKHJURZWKRIWKH6DXGL$UDELDQHFRQRP\LQ
ZDVWKHIDVWHVWVLQFH0XFKRIWKLVJURZWKLVDVFULEHGWRDQLQFUHDVH
LQRLOSURGXFWLRQDQGFRQWLQXHGKLJKSULFHV*RLQJIRUZDUGWKHRXWORRNUHPDLQV
HQFRXUDJLQJHYHQWKRXJKJURZWKPD\VHHVRPHPRGHUDWLRQLQDV
JRYHUQPHQWVSHQGLQJUHGXFHVDQGRLOSULFHVVWDELOL]H7KH,0)H[SHFWV
HFRQRPLFJURZWKWRPDUJLQDOO\VORZGRZQWRLQ7KLV*'3JURZWK
12
(&2120<$1'1$7,21
1&%&$3,7$/
0$<
FRXSOHGZLWKRQJRLQJJRYHUQPHQWLQLWLDWLYHVVKRXOGOHDGVWRDVWURQJRXWORRNIRU
WKH6DXGLHFRQRP\
+RZHYHUJOREDOHFRQRPLFDQGJHRSROLWLFDOULVNVFRQWLQXHWRZHLJKRQWKH
HFRQRPLFVHQWLPHQW5LVNVIURPWKH(XURSHDQVRYHUHLJQGHEWFULVLVFRQWLQXH
ZLWKWKHUHFHQWUHVXOWVRIWKH)UHQFKDQG*UHHNHOHFWLRQVEULQJLQJGRXEWXSRQ
WKHFXUUHQW³DXVWHULW\´GULYHQVROXWLRQ6LPLODUO\LQWKH86ZKLOHJURZWK
PRPHQWXPKDVSLFNHGXSLQUHFHQWPRQWKVLWKDVQRWEHHQHQRXJKWREULQJ
GRZQKLJKXQHPSOR\PHQWOHYHOVZKLFKFRQWLQXHVWREHDERYHWKHPDUN
(YHQLQHPHUJLQJPDUNHWVWLJKWPRQHWDU\SROLF\RYHUWRWDPHLQIODWLRQ
KDVOHGWRDGHFHOHUDWLRQLQJURZWK$OOWKLVJOREDOXQFHUWDLQW\KDVWKHSRWHQWLDOWR
DGYHUVHO\LPSDFWHFRQRPLFJURZWKLQWKH.LQJGRPSULPDULO\WKURXJKWKHLPSDFW
RIORZHUK\GURFDUERQSULFHV
13
0$<
.6$672&.0$5.(7
6LJQLILFDQWLQFUHDVHLQPDUNHWDFWLYLW\
7KH7$6,KDVVHHQDVXEVWDQWLDOLQFUHDVHLQDFWLYLW\<7'ZLWK
DYHUDJHGDLO\YDOXHWUDGHGXS<R<WR65EQ7KHLQGH[
ZDVXSDWLWVSHDNDOWKRXJKKDVIDOOHQEDFNVRPHZKDWDQGLV
QRZXSDVRI0D\DWDURXQGWKHOHYHO'HVSLWH
WKHVWURQJVWDUWWRWKH\HDUWKHPDUNHWUHPDLQVDWWUDFWLYHDW[
WUDLOLQJ3(DJDLQVWWKHDYHUDJHRI[:LWKWKHJURZWKLQPDUNHW
HDUQLQJVUHPDLQLQJVWURQJLQWKHFRPLQJ\HDUVZHEHOLHYHWKHUHLV
DFRPSHOOLQJLQYHVWPHQWFDVHIRUWKHORFDOPDUNHW
7KH6DXGLPDUNHWKDVRXWSHUIRUPHGWKHPDMRULW\RIUHJLRQDOSHHUVLQ<7'
,QIDFWDOO*&&PDUNHWVH[FHSW4DWDU¶V'60DUHWUDGLQJDWKLJKHUOHYHOVLQ
<7'7KHJRRGJURZWKLQHDUQLQJVDFURVVWKHUHJLRQLQ4KDVKHOSHGLQ
NHHSLQJLQYHVWRUVHQWLPHQWKLJK7KH7$6,ZDVXSDVRI0D\
VHFRQGRQO\WR'XEDLZKLFKURVHGXULQJWKHVDPHSHULRG4DWDU
KRZHYHULVGRZQ<7'
Exhibit 14: TASI performance
7$6,,QGH[OHYHOVIRUIURPXQWLO<7'
26 April 2010: 13% rise
YTD, but Euro/Greece
reverse the trend
25 Nov 2009: Dubai
World debt
standstill drives the
market down
03April2012: TASI touches 7,930
TASI ends the
year down 3.1%
June 2009: Saad/Al Gosaibi
troubles emerge, impacting Saudi TASI ends the year up 27.5%, but down
as well as regional markets
4% from its peak in November
$SU
)HE
'HF
2FW
$XJ
-XQ
$SU
)HE
'HF
2FW
$XJ
-XQ
$SU
)HE
'HF
2FW
$XJ
$SU
-XQ
)HE
'HF
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
6DXGLPDUNHWWDNHVFHQWHUVWDJH
$PRQJUHJLRQDOPDUNHWVZHEHOLHYHWKH6DXGLPDUNHWRIIHUVDFRPSHOOLQJYDOXH
SURSRVLWLRQODUJHO\GXHWRLWVVWURQJPDFURHFRQRPLFIXQGDPHQWDOV7KH.LQJGRP
KDVWKHODUJHVWDQGPRVWGLYHUVHHFRQRP\ZLWKDVWURQJRXWORRNZLWKWKHPDUNHW
DOVRWKHODUJHVWLQWHUPVRIPDUNHWFDSLWDOL]DWLRQDQGOLTXLGLW\6KRUWWHUPIDFWRUV
VXFKDVUHDVRQDEOHYDOXDWLRQVUHFRPPHQFHPHQWRIPDUJLQOHQGLQJE\EDQNV
LQYHVWRUVPRYLQJRXWRI5HDO(VWDWHKDYHEHHQDLGLQJWKH7$6,¶VSRVLWLYH
PRPHQWXP<7'LQ7KHLQGH[UHDFKHGDWKUHHDQGDKDOI\HDUKLJKDW
RQ$SULO:HEHOLHYHWKHULVHLQYROXPHV<7'DOVRLQGLFDWHDQ
LPSURYHPHQWLQLQYHVWRUFRQILGHQFHLQWKH.LQJGRP9ROXPHVDUHWUDGLQJDW
VXEVWDQWLDOO\HOHYDWHGOHYHOVFRPSDUHGWRWKHSUHYLRXVWKUHH\HDUVDYHUDJH
GDLO\YDOXHWUDGHGUHDFKHGDILYH\HDUKLJKRI65EQRQ0DUFK
7$6,¶VFXUUHQWVKDUHLQ*&&YDOXHWUDGHGLQFUHDVHGWRDURXQGGXULQJ4
IURPLQDQGLQ
$JJUHJDWHPDUNHWHDUQLQJVJUHZWR65EQ86'EQLQOHGE\WKH
SHWURFKHPLFDOVHFWRUQHWLQFRPHXS:HH[SHFWPDUNHWHDUQLQJVWR
JURZE\LQHH[FHHGLQJWKH65EQOHYHOIRUWKHILUVWWLPH:LWKWKH
7$6,WUDGLQJDW[HDUQLQJVYHUVXVDQDYHUDJHRI[LQWKHODVWWKUHH
14
.6$672&.0$5.(7
1&%&$3,7$/
0$<
\HDUVWKHPDUNHWORRNVIDUIURPH[SHQVLYH:HEHOLHYHWKHFRPELQDWLRQRIDQ
LQH[SHQVLYHYDOXDWLRQDQGVWHDG\HDUQLQJVJURZWKSURYLGHVDSRVLWLYHRXWORRNIRU
WKH7$6,
Exhibit 15: 2011 GCC market performance
Exhibit 16: 2012 YTD GCC market performance
SHUIRUPDQFHRI*&&PDUNHWV
<7'SHUIRUPDQFHRI*&&PDUNHWV
%DK UDLQ
'XEDL
.XZDLW
2PDQ
$EX 'KDE L
7$6,
4DWDU
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
'XEDL
7$6,
.XZDLW
2PDQ
%DK UDLQ
$EX 'KDE L
4DWDU
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
<7'WR$SULO
7KHNH\ULVNWRRXUSRVLWLYHRXWORRNRQWKH7$6,LVWKHSDFHRIUHFRYHU\RIWKH
JOREDOHFRQRP\,IWKLVLVPXFKVORZHUWKDQH[SHFWHGWKLVLQWXUQFRXOGOHDGWRD
VORZGRZQLQRLOGHPDQGDQGVXEVHTXHQWO\RLOSULFHV)XUWKHUPRUHWKHHFRQRP\
DOVRUHPDLQVYXOQHUDEOHWRWKHFKDOOHQJHVRILQIODWLRQDU\SUHVVXUHVHVSHFLDOO\
JLYHQWKHUHFHQWXSZDUGWUHQGLQKRXVLQJUHODWHGLQIODWLRQDQGHOHYDWHGJOREDO
IRRGSULFHV
7$6,PDUJLQDOO\ORZHULQ
7$6,¶VSHUIRUPDQFHGRZQ<R<ZDVPL[HGUHODWLYHWRWKHGHYHORSHGDQG
HPHUJLQJPDUNHWVLQ:LWKLQWKHHPHUJLQJPDUNHWVLWRXWSHUIRUPHG%UD]LO
&KLQDDQG,QGLDKRZHYHULWXQGHUSHUIRUPHGFRPSDUHGWRPDUNHWVVXFKDV
5XVVLDDQG6RXWK$IULFD2QJRLQJFRQFHUQVRQWKHSDFHRIWKHJOREDOUHFRYHU\
LQJHQHUDODQGWKHGHEWLVVXHVLQ(XURSHLQSDUWLFXODUZHUHWKHPDLQSRLQWVRI
FRQFHUQLQ
)URPDJOREDOSHUVSHFWLYHVWRFNPDUNHWVKDYHJHQHUDOO\PRYHGXSLQ4RQ
SRVLWLYH86HFRQRPLFGDWDDQGDQLPSURYHPHQWLQOLTXLGLW\LQ(XURSH$WWKHHQG
RI4WUDGLQJLQILYHRIWKHVHYHQ*&&LQGLFHVZDVKLJKHUYHUVXVWKHVWDUWRI
Exhibit 17: 2011 performance vs global peers
Exhibit 18: 1Q12 performance vs global peers
JOREDOPDUNHWSHUIRUPDQFH
4JOREDOPDUNHWSHUIRUPDQFH
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
7$6,
1DVGDT
1LNNHL
+DQJ
6HQ J
%UD ]LO
6KD QJKDL
'RZ
-RQHV
(XU R7R S
'RZ-RQH V
1DVGDT
7$6,
(XU R7R S %UD ]LO
1LNNHL
+DQJ6HQ J
6KD QJKDL
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
<7'WR$SULO
15
.6$672&.0$5.(7
1&%&$3,7$/
0$<
6HFWRUSHUIRUPDQFHLQ6ORZGRZQLQSHWURFKHPLFDOVDQG
EDQNLQJFHPHQWDQGUHWDLOVWURQJ
7KH7$6,ZDVGRZQLQZLWKPL[HGUHVXOWVDFURVVVHFWRUV0DMRU
VHFWRUVLQFOXGLQJSHWURFKHPLFDOVEDQNLQJDQGWHOHFRPFRPELQHGVKDUHRI
RI7$6,¶VIUHHIORDWZHLJKWHGPDUNHWFDSLWDOL]DWLRQZLWQHVVHGD
FRUUHFWLRQLQDIWHUWZRFRQVHFXWLYH\HDUVRIJDLQV+RZHYHUWKLVZDVRIIVHW
E\VLJQLILFDQWJURZWKLQUHWDLORIIUHHIORDWDQGFHPHQWRIIUHHIORDW
%RWKVHFWRUVDUHKLJKO\GHIHQVLYHDQGODUJHO\IRFXVHGRQGHPDQGIURPGRPHVWLF
FRQVXPHUV+HQFHWKH\ZHUHUHODWLYHO\UHVLOLHQWWRJOREDOHFRQRPLFLVVXHVDQG
EHQHILWHGIURPDQLQFUHDVHLQFRQVXPHUVSHQGLQJDQGVWURQJXQGHUO\LQJ
HFRQRPLFJURZWKLQ6DXGL$UDELD$KLJKGLYLGHQG\LHOGDOVRIXHOHGWKHUDOO\LQ
FHPHQWVWRFNV
Exhibit 19: TASI performance in 2011
8QLWVDVVWDWHG
Index
value
Index
7$6,
%DQNLQJ)LQDQFLDO
3HWURFKHPLFDOV
&HPHQW
7HOHFRP,7
$JUL)RRG
5HDO(VWDWH
,QGXVWULDO,QY
5HWDLO
&RQVWUXFWLRQ
,QVXUDQFH
(QHUJ\8WLOLWLHV
0XOWLLQYHVWPHQW
7UDQVSRUW
0HGLD3XEOLVKLQJ
+RWHOV7RXULVP
No. of
companies
Daily turnover
(SR mn)
Mkt cap
(SR mn)
Free float
Wt (%)
Change
YTD (%)
Valuation
P/BV
P/E TTM
6RXUFH=DZ\D5HXWHUV1&%&5HVHDUFK
3ULFHVDVRI'HF
,Q<7'WKHPDUNHWUHDFKHGDKLJKRIXSLQHDUO\$SULODOWKRXJKVLQFH
WKLVGDWHLWKDVEHHQXQGHUSUHVVXUHDQGLVFXUUHQWO\XSDURXQG7KHVWURQJ
VWDUWWR4KDVEHHQDFURVVWKHERDUGEXWDPRQJVWWKHODUJHFDSVHFWRUVLW
KDVEHHQOHGE\EDQNVDQGWHOHFRPV0DQ\RIWKHVSHFXODWLYHVHFWRUVDQG
FRPSDQLHVDOVRSHUIRUPHGYHU\VWURQJO\LQ4DSRWHQWLDOVLJQRIFRQFHUQ
Exhibit 20: 2011 sector performance
Exhibit 21: 2012 YTD sector performance
VHFWRUSHUIRUPDQFH
<7'VHFWRUSHUIRUPDQFH
7UDQVSRUW
5HDO(VWDWH
,QVX UDQFH
7HOHFRP,7
+RWHOV7RXULVP
0XOWLLQYHVWPHQW
,QGXVWU LDO,QY
0HGLD3XE OLVK LQJ
7$6,
%DQ NLQ J)LQDQ FLD O
5HWDLO
&HPHQW
$JU L)RRG
3HWURFKHPLFDOV
0HGLD
5HWDLO
&HPHQW
7RXULVP
0XOWLLQY
,QVX UDQFH
,QGXVWU LDO,QY
&RQVWUX FWLRQ
$JU L)RRG
(QH UJ\
&RQVWUX FWLRQ
7$6,
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
5HDO(VWDWH
7UDQVSRUW
%DQ NLQ J
7HOHFRP
3HWUR
(QH UJ\8WLOLWLH V
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
<7'WR$SULO
16
.6$672&.0$5.(7
1&%&$3,7$/
0$<
6DXGL$UDELD6WURQJHVWUHJLRQDOPDUNHW
,QWHUPVRIVHFWRUGLYHUVLW\PDUNHWFDSLWDOL]DWLRQPDUNHWWXUQRYHUDQGOLTXLGLW\
WKH6DXGLVWRFNPDUNHWLVWKHELJJHVWLQWKHUHJLRQ7KHPDUNHWLVPRVWO\GULYHQ
E\LQGLYLGXDOLQYHVWRUVZLWKUHWDLOLQYHVWRUVDFFRXQWLQJIRUDURXQGRIWKH
WXUQRYHULQ$SULO%\$SULOLQVWLWXWLRQDOWUDGLQJHLWKHUPXWXDOIXQGVRU
VZDSWUDGHVDFFRXQWHGIRURIWKHWRWDOWUDGLQJRQWKHPDUNHWDVRSSRVHGWR
D\HDUHDUOLHU+RZHYHUSRWHQWLDOSODQVWRSURYLGHJUHDWHUDFFHVVWR
TXDOLILHGIRUHLJQLQYHVWRUVDQGULVLQJOLTXLGLW\OHYHOVRIIHUVDWWUDFWLYHSURSRVLWLRQ
IRUJUHDWHUSDUWLFLSDWLRQRILQVWLWXWLRQDOLQYHVWRUV
.6$DFFRXQWVIRURI*&&PDUNHWFDSLWDOLVDWLRQDQG
RIWKHWXUQRYHU
,QWHUPVRIPDUNHWFDSLWDOL]DWLRQWKH6DXGLVWRFNPDUNHWLVWKHODUJHVWLQ*&&
ZLWKDVKDUHRIDERXWDWWKHHQGRI4,WZDVIROORZHGE\.XZDLWDQG
4DWDUDWDQGUHVSHFWLYHO\
Exhibit 22: GCC market capitalization: Saudi Arabia constitutes nearly 54% of the
region
,Q86'EQ
%DK UDLQ
2PDQ
4DWDU
.XZDLW
$EX 'KDE L
'XEDL
$SU -DQ
2FW
-XO
$SU -DQ
-XO
2FW
$SU -DQ
2FW
-XO
$SU -DQ
2FW
-XO
$SU -DQ
2FW
-XO
$SU -DQ
6DX GL
6RXUFH1&%&5HVHDUFK5HXWHUV
2YHUWKHSDVWIHZ\HDUVWKH.LQJGRPDFFRXQWHGIRUDURXQGRIWKHWRWDO
YDOXHWUDGHGLQ*&&+RZHYHU<7'LWVVKDUHKDVLQFUHDVHGWRDURXQG
7KLVGLVFUHSDQF\LQ6DXGL$UDELD¶VVKDUHFRPSDUHGWRWKH*&&PD\EH
DVFULEHGWRWKHIDFWWKDWRWKHUUHJLRQDOPDUNHWVVXFKDV.XZDLWDUHVHHLQJ
KHDY\WUDGLQJLQVWRFNVWKDWWUDGHEHORZSDUYDOXH
Exhibit 23: GCC turnover: TASI comprises around 90% of the GCC turnover
RI*&&WXUQRYHU
4DWDU
%DK UDLQ
2PDQ
.XZDLW
$EX 'KDE L
'XEDL
0D\
-DQ
0DU
1RY
6HS -XO
0DU
0D\
-DQ
1RY
-XO
6HS 0D\
0DU
-DQ
1RY
6HS -XO
0D\
0DU
-DQ
1RY
6HS -XO
0D\
-DQ
0DU
6DX GL
6RXUFH1&%&5HVHDUFK5HXWHUV
17
.6$672&.0$5.(7
1&%&$3,7$/
0$<
+LJKHVWOLTXLGLW\DQGWXUQRYHU
)RUWKHDYHUDJHWXUQRYHUWRPDUNHWFDSLWDOL]DWLRQUDWLRIRUWKH6DXGL
PDUNHWZDVIURPLQ7KLVLVVWLOOVLJQLILFDQWO\KLJKHUWKDQRWKHU
*&&PDUNHWVZKHUHWKHUDWLRUDQJHVIURP%DKUDLQWR$EX'KDEL
GXULQJWKHVDPHSHULRG
Exhibit 24: Turnover to market capitalization ratio
<HDUO\PDUNHWWXUQRYHUPDUNHWFDSLWDOL]DWLRQLQ
Saudi
Kuwait
Abu Dhabi
Dubai
Qatar
Oman
Bahrain
6RXUFH1&%&5HVHDUFK5HXWHUV
1RPLQDOSULFHKLJKO\FRUUHODWHGWRSHUIRUPDQFHLQ
7KH7$6,KDVVHHQVKDUSJDLQV<7'LQ7KHLQGH[DGGHGLQ4
PRVWO\GULYHQE\VWRFNVZLWKORZQRPLQDOSULFHV$GGLWLRQDOO\ZHEHOLHYHPRVW
ODUJHFDSVWRFNVKDYHXQGHUSHUIRUPHGWKH7$6,GXULQJWKHVDPHSHULRG
$VSHURXUDQDO\VLVWKHUHH[LVWVDQLQYHUVHUHODWLRQVKLSEHWZHHQWKHQRPLQDO
VWRFNSULFHDQGVWRFNSHUIRUPDQFH<7'7KHUHIRUHVWRFNVZLWKQRPLQDOYDOXHV
XSWR65DUHWKHEHVWSHUIRUPHUV<7'LQXSRQDYHUDJHZKLOH
VWRFNVZLWKQRPLQDOYDOXHVDERYH65URVHRQO\RQDQDYHUDJHGXULQJWKH
VDPHSHULRG2QDQDYHUDJHVWRFNVZLWKDQRPLQDOSULFHDERYH65VKDUH
KDYHXQGHUSHUIRUPHGWKH7$6,RQ<7'EDVLVDQGYLFHYHUVD
:HEHOLHYHWKLVELDVWRZDUGVORZQRPLQDOVWRFNVLVOLNHO\WRH[LVWDVORQJDVWKH
FXUUHQWWUHQGRIKLJKORFDOUHWDLOLQYHVWRUSDUWLFLSDWLRQLQWKHVWRFNPDUNHW
SUHYDLOV
Exhibit 25: % of total turnover
Exhibit 26: YTD % performance relative to the TASI
RIWXUQRYHU/+6QXPEHURIVWRFNV
<7'VHFWRUSHUIRUPDQFH
65
65
65
RI7XUQRYHU<7'
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
65
65
65
65
65
65
$YJ<7'SHUIRUPDQFH
65
65
65
7$6,<7'
RI6WRFNV
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
<7'WR0DUFK
18
.6$672&.0$5.(7
1&%&$3,7$/
0$<
&RQWLQXHGVWURQJHDUQLQJVJURZWKLQ(
6WURQJHDUQLQJVJURZWKLQ
,QHDUQLQJVIRUWKHHQWLUH6DXGLPDUNHWJUHZE\<R<WR65EQ
0DUNHWQHWLQFRPHJURZWKZDVPDLQO\GXHWRWKHJURZWKLQ3HWURFKHPLFDOV
HDUQLQJVGULYHQE\DUHERXQGLQSULFHVDVZHOODVQHZSURGXFWLRQFRPLQJRQ
VWUHDP%DQNV¶HDUQLQJVZHUHJRRGZLWKDJURZWKGXHODUJHO\WRORZHU<R<
SURYLVLRQLQJ(DUQLQJVLQWKHWHOHFRPVHFWRUZHUHIODWPRVWO\GXHWR);ORVVHVLQ
4IURP67&DQGFRQWLQXHGORVVHVDW=DLQ.6$&HPHQWQHWLQFRPH
LQFUHDVHGE\<R<GXHWRVWURQJGHPDQGDQGSULFHV
(FRXOGFRQWLQXHWRVHHHDUQLQJVJURZWK
0RVWRIWKHPDMRUVHFWRUVVKRXOGVHHFRQWLQXHGHDUQLQJVH[SDQVLRQLQ(
7KH3HWURFKHPLFDOVVHFWRULVH[SHFWHGWRVHHJURZWKRILQQHWLQFRPH
GHVSLWHDZHDNHUGHPDQGDQGSULFHRXWORRN:HEHOLHYHWKHSUHYDLOLQJFRVW
DGYDQWDJHSUR[LPLW\WR$VLDQPDUNHWVDQGWKHIXOO\HDUFRQWULEXWLRQIURP6DXGL
.D\DQDQG6DKDUD¶V$O:DKDSODQWVDUHNH\SRVLWLYHVIRUWKHVHFWRULQ7KH
%DQNLQJVHFWRUPD\FRQWLQXHWRZLWQHVVDJURZWKLQHDUQLQJVGXHWRGHFUHDVLQJ
SURYLVLRQVDQGDQLQFUHDVHLQQRQLQWHUHVWLQFRPH±ZHH[SHFWQHWLQFRPH
JURZWKRI 7KH5HWDLOVHFWRUZLOOEHQHILWIURPRQJRLQJVWRUHH[SDQVLRQVDQG
ILVFDOVXSSRUWSDFNDJHV±WKLVVKRXOGOHDGWRDLQFUHDVHLQQHWLQFRPH
Exhibit 27: Aggregate market earnings ± 2012E could grow further
,Q65EQ
$
%DQNV
3HWURFKHPV
$
7HOHFRPV
$
8WLOLWLHV
(
&HPHQW
2WKHU
6RXUFH1&%&5HVHDUFK5HXWHUV
Petrochemicals a key contributor again
$VZDVWKHFDVHLQDQGWKH3HWURFKHPLFDOVHFWRUZLOOOLNHO\EHWKH
PDLQGULYHURIHDUQLQJVJURZWKIRUWKHPDUNHW7KH3HWURFKHPLFDOVVHFWRULV
H[SHFWHGWRVHHJURZWKRILQQHWLQFRPHGHVSLWHDZHDNHUGHPDQGDQG
SULFHRXWORRN:HEHOLHYHWKHSUHYDLOLQJFRVWDGYDQWDJHSUR[LPLW\WR$VLDQ
PDUNHWVDQGWKHIXOO\HDUFRQWULEXWLRQIURP6DXGL.D\DQDQG6DKDUD¶V$O:DKD
SODQWVDUHNH\SRVLWLYHVIRUWKHVHFWRULQ
Progress in Banking sector profitability key
7KH%DQNVVHFWRUOLVWHGEDQNVKDVEHHQRQDGHFOLQLQJHDUQLQJVWUHQGIRUWKH
SDVWIRXU\HDUVDIWHUVHFWRUHDUQLQJVSHDNHGLQ6LQFHWKHQGHFOLQLQJ
EURNHUDJHLQFRPHDQGULVLQJLPSDLUPHQWVIRULQYHVWPHQWVDQGFUHGLWSURYLVLRQV
KDYHUHVXOWHGLQZHDNHUQHWLQFRPHIURP7RWDOGHSRVLWVDUH
H[SHFWHGWRJURZDWD&$*5RI(6HFWRUORDQJURZWKLV
H[SHFWHGWRJURZDWD&$*5RIWKURXJK(GULYHQE\LPSURYHG
HFRQRPLFDFWLYLW\DQGFRUSRUDWHVHFWRUOHQGLQJ:HH[SHFWJRYHUQPHQWIXQGLQJ
WRWKHSULYDWHVHFWRURIDSSUR[LPDWHO\65EQWRFRPSOHPHQWUDWKHUWKDQFURZG
RXWEDQNOHQGLQJ*URZWKLQVKRUWWHUPORDQVZKLFKDFFRXQWIRULQ
19
.6$672&.0$5.(7
1&%&$3,7$/
0$<
FRUSRUDWHORDQVLVH[SHFWHGWRFRPHZLWKLQFUHDVHGHFRQRPLFDFWLYLW\DQGORQJ
WHUPORDQVWREHGULYHQE\LQFUHDVHGH[SHQGLWXUHRQLQIUDVWUXFWXUHSURMHFWV
Exhibit 28: Loan to total deposits of KSA banks
,Q65PQXQOHVVRWKHUZLVHVWDWHG
5,% /
%-$=
6,%&
6DX GL
+ROODQG L
6DX GL
)UDQVL
$
6$% %
)
$UD E
1DWLRQDO
6$0%$
$O5DMKL
$/%LOD G
)
6RXUFH1&%&5HVHDUFK5HXWHUV1%7KHDERYHHVWLPDWHVDUHQRWLQFOXVLYHRIWKHDFWXDOUHSRUWHG4QXPEHUV
7$6,WUDGLQJEHORZLWV[KLVWRULFDODYHUDJH
2QDYDOXDWLRQEDVLVWKH7$6,UHPDLQVDWWUDFWLYHDQGLVFXUUHQWO\WUDGLQJDW
DURXQG[WUDLOLQJ3(DJDLQVWLWVKLVWRULFWKUHH\HDUDYHUDJHRI[DQGILYH
\HDUDYHUDJHRIRYHU[
Exhibit 29: TASI at 15.2x is below its historical 17.5x PE multiple
7$6,LQGH[OHYHOV/+63ULFHWR(DUQLQJVPXOWLSOHV5+6
7$6,/ +6 $SU -DQ
)HE
1RY
'HF
2FW
-XO
$XJ -XQ
$SU 7703( 5+6
0D\
)HE
2FW
-DQ
$SU 2FW
$SU 1RY
1RY
0D\
0D\
-XQ
'HF
-XQ
'HF
-DQ
$YHUDJ H3 (5+6
6RXUFH1&%&5HVHDUFK%ORRPEHUJ
7KH7$6,SRVLWLRQHGWRJURZLQWKHVKRUWPHGLXPWHUP
:HEHOLHYHWKH6DXGLPDUNHWLVZHOOSRVLWLRQHGWRJURZERWKLQWKHVKRUWDQG
PHGLXPWRORQJWHUP7KH7$6,LVFXUUHQWO\WUDGLQJDW[WUDLOLQJ3(EHORZ
LWVKLVWRULFDYHUDJHRI[DQGWKH[DQGDERYHYDOXDWLRQIRUVLPLODUIURQWLHU
DQGHPHUJLQJPDUNHWV7KLVFRPSHOOLQJYDOXDWLRQFRXSOHGZLWKWKHJRRGSURILW
JURZWKH[SHFWDWLRQVIRUWKHPDUNHWDQGOLPLWHGFRUUHODWLRQZLWKRWKHU
³PDLQVWUHDP´HPHUJLQJPDUNHWHFRQRPLHVZHEHOLHYHOHDGVWRDFRPSHOOLQJ
LQYHVWPHQWFDVHIRUWKH7$6,
+RZHYHUZHQRWHWKDWWKHFRQWLQXHGJOREDOXQFHUWDLQW\SRVHVDULVNWRWKH6DXGL
$UDELDQHFRQRP\:KLOHSURJUHVVKDVEHHQPDGHWRZDUGVUHVROYLQJWKH
(XUR]RQHGHEWFULVLVDSHUPDQHQWVROXWLRQVWLOOUHPDLQVHOXVLYH6LPLODUO\
JURZWKFRQFHUQVLQWKH86DQGHPHUJLQJHFRQRPLHVFRQWLQXHWRZHLJKRQJOREDO
VHQWLPHQW$OOWKHVHIDFWRUVKDYHDSRWHQWLDOWRGHUDLO6DXGL$UDELD¶VJURZWK
PRPHQWXPZLWKORZHURLOSULFHVWKHNH\LQLWLDOWULJJHU
6HFWRUYDOXDWLRQVUDQJHIURP[±[
2QDVHFWRUOHYHO3(UDQJHVIURP[IRUWKHWHOHFRPVHFWRUWR[IRUWKH
PXOWLLQYHVWPHQWVHFWRU0RVWRIWKHPDMRUVHFWRUVFXUUHQWO\WUDGHDWEHORZWKHLU
20
.6$672&.0$5.(7
1&%&$3,7$/
0$<
KLVWRULFDODYHUDJH3(OHYHOVJLYHQWKHJRRGJURZWKRXWORRNIRUHDUQLQJVZH
EHOLHYHWKLVLQGLFDWHVDJRRGHQWU\SRLQWIRUPDQ\RIWKHVHVHFWRUV$GGLWLRQDOO\
ZHQRWHWKHIROORZLQJ
x 7KH3HWURFKHPLFDOVHFWRULVWUDGLQJDWD3(RI[YHUVXVLWVKLVWRULFDO
DYHUDJHRI[:LWKRXUH[SHFWDWLRQVRIHDUQLQJVJURZWKIRUWKHVHFWRU
ZHEHOLHYHWKLVZLOOEHRQHRIWKHVWURQJHUSHUIRUPHUVDJDLQLQ(KHOSLQJ
WRGULYHWKHHQWLUHPDUNHWWRVWURQJUHWXUQV
x %DQNLQJILQDQFLDOVLVWUDGLQJDWD3(RI[EHORZLWVKLVWRULFDODYHUDJHRI
[:HEHOLHYHWKH%DQNLQJVHFWRUZLOOFRQWLQXHWRZLWQHVVDJURZWKLQ
HDUQLQJVGXHWRGHFUHDVLQJSURYLVLRQVDQGDQLQFUHDVHLQQRQLQWHUHVW
LQFRPH±ZHH[SHFWQHWLQFRPHJURZWKRILQ
x 7HOHFRP,7LVWUDGLQJDWD3(RI[:HPDLQWDLQDQRYHUZHLJKWUDWLQJRQ
WZRRIWKHWKUHHPDLQVWRFNVLQWKHVHFWRU0RELO\DQG6DXGL7HOHFRP
&RPSDQ\
x 7KHUHWDLOVHFWRULVWUDGLQJDWD3(RI[EHORZLWVKLVWRULFDODYHUDJH
Exhibit 30: Sector P/Es versus historical P/Es
3ULFHWR(DUQLQJVPXOWLSOHV
7703(
0HGLD
&HPHQW
5HWDLO
7RXULVP
0XOWLLQY
,QVX UDQFH
,QGXVWU LDO,QY
$JU L)RRG
(QH UJ\
&RQVWUX FWLRQ
5HDO(VWDWH
7$6,
3HWUR
7UDQVSRUW
%DQ NLQ J
7HOHFRP
$YHUDJH3(
6RXUFH1&%&5HVHDUFK5HXWHUV
$YHUDJH3(IRUWKH,QVXUDQFHVHFWRULVQRWPHDQLQJIXO
0DUNHWVXSSRUWHGE\VWURQJGLYLGHQG\LHOGV
6WURQJGLYLGHQG\LHOGVIRUPRVWVWRFNVLQ(DGGWRRXUSRVLWLYHRXWORRNIRU
WKH6DXGLPDUNHW$PRQJWKHVWRFNVXQGHURXUFRYHUDJHWKHWRSGLYLGHQG
\LHOGLQJFRPSDQLHVKDYH(\LHOGVUDQJLQJIURP±6L[RIWKHWRSWHQ
VWRFNVDUHFHPHQWFRPSDQLHVZLWKDVWDEOHGLYLGHQGRXWORRNGXHWRWKHLUVWURQJ
FDVKIORZV7KHUHPDLQLQJIRXUVWRFNVEHVLGHVRIIHULQJOXFUDWLYH\LHOGVDUHIDLUO\
DWWUDFWLYHIURPDYDOXDWLRQSHUVSHFWLYHZLWKLQWKHLUUHVSHFWLYHVHFWRUVWHOHFRP
EDQNLQJDQGSHWURFKHPLFDOVWKXVSURYLGLQJSRWHQWLDOXSVLGHIURPWKHFXUUHQW
SULFHOHYHOV
Exhibit 31: Dividend yields expected for 2012E
0RELO\
67&
6LSFKH P 5L\D G% DQN
(DVWHUQ
&HPHQW
4DVVLP
&HPHQW
6$)&2
6RX WKH UQ
&HPHQW
6DX GL
&HPHQW
<DPDPDK
&HPHQW
6RXUFH1&%&5HVHDUFK5HXWHUV
21
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Industries & Companies
Sector
Page No.
Banking & Financials
24
Petrochemicals
40
Cement
59
Retail
75
Energy & Utilities
88
Agriculture & Food
93
Telecom
110
Insurance
120
Multi Investment
155
Industrial Investment
165
Building & Construction
182
Real Estate
201
Transport
212
Media & Publishing
219
Hotels & Tourism
225
Please note that our estimates for the companies under coverage have not
been updated post the 1Q12 results
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Banking & Financials
Ticker
Company
Page No.
1120
Al Rajhi
28
1090
SAMBA
29
1050
Banque Saudi Fransi
30
1010
RIBL
31
1060
SABB
32
1040
Saudi Hollandi
33
1080
Arab National
34
1030
Saudi Investment
35
1140
Al Bilad
36
1020
BJAZ
37
1150
Al Inma Bank
38
0$<
%$1.,1*
H[SHFWHGWRUHFRUGFRQWLQXHGJURZWK
7KH6DXGLEDQNLQJVHFWRUKDVUHPDLQHGRQHRIWKHVWURQJHVWLQ
WHUPVRISURILWDELOLW\DVVHWTXDOLW\DQGFDSLWDODGHTXDF\LQWKH
*&&,WVVWURQJIXQGDPHQWDOVDQGXQGHUSHQHWUDWHGPDUNHWRIIHUV
VLJQLILFDQWJURZWKSRWHQWLDO
:HDUHFRQILGHQWRIWKHVHFWRU¶VDELOLW\WRLPSURYHHDUQLQJVLQWKHPHGLXPWHUP
:HH[SHFWWKHJURZWKLQFUHGLWWRFRQWLQXHLQDVEDQNVIRFXVRQUHWDLO
OHQGLQJ,QORDQERRNVJUHZ<R<WR65EQZKLOHFXVWRPHU
GHSRVLWVLQFUHDVHG<R<WR65EQ7RWDOEDQNLQJDVVHWVRIWKH
PDLQGRPHVWLFEDQNVJUHZ<R<WR65EQ+RZHYHUFRQWUDFWLRQLQ
1,0VUHVXOWHGLQRQO\<R<JURZWKLQ16&,1RQHWKHOHVVVWURQJJURZWKLQ
QRQLQWHUHVWLQFRPHNHSWWRWDORSHUDWLQJLQFRPHJURZWKDWUHDVRQDEOHOHYHOVRI
<R<)XUWKHUPRUHGHFOLQHLQSURYLVLRQVE\HQDEOHGERWWRPOLQH
JURZWKRI<R<
'XHWRWKHUHWDLOIRFXVRIPDQ\EDQNVEUDQFKQHWZRUNDQGWKHQXPEHURI$70V
LQFUHDVHGE\DQGUHVSHFWLYHO\GXULQJ:LWKWKHDGGLWLRQRIWZRQHZ
IRUHLJQEDQNEUDQFKHVWKHQXPEHURIIRUHLJQEDQNVRSHUDWLQJLQFUHDVHGWR
DORQJZLWKGRPHVWLFEDQNV
Exhibit 32: Key financials of Saudi banks (2011) ± SR million; network of branches and ATMs
x
Established as Saudi
Banks
GCC Banks
Non- GCC
Foreign Banks
JV with
foreign
partners
Domestic Banks
Banks
7KH1DWLRQDO&RPPHUFLDO%DQN
$O5DMKL%DQN
6DPED)LQDQFLDO*URXS
5L\DG%DQN
7KH6DXGL,QYHVWPHQW%DQN
%DQN$OMD]LUD
$OLQPD%DQN
%DQN$OELODG
%DQTXH6DXGL)UDQVL
6$%%
$UDE1DWLRQDO%DQN
6DXGL+ROODQGL%DQN
(PLUDWHV1%'%DQN
%DQN0XVFDW
1DWLRQDO%DQNRI%DKUDLQ
1DWLRQDO%DQNRI.XZDLW
*XOI,QWHUQDWLRQDO%DQN
'HXWVFKH%DQN
%133DULEDV
-30RUJDQ&KDVH1$
1DWLRQDO%DQNRI3DNLVWDQ
6WDWHEDQNRI,QGLD
7&=LUDDW%DQNDVL$6
Total
Branches
1,646
ATMs
11,766
Assets
1,505,288
Loans &
advances
Customer
deposits
855,330
1,147,133
Net profits
31,616
6RXUFH6$0$7DGDZXO&RPSDQ\GDWD1&%&5HVHDUFK
1RWH)LQDQFLDOVWDWHPHQWVRIWKHEDQNVDUHFRQVROLGDWHGDQGLQFOXGHILQDQFLDOVWDWHPHQWVRILWVVXEVLGLDULHVLQFOXGLQJWKRVHORFDWHGRXWVLGH.6$
)LYHLQWHUQDWLRQDOEDQNVQDPHO\*XOI,QWHUQDWLRQDO%DQN'HXWVFKH%DQN%133DULEDV-30RUJDQ&KDVHDQG1DWLRQDO%DQNRI3DNLVWDQRSHUDWH$70VDFURVV.6$
24
%$1.,1*
1&%&$3,7$/
0$<
7KH6DXGLEDQNLQJVHFWRUFRPSDUHGWRWKH*&&
&RQVLGHULQJRQO\OLVWHGEDQNVLQRXUDQDO\VLVWKH6DXGLEDQNLQJVHFWRUVWRRG
VHFRQGLQWHUPVRIWRWDORSHUDWLQJLQFRPHDIWHU8$(GXULQJ+RZHYHU
6DXGLEDQNVJHQHUDWHKLJKHU5HWXUQRQ(TXLW\RIDVFRPSDUHGWR8$(
%DQN¶V52(RI6DXGLEDQN¶VVWURQJIXQGDPHQWDOVDQGKLJKHUUHWXUQV
MXVWLI\LWVSUHPLXPYDOXDWLRQRYHU8$(6DXGLEDQNVWUDGHVDWDKLJKHU3(RI
[FRPSDUHGWRWKH8$(EDQNV3(RI[
Exhibit 33: Total operating income of GCC banks, 2009±
11
Exhibit 34: Comparison of RoE and P/E of GCC banks,
2011
86'PQ
5R(
3(
.6$
8$(
.XZDLW
4DWDU
2PDQ
%DK UDLQ
6RXUFH5HXWHUV1&%&5HVHDUFK7KHFRPSDQLHVOLVWLVQRWH[KDXVWLYH
.6$
8$(
.XZDLW
4DWDU
2PDQ
%DK UDLQ
6RXUFH5HXWHUV1&%&5HVHDUFK6L]HRIWKHEXEEOHUHSUHVHQWVPDUNHWFDSDVRQ
0DUFKLQ86'PQ
$VRI0DUFK$O5DMKLKDGWKHODUJHVWPDUNHWFDSLWDOL]DWLRQDPRQJWKH
OLVWHGEDQNVWKDWFRQVWLWXWHWKH6DXGLEDQNLQJLQGH[1&%RQHRIWKHODUJHVW
EDQNVLQ.6$LVQRWPHQWLRQHGLQWKHWDEOHDVLWLVDSULYDWHO\KHOGHQWLW\
Exhibit 35: Sector details
8QLWVDVVWDWHG
% weight in
Index as on
28 Mar 2012
$O5DMKL%DQN$O5DMKL
6DPED)LQDQFLDO*URXS6$0%$
%DQTXH6DXGL)UDQVL6DXGL)UDQVL
5L\DG%DQN5,%/
$OLQPD%DQN$OLQPD
$UDE1DWLRQDO%DQN$UDE1DWLRQDO
7KH6DXGL%ULWLVK%DQN6$%%
%DQN$O%LODG$O%LODG
7KH6DXGL,QYHVWPHQW%DQN6$,%
%DQN$O-D]LUD%-$=
6DXGL+ROODQGL%DQN6DXGL+ROODQGL
NIM (%),
2011
Avg. RoE (%),
2011
6RXUFH%ORRPEHUJ7DGDZXO&RPSDQ\GDWD
1,0VWDQGVIRU1HW,QWHUHVW0DUJLQV
([KLELWVEHORZGHSLFWWKHSHUIRUPDQFHRI6DXGLEDQNVLQWHUPVRIQHWLQWHUHVW
LQFRPHDQGQHWLQWHUHVWPDUJLQGXULQJ±,QQHWLQWHUHVWLQFRPH
LQFUHDVHG<R<DJDLQVW<R<GHFOLQHLQZKLOHQHWLQWHUHVW
PDUJLQVFRQWUDFWHGESVRYHU7KLVZDVPDLQO\GXHWRIDVWHUJURZWKLQ
ORDQVLQWKHORZLQWHUHVWUDWHHQYLURQPHQW$OLQPDDQG$OELODG¶VQHWLQWHUHVW
LQFRPHJUHZUDSLGO\E\DQG<R<UHVSHFWLYHO\ODUJHO\GXHWRORDQ
ERRNH[SDQVLRQ$PRQJODUJHUEDQNV5,%/¶VQHWLQWHUHVWLQFRPHJUHZ
<R<ZKLOH6DPEDDQG$O5DMKLUHSRUWHGD<R<GHFOLQHRIDQG
UHVSHFWLYHO\
25
%$1.,1*
1&%&$3,7$/
0$<
Exhibit 36: Net Interest Income of Banks, 2009±11
Exhibit 37: Net Interest Margin (%) of Banks, 2009±11
65PQ
6$% %
6DX GL+ROO DQGL
$OLQ PD
%-$=
$/%LOD G
6,%&
%-$=
6$% %
6$0%$
5,% /
6,%&
6RXUFH7DGDZXO1&%&5HVHDUFK
6DX GL+ROO DQGL
6DX GL)UDQ VL
6DX GL)UDQ VL
$UD E1DWLRQDO
$UD E1DWLRQDO
5,% /
6$0%$
$/%LOD G
$O5DMKL
$OLQ PD
$O5DMKL
6RXUFH7DGDZXO1&%&5HVHDUFK
7KH52(IRUPRVWEDQNVLQFUHDVHGLQZLWKDQH[FHSWLRQRI%DQTXH6DXGL
)UDQVLDQG6DPED2QWKH3%PXOWLSOHIURQW$O5DMKLFRQWLQXHGWRGRPLQDWH
IROORZHGE\6$%%ZKLOH5,%/DQG6,%&UHSRUWHGWKHORZHVWILJXUH
Exhibit 38: Comparison of P/B and RoE, 2010
Exhibit 39: Comparison of P/B and RoE, 2011
6$0%$
$O5DMKL
6DXGL+ROODQGL
6$%%
$UDE1DWLRQDO
5,%/
6DXGL)UDQVL
5,%/
$UDE1DWLRQDO
6,%&
%-$=
$OLQPD
3%
%-$=
$O5DMKL
6$%%
6DXGL+ROODQGL
6,%&
$OLQPD
6$0%$
6DXGL)UDQVL
5R(
5R(
3%
6RXUFH7DGDZXO1&%&5HVHDUFK6L]HRIWKHEXEEOHUHSUHVHQWV0FDSDVRQ0DUFK
LQ86'PQ
6RXUFH7DGDZXO1&%&5HVHDUFK6L]HRIWKHEXEEOHUHSUHVHQWV0FDSDVRQ0DUFK
LQ86'PQ
$IWHUUHPDLQLQJVWHDG\IRUWKUHHTXDUWHUVLQWHUHVWUDWHVLQ.6$LQFUHDVHG
PDUJLQDOO\LQ4LQOLQHZLWK/,%257KHJRYHUQPHQWPDLQWDLQHGWKHUHSRUDWH
DQGUHYHUVHUHSRUDWHDWDQGUHVSHFWLYHO\GXULQJWKH\HDU:H
H[SHFW6$,%25WRUHPDLQDWORZOHYHOVXQWLOSRVWZKHQZHEHOLHYHWKH)HG
ZLOOVWDUWLQFUHDVLQJLWVEHQFKPDUNUDWH
Exhibit 40: Movement in Interbank Interest Rates
Exhibit 41: Movement in Repo & Reverse Repo rates
-DQ
-DQ
$XJ 0DU
2FW
0D\
6SU HDGVE SV5+6
6RXUFH%ORRPEHUJ5HXWHUV1&%&5HVHDUFK
'HF
6$,%2 5
-XO
)HE
/,%25
-XO
-DQ
-XO
5HSRUDWH
-DQ
-XO
5HYHUVH5HSR UD WH
-DQ
-XO
-DQ
,QIOD WLR Q
6RXUFH6$0$1&%&5HVHDUFK
26
BANKING
NCB CAPITAL
MAY 2012
NCBC recommendations in the sector
The year 2011 witnessed strong growth in loans and improved asset quality.
However, contraction in NIMs due to lower interest rates and increased
competition kept NSCI growth muted. Nonetheless, increased non-interest
income and reduced provisions improved the bottom-line. We expect loan
growth to continue and NIMs to compress, however, the increase in loan volume
is expected to aid NSCI growth. In addition, high trading volumes on the
Tadawul will enable banks to grow its brokerage income particularly for the
smaller banks. Strong fundamentals and improved asset quality of Saudi banks
keep our view positive on the sector.
Exhibit 42: Coverage stocks details
Stock
Current Rating
Al Rajhi
(1120. SE)
Overweight
PT (SR)
Comments
90.2
Al Rajhi¶VORDQERRNLVOikely to grow faster than industry peers benefitting from its large
deposit base. Although the EDQN¶VPDUJLQVDUHFRQWUDFWLQJGXHWRcurrent low interest
rates, the bank will benefit from its lower cost of funds in the long run which will support
NSCI.
Arab National Neutral
(1080.SE)
32.9
:HEHOLHYH$1%¶VORZHUORDQJURZWKDQGFRPSUHVVHGPDUJLns is likely to keep its total
operating income growth muted. However, its improved asset quality is a key positive
which is likely to offset the muted total operating income.
AlBilad
(1140. SE)
Neutral
21.4
$OELODG¶VUHWDLOIRFXVZRXOGHQDEOHDIDVWHUgrowth in its net loans and increase its NSCI
for 2012. In addition, strong non-interest income and improved asset quality is likely to
add to bottom-line. However, operating costs remains a concern for its profitability.
BJAZ
(1020. SE)
Neutral
19.6
Saudi
Fransi
(1050. SE)
Overweight
38.3
%-$=¶VWRS-line is likely to benefit from both strong loan growth and fee income aided
by strong brokerage revenue from increasing trading volumes on the Tadawul.
However, we believe the potential gains from the surge in market activity have been
priced-in.
.
BSF's retail focus is likely to grow its loan books as well as maintain NIMs. This will
keep its NSCI strong. Although the retail focus will increase operating costs, we believe
strong top-line growth and better asset quality will offset the impact of that on the
bottom-line.
Riyad Bank
(1010. SE)
Overweight
33.2
5,%/¶Vstrong corporate and retail presence is likely to benefit the bank to expand its
credit portfolio and improving its asset quality. ,QDGGLWLRQWKHEDQN¶VDLPWRPDLQWDLQ
margins is likely to enable the bank to post double digit net earnings growth from 2013.
SABB
(1060. SE)
Overweight
40.5
:HH[SHFW6$%%¶VWRWDORSHUDWLQJLQFRPHLQWREHGULYHQE\loan volumes and
strong fee income. In addition, stable operating expenses and lower provision charges
will enable it to marginal growth in net income.
SAIB
(1030. SE)
Neutral
18.2
6$,%¶VGLYHUVLILFDWLRQVWUDWHJ\WRJURZUHWDLOORDQVwill benefit the bank in long term.
However, stiff competition from established players may pressurize its net interest
margins in the near term..
Samba
(1090.SE)
Overweight
60.6
7KHEDQN¶VDELOLW\WRSRVWUHODWLYHO\VWURQJSURILWDELOLW\GHVSLWHKDYLQJDFRQVHUYDWLYH
approach keeps us positive on the stock. As the high-yielding corporate bonds mature,
Samba will refocus on expanding its loan book and therefore maintain profitability.
Saudi
Hollandi
(1040.SE)
Overweight
32.2
SHB is likely to grow its loan books benefitting from its microfinance initiative. This is
also likely to improve its bottom-line. However, we are concerned about SHB¶VUHOLDQFH
on Tier II subordinated debt for capital adequacy. Considering stringent laws of Basel
III, the bank might need to increase its equity which would limit future dividend payouts.
Source: NCBC Research
27
%$1.,1*~0$<
$/5$-+,%$1.
$/62.12:1$6$/5$-+,
FXVWR
$O5DMKL%DQN$O5DMKLWKHVHFRQGODUJHVWEDQNLQ.6$LQ
WHUPVRIWRWDODVVHWVZDVHVWDEOLVKHGLQ%HLQJDIXOO
IOHGJHG,VODPLFEDQN$O5DMKLRIIHUV6KDULD¶DFRPSOLDQW
EDQNLQJDQGLQYHVWPHQWSURGXFWVWRLWVFXVWRPHUVWKURXJKD
QHWZRUNRIEUDQFKHVDQG$70V7KHEDQNRSHUDWHV
LQ0DOD\VLD.XZDLWDQG-RUGDQWKURXJKIXOO\RZQHG
VXEVLGLDULHVDQGKDVRIILFHVLQWKH8.%ULWLVK9LUJLQ,VODQGV
DQG-HUVH\
x %XVLQHVVEULHI
29(5:(,*+7
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
$O5DMKLRIIHUV6KDULD¶DFRPSOLDQWUHWDLODVZHOODVFRUSRUDWHEDQNLQJDQG
WUHDVXU\VHUYLFHVWRLWVFXVWRPHUV$O5DMKL&DSLWDOWKHEDQN¶VVXEVLGLDU\
PDQDJHVLQYHVWPHQWEDQNLQJDVVHWPDQDJHPHQWDQGEURNHUDJH
EXVLQHVVHV'XULQJWKHEDQNHVWDEOLVKHG$O5DMKL%DQN±-RUGDQ
VWDNHDQG$O5DMKL7DNDIXO$JHQF\&RPSDQ\
x )LQDQFLDOV
$O5DMKL¶VQHWLQFRPHJUHZWR<R<65EQLQ1HWVSHFLDO
FRPPLVVLRQLQFRPHGHFOLQHG<R<GHVSLWHDJURZWKLQORDQ
ERRNV7KLVLVPDLQO\GXHWRFRQWUDFWLRQLQ1,0VDVLQWHUHVWUDWHVUHPDLQHG
ORZ+RZHYHUQRQVSHFLDOFRPPLVVLRQLQFRPHJUHZ<R<OHDGLQJWRD
LQFUHDVHLQWRWDORSHUDWLQJLQFRPH7KHEDQN¶VSURYLVLRQVGHFOLQHG
<R<GXHWRLPSURYHGDVVHWTXDOLW\+RZHYHURWKHURSHUDWLQJ
H[SHQVHVJUHZSXVKLQJWKHFRVWWRLQFRPHUDWLRWRIURP
'XULQJWKH\HDU$O5DMKL¶VFXVWRPHUGHSRVLWVJUHZDVDUHVXOWWKH
/7'UDWLRIHOOWRIURPLQ
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
5-+,$%
ZZZDOUDMKLEDQNFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
x 5HFHQWGHYHORSPHQWV
9$/8$7,2108/7,3/(6
,Q0DUFK$EGXOODKELQ6XODLPDQ$O5DMKLUHVLJQHGDV&(2DQG0'EXW
ZRXOGFRQWLQXHWREHLQWKH%R'6XOLPDQELQ$EGXO$]L]$]]DELQZDV
DSSRLQWHGWKHQHZ&(2ZLWKHIIHFWIURP$SULO,Q-DQXDU\$O
5DMKLDQQRXQFHGGLYLGHQGVRI65EQIRUWKHVHFRQGKDOIRIILVFDO\HDU
,Q'HFHPEHU)LWFKDIILUPHG$O5DMKL%DQN¶VORQJWHUPLVVXHUGHIDXOW
UDWLQJ,'5DWµ$¶ZLWKDVWDEOHRXWORRN
$
3([
$
(
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW6S&RP,QFRPH
2SHUDWLQJ,QFRPH
1HW,QFRPH
$VVHWV
(TXLW\
/RDQV
7RWDO'HSRVLWV
1HW,QWHUHVW0DUJLQ
&RVW,QFRPH
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH&RPSDQ\1&%&5HVHDUFK
(
(
<R< &$*5
(
0D\
6HS
7$6,
-DQ
0D\
$O5DMKL5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
6XODLPDQ$EGXO$]L]6DOHK$O5DMKL 6DOHK$EGXO$]L]6DOHK$O5DMKL
*26,
$EGXOODK$EGXO$]L]6DOHK$O5DMKL
6RXUFH7DGDZXO1&%&5HVHDUFK
28
%$1.,1*~0$<
6$0%$),1$1&,$/*5283
$/62.12:1$66$0%$
6DPED)LQDQFLDO*URXS6DPEDWKHWKLUGODUJHVWEDQNLQ
6DXGL$UDELDLQWHUPVRIWRWDODVVHWVZDVLQFRUSRUDWHGLQ
WKURXJKWKHWDNHRYHURI&LWLJURXS¶VEUDQFKHVLQWKH
.LQJGRP6DPEDRSHUDWHVEUDQFKHVDQG$70V7KH
EDQNRSHUDWHVLQ3DNLVWDQWKURXJKLWVVXEVLGLDU\DQGKDV
EUDQFKHVLQWKH8.'XEDLDQG4DWDU
29(5:(,*+7
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
6DPED¶VFRUHEDQNLQJDFWLYLWLHVLQFOXGHFRUSRUDWHDQGUHWDLOEDQNLQJDQG
WUHDVXU\VHUYLFHV7KHEDQNDOVRRIIHUVWUDGHILQDQFH6KDULDKFRPSOLDQW
EDQNLQJDQGFRUSRUDWHLQYHVWPHQWVHUYLFHV6DPED&DSLWDO,QYHVWPHQW
0DQDJHPHQW&RWKHLQYHVWPHQWEDQNLQJGLYLVLRQKDQGOHVDVVHW
PDQDJHPHQWDQGEURNHUDJHVHUYLFHV6DPED5HDO(VWDWH&RDQRWKHU
VXEVLGLDU\RIWKHEDQNPDQDJHVUHDOHVWDWHSURMHFWVIRU6DPED5HDO(VWDWH
)XQG
x )LQDQFLDOV
6DPEDZDVWKHRQO\EDQNDPRQJVWLWV6DXGLSHHUVWKDWUHSRUWHGDGHFOLQHLQ
QHWLQFRPHLQ7KHEDQN¶VQHWVSHFLDOFRPPLVVLRQLQFRPHIHOO
<R<GXHWRDGHFOLQHLQLWV1,0VZKLFKRYHUVKDGRZHG<R<H[SDQVLRQ
LQORDQERRN,QDGGLWLRQWKHWUDGLQJORVVHVLQFXUUHGLQORZHUHGWKH
EDQN¶VQRQLQWHUHVWLQFRPHE\<R<UHVXOWLQJLQDGHFUHDVHLQ
WRWDORSHUDWLQJLQFRPH$OWKRXJKWKHEDQN¶VSURYLVLRQVRQFUHGLWORVVHV
GHFOLQHG<R<VXEGXHGWRSOLQHSHUIRUPDQFHUHVXOWHGLQD<R<
GURSLQQHWLQFRPHWR65EQIRU
x 5HFHQWGHYHORSPHQWV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
65
86
$YJGDLO\WXUQRYHUPQ
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6$0%$$%
ZZZVDPEDFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
,Q'HFHPEHU6DPEDDQQRXQFHGFDVKGLYLGHQGVRI65PQIRUWKH
+,Q1RYHPEHU6DPED&DSLWDOWKHLQYHVWPHQWDUPRI6DPED
ODXQFKHGWKHILUVW6KDULD¶DFRPSOLDQW86GROODUGHQRPLQDWHGIXQG$O1DIHHV
*OREDO&RPPRGLWLHV(TXLW\)XQG
9$/8$7,2108/7,3/(6
$
3([
3%[
36[
'LY<LHOG
'36
$
(
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW6S&RP,QFRPH
2SHUDWLQJ,QFRPH
1HW,QFRPH
$VVHWV
(TXLW\
$GYDQFHV
7RWDO'HSRVLWV
1HW,QWHUHVW0DUJLQ
&RVW,QFRPH
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
0D\
6HS
-DQ
7$6,
0D\
6$0%$5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
3XEOLF,QYVW)XQG
3XEOLF3HQVLRQ$XWKRULW\
*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
29
%$1.,1*~0$<
%$148(6$8',)5$16,
$/62.12:1$6%6)
%6)DQDIILOLDWHRI&UpGLW$JULFROH*URXSFRPPHQFHG
RSHUDWLRQVLQ'HFHPEHUE\WDNLQJRYHUWKHEUDQFKHVRI
%DQTXH,QGRVXH]7KHEDQNRIIHUVFRQYHQWLRQDODQG,VODPLF
EDQNLQJSURGXFWVWKURXJKDQHWZRUNRIEUDQFKHVDQG
$70VLQ6DXGL$UDELD
29(5:(,*+7
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
%6)¶VFRUHDFWLYLWLHVLQFOXGHUHWDLODQGFRUSRUDWHEDQNLQJDVZHOODVWUHDVXU\
VHUYLFHV7KHEDQN¶VLQYHVWPHQWEDQNLQJDFWLYLWLHVDUHFRQGXFWHGE\6DXGL
)UDQVL&DSLWDO7KHEDQNDOVRKDVDQLQVXUDQFH-9ZLWK$OOLDQ]*URXSXQGHU
WKHQDPH$OOLDQ]6DXGL)UDQVL&R)XUWKHUPRUHWKHEDQNKDV
VWDNHLQ6\ULDEDVHG%DQTXH%(026DXGL)UDQVL
x )LQDQFLDOV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
,Q%6)¶VQHWLQFRPHJUHZ<R<WR65EQ%6)¶VORDQVDQG
GHSRVLWVDQGUHVSHFWLYHO\+RZHYHUQHWVSHFLDOFRPPLVVLRQ
LQFRPHJUHZ<R<DVDUHVXOWRIORZHUQHWLQWHUHVWVSUHDGV%6)¶VQRQ
LQWHUHVWLQFRPHJUHZ<R<OHDGLQJWR<R<JURZWKLQWRWDORSHUDWLQJ
LQFRPH%6)¶VUHWDLOIRFXVLQFUHDVHGLWVRSHUDWLQJH[SHQVHVDVDUHVXOWLWV
FRVWWRLQFRPHUDWLRLQFUHDVHGWRIURP+RZHYHULPSURYHG
DVVHWTXDOLW\UHGXFHGSURYLVLRQVIRUFUHGLWORVVHVE\HQDEOLQJWKH
EDQNWRUHJLVWHUPRGHUDWHERWWRPOLQHJURZWK
x 5HFHQWGHYHORSPHQWV
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
%6)5$%
ZZZDOIUDQVLFRPVD
,Q)HEUXDU\WRJHWKHUZLWKDQXPEHURIEDQNV%6)VLJQHGD65EQ
V\QGLFDWHGORDQDJUHHPHQWIRU\HDUVZLWK0DUDILT&RPSDQ\WRILQDQFHWKH
H[SHQVHVRIWKHODWWHU¶VSURMHFWVDQGH[SDQVLRQRSHUDWLRQVLQ-XEDLODQG
<DQEX,Q-DQXDU\%6)DQQRXQFHGLWVSODQWRLQFUHDVHLWVSDLGXS
FDSLWDOWR65EQIURP65EQWKURXJKERQXVLVVXH7KHEDQN
ZRXOGRIIHURQHERQXVIRUHYHU\IRXUKHOG,Q1RYHPEHUWKHEDQN
DQQRXQFHGLWVSODQWRVHOOLWVVWDNHLQ%HPR6DXGL)UDQVL6\ULDDQG
VWDNHLQ%HPR/HEDQRQGXHWRWKHILQDQFLDOULVNLQYROYHGLQ6\ULD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
3([
$
(
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW6S&RP,QFRPH
2SHUDWLQJ,QFRPH
1HW,QFRPH
$VVHWV
(TXLW\
$GYDQFHV
7RWDO'HSRVLWV
1HW,QWHUHVW0DUJLQ
&RVW,QFRPH
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH&RPSDQ\1&%&5HVHDUFK
(
(
<R< &$*5
(
$SU
-XO
7$6,
1RY
0DU
6DXGL)UDQVL5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
*URXSH&UpGLW$JULFROH>&DO\RQ@
*26,
5DVKLG$O$EGXO5DKPDQ$O
5DVKLG6RQV
6RXUFH7DGDZXO1&%&5HVHDUFK
30
%$1.,1*~0$<
5,<$'%$1.
$/62.12:1$65,%/
5L\DG%DQN5,%/HVWDEOLVKHGLQ7KHEDQNKDV
EUDQFKHVDQG$70VLQ.6$DEUDQFKLQ/RQGRQDQ
DJHQF\LQ+RXVWRQDQGDUHSUHVHQWDWLYHRIILFHLQ6LQJDSRUH
x %XVLQHVVEULHI
29(5:(,*+7
&XUUHQWSULFH65 3ULFLQJDVRI
5,%/SHUIRUPVFRUHEDQNLQJDFWLYLWLHVWKURXJKIRXUGLYLVLRQV3HUVRQDO
%DQNLQJ&RUSRUDWH%DQNLQJ7UHDVXU\6HUYLFHVDQG,QWHUQDWLRQDO%DQNLQJ
7KHEDQNRIIHUVDUDQJHRIFRQYHQWLRQDODQG6KDULD¶DFRPSOLDQWEDQNLQJ
SURGXFWV5,%/SURYLGHVDVVHWDQGZHDOWKPDQDJHPHQWFRUSRUDWHILQDQFH
DQGEURNHUDJHVHUYLFHVWKURXJKLWVZKROO\RZQHGLQYHVWPHQWEDQNLQJ
VXEVLGLDU\5L\DG&DSLWDO5,%/¶VRWKHUVXEVLGLDULHVRSHUDWHLQWKHOHDVLQJ
UHDOHVWDWHDQGLQVXUDQFHMRLQWYHQWXUHZLWK5R\DO6XQ$OOLDQFHVHJPHQWV
x )LQDQFLDOV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
5,%/¶VQHWLQFRPHLQFUHDVHG<R<WR65EQPDLQO\GXHWRDGHFOLQH
LQSURYLVLRQV7KHEDQN¶VQHWVSHFLDOFRPPLVVLRQLQFRPHJUHZQRQ
LQWHUHVWLQFRPHLQFUHDVHGOHDGLQJWRJURZWKLQWRWDORSHUDWLQJ
LQFRPH7KHEDQN¶VWRWDOORDQVLQFUHDVHGORZHUWKDQLQGXVWU\DYHUDJH
DVWKHEDQNIRFXVHGRQPDLQWDLQLQJ1,0V3URYLVLRQVIRUFUHGLWORVVHV
GHFOLQHGZKLOHQRUHFRYHU\ZDVUHFRUGHGIRUSURYLVLRQVRILPSDLUHG
LQYHVWPHQWVLQFRPSDUHGWR65PQLQ
x 5HFHQWGHYHORSPHQWV
,Q0DUFK)LWFKDIILUPHG5,%/¶V/RQJ7HUP,VVXHU'HIDXOW5DWLQJ,'5
DW
$
ZLWKDVWDEOHRXWORRN,Q-DQXDU\5,%/GHFODUHGGLYLGHQGVRI
65PQIRUWKH+'XULQJWKHPRQWK63DIILUPHG5,%/¶V$$
UDWLQJZLWKµVWDEOH¶RXWORRN,Q2FWREHUWKHEDQNVLJQHGDEULGJHORDQ
DJUHHPHQWZLWK6DKDUD3HWURFKHPLFDOV&RPSDQ\IRUXSWR65EQWRILQDQFH
WKHODWWHU¶VSURMHFWV
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
5,%/$%
ZZZUL\DGEDQNFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
3([
$
(
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW6S&RP,QFRPH
2SHUDWLQJ,QFRPH
1HW,QFRPH
$VVHWV
(TXLW\
$GYDQFHV
7RWDO'HSRVLWV
1HW,QWHUHVW0DUJLQ
&RVW,QFRPH
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
0D\
6HS
-DQ
7$6,
0D\
5,%/5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
3XEOLF,QYVW)XQG
*26,
33$
$O1DKOD*URXS
0DVHN+ROGLQJ&RPSDQ\
6RXUFH7DGDZXO1&%&5HVHDUFK
31
%$1.,1*~0$<
6$%%
$/62.12:1$67+(6$8',%5,7,6+%$1.
6$%%IRUPHUO\7KH6DXGL%ULWLVK%DQNLVDQDIILOLDWHRI+6%&
*URXS7KHEDQNFRPPHQFHGRSHUDWLRQVLQRIIHULQJ
FRQYHQWLRQDODQG,VODPLFSURGXFWVXQGHUWKHEUDQGQDPHRI
6$%%$PDQDK6$%%RSHUDWHVEUDQFKHVDQG$70V
7KHEDQNDOVRKDVDVVRFLDWHFRPSDQLHVRIIHULQJLQYHVWPHQW
EDQNLQJVROXWLRQVDQGLQVXUDQFHVHUYLFHV
x %XVLQHVVEULHI
29(5:(,*+7
&XUUHQWSULFH65 3ULFLQJDVRI
6$%%RIIHUVSHUVRQDOFRUSRUDWHSULYDWHDQG,VODPLFEDQNLQJDVZHOODV
WUHDVXU\DQGWUDGHVHUYLFHV'XULQJWKH\HDUDVVHWVDQGOLDELOLWLHVRI
6$%%6HFXULWLHVZKROO\RZQHGDUPRI6$%%SURYLGLQJEURNHUDJHDQG
VHFXULWLHVVHUYLFHVZHUHWUDQVIHUUHGWR+6%&6DXGL$UDELD/WGDILUP
SURYLGLQJLQYHVWPHQWEDQNLQJVROXWLRQV7KLVUDLVHG6$%%¶VVWDNHLQ+6%&
6DXGL$UDELDWRIURPZHI-XO\6$%%DOVRSURYLGHV
6KDULD¶DFRPSOLDQWLQVXUDQFHSURGXFWVWKURXJK6$%%7DNDIXO
x )LQDQFLDOV
6$%%¶VQHWLQFRPHVXUJHG<R<WR65EQLQPDLQO\GULYHQE\
DGHFOLQHLQSURYLVLRQV7KHEDQN¶VWRWDORSHUDWLQJLQFRPHJUHZDPDUJLQDO
<R<GXHWRDVWURQJLQFUHDVHLQQRQLQWHUHVWLQFRPH6$%%¶V
1,0VGHFOLQHGESV<R<GXHWRLWVIRFXVRQLQFUHDVLQJORDQYROXPHVXS
<R<&RQVHTXHQWO\QHWVSHFLDOFRPPLVVLRQLQFRPHGHFOLQHG
<R<+RZHYHUWKHGHFOLQHLQRSHUDWLQJH[SHQVHV<R<DQGSURYLVLRQV
<R<KHOSHGWKHEDQNWRRIIVHWWKHLPSDFWRIVXEGXHGWRSOLQH
SHUIRUPDQFHDQGSRVWVLJQLILFDQWJURZWKLQSURILWV
x 5HFHQWGHYHORSPHQWV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6$%%$%
ZZZVDEEFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
,Q0DUFKWKHEDQNVXFFHVVIXOO\FRPSOHWHGWKHSULYDWHSODFHPHQWRI
ILYH\HDU7LHU,,6XNXNVDPRXQWLQJ65EQZLWKDFRXSRQUDWHRI6,%25
7KLVZLOOSURYLGHORQJWHUPIXQGLQJEDVHGLYHUVLI\VRXUFHVRIIXQGVDQG
VXSSRUWLWVSHQHWUDWLRQLQWRWKHUHWDLOVHJPHQW'XULQJWKHVDPHPRQWK6$%%
LQFUHDVHGLWVSDLGXSFDSLWDOEDVHE\WR65QE\LVVXLQJRQHERQXV
VKDUHIRUHYHU\WKUHHVKDUHVKHOGDQGGLVWULEXWHGFDVKGLYLGHQGVRI
65PQIRUWKH\HDU
9$/8$7,2108/7,3/(6
$
3([
$
(
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW6S&RP,QFRPH
2SHUDWLQJ,QFRPH
1HW,QFRPH
$VVHWV
(TXLW\
$GYDQFHV
7RWDO'HSRVLWV
1HW,QWHUHVW0DUJLQ
&RVW,QFRPH
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH&RPSDQ\1&%&5HVHDUFK
(
(
<R< &$*5
(
0D\
6HS
-DQ
7$6,
0D\
6$%%5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
+6%&+ROGLQJV&R
$O2OD\DQ6DXGL,QYVW&R
*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
32
%$1.,1*~0$<
6$8',+2//$1',%$1.
$/62.12:1$66+%
6DXGL+ROODQGL%DQN6+%KHDGTXDUWHUHGLQ5L\DGKZDV
HVWDEOLVKHGLQZLWKWKHFRQYHUVLRQRI$%1$PURLQWRD
MRLQWYHQWXUHEDQN&XUUHQWO\DFRQVRUWLXPOHGE\5%6KROGV
VWDNHLQ6+%7KHEDQNRIIHUVFRQYHQWLRQDODQG,VODPLF
SURGXFWVWKURXJKDQHWZRUNRIEUDQFKHVDQG$70V
DFURVV.6$
x %XVLQHVVEULHI
29(5:(,*+7
&XUUHQWSULFH65 3ULFLQJDVRI
6+%¶VFRUHDFWLYLWLHVLQFOXGHFRUSRUDWHEDQNLQJUHWDLOEDQNLQJDQGWUHDVXU\
VHUYLFHV7KHEDQNRIIHUVSUHIHUUHGEDQNLQJVHUYLFHVVXFKDVGRPHVWLFDQG
LQWHUQDWLRQDOVKDUHWUDGLQJVHUYLFHVDQGPXWXDOIXQGSRUWIROLRVWRKLJKQHW
ZRUWKLQGLYLGXDOV+1,VXQGHUWKHZHDOWKPDQDJHPHQWVHJPHQW
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
x )LQDQFLDOV
6+%¶VQHWLQFRPHLQFUHDVHG<R<LQZLWKDGHFOLQHLQSURYLVLRQV
IRUFUHGLWORVVHV7KHEDQN¶VQHWVSHFLDOFRPPLVVLRQLQFRPHURVHMXVW
<R<EXWVWURQJJURZWKLQQRQLQWHUHVWLQFRPH<R<OHGWRDPRGHUDWH
JURZWKRILQWRWDORSHUDWLQJLQFRPH7KHEDQN¶VWRWDORSHUDWLQJLQFRPH
URVH<R<+RZHYHUDIDOOLQSURYLVLRQVERRVWHG6+%¶VQHWLQFRPH
7KHEDQN¶VORDQERRNH[SDQGHGDWDPRGHUDWHUDWHRI<R<ZKLOHWRWDO
GHSRVLWVJUHZUDLVLQJWKHWRWDOORDQWRGHSRVLWUDWLRWRLQ
IURPLQ
x 5HFHQWGHYHORSPHQWV
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$$$/$%
ZZZVKEFRPVD
,Q0DUFK6+%GLVWULEXWHGFDVKGLYLGHQGVRI65PQIRUDQG
LQFUHDVHGLWVSDLGXSFDSLWDOEDVHE\WR65PQIURP65PQ
E\LVVXLQJRQHERQXVVKDUHIRUHYHU\ILYHVKDUHVKHOG,Q)HEUXDU\
)LWFKDIILUPHG6+%¶V/RQJWHUP,VVXHU'HIDXOW5DWLQJ,'5DW
$
ZLWKD
VWDEOHRXWORRN,Q'HFHPEHUWKH%RDUGRI'LUHFWRUVDQQRXQFHGWKH
UHVLJQDWLRQRI+('U)DKDG$O0XEDUDN,Q1RYHPEHU6+%DSSRLQWHG
-RKQ0DFHGRDV$FWLQJ&KLHI)LQDQFLDO2IILFHUVLQFHKHKDVEHHQ
DVVRFLDWHGZLWKWKHEDQNDV$*03ODQQLQJ6WUDWHJ\%XVLQHVV
3HUIRUPDQFH
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
3([
$
(
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW6S&RP,QFRPH
2SHUDWLQJ,QFRPH
1HW,QFRPH
$VVHWV
(TXLW\
$GYDQFHV
7RWDO'HSRVLWV
1HW,QWHUHVW0DUJLQ
&RVW,QFRPH
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
0D\
7$6,
6HS
-DQ
0D\
6DXGL+ROODQGL 5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
5%6)RUWLV*URXSDQG%DQFR
6DQWDQGHU$%1$052
$O2OD\DQ6DXGL,QYVW&R
*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
33
%$1.,1*~0$<
$5$%1$7,21$/%$1.
$/62.12:1$6$1%
$UDE1DWLRQDO%DQN$1%FRPPHQFHGRSHUDWLRQVLQWKH.6$
LQIROORZLQJWKHWDNHRYHURI$UDE%DQN3/&7KHEDQN
RSHUDWHVDQHWZRUNRIORFDOEUDQFKHVDQG$70V
DORQJZLWKRQHEUDQFKLQ/RQGRQ$1%KROGVVWDNHLQ
$UDE1DWLRQDO,QYHVWPHQW&RDQGVWDNHLQ$UDELDQ
+HDY\(TXLSPHQW/HDVLQJ&R
x %XVLQHVVEULHI
1(875$/
&XUUHQWSULFH65 3ULFLQJDVRI
$1%RIIHUVSHUVRQDOEDQNLQJFRUSRUDWHEDQNLQJWUHDVXU\VHUYLFHVDQG
672&.'(7$,/6
V\QGLFDWLRQVDQGFRUSRUDWHILQDQFHVHUYLFHV%HVLGHVFRUHEDQNLQJDFWLYLWLHV ZHHNUDQJH+/65
LWRIIHUVLQYHVWPHQWEDQNLQJKHDY\HTXLSPHQWOHDVLQJDQGKRXVLQJILQDQFH
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
VHUYLFHVWKURXJKLWVVXEVLGLDULHVDQGDVVRFLDWHFRPSDQLHV$1%,QYHVW
KDQGOHVLQYHVWPHQWEDQNLQJDQGDVVHWPDQDJHPHQWRSHUDWLRQVZKLOH
3ULFHSHUIRUP 0
$UDELDQ+HDY\(TXLSPHQW/HDVLQJ&RRSHUDWHVXQGHU6KDULD¶DJXLGHOLQHV
$EVROXWH
DQGOHDVHVKHDY\HTXLSPHQW6DXGL+RPH/RDQV&RLVDQDVVRFLDWH
0DUNHW
SURYLGLQJKRXVLQJILQDQFHVHUYLFHV
6HFWRU
x )LQDQFLDOV
$1%¶VQHWLQFRPHLQFUHDVHG<R<WR65EQLQGHVSLWHD
PDUJLQDOJURZWKRILQQHWVSHFLDOFRPPLVVLRQLQFRPHDQGLQWRWDO
RSHUDWLQJLQFRPH7KLVZDVPDLQO\GXHWRD<R<GHFOLQHLQORDQORVV
SURYLVLRQV$1%¶VORDQERRNJUHZ<R<KRZHYHUORZHU1,0VNHSWWKH
JURZWKLQQHWVSHFLDOFRPPLVVLRQLQFRPHPXWHG7KHEDQN
VQRQLQWHUHVW
LQFRPHJUHZMXVW<R<&RXSOHGZLWKKLJKHURSHUDWLQJH[SHQVH$1%¶V
SUHSURYLVLRQSURILWVIHOO<R<+RZHYHUWKHVLJQLILFDQWUHGXFWLRQLQ
SURYLVLRQVLPSURYHGWKHERWWRPOLQHSHUIRUPDQFH
0
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$51%$%
ZZZDQEFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
x 5HFHQWGHYHORSPHQWV
,Q0DUFK$1%VLJQHGDQDJUHHPHQWZRUWK65PQZLWK-HQDQ5HDO
(VWDWH&RPSDQ\WRILQDQFHFRPSDQ\SURMHFWV,Q'HFHPEHULW
DQQRXQFHGGLYLGHQGVRI65PQIRUWKH\HDU,Q2FWREHUWKH
EDQNFRQYHUWHGRILWVORFDOEUDQFKHVWR,VODPLFEDQNLQJWRRIIHU6KDULD¶D
FRPSOLDQWSURGXFWVWRFXVWRPHUV
0
9$/8$7,2108/7,3/(6
$
3([
$
(
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW6S&RP,QFRPH
2SHUDWLQJ,QFRPH
1HW,QFRPH
$VVHWV
(TXLW\
$GYDQFHV
7RWDO'HSRVLWV
1HW,QWHUHVW0DUJLQ
&RVW,QFRPH
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
0D\
7$6,
6HS
-DQ
0D\
$UDE1DWLRQDO5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
$UDE%DQN
*26,
5DVKLG$O$EGXO5DKPDQ$O
5DVKLG6RQV
$O-DEHU7UDGLQJ&R
6RXUFH7DGDZXO1&%&5HVHDUFK
34
%$1.,1*~0$<
6$8',,19(670(17%$1.
$/62.12:1$66$,%
7KH6DXGL,QYHVWPHQW%DQN6$,%ZDVHVWDEOLVKHGLQLQ
5L\DGKDQGQRZRSHUDWHVDQHWZRUNRIEUDQFKHVDQG
$70VLQ.6$6$,%SURYLGHVLQYHVWPHQWEDQNLQJDQGRWKHU
UHODWHGVHUYLFHVVXFKDVOHDVHILQDQFLQJLQVXUDQFH
UHLQVXUDQFHUHDOHVWDWHILQDQFLQJDQGILQDQFLDOLQYHVWPHQW
1(875$/
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
6$,%SURYLGHVSHUVRQDOFRUSRUDWHLQYHVWPHQWDQG,VODPLFEDQNLQJDORQJ
ZLWKWUHDVXU\VHUYLFHVLQ.6$,Q6HSWHPEHU&DSLWDO0DUNHW$XWKRULW\
672&.'(7$,/6
DSSURYHGDUHTXHVWE\$OLVWLWKPDU&DSLWDOEURNHUDJHDQGLQYHVWPHQWEDQNLQJ ZHHNUDQJH+/65
DUPRI6$,%WRDFTXLUH%133DULEDV$VVHW0DQDJHPHQW&R³$0&2´
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
DQRWKHUVXEVLGLDU\RI6$,%DVZHOODVLQFOXGHDOOOLFHQVHGDFWLYLWLHVVXFKDV
GHDOLQJPDQDJLQJDUUDQJLQJDGYLVLQJDQGFXVWRG\LQWR$OLVWLWKPDU¶V
3ULFHSHUIRUP 0
EXVLQHVVSURILOH,Q'HFHPEHUQHWDVVHWVRI$0&2ZHUHDFTXLUHGE\
$EVROXWH
$OLVWLWKPDU6$,%DOVRRIIHUVUHODWHGVHUYLFHVWKURXJKILYHDVVRFLDWH
0DUNHW
FRPSDQLHV$0(;6DXGL$UDELD/WG6DXGL2UL[/HDVLQJ&RPSDQ\0HGJXOI
6HFWRU
.6$$PODN,QWHUQDWLRQDODQG1DHHP,QYHVWPHQW&R
x )LQDQFLDOV
6$,%LVWKHRQO\EDQNDPRQJVWLWV6DXGLSHHUVWKDWUHSRUWHGDGHFOLQHLQORDQ
JURZWKDW<R<7KHEDQNKDVUHGXFHGLWVORDQERRNWRPLWLJDWH
FRQFHQWUDWLRQULVN$VDUHVXOW6$,%¶VQHWVSHFLDOFRPPLVVLRQLQFRPHDQG
WRWDORSHUDWLQJLQFRPHGHFOLQHGDQG<R<UHVSHFWLYHO\7KH
EDQN¶VRSHUDWLQJFRVWVDOVRURVH<R<LQFUHDVLQJLWVFRVWWRLQFRPHUDWLR
WRIURPLQ+RZHYHUWKHIDOOLQWRWDORSHUDWLQJLQFRPHDQG
KLJKHUH[SHQVHVZHUHRIIVHWE\DVWHHSGHFOLQHLQSURYLVLRQVZKLFKVWRRGDW
65PQLQFRPSDUHGWR65PQLQORZHU<R<7KLV
HQDEOHGWKHEDQNWRUHJLVWHUDVLJQLILFDQW<R<JURZWKLQLWVQHWSURILWV
,Q0DUFK6$,%GLVWULEXWHGFDVKGLYLGHQGVRI65PQIRU7KH
EDQNGLVWULEXWHGGLYLGHQGVIRUWKHILUVWWLPHLQVL[\HDUVWKHODVWFDVK
GLYLGHQGVZHUHJLYHQWRVKDUHKROGHUVLQ7KHGHFOLQHLQGLYLGHQGVFDPH
DIWHUPXWHGSURILWJURZWKDVWKHEDQNLQFUHDVHGLWVSURYLVLRQVIRULWVH[SRVXUH
WRIDPLO\RZQHGFRUSRUDWHV
0
0
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6,%&$%
ZZZVDLEFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
x 5HFHQWGHYHORSPHQWV
$
3([
$
(
3%[
36[
'LY<LHOG
1$
'36
6RXUFH1&%&5HVHDUFK
6+$5(35,&(3(5)250$1&(
&RPSDQ\ILQDQFLDOV
1HW6S&RP,QFRPH
2SHUDWLQJ,QFRPH
1HW,QFRPH
$VVHWV
(TXLW\
$GYDQFHV
7RWDO'HSRVLWV
1HW,QWHUHVW0DUJLQ
&RVW,QFRPH
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
0D\
6HS
-DQ
7$6,
0D\
6,%&5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
*26,
3XEOLF3HQVLRQ$XWKRULW\
6DXGL2JHU/WG
-30RUJDQ&KDVH&R
1DWLRQDO&RPP%DQN
6RXUFH7DGDZXO1&%&5HVHDUFK
35
%$1.,1*~0$<
%$1.$/%,/$'
$/62.12:1$6$/%,/$'
%DQN$OELODG$OELODGKHDGTXDUWHUHGLQ5L\DGKZDV
HVWDEOLVKHGLQWKURXJKWKHPHUJHURIHLJKWPRQH\
H[FKDQJHRUJDQL]DWLRQV7KHEDQNRSHUDWHVEUDQFKHVDQG
$70V$OELODG¶VZKROO\RZQHGVXEVLGLDULHVDUH$OELODG
%URNHUDJH6HFXULWLHV0DQDJHPHQW&R$OELODG,QYHVWPHQW
&RDQG$OELODG5HDO(VWDWH&R
x %XVLQHVVEULHI
1(875$/
&XUUHQWSULFH65 3ULFLQJDVRI
$OELODG¶VEXVLQHVVFDQEHGLYLGHGLQWRWKUHHPDMRUVHJPHQWVQDPHO\
&RQVXPHUVHUYLFH&RUSRUDWH6HUYLFHDQG,QYHVWPHQW6HUYLFH7KURXJKLWV
&RQVXPHUVHUYLFHVHJPHQWWKHEDQNRIIHUVDXWRILQDQFLQJSHUVRQDO
ILQDQFLQJUHDOHVWDWHILQDQFLQJDQGFUHGLWFDUGVHUYLFHV7KHEDQN¶V
&RUSRUDWH6HUYLFHVGLYLVLRQSURYLGHVDUDQJHRIILQDQFHVROXWLRQVVXFKDV
0XUDEDKD0XVKDUDND,VWLVQD¶DDQGVHFXULWL]DWLRQILQDQFHZKLOH,QYHVWPHQW
6HUYLFHVVHJPHQWRIIHUVLQYHVWPHQWDYHQXHVLQYDULRXVIXQGVLQFOXGLQJ$NDU
*&&5HDO(VWDWH)XQG$PZDO(TXLW\)XQGIRU,VODPLF)LQDQFLDO
,QVWLWXWLRQV$VD\HO6DXGL6KDUHV)XQG$O0XUDELK6DXGL5L\DO0XUDEDKD
)XQGDQG$O6HHI.XZDLWL6KDUHV)XQG7KHEDQNDOVRRIIHUVLQWHUQHW
WUDGLQJRI6DXGLVKDUHVWKRXJK$OELODG7DGDZXO
x )LQDQFLDOV
$OELODG¶VQHWLQFRPHJUHZWLPHVWR65PQLQGXHWRKLJKHU
JURZWKLQWRWDORSHUDWLQJLQFRPH,QWKHEDQN¶VQHWILQDQFLQJH[SDQGHG
<R<OHDGLQJWRJURZWKLQQHWVSHFLDOFRPPLVVLRQLQFRPH,Q
DGGLWLRQIHHLQFRPHLQFUHDVHG<R<HQDEOLQJJURZWKLQWRWDO
RSHUDWLQJLQFRPH+LJKHUJURZWKLQWRWDORSHUDWLQJLQFRPHWKDQLQRSHUDWLQJ
FRVWVDOVRLPSURYHGLWVFRVWWRLQFRPHUDWLRIRUDOWKRXJKLWZDVDWDQ
HOHYDWHG3URYLVLRQVIRUFUHGLWORVVHVLQFUHDVHGWKHUHZHUHQR
SURYLVLRQVRQLPSDLUHGLQYHVWPHQWVIRUFRPSDUHGWR65PQLQ
x 5HFHQWGHYHORSPHQWV
,Q)HEUXDU\WKHEDQNVROGWKHODQGVTXDUHPHWHUDUHD
ORFDWHGLQWKH'LU
L\DSURYLQFHLQ5L\DGKIRU65PQ7KLVUHVXOWHGLQD
FDSLWDOJDLQRI65PQIRUWKHEDQNLQWKHILUVWTXDUWHURIWKH
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$/%,$%
ZZZEDQNDOELODGFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
3([
$
(
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
&RPSDQ\ILQDQFLDOV
1HW6S&RP,QFRPH
2SHUDWLQJ,QFRPH
1HW,QFRPH
$VVHWV
(TXLW\
$GYDQFHV
7RWDO'HSRVLWV
1HW,QWHUHVW0DUJLQ
&RVW,QFRPH
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
0D\
6HS
7$6,
-DQ
0D\
$/%LODG5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
0RKG,EUDKLP0RKG$O6XEDHL
$EGXOODK,EUDKLP0RKG$O6XEDHL
$EGXO5DKPDQ6DOHK$EGXO$]L]
$O5DMKL
$EGXO5DKPDQ$EGXO$]L]6DOHK
$O5DMKL
)LUVW,QFVW&R
6RXUFH7DGDZXO1&%&5HVHDUFK
36
%$1.,1*~0$<
%$1.$/-$=,5$
$/62.12:1$6%-$=%$-
%DQN$O-D]LUD%-$=VSHFLDOL]HVLQ,VODPLFEDQNLQJDQG
LQYHVWPHQWSURGXFWVLQ6DXGL$UDELD7KHEDQNZDV
HVWDEOLVKHGLQIROORZLQJWKHWDNHRYHURIWKH6DXGL
$UDELDQEUDQFKHVRI1DWLRQDO%DQNRI3DNLVWDQ%-$=
RSHUDWHVDQHWZRUNRIEUDQFKHVDQG$70VDFURVVWKH
.6$
x %XVLQHVVEULHI
x )LQDQFLDOV
%-$=¶VQHWLQFRPHJUHZWLPHV<R<WR65PQLQOHGE\DQ
GHFOLQHLQSURYLVLRQV,QFUHDVLQJORDQSRUWIROLRDQGJURZLQJEURNHUDJHLQFRPH
IURPKLJKHU7DGDZXOWXUQRYHUHQDEOHGWKHEDQNWRSRVWDJURZWKLQQHW
VSHFLDOFRPPLVVLRQDQGLQFUHDVHLQIHHLQFRPH+RZHYHUDGHFOLQHLQ
LQYHVWPHQWLQFRPHVOLJKWO\ORZHUHGWKHJURZWKLQWRWDORSHUDWLQJLQFRPH
:LWKWKH<R<LQFUHDVHWKHEDQNVDZRQHRIWKHKLJKHVWORDQERRN
JURZWKVDPRQJWKHEDQNVLQWKH.LQJGRP&XVWRPHUGHSRVLWVDOVRJUHZ
VLJQLILFDQWO\DW<R<
x 5HFHQWGHYHORSPHQWV
6RXUFH&RPSDQ\1&%&5HVHDUFK
3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
%-$=$%
ZZZEDMFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
3([
$
(
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
&RPSDQ\ILQDQFLDOV
&XUUHQWSULFH65 ,Q'HFHPEHU%-$=DQQRXQFHGGLYLGHQGGLVWULEXWLRQRI65PQIRU
WKH\HDU,Q-XQH%-$=VLJQHGD65PQILYH\HDUGHDOZLWK
1DPD&KHPLFDOV&RPSDQ\7KLVILQDQFLDOIDFLOLW\ZRXOGEHXVHGWRVHUYLFHDQ
H[LVWLQJ0XUDEDKDORDQ65PQDQGWRHVWDEOLVKDQDGPLQLVWUDWLYH
EXLOGLQJ65PQ,Q-XQH&DSLWDO,QWHOOLJHQFHORZHUHG%-$=¶V
)LQDQFLDO6WUHQJWK5DWLQJ)65WR
%%%
IURP
%%%
ZKLOHWKHRXWORRNZDV
UHWXUQHGWR
6WDEOH¶IURPµ1HJDWLYH¶,QWKHVDPHPRQWK)LWFKDIILUPHG%-$=¶V
ORQJWHUP,VVXHU'HIDXOW5DWLQJ,'5DW
$
ZLWKVWDEOHRXWORRN
1HW6S&RP,QFRPH65PQ
2SHUDWLQJ,QFRPH 65PQ
1HW,QFRPH
65PQ
$VVHWV
65PQ
(TXLW\
65PQ
$GYDQFHV
65PQ
7RWDO'HSRVLWV
65PQ
1HW,QWHUHVW0DUJLQ &RVW,QFRPH
52(
52$
'LY3D\RXW
(36
65
%936
65
1(875$/
%-$=RIIHUV6KDULD¶DFRPSOLDQWUHWDLOEDQNLQJFRUSRUDWHEDQNLQJDQG
WUHDVXU\VHUYLFHV7KHEDQN¶VLQYHVWPHQWVXEVLGLDU\$O-D]LUD&DSLWDO$-&
LVRQHRIWKHOHDGLQJEURNHUDJHKRXVHVLQ6DXGL$UDELDLQWHUPVRIYDOXHDQG
YROXPHWUDGHG%-$=DOVRRSHUDWHV$PDQ5HDO(VWDWHZKLFKDFWVDVD
FXVWRGLDQRIFROODWHUDOLQWKHEDQN¶VOHQGLQJDFWLYLWLHV,QWKHEDQN
UHFHLYHGDJRYHUQPHQWDSSURYDOWRHVWDEOLVKD7DNDIXOFRPSDQ\ZLWKD
FDSLWDORI65PQ
(
(
<R<
&$*5
(
0D\
6HS
7$6,
-DQ
0D\
%-$=5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
5DVKHG$O$EGXO5DKPDQ$O
5DVKLG6RQV&R
$O2NKRDK8QLRQIRUGHYOS
1DWLRQDO%DQNRI3DNLVWDQ
6DOHK$EGXOODK0RKG.DPDO
6RXUFH7DGDZXO1&%&5HVHDUFK
37
%$1.,1*~0$<
$/,10$%$1.
$/62.12:1$6$/,10$
$OLQPD%DQN$OLQPDZDVHVWDEOLVKHGLQ0DUFKZLWKD
VKDUHFDSLWDORI65EQ,WRSHUDWHVDVD6KDULDKFRPSOLDQW
EDQNLQWKH.6$RIIHULQJUHWDLODQGFRUSRUDWHEDQNLQJ
VHUYLFHV7KHEDQNEHJDQIXOOIOHGJHGRSHUDWLRQVLQDQG
RSHUDWHVDQHWZRUNRIEUDQFKHVDQG$70V
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
$OLQPDLVD6KDULDKFRPSOLDQWEDQNWKDWSURYLGHVUHWDLODQGFRUSRUDWH
EDQNLQJVHUYLFHV7KHEDQNRIIHUVDVVHWPDQDJHPHQWEURNHUDJHLQYHVWPHQW 672&.'(7$,/6
EDQNLQJDQGZHDOWKPDQDJHPHQWVHUYLFHVWKURXJK$OLQPD,QYHVWPHQW&R
ZHHNUDQJH+/65
$OLQPDHQWHUHGLQWRDMRLQWYHQWXUHWRSURYLGH7DNDIXOLQVXUDQFHVHUYLFHV
0DUNHWFDSPQ
7KURXJKWKLVLWDLPVWRFDSLWDOL]HRQWKHYDVWXQWDSSHGUHWDLOPDUNHWIRU
6KDUHVRXWVWDQGLQJPQ
6KDULD¶DFRPSOLDQWLQVXUDQFHVHUYLFHV
3ULFHSHUIRUP
x )LQDQFLDOV
$EVROXWH
$OLQPD¶VQHWLQFRPHJUHZWLPHVWR65PQLQIURPMXVW65PQLQ
/RDQSRUWIROLRLQFUHDVHG<R<DQGGHSRVLWVJUHZ<R<LQ
SULPDULO\GXHWRDORZHUEDVHLQ2ZLQJWRJURZWKLQORDQERRNV
WKHEDQN¶VQHWVSHFLDOFRPPLVVLRQLQFRPHURVHZKLOHIHHLQFRPH
JUHZWLPHVFRQVHTXHQWO\WRWDORSHUDWLQJLQFRPHLQFUHDVHG
$OLQPD¶VSURYLVLRQVDOVRJUHZIURP65PQWR65PQLQKRZHYHULWV
FRVWWRLQFRPHUDWLRGHFOLQHGWRIURPHQDEOLQJVLJQLILFDQWJURZWKLQ
ERWWRPOLQH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$/,10$$%
ZZZDOLQPDFRP
x 5HFHQWGHYHORSPHQWV
:(,*+7,1*)5(()/2$7
,Q0DUFK$OLQPD,QYHVWPHQWZDVDSSRLQWHGOHDGPDQDJHUDQG
XQGHUZULWHUIRUWKHLQLWLDOSXEOLFRIIHULQJRI7RNLR0DULQH6DXGL$UDELD$OLQPD
%DQNKROGVVWDNHLQLWV65PQFDSLWDO,Q0DUFKWKHEDQN
DOVRVLJQHGWZRDJUHHPHQWVZLWK6DXGL5HDO(VWDWH'HYHORSPHQW)XQGWR
IDFLOLWDWHSURYLGLQJORDQV,Q)HEUXDU\WKHEDQNODXQFKHGDVHUYLFHWR
ILQDQFHUHVLGHQWLDOXQLWVXQGHUFRQVWUXFWLRQ'XULQJWKHVDPHPRQWKWKH
EDQNVWDUWHGLWVRSHUDWLRQVLQWKHQRUWKHUQERUGHUVUHJLRQDWWKHEUDQFKLQWKH
FLW\RI$U¶DULQOLQHZLWKLWVVWUDWHJ\WRPDNHLWVSUHVHQFHLQDOOWKHUHJLRQVRI
WKH.LQJGRP
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
3([
$
$
$
10
3%[
36[
'LY<LHOG
1$
1$
1$
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW6S&RP,QFRPH
2SHUDWLQJ,QFRPH
1HW,QFRPH
$VVHWV
(TXLW\
$GYDQFHV
7RWDO'HSRVLWV
1HW,QWHUHVW0DUJLQ
&RVW,QFRPH
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
1$
1$
0D\
6HS
7$6,
-DQ
0D\
$OLQPD5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
3XEOLF,QYVW)XQG
*26,
3XEOLF3HQVLRQ$XWKRULW\33$
6RXUFH7DGDZXO1&%&5HVHDUFK
38
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Petrochemicals
Ticker
Company
Page No.
2010
SABIC
44
2020
SAFCO
45
2310
Sipchem
46
2260
Sahara Petrochemical
47
2060
Industrialization
48
2350
Saudi Kayan
49
2290
YANSAB
50
2002
National Petrochem
51
2250
SIIG
52
2330
Advanced Petrochem
53
2380
Petro Rabigh
54
2210
Nama Chemicals
55
2170
Alujain
56
2001
Methanol Chemicals
57
0$<
3(752&+(0,&$/6
6WDUWXSVORZSURGXFWLRQFRVWWRVXSSRUWHDUQLQJV
7KH6DXGLSHWURFKHPLFDOVHFWRULVZHOOSRVLWLRQHGWRZLWKVWDQGDQ\
ZHDNQHVVLQGHPDQGE\FDSLWDOL]LQJRQLWVORZIHHGVWRFNFRVWDQG
DQH[SDQGLQJSURGXFWLRQEDVH7KHIXOO\HDUFRQWULEXWLRQIURP
6DXGL.D\DQDQG6DKDUD¶V$O:DKDSODQWDVZHOODVWKH
FRPPHQFHPHQWRI3HWURFKHP¶VFRPPHUFLDORSHUDWLRQVLQ4
VKRXOGERRVWWKHVHFWRU¶VHDUQLQJVLQ(3UR[LPLW\WRJURZLQJ
$VLDQPDUNHWVUHPDLQVDNH\SRVLWLYHIRUSHWURFKHPLFDOILUPVLQWKH
.LQJGRP
*OREDOSHWURFKHPLFDOSULFHVVWDUWHGWRGHFOLQHLQWKH+DVRLOSULFHVIHOOEHORZ
86'EEODQGGHPDQGZHDNHQHGLQNH\HQGPDUNHWV3RRUPDUNHWFRQGLWLRQV
DOVRLPSDFWHGWKHHDUQLQJVRI6DXGLSHWURFKHPLFDOSURGXFHUVGXULQJWKHVDPH
SHULRG+RZHYHUZHEHOLHYHILUPVDUHZHOOSODFHGWRZLWKVWDQGWKHDGYHUVH
PDUNHWFRQGLWLRQVJLYHQWKHLUORZSURGXFWLRQFRVWDVHWKDQHDQGSURSDQHNH\
IHHGVWRFNIRUSHWURFKHPLFDOVDUHVXSSOLHGDWUHGXFHGSULFHVE\6DXGL$UDPFR
,QRXURSLQLRQWKHUHLVOLWWOHVFRSHRIDVWURQJUHERXQGLQGHPDQGDQGSULFHVLQ
WKHQHDUWHUPDVPRVWGHPDQGLQGLFDWRUVDUHVWLOOZHDN
3HWURFKHPLFDOSURGXFHUVLQWKH.LQJGRPSURFXUHHWKDQHDW86'PPEWX
ZKLFKLVPXFKORZHUWKDQWKHJOREDOVSRWSULFHVRIRYHU86'PPEWX:KLOH
UHYLHZLQJHWKDQHSULFHVLQHDUO\WKH2LO0LQLVWU\GHFLGHGWRNHHSJDV
SULFHVXQFKDQJHGIRUWKH\HDU&RPSDQLHVUHFHLYHSURSDQHDWDSULFHOLQNHGWR
WKHGLVFRXQWHGUDWHRIQDSKWKD7KRXJKWKLVGLVFRXQWKDVEHHQUHGXFHG
PDUJLQDOO\RYHUWKH\HDUVDURXQGLQWKHSURFXUHPHQWFRVWVWLOO
UHPDLQVDWWUDFWLYHIRUFRPSDQLHVUHODWLYHWRWKHLULQWHUQDWLRQDOFRXQWHUSDUWV
+RZHYHUZLWKOLPLWHGVXSSO\RIORZFRVWHWKDQH6DXGLSURGXFHUVDUHIRFXVLQJ
RQPL[HGIHHGFUDFNHUV7KHUHVXOWDQWLQFUHDVHLQSURGXFWLRQFRVWVGXHWRDQ
DQWLFLSDWHGULVHLQHWKDQHFRVWLQ(DQGLQFOXVLRQRIKHDYLHUIHHGVWRFNLV
QRWOLNHO\WRKDYHDVLJQLILFDQWLPSDFWRQWKHHDUQLQJVRI6DXGLSURGXFHUV7KLV
FRXOGEHDVFULEHGWRDQH[SDQVLRQLQWKHLUSURGXFWLRQEDVHDQGDFFHVVWR
JURZLQJPDUNHWVLQ$VLDDQGWKH0LGGOH(DVW
,QUHFHQW\HDUVSHWURFKHPLFDOFRPSDQLHVLQ6DXGL$UDELDKDYHXQGHUWDNHQ
DJJUHVVLYHFDSH[WRFDSLWDOL]HRQULVLQJGHPDQGDQGWKHLUIHHGVWRFNFRVW
DGYDQWDJH$FFRUGLQJWR%0,WRWDOHWK\OHQHFDSDFLW\LQWKH.LQJGRPLVH[SHFWHG
WRJURZWRPQPWSDE\IURPDURXQGPQPWSDLQ0RUHRYHU
6$%,&LVVHHNLQJRSSRUWXQLWLHVWRLQYHVWLQGRZQVWUHDPSURGXFWVVXFKDV
SRO\XUHWKDQHVDQGSRO\DPLGHV7KHFRPSDQ\DLPVWRLQFUHDVH5'VSHQGLQJWR
RYHURIVDOHVLQIRUWKFRPLQJ\HDUVIURPEXGJHWHGIRU7DVQHHLV
XQGHUWDNLQJSURMHFWVWRDGGGRZQVWUHDPSURGXFWVVXFKDVDFU\OLFDFLGVDQG
SRO\ROVWRLWVSHWURFKHPLFDOSURGXFWPL[
7KHUHGXFLQJQXPEHURIDQWLGXPSLQJFODLPVLQNH\HQGPDUNHWVLVIDYRUDEOHIRU
WKHHDUQLQJVRXWORRN,Q-DQXDU\,QGLDZLWKGUHZDQWLGXPSLQJGXWLHVOHYLHG
RQWKH.LQJGRP¶VSRO\SURS\OHQHSURGXFHUVLQ1RYHPEHU,Q'HFHPEHU
WKH(XURSHDQ&RPPLVVLRQUHYRNHGDQWLGXPSLQJDQGDQWLVXEVLG\SUREHV
DJDLQVWSRO\HWK\OHQHWHUHSKWKDODWH3(7IURP6DXGL$UDELD,Q2FWREHU
&KLQHVHDXWKRULWLHVGHFLGHGDJDLQVWLPSRVLQJDQ\GXW\RQ6DXGLPHWKDQRO
SURGXFHUVDIWHUFRQGXFWLQJD\HDUORQJLQYHVWLJDWLRQ7KH&KLQHVHJRYHUQPHQW
40
3(752&+(0,&$/6
1&%&$3,7$/
0$<
ORZHUHGDQWLGXPSLQJFKDUJHVRQ6LSFKHP¶V%XWDQHGLRORXWSXWWRLQ
'HFHPEHUIURPLQ0D\
7KHVHFWRUFXUUHQWO\FRPSULVHVOLVWHGFRPSDQLHVZLWK6$%,&EHLQJWKH
ODUJHVW6$%,&LVDOVRWKHODUJHVWSHWURFKHPLFDOFRPSDQ\LQWKH0LGGOH(DVW
+HDGTXDUWHUHGLQ5L\DGKWKHFRPSDQ\¶VDQQXDOSURGXFWLRQYROXPHVDJJUHJDWHG
PQPWLQDQGDFFRXQWHGIRURIWRWDOUHYHQXHVIURPWKH
SHWURFKHPLFDOVHFWRULQ.6$LQ$QXSWUHQGLQWKHHDUQLQJVRI
SHWURFKHPLFDOSURGXFHUVFRQWLQXHGLQ7KHVHFWRU¶VQHWLQFRPHLQFUHDVHG
<R<WR65EQLQGULYHQE\KLJKHUSULFHVRISHWURFKHPLFDOVDQG
IHUWLOL]HUVDQGJURZWKLQSURGXFWLRQYROXPHV
Exhibit 43: Sector details
8QLWVDVVWDWHG
% weight in Index
as on 28 Mar 12
Country
6DXGL%DVLF,QGXVWULHV&RUS6$%,&
1DWLRQDO,QGXVWULDOL]DWLRQ&R1,&
6DXGL.D\DQ3HWURFKHPLFDO&RPSDQ\
<DQEX1DWLRQDO3HWURFKHPLFDO&R<$16$%
6DXGL,QGXVWULDO,QYHVWPHQW*URXS6,,*
6DXGL,QWHUQDWLRQDO3HWURFKHPLFDO&R6LSFKHP
6DKDUD3HWURFKHPLFDO
$GYDQFHG3HWURFKHPLFDO&RPSDQ\
5DELJK5HILQLQJDQG3HWURFKHPLFDO&R
1DPD&KHPLFDOV
&KHPDQRO
3HWURFKHP
$OXMDLQ&RUSRUDWLRQ
NIM (%),
2011
10
Avg. RoE
(%), 2011
6RXUFH6DXGL6WRFN([FKDQJH7DGDZXO
,QWKHSHWURFKHPLFDOVHFWRU¶VFRPELQHGUHYHQXHVDOORIWKH
FRPSDQLHVLQFUHDVHG<R<WR65EQVXSSRUWHGE\VWURQJSULFHV
GXULQJWKHILUVWKDOIRIWKH\HDUDGGLWLRQDOUHYHQXHVIURPQHZVWDUWXSVVXFKDV
6DXGL.D\DQDQG6DKDUDDQGWKHIXOO\HDUFRQWULEXWLRQIURP<DQVDEDQG
6LSFKHP¶V3KDVHH[SDQVLRQSURMHFW6$%,&UHSRUWHGD<R<ULVHLQ
UHYHQXHVLQ1HWPDUJLQVRISHWURFKHPLFDOILUPVH[SDQGHGWRLQ
IURPLQ/RVVHVUHSRUWHGE\6DXGL.D\DQ1DPD&KHPLFDOV
3HWURFKHPDQG$OXMDLQLPSDFWHGWKHRYHUDOOHDUQLQJVJURZWKLQ
Exhibit 44: Revenues of companies, 2005±11
Exhibit 45: Profitability of companies, 2005-11
65PQ
6$%,&
6$)&2
6RXUFH7DGDZXO1&%&5HVHDUFK
<DQVDE
6LSFKHP
2WKHUV
6$% ,&
6$)&2
<DQ VDE
6LSFKH P
1,&
6RXUFH7DGDZXO1&%&5HVHDUFK
6WRFNPXOWLSOHVLPSURYHGLQDQGDIWHUIDOOLQJGUDVWLFDOO\LQ7KH
XSWUHQGUHYHUVHGLQDVLQYHVWRUVDGRSWHGDFDXWLRXVDSSURDFKDPLGVLJQV
RIVORZHUHFRQRPLFJURZWKLQGHYHORSHGFRXQWULHV2IWKHNH\VWRFNVLQWKH
41
3(752&+(0,&$/6
1&%&$3,7$/
0$<
VHFWRU6$%,&WUDGHGDWD5R(DQG3%PXOWLSOHRIDQG[DWHQG
UHVSHFWLYHO\YHUVXVDQG[DWHQGUHVSHFWLYHO\
Exhibit 46: Comparison of P/B and ROE, 2010
Exhibit 47: Comparison of P/B and ROE, 2011
6$)&2
6$)&2
6$%,&
<DQVDE
$33&
6LSFKHP
1DPD
1,&
6DKDUD
$OXMDLQ
5DELJK
6,,*
<DQVDE
6$%,&
$33&
6LSFKHP
6DKDUD
1,&
6,,*
&KHPDQRO
3%[
3%[
5DELJK
3HWURFKHP
$OXMDLQ
.D\DQ
3HWURFKHP
&KHPDQRO
.D\DQ
52(
52(
1DPD
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
7UDGLQJWXUQRYHURI.6$SHWURFKHPLFDOVWRFNVDYHUDJHGWR65PQGDLO\LQ
FRPSDUHGWR65PQGDLO\LQ:LWKLQWKHVHFWRU6$%,&ZLWKDQ
DYHUDJHGDLO\WXUQRYHURI65PQLQKDGWKHODUJHVWWXUQRYHU
Exhibit 48: Avg. daily turnover, Jan11 ± Dec11
Exhibit 49: Share price movement, Jan11 ± Dec11
65PQ
5HEDVHGWRRQVW-DQ
6RXUFH7DGDZXO1&%&5HVHDUFK
3HWURFKHP
&KHPDQRO
5DELJK
.D\DQ
$33 &
$OXM DLQ
1,&
6LSFKH P
1DPD
<DQ VDE
6DK DUD
6,,*
6$)&2
6$% ,&
-DQ
0DU
6LSFKHP
0D\
1,&
$XJ <DQVDE
2FW
6$)&2
'HF
6$%,&
6RXUFH7DGDZXO1&%&5HVHDUFK
7KH7DGDZXO3HWURFKHPLFDOLQGH[GHFOLQHGLQDIWHUDJURZWKRI
LQ7KLVFRXOGEHDVFULEHGWRWKHSROLWLFDOLQVWDELOLW\LQWKHUHJLRQ
GXULQJ4DQGRQJRLQJFRQFHUQVUHODWHGWRWKH(XURSHDQGHEWFULVLVDQGD
VORZHUWKDQH[SHFWHGZRUOGHFRQRPLFJURZWK
Outlook for the Saudi petrochemical sector remains largely positive
)XOO\HDUFRQWULEXWLRQIURPVWDUWXSV±6DXGL.D\DQDQG6DKDUD¶V$O:DKDSODQWV
±DORQJZLWKWKHSUHYDLOLQJIHHGVWRFNDGYDQWDJHVWUHQJWKHQRXURXWORRNIRUWKH
.LQJGRP¶VSHWURFKHPLFDOVHFWRULQ)XUWKHUPRUHWKHVFKHGXOHGVWDUWXSDW
3HWURFKHPFRXOGHQDEOHSURGXFHUVWREHQHILWIURPWKHULVLQJGHPDQGLQ$VLDQ
HFRQRPLHV+RZHYHUZHEHOLHYHDVWURQJUHERXQGLQGHPDQGLQWKHQHDUWHUP
LVXQOLNHO\JLYHQWKHRQJRLQJGHEWFRQFHUQVLQ(XURSHDQGDVORZGRZQLQ
&KLQD¶V*'3JURZWK,QRXURSLQLRQWKHVHFWRU
VIHHGVWRFNDGYDQWDJHDQG
SUR[LPLW\WRKLJKJURZWKPDUNHWVLQ$VLDDQGWKH0LGGOH(DVWZRXOGFRQWLQXHWR
RIIHUVXSSRUWJRLQJIRUZDUG
42
3(752&+(0,&$/6
1&%&$3,7$/
0$<
1&%&5HFRPPHQGDWLRQVLQWKH6HFWRU
3HWURFKHPLFDOVWRFNVXQGHURXUFRYHUDJHXQLYHUVHLQFOXGH6$%,&6$)&2
6LSFKHP7DVQHH<DQVDE6DKDUD6DXGL.D\DQDQG3HWURFKHP'HWDLOHG
LQIRUPDWLRQRQWKHFRPSDQLHV¶SHUIRUPDQFHLVLQFOXGHGLQRXU.6$
3HWURFKHPLFDOV6HFWRU8SGDWHUHOHDVHGLQ0DUFK
Exhibit 50: Coverage stocks details
Stock
Current Rating
6$%,&
6(
2YHUZHLJKW
6LSFKHP
6(
2YHUZHLJKW
6$)&2
6(
2YHUZHLJKW
1,&7DVQHH
6(
1HXWUDO
6DKDUD
6(
1HXWUDO
<DQVDE
6(
1HXWUDO
6DXGL.D\DQ
6(
1HXWUDO
3HWURFKHP
6(
8QGHUZHLJKW
PT (SR)
Comments
6$%,&EHQHILWVIURPLWVGLYHUVLILHGSURGXFWPL[DQLQWHJUDWHGSURGXFWLRQIORZ
ZLGHJHRJUDSKLFDOUHDFKDQGFRQWLQXHGIHHGVWRFNFRVWDGYDQWDJHDWLWVIDFLOLWLHV
LQ6DXGL$UDELD$WFXUUHQWOHYHOVZHEHOLHYHWKHVWRFNRIIHUVDQDWWUDFWLYH
LQYHVWPHQWRSSRUWXQLW\FRQVLGHULQJWKHHDUQLQJVJURZWKSRWHQWLDODQGWKH
FRPSDQ\¶VVXVWDLQHGIRFXVRQH[SDQVLRQLQGLIIHUHQWSURGXFWOLQHVDQG
JHRJUDSKLHV
,Q6LSFKHP¶VRSHUDWLRQDOHIILFLHQF\LPSURYHGDVDOORILWVSODQWV3KDVH
DQGZHUHRSHUDWLQJDWWKHLUGHVLJQHGFDSDFLWLHVWKHUHE\RIIHULQJIXOOEHQHILWV
RIDQLQWHJUDWHGSURGXFWIORZ5HVXOWDQWLPSURYHPHQWLQSURILWDELOLW\LVH[SHFWHG
WRGULYHWKHFRPSDQ\¶VHDUQLQJVLQ(
7KHFRPSDQ\
VKLJKPDUJLQVORZFDSH[UHTXLUHPHQWVDQGVKRUWFDVK
FRQYHUVLRQF\FOHUHVXOWLQKLJKIUHHFDVKIORZVDQGWKHUHE\KLJKGLYLGHQG
SD\PHQWV:HEHOLHYHFRQWLQXHGVWUHQJWKLQGHPDQGIRUIHUWLOL]HUVDQGWKH
6$)&2SURMHFWZRXOGUHPDLQDWWUDFWLYHLQWKHORQJUXQ
7DVQHHLVWKHRQO\WLWDQLXPGLR[LGH7L2SLJPHQWSURGXFHULQWKH0LGGOH(DVW
DQGLVPRQHWL]LQJLWVORZFRVWIHHGVWRFNDGYDQWDJHWKURXJKLWVSHWURFKHPLFDOV
EXVLQHVV&RQWLQXHGULVHLQ7L2SULFHVFRXOGVXSSRUW(HDUQLQJVJURZWK
KRZHYHUSHWURFKHPLFDOSULFHVDUHOLNHO\WRUHPDLQZHDN$Q\SRVLWLYHHDUQLQJV
VXUSULVHVGXHWRKLJKHUWKDQH[SHFWHGVHOOLQJSULFHVLQWKHWLWDQLXPGLR[LGH
EXVLQHVVDQGSRVLWLYHQHZVIORZUHODWHGWRWKHRQJRLQJSHWURFKHPLFDOSURMHFWV
DUHNH\VWRFNSULFHFDWDO\VWV
6DKDUD¶V(SHUIRUPDQFHLVH[SHFWHGWREHGULYHQE\WKHIXOO\HDU
FRQWULEXWLRQIURPLWV$O:DKDSODQWZKLFKFRPPHQFHGRSHUDWLRQVLQ$SULO
)XUWKHUPRUHWKUHHQHZVWDUWXSVSURGXFLQJDFU\ODWHVFDXVWLFVRGDHWK\OHQH
GLFKORULGHDQGVXSHUDEVRUEHQWSRO\PHUVDUHOLNHO\WRVXSSRUWWKHFRPSDQ\¶V
(HDUQLQJV+RZHYHUSRRUHDUQLQJVIURPWKH$O:DKDSURMHFWLQ+
UDLVHVFRQFHUQVRYHU6DKDUD¶VRSHUDWLRQDODELOLW\
:HDUHRSWLPLVWLFRQWKHFRPSDQ\¶VIXWXUHHDUQLQJVJURZWKGXHWRLWVORZFRVW
VWUXFWXUHDQGJURZLQJGHPDQGIURPHPHUJLQJHFRQRPLHV+RZHYHUZHEHOLHYH
WKHFXUUHQWYDOXDWLRQRIVWRFNIDFWRUVLQDOOSRVLWLYHVDVVRFLDWHGZLWKWKH
FRPSDQ\DQGRIIHUVOLPLWHGXSVLGHSRWHQWLDO0RUHRYHUFRQWLQXHGXQFHUWDLQW\
RYHUHFRQRPLFFRQGLWLRQVLQ(XURSHWKHNH\HQGPDUNHWZHLJKKHDYLO\RQ
<DQVDE¶VQHDUWHUPHDUQLQJVRXWORRN
$GLYHUVLILHGSURGXFWPL[DQGVWURQJOLQNVZLWK6$%,&DUHNH\SRVLWLYHVIRUWKH
VWRFN+RZHYHUSRRUSHUIRUPDQFHLQ4LQGLFDWHV6DXGL.D\DQLVIDFLQJ
VRPHWHFKQLFDOLVVXHVDQGLVQRWDEOHWRPDQDJHWKHLQWHJUDWHGSURGXFWIORZDV
DQWLFLSDWHGHDUOLHU,QRXURSLQLRQWKHFRPSDQ\¶VDELOLW\WRUDPSXSSURGXFWLRQ
DWIXOOFDSDFLW\LVLPSHUDWLYHIRUJURZWKLQIXWXUHHDUQLQJV
7KHFRPSDQ\LVVFKHGXOHGWRFRPPHQFHRSHUDWLRQVLQ4DQGZRXOGEH
HQWHULQJLQWRHWK\OHQHDQGSURS\OHQHGHULYDWLYHVWKURXJKD-9ZLWK&KHYURQ
3KLOOLSV+RZHYHUSUHYDLOLQJGHPDQGDQGZHDNQHVVLQSULFLQJDUHOLNHO\WR
UHVWULFWHDUQLQJVJURZWKLQ($Q\XSGDWHRQWKHSURMHFWFRPPHQFHPHQW
ZRXOGEHDNH\FDWDO\VWIRUWKHVWRFNSULFH
6RXUFH1&%&5HVHDUFK
43
3(752&+(0,&$/6~0$<
6$8',%$6,&,1'8675,(6
&25325$7,21
$/62.12:1$66$%,&
Established in 1976, Saudi Basic Industries Corporation
(SABIC) is one of the leading petrochemical companies in the
world, with sales totaling SR190bn (USD50.7bn) in 2011. The
company produces basic chemicals (olefins, oxygenates and
aromatics), intermediates and polymers. SABIC also produces
fertilizers (through SAFCO, Ibn Al-Baytar and Al-Bayroni) and
metals (through Hadeed, ALBA and GARMCO).
x Business brief
6$%,&RSHUDWHVDFURVVWKHJOREHWKURXJKLWVVXEVLGLDULHVDQGDVVRFLDWHV,W
IXQFWLRQVWKURXJKVL[LQWHUOLQNHGGLYLVLRQV&KHPLFDOV3RO\PHUV
3HUIRUPDQFH&KHPLFDOV,QQRYDWLYH3ODVWLFV)HUWLOL]HUVDQG0HWDOV7KH
FRPSDQ\LVWDUJHWLQJDQDQQXDOSURGXFWLRQFDSDFLW\RIPQPWSDE\
x Financials
,Q6$%,&UHSRUWHGUHYHQXHVRI65EQXS<R<DQGQHW
LQFRPHRI65EQXS<R<GXHWRKLJKHUSURGXFWLRQVDOHV
YROXPHVDQGVHOOLQJSULFHV)XOO\HDUFRQWULEXWLRQIURPWKUHHSURMHFWV±
UG
<DQVDE6KDUT H[SDQVLRQSURMHFWDQG&KLQDEDVHG6LQRSHF6$%,&
7LDQMLQ3HWURFKHPLFDO&RVXSSRUWHGWKHLPSURYHPHQWLQHDUQLQJV(%,7'$
PDUJLQVUHPDLQHGIODWDW<R<LQ
OVERWEIGHT
Current price
99.0
3ULFLQJDVRI
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x Recent developments
,Q)HEUXDU\6$%,&DORQJZLWK6LQRSHFDQQRXQFHGSODQVWREXLOGD
PHWKDQROFRPSOH[KDYLQJPHWKDQROWRSHWURFKHPLFDOVDQGPHWKDQROWR
ROHILQVSODQWVLQ7ULQLGDG7KHSURMHFW¶VFRVWLVHVWLPDWHGDW86'EQ%RWK
FRPSDQLHVDUHKROGLQJWDONVZLWKWKH*RYHUQPHQWRI7ULQLGDGWRSURFXUH
QHFHVVDU\QDWXUDOJDVIRUWKHSURSRVHGSURMHFW$ILQDODQGELQGLQJ
DJUHHPHQWLV\HWWREHVLJQHG,Q0D\6$%,&HQWHUHGLQWRDQ
DJUHHPHQWZLWK-DSDQ¶V0LWVXELVKL5D\RQ&RWRFRQVWUXFWDPHWK\O
PHWKDFU\ODWHSODQWNPWSDDQGDSRO\PHWK\O00$SODQWNPWSD7KH
6$%,&6LQRSHF-9VLJQHGD0R8WRFRQVWUXFWDSRO\FDUERQDWHSODQWN
PWSDDWWKHLU7LDQMLQFRPSOH[ZKLFKZRXOGFRPPHQFHE\
6$%,&$%
ZZZVDELFFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
10A
11A
12E
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2010
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
2011
2012E
2013E
YoY
(%)
CAGR (%)
(10-13E)
0D\
$XJ
7$6,
1RY
)HE
0D\
6$%,&5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
3XEOLF,QYHVWPHQW)XQG
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
44
3(752&+(0,&$/6~0$<
6$8',$5$%,$1)(57,/,=(5&2
$/62.12:1$66$)&2
Established in 1965, Saudi Arabian Fertilizer Company
(SAFCO) produces ammonia and urea nitrogen-based
fertilizers. The company markets its products in Asia,
America, Australia, Africa and the Middle East countries.
Saudi Basic Industries Corp. (SABIC) holds a 43% stake in
SAFCO.
x Business brief
OVERWEIGHT
Current price (SR) 181.3
3ULFLQJDVRI
6$)&2KDVDXUHDSURGXFWLRQFDSDFLW\RYHUPQPWSDWKHPDMRULW\RI
ZKLFKLVH[SRUWHG8UHDLVDNH\QLWURJHQEDVHGIHUWLOL]HUDFURVVWKHJOREH
7KHFRPSDQ\DOVRPDQXIDFWXUHVPQPWSDRIDPPRQLDPRVWRIZKLFKLV
XVHGDVDQLQWHUPHGLDWHUDZPDWHULDOIRUSURGXFLQJXUHD
STOCK DETAILS
ZHHNUDQJH+/65
,QUHYHQXHVJUHZ<R<WR65PQPDLQO\GXHWRKLJKHU
IHUWLOL]HUSULFHV*URVVPDUJLQVVWRRGDWYHUVXVWKHUHSRUWHGD
\HDUDJR7KHFRPSDQ\¶VQHWSURILWURVHWR65PQLQ,QRXU
RSLQLRQ6$)&2¶VUHYHQXHDQGQHWSURILWIRUDUHOLNHO\WRUHPDLQEURDGO\
LQOLQHZLWKDVXUHDSULFHVDUHH[SHFWHGWRKRYHUDURXQGWKHOHYHOV
ZLWQHVVHGODVW\HDU
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
x Financials
0DUNHWFDSPQ
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
x Recent developments
2Q'HFHPEHU6$)&2DQQRXQFHGWKHUHVXOWVRIWKHIHDVLELOLW\
VWXGLHVXQGHUWDNHQIRUWKHSODQQHGXUHDSODQW7KHFRPSDQ\KDVGHFLGHGWR
DZDUGWKHHQJLQHHULQJSURFXUHPHQWDQGFRQVWUXFWLRQ(3&FRQWUDFWIRULWV
6$)&2SURMHFWWR,WDO\EDVHG6DLSHP&RQVWUXFWLRQZRUNLVVFKHGXOHGWR
EHFRPSOHWHGLQPRQWKVVWDUWLQJIURP'HFHPEHUDQGWKHSURMHFWLV
H[SHFWHGWRVWDUWFRPPHUFLDORSHUDWLRQVLQ47KHSURMHFWZRXOGDGGD
WRWDODQQXDOSURGXFWLRQFDSDFLW\RIPQPWRIXUHDZLWKWKHSURMHFWFRVW
WRWDOLQJ65EQ7KHFRPSDQ\DLPVWRIXQGWKHHQWLUHSURMHFWFRVWWKURXJKLWV
RZQUHVRXUFHV0U$EGXOODK%LQ$OL$O%DNUUHSODFHG0U)DKHG%LQ5DVKHG
$O2WDLELDV6$)&2¶VQHZ3UHVLGHQWRQ6HSWHPEHU
6(
%ORRPEHUJFRGH
6$)&2$%
ZZZVDIFRFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
10A
11A
12E
3%[
36[
3([
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
SHARE PRICE PERFORMANCE
2010
2011
2012E
2013E
YoY
(%)
CAGR (%)
(10-13E)
10
0D\
$XJ
7$6,
1RY
)HE 0D\
6$)&25+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
6$%,&
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
45
3(752&+(0,&$/6~0$<
6$8',,17(51$7,21$/
3(752&+(0,&$/&2
$/62.12:1$66,3&+(0
Established in 1999, Saudi International Petrochemical Co
(Sipchem) is engaged in producing petrochemical products
such as methanol, butanediol, carbon monoxide, acetic acid
and vinyl acetate. The company is expanding its product mix
through its Phase III development plan.
OVERWEIGHT
Current price (SR)
20.8
3ULFLQJDVRI
x Business brief
8QGHU3KDVH,6LSFKHPHVWDEOLVKHGDPHWKDQROSODQWZLWKDSURGXFWLRQ
FDSDFLW\RIPQWRQQHVSHUDQQXPPWSDDQGDEXWDQHGLROSODQWZLWKD
STOCK DETAILS
FDSDFLW\RINPWSD)ROORZLQJWKHFRPSOHWLRQRIWKH3KDVH,,H[SDQVLRQLQ
ZHHNUDQJH+/65
4WKHFRPSDQ\DGGHGFDUERQPRQR[LGHNPWSDDFHWLFDFLGN
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
PWSDDQGYLQ\ODFHWDWHNPWSDWRLWVSURGXFWPL[6LSFKHPLVFXUUHQWO\
XQGHUWDNLQJLWV3KDVH,,,H[SDQVLRQWRSURGXFHHWK\OHQHYLQ\ODFHWDWH(9$
Price perform (%) 1M
ORZGHQVLW\SRO\HWK\OHQH/'3(HWK\ODFHWDWHDQGVSHFLDOUHVLQJUDGHVXVHG
$EVROXWH
LQPDQXIDFWXULQJZLUHDQGFDEOHSURGXFWV
0DUNHW
6HFWRU
x Financials
6LSFKHPJHQHUDWHG65PQLQUHYHQXHVLQ65PQLQ
GULYHQE\WKHIXOO\HDUFRQWULEXWLRQIURPWKH3KDVH,,SODQWVDQGKLJKHU
SHWURFKHPLFDOSULFHV7KHQHWLQFRPHLQFUHDVHG<R<WR65PQ
EHQHILWLQJIURPLPSURYHGRSHUDWLRQDOHIILFLHQFLHVDVDOORILWVSODQWV3KDVH,
DQGDUHRSHUDWLQJDWWKHLUGHVLJQHGFDSDFLWLHVRIIHULQJIXOOEHQHILWVRI
LQWHJUDWHGSURGXFWIORZ
3M
12M
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6,3&+(0$%
ZZZVLSFKHPFRP
x Recent developments
WEIGHTING & FREEFLOAT (%)
,Q1RYHPEHU6LSFKHPWKURXJKLWVDIILOLDWH,QWHUQDWLRQDO3RO\PHUV
&RPSDQ\VHFXUHG65PQSD\DEOHLQ\HDUVIURP6,')7KHSURFHHGV
ZRXOGEHXVHGWRFRQVWUXFWWKH(9$/'3(SODQWNPWSDZKLFKLV
H[SHFWHGWRFRPPHQFHFRPPHUFLDORSHUDWLRQVLQ4,Q2FWREHULW
DZDUGHGDQ(3&FRQWUDFWIRUWKHZLUHDQGFDEOHSODQWDSDUWRIWKH3KDVH,,,
SURMHFWWRD6RXWK.RUHDQILUP3RVFR(QJLQHHULQJ&R7KHFRQVWUXFWLRQLV
H[SHFWHGWREHFRPSOHWHGLQWZR\HDUV6LSFKHPDQG6RXWK.RUHD¶V+DQZKD
KDYHDQHTXDOVKDUHLQWKH65PQSODQW7RIXQGH[SDQVLRQSODQV
6LSFKHPUDLVHG65EQWKURXJKLWVILUVWLVVXHRI6XNXNLQ-XO\
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
10A
11A
12E
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2010
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
2011
2012E
2013E
YoY
(%)
CAGR (%)
(10-13E)
0D\
6HS
7$6,
-DQ
0D\
6LSFKHP5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
=DPLO*URXS+ROGLQJ&RPSDQ\
1DWLRQDO0DQXIDFWXULQJ+ROGLQJ
&R
3XEOLF3HQVLRQ$XWKRULW\
$O2OD\DQ)LQDQFLDO&RPSDQ\
6RXUFH7DGDZXO1&%&5HVHDUFK
46
3(752&+(0,&$/6~0$<
6$+$5$3(752&+(0,&$/&2
$/62.12:1$66$+$5$63&2
Sahara Petrochemical Company (Sahara) was established in
2004 by the Al Zamil Group. The company develops, owns and
operates production facilities through joint ventures with
other companies in the petrochemical sector. Sahara has four
subsidiaries: Al Waha Petrochemical (Al Waha), Tasnee &
Sahara Olefins (TSOC), Saudi Acrylic Acid Company (SAAC)
and Arabian Chlor Vinyl Company (ACVC).
x
NEUTRAL
Current price (SR)
3ULFLQJDVRI
Business brief
STOCK DETAILS
$O:DKDKDVDSURGXFWLRQFDSDFLW\RINPWSDRISURS\OHQHDQGNPWSD ZHHNUDQJH+/65
0DUNHWFDSPQ
RISRO\SURS\OHQH,WVWDUWHGFRPPHUFLDOSURGXFWLRQLQ46DXGL(WK\OHQH
6KDUHVRXWVWDQGLQJPQ
DQG3RO\HWK\OHQH&R6(3&RZQHGE\6DKDUDKDVDSURGXFWLRQ
FDSDFLW\RIPQPWSDRIHWK\OHQHDQGNPWSDRISRO\HWK\OHQH6DKDUD
Price perform (%) 1M
DOVRKDVWKUHHSURMHFWVLQWKHSLSHOLQH6DXGL$FU\OLF0RQRPHUV&RPSDQ\
$EVROXWH
6$0&IRUSURGXFLQJDFU\ODWHV6XSHUDEVRUEHQW3RO\PHUV3URMHFW6$3
0DUNHW
3URMHFWIRUVXSHUDEVRUEHQWSRO\PHUVDQG$UDELDQ&KORU9LQ\O&RPSDQ\
6HFWRU
$&9&IRUFDXVWLFVRGDDQGHWK\OHQHGLFKRULGH
Avg daily turnover (mn)
x Financials
6DKDUD¶VUHYHQXHVVWRRGDW65PQQLOZLWKQHWLQFRPHDW
65PQXS<R<EHQHILWLQJIURPWKH$O:DKDVWDUWXS*URVVSURILWLQ
FDPHLQDW65PQQLODQGRSHUDWLQJSURILWVWRRGDW
65PQDJDLQVWDQRSHUDWLQJORVVRI65PQLQ(DUOLHU6(3&D
RZQHGVXEVLGLDU\ZDVWKHRQO\VRXUFHRILQFRPHIRUWKHFRPSDQ\
x Recent developments
15.8
3M
12M
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
63&$%
ZZZVDKDUDSFFFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
,Q)HEUXDU\6$0&VLJQHGDILQDQFLQJDJUHHPHQWRI65PQZLWK
6DXGL,QGXVWULDO'HYHORSPHQW)XQG6,')ZKLFKLVUHSD\DEOHDIWHU\HDUV
7KHSURFHHGVZRXOGEHXVHGWRILQDQFH6DKDUD¶VDFU\OLFDFLGSURMHFW,Q
'HFHPEHUWKURXJKLWVDIILOLDWHV6DKDUDVLJQHGD\HDUGHDORI
65EQZLWKQLQH6DXGL$UDELDEDVHGEDQNVWRIXQGDFU\OLFDFLGDQG
VXSHUDEVRUEHQWSRO\PHUSURMHFWV'XULQJWKHVDPHPRQWKWKHFRPSDQ\
RIIHUHGPQVKDUHVDWDSULFHRI65SHUVKDUHWKURXJKULJKWVLVVXH
ZKLFKLQFUHDVHGVKDUHFDSLWDOE\WR65EQIURP65EQ
)UHHIORDW
VALUATION MULTIPLES
10A
11A
3([
3%[
36[
'LY<LHOG
'36
12E
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
SHARE PRICE PERFORMANCE
2010
2011
2012E
2013E
YoY
(%)
10
10
CAGR (%)
(10-13E)
10
10
0D\
$XJ
1RY
7$6,
)HE
0D\
63&5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
$O=DPLO*URXS+ROGLQJ&RPSDQ\
3XEOLF3HQVLRQ$XWKRULW\
6RXUFH7DGDZXO1&%&5HVHDUFK
47
3(752&+(0,&$/6~0$<
1$7,21$/,1'8675,$/,=$7,21
&2
$/62.12:1$61,&7$61((
National Industrialization Company (Tasnee) was established
LQ5L\DGKLQWRVXSSRUWWKH.LQJGRP¶VLQGXVWULDO
GHYHORSPHQW,Q7DVQHHDFTXLUHG/\RQGHOO%DVHOO¶V
worldwide titanium dioxide business. In 2008, it acquired
Australia's Bemax Resources Ltd. and International Titanium
Powder (ITP).
x Business brief
NEUTRAL
Current price (SR)
3ULFLQJDVRI
7DVQHH¶VPDLQEXVLQHVVHVDUHLQSHWURFKHPLFDOVDQGWLWDQLXPGLR[LGH7L2
STOCK DETAILS
7KHFRPSDQ\DOVRKDVVPDOOHUEXVLQHVVOLQHVLQDXWRPRWLYHEDWWHULHVFDUWRQ
ZHHNUDQJH+/65
SDFNDJLQJDQGUHODWHGVHUYLFHV,Q7DVQHHLQD-9ZLWK6DKDUD2OHILQV
0DUNHWFDS65PQ
6KDUHVRXWVWDQGLQJPQ
DQG%DVHOOIRUPHG6DXGL(WK\OHQHDQG3RO\HWK\OHQH&R6(3&WKDWVWDUWHG
RSHUDWLRQVLQ-XQH6(3&KDVDFDSDFLW\RIPQPWSDRIHWK\OHQH
Price perform (%) 1M
FUDFNHUDQGNPWSDHDFKRIORZDQGKLJKGHQVLW\SRO\HWK\OHQH
$EVROXWH
x Financials
7DVQHHJHQHUDWHG65EQXS<R<LQUHYHQXHVZLWKQHWLQFRPH
UHDFKLQJ65EQXS<R<LQSULPDULO\GXHWRKLJKHUSULFHVRI
SHWURFKHPLFDOSURGXFWVDQGWLWDQLXPGLR[LGH7KHFRPSDQ\¶V(%,7'$
PDUJLQVLQFUHDVHGWRLQIURPD\HDUDJRGXHWRKLJKHU
VHOOLQJSULFHV
$WWKHH[WUDRUGLQDU\JHQHUDOPHHWLQJRQ0DUFK7DVQHH¶V
VKDUHKROGHUVDSSURYHGDERQXVVKDUHWKDWLQWXUQLQFUHDVLQJWKHVKDUH
FRXQWE\WRPQ,Q)HEUXDU\6DXGL$FU\OLF0RQRPHUV
&RPSDQ\/LPLWHGDQDIILOLDWHVLJQHGD65PQILQDQFLQJDJUHHPHQW
UHSD\DEOHDIWHU\HDUVZLWK6DXGL,QGXVWULDO'HYHORSPHQW)XQG6,')
7KHSURFHHGVZRXOGEHXVHGWRILQDQFH7DVQHH¶VDFU\OLFDFLGSURMHFW,Q
'HFHPEHUWKUHHVXEVLGLDULHV±6DXGL$FU\OLF$FLG&RPSDQ\6$$&
6DXGL$FU\OLF0RQRPHUV&RPSDQ\6$0&2DQG6DXGL6XSHUDEVRUEHQW
3RO\PHUV&RPSDQ\6$3&2±VLJQHGD\HDUGHDORI65EQ
86'EQZLWKQLQH6DXGLEDQNVWRIXQGWKHDFU\OLFDFLGDQG
VXSHUDEVRUEHQWSRO\PHUSURMHFWV
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
2010
2011
2012E
2013E
YoY
(%)
CAGR (%)
(10-13E)
1,&$%
ZZZWDVQHHFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
3([
10A
11A
12E
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
SHARE PRICE PERFORMANCE
Company financials
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
%ORRPEHUJFRGH
x Recent developments
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
33.6
0D\
6HS
-DQ
7$6,
0D\
1,&5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
$O6KD
HU7UDGH,QGXVWULHVDQG
&RQVWUXFWLRQ
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
*XOI,QYHVWPHQW&RUSRUDWLRQ
.LQJGRP+ROGLQJ&RPSDQ\
6ZLFRUS&R
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
48
3(752&+(0,&$/6~0$<
6$8',.$<$13(752&+(0,&$/
&2
$/62.12:1$6.$<$1
Saudi Kayan Petrochemical Company (Kayan) was
established by SABIC (35% stake) and Al Kayan
Petrochemical (20%) in 2007 to set up a petrochemical
complex in Jubail Industrial City. The plant has the capacity to
produce approximately 6mn mtpa of petrochemical products
each year.
x Business brief
NEUTRAL
Current price (SR)
16.9
3ULFLQJDVRI
7KHFRPSOH[ZKLFKLVEHOLHYHGWREHRQHRIWKHZRUOG
VODUJHVWLQWHJUDWHG
SHWURFKHPLFDOSODQWVPDQXIDFWXUHVVSHFLDOL]HGFKHPLFDOVVXFKDV
SRO\FDUERQDWHELVSKHQRO$DQGDFHWRQH.D\DQKDGFRPPHQFHGWULDO
RSHUDWLRQVDWPRVWRILWVSODQWVVXFKDVROHILQVHWK\OHQHJO\FRO
SRO\SURS\OHQHSKHQROLFVDQGKLJKGHQVLW\SRO\HWK\OHQHSODQWVGXULQJWKH
+DQG-DQXDU\7KHFRPSDQ\ODWHUVWDUWHGFRPPHUFLDORSHUDWLRQV
DWLWVPDLQSODQWVRQ2FWREHU([SHULPHQWDOUXQVDUHH[SHFWHGWR
VWDUWDWWKHUHPDLQLQJSODQWVLQSKDVHVGXULQJ
x Financials
4ZDVWKHILUVWTXDUWHUWKDW.D\DQUHSRUWHGRSHUDWLQJUHVXOWV+RZHYHU
GHVSLWHKDYLQJDIXOOTXDUWHUFRQWULEXWLRQIURPLWVNH\SODQWVWKHFRPSDQ\
LQFXUUHGDQRSHUDWLQJORVVLQ4DVLWVSODQWVZHUHUXQQLQJDWDORZHU
RSHUDWLQJUDWHRI±.D\DQUHSRUWHGDQHWORVVRI65PQLQ
FRPSDUHGWR65PQLQGXHWRKLJKHU=DNDWSURYLVLRQVDQGORZHU
SHWURFKHPLFDOSULFHVLQ4
x Recent developments
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
.$<$1$%
ZZZVDXGLND\DQFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
2Q0DUFKWKHFRPSDQ\DQQRXQFHGLWKDGLQLWLDWHGWULDOUXQVDWLWV
HWKDQRODPLQHVNPWSDDQGHWKR[\ODWHVNPWSDSODQWV2Q
)HEUXDU\.D\DQDQQRXQFHGWKDWLWVROHILQVFRPSOH[DQG+'3(SODQW
DUHRSHUDWLQJDWQRUPDOUDWHVDIWHUVKXWWLQJGRZQIRUPDLQWHQDQFHZRUN
GXULQJ)HEUXDU\7KHFRPSDQ\H[SHFWVWKHILQDQFLDOLPSDFWRIWKLV
WHPSRUDU\VKXWGRZQWREHUHIOHFWHGLQLWV4UHVXOWV
)UHHIORDW
VALUATION MULTIPLES
10A
11A
12E
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2010
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
2011
2012E
2013E
YoY
(%)
10
10
10
10
CAGR (%)
(10-13E)
10
10
10
10
0D\
6HS
7$6,
-DQ
0D\
.D\DQ5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
6$%,&
6RXUFH7DGDZXO1&%&5HVHDUFK
49
3(752&+(0,&$/6~0$<
<$1%81$7,21$/
3(752&+(0,&$/&203$1<
$/62.12:1$6<$16$%
Yanbu National Petrochemicals Company (Yansab) was
established in 2006 to set up a 4mn mt per annum
petrochemical complex in the Yanbu Industrial City. SABIC
holds a majority stake (51%) in Yansab. The company
commenced commercial operations in March 2010.
NEUTRAL
Current price (SR)
49.8
3ULFLQJDVRI
x Business brief
<DQVDEKDVDGLYHUVLILHGSHWURFKHPLFDOSURGXFWPL[LQFOXGLQJ(WK\OHQH
PQPWSD3URS\OHQHNPWSD3RO\SURS\OHQHNPWSD
3RO\HWK\OHQHERWKORZDQGKLJKGHQVLW\ZLWKNPWSDHDFKDQG0RQR'L
DQG7UL(WK\OHQH*O\FRONPWSDWRWDO2WKHUSURGXFWVVXFKDV%HQ]HQH
%XWHQH0HWK\O7HUWLDU\%XW\O(WKHUDQG%HQ]HQH7ROXHQH;\OHQHKDYHD
WRWDOSURGXFWLRQFDSDFLW\RIFORVHWRNPWSD
x Financials
<DQVDE¶VUHYHQXHVJUHZ<R<WR65EQLQDQGQHWLQFRPH
LQFUHDVHGWR65EQGULYHQE\KLJKHUSULFHVDQGSURGXFWLRQYROXPHV
,QWKHFRPSDQ\HQMR\HGWKHIXOO\HDUFRQWULEXWLRQIURPLWV
SHWURFKHPLFDOFRPSOH[ZKLFKVWDUWHGFRPPHUFLDORSHUDWLRQVLQ0DUFK
<DQVDEUHSRUWHGDJURVVSURILWRI65PQLQWKLVUHSUHVHQWVD
JURVVPDUJLQRIKLJKHUWKDQWKHD\HDUHDUOLHU:HEHOLHYHWKH
FXUUHQWZHDNGHPDQGIRUSHWURFKHPLFDOVLQ(XURSHDQGWKHDQWLFLSDWHGGURS
LQSHWURFKHPLFDOSULFHVZRXOGUHVWULFWJURZWKLQ<DQVDE¶VHDUQLQJVLQ(
)RU(ZHSURMHFWUHYHQXHVRI65EQIODW<R<QHWLQFRPHRI65EQ
GRZQ<R<DQGJURVVPDUJLQRIIODW<R<
x Recent developments
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
<$16$%$%
ZZZ\DQVDEFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
2Q0DUFK<DQVDEKHOGLWVIRXUWKDQQXDOJHQHUDOPHHWLQJDW<DQEX
,QGXVWULDO&LW\7KHFRPSDQ\GLGQRWSD\DQ\GLYLGHQGIRU
VALUATION MULTIPLES
10A
11A
3([
12E
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2010
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
2011
2012E
2013E
YoY
(%)
CAGR (%)
(10-13E)
0D\
6HS
7$6,
-DQ
0D\
<$16$%5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
6$%,&
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
50
3(752&+(0,&$/6~0$<
1$7,21$/3(752&+(0,&$/&2
$/62.12:1$66$8',3(752&+(03(752&+(0
National Petrochemical Company (Petrochem) was
established in 2008. The company is mainly involved in
investing in the petrochemical industry through its 65%
owned Saudi Polymers Company.
UNDERWEIGHT
Current price (SR)
24.4
3ULFLQJDVRI
x Business brief
3HWURFKHPFRPSOHWHGWKHFRQVWUXFWLRQRILWV65EQSHWURFKHPLFDO
FRPSOH[DWWKHHQGRI,WLVH[SHFWHGWRFRPPHQFHFRPPHUFLDO
RSHUDWLRQVLQ47KHSURMHFWFRVWLVHVWLPDWHGWREHRYHU65EQ2QFH
STOCK DETAILS
RSHUDWLRQDOWKHSURMHFWZRXOGKDYHDSURGXFWLRQFDSDFLW\RIPQPWSD
ZHHNUDQJH+/65
LQFOXGLQJHWK\OHQHSURS\OHQH+'3(/'3(SRO\SURS\OHQHSRO\VW\UHQHDQG
0DUNHWFDSPQ
KH[DQH3HWURFKHPLVRZQHGE\6DXGL,QGXVWULDO,QYHVWPHQW*URXS
6KDUHVRXWVWDQGLQJPQ
6,,*
Price perform (%)
x Financials
3HWURFKHPLQFXUUHGDQHWORVVRI65PQLQKLJKHUWKDQWKH
65PQLQSULPDULO\GXHWRKLJKHUJHQHUDODQGDGPLQLVWUDWLYH
H[SHQVHVDQG=DNDWSURYLVLRQV7KHFRPSDQ\LVLQDSUHRSHUDWLRQDOVWDJH
DQGLVH[SHFWHGUHSRUWLWVILUVWVHWRIRSHUDWLQJUHVXOWVLQ4:HH[SHFWWKH
FRPSDQ\¶VQHWLQFRPHWRWRWDO65PQLQ(ZLWKUHYHQXHVRI
65EQ(%,7'$PDUJLQVRIDQGQHWPDUJLQVRI
2Q)HEUXDU\3HWURFKHPDQQRXQFHGLWLVFXUUHQWO\FRQGXFWLQJWULDO
UXQVDQGFRPPLVVLRQLQJDWWKHXQLWVRILWVSHWURFKHPLFDOSURMHFW6DXGL
3RO\PHUV&RPSDQ\7KHFRPSDQ\PHQWLRQHGWKDWFRPPHUFLDORSHUDWLRQVDUH
VFKHGXOHGWRFRPPHQFHLQ4+RZHYHURQ'HFHPEHUWKH
FRPSDQ\KDGDQQRXQFHGFRPPHUFLDORSHUDWLRQVZRXOGVWDUWLQ4
3HWURFKHPRZQVDVWDNHLQWKLVSURMHFWZKLOHLVKHOGE\$UDELDQ
&KHYURQ3KLOOLSV3HWURFKHPLFDO&RPSDQ\/LPLWHG
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x Recent developments
3(752&+$%
ZZZSHWURFKHPFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
10A
11A
12E
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2010
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
2011
2012E
2013E
YoY
(%)
10
10
10
10
CAGR (%)
(10-13E)
10
10
10
10
0D\
$XJ
7$6,
1RY
)HE
0D\
3HWURFKHP5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
6DXGL,QGXVWULDO,QYHVWPHQW*US&R *HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
3XEOLF3HQVLRQ$XWKRULW\33$
6RXUFH7DGDZXO1&%&5HVHDUFK
51
3(752&+(0,&$/6~0$<
6$8',,1'8675,$/
$/62.12:1$66,,*
Saudi Industrial Investment Group (SIIG) was established in
1996 in Riyadh. The company primarily focuses on investment
RSSRUWXQLWLHVLQWKH.LQJGRP¶VSHWURFKHPLFDOVHFWRUSIIG
operates through three subsidiaries ± Saudi Chevron Phillips,
Jubail Chevron Phillips and National Petrochemicals
Company (PetroChem).
x Business brief
NOT COVERED
Current price
23.4
3ULFLQJDVRI
2IWKHWKUHHVXEVLGLDULHV6DXGL&KHYURQ3KLOLSVDQG-XEDLO&KHYURQ3KLOOLSV
DUHRSHUDWLRQDO6DXGL&KHYURQ3KLOOLSVSURGXFHVF\FORKH[DQHNPWSD
DQGPRWRUJDVROLQHNPWSDZKLOH-XEDLO&KHYURQ3KLOOLSVPDQXIDFWXUHV
VW\UHQHNPWSDDQGSURS\OHQHNPWSD,Q6,,*WKURXJK
3HWURFKHPIRUPHG6DXGL3RO\PHUV&RWRPDQXIDFWXUHDUDQJHRI
SHWURFKHPLFDOSURGXFWVVXFKDVHWK\OHQHSURS\OHQHDQGWKHLUGHULYDWLYHV
7KHSURMHFWHQWDLOLQJDQLQYHVWPHQWRI65EQKDVDQDQQXDOSURGXFWLRQ
FDSDFLW\RIPQPWDQGLVVFKHGXOHGWRFRPPHQFHRSHUDWLRQVLQ4
x Financials
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
6,,*¶VUHYHQXHVJUHZ<R<WR65PQLQIURP
65PQLQRQWKHEDFNRIKLJKHUSHWURFKHPLFDOSULFHVDQG
LPSURYHGXWLOL]DWLRQ7KHFRPSDQ\UHSRUWHGDQHWLQFRPHRI65PQLQ
KLJKHUWKDQWKH65PQLQ+RZHYHU6,,*¶VJURVVPDUJLQV
FRQWUDFWHGWRLQIURPLQGXHWRWKHZHDNSULFLQJ
HQYLURQPHQWLQ+DQGDGGLWLRQDOH[SHQVHVLQFXUUHGUHODWHGWRWKHPRQWK
ORQJPDLQWHQDQFHVKXWGRZQLQ2FWREHU
x Recent developments
12M
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6,,*$%
ZZZVLLJFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
,Q'HFHPEHU3HWURFKHPLFDO&RQYHUVLRQ&RPSDQ\/LPLWHG3&&
DZDUGHGDFRQWUDFWRI65PQWR1HVPDDQG3DUWQHUV&RQWUDFWLQJ&R/WG
IRUEXLOGLQJLWV1\ORQDQGFRQYHUVLRQSODQWVLQWKH-XEDLO,QGXVWULDO&LW\
7KHVHSODQWVDUHVFKHGXOHGWRVWDUWRSHUDWLRQVLQ3&&LVDQHTXDOO\
RZQHG-9EHWZHHQ6,,*DQG$UDELDQ&KHYURQ3KLOOLSV3HWURFKHPLFDO&R/WG
,Q2FWREHU6,,*FRQGXFWHGDPRQWKORQJPDLQWHQDQFHZRUNVDWLWV
EHQ]HQHF\FORKH[DQHDQGPRWRUJDVROLQHSURGXFLQJXQLWV
VALUATION MULTIPLES
3([
09A
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
SHARE PRICE PERFORMANCE
2008
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0D\
6HS
7$6,
0D\
-DQ
6,,*5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
3XEOLF3HQVLRQ$XWKRULW\33$
$OL$EGXOODK,EUDKLP$O-DIDO\
6RXUFH7DGDZXO1&%&5HVHDUFK
52
3(752&+(0,&$/6~0$<
$'9$1&('3(752&+(0
$/62.12:1$6$33&
Advanced Petrochemical Company (APPC) was established in
2005. It developed a SR2.9bn integrated propane
dehydrogenation and polypropylene complex in Jubail
Industrial City. The facility has an annual production capacity
of 450k mt of polypropylene. It commenced commercial
operations in 2008.
x Business brief
NOT COVERED
Current price (SR)
3ULFLQJDVRI
$33&KDVDQDQQXDOSURGXFWLRQFDSDFLW\RINPWRISRO\SURS\OHQHZKLFK STOCK DETAILS
LVXVHGLQVHYHUDODSSOLFDWLRQVVXFKDVPDQXIDFWXULQJRIIDEULFVPROGLQJV
ZHHNUDQJH+/65
SLSHVDQGIXUQLWXUH$33&RSHUDWHVDSURS\OHQHSODQWZLWKDFDSDFLW\RI
0DUNHWFDSPQ
NPWSDE\XVLQJ&$72),1$%%/XPXVWHFKQRORJ\ZKLFKFRQYHUWV
6KDUHVRXWVWDQGLQJPQ
SURSDQHJDVLQWRSURS\OHQH7KHFRPSDQ\DSSRLQWHG9LQPDU,QWHUQDWLRQDO
Price perform (%) 1M
/LPLWHG0LWVXELVKL&RUSRUDWLRQDQG'RPR19WRRIIWDNHWKHRXWSXWIURPWKH
$EVROXWH
FRPSOH[0RVWRIWKHSURGXFWLRQZRXOGEHVKLSSHGWKURXJKWKHSRUWVRI
0DUNHW
'DPPDP-HGGDKDQG-XEDLO
6HFWRU
x Financials
x Recent developments
6
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
12M P
$
0
6
SR
US$ A
0
0
5HXWHUVFRGH
6(5
%ORRPEHUJFRGH
$33&$%%
ZZZDGYDQFHGSHWURFKHPFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
7
)UHHIORDW
)
VALUATION MULTIPLES
09A
10A
3([
3
3%[
3
36[
3
'LY<LHOG
'
'36
'
11A
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
3M
0
2Q)HEUXDU\$33&¶VVKDUHKROGHUVDSSURYHGWKHGLVWULEXWLRQRID
ERQXVVKDUHIRUHYHU\VKDUHVKHOGWKHUHE\LQFUHDVLQJVKDUHFDSLWDOE\
ZLWKWKHDGGLWLRQRIPQVKDUHV,Q-DQXDU\,QGLDGHFLGHGWR
ZLWKGUDZDQWLGXPSLQJGXWLHVWKDWZHUHOHYLHGRQ6DXGL$UDELDEDVHG
SRO\SURS\OHQHPDQXIDFWXUHUVLQFOXGLQJ$33&LQ1RYHPEHU,Q
2FWREHU$33&XQGHUWRRNPDLQWHQDQFHZRUNDWLWVSURS\OHQHSODQWIRU
GD\V$VSHUWKHFRPSDQ\WKHVKXWGRZQKDGOLPLWHGLPSDFWRQ4
HDUQLQJVDV$33&PHWFXVWRPHURUGHUVXVLQJLQYHQWRULHV
Avg daily turnover (mn)
$33&¶VUHYHQXHJUHZ<R<WR65PQLQFRPSDUHGWR
65PQLQGXHWRKLJKHUSRO\SURS\OHQHSULFHV7KLVFRXSOHGZLWK
UHGXFHGRSHUDWLQJDQGILQDQFLQJH[SHQVHVLQVXSSRUWHGWKHLQFUHDVHLQ
QHWLQFRPH<R<WR65PQ$33&¶VJURVVPDUJLQVVWRRGDW
LQXSIURPD\HDUDJR
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
26.0
2008
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
SHARE PRICE PERFORMANCE
0D\
$XJ
7$6,
1RY
)HE
0D\
$33&5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
1DWLRQDO3RO\SURS\OHQH&R
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
53
3(752&+(0,&$/6~0$<
5$%,*+5(),1,1*$1'
3(752&+(0,&$/
$/62.12:1$63(7525$%,*+
Rabigh Refining and Petrochemical Co. (PetroRabigh),
established in Rabigh in 2005, is a joint venture between
Saudi Aramco and -DSDQ¶VSumitomo Chemical. The US$10bn
project can produce 130 mn barrels (bbl) of refined products
and 2.4mn mt of petrochemical products annually.
x Business brief
NOT COVERED
Current price (SR)
21.9
3ULFLQJDVRI
$UDPFRLVH[SHFWHGWRVXSSO\NEDUUHOVRIFUXGHRLOPQFXELFIHHWPFI RIHWKDQHDQGDERXWNEDUUHOVRIEXWDQHRQDORQJWHUPDQGIL[HGSULFH
STOCK DETAILS
EDVLVWR3HWUR5DELJK6XPLWRPRSURYLGHVWKHWHFKQRORJLFDODQGPDUNHWLQJ
ZHHNUDQJH+/65
0DUNHWFDSPQ
H[SHUWLVH7KHSODQWLVHTXLSSHGZLWKDVRSKLVWLFDWHG+LJK2OHILQV)OXLG
6KDUHVRXWVWDQGLQJPQ
&DWDO\WLF&UDFNHU+2)&&DQG(WKDQH&UDFNHU6DXGL$UDPFRLV
Price perform (%) 1M
UHVSRQVLEOHIRUPDUNHWLQJ3HWUR5DELJK¶VUHILQLQJSHWUROHXPSURGXFWVZKLOH
$EVROXWH
6XPLWRPRKDQGOHVWKHPDUNHWLQJRIWKHSHWURFKHPLFDOSURGXFWV3HWUR5DELJK
0DUNHW
LVSODQQLQJWRFRPPHQFHZRUNRQLWVSKDVH,,SURMHFWZKLFKZRXOGGRXEOHLWV
6HFWRU
FDSDFLW\E\
3M
Avg daily turnover (mn)
x Financials
'XULQJ3HWUR5DELJK¶VUHYHQXHVJUHZ<R<WR65EQZKLOH
QHWLQFRPHGURSSHG<R<WR65PQ1HWORVVHVLQFXUUHGGXULQJ
4DQG4GXHWRWKHSODQQHGPDLQWHQDQFHVKXWGRZQIURP$SULO
WR-XQHLPSDFWHGWKHFRPSDQ\¶VHDUQLQJVIRUWKH\HDU$QRQ
RSHUDWLQJQRQUHFXUULQJLQFRPHRI65PQIURPGHUHFRJQLWLRQRIOHDVHG
DVVHWVDQGUHODWHGOHDVHREOLJDWLRQVGXULQJIXUWKHUZLGHQHGWKH<R<
GURSLQQHWLQFRPH
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
3(7525$%
ZZZSHWURUDELJKFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
x Recent developments
2Q'HFHPEHU3HWUR5DELJKDQQRXQFHGWKHFRPSOHWLRQRIWKH
OHQGHUVUHOLDELOLW\WHVW/57DWDOOLWVSURGXFWLRQXQLWV7KHWHVWZKLFKHQWDLOHG
UXQQLQJWKHSHWURFKHPLFDOFRPSOH[DWDQRSHUDWLQJUDWHRIIRUGD\V
YDOLGDWHVLWVSURGXFWLRQVWDELOLW\DQGUHOLDELOLW\2Q'HFHPEHU
3HWUR5DELJKDQQRXQFHGWKHVXFFHVVIXOFRPSOHWLRQRIWKHSHUIRUPDQFH
JXDUDQWHHWHVWFRQGXFWHGDWLWV+LJK2OHILQV)OXLGL]HG&DWDO\WLF&UDFNLQJ
+2)&&XQLW
12M
VALUATION MULTIPLES
09A
3([
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
SHARE PRICE PERFORMANCE
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
2008
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
10
10
10
0D\
$XJ
7$6,
1RY
)HE
0D\
3HWUR5DELJK5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
6DXGL$UDELDQ2LO&RPSDQ\
$UDPFR
6XPLWRPR&KHPLFDO&RPSDQ\
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH=DZ\D7DGDZXO&RPSDQ\1&%&5HVHDUFK
54
3(752&+(0,&$/6~0$<
1$0$&+(0,&$/6
$/62.12:1$61$0$
Established in 1992, Nama Chemicals Company (NAMA)
develops, owns and operates industrial projects within the
chemical and petrochemical sectors. NAMA functions through
its affiliates Arabian Alkali Company (55k mtpa capacity) and
Jubail Chemical Industries Company (60k mtpa capacity).
x Business brief
NOT COVERED
Current price (SR)
18.4
3ULFLQJDVRI
$UDELDQ$ONDOLLVRQHRIWKHODUJHVWFDXVWLFVRGDSURGXFHUVLQWKH0LGGOH(DVW -XEDLO&KHPLFDO,QGXVWULHV-$1$SURGXFHVHSR[\UHVLQVDQGPDUNHWVWKHP STOCK DETAILS
XQGHUWKHEUDQGQDPHV5$=((1DQG$5$/',7(1$0$VHWXSWKH+DVVDG ZHHNUDQJH+/65
0DUNHWFDSPQ
3HWURFKHPLFDO&RPSDQ\LQZKLFKPDQXIDFWXUHVGLIIHUHQWW\SHVRI
6KDUHVRXWVWDQGLQJPQ
FKHPLFDOVWRVXSSO\IHHGVWRFNWRERWKRILWVVXEVLGLDULHV
Price perform (%)
x Financials
1$0$¶VUHYHQXHVJUHZ<R<WR65PQLQEXWLWSRVWHGDQHW
ORVVRI65PQQHWLQFRPHRI65PQLQGXHWRKLJKHUUDZ
PDWHULDOFRVWVUHGXFHGVHOOLQJSULFHVKLJKHUILQDQFLQJDQGGHSUHFLDWLRQ
UHODWHGFRVWDVZHOODVDQDGGLWLRQDOH[SHQVHRI65PQLQ:HDN
JOREDOGHPDQGIRUSHWURFKHPLFDOSURGXFWVPDLQO\LQ(XURSHLPSDFWHG
VHOOLQJSULFHVDQG1$0$¶VRSHUDWLQJUDWHLQ4
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
x Recent developments
6(
%ORRPEHUJFRGH
2Q0DUFK1$0$¶VVXEVLGLDU\-$1$REWDLQHG65PQLQGHEW
IURPWKH6,')WRIXQGWKHKLNHLQFRVWRILWV+DVVDGSURMHFW2Q)HEUXDU\
-$1$VLJQHGDQDJUHHPHQWZLWKWKH5R\DO&RPPLVVLRQRI-XEDLO
<DQEXWRXVHODQGIRUFRQVWUXFWLQJDIDFLOLW\SURGXFLQJHSR[\UHVLQVFDXVWLF
VRGDDQGFDOFLXPFKORULGH2Q-DQXDU\1$0$DQQRXQFHGWKDWLW
ZRXOGLQFUHDVHLWVHSR[\UHVLQVFDSDFLW\WRNPWSDIURPWKHFXUUHQWN
PWSDE\LQYHVWLQJ65PQ7ULDOUXQVDUHVFKHGXOHGWRVWDUWLQ42Q
-DQXDU\1$0$DQQRXQFHGWKDWLWVWDUWHGWULDOUXQVDWLWVFKORULGHSODQW
DQGWKHIDFLOLW\LVH[SHFWHGWRUHDFKIXOOFDSDFLW\E\42Q-DQXDU\
0U)DKHG5DFKHG0RKDPPDG$O2WDLELUHSODFHG0U$EGXOUDKPDQ
$EGXOODK$O+DPPDGDV1$0$¶V&(2
1$0$$%
ZZZQDPDFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH=DZ\D7DGZXO&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
10
10
CAGR (%)
(08-11)
10
10
0D\ $XJ
7$6,
1RY )HE 0D\
1$0$5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
$KPHG+DPDG$O*RVDLEL&R
6RXUFH7DGDZXO1&%&5HVHDUFK
55
3(752&+(0,&$/6~0$<
$/8-$,1&25325$7,21
$/62.12:1$6$/8-$,1
Alujain Corporation (Alujain), an industrial investment firm,
was established in 1991 and promoted by Xenel Industries
(one of the oldest conglomerates in the Kingdom). The
FRPSDQ\¶VLQYHVWPHQWVLQFOXGHDVWDNHLQ1DWLRQDO
Petrochemical Co. (NatPet) and a 100% stake in Arab
Pesticide Co. (MOBEED).
NOT COVERED
Current price (SR)
3ULFLQJDVRI
x Business brief
$OXMDLQSUHGRPLQDQWO\LQYHVWVLQWKH6DXGLSHWURFKHPLFDOHQHUJ\PLQLQJDQG STOCK DETAILS
ZHHNUDQJH+/65
PHWDOVVHFWRUV7KHFRPSDQ\WUDQVIHUUHGLWV$OIDVHOSURS\OHQHSURGXFWLRQ
0DUNHWFDSPQ
IDFLOLW\WRWKH7HOGHQHSRO\SURS\OHQHSURMHFWSURPRWHGE\LWVDVVRFLDWH
6KDUHVRXWVWDQGLQJPQ
1DW3HWLQ0D\1DW3HWRZQVD65EQSURS\OHQHDQGSRO\SURS\OHQH
Price perform (%) 1M
SODQWZLWKDNPWSDFDSDFLW\7KHFRPSDQ\VLJQHGDFRQWUDFWZLWK1REOH
$EVROXWH
*URXSIRUWKHRIIWDNHRILWVSURGXFWLRQ
x Financials
,Q$OXMDLQUHSRUWHGUHYHQXHVRI65PQLQGLFDWLQJD<R<JURZWKRI
GULYHQE\WKHIXOO\HDUFRQWULEXWLRQIURPLWVVXEVLGLDU\1DW3HWZKLFK
VWDUWHGFRPPHUFLDORSHUDWLRQVRQ$XJXVW+RZHYHULWUHSRUWHGQHW
ORVVRI65PQLQQHWSURILWRI65PQLQGXHWRORZHU
SURGXFWLRQYROXPHVKLJKHUIHHGVWRFNFRVWLQFUHDVHGLQWHUHVWH[SHQVHLQ
4DQGD65PQH[SHQVHUHODWHGWRDZULWHRIIRIDVXEVLGLDU\¶VSURMHFW
GHYHORSPHQWFRVWLQ4$QXQSODQQHGVKXWGRZQRIGD\VLQ4DQG
SODQQHGWXUQDURXQGZRUNIRUGD\VLQ4ORZHUHGYROXPHVLQ
2Q2FWREHU$OXMDLQDQQRXQFHGWKDWLWV1DWSHWFRPSOH[UHVXPHG
RSHUDWLRQVDIWHUDQXQSODQQHGFORVXUHRQ6HSWHPEHUFDXVHGE\D
WHFKQLFDOLVVXHDWWKHGHK\GURJHQDWLRQXQLW2Q-XQH$OXMDLQ
DQQRXQFHGWKDWWKH1DWSHWFRPSOH[UHVXPHGRSHUDWLRQVDWLWVSODQWVDIWHU
FRQGXFWLQJSURFHVVDQGPDFKLQHU\HQKDQFHPHQWZRUNIRUDSHULRGRI
GD\V$OXMDLQILQLVKHGWKHWXUQDURXQGZRUNGD\VEHIRUHVFKHGXOH
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$/&2$%
ZZZDOXMDLQFRUSRUDWLRQFRP
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
3([
3%[
36[
'LY<LHOG
'36
11A
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
WEIGHTING & FREEFLOAT (%)
x Recent developments
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
19.0
2008
6RXUFH=DZ\D7DGDZXO&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
10
10
CAGR (%)
(08-11)
10
10
10
10
SHARE PRICE PERFORMANCE
0D\ $XJ
7$6,
1RY )HE 0D\
$/&25+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
6DIUD&R
.KDOLG$EGXO5DKPDQ6DOHK$O
5DMKL
6RXUFH7DGDZXO1&%&5HVHDUFK
56
3(752&+(0,&$/6~0$<
0(7+$12/&+(0,&$/6
$/62.12:1$6&+(0$12/
Established in 1989, Methanol Chemicals Company
(Chemanol) is a manufacturer of methanol, formaldehyde and
its derivatives, including urea formaldehyde, acetaldehyde,
hexamine, resins and super plasticizers. The company
exports around 83% of products to more than 50 countries,
including the UK, France, Germany, South Africa, the US,
Canada, and Japan.
x
NOT COVERED
Current price (SR)
3ULFLQJDVRI
STOCK DETAILS
Business brief
ZHHNUDQJH+/65
&KHPDQROSURGXFHVDQGVXSSOLHVPHWKDQROIRUPDOGHK\GHDQGLWVGHULYDWLYHV 0DUNHWFDSPQ
IRUXVHDFURVVLQGXVWULHVVXFKDVDJULFXOWXUDOSKDUPDFHXWLFDOSDSHU
6KDUHVRXWVWDQGLQJPQ
PDQXIDFWXULQJDQGFRQVWUXFWLRQ7KHFRPSDQ\KDGLWV,QLWLDO3XEOLF2IIHULQJ
Price perform (%) 1M
,32RQWKH6DXGL6WRFN([FKDQJHLQ$XJXVWWRILQDQFHDQH[SDQVLRQ
$EVROXWH
SODQLQYROYLQJDURXQG65EQLQYHVWPHQW
x Financials
&KHPDQRO¶VUHYHQXHVJUHZWR65PQLQ65PQLQZKLOH
QHWLQFRPHLQFUHDVHGWR65PQIURP65PQ7KLVZDVGXHWRKLJKHU
VHOOLQJSULFHVDQGVDOHVYROXPHVDORQJZLWKLPSURYHGRSHUDWLRQDOHIILFLHQF\
(DUQLQJVIRUEHQHILWHGIURPWKHIXOO\HDUFRQWULEXWLRQPDGHE\WKH
GLPHWK\OIRUPDPLGHSODQWVWDUWHGFRPPHUFLDORSHUDWLRQVRQ-XQH
x Recent developments
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
&+(0$12/$%
ZZZFKHPDQROFRP
&KHPDQROFRQGXFWHGWHFKQLFDOHQKDQFHPHQWZRUNVDWLWVPHWKDQRODQG
GLPHWK\OIRUPDPLGHSODQWVGXULQJ±2FWREHUWRLPSURYHWKHLU
HIILFLHQF\DQGSURGXFWLYLW\2Q-XQHLWVHFXUHGD0XUDEDKD
UHILQDQFLQJIDFLOLW\LQZKLFK6$%%5L\DGK%DQNDQG6DPEDSDUWLFLSDWHGRI
65PQWRIXQGFRVWRYHUUXQVDQGZRUNLQJFDSLWDOQHHGV,WZRXOGEH
UHSDLGLQVHPLDQQXDOLQVWDOOPHQWVVWDUWLQJIURP-XO\WR
'HFHPEHU2Q0D\&KHPDQRODQG6DKDUDVLJQHGD0R8WR
EXLOGDNPWSDQHRSHQW\OJO\FROSODQWHVWLPDWHGWRFRVW65PQ
&KHPDQROZRXOGKROGVWDNHLQLWDQGSURYLGHIRUPDOGHK\GHNH\
IHHGVWRFNWRWKLVIDFLOLW\7KHSURMHFWLVVFKHGXOHGWREHFRPSOHWHGE\4
17.1
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
3([
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH=DZ\D7DGDZXO&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0D\ $XJ 1RY
7$6,
)HE 0D\
&KHPDQRO5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
<XVXI%LQ$KPHG.DQRR&R/WG
=DPLO*URXS+ROGLQJ&R
0RKDPPHG-DODO6RQV&R
6RXUFH7DGDZXO1&%&5HVHDUFK
57
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Cement
Ticker
Company
Page No.
3030
Saudi Cement
64
3020
Yamamah Cement
65
3050
Southern Cement
66
3040
Qassim Cement
67
3080
Eastern Cement
68
3060
Yanbu Cement
69
3010
Arabian Cement
70
3091
Al Jouf Cement
71
3090
Tabuk Cement
72
3001
Hail Cement
73
0$<
&(0(17
*RYHUQPHQWVSHQGLQJNH\WRSURVSHFWLYHJURZWK
.6$¶VFHPHQWVHFWRUH[SDQGHGVLJQLILFDQWO\LQDIWHUWKUHH
\HDUVRIQHJDWLYHDQGZHDNSHUIRUPDQFH:HH[SHFWGHPDQGWR
FRQWLQXHWREHVWURQJLQGULYHQE\UREXVWH[SHQGLWXUHE\WKH
JRYHUQPHQWRQLQIUDVWUXFWXUHSURMHFWVDQGKRXVLQJ:HHVWLPDWH
GHPDQGIRUFHPHQWWRJURZWRPQWRQVLQDQG
LQ
&HPHQWVDOHVDUHHVWLPDWHGWRLQFUHDVHDWD&$*5RIXQWLOGULYHQ
SULPDULO\E\LQFUHDVHGJRYHUQPHQWVSHQGLQJRQLQIUDVWUXFWXUHDQGKRXVLQJLQWKH
PHGLXPWHUP$VSHURXUHVWLPDWHVJRYHUQPHQWVSHQGLQJLQZLOOEH
KLJKHUWKDQEXGJHWHGDW65EQLQDGGLWLRQWRWKH65EQDOORFDWHGWREXLOG
KRXVLQJXQLWV$GGLWLRQDOO\WKHYDOXHRIFRQVWUXFWLRQFRQWUDFWVDZDUGHG
LQ6DXGL$UDELDURVH<R<WR65EQLQZLWKQHDUO\DZDUGHG
GXULQJWKHVHFRQGKDOIRIWKH\HDU
$QRWKHUNH\WUHQGLQWKHVHFWRULVWKHVKLIWLQORFDOGHPDQGIURPWKHFHQWUDOWRWKH
ZHVWHUQUHJLRQGXHWRWKHJRYHUQPHQW¶VUHGHYHORSPHQWSURMHFWV)XUWKHUPRUH
WKHZHVWHUQUHJLRQLVQRZWKHFHQWHURIPHJDSURMHFWGHYHORSPHQWVLQFOXGLQJWKH
+DUDPDLQ5DLOZD\-HGGDK¶VQHZDLUSRUWPDMRUGUDLQDJHDQGRWKHU
LQIUDVWUXFWXUHZRUNV
,QWKH6DXGLFHPHQWVHFWRUKDGDFDSDFLW\RIPQWRQVZKLOHGHPDQG
WRWDOHGPQWRQV&RQVLGHULQJWKHH[SHFWHGJURZWKLQGHPDQGWKHFRXQWU\LV
OLNHO\WRZLWQHVVDGHPDQGVXSSO\JDSHVSHFLDOO\LQWKHZHVWHUQUHJLRQ
+RZHYHURQWKHEDFNRIIWKHJRYHUQPHQW¶VUHFHQWLQWHUYHQWLRQWRDLGVXSSO\ZH
EHOLHYHSULFHVDUHOLNHO\WRVWDELOL]HLQWKHQHDUWHUPFORVHWRFHLOLQJOHYHOV,Q
WKHPHGLXPWHUPWKHKHDOWK\GHPDQGRXWORRNVKRXOGSURYLGHVWURQJSULFLQJ
VXSSRUW0RUHRYHULQ)HEUXDU\WKH6DXGLJRYHUQPHQWLPSRVHGDEDQRQ
WKHH[SRUWRIFOLQNHUDQGFHPHQWH[SRUWVFRQVWLWXWHGRIWRWDOFHPHQWVDOHVLQ
)XHO±.H\FDWDO\VWLQWKHQHDUWHUP
7KHUHFHQWIXHODOORFDWLRQVDUHOLNHO\WRWHPSRUDULO\EHQHILWVHYHUDOFRPSDQLHV
LQFOXGLQJ<DQEX&HPHQWPQWRQVQHZOLQHFDSDFLW\DQG6RXWKHUQ&HPHQW
PQWRQVQHZOLQHFDSDFLW\LQWKHVKRUWWHUP+RZHYHUXQFHUWDLQIXHOVXSSO\LV
H[SHFWHGWREHWKHPDLQFRQVWUDLQWRQFHPHQWFDSDFLW\DGGLWLRQRYHUWKHORQJ
WHUP7KHJRYHUQPHQWVHWXSDFRPPLWWHHWRDQDO\]HDQGIRUHFDVWGHPDQGRI
FHPHQW7KHFRPPLWWHHLVUHTXLUHGWRUHSRUWLWVVXJJHVWLRQVZLWKLQVL[PRQWKV
ZKHQWKHFXUUHQWRUGHUDSSURYLQJIXHOVXSSO\HQGV
59
&(0(17
1&%&$3,7$/
0$<
Exhibit 51: Clinker stock per company
Exhibit 52: Cement stock per company
µWRQV
µWRQV
<DPDPD 6DX GL
&HPHQW &HPHQW
(DVWHUQ
&HPHQW
)HE
4DVVLP
&HPHQW
<DQ EX
&HPHQW
0DU
<DPDPD 6DX GL
&HPHQW &HPHQW
$UD ELDQ 6RX WKH UQ 7DEXN
&HPHQW &HPHQW &HPHQW
(DVWHUQ
&HPHQW
4DVVLP
&HPHQW
)HE
$SU <DQ EX
&HPHQW
0DU
$UD ELDQ 6RX WKH UQ 7DEXN
&HPHQW &HPHQW &HPHQW
$SU 6RXUFH<DPDPDK&HPHQW1&%&5HVHDUFK
6RXUFH<DPDPDK&HPHQW1&%&5HVHDUFK
,QWULQVLFFRVWDGYDQWDJHVFRPSDUHGWRRWKHU*&&SOD\HUV
6DXGLFHPHQWFRPSDQLHVSRVWLPSUHVVLYHUHWXUQVFRPSDUHGWRWKHLU*&&SHHUV
SULPDULO\GXHWRVLJQLILFDQWFRVWDGYDQWDJHV&HPHQWFRPSDQLHVLQ.6$KDYH
DFFHVVWROLPHVWRQHTXDUULHVXQGHUOLFHQVHVJUDQWHGE\WKHJRYHUQPHQW
)XUWKHUPRUHLQ.6$WKHFRVWRIQDWXUDOJDVRLOZKLFKLVXVHGDVIXHOE\FHPHQW
SODQWVDQGLVDPDMRUFRPSRQHQWRIDFHPHQWILUP¶VRYHUDOOH[SHQVHVLVORZ
&RQVHTXHQWO\WKHFRVWRISURGXFWLRQIRU.6$EDVHGFRPSDQLHVLVPXFKORZHUWKDQ
WKDWIRURWKHU*&&DQGJOREDOSOD\HUV7KXVDYHUDJHJURVVPDUJLQIRU6DXGLFHPHQW
FRPSDQLHVZDVDURXQGLQUHODWLYHWRWKH*&&DYHUDJHRI7KH
DYHUDJHFRVWRIFHPHQWSHUWRQLQFUHDVHGPDUJLQDOO\WR65WRQLQ
Exhibit 53: Gross margin, 2011
Exhibit 54: Comparison of ROE and P/E of GCC cos,
2011
52(
3([
.6$
.XZDLW
2PDQ
4DWDU
8$(
.6$
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
.XZDLW
2PDQ
4DWDU
8$(
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK7KHPNWFDSRIEXEEOHLVDVRQ$SU¶
7KHVHFWRUIDUHVZHOORQD52(EDVLVDVZHOODVDWWUDFWLYH3(PXOWLSOHVFRPSDUHG
WRRWKHUFRXQWULHVLQWKH*&&:LWKWKHHQOLVWPHQWRI+DLO&HPHQW&RPSDQ\LQ
WKHUHDUHFXUUHQWO\WHQOLVWHGFHPHQWSOD\HUVRQWKH7DGDZXO,QGH[
Exhibit 55: Sector details
8QLWVDVVWDWHG
Country
% weight in Index
as on Mar 2011
6DXGL&HPHQW&R
<DPDPD6DXGL&HPHQW&R
<DQEX&HPHQW&R
6RXWKHUQ3URYLQFH&HPHQW&R
$UDELDQ&HPHQW&R
4DVVLP&HPHQW&R
(DVWHUQ3URYLQFH&HPHQW&R
7DEXN&HPHQW&R
$O-RXI&HPHQW
Net margin
(%), 2011
ROE
(%) 2011
Div. Yield
(%) 2011
1$
1$
1$
6RXUFH%ORRPEHUJ7DGDZXO&RPSDQ\GDWD1&%&5HVHDUFK
60
&(0(17
1&%&$3,7$/
0$<
&HPHQWSURGXFWLRQLQ.6$JUHZ<R<WRPWZKHUHDVWKHWRWDOFHPHQW
DQGFOLQNHUVDOHVYROXPHLQFUHDVHG<R<WRPWGXULQJGULYHQE\
LQFUHDVHGFRQVWUXFWLRQDFWLYLW\6RXWKHUQ&HPHQWUHSRUWHGWKHVWURQJHVWVDOHV
YROXPHJURZWKXSDQG(DVWHUQFHPHQWZDVZHDNHVWZLWKYROXPHV
GHFOLQLQJE\<R<7KHIRXUXQOLVWHGSULYDWHFRPSDQLHVWRWDOVDOHVYROXPH
LQFUHDVHGE\WRPQWRQVLQ
7KHUHYHQXHVRI.6$¶VQLQHOLVWHGFHPHQWFRPSDQLHVLQFUHDVHGE\<R<LQ
WR65EQ$SDUWIURP-RXIFHPHQWZKLFKWULSOHGWKHUHYHQXHVDVLWV
IDFWRU\UHDFKHGIXOOSURGXFWLRQ$UDELDQ&HPHQWUHSRUWHGWKHVWURQJHVWJURZWKRI
<R<ZLWK(DVWHUQFHPHQWUHSRUWLQJWKHZHDNHVWZLWKUHYHQXHVGHFOLQLQJE\
<R<7KHDYHUDJH1HWLQFRPHPDUJLQRIWKHVHFWRULPSURYHGESVWR
LQ
3ULFHVWRUHPDLQQHDUFHLOLQJOHYHOV
)ROORZLQJLWVGLUHFWLYHRQIXHOVXSSO\LQ0DUFKWKH.6$JRYHUQPHQW
UHGXFHGWKHSULFHFDSRIFHPHQWIURP65WRQWR65WRQ3ULRUWRWKLV
FHPHQWSULFHVLQWKHZHVWHUQUHJLRQZHUHFORVHWRWKHWKHQJRYHUQPHQWVHW
FHLOLQJRI65WRQZKLOHWKRVHLQWKHHDVWHUQUHJLRQZHUHPDUJLQDOO\ORZHUDW
65WRQ+RZHYHUDPLGLQFUHDVHGPRQLWRULQJE\WKHJRYHUQPHQWDOO
FRPSDQLHVVWDUWHGVHOOLQJFHPHQWDW65WRQVLQFH0DUFK
7KHFRQWLQXHGSULFLQJSUHVVXUHWKDWZHKDYHVHHQLQODVWIHZ\HDUVKDVVWDOOHG
7KHDYHUDJHSULFHRIFHPHQWSHUWRQJUHZVLJQLILFDQWO\XSWR65LQ
DIWHUIDOOLQJWR65LQIURP65LQDQG65LQ
'XHWRWKLVWKHVHFWRU¶VDGMXVWHGQHWSURILWLQFUHDVHGWR65EQLQ
$UDELDQ&HPHQWDPRQJWKHOLVWHGFRPSDQLHVUHSRUWHGWKHKLJKHVWDYHUDJHSULFH
DW65WRQLQ
Exhibit 56: Price/Cost of cement per ton
Exhibit 57: Net profit for the sector, 2008±11
65SHUWRQ
4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 65PQ
$YHUDJ H&RVWSH UWRQ
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
$YHUDJ H3 ULFH S HUWRQ 5+6
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
5HDVRQDEOHYDOXDWLRQV
7KHVHFWRU¶V3(DQG3%9PXOWLSOHFXUUHQWO\VWDQGVDW[DQG[
UHVSHFWLYHO\YHUVXV[DQG[IRUWKHRYHUDOO*&&FHPHQWPDUNHW:KLOH
6RXWKHUQ&HPHQWUHSRUWHGWKHKLJKHVW5R(VRIDURXQG$O-RXI&HPHQW
UHSRUWHGWKHORZHVW5R(LQWKHLQGXVWU\DWIRU
61
&(0(17
1&%&$3,7$/
0$<
Exhibit 58: Comparison of P/B and ROE, 2010
Exhibit 59: Comparison of P/B and ROE, 2011
52(
52(
3%9[
6DXGL&HPHQW
<DQEX&HPHQW
$UDELDQ&HPHQW
<DPDPDK&HPHQW
4DVVLP&HPHQW
7DEXN&HPHQW
3%9[
6DXGL&HPHQW
<DQEX&HPHQW
$UDELDQ&HPHQW
6RXWKHUQ3URYLQFH
(DVWHUQ3URYLQFH
$/-RXI&HPHQW
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
<DPDPDK&HPHQW
4DVVLP&HPHQW
7DEXN&HPHQW
6RXWKHUQ3URYLQFH
(DVWHUQ3URYLQFH
$/-RXI&HPHQW
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
$YHUDJHGDLO\WXUQRYHUIRUWKHVHFWRUVWRRGDW65PQSHUGD\LQXSIURP
65PQSHUGD\LQ$UDELDQ&HPHQWKDGWKHKLJKHVWDYHUDJHGDLO\
WXUQRYHUDW65PQLQIROORZHGE\6DXGL&HPHQWDW65PQ
Exhibit 60: Average daily turnover, Jan±Dec 11
Exhibit 61: Share price movement, Jan±Dec 11
65PQ
5HEDVHGWRRQVW-DQ
-DQ
$UDELDQ
6DXGL <DPDPD 4DVVLP (DVWHUQ 7DEXN
<DQEX 6RXWKHUQ
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
0DU
0D\
$XJ
2FW
<DPDPD
6DXGL
(DVWHUQ
4DVVLP
$UDELDQ
6RXWKHUQ
7DEXN
$O-RXI
'HF
<DQEX
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
1&%&5HFRPPHQGDWLRQVLQWKH6HFWRU
$OWKRXJKWKHGHPDQGRXWORRNIRUWKHVHFWRUUHPDLQVEXOOLVKGXHWRVWURQJ
JRYHUQPHQWVSHQGLQJRQLQIUDVWUXFWXUHDQGKRXVLQJZHUHPDLQ1HXWUDOIRUWKH
VHFWRUDVDZKROHDVZHEHOLHYHWKHSRVLWLYHRXWORRNLVFXUUHQWO\SULFHGLQ,QWKH
FXUUHQWHQYLURQPHQWZHEHOLHYHFRPSDQLHVZLWKH[FHVVVWRFNFDSDFLW\DVZHOO
DVLQFORVHSUR[LPLW\WRNH\GHPDQGSRLQWVJUDGXDOO\VKLIWLQJWRWKHZHVWHUQ
UHJLRQVWDQGWREHQHILWWKHPRVW&XUUHQWO\ZHKDYHVL[VWRFNVXQGHURXU
FRYHUDJH<DPDPD&HPHQW(DVWHUQ&HPHQW<DQEX&HPHQW6DXGL&HPHQW
6RXWKHUQ&HPHQWDQG4DVVLP&HPHQW
62
&(0(17
1&%&$3,7$/
0$<
Exhibit 62: Coverage stocks details
Stock
Current
Rating
PT (SR)
<DPDPDK&HPHQW1HXWUDO
6(
(DVWHUQ&HPHQW
6(
1HXWUDO
<DQEX&HPHQW
6(
1HXWUDO
6DXGL&HPHQW
6(
1HXWUDO
6RXWKHUQ&HPHQW 1HXWUDO
6(
4DVVLP&HPHQW1HXWUDO
6(
Comments
6WURQJGHPDQGLQ5L\DGKDQGWKHDELOLW\WRVHOOLQGLIIHUHQWUHJLRQVDUHWKHPDLQ
DGYDQWDJHV+RZHYHUKLJKXWLOL]DWLRQUDWHDQGGHFOLQLQJVWRFNOHYHODUHWKHNH\
QHJDWLYHV
6KLIWLQJIRFXVWRGRPHVWLFPDUNHWGXHWRH[SRUWEXWOLPLWDWLRQRQH[SRUWVUHPDLQVNH\
GRZQVLGH6WLOOIRFXVHGRQ(DVWHUQUHJLRQIRUVDOHV
'HPDQGVKLIWIURP&HQWUDOWRWKHZHVWHUQUHJLRQLVNH\DGYDQWDJH7KHFRPSDQ\LV
ORFDWHGFORVHWRWKHUHJLRQ¶VPDLQSURMHFWV,QDGGLWLRQLWKDVDQHZOLQHRIPQWRQV
%DVHGLQWKH(DVWHUQUHJLRQDZD\IURPPRVWRIWKHNH\GHPDQGFHQWHUV+RZHYHU,WV
KLJKVWRFNOHYHOH[FHVVFDSDFLW\DQGUHRSHUDWLQJLWVROGOLQHVDUHSRVLWLYHV
:HOOSRVLWLRQHGIRU-L]DQ(FRQRPLF&LW\LQWKH6RXWK1HZIDFLOLW\QHDU0DNNDKZLWK
PQWRQVVKRXOGDOVRKHOS+LJKVWRFNOHYHODQGH[FHVVFDSDFLW\VXSSRUWVWKHRXWORRN
/RZHVWFRVWFHPHQWSURGXFHULQWKHFRXQWU\ZLWKYHU\ORZLQYHQWRU\OHYHOV/DFNRI
FDSDFLW\H[SDQVLRQSODQVFRXOGOLPLWJURZWK
6RXUFH1&%&5HVHDUFK
63
&(0(17~0$<
6$8',&(0(17
$/62.12:1$66&&
6DXGL&HPHQW&RPSDQ\6&&LVRQHRIWKHODUJHVWFHPHQW
FRPSDQLHVLQ6DXGL$UDELD$ORZFRVWEDVHJLYHQLWV
UHODWLYHO\QHZSURGXFWLRQOLQHVDORQJZLWKKLJKVWRFNOHYHOV
DUHWKHFRPSDQ\¶VNH\VWUHQJWKV$GGLWLRQDOO\WKHUHVXPSWLRQ
RIRSHUDWLRQVLQLWVROGOLQHVDQGWKHVHOOLQJRIFOLQNHUVWRFNV
DUHNH\DGYDQWDJHVLQWKHQHDUWHUP
x %XVLQHVVEULHI
1(875$/
&XUUHQWSULFH65 3ULFLQJDVRI
6&&ZDVHVWDEOLVKHGLQDQGVSHFLDOL]HVLQWKHSURGXFWLRQRIRUGLQDU\
672&.'(7$,/6
3RUWODQGFHPHQWVXOSKDWHUHVLVWDQWFHPHQWDQGRLOZHOOFHPHQW6&&ZKLFK ZHHNUDQJH+/65
KDVWKHODUJHVWSURGXFWLRQFDSDFLW\PQWRQVRIFHPHQW\HDULQ6DXGL
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
ZRXOGIXUWKHULQFUHDVHLWE\H[WUDWRWDOSURGXFWLRQRIWRQVGD\RQ
UHRSHQLQJWKHROGOLQHV6&&KDVEHHQORVLQJJURXQGLQWKHGRPHVWLFPDUNHW
3ULFHSHUIRUP 0
LQWKHSDVWIHZ\HDUVPDLQO\GXHWRFRPSHWLWLRQIURPQHZHQWUDQWV,Q
$EVROXWH
6&&KDGDPDUNHWVKDUHRIZKLFKKDVGHFOLQHGIURPLQ
0DUNHW
6&&KDVDHTXLW\VWDNHLQ8QLWHG&HPHQW&RPSDQ\%DKUDLQDQG
6HFWRU
DQRWKHULQ&HPHQW3URGXFW,QGXVWU\&R/WG
$YJGDLO\WXUQRYHUPQ
x )LQDQFLDOV
5HYHQXHVJUHZ<R<WR65PQLQDWWULEXWHGWRJURZWKLQ
VDOHVYROXPHLQWKHEDFNGURSRILQFUHDVHGGHPDQGIURPWKHORFDOPDUNHW
FRPELQHGZLWK<R<LQFUHDVHLQSULFHV(%,7'$LQFUHDVHGWR
65PQGXHWRORZHUFRVWVDVDUHVXOWRIHIILFLHQF\JDLQVIURPWKHQHZ
SURGXFWLRQOLQHV&RQVHTXHQWO\QHWSURILWRIWKH\HDUDOVRURVHWR
65PQ
x 5HFHQWGHYHORSPHQWV
0
0
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6$&&2$%
ZZZVDXGLFHPHQWFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
2Q0DUFK6&&DSSURYHGWKHGLVWULEXWLRQRI65SHUVKDUHFDVK
GLYLGHQGIRUWKH+FKDQJLQJWKHIXOO\HDUGLYLGHQGWR65SHUVKDUH
)XUWKHUPRUHRQ)HEUXDU\WKHFRPSDQ\VLJQHGDQDJUHHPHQWWR
VHOOWRQVRIFOLQNHUWR$UDELDQDQG4DVVLP&HPHQW)LQDOO\RQ
)HEUXDU\WKHFRPSDQ\DQQRXQFHGWKHUHRSHQLQJRIIRXURILWV
SURGXFWLRQOLQHVZLWKDFDSDFLW\RIFOLQNHUWRQVGD\E\0D\
9$/8$7,2108/7,3/(6
$
$
(
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
6DXGL&HPHQW5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
.KDOLG$EGXO5DKPDQ6DOHK$O5DMKL 3XEOLF3HQVLRQ$XWKRULW\33$
6RXUFH7DGDZXO1&%&5HVHDUFK
64
CEMENT ~ MAY 2012
YAMAMA CEMENT
ALSO KNOWN AS: YSCC
Yamama Cement Company (YSCC), which is located in Riyadh
is one of the oldest and largest cement companies in Saudi
Arabia. Its stock level is the key advantage while the limited
excess capacity and the shift in demand to the western region
are the main concerns.
NEUTRAL
Current price (SR)
47.6
Pricing as of 09-05-2012
x Business brief
YSCC was founded in 1961 and is one of the largest cement companies in
Saudi Arabia with annual cement and clinker production capacities of 6.3mn
tons and 6.0mn tons, respectively. Based in Riyadh, YSCC is strategically
located to take advantage of the increased momentum of the construction
sector in 2011, particularly in the Central region. Although it has declined,
from 2009, YSCC maintains one of the highest cement market shares in the
country (12.2% in 2011 and 13.5% in 2009).
x Financials
In 2011<6&&¶VUHYHQXHs were up 13.4% YoY to SR1,442mn driven by
increased sales volume combined with a YoY increase in cement prices.
EBITDA grew 10.4% YoY to SR946mn, with net income up 12.6% YoY to
SR740mn driven largely by the top-line growth. However, net margin fell
slightly by 36bps YoY to 51.3% in 2011 from 51.6% in 2010 due to higher
SG&A expenses during the year.
STOCK DETAILS
52-week range H/L (SR)
57/37
Market cap ($ mn)
2,570
Shares outstanding (mn)
Price perform (%)
202
1M
3M
12M
Absolute
(3.1)
(6.1)
18.5
Market
(6.2)
6.2
7.6
Sector
(0.6)
6.9
33.2
Avg daily turnover (mn)
SR
US$
3M
36.1
9.6
12M
17.0
4.5
Reuters code
3020.SE
Bloomberg code
YACCO AB
www.yamamacement.com
x Recent developments
On February 26, 2012, YSCC approved the distribution of SR2 per share
cash dividend for the six month period ending December 31, 2011.
Additionally, on October 2011, the company announced the liquidation of its
holding in Sudani Kuwaiti Holding Company, where the compan\¶VVKDUHRI
liquidation amounted to SR13,975mn.
WEIGHTING & FREEFLOAT (%)
TASI (free float weight)
1.38
Free float
86.27
VALUATION MULTIPLES
10A
11A
12E
P/E (x)
14.7
13.0
11.4
P/B (x)
3.1
2.9
2.8
P/S (x)
7.6
6.7
5.8
Div Yield (%)
5.6
5.6
6.3
DPS
2.7
2.7
3.0
Source: NCBC Research estimates
Company financials
Revenues
EBITDA
Net Income
Assets
Equity
Total Debt
Cash & Equiv
EBITDA Mgn
Net Mgn
ROE
ROA
Div Payout
EPS
BVPS
SRmn
SRmn
SRmn
SRmn
SRmn
SRmn
SRmn
%
%
%
%
%
SR
SR
SHARE PRICE PERFORMANCE
2010
1,272
857
657
3,653
3,159
267
700
67.4
51.6
21.1
17.9
82.2
3.24
15.60
2011
1,442
946
740
3,822
3,375
190
898
65.6
51.3
22.7
19.8
73.0
3.65
16.67
2012E
1,672
1,039
846
3,874
3,409
190
1,000
62.1
50.6
24.9
22.0
71.8
4.18
16.83
2013E
1,687
1,049
856
3,831
3,453
98
1,053
62.2
50.8
24.9
22.2
76.9
4.23
17.05
YoY
(%)
13.4
10.4
12.6
4.6
6.8
(28.8)
28.3
12.6
6.8
CAGR (%)
(10-13E)
9.9
7.0
9.2
1.6
3.0
(28.4)
14.6
9.2
3.0
8,000
7,500
7,000
6,500
6,000
5,500
58
53
48
43
38
33
May-11
Sep-11
TASI
Jan-12
May-12
Yamamah Cement (RHS)
Source: Bloomberg
TOP 5 SHAREHOLDERS (%)
Prince Sultan M.S. Al Saud
General Org. for Social Insurance
Public Pension Agency (PPA)
9.7
7.8
5.3
Source: Tadawul, NCBC Research
Source: Tadawul, Company, NCBC Research
65
&(0(17~0$<
6287+(51&(0(17
$/62.12:1$663&&
6RXWKHUQ3URYLQFH&HPHQW&RPSDQ\63&&LV6DXGL$UDELD¶V
ODUJHVWFHPHQWSURGXFHULQWHUPVRIPDUNHWFDSLWDOL]DWLRQDQG
WKHVHFRQGODUJHVWLQWHUPVRIFDSDFLW\63&&¶VKLJKFDSDFLW\
DQGVWRFNOHYHOVZRXOGEHWWHUHQDEOHLWWRPHHWWKH
LQFUHPHQWDOLQFUHDVHLQGRPHVWLFGHPDQG
1(875$/
&XUUHQWSULFH
3ULFLQJDVRI
x %XVLQHVVEULHI
63&&ZDVVHWXSLQDQGRSHUDWHVSURGXFWLRQIDFLOLWLHVLQ-D]DQ%LVKD
DQG7XKDPDZLWKWKHEXONRIWKHSURGXFWLRQWDNLQJSODFHLQWKHILUVWWZR
672&.'(7$,/6
IDFLOLWLHV,WKDVDFHPHQWSURGXFWLRQFDSDFLW\RIPQWRQVSHU\HDU63&&¶V ZHHNUDQJH+/65
VKDUHLQWKHGRPHVWLFPDUNHWFRQWLQXHVWRGHFOLQHPDLQO\GXHWRULVLQJ
0DUNHWFDSPQ
FRPSHWLWLRQIURPVHYHUDOQHZSOD\HUVLQWKHLQGXVWU\,WVVKDUHKDVIDOOHQIURP 6KDUHVRXWVWDQGLQJPQ
LQWRLQ7KH3XEOLF,QYHVWPHQW)XQGRZQVD
3ULFHSHUIRUP 0
VWDNHLQWKHFRPSDQ\
$EVROXWH
x )LQDQFLDOV
5HYHQXHVLQFUHDVHG<R<WR65PQLQGXHWRLQFUHDVHG
VDOHVYROXPHDQGWKHLQFUHDVHLQSULFHV'ULYHQE\WKLV(%,7'$JUHZ
<R<WR65PQLQQHWLQFRPHLQFUHDVHG<R<WR65PQ
x 5HFHQWGHYHORSPHQWV
2Q0DUFK6RXWKHUQ&HPHQWDSSURYHGWKHGLVWULEXWLRQRI65SHU
VKDUHFDVKGLYLGHQGIRUWKHVHFRQGKDOIRI$GGLWLRQDOO\RQ0DUFK
WKHFRPSDQ\DQQRXQFHGWKHFRPPHQFHPHQWRIWKHFRPPHUFLDO
SURGXFWLRQDWLWVVHFRQGOLQHLQ7XKDPDSODQWRQ0DUFK:LWKWKLV
WKHWRWDOSURGXFWLRQFDSDFLW\IRUWKHWKUHHSODQWVZRXOGUHDFKWRQVRI
FOLQNHUGD\HTXDOLQJWRQVRIFHPHQWGD\
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
62&&2$%
ZZZVSFFFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
(
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
6RXWKHUQ&HPHQW5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
3XEOLF,QYHVWPHQW)XQG *HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
66
&(0(17~0$<
4$66,0&(0(17
$/62.12:1$64&&
4DVVLP&HPHQW&RPSDQ\4&&ZDVIRXQGHGLQLQ
%XUD\GDKZKLFKLVORFDWHGLQWKHFHQWUDOUHJLRQRI.6$$VRI
'HFHPEHU4&&KDGDWRWDOSURGXFWLRQFDSDFLW\RIPQ
WRQVRIFHPHQWDQGPQWRQVRIFOLQNHU4&&¶VKLJK
GLYLGHQG\LHOGUHPDLQVDNH\VWUHQJWKRIWKHFRPSDQ\KLJK
XWLOL]DWLRQUDWHVDQGORZLQYHQWRU\OHYHOVUHPDLQNH\FRQFHUQV
x %XVLQHVVEULHI
1(875$/
&XUUHQWSULFH65 3ULFLQJDVRI
4&&KHOGDVWHDG\VKDUHRIWKH.6$¶VFHPHQWPDUNHWIRUPDQ\\HDUV
KRZHYHUWKLVIHOOWRLQIURPLQOHGE\LQFUHDVHG
FRPSHWLWLRQIURPSULYDWHSOD\HUV1HYHUWKHOHVV4&&LVVWLOORQHRIWKHPRVW
HIILFLHQWFRPSDQLHVLQWKHGRPHVWLFFHPHQWVHFWRU,Q4&&SURGXFHG
FHPHQWDW65SHUWRQFRPSDUHGWRWKHLQGXVWU\DYHUDJHRI65SHU
WRQ+RZHYHULWLVH[SHFWHGWRLQFUHDVHWR65DVDUHVXOWRIEX\LQJ
FOLQNHUIURP6DXGL&HPHQW
x )LQDQFLDOV
4DVVLP¶VUHYHQXHVJUHZLQFRPSDUHGWRWKHGHFOLQHLQ
DWWULEXWDEOHWRKLJKHUVDOHVYROXPHDQGVWDEOHSULFHV'ULYHQE\WKLV(%,7'$
JUHZE\<R<WR65PQGXULQJWKH\HDU1HWSURILWDOVRLQFUHDVHGE\
<R<WR65PQLQOHGE\LPSURYHGRSHUDWLQJSHUIRUPDQFHRI
LWVVXEVLGLDU\FRPSDQLHV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
4$&&2$%
ZZZTFFFRPVD
x 5HFHQWGHYHORSPHQWV
2Q0DUFK4DVVLP&HPHQW&RPSDQ\DSSURYHGWKHGLVWULEXWLRQRI
65SHUVKDUHFDVKGLYLGHQGIRUWKHVHFRQGKDOIRI$GGLWLRQDOO\
DFFRUGLQJWRWKHORFDOSUHVV4&&LVLQYHVWLJDWLQJWKHSRVVLELOLW\RIRSHQLQJD
QHZOLQHRISURGXFWLRQ)LQDOO\RQ-DQXDU\WKHFRPSDQ\
DQQRXQFHGWKDWWKH\KDYHVXFFHVVIXOO\SHUIRUPHGDSURSRVDOVWXG\ZLWK
UHVSHFWWRWKHQHZSURGXFWLRQOLQHEXWUHFHLYHGDUHSO\IURP$UDPFRWKDWLW
ZRXOGQRWVXSSO\WKHIXHO
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
(
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
0D\
6HS
7$6,
-DQ
0D\
4DVVLP&HPHQW5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
3XEOLF,QYHVWPHQW)XQG
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
3XEOLF3HQVLRQ$XWKRULW\3)$
6RXUFH7DGDZXO1&%&5HVHDUFK
67
&(0(17~0$<
($67(51&(0(17
$/62.12:1$6(3&&
(DVWHUQ&HPHQW&R(3&&ZDVHVWDEOLVKHGLQQHDU
'DPPDPLQWKH(DVWHUQUHJLRQRI.6$(3&&ZDVDUHJXODU
H[SRUWHURIFHPHQWWRQHLJKERULQJFRXQWULHV/LPLWHGVSDUH
FDSDFLW\DQGORZLQYHQWRU\ZRXOGKLQGHUWKHFRPSDQ\¶VDELOLW\
WRPHHWLQFUHDVLQJGHPDQG
1(875$/
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
(3&&¶VPDUNHWVKDUHKDVEHHQGHFOLQLQJRYHUWKH\HDUVLWIHOOWRLQ
IURPLQDQGLQDQGLQ7KH
FRPSDQ\KDGDSURGXFWLRQFDSDFLW\RIPQWRQVRIFHPHQW(3&&KROGVD
VWDNHLQ$UDELDQ<HPHQL&HPHQW&RPSDQ\LQ,QGXVWULDOL]DWLRQ
DQG(QHUJ\6HUYLFHV&RPSDQ\DQGLQ6DXGL,QGXVWULDO,QYHVWPHQW
*URXS
x )LQDQFLDOV
(3&&¶VUHYHQXHGHFOLQHG<R<WR65PQLQODUJHO\GXHWRD
GHFOLQHLQVDOHVYROXPHVE\KRZHYHUSDUWLDOO\RIIVHWE\KLJKHUFHPHQW
SULFHVGXULQJWKH\HDU'HVSLWHWKLV(%,7'$JUHZWR65PQDQGQHW
LQFRPHURVHWR65PQPDLQO\GXHWRWKH<R<GHFOLQHLQWKHXQLWFRVW
RISURGXFLQJFHPHQW
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
x 5HFHQWGHYHORSPHQWV
2Q0DUFK(3&&DSSURYHGWKHGLVWULEXWLRQRIRILWVFDSLWDO
65SHUVKDUHDVFDVKGLYLGHQGIRU
,Q-DQXDU\WKHFRPSDQ\UHFHLYHGD\HDUOLFHQVHIURPWKH0LQLVWU\RI
3HWUROHXPDQG0LQHUDO5HVRXUFHVWRTXDUU\OLPHVWRQHLQWKH:DGL$O$KVD
SURYLQFH
,Q6HSWHPEHUWKHFRPSDQ\UHSDLGWKHWRWDOORDQGXH65PQWR
6DXGL,QGXVWULDO'HYHORSPHQW)XQGEHIRUHPDWXULW\
6(
%ORRPEHUJFRGH
($&&2$%
ZZZHDVWHUQFHPHQWFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
(
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
(
(
<R<
10
&$*5
(
10
0D\
6HS
7$6,
-DQ
0D\
(DVWHUQ&HPHQW5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
3XEOLF3HQVLRQ$XWKRULW\3)$ 3XEOLF,QYHVWPHQW)XQG
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
68
&(0(17~0$<
<$1%8&(0(17
$/62.12:1$6<&&
<DQEX&HPHQW&RPSDQ\<&&LVDPHGLXPVL]HGFHPHQW
FRPSDQ\EDVHGLQ-HGGDK<&&¶VORFDWLRQZKLFKLVFORVHWR
WKHZHVWHUQUHJLRQ¶VPDLQSURMHFWVDQGLWVSRWHQWLDOH[FHVV
FDSDFLW\DUHWKHVWRFN¶VNH\FDWDO\VWV
1(875$/
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
-HGGDKEDVHG<DQEX&HPHQW&RPSDQ\ZDVHVWDEOLVKHGLQ0DUFKZLWK
DQLQLWLDOSURGXFWLRQFDSDFLW\RIWRQVRIFOLQNHUSHUGD\7KHFRPSDQ\
ZDVVHWXSDW5DV%DULGLQHDU<DQEXRQWKHZHVWFRDVWRI6DXGL$UDELD
672&.'(7$,/6
&XUUHQWO\<&&¶VWRWDOFHPHQWSURGXFWLRQFDSDFLW\VWDQGVDWPQWRQVSHU ZHHNUDQJH+/65
\HDU7KHFRPSDQ\¶VPDUNHWVKDUHKDVEHHQGHFOLQLQJGXHWRLQFUHDVLQJ
0DUNHWFDSPQ
FRPSHWLWLRQ,QWKHGRPHVWLFPDUNHW<&&¶VVKDUHIHOOWRLQIURP
6KDUHVRXWVWDQGLQJPQ
LQ
3ULFHSHUIRUP
x )LQDQFLDOV
$EVROXWH
7KHFRPSDQ\¶VUHYHQXHLQFUHDVHG<R<WR65PQLQRIIWKH
EDFNRIKLJKHUVDOHVYROXPHVFRXSOHGZLWKLQFUHDVHGFHPHQWSULFHV$VD
UHVXOWQHWSURILWJUHZ<R<WR65PQGXULQJWKH\HDU
x 5HFHQWGHYHORSPHQWV
2Q$SULO<DQEX&HPHQW&RPSDQ\VLJQHGDFRQWUDFWZLWK6DXGL
$UDPFRWRSURYLGHIXHOIRUWKHRSHUDWLRQRILWVILIWKOLQHZLWKDGDLO\SURGXFWLRQ
FDSDFLW\RIWRQVRIFOLQNHU)XUWKHUPRUHRQ0DUFK<&&
DSSURYHGWKHGLVWULEXWLRQRIDFDVKGLYLGHQGRIRIVKDUHFDSLWDORU
65SHUVKDUH)LQDOO\RQ'HFHPEHUWKHFRPSDQ\UHVWDUWHG
SURGXFWLRQLQWKUHHRILWVIRXUOLQHVLQZKLFKLWKDGVWDOOHGSURGXFWLRQLQ
2FWREHUGXHWRGLYHUVLRQRIIXHOWRWHVWQHZSURGXFWLRQOLQHV
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
<1&&2$%
ZZZ\DQEXFHPHQWFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
(
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
0D\
6HS
7$6,
-DQ
0D\
<DQEX&HPHQW5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
3XEOLF,QYHVWPHQW)XQG 6XODLPDQ$EGXO$]L]6DOHK$O
5DMKL
$EGXOODK$EGXO$]L]6DOHK$O5DMKL
6RXUFH7DGDZXO1&%&5HVHDUFK
69
&(0(17~0$<
$5$%,$1&(0(17
$/62.12:1$6$&&
$UDELDQ&HPHQW&RPSDQ\$&&ZDVWKHILUVWWRFRPPHQFH
FHPHQWSURGXFWLRQLQ6DXGL$UDELDLQ7KHFRPSDQ\
PDLQO\SURGXFHVSRUWODQGFHPHQWSRUWODQGSR]]RODQFHPHQW
VXOIDWHUHVLVWDQWFHPHQWDQGUHDG\PL[FRQFUHWH$VRI
$&&KDGDSURGXFWLRQFDSDFLW\RIDURXQGPQWRQVRI
FHPHQWDQGPQWRQVRIFOLQNHUSHU\HDU
x %XVLQHVVEULHI
&XUUHQWSULFH65 3ULFLQJDVRI
$&&WKHROGHVWFHPHQWFRPSDQ\LQWKH.LQJGRPSURGXFHGPQWRQVRI
FHPHQWDQGPQWRQVRIFOLQNHULQ7KHFRPSDQ\¶VPDUNHWVKDUHKDV
GHFOLQHGFRQVLVWHQWO\IURPLQWRLQDQGWRDWWKH
HQGRI7KLVZDVPDLQO\GXHWRLQFUHDVHGFRPSHWLWLRQIROORZLQJWKH
HQWU\RIIRXUQHZSOD\HUVLQWKH6DXGLPDUNHW
672&.'(7$,/6
$&&¶VUHYHQXHJUHZ<R<WR65PQLQGULYHQODUJHO\E\
KLJKHUVDOHVYROXPHVDQGLQFUHDVHGFHPHQWSULFHV(%,7'$PDUJLQ
LQFUHDVHGWRLQFRPSDUHGWRLQGXHWRORZHUFRVWSHU
WRQDQG6*$H[SHQVHVGXULQJWKH\HDU'ULYHQE\WKLVQHWPDUJLQDOVR
PRYHGXSWRLQIURPLQQHWSURILWJUHZ<R<
WR65PQ
2Q$SULO$&&DSSURYHGWKHGLVWULEXWLRQRI65SHUVKDUHFDVK
GLYLGHQGIRUWKHVL[PRQWKSHULRGHQGLQJ'HFHPEHU
2Q)HEUXDU\WKHFRPSDQ\DQQRXQFHGWKHSXUFKDVHRIWRQV
RIFOLQNHUIURP6DXGL&HPHQW&RPSDQ\
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
$5&&2$%
ZZZDUDELDFHPHQWFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
&RPSDQ\ILQDQFLDOV
0DUNHWFDSPQ
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
ZHHNUDQJH+/65
$EVROXWH
x )LQDQFLDOV
127&29(5('
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
$UDE&HPHQW5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$EGXOD]L]$O6XODLPDQ
6XODLPDQ$EGXO$]L]6DOHK$O5DMKL
1DWLRQDO&RPPHUFLDO%DQN
3XEOLF3HQVLRQ$XWKRULW\33$
6RXUFH7DGDZXO1&%&5HVHDUFK
70
&(0(17~0$<
$/-28)&(0(17&203$1<
$/62.12:1$6-&&
$O-RXI&HPHQW&RPSDQ\-&&KDVUHFRUGHGDVLJQLILFDQW
JURZWKDIWHUFRPPHQFLQJFRPPHUFLDOSURGXFWLRQLQ7KH
FRPSDQ\WULSOHGLWVUHYHQXHVLQDVPRVWRILWVSURGXFWLRQ
XQLWVUDQFORVHWRIXOOFDSDFLW\-&&¶VORFDWLRQQRUWKZHVWHUQ
UHJLRQFORVHWRWKH-RUGDQLDQDQG,UDTLERUGHULVLWVNH\
VWUHQJWK,QWKHFRPSDQ\KDGDQDQQXDOSURGXFWLRQ
FDSDFLW\RIPQWRQVRIFHPHQW
x %XVLQHVVEULHI
6LQFHFRPPHQFLQJSURGXFWLRQLQ-XO\-&&KDVSURGXFHGDQDYHUDJHRI
NWRQVRIFHPHQWSHUPRQWKZLWKGRPHVWLFFHPHQWVDOHVDYHUDJLQJN
WRQVSHUPRQWK7KHFRPSDQ\KDGDVKDUHLQWKHORFDOFHPHQWPDUNHW
LQZKLFKLQFUHDVHGWRLQ
x )LQDQFLDOV
-&&FRPPHQFHGFRPPHUFLDOVDOHVLQ7KHFRPSDQ\JHQHUDWHG
65PQLQUHYHQXHVLQFRPSDUHGWR65PQLQOHGE\KLJKHU
VDOHVYROXPH(%,7'$LQFUHDVHGWR65PQLQIURP65PQWKH
SUHYLRXV\HDUDVRSHUDWLRQDOHIILFLHQF\OHGWRORZHUFRVWV'ULYHQE\WKLVQHW
SURILWDOVRLQFUHDVHGWR65PQGXULQJWKH\HDUIURP65PQODVW\HDU
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
x 5HFHQWGHYHORSPHQWV
2Q0DUFK-&&VLJQHGDFRQWUDFWZLWK:DUWVLODWRVXSSO\DQGLQVWDOO
DQHOHFWULFDOSODQWZLWKDFDSDFLW\RI0:ZRUWK65PQ$GGLWLRQDOO\RQ
-DQXDU\WKHFRPSDQ\DQQRXQFHGWKDWLWZRXOGVHWXSDVHFRQG
SURGXFWLRQOLQHIRUFOLQNHUZLWKDFDSDFLW\RIWRQVSHUGD\DWDFRVWRI
65PQ
6(
%ORRPEHUJFRGH
-28)$%
ZZZMRXIFHPFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10 3%[
36[
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
<R<
&$*5
10
10
10
10
10
0D\
6HS
7$6,
-DQ
0D\
$O-RXI&HPHQW5+6
7236+$5(+2/'(56
.6%&DSLWDO*URXS
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
71
&(0(17~0$<
7$%8.&(0(17
$/62.12:1$67&&
Tabuk Cement Company (TCC), founded in 1994, is among the
smallest cement manufacturers in KSA in terms of market
capitalization and capacity. In 2011, the company had an
annual production capacity of 1.46mn tons of cement at its
plant in the north-west region of the Kingdom7&&¶VORFDWLRQ
enables it to cater to the demand for cement in the northern
region.
x Business brief
7&&¶VVKDUHLQWKHGRPHVWLFFHPHQWPDUNHWKDVGHFOLQHGIURPLQ
WRLQ7KHFRPSDQ\KROGVVWDNHLQ,QGXVWULDOL]DWLRQ
(QHUJ\6HUYLFHV&RPSDQ\DVXSSRUWVHUYLFHVDQGSURGXFWPDQXIDFWXULQJ
RUJDQL]DWLRQFDWHULQJWRWKHHQHUJ\VHFWRU,QDGGLWLRQ7&&KROGVDPDUJLQDO
VWDNHLQ6DXGL&HPHQW&RPSDQ\
x Financials
7&&¶VUHYHQXHVJUHZ<R<WR65PQLQGXHWRKLJKHUVDOHV
YROXPHVGULYHQE\LQFUHDVHGGRPHVWLFGHPDQG(%,7'$URVH<R<WR
65PQDQGQHWSURILWLQFUHDVHG<R<WR65PQGXULQJWKH\HDU
+RZHYHUQHWPDUJLQVGHFOLQHGWRLQIURPLQGXHWR
DQLQFUHDVHLQRSHUDWLQJFRVWDQGDGHFUHDVHLQRWKHULQFRPH
NOT COVERED
Current price (SR)
3ULFLQJDVRI
STOCK DETAILS
ZHHNUDQJH+/65
,Q$SULO7&&DQQRXQFHGDFDVKGLYLGHQGRIRIFDSLWDOIRUIXOO\HDU
ZKLFKLQFOXGHVIRUWKHILUVWKDOIRIWKH\HDU)XUWKHUPRUHRQ$SULO
7&&DQQRXQFHGLWVMRLQWYHQWXUHZLWK<DPDWLN)LQODQG&RPSDQ\DQGD
0DOD\VLDQILUPWRIRUPDQHZFRPSDQ\WRSURGXFHFRQFUHWHFHPHQW7&&
ZRXOGRZQDVWDNHLQWKHYHQWXUH
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
Company financials
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
7$&&2$%
ZZZWFFVDFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
3([
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
1M
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
0DUNHWFDSPQ
%ORRPEHUJFRGH
x Recent developments
24.9
09A
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
2008
2009
2010
2011
YoY
(%)
1$
CAGR (%)
(08-11)
1$
SHARE PRICE PERFORMANCE
0D\
6HS
7$6,
-DQ
0D\
7DEXN&HPHQW5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
.KDOHG6DOHK$EGXO5DKPDQ$O
6KDWKU\
3XEOLF3HQVLRQ$XWKRULW\33$
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
72
&(0(17~0$<
+$,/&(0(17
$/62.12:1$6+&&
+DLO&HPHQW&RPSDQ\+&&ZDVHVWDEOLVKHGLQ1RYHPEHU
LQ6DXGL$UDELD7KHFRPSDQ\LVHQJDJHGLQWKH
SURGXFWLRQSDFNDJLQJDQGGLVWULEXWLRQRIFOLQNHURUGLQDU\
3RUWODQGFHPHQWDQGVXOIDWHUHVLVWLQJFHPHQW+&&¶V,32
UDLVHG65PQLQ6HSWHPEHUDQGZDVOLVWHGLQ2FWREHU
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
+&&ZDVHVWDEOLVKHGWRSURGXFHFOLQNHUDQGDOOW\SHVRIFHPHQWGHULYDWLYHV
DQGEXLOGLQJPDWHULDOVDQGGLVWULEXWHWKHPLQDQGRXWVLGHWKH.LQJGRP7KH
FRPSDQ\¶VSODQWVDUHFXUUHQWO\XQGHUFRQVWUXFWLRQLWLVH[SHFWHGWRVWDUW
RSHUDWLRQVLQ8SRQFRPSOHWLRQ+&&ZRXOGKDYHDQDQQXDOSURGXFWLRQ
FDSDFLW\RIPQWRQVRIFOLQNHUPQWRQVRIRIFHPHQW
x )LQDQFLDOV
+&&GLGQRWJHQHUDWHDQ\UHYHQXHLQDVLWLVQRW\HWRSHUDWLRQDO7KH
FRPSDQ\UHSRUWHGDORVVRI65PQIRUWKHODVWPRQWKVPDLQO\GXHWR
KLJKSUHRSHUDWLQJH[SHQVHV
x 5HFHQWGHYHORSPHQWV
2Q-DQXDU\+&&DQQRXQFHGWKDWLWKDGVLJQHGDKRXVLQJFRQWUDFW
ZRUWK65PQZLWKWKHMRLQWYHQWXUHEHWZHHQ7HEHUDN7UDGLQJ
&RQWUDFWLQJ&RPSDQ\DQG0RHQLV0RKDPPHG$O6KD\HE)RXQGDWLRQIRUFLYLO
FRQVWUXFWLRQ7KHWRWDODUHDRIWKHKRXVLQJFDPSXVZRXOGEH6TPWV
7KHSURMHFWLVH[SHFWHGWREHFRPSOHWHZLWKLQDVSDQRIPRQWKV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
+&&$%
ZZZKDLOFHPHQWFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
0
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
10
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
10
10
10
10
<R<
10
10
10
10
10
&$*5
2FW
'HF
7$6,
)HE
0D\
+DLO&HPHQW5+6
7236+$5(+2/'(56
<DPDPD6DXGL&HPHQW&RPSDQ\
6DXGL5HDO(VWDWH&RPSDQ\
$O0DO,QYHVWPHQW
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH7DGDZXO&RPSDQ\1&%&5HVHDUFKPRQWK'HFHPEHUILJXUHVPRQWKVILJXUHV)<
6RXUFH%ORRPEHUJ
73
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Retail
Ticker
Company
Page No.
4001
Al Othaim
77
4190
Jarir Marketing
78
4240
AlHokair
79
4200
Aldrees
80
4002
Mouwasat
81
4050
SASCO
82
4180
Fitaihi Group
83
4290
Alkhaleej Trng
84
4160
National Agriculture
85
4003
Extra
86
$35,/
5(7$,/
9ROXPHJURZWKSRWHQWLDOUHPDLQVKLJK
.6$¶VUHWDLOVHFWRULVGULYHQE\LQFUHDVLQJXUEDQL]DWLRQULVLQJ
GLVSRVDEOHLQFRPHVJURZLQJEUDQGDZDUHQHVVDQGJUHDWHUDFFHVV
WRRUJDQL]HGUHWDLO$GGLWLRQDOO\JRYHUQPHQWLQLWLDWLYHVVXFKDV
XQHPSOR\PHQWEHQHILWVPLQLPXPZDJHUDWHVDQGSXEOLFVHFWRU
ZDJHLQFUHDVHVVKRXOGVXSSRUWQHDUWHUPUHWDLOVSHQGLQJ$
IUDJPHQWHGPDUNHWSURYLGHVRSSRUWXQLWLHVIRUWKHPDUNHWOHDGHUVWR
WDNHPDUNHWVKDUH6DXGLVDWLRQQHHGVHQWU\RIIRUHLJQILUPVDQG
VXSSO\FKDLQPDQDJHPHQWDUHULVNVWRWKHJURZWKSURVSHFWVRIWKH
VHFWRU
$FFRUGLQJWR(,8HVWLPDWHVWRWDOUHWDLOVDOHVLQ6DXGL$UDELDIRUFDPHLQDW
DQHVWLPDWHG86EQXSIURP86EQLQ5HWDLOVDOHVDVDZKROHDUH
H[SHFWHGWRJURZE\DQHVWLPDWHGLQWR86EQDQGLQFUHDVHWR
86EQE\)URPWKHUHWDLOWRWDODSSUR[LPDWHO\RIWKHVDOHVYDOXH
LQFDPHIURPIRRGVDOHV86EQ7KURXJKDFRPELQDWLRQRISRVLWLYH
PDFURIDFWRUVKLJKRLOSULFHODUJHSRSXODWLRQZKLFKLV\RXQJDQGJURZLQJ
LQFUHDVHGPRYHWRZDUGVRUJDQLVHGUHWDLOLQJHWFZHEHOLHYHWKLVVXSSRUWVWKH
ORQJWHUPJURZWKRXWORRNRIWKHVHFWRU
6XVWDLQHG<R<SURILWDELOLW\JURZWKLQ
2IWKHQLQHFRPSDQLHVLQWKHVHFWRU-DULU0DUNHWLQJ&RDQG)DZD]$EGXOD]L]
$O+RNDLU&RDUHWKHODUJHVWZLWKDPDUNHWFDSLWDOL]DWLRQRI65EQDQG
65EQUHVSHFWLYHO\DVRI$SULO7KHWZRFRPSDQLHV¶UHVSHFWLYHZHLJKW
LQWKH7$6,LQGH[ZDVDQGZKHUHDVWKHUHWDLOVHFWRUDVDZKROH
DFFRXQWHGIRU
7KHFRPELQHGUHYHQXHRIWKHQLQHFRPSDQLHVURVH<R<WR65EQLQ
7KHVHFWRU¶VQHWHDUQLQJVJUHZ<R<WR65EQGXULQJWKHVDPH
SHULRG-DULU0DUNHWLQJUHSRUWHGD<R<LQFUHDVHLQQHWSURILWWR65PQLQ
ZKLOH$O+RNDLU¶VQHWSURILWJUHZ<R<WR65PQLQWKHVDPH
\HDU-DULU0DUNHWLQJDQG$O+RNDLUSRVWHGQHWPDUJLQVRIDQG
UHVSHFWLYHO\KLJKHUWKDQWKHLQGXVWU\DYHUDJHRI
Exhibit 63: Revenue of companies, 2009±2011
Exhibit 64: Profitability of companies, 2009±2011
65PQ
-DULU
6RXUFH=DZ\D
$O2WKDLP
$O+RNDLU
2WKHUV
1HWLQFRPH
1HWPDUJLQ
6RXUFH=DZ\D
$VRI'HFHPEHUWKHDYHUDJH3%PXOWLSOHRI6DXGLUHWDLOFRPSDQLHV
GURSSHGWR[IURP[LQ+RZHYHUWKHDYHUDJHUHSRUWHGUHWXUQRQ
HTXLW\LQFUHDVHGE\EDVLVSRLQWVWRLQ
75
5(7$,/
1&%&$3,7$/
$35,/
Exhibit 65: Comparison of P/B and ROE, 2010
Exhibit 66: Comparison of P/B and ROE, 2011
8QLWHG
(OHFWURQLFV
$OGUHHV
6$6&2
$ONKDOHHM
)LWDKL*URXS
$O0RXZDVDW
3%[
$O2WKDLP
$OGUHHV
6$6&2
1DWLRQDO$JUL
3%[
)LWDKL*URXS
6RXUFH=DZ\D
1DWLRQDO$JUL
$O0RXZDVDW
$ONKDOHHM
-DULU
8QLWHG
(OHFWURQLFV
$O+RNDLU
$O2WKDLP
$O+RNDLU
52(
52(
-DULU
6RXUFH=DZ\D
/RQJWHUPGULYHUVLQWDFWXQHPSOR\PHQWEHQHILWVWRVXSSRUW
JURZWKLQWKHQHDUWHUP
/RRNLQJDKHDG.6$¶VUHWDLOVHFWRULVOLNHO\WREHGULYHQE\SRSXODWLRQJURZWK
ULVLQJLQFRPHVDQGWKHVSUHDGRIRUJDQL]HGUHWDLO$GGLWLRQDOO\WKH
XQHPSOR\PHQWEHQHILWVFKHPHLQWURGXFHGLQODWHZKLFKSD\VXQHPSOR\HG
6DXGLQDWLRQDOV65DPRQWKFRXOGKHOSDFFHOHUDWHVSHQGLQJLQWKHFDVK
EDVHGUHWDLOVHFWRU6LPLODUO\DLQFUHDVHLQSXEOLFVHFWRUZDJHVFRXOG
GULYHUHYHQXHJURZWKIRUPDMRUSOD\HUVVXFKDV-DULUDQG$/+RNDLULQWKH
VHFWRU
1&%&5HFRPPHQGDWLRQVIRUWKH6HFWRU
,QWKHORQJWHUPZHDUHSRVLWLYHRQ6DXGL$UDELD¶VUHWDLOVHFWRUFRQVLGHULQJWKH
VWURQJIXQGDPHQWDOVRIWKHGRPHVWLFPDUNHWDVZHOODVJRYHUQPHQWVWLPXOXV
VXSSRUWLQJFRQVXPHUVSHQGLQJ:HFXUUHQWO\KDYHWKUHHVWRFNVLQWKHVHFWRU
XQGHURXUFRYHUDJH-DULU$O+RNDLUDQG$O2WKDLP
Exhibit 67: Coverage stocks details
Stock
Current Rating
-DULU
6(
1HXWUDO
$O+RNDLU
6(
1HXWUDO
$O2WKDLP
6(
2YHUZHLJKW
PT (SR)
Comments
3ODQVWRDOPRVWGRXEOHQXPEHURIVWRUHVFRXSOHGZLWKD,7PDUNHWVKDUH
SURYLGHVWURQJSODWIRUPIRUWKHVWRFN/RZOLTXLGLW\DQGGHFOLQLQJSULFHRIODSWRSV
DFRQFHUQ6WRUHRSHQLQJVWKHNH\FDWDO\VWIRUWKHVWRFN9DOXDWLRQLVVRPHZKDW
VWUHWFKHGDW[H3(
$O+RNDLULVXQGHUJRLQJDJJUHVVLYHLQWHUQDWLRQDOH[SDQVLRQLQIRUPHU6RYLHW
8QLRQFRXQWULHVVXFKDV.D]DNKVWDQDQG$]HUEDLMDQ:HEHOLHYHWKLVFRPHV
ZLWKLQFUHDVHGULVNVYVLWV6DXGLEXVLQHVV:HEHOLHYHWKHYDOXDWLRQLVQRW
DWWUDFWLYHDW[H3(
$O2WKDLPLVWKHQXPEHUWZRIRRGUHWDLOHULQWKH.6$,WLVZHOOSRVLWLRQHGWR
LQFUHDVHVKDUHDVPDUNHWVKLIWVWRRUJDQL]HGUHWDLOLQJ(QWUDQFHRIIRUHLJQ
SOD\HUVDQGULVLQJ&2*6DUHNH\ULVNV6WRUHH[SDQVLRQLVNH\FDWDO\VWIRUWKH
VWRFN2QJRLQJ5(DFTXLVLWLRQLVKROGLQJEDFNWKHVWRFN
6RXUFH1&%&5HVHDUFK
76
5(7$,/~0$<
$%'8//$+$/27+$,0
$/62.12:1$6$/27+$,0
With operations commencing in 1956, Abdullah Al Othaim
Markets Company (Al Othaim) is the second-largest food
retailer in Saudi Arabia. It is well positioned to take advantage
of the growth prospects of organised food retail in Saudi
Arabia. However, high food prices and WKHFRPSDQ\¶V limited
ability to pass on cost inflation amid rising competition are
the key risks for the stock.
x Business brief
$O2WKDLPRSHUDWHVIRXUVWRUHIRUPDWVK\SHUPDUNHWVVXSHUPDUNHWVFRUQHU
VWRUHVDQGZKROHVDOHVWRUHV7KHFRPSDQ\UXQVDFKDLQRIRYHUVWRUHV
SULPDULO\LQFHQWUDO6DXGL$UDELDDQGLVORRNLQJWRRSHQQHZVWRUHVLQ
$O2WKDLPKDVVLJQHGDQDJUHHPHQWWREX\WKHUHPDLQLQJVWDNHLQLWV
UHDOHVWDWHDUPLQDOWKRXJKWKHGHDOLV\HWWRFRPSOHWH
x Financials
$O2WKDLP¶VUHYHQXHVJUHZ<R<WR65PQLQODUJHO\GULYHQ
E\DQLQFUHDVHLQWKHVWRUHFRXQWDWWKHHQGRIDQGDWWKHHQGRI
DVZHOODVRUJDQLFJURZWK(%,7'$URVH<R<WR65PQ
GXULQJWKH\HDU1HWSURILWGHFUHDVHG<R<WR65PQLQGXHWR
WKHDEVHQFHRIRQHRIILQFRPH65PQLQDVZHOODVORZHUUHEDWHV
IURPVXSSOLHUV$GMXVWLQJIRU2WKHULQFRPHQHWLQFRPHIRUWKH\HDUIHOO
PDLQO\GXHWRKLJKHUGHSUHFLDWLRQFKDUJHVDVZHOODVGLVFRQWLQXDWLRQRIWKH
FDSLWDOL]DWLRQRIILQDQFLDOFKDUJHVLQ&RQWLQXHGVWRUHH[SDQVLRQDQG
WKHDVVRFLDWHGLQFUHDVHLQYROXPHVVROGDUHH[SHFWHGWRGULYHJURZWKLQ
UHYHQXHVLQWKHFRPLQJ\HDUV+RZHYHUZHEHOLHYHRUJDQLFJURZWKZRXOG
UHPDLQVXEGXHGDPLGLQFUHDVLQJFRPSHWLWLRQ
OVERWEIGHT
Current price (SR)
86.0
3ULFLQJDVRI
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$27+$,0$%
ZZZRWKDLPPDUNHWVFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
x Recent developments
7REXLOGZDUHKRXVHVDQGUHVLGHQFHVIRULWVHPSOR\HHV$O2WKDLPDFTXLUHG
VTXDUHPHWHUVRIODQGZRUWK65PQLQWKHLQGXVWULDO]RQHRI
5L\DGKLQ$XJXVW
11A
12A
13E
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2010
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2011
2012E
2013E
YoY
(%)
CAGR (%)
(10-13E)
0D\
6HS
7$6,
-DQ
0D\
$2WKDLP0DUNHWV5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
$O2WKDLP+ROGLQJ&RPSDQ\
$EGXO$]L]6DOHK$O2WKDLP
$EGXOODK6DOHK$OL$O2WKDLP
6RXUFH7DGDZXO1&%&5HVHDUFK
77
5(7$,/~0$<
-$5,50$5.(7,1*
$/62.12:1$6-$5,5
Jarir Marketing Company (Jarir) was established in Riyadh in
NEUTRAL
1979. Historically, the company was focused on the sale of
books, school items and office supplies. In the past five years,
Current price (SR) 152.3
Jarir has increasingly focused on the sale of electronics such
3ULFLQJDVRI
as laptops, gaming devices and smartphones. 7KHFRPSDQ\¶V
position as one of the leading electronics retailer in the region
is a key positive; pressure on margins from competition is a
key risk.
x Business brief
-DULU¶VEXVLQHVVDFWLYLWLHVDUHGLYLGHGLQWRIRXUEURDGVHJPHQWV6FKRRO
6XSSOLHV2IILFH6XSSOLHV&RQVXPHU(OHFWURQLFVDQG%RRNV7KHFRPSDQ\
KDGVWRUHVDFURVVWKH*&&DVRIXSIURPLQ-DULUKDV
EHQHILWHGIURPWKH\RXQJGHPRJUDSKLFVRIWKHUHJLRQWREHFRPHRQHRIWKH
OHDGLQJFRQVXPHUHOHFWURQLFVUHWDLOHUVLQWKH*&&
x Financials
-DULU¶VUHYHQXHVJUHZ<R<WR65PQLQGXHWRVWURQJVDOHV
LQHOHFWURQLFLWHPVSDUWLFXODUO\WDEOHWVDQGVPDUWSKRQHVWKHFRPSDQ\
LQFUHDVHGLWVVWRUHFRXQWWRIURPD\HDUDJR$OWKRXJKPDUJLQV
GHFOLQHGGXHWR-DULU¶VDJJUHVVLYHSULFLQJDQGWKHRQJRLQJVKLIWLQWKHVDOHV
PL[WRZDUGVORZHUPDUJLQHOHFWURQLFLWHPV(%,'7$LQFUHDVHG<R<WR
65PQLQ1HWLQFRPHJUHZ<R<WR65PQLQZKLOH
QHWPDUJLQGHFOLQHGWRLQIURPLQ
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
SR
US$
Avg daily turnover (mn)
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
-$5,5$%
ZZZMDULUERRNVWRUHFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
x Recent developments
WK
VW
2Q$SULO-DULUDQQRXQFHGWKHRSHQLQJRILWV VWRUHLQ6DXGL VWRUHLQWKH*&&ZLWKDWRWDOIORRUVSDFHRIVTPWUVIRUDWRWDORI
65PQ7KHFRPSDQ\DOVRPHQWLRQHGWKDWLWSODQVWRRSHQRQHPRUHVWRUH
LQ5L\DGKWKLVZRXOGWDNHLWVWRWDOVWRUHFRXQWWRDWWKHHQGRI,Q
'HFHPEHU-DULUDQQRXQFHGWKDWLWV(*0KDGDSSURYHGWKHULVHLQ
FDSLWDOZKLFKZRXOGLQFUHDVHLWVQXPEHURIRXWVWDQGLQJVKDUHVIURPPQWR
PQ2Q$XJXVW-DULUDQQRXQFHGWKHRSHQLQJRIDQHZVT
PWUVWRUHLQ$O5HIDDL*URXS&HQWHULQ0HNNDK
)UHHIORDW
VALUATION MULTIPLES
11A
12A
13E
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2010
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2011
2012E
2013E
YoY
(%)
10
CAGR (%)
(10-13E)
10
0D\
6HS
-DQ
7$6,
0D\
-DULU5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
-DULU&RPPHUFLDO,QYHVWPHQW&R
0RKDPPHG$EGXO5DKPDQ
1DVVHU$O$THHO
$EGXO6DODP$EGXO5DKPDQ
1DVVHU$O$THHO
$EGXOODK$EGXO5DKPDQ1DVVHU$O
$THHO
$EGXO.DULP$EGXO5DKPDQ
1DVVHU$O$THHO
6RXUFH7DGDZXO1&%&5HVHDUFK
78
5(7$,/~0$<
)$:$=$%'8/$=,=$/+2.$,5
$/62.12:1$6$/+2.$,5
Fawaz Abdulaziz AlHokair Company (AlHokair), established in
1990, is the largest fashion retail franchise player in Saudi
Arabia, accounting for roughly half of the mid-market fashion
retail business in the KSA through its 70 plus brands. The
ILUP¶V position as a leading player in the growing market is a
key positive, while increased risk from overseas expansion
and potential margin pressure are the concerns for the stock.
x Business brief
$O+RNDLURSHUDWHVDURXQGIDVKLRQVWRUHVDQGLVWKHUHWDLOIUDQFKLVH
SDUWQHUIRURYHUJOREDOEUDQGV%UDQGVXQGHULWVFRQWUROLQFOXGH=DUD
%DQDQD5HSXEOLF*$30RQVRRQDQG0DUNV6SHQFHUV$O+RNDLURZQVD
PDMRULW\VWDNHLQ5HWDLO*URXS(J\SWDQG5HWDLO*URXS-RUGDQERWKDFTXLUHG
IURPLWVSDUHQWLQ-XQH$IWHULQLWLDOH[SDQVLRQLQ-RUGDQ(J\SWDQG
.D]DNKVWDQ$O+RNDLULVQRZWDUJHWLQJRWKHUH[&,6FRXQWULHVVXFKDV
$]HUEDLMDQ*HRUJLDDQG$UPHQLD
x Financials
NEUTRAL
Current price (SR)
3ULFLQJDVRI
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
$O+RNDLU¶VUHYHQXHVURVH<R<WR65PQIRUWKH\HDUHQGHG
0DUFK)<PDLQO\GXHWRWKHJURZWKLQVDPHVWRUHVDOHVDQG
RSHQLQJRIQHZVWRUHVGXULQJWKH\HDU(%,'7$JUHZ<R<WR
65PQLQ)<DV(%,7'$PDUJLQH[SDQGHGWRIURPODVW
\HDUGXHWRORZHURSHUDWLQJH[SHQVHVDVDSHUFHQWDJHRIVDOHV7KLVDQGD
<R<MXPSLQRWKHULQFRPHOHGWRQHWLQFRPHJURZLQJE\WR65PQLQ
)<:HH[SHFWVXVWDLQHGH[SDQVLRQLQUHYHQXHVLQWKHFRPLQJ\HDUV
GULYHQE\WKHFRQWLQXHGVWRUHH[SDQVLRQSODQZLWKDSULPDU\IRFXVRQ
LQWHUQDWLRQDOPDUNHWV7KHUHFHQWFRPPHQFHPHQWRISD\PHQWWRXQHPSOR\HG
ORFDOVE\WKH6DXGLJRYHUQPHQWVKRXOGERRVWVSHQGLQJRQGLVFUHWLRQDU\
LWHPVWKHUHE\EHQHILWWLQJFRPSDQLHVVXFKDV$O+RNDLU
x Recent developments
2Q2FWREHUWKHFRPSDQ\DSSURYHGWKH65PQILQDQFLQJ
DJUHHPHQWZLWKWKH,QWHUQDWLRQDO)LQDQFH&RUSRUDWLRQ,)&RQHRIWKH
LQVWLWXWLRQVRIWKH:RUOG%DQN
82.3
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$/+2.$,5$%
ZZZDOKRNDLUFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
11A
12A
13E
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
FY11
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
FY12
FY13E
FY14E
YoY
(%)
CAGR (%)
(10-13E)
0D\
6HS
7$6,
-DQ
0D\
$O+RNDLU5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
)DZD]$OKRNDLU*URXS
)DZD]$EGXO$]L])DKG$O+RNDLU
'U$EGXOPDMHHG$EGXOD]L])DKHG
$OKRNDLU
'U6DOPDQ$EGXOD]L])DKHG
$OKRNDLU
6RXUFH7DGDZXO1&%&5HVHDUFK
79
5(7$,/~0$<
$/'5((63(752/(80
$/62.12:1$6$376&2$/'5((6
Aldrees Petroleum and Transport Services Co. (Aldrees),
established in 1963, has three main operational divisions:
Petroleum, Transport and Food. The company owns a 98%
stake in Aldrees Sudan, which is engaged in marine, land and
air transportation.
x Business brief
NOT COVERED
Current price (SR)
35.0
3ULFLQJDVRI
$OGUHHV¶3HWUROHXPGLYLVLRQRSHUDWHVDQHWZRUNRIJDVVWDWLRQVXQGHUWKH EUDQGQDPH¶3HWURO¶,WRSHUDWHVRQ±\HDUFRQWUDFWVDQGVXSSOLHVIXHOWR
STOCK DETAILS
JRYHUQPHQWDQGSULYDWHFRPSDQLHV7KH7UDQVSRUWVHJPHQWRSHUDWHVDQG
ZHHNUDQJH+/65
0DUNHWFDSPQ
PDLQWDLQVDIOHHWRIPRUHWKDQFDUULHUVUDQJLQJIURPFKHPLFDOOXEULFDQW
6KDUHVRXWVWDQGLQJPQ
WDQNHUVWUDLOHUVDQGEXONHUVWRIODWEHGV7KH6XSHUGLYLVLRQUXQVFRIIHH
Price perform (%) 1M
DQGFDNHVWRUHVXQGHUWKHEUDQGQDPHµ6XSHU&DIp¶,WDOVRKDQGOHVFDUZDVK
$EVROXWH
DQGFDUGHWDLOLQJFHQWHUVORFDWHGLQWKHFRPSDQ\¶VJDVVWDWLRQQHWZRUN
0DUNHW
XQGHUWKHEUDQGQDPHµ6XSHU:DVK¶
6HFWRU
x Financials
$OGUHHV¶UHYHQXHJUHZ<R<WR65PQLQRQKLJKHUVDOHV
YROXPHGXHWRH[SDQVLRQRIVWDWLRQV(%,'7$LQFUHDVHG<R<WR
65PQLQPDLQO\RZLQJWRLQFUHDVHLQRSHUDWLRQDOHIILFLHQF\1HW
SURILWLQFUHDVHG<R<WR65PQLQ
3M
12M
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
$/'5((6$%
ZZZDOGUHHVFRP
,Q)HEUXDU\&0$DSSURYHGDLQFUHDVHLQ$OGUHHV¶VKDUHFDSLWDO
IURP65PQWR65PQWKURXJKWKHGLVWULEXWLRQRIRQHERQXVVKDUHIRU
HYHU\ILYHH[LVWLQJVKDUHV6XEVHTXHQWO\$OGUHHV¶DSSURYHGWKHFDSLWDO
LQFUHDVHLQLWV(*0KHOGRQ0DUFK7KHFRVWRIGLVWULEXWLRQRIERQXV
VKDUHVZRXOGEHPHWIURPWKHFRPSDQ\¶VUHWDLQHGHDUQLQJV,QDGGLWLRQWKH
FRPSDQ\DQQRXQFHGWKHSD\PHQWRIFDVKGLYLGHQGRI65SHUVKDUHIRU
%ORRPEHUJFRGH
x Recent developments
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0D\
6HS
7$6,
-DQ
0D\
$OGUHHV5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
+DPDG0RKDPPHG6DDG$O'UHHV
$EGXO0RKVHQ0RKDPPHG6DDG
$O'UHHV
6RXUFH7DGDZXO1&%&5HVHDUFK
80
5(7$,/~0$<
028:$6$70(',&$/6(59,&(6
$/62.12:1$6028:$6$7
Mouwasat Medical Services (Mouwasat) owns, manages and
operates hospitals, dispensaries and pharmacies across
Saudi Arabia. Incorporated in 1974, the company commenced
its first owned comprehensive medical facility in 1988.
NOT COVERED
Current price (SR)
50.3
3ULFLQJDVRI
x Business brief
0RXZDVDWRSHUDWHVLQWKHILHOGRIPHGLFDOVHUYLFHVDFURVVWKH.LQJGRPDQG
RZQVQLQHSKDUPDFLHVWZRGLVSHQVDULHVDQGILYHKRVSLWDOVZLWKDFRPELQHG FDSDFLW\RIEHGV,WVPHGLFDOQHWZRUNFRYHUVWKHPDLQFLWLHVRI6DXGL
STOCK DETAILS
$UDELDLQFOXGLQJ'DPPDP-XEDLO4DWLI$O$KVD5L\DGKDQG$O0DGLQD$O ZHHNUDQJH+/65
0DUNHWFDSPQ
0RXZDVDWFRQYHUWHGIURPDOLPLWHGOLDELOLW\FRPSDQ\WRDMRLQWVWRFNFRPSDQ\
6KDUHVRXWVWDQGLQJPQ
LQ-DQXDU\
Price perform (%)
x Financials
0RXZDVDW¶VUHYHQXHJUHZ<R<WR65PQLQGXHWRLQFUHDVHG
HIILFLHQF\LQWKHRSHUDWLRQRIDVVHWVDVZHOODVULVHLQWKHQXPEHURI
RXWSDWLHQWFOLQLFV(%,7'$URVH<R<WR65PQLQ1HWLQFRPH
LQFUHDVHG<R<WR65PQ
x Recent developments
2Q$SULO0RXZDVDW¶VERDUGDSSURYHGGLVWULEXWLRQRIERQXV
VKDUHVIRUWKHUHE\LQFUHDVLQJWKHFRPSDQ\¶VVKDUHFDSLWDOWR
65PQ,Q6HSWHPEHUWKHFRPSDQ\VLJQHGWZR0XUDEDKDIDFLOLWLHV
DJUHHPHQWVZRUWK65PQZLWK6DPED)LQDQFLDO*URXSWRILQDQFHWKH
FRQVWUXFWLRQRIWKH'KDKUDQKRVSLWDODQGLWVUHVLGHQWLDOFRPSOH[
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
028:$6$7$%
ZZZPRXZDVDWFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
2009
2010
6RXUFH&RPSDQ\1&%&5HVHDUFKA9DULQGLFDWHVYDULDQFHIURP1&%&IRUHFDVWV
2011
YoY
(%)
CAGR (%)
(08-11)
0D\
6HS
7$6,
-DQ
0D\
0RXZDVDW5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
0RKDPPHG6XOWDQ+DPPDG$O
6XEDHL
1DVVHU6XOWDQ)DKDG$O6XEDHL
6XODLPDQ0RKDPPHG6XODLPDQ$O
6DOHHP
()*+HUPHV8$(
6RXUFH7DGDZXO1&%&5HVHDUFK
81
5(7$,/~0$<
6$8',$872027,9(
$/62.12:1$66$6&2
Saudi Automotive Services Company (SASCO), established in
1982 and headquartered in Riyadh, provides a variety of
services and utilities for cars, motorists and travelers. It owns
specialized maintenance workshops in Saudi Arabia. The
company also owns and manages supermarkets, rest areas
and restaurants for travelers.
NOT COVERED
Current price (SR)
20.6
3ULFLQJDVRI
x Business brief
6$6&2RIIHUVVHUYLFHVVXFKDVFDUPDLQWHQDQFHDQGUHSDLUVSDUHSDUWVFDU STOCK DETAILS
ZHHNUDQJH+/65
UHVFXHILUVWDLGLVVXDQFHRIFDUWHVWFHUWLILFDWHVDQGLQWHUQDWLRQDOGULYLQJ
0DUNHWFDSPQ
OLFHQVHV7KHFRPSDQ\DOVRRSHUDWHVDQHWZRUNRIVXSHUPDUNHWVSHWURO
6KDUHVRXWVWDQGLQJPQ
SXPSVKRXVLQJIDFLOLWLHVUHVWDUHDVUHVWDXUDQWVDQGRWKHUIDFLOLWLHVDFURVV
Price perform (%) 1M
6DXGL$UDELDWRVHUYLFHPRWRULVWVDQGWUDYHOHUV,WKDVPLQRULW\LQYHVWPHQWVLQ
$EVROXWH
IRXUILUPV0LGGOH(DVW%DWWHU\&R,QGXVWULDOL]DWLRQ(QHUJ\
0DUNHW
6HUYLFHV&R1DWLRQDO&RIRU7RXULVPDQG8QLWHG5DOO\&R
6HFWRU
Avg daily turnover (mn)
x Financials
6$6&2UHFRUGHGD<R<JURZWKLQUHYHQXHDW65PQLQ
(%,'7$PDUJLQIRUWKH\HDUGHFOLQHGWRFRPSDUHGWRLQGXH
WRKLJKHURSHUDWLQJH[SHQVHVPDLQO\LQFXUUHGIRUUHTXDOLILFDWLRQRIVRPH
SHWUROVWDWLRQV1HWLQFRPHLQFUHDVHG<R<WR65PQGXHWRDULVHLQ
LQYHVWPHQWLQFRPHDQGJDLQVIURPVDOHRIDVVHWVZRUWK65PQ
3M
12M
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6$&2$%
ZZZVDVFRFRPVD
WEIGHTING & FREEFLOAT (%)
x Recent developments
2Q)HEUXDU\6$6&2VLJQHGDQDJUHHPHQWZLWK8OWUD7XQH
$XVWUDOLDWRIRUPDMRLQWYHQWXUHFRPSDQ\ZLWKDFDSLWDORI86'PQWKH-9
ZRXOGRIIHUPDLQWHQDQFHVHUYLFHVIRUYHKLFOHVDQGSDVVHQJHUFDUVDW
JDVROLQHVWDWLRQVLQWKH.LQJGRP6$6&2VLJQHGDQDJUHHPHQWWRVHOOLWV
VWDNHPQVKDUHVZRUWK65PQLQ,QGXVWULDOL]DWLRQDQG(QHUJ\6HUYLFHV
&RPSDQ\WRWKHODWWHUFRPSDQ\7KHHIIHFWRIWKLVWUDQVDFWLRQZRXOGEH
UHIOHFWHGLQ4
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
10
CAGR (%)
(08-11)
10
0D\
6HS
7$6,
-DQ
0D\
6$6&25+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
1DKD]7UDGH,QYHVWPHQW
&RPSDQ\
,EUDKLP0RKDPPHG,EUDKLP$O
+DGLWKL
6RXUFH7DGDZXO1&%&5HVHDUFK
82
5(7$,/~0$<
),7$,+,*5283+2/',1*
$/62.12:1$6),7$,+,
Established in 1992, Fitaihi Group Holding Company
undertakes designing, manufacture, and wholesale and retail
distribution of gems, jewelry and precious stones. The
company has two marketing subsidiaries, Marina B Creation
Vados and Marina B Geneve, which market its products
worldwide. It is also engaged in the management of leading
hospitals in the region.
x Business brief
)LWDLKL¶VSURGXFWSRUWIROLRLQFOXGHVSUHFLRXVVWRQHVMHZHOU\EHDXW\SURGXFWV
NLWFKHQZDUHOHDWKHUSURGXFWVDQGFORWKLQJDFFHVVRULHVSHUIXPHVPHGLFDO
HTXLSPHQWDQGLQGXVWULDOSDUWV7KHFRPSDQ\KDVSUHVHQFHLQWKHKRVSLWDO
LQGXVWU\WKURXJKDLQYHVWPHQWLQ,QWHUQDWLRQDO0HGLFDO&HQWHUDQG
VWDNHLQ'DU$O)RXDG+RVSLWDO)LWDLKLDOVRKDVDVWDNHLQ)LWDLKL
-XQLRU7KHFRPSDQ\RZQVWZRSUHPLXPGHSDUWPHQWVWRUHVXQGHUWKHEUDQG
QDPHµ)LWDLKL¶LQ-HGGDKDQG5L\DGKLQDGGLWLRQWRRWKHURXWOHWV
x Financials
NOT COVERED
Current price (SR)
3ULFLQJDVRI
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
)LWDLKL¶VUHYHQXHVIRULQFUHDVHG<R<WR65PQ(%,7'$URVH
<R<WR65PQ+RZHYHUWKHFRPSDQ\UHSRUWHGDQHWORVVRI
65PQLQFRPSDUHGWRQHWSURILWRI65PQLQ7KLVZDVPDLQO\
GXHWRORVVHVLQLQYHVWPHQWVLQ(J\SW65PQDQGWKH8665PQ
UHGXFWLRQLQYDOXHRILQYHQWRU\65PQDQGSURYLVLRQIRU]DNDWUHODWHGWR
SUHYLRXV\HDU65PQ
x Recent developments
)LWDLKL¶V%2'DSSURYHGDLQFUHDVHLQWKHFRPSDQ\
VFDSLWDOWR65PQ
PQVKDUHVIURP65PQPQVKDUHVE\JUDQWLQJRQHERQXVVKDUH
IRUHYHU\VKDUHVRZQHG
17.2
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$+)&2$%
ZZZILWDLKLJURXSFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
10
YoY
(%)
10
1$
10
CAGR (%)
(08-11)
10
1$
10
0D\
6HS
7$6,
-DQ
0D\
)LWDLKL5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
$KPHG+XVVDLQ$KPHG)LWDLKL
6RXUFH7DGDZXO1&%&5HVHDUFK
83
5(7$,/~0$<
$/.+$/((-75$,1,1*
$/62.12:1$6$/.+$/((-
Established in 1992, Alkhaleej Training and Education
Company (Alkhaleej) conducts training programs in the fields
of IT, electronics and English language, and also offers
administrative and financial services. It operates more than 82
branches in the KSA, and has presence in over 19 locations in
the Middle East and nine facilities outside the region.
NOT COVERED
Current price (SR)
35.9
3ULFLQJDVRI
x Business brief
$ONKDOHHMLPSOHPHQWVWUDLQLQJSURJUDPVWKURXJKYDULRXVGLYLVLRQVLQFOXGLQJ STOCK DETAILS
1HZ+RUL]RQVFHQWHUVIRUFRPSXWHUOHDUQLQJDQGWKHODUJHVWLQGHSHQGHQW,7 ZHHNUDQJH+/65
0DUNHWFDSPQ
WUDLQLQJFRPSDQ\LQWKH.6$'LUHFW(QJOLVKFHQWHUV3ODWLQXPFHQWHUIRU
6KDUHVRXWVWDQGLQJPQ
DGYDQFHGWUDLQLQJVROXWLRQV±RIIHUVDGYDQFHGFRPSXWHUFRXUVHV7DNQLDW
Price perform (%) 1M
IRUWUDLQLQJEXVLQHVVDQGSURIHVVLRQDOGHYHORSPHQWVSHFLDOL]HVLQ
$EVROXWH
PDQDJHPHQWWUDLQLQJ.DZDGHUHPSOR\VJUDGXDWHVRIWKHFRPSDQ\¶V
0DUNHW
SURJUDPV(/HDUQLQJSURYLGHVRYHUFRXUVHVRQOLQHDQG$O'KLDID
6HFWRU
KRVSLWDOLW\DQGWRXULVPWUDLQLQJ
x Financials
$ONKDOHHM¶VUHYHQXHJUHZ<R<WR65PQLQRQKLJKHUVDOHVLQ
WKHJRYHUQPHQWVHFWRU(%,'7$LQFUHDVHG<R<WR65PQKRZHYHU
(%,7'$PDUJLQVGHFOLQHGWRLQIURPGXHWRKLJKHU
RSHUDWLQJH[SHQVHV1HWLQFRPHJUHZ<R<WR65PQLQPDLQO\
RZLQJWRULVHLQSURILWVIURPVXEVLGLDULHVDQGHGXFDWLRQSURMHFWV
3M
12M
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$/.+/((-$%
ZZZDONKDOHHMFRPVD
WEIGHTING & FREEFLOAT (%)
x Recent developments
2Q$SULO$ONKDOHHM¶VERDUGDSSURYHGGLVWULEXWLRQRIFDVKGLYLGHQGRI
RIFDSLWDOIRU,QDGGLWLRQWKHERDUGJUDQWHGDSSURYDOIRULQFUHDVLQJ
WKHVKDUHFDSLWDORIWKHFRPSDQ\E\WR65PQE\LVVXLQJERQXV
VKDUHVLQWKHUDWLRRI,Q-XO\$ONKDOHHMVLJQHGDORDQDJUHHPHQW
ZRUWK65PQZLWK5L\DGK%DQNWRIXQGWKHFRQVWUXFWLRQRIDGPLQLVWUDWLYH
RIILFHVLQ5L\DGK7KHORDQZRXOGEHUHSDLGLQVHPLDQQXDOLQVWDOOPHQWVRI
65PQIURP'HFHPEHU
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0D\
6HS
7$6,
-DQ
0D\
$ONKDOHHM7UQJ5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
$EGXOD]L]5DVKLG$EGXO$O5DVKLG
$KPHG$OL$KPHG$O6KDGZL
()*+HUPHV8$(/WG
$O:DOHHG$EGXO6DOHK$O'UHLDQ
$EGXOD]L]+DPDDG1$O%HODLKLG
6RXUFH7DGDZXO1&%&5HVHDUFK
84
5(7$,/~0$<
1$7,21$/$*5,&8/785(
$/62.12:1$67+,0$5
National Agriculture Marketing Co (THIMAR), established in
1987 and headquartered in Riyadh, manufactures, procures,
processes and markets agricultural products, accessories,
meat and other supplies through various dealers. The
company, which holds a 100% stake in Wasmi Meat, runs 23
stores in Saudi Arabia.
NOT COVERED
Current price (SR)
27.8
3ULFLQJDVRI
x Business brief
7+,0$5SULPDULO\VHOOVDJULFXOWXUDODQGPHDWSURGXFWVWRLWVFOLHQWVIURP
GLIIHUHQWVHFWRUVVXFKDVKRWHOVUHVWDXUDQWVDQGWKHPLOLWDU\7KHFRPSDQ\
DOVRSURYLGHVVHUYLFHVIRUWKHRSHUDWLRQPDQDJHPHQWDQGPDUNHWLQJRI
DJULFXOWXUDOSURMHFWV,WDOVRXQGHUWDNHVZKROHVDOHDQGUHWDLOWUDGLQJRI
DJULFXOWXUDODQGPHDWSURGXFWV
x Financials
7+,0$5¶VUHYHQXHVIHOO<R<WR65PQLQ(%,'7$IRUWKH\HDU
GHFUHDVHG<R<WR65PQ+RZHYHUWKHFRPSDQ\UHSRUWHGDQHW
LQFRPHRI65PQLQFRPSDUHGWRDQHWORVVRI65PQLQGXH
WRJDLQ65PQUHDOL]HGIURPWKHVDOHRIODQGLQ-HGGDK
x Recent developments
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
,Q'HFHPEHU7+,0$5¶VERDUGDSSURYHGUHGXFWLRQLQVKDUHFDSLWDOIURP
65PQWR65PQKRZHYHUWKLVLVDZDLWLQJDSSURYDOIURPWKH(*0
,QWKHVDPHPRQWKWKHFRPSDQ\VROGVTPHWUHVRIODQGLQ-HGGDK
WKURXJKDQDXFWLRQZLWKDJURVVVDOHYDOXHRI65PQ7KHFRPSDQ\
UHDOL]HGD65PQFDSLWDOJDLQIURPWKHVDOH
6(
%ORRPEHUJFRGH
7+,0$5$%
ZZZWKLPDUFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
10
10
10
10
10
CAGR (%)
(08-11)
10
10
10
10
0D\
$XJ
7$6,
1RY
)HE
0D\
7KLP
DU5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
6RXUFH7DGDZXO1&%&5HVHDUFK
85
5(7$,/~0$<
(;75$
$/62.12:1$68(&8QLWHG(OHFWURQLFV&RPSDQ\
Established in 1994, Extra (UEC, United Electronics Company)
is the largest consumer electronics retailer in Saudi Arabia.
Extra provides electronic, household and communication
devices as well as related solutions and services. The
company serves around 90% of customers in Saudi Arabia
annually, with more than 12,000 products across 25 stores.
x Business brief
NOT COVERED
Current price (SR)
88.0
3ULFLQJDVRI
([WUDLVHQJDJHGLQWKHUHWDLOWUDGLQJRIFRQVXPHUHOHFWURQLFVDQGKRPH
DSSOLDQFHV,WRIIHUVDOOOHDGLQJLQWHUQDWLRQDOEUDQGVDQGVWRFNVDQH[WHQVLYH
SURGXFWUDQJH7KHSURGXFWUDQJHLVVXSSRUWHGE\FRPSUHKHQVLYHDIWHUVDOHV
VHUYLFHVWKURXJKLWVWUDGHPDUNµ)RUFH¶ZLWKWKUHHGHGLFDWHGVHUYLFH
FHQWHUVDFURVVWKH.LQJGRP,WKDVVWRUHVZKLFKLQFOXGHVHYHQLQ5L\DGK
WKUHHLQ-HGGDKWZRLQ'DPPDPDQGRQHHDFKLQ0DNNDK0DGLQDK$O
.KREDUDQG$O+DVVD
x Financials
([WUD¶VUHYHQXHJUHZ<R<WR65PQLQPDLQO\GXHWRWKH
FRQWLQXHGH[SDQVLRQRILWVVWRUHQHWZRUNIURPLQWRLQDV
ZHOODVLQFUHDVHLQPDUNHWVKDUHOHGE\SURPRWLRQDODFWLYLW\DPLGVWHDG\
JURZWKLQGHPDQGIRUHOHFWURQLFGHYLFHVDQGVPDUWSKRQHV(%,'7$URVH
<R<WR65PQLQIURP65PQLQ$VDUHVXOWQHW
LQFRPHLQFUHDVHG<R<WR65PQGXULQJWKH\HDU
x Recent developments
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
$EVROXWH
0DUNHW
6HFWRU
SR
US$
Avg daily turnover (mn)
12M
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
(;75$$%
ZZZH[WUDFRPVD
WEIGHTING & FREEFLOAT (%)
([WUDVLJQHGD-9ZLWK$O0HHUD+ROGLQJ4DWDULQ)HEUXDU\WRRSHQLWV
ILUVWELJER[VWRUHLQ4DWDUGXULQJ([WUDZRXOGIRUPDOLPLWHGOLDELOLW\
FRPSDQ\ZLWKDQLQLWLDOFDSLWDOLQYHVWPHQWRI45
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
10
CAGR (%)
(08-11)
10
'HF
-DQ )HE
7$6,
0DU
$SU 0D\
([WUD5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
$O)R]DQ+ROGLQJ&RPSDQ\ $EGXOD]L]$OVDJK\LU&RPPHUFLDO 6RXUFH7DGDZXO1&%&5HVHDUFK
86
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Energy & Utilities
Ticker
Company
Page No.
5110
Saudi Electricity
90
2080
GASCO
91
0$<
(1(5*<87,/,7,(6
3ULPDU\IRFXV±3RZHUDQG:DWHU
6DXGL$UDELD¶VSRZHUVHFWRULVEHLQJPDLQO\GULYHQE\VXVWDLQHG
H[SDQVLRQDU\SROLFLHVULVLQJLQIUDVWUXFWXUHLQYHVWPHQWDQG
SRSXODWLRQJURZWK$FFRUGLQJWRWKH0LQLVWU\RI:DWHUDQG
(OHFWULFLW\WKHGHPDQGIRUSRZHULQWKH.LQJGRPLVOLNHO\WRJURZDW
DQDQQXDOUDWHRIXQWLOWKHUHE\LQFUHDVLQJWKHGHPDQG
WRDQHVWLPDWHG0:,QRUGHUWRFDWHUWRWKLVVWURQJGHPDQG
WKHJRYHUQPHQWLVLQYHVWLQJKHDYLO\LQWKHSRZHUVHFWRUDQGSODQV
WRDGGDSURGXFWLRQFDSDFLW\RI±0:HDFK\HDU
7KH6DXGL$UDELDQJRYHUQPHQWLVHQFRXUDJLQJPRUHSULYDWHVHFWRUSDUWLFLSDWLRQ
LQWKHSRZHUDQGGHVDOLQDWLRQVHFWRUV7KHLQLWLDOVHULHVRIWKHWKUHH,QGHSHQGHQW
3RZHU3URMHFWV,33VDZDUGHGE\6DXGL(OHFWULFLW\&RPSDQ\6(&2LV
VFKHGXOHGIRUFRPSOHWLRQE\7KHVHSURMHFWVFRPELQHGFDSDFLW\RI
0:ZHUHDQQRXQFHGLQDQGZRXOGEHEXLOWLQ5DELJK5L\DGKDQG
4XUD\\DK7ZRDGGLWLRQDO,33VDW4XUD\\DKDQG'KHEDDUHVFKHGXOHGWRFRPH
RQOLQHE\6HYHUDO,QGHSHQGHQW:DWHUDQG3RZHU3URMHFWV,:33VKDYH
DOVREHHQFRPPLVVLRQHGZLWKWKHPRVWSURPLQHQWRQHEHLQJGHYHORSHGE\
0DUDILT7KHJRYHUQPHQWLVVXSSRUWLQJWKLVPDVVLYHH[SDQVLRQE\LQFUHDVLQJ
DOORFDWLRQWRWKHZDWHUDQGLQIUDVWUXFWXUHVHFWRUVE\DERXWWR65EQ
Exhibit 68: Revenue of GCC energy and utilities
companies, 2009±11
Exhibit 69: Comparison of ROE, P/E & Mcap of GCC
companies, 2011
86'PQ
3(
52(
.6$
.XZDLW
6RXUFH7DGDZXO=DZ\D1&%&5HVHDUFK
4DWDU
8$(
2PDQ
.6$
.XZDLW
4DWDU
8$(
2PDQ
6RXUFH7DGDZXO=DZ\D1&%&5HVHDUFK
7KH6DXGL6WRFN([FKDQJH7DGDZXOFXUUHQWO\KDVWZRFRPSDQLHVWUDGLQJ
XQGHUWKH(QHUJ\8WLOLWLHVVHFWRU6DXGL(OHFWULFLW\&RPSDQ\6(&2DQG
1DWLRQDO*DVDQG,QGXVWULDOL]DWLRQ&R1*,&6(&2LVRQHRIWKHKHDY\ZHLJKWV
LQWKHPDUNHWDFFRXQWLQJIRUDERXWRIWKH7$6,¶VIUHHIORDW
6(&2KDVDQHDUPRQRSRO\LQ6DXGL$UDELD¶VHOHFWULFLW\VHFWRU$IWHUWKHGHOD\
LQLPSOHPHQWDWLRQRI6(&2
VUHVWUXFWXULQJDQGSULYDWL]DWLRQSODQLV
H[SHFWHGWRJRDKHDGLQ$VSDUWRIWKHUHVWUXFWXULQJSODQWKHFRPSDQ\
ZRXOGEHVSOLWLQWRIRXUSRZHUJHQHUDWLRQXQLWVRQHGLVWULEXWLRQILUPDQGRQH
WUDQVPLVVLRQILUPZKLOH6(&2ZRXOGRSHUDWHDVDKROGLQJFRPSDQ\,Q
WKHFRPSDQ\¶VUHYHQXHJUHZ<R<WR65EQZKLOHQHWSURILWIHOO
<R<WR65EQ1*,&¶VUHYHQXHVURVH<R<WR65EQGXULQJWKH\HDU
ZKLOHQHWSURILWLQFUHDVHGWR65PQIURP65PQLQ
88
(1(5*<87,/,7,(6
1&%&$3,7$/
0$<
Exhibit 70: Sector details
8QLWVDVVWDWHG
% weight in Index
as on 28 Mar 2012
Country
6DXGL(OHFWULFLW\&R6(&
1DWLRQDO*DV,QGXVWULDOL]DWLRQ&R1*,&
NIM (%),
2011
Avg. RoE (%),
2011
6RXUFH%ORRPEHUJ7DGDZXO&RPSDQ\GDWD
Exhibit 71: Revenue of companies, 2009±11
Exhibit 72: Profitability of SECO, relative to sector avg
65PQ
6(&2
1*,&
6HFWRU$YH UDJH
6RXUFH7DGDZXO1&%&5HVHDUFK
6(&2
6RXUFH7DGDZXO1&%&5HVHDUFK
7KH.LQJGRPLVNHHQWRUHGXFHLWVGHSHQGHQFHRQIRVVLOIXHOVDQGGHYHORS
DOWHUQDWLYHHQHUJ\VRXUFHVVXFKDVVRODUK\GURDQGQXFOHDUSRZHU.LQJ
$EGXOODK&LW\IRU5HQHZDEOH(QHUJ\.$&5(SODQVWRLQFUHDVHWKHVKDUHRI
DOWHUQDWLYHIXHOVLQWKH.LQJGRP¶VHQHUJ\PL[IURP]HURDWSUHVHQWWRE\
DQGE\
1&%&5HFRPPHQGDWLRQVLQWKH6HFWRU
:HDUHFDXWLRXVO\SRVLWLYHRQWKHVHFWRUJLYHQWKHLQFUHDVHGGHPDQGIRUSRZHU
:HFXUUHQWO\DUHQHXWUDORQ6DXGL(OHFWULFLW\
Exhibit 73: Coverage stocks details
Stock
Current Rating
6DXGL
(OHFWULFLW\
6(
1HXWUDO
PT (SR)
Comments
7KHQHZWDULIIVWUXFWXUHRQLQGXVWULDOFRPPHUFLDODQGJRYHUQPHQWFXVWRPHUVFDPHLQWR
HIIHFWRQ-XO\7KLVKDGDVLJQLILFDQWLPSDFWRQWKHFRPSDQ\¶VSURILWDELOLW\
ZKLFKZHEHOLHYHWKHPDUNHWKDVDOUHDG\SULFHGLQWRWKHVWRFN*RLQJIRUZDUGWKHNH\
ULVNVLQFOXGHULVLQJFRVWRIHQHUJ\SXUFKDVHGIURPLQGHSHQGHQWSURGXFHUVDVZHOODVDQ
LQFUHDVHLQGHSUHFLDWLRQH[SHQVH
6RXUFH1&%&5HVHDUFK
89
87,/,7,(6~0$<
6$8',(/(&75,&,7<
$/62.12:1$66(&6(&2
Saudi Electricity Company (SEC) is the largest power
generator in Saudi Arabia. Established in 2000, the company
is engaged in the generation, transmission and distribution of
electric power across the Kingdom. SEC was formed through
the consolidation of 10 regional electricity companies.
OVERWEIGHT
Current price (SR)
3ULFLQJDVRI
x Business brief
6(&KDVDPRQRSRO\LQWKHWUDQVPLVVLRQDQGGLVWULEXWLRQRIHOHFWULFLW\LQ
STOCK DETAILS
6DXGL$UDELDDQGDQHDUPRQRSRO\LQJHQHUDWLRQ7KHFRPSDQ\DOVRH[SRUWV ZHHNUDQJH+/65
DQGLPSRUWVHQHUJ\DQGLQYHVWVLQYDULRXVSRZHUSURMHFWVLQWKH.LQJGRP
0DUNHWFDSPQ
6(&KDGDWRWDODYDLODEOHFDSDFLW\RIPHJDZDWWV0:DWWKHHQGRI
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
x Financials
x Recent developments
1M
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
6(&SODQVWREXLOGD0:KHDY\IXHORLOEXUQLQJSODQWWREHFDOOHG
-HGGDK6RXWK7KHRLOILUHGSRZHUSODQWLVH[SHFWHGWREHFRPSOHWHGE\
7$6,IUHHIORDWZHLJKW
2011
2012E
2013E
YoY
(%)
CAGR (%)
(10-13E)
6(&2$%
ZZZVHFRPVD
WEIGHTING & FREEFLOAT (%)
)UHHIORDW
VALUATION MULTIPLES
10A
11A
12E
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
SHARE PRICE PERFORMANCE
Company financials
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6(
2Q0DUFK6(&DQQRXQFHGWKDWLWKDGEHHQJUDQWHGDORDQRI
86'EQWRILQDQFHWKHFRQVWUXFWLRQRILWVVL[WKSRZHUSODQWLQ5DELJK7KH
ORDQZRXOGEHUHSDLGLQVHPLDQQXDOLQVWDOOPHQWVRYHUDSHULRGRI\HDUV
2010
12M
0DUNHW
%ORRPEHUJFRGH
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
3M
5HXWHUVFRGH
7RPHHWWKHJURZLQJGHPDQG6(&SODQVWRVHWXSSRZHUWUDQVSRUWOLQHV
JDVSRZHUHGJHQHUDWLQJXQLWVDQGWUDQVIRUPHUVLQGLIIHUHQWSDUWVRIWKH
.LQJGRP,QOLQHZLWKWKLVWKHFRPSDQ\VLJQHGFRQWUDFWVZRUWK65EQLQ
'HFHPEHU
$EVROXWH
5HYHQXHVJUHZ<R<WR65PQLQPDLQO\GULYHQE\WKH
LQFUHDVHLQFRQVXPSWLRQGXHWRULVLQJGHPDQGIRUHOHFWULFLW\DQGH[SDQVLRQRI
FDSDFLW\DFURVVWKH.LQJGRP1HWSURILWFDPHLQDW65PQGRZQ
7KLVZDVPDLQO\GXHWRWKHULVHLQWKHFRVWRISXUFKDVHGHQHUJ\DQGKLJKHU
WKDQH[SHFWHGGHSUHFLDWLRQ
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
13.2
0D\ $XJ 1RY )HE 0D\
7$6,
6DXGL(OHFWULFLW\5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
*RYHUQPHQWRZQHUVKLSLQ6(&
&DSLWDO
$5$0&2
3XEOLF
6RXUFH7DGDZXO1&%&5HVHDUFK
90
87,/,7,(6~0$<
1$7,21$/*$6
,1'8675,$/,=$7,21&203$1<
$/62.12:1$6*$6&2
National Gas & Industrialization Company (GASCO) was
established in 1963 through the merger of two companies.
GASCO is engaged in filling, refilling and distributing liquefied
petroleum gas (LPG); designing and building gas networks;
and selling as well as installing gas tanks and cylinders.
NOT COVERED
Current price (SR)
22.5
3ULFLQJDVRI
x Business brief
*$6&2VHOOV/3*JDVF\OLQGHUVLQDQGOLWHUVL]HVDFURVV6DXGL
$UDELD7KHFRPSDQ\DOVRSURYLGHVYDULRXVW\SHVRIJDVWDQNVDQGUHODWHG
DFFHVVRULHV2ILWVWRWDOFDUULHUVDERXWKDYHDFDSDFLW\RIOLWHUV
HDFKZKLOHWKHUHPDLQLQJKDYHFDSDFLW\LQWKHUDQJHRI±
OLWHUV7KHFRPSDQ\¶VILOOLQJSODQWVDUHORFDWHGLQ5L\DGK-HGGDK'DPPDP
$O0DGLQDK7DLI%XUHLGDKDQG.KDPLV0XVKDLW*$6&2DOVRGHVLJQVDQG
LQVWDOOVJDVQHWZRUNVIRUUHWDLODQGLQGXVWULDOFXVWRPHUV
x Financials
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
*$6&2¶VUHYHQXHVJUHZWR65PQLQIURP65PQLQ
1HWLQFRPHIRUWKH\HDULQFUHDVHGWR65PQIURP65PQ
1HWLQFRPHJUHZGXHWRSURILWIURPWKHVDOHRIWKHFRPSDQ\¶VLQYHVWPHQWLQ
EDQNVDQGRWKHUQRQFRUHLQYHVWPHQWV
x Recent developments
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
1*,&$%
ZZZJDVFRFRPVD
*$6&2DQQRXQFHGDFDVKGLYLGHQGRI65SHUVKDUHIRURQ0DUFK
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
SHARE PRICE PERFORMANCE
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0D\ $XJ 1RY )HE 0D\
7$6,
*DV,QGXVWULDOL]DWLRQ5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
6DHHG$OL*KDGUDQ$O*KDPGL
3XEOLF,QYHVWPHQW)XQG
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
91
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Agriculture & Food
Ticker
Company
Page No.
2050
Savola Group
95
2280
Almarai
96
6090
Jazan Development
97
2270
SADAFCO
98
6010
NADEC
99
6002
Herfy Foods
100
6070
Jouff Agriculture
101
6020
Qassim Agriculture
102
4061
Anaam International
103
6001
Halwani Bros
104
6050
Saudi Fisheries
105
2100
Wafra Food
106
6040
Tabuk Agriculture
107
6060
Sharqiya Dev Co.
108
$SULO
$*5,&8/785()22'
([SRVXUHWRJOREDOIRRGSULFHVDFRQFHUQ
6DXGL$UDELDLVWKHODUJHVWIRRGPDUNHWLQWKH*&&DFFRXQWLQJIRU
RIWRWDOIRRGFRQVXPSWLRQLQ7KH.LQJGRP¶VIRRG
PDUNHWLVHVWLPDWHGWREHZRUWK65EQLQLQFUHDVLQJWR
65EQLQDFFRUGLQJWR(,8HVWLPDWHV)DFWRUVVXFKDV
6DXGL$UDELD¶VUHODWLYHO\ODUJHDQG\RXQJGHPRJUDSKLFVRI
WKHSRSXODWLRQLVXQGHU\HDUVRIDJHDQGULVLQJSHUFDSLWD
LQFRPHDUHWKHNH\ORQJWHUPGHPDQGGULYHUV+RZHYHUWKH
FRXQWU\¶VUHOLDQFHRQLPSRUWHGIRRGDQGLWVLQDELOLW\WRSDVVRQWKH
LQFUHDVHGFRVWWRFRQVXPHUVUHPDLQWKHPDLQFRQFHUQV
6DXGL)RRGPDUNHWWKHODUJHVWLQWKH*&&
%\IDUWKH6DXGL)RRGDQG$JULFXOWXUHVHFWRULVWKHODUJHVWLQWKH*&&ODUJHO\
RIIWKHEDFNRIDURXQGRIWKHSRSXODWLRQRIWKH*&&EHLQJEDVHGLQ6DXGL
$UDELD,QWHUPVRIOLVWHGFRPSDQLHVDJDLQWKHUHYHQXHVJHQHUDWHGE\6DXGL
FRPSDQLHVH[FHHGHG86'EQLQFRPSDUHGWROHVVWKDQ86'PQLQ
RWKHUPDMRU*&&FRXQWULHV
Exhibit 74: Revenue of listed GCC agri. companies
Exhibit 75: Comparison of ROE & P/E of GCC Cos, 2011
86'PQ
52(
.XZDLW
8$(
4DWDU
3([
6RXUFH7DGDZXO%ORRPEHUJ1&%&5HVHDUFK
.6$5+6
.6$
.XZDLW
8$(
4DWDU
6RXUFH7DGDZXO%ORRPEHUJ1&%&5HVHDUFK
+LJKGHSHQGHQFHRQIRRGLPSRUWV
$FFRUGLQJWRWKH6DXGL3RUWV$XWKRULW\6DXGL$UDELDLPSRUWHGPQWRQVRIIRRG
LWHPVLQHTXLYDOHQWWRRIWKHWRWDOYROXPHFRQVXPHGLQ6DXGL$UDELD
DQGXSIURPPQWRQVLQ7KHUHOLDQFHRQLPSRUWVLVGXHWRWKHVFDUFLW\RI
ZDWHUDQGDGYHUVHZHDWKHUFRQGLWLRQVZKLFKPDNHGRPHVWLFDJULFXOWXUDO
SURGXFWLRQGLIILFXOW$W65EQLQIRRGDQGDJULFXOWXUDOLPSRUWVDFFRXQWHG
IRURIRYHUDOOLPSRUWVLQWR.6$DQGJUHZE\<R<$FFRUGLQJWRWKH
(FRQRPLVW,QWHOOLJHQFH8QLW(,8IRRGLPSRUWVDUHVHWWRPRUHWKDQGRXEOHWR
65EQLQ*LYHQLWVUHOLDQFHRQLPSRUWVWKH.LQJGRPUHPDLQV
YXOQHUDEOHWRDULVHLQJOREDOIRRGSULFHV
$OPDUDLDQG6DYRODNH\VWRFNVLQWKHIRRGVHFWRU
2IWKHFRPSDQLHVLQWKHVHFWRU$OPDUDLDQG6DYRODDUHE\IDUWKHODUJHVW
ZLWKDPDUNHWFDSLWDOL]DWLRQRI65EQDQG65EQUHVSHFWLYHO\RI
WKHWRWDOVHFWRUPDUNHWFDSLWDOL]DWLRQ7KHVHDFFRXQWHGIRUDQG
UHVSHFWLYHO\RIWKH7DGDZXODVRI$SULO
5HYHQXHIRUWKHVHFWRULQFUHDVHG<R<WR65EQLQZKLOHWKH
LQGXVWU\¶VQHWHDUQLQJVURVH<R<WR65EQ6DYRODUHFRUGHG<R<
93
$*5,&8/785()22'
1&%&$3,7$/
$35,/
UHYHQXHJURZWKDQGD<R<LQFUHDVHLQHDUQLQJV7KHJRRGSHUIRUPDQFH
ZDVPDLQO\EDVHGRQLQFUHDVHGPDUNHWVKDUHDQGLQFUHDVHGPDUJLQVDWLWVIRRG
UHWDLOEXVLQHVV$OPDUDL¶VUHYHQXHVLQFUHDVHGGXULQJWKH\HDUDOWKRXJK
UHSRUWHGQHWLQFRPHGHFOLQHE\GXHPDLQO\WRDSURYLVLRQRQLWV=DLQ.6$
KROGLQJ+RZHYHUH[FOXGLQJRQHRIIJDLQVORVVHV6DYROD¶VQHWLQFRPHJUHZ
LQZKLOH$OPDUDL¶VQHWLQFRPHJUHZ<R<GXULQJWKH\HDU
Exhibit 76: Revenue of listed companies,
2009±2011
Exhibit 77: Savola - Profitability relative to sector
average
65PQ
6DYROD
$OPDUD L
2WKHUV
6RXUFH7DGDZXO%ORRPEHUJ1&%&5HVHDUFK
6HFWRU$YH UDJH
6DYROD
6RXUFH7DGDZXO%ORRPEHUJ1&%&5HVHDUFK
/RQJWHUPJURZWKGULYHUVLQWDFWVWDEOHIRRGSULFHVNH\WR
SURILWDELOLW\LQQHDUWRPHGLXPWHUP
:HH[SHFW6DXGL$UDELD¶VIDYRUDEOHGHPRJUDSKLFVWRFRQWLQXHGULYLQJWKH
VHFWRU¶VJURZWK7KH.LQJGRP¶VUHODWLYHO\ODUJHSRSXODWLRQORZSHUFDSLWDIRRG
FRQVXPSWLRQULVLQJLQFRPHOHYHOVDQGLQFUHDVHGUHOLJLRXVSLOJULPVZLOOFRQWLQXH
GULYLQJJURZWKLQWKHVHFWRU+RZHYHU.6$¶VRQJRLQJGHSHQGHQFHRQLPSRUWHG
IRRGDQGWKHSKDVLQJRXWRIVXEVLGLHVE\WKHJRYHUQPHQWDUHULVNVIRUWKHVHFWRU
%RWKOLVWHGDQGSULYDWHFRPSDQLHVLQWKHVHFWRUDUHDWWHPSWLQJWRPLWLJDWHWKHVH
ULVNVE\H[SDQGLQJJHRJUDSKLFDOO\DVZHOODVLQYHVWLQJLQDJULFXOWXUDOSURMHFWVLQ
OHVVGHYHORSLQJFRXQWULHV
1&%&UHFRPPHQGDWLRQ
:HDUHFDXWLRXVO\RSWLPLVWLFDERXWWKHVHFWRU¶VSHUIRUPDQFHLQWKHORQJWHUP:H
EHOLHYHPRVWRIWKHGHPDQGIRUWKHVHFWRULVORFDOO\GULYHQDQGWKHUHIRUHOLNHO\WR
UHPDLQVWURQJGHVSLWHRQJRLQJJOREDOFKDOOHQJHV+RZHYHUWKH.LQJGRP¶V
GHSHQGHQFHRQLPSRUWHGIRRGLVDNH\ZHDNQHVV1HYHUWKHOHVVLQWKHVKRUWUXQ
WKHPRGHUDWHJOREDORXWORRNIRUZLOOOLNHO\HQVXUHWKDWFRPPRGLW\
SULFHVZLOOEHXQGHUSUHVVXUHDOORZLQJPDUJLQH[SDQVLRQ:HFXUUHQWO\UDWH
6DYRODDVRYHUZHLJKWDVZHEHOLHYHWKHPDUJLQH[SDQVLRQSRWHQWLDODWWKHUHWDLO
EXVLQHVVLVVLJQLILFDQWZLWKWKHIRRGEXVLQHVVFRQWLQXLQJWRJURZLWVYROXPHV
:HDUHFXUUHQWO\QHXWUDORQ$OPDUDLJLYHQRXUFRQFHUQVRQWKHUHWXUQRQ
LQYHVWPHQWIURPWKHSRXOWU\EXVLQHVVDORQJVLGHWKHWLPHLWZLOOWDNHIRUWKHQHZ
EXVLQHVVHVWREHFRPHSURILWDEOH
Exhibit 78: Coverage stocks details
Stock
Current Rating
6DYROD
6(
2YHUZHLJKW
$OPDUDL
1HXWUDO
6(
PT (SR)
Comments
)RRGUHWDLOEXVLQHVVLVH[SDQGLQJDJJUHVVLYHO\ZLWKPDUJLQVH[SHFWHGWRLQFUHDVHDV
EX\LQJSRZHUVWUHQJWKHQV)RRGEXVLQHVVFRQWLQXHVWRWDNHPDUNHWVKDUHDQGH[SDQG
JHRJUDSKLFDOO\DFURVVWKHUHJLRQ0RYHWRD³KROGLQJFRPSDQ\´PD\XQORFNYDOXH
*HRJUDSKLFH[SDQVLRQRIWKHEDNHU\DQGMXLFHEXVLQHVVHVDQGWKHVWDUWRIRSHUDWLRQVDW
WKHQHZSRXOWU\YHQWXUHDUHNH\GULYHUVIRUWKHVWRFN2XUFRQFHUQVDUHRQWKHSDFHRI
SURJUHVVDWSRXOWU\DVZHOODVWKHUHWXUQVZKLFKFDQEHJDLQHGRQWKLV65EQLQYHVWPHQW
6RXUFH1&%&5HVHDUFK
94
$*5,&8/785()22'_0$<
6$92/$*5283
$/62.12:1$66$92/$
6DYRODLVRQHRIWKHOHDGLQJIRRGFRPSDQLHVLQWKH0(1$
UHJLRQZLWKRSHUDWLRQVVWUHWFKLQJIURP0RURFFRWR
.D]DNKVWDQ7KHFRPSDQ\LVZHOOSRVLWLRQHGWREHQHILWIURP
WKHJURZWKLQPDVVJURFHU\UHWDLOLQWKHUHJLRQDVZHOODV
LQFUHDVHGVSHQGLQJRQIRRG6DYROD¶VPRYHWRZDUGVD
µ)LQDQFLDO+ROGLQJ&RPSDQ\¶VWUXFWXUHPD\XQORFNVRPHRI
WKHFRQJORPHUDWHGLVFRXQWFXUUHQWO\SUHVHQWLQWKHVWRFN
/LPLWHGDELOLW\WRSDVVRQWKHULVHLQUDZPDWHULDOSULFHVWR
FRQVXPHUVLVDNH\ULVN
x %XVLQHVVEULHI
6DYROD¶VEXVLQHVVLQWHUHVWVDUHGLYLGHGLQWRWKUHHVHJPHQWV6DYROD)RRGV
HGLEOHRLOVVXJDUDQGSDVWD6DYROD5HWDLO3DQGDDQG+\SHU3DQGDDQG
6DYROD3ODVWLF:LWKPRUHWKDQRXWOHWVDFURVVWKH.6$6DYRODHQMR\VD
OHDGLQJSRVLWLRQLQUHWDLOLQJ6DYRODKDVPDMRULQYHVWPHQWVLQ$OPDUDL'DLU\
&R+HUI\)RRGV&R.LQDQDQG$OH[DQGULD6XJDU
DPRQJRWKHUV7KHFRPSDQ\LVDOVRRQHRIWKHIRXQGLQJ
VKDUHKROGHUVRI.(&LQ0DGLQDKDQG.$(&LQ5DELJK.6$
x )LQDQFLDOV
6DYROD¶VUHYHQXHVJUHZWR65EQLQIURP65EQWKH
SUHYLRXV\HDUGULYHQE\PDUNHWVKDUHJDLQVLQWKHIRRGDQGUHWDLOGLYLVLRQDV
ZHOODVFRQWLQXHGJHRJUDSKLFH[SDQVLRQV1HWLQFRPHURVH<R<WR
65EQGXULQJWKH\HDUGXHWRRQHRIIJDLQVIURPWKHVDOHRIODQGGXULQJ
4DVRSSRVHGWRRQHRIIORVVHVLQWKHIRUPRILPSDLUPHQWGXULQJWKHODVW
TXDUWHURI$GMXVWLQJIRUWKHVHQHWLQFRPHLQFUHDVHGDWDVORZHUSDFH
RI<R<WR65PQDVQHWPDUJLQGHFOLQHGIURPLQWR
LQGXHWRKLJKHUILQDQFLDOFKDUJHV
x 5HFHQWGHYHORSPHQWV
,Q$SULO6DYRODDFTXLUHGDQGVWDNHVLQLWVVXEVLGLDULHV86&
.6$DQG86&((J\SWUHVSHFWLYHO\IURP8.EDVHG7DWH/\OH,Q
'HFHPEHULWDQQRXQFHGWKHVDOHRILWVVWDNHVLQYDULRXVODQGVDQG
ERXJKWWKHUHPDLQLQJVWDNHLQDSDVWDFRPSDQ\LQ(J\SW
29(5:(,*+7
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6$92/$$%
ZZZVDYRODFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
(
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
0D\
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
$GMXVWHG1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
6HS
7$6,
-DQ
0D\
6$92/$*URXS5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
0RKDPPHG,EUDKLP0RKDPPHG
$O(VVD
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
$EGXOODK0RKDPPHG$EGXOODK$O
5DEHDK
$EGXO4DGHU$O0XKDLGLEDQG
6RQV&R
6RXUFH7DGDZXO1&%&5HVHDUFK
95
$*5,&8/785( )22' ~0$<
$/0$5$, &203$1<
$/62.12:1$6$/0$5$,
$OPDUDLLVWKHOHDGLQJGDLU\FRPSDQ\LQWKH0LGGOH(DVW
5HFHQWO\$OPDUDLH[SDQGHGLQWRIUXLWMXLFHEDNHU\SRXOWU\
DQGLQIDQWPLONDVLWVHHNVWREHFRPHWKHOHDGLQJIRRG
FRPSDQ\LQWKHUHJLRQ.H\FDWDO\VWVIRUWKHFRPLQJ\HDU
LQFOXGHWKHSDFHRISURJUHVVLQLWVQHZSRXOWU\EXVLQHVVDV
ZHOODVH[SDQVLRQRIMXLFHDQGEDNHU\LQWRWKHUHVWRIWKH*&&
x %XVLQHVV EULHI
1(875$/
&XUUHQWSULFH65 3ULFLQJDVRI
$OPDUDL¶V SURGXFW UDQJH LQFOXGHVIUHVK DQG ORQJOLIH GDLU\ SURGXFWVVHYHUDO
672&. '(7$,/6
IUXLW MXLFHIODYRUV FKHHVH DQGEXWWHU DQG EDNHU\ SURGXFWV7KH FRPSDQ\
ZHHNUDQJH+/65
UHFHQWO\HQWHUHG WKH SRXOWU\DQG LQIDQW PLONPDUNHWV7KH FRPSDQ\H[SHFWVWR
0DUNHWFDSPQ
LQFUHDVH WKHSRXOWU\ RXWSXW FDSDFLW\ILYHIROG WRPQ ELUGVSHU \HDU E\
6KDUHVRXWVWDQGLQJPQ
DQG PQ ELUGV E\ WKHWULDORSHUDWLRQ RI ,QIDQW 0LONDQG LQWHJUDWLRQ RI
3ULFHSHUIRUP 0
WKHUHFHQWO\ DFTXLUHG )RQGRPRQWH LVDQWLFLSDWHG LQ
$EVROXWH
x )LQDQFLDOV
$OPDUDL¶V UHYHQXHV JUHZ <R<WR65EQ LQ OHG E\KLJKHU
PDUNHWVKDUH DFURVVNH\SURGXFWV GLYHUVLILFDWLRQ DQG IRFXV RQSURGXFW
LQQRYDWLRQ VHUYLFH DQG TXDOLW\+RZHYHU JURZWK ZDVORZHU YV WKHDYHUDJH
RI RYHU WKHODVWILYH \HDUV)UXLW-XLFH DQG %DNHU\ VHJPHQWVUHJLVWHUHG
WKHVWURQJHVW JURZWK RI DQG UHVSHFWLYHO\ GXULQJ WKH\HDU$GMXVWHG
QHWLQFRPH JUHZ MXVW<R<WR65EQ DVPDUJLQV FDPH XQGHU SUHVVXUH
GXH WRKLJKHU FRPPRGLW\SULFHVDQG OLPLWHGSULFLQJ SRZHU 0DQDJHPHQW
H[SHFWV± <R<JURZWK LQUHYHQXH LQ
x 5HFHQWGHYHORSPHQWV
2Q $SULO $OPDUDL DSSURYHG D LQFUHDVH LQVKDUH FDSLWDOWKURXJK
ERQXV VKDUHV 2Q0DUFK LWUDLVHG LWVVWDNHLQ,QWHUQDWLRQDO 'DLU\
DQG -XLFH IURP WR ,QWKH VDPHPRQWK$OPDUDL DQQRXQFHG WKH
FRPSOHWLRQ RI LWVILUVWVXNXNIRU 65EQ ,Q -DQXDU\ LWDQQRXQFHG DWULDO
UXQ DWWKHORFDOSURGXFWLRQ IDFLOLW\IRU ,QIDQW 0LONKDVEHHQ VFKHGXOHG GXULQJ
0DUFK±0D\ ,Q 'HFHPEHU $OPDUDL DQQRXQFHG WKH IXOODFTXLVLWLRQ
RI )RQGRPRQWH 6$$UJHQWLQD IRU 65PQ
0
0
0DUNHW
6HFWRU
$Y JGDLO\WXUQRY HUPQ
0
65
86
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$/0$5$,$%
ZZZDOPDUDLFRP
:(,*+7,1* )5(()/ 2$7 7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,21 08/7,3/(6
$
$
(
3([
3%[
36[
'LY<LHOG
'36
6RXUFH 1&%&5HVHDUFKHVWLPDWHV
6+$5( 35,&( 3(5)250$ 1&(
&RP SDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
(
6RXUFH &RPSDQ\ 1&%&5HVHDUFK A9DULQGLFDWHV YDULDQFH IURP1&%&IRUHFDVWV
(
<R<
&$*5
(
0D\
6HS
7$6,
-DQ
0D\
$OPDUDL5+6
6RXUFH %ORRPEHUJ
7236+$5(+2/ '(56 6DYROD*URXS
++3ULQFH6XOWDQELQ0RKDPPHG
6DXG$O.DELU$O6DXG
2PUDQ0RKDPPHG$O2PUDQDQG
&RPSDQ\
6RXUFH 7DGDZXO 1&%&5HVHDUFK
96
$*5,&8/785( )22' ~0$<
-$=$1'(9(/230(17
$/62.12:1$6-$=$'&2
-D]DQ'HYHORSPHQW&R-$=$'&2 LVKHDGTXDUWHUHGLQ
-D]DQ7KHFRPSDQ\ZDVHVWDEOLVKHGLQWRFRQGXFW
DJULFXOWXUHDQGDTXDFXOWXUHDFWLYLWLHVLQ.6$-$=$'&2¶V
VXEVLGLDULHVLQFOXGH)LVK+DWFKHULHV&RPSDQ\ -DQQDW
$JULFXOWXUDO,QYHVWPHQW&RPSDQ\ DQG7DEXN)LVKHULHV
&RPSDQ\ x %XVLQHVV EULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
-$=$'&2¶V SULQFLSDO DFWLYLWLHV FRPSULVH RZQHUVKLS DQG RSHUDWLRQ RI ILVK
VKULPS DQG IUXLW IDUPVLQYHVWPHQW LQUHDO HVWDWHDQG DJULFXOWXUDO VHFWRUV
SURGXFWLRQ RI PLQHUDO ZDWHU DQG VHDIRRG GLVWULEXWLRQ RI LQGXVWULDOHOHFWULFDO
DQG IRRG UHWDLOHTXLSPHQW DQG UHDO HVWDWHGHYHORSPHQW LQFOXGLQJ
HVWDEOLVKPHQW DQG RSHUDWLRQ RI LQGXVWULDO SURMHFWV7KH FRPSDQ\ VHOOV
SURGXFWV DFURVV6DXGL $UDELD DVZHOODVH[SRUWV WRRWKHU FRXQWULHVLQ *&&
(XURSH DQG )DU(DVW-$=$'&2 KDV DQDQQXDO SURGXFWLRQ FDSDFLW\RI
WRQVRI VKULPSPQ OLWHUVRI PLQHUDO ZDWHU DQG WRQVRIPDQJRHV
x )LQDQFLDOV
5HYHQXHV GHFOLQHG <R<WR65PQ LQ +RZHYHU (%,7'$ IHOO
VLJQLILFDQWO\ WRUHSRUW DORVVRI65PQ GXH WRORZ SURGXFWLRQ DQG KLJK FRVWRI
VKULPS RZLQJ WRLQIHFWLRQ LQWKHIDUP GXH WRWKH ZKLWH VSRWV\QGURPH YLUXV
1HWORVVLQFUHDVHG WR65PQ IURP 65PQ LQ GXH WRWKH GURS LQ
7DEXN )LVKHULHV &RPSDQ\¶V VKDUH FDSLWDO-D]DGFR KROGV DVWDNHDQG
ORVVHVIURP WKHVDOHRI 6HORQGD 8.
672&. '(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$Y JGDLO\WXUQRY HUPQ
65
0
86
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
*,=$&2$%
ZZZMD]DGFRFRPVD
:(,*+7,1* )5(()/ 2$7 x 5HFHQWGHYHORSPHQWV
2Q -DQXDU\ WKHFRPSDQ\ DQQRXQFHG DORVVRI 65PQ IURP WKH
VDOHRI 6HORQGD 8.LWVRZQHG VXEVLGLDU\ IRU DWRWDOYDOXH RI
*%3PQ
2Q 'HFHPEHU -$=$'&2 ILOHG DODZVXLW DJDLQVW WKHIRUPHU %RDUG
RI 'LUHFWRUV RI 7DEXN )LVKHULHV&RPSDQ\ IRU QRW IROORZLQJ FRPSDQ\
SURFHGXUHV WKDWOHG WRORVVHVRI 65PQ WKH FRPSDQ\KDG WRUHGXFH LWV
VKDUH FDSLWDOE\ WR65PQ WRFRYHU WKHVHORVVHV
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,21 08/7,3/(6
$
$
$
3([
10
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH 1&%&5HVHDUFKHVWLPDWHV
6+$5( 35,&( 3(5)250$ 1&(
&RP SDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH 7DGDZXO =DZ\D &RPSDQ\ 1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
-D]DQ'HYHORSPHQW5+6
6RXUFH %ORRPEHUJ
7236+$5(+2/ '(56 6RXUFH 7DGDZXO 1&%&5HVHDUFK
97
$*5,&8/785()22'_0$<
6$8',$'$,5<$1')22'678))
&203$1<
$/62.12:1$66$'$)&2
-HGGDKEDVHG6DXGLD'DLU\DQG)RRGVWXII&RPSDQ\
6$'$)&2IRFXVHVRQGDLU\SURGXFWV,WFRPPHQFHG
RSHUDWLRQVLQDQGKDVVLQFHGLYHUVLILHGLWVSURGXFWOLQH
E\HQWHULQJLQWRMRLQWYHQWXUHVZLWKRWKHUIRRGFRPSDQLHV
6$'$)&2¶VSRUWIROLRFRPSULVHVPRUHWKDQSURGXFWVVROG
XQGHUWKH6$8',$EUDQG
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
6$'$)&2RSHUDWHVWKURXJKILYHPDLQVHJPHQWV0LON-XLFHV6QDFNV,FH
&UHDPDQG2WKHU)RRGLWHPV8QGHUWKH0LONGLYLVLRQ6$'$)&2RIIHUVD
ZLGHUDQJHRIPLONSDFNVPLONSRZGHUFKHGGDUFKHHVHDQGPLONVKDNHV7KH
,FH&UHDPVHJPHQWVHOOVDQXPEHURILFHFUHDPIODYRUVZKLOHWKH2WKHU)RRG
VHJPHQWSURGXFHVWRPDWRNHWFKXSDQGSDVWHDVZHOODVKXPPXV
x )LQDQFLDOV
6$'$)&2¶VUHYHQXHVJUHZ<R<WR65PQLQGXHWRD
UREXVWJURZWKLQFRUHFDWHJRULHVLQFOXGLQJPLONDQGLFHFUHDPDORQJZLWK
VXFFHVVIXOQHZLQQRYDWLRQV(%,7'$JUHZ<R<WR65PQLQ
7KHFRPSDQ\UHSRUWHGDQHWLQFRPHRI65PQLQFRPSDUHGWR
65PQLQZKLFKZDVGXHWRH[FHSWLRQDOJDLQVIURPVDOHRI
LQYHVWPHQW
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
2Q)HEUXDU\6$'$)&2¶V%RDUGRI'LUHFWRUVDSSURYHGWKH
HVWDEOLVKPHQWRID65PQUHJLRQDOGLVWULEXWLRQFHQWHULQ5L\DGKZKLFKLV
H[SHFWHGWRVWDUWRSHUDWLRQVE\2Q6HSWHPEHU6$'$)&2
DQQRXQFHGSODQVWRUHDFWLYDWHWKH'DPPDPIDFWRU\WRH[SDQGSURGXFWLRQ
FDSDFLW\DQGPHHWWKHH[SHFWHGFRQVXPHUGHPDQG
6$'$)&2$%
ZZZVDGDIFRFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6+$5(35,&(3(5)250$1&(
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK<HDUHQG0DUFK
<R<
10
&$*5
10
0D\
6HS
7$6,
-DQ
0D\
6$'$)&25+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
8QLWHG0DQXIDFWXULQJ&R
$O6DPK7UDGLQJ/WG
*OREDO,QYHVWPHQW+RXVH
6RXUFH7DGDZXO1&%&5HVHDUFK
98
$*5,&8/785()22'~0$<
1$7,21$/$*5,&8/785(
$/62.12:1$61$'(&
1DWLRQDO$JULFXOWXUH'HYHORSPHQW&RPSDQ\1$'(&
FRPPHQFHGRSHUDWLRQVLQZLWKDJRYHUQPHQWVWDNH
7KHFRPSDQ\IRFXVHVRQDJULFXOWXUDOSURGXFWLRQIRRG
SURFHVVLQJDQGGLVWULEXWLRQ1$'(&RSHUDWHVWKURXJKWKUHH
EXVLQHVVVHJPHQWVDJULFXOWXUDOGDLU\DQGMXLFHSURGXFWV
7KHFRPSDQ\VHOOVSURGXFWVXQGHUWKH1$'(&EUDQG
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
1$'(&RIIHUVDZLGHUDQJHRISURGXFWVXQGHUHDFKRILWVRSHUDWLQJ
VHJPHQWV7KHFRPSDQ\SURYLGHVPDQXIDFWXUHGSURGXFWVVXFKDVWRPDWR
SDVWHJUDLQVYHJHWDEOHVIUXLWVIRGGHUROLYHVDQGKRQH\XQGHUWKH
DJULFXOWXUDOVHJPHQW7KHGDLU\SURGXFWVVHJPHQWRIIHUVORQJOLIHSURGXFWV
LQFOXGLQJFKHHVHDQGPLONGHVVHUWVDQGVSHFLDOSURGXFWV7KHMXLFH
VHJPHQWRIIHUVDUDQJHRIIUHVKDQGORQJOLIHMXLFHVLQFRQWDLQHUVRIYDULRXV
VL]HV1$'(&KDVDQDQQXDOSURGXFWLRQFDSDFLW\RIWRQVRI
SRWDWRHVWRQVRIZKHDWWRQVRIZKHDWVHHGVOLWHUVRI
ROLYHRLOWRQVRIDOIDOIDWRQVRIRQLRQWRQVRIGDWHV
WRQVRIPDL]HWRQVRIKRQH\DQGWRQVRIJUDLQPDL]H7KH
FRPSDQ\DOVRSURGXFHVOLWHUVRIGDLU\SURGXFWVSHUGD\1$'(&
RSHUDWHVILYHDJULFXOWXUDOSURMHFWVVL[FDWWOHIDUPVDQGWZRPRGHUQGDLU\
SODQWVDFURVV6DXGL$UDELD
x )LQDQFLDOV
672&.'(7$,/6
ZHHNUDQJH+/65
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
x 5HFHQWGHYHORSPHQWV
2Q0DUFKWKHFRPSDQ\UHFRPPHQGHGWKHGLVWULEXWLRQRI
FDVKGLYLGHQGV65SHUVKDUHIRU
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
1$'(&$%
ZZZQDGHFFRPVD
1$'(&¶VUHYHQXHVLQFUHDVHG<R<WR65PQLQ7KH
FRPSDQ\¶V(%,7'$JUHZ<R<WR65PQGXULQJWKH\HDU$VD
UHVXOW(%,7'$PDUJLQH[SDQGHGWRIURPLQ1$'(&
EHQHILWHGIURPDUHFRYHU\LQWKHDJULFXOWXUDODQGGDLU\VHJPHQWVYLVjYLVWKH
SUHYLRXV\HDUDQGDQLPSURYHPHQWLQHIILFLHQF\WKURXJKFRVWFRQWURO
SURJUDPV7KHFRPSDQ\¶VQHWLQFRPHURVHWR65PQGXULQJWKH\HDU
FRPSDUHGWRDSURILWRI65PQLQ
0DUNHWFDSPQ
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10 3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
-DQ
7$6,
0D\
1$'(&5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
3XEOLF,QYHVWPHQW)XQG
6DOHK$EGXO$]L]6DOHK$O5DMKL
$EGXOODK$EGXO$]L]6DOHK$O5DMKL
6XODLPDQ$EGXO$]L]6DOHK$O5DMKL
6RXUFH7DGDZXO1&%&5HVHDUFK
99
$*5,&8/785( )22' ~0$<
+(5)<)22'6(59,&(6
$/62.12:1$6+(5)<
(VWDEOLVKHGLQ+HUI\)RRG6HUYLFHV&RPSDQ\+HUI\
KDVDFKDLQRIIDVWIRRGUHVWDXUDQWVDVZHOODVSDVWU\EDNHU\
DQGFKRFRODWHVKRZURRPVDFURVV6DXGL$UDELD+HUI\LV
.6$¶VODUJHVWIRRGFKDLQZLWKRYHUIDVWIRRGUHVWDXUDQWV
SDVWU\DQGFKRFRODWHVKRZURRPVDQGRQHPHDWSURFHVVLQJ
SODQW
x %XVLQHVV EULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
+HUI\ RSHUDWHV IDVWIRRG UHVWDXUDQWV IRRG UHWDLO RXWOHWVEDNHULHV DQG
FKRFRODWH VKRZURRPV 7KH FRPSDQ\ LVDOVRHQJDJHG LQPHDW SURFHVVLQJ,WV
FRPELQHG SURGXFWLRQ FDSDFLW\RI VZHHWVDQG EDNHU\ SURGXFWV VWDQGVDW
WRQVSHU DQQXP DQG IUR]HQ PHDWFDSDFLW\DW WRQVD \HDU
672&. '(7$,/6
ZHHNUDQJH+/65
+HUI\¶V UHYHQXHV JUHZ WR65PQ LQ IURP 65PQ LQ
ODUJHO\ GXH WRWKHRSHQLQJ RI QHZ UHVWDXUDQWV GXULQJ WKH\HDU DQG WKHILUVW
EUDQFK RI WKH +HUI\ &DIH *ULOOUHVWDXUDQW LQ4 1HWLQFRPH LQFUHDVHG
<R<WR65PQ LQ DVWKHFRPSDQ\ LPSURYHG RSHUDWLQJ
HIILFLHQF\ WKURXJK FRVWFRQWUROV WKHUHE\ OLPLWLQJWKHLPSDFWRI KLJKHU UDZ
PDWHULDO SULFHV&RVWFRQWDLQPHQW DOVROLPLWHGWKHLPSDFWRQ PDUJLQV
UHVWULFWLQJ WKHGHFOLQH²(%,7'$ PDUJLQ VWRRGDWDQG QHW PDUJLQ DW
GXULQJ WKH \HDUDVFRPSDUHG WRDQG UHVSHFWLYHO\ LQ
x 5HFHQWGHYHORSPHQWV
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
x )LQDQFLDOV
0DUNHWFDSPQ
0
0
$EVROXWH
0DUNHW
6HFWRU
$Y JGDLO\WXUQRY HUPQ
0
65
86
0
5HXWHUVFRGH
0
6(
%ORRPEHUJFRGH
+(5)<$%
ZZZKHUI\FRP
:(,*+7,1* )5(()/ 2$7 2Q 0DUFK +HUI\ DQQRXQFHG WKDWWKH$*0ZRXOG EHKHOG WR
DSSURYH WKHGLVWULEXWLRQ RI FDVKGLYLGHQG 2Q$XJXVW +HUI\
DQQRXQFHG LWKDG VHFXUHG D65PQ ORDQ IURP WKH 6DXGL,QGXVWULDO
'HYHORSPHQW )XQG WRILQDQFH LWVFDNHDQG SDVWU\SODQW SURMHFWH[SHFWHG WR
VWDUWSURGXFWLRQ LQWKHFRPLQJ VL[PRQWKV
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,21 08/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH 1&%&5HVHDUFKHVWLPDWHV
6+$5( 35,&( 3(5)250$ 1&(
&RP SDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
+HUI\)RRGV5+6
6RXUFH %ORRPEHUJ
7236+$5(+2/ '(56 6DYROD*URXS
$KPHG+DPDG0RKDPPHG$O
6DLG
6RXUFH 7DGDZXO 1&%&5HVHDUFK
6RXUFH 7DGDZXO =DZ\D &RPSDQ\ 1&%&5HVHDUFK 100
$*5,&8/785( )22' _0$<
$/-28)$*5,&8/785(
$/62.12:1$6$/-28)-$'&2
$O-RXI$JULFXOWXUH'HYHORSPHQW&R$O-RXIZDVHVWDEOLVKHG
LQ+HDGTXDUWHUHGLQ$O-RXIWKHFRPSDQ\SURFHVVHV
DQGVHOOVDJULFXOWXUDO DQGDQLPDOSURGXFWV$O-RXIVHOOV
DFURVV6DXGL$UDELDDVZHOODVQHLJKERULQJFRXQWULHVWKURXJK
LWVPDUNHWLQJRXWOHWV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVV EULHI
$O-RXI¶V FRUH DFWLYLWLHV DUH SURFHVVLQJ DQG PDUNHWLQJ DJULFXOWXUDO DQG DQLPDO
SURGXFWV 7KH FRPSDQ\¶V SURGXFW SRUWIROLR LQFOXGHV SRWDWRHV DQG SRWDWR
VHHGVRQLRQ DQG RQLRQ VHHGVDQG IUXLWVVXFKDVSHDFKHV SOXPVDSSOHV DSULFRWVDQG JUDSHV ,WDOVRRIIHUV SURGXFWV VXFKDVROLYH RLOKRQH\ GDWHV
ZKHDW EDUOH\ DQG DOIDOID IRGGHU IRU OLYHVWRFN DQG IRGGHU GHDOHUV 2WKHU
SURMHFWVXQGHUWDNHQ E\WKHFRPSDQ\ LQFOXGH PLONSURGXFWLRQ DQG SURFHVVLQJ
XQGHU WKH EUDQG $O6DIZD 'DLULHV DQG VKHHS EUHHGLQJ DQG IDWWHQLQJ x )LQDQFLDOV
5HYHQXHV LQFUHDVHG WR65PQ IURP 65PQ LQ 7RSOLQH
JURZWK ZDVVXSSRUWHG E\KLJKHU VDOHV)XUWKHUPRUH (%,7'$ PDUJLQ
LPSURYHG WR GXULQJ WKH\HDU IURP LQ DLGHG E\DGHFOLQH LQ
WKHVKDUH RI FRVWRI VDOHVLQWRWDOUHYHQXHV &RQVHTXHQWO\ QHW LQFRPHJUHZ
WR65PQ LQ IURP 65PQ LQ 672&. '(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
0DUNHW
6HFWRU
$Y JGDLO\WXUQRY HUPQ
0
65
86
0
$EVROXWH
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
2Q 0DUFK WKH%RDUG RI 'LUHFWRUV DQQRXQFHG WKDWWKH$*0ZRXOG
EH KHOGRQ $SULO WRDSSURYH WKH GLVWULEXWLRQ RI FDVKGLYLGHQG RI
65 SHU VKDUH IRU 2Q 'HFHPEHU WKH *RYHUQRU RI $O-RXI
3ULQFH )DKG ELQ%DGU LQDXJXUDWHG WKH2OLYH ,QGXVWULDO &RPSOH[ LQ WKH%DVWD
DUHD 7KH IDFWRU\ LVH[SHFWHG WRKDYH DGDLO\SURGXFWLRQ FDSDFLW\RI WRQV
RI ROLYH
-$'&2$%
ZZZDOMRXIFRPVD
:(,*+7,1* )5(()/ 2$7 7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,21 08/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH 1&%&5HVHDUFKHVWLPDWHV
&RP SDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5( 35,&( 3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH 7DGDZXO =DZ\D &RPSDQ\ 1&%&5HVHDUFK
<R<
10
&$*5
0D\
6HS
7$6,
-DQ
0D\
-RXII$JULFXOWXUH5+6
6RXUFH %ORRPEHUJ
7236+$5(+2/ '(56 6RXUFH 7DGDZXO 1&%&5HVHDUFK
101
$*5,&8/785()22'_0$<
4$66,0$*5,&8/785(
$/62.12:1$6*$&2
4DVVLP$JULFXOWXUH&R*$&2HVWDEOLVKHGLQDQG
KHDGTXDUWHUHGLQ4DVVLPLQYHVWVLQDJULFXOWXUDODQGOLYHVWRFN
EXVLQHVVHV,WKDVWZREXVLQHVVGLYLVLRQV)DUPLQJDQG
0DQXIDFWXULQJ*$&2LVHQJDJHGLQDJULFXOWXUDODQGDQLPDO
IDUPLQJKDUYHVWLQJDQGLPSRUWLQJRIJUDLQVDQGVHHGV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
*$&2PDLQO\XQGHUWDNHVFURSSURGXFWLRQIRRGSURFHVVLQJDQGDQLPDO
IDUPLQJDFWLYLWLHV7KHFRPSDQ\SURGXFHVWRQVRIGDWHVWRQVRI 672&.'(7$,/6
FRUQDQGWRQVRIZKHDWDQQXDOO\*$&2LVDOVRDGLVWULEXWRURIGDWHV ZHHNUDQJH+/65
DQGGDLU\SURGXFWV7KHFRPSDQ\LQYHVWVLQWKHFRQVWUXFWLRQRIFRROLQJVWRUHV
0DUNHWFDSPQ
DVZHOODVWUDQVSRUWDWLRQDQGLPSRUWRIIRGGHUFHUHDOVDQGDJULFXOWXUDO
6KDUHVRXWVWDQGLQJPQ
HTXLSPHQWWRPHHWLQWHUQDOUHTXLUHPHQWV
3ULFHSHUIRUP
x )LQDQFLDOV
$EVROXWH
*$&2¶VUHYHQXHVIHOO<R<WR65PQLQ7KHFRPSDQ\
UHSRUWHGORZHUORVVHV65PQLQ(%,7'$GXULQJWKH\HDU1HWORVVIRUWKH
\HDUVWRRGDW65PQFRPSDUHGWRORVVHVRI65PQLQGXHWR
LPSURYHGOHYHOVRISURGXFWLYLW\IRUZKHDWDQGPDL]HDQGUHVWUXFWXULQJRI
SURMHFWV)XUWKHUPRUHWKHRSHUDWLQJHIILFLHQF\ZDVHQKDQFHGGXHWR
DGPLQLVWUDWLYHDQGWHFKQLFDOVNLOOVWKDWKHOSHGLQUHVROYLQJPDQ\LVVXHV
2Q$SULO*$&2DQQRXQFHGWKDWWKHFKDQJHLQWKHFRPSDQ\
VQDPH
IURP
$O4DVVLP$JULFXOWXUDO&RPSDQ\
WR
$O4DVVLP+ROGLQJ
ZRXOGEH
FRQVLGHUHGLQWKHXSFRPLQJ(*02Q$SULO*$&2DQQRXQFHGWKH
ILOLQJRIDODZVXLWDJDLQVW1DMGL\DK0DUNHWLQJ&RPSDQ\IRUEUHDFKRIWHUPVRI
WKHOHDVHDJUHHPHQWRIWKHFRPSDQ\
VGDLU\IDFWRU\2Q-XO\WKH
FRPSDQ\OHDVHGRXWLWVSRXOWU\SURMHFWWR1DWLRQDO3RXOWU\&RPSDQ\IRUD
SHULRGRI\HDUVDQGDWRWDOYDOXHRI65PQ
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
4$$&2$%
ZZZJDFRFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
4DVVLP$JULFXOWXUH5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
6RXUFH7DGDZXO1&%&5HVHDUFK
102
$*5,&8/785()22'~0$<
$1$$0,17(51$7,21$/
$/62.12:1$6$1$$0
(VWDEOLVKHGLQ$QDDP,QWHUQDWLRQDOLVKHDGTXDUWHUHGLQ
-HGGDK6DXGL$UDELD7KHFRPSDQ\LPSRUWVSURGXFHVDQG
VHOOVIUR]HQIRRGDQGDQLPDOIHHG$QDDPDOVRLQYHVWVLQ
LQGXVWULDOSURMHFWVDQGOLYHVWRFNWUDGH7KHFRPSDQ\¶V
IDFWRULHVDQGSODQWVDUHORFDWHGLQ-RXIDQG4DVVLP
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
$QDDPLVHQJDJHGLQWKHLPSRUWH[SRUWVXSSO\WUDGHWUDQVSRUWDWLRQDQG
EUHHGLQJRIOLYHVWRFNLQ6DXGL$UDELD7KHFRPSDQ\DOVRWUDGHVLQPDULQH
672&.'(7$,/6
HTXLSPHQW2WKHUDFWLYLWLHVLQFOXGHSURGXFWLRQDQGWUDQVSRUWDWLRQRIPHDW
ZHHNUDQJH+/65
PDQDJHPHQWDQGRSHUDWLRQRIVODXJKWHUKRXVHVSURFHVVLQJRIPHDWLPSRUWV
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
ZKROHVDOHWUDGHRIIUR]HQIRRGSURGXFWLRQRIDQLPDOIHHGDQGLQYHVWPHQWVLQ
LQGXVWULDOSURMHFWV$QDDPKDVDSURGXFWLRQFDSDFLW\RIWRQVSHU\HDU
3ULFHSHUIRUP 0
RIDQLPDOIHHG7KHFRPSDQ\LVDOVRLQYROYHGLQUHDOHVWDWHGHYHORSPHQW
$EVROXWH
x )LQDQFLDOV
$QDDP¶VUHYHQXHVURVHWR65PQLQIURP65PQLQ
PDLQO\GXHWRWKHULVHLQWKHIRRGGLYLVLRQ¶VVDOHV7KHFRPSDQ\¶V
(%,7'$PDUJLQVQDUURZHGWRIURPLQ1HWSURILWLPSURYHG
<R<WR65PQLQ7KLVZDVDVFULEHGWRWKHFROOHFWLRQRISUHYLRXV
GHEWDQDGMXVWPHQWRI65PQLQSURYLVLRQVDQGDJDLQRI65PQIURPWKH
VDOHRISURSHUW\DQGHTXLSPHQW
x 5HFHQWGHYHORSPHQWV
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$1$$0$%
ZZZDQDDPFRPVD
2Q2FWREHUWKHFRPSDQ\DQQRXQFHGSODQVWRH[SDQGLWVGU\DQG
IUR]HQIRRGVEXVLQHVVHVDORQJZLWKWKHOLYHVWRFNIHHGXQLW
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
$QDDP+ROGLQJ5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
3ULQFH$EGXOODKELQ7XUNLELQ$EGXO
$]L]$O6DXG
6RXUFH7DGDZXO1&%&5HVHDUFK
103
$*5,&8/785( )22' ~0$<
+$/:$1,%527+(56
$/62.12:1$6+$/:$1, +%
+DOZDQL%URWKHUV&RPSDQ\+%SURGXFHVPDUNHWVDQG
GLVWULEXWHVIRRGSURGXFWVLQDQGRXWVLGH6DXGL$UDELD+%KDV
RYHUEUDQGVDQGSODQWVLQ6DXGL$UDELDDQG(J\SW
(VWDEOLVKHGLQWKHFRPSDQ\LVKHDGTXDUWHUHGLQ-HGGDK
6DXGL$UDELD 127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVV EULHI
+%SURGXFHV FKHHVHLFHFUHDPV IUR]HQ DQG SURFHVVHG PHDWMDPVJUDLQV
MXLFHVGDWHVDQG $UDELFVZHHWVDVZHOO DVPDQXIDFWXULQJ WLVVXHV7KH
FRPSDQ\ KDVWKHFDSDFLW\WRSURGXFH WRQVRI WDKLQD WRQVRI
$UDELF VZHHWV WRQVRI PHDW WRQVRI FKHHVH WRQVRI
$UDELF VZHHWV WRQVRI GDLU\ SURGXFWV DQG WRQVRI MDPSHU \HDU
x )LQDQFLDOV
672&. '(7$,/6
ZHHNUDQJH+/65
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
+%¶VUHYHQXHV JUHZ <R<WR65PQ LQ +RZHYHU WRSOLQH
JURZWK ZDVRIIVHW E\KLJKHU UDZ PDWHULDO FRVWV,QFUHDVHG FRVWRI VDOHV
ORZHUHG WKH (%,7'$ PDUJLQ ESVWR DVWKH FRPSDQ\GLG QRWSDVV
RQ KLJKHU FRVWVWRFRQVXPHUV (%,7'$ JUHZ MXVW<R<WR65PQ 1HW
LQFRPH URVHDPDUJLQDO WR65PQ LQ IURP 65PQ LQ
*URZWK LQUHYHQXHV ZDV DOVRLPSDFWHG E\DVORZGRZQ LQRSHUDWLRQV LQ(J\SW
GXH WRWKHSROLWLFDODQG HFRQRPLF FRQGLWLRQV LQWKHFRXQWU\
0DUNHWFDSPQ
0
0
$EVROXWH
0
0DUNHW
6HFWRU
$Y JGDLO\WXUQRY HUPQ
0
65
86
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
2Q $SULO +%DQQRXQFHG DGLYLGHQG RI 65SHU VKDUH IRU 2Q
0DUFK WKHFRPSDQ\ H[SDQGHG RSHUDWLRQV LQ(J\SWUDLVLQJ LWV
DQQXDO SURGXFWLRQ FDSDFLW\RI SURFHVVHG PHDW E\2Q$XJXVW +%VLJQHG DQ PRQWK FRQWUDFWZRUWK 65PQ ZLWK8QLRQ (QJLQHHULQJ
3URMHFWV&RPSDQ\ WRFRPSOHWHWKH FLYLO DQG VWHHOVWUXFWXUH ZRUN RI WKH
VHFRQG SKDVH RI WKHFRPSDQ\¶VLQGXVWULDO FRPSOH[
+%$%
ZZZKDOZDQLFRPVD
:(,*+7,1* )5(()/ 2$7 7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,21 08/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH 1&%&5HVHDUFKHVWLPDWHV
&RP SDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5( 35,&( 3(5)250$ 1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH 7DGDZXO =DZ\D &RPSDQ\ 1&%&5HVHDUFK <R<
10
&$*5
0D\
6HS
7$6,
-DQ
0D\
+%5+6
6RXUFH %ORRPEHUJ
7236+$5(+2/ '(56 'DODK,QGXVWULDO,QYHVWPHQW&R
0RKDPHG$EGHO+DPHHG
0DKPRRG+DOZDQL
6RXUFH 7DGDZXO 1&%&5HVHDUFK
104
$*5,&8/785()22'~0$<
6$8',),6+(5,(6
$/62.12:1$6$/$60$.6)&
'DPPDPEDVHG6DXGL)LVKHULHV&RPSDQ\6)&FRPPHQFHG
RSHUDWLRQVLQ:LWK$/$60$.DVLWVIODJVKLSEUDQGWKH
FRPSDQ\RSHUDWHVLQILVKLQJDTXDFXOWXUHDQGVHDIRRG
PDQXIDFWXULQJDQGGLVWULEXWLRQ6)&PDQXIDFWXUHVSURGXFWV
DWLWVSURFHVVLQJSODQWVDQGGHOLYHUVWKHPXVLQJLWVRZQIOHHW
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
6)&JHQHUDWHVUHYHQXHVIURPIRXURSHUDWLQJVHJPHQWV9DOXHDGGHG
3URGXFWVWRQVSURGXFWLRQFDSDFLW\,QGLYLGXDOO\4XLFN)UR]HQRU,4) 672&.'(7$,/6
3URGXFWVWRQVFDSDFLW\)LVK3URGXFWVDQGDQHZSURGXFWFDOOHG
ZHHNUDQJH+/65
$ODVPDN7XQD7KH9DOXHDGGHG3URGXFWVVHJPHQWFRPSULVHVILVKVWLFNV
0DUNHWFDSPQ
ILVKEXUJHUVVKULPSQXJJHWVNLQJVKULPSDQGJROGHQFULVS\VKULPS7KH,4)
6KDUHVRXWVWDQGLQJPQ
GLYLVLRQRIIHUV,4)VKULPSLQUHWDLOSDFNV$FRPSDQ\RZQHGFKDLQRIUHWDLO
3ULFHSHUIRUP 0
VKRSVDQGILVKVHUYLFHFRXQWHUVKDQGOHVWKHGLVWULEXWLRQSURFHVV7KH
$EVROXWH
FRPSDQ\RSHUDWHVIRXUSURFHVVLQJSODQWV'DPPDP-HGGDK-D]DQDQG
0DUNHW
5L\DGK
6HFWRU
x )LQDQFLDOV
0
0
$YJGDLO\WXUQRYHUPQ
6)&¶VUHYHQXHVGHFOLQHG<R<WR65PQLQFRPSDUHGWR
65PQLQPDLQO\GXHWRDGHFOLQHLQVKULPSIDUPSURGXFWLRQDVD
UHVXOWRIWKHZKLWHVSRWGLVHDVH(%,7'$ORVVHVLQFUHDVHGWR65PQ
FRPSDUHGWR65PQLQ)XUWKHUPRUHQHWORVVHVLQFUHDVHGWR65P
LQIURP65PQLQGXHWRWKHH[WUDRUGLQDU\ORVVHVLQFXUUHGRQ
DFFRXQWRIWKHGLVHDVHWKDWVSUHDGLQWKHVKULPSIDUP$VDUHVXOWDKXJH
VWRFNSLOHRIVKULPSVWRFNKDGWREHGLVFDUGHG
x 5HFHQWGHYHORSPHQWV
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6),&2$%
ZZZVDXGLILVKHULHVFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
2Q6HSWHPEHUDQLQFUHDVHLQWKHFRPSDQ\
VFDSLWDOWKURXJKD
ULJKWVLVVXHZDVDSSURYHGLQWKH(*0
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
6DXGL)LVKHULHV5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
3XEOLFLQYHVWPHQW)XQG
3ULQFH0HWH
HE%LQ$EGXO$]L]$O
6DXG
6RXUFH7DGDZXO1&%&5HVHDUFK
105
$*5,&8/785()22'_0$<
)22'352'8&76&203$1<
5L\DGKEDVHG)RRG3URGXFWV&RPSDQ\ZDVHVWDEOLVKHGLQ
WRSURYLGHIRRGSURGXFWVLQ6DXGL$UDELD7KHFRPSDQ\
IRFXVHVRQSURFHVVLQJPDUNHWLQJGLVWULEXWLQJDQGH[SRUWLQJ
YDOXHDGGHGIRRGLWHPV,WVWDUJHWPDUNHWVLQFOXGH$VLDDQG
WKH0LGGOH(DVW
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
)RRG3URGXFWV&RPSDQ\RSHUDWHVXQGHUWKHEUDQGQDPHµ:$)5$¶DQGKDV
DVWDNHLQ-DQQDW$JULFXOWXUDO,QYHVWPHQW&R7KHFRPSDQ\FODVVLILHV
LWVRSHUDWLRQVXQGHUIRXUEXVLQHVVVHJPHQWV0HDW)DFWRU\RIIHUVEHHIDQG
FKLFNHQEXUJHUVNHEDEVIUDQNIXUWHUV9HJHWDEOH)DFWRU\RIIHUVIUR]HQ
)UHQFKIULHVSRWDWRZHGJHVDQGDYDULHW\RISHDQXWV3DVWD)DFWRU\
SURGXFHVDZLGHUDQJHRISDVWDVXQGHUYDULRXVEUDQGVDQG%UHDNIDVW
&HUHDOVVXSSOLHVFRUQIODNHVIURVWHGIODNHVDQGULFHFULVSLHV
x )LQDQFLDOV
7KHFRPSDQ\¶VUHYHQXHVJUHZ<R<WR65PQLQ+RZHYHU
KLJKHUFRVWRIVDOHVDVDSHUFHQWDJHRIWRWDOUHYHQXHVGXHWRULVLQJUDZ
PDWHULDOSULFHVORZHUHGWKH(%,7'$<R<WR65PQGXULQJWKH\HDU
7KHFRPSDQ\¶VQHWLQFRPHGHFOLQHG<R<WR65PQLQGXHWR
KLJKHUJHQHUDODQGDGPLQLVWUDWLYHH[SHQVHVDQGORZHUUHQWLQFRPHDVLW
FRQFHGHGWKHULJKWRIUHQWDIWHULWVROGRQHRILWVEXLOGLQJSUHPLVHVIRU
65PQ
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
)3&2$%
ZZZZDIUDKFRP
x 5HFHQWGHYHORSPHQWV
:(,*+7,1*)5(()/2$7
2Q$SULOWKHFRPSDQ\DQQRXQFHGLWKDGVLJQHGDFRQWUDFWZLWK
7DEXN$JULFXOWXUDO'HYHORSPHQW&RPSDQ\IRU65PQWREX\SURFHVVHG
SRWDWRHV7KHFRPSDQ\DOVRDQQRXQFHGVLJQLQJD65PQFRQWUDFWZLWK
DQ,WDOLDQFRPSDQ\WRVXSSO\DQHZOLQHRISDVWDVDQGQRRGOHVZKLFKZRXOG
EHUHIOHFWHGLQLWVILQDQFLDOVWDWHPHQWVIRU42Q'HFHPEHUWKH
FRPSDQ\GHFODUHGLWKDGVLJQHGDPHPRUDQGXPRIXQGHUVWDQGLQJZLWK(DVW
$VLD&RPSDQ\WRFRQWULEXWH65PQWRWKHLQLWLDOFDSLWDORI$JULFXOWXUDO
'HYHORSPHQWDQG,QYHVWPHQW&RPSDQ\ZKLFKLVFXUUHQWO\LQWKHSURFHVVRI
EHLQJHVWDEOLVKHG
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
10
&$*5
10
0D\
6HS
7$6,
-DQ
0D\
)RRG5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$EGXOKDNHHP$2$O6KHLNK
6RXUFH7DGDZXO1&%&5HVHDUFK
106
$*5,&8/785()22'_0$<
7$%8.$*5,&8/785(
$/62.12:1$67$'&2
7DEXN$JULFXOWXUH'HYHORSPHQW&RPSDQ\7$'&2
HVWDEOLVKHGLQDQGKHDGTXDUWHUHGLQ7DEXNSULPDULO\
PDQXIDFWXUHVDQGPDUNHWVDJULFXOWXUDOSURGXFWV,WLVDOVR
HQJDJHGLQHQYLURQPHQWSURWHFWLRQDQGZDWHUUHVRXUFH
PDQDJHPHQW,WVSURGXFWVLQFOXGHIUXLWVYHJHWDEOHVIRUDJH
SURGXFWVJUDLQVVHHGVDQGSURFHVVHGSURGXFWVVXFKDV
ROLYHRLODQGKRQH\
x %XVLQHVVEULHI
7$'&2RSHUDWHVWKURXJKILYHEXVLQHVVXQLWV)RUDJHSURGXFHVDOIDOIDWRVHOO
PDLQO\WRGDLU\IDUPV2OLYHSURGXFHVDQGSURFHVVHVROLYHRLOWKURXJKROLYH
WUHHFXOWLYDWLRQ9HJHWDEOHPDLQO\\LHOGVDQGPDUNHWVRQLRQVDQGSRWDWRHV
)UXLWFXOWLYDWHVIUXLWVVXFKDVSHDFKHVDSULFRWVSOXPVQHFWDULQHVDQG
SHDUVDQG*UDLQSURGXFHVZKHDWDQGZKHDWVHHGV
x )LQDQFLDOV
7$'&2¶VUHYHQXHVLQFUHDVHG<R<WR65PQLQGXHWRKLJKHU
VDOHVSULFHUHDOL]DWLRQIRUVRPHSURGXFWV(%,7'$LPSURYHGVLJQLILFDQWO\E\
<R<WR65PQGXULQJWKHSHULRGDVFRVWRISURGXFWLRQGHFOLQHGIRU
VRPHRIWKHSURGXFWV&RQVHTXHQWO\QHWLQFRPHVXUJHG<R<WR
65PQLQ
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
ZZZWDGFRDJULFRP
2Q$SULO7$'&2DQQRXQFHGWKDWLWKDVVLJQHGD65PQFRQWUDFW
ZLWK)RRG3URGXFWV&RPSDQ\WRVHOOSURFHVVHGSRWDWRHV2Q$SULO
WKHFRPSDQ\LQIRUPHGLWKDGVLJQHGD65PQFRQWUDFWZLWK$O6DIL'DLU\
&RPSDQ\6DXGL$UDELDWRSURYLGHWKHODWWHUZLWKJUHHQIHHGIURP$SULOWR
1RYHPEHU2Q0DUFKWKHFRPSDQ\DQQRXQFHGWKDWLWKDG
VLJQHGD0HPRUDQGXPRI8QGHUVWDQGLQJWRVWDUWDGXHGLOLJHQFHZLWK1DML(O
'LQH*URXS0RURFFRIRUDFTXLULQJWKUHHRIWKHODWWHU
VVXEVLGLDULHV7KH
DFTXLVLWLRQZRXOGEHILQDQFHGE\WKHFRPSDQ\DQGLWVSDUWQHUV
7$$&2$%
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
7DEXN$JULFXOWXUH5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$EGXOODK$EGXO$]L]6DOHK$O5DMKL 6RXUFH7DGDZXO1&%&5HVHDUFK
107
$*5,&8/785( )22' ~0$<
$6+6+$54,<$+
$/62.12:1$66+$'&2
$VK6KDUTL\DK'HYHORSPHQW&RPSDQ\$VK6KDUTL\DKZDV
HVWDEOLVKHGLQDQGVHOOVPHDWDQGDJULFXOWXUDOSURGXFWV
7KHFRPSDQ\DOVRXQGHUWDNHVDJULFXOWXUDOSURMHFWVODQG
UHKDELOLWDWLRQDQGLUULJDWLRQZRUN$VK6KDUTL\DKRZQVVWDNHV
LQ$O+DVVD)RRG,QGXVWULHV8QLWHG'DLU\)DUPVDQG3XUH
%UHHG3RXOWU\
x %XVLQHVV EULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
$VK6KDUTL\DK LVHQJDJHG LQWKH SURGXFWLRQ DQGPDUNHWLQJ RI ZKHDW EDUOH\
IRGGHU FURSVVXFKDVDOIDOID DQG UKRGHV JUDVVZKHDW DQGEDUOH\ VWUDZDQG
SRWDWRHV 7KH FRPSDQ\ KDVDQ DQQXDO SURGXFWLRQ FDSDFLW\RI PLOOLRQ
WRQVRI PLON WRQVRI ZKHDW DQG NLORJUDPV RI KRQH\ 2WKHU
SURMHFWVXQGHUWDNHQ E\WKHFRPSDQ\ LQFOXGH EUHHGLQJ RI FDOI DQG VKHHS DQG
SURGXFWLRQ RI ELRIHUWLOL]HUV $VK6KDUTL\DK DOVRRZQV DVKRSSLQJ FHQWHU LQ
'DPPDP
x )LQDQFLDOV
7KH FRPSDQ\¶VUHYHQXHV GHFOLQHG <R<WR65PQ LQ +LJKHU
FRVWRI SURGXFWLRQ LQSXWVDQG ORZHU SURGXFWLYLW\ OHYHOV RI VRPHDJULFXOWXUDO
FURSVOHG WRDIDOO LQ(%,7'$ PDUJLQV WRIURP LQ
)XUWKHUPRUH KLJKHU DGPLQLVWUDWLYH DQG PDUNHWLQJ H[SHQVHV LQFUHDVHG
DQQXDO QHWORVVHVWR65PQ LQ IURP 65PQ WKHSUHYLRXV \HDU
x 5HFHQWGHYHORSPHQWV
672&. '(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
$EVROXWH
0
0DUNHW
6HFWRU
$Y JGDLO\WXUQRY HUPQ
0
65
86
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$6$&2$%
ZZZDVKDUTL\DKFRPVD
2Q 'HFHPEHU WKHVDOHRI WKHFRPSDQ\¶V RZQHG VXEVLGLDU\ $O
$KVD)RRG ,QGXVWULHV &RPSDQ\ ZDV DSSURYHG E\WKH%2' IRU DWRWDOYDOXH
RI 65PQ
:(,*+7,1* )5(()/ 2$7 7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,21 08/7,3/(6
$
$
$
3([
10
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH 1&%&5HVHDUFKHVWLPDWHV
&RP SDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5( 35,&( 3(5)250$ 1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH &RPSDQ\ 1&%&5HVHDUFK A9DULQGLFDWHV YDULDQFH IURP1&%&IRUHFDVWV
<R<
10
&$*5
10
0D\
6HS
7$6,
-DQ
0D\
(DVWHUQ$JULFXOWXUH5+6
6RXUFH %ORRPEHUJ
7236+$5(+2/ '(56 6RXUFH 7DGDZXO 1&%&5HVHDUFK
108
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Telecom
Ticker
Company
Page No.
7020
Etihad Etisalat
114
7010
STC
115
7030
Zain KSA
116
7040
Etihad Atheeb
117
7050
Saudi Integrated
118
0$<
7(/(&20
%URDGEDQGWRGULYHWKHQH[WSKDVHRIJURZWK
7KHOLEHUDOL]DWLRQRIWKHWHOHFRPVHFWRULQ6DXGL$UDELDVLQFH
KDVOHGWRVLJQLILFDQWJURZWKLQWKHVHFWRU7KHVHFWRU¶VVXEVFULEHU
EDVHKDVJURZQIURPPQLQWRPQLQ7KH
LQWURGXFWLRQRIPLGDQGORZHQGVPDUWSKRQHVLPSURYHGWHFKQLFDO
FDSDELOLW\FRXSOHGZLWKWKH\RXQJSRSXODWLRQRI6DXGL$UDELDKDV
OHGWRDQLQFUHDVHLQWKHPRELOHEURDGEDQGSHQHWUDWLRQUDWHWR
DWWKHHQGRIIURPLQ:HEHOLHYH
EURDGEDQGSRWHQWLDOUHPDLQVVLJQLILFDQWSUHVVXUHRQSULFLQJDQG
PDUJLQVDUHFRQFHUQV
6DXGL$UDELDUHPDLQVWKHODUJHVWPDUNHWIRUPRELOHVHUYLFHVLQWKH*&&ZLWKWKH
PRELOHSHQHWUDWLRQUDWHKDYLQJUHDFKHGDWWKHHQGRI:LWK
SHQHWUDWLRQUHDFKLQJWKLVOHYHOZHEHOLHYHWKHIRFXVRIRSHUDWRUVLVPRYLQJDZD\
IURPDFTXLULQJQHZLQFUHPHQWDOVXEVFULEHUVWRGHULYLQJPRUHYDOXHIURPH[LVWLQJ
VXEVFULEHUV7KHUHIRUHZHH[SHFWWKHSHQHWUDWLRQUDWHWRJURZDWDVORZHUSDFH
RI<R<LQ,QWHUQHWSHQHWUDWLRQUHDFKHGLQZLWKPQ
VXEVFULEHUVIURPSHQHWUDWLRQUDWHDQGPQVXEVFULEHUVLQZKLOH
EURDGEDQGVXEVFULEHUVDUHOLNHO\WRLQFUHDVHWRPQE\IURPPQDW
WKHHQGRI$WLQEURDGEDQGSHQHWUDWLRQLQ.6$ZDVVWLOO
EHORZWKDWLQ%DKUDLQ4DWDUDQGWKH8$(PRUHWKDQLQDOOWKUHHFRXQWULHV
.6$¶VIL[HGOLQHSHQHWUDWLRQLQFUHDVHGDOPRVWWRPQVXEVFULSWLRQVDW
WKHHQGRIIURPPDWWKHHQGRI*URZWKLQWKHVHJPHQWUHPDLQHG
VXEGXHGGXULQJ±ZLWKDKLJKHUQXPEHURISHRSOHSUHIHUULQJPRELOHV
DQGWKHFRUSRUDWHVHJPHQWUHPDLQLQJUHVWUDLQHGDPLGWKHJOREDOHFRQRPLF
GRZQWXUQ1HYHUWKHOHVVVXEVFULSWLRQVJUHZVLJQLILFDQWO\GXULQJODUJHO\
GXHWRWKHEXR\DQWFRQVWUXFWLRQDFWLYLWLHVLQWKHFRXQWU\DVZHOODVWKHHQWU\RI
QHZSOD\HUµ$WKHHE¶WKDWUHVXOWHGLQFRPSHWLWLRQOHGJURZWK2YHUWKHORQJHU
WHUPIDFWRUVVXFKDVUHGXFLQJKRXVHKROGVL]HJURZLQJSRSXODWLRQDQG
LQFUHDVHGGHPDQGIURPFRUSRUDWHVDUHH[SHFWHGWRGULYHIL[HGOLQHJURZWK
0DUJLQVWDELOLW\NH\WRRXWORRN
,QWKHWHOHFRPVHFWRULQ6DXGL$UDELDIDFHGPDUJLQSUHVVXUHPDLQO\WKH
LQWHUQDWLRQDOYRLFHVHJPHQW$FFHVVFKDUJHVZHUHWKHPDLQFRVWLWHPVGUDJJLQJ
WKHERWWRPOLQHZKLOHRWKHUJURVVDQGRSHUDWLQJFRVWVZHUHUHODWLYHO\ZHOO
PDQDJHGDFURVVWKHVHFWRU'HFOLQHLQ$538DVDUHVXOWRIWKHDJJUHVVLYH
SULFLQJSROLF\SXUVXHGE\=DLQ.6$H[HUWHGIXUWKHUSUHVVXUHRQPDUJLQV
+RZHYHUJRLQJIRUZDUGZHEHOLHYHFRPSDQLHVZRXOGFRQWLQXHWRIRFXVRQWKH
GDWDVHJPHQWSULPDULO\PRELOHEURDGEDQGDQGVXEVFULEHUFRQYHUVLRQVIURP
SUHSDLGWRSRVWSDLG7KLVLQWXUQZLOOVWDELOL]H$538DQGRIIVHWVRPHRIWKH
PDUJLQSUHVVXUH$FFRUGLQJWR&,7&GDWDNQHWDGGLWLRQVZHUHPDGHWRWKH
SRVWSDLGVXEVFULEHUEDVHLQFRPSDUHGWRMXVWNLQ
110
7(/(&20
1&%&$3,7$/
0$<
Exhibit 79: Fixed-line and mobile penetration rate
Exhibit 80: Broadband & internet penetration rate
)L[HGOLQH
0RELOH5+6
%URDGEDQG
6RXUFH(,8%0,,78&,7&DVSHUODWHVWGDWDDYDLODEOH
,QWHUQHW5+6
6RXUFH(,8%0,,78&,7&DVSHUODWHVWGDWDDYDLODEOH
7KHUDSLGJURZWKLQWKH6DXGL$UDELDQWHOHFRPPDUNHWKDVSRVLWLRQHGLWDVWKH
ODUJHVWLQWKH*&&LQUHYHQXHWHUPVLQ+RZHYHUWKHVHFWRUZDVEHKLQGLWV
*&&SHHUVLQWHUPVRIUHWXUQRQHTXLW\PDLQO\GXHWRWKHORVVHVLQFXUUHGE\
=DLQ.6$DQG$WKHHE7KHVHFWRULVWUDGLQJDWD3(PXOWLSOHRI[DERYHWKH
*&&DYHUDJHRI[
Exhibit 81: GCC THOFR¶VUHYHQXHV2009±11
Exhibit 82: GCC THOFR¶V5R(DQG3(FRPSDULVRQ1
86'PQ
52(
.6$
8$(
.XZDLW
4DWDU
2PDQ
%DKUDLQ
3([
.6$
6RXUFH5HXWHUV7DGDZXO%ORRPEHUJ
7KHFRPSDQLHVOLVWLVQRWH[KDXVWLYH
8$(
.XZDLW
4DWDU
2PDQ
%DKUDLQ
6RXUFH5HXWHUV7DGDZXO%ORRPEHUJ1&%&5HVHDUFK
6L]HRIWKHEXEEOHUHSUHVHQWVPDUNHWFDSDVRQ$SULO
6DXGLOLVWHGWHOHFRPVPDUNHW
67&LVWKHODUJHVWFRPSDQ\LQWKH.LQJGRP¶VWHOHFRPPXQLFDWLRQVHFWRUPDUNHW
FDSRI65EQDVRQ$SULOIROORZHGE\0RELO\PDUNHWFDSRI
65EQ=DLQKDGLWVLQLWLDOSXEOLFRIIHULQJLQDQGODXQFKHGFRPPHUFLDO
VHUYLFHVLQ$XJXVW$WKHHEOLVWHGLQ0DUFKZKLOH6DXGL,QWHJUDWHG
7HOHFRP&RPSDQ\PDGHLWVGHEXWRQWKHERXUVHLQ-XO\
Exhibit 83: Sector details
8QLWVDVLQGLFDWHG
Country
(WLKDG(WLVDODW&R0RELO\
6DXGL7HOHFRP&R67&
0RELOH7HOHFRPPXQLFDWLRQ&R=DLQ
$WKHHE7HOHFRP
% weight in Index
as of March 2012
NIM (%),
2011
1$
Avg. RoE (%),
2011
1$
6RXUFH%ORRPEHUJ7DGDZXO5HXWHUVVWDUWSHULRGVPD\GLIIHUEDVHGRQWKHDYDLODELOLW\RIGDWD
'HVSLWHLQWHQVHFRPSHWLWLRQ0RELO\UHSRUWHGUREXVWUHYHQXHJURZWKRI
GXULQJ7KLVFDQEHODUJHO\DVFULEHGWRWKHKLJKHUXVDJHPLQXWHVDQGGDWD
WUDQVPLVVLRQDQGLQFUHDVHGEURDGEDQGVXEVFULEHUV67&¶VUHYHQXHVJUHZ
WR65EQGXULQJGXHWRDQLQFUHDVHLQUHYHQXHVIURPLQWHUQDWLRQDO
111
7(/(&20
1&%&$3,7$/
0$<
RSHUDWLRQVDQGGDWDVHUYLFHV+RZHYHUQHWSURILWH[FOXGLQJFDSLWDOJDLQ
GHFOLQHGGXHWRLQFUHDVHGFRVWRIVHUYLFHVDQGRSHUDWLQJH[SHQVHV=DLQ
.6$¶VUHYHQXHVJUHZ<R<EXWLWLQFXUUHGORVVHVRI65EQGXULQJ
$WKHHESURYHGWREHDVLJQLILFDQWJDLQHULQWKHVHFWRULQWHUPVRIJURZWKZLWKD
IRXUIROGLQFUHDVHLQUHYHQXHVWR65PQ
Exhibit 84 Revenue of companies, 2009-2011
Exhibit 85: Net profit margin, 2009-2011
65PQ
$WKHHE
=DLQ
0RELO\
67&
67&
6RXUFH7DGDZXO
0RELO\
6RXUFH7DGDZXO
$VRI'HFHPEHUWKH3%PXOWLSOHVRI67&DQG0RELO\VWRRGDW[DQG
[UHVSHFWLYHO\ZKLOHWKDWRI=DLQVWRRGDW[52(RI67&DQG0RELO\VWRRG
DWDQGUHVSHFWLYHO\:LWK=DLQDQG$WKHHEFRQWLQXLQJWRUHSRUWORVVHV
WKHLU52(UHPDLQHGQHJDWLYH
Exhibit 86: Comparison of P/B and RoE, 2010
Exhibit 87: Comparison of P/B and RoE, 2011
3%9[
52(
52(
3%9[
67&
0RELO\
=DLQ.6$
6RXUFH%ORRPEHUJ7DGDZXO
6L]HRIWKHEXEEOHUHSUHVHQWVPDUNHWFDSDVRQ$SULO
$WKHHE
67&
0RELO\
=DLQ.6$
$WKHHE
6RXUFH%ORRPEHUJ7DGDZXO
6L]HRIWKHEXEEOHUHSUHVHQWVPDUNHWFDSDVRQ$SULO
=DLQZDVWKHPRVWDFWLYHVWRFNLQWKHWHOHFRPVHFWRUWXUQRYHURI65PQSHU
GD\LQIROORZHGE\0RELO\65PQSHUGD\
112
7(/(&20
1&%&$3,7$/
0$<
Exhibit 88: Avg. daily turnover, Jan11 ± Dec11
Exhibit 89: Share price movement, Jan11 ± Dec11
65PQ
5HEDVHGWRRQVW-DQ
-DQ
0RELO\
=DLQ
67&
6RXUFH%ORRPEHUJ7DGDZXO
0DU
0RELO\
0D\
$XJ
=DLQ.6$
2FW
'HF
67&
6RXUFH%ORRPEHUJ7DGDZXO
7KH6DXGL$UDELDQWHOHFRPPXQLFDWLRQVHFWRULVZLWQHVVLQJVWURQJSULFHEDVHG
FRPSHWLWLRQZLWKWKHIRFXVVKLIWLQJIURPYRLFHWRGDWD7KHGULYHWRFDSWXUHWKH
HYROYLQJGDWDVHJPHQWZKLFKLVODUJHO\XQGHUSHQHWUDWHGQRZLVOHDGLQJWR
VLJQLILFDQWSULFLQJSUHVVXUH1HYHUWKHOHVVZHEHOLHYHWKHORQJWHUPJURZWK
GULYHUVIRUWKHVHFWRUUHPDLQLQWDFWGXHWRWKHLQFUHDVHGDGRSWLRQRIYDOXHDGGHG
VHUYLFHVDPLGORZHUWDULIIKDQGVHWSULFHVDQGWKHHYROXWLRQRIVPDUWSKRQHV
VDOHVRIVPDUWKDQGKHOGGHYLFHVLQFUHDVHGLQDFFRUGLQJWR&,7&
$UHODWLYHO\\RXQJSRSXODWLRQDQGWKHLUZLOOLQJQHVVWRDGRSWQHZWHFKQRORJLHVDV
ZHOODVWKHULVLQJGLVSRVDEOHLQFRPHLQ.6$VKRXOGVXSSRUWWKHGHPDQGIRU
WKHVHVHUYLFHV:HEHOLHYHWKHH[LVWLQJSUHVVXUHRQPDUJLQVLVOLNHO\WR
UDWLRQDOL]HDIWHU&,7&¶VFRPPHQWRIDYRLGLQJSULFHZDUVJLYHQLWLVDGYHUVHWR
ORQJWHUPLQYHVWPHQWLQWKHVHFWRU
1&%&5HFRPPHQGDWLRQVLQWKH6HFWRU
:HKDYHDFDXWLRXVO\RSWLPLVWLFYLHZRQWKH6DXGL$UDELDQWHOHFRPVHFWRUDVD
ZKROH&RQFHUQVH[LVWRYHUGHFOLQLQJ$538VOLPLWHGURRPIRURSHUDWLQJ
HIILFLHQFLHVKLJKPRELOHSHQHWUDWLRQOHYHOVDQGDVDWXUDWLQJYRLFHPDUNHW
+RZHYHULQFUHDVLQJIRFXVRQWKHODUJHO\XQGHUSHQHWUDWHGGDWDVXEVHJPHQW
SULPDULO\YDOXHDGGHGVHUYLFHVDQGEURDGEDQGDFFHVVLQFUHDVLQJHTXLSPHQW
GHPDQGSRWHQWLDOLQWHUQDWLRQDOH[SRVXUHDQGVWURQJXQGHUO\LQJPDFURHFRQRPLF
IDFWRUVDUHOLNHO\WRVXSSOHPHQWWKHVHFWRU¶VJURZWKLQWKHQHDUWHUP:HDUH
FXUUHQWO\FRYHULQJWKUHHVWRFNVLQWKHVHFWRU6DXGL7HOHFRP&R0RELO\DQG=DLQ
.6$
Exhibit 90: Coverage stocks details
Stock
Current Rating
6DXGL7HOHFRP&R 2YHUZHLJKW
6(
0RELO\
6(
2YHUZHLJKW
=DLQ.6$
6(
1HXWUDO
PT (SR)
Comments
.H\SRVLWLYHVRIWKHVWRFNLQFOXGHLWVGRPLQDQFHLQ'6/DQGLWVKLJKHUDQGPRUH
VHFXUH$538OHYHOV.H\FRQFHUQVRQWKHVWRFNDUHIRFXVHGRQWKHOLPLWHG
LQIRUPDWLRQDYDLODEOHRQLWVLQWHUQDWLRQDORSHUDWLRQVDVZHOODV);H[SRVXUH
WKURXJKLWVLQWHUQDWLRQDOLQYHVWPHQWV
.H\SRVLWLYHVRIWKHVWRFNLQFOXGHLWVGRPLQDQFHLQZLUHOHVVLQWHUQHWDFFHVVDQG
LWVIRFXVHGVWUDWHJ\.H\FRQFHUQVRQWKHVWRFNDUHIRFXVHGRQLWVGHFOLQLQJ
$538OHYHOVDQGDFTXLVLWLRQFRVWVRIQHZFXVWRPHUV
.H\SRVLWLYHVRIWKHVWRFNLQFOXGHLWVDWWUDFWLYHDQGLQQRYDWLYHSDFNDJHVDQG
LQFUHDVLQJPDUNHWVKDUH.H\FRQFHUQVRQWKHVWRFNDUHIRFXVHGRQLWVKLJK
GHEWOHYHOVDQGWKHILQDQFLQJRIWKLVDVZHOODVRZQHUVKLSFRQFHUQV
6RXUFH1&%&5HVHDUFK
113
7(/(&20~0$<
(7,+$'(7,6$/$7
$/62.12:1$602%,/<
Etihad Etisalat Company (Mobily) is the second largest mobile
operator in Saudi Arabia. As of December 2011, the company
had a market share of around 40%. Stable ARPU, increased
equipment sales, gains in data, and a potential upside in the
size and frequency of dividends are key positives. The
possibility of continued price-led competition, particularly in
the international call segment, is a key threat.
x Business brief
0RELO\ZDVHVWDEOLVKHGLQZLWK8$(EDVHG(PLUDWHV
7HOHFRPPXQLFDWLRQV&RUSRUDWLRQ(WLVDODWDVWKHPDMRULW\RZQHU0RELO\
FRPPHQFHGRSHUDWLRQVLQE\SURYLGLQJZLUHOHVVWHOHFRPPXQLFDWLRQ
VHUYLFHV7KHFRPSDQ\RIIHUVPRELOHWHOHSKRQ\VHUYLFHVLQWKH.LQJGRP
XVLQJ*60*DQG:LPD[WHFKQRORJLHV0RELO\¶VEURDGEDQGVXEVFULEHUV
WRWDOHGPQLQ
x Financials
0RELO\¶VUHYHQXHVJUHZ<R<WR65PQLQ)<DWWULEXWDEOH
ODUJHO\WRLQFUHDVHGRIUHYHQXHIURPGDWDDJDLQVWLQDV
EURDGEDQGVXEVFULEHUVJUHZIURPPQLQWRPQLQ,QFUHDVH
LQSRVWSDLGVXEVFULEHUVDQGH[SDQVLRQRIEXVLQHVVVHFWRUUHYHQXHE\
DQGUHVSHFWLYHO\DOVRVXSSRUWHGWKHUHYHQXHJURZWK(%,7'$VXUJHG
<R<WR65PQLQ)<DVPDUJLQVGHFOLQHGGXHWRLQFUHDVHG
FRPSHWLWLRQLQWKHLQWHUQDWLRQDOFDOODQGGDWDEXVLQHVVDVZHOODVKLJKHU
FRQWULEXWLRQRIORZPDUJLQVPDUWSKRQHVDQGWDEOHW3&V¶GXULQJWKH\HDU'XH
WRWKLVQHWLQFRPHFDPHLQDW65PQXS<R<1HWPDUJLQ
GHFOLQHGE\ESV<R<WRLQDVFRPSDUHGWRLQ
x Recent Developments
,Q)HEUXDU\0RELO\VLJQHGDUHILQDQFLQJDJUHHPHQWZRUWK65EQZLWK
VHYHQORFDOEDQNVWRUHILQDQFHWKUHHRILWVH[LVWLQJVKRUWPHGLXPDQGORQJ
WHUPORDQV,Q0DUFKWKHFRPSDQ\DQQRXQFHGFROODERUDWLRQZLWK
(WLKDG$WKHHE7HOHFRP*2WRSURYLGHIL[HGYRLFHVHUYLFHV
OVERWEIGHT
Current price (SR)
65.8
3ULFLQJDVRI
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
((&$%
ZZZPRELO\FRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
11A
12A
13E
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
SHARE PRICE PERFORMANCE
2011
2012E
2013E
YoY CAGR (%)
(10-13E)
(%)
5HYHQXHV
65PQ
2010
(%,7'$
65PQ
1HW,QFRPH
65PQ
$VVHWV
65PQ
(TXLW\
65PQ
7RWDO'HEW
65PQ
&DVK(TXLY
65PQ
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
65
%936
65
0D\
6HS
7$6,
-DQ
0D\
(WLKDG(WLVDODW&R
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
(WLVDODW±8$(
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
114
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
7(/(&20~0$<
6$8',7(/(&20
$/62.12:1$667&
Despite liberalization of the sector, STC remains the leading
telecom company in Saudi Arabia by revenues and market
share. Bottom line progress in its international operations and
continued growth in the Saudi market are 67&¶V key positives;
price-led competition and FX exposure are key areas of
concern.
x Business brief
OVERWEIGHT
Current price (SR)
41.3
3ULFLQJDVRI
6DXGL7HOHFRP67&ZDVHVWDEOLVKHGLQDV6DXGL$UDELD¶VILUVWWHOHFRP STOCK DETAILS
RSHUDWRU 67&FODVVLILHVLWVRSHUDWLQJVHJPHQWVLQWHUPVRIVHUYLFHRIIHULQJV
ZHHNUDQJH+/65
*603671DQG'$7$7KH*60VHJPHQWLQFOXGHVPRELOH*SUHSDLG
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
FDUGVLQWHUQDWLRQDOURDPLQJDQGPHVVDJLQJVHUYLFHV3671FRPSULVHVIL[HG
OLQHFDUGWHOHSKRQHVLQWHUFRQQHFWDQGLQWHUQDWLRQDOFDOOVHUYLFHV'$7$
Price perform (%) 1M
VHUYLFHVFRQVLVWRIOHDVHGGDWDWUDQVPLVVLRQV'6/DQG,QWHUQHWVHUYLFHV
$EVROXWH
0RUHWKDQRIUHYHQXHVFDPHIURPDEURDGLQFOXGLQJ7XUNH\
0DUNHW
0DOD\VLDDQG,QGLD
6HFWRU
x Financials
3M
12M
Avg daily turnover (mn)
'HVSLWHLQFUHDVHGGRPHVWLFFRPSHWLWLRQWKHJURXS¶VUHYHQXHVJUHZLQ
GXHWRLPSURYHGFRQWULEXWLRQIURPLQWHUQDWLRQDOEXVLQHVVDQGD
<R<LQFUHDVHLQEURDGEDQGUHYHQXHV(%,7'$JUHZ<R<GXHWRD
GHFOLQHLQ6*$H[SHQVHVLQFRPSDUHGWRDQULVHLQ
(%,7'$PDUJLQLVH[SHFWHGWRUHPDLQFORVHWRLQVLQFHWKH
DGYHUVHLPSDFWRIORZHUPDUJLQKDQGVHWVDOHVKDVPRVWO\EHHQIHOWLQ
+RZHYHUD<R<LQFUHDVHLQILQDQFLDOFKDUJHVOHGWRDQGHFOLQHLQ
QHWLQFRPHLQ)<7KHFRPSDQ\LVH[SHFWHGWRFRQWLQXHWRLQYHVWLQ
XSJUDGLQJQHWZRUNVDQGLQFUHDVLQJLWVLQWHUQDWLRQDOSUHVHQFHZKLFKPLJKW
LQFUHDVHLWVGHEWOHYHOV
x Recent developments
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
3([
,Q'HFHPEHU67&HQWHUHGLQWRDQDJUHHPHQWZLWK6DXGL5HVHDUFKDQG
0DUNHWLQJ*URXSWRSXUFKDVH650*¶VVKDUHLQ,QWLJUDO67&DEDQGRQHG
DSODQWRELGIRU,UDT¶VIRXUWKPRELOHSKRQHOLFHQVHDIWHUGHOD\VLQDZDUGLQJ
WKHFRQWUDFW
67&$%
ZZZVWFFRPVD
11A
12A
13E
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2010
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2011
2012E
2013E
YoY CAGR (%)
0D\
6HS
-DQ
7$6,
0D\
67&5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
3XEOLF,QYHVWPHQW)XQG
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
3XEOLF3HQVLRQ$XWKRULW\33$
6RXUFH7DGDZXO1&%&5HVHDUFK
115
7(/(&20~0$<
=$,1.6$
$/62.12:1$6=$,1
Mobile Telecommunications Company Saudi Arabia (Zain
KSA)²a member of Mobile Telecommunications Group (Zain),
Kuwait²was established in 2007 in Saudi Arabia to provide
wireless telecommunications services. Good progress in
growing its subscriber base is a key positive of Zain;
continued management change and further delay in balance
sheet restructuring are key risks.
x
Current price (SR)
x Recent developments
3M
12M
Company financials
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
=$,1.6$$%
ZZZVD]DLQFRP
WEIGHTING & FREEFLOAT (%)
2Q0DUFKWKH%RDUGDSSRLQWHG0U)UDVHU&XUOH\DVWKHQHZ&(2RI
WKHFRPSDQ\2Q-DQXDU\WKHFRPSDQ\UHFHLYHGLQYHVWRUDSSURYDO
IRUD6$5EQV\QGLFDWHG0XUDEDKDILQDQFLQJWRH[WHQGWKHPXUDEDKD¶V
PDWXULW\WLOO-XO\
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
9.2
3ULFLQJDVRI
Avg daily turnover (mn)
'XHWRLWVLQFUHDVHGVXEVFULEHUEDVHDQGEURDGEDQGFXVWRPHUV=DLQ.6$
UHFRUGHGD<R<UHYHQXHJURZWKLQ&2*6GHFOLQHGLQ
)<FRPSDUHGWRLQ)<OHDGLQJWRDSRVLWLYH(%,7'$RI65PQ
FRPSDUHGWR65PQLQ7KHIDOOLQILQDQFLDOFKDUJHVLQ)<
YLVDYLVLQ)<OLPLWHGQHWORVVHVWR65PQ<R<
2010
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
NEUTRAL
Business brief
STOCK DETAILS
=DLQ.6$LVWKHWKLUGPRELOHRSHUDWRULQWKH.LQJGRPZKLFKRIIHUVERWKYRLFH ZHHNUDQJH+/65
0DUNHWFDSPQ
DQGGDWDVHUYLFHV7KHFRPSDQ\ODXQFKHGFRPPHUFLDOVHUYLFHVLQ$XJXVW
6KDUHVRXWVWDQGLQJPQ
DQGLVVDLGWRKDYHPQVXEVFULEHUVDVRI'HFHPEHU=DLQ.6$
EHFDPH(%,7'$SRVLWLYHLQ+RZHYHUWKHFRPSDQ\¶VDELOLW\WR
Price perform (%) 1M
JHQHUDWHQHWSURILWVLVKDPSHUHGE\DKLJKGHEWEXUGHQDQGFRQWLQXRXV
$EVROXWH
PDQDJHPHQWFKDQJHDVWKHFRPSDQ\DQQRXQFHGLWVQHZ&(2RQ0DUFK
0DUNHW
WKLUG&(2LQVL[PRQWKV
6HFWRU
x Financials
2011
2012E
2013E
YoY
(%)
CAGR (%)
(10-13E)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
11A
12A
3([
13E
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
SHARE PRICE PERFORMANCE
0D\
6HS
-DQ
7$6,
0D\
=DLQ5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
0RELOH7HOHFRPPXQLFDWLRQV&R
)DGHQ&RPPHUFLDO5HDO(VWDWH
(VWDEOLVKPHQW
)DFWRU\6WHDN6DXGL(/3/$
6RXUFH 7DGDZXO 1&%& 5HVHDUFK
116
7(/(&20~0$<
(7,+$'$7+((%
$/62.12:1$6$7+((%
Etihad Atheeb Telecommunications Company (Atheeb) was
established in 2008 to provide fixed-line telecommunication
services in KSA. The company is a joint venture between
Bahrain Telecom and KSA-based Atheeb Trading Co, Al-Nahla
Trading Co, and Traco Group.
NOT COVERED
Current price (SR)
18.0
3ULFLQJDVRI
x Business brief
$WKHHEZDVHVWDEOLVKHGWREXLOGRSHUDWHDQGPDLQWDLQWKHVHFRQGIL[HGOLQH
WHOHFRPPXQLFDWLRQQHWZRUNLQ6DXGL$UDELD7KHFRPSDQ\RIIHUVYLGHR
STOCK DETAILS
VHUYLFHVLQWHUQHWWHOHSKRQ\DQGEURDGEDQGLQWHUQHWDVZHOODVYRLFH
ZHHNUDQJH+/65
WHOHSKRQHFRPPXQLFDWLRQVDQGGDWDVHUYLFHV7KHFRPSDQ\RIIHUVYRLFHDQG
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
LQWHUQHWVHUYLFHVDFURVVFLWLHVLQ.6$XQGHUWKH³*2´EUDQG
x Financials
Price perform (%)
$WKHHE¶VUHYHQXHVLQFUHDVHG<R<WR65PQLQ0FRPSDUHGWR
65PQLQ0)XUWKHUPRUHDGHFOLQHLQ&2*6UHVWULFWHG
(%,7'$ORVVHVWR65PQ65PQORVVLQ02WKHULQFRPH
LQFUHDVHGWR65PQOHDGLQJWRDQHWSURILWRI65PQLQ0DJDLQVWD
QHWORVVRI65PQLQ07KHFRPSDQ\H[SDQGHGLWVSURSRVHG
65PQULJKWVLVVXHWR65EQWRPHHWDGGLWLRQDOIXQGLQJQHHGV
x Recent developments
2Q0DUFK$WKHHEDQQRXQFHGFROODERUDWLRQZLWK(WLKDG(WLVDODW
&RPSDQ\0RELO\WRSURYLGHIL[HGYRLFHVHUYLFHVWRVHYHUDOFRPPHUFLDODQG
UHVLGHQWLDOFRPSOH[HVZKLFKZRXOGEHDJUHHGXSRQLQGXHFRXUVH,Q0DUFK
$WKHHE7HOHFRP*2DQQRXQFHGFROODERUDWLRQZLWK6DXGL7HOHFRP
&RPSDQ\67&RQRIIHULQJFRPPHUFLDOVHUYLFHV
1M
3M
12M
$EVROXWH
1$
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
1$
1$
0
1$
1$
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
($7$%
ZZZJRFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
Company financials*
10A
11A
3([
3%[
36[
'LY<LHOG
'36
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
FY09
FY10**
FY11
9M12*
YoY
(%)
CAGR (%)
(09-12E)
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFKFRPSDQ\¶V\HDUHQGLQJLV0DUFK$WKHHEVWDUWHGRSHUDWLRQVLQ-DQXDU\
TTM
6RXUFH1&%&5HVHDUFKHVWLPDWHV
SHARE PRICE PERFORMANCE
0D\ 0D\ $SU $SU 0D\
7$6,
$WKHHE5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
$WKHHE7UDGLQJ&R/WG
%DKUDLQ7HOHFRP
$O1DKOD&RPPHUFLDO5HDO(VWDWH 75$&2
6RXUFH7DGDZXO1&%&5HVHDUFK
117
7(/(&20~0$<
6$8',,17(*5$7('
$/62.12:1$6$/087$.$6$
Saudi Company for Integrated Telecommunications Company
(SITC) was formed as a partnership between Integrated
Telecom (ITC) and PCCW (one of the biggest
telecommunication providers in Hong Kong). In June 2011,
SITC launched its IPO to offer 35mn shares, representing 35%
of its share capital and was listed on the Tadawul Stock
Exchange on June 28, 2011.
x Business brief
6,7&ZDVHVWDEOLVKHGWRRIIHUQH[WJHQHUDWLRQVROXWLRQVIRUEURDGEDQG
LQWHUFRQQHFWLRQDQGVDWHOOLWHVHUYLFHVLQ6DXGL$UDELD $FFRUGLQJWRWKHWHUPV
RIWKHDJUHHPHQW3:&&ZRXOGPDQDJHWKHEXVLQHVVIRUILYH\HDUVRQD
EXLOGRSHUDWHDQGWUDQVIHUEDVLV,7&WKHIRXQGHUFRPSDQ\LVRQHRIWKH
OHDGLQJWHOHFRPPXQLFDWLRQILUPVLQWKH.LQJGRPZLWKVL[LQWHUQDWLRQDO
JDWHZD\V2QHRIWKHNH\EHQHILWVWKDW,7&HQMR\VLVJDLQVIURPVLJQLILFDQW
LQYHVWPHQWVLQLQGHSHQGHQWDQGVWDWHRIWKHDUWILEHUQHWZRUNRI.0
FRQQHFWLQJNH\FLWLHVLQWKH.LQJGRPDQGDQRWKHU.0LQPHWURDUHDV
x Financials
6,7&KDVQRWFRPSOHWHGRQHIXOO\HDURIRSHUDWLRQVKHQFHILQDQFLDOVKDYH
QRWEHHQGLVFXVVHG
NOT COVERED
Current price (SR) 27.20
3ULFLQJDVRI
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
1$
1$
1$
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
7KH%RDUGRIWKH&DSLWDO0DUNHWV$XWKRULW\&0$DQQRXQFHGVXVSHQVLRQRI
WUDGLQJLQ6,7&¶VVKDUHVIURP$SULODVWKHFRPSDQ\GLGQRWGLVFORVH
LWVILQDQFLDOUHVXOWVE\WKHVWLSXODWHGGHDGOLQHVHWE\WKH&0$
5HXWHUVFRGH
$/087$.$$%
ZZZLWFQHWVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
6(
%ORRPEHUJFRGH
x Recent developments
VALUATION MULTIPLES
08A
09A
10A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
2008
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
SHARE PRICE PERFORMANCE
-XQ
6HS
7$6,
'HF
0DU
$OPXWDND5+6
TOP 5 SHAREHOLDERS (%)
$O0DZDULG,QYHVWPHQW&R/WG
3&&:&DVFDGH0LGGOH(DVW
,QWHJUDWHG7HOHFRPPXQLFDWLRQV/WG
$O0DZDULG(OHFWURQLF&R/WG
3XEOLF3HQVLRQ$JHQF\
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK7UDGLQJVXVSHQGHGVLQFH
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
118
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Insurance
Ticker
Company
Page No.
8010
Tawuniya
122
8030
MEDGULF
123
8020
Malath Insurance
124
8310
AMANA Insurance
125
8200
Saudi Re
126
8290
Solidarity
127
8210
BUPA Arabia
128
8260
Gulf General
129
8250
AXA-Cooperative
130
8230
ARCCI
131
8170
Trade Union
132
8190
UCA
133
8080
SABB Takaful
134
8130
Alahli Takaful
135
8180
Sagr Insurance
136
8280
Al Alamiya
137
8220
Weqaya Takaful
138
8160
Arabia Insurance
139
8060
Walaa Insurance
140
8120
Gulf Union
141
8070
Arabian Shield
142
8270
Buruj Insurance
143
8090
SANAD
144
8300
Wataniya Insurance
145
8240
ACE Arabia
146
8040
ALLIANZ SF
147
8050
Saudi Salama
148
8140
Al-Ahlia Insurance
149
8150
ACIG
150
8100
SAICO
151
8110
Saudi Indian
152
8311
Saudi Enaya
153
0$<
,1685$1&(
+HDOWKLQVXUDQFHGULYHVLQVXUDQFHPDUNHW
6DXGL$UDELDLVRQHRIWKHODUJHVWLQVXUDQFHPDUNHWVLQWKH*&&
+RZHYHULQVXUDQFHSHQHWUDWLRQLQWKH.LQJGRPLVDPRQJWKH
ORZHVWLQWKHUHJLRQ,Q.6$QRQOLIHSROLFLHVJHQHUDWHPRVWRIWKH
SUHPLXPLQFRPHFRPSDUHGWROLIHSROLFLHV$FFRUGLQJ
WRWKH(FRQRPLVW,QWHOOLJHQFH8QLW(,8KHDOWKLQVXUDQFHLVWKH
ELJJHVWOLQHRIEXVLQHVVRIWKHLQVXUDQFHPDUNHWLQ
IROORZHGE\JHQHUDOLQVXUDQFHZKLFKLQFOXGHVSURSHUW\DQG
DXWRPRELOHLQVXUDQFH)DYRUDEOHGHPRJUDSKLFSURILOHUHJXODWRU\
VXSSRUWDQGZLGHUDFFHSWDQFHIRU7DNDIXOLQVXUDQFHDUHOLNHO\WR
GULYHJURZWKLQWKHLQGXVWU\
7KHLQVXUDQFHVHFWRULQ6DXGL$UDELDFRQWLQXHGWRH[SDQGLQ²VHFWRU
UHYHQXHURVH<R<WR86'EQIURP86'EQLQ7KHVHFWRU
FRQWLQXHVWRRIIHUVLJQLILFDQWJURZWKRSSRUWXQLWLHVJLYHQWKDWLQVXUDQFH
SHQHWUDWLRQLQWKH.LQJGRPLVORZZLWKWKHUDWLRRIWRWDOHVWLPDWHGSUHPLXPVWR
*'3SHJJHGDWLQDFFRUGLQJWR6ZLVV5H+LJKSRSXODWLRQJURZWK
ZLWKULVLQJSURSRUWLRQRI\RXQJSHRSOHDQGVXSSRUWLYHJRYHUQPHQWUHJXODWLRQV
PDQGDWRU\KHDOWKLQVXUDQFHIRUH[SDWVDQGPRVWQDWLRQDOVUHLQIRUFHWKHRXWORRN
IRUJURZWKLQWKHLQGXVWU\+RZHYHUZLWKDURXQGLQVXUDQFHSOD\HUVLQWKH
.LQJGRPWKHLQGXVWU\IDFHVLQWHQVHFRPSHWLWLRQ
/LVWHGLQVXUDQFHFRPSDQLHVLQ.6$DUHWUDGLQJDWDKLJKHU3%PXOWLSOHRI[
FRPSDUHGWRWKH*&&DYHUDJHRI[+RZHYHUWKHDYHUDJH52(IRUSOD\HUVLQ
WKH.LQJGRPLVDVORZDVFRPSDUHGWRWKH*&&DYHUDJHRI7KLVLV
EHFDXVHPDMRULW\RIWKHFRPSDQLHVFRQWLQXHWRPDNHORVVHVRIWKHWRWDO
OLVWHGFRPSDQLHVLQWKHVHFWRULQFXUUHGORVVHVLQZKLFKLQGLFDWHVWKDWWKH
VHFWRULVVWLOOLQWKHQDVFHQWVWDJHRIGHYHORSPHQW
Exhibit 91: Revenue of GCC insurance companies,
2009±11
Exhibit 92: Comparison of ROE and P/E of GCC
companies, 2011
86'PQ
.6$
8$(
4DWDU
.XZDLW
6RXUFH=DZ\D%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
%DK UDLQ
2PDQ
.6$
8$(
4DWDU
.XZDLW
%DK UDLQ
2PDQ
6RXUFH=DZ\D%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
$VRI0DUFKPDUNHWFDSLWDOL]DWLRQRIWKHFRPSDQLHVLQ.6$¶V
LQVXUDQFHVHFWRUVWRRGDW86'EQ7KHHUVWZKLOHVWDWHRZQHGPRQRSRO\
7DZXQL\DLVWKHODUJHVWFRPSDQ\LQ6DXGL$UDELDDFFRXQWLQJIRURIWKH
WRWDOPDUNHWFDSLWDOL]DWLRQIROORZHGE\0HGLWHUUDQHDQ*XOI,QVXUDQFH
5HLQVXUDQFH&R0('*8/)*LYHQWKDWLQVXUDQFHLVDFDSLWDOLQWHQVLYH
EXVLQHVVZLWKDKLJKJHVWDWLRQSHULRGDQGWKDW.6$¶VLQVXUDQFHVHFWRULVVWLOOLQ
120
,1685$1&(
1&%&$3,7$/
0$<
LWVHDUO\VWDJHVVHYHUDOOLVWHGFRPSDQLHVDUHH[SHULHQFLQJORZOHYHOVRI
SURILWDELOLW\RUORVVHV
Exhibit 93: Sector details
8QLWVDVVWDWHG
% weight in Index
as on 28 Mar 2012
Country
6DXGL)UDQVL&RRSHUDWLYH,QVXUDQFH&R$OOLDQ]6)
7KH&RPSDQ\IRU&RRSHUDWLYH,QVXUDQFH7DZXQL\D
7KH0HGLWHUUDQHDQ*XOI,QVXUDQFHDQG5HLQVXUDQFH&R0('*8/)
0DODWK&RRSHUDWLYH,QVXUDQFHDQG5HLQVXUDQFH&R0DODWK
6ROLGDULW\6DXGL7DNDIXO&R6ROLGDULW\
6DXGL(QD\D&RRSHUDWLYH,QVXUDQFH&RPSDQ\
6$%%7DNDIXO6$%%
$PDQD&RRSHUDWLYH,QVXUDQFH&R$PDQD
%XSD$UDELDIRU&RRSHUDWLYH,QVXUDQFH&R%XSD
6DXGL8QLWHG&RRSHUDWLYH,QVXUDQFH&R:DODD
*XOI8QLRQ&RRSHUDWLYH,QVXUDQFH&R*XOI8QLRQ
8QLWHG&RRSHUDWLYH$VVXUDQFH8&$
:HTD\D7DNDIXOLQVXUDQFHUHLQVXUDQFH&R:HTD\D
$O5DMKL&RPSDQ\IRU&RRSHUDWLYH,QVXUDQFH$5&&,
*XOI*HQHUDO&RRSHUDWLYH,QVXUDQFH&RPSDQ\*XOI*HQHUDO
$UDELDQ6KLHOG&RRSHUDWLYH,QVXUDQFH&R$UDELDQ6KLHOG
7KH6DXGL$UDELDQ&RRSHUDWLYH,QVXUDQFH&R6$,&2
$ODKOL7DNDIXO&RPSDQ\$7&
$O$KOLD,QVXUDQFH&R$O$KOLD
$UDELD,QVXUDQFH&RRSHUDWLYH&R$,&&
7UDGH8QLRQ&RRSHUDWLYH,QVXUDQFH7UDGH8QLRQ
$O6DJU&RRSHUDWLYH,QVXUDQFH&R$O6DJU
$&($UDELD&RRSHUDWLYH,QVXUDQFH&R$&(
$;$&RRSHUDWLYH,QVXUDQFH&R$;$&RRSHUDWLYH
$O$ODPL\DIRU&RRSHUDWLYH,QVXUDQFH&RPSDQ\$O$ODPL\D
%XUXM&RRSHUDWLYH,QVXUDQFH&RPSDQ\%XUXM
:DWDQL\D,QVXUDQFH&RPSDQ\:DWDQL\D
,VODPLF$UDE,QVXUDQFH&R6$/$0$
6DQDG,QVXUDQFHDQG5HLQVXUDQFH&RRSHUDWLYH&R6DQDG
6DXGL,QGLDQ&RPSDQ\IRU&RRSHUDWLYH,QVXUDQFH6DXGL,QGLDQ
$OOLHG&RRSHUDWLYHLQVXUDQFHJURXS$&,*
6DXGL5HIRU&RRSHUDWLYH5HLQVXUDQFH&R6DXGL5H
NIM (%),
2011
10
10
10
Avg. RoE (%),
2011
10
10
6RXUFH=DZ\D%ORRPEHUJ7DGDZXO&RPSDQ\GDWD
7KHVHFWRU¶VSURILWIHOOWR86'PQLQIURP86'PQLQ
DVQHZFRPSDQLHVLQFXUUHGKLJKHUORVVHV7DZXQL\D¶VUHYHQXHJUHZWR
65EQZKLOHQHWLQFRPHIHOODERXW0('*8/)¶VUHYHQXHURVH
<R<WR65EQZKLOH%83$¶VUHYHQXHLQFUHDVHG<R<WR65EQLQ
Exhibit 94: Revenue of companies, 2009±2011
Exhibit 95: Profitability of companies, 2009±2011
65PQ
7DZXQL\D
0HGJX OI
%XS D$ UDELD
2WKHUV
6RXUFH=DZ\D%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
7DZXQL\D
0HGJX OI
%XS D$ UDELD
6RXUFH=DZ\D%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
121
,1685$1&(~0$<
7$:81,<$
$/62.12:1$67$:81,<$
7KH&RPSDQ\IRU&RRSHUDWLYH,QVXUDQFH1&&,ZLGHO\NQRZQ
DV7DZXQL\DZDVHVWDEOLVKHGLQ5L\DGKLQ7DZXQL\D
SURYLGHV,VODPLFDVZHOODVFRQYHQWLRQDOJHQHUDODQGIDPLO\
LQVXUDQFHVHUYLFHV,WDOVRXQGHUWDNHVUHLQVXUDQFHDQG
DJHQF\DFWLYLWLHV7KHFRPSDQ\¶VVXEVLGLDULHVLQFOXGH8QLWHG
,QVXUDQFH&RPSDQ\VWDNH:DVHHO&RDQG
&RRSHUDWLYH5HDO(VWDWH,QYHVWPHQW&R
x %XVLQHVVEULHI
7DZXQL\D¶VSURGXFWSRUWIROLRIDOOVXQGHUWZREURDGFDWHJRULHVUHWDLODQG
FRUSRUDWH7KHUHWDLOVHJPHQWSURYLGHVPRWRUYHKLFOHPHGLFDODFFLGHQWILUH
SURSHUW\DQGPLVFHOODQHRXVLQVXUDQFH7KHFRUSRUDWHGLYLVLRQRIIHUVPRWRU
YHKLFOHPHGLFDOILUHSURSHUW\FDVXDOW\HQJLQHHULQJPDULQHDYLDWLRQDQG
HQHUJ\LQVXUDQFHVHUYLFHV7RDLGLWVLQVXUDQFHVHUYLFHVWKHFRPSDQ\
HQWHUHGLQWRDJUHHPHQWVZLWKLQWHUQDWLRQDOUHLQVXUHUVVXFKDV0XQLFK5H
x )LQDQFLDOV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDS65PQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
7DZXQL\D¶VJURVVZULWWHQSUHPLXPLQFUHDVHG<R<WR65EQIRUWKH
\HDUHQGHG'HFHPEHU7KHFRPSDQ\¶VQHWSUHPLXPHDUQHGURVH
<R<WR65EQ$VDUHVXOWWRWDOUHYHQXHJUHZ<R<WR
65EQ+RZHYHUQHWLQFRPHGHFOLQHG<R<DVQHWFODLPVLQFUHDVHG
<R<3URILWPDUJLQVDOVRIHOOGXHWRDGHFOLQHLQSULFHVDQG
SROLF\KROGHUV¶LQYHVWPHQWLQFRPH
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
7$:81,<$$%
ZZZWDZXQL\DFRPVD
x 5HFHQWGHYHORSPHQWV
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
,Q0DUFK7DZXQL\DDQQRXQFHGWKHGLVWULEXWLRQRI65SHUVKDUH
FDVKGLYLGHQGIRUWKH\HDUHQGHG'HFHPEHU
7
)UHHIORDW
)
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
<R< &$*5
7RWDO5HYHQXHV
65PQ
65PQ
1HW,QFRPH
65PQ
65PQ
$VVHWV
(TXLW\
65PQ
65PQ
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV 65PQ
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
65
%936
65
1HW,QV3UHPLXP
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
7DZXQL\D5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
3XEOLF3HQVLRQ$XWKRULW\
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
122
,1685$1&(~0$<
0('*8/)
$/62.12:1$60('*8/)6$8',
0HGLWHUUDQHDQ*XOI,QVXUDQFH5HLQVXUDQFH&R
0('*8/)DVXEVLGLDU\RI0HGJXOI*URXSLVDOHDGLQJ
LQVXUDQFHDQGUHLQVXUDQFHFRPSDQ\LQWKH0LGGOH(DVWZLWK
RSHUDWLRQVDFURVV6DXGL$UDELD%DKUDLQ/HEDQRQ7XUNH\
-RUGDQWKH8$(DQGWKH8.(VWDEOLVKHGLQWKH
FRPSDQ\FXUUHQWO\RSHUDWHVWKURXJKRIILFHVLQ5L\DGK
-HGGDKDQG.KREDU
x %XVLQHVVEULHI
0('*8/)SURYLGHVLQVXUDQFHSURGXFWVLQFOXGLQJPRWRUKHDOWKDYLDWLRQ
EDQNHU¶VEODQNHWERQGVEXUJODU\FRQWUDFWRU¶VDOOULVNFUHGLWHPSOR\HU¶V
OLDELOLW\ILGHOLW\JXDUDQWHHPDULQHFDUJRDQGKXOOLQVXUDQFH7KHFRPSDQ\
RIIHUVRQHVWRSVROXWLRQE\SURYLGLQJLQVXUDQFHDQGUHLQVXUDQFHVHUYLFHV
DORQJZLWKULVNPDQDJHPHQWDQGWKLUGSDUW\DGPLQLVWUDWLRQ
x )LQDQFLDOV
1HWLQVXUDQFHSUHPLXPZKLFKFRQWULEXWHVDURXQGWR0('*8/)¶VWRWDO
UHYHQXHJUHZ<R<WR65EQLQ&RQVHTXHQWO\WRWDOUHYHQXH
URVH<R<WR65EQ'HVSLWHDQLQFUHDVHLQFRPELQHGUDWLRWRLQ
IURPLQWKHFRPSDQ\¶VQHWLQFRPHJUHZ<R<WR
65PQ7KHULVHLQQHWLQFRPHFDQEHDWWULEXWHGWRLQFUHDVHGLQVXUDQFH
RSHUDWLRQVXUSOXV
x 5HFHQWGHYHORSPHQWV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
0('*8/)$%
ZZZPHGJXOIFRP
,Q0DUFK0('*8/)DSSURYHGWKHGLVWULEXWLRQRIFDVKGLYLGHQGRI65
SHUVKDUHIRUWKH\HDUHQGHG'HFHPEHU,Q$XJXVWWKH
FRPSDQ\DSSRLQWHG.KDOHG$EGXOODK6KDWKU\DQG(PDG-DODO%DEDQDV
LQGHSHQGHQWERDUGRIGLUHFWRUV,Q0D\0('*8/)HQWHUHGLQWRD
WKUHH\HDUFRQWUDFWZLWK6$%,&WRSURYLGHKHDOWKLQVXUDQFHWRWKHODWWHU¶V
HPSOR\HHVDQGIDPLO\PHPEHUVDVSHUFRQWUDFWWHUPVDQGFRQGLWLRQV'XULQJ
WKHVDPHPRQWKWKHFRPSDQ\REWDLQHGDQ$FUHGLWUDWLQJIURP6WDQGDUGV
3RRU¶V
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
)LQDQFLDOVRIIRU0RQWKV
<R<
&$*5
10
10
10
0D\
6HS
7$6,
-DQ
0D\
0('*8/)5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
0('*8/)
6DXGL,QYHVWPHQW%DQN
6RXUFH7DGDZXO1&%&5HVHDUFK
123
,1685$1&(~0$<
0$/$7+&223(5$7,9(
$/62.12:1$60$/$7+
0DODWK&RRSHUDWLYH,QVXUDQFHDQG5HLQVXUDQFH&RPSDQ\
0DODWKZDVHVWDEOLVKHGLQ+HDGTXDUWHUHGLQ5L\DGK
0DODWKZDVWKHVHFRQGLQVXUDQFHFRPSDQ\DIWHU7DZXQL\D
WREHOLVWHGRQWKH6DXGL6WRFN([FKDQJH,QDGGLWLRQWR
JHQHUDOLQVXUDQFHWKHFRPSDQ\DOVRSURYLGHVIDFXOWDWLYH
UHLQVXUDQFHSURGXFWV
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
0DODWK¶V&RUSRUDWH3URGXFWVVHJPHQWRIIHUVKHDOWKJURXSOLIHPRWRU
SURSHUW\HQJLQHHULQJPDULQHDYLDWLRQDQGHQHUJ\LQVXUDQFH8QGHUWKH
5HWDLOGLYLVLRQWKHFRPSDQ\SURYLGHVKHDOWKPHGLFDOPDOSUDFWLFHWUDYHODQG
PRWRULQVXUDQFH0DODWKGHULYHVSUHPLXPLQFRPHPDLQO\IURPPRWRU
PHGLFDOSURSHUW\DYLDWLRQPDULQHFDUJRKXOOHQHUJ\DQGHQJLQHHULQJ
LQVXUDQFH
x )LQDQFLDOV
0DODWK¶VWRWDOUHYHQXHLQFUHDVHG<R<WR65PQLQ7KH
JURZWKFDQEHPDLQO\DWWULEXWHGWRDULVHLQQHWLQVXUDQFHSUHPLXPHDUQHG
ZKLFKJUHZ<R<WR65PQIURP65PQLQ+RZHYHUWKH
FRPSDQ\¶VQHWLQFRPHGHFOLQHG<R<WR65PQLQFRPSDUHGWR
65PQLQ7KHIDOOZDVPDLQO\GXHWRFUHGLWVDOHVDQGDFKDQJHLQWKH
EDGGHEWSURYLVLRQFDOFXODWLRQPHWKRGEDVHGRQ6DXGL$UDELDQ0RQHWDU\
$JHQF\¶VUHTXLUHPHQWVZKLFKLQFUHDVHGEDGGHEWSURYLVLRQE\65PQLQ
0RWRUFODLPVSURYLVLRQDOVRURVHDVDUHVXOWRIWKHQHZUR\DOGHFUHHRQ
EORRGPRQH\
x 5HFHQWGHYHORSPHQWV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
0$/$7+$%
ZZZPDODWKFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
,Q1RYHPEHU0DODWKHQWHUHGLQWRDRQH\HDUDJUHHPHQWZLWK$YLYD
%ULWLVK&RWRSURYLGHKHDOWKLQVXUDQFHVHUYLFHVWRVWXGHQWVRQ8.
VFKRODUVKLS7KLVFRQWUDFWLVZRUWKPRUHWKDQRIWKHFRPSDQ\¶VDQQXDO
VDOHVLQ,Q0D\6WDQGDUGV3RRU¶VUHYLVHGWKHFRPSDQ\¶V
RXWORRNWRSRVLWLYHIURPVWDEOHDQGDIILUPHGLWVFUHGLWUDWLQJDWµ%%%¶
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
)LQDQFLDOVRIIRU0RQWKV
<R<
&$*5
10
10
0D\
6HS
7$6,
-DQ
0D\
0DODWK,QVXUDQFH5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
6RXUFH7DGDZXO1&%&5HVHDUFK
124
,1685$1&(~0$<
$0$1$&223(5$7,9(
$/62.12:1$6$0$1$
$PDQD&RRSHUDWLYH,QVXUDQFH&RPSDQ\$PDQDOLVWHGRQ
-XQHRQWKH7$6,SURYLGHVYDULRXVLQVXUDQFHSURGXFWV
WRFRPSDQLHVDQGLQGLYLGXDOV+HDGTXDUWHUHGLQ5L\DGKWKH
FRPSDQ\KDVEUDQFKHVLQ-HGGDKDQG.KREDU
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
$PDQDZDVHVWDEOLVKHGE\WKUHHFRPSDQLHV(O6HLI&R)$/+ROGLQJDQG
/LEDQR6XLVVH*URXSWKHVHILUPVWRJHWKHURZQRILWVVKDUHV7KH
FRPSDQ\SURYLGHVLQVXUDQFHVHUYLFHVWKURXJKWZREURDGVHJPHQWV
LQGLYLGXDODQGFRUSRUDWH8QGHUWKHLQGLYLGXDOSURGXFWVVHJPHQW$PDQD
RIIHUVPHGLFDODFFLGHQWSHUVRQDODFFLGHQWPRWRUWUDYHODQGRWKHUVILUH
DQGPDULQHLQVXUDQFHSURGXFWV8QGHUWKHFRUSRUDWHGLYLVLRQWKHFRPSDQ\
SURYLGHVKHDOWKILUHFDUHQJLQHHULQJSURSHUW\PDULQHDQGODQGVKLSPHQWV
DQGRWKHUPLVFHOODQHRXVLQVXUDQFHSURGXFWV
x )LQDQFLDOV
$PDQDUHSRUWHGQHWORVVRI65PQORZHUWKDQWKHSUHYLRXV\HDU¶V
ORVVRI65PQ7KHFRPSDQ\¶VQHWLQVXUDQFHSUHPLXPJUHZWUHPHQGRXVO\
IURPMXVW65PQLQWR65PQLQ+RZHYHUKLJKHURSHUDWLQJ
H[SHQVHVGXHWRHDUO\VWDUWXSVWDJHRIEXVLQHVVUHVXOWHGLQQHWORVVIRU
1RQHWKHOHVV$PDQDZDVDEOHWRUHGXFHLWVFRPELQHGUDWLRWR
LQIURPLQ
x 5HFHQW'HYHORSPHQWV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$0$1$$%
ZZZDPDQDFRRSFRPVD
,Q-DQXDU\$PDQDUHFHLYHGDSSURYDOIURP6DXGL$UDELDQ0RQHWDU\
$JHQF\6$0$WRRIIHUWUDYHOLQVXUDQFHSURGXFWVIRUDSHULRGRIVL[PRQWKV
,Q1RYHPEHUWKHFRPSDQ\DQQRXQFHGWKDW6$0$H[WHQGHGSURYLVLRQDO
DSSURYDORILQVXUDQFHSURGXFWVIRUDSHULRGRIVL[PRQWKV,Q2FWREHU
$PDQDDSSRLQWHG6DOHK%LQ1DVVHU$O2PDLUDV0DQDJLQJ'LUHFWRU
DQGPHPEHURI%2'UHSODFLQJ/XFLHQ-RVHSK
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
1$
1$
<R<
&$*5
0D\
6HS
-DQ
7$6,
0D\
$PDQD5+6
7236+$5(+2/'(56
$PDQD*XOI,QVXUDQFH&R
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
125
,1685$1&(~0$<
6$8',5(,1685$1&(
$/62.12:1$66$8',5(
(VWDEOLVKHGLQ0D\6DXGL5HLQVXUDQFH&R6DXGL5HLV
WKHILUVWFRRSHUDWLYHUHLQVXUDQFHFRPSDQ\LQ6DXGL$UDELD
+HDGTXDUWHUHGLQ5L\DGKWKHFRPSDQ\SURYLGHVOLIHDQGQRQ
OLIH6KDULD¶DFRPSOLDQWUHLQVXUDQFHSURGXFWV,WVSURGXFWV
FRYHUWUHDW\DQGIDFXOWDWLYHW\SHVRIUHLQVXUDQFHLQDOOFODVVHV
RIEXVLQHVVLQWKH.LQJGRPDVZHOODVRWKHUFRXQWULHVDFURVV
WKH0(1$UHJLRQ
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
6DXGL5HRIIHUVUHLQVXUDQFHUHODWHGSURGXFWVVXFKDVILUHPDULQHKXOODQG
FDUJRJHQHUDODFFLGHQWHQJLQHHULQJPDFKLQHU\EUHDNGRZQDQG
FRQWUDFWRU¶VULVNVDYLDWLRQPRWRUWKLUGSDUW\OLDELOLW\DVZHOODVOLIHDQG
PHGLFDOLQVXUDQFHV
x )LQDQFLDOV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDS65PQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
6DXGL5H¶VJURVVSUHPLXPVZULWWHQJUHZ<R<WR65PQLQ
IURP65PQLQ7KHFRPSDQ\¶VQHWLQVXUDQFHSUHPLXPURVH
<R<WR65PQ$VDUHVXOWLWVUHYHQXHLQFUHDVHGWR65PQLQ
+RZHYHU6DXGL5HSRVWHGDORVVRI65PQLQGXHWRD
VLJQLILFDQWLQFUHDVHLQQHWFODLPVDVZHOODVKLJKHUJHQHUDODQG
DGPLQLVWUDWLYHH[SHQVHV
x 5HFHQWGHYHORSPHQWV
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
,Q0D\6DXGL5HDSSRLQWHGLWV6KDULD¶D%RDUGWRIXOILOOFOLHQWV¶
UHTXLUHPHQWVDQGSURYLGH6KDULD¶DFRPSOLDQWUHLQVXUDQFHVROXWLRQVLQWKH
7DNDIXOLQGXVWU\0HPEHUVRIWKHERDUGLQFOXGH6KHLNK'U$EGXOVDWWDU$EX
*KXGGDK6KHLNK'U0RKDPHG$OL(OJDULDQG6KHLNK<RXVHI$O)DUUDM
,Q$SULOWKHFRPSDQ\DQQRXQFHGWKDW6WDQGDUGDQG3RRU¶V5DWLQJV
6HUYLFHKDGUDWHGLWVILQDQFLDOVWUHQJWKDV%%%
6$8',5($%
ZZZVDXGLUHFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP 65PQ
7RWDO5HYHQXHV
65PQ
1HW,QFRPH
65PQ
$VVHWV
65PQ
(TXLW\
65PQ
,QYHVWPHQWV
65PQ
7HFKQLFDO5HVHUYHV 65PQ
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
65
%936
65
10
10
1$
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
1$
1$
1$
<R< &$*5
10
10
10
10
10
10
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
6DXGL5H5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
-RUGDQLDQ,VODPLF)LQDQFH%DQN
$KPDG+DPDG$O*RVDLEL%URV&R 6RXUFH7DGDZXO1&%&5HVHDUFK
126
,1685$1&(~0$<
62/,'$5,7<6$8',
$/62.12:1$6667&62/,'$5,7<
6ROLGDULW\6DXGL7DNDIXO&RPSDQ\6ROLGDULW\ZDVOLVWHGRQ
WKH6DXGL6WRFN([FKDQJH7DGDZXOLQ-XQH
+HDGTXDUWHUHGLQ5L\DGKWKHFRPSDQ\SURYLGHVLQVXUDQFH
VHUYLFHVLQVHJPHQWVVXFKDVSURSHUW\PHGLFDOPDULQH
FDUJRDQGKXOOJHQHUDODFFLGHQWDQGPRWRU
127&29(5('
&XUUHQWSULFH65
3ULFLQJDVRI
x %XVLQHVVEULHI
6ROLGDULW\ZKLFKKDVDSDLGXSFDSLWDOEDVHRI65PQRIIHUVLQVXUDQFH
SURGXFWVLQFOXGLQJSURSHUW\LQVXUDQFHPHGLFDOLQVXUDQFHPDULQHFDUJRDQG 672&.'(7$,/6
KXOOLQVXUDQFHJHQHUDODFFLGHQWLQVXUDQFHHQJLQHHULQJLQVXUDQFHDQGPRWRU ZHHNUDQJH+/6
LQVXUDQFH7KHFRPSDQ\RSHUDWHVWKURXJKEUDQFKHVLQ5L\DGK-HGGDKDQG
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
.KREDU6ROLGDULW\SODQVWRRSHQQHZEUDQFKHVDFURVVPDMRUFLWLHVLQ6DXGL
$UDELD
3ULFHSHUIRUP 0
$EVROXWH
x )LQDQFLDOV
6ROLGDULW\¶VWRWDOJURVVZULWWHQSUHPLXPV*:3DQGQHWZULWWHQSUHPLXPV
HDUQHGIRUWRWDOHG65PQDQG65PQUHVSHFWLYHO\7KH
FRPSDQ\UHSRUWHGDQHWORVVRI65PQLQDVLWLVVWLOOLQWKHVWDJHRI
VHWWLQJXSRSHUDWLRQV
x 5HFHQWGHYHORSPHQWV
,Q$SULO6ROLGDULW\¶VLQVXUDQFHSURGXFWV¶WHPSRUDU\DSSURYDOZDV
H[WHQGHGIRUDSHULRGRIVL[PRQWKV,Q0DUFKWKHFRPSDQ\UHFHLYHG
DSSURYDOIURP6DXGL$UDELDQ0RQHWDU\$JHQF\6$0$WRPDUNHWDQGVHOO
PHGLFDOLQVXUDQFHSURGXFWV'XULQJWKHVDPHPRQWK6ROLGDULW\REWDLQHG
DSSURYDOIURP6$0$DQGWKH&RXQFLORI&RRSHUDWLYH+HDOWK,QVXUDQFHWRVHOO
DQGPDUNHWJURXSKHDOWKLQVXUDQFHSURGXFWV,Q6HSWHPEHUWKH%RDUG
DSSRLQWHG$GHOELQ$EGXOD]L]$O(VVDDV&KLHI([HFXWLYH2IILFHUUHSODFLQJ
6DOHKELQ1DVVHU$O2PDLU,Q0D\6$0$DSSURYHG6ROLGDULW\¶V
YHKLFOHLQVXUDQFHSURGXFWV
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
62/,'$5,$%
ZZZVVWFFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
7
)UHHIORDW
)
9$/8$7,2108/7,3/(6
$
$
3([
10
10
3%[
36[
10
10
'LY<LHOG
'36
$
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
<R<
10
10
10
10
1$
10
10
10
10
1$
10
10
10
10
10
10
10
1$
1HW,QV3UHPLXP 65PQ
65PQ
7RWDO5HYHQXHV
65PQ
1HW,QFRPH
65PQ
$VVHWV
65PQ
(TXLW\
65PQ
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV65PQ
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
65
(36
65
%936
&$*5
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
6ROLGDULW\5+6
7236+$5(+2/'(56
6ROLGDULW\&RPSDQ\
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
6RXUFH7DGDZXO1&%&5HVHDUFK
127
,1685$1&(~0$<
%83$$5$%,$
$/62.12:1$6%83$$5$%,$
%XSD$UDELDIRU&RRSHUDWLYH,QVXUDQFHDPHGLFDOLQVXUDQFH
FRPSDQ\ZDVHVWDEOLVKHGLQ-HGGDKLQ3ULRUWRLWV
OLVWLQJRQ7DGDZXO%XSD$UDELDFRQGXFWHGEXVLQHVVXQGHUD
MRLQWYHQWXUHEHWZHHQ1D]HU*URXSDQG%83$*URXS8.
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
%XSD$UDELDRIIHUVPHGLFDOLQVXUDQFHWRFRPSDQLHVEXVLQHVVHVDQG
IDPLOLHV7KHFRPSDQ\¶VFRUSRUDWHVHUYLFHVLQFOXGHFXVWRPL]HGKHDOWKFDUH
SODQVZKLFKKDYHEHHQGLYLGHGLQWR%83$'LUHFWDQG%83$&RUSRUDWH
672&.'(7$,/6
+HDOWK&DUH6FKHPH%83$'LUHFWWDUJHWVFRPSDQLHVZLWK±HPSOR\HHV ZHHNUDQJH+/65
WKURXJKWKUHHPDLQVFKHPHV([HFXWLYH&ODVVLFDQG(VVHQWLDO%83$
0DUNHWFDSPQ
&RUSRUDWH+HDOWK&DUH6FKHPHWDUJHWVFRPSDQLHVZLWKRYHUHPSOR\HHV
6KDUHVRXWVWDQGLQJPQ
%XSD$UDELDDOVRRIIHUVDPHGLFDOLQVXUDQFHVFKHPHXQGHUWKH%XSD
3ULFHSHUIRUP 0
&RUSRUDWHVFKHPHIRUFRPSDQLHVZLWKPRUHWKDQHPSOR\HHV
$EVROXWH
x )LQDQFLDOV
%XSD$UDELD¶VWRWDOUHYHQXHJUHZ<R<WR65PQLQPDLQO\
GXHWR<R<JURZWKLQQHWLQVXUDQFHSUHPLXP+RZHYHUWKH
FRPSDQ\¶VQHWLQFRPHGHFOLQHG<R<WR65PQGXHWRDFKDQJHLQ
WKHPHWKRGRIFDOFXODWLQJEDGGHEWVSURYLVLRQDVSHUFKDQJHVLQUHJXODWRU\
UHTXLUHPHQWV&RQVHTXHQWO\EDGGHEWSURYLVLRQLQFUHDVHGE\65PQLQ
,QDGGLWLRQJHQHUDODQGDGPLQLVWUDWLRQH[SHQVHVLQFUHDVHGUHVXOWLQJ
LQDKLJKHUFRPELQHGORVVUDWLRRIFRPSDUHGWRLQ
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
%83$$%
ZZZEXSDFRPVD
x 5HFHQWGHYHORSPHQWV
:(,*+7,1*)5(()/2$7
,Q2FWREHU&RXQFLORI&RRSHUDWLYH,QVXUDQFH&&+,DSSURYHGWKH
FRPSDQ\¶VUHTXDOLILFDWLRQIRU&&+,KHDOWKLQVXUDQFH
,Q-XO\%XSDVLJQHGDRQH\HDUUHQHZDEOHDJUHHPHQWWRUHFHLYH
6KDULDDGYLVRU\DQGDXGLWVHUYLFHVRQLWVDFWLYLWLHVDQGRSHUDWLRQVZLWKWKH
6KDUL\DK5HYLHZ%XUHDX
,Q-XQHWKHFRPSDQ\UHQHZHGLWVDFWLYLWLHVOLFHQVHIRUWKUHH\HDUVIURP
6DXGL$UDELDQ0RQHWDU\$JHQF\
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
%XSD$UDELD5+6
7236+$5(+2/'(56
%XSD0LGGOH(DVW+ROGLQJV
%XSD,QYHVWPHQWV/LPLWHG
0RGHUQ6RIWZDUH6ROXWLRQV&R
1DGKHU*URXS+ROGLQJ&R
$VVDV&RPSDQ\IRU+HDOWKFDUH
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
128
6RXUFH%ORRPEHUJ
,1685$1&(~0$<
*8/)*(1(5$/
$/62.12:1$6**,**&,
*XOI*HQHUDO&RRSHUDWLYH,QVXUDQFH&RPSDQ\*XOI*HQHUDO
ZDVHVWDEOLVKHGLQ'HFHPEHUWKURXJKWKHPHUJHURI
6DXGL*HQHUDO,QVXUDQFH&R6*,DQG*XOI&RRSHUDWLRQ
,QVXUDQFH&R*&,+HDGTXDUWHUHGLQ-HGGDKWKHFRPSDQ\
SURYLGHVYDULRXVJHQHUDOLQVXUDQFHVHUYLFHVLQ6DXGL$UDELD
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
*XOI*HQHUDORIIHUVLQVXUDQFHVHUYLFHVLQVHJPHQWVLQFOXGLQJILUHDFFLGHQW
672&.'(7$,/6
SURSHUW\HQJLQHHULQJYHKLFOHPDULQHFDUJRDQGKXOOKHDOWKDYLDWLRQDQG
ZHHNUDQJH+/65
HQHUJ\7KHFRPSDQ\KDVDOVREHHQDXWKRUL]HGWRSURYLGHSHUVRQDODFFLGHQW 0DUNHWFDSPQ
ZRUNPHQFRPSHQVDWLRQOLIHWKHIWEXUJODU\PRQH\ILGHOLW\SHFXQLDU\DQG
6KDUHVRXWVWDQGLQJPQ
OLDELOLW\LQVXUDQFHVHUYLFHV*XOI*HQHUDOKDVRIILFHVLQ-HGGDK5L\DGKDQG
3ULFHSHUIRUP 0
'DPPDP
$EVROXWH
x )LQDQFLDOV
*XOI*HQHUDO¶VQHWLQVXUDQFHSUHPLXPURVH<R<WR65PQLQ
IURP65PQLQ&RQVHTXHQWO\WRWDOUHYHQXHJUHZ<R<WR
65PQ+RZHYHUGXHWRDQLQFUHDVHLQWKHSURYLVLRQIRUGRXEWIXOGHEWV
,%15SURYLVLRQVDQGSUHRSHUDWLQJH[SHQVHVWKHFRPSDQ\UHSRUWHGDQHW
ORVVRI65PQGXULQJWKH\HDUFRPSDUHGWRDORVVRI65PQLQ
x 5HFHQWGHYHORSPHQWV
0
0
0DUNHW
6HFWRU
65
86
$YJGDLO\WXUQRYHUPQ
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
*XOI*HQHUDOUHFHLYHGDSSURYDOIURP6DXGL$UDELDQ0RQHWDU\$JHQF\
6$0$WRPDUNHWDQGVHOOJURXSLQVXUDQFHSURGXFWVLQ$SULODVZHOODV
YHKLFOHLQVXUDQFHDQGLQVXUDQFHWKDWFRYHUVSHUVRQDODFFLGHQWIRULQGLYLGXDOV
DVZHOODVFRPSDQLHVLQ0DUFK7KHFRPSDQ\DOVRREWDLQHG6$0$¶V
VL[PRQWKH[WHQVLRQRIWHPSRUDU\DSSURYDOWRVHOOLQVXUDQFHSURGXFWVLQ
0DUFK)XUWKHUPRUHLWUHFHLYHGDSSURYDOIURP6$0$LQ-DQXDU\
IRULQVXUDQFHSURGXFWVFRYHULQJFRPPHUFLDOJHQHUDOOLDELOLW\6$0$JUDQWHG
VL[PRQWKH[WHQVLRQRIWHPSRUDU\DSSURYDOWR*XOI*HQHUDOWRPDUNHW
LQVXUDQFHSURGXFWVLQ6HSWHPEHU,Q-XO\WKHFRPSDQ\UHFHLYHG
SURSHUW\LQVXUDQFHFODLPZRUWKDERXW65PQIRUILUHLQ$OHVD\L3OD]DLQ
-HGGDK²*XOI*HQHUDOFODLPVRIWKHYDOXHLVUHLQVXUHG
**&,$%
ZZZJJLVDFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
*XOI*HQHUDO5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
6DXGL*HQHUDO,QVXUDQFH&R
*XOI&RRSHUDWLYH,QVXUDQFH&R
$O)DGHO,QYHVWPHQWV
0RKDPPHG6DLG7DPU
&RPPHUFLDO,QYHVWPHQW
$EHOOD,QWHUQDWLRQDO5HDO(VWDWH
'HYHORSPHQW&R
$QVDI,QWHUQDWLRQDO5HDO(VWDWH
'HYHORSPHQW&R
6RXUFH7DGDZXO1&%&5HVHDUFK
129
,1685$1&(~0$<
$;$&223(5$7,9(
$/62.12:1$6$;$
$;$&RRSHUDWLYH,QVXUDQFH&RPSDQ\$;$&RRSHUDWLYHLV
SDUWRIWKH$;$*URXSKHDGTXDUWHUHGLQ)UDQFH(VWDEOLVKHG
LQ-XO\$;$&RRSHUDWLYHLVHQJDJHGLQSURYLGLQJYDULRXV
LQVXUDQFHDQGUHLQVXUDQFHVHUYLFHVIRULQGLYLGXDODQG
LQVWLWXWLRQDOFOLHQWVLQ6DXGL$UDELD
127&29(5('
&XUUHQWSULFH65 3ULFLQJRIDV
x %XVLQHVVEULHI
$;$&RRSHUDWLYHSURYLGHVLQVXUDQFHSROLFLHVVXLWDEOHIRULQGLYLGXDODVZHOODV
EXVLQHVVQHHGV7KHFRPSDQ\RIIHUVPRWRUSURSHUW\JROIUHORFDWLRQ\DFKW 672&.'(7$,/6
KHDOWKWUDYHODQGKRPHLQVXUDQFHSURGXFWVIRULQGLYLGXDOV,WDOVRSURYLGHV
ZHHNUDQJH+/65
PDULQHILUHHQJLQHHULQJOLIHDQGOLDELOLW\LQVXUDQFHVHUYLFHVWRFRUSRUDWH
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
FXVWRPHUV$;$&RRSHUDWLYHRSHUDWHVWKURXJKRIILFHVLQ5L\DGK-HGGDKDQG
'DPPDPLQ6DXGL$UDELD
3ULFHSHUIRUP 0
$EVROXWH
x )LQDQFLDOV
1HWLQVXUDQFHSUHPLXPVWRRGDW65PQLQFRPSDUHGWR65PQ
IRUWKHPRQWKVHQGHG'HFHPEHU7RWDOUHYHQXHVZHUHUHSRUWHGDW
65PQIRU+RZHYHUWKHFRPSDQ\UHFRUGHGDQHWORVVRI65PQ
GXHWRDULVHLQQHWFODLPVLQFXUUHGZKLFKLQFUHDVHGE\65PQFRPSDUHG
WRSUHYLRXVUHSRUWHGQXPEHUVIRUWKHPRQWKV
x 5HFHQW'HYHORSPHQWV
,Q-DQXDU\$;$&RRSHUDWLYHDQQRXQFHG6DXGL$UDELDQ0RQHWDU\
$JHQF\¶V6$0$DSSURYDOIRUWKHH[WHQVLRQRISURYLVLRQDODSSURYDORI
LQVXUDQFHSURGXFWVIRUDSHULRGRIVL[PRQWKV,Q2FWREHUWKHFRPSDQ\
DQQRXQFHGWKDWWKHORVVHVLWLQFXUUHGGXHWRWKHILUHLQ&HQWHU3RLQW5L\DGK
ZHUHUHLQVXUHG,Q6HSWHPEHU$;$&RRSHUDWLYHDQQRXQFHGWKDW
LWDSSRLQWHG:DVHHOD,QVXUDQFH$JHQF\DVWKHFRPSDQ\
VVDOHVDQG
PDUNHWLQJDJHQW
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$;$$%
ZZZD[DJXOIFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
6+$5(35,&(3(5)250$1&(
<R<
&$*5
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
10
10
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65
65
10
10
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
QXPEHUVDUHIRUPRQWKVIURP-XQHWR'HFHPEHU
0D\
6HS
7$6,
-DQ
0D\
$;$5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$;$,QVXUDQFH*XOI%DKUDLQ
$;$0HGLWHUUDQHDQ6HD+ROGLQJ
6RXUFH7DGDZXO1&%&5HVHDUFK
130
,1685$1&(~0$<
$/5$-+,&223(5$7,9(
$/62.12:1$6$5&&,
(VWDEOLVKHGLQLQ%DKUDLQ$O5DMKL&RPSDQ\IRU
&RRSHUDWLYH,QVXUDQFH$5&&,LVDQ,VODPLFLQVXUDQFH
FRPSDQ\7KHFRPSDQ\VHWXSRSHUDWLRQVLQ6DXGL$UDELDLQ
-XO\$5&&,SURYLGHVFRRSHUDWLYHLQVXUDQFHDQG
UHLQVXUDQFHVHUYLFHVLQFRPSOLDQFHZLWK6KDULD¶DSULQFLSOHVWR
LQGLYLGXDOVDQGFRUSRUDWHVLQ6DXGL$UDELD
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
$5&&,RIIHUVJHQHUDOKHDOWKDQGIDPLO\LQVXUDQFHSURGXFWVDQGVHUYLFHV
672&.'(7$,/6
8QGHUJHQHUDOLQVXUDQFHWKHFRPSDQ\SURYLGHVSURSHUW\PDULQHKXOODQG
ZHHNUDQJH+/65
FDUJRDYLDWLRQHQJLQHHULQJOLDELOLW\FDVXDOW\WUDYHOPRWRUZRUNPHQ¶V
0DUNHWFDSPQ
FRPSHQVDWLRQILGHOLW\JXDUDQWHHPHGLFDOPDOSUDFWLFHDQGUHODWHGSURGXFWV
6KDUHVRXWVWDQGLQJPQ
8QGHUKHDOWKLQVXUDQFHWKHFRPSDQ\RIIHUVSURGXFWVIRULQGLYLGXDOVIDPLOLHV
3ULFHSHUIRUP 0
DQGFRPSDQLHV$5&&,RIIHUVKHDOWKSODQVWKDWIXOO\FRPSO\ZLWKWKH
$EVROXWH
UHTXLUHPHQWVRIWKH&RXQFLOIRU&RRSHUDWLYH+HDOWK,QVXUDQFH&&+,7KH
0DUNHW
FRPSDQ\RSHUDWHVWKURXJKDQHWZRUNRIWKUHHEUDQFKHVLQ5L\DGK-HGGDK
6HFWRU
DQG'DPPDPLWVKHDGRIILFHLVORFDWHGLQ5L\DGK
$5&&,UHFRUGHGWRWDOUHYHQXHVDPRXQWLQJWR65PQLQFRPSDUHGWR
65PQIRUWKHPRQWKVHQGHG'HFHPEHU1HWLQVXUDQFHSUHPLXP
ZKLFKDFFRXQWHGIRURIWKHUHYHQXHVVWRRGDW65PQ'HVSLWH
LQFUHDVHGUHYHQXHVWKHFRPSDQ\UHSRUWHGDQHWORVVRI65PQGXHWRD
LQFUHDVHLQQHWFODLPVLQFXUUHGFRPSDUHGWRWKHPRQWKSHULRGIURP
-XQHWR'HFHPEHUWKHUHZDVDOVRDULVHLQWKHJHQHUDODQG
DGPLQLVWUDWLRQH[SHQVHV
0
$YJGDLO\WXUQRYHUPQ
x )LQDQFLDOV
0
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$5&&,$%
ZZZDOUDMKLWDNDIXOFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
x 5HFHQWGHYHORSPHQWV
,Q0DUFKWKHFRPSDQ\DQQRXQFHGWKHFKDQJHRILWVQDPHIURP$O
5DMKL&RPSDQ\IRU&RRSHUDWLYH,QVXUDQFHWR$O5DMKL&RPSDQ\IRU
&RRSHUDWLYH,QVXUDQFH7DNDIXO$O5DMKLZKLFKZRXOGEHDSSURYHGLQWKH
(*0VRRQ7KHFRPSDQ\UHFHLYHG6$0$¶VLQWHULPDSSURYDOIRULWVSHUVRQDO
DFFLGHQWLQVXUDQFHSURGXFWLQ1RYHPEHUDQGHUURUVDQGRPLVVLRQ
LQVXUDQFHSURGXFWLQ6HSWHPEHU
9$/8$7,2108/7,3/(6
$
$
3([
10
10
10
3%[
36[
'LY<LHOG
'36
$
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
ILJXUHVDUHIRUPRQWKV
<R<
10
10
10
10
&$*5
10
10
10
10
0D\
6HS
7$6,
-DQ
0D\
$O5DMKL&R5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$O5DMKL%DQNLQJDQG,QYHVWPHQW
$O5DMKL,QVXUDQFH/WG
2PDQ,QVXUDQFH&RPSDQ\
$O5DPWDQ6XPPLW&R
6RXUFH7DGDZXO1&%&5HVHDUFK
131
,1685$1&(~0$<
75$'(81,21&223
$/62.12:1$678&,&78&,
6DXGL$UDELDEDVHG7UDGH8QLRQ&RRSHUDWLYH,QVXUDQFH
5HLQVXUDQFH&RPSDQ\7UDGH8QLRQZDVHVWDEOLVKHGLQ
7KHFRPSDQ\LVKHDGTXDUWHUHGLQ$O.KREDUDQGUHJLVWHUHG
ZLWKWKH&RXQFLORI&RRSHUDWLYH+HDOWK,QVXUDQFH&&+,
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
7UDGH8QLRQ¶VSURGXFWSRUWIROLRLQFOXGHVSURSHUW\LQVXUDQFHILUHDQGDOOLHG
SHULOVOLDELOLW\LQVXUDQFHJHQHUDODQGSURGXFWPDULQHLQVXUDQFHKXOOFDUJR
DQGODQGWUDQVLWFULPHLQVXUDQFHEXUJODU\DQGFRPSXWHUIUDXGHQJLQHHULQJ 672&.'(7$,/6
LQVXUDQFHPDFKLQHU\EUHDNGRZQDQGFRQWUDFWRU¶VULVNVPRWRULQVXUDQFH
ZHHNUDQJH+/65
FRPPHUFLDORUKHDY\YHKLFOHVDQGSHUVRQDOOLQHVSHUVRQDODFFLGHQWQHZ
0DUNHWFDS65PQ
YHKLFOHZDUUDQW\DQGKRXVHKROGFRPSUHKHQVLYH7KHFRPSDQ\DOVRSURYLGHV 6KDUHVRXWVWDQGLQJPQ
PHGLFDODQGOLIHLQVXUDQFHSURGXFWVDVZHOODVUHLQVXUDQFHVHUYLFHVOHGE\
3ULFHSHUIRUP 0
6ZLVV5HLQVXUDQFH&R,WVPHGLFDOWUHDW\LVVHFXUHGE\0XQLFK5H7UDGH
$EVROXWH
8QLRQKDVUHLQVXUDQFHWUHDWLHVZLWKHLJKWUHLQVXUHUV+DQRYHU5H6ZLVV5H
0DUNHW
&&5595H2GHVVH\5H6&253DULV5HDQG0DSHUH5H+DQRYHU5H
6HFWRU
LVWKHFRPSDQ\¶VOHDGLQJUHLQVXUHU
0
$YJGDLO\WXUQRYHUPQ
x )LQDQFLDOV
7UDGH8QLRQ¶VQHWLQVXUDQFHSUHPLXPJUHZ<R<WR65PQLQ
IURP65PQLQ&RQVHTXHQWO\WRWDOUHYHQXHVURVH<R<DV
QHWLQVXUDQFHSUHPLXPHDUQHGDFFRXQWVIRURIWRWDOUHYHQXH7KH
FRPSDQ\¶VQHWLQFRPHDOVRLQFUHDVHGLQWDQGHPZLWKUHYHQXHULVLQJ
<R<WR65PQ7KHJURZWKLQQHWLQFRPHFDQEHDVFULEHGWRDQLQFUHDVHLQ
VKDUHKROGHUV¶QHWLQYHVWPHQWUHWXUQ
x 5HFHQWGHYHORSPHQWV
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
75'81,21$%
ZZZWXLVDFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
,Q$SULO6DXGL$UDELDQ0RQHWDU\$JHQF\6$0$DSSURYHGFKDQJHLQ
WKHFRPSDQ\¶VQDPHIURP7UDGH8QLRQ&RRSHUDWLYH,QVXUDQFH&RPSDQ\WR
7UDGH8QLRQ&RRSHUDWLYH,QVXUDQFH&RPSDQ\´,WWLKDG6$0$JUDQWHGVL[
PRQWKH[WHQVLRQWRSURYLVLRQDODSSURYDORQWKHFRPSDQ\¶VLQVXUDQFH
SURGXFWVGXULQJWKHVDPHPRQWK,Q)HEUXDU\7UDGH8QLRQDQQRXQFHG
SODQVWRLQFUHDVHLWVFDSLWDOE\WKURXJKERQXVVKDUHVWR65PQ,Q
'HFHPEHULWUHFHLYHG%%%FUHGLWUDWLQJIURP$0%HVW
0
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
1$
1$
1$
10
1$
1$
1$
1$
1$
1$
1$
1$
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R< &$*5
10
10
10
10
0D\
6HS
7$6,
-DQ
0D\
7UDGH8QLRQ5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
8QLWHG&RPPHUFLDO,QVXUDQFH&R
$O$KOLD,QVXUDQFH&RPSDQ\
6RXUFH7DGDZXO1&%&5HVHDUFK
132
,1685$1&(~0$<
81,7('&223(5$7,9(
$/62.12:1$68&$
8QLWHG&RRSHUDWLYH$VVXUDQFH&RPSDQ\8&$LVHQJDJHGLQ
WKHLQVXUDQFHEXVLQHVVLQ6DXGL$UDELD7KHFRPSDQ\ZDV
HVWDEOLVKHGLQ-HGGDKLQDVDVHSDUDWHHQWLW\IURP8&$
,QVXUDQFH&RRI%DKUDLQ8&$ZDVOLVWHGRQ7DGDZXOLQ-XQH
127&29(5('
&XUUHQWSULFH65
3ULFLQJDVRI
x %XVLQHVVEULHI
8&$RIIHUVLQVXUDQFHSURGXFWVVXFKDVHQJLQHHULQJFRQWUDFWRU¶VULVNV
PDFKLQHU\DQGSODQWHTXLSPHQWXVHGIRUFRQVWUXFWLRQPHGLFDOSHUVRQDO
DFFLGHQWDQGSURWHFWLRQPRWRULQVXUDQFHDQGPDULQHFDUJR7KHFRPSDQ\¶V
HPSOR\HHVVHUYHFOLHQWVWKURXJKRIILFHVLQWKUHHPDMRUFLWLHVRIWKH
.LQJGRP-HGGDK5L\DGKDQG.KREDU
8&$¶VQHWLQVXUDQFHSUHPLXPDQGWRWDOUHYHQXHJUHZDQG
<R<UHVSHFWLYHO\LQ+RZHYHUQHWLQFRPHGHFOLQHG<R<WR
65PQ7KHIDOOLQQHWLQFRPHFDQEHPDLQO\DVFULEHGWRKLJKHUJHQHUDODQG
DGPLQLVWUDWLYHH[SHQVHVDQGWHFKQLFDOUHVHUYHVGXHWRDQLQFUHDVHLQJURVV
ZULWWHQSUHPLXPV$GHFOLQHLQLQYHVWPHQWLQFRPHIURPSROLF\KROGHUV¶
SRUWIROLRDOVRFRQWULEXWHGWRZDUGORZHUQHWLQFRPH
x 5HFHQWGHYHORSPHQWV
,Q0DUFK8&$DQQRXQFHGWKHDSSURYDORIGLVWULEXWLRQRIFDVK
GLYLGHQGV65SHUVKDUHIRUWKH\HDU,Q1RYHPEHUWKH
FRPSDQ\UHFHLYHGDSSURYDOIURPWKH6DXGL$UDELDQ0RQHWDU\$JHQF\WR
UHQHZLQVXUDQFHDQGUHLQVXUDQFHOLFHQVHWRSURFHHGZLWKLWV*HQHUDO
,QVXUDQFHDQG0HGLFDO,QVXUDQFHDFWLYLWLHVIRUDWKUHH\HDUWHUP8&$¶V
TXDOLILFDWLRQZDVUHQHZHGE\7KH&RXQFLORI&RRSHUDWLYH+HDOWK,QVXUDQFHLQ
-XO\7KLVZRXOGHQDEOHWKHFRPSDQ\WRLVVXHKHDOWKLQVXUDQFHSROLFLHV
LQDFFRUGDQFHZLWKFRRSHUDWLYHKHDOWKLQVXUDQFHSROLF\VWDQGDUGV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
ZHHNUDQJH+/65
0DUNHWFDS65PQ
6KDUHVRXWVWDQGLQJPQ
x )LQDQFLDOV
672&.'(7$,/6
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
8&$$%
ZZZXFDFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
1$
1$
1$
1$
10
1$
1$
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
)RUWKHPRQWKVWRHQG
<R<
&$*5
10
10
10
10
10
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
0D\
-DQ
8&$5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
8&$,QVXUDQFH&R
$O)DLVDOLDK*URXS+ROGLQJ
&LYLO:RNV&R
6RXUFH7DGDZXO1&%&5HVHDUFK
133
,1685$1&(~0$<
6$%%7$.$)8/
$/62.12:1$60('*8/)6$8',
6$%%7DNDIXOZDVHVWDEOLVKHGLQLQ5L\DGKDVDQ
DVVRFLDWHFRPSDQ\RI6$%%DQG+6%&7KHFRPSDQ\
FRQGXFWVLWVEXVLQHVVWKURXJK6$%%¶VHVWDEOLVKHG
GLVWULEXWLRQQHWZRUNEUDQFKHVDQGGLUHFWVDOHVWHDP
DFURVV6DXGL$UDELD6$%%7DNDIXO¶VLQVXUDQFHSURGXFWVDUH
6KDULD¶DFRPSOLDQW
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
6$%%7DNDIXORIIHUVSURGXFWVXQGHUWKH)DPLO\*HQHUDO&RUSRUDWHDQG
*URXS7DNDIXOFDWHJRULHV8QGHUWKH)DPLO\7DNDIXOVHJPHQWWKHFRPSDQ\
FRYHUVHGXFDWLRQVDYLQJVUHWLUHPHQWDQGLQYHVWPHQWSODQV7KH*HQHUDO
7DNDIXOVHJPHQWFRYHUVHYHU\GD\WUDYHOKRPHDQGSHUVRQDODFFLGHQWULVNV
&RUSRUDWH7DNDIXOSURYLGHVFRYHUIRUPDULQHFDUJRFRPPHUFLDOILUH
SURWHFWLRQDQGEXVLQHVVWDNDIXOVROXWLRQVIRU60(V
x )LQDQFLDOV
,QWKHFRPSDQ\¶VQHWLQVXUDQFHSUHPLXPUHJLVWHUHG<R<JURZWK
WR65PQ6$%%7DNDIXO¶VQHWHDUQHGSUHPLXPFRQWULEXWHVRILWV
WRWDOUHYHQXHV&RQVHTXHQWO\WRWDOUHYHQXHVLQFUHDVHG<R<WR
65PQ6$%%7DNDIXO¶VQHWLQFRPHURVHWR65PQLQIURPDORVV
RI65PQLQGXHWRDQLQFUHDVHLQWKHQHWHDUQHGFRQWULEXWLRQRZLQJ
WRWKHUHOHDVHRIUHVHUYHVDQGIDOOLQRSHUDWLQJH[SHQVHGXULQJWKH\HDU
x 5HFHQWGHYHORSPHQWV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6$%%7$%
ZZZVDEEWDNDIXOFRP
,Q2FWREHUWKHFRPSDQ\UHFHLYHGDQH[WHQVLRQRIWKHSURYLVLRQDO
DSSURYDORILWVLQVXUDQFHSURGXFWVIURP6DXGL$UDELDQ0RQHWDU\$JHQF\
6$0$,Q$XJXVW6$0$DSSURYHGWZRQHZSURGXFWVRI6$%%7DNDIXO
IRUDSHULRGRIVL[PRQWKV
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
)LQDQFLDOVRIIRU0RQWKV
<R<
10
10
&$*5
10
10
0D\
6HS
7$6,
-DQ
0D\
6$%%7DNDIXO5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
6$%%
+6%&+ROGLQJ&R
6RXUFH7DGDZXO1&%&5HVHDUFK
134
,1685$1&(~0$<
$/$+/,7$.$)8/
$/62.12:1$6$7&
$O$KOL7DNDIXO&RPSDQ\$7&HVWDEOLVKHGLQLVDMRLQW
YHQWXUHEHWZHHQ1DWLRQDO&RPPHUFLDO%DQN):8$*
,QWHUQDWLRQDO)LQDQFLDO&RUSRUDWLRQDQG9+97KHFRPSDQ\
KHDGTXDUWHUHGLQ-HGGDKSURYLGHVDUDQJHRIWDNDIXO
LQVXUDQFHSURGXFWVDQGVHUYLFHVLQ6DXGL$UDELD
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
$7&RIIHUVDUDQJHRIILQDQFLDOSODQQLQJSURGXFWVIRUVDYLQJVUHWLUHPHQW
HGXFDWLRQDQGPDUULDJH7KHFRPSDQ\¶V³$O$KOL7DNDIXODQG6DYLQJ3URJUDP´ 672&.'(7$,/6
SURYLGHVPDWXULW\EHQHILWE\LQYHVWLQJUHJXODUFRQWULEXWLRQVDQGGHDWKEHQHILW ZHHNUDQJH+/65
WKURXJKWKHFRYHUDJHRISDLGDQGIXWXUHFRQWULEXWLRQV
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
x )LQDQFLDOV
,Q$7&¶VWRWDOUHYHQXHVGHFUHDVHG<R<WR65PQGXHWRD
IDOOLQQHWLQVXUDQFHSUHPLXPHDUQHGLQWKHFRPSDQ\¶VRQO\VRXUFHRI
UHYHQXH1HWLQFRPHORVVHVGHFUHDVHGWR65PQLQFRPSDUHGWR
65PQLQGXHWRDIDOOLQJHQHUDODQGDGPLQLVWUDWLYH
H[SHQVHVLQOLQHZLWKWKHFRPSDQ\¶VVWUDWHJ\WRUHGXFHH[SHQVHV
x 5HFHQWGHYHORSPHQWV
,Q'HFHPEHU$7&DQQRXQFHGWKDWLWKDGVLJQHGDQDJUHHPHQWZLWK
1DWLRQDO&RPPHUFLDO%DQNWRSURYLGHWKHODWWHU
VHPSOR\HHVZLWKLQVXUDQFH
SURGXFWV,Q1RYHPEHUWKHFRPSDQ\DQQRXQFHGSODQVWRLQFUHDVHLWVFDSLWDO
E\IURP65PQWR65PQE\LVVXLQJIRUULJKWLVVXH
VKDUHVDW65SHUVKDUH
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$7&$%
ZZZDODKOLWDNDIXOFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
3([
10
10
10
3%[
36[
$
10
10
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
10
10
&$*5
10
10
10
10
0D\
6HS
-DQ
7$6,
0D\
$7&5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
1DWLRQDO&RPPHUFLDO%DQN
):8*URXS
,QWHUQDWLRQDO)LQDQFH&RUSRUDWLRQ
9+9&R
6RXUFH7DGDZXO1&%&5HVHDUFK
135
,1685$1&(~0$<
$/6$*5&203$1<
$/62.12:1$6$/6$*56$8',
$O6DJU&RPSDQ\IRU&RRSHUDWLYH,QVXUDQFH6DJU,QVXUDQFH
FRPPHQFHGRSHUDWLRQVLQ6DXGL$UDELDLQDVDEUDQFKRI
$O6DJU1DWLRQDO,QVXUDQFH&R$61,&'XEDL+HDGTXDUWHUHG
LQ$O.KREDU6DJU,QVXUDQFHRSHUDWHVWKURXJKLWVWKUHH
EUDQFKHVLQ'DPPDP5L\DGKDQG-HGGDK
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
6DJU,QVXUDQFH¶VZLGHUDQJHRILQVXUDQFHSURGXFWVFRPSULVHVILUHDQG
JHQHUDOSURSHUW\HQJLQHHULQJOLDELOLW\DQGPLVFHOODQHRXVPDULQHFDUJR
DQGKXOOPRWRUOLIHDQGPHGLFDOLQVXUDQFHVHUYLFHV7KHFRPSDQ\DOVR
SURYLGHVMHZHOOHU\PHUFKDQWLQVXUDQFHKRWHOIXUQLVKHGDSDUWPHQWVEODQNHW
LQVXUDQFHDQGUHLQVXUDQFHVHUYLFHV,WKDVUHLQVXUDQFHWUHDWLHVZLWKUH
LQVXUHUVLQWKH0LGGOH(DVWDQG(XURSHLQFOXGLQJ$OOLDQ]5HDQG&RQYHULXP
*HUPDQ\2G\VVH\5H)UDQFH7DNDIXO5H8$(DQG%(675(7XQLV
x )LQDQFLDOV
6DJU,QVXUDQFH¶VQHWLQVXUDQFHSUHPLXPJUHZ<R<WR65PQLQ
7RWDOUHYHQXHVLQFUHDVHGWR65PQPDLQO\GXHWRJURZWK
LQQHWLQVXUDQFHSUHPLXPZKLFKFRQWULEXWHGWRWRWDOHDUQLQJV6DJU
,QVXUDQFH¶VQHWLQFRPHLQFUHDVHGVLJQLILFDQWO\E\<R<WR65PQLQ
DVLWVWRWDORSHUDWLQJFRVWVLQFUHDVHGMXVW<R<DJDLQVWDQ
JURZWKLQUHYHQXH&RQVHTXHQWO\LWVFRPELQHGUDWLRDOVRIHOOIURPLQ
WRLQWKXVLQFUHDVLQJLWVQHWPDUJLQWRIURPLQ
x 5HFHQWGHYHORSPHQWV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
65
86
$YJGDLO\WXUQRYHUPQ
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6$*5$%
ZZZDOVDJUVDXGLFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
,Q-DQXDU\6DJU,QVXUDQFHZDVDVVLJQHGD
%%%
ORQJWHUP
FRXQWHUSDUW\FUHGLWDQGLQVXUHUILQDQFLDOVWUHQJWKUDWLQJZLWKVWDEOHRXWORRNE\
6WDQGDUG3RRU
V,Q'HFHPEHUWKHFRPSDQ\UHFHLYHG6DXGL$UDELDQ
0RQHWDU\$JHQF\
VDSSURYDORQQHZLQVXUDQFHSURGXFWV,Q0D\LW
VWDUWHGVHYHQQHZEUDQFKHV-HGGDK$EKD.KDPLV0XVKD\W$O.KREDU$O
4DWLI7DEXNDQG1DMUDQ
)UHHIORDW
9$/8$7,2108/7,3/(6
$
3([
$
$
3%[
36[
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
6DJU,QVXUDQFH5+6
7236+$5(+2/'(56
$O6DTDU1DWLRQDO,QVXUDQFH&R
$UDELDQ5HG/DQG,QGXVWULDO
6HUYLFHV
$EGXOODK5DVKHHG$O5DVKHHG
6RQV&R
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
136
,1685$1&(~0$<
$/$/$0,<$
$/62.12:1$6$/$/$0,<$
$O$ODPL\D&RRSHUDWLYH,QVXUDQFH&RPSDQ\$O$ODPL\DZDV
HVWDEOLVKHGLQ5L\DGKLQ-XQH7KHFRPSDQ\ZDVOLVWHG
RQWKH6DXGL$UDELDQ6WRFN([FKDQJH7DGDZXOLQ'HFHPEHU
$O$ODPL\DLVLQWKHLQLWLDOVWDJHVRIEXVLQHVVDQGRIIHUV
ILUHPRWRUPDULQHSURSHUW\DQGKHDOWKLQVXUDQFH
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
$O$ODPL\DKDVUHFHLYHGDSSURYDOIRUFRQGXFWLQJRSHUDWLRQVDVZHOODVVHOOLQJ
LQVXUDQFHSURGXFWVLQ6DXGL$UDELD+RZHYHUPDQ\RIWKHFRPSDQ\¶V
672&.'(7$,/6
SURGXFWVDUHXQGHUJRLQJWKHUHJXODWRU\DSSURYDOSURFHVVZLWK6DXGL$UDELDQ ZHHNUDQJH+/65
0RQHWDU\$JHQF\6$0$,Q)HEUXDU\WKHFRPSDQ\DFTXLUHGWKH
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
LQVXUDQFHEXVLQHVVRI5R\DO6XQ$OOLDQFH,QVXUDQFH&R
x )LQDQFLDOV
3ULFHSHUIRUP
$O$ODPL\DUHSRUWHGQLOUHYHQXHVIRUDVWKHFRPSDQ\LVVWLOOLQ
RSHUDWLRQDOSKDVH1HWORVVEHIRUH]DNDWRI65PQZDVGXHWRJHQHUDO
DQGDGPLQLVWUDWLYHFRVWVEHLQJPRUHWKDQLQFRPHIURPEDQNGHSRVLWVDQG
DOVRRZLQJWRKLJKLQFRUSRUDWLRQDQGIORDWDWLRQH[SHQVH
x 5HFHQWGHYHORSPHQWV
,Q)HEUXDU\$O$ODPL\DDQQRXQFHGWKDW6$0$KDVDJUHHGXSRQWKH
SRUWIROLRWUDQVIHUIURP5R\DO6XQ$OOLDQFH0LGGOH(DVW/LPLWHGWR$O
$ODPL\DWKLVZRXOGUHIOHFWLQWKHFRPSDQ\
V4ILQDQFLDOVWDWHPHQWV,Q
2FWREHUWKHFRPSDQ\DQQRXQFHGWKDW6$0$KDVH[WHQGHGLWV
DSSURYDORILQVXUDQFHSURGXFWVIRUDSHULRGRIVL[PRQWKV,Q2FWREHU
LWDSSRLQWHG0U0LFKDHO:LOOLDP-DNHPDQDV0DQDJLQJ'LUHFWRURQDQ
LQWHULPEDVLV+HUHSODFHG0U+DVVDQ$OL1DVVHUZKRUHVLJQHGLQ
6HSWHPEHUDV0DQDJLQJ'LUHFWRUDQG&KLHI([HFXWLYH2IILFHU
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$/$/$0,<$%
ZZZDODPL\DLQVXUDQFHFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
10
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
10
10
10
1$
10
10
10
1$
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
$ODPL\DK5+6
7236+$5(+2/'(56
5R\DO6XQ$OOLDQFH,QVXUDQFH
5L\DG%DQN,QYHVWPHQW3RUWIROLR
6RXUFH7DGDZXO1&%&5HVHDUFK
137
6RXUFH%ORRPEHUJ
,1685$1&(~0$<
:(4$<$7$.$)8/
$/62.12:1$6:(4$<$
:HTD\D7DNDIXO,QVXUDQFH5HLQVXUDQFH&RPSDQ\:HTD\D
ZDVHVWDEOLVKHGLQ0D\ZLWKDSDLGXSFDSLWDORI
65PQ7KHFRPSDQ\LVKHDGTXDUWHUHGLQ5L\DGKZLWK
UHJLRQDORIILFHVLQ-HGGDKDQG'DPPDP:HTD\DRIIHUV
LQVXUDQFHSURGXFWVLQKHDOWKFDUHJHQHUDOLQVXUDQFHDQG
UHLQVXUDQFHVHJPHQWV
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65
3ULFLQJDVRI
:HTD\D¶VLQVXUDQFHSRUWIROLRLQFOXGHVPRWRUSURSHUW\HQJLQHHULQJPDULQH
FDUJRDFFLGHQWKHDOWKDVZHOODV7DNDIXOSURWHFWLRQDQGVDYLQJVSURGXFWV
672&.'(7$,/6
ZHHNUDQJH+/6
0DUNHWFDSPQ
x )LQDQFLDOV
:HTD\D¶VQHWLQVXUDQFHSUHPLXPURVHWR65PQLQIURP65PQLQ
&RQVHTXHQWO\WRWDOUHYHQXHLQFUHDVHGWR65PQIURP65PQLQ
'HVSLWHKLJKHUUHYHQXHVWKHFRPSDQ\UHSRUWHGDQHWORVVRI65PQ
LQORZHUWKDQWKHSUHYLRXV\HDU¶VORVVRI65PQ7KLVLVPDLQO\
GXHWRKLJKHUSURYLVLRQVZKLFKLQFOXGHKLJKFXVWRPXQHDUQHGSUHPLXPVDQG
DOORZDQFHRIUHSRUWHGDQGXQUHSRUWHGFODLPV
x 5HFHQWGHYHORSPHQWV
,Q1RYHPEHU:HTD\DDQQRXQFHGWKHH[WHQVLRQRIWHPSRUDU\DSSURYDO
IURP6DXGL$UDELDQ0RQHWDU\$JHQF\RQLQVXUDQFHSURGXFWVIRUDVL[
PRQWKSHULRG'XULQJWKHVDPHPRQWK6WDQGDUG3RRU¶VDVVLJQHGWKH
FRPSDQ\%%%UDWLQJIRULWVORQJWHUPFRXQWHUSDUW\FUHGLWDQGILQDQFLDO
VWUHQJWK,Q-XQH:HTD\D¶VTXDOLILFDWLRQZDVUHQHZHGE\7KH&RXQFLO
RI&RRSHUDWLYH+HDOWKIRURQH\HDU
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
65
86
$YJGDLO\WXUQRYHUPQ
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
:(4$<$$%
ZZZZHTD\DFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
10
3%[
36[
10
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
1$
1$
1$
1$
1$
1$
1$
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
QXPEHUVDUHIRUVL[PRQWKVSHULRGIURP-XQHWR'HFHPEHU
<R< &$*5
10
10
10
6+$5(35,&(3(5)250$1&(
10
10
10
10
10
0D\
6HS
7$6,
-DQ
0D\
:HTD\D5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
)LUVW,QYHVWPHQW7DNDIXO&R
5DQD,QYHVWPHQW&R
$EGXO$]L]$O$MODQ6RQV
$O0DO,QYHVPWPHQW+RXVH
,QWHUQDWLRQDO)LQDQFLDO$GYLVRUV
6RXUFH7DGDZXO1&%&5HVHDUFK
138
,1685$1&(~0$<
$5$%,$,1685$1&(
$/62.12:1$6$,&&
(VWDEOLVKHGLQ$UDELD,QVXUDQFH&RRSHUDWLYH&RPSDQ\
$,&&LVKHDGTXDUWHUHGLQ5L\DGK7KHFRPSDQ\KDVEHHQ
LVVXLQJLQVXUDQFHSROLFLHVVLQFH-DQXDU\
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
$,&&LVHQJDJHGLQLQVXUDQFHDVZHOODVUHLQVXUDQFHDFWLYLWLHVDQGVHUYLFHV
DFURVV6DXGL$UDELD7KHFRPSDQ\LVDXWKRUL]HGWRRIIHULQVXUDQFHSURGXFWV
LQFOXGLQJPRWRUSURSHUW\PDULQHHQJLQHHULQJKHDOWKDQGJHQHUDODFFLGHQW
LQVXUDQFH$,&&DOVRRIIHUVWHUPLQVXUDQFHSURWHFWLRQSODQVDQGXQLWOLQNHG
672&.'(7$,/6
VDYLQJVSODQV)XUWKHUPRUHLWLVORRNLQJWRH[SDQGLQWRWKHPDUNHWIRU7DNDIXO ZHHNUDQJH+/65
OLIHSROLFLHVDQGLQYHVWPHQWSURGXFWV7KHFRPSDQ\RSHUDWHVWKURXJKLWV
0DUNHWFDSPQ
EUDQFKHVLQ5L\DGK-HGGDK0HNNDK7DLI'DPDP.KREDU+DIXIDQG
6KDUHVRXWVWDQGLQJPQ
.KDPLV0XVKHW
3ULFHSHUIRUP
x )LQDQFLDOV
$,&&¶VUHYHQXHLQFUHDVHG<R<WR65PQLQ1HWLQVXUDQFH
SUHPLXPURVH<R<WR65PQLQ1HWLQFRPHH[SDQGHG
WR65PQLQRYHUWKDWLQRQDFFRXQWRI<R<JURZWKLQWKHWRSOLQH
IRUWKH\HDU&RQVHTXHQWO\WKHFRPSDQ\¶V52(LQFUHDVHGWRLQ
IURPLQ
0
0
0
$EVROXWH
0DUNHW
6HFWRU
65
86
$YJGDLO\WXUQRYHUPQ
0
0
5HXWHUVFRGH
x 5HFHQWGHYHORSPHQWV
,Q$SULO$,&&UHFHLYHGD%UDWLQJIRUILQDQFLDOVWUHQJWKDQG³EEE´IRU
LVVXHUFUHGLWIURP$0%HVW,Q0DUFK6DXGL$UDELDQ0RQHWDU\$JHQF\
6$0$DSSURYHGWKHLVVXHRIWKHFRPSDQ\¶V)LUHDQG7KHIW,QVXUDQFH
SURGXFWV,Q-DQXDU\$,&&REWDLQHGDSSURYDOIURP6$0$WRRIIHU
&ROOHFWLYH/LIHLQVXUDQFHSURGXFWDQGH[WHQGSURYLVLRQDODSSURYDORI
LQVXUDQFHSURGXFWVIRUDSHULRGRIVL[PRQWKV,Q'HFHPEHUWKH
&RXQFLORI6DXGL&KDPEHUVDSSURYHGWKHFRPSDQ\
VRIIHUWRSURYLGH
&RPPHUFLDO,QGXVWULDO&KDPEHUV¶HPSOR\HHVZLWKDIXOOPHGLFDOLQVXUDQFH
VHUYLFH7KLVFRQWUDFWZRXOGEHUHIOHFWHGLQ$,&&¶VILQDQFLDOVWDWHPHQWVIRU
4,QWKHVDPHPRQWKWKHFRPSDQ\REWDLQHGDSSURYDOIURP6$0$WR
PDUNHWDQGVHOOZRUNHU¶VFRPSHQVDWLRQLQVXUDQFH
6(
%ORRPEHUJFRGH
$,&&$%
KWWSZZZDLFFFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
10
10
0D\
6HS
-DQ
7$6,
0D\
$,&&5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$UDE+ROGLQJ&R
-RUGDQLDQ,QVXUDQFH&R
$UDE6XSSO\DQG7UDGLQJ
$675$
6RXUFH7DGDZXO1&%&5HVHDUFK
139
,1685$1&(~0$<
6$8',81,7('
$/62.12:1$6:$/$¶$
(VWDEOLVKHGLQ$O.KREDULQ6DXGL8QLWHG&RRSHUDWLYH
,QVXUDQFH&RPSDQ\:DOD¶D,QVXUDQFHVSHFLDOL]HVLQ
EXVLQHVVULVNVDQGJRYHUQPHQWDJHQFLHV7KHFRPSDQ\
PDUNHWVSURGXFWVDQGVHUYLFHVXQGHUWKH:$/$$EUDQGDQG
RSHUDWHVWKURXJKLWVEUDQFKHVLQ5L\DGK-HGGDKDQG$O
.KREDU
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
:DOD¶D,QVXUDQFHRIIHUVFRRSHUDWLYHLQVXUDQFHSURGXFWVIRUSURSHUW\ILUHDQG 672&.'(7$,/6
DOOLHGULVNVPRWRUPDULQHFDUJRDQGKXOOHQJLQHHULQJPHGLFDODQG
ZHHNUDQJH+/65
PLVFHOODQHRXVDFFLGHQWVLQVXUDQFH7KHFRPSDQ\HDUQVPRVWUHYHQXHVIURP
0DUNHWFDS65PQ
WKHPRWRUPHGLFDODQGSURSHUW\LQVXUDQFHVHJPHQWV
6KDUHVRXWVWDQGLQJPQ
x )LQDQFLDOV
3ULFHSHUIRUP
,QWKHFRPSDQ\¶VQHWLQVXUDQFHSUHPLXPJUHZ<R<WR
65PQIURP65PQLQ&RQVHTXHQWO\WRWDOUHYHQXHVURVH
<R<WR65PQIURP65PQWKHSUHYLRXV\HDU7KHFRPSDQ\
SRVWHGDQHWSURILWLQFRPSDUHGWRDQHWORVVLQSULPDULO\OHGE\
EHWWHUXQGHUZULWLQJSHUIRUPDQFHDFURVVDOOOLQHVRILQVXUDQFHEXVLQHVVGXHWR
RSWLPL]DWLRQRIRSHUDWLRQDOH[SHQVHV
x 5HFHQWGHYHORSPHQWV
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
,Q1RYHPEHU:DOD¶D,QVXUDQFHDQQRXQFHGWKDWLWKDVVLJQHGDWZR
\HDUFRQWUDFWZLWK$O:DIDD,QVXUDQFH$JHQF\&RPSDQ\7KHODWWHULVDQ
LQVXUDQFHDJHQWOLFHQVHGE\6DXGL$UDELDQ0RQHWDU\$JHQF\DQGRSHUDWHV
WKURXJKVHYHUDOEUDQFKHVDQGSRLQWVRIVDOHDFURVV.6$,Q'HFHPEHU
WKHFRPSDQ\DQQRXQFHGWKHDSSRLQWPHQWRI0U-RKVRQ9DUJKHVHDV&KLHI
([HFXWLYH2IILFHU
6(
%ORRPEHUJFRGH
:$/$$$%
ZZZZDODDFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP 65PQ
65PQ
7RWDO5HYHQXHV
65PQ
1HW,QFRPH
65PQ
$VVHWV
65PQ
(TXLW\
65PQ
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV 65PQ
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
65
(36
65
%936
1$
1$
1$
1$
1$
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
)LQDQFLDOVRIIRUPRQWKV
<R<
10
10
&$*5
1$
1$
10
1$
10
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
:DODD,QVXUDQFH5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
,QWHUQDWLRQDOIRU*HQHUDO,QVXUDQFH &RPSDQ\
6RXUFH7DGDZXO1&%&5HVHDUFK
140
,1685$1&(~0$<
*8/)81,21&223(5$7,9(
$/62.12:1$6*8/)81,21
*XOI8QLRQ&RRSHUDWLYH,QVXUDQFH&RPSDQ\*XOI8QLRQZDV
HVWDEOLVKHGE\*XOI8QLRQ,QVXUDQFHDQG3URMHFWV
0DQDJHPHQW+ROGLQJ&RLQ$XJXVW7KHFRPSDQ\RIIHUV
6KDULD¶DFRPSOLDQWLQVXUDQFHSURGXFWVFDWHULQJWRFOLHQWVLQ
6DXGL$UDELDDVZHOODVFXVWRPHUVRI*XOI8QLRQ,QVXUDQFH
DQG5LVN0DQDJHPHQW&RPSDQ\
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
*XOI8QLRQLVHQJDJHGLQFRRSHUDWLYHLQVXUDQFHDQGUHLQVXUDQFHDFWLYLWLHV
672&.'(7$,/6
H[FOXGLQJSURWHFWLRQDQGVDYLQJVLQVXUDQFH7KHFRPSDQ\¶VSURGXFWSRUWIROLR ZHHNUDQJH+/65
FRPSULVHVLQVXUDQFHIRUSURSHUW\HQJLQHHULQJPDULQHOLDELOLW\PRWRU
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
LQGLYLGXDOKHDOWKDQGRWKHUUHODWHGFRRSHUDWLYHLQVXUDQFHDFWLYLWLHV$SDUW
IURP'DPPDP*XOI8QLRQRSHUDWHVEUDQFKHVLQ-HGGDK.KREDUDQG
3ULFHSHUIRUP 0
5L\DGK
$EVROXWH
x )LQDQFLDOV
*XOI8QLRQ¶VQHWLQVXUDQFHSUHPLXPIHOO<R<WR65PQLQ$V
DUHVXOWWRWDOUHYHQXHVGHFOLQHG<R<WR65PQLQFRPSDUHGWR
65PQLQ1HWFODLPVLQFXUUHGLQFUHDVHGE\65PQLQ,Q
DGGLWLRQJHQHUDODQGDGPLQLVWUDWLYHH[SHQVHVDVZHOODVEDGGHEWVSURYLVLRQ
URVH&RQVHTXHQWO\WKHFRPSDQ\LQFXUUHGDQHWORVVRI65PQLQ
FRPSDUHGWRDSURILWRI65PQ
x 5HFHQWGHYHORSPHQWV
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
*8/)81,$%
ZZZJXOIXQLRQFRPVD
,Q$SULOWKHFRPSDQ\UHFHLYHGDSSURYDOIURP6DXGL$UDELDQ0RQHWDU\
$JHQF\6$0$IRUWKHVDOHDQGPDUNHWLQJRILWV/LIH*URXS3URWHFWLRQ
,QVXUDQFHDQG3XEOLF/LDELOLW\,QVXUDQFHSURGXFWV,QWKHVDPHPRQWK*XOI
8QLRQDQQRXQFHGWKHDSSRLQWPHQWRI0U2PDU%LQ$EGXOODK$O5DVKHGDVD
PHPEHURIWKH%RDUGUHSODFLQJ0U6XODLPDQ%LQ$EGXOODK$O=DPLO,Q
1RYHPEHU*XOI8QLRQDQG6HUYLFHV&ODLPVDQG5LVNV&RPSDQ\
HQWHUHGLQWRDQDJUHHPHQWWRVHWWOHPHGLFDOFODLPVRIWKHIRUPHU¶VFOLHQWV
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ 65PQ 65PQ 65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
10
10
&$*5
10
10
0D\
6HS
7$6,
-DQ
0D\
*XOI8QLRQ5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
*XOI8QLRQ,QVXUDQFH&RPSDQ\
6RXUFH7DGDZXO1&%&5HVHDUFK
141
,1685$1&(~0$<
$5$%,$16+,(/'
$/62.12:1$6$5$%,$1
$UDELDQ6KLHOG&RRSHUDWLYH,QVXUDQFH&RPSDQ\$UDELDQ
6KLHOGKHDGTXDUWHUHGLQ5L\DGKDQGHVWDEOLVKHGLQ
FRPPHQFHGRSHUDWLRQVLQ-DQXDU\7KHFRPSDQ\D
VXEVLGLDU\RI%DKUDLQEDVHG$UDELDQ6KLHOG,QVXUDQFH
&RPSDQ\LVHQJDJHGLQFRRSHUDWLYHLQVXUDQFHDQG
UHLQVXUDQFHDFWLYLWLHV
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
$UDELDQ6KLHOGSURYLGHVJHQHUDOLQVXUDQFHSURGXFWVLQFOXGLQJPRWRUPDULQH 672&.'(7$,/6
HQJLQHHULQJSURSHUW\OLDELOLW\DLUSODQHDQGDFFLGHQWLQVXUDQFH,WDOVRRIIHUV ZHHNUDQJH+/65
PHGLFDOLQVXUDQFHWRLQGLYLGXDOVDVZHOODVFRPSDQLHV
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
x )LQDQFLDOV
$UDELDQ6KLHOG¶VQHWLQVXUDQFHSUHPLXPDFFRXQWLQJIRURIWRWDO
UHYHQXHJUHZ<R<WR65PQLQ7RWDOUHYHQXHLQFUHDVHG
<R<WR65PQ1HWLQFRPHIHOO<R<WR65PQLQ
PDLQO\GXHWRULVLQJUHVHUYHVDOORFDWHGIRUGHDWKDFFLGHQWVDQGRYHUDOO
LQFUHDVHLQQHWFODLPVLQFXUUHGWKURXJKRXWWKH\HDU
x 5HFHQWGHYHORSPHQWV
,Q$SULO$UDELDQ6KLHOGDQQRXQFHGWKDW$UDELDQ6KLHOG,QVXUDQFH
&RPSDQ\%DKUDLQDVWDNHKROGHULQWKHFRPSDQ\KDVFHDVHGLWV
RSHUDWLRQVLQ%DKUDLQ$UDELDQ6KLHOG,QVXUDQFH&RPSDQ\ZDVVXVSHQGHG
IURPZRUNLQJLQ6DXGL$UDELDVLQFH-DQXDU\DIWHUVHOOLQJLWVSRUWIROLRRI
LQVXUDQFHDQGDOODVVHWVUHODWHGWR$UDELDQ6KLHOG&RRSHUDWLYH,QVXUDQFH
6DXGL$UDELD
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6+,(/'$%
ZZZDUDELDQVKLHOGFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
)LQDQFLDOVRIIRUPRQWKV
<R<
&$*5
10
10
0D\
6HS
7$6,
-DQ
0D\
$UDELDQ6KLHOG5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$UDELDQ6KLHOG,QVXUDQFH&R
%DKUDLQ1DWLRQDO+ROGLQJ&R
<DPDPD6DXGL&HPHQW&R
$O2EDLNDQ,QYHVWPHQW*URXS
6RXUFH7DGDZXO1&%&5HVHDUFK
142
,1685$1&(~0$<
%858-&223(5$7,9(
$/62.12:1$6%858-
%XUXM&RRSHUDWLYH,QVXUDQFH&RPSDQ\%XUXMDSDUWRI
.XZDLW¶V*XOI,QVXUDQFH*URXSZDVHVWDEOLVKHGLQ2FWREHU
LQ5L\DGK)RUPHUO\NQRZQDV6DXGL3HDUO,QVXUDQFH&R
LWZDVUHHVWDEOLVKHGDV%XUXM&RRSHUDWLYH,QVXUDQFH
&RPSDQ\GXHWRUHJXODWRU\FKDQJHVLQ.6$¶VLQVXUDQFH
VHFWRU7KHFRPSDQ\ZDVOLVWHGRQWKH7$6,LQ)HEUXDU\
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
%XUXM¶VSURGXFWSRUWIROLRLQFOXGHVYDULRXVLQVXUDQFHFRYHUVVXFKDV0RWRU
3URSHUW\DQG)LUH0DULQH(QJLQHHULQJ)LGHOLW\DQG0RQH\/LDELOLW\DQG
RWKHUW\SHV7KHFRPSDQ\IROORZVUHJXODWLRQVODLGE\7KH&RRSHUDWLYH
,QVXUDQFHIRUFRRSHUDWLYHLQVXUDQFHDVZHOODVJXLGHOLQHVLVVXHGE\6DXGL
$UDELDQ0RQHWDU\$JHQF\
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
x )LQDQFLDOV
%XUXMUHSRUWHGQHWLQVXUDQFHSUHPLXPRI65PQDQGDWRWDOUHYHQXHRI
65PQLQ7KHFRPSDQ\UHSRUWHGDQHWORVVRI65PQGXULQJWKH
\HDU7KLVIDOOLQQHWORVVFRPSDUHGWRWKHVL[PRQWKSHULRGRILVPDLQO\
GXHWRWKHLQFUHDVHLQJURVVZULWWHQSUHPLXPVDQGDOVRVLQFHDOOWKHSUH
LQFRUSRUDWLRQFRVWVZHUHH[SHQVHGLQWKHILQDQFLDOVRI
0
0
0
$EVROXWH
1$ 0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
x 5HFHQWGHYHORSPHQWV
,Q0DUFKWKHFRPSDQ\UHFHLYHGILQDOVDOHVDQGPDUNHWLQJDSSURYDOIRU
LWVYHKLFOHLQVXUDQFHSURGXFWVDQGHLJKWRWKHULQVXUDQFHSURGXFWVIURP6DXGL
$UDELDQ0RQHWDU\$JHQF\6$0$,Q2FWREHUWKHFRPSDQ\UHFHLYHG
ILQDODFFUHGLWDWLRQIURPWKH&RXQFLORI&RRSHUDWLYH+HDOWK,QVXUDQFHDQG
UHFHLYHGDVL[PRQWKH[WHQVLRQRQWHPSRUDU\DSSURYDOIURP6$0$IRU
LQVXUDQFHSURGXFWV,Q$XJXVW%XUXMUHFHLYHGDSSURYDOIURP6$0$WR
VHOODQGPDUNHWKHDOWKLQVXUDQFHSURGXFWV
6(
%ORRPEHUJFRGH
%858-$%
ZZZEXUXMLQVXUDQFHFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
6+$5(35,&(3(5)250$1&(
65
65
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
&$*5
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
<R<
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
*
ILJXUHVDUHIRUPRQWKVPRQWKDEVROXWHVWRFNSULFHSHUIRUPDQFHLVQRWDYDLODEOHVLQFHWKHVWRFNGLGQRWWUDGHDWWKH
FRUUHVSRQGLQJSHULRG
0D\
6HS
7$6,
-DQ
%XUXM&RRSHUDWLYH5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
*XOI,QVXUDQFH&R.6&
<RXVHI0RKDPPHG$EGHO:DKDE
1DJK\&R
*XOI0HGLFDO&R
%DWWHUML,QGXVWULDO*URXS&R
6RXUFH7DGDZXO1&%&5HVHDUFK
143
,1685$1&(~0$<
6$1$',1685$1&(
$/62.12:1$66$1$'
6DQDG,QVXUDQFH5HLQVXUDQFH&RRSHUDWLYH&RPSDQ\
6$1$'HVWDEOLVKHGLQLVKHDGTXDUWHUHGLQ5L\DGK7KH
FRPSDQ\SURYLGHVDUDQJHRIFDUJHQHUDOKHDOWKSURSHUW\
DQGPDULQHLQVXUDQFHDVZHOODVUHLQVXUDQFHVHUYLFHV6$1$'
DOVRSODQVWRH[SDQGLWVSURGXFWSRUWIROLRWRFRYHULQVXUDQFH
IRUDJULFXOWXUHDLUOLQHVVKLSVSHWURODQGSRZHU
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
6$1$'SURYLGHVILUHWUDYHOPHGLFDOPRWRUSURSHUW\PDULQHDQG
HQJLQHHULQJLQVXUDQFHSURGXFWV7KHFRPSDQ\DOVRRIIHUVLQVXUDQFHDJDLQVW
JHQHUDODFFLGHQWV,QDGGLWLRQ6$1$'SURYLGHVOLIHLQVXUDQFHSURGXFWVDQG
UHLQVXUDQFHVHUYLFHV
672&.'(7$,/6
ZHHNUDQJH+/65
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
x )LQDQFLDOV
7KHFRPSDQ\¶VQHWLQVXUDQFHSUHPLXPIHOO<R<WR65PQLQ
7RWDOUHYHQXHVGHFUHDVHG<R<WR65PQLQGXHWRDGURSLQ
QHWLQVXUDQFHSUHPLXPZKLFKDFFRXQWVIRURIWRWDOUHYHQXHV
&RQVHTXHQWO\6$1$'¶VQHWORVVLQFUHDVHGWR65PQLQFRPSDUHGWR
65PQLQWKHSUHYLRXV\HDU
x 5HFHQWGHYHORSPHQWV
,Q-DQXDU\6$1$'DQQRXQFHGWKDW0U6XOWDQ%LQ0RKDPPHG%LQ
6DOHKKDGUHVLJQHGDVDPHPEHURIWKH%RDUGRI'LUHFWRUV2Q$XJXVW
WKHFRPSDQ\DSSRLQWHG0U3KLOLSSH:LOOLDPDV&KLHI([HFXWLYH2IILFHU
LQSODFHRI0U*UDP(IQHVZKRKDGUHVLJQHGLQ-XO\
0DUNHWFDSPQ
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6$1$'$%
ZZZVDQDGFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
)LQDQFLDOVRIIRUPRQWKV
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
6$1$'5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$O.KD]QD,QVXUDQFH&R
&RQWLQHQWDO,QVXUDQFH&R
5DPDW0DUNHWLQJDQG'LVWULEXWLRQ
/WG
6RXUFH7DGDZXO1&%&5HVHDUFK
144
,1685$1&(~0$<
:$7$1,<$,1685$1&(
$/62.12:1$6:$7$1,<$
:DWDQL\D,QVXUDQFH&RPSDQ\:DWDQL\DZDVOLVWHGRQWKH
6DXGL6WRFN([FKDQJH7DGDZXOLQ-XQH7KHFRPSDQ\
RIIHUV6KDULD¶DFRPSOLDQWQRQOLIHLQVXUDQFHDQGUHLQVXUDQFH
VHUYLFHVLQWKH.LQJGRP:DWDQL\DRSHUDWHVWKURXJKRIILFHVLQ
-HGGDK5L\DGKDQG.KREDU
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
:DWDQL\DRIIHUVDZLGHUDQJHRILQVXUDQFHVHUYLFHVLQVHJPHQWVVXFKDV
SURSHUW\PHGLFDOPDULQHDYLDWLRQHQJLQHHULQJILUHJHQHUDODFFLGHQWPRWRU 672&.'(7$,/6
DQGOLDELOLW\LQVXUDQFH7KHFRPSDQ\FDSLWDOL]HVRQLWVVWUDWHJLFSDUWQHUVKLSV ZHHNUDQJH+/65
ZLWK1HZ5H&RPSDQ\SDUWRI0XQLFK5H*URXSDQG6DXGL+ROODQGL%DQN
0DUNHWFDS65PQ
6KDUHVRXWVWDQGLQJPQ
WRVHOOLQVXUDQFHSURGXFWV
x )LQDQFLDOV
3ULFHSHUIRUP
:DWDQL\D¶VUHYHQXHVJUHZ<R<WR65PQLQIURP65PQLQ
+RZHYHUGXULQJWKHFRPSDQ\ZDVRSHUDWLRQDORQO\IURP$SULOWR
'HFHPEHU5HYHQXHVIRUWRWDOHG65PQFRPSDUHGWR65PQIRU
WKHQLQHPRQWKVLQ6LJQLILFDQWJURZWKLQUHYHQXHVUHVXOWHGLQDQHW
LQFRPHRI65PQLQFRPSDUHGWRDQHWORVVRI65PQWKHSUHYLRXV
\HDU)RUWKHPRQWKVIURP$SULOWR'HFHPEHUWKHFRPSDQ\
UHFRUGHGSUHFRUSRUDWLRQH[SHQVHVRI65PQDQGSURYLVLRQVRI
65PQDORQJZLWKXQUHSRUWHGFODLPVRI65PQ
x 5HFHQWGHYHORSPHQWV
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
:$7$1$%
ZZZZDWDQL\DFRPVD
,Q)HEUXDU\:DWDQL\DUHFHLYHGDQDSSURYDOIURP6DXGL$UDELDQ
0RQHWDU\$JHQF\6$0$IRULWV*URXS3HUVRQDO$FFLGHQW,QVXUDQFHDQG
,QGLYLGXDO7HUP/LIH,QVXUDQFHSURGXFWV,Q-DQXDU\6WDQGDUGDQG3RRU
V
DIILUPHGWKHFRPSDQ\
VILQDQFLDOVWUHQJWKZLWKDFUHGLWUDWLQJRI%%%'XULQJ
WKHVDPHPRQWK:DWDQL\DDSSRLQWHG0U,EUDKLP$O+XVVHLQDVWHPSRUDU\
&KLHI([HFXWLYH2IILFHUWKHFRPSDQ\DOVRDQQRXQFHGWKDWLWKDVHDUQHGD
FRQWUDFWZRUWK65PQIURP6DXGL&HPHQW&RPSDQ\WRSURYLGHLQVXUDQFH
FRYHUDJHWRWKHODWWHU¶VDVVHWVDQGSURSHUW\IRURQH\HDU,Q'HFHPEHU
6$0$DSSURYHGWKHFRPSDQ\¶V,QGLYLGXDO3HUVRQDO$FFLGHQW,QVXUDQFH
SURGXFW
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP 65PQ
65PQ
7RWDO5HYHQXHV
65PQ
1HW,QFRPH
65PQ
$VVHWV
65PQ
(TXLW\
65PQ
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV 65PQ
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
UHYHQXHVDUHIRUQLQHPRQWKV$SULOWR'HFHPEHU
1$
1$
<R<
10
10
&$*5
0D\
6HS
7$6,
-DQ
0D\
:DWDQL\D5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
6DXGL1DWLRQDO,QVXUDQFH&R
6DXGL+ROODQGL%DQN
1HZ5HLQVXUDQFH&R/WG
,EUDKLP$O-XIIDOL%URV&R
6RXUFH7DGDZXO1&%&5HVHDUFK
145
,1685$1&(~0$<
$&($5$%,$
$/62.12:1$6$&(
+HDGTXDUWHUHGLQ$O.KREDU$&($UDELD&RRSHUDWLYH
,QVXUDQFH&RPSDQ\$&(LVDMRLQWYHQWXUHEHWZHHQ$&(
/LPLWHGDQG(O.KHUHLML*URXS7KHFRPSDQ\ZDVHVWDEOLVKHG
LQDQGUHFHLYHGUHJXODWRU\DSSURYDOIURP6DXGL$UDELDQ
0RQHWDU\$JHQF\6$0$WRFRPPHQFHRSHUDWLRQVLQ-DQXDU\
$&(RSHUDWHVLQ6DXGL$UDELDWKURXJKLWVRIILFHVLQ$O
.KREDU5L\DGK-HGGDKDQG$O+DVVD
x %XVLQHVVEULHI
$&(RIIHUVLQVXUDQFHSURGXFWVLQWKHSURSHUW\FDVXDOW\ILQDQFLDOSHUVRQDO
DQGKHDOWKVHJPHQWVWRDGLYHUVHUDQJHRIFOLHQWVLQ6DXGL$UDELD,WSURYLGHV
DQDUUD\RIFXVWRPL]HGLQVXUDQFHSURGXFWVLQFOXGLQJKHDOWKILUHDQG
SURSHUW\HQJLQHHULQJDFFLGHQWVOLDELOLW\FDUPDULQHDYLDWLRQHQHUJ\DQG
FROOHFWLYHLQVXUDQFH
x )LQDQFLDOV
,Q$&(¶VQHWLQVXUDQFHSUHPLXPVWRRGDW65PQFRPSDUHGWR
65PQIRUDQPRQWKSHULRGHQGLQJ'HFHPEHU7KHFRPSDQ\
UHSRUWHGWRWDOUHYHQXHVRI65PQDQGQHWLQFRPHRI65PQLQ
6WDWHPHQWVIRUWKH\HDUUHIOHFWWKHSXUFKDVHDQGWUDQVIHURIWKH
LQVXUDQFHSRUWIROLRUHODWHGWR$&($UDELD,QVXUDQFH&RPSDQ\DQG
,QWHUQDWLRQDO,QVXUDQFH&RPSDQ\
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
65
86
$YJGDLO\WXUQRYHUPQ
x 5HFHQWGHYHORSPHQWV
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$&($%
ZZZDFHPHQDFRP
,Q0DUFK6$0$H[WHQGHGLWVWHPSRUDU\DSSURYDOIRUWKHFRPSDQ\¶V
LQVXUDQFHSURGXFWVIRUDSHULRGRIVL[PRQWKV,Q-DQXDU\$&(
REWDLQHG6$0$DSSURYDOWRPDUNHWDQGVHOOLWV&RPSUHKHQVLYH*HQHUDO
/LDELOLW\,QVXUDQFH3ROLF\,QWKHVDPHPRQWKWKHFRPSDQ\UHFHLYHG6$0$¶V
FRQVHQWWRWUDQVIHUSRUWIROLRVRI$&($UDELD,QVXUDQFH&RPSDQ\%6&DQG
,QWHUQDWLRQDO,QVXUDQFH&RPSDQ\(&WR$&($UDELD&RRSHUDWLYH
,QVXUDQFH&RPSDQ\ZLWKHIIHFWIURP-DQXDU\WKLVZRXOGUHIOHFWLQ
$&(¶VILQDQFLDOVWDWHPHQWV,Q2FWREHUWKHFRPSDQ\UHFHLYHG
6$0$¶VSHUPLVVLRQWRH[WHQGWKHWHPSRUDU\DSSURYDORILWVLQVXUDQFH
SURGXFWVIRUVL[PRQWKV
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
QXPEHUVDUHIRUWKHSHULRGRIPRQWKVVWDUWLQJ-XO\WR'HFHPEHU
<R<
10
10
10
&$*5
10
115.6
0D\
24.8
(9.6)
10
6HS
7$6,
-DQ
0D\
$FH$UDELD5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$6,1$,QWHUQDWLRQDO+ROGLQJ
*HQHUDO&RPSDQ\IRU
7HFKQRORJLFDO'HYHORSPHQW
:HKGDQ,QYHVWPHQW
*HQHUDO&RPSDQ\IRU,QYHVWPHQW 0LGGOH(DVW,QYHVWPHQW
6RXUFH7DGDZXO1&%&5HVHDUFK
146
,1685$1&(~0$<
$//,$1=6$8',)5$16,
$/62.12:1$6$//,$1=6)$//,$1=6$8',)5$16,
6DXGL)UDQVL&RRSHUDWLYH,QVXUDQFH&RPSDQ\$OOLDQ]6)
ZDVHVWDEOLVKHGLQLQ5L\DGK7KHFRPSDQ\LVD
VXEVLGLDU\RI%DQTXH6DXGL)UDQVLDQG$VVXUDQFHV*HQHUDOHV
GH)UDQFHPHPEHURIWKH$OOLDQ]*URXS
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
$OOLDQ]6)RIIHUVPXOWLSOHLQVXUDQFHVROXWLRQVWKURXJKWZRPDLQVHJPHQWV
LQGLYLGXDODQGFRUSRUDWH8QGHUWKHLQGLYLGXDOVROXWLRQVVHJPHQWWKH
FRPSDQ\SURYLGHV6KDULD¶DFRPSOLDQWLQVXUDQFHSURGXFWVLQFOXGLQJLQGLYLGXDO 672&.'(7$,/6
ILQDQFLDOSODQQLQJIRUHGXFDWLRQSURWHFWLRQDQGUHWLUHPHQWIDPLO\LQFRPH
ZHHNUDQJH+/65
SURWHFWLRQOLIHDQGGLVDELOLW\LQVXUDQFHDQGFRUSRUDWHVROXWLRQVDVVXUDQFH
0DUNHWFDSPQ
7KHFRUSRUDWHVROXWLRQVGLYLVLRQRIIHUVILUHJHQHUDODFFLGHQW
6KDUHVRXWVWDQGLQJPQ
FRQVWUXFWLRQHQJLQHHULQJPDULQHFDUJRDYLDWLRQDQGHPSOR\HH
3ULFHSHUIRUP 0
FRPSHQVDWLRQLQVXUDQFHSURGXFWV
$EVROXWH
x )LQDQFLDOV
$IWHUSRVWLQJQHWORVVIRUIRXU\HDUV$OOLDQ]6)UHFRUGHGQHWSURILWRI65PQ
LQ7KLVFDQEHPDLQO\DWWULEXWDEOHWRDQLQFUHDVHLQJURVVDQGQHW
LQVXUDQFHSUHPLXPV1HWLQVXUDQFHSUHPLXPZKLFKDFFRXQWHGIRURI
WRWDOUHYHQXHLQURVH<R<$VDUHVXOWWKHFRPSDQ\¶VWRWDO
UHYHQXHJUHZWR65PQLQ,WVFRPELQHGUDWLRGHFOLQHG
VOLJKWO\WRLQIURPLQ
x 5HFHQWGHYHORSPHQWV
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$//,$1=$%
ZZZDOOLDQ]VIFRP
,Q$SULO$OOLDQ]6)UHFHLYHGDSSURYDOIURP6DXGL$UDELDQ0RQHWDU\
$JHQF\6$0$IRU&LYLODQG3URGXFWLQVXUDQFHSURGXFWDQGEDQNLQJ
UHODWHGLQVXUDQFHSURGXFWVHIIHFWLYHIURP-DQXDU\,Q'HFHPEHU
WKHFRPSDQ\DQQRXQFHGWKHPHUJHURILWVIRXQGLQJVKDUHKROGHU$OOLDQ]
)UDQFH$*),QWHUQDWLRQDOZLWK$OOLDQ])UDQFH,QWKHSURFHVVRIWKHPHUJHU
DOODVVHWVRI$OOLDQ])UDQFH$*),QWHUQDWLRQDOZRXOGEHWUDQVIHUUHGWR
$OOLDQ])UDQFH'XULQJWKHVDPHPRQWK$OOLDQ]6)REWDLQHGILQDODSSURYDO
IURP6$0$IRU³:RUNHUV
FRPSHQVDWLRQLQVXUDQFH´SURGXFW7KHFRPSDQ\
DOVRUHFHLYHG6$0$¶VH[WHQVLRQRISURYLVLRQDODSSURYDOIRULQVXUDQFH
SURGXFWVIRUDSHULRGRIVL[PRQWKV
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
3([
10
10
$
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
)LQDQFLDOVRIIRU0RQWKV
<R<
10
&$*5
10
10
0D\ 6HS
7$6,
-DQ
0D\
$//,$1=6)5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
%DQTXH6DXGL)UDQVL
$*),QWHUQDWLRQDO&R
61,+ROGLQJ&R
6RXUFH7DGDZXO1&%&5HVHDUFK
147
,1685$1&(~0$<
6$8',,$,&
$/62.12:1$66$8',6$/$0$
(VWDEOLVKHGLQLQDFFRUGDQFHZLWKD5R\DO'HFUHH6DXGL
,$,&&RRSHUDWLYH,QVXUDQFH&RPSDQ\6DODPDLVD-HGGDK
EDVHGLQVXUDQFHFRPSDQ\7KHFRPSDQ\PDUNHWVLQVXUDQFH
SURGXFWVXQGHUWKH6$/$0$EUDQG6$/$0$DVXEVLGLDU\RI
8$(EDVHG,VODPLF$UDE,QVXUDQFH&RSURYLGHV6KDULD¶D
FRPSOLDQWJHQHUDOLQVXUDQFHVROXWLRQV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
6$/$0$¶VSURGXFWVDUHEURDGO\FODVVLILHGLQWRWKUHHVHJPHQWVKHDOWKPRWRU 672&.'(7$,/6
DQGJHQHUDOLQVXUDQFH7KHKHDOWKLQVXUDQFHVHJPHQWRIIHUVLQGLYLGXDODQG
ZHHNUDQJH+/65
FRUSRUDWHKHDOWKFDUHFRYHU0RWRULQVXUDQFHSURYLGHVFRPSUHKHQVLYHDQG
0DUNHWFDS65PQ
WKLUGSDUW\OLDELOLW\LQVXUDQFHFRYHU7KHJHQHUDOLQVXUDQFHGLYLVLRQRIIHUV
6KDUHVRXWVWDQGLQJPQ
FRYHUIRUILUHSURSHUW\SHUVRQDODFFLGHQWPDULQHHQJLQHHULQJDYLDWLRQDQG
PLVFHOODQHRXVLQVXUDQFH
3ULFHSHUIRUP 0
$EVROXWH
x )LQDQFLDOV
6$/$0$¶VQHWLQVXUDQFHSUHPLXPGHFOLQHGWR65PQLQ
GHVSLWHDLQFUHDVHLQJURVVZULWWHQSUHPLXPV*:3WR65PQLQ
FRPSDUHGWR65PQLQ7KHFRPSDQ\¶VWRWDOUHYHQXHIHOO
<R<LQ,WVQHWLQFRPHDOVRGHFOLQHG<R<GXHWRDQLQFUHDVHLQ
SURYLVLRQIRUXQHDUQHGSUHPLXP&RQVHTXHQWO\6$/$0$¶V52(IHOOWR
IURPLQ
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
6$/$0$$%
ZZZVDODPDFRPVD
,Q$SULO6$/$0$WHUPLQDWHGWZR\HDUVDOHVDJUHHPHQWZLWK$O
0D\D]HHQ,QVXUDQFH$JHQF\WRVHOOPHGLFDOLQVXUDQFHDQGFLYLOOLDELOLW\
LQVXUDQFH,Q-DQXDU\WKHFRPSDQ\UHFHLYHGILQDODSSURYDOIURP6DXGL
$UDELDQ0RQHWDU\$JHQF\6$0$IRU/RVVRI3URILWIROORZLQJ0DFKLQHU\
%UHDNGRZQ7KLVLQFUHDVHGLWVWRWDOILQDODSSURYHGSURGXFWVWR,Q
1RYHPEHU6WDQGDUG3RRU¶VUDLVHGFRXQWHUSDUW\FUHGLWDQGLQVXUHU
ILQDQFLDOVWUHQJWKUDWLQJVRQ6$/$0$WR
$
IURP
%%%
,Q6HSWHPEHU
WKHFRPSDQ\REWDLQHG6$0$¶VDSSURYDOWRRSHQSRLQWRIVDOHGLVWULEXWLRQ
FHQWHUVDFURVV.6$
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP 65PQ
65PQ
7RWDO5HYHQXHV
65PQ
1HW,QFRPH
65PQ
$VVHWV
65PQ
(TXLW\
65PQ
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV 65PQ
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65
65
1$
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
)LQDQFLDOV RI IRU PRQWKV
1$
1$
1$
<R< &$*5
10
10
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
6$/$0$5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$UDE,VODPLF,QVXUDQFH&RPSDQ\
%LQ'DZRRG6RQV&RPPHUFLDO
&R
$O6KD
HU7UDGH,QGXVWULHVDQG
&RQVWUXFWLRQ
&RRSHUDWLYH*URXS&RPSDQ\IRU
7UDGH&RQVWUXFWLRQ
6RXUFH7DGDZXO1&%&5HVHDUFK
148
,1685$1&(~0$<
$/$+/,$,1685$1&(
$/62.12:1$6$/$+/,$
$O$KOLD,QVXUDQFH&RPSDQ\$O$KOLDZDVHVWDEOLVKHGE\WKH
1DWLRQDO,QVXUDQFH&RPSDQ\RI(J\SWDQGVHYHUDO6DXGL
LQYHVWRUVLQ+HDGTXDUWHUHGLQ5L\DGKWKHFRPSDQ\
RIIHUV6KDULD¶DFRPSOLDQWFRRSHUDWLYHLQVXUDQFHDQG
UHLQVXUDQFHVHUYLFHVLQWKH.LQJGRP
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
$O$KOLDRIIHUVDUDQJHRIJHQHUDOLQVXUDQFHSURGXFWVLQFOXGLQJILUH
LQVXUDQFHSURSHUW\LQVXUDQFHPDULQHLQVXUDQFHPRWRULQVXUDQFHPRQH\
LQVXUDQFHHQJLQHHULQJLQVXUDQFHPHGLFDOLQVXUDQFHPHGLFDOPDOSUDFWLFH
LQVXUDQFHILGHOLW\LQVXUDQFHDQGOLDELOLW\LQVXUDQFH
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
x )LQDQFLDOV
$O$KOLD¶VQHWLQVXUDQFHSUHPLXPZKLFKFRQWULEXWHVWRWRWDOUHYHQXHV
LQFUHDVHG<R<WR65PQLQ7RWDOUHYHQXHVJUHZ<R<WR
65PQFRPSDUHGWR65PQLQ1HWLQFRPHORVVHVGHFUHDVHGWR
65PQLQIURP65PQLQKRZHYHUFRPELQHGUDWLRLQFUHDVHG
IURPWRDVRSHUDWLQJH[SHQVHVJUHZ
x 5HFHQWGHYHORSPHQWV
,Q0DUFK$O$KOLDDQQRXQFHGWKDW6DXGL$UDELDQ0RQHWDU\$JHQF\
6$0$KDVH[WHQGHGLWVDSSURYDOIRUYHKLFOHLQVXUDQFHSURGXFWVIRUDSHULRG
RIWKUHHPRQWKVXQWLO-XQHDQGWKHJURXSPHGLFDOLQVXUDQFH
SURGXFWIRUHLJKWPRQWKVXQWLO2FWREHU,Q-DQXDU\WKH
FRPSDQ\REWDLQHGDUHQHZDOSHUPLWIURP6$0$WRFRQWLQXHLQVXUDQFH
EXVLQHVVIRUDSHULRGRIWKUHH\HDUVIRULWVJHQHUDODQGKHDOWKLQVXUDQFH
VHJPHQWV,Q'HFHPEHUWKHFRPSDQ\UHFHLYHGDSSURYDOIURP6$0$WR
VWDUWVL[QHZEUDQFKHVLQ5L\DGK4DVVLP-HGGDK$O0DGLQDK7DLIDQG$O
.KREDU,QWKHVDPHPRQWK$O$KOLDUHFHLYHG6$0$¶VFRQVHQWRQLQFUHDVLQJ
FDSLWDOEDVHWR65PQE\ZD\RIULJKWVLVVXH,Q2FWREHUWKH
FRPSDQ\UHFHLYHGDQH[WHQVLRQRISURYLVLRQDODSSURYDOIRULQVXUDQFH
SURGXFWVIRUDSHULRGRIVL[PRQWKV
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$/$+/,$$%
ZZZDODKOLDFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
3([
10
10
$
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
10
<R<
&$*5
10
10
10
0D\
6HS
7$6,
-DQ
0D\
$O$KOLD5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$O$KOLD,QVXUDQFH&R(J\SW
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
)LQDQFLDOVUHSRUWHGIRULVIRUPRQWKV
6RXUFH7DGDZXO1&%&5HVHDUFK
149
,1685$1&(~0$<
$//,('&223(5$7,9(
$/62.12:1$6$&,*6$8',$&,*
$OOLHG&RRSHUDWLYH,QVXUDQFH*URXS$&,*ZDVLQFRUSRUDWHG
LQWKURXJKWKHDFTXLVLWLRQRIWKH6DXGL$UDELDQDVVHWV
DQGFOLHQWSRUWIROLRRILWVSDUHQWFRPSDQ\$&,*%DKUDLQ
%DVHGLQ-HGGDK$&,*RIIHUV6KDULD¶DFRPSOLDQWLQVXUDQFH
DQGUHLQVXUDQFHSURGXFWVLQ6DXGL$UDELD
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
$&,*RIIHUV,VODPLFJHQHUDOLQVXUDQFHSURGXFWVLQFOXGLQJPDULQHPHGLFDO
PRWRUDFFLGHQWDQGHQJLQHHULQJLQVXUDQFH7KHFRPSDQ\SURYLGHVPDULQH
FDUJRDQGLQODQGWUDQVLWLQVXUDQFHVWKURXJKWKH0DULQH,QVXUDQFHVHJPHQW
7KH0RWRU,QVXUDQFHGLYLVLRQRIIHUVWKLUGSDUW\OLDELOLW\SURWHFWLRQSHUVRQDO
DFFLGHQWFRYHUIRUGULYHUVDQGSDVVHQJHUVDQGFRPSUHKHQVLYHµRZQ
GDPDJH¶RSWLRQV7KH*HQHUDO,QVXUDQFHVHJPHQWSURYLGHVPRQH\ILGHOLW\
SHUVRQDODFFLGHQWSXEOLFOLDELOLW\ZRUNPHQ¶VFRPSHQVDWLRQDQGPHGLFDO
PDOSUDFWLFHLQVXUDQFH
x )LQDQFLDOV
$&,*¶VQHWLQVXUDQFHSUHPLXPJUHZRYHU<R<WR65PQLQ
&RQVHTXHQWO\WKHFRPSDQ\¶VWRWDOUHYHQXHLQFUHDVHG<R<WR
65PQ1HWORVVLQFXUUHGGHFOLQHGWR65PQIURP65PQLQGXH
WRDULVHLQWRWDOLQVXUDQFHUHYHQXHDQGVWDEOHJHQHUDODGPLQLVWUDWLYH
H[SHQVHVZKLFKUHGXFHGFRPELQHGUDWLRWRIURP
x 5HFHQWGHYHORSPHQWV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$&,*$%
ZZZDFLJFRPVD
,Q$SULO$&,*UHFHLYHGDSSURYDOIURP6DXGL$UDELDQ0RQHWDU\$JHQF\
6$0$WRUHQHZLWV*HQHUDODQG+HDOWKLQVXUDQFHOLFHQVHVIRUDSHULRGRI
WKUHHPRQWKV,Q-DQXDU\WKHFRPSDQ\REWDLQHGDSSURYDOIURPWKH
&RXQFLORI&RRSHUDWLYH+HDOWK,QVXUDQFHWRUHQHZLWVLQVXUDQFHOLFHQVHIRUD
WKUHH\HDUSHULRG'XULQJWKHVDPHPRQWK$&,*UHFHLYHG6$0$¶VH[WHQVLRQ
RISURYLVLRQDODSSURYDOWRPDUNHWLQVXUDQFHSURGXFWVIRUDSHULRGRIVL[
PRQWKVDQGVLJQHGDRQH\HDUUHQHZDEOHFRQWUDFWZLWK5RZDG,QVXUDQFH
$JHQF\WRPDUNHWDQGVHOOWKHFRPSDQ\
VLQVXUDQFHSURGXFWVLQ6DXGL$UDELD
,Q6HSWHPEHU$&,*UHFHLYHG6$0$¶VFRQVHQWWRRIIHUWUDYHOLQVXUDQFH
IRUDSHULRGRIVL[PRQWKV
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
3([
10
10
$
10
3%[
36[
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK6WRFNQRWWUDGLQJVLQFH
<R<
&$*5
0D\ $XJ 1RY )HE
7$6,
$&,*5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$OOLHG&RRSHUDWLYH,QVXUDQFH*URXS ,VODPLF'HYHORSPHQW%DQN
6RXUFH7DGDZXO1&%&5HVHDUFK
150
,1685$1&(~0$<
6$8',$5$%,$1
$/62.12:1$66$,&26$8',
(VWDEOLVKHGLQ6DXGL$UDELDQ&RRSHUDWLYH,QVXUDQFH
&RPSDQ\6$,&2RIIHUV6KDULD¶DFRPSOLDQWLQVXUDQFH
VHUYLFHVDFURVV6DXGL$UDELD6$,&2LVDVXEVLGLDU\RI
%DKUDLQEDVHG6DXGL$UDELDQ&RRSHUDWLYH,QVXUDQFH
&RPSDQ\ZKLFKKROGVVWDNHLQWKHFRPSDQ\
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
6$,&2SURYLGHVLQVXUDQFHVHUYLFHVLQWZRFDWHJRULHVEXVLQHVVDQG
SHUVRQDO8QGHUEXVLQHVVLQVXUDQFHWKHFRPSDQ\FRYHUVOLDELOLWLHVVXFKDV
672&.'(7$,/6
ILUHDQGSURSHUW\PDULQHFDUJRHQJLQHHULQJDYLDWLRQPRWRUYHKLFOHHQHUJ\ ZHHNUDQJH+/65
OLIHDQGKHDOWK3HUVRQDOLQVXUDQFHSURYLGHVLQVXUDQFHIRUKRPHFDUERDW
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
OLIHKHDOWKDQGDFFLGHQWV
x )LQDQFLDOV
3ULFHSHUIRUP
6$,&2¶VQHWLQVXUDQFHSUHPLXPZKLFKFRQWULEXWHGRIWRWDOUHYHQXHV
LQFUHDVHG<R<WR65PQLQ&RQVHTXHQWO\WRWDOUHYHQXHV
JUHZRYHU<R<WR65PQ7KHFRPSDQ\LQFXUUHGDQHWORVVRI
65PQGXULQJWKH\HDUORZHUWKDQQHWORVVLQ65PQPDLQO\
GXHWRDULVHLQWKHQHWSUHPLXPDQGFRPPLVVLRQLQFRPHHDUQHGGXULQJWKH
\HDU
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
x 5HFHQWGHYHORSPHQWV
6$,&2UHFHLYHG6DXGL$UDELDQ0RQHWDU\$JHQF\¶V6$0$DSSURYDOWRVHOO
LWVPHGLFDOPDOSUDFWLFHVSURGXFWLQ$SULOPRWRULQVXUDQFHSURGXFWLQ
0DUFKLQVXUDQFHSURGXFWIRUEDQNLQJRSHUDWLRQVLQ-DQXDU\DQG
JODVVLQVXUDQFHSURGXFWLQ'HFHPEHU7KHFRPSDQ\DOVRUHFHLYHG
6$0$¶VDSSURYDOLQ'HFHPEHUWRUHQHZSURYLVLRQDODSSURYDOIRULWV
LQVXUDQFHSURGXFWV
6(
%ORRPEHUJFRGH
6$,&2$%
ZZZVDLFRFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
1$
1$
1$
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
)LQDQFLDOVRIIRUPRQWKV
<R<
&$*5
10
10
10
10
0D\
6HS
7$6,
-DQ
0D\
6$,&25+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
6DXGL$UDE,QVXUDQFH&R
6RXUFH7DGDZXO1&%&5HVHDUFK
151
,1685$1&(~0$<
6$8',,1',$1
$/62.12:1$66,&&,6$8',,1',$1
,Q6DXGL,QGLDQ&RPSDQ\IRU&RRSHUDWLYH,QVXUDQFH
6DXGL,QGLDQZDVHVWDEOLVKHGWKURXJKDMRLQWYHQWXUH
EHWZHHQ1HZ,QGLD$VVXUDQFH&R/LIH,QVXUDQFH&RUSRUDWLRQ
RI,QGLD,QWODQG)DZD]$EGXOD]L]$O+RNDLUDQG&R
+HDGTXDUWHUHGLQ5L\DGKWKHFRPSDQ\SURYLGHVOLIHDQG
JHQHUDOLQVXUDQFHVHUYLFHVWRLQGLYLGXDOVDQGFRPPHUFLDO
HVWDEOLVKPHQWV
x %XVLQHVVEULHI
6DXGL,QGLDQ¶VSURGXFWSURILOHLVVHJUHJDWHGLQWRWZREURDGFDWHJRULHVOLIH
LQVXUDQFHDQGQRQOLIHLQVXUDQFH7KHFRPSDQ\RIIHUVYDULRXVSURGXFWV
UHODWHGWRSURWHFWLRQDQGVDYLQJVVXFKDV7DNDIXO,QVXUDQFH3DUWLFLSDWLQJ
(QGRZPHQW&DVK%DFN0RQH\%DFN3URWHFW/LIHORQJDQG&KLOG%HQHILW
SODQVWKURXJKWKHOLIHLQVXUDQFHVHJPHQW8QGHUWKHQRQOLIHLQVXUDQFH
VHJPHQW6DXGL,QGLDQSURYLGHVLQVXUDQFHIRUILUHPRWRUHQJLQHHULQJKHDOWK
DQGRWKHUPLVFHOODQHRXVSURGXFWVLQFOXGLQJSHUVRQDODFFLGHQWEXUJODU\
PRQH\DQGILGHOLW\JXDUDQWHH
x )LQDQFLDOV
6,&&,¶VQHWLQVXUDQFHSUHPLXPURVH<R<WR65PQLQ
&RQVHTXHQWO\WKHFRPSDQ\¶VWRWDOUHYHQXHVJUHZ<R<WR65PQLQ
7KHFRPSDQ\¶VQHWORVVDOVRGHFOLQHGWR65PQLQFRPSDUHGWR
65PQLQPDLQO\GXHWRDIDOOLQJHQHUDODQGDGPLQLVWUDWLYH
H[SHQVHVRIVKDUHKROGHUVDQGDUHYHUVDORI65PQLQWKH'LUHFWRU¶V
UHPXQHUDWLRQLQ
x 5HFHQWGHYHORSPHQWV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6,1',$1$%
ZZZVLFFLNVDFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
,Q$SULOWKHFRPSDQ\DQQRXQFHGWKHDSSRLQWPHQWRI0U6
5DPDEKDGUDQDVDUHSUHVHQWDWLYHRI1HZ,QGLD$VVXUDQFH&RPSDQ\/WG
UHSODFLQJ0U$56HNDU,Q)HEUXDU\WKHFRPSDQ\UHFHLYHG6DXGL
$UDELDQ0RQHWDU\$JHQF\¶VDSSURYDOWRFKDQJHLWVQDPHIURP6DXGL,QGLDQ
&RPSDQ\IRU&RRSHUDWLYH,QVXUDQFHWR:$)$IRU,QVXUDQFH6DXGL,QGLDQ
&RPSDQ\IRU&RRSHUDWLYH,QVXUDQFH
9$/8$7,2108/7,3/(6
$
$
3([
10
10
$
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
6DXGL,QGLDQ5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
1HZ,QGLD,QVXUDQFH&R
/LIH,QVXUDQFH&RUSRI,QGLD
/LIH,QVXUDQFH&RUS,QW¶O
.KDOHG$EGXOD]L]%LQ6DOPDK
7UDGLQJ(VWDEOLVKPHQW
6DOHK6DDG$O.KDULML(VWDEOLVKPHQW 6RXUFH7DGDZXO1&%&5HVHDUFK
152
,1685$1&(~0$<
6$8',(1$<$
$/62.12:1$6(1$<$
6DXGL(QD\D&RRSHUDWLYH,QVXUDQFH&RPSDQ\ ZDVHVWDEOLVKHG
DVDVSHFLDOL]HGKHDOWKLQVXUDQFHFRPSDQ\LQ-XQHE\
.KDOHG-XIIDOL&RPSDQ\DQGDUHQRZQHG*HUPDQSDUWQHU
QDPHO\0XQLFK5H0XQLFK+HDOWK7KHFRPSDQ\ZDVOLVWHG
RQWKH6DXGL$UDELDQ6WRFN([FKDQJH7DGDZXOLQ)HEUXDU\
ZLWKDSDLGXSFDSLWDORI6$5PLOOLRQ
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
6DXGL(QD\DLVIRFXVHGRQEHLQJDKHDOWKFDUHVSHFLDOLVWE\RIIHULQJSULYDWH
PHGLFDOLQVXUDQFHZLWKDIIRUGDEOHTXDOLW\VHUYLFHVDQGVROXWLRQVIRUJURXSDV
ZHOODVLQGLYLGXDOKHDOWKULVNV6DXGL(QD\DDOVRSURYLGHV&RXQFLORI
&RRSHUDWLYH+HDOWK,QVXUDQFHFRPSOLDQWSURGXFWVZLWKYDU\LQJOHYHOVRI
FRYHUDJHDQGDKLJKOHYHORIVHUYLFHVDQGLQQRYDWLRQVFRYHULQJLQVXUHG
PHPEHUV,WDLPVWRHVWDEOLVKEUDQFKHVDFURVVDOOPDMRUUHJLRQVLQWKH
.LQJGRPRI6DXGL$UDELDDVZHOODVRXWVLGH
x )LQDQFLDOV
7KHFRPSDQ\ZDVOLVWHGLQ)HEUXDU\ZLWKDSDLGXSFDSLWDORI
65PQ
x 5HFHQWGHYHORSPHQWV
7KHFRPSDQ\UHFHLYHGDSSURYDOIURP6DXGL$UDELD
V&DSLWDO0DUNHW$XWKRULW\
&0$IRULWVLQLWLDOSXEOLFRIIHULQJRIPLOOLRQVKDUHVZKLFKUHSUHVHQWV
RIWKHFRPSDQ\
VVKDUHFDSLWDODWDQRIIHUSULFHRI65SHUVKDUH7KH
VXEVFULSWLRQSHULRGZDVIURP'HFHPEHUWR'HFHPEHU7KH
FRPSDQ\ZDVKHQFHOLVWHGZLWKLQWKHLQVXUDQFHVHFWRUZLWKWKHWLFNHURQ
)HEUXDU\
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
(1$<$$%
ZZZVDXGLHQD\DFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
1HW,QV3UHPLXP
7RWDO5HYHQXHV
1HW,QFRPH
$VVHWV
(TXLW\
,QYHVWPHQWV
7HFKQLFDO5HVHUYHV
&RPELQHG5DWLR
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
)HE
0DU
7$6,
$SU
$SU
0D\
(1$<$5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
0XQLFK5H
1DWLRQDO&RPSDQ\IRU+HDOWK
,QVXUDQFH
0RKDPPHGDQG:DOLG$KPHG
1DJKL
.KDOLG$KPHG-XIIDOL
6RXUFH7DGDZXO1&%&5HVHDUFK
153
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Multi-Investment
Ticker
Company
Page No.
4280
Kingdom Holding
157
4080
Assir
158
2190
SISCO
159
2030
SARCO
160
2140
Al Ahsa for Dev.
161
2120
Saudi Advanced
162
4130
Al Baha
163
0$<
08/7,,19(670(17
*OREDOXQFHUWDLQW\KLQGHUVLQYHVWPHQWDFWLYLW\
.6$¶VPXOWLLQYHVWPHQWVHFWRUFRPSULVHVGLYHUVLILHGKROGLQJJURXSV
ZLWKLQYHVWPHQWVLQDZLGHUDQJHRIVHFWRUVLQFOXGLQJKRVSLWDOLW\
UHDOHVWDWHPDQXIDFWXULQJHQHUJ\LQIUDVWUXFWXUHDQGHGXFDWLRQ
7KHVHFWRUZLWQHVVHGVLJQLILFDQWO\ORZDFWLYLW\LQ.LQJGRP
+ROGLQJ&RPSDQ\.LQJGRPUHPDLQVLWVODUJHVWSOD\HUDFFRXQWLQJ
IRUDERXWRIWRWDOVHFWRUUHYHQXHLQ
6DXGL$UDELD¶VPXOWLLQYHVWPHQWVHFWRUFRPSULVHVVHYHQOLVWHGSOD\HUVZKLFK
WRJHWKHUDFFRXQWHGIRURIWKHWRWDO*&&UHYHQXHLQ
Exhibit 96: Revenue of GCC multi-investment,
2009±11
Exhibit 97: Comparison of ROE and P/E of GCC
companies, 2011
86'PQ
.XZDLW
4DWDU
52(
3([
.6$
.6$5+6
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
5HYHQXHLQ.XZDLWDQG4DWDUWRWDOHG86'PQDQG86'PQUHVSHFWLYHO\LQ
4DWDU
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
6L]HRIWKHEXEEOHUHSUHVHQWVPDUNHWFDSDVRQ0DUFK
.LQJGRPUHPDLQVWKHVLQJOHODUJHVWFRPSDQ\LQ.6$¶VPXOWLLQYHVWPHQWVHFWRU
ZLWKDZHLJKWRILQWKHRYHUDOOPDUNHWLQGH[XSESV<R<
Exhibit 98: Sector details
8QLWVDVVWDWHG
Country
.LQJGRP+ROGLQJ&R.,1*'20
$VHHU7UDGLQJ7RXULVP0IJ$JUL5HDO(VWDWH
DQG&RQWUDFWLQJ&RPSDQ\$770&2
6DXGL$UDELDQ5HILQHULHV&R6$5&2
$O$KVD'HYHORSPHQW&R$$'&
6DXGL,QGXVWULDO6HUYLFHV&R6,6&2
6DXGL$GYDQFHG,QGXVWULHV&R6$,&
$O%DKDIRU'HYHORSPHQW,QYHVWPHQW&R
$%',&2
% weight in index
as on 28 Mar 2012
NIM (%),
2011
Avg. RoE (%),
2011
1$
10
10
6RXUFH%ORRPEHUJ7DGDZXO&RPSDQ\GDWD1&%&5HVHDUFK
7KHPXOWLLQYHVWPHQWVHFWRULQ.6$FRQWLQXHGWRVOLGHLQIRUWKHIRXUWK
FRQVHFXWLYH\HDUDPLGKHLJKWHQHGXQFHUWDLQW\LQJOREDOPDUNHWV6HFWRUUHYHQXH
KDVGHFOLQHGVLQFH,QWRWDOUHYHQXHLQWKHVHFWRUIHOO<R<
WR65EQPDLQO\DV.LQJGRP¶VUHYHQXHFRQWUDFWHG<R<GXHWRVOXJJLVK
JURZWKLQWKHKRVSLWDOLW\VHFWRU+RZHYHUWKHSHUIRUPDQFHRIWKHUHVWRIWKH
VHFWRUFRQWLQXHGWRLPSURYH6,6&2ZLWKUHYHQXHXS<R<WR65EQLQ
HPHUJHGDVWKHWRSJDLQHULQWHUPVRIPDUNHWVKDUH7KHWZRRWKHUPDMRU
SOD\HUV$770&2DQG$%',&2SRVWHGDYHUDJHUHYHQXHJDLQVRIRYHUWKH
155
08/7,,19(670(17
1&%&$3,7$/
0$<
SUHYLRXV\HDU$$'&UHFRUGHGWKHVKDUSHVWIDOOLQUHYHQXHGRZQWR
65PQIURPLWVKLVWRULFDOKLJKLQ1HWLQFRPHLQWKHVHFWRUJUHZD
PDUJLQDO<R<1HWLQFRPHPDUJLQLPSURYHGWRLQIURP
LQPDLQO\DV.LQJGRP¶VSURILWVURVH<R<RQORZHURSHUDWLQJFRVWV
DQGEHWWHUPDUJLQVRIDVVRFLDWHFRPSDQLHV
Exhibit 99: Revenue of companies, 2009±11
Exhibit 100: Profitability of companies, 2009±11
65PQ
6,6&2
$$'&
$770&2
.,1*'20
6RXUFH7DGDZXO1&%&5HVHDUFK
.,1*'20
$770&2
6$,&
$%',&2
$$'&
6RXUFH7DGDZXO1&%&5HVHDUFK
,QWKHVHFWRU¶VDGMXVWHG3(DQG3%9PXOWLSOHVVWRRGDW[DQG[
FRPSDUHGWR[DQG[UHVSHFWLYHO\LQ52(LQ.6$¶VPXOWL
LQYHVWPHQWVHFWRUDYHUDJHGLQFRPSDUHGWRWKHSUHYLRXV\HDU
Exhibit 101: Comparison of P/B and ROE, 2010
Exhibit 102: Comparison of P/B and ROE, 2011
$$'&
52(
52(
.,1*'20
$770&2
.,1*'20
$770&2
6$5&2
6$5&2
6$,&
3%[
3%[
$%',&2
6,6&2
6$,&
6RXUFH%ORRPEHUJ7DGDZXO5HXWHUV1&%&5HVHDUFK
6L]HRIWKHEXEEOHUHSUHVHQWVPDUNHWFDSDVRQ0DUFK
6,6&2
$$'&
$%',&2
6RXUFH%ORRPEHUJ7DGDZXO5HXWHUV1&%&5HVHDUFK
6L]HRIWKHEXEEOHUHSUHVHQWVPDUNHWFDSDVRQ0DUFK
156
08/7,,19(670(17~0$<
.,1*'20+2/',1*
$/62.12:1$6.+&
Kingdom Holding Company, established in 1996, focuses on
banking and financial services, real estate, and hotels & hotel
management. Headquartered in Riyadh, the company has six
100% owned subsidiaries globally.
NOT COVERED
Current price (SR)
11.8
3ULFLQJDVRI
x Business brief
,QLWLDOO\HQJDJHGLQFRQVWUXFWLRQKRXVLQJGHYHORSPHQWDQGHGXFDWLRQDO
SURMHFWV.LQJGRPKDVLQFUHDVHGLWVVWDNHDFURVVVHFWRUVLQVHYHUDO6DXGL
$UDELDQ0LGGOH(DVWHUQDQGLQWHUQDWLRQDOFRPSDQLHV7KHFRPSDQ\¶V
STOCK DETAILS
SRUWIROLRLQFOXGHVSUHPLXPEUDQGVVXFKDV$SSOH7LPH:DUQHU6DPED
ZHHNUDQJH+/65
0DUNHWFDSPQ
&LWLJURXS3HSVL:DOW'LVQH\DQG+HZOHWW3DFNDUG.LQJGRPKDVLQYHVWHGLQ
6KDUHVRXWVWDQGLQJPQ
WKHGRPHVWLFKHDOWKHGXFDWLRQDQGVRFLDOVHUYLFHVVHFWRUV7KHFRPSDQ\
DOVRRSHUDWHVLQWKHSULYDWHHTXLW\VSDFHLQ6DXGL$UDELDDQGLQGHYHORSLQJ
Price perform (%) 1M
PDUNHWVLQWKH0LGGOH(DVW$IULFDDQG$VLD
$EVROXWH
x Financials
.LQJGRP¶VUHYHQXHVIHOO<R<WR65PQLQGXHWRDFKDQJH
LQWKHDFFRXQWLQJPHWKRGIURPFRQVROLGDWHGWRHTXLW\1HWLQFRPHIRU
JUHZ<R<WR65PQQGULYHQE\WKHLQFUHDVHLQLQFRPHIURP
LQYHVWPHQWVVDOHRIUHDOHVWDWHDQGGLYLGHQGV
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
x Recent developments
.LQJGRP¶VERDUGDSSURYHGWKHLVVXDQFHRIVXNXNZRUWK65PQDWWKH
(*0KHOGLQ0DUFK
6(
%ORRPEHUJFRGH
.,1*'20$%
ZZZNLQJGRPFRPVD
,Q)HEUXDU\WKH%RDUGRI'LUHFWRUVDSSURYHGWKHDFTXLVLWLRQRID
PQVTXDUHPHWHUFRPPHUFLDODUHD.LQJGRP2DVLVODQGDQGSURMHFWIRU
65PQ7KHDFTXLVLWLRQVWLOODZDLWVWKHJHQHUDODVVHPEO\
VDSSURYDO
WEIGHTING & FREE FLOAT (%)
6HSDUDWHO\.LQJGRP¶VRZQHGVXEVLGLDU\7UDGH&HQWHU&RPSDQ\
.LQJGRP&HQWHUDFTXLUHGDVTXDUHPHWHUFRPPHUFLDODUHDIRU
65PQ
VALUATION MULTIPLES
7$6,IUHHIORDWZHLJKW
)UHHIORDW
3([
09A
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
(36
%936
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
10
YoY
(%)
CAGR (%)
(08-11)
10
10
0D\
6HS
7$6,
-DQ
0D\
.LQJGRP5+6
TOP 5 SHAREHOLDERS (%)
3ULQFH$O:DOHHG%LQ7DODO$EGXO
$]L]$O6DXG
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
157
08/7,,19(670(17~0$<
$6((575$',1*
$/62.12:1$6$6((5
Established in 1977 and headquartered in Abha (Southwest
Saudi Arabia), Aseer Trading, Tourism and Manufacturing
Company (Aseer) is an investment holding company with
interests in five sectors ± food, petrochemicals, real estate,
building materials and construction, and financial services.
NOT COVERED
Current price (SR)
19.8
3ULFLQJDVRI
x Business brief
$VHHURSHUDWHVLQDZLGHUDQJHRIEXVLQHVVHVDQGKDVLQYHVWPHQWVLQGLYHUVH
SURMHFWVLQFOXGLQJDJULFXOWXUHFHPHQWSULQWLQJSXEOLVKLQJDQGHQHUJ\7KH
STOCK DETAILS
FRPSDQ\LVDOVRHQJDJHGLQWUDYHODQGWRXULVPDQGKDVVWDNHVLQUHVRUWVDQG
ZHHNUDQJH+/65
KRWHOV$VHHU¶VZKROO\RZQHGVXEVLGLDULHVLQFOXGH'DOODK,QGXVWULDO
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
,QYHVWPHQW&RPSDQ\$O8VWRRO$UDELD5HDO(VWDWH'HYHORSPHQW&R/WG$O
.KDZDWHP7UDGLQJ&RQWUDFWLQJ&R/WG$O1DVUDK,QWHUQDWLRQDO5HDO
Price perform (%) 1M
3M
12M
(VWDWH'HYHORSPHQW&R/WG$O0DZDMHG,QWHUQDWLRQDO5HDO(VWDWH
$EVROXWH
'HYHORSPHQW&RDQG$O7LODO5HJLRQDO,QYHVWPHQW&R7KHFRPSDQ\KDVVL[
0DUNHW
EUDQFKHVRQHHDFKLQ$O0DGLQDK5L\DGK:DGL$O'DZDVHU-HGGDK+DLO
6HFWRU
DQG$O-RXI
Avg daily turnover (mn)
x Financials
$VHHU¶VUHYHQXHVJUHZE\<R<WR65PQLQ(%,7'$
GHFOLQHG<R<WR65PQGXULQJWKHSHULRG1HWLQFRPHJUHZ
<R<WR65PQLQSULPDULO\GXHWRKLJKHULQYHVWPHQWLQFRPH
x Recent developments
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$770&2$%
ZZZDVHHUFRUSFRPVD
,Q'HFHPEHUWKHFRPSDQ\¶V%RDUGRI'LUHFWRUVSURSRVHGDGLYLGHQGRI
65SHUVKDUHIRUWKH\HDUHQGHG
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
3([
09A
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
10
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
10
10
0D\
6HS
-DQ
7$6,
0D\
$VHHU5+6
TOP 5 SHAREHOLDERS (%)
'DODW$O%DUDND+ROGLQJ&R
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
158
08/7,,19(670(17~0$<
6$8',,1'8675,$/6(59,&(6
$/62.12:1$66,6&2
Established in 1988, Saudi Industrial Services Company
(SISCO) undertakes large-VFDOHLQYHVWPHQWVLQ.6$¶V
infrastructure sector on the build-operate-transfer and buildoperate-own models. SISCO has business interests in water
desalination and distribution, development of industrial
estates, free zone ports and support services.
x Business brief
NOT COVERED
Current price (SR)
17.8
3ULFLQJDVRI
6,6&2¶VDIILOLDWH6XSSRUW6HUYLFHV2SHUDWLRQV&RRZQHGSURYLGHV
DQFLOODU\VHUYLFHVVXFKDVEXLOGLQJDQGFDUPDLQWHQDQFHFDWHULQJDQGJDV
VWDWLRQVLQLQGXVWULDOHVWDWHV6DXGL7UDGH([SRUW'HYHORSPHQW&R
RZQHGRSHUDWHVDIUHH]RQHDW-HGGDK,VODPLF6HDSRUWRQD%27EDVLV
.LQGDVD:DWHU6HUYLFHVRZQHGRSHUDWHVDFXELFPHWHUGD\
GHVDOLQDWLRQSODQWDQGZDWHUGLVWULEXWLRQQHWZRUN,QWHUQDWLRQDO:DWHU
'LVWULEXWLRQ&RRZQHGLVHQJDJHGLQEXLOGLQJDQGRSHUDWLQJZDWHU
GLVWULEXWLRQQHWZRUNVLQWKH.6$5HG6HD*DWHZD\7HUPLQDO&R
RZQHGSURYLGHVFRQWDLQHUKDQGOLQJVWHYHGRULQJDQGFDUJRVHUYLFHV6$
7$/.(RZQHGSURYLGHVFRPSOHWHORJLVWLFVVROXWLRQWRWKH
SHWURFKHPLFDOLQGXVWU\
x Financials
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6,6&2¶VUHYHQXHVJUHZ<R<WR65PQLQIURP65PQLQ
7KHFRPSDQ\¶VQHWLQFRPHMXPSHG<R<GXULQJWKHSHULRGWR
65PQIURP65PQPDLQO\GXHWRLQFUHDVHGRSHUDWLQJHIILFLHQF\DW5HG
6HD*DWHZD\7HUPLQDOV
x Recent developments
6(
%ORRPEHUJFRGH
6,6&2$%
ZZZVLVFRFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
,Q0DUFK6,6&2SURYLGHGDQXSGDWHRQWKHGHYHORSPHQWRIWKHZDWHU
GLVWULEXWLRQSURMHFW-9EHWZHHQ6,6&2$PLDQWLWLQWKHLQGXVWULDOFLWLHVRI
5L\DGKDQG4DVVLP7KHZRUNRQWKH,QGXVWULDO&LW\LQ5L\DGKLVH[SHFWHGWR
EHFRPSOHWHGE\WKHHQGRIZKLOHWKDWRQWKH4DVVLP,QGXVWULDOFLW\LV
H[SHFWHGWREHFRPSOHWHGE\$SULO
VALUATION MULTIPLES
09A
10A
11A
3([
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
YoY
CAGR (%)
2011
(%)
(08-11)
10
10
0D\
6HS
7$6,
-DQ
0D\
6,6&25+6
TOP 5 SHAREHOLDERS (%)
;HQHL,QGXVWULDO&R
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
159
08/7,,19(670(17~0$<
6$8',$5$%,$5(),1(5,(6
&203$1<
$/62.12:1$66$5&2
Saudi Arabia Refineries Company (SARCO), established in
Jeddah in 1959, invests in commercial and industrial projects
in and outside Saudi Arabia. The company is principally
involved in the purchase, refining, transportation, sale, import
and export of crude oil and petroleum products.
NOT COVERED
Current price (SR)
65.8
3ULFLQJDVRI
x Business brief
6$5&2RZQVVWDNHVLQ$UDELDQ6DOIRQDWHV&RPSDQ\$UDELDQ
7DQNHUV&RPSDQ\-HGGDK2LO5HILQHU\&R6DXGL,QGXVWULDO
STOCK DETAILS
,QYHVWPHQW*URXS7DEXN&HPHQWDQG5L\DG%DQN6$5&2
ZHHNUDQJH+/65
JHQHUDWHVLQFRPHIURPLWVVWDNHVLQRWKHUFRPSDQLHVDVZHOODVIURPFDSLWDO
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
JDLQVRQWKHVDOHRILWVLQYHVWPHQWV
x Financials
Price perform (%)
6$5&2KDVEHHQUHSRUWLQJOLWWOHWRQRUHYHQXHVDVPRVWRILWVLQFRPHFRPHV
IURPLWVLQYHVWPHQWVLQDVVRFLDWHV1HWLQFRPHGHFOLQHGE\WR
65PQLQGXHWRWKHGHFUHDVHLQGHSRVLWVDQGLQYHVWPHQWV
UHYHQXHVDQGLQFUHDVHRIVRPHLWHPVLQJHQHUDODQGDGPLQLVWUDWLYHH[SHQVHV
PDLQO\DGYHUWLVHPHQWV
x Recent developments
,Q)HEUXDU\6$5&2DQQRXQFHGWKDWLWLVFRQVLGHULQJUDLVLQJLWVVWDNH
LQ$UDELDQ6XOIRQDWH&RWRIURP
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6$5&2$%
ZZZDOPDVDILFRPVD
,Q'HFHPEHU6$5&2FRQILUPHGWKHDFTXLVLWLRQRIFRPSDQLHV
$UDELDQ7DQNHUV&RPSDQ\//&DQG$UDELDQ6DOYRQLWH&R
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
3([
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
10A
11A
3%[
36[
10
10
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
2008
10
10
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
09A
2009
10
10
2010
10
10
2011
10
10
YoY
(%)
10
10
CAGR (%)
(08-11)
10
10
SHARE PRICE PERFORMANCE
0D\
6HS
7$6,
-DQ
0D\
6$5&25+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
3ULQFH0HWH
HE%LQ$EGXO$]L]$O
6DXG
3ULQFH.KDOLG7XUNL$EGXO$]L]7XUNL
$O6DXG
6
7 G
O 1&%& 5
K
160
08/7,,19(670(17~0$<
$/$+6$'(9(/230(17
$/62.12:1$6$$'&
Al-Ahsa Development Company (AADC) was established in
1993 under the Royal Decree to undertake investment
activities in the industrial and service sectors of Saudi Arabia,
particularly in the region of Al-Ahsa. AADC has business
interests in foods, textiles, and medical services.
NOT COVERED
Current price (SR)
17.1
3ULFLQJDVRI
x Business brief
$$'&¶VDIILOLDWH$O$KVD0HGLFDO6HUYLFHV&RVWDNHPDQDJHVD
PRGHUQEHGKRVSLWDOLQWKH$O$KVDUHJLRQ$O$KVD)RRG6HUYLFHV&R
VWDNHD-9ZLWK(DVWHUQ$JULFXOWXUH'HYHORSPHQW&RKDVWKHFDSDFLW\ STOCK DETAILS
WRSURFHVVWRQVRIGDWHVDQGSURGXFHVGDWHPRODVVHVYLQHJDUGDWHV ZHHNUDQJH+/65
0DUNHWFDSPQ
DQGFRPSUHVVHGGDWHV7KHFRPSDQ\¶VDIILOLDWH6DXGL-DSDQHVH7H[WLOH&R
6KDUHVRXWVWDQGLQJPQ
VWDNHSURGXFHVV\QWKHWLFILEHUXVHGLQWKHSURGXFWLRQRIGUHVV
PDWHULDOV$O$KVD5HFUHDWLRQDQG7RXULVP&RVWDNHHVWDEOLVKHV
Price perform (%) 1M
DQGPDQDJHVUHFUHDWLRQDOSURMHFWV
$EVROXWH
x Financials
$$'&¶VUHYHQXHVGHFOLQHGWR65PQLQIURP65PQLQ
1HWLQFRPHIHOOE\WR65PQLQDVSURILWVIURPLWV5HDOHVWDWH
LQYHVWPHQWGHFOLQHGE\DERXW65PQ/RZHUSURILWVIURPWKHFRPSDQ\¶V
VHFXULWLHVLQYHVWPHQWH[HUWHGPRUHSUHVVXUHRQLWVERWWRPOLQH
x Recent developments
3M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
$$'&DFTXLUHGVKDUHVZRUWK65PQLQ7DNZHHQ$GYDQFHG
,QGXVWULHVLQ-DQXDU\7KLVDFTXLVLWLRQZDVLQOLQHZLWKWKHFRPSDQ\¶V
VWUDWHJ\RILQFUHDVLQJLWVH[SRVXUHWRWKHLQGXVWULDOVHFWRU
2Q'HFHPEHUWKHFRPSDQ\¶V6DXGL±-DSDQHVHWH[WLOHVXEVLGLDU\
VLJQHGD0HPRUDQGXPRI8QGHUVWDQGLQJ0R8ZLWKRQHRI,QGRQHVLD¶V
OHDGLQJWH[WLOHIDEULFPDQXIDFWXUHUVIRUUHVWDUWLQJWKH$O$KVDWH[WLOHIDFWRU\
7KHFRPSDQ\H[SHFWVWRUHRSHQWKHIDFWRU\LQHLJKWPRQWKV
$$'&¶V%RDUGRI'LUHFWRUVDSSURYHGWKHIXOODFTXLVLWLRQRI$O$KVD)RRG
,QGXVWULHV&RPSDQ\E\SXUFKDVLQJ$VK6KDUTL\DK'HYHORSPHQW&RPSDQ\¶V
VWDNHIRU65PQ
12M
6(
%ORRPEHUJFRGH
$$'&$%
ZZZDKVDGHYFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
SHARE PRICE PERFORMANCE
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
2008
10
10
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0D\
6HS
7$6,
-DQ
0D\
$O$KVDIRU'HY5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
161
08/7,,19(670(17~0$<
6$8',$'9$1&('
$/62.12:1$66$,&
Saudi Advanced Industries Co. (SAIC), established in 1987,
develops and promotes industrial projects under The
Economic Offset Program organized by the Ministry of
Defense and Aviation. SAIC encourages firms in the US, the
UK and France to collaborate with Saudi companies to
establish high-tech plants in diversified industries.
NOT COVERED
Current price (SR)
23.8
3ULFLQJDVRI
x Business brief
6$,&KDVVWDNHVLQ$O2EDLNDQ*ODVV&R136%DKUDLQIRU2LO
*DV6HUYLFHV&R*XOI6DOW&R$O6DODP$LUFUDIW&R
,QGXVWULDOL]DWLRQ(QHUJ\6HUYLFHV&R$UDELDQ,QGXVWULDO
)LEHUV&RDQG<DQEX1DWLRQDO3HWURFKHPLFDOV&R6$,&HQWHUVLQWR
FRQWUDFWVZLWKRWKHUILUPVWRVHWXSWHFKQRORJ\RULHQWHGFRPSDQLHV
STOCK DETAILS
ZHHNUDQJH+/65
6$,&¶VWRWDORSHUDWLQJUHYHQXHGHFOLQHG<R<WR65PQLQ1HW
LQFRPHIRUWKH\HDUIHOO<R<WR65PQGXHWRWKHLQFUHDVHLQ
*HQHUDODQG$GPLQLVWUDWLYHH[SHQVHVDQGGHFUHDVHLQHDUQLQJVIURP
LQYHVWHHV
x Recent developments
6$,&¶V%RDUGRI'LUHFWRUVDSSURYHGWKHDSSRLQWPHQWRI0U6DHG$O6KDPU\
DVWKHFRPSDQ\
V*HQHUDO0DQDJHUHIIHFWLYH-DQXDU\UHSODFLQJ
0U0DQVRXU$O<LK\DQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
x Financials
0DUNHWFDSPQ
1M
3M
12M
0DUNHW
6HFWRU
SR
US$
Avg daily turnover (mn)
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6$,&$%
ZZZVDLFFRPVD
WEIGHTING & FREEFLOAT (%)
2Q2FWREHU6$,&VDLGLWVRZQHGVXEVLGLDU\2EHLNDQ*ODVV
&RPSDQ\ZLOOVWDUWFRPPHUFLDORSHUDWLRQVRQ1RYHPEHU
7$6,IUHHIORDWZHLJKW
)UHHIORDW
,QUHIHUHQFHWRWKH$OOLDQFHGDWHG$SULO6$,&VDLGWKHFRPSDQ\KDV
UHJLVWHUHGLWVYHQWXUHZLWK1DWLRQDO,QGXVWULDOL]DWLRQ&RPSDQ\XQGHU
WKHQDPH$GYDQFHG3RO\RO0DQXIDFWXULQJ&RPSDQ\ZLWKFDSLWDORI
65PQ6$,&ZDVJUDQWHGDWKUHH\HDU,VODPLFILQDQFLQJIDFLOLW\E\6DXGL
+ROODQGL%DQNWRSD\IRULWVVKDUHRIWKHFDSLWDO65PQ
VALUATION MULTIPLES
09A
3([
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
1$
CAGR (%)
(08-11)
1$
0D\
6HS
7$6,
-DQ
0D\
6DXGL$GYDQFHG5+6
TOP 5 SHAREHOLDERS (%)
.KDOLG6DOHK$EGXO5DKPDQ$O
6KHWKU\ 6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPHEHUJ
162
08/7,,19(670(17~0$<
$/%$+$,19(670(17
$/62.12:1$6$O%$+$
Al-Baha Investment & Development Co. (Al-Baha) was
established in 1992 to develop and operate projects in AlBaha province. Engaged in a wide range of industrial,
commercial and agricultural activities, the company plans to
expand beyond the region. Al-BDKD¶VLQYestments include a
95% stake in Al-Baha Marble & Granite Company.
NOT COVERED
Current price (SR)
20.5
3ULFLQJDVRI
x Business brief
$O%DKDLVHQJDJHGLQZKROHVDOHDQGUHWDLOWUDGLQJDVZHOODVLQLQGXVWULDO
SURMHFWVLQFOXGLQJFRQVWUXFWLRQ7KHFRPSDQ\DOVRRSHUDWHVUHIULJHUDWLRQ
VWRUHVDVZHOODVUHSDLUDQGPDLQWHQDQFHZRUNVKRSVEHVLGHVGHYHORSLQJ
DQLPDODQGDJULFXOWXUDOSURGXFWV,QDGGLWLRQ$O%DKDRZQVDQGUHFODLPV
DJULFXOWXUDOODQGIRUXVHLQQHZSURMHFWV)XUWKHUPRUHWKHFRPSDQ\
FRQVWUXFWVPDLQWDLQVDQGRSHUDWHVSXEOLFXWLOLWLHVLQFOXGLQJWUDPZD\VDQG
GHYHORSVUHFUHDWLRQDODQGWRXULVWIDFLOLWLHVVXFKDVSDUNVDQGWRXULVWYLOODJHV
x Financials
$O%DKD¶VUHYHQXHVJUHZ<R<WR65PQLQ7KHFRPSDQ\¶VORVV
QDUURZHGWR65PQLQIURP65PQLQ$QLQFUHDVHLQJHQHUDO
DQGDGPLQLVWUDWLYHH[SHQVHVDQGDGHFOLQHLQWKHYDOXHRIDVVHWVSRVW
UHYDOXDWLRQKXUWWKHFRPSDQ\LQ
x Recent developments
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$%',&2$%
1$
2Q'HFHPEHU$O%DKDDQQRXQFHGWKHFDQFHOODWLRQRILWV0R8ZLWK
0DOD\VLD¶V3(563(&35,0(FLWLQJIDLOXUHWRUHDFKDILQDODJUHHPHQW
6HSDUDWHO\$O%DKDILOHGDODZVXLWDJDLQVW$O6DWHDD0RGHUQ*HQHUDO
&RQWUDFWLQJ&RPSDQ\DFFXVLQJ$O6DWHDDRIUHIXVLQJWRUHWXUQWKH65PQ
SDLGWRLWE\$O%DKDIRUDFTXLULQJDSDUWRI$O6DWHDD0RGHUQ*HQHUDO
&RQWUDFWLQJ&RPSDQ\¶VDVVHWV$O6DWHDDKDGGHFOLQHGWRJRDKHDGZLWKWKH
GHDODIWHULWUHMHFWHGWKHUHVXOWVRIWKHGXHGLOLJHQFHFRQGXFWHG
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
10
10
10
3%[
36[
10
10
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
10
10
2009
2010
2011
10
10
10
10
10
10
YoY
(%)
10
10
CAGR (%)
(08-11)
10
10
0D\
6HS
7$6,
-DQ
0D\
$O%DKD5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
163
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Industrial-Investment
Ticker
Company
Page No.
1211
MA'ADEN
167
2230
Saudi Chemical
168
2070
SPIMACO
169
1212
Astra Ind
170
1213
AlSorayai Group
171
2150
ZOUJAJ
172
1214
Shaker Group
173
2300
SPM
174
2340
AlAbdullatif
175
1210
BCI
176
2220
Maadaniyah
177
4140
Saudi Export
178
2180
FIPCO
179
1201
Takween
180
0$<
,1'8675,$/,19(670(17
+LJKHUYROXPHVDQGSULFHVGULYHVDOHV
7KH6DXGL$UDELDQLQGXVWULDOLQYHVWPHQWVHFWRULQFOXGHVFRPSDQLHV
ZKLFKRSHUDWHLQYDULRXVVHFWRUV7KHVHLQFOXGHPDFKLQHU\DQG
HTXLSPHQWFRQVXPHUGXUDEOHVFKHPLFDOVLQGXVWULDOWH[WLOHV
SKDUPDFHXWLFDOVSDFNDJLQJPLQLQJDQGSDSHU7KHVHFWRU¶V
UHYHQXHVURVHLQGXHWRWKHVWURQJSHUIRUPDQFHRI
6DXGL$UDELDQ0LQLQJ&R0DDGHQ$O+DVVDQ*KD]L,EUDKLP
6KDNHU&R6KDNHUDQG$VWUD,QGXVWULDO*URXS$VWUD
.6$¶VLQGXVWULDOLQYHVWPHQWVHFWRUFRQWLQXHGWRUHSRUWVWURQJUHYHQXHJURZWK
5HYHQXHVKDYHEHHQLQFUHDVLQJDWD&$*5RIVLQFH7KH52(RI
.6$¶VOLVWHGSOD\HUVDYHUDJHGDWFRPSDUHGWRWKH*&&DYHUDJHRI
LQ7KHVHFWRU¶VDGMXVWHG3(DYHUDJHGDW[IRU
Exhibit 103: Revenue of GCC industrial investment
companies, 2009±11
Exhibit 104: Comparison of ROE & P/E of GCC companies,
2011
86'PQ
52(
.6$
4DWDU
.XZDLW
3([
.6$
6RXUFH=DZ\D
4DWDU
.XZDLW
6RXUFH=DZ\D
7KHLQGXVWULDOLQYHVWPHQWVHFWRUKDVDODUJHQXPEHURISULYDWHSOD\HUVDQG
OLVWHGFRPSDQLHV$PRQJWKHOLVWHGSOD\HUV0DDGHQKDVWKHKHDYLHVWZHLJKWRI
LQWKH7$6,LQGH[LQWHUPVRIIUHHIORDW\HWLWVDYHUDJH52(IRU
VWRRGDWZKLFKLVUHJDUGHGORZZKHQFRPSDUHGWRSHHUVHFWRUFRPSDQLHV
Exhibit 105: Sector details
8QLWVDVVWDWHG
Country
% weight in Index
as on 28 Mar 2012
6DXGL$UDELDQ0LQLQJ&R0$$'(1
7KH6DXGL&KHPLFDO&R6&&2
6DXGL3KDUPDFHXWLFDO,QGXV0HGLFDO$SSOLDQFHV
&RUS63,0$&2
$O+DVVDQ*KD]L,EUDKLP6KDNHU&R6+$.(5
$VWUD,QGXVWULDO*URXS$675$
$O6RUD\DL7UDGLQJ,QGXVWULDO*URXS$/625$<$
%DVLF&KHPLFDO,QGXVWULHV&R%&,
7KH1DWLRQDO&RIRU*ODVV,QGXVWULHV=28-$-
6DXGL3DSHU0DQXIDFWXULQJ&R630
$O$EGXOODWLI,QGXVWULDO,QYHVWPHQW&R$/$%'8/
1DWLRQDO0HWDO0DQXIDFWXULQJ&DVWLQJ&R100&&
7DNZHHQ$GYDQFHG,QGXVWULHV7$.:((1
)LOOLQJ3DFNLQJ0DWHULDO0IJ&R),3&2
6DXGL,QGXVWULDO([SRUW&R6,(&2
NIM (%),
2011
Avg. RoE
(%), 2011
6RXUFH%ORRPEHUJ7DGDZXO&RPSDQ\GDWD
7KLVFRPSDQ\ZDVOLVWHGLQ
165
,1'8675,$/,19(670(17
1&%&$3,7$/
0$<
7KHVHFWRU¶VUHYHQXHVLQFUHDVHGWR65EQLQFRPSDUHGWR
65EQLQPDLQO\GXHWRWKHKLJKHUVDOHVYROXPHVDQGSULFHVRI
SURGXFWV0DDGHQUHSRUWHGWKHODUJHVWJURZWKLQUHYHQXHVZKLOH$O6RUD\DL
7UDGLQJ,QGXVWULDO*URXSUHSRUWHGDGHFOLQHLQUHYHQXHV7KHVHFWRU¶VQHWSURILW
JUHZWR65EQLQYHUVXV65EQLQUHFRUGLQJDQHWSURILW
PDUJLQRILQFRPSDUHGWRLQ
Exhibit 106: Revenue of companies, 2009±11
Exhibit 107: Profitability of Maaden relative to sector
average
65PQ
63,0$&2
6&&2
630
$/$ %'8/
0$$'(1
$/62 5$< $,
6+$.( 5
2WKHUV
$675$
6HFWRU$YH UDJH
0$$'(1
6RXUFH7DGDZXO
6RXUFH7DGDZXO
7KHVHFWRU¶VDYHUDJH52(DQG3%9PXOWLSOHVVWRRGDWDQG[
UHVSHFWLYHO\LQFRPSDUHGWRWKHFRUUHVSRQGLQJILJXUHVRIDQG[
LQ$PRQJWKH6DXGL$UDELDQSHHUV6+$.(5KDGWKHKLJKHVW52(RI
LQ
Exhibit 109: Comparison of P/B and ROE, 2011
3%[
52(
52(
Exhibit 108: Comparison of P/B and ROE, 2010
3%[
=28-$ -
),3 &2
100&&
6&&2
630
$/$ %'8/
6,(&2
0$$'(1
%&,
$675$
63,0$&2
$/62 5$< $
6+$.( 5
7$.:((1
6RXUFH7DGDZXO
=28-$ -
),3 &2
100&&
6&&2
630
$/$ %'8/
6,(&2
0$$'(1
%&,
$675$
63,0$&2
$/62 5$< $
6+$.( 5
7$.:((1
6RXUFH7DGDZXO
166
,1'8675,$/,19(670(17~0$<
6$8',$5$%,$10,1,1*
$/62.12:1$60$$'(1
Established in 1997, Saudi Arabian Mining Company
0D¶DGHQH[SORUes and produces metals and non-metal ores.
The company owns five operating precious metal extraction
mines and several new projects. In July 2008, 0D¶DGHQZHQW
public and raised SR9.2bn, UHGXFLQJWKHJRYHUQPHQW¶V
holding to 55% from 100%.
x Business brief
NOT COVERED
Current price (SR)
31.5
3ULFLQJDVRI
0D¶DGHQFXUUHQWO\KDVWZREXVLQHVVOLQHVJROGPLQLQJDQG0DDGHQ
3KRVSKDWH&RPSDQ\03&ZKLFKLVD65EQSURMHFWWRVHWXSD
GLDPPRQLXPSKRVSKDWH'$3SURGXFWLRQIDFLOLW\03&LVDMRLQW
YHQWXUHEHWZHHQ0D¶DGHQDQG6$%,&0D¶DGHQKDVDWRWDODQQXDOSURGXFWLRQ
FDSDFLW\RIWRQVRIDPPRQLDWRQVRISKRVSKRULFDFLG
WRQVRIFDXVWLFFDOFLQHGPDJQHVLDDQGWRQVRIJROGDQGVLOYHU
x Financials
0D¶DGHQ¶VVDOHVIRUJUHZ<R<WR65PQ7KLVLVPDLQO\
DVFULEHGWRWKHFRPPHQFHPHQWRIFRPPHUFLDOSURGXFWLRQRIDPPRQLDLQ
2FWREHUDQLQFUHDVHLQWKHDYHUDJHSULFHRIDPPRQLDDQGKLJKHUVDOHV
YROXPHDQGDYHUDJHUHDOL]HGSULFHSHURXQFHRIJROG7KHFRPSDQ\UHSRUWHG
DQHWSURILWRI65PQLQFRPSDUHGWRDORVVRI65PQLQ
SULPDULO\OHGE\LPSURYHGPDUJLQVDQGORZHU=DNDWSURYLVLRQV
x Recent developments
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
0$$'(1$%
ZZZPDDGHQFRPVD
,Q0DUFK0DDGHQDQG$OFRDDQQRXQFHGWKDWZRUNWRDGGDQHZ
SURGXFWLRQOLQHWRWKHMRLQWYHQWXUHDOXPLQXPFRPSOH[DW5DV$O.KDLULQ
6DXGL$UDELDKDVFRPPHQFHG:LWKDDQQXDOFDSDFLW\RIPHWULF
WRQVWKHFRPSOH[ZRXOGSURGXFHVKHHWVIRUXVHLQWKHDXWRPRWLYHDQG
FRQVWUXFWLRQLQGXVWULHVSURGXFWLRQLVH[SHFWHGWRFRPPHQFHLQ
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
3([
09A
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
2009
2010
2011
YoY
(%)
10
10
CAGR (%)
(08-11)
0 D\
6HS
7$ 6,
-DQ
0 D\
0 $ $ '(15+6
TOP 5 SHAREHOLDERS (%)
3XEOLF,QYHVWPHQW)XQG
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH
3XEOLF3HQVLRQ$JHQF\
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
167
,1'8675,$/,19(670(17~0$<
6$8',&+(0,&$/
$/62.12:1$66&&
Saudi Chemical Company (SCC) manufactures and sells
explosives and detonators for civil and military use. In 2004,
SCC entered the seismic explosives market, serving the oil,
and gas exploration sector. 7KHFRPSDQ\¶Vsubsidiary Saudi
International Trading Company (SITCO Pharma) supplies
medical and surgical equipment to hospitals and medical
centers.
x Business brief
6&&
VSURGXFWVLQFOXGH3ULOH[DEODVWLQJDJHQWSULPDULO\XVHGIRU
XQGHUJURXQGDSSOLFDWLRQVDQGILVVXUHGVHGLPHQWDU\URFNV.HPXOH[DQ
HPXOVLRQH[SORVLYHXVHGIRUXQGHUZDWHUEODVWLQJDQGZRUNVLWHVZLWKZHW
KROHV6DQHODQRQHOHFWULFVKRFNWXEHXVHGIRUEHQFKDQGWUHQFKEODVWLQJ
GHWRQDWLQJFRUGVHOHFWULFGHWRQDWRUVH[SORVLYHVSDFNLQJDQGEODVWLQJ
PDFKLQHV
x Financials
6&&¶VVDOHVJUHZ<R<WR65PQLQ(%,7'$IHOOWR
65PQGXHWRORZHUSURILWPDUJLQRIWKHGHWRQDWRUVVHJPHQWDQGKLJK
FRPSHWLWLRQLQWKHH[SORVLYHVVHFWRU1HWLQFRPHIXUWKHUGHFUHDVHG
<R<WR65PQGXHWRDQLQFUHDVHLQSURYLVLRQV
NOT COVERED
Current price (SR)
3ULFLQJDVRI
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
2Q2FWREHUWKHFRPSDQ\VLJQHGD65PQFRQWUDFWZLWK$XVWLQ
3RZGHU&RPSDQ\RI&]HFK5HSXEOLFWRLQFUHDVHWKHSURGXFWLRQFDSDFLW\RI
QRQHOHFWULFGHWRQDWRUVE\LQWKHZHVWHUQUHJLRQIDFWRU\7KHH[SDQVLRQ
LVH[SHFWHGWRFRPSOHWHE\4
,Q-XQH6,7&23KDUPDUHQHZHGLWVFRQWUDFWZLWK(OL/LOO\
3KDUPDFHXWLFDOV$FFRUGLQJWRWKHWHUPVRIWKHDJUHHPHQW6,7&2ZRXOGDFW
DVWKHVROHGLVWULEXWRUIRU(OL/LO\SURGXFWVLQWKH.LQJGRP
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x Recent developments
41.3
6&&2$%
ZZZVDXGLFKHPLFDOFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0 D\
6HS
7$ 6,
-DQ
0 D\
6&&5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
6RXUFH7DGDZXO1&%&5HVHDUFK
168
,1'8675,$/,19(670(17~0$<
6$8',3+$50$&(87,&$/
$/62.12:1$663,0$&2
Saudi Pharmaceutical Industries & Medical Appliances
Corporation (SPIMACO) manufactures medicine and medical
appliances for local and international markets. Since its
establishment in 1986, SPIMACO has augmented its annual
production capacity to include 3.5mn liters of liquid medicine,
850mn tablets, and 55mn capsules of cream and ointment,
aseptic drops and penicillin.
NOT COVERED
Current price (SR)
44.5
3ULFLQJDVRI
STOCK DETAILS
x Business brief
63,0$&2¶VSURGXFWVLQFOXGH=LPD[)RUPLW3URWRQ)DPRFLG&RUWLPD[
6DSRIHQ3OXVDQG*OD]H7KHFRPSDQ\KHOGWKHODUJHVWPDUNHWVKDUHDPRQJ
SULYDWHSOD\HUVLQWHUPVRIRZQSURGXFWVDVZHOODVOLFHQVRUV¶SURGXFWVLQWKH
.6$63,0$&2KDVHLJKWZKROO\RZQHGVXEVLGLDULHVZKLFKKHOSWKH
FRPSDQ\WRPDLQWDLQLWVOHDGHUVKLSSRVLWLRQLQWKH6DXGL$UDELDQPDUNHW
x Financials
63,0$&2¶VUHYHQXHVLQFUHDVHG<R<WR65PQLQGXHWR
LQFUHDVHGSURGXFWLRQHIILFLHQF\(%,7'$JUHZ<R<WR65PQ
ZKLOHQHWLQFRPHLQFUHDVHG<R<WR65PQ7KHLQFUHDVHLQ
SURILWDELOLW\ZDVDWWULEXWDEOHWREHWWHUVDOHVLQWKHKLJKHUPDUJLQVHJPHQWV
DQG<R<LQFUHDVHLQWKHFDVKGLYLGHQGVUHFHLYHGIURPWKH
SHWURFKHPLFDOFRPSDQLHVLQZKLFK63,0$&2KDVHTXLW\LQYHVWPHQWV
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
63,0$&2$%
ZZZVSLPDFRFRPVD
x Recent developments
2Q0DUFKWKHFRPSDQ\DQQRXQFHGWKDWLWKDGDFTXLUHGD
VWDNHZRUWK65PQLQ(LUJHQ3KDUPD/LPLWHG,UHODQG
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
7KHFRPSDQ\DOVRDQQRXQFHGWKDW&$'ZKLFKLVRZQHGE\63,0$&2
ZRXOGJHWDORDQRI65PQIURP6DXGL,QGXVWULDO'HYHORSPHQW)XQGWR
ILQDQFHLWVSURMHFWRIPDQXIDFWXULQJUDZPDWHULDOVXVHGLQWKHSKDUPDFHXWLFDO
LQGXVWU\7KHSURMHFWLVORFDWHGLQ5L\DGKDQGLVH[SHFWHGWREHFRPSOHWHGE\
PLG
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
10
CAGR (%)
(08-11)
10
0 D\
6HS
7$ 6,
-DQ
0 D\
63 ,0 $ &25+6
TOP 5 SHAREHOLDERS (%)
$UDE&RPSDQ\IRU'UXJ
,QGXVWULHV0HGLFDO$SSOLDQFHV
3XEOLF3HQVLRQ$XWKRULW\33$
.KDOHG6$$O6KHWUL
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
169
,1'8675,$/,19(670(17~0$<
$675$,1'8675,$/
$/62.12:1$6$,*$675$
Astra Industrial Group (Astra) operates in the healthcare,
chemical, engineering, agricultural and home furnishing
industries. 7KHFRPSDQ\¶V subsidiaries are Tabuk
Pharmaceutical Manufacturing Co, Astra Polymer
Compounding, Astra Industrial Complex Co, and International
Building Systems Factory Co.
x Business brief
NOT COVERED
Current price (SR)
41.2
3ULFLQJDVRI
$VWUD¶VEURDGSURGXFWSRUWIROLRLQFOXGHVDUDQJHRIJHQHULFDQGXQGHU
OLFHQVHGSKDUPDFHXWLFDOSURGXFWVDGGLWLYHVDQGFRPSRXQGVXVHGLQSODVWLF
SURGXFWSURGXFWLRQIHUWLOL]HUVDJULFXOWXUDOSHVWLFLGHVLQVHFWLFLGHVDQG
IXQJLFLGHVDQGSLOORZVEHGVKHHWVDQGPDWWUHVVSDGV7KHFRPSDQ\DOVR
FRQVWUXFWVPHWDOEDVHGSUHHQJLQHHUHGLQGXVWULDOEXLOGLQJVDQGVWHHO
VWUXFWXUHV
x Financials
$VWUDUHSRUWHGJURZWKLQVDOHVWR65PQGXHWRLPSURYHG
SHUIRUPDQFHDFURVVVHJPHQWVLQ(%,'7$LQFUHDVHGDWDORZHUUDWHRI
<R<WR65PQGXHWRKLJKHUPDUNHWLQJH[SHQVHVLQFXUUHGLQQHZ
PDUNHWV7KH<R<GHFOLQHLQQHWLQFRPHFDQEHDVFULEHGPDLQO\WRD
QRQUHFXUULQJSURILWRI65PQUHFRUGHGODVW\HDUIROORZLQJWKHVDOHRI
$UDELDQ&RPSDQ\IRU&RPIRUWV3LOORZV
x Recent developments
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$675$$%
ZZZDVWUDLQGXVWULDOFRPVD
2Q0DUFK$VWUDDQQRXQFHGWKDWLWVRZQHGVXEVLGLDU\$VWUD
0LQLQJ&RPSDQ\ZRXOGVWDUWDFDOFLXPFDUERQDWHSODQWZRUWK65PQ7KH
SODQWZRXOGEHILQDQFHGSDUWO\E\$VWUD0LQLQJ¶VSDUWQHUVDQGORDQVIURP
ILQDQFLDOLQVWLWXWLRQV7ULDORSHUDWLRQVDWWKHSODQWDUHH[SHFWHGWREHJLQ
GXULQJWKHVHFRQGKDOIRI
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
10
0 D\
6HS
7$ 6,
-DQ
0 D\
$ VWUD,QGXVW5+6
TOP 5 SHAREHOLDERS (%)
$UDE6XSSO\DQG7UDGLQJ
&RUSRUDWLRQ$675$
0RKDPPHG1HMLU6DTHU$O8WDLEL
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
170
,1'8675,$/,19(670(17~0$<
$/625$<$,75$',1*
$/62.12:1$6$/6252<$,
Al Sorayai Trading & Industrial Group (Al Sorayai) is a
wholesale and retail distributor of carpets, rugs, floorings,
furniture, blankets, curtain fabrics and related materials. The
company exports products to almost 65 countries, including
the US, China, India, Iraq, Russia and Poland.
NOT COVERED
Current price (SR)
25.4
3ULFLQJDVRI
x Business brief
$O6RUR\DLIRUPHUO\NQRZQDV$O6RUD\DL&DUSHW)DFWRU\&RPSDQ\/WG
PDQXIDFWXUHVFDUSHWVUXJVFXUWDLQVDQGDFFHVVRULHVIRUWKHGRPHVWLFDQG
H[SRUWPDUNHWV,WKDVWKHFDSDFLW\WRSURGXFHPQVTPHWHUVRIFDUSHWV
SHUDQQXP$O6RUD\DLGHULYHVDURXQGRILWVUHYHQXHIURPWKH6DXGL
PDUNHWDQGWKHUHVWIURPH[SRUWVWRRYHUFRXQWULHVDFURVVWKHZRUOG,Q
)HEUXDU\WKHFRPSDQ\UDLVHG65PQWKURXJKDQ,32
STOCK DETAILS
ZHHNUDQJH+/65
$O6RUR\DL¶VUHYHQXHVIRUGHFUHDVHG<R<WR65PQ7KHGHFOLQH
ZDVPDLQO\GXHWRHFRQRPLFDQGSROLWLFDOLQVWDELOLW\DFURVVWKHJOREH(%,7'$
IRUGHFOLQHG<R<WR65PQGXHWRLQFUHDVLQJUDZPDWHULDO
SULFHVZKLFKZHUHQRWDEVRUEHGE\VDOHV7KHQHWSURILWSOXQJHG<R<
WR65PQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
x Financials
0DUNHWFDSPQ
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
x Recent developments
,QRUGHUWRGLYHUVLI\UHYHQXHVLQ'HFHPEHU$O6RUD\DLDQQRXQFHG
SODQVWRH[SDQGLWVRSHUDWLRQVLQ6DXGL$UDELD7KHFRPSDQ\LVNHHQWR
H[SDQGLQWKHUHDOHVWDWHVHFWRUEHVLGHVVXSSRUWDQGORJLVWLFV
2Q$SULOWKHFRPSDQ\DQQRXQFHGWKDWLWKDGVWDUWHGDIXOO\RZQHG
EUDQFKLQ%UXVVHOV%HOJLXPXQGHUWKHQDPH0LOOHQQLXP:HDYHUV
2Q1RYHPEHU$O6RUD\DLDQQRXQFHGWKDWLWKDGVHFXUHGDVL[\HDU
65PQORDQIURPWKH6DXGL,QGXVWULDO'HYHORSPHQW)XQGWRH[SDQGLWV
FDUSHWIDFWRU\LQ-HGGDK,QGXVWULDO&LW\
6(
%ORRPEHUJFRGH
$/625$<$$%
ZZZDOVRUD\DLFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0 D\
6HS
7$ 6,
-DQ
0 D\
$ OVR UD\DL5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
1DIHL1DVVHU$EGXO$]L]$O6RUD\DL
0RKDPPHG1DVVHU$EGXO$]L]$O
6RUD\DL
1DVVHU$EGXO$]L]$O6RUD\DL
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
171
,1'8675,$/,19(670(17~0$<
1$7,21$/&2)25*/$66
$/62.12:1$6=28-$-
National Company for Glass Industries (Zoujaj) owns glass
container factories in Riyadh and Dammam. Zoujaj has a 45%
stake in Saudi Guardian International Float Glass and
Guardian RAK, and a joint venture with Guardian Industries.
These companies manufacture float glass for automotive and
construction applications. Zoujaj owns 50% of lighting
products manufacturer, Saudi National Lamps & Electrical Co.
x Business brief
=RXMDM¶VSODQWVLQ5L\DGKDQG'DPPDPSURGXFHPHWULFWRQVRIJODVV
FRQWDLQHUVHDFK\HDUIRUWKHIRRGDQGEHYHUDJHLQGXVWU\7KHVHSODQWV
SURGXFHW\SHVRIUHWXUQDEOHQRQUHWXUQDEOHERWWOHV6DXGL*XDUGLDQ
,QWHUQDWLRQDO)ORDW*ODVV&RPDQXIDFWXUHVPHWHUVRIIORDWJODVVSHU
\HDU*XDUGLDQ5$.ZLWKDFDSDFLW\RIWRQVSHUGD\LPSOHPHQWVDKL
WHFKJODVVFRDWLQJWHFKQRORJ\WRH[SDQGLWVIORDWJODVVRIIHULQJVWRUHJLRQDO
FOLHQWV
NOT COVERED
Current price (SR)
3ULFLQJDVRI
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
x Financials
,Q=RXMDM¶VUHYHQXHVLQFUHDVHG<R<WR65PQ(%,7'$
FRQWUDFWHGWRLQGXHWRORZHUUHDOL]DWLRQRQWKHDYHUDJHSULFHRI
JODVVERWWOHVDQGLQFUHDVHGRSHUDWLQJH[SHQVHVPDLQO\HOHFWULFLW\FRVW
+RZHYHUWKHQHWLQFRPHLQFUHDVHGLQSULPDULO\GXHWREHWWHU
SHUIRUPDQFHE\DVVRFLDWHVLQWKHIORDWJODVVVHJPHQW
32.7
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
=28-$-$%
ZZZ]RXMDMJODVVFRP
WEIGHTING & FREEFLOAT (%)
x Recent developments
7KHFRPSDQ\KDVVLJQHGDPHPRUDQGXPRIXQGHUVWDQGLQJZLWKWZR
FRPSDQLHV,WVLJQHGDGHDOZLWK7KH(DVWHUQ&RPSDQ\IRU,QGXVWULDO
,QYHVWPHQWWRDFTXLUHLWVVWDNHLQ6DXGL*XDUGLDQ,QWHUQDWLRQDO)ORDW
*ODVV&RPSDQ\7KHRWKHUGHDOLVZLWK=DPLO*URXS+ROGLQJ&RPSDQ\WR
DFTXLUHWKHODWWHU¶VVWDNHLQ*XDUGLDQ=RXMDM,QWHUQDWLRQDO)ORDW*ODVV
&RPSDQ\
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0 D\
6HS
7$ 6,
-DQ
0 D\
=R XMDM5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
5L\DGK0$EGXOODK$O+XPDLGDQ
6RXUFH7DGDZXO1&%&5HVHDUFK
172
,1'8675,$/,19(670(17~0$<
$/+$66$1*+$=,,%5$+,0
6+$.(5&2
$/62.12:1$66+$.(5
Al Hassan Ghazi Ibrahim Shaker Company (Shaker) imports
and wholesales air conditioning products and home
appliances. The Shaker Group comprises the parent company
and three subsidiaries, and is one of the leading players in its
sector in KSA. The company completed its IPO in May 2010.
x Business brief
NOT COVERED
Current price (SR)
70.0
3ULFLQJDVRI
6KDNHUVHOOVUHSDLUVDQGPDLQWDLQVDLUFRQGLWLRQHUVDQGKRPHDSSOLDQFHV
STOCK DETAILS
7KHFRPSDQ\¶VSRUWIROLRFRPSULVHVRYHUHLJKWEUDQGVZLWKQDWLRQZLGH
ZHHNUDQJH+/65
SUHVHQFHDQGVWURQJPDUNHWSRVLWLRQ6KDNHUDOVRVHOOV2(0SURGXFWVXQGHU
0DUNHWFDSPQ
LWVODEHO([FOXVLYHVDOHVRXWOHWVVHUYLFHDQGGLVSOD\FHQWHUVZDUHKRXVLQJ
6KDUHVRXWVWDQGLQJPQ
IDFLOLWLHVDQGWUDLQLQJDFDGHPLHVKHOSHGWKHFRPSDQ\WRH[SDQGSUHVHQFHLQ
Price perform (%) 1M
.6$6KDNHUKDVEUDQFKHVLQWKH.LQJGRPZLWKVKRZURRPVLQ-HGGDK$O
$EVROXWH
4DVVLP.KDPLV0XVKD\W5L\DGKDQG.KREDU
x Financials
5HYHQXHJUHZ<R<WR65PQLQ(%,'7$PDUJLQGHFOLQHG
WRIURPLQGXHWRKLJKHURSHUDWLQJH[SHQVHV1HWLQFRPH
URVH<R<WR65PQKRZHYHUQHWPDUJLQGHFOLQHGWRGXULQJ
WKH\HDUSULPDULO\GXHWRKLJKHULQWHUHVWH[SHQVH
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
x Recent developments
6(
%ORRPEHUJFRGH
2Q'HFHPEHU,EUDKLP+XVVHLQ6KDNHU3URMHFWDQG0DLQWHQDQFH
WKHFRPSDQ\
VIXOO\RZQHGVXEVLGLDU\VLJQHGWZRFRQWUDFWVZRUWK65PQ
ZLWKWKH0LQLVWU\RI(GXFDWLRQWRGHOLYHU/*DLUFRQGLWLRQLQJFKLOOHUVWRYDULRXV
VFKRROVLQWKH.LQJGRPZLWKLQIRXUPRQWKV
6+$.(5$%
ZZZVKDNHUFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
2Q0DUFKWRDFKLHYHFRRSHUDWLRQLQWKHPDUNHWLQJDQGVDOHVRI/*
6RODUDQG/LJKWLQJ/('DQG3/6SURGXFWVWKHFRPSDQ\VLJQHGDRQH\HDU
0R8ZLWK/*(OHFWURQLFV
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO]DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0 D\
6HS
7$ 6,
-DQ
0 D\
6+$ .(55+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
$.$O0XKDLGLEDQG6RQV*URXS
,EUDKLP$EGXOODK$DQG%URWKHUV
7DZD]RQ$UDELD&RIRU&RP,QY
/DPDD+ROGLQJ
$O0XWODT*URXS&R
6RXUFH7DGDZXO1&%&5HVHDUFK
173
,1'8675,$/,19(670(17~0$<
6$8',3$3(5
$/62.12:1$6630&6$8',3$3(5*5283
Saudi Paper Manufacturing Company (SPMC) is among the
few integrated paper companies in the MENA region. SPMC
produces tissue paper, tissue rolls and other paper products,
and also owns recycling operations.
NOT COVERED
Current price (SR)
30.9
3ULFLQJDVRI
x Business brief
630&KDVWKUHHSDSHUSURFHVVLQJSODQWVZLWKDFDSDFLW\RIWRQVRI
WLVVXHSDSHUWRQVRIFRQYHUWHGSDSHUDQGWRQVRIGHLQNHG
SDSHUSHU\HDUUHVSHFWLYHO\7KHFRPSDQ\¶VZKROO\RZQHGVXEVLGLDU\±
STOCK DETAILS
6DXGL3DSHU&RQYHUWLQJ&R63&&±FRQYHUWVWLVVXHUROOVLQWREUDQGHG
ZHHNUDQJH+/65
FRQVXPDEOHVZKLFKDUHGLVWULEXWHGWKURXJKWKHZKROHVDOHDQGUHWDLO
0DUNHWFDSPQ
FKDQQHOV6DXGL5HF\FOLQJ&R65&FROOHFWVZDVWHSDSHUWKDWVHUYHVDV
6KDUHVRXWVWDQGLQJPQ
IHHGIRU630&¶VGRZQVWUHDPGHLQNLQJSODQWV$O0DGDU7UDGLQJ&RZDVVHW
Price perform (%) 1M
XSLQWKH8$(WRFROOHFWZDVWHSDSHUIURPLQWHUQDWLRQDOVRXUFHV
$EVROXWH
x Financials
630&¶VUHYHQXHJUHZ<R<WR65PQLQ(%,7'$PDUJLQ
FRQWUDFWHG<R<WR65PQGXHWRDQ<R<LQFUHDVHLQ
SURGXFWLRQFRVWGXULQJWKH\HDU7KLVZDVGXHWRORQJKDOWVLQSURGXFWLRQDQG
WULDOSURGXFWLRQUXQVRQWKHIRXUWKOLQHRISURGXFWLRQRISDSHUWKDWUHTXLUHG
VRPHWHFKQLFDOHQKDQFHPHQWV1HWLQFRPHIHOO<R<WR65PQGXH
WRLQFUHDVHLQSURYLVLRQVIRUREVROHWHLQYHQWRU\
x Recent developments
3M
12M
0DUNHW
6HFWRU
SR
US$
Avg daily turnover (mn)
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
630$%
ZZZVDXGLSDSHUFRP
2Q'HFHPEHU630&FDQFHOOHGLWVGHDOZLWK&'*0DURFGXHWRWKH
SUHYDLOLQJXQFHUWDLQW\LQWKHFHOOXORVHLQGXVWU\
630&DSSRLQWHG0U-DPHV'DYLG3KHHEVWRWKH%RDUGRI'LUHFWRUVKH
UHSODFHG0U5DHG%LQ$EGXOUDKPDQ%LQ$EGXOD]L]$O0HVKDDOZLWKHIIHFW
IURP'HFHPEHU
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
2008
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
SHARE PRICE PERFORMANCE
0 D\
6HS
7$ 6,
-DQ
0 D\
63 0 5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
++3ULQFH$EGXOODK%LQ0XVDHG
%LQ$EGXO$]L]$O6DXG
)DOFRP)LQDQFLDO6HUYLFHV&R
6RXUFH7DGDZXO]DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
174
,1'8675,$/,19(670(17~0$<
$/$%'8//$7,),1'8675,$/
$/62.12:1$6$,,&
Established in 1981, Al-Abdullatif Industrial Investment
Company (Al Abdullatif) ranks among the largest carpet
manufacturers in the Middle East and Africa region. The
company has fully integrated operations, from fiber extrusion
to finishing. Its affiliates are ADFA Blanket Co., Eastern Textile
Co., National Spinning Co., Shahd Paper Tubes, and Nadeen
Arabian Color Co.
x Business brief
$O$EGXOODWLIPDQXIDFWXUHVWKUHHNLQGVRIFDUSHWVWXIWHGZRYHQDQGQRQ
ZRYHQSULPDULO\PDGHIURPV\QWKHWLFILEHUV7KHFRPSDQ\H[SRUWVWKHVH
FDUSHWVWRPRUHWKDQFRXQWULHV7KHFRORUSLJPHQWGLYLVLRQSURYLGHV
YDULRXVVKDGHVUHTXLUHGWRPDNHFDUSHWVDQGEODQNHWV7KHSDSHUWXEH
VHJPHQWRIIHUVSDSHUWXEHVRIGLIIHUHQWVL]HVDQGWKLFNQHVVHVIRUZLQGLQJ
FDUSHWVDQG\DUQ$O$EGXOODWLIKDVWKHFDSDFLW\WRSURGXFHPQEODQNHWV
DQGPQVTPHWHUVRIFDUSHWVSHUDQQXP
NOT COVERED
Current price (SR)
3ULFLQJDVRI
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
x Financials
$O$EGXOODWLI¶VUHYHQXHVJUHZ<R<WR65PQLQ(%,'7$
UHPDLQHGFRQVWDQWDW65PQGXHWRKLJKRSHUDWLRQDOFRVWDQG
DGPLQLVWUDWLYHH[SHQVHV7KHQHWSURILWLQFUHDVHG<R<WR65PQLQ
PDLQO\GXHWRSURILWVIURPLQYHVWHGHQWLWLHV
x Recent developments
27.5
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$/$%'8/$%
ZZZFDUSHWVFRP
$O$EGXOODWLIDQQRXQFHGWKHDSSRLQWPHQWRIH[WHUQDODXGLWRUVIRUWKH\HDU
DQGWKHGLVWULEXWLRQRIFDVKGLYLGHQGRU65SHUVKDUHIRUWKH
\HDUHQGHG'HFHPEHU
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
3([
09A
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0 D\
6HS
7$ 6,
D
-DQ
0 D\
$ O$ EGXOODWLI5+6
TOP 5 SHAREHOLDERS (%)
$EGXO/DWLI+ROGLQJ*URXS
2PDU6XODLPDQ6DOHK$O$EGXO/DWLI
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
175
,1'8675,$/,19(670(17~0$<
%$6,&&+(0,&$/,1'8675,(6
$/62.12:1$6%&,
,Q
Basic Chemical Industries (BCI), incorporated in 1973,
produces and sells chemicals through its subsidiaries, which
include Saudi Water Treatment (100% stake), National
Adhesive (47% stake), Basic Chemicals National (100% Stake),
Chemical Marketing and Distribution (99% stake), OKAZ
Chemical Marketing and Distribution Co. (100% stake), and
Arabian Polyol.
NOT COVERED
Current price (SR)
31.1
3ULFLQJDVRI
STOCK DETAILS
x Business brief
%&,SURGXFHVDYDULHW\RIFKHPLFDOVVXFKDVOLTXHILHGFKORULQHJDV
K\GURFKORULFDFLGFDXVWLFVRGDSRO\XUHWKDQHSRO\RODGKHVLYHVFDOFLXP
FKORULGHZDWHUWUHDWPHQWFKHPLFDOVODXQGU\DQGMDQLWRULDOSURGXFWV7KH
FRPSDQ\¶VSODQWORFDWHGLQWKH)LUVW,QGXVWULDO=RQHLQ'DPPDP&LW\KDVDQ
DQQXDOSURGXFWLRQFDSDFLW\RIPWRIJDVHV7KHFRPSDQ\KDVD
SRO\XUHWKDQHSODQWPWSDDFKHPLFDOSODQWPWSDDQ
DGKHVLYHVSODQWPWSDDQGDVXOIXULFDFLGSODQWPWSD
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
x Financials
%&,¶VUHYHQXHJUHZ<R<WR65PQLQ(%,7'$LQFUHDVHG
<R<WR65PQ1HWLQFRPHGHFUHDVHG<R<WR65PQLQ
7KHGHFUHDVHLVGXHWRKLJKHURSHUDWLQJH[SHQVHVDQGLQFUHDVHG
VKDUHRIPLQRULW\LQWHUHVWLQSURILWVFRPSDUHGWRWKHSUHYLRXV\HDU
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
%&,$%
ZZZEFLFRPVD
x Recent developments
2Q1RYHPEHU%&,DQQRXQFHGWKDWLWKDGUHVXPHGRSHUDWLRQVDWLWV
&KORULQH*DV8QLWIURP1RYHPEHU2SHUDWLRQVDWWKHXQLWZHUH
FHDVHGDIWHUFLYLOGHIHQVHUHTXHVWHGWKHFRPSDQ\WRHQVXUHWKDWDOOVDIHW\
PHDVXUHVZHUHLQSODFH
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3%[
36[
'LY<LHOG
'36
3([
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0 D\
6HS
-DQ
7$ 6,
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
$OL$O$EGXOODK$O7DPLPL&R
$EGXO$]L]0$EGXO$]L]$OPRDLEHG
$EGXOODK0$EGXO$]L]$OPRDLEHG
0RKDPPHG$EGXO5DKPDQ$O
6DDG$O%XZDUGL&R
1RRU0XKDQD$EGXO$]L]$OPRDLEHG
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
0 D\
% &,5+6
6RXUFH7DGDZXO1&%&5HVHDUFK
176
,1'8675,$/,19(670(17~0$<
1$7,21$/0(7$/
$/62.12:1$61$70(7$/0$$'$1,<$+
National Metal Mfg & Casting (Maadaniyah) is the largest
manufacturer of steel wire and other wire products in Saudi
Arabia. The company has two plants ± a plant in Jubail
Industrial City and a plant in Dammam. The plants are
equipped with modern machinery for wire drawing, stranding,
galvanizing, and manufacturing fasteners. Maadaniyah¶V
brands include Aslak, Mahawer and Masabik.
NOT COVERED
Current price (SR)
29.8
3ULFLQJDVRI
STOCK DETAILS
x Business brief
0DDGDQL\DKKDVWKHFDSDFLW\WRSURGXFHWRQVRIFDVWLQJV
XQLWVRID[OHVDQGWRQVRIVWHHOZLUHVHDFK\HDU7KHFRPSDQ\
VSHFLDOL]HVLQWKHPDQXIDFWXUHRIORZUHOD[DWLRQ3&VWUDQGVKLJKORZ
JDOYDQL]HGVWHHOFDUERQZLUHVVWUDQGVPDWWUHVVVSULQJZLUHVIDVWHQHUV
ZHOGLQJZLUHVDQGVWHHOQDLOV7KHVHSURGXFWVDUHXVHGLQYDULRXVVHFWRUV
VXFKDVFRQVWUXFWLRQDSSOLDQFHVHOHFWULFDOFDEOHEXLOGLQJV\VWHPVDQGVWHHO
IDEULFDWLRQ
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
x Financials
0DDGDQL\DK¶VUHYHQXHLQFUHDVHG<R<WR65PQLQ(%,7'$
IHOO<R<WR65PQGXHWRKLJKHUUDZPDWHULDOFRVW1HWLQFRPH
GHFUHDVHG<R<WR65PQGXHWRKLJKUHVHDUFKH[SHQVHVRQH[SORULQJ
QHZLQYHVWPHQWRSSRUWXQLWLHV
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
100&&$%
ZZZPDDGDQL\DKFRP
x Recent developments
2Q0DUFKWKH&0$%RDUGDSSURYHG0DDGDQL\DK¶VUHTXHVWWR
LQFUHDVHLWVFDSLWDOIURP65PQWR65PQE\LVVXLQJRQHERQXV
VKDUHIRUHYHU\H[LVWLQJVKDUHVRZQHGE\WKHVKDUHKROGHUV7KLVZRXOGEH
IXQGHGE\WUDQVIHUULQJ65PQIURPWKHVWDWXWRU\UHVHUYHDFFRXQWDQG
65PQIURPUHWDLQHGHDUQLQJVDFFRXQWWRWKHFRPSDQ\
VFDSLWDO
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
3([
09A
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0 D\
6HS
7$ 6,
-DQ
0 D\
0 DDGDQL\DK5+6
TOP 5 SHAREHOLDERS (%)
1DWLRQDO0DQXIDFWXULQJ&RPSDQ\
$KPDG60$O$VHHUL
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
177
,1'8675,$/,19(670(17~0$<
6$8',,1'8675,$/(;3257
$/62.12:1$66$',5$76,(&
Saudi Industrial Export Co. (SIEC) exports, imports and
distributes agricultural goods, industrial products and bulk
commodities. SIEC, which operates through its associates
across the globe, has exported over 10 million tons of
products to more than 40 markets. The FRPSDQ\¶VNH\trading
markets include Europe, Asia, and Africa.
x Business brief
NOT COVERED
Current price (SR)
44.2
3ULFLQJDVRI
6,(&WUDGHVLQEXONIRRGSURGXFWVLQFOXGLQJULFHPDL]HVXJDUDQGHGLEOH
STOCK DETAILS
RLOVIHUWLOL]HUVPLQHUDOVFKHPLFDOVDQGSHWURFKHPLFDOVLURQVWHHODQGRWKHU ZHHNUDQJH+/65
PHWDOVDQGDLUFRQGLWLRQHUVWUXFNVDQGFDEOHV7KHFRPSDQ\RIIHUVYDULRXV
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
VHUYLFHVWRLWVVXSSOLHUVDQGFXVWRPHUVLQFOXGLQJJXDUDQWHHGSD\PHQWV
DUPVOHQJWKPDUNHWLQJILQDQFLQJDQGORJLVWLFVIRUODQGDQGVHDWUDQVSRUW
Price perform (%) 1M
6,(&LVLQYHVWLQJLQGLVWULEXWLRQFKDQQHOVDQGZDUHKRXVLQJIDFLOLWLHVWRUHDFK
$EVROXWH
PRUHPDQXIDFWXUHUVDQGFXVWRPHUV
0DUNHW
6HFWRU
x Financials
6,(&¶VUHYHQXHVJUHZ<R<WRPQLQGXHWRKLJKHUVDOHV
YROXPHV(%,'7$JUHZ<R<WR65PQGXULQJWKH\HDUPDLQO\GXH
WRUREXVWLQFUHDVHLQSURILWPDUJLQIURPWKHVDOHRIUDZPDWHULDOVIRUIHUWLOL]HUV
LQWKH&KLQHVHPDUNHW1HWLQFRPHURVHWR65PQLQIURP65PQ
WKHSUHYLRXV\HDUPDLQO\GXHWRDQLQFUHDVHLQRWKHULQFRPHIURPWKH
WUDQVIHURIVKLSSLQJSURYLVLRQV
x Recent developments
3M
12M
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6,(&2$%
ZZZVLHFFRPVD
WEIGHTING & FREEFLOAT (%)
7KHFRPSDQ\DSSRLQWHG0U6XOHLPDQ%LQ$EGXO0RKVHQ8ZD\GDV*HQHUDO
0DQDJHUDVRI0D\
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
3([
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
2009
2010
2011
YoY
(%)
10
CAGR (%)
(08-11)
10
0 D\
6HS
7$ 6,
-DQ
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
,EUDKLP2XGDK$EGXOODK$O
2XGDK
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
0 D\
6,(&25+6
6RXUFH7DGDZXO1&%&5HVHDUFK
178
,1'8675,$/,19(670(17~0$<
),//,1*$1'3$&.,1*
$/62.12:1$6),3&2
Filling & Packing Materials Manufacturing Company (FIPCO)
produces bags and other woven polypropylene packaging
SURGXFWVIRULQGXVWULDODQGDJULFXOWXUDOXVH7KHFRPSDQ\¶V
production facilities located in Riyadh cover an area of 75,000
sq. meters. FIPCO manufactures over 2mn jumbo bags
annually.
x Business brief
NOT COVERED
Current price (SR)
40.8
3ULFLQJDVRI
),3&2¶VSURGXFWVLQFOXGHMXPEREDJVZLWKFDSDFLWLHVUDQJLQJIURPWR
NJFRQWDLQHUOLQHUVXVHGLQGU\FDUJRVKLSSLQJDQGVOLQJEDJVLQ
YDU\LQJVL]HV7KHFRPSDQ\DOVRSURGXFHVOHQREDJVIRUSDFNLQJIUHVK
YHJHWDEOHVDQGIUXLWVFDEOHILOOHUVIRUHOHFWULFFDEOHPDQXIDFWXUHUVIDEULFVIRU
ILUHUHWDUGDQWVWHQWVDQGOXPEHUSURWHFWLRQVWUDSSLQJEDQGVXVHGIRUER[HV
DQGDJULFXOWXUHDQGEDOHUWZLQHVIRUJUHHQKRXVHVDQGJUDVVEDOLQJ
x Financials
),3&2¶VUHYHQXHMXPSHGWR65PQLQ(%,7'$IHOOWR
65PQGXHWRDQLQFUHDVHLQZDJHVDQGVDODULHV)XUWKHUPRUHORZSULFHG
ORQJWHUPFRQWUDFWVDQGLQFUHDVHGUDZPDWHULDOSULFHVH[HUWHGGRZQZDUG
SUHVVXUHRQSURILWDELOLW\1HWLQFRPHIRUWKH\HDUIHOOWR65PQ
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
x Recent developments
,Q2FWREHUWKHFRPSDQ\VLJQHGDVHYHQ\HDUORDQDJUHHPHQWZLWK
6DXGL,QGXVWULDO'HYHORSPHQW)XQGIRU65PQ7KHORDQZRXOGEHXWLOL]HG
IRUWKHH[SDQVLRQRIDEDJSODQWZRUWK65PQ7KHFRPSDQ\SODQVWR
IXQGWKHUHVWWKURXJKLQWHUQDODFFUXDOV
6(
%ORRPEHUJFRGH
),3&2$%
ZZZILSFRFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
20010
2011
YoY
(%)
CAGR (%)
(08-11)
0 D\
6HS
7$ 6,
-DQ
0 D\
),3 &25+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
6RXUFH7DGDZXO1&%&5HVHDUFK
179
,1'8675,$/,19(670(17~0$<
7$.:((1$'9$1&(',1'8675,(6
$/62.12:1$67$.:((1
NOT COVERED
Takween Advanced Industries Co. (TAKWEEN), formerly AlOthman Plastic Products Co., was established in 1993. The
Current price (SR) 52.0
company specializes in the production of high quality
packaging for the diary and beverage industries in Saudi
3ULFLQJDVRI
Arabia and the Middle East. In early 2010, TAKWEEN acquired
Advanced Fabrics (SAAF), a non-woven fabrics manufacturer,
and Ultrapak, a PET preforms manufacturer. The company
went public in January 2012 with an IPO of 9mn shares,
STOCK DETAILS
accounting for 30% of the total shares outstanding.
ZHHNUDQJH+/65
0DUNHWFDSPQ
x Business brief
7$.:((1KDVWKUHHEXVLQHVVVHJPHQWV3ODVWLF3DFNDJLQJ3(73UHIRUPV
DQG1RQZRYHQ)DEULFV3ODVWLF3DFNDJLQJLQFOXGHVSRO\VW\UHQHVKHHWV
WKHUPRIRUPHGSRO\VW\UHQHDQGKLJKGHQVLW\SRO\HWK\OHQH+'3(XVHG
PDLQO\LQWKHGDLU\IRRGDQGEHYHUDJHLQGXVWULHV3UHIRUPVDUHSRO\PHUVVROG
WRERWWOHUVIRUSURGXFLQJERWWOHV1RQZRYHQ)DEULFVLQFOXGHVVSXQERQG
PHOWEORZQDQGFRPSRVLWHIDEULFVZKLFKDUHXVHGLQK\JLHQHSURGXFWV
LQGXVWULDODQGPHGLFDODSSOLFDWLRQV
x Financials
7KHFRPSDQ\¶VQHWVDOHVIRUJUHZ<R<WR65PQ(%,7'$
PDUJLQGHFOLQHGWRIURPLQGXHWRKLJKHUFRVWRIJRRGV
VROG1HWSURILWLQFUHDVHG<R<WR65PQGXULQJWKH\HDUKRZHYHU
QHWPDUJLQGHFOLQHGPDUJLQDOO\WRIURPLQ
x Recent developments
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
7$.:((1$%
ZZZWDNZHHQDLFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
2Q0DUFK7$.:((1DQQRXQFHGDFDVKGLYLGHQGRIRU
65SHUVKDUHIRU
12M
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
2009
1$
2010
1$
2011
YoY
(%)
CAGR (%)
(09-11)
)HE
0DU
7$6,
$SU
0D\
7DNZHHQ5+6
TOP 5 SHAREHOLDERS (%)
$O2WKPDQ+ROGLQJ
6DOHK$EGXOD]L]$O5DMKLDQG
3DUWQHUV
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
180
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Building & Construction
Ticker
Company
Page No.
1320
SSP
185
2040
Saudi Ceramics
186
2160
Amiantit
187
2240
Zamil Ind
188
1310
MMG
189
2320
Al Babtain
190
2110
Saudi Cables
191
2200
Arabian Pipes
192
1330
Abdullah A M Al Khodari Sons Co
193
2130
SIDC
194
2090
National Gypsum
195
4230
Red Sea Housing
196
2360
SVCP
197
2370
MESC
198
1301
United Wire Factories
199
0$<
%8,/',1*&216758&7,21
6WURQJRXWORRN±)RFXVRQUHVLGHQWLDOFRQVWUXFWLRQ
6DXGL$UDELDLVWKHELJJHVWFRQVWUXFWLRQPDUNHWLQWKH0(1$
UHJLRQ7KH.LQJGRP¶VFRQVWUXFWLRQVHFWRUUHFRYHUHGVLJQLILFDQWO\
DIWHUDVORZGRZQLQ7KLVZDVSULPDULO\GXHWRWKH
H[SDQVLRQDU\JRYHUQPHQWSROLFLHVDJURZLQJSRSXODWLRQDQGD
UHVLOLHQWHFRQRP\'HVSLWHPDQ\FKDOOHQJHVVXFKDVLQFUHDVHG
FRPSHWLWLRQDQGSULFHZDUVZHEHOLHYHFRQVWUXFWLRQFRPSDQLHV
SHUIRUPHGZHOOLQ
7KHUHVLGHQWLDOFRQVWUXFWLRQPDUNHWLQ6DXGL$UDELDVWUHQJWKHQHGLQDVWKH
IRFXVVKLIWHGWRDIIRUGDEOHKRXVLQJ6HYHUDOQHZDIIRUGDEOHKRXVLQJSURMHFWV
LQFOXGLQJWKHJRYHUQPHQW¶VDLPWREXLOGKRXVLQJXQLWVKDYHEHHQ
LQLWLDWHGWRDGGUHVVWKHVWURQJVXSSO\JDSLQORZLQFRPHKRXVLQJXQLWV
0HDQZKLOHWKHFRPPHUFLDOFRQVWUXFWLRQVHJPHQWKDVUHFRYHUHGGXHWRORZ
LQWHUHVWUDWHVKLJKOLTXLGLW\DQGDJURZLQJHFRQRP\7KH6DXGL$UDELDQ
JRYHUQPHQWFRQWLQXHGWRLQYHVWKHDYLO\RQLQIUDVWUXFWXUHWRSURPRWHHPSOR\PHQW
DQGGLYHUVLI\WKHHFRQRP\&XUUHQWO\IRXUQHZHFRQRPLFFLWLHVDUHEHLQJ
GHYHORSHGLQ6DXGL$UDELDZKLFKZHEHOLHYHZRXOGEHQHILWFRQVWUXFWLRQUHODWHG
FRPSDQLHV
7KH7DGDZXOOLVWHGFRPSDQLHVXQGHUWKHEXLOGLQJFRQVWUXFWLRQVHFWRUUHFRUGHG
DVWURQJSHUIRUPDQFHLQZLWKUHYHQXHVLQFUHDVLQJVLJQLILFDQWO\FRPSDUHG
WR+RZHYHUWKHVHFWRU¶V52(VWRRGDWLQZKLFKZHEHOLHYHLV
UHJDUGHGORZZKHQFRPSDUHGWRWKH*&&SHHUDYHUDJHRI
Exhibit 110: Revenues of GCC building & construction
companies, 2009±11
Exhibit 111: Comparison of ROE and P/E of GCC
companies, 2011
86'PQ
3(
.6$
8$(
6RXUFH=DZ\D7DGDZXO1&%&5HVHDUFK
.XZDLW
2PDQ
52(
.6$
8$(
.XZDLW
2PDQ
6RXUFH=DZ\D7DGDZXO1&%&5HVHDUFK
7KHEXLOGLQJFRQVWUXFWLRQVHFWRULQ6DXGL$UDELDLVUHODWLYHO\GLYHUVLILHGZLWK
WKHSUHVHQFHRIOLVWHGFRPSDQLHV7KHVHFRPSDQLHVLQWRWDODFFRXQWIRU
RIWKH7$6,¶VZHLJKWLQWHUPVRIIUHHIORDW6DXGL&HUDPLF&RDQG6DXGL$UDELDQ
$PLDQWLW&RZLWKDZHLJKWRIHDFKKDYHWKHODUJHVWZHLJKWRQWKHLQGH[
182
%8,/',1*&216758&7,21
1&%&$3,7$/
0$<
Exhibit 112: Sector details
8QLWVDVVWDWHG
% weight in Index
as on 28 Mar 2012
Country
6DXGL&HUDPLF&R
6DXGL$UDELDQ$PLDQWLW&R
=DPLO,QGXVWULDO,QYHVWPHQW&R
$/%DEWDLQ3RZHU7HOHFRPPXQLFDWLRQ&R
6DXGL,QGXVWULDO'HYHORSPHQW&R
6DXGL&DEOH&RPSDQ\
0RKDPPDG$O0RMLO*URXS
$UDELDQ3LSHV&RPSDQ\
$EGXOODK$0$O.KRGDUL6RQV&R
0LGGOH(DVW6SHFLDOL]HG&DEOHV&R
1DWLRQDO*\SVXP&RPSDQ\
6DXGL6WHHO3LSH&RPSDQ\
6DXGL9LWULILHG&OD\3LSHV&R
5HG6HD+RXVLQJ
8QLWHG:LUH)DFWRULHV&RPSDQ\
NIM (%),
2011
Avg. RoE (%),
2011
6RXUFH%ORRPEHUJ7DGDZXO&RPSDQ\GDWD
7KHVHFWRU¶VSHUIRUPDQFHLPSURYHG<R<5HYHQXHVLQFUHDVHGDSSUR[LPDWHO\
WR86'EQLQIURP86'EQLQ+RZHYHUWKHVHFWRU¶VQHW
SURILWIHOOWR86'PQLQIURP86'PQLQ0RKDPPHG$O0RMLO
ZKLFKUHFRUGHGDVLJQLILFDQWORVVRI86'PQLQKDVEHHQH[FOXGHG
IURPWKHILJXUHIRUIDLUFRPSDULVRQ
Exhibit 113: Revenues of companies, 2009±11
Exhibit 114: Profitability of SSP relative to sector
average (2009±11)
65PQ
$PLDQWLW
$OEDEWDLQ
=DPLO
0RKDPHG $O0RMLO
6RXUFH=DZ\D7DGDZXO1&%&5HVHDUFK
6SH FLD OL]H G&DEO HV
6DX GL6 WHH O3 LSH
6DX GL&DE OH&R
6HFWRU$YH UDJH
6DX GL6 WHH O3 LSH
6RXUFH=DZ\D7DGDZXO1&%&5HVHDUFK
7KHVHFWRU¶V3(DQG3%9PXOWLSOHVVWRRGDW[DQG[UHVSHFWLYHO\LQ
YHUVXV[DQG[UHVSHFWLYHO\LQ6DXGL9LWULILHG&OD\3LSH
&RPSDQ\UHFRUGHGWKHKLJKHVW52(RIZKLOH0RKDPPHG$O0RMLO*URXS
UHSRUWHGWKHORZHVW52(RIGXULQJWKHVDPHSHULRG
183
%8,/',1*&216758&7,21
1&%&$3,7$/
0$<
Exhibit 115: Comparison of P/B and ROE, 2010
Exhibit 116: Comparison of P/B and ROE, 2011
$O.KRGDUL
6RQV&R
6,'&
=DPLO
=DPLO
6DXGL&HUDPLFV
5HGVHD
$OEDEWDLQ
6DXGL9LWULILHG
$PLDQWLW
*\SVXP
$UDELDQ SLSHV
6DXGL&DEOH
&R
0RKDPHG$O
0RMLO
5HGVHD
6DXGL&HUDPLFV
6DXGL6WHHO
3LSH
$PLDQWLW
$OEDEWDLQ
8QLWHGZLUH
8QLWHGZLUH
6DXGL&DEOH
&R
6DXGL9LWULILHG
6,'&
6DXGL6WHHO
$UDELDQ SLSHV 3LSH
6SHFLDOL]HG
&DEOHV
*\SVXP
$O.KRGDUL
6RQV&R
6SHFLDOL]HG
&DEOHV
0RKDPHG$O
0RMLO
6RXUFH=DZ\D7DGDZXO1&%&5HVHDUFK
6RXUFH=DZ\D7DGDZXO1&%&5HVHDUFK
:HEHOLHYHWKHRXWORRNIRUWKH.6$¶VEXLOGLQJFRQVWUXFWLRQPDUNHWLVSRVLWLYH
7KHWRWDOYDOXHRIFRQWUDFWVDZDUGHGLVH[SHFWHGWRLQFUHDVHDWD&$*5RI
WR86'EQE\IURP86'EQLQ7KHLQWURGXFWLRQRIWKHQHZ
PRUWJDJHODZFXUUHQWO\XQGHUWKH.LQJ¶VFRQVLGHUDWLRQLVH[SHFWHGWRGULYHWKH
GHPDQGIRUKRXVLQJIDFLOLWLHV,QWKH.LQJGRPFRPPLWWHGWRVSHQGDERXW
86'EQRQODUJHLQIUDVWUXFWXUHSURMHFWVRYHUWKHQH[WILYH\HDUV$GGLWLRQDOO\
WKH86'EQKRPHEXLOGLQJIXQGE\WKHJRYHUQPHQWLVH[SHFWHGWRSURYLGHDQ
RSSRUWXQLW\IRUWKHEXLOGLQJFRQVWUXFWLRQFRPSDQLHV
1&%&5HFRPPHQGDWLRQVLQWKH6HFWRU
:HDUHFRYHULQJ6DXGL6WHHO3LSHV663LQWKHEXLOGLQJVFRQVWUXFWLRQVHFWRU
:HDUHFXUUHQWO\QHXWUDORQWKHVWRFN
Exhibit 117: Coverage stocks details
Stock
Current Rating
6DXGL6WHHO3LSHV 1HXWUDO
6(
PT (SR)
Comments
,QFUHDVLQJGHPDQGIRUFRQVWUXFWLRQSURMHFWVDQGKLJKHUVDOHVYROXPHIURPWKH
VPDOOGLDPHWHUVHJPHQWWKDW\LHOGKLJKHUPDUJLQVZRXOGGULYHUHYHQXHV
+RZHYHUOLPLWHGGHPDQGIRUPHGLXPGLDPHWHUVHJPHQWDQGSUHVVXUHRQLWV
PDUJLQVUHPDLQDNH\FRQFHUQ:HEHOLHYHWKDWSRVLWLYHIDFWRUVKDYHDOUHDG\
EHHQSULFHGLQWKHFXUUHQWYDOXDWLRQOHDYLQJOLPLWHGXSVLGHSRWHQWLDOIURP
FXUUHQWOHYHOV
6RXUFH1&%&5HVHDUFK
184
&216758&7,21~0$<
6$8',67((/3,3(6
$/62.12:1$6663
6DXGL6WHHO3LSH&RPSDQ\663HVWDEOLVKHGLQ
PDQXIDFWXUHVZHOGHGVWHHOSLSHVJDOYDQL]HGDQGQRQ
JDOYDQL]HGSLSHVFDUERQVWHHOWXEHVDQGDQJXODUWXEHV7KH
FRPSDQ\VHOOVSURGXFWVLQWKHGRPHVWLFPDUNHWDQGH[SRUWV
WRQHDUO\FRXQWULHV
1(875$/
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
663PDQXIDFWXUHVEODFNDQGJDOYDQL]HGSLSHVLQVPDOODQGPHGLXPGLDPHWHU
VL]HVDQGFDWHUVWRWKHFRQVWUXFWLRQUHDOHVWDWHDQGRLOJDVPDUNHWV7KH 672&.'(7$,/6
VPDOOGLDPHWHUSURGXFWLRQFDSDFLW\LVWRQVSHU\HDUZKLOHWKDWRI
ZHHNUDQJH+/65
PHGLXPGLDPHWHULVWRQVSHU\HDU7KHFRPSDQ\LVDOVRH[SDQGLQJ
0DUNHWFDSPQ
LQWKHODUJHGLDPHWHUSLSHVPDUNHWWKURXJKDVWDNHLQDQXQGHU
6KDUHVRXWVWDQGLQJPQ
FRQVWUXFWLRQSODQWLQ-XEDLO7KHSODQWZRXOGKDYHDFDSDFLW\RIWRQV
3ULFHSHUIRUP 0
SHU\HDUDQGLVVFKHGXOHGWRFRPPHQFHLQ
$EVROXWH
x )LQDQFLDOV
5HYHQXHVJUHZWR65PQLQIURP65PQLQGXHWR
KLJKHUVDOHVYROXPHV7KHWRWDOTXDQWLW\GHOLYHUHGKDVLQFUHDVHG<R<
WRWKRXVDQGWRQV7KHDGMXVWHGQHWLQFRPHGHFOLQHG<R<WR
65PQLQGXHWRDQLQFUHDVHLQUDZPDWHULDOFRVWVDQGORZPDUJLQRQ
VDOHV:HH[SHFWQHWSURILWWRLQFUHDVHVLJQLILFDQWO\<2<LQGXHWRD
QRQUHFXUULQJH[SHQVHZKLFKWKHFRPSDQ\UHFRUGHGLQDVZHOODVWKH
LQFUHDVHLQWKHFRPSDQ\¶VILQDQFLQJFRVWV
0
0
0DUNHW
6HFWRU
65
86
$YJGDLO\WXUQRYHUPQ
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
663$%
ZZZVVSLSHFRP
x 5HFHQWGHYHORSPHQWV
:(,*+7,1*)5(()/2$7
2Q$SULOWKHFRPSDQ\DQQRXQFHGWKDWLWVLJQHGD65PQFRQWUDFW
WRSXUFKDVHZHOGHGSLSHSURGXFWLRQPDFKLQHVIRULWVQHZIDFWRU\LQ
'DPPDQ
VVHFRQGLQGXVWULDOFLW\ZLWK6XLWKH*HUPDQ\DQG0D\HU5HVHDUFK
*URXS,WDO\
7$6,IUHHIORDWZHLJKW
)UHHIORDW
2Q)HEUXDU\WKHFRPSDQ\UHFHLYHGD65PQSXUFKDVHRUGHUWR
SURYLGH*6(QJLQHHULQJ&RQVWUXFWLRQ&RPSDQ\6RXWK.RUHDZLWK(5:
SLSHVWREHXVHGLQ.XZDLW2LO&RPSDQ\
VSURMHFWLQ:DUDZKLFKZRXOGEH
GHOLYHUHGGXULQJ47KHFRPSDQ\DOVRVDLGWKDWWKHUDZPDWHULDOVWREH
XVHGZRXOGEHSURYLGHGE\6DXGL%DVLF,QGXVWULHVE\WKHHQGRI4
3([
9$/8$7,2108/7,3/(6
$
$
(
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
&RPSDQ\ILQDQFLDOV
5HYHQXHV
65PQ
(%,7'$
65PQ
$GMXVWHG1HW,QFRPHA 65PQ
$VVHWV
65PQ
(TXLW\
65PQ
7RWDO'HEW
65PQ
&DVK(TXLY
65PQ
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
65
%936
65
(
(
<R<
&$*5
(
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
A663UHSRUWVQHWLQFRPHEHIRUHGHGXFLQJ=DNDWDQGWD[HV:HSUHVHQWWKHDGMXVWHGQHWLQFRPHKHUHDIWHUGHGXFWLQJ=DNDWDQG
WD[HV
0D\
6HS
7$6,
-DQ
0D\
6635+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
5DELDKDQG1DVVDU*URXS
+XJK6WHHO&RPSDQ\/WG
$EGXOOD,EUDKLP$O.KDUHHI
6RQV&R
6RXUFH7DGDZXO1&%&5HVHDUFK
185
&216758&7,21~0$<
6$8',&(5$0,&
$/62.12:1$66&&
5L\DGKEDVHG6DXGL&HUDPLF&RPSDQ\6&&PDQXIDFWXUHV
DQGPDUNHWVFHUDPLFZDOODQGIORRUWLOHVFHUDPLFURDG
PDUNHUVVDQLWDU\ZDUHDQGHOHFWULFZDWHUKHDWHUV7KH
FRPSDQ\HVWDEOLVKHGLQKDVILYHRIILFHVLQ6DXGL$UDELD
DQGRQHLQ'XEDL
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
6&&KDVFRQWLQXDOO\HQKDQFHGLWVSURGXFWLRQFDSDFLW\WRPHHWWKHJURZLQJ
GHPDQGIRUFHUDPLFVDQGUHODWHGSURGXFWV7KHFRPSDQ\¶VPDQXIDFWXULQJ
672&.'(7$,/6
XQLWVLQ5L\DGK,QGXVWULDO&LW\DUHVSUHDGRYHUPLOOLRQVTXDUHPHWHUVDQG
ZHHNUDQJH+/65
FRPSULVHIRXUWLOHIDFWRULHVRQHVDQLWDU\ZDUHIDFWRU\WZR)ULWSODQWVDQGWZR 0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
HOHFWULFZDWHUKHDWHUIDFWRULHV7KHFRPSDQ\¶VSURGXFWRIIHULQJVHQFRPSDVV
WLOHVSRUFHODLQFHUDPLFDQGGHFRUDWHGVTXDULQJDQGFKDPIHULQJXQLWV
3ULFHSHUIRUP 0
VDQLWDU\ZDUHHOHFWULFZDWHUKHDWHUVDQGFHUDPLFURDGPDUNHUV
$EVROXWH
x )LQDQFLDOV
6&&¶VUHYHQXHVJUHZ<R<WR65PQLQ7KLVZDVPDLQO\
GXHWRLQFUHDVHGSURGXFWLRQDVDQHZSODQWVWDUWHGPDQXIDFWXULQJDQGPDGH
DQHQWU\LQWRQHZPDUNHWVLQWKH.6$DQGDEURDG(%,7'$IRUWKH\HDU
LQFUHDVHG<R<WR65PQZKLOHQHWLQFRPHURVH<R<WR
65PQ
2Q$SULOWKH%RDUGDW(*0DSSURYHGDQLQFUHDVHLQVKDUHFDSLWDO
IURP65PQWR65PQGLVWULEXWLQJERQXVVKDUHVLQWKHUDWLRRI
2Q)HEUXDU\WKHFRPSDQ\DQQRXQFHGWKDWLWKDGVLJQHGDVL[
PRQWKVPHPRUDQGXPRIXQGHUVWDQGLQJZLWK)XWXUH&HUDPLFDQG3RUFHODLQ
&RPSDQ\WRHYDOXDWHWKHSRVVLELOLW\RIDPHUJHUEHWZHHQWKHWZRFRPSDQLHV
2Q)HEUXDU\WKH%RDUGDSSURYHGWKHDGGLWLRQRIDQHZFHUDPLFWLOH
SURGXFWLRQOLQHZLWKDFDSDFLW\RIPLOOLRQVTXDUHPHWHUV7KHSODQWLV
H[SHFWHGWREHFRPSOHWHGE\WKHVWDUWRIZLWKDWRWDOFRVWRI65PQ
2QFRPSOHWLRQWKHWRWDODQQXDOSURGXFWLRQFDSDFLW\RIWKHFRPSDQ\
VWLOH
SODQWVLVH[SHFWHGWRUHDFKPLOOLRQVTXDUHPHWHUV
0
0
0DUNHW
6HFWRU
65
86
$YJGDLO\WXUQRYHUPQ
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
6&(5&2$%
ZZZVDXGLFHUDPLFVFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
-DQ
7$6,
0D\
&HUDPLF5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6DOHK$EGXO$]L]6DOHK$O5DMKL )DOFRP)LQDQFLDO6HUYLFHV&R 3XEOLF,QYHVWPHQW)XQG
6RXUFH7DGDZXO1&%&5HVHDUFK
186
&216758&7,21~0$<
$0,$17,7&203$1<
$/62.12:1$6$0,$17,7*52836$$&
6DXGL$UDELDQ$PLDQWLW&RPSDQ\6$$&ZDVHVWDEOLVKHGLQ
WRPDQXIDFWXUHSLSHVIRUWKHORFDOPDUNHW7KH
FRPSDQ\¶VFRUHEXVLQHVVDFWLYLWLHVLQFOXGHWKHPDQXIDFWXUH
DQGVDOHRISLSHV\VWHPVRZQHUVKLSDQGVDOHVRISLSH
WHFKQRORJLHVZDWHUPDQDJHPHQWFRQVXOWDQF\DQG
HQJLQHHULQJVHUYLFHVDQGPDQXIDFWXUHDQGVXSSO\RISRO\PHU
SURGXFWV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
6$$&KDVSLSHV\VWHPPDQXIDFWXULQJSODQWVVL[WHFKQRORJ\FRPSDQLHV
IRXUPDWHULDOVXSSOLHUVDQGHLJKWVXSSO\DQGHQJLQHHULQJVXEVLGLDULHV7KH
FRPSDQ\VHUYHVWKHZRUOGZLGHPXQLFLSDOFLYLOHQJLQHHULQJLQGXVWULDOHQHUJ\
DQGDJULFXOWXUDOPDUNHWVWKXVLWVXSSRUWVJOREDOLQIUDVWUXFWXUHGHYHORSPHQW
WKURXJKDQH[WHQVLYHVDOHVDQGVHUYLFHQHWZRUNLQPRUHWKDQFRXQWULHV
x )LQDQFLDOV
6$$&¶VUHYHQXHVLQFUHDVHG<R<LQWR65PQPDLQO\GXHWR
WKHLQFUHDVHLQSURGXFWLYLW\(%,7'$PDUJLQVIRUGHFOLQHGWR
IURPLQ1HWLQFRPHGURSSHG<R<WR65PQLQ
GXHWRORZHUVHOOLQJSULFHVDPLGLQFUHDVHGFRPSHWLWLRQ
x 5HFHQWGHYHORSPHQWV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
2Q0DUFKWKHFRPSDQ\DQQRXQFHGWKHVWDUWRIDWULDORIZDWHU
GHOLYHU\DQGVDQLWDWLRQVHUYLFHVLQWKH,QGXVWULDO&LW\LQ5L\DGKGXULQJ4
DQGLWH[SHFWVWRVWDUWWKHFRPPHUFLDORSHUDWLRQVE\WKHHQGRI
)XUWKHUPRUHWKHFRPSDQ\H[SHFWVWRVWDUWSURYLGLQJWKHVHVHUYLFHVLQWKH
,QGXVWULDO&LW\DW$O4DVVLPLQ$SULO
6(
%ORRPEHUJFRGH
6$$&$%
ZZZDPLDQWLWFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
7KHFRPSDQ\WKURXJKLWVIXOO\RZQHGVXEVLGLDU\$PL:DWHUKDVHQWHUHG
LQWRDMRLQWYHQWXUHZLWK3:7*HUPDQ\WRHVWDEOLVKDQHZFRPSDQ\
3:7/LPLWHG6DXGL$UDELDZLWKDFDSLWDORI65PQ7KHODWWHUZRXOG
HVWDEOLVKRSHUDWHDQGPDLQWDLQZDWHUWUHDWPHQWSODQWV
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6+$5(35,&(3(5)250$1&(
<R<
&$*5
0D\
6HS
7$6,
-DQ
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$O0DZDULG,QYHVWPHQW&R/WG
3ULQFH.KDOLGELQ$EGXOODKELQ
$EGXO5DKPDQ$O6DXG $EGXOODK6DOHK$EGXOODK$/
%DVVDP
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
0D\
$PLDQWLW5+6
6RXUFH7DGDZXO1&%&5HVHDUFK
3OHDVHUHIHUWRWKHODVWSDJHIRULPSRUWDQWGLVFODLPHU
ZZZQFEFFRP
187 &216758&7,21~0$<
=$0,/,1'8675,$/
$/62.12:1$6=,,&
=DPLO,QGXVWULDO,QYHVWPHQW&R=,,&HVWDEOLVKHGLQDQG
KHDGTXDUWHUHGLQ'DPPDPLVDPDQXIDFWXULQJDQG
IDEULFDWLRQJURXSVHUYLQJWKHFRQVWUXFWLRQLQGXVWU\,WPDLQO\
RSHUDWHVLQWKHVWHHO+9$&JODVVLQVXODWLRQDQGFRQFUHWH
VHFWRUV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
=,,&KDVPDQXIDFWXULQJSODQWVDQGRIILFHVLQFRXQWULHVLWH[SRUWVSURGXFWV
WRRYHUPDUNHWVJOREDOO\7KHFRPSDQ\RIIHUVSURGXFWVVXFKDVDLU
672&.'(7$,/6
FRQGLWLRQLQJSUHHQJLQHHUHGVWHHOEXLOGLQJVSURFHVVHTXLSPHQW
ZHHNUDQJH+/65
WUDQVPLVVLRQWRZHUVSURFHVVHGDUFKLWHFWXUDOJODVVDQGRWKHUVROXWLRQVWRWKH
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
JOREDOFRQVWUXFWLRQLQGXVWU\,WRSHUDWHVWKURXJK=DPLO$LU&RQGLWLRQHUV
=$&=DPLO6WHHO,QGV=6,=DPLO*ODVV,QGXVWULHV=*,DQG$UDELDQ
3ULFHSHUIRUP 0
)LEHUJODVV,QVXODWLRQ&R/WG$),&2
$EVROXWH
x )LQDQFLDOV
=,,&¶VUHYHQXHVJUHZ<R<WR65PQGXHWRDQLQFUHDVHLQ
SURGXFWLRQYROXPHV(%,7'$PDUJLQGHFOLQHGWRLQFRPSDUHGWR
LQPDLQO\GXHWRRQJRLQJFRPSHWLWLRQDQGSUHVVXUHRQVWHHO
SULFHV1HWSURILWIHOOWR65PQRWKHULQFRPHGHFOLQHGDQGILQDQFLDO
H[SHQVHVLQFUHDVHG
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
2Q)HEUXDU\5DELDK1DVVDUDQG=DPLO&RQFUHWH,QGXVWULHVWKH
FRPSDQ\¶VRZQHGVXEVLGLDU\VLJQHGD65PQFRQWUDFWZLWK6DXGL
2JHUWRPDQXIDFWXUHDQGVXSSO\SUHFDVWYLOODVIRUWKH6DXGL$UDELDQ1DWLRQDO
*XDUG+RXVLQJSURMHFW7KHSURMHFWLVH[SHFWHGWREHFRPSOHWHGE\4
2Q6HSWHPEHU=DPLO1HZ'HOKL,QIUDVWUXFWXUH3ULYDWH/LPLWHGWKH
FRPSDQ\¶VRZQHGVXEVLGLDU\ZDVDZDUGHGD65PQFRQWUDFWE\
3/*3KRWRYROWDLF/LPLWHGWRHVWDEOLVKDPHJDZDWWVRODUSODQWIRUWKHODWWHU
ZKLFKZRXOGKDYHDSRVLWLYHLPSDFWRQWKHFRPSDQ\
VILQDQFLDOVWDWHPHQWVLQ
+
=,,&$%
ZZZ]DPLOLQGXVWULDOFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
-DQ
7$6,
0D\
=,,&5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
=DPLO*URXS+ROGLQJ&R
3XEOLF3HQVLRQ$XWKRULW\33$
6RXUFH7DGDZXO1&%&5HVHDUFK
188
&216758&7,21~0$<
02+$00$'$/02-,/
$/62.12:1$600*
0RKDPPDG$O0RMLO*URXS00*SURYLGHVFRQVWUXFWLRQ
VHUYLFHVLQWKH*XOIUHJLRQ7KHFRPSDQ\KDVXQGHUWDNHQ
SURMHFWVPDLQO\LQWKHRLOJDVDQGSHWURFKHPLFDOLQGXVWULHV
00*DOVRRIIHUVPHFKDQLFDOHOHFWULFDOFLYLOVWUXFWXUDODQG
PDLQWHQDQFHVHUYLFHV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
00*LVHQJDJHGLQYDULRXVFRQVWUXFWLRQDQGHQJLQHHULQJSURMHFWVLQFOXGLQJ
RQVKRUHVHUYLFHVVXFKDVFLYLODQGVWUXFWXUDOZRUNDQGPHFKDQLFDODQG
672&.'(7$,/6
HOHFWULFDOVHUYLFHV,WDOVRFRQGXFWVRIIVKRUHDFWLYLWLHVHVSHFLDOO\LQPDULQH
ZHHNUDQJH+/65
SURMHFWVZLWKWKHKHOSRIYDULRXVPDULQHYHVVHOV7KHFRPSDQ\RZQVKHDY\
0DUNHWFDSPQ
PDFKLQHU\LQFOXGLQJWHVWLQJDQGFDOLEUDWLRQIDFLOLWLHVDQGSURYLGHVHTXLSPHQW
6KDUHVRXWVWDQGLQJPQ
VHUYLFHVVXFKDVWHFKQLFDODQGPDLQWHQDQFHVHUYLFHVIRUWXUQNH\SURMHFWV
3ULFHSHUIRUP 0
%HVLGHVWKLVLWRIIHUVVHUYLFHVLQVWHHOIDEULFDWLRQ
$EVROXWH
x )LQDQFLDOV
5HYHQXHIRULQFUHDVHGWR65PQFRPSDUHGWR65PQ
LQ00*UHSRUWHGDQHWORVVRI65PQLQDJDLQVWDORVVRI
65PQLQGXHWRDQLQFUHDVHLQGLUHFWFRVWVLQH[FHVVRIDSSURYHG
EXGJHWVIRUFHUWDLQRQJRLQJSURMHFWV
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
x 5HFHQWGHYHORSPHQWV
6(
00*DQQRXQFHGRQ$SULOWKDWLWUHFHLYHGWKHGHOLYHU\RIWKUHH
YHVVHOVIRULWVIOHHWLQWKH0DULQH6HUYLFHV'HSDUWPHQW7KHVHYHVVHOVZRXOG
EHXVHGWRSURYLGHPDULQHVXSSRUWWRIORDWLQJRLOJDVSODWIRUPVRI$UDPFR
,Q'HFHPEHUWKHFRPSDQ\VLJQHGD\HDU65PQFRQWUDFWZLWK
$UDPFRWRSURYLGHPDULQHVXSSRUWIRURIIVKRUHKRRNXSXSJUDGH
PRGLILFDWLRQLQVWDOODWLRQDQGFRPPLVVLRQLQJRIIORDWLQJSODWIRUPV
%ORRPEHUJFRGH
2Q1RYHPEHU00*FDQFHOHGDMRLQWYHQWXUHSODQQHGLQ0D\
ZLWK$O5XVKDLG3HWUROHXP,QYHVWPHQW&RD6DXGLRLOILHOGVXSSRUWFRPSDQ\
2Q1RYHPEHUWKH%2'RI00*PHWDQGDSSURYHGWKHDSSRLQWPHQW
RI0U,EUDKLP=DGDDVWKHFRPSDQ\
VQHZ3UHVLGHQWDQG&KLHI([HFXWLYH
2IILFHUDVDUHSODFHPHQWWR0U,EUDKLP$O6KXZHLU
$
$
$
3([
10
10
3%[
36[
'LY<LHOG
'36
,Q-XQHWKHFRPSDQ\VLJQHGD65PQOHWWHURILQWHQWZLWK6RXWK
.RUHD
V6.(QJLQHHULQJ&RQVWUXFWLRQ&RWRFDUU\RXWFRQVWUXFWLRQZRUNRQ
WKH:DVLWJDVGHYHORSPHQWSURMHFW
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
10
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK)LQDQFLDOVDUHIRUPRQWKV
<R<
10
10
10
&$*5
10
10
10
00*$%
ZZZDOPRMLOJURXSFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
&RPSDQ\ILQDQFLDOV
0D\
6HS
7$6,
-DQ
0D\
00*5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
0RKDPPHG+DPDG$EGXO.DULP
$O0RDMLO
$GHO0RKDPPHG+DPDG$O0RDMLO
6RXUFH7DGDZXO1&%&5HVHDUFK
189
&216758&7,21~0$<
$/%$%7$,132:(5
$/62.12:1$6$/%$%7$,1
$O%DEWDLQ3RZHUDQG7HOHFRPPXQLFDWLRQ&RPSDQ\$O
%DEWDLQSURYLGHVRXWGRRUOLJKWLQJWUDQVPLVVLRQDQG
GLVWULEXWLRQ7'DQGWHVWLQJVWDWLRQVHUYLFHVWRWKHSRZHU
VHFWRU7KHFRPSDQ\DOVRGHVLJQVPDQXIDFWXUHVDQGLQVWDOOV
VWHHOWRZHUVIRUWKHWHOHFRPPXQLFDWLRQVVHFWRU
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
$O%DEWDLQ¶V7'SRUWIROLRFRPSULVHVWUDQVPLVVLRQWRZHUVRIXSWRN9
PRQRSROHVXSWRN9DQGGLVWULEXWLRQSROHVXSWRN97KHFRPSDQ\¶V
VXEVLGLDU\$O%DEWDLQ/H%/$1&7HOHFRPPXQLFDWLRQVWDNHLVDMRLQW
YHQWXUHZLWK/H%/$1&WKDWSURYLGHVHQJLQHHULQJPDQXIDFWXULQJDQG
LQVWDOODWLRQVHUYLFHVIRUFRPPXQLFDWLRQWRZHUVRIYDULRXVW\SHVLQ6DXGL
$UDELDQHLJKERULQJ$UDEFRXQWULHVDQG1RUWK$IULFDQQDWLRQV$OVR$O
%DEWDLQIRU2SHUDWLRQDQG0DLQWHQDQFHDVXEVLGLDU\RIWKHFRPSDQ\
RSHUDWHVLQWKHSHWURFKHPLFDORLOJDVFHPHQWLQGXVWULDODQGFRPPHUFLDO
VHJPHQWVRIVWUXFWXUDOVWHHOWKXVSURYLGLQJHQJLQHHULQJDQGPDQXIDFWXULQJ
VROXWLRQVIRUYDULHGDSSOLFDWLRQV
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
x )LQDQFLDOV
'HVSLWHDKLJKHUVDOHVYROXPHLQUHYHQXHVLQFUHDVHGPDUJLQDOO\E\
<R<WR65PQGXHWRORZHUVHOOLQJSULFHVDPLGLQFUHDVHG
FRPSHWLWLRQ(%,7'$IHOOWR65PQPDLQO\GXHWRLQFUHDVHGSULFHV
RIUDZPDWHULDO+RZHYHUWKLVZDVPDUJLQDOO\RIIVHWE\PHDVXUHVWDNHQE\
WKHFRPSDQ\WRUHGXFHWKHFRVWRISURGXFWLRQ7KHQHWLQFRPHIRU
GHFUHDVHG<R<WR65PQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$/%$%7$,$%
ZZZDOEDEWDLQFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
x 5HFHQWGHYHORSPHQWV
)UHHIORDW
2Q)HEUXDU\WKHFRPSDQ\DQQRXQFHGWKHDFTXLVLWLRQRIVKDUHV
ZRUWK86'PQLQ4DWDU(QJLQHHULQJDQG&RQVWUXFWLRQ&RPSDQ\PDNLQJ
LWVWRWDOVWDNH86'PQ
2Q)HEUXDU\$O%DEWDLQDQQRXQFHGWKDWLWZRQWKHELG86'PQ
WRIXOO\DFTXLUH3HWLWMHDQ6$6D)UHQFKFRPSDQ\WKDWGHVLJQVPDQXIDFWXUHV
DQGGLVWULEXWHVRXWGRRUOLJKWQLQJDQGSRZHUWUDQVPLVVLRQV\VWHPV7KLV
DFTXLVLWLRQLVH[SHFWHGWRFRQWULEXWHLQUHYHQXHVDQGWRQHWLQFRPH
IURPWKHWKLUG\HDU
0
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
$/%DEWDLQ5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
6RXUFH7DGDZXO1&%&5HVHDUFK
190
&216758&7,21~0$<
6$8',&$%/(&203$1<
$/62.12:1$66&&6&&*5283
(VWDEOLVKHGLQ6DXGL&DEOH&RPSDQ\6&&LV
KHDGTXDUWHUHGLQ-HGGDK6DXGL$UDELD6&&PDQXIDFWXUHV
DQGVHOOVFDEOHVDQGUHODWHGSURGXFWV%HVLGHV6DXGL$UDELD
WKHFRPSDQ\KDVRSHUDWLRQVLQ/HEDQRQWKH867XUNH\DQG
%DKUDLQ
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
6&&PDQXIDFWXUHVDQGPDUNHWVORZPHGLXPDQGKLJKYROWDJHZLUHVDVZHOO
DVFDEOHVEXLOGLQJZLUHVLQVXODWHGSRZHUFDEOHVWHOHFRPPXQLFDWLRQFDEOHV 672&.'(7$,/6
YDULRXVFRQGXFWRUVXVHGIRUWUDQVPLVVLRQDQGGLVWULEXWLRQFRSSHUDQG
ZHHNUDQJH+/65
DOXPLQXPURGVDQGSRO\YLQ\OFKORULGH7KHFRPSDQ\DOVRSURYLGHVWXUQNH\
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
SURMHFWVHUYLFHVIRUSRZHUDQGWHOHFRPSURMHFWVLQFOXGLQJV\VWHPVGHVLJQ
LQVWDOODWLRQHQJLQHHULQJDQGWHVWLQJ
3ULFHSHUIRUP 0
$EVROXWH
x )LQDQFLDOV
5HYHQXHVIRUJUHZ<R<WR65EQ(%,7'$PDUJLQVJUHZWR
LQFRPSDUHGWRDORVVRI65PQLQ7KHFRPSDQ\UHSRUWHG
DQHWSURILWRI65PQLQFRPSDUHGWRDQHWORVVRI65PQLQ$V
SHUWKHFRPSDQ\WKHJURZWKLQUHYHQXHDQGSURILWZDVDWWULEXWHGWRLPSURYHG
PDUNHWFRQGLWLRQVDQGEHWWHURSHUDWLRQDOSHUIRUPDQFHLQWKHFRUHFDEOH
EXVLQHVV
2Q0DUFKWKHFRPSDQ\DQQRXQFHGWKDWLWKDVEHHQDZDUGHGD
86'PQFRQWUDFWWRVXSSO\KLJKYROWDJHFDEOHVWR&RPSWRLU$OJpULHQGX
0DWpULHO(OHFWULTXHHW*D]LHU$OJHULD7KHFDEOHVDUHWREHGHOLYHUHGLQ
PRQWKVVWDUWLQJ2FWREHUWKHHIIHFWIRUWKHVDPHZRXOGEHUHIOHFWHGLQ
4ILQDQFLDOVWDWHPHQWV
7KHFRPSDQ\ZRQD65PQFRQWUDFWIURP6RODU(OHFWULF3RZHU&RPSDQ\
WRVXSSO\WKHODWWHUZLWKKLJKYROWDJHFDEOHVWREHGHOLYHUHGEHWZHHQ2FWREHU
DQG-XQH7KHHIIHFWRIWKHFRQWUDFWZRXOGEHUHIOHFWHGLQ4
ILQDQFLDOVWDWHPHQWV
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
6&$&2$%
ZZZVDXGLFDEOHFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6+$5(35,&(3(5)250$1&(
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
10
<R<
10
10
10
&$*5
0D\
6HS
7$6,
-DQ
0D\
6DXGL&DEOH5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
;HQHO,QGXVWULDO&R
6RXUFH7DGDZXO1&%&5HVHDUFK
191
&216758&7,21~0$<
$5$%,$13,3(6
$/62.12:1$6$&$3&$1$%,%
$UDELDQ3LSHV&RPSDQ\$3&LVWKHODUJHVWPDQXIDFWXUHURI
PHGLXPVL]HG+LJK)UHTXHQF\:HOGHG+):VWHHOSLSHVLQ
WKH0LGGOH(DVW7KHFRPSDQ\PDQXIDFWXUHVDQWLFRUURVLRQ
FRDWHG+):SLSHVIRUWKHRLOJDVSHWURFKHPLFDO
DJULFXOWXUDODQGFRQVWUXFWLRQLQGXVWULHV(VWDEOLVKHGLQ
$3&KDVDPDQXIDFWXULQJIDFLOLW\LQ5L\DGK
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
$3&¶VSURGXFWOLQHLQFOXGHVOLQHSLSHDSSOLFDWLRQVIRUORQJGLVWDQFHRLOJDV 672&.'(7$,/6
WUDQVSRUWDWLRQVWUXFWXUDODSSOLFDWLRQVIRUFRQVWUXFWLRQJHQHUDOSXUSRVH
ZHHNUDQJH+/65
DSSOLFDWLRQVLQGXVWULDOZDWHUDQGLUULJDWLRQVWDQGDUGSUHVVXUHDSSOLFDWLRQV
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
DQGFDVWLQJDSSOLFDWLRQV$3&¶VWRWDOSURGXFWLRQFDSDFLW\LVWRQVRI
VWHHOSLSHVSHUDQQXP,WDOVRKDVDRZQHUVKLSLQ$UDELDQ<DGRQJ
3ULFHSHUIRUP 0
&RDWLQJ&RPSDQ\
$EVROXWH
x )LQDQFLDOV
$3&¶VUHYHQXHVLQFUHDVHG<R<WR65PQ(%,7'$PDUJLQV
URVHWR<R<IURP+RZHYHU$3&UHSRUWHGDQHWORVVRI65PQ
LQDJDLQVWDQHWORVVRI65PQLQGXHWRKLJKHUIL[HGH[SHQVHV
PDLQO\LQWHUHVWH[SHQVHVZKLFKLQFUHDVHGE\65PQFRPSDUHGWRODVW
\HDUDQGWKHGHFOLQHLQLQYHVWPHQWLQFRPH
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
2Q-DQXDU\WKHFRPSDQ\DQQRXQFHGWKDWWKH&DSLWDO0DUNHW
$XWKRULW\DSSURYHGWKHGLVWULEXWLRQRIERQXVVKDUHVLQFUHDVLQJ
FDSLWDOWR65PQDIWHUWKHLVVXH
,Q-XQHWKHFRPSDQ\DQQRXQFHGWKDWLWKDVVLJQHGDWKUHH\HDU
65PQFRQWUDFWWRSURGXFHDQGVXSSO\VL[LQFKZHOGHGORQJLWXGLQDOVWHHO
SLSHVWR3HWUROHXP'HYHORSPHQW2PDQ2PDQ
(DUOLHULQ-DQXDU\WKHFRPSDQ\DFTXLUHGWKHUHPDLQLQJVWDNHLQ
$UDELDQ<DGRQJ&RDWLQJ&RPSDQ\IURP<DGRQJ$QWL&RUURVLRQ&R/WGIRU
65PQ
$3&2$%
ZZZDUDELDQSLSHVFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6+$5(35,&(3(5)250$1&(
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
$3&5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$EGXO4DGHU$O0RKDLGLE
6RQV&R
6DOHK$EGXOD]L]%DEDNHU
6RQV&R
6RXUFH7DGDZXO1&%&5HVHDUFK
192
&216758&7,21~0$<
$%'8//$+$0$/.+2'$5,
6216&2
$/62.12:1$6$$0$.
$%'8//$+$0$/.+2'$5,6216&2$$0$.LVDPDMRU
FRQWUDFWRUDQGLQIUDVWUXFWXUHGHYHORSHULQWKHUHJLRQ
+HDGTXDUWHUHGLQ$O.KREDU$$0$.H[HFXWHVSURMHFWVLQ
6DXGL$UDELDDQGQHLJKERULQJFRXQWULHVLQWKH0LGGOH(DVW
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
$$0$.PDLQO\GHDOVLQWKHFRQVWUXFWLRQRILQGXVWULDOFLYLOUHVLGHQWLDODQG
FRPPHUFLDOEXLOGLQJVURDGVDQGEXLOGLQJLQIUDVWUXFWXUHDVZHOODVRSHUDWLRQV
DQGPDLQWHQDQFHRIPXQLFLSDODUHDVDQGLQVWLWXWLRQDOVHFWRUV7KHFRPSDQ\ 672&.'(7$,/6
LPSOHPHQWVJHQHUDOFRQWUDFWLQJSURMHFWVLQFOXGLQJFLYLOFRQVWUXFWLRQUDLOZD\V ZHHNUDQJH+/65
RLOJDVSLSHOLQHVZDWHUZDVWHZDWHUWUHDWPHQWHOHFWULFDOZRUNVDQG
0DUNHWFDSPQ
KHDY\VWHHOPHWDOIDEULFDWLRQ,WDOVRRSHUDWHVDQGPDLQWDLQVSODQWVDQG
6KDUHVRXWVWDQGLQJPQ
IDFLOLWLHVIRXQGDWLRQVODQGVFDSLQJVDQGVWDELOL]DWLRQVDQGRWKHUUHODWHG
3ULFHSHUIRUP 0
HDUWKZRUNV
x )LQDQFLDOV
$$0$.¶VVDOHVJUHZ<R<WR65PQLQ(%,7'$PDUJLQV
GHFOLQHGWRLQFRPSDUHGWRLQPDLQO\GXHWRDQ
LQFUHDVHLQPDQSRZHUFRVW1HWLQFRPHGHFUHDVHGWR65PQLQ
FRPSDUHGWR65PQLQGXHWRDIDOOLQWUDGLQJVHJPHQWSURILWV
DQGKLJKHUVHOOLQJPDUNHWLQJH[SHQGLWXUH
,Q0DUFKWKHFRPSDQ\DQQRXQFHGWKDWLWVLJQHGDPRQWKFRQWUDFW
IRU65PQZLWKWKH0LQLVWU\RI+LJKHU(GXFDWLRQIRUFRQVWUXFWLRQRIWKH
)DFXOW\RI(QJLQHHULQJIRU0HQSKDVH
,Q0DUFKWKHFRPSDQ\VLJQHGDFRQWUDFWZLWKWKH0LQLVWU\RI:DWHUDQG
(OHFWULFLW\IRU65PQZKLFKLVH[SHFWHGWRDIIHFWWKHFRPSDQ\
VILQDQFLDO
VWDWHPHQWVLQ4
,Q0DUFK$$0$.DQQRXQFHGWKHVLJQLQJRIWKH,VODPLF&UHGLW)DFLOLWLHV
$JUHHPHQWDPRXQWLQJWR65PQIRUUHQHZDORIH[LVWLQJDQGQHZFUHGLW
IDFLOLWLHVZLWK6$0%$)LQDQFLDO*URXS
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
$/.+2'$5$%
ZZZDONKRGDULFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
$/.+2'$55+6
7236+$5(+2/'(56
$EGXOODK$0$O.KRGDUL6RQV
,QYHVWPHQW+ROGLQJ&RPSDQ\
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
193
&216758&7,21~0$<
6$8',,1'8675,$/
$/62.12:1$66,'&
6DXGL,QGXVWULDO'HYHORSPHQW&RPSDQ\6,'&HVWDEOLVKHGLQ
LQYHVWVLQWKHLQGXVWULDOVHFWRURIWKH.6$7KHFRPSDQ\
PDQXIDFWXUHVDQGGLVWULEXWHVFHUDPLFVVXFKDVEDWKWXEV
VDQLWDU\ZDUHDQGWLOHVKRPHIXUQLVKLQJDQGPDWWUHVVHV
2YHUWKH\HDUV6,'&KDVGLYHUVLILHGLWVLQYHVWPHQWVWRFRYHU
VSULQJPDWWUHVVHVDQGSRO\HVWHUILEHUV
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
6,'&RSHUDWHVWKURXJKLWVDIILOLDWHV6DXGL&HUDPLF3ODQWLQZKLFK6,'&
KROGVVWDNHLQWKH<DQEX,QGXVWULDO&LW\SURGXFHVFHUDPLFVDQLWDU\
ZDUHDQQXDOFDSDFLW\RIXQLWVDVZHOODVDFU\OLFEDWKWXEVDQG
VKRZHUWUD\VDQQXDOFDSDFLW\RIXQLWV$UDELDQ6SULQJDQG6SRQJH
0DWWUHVVHV0IJ&RVWDNHIRUPHUO\NQRZQDV6OHHS+LJKLVDOHDGLQJ
PDQXIDFWXUHURIVSULQJPDWWUHVVHV
x )LQDQFLDOV
6,'&¶VUHYHQXHVJUHZ<R<WR65PQLQ(%,7'$LQFUHDVHG
<R<WR65PQ+RZHYHUWKHFRPSDQ\UHSRUWHGQHWLQFRPHRI
65PQDGHFOLQHFRPSDUHGWR7KLVZDVPDLQO\DWWULEXWDEOHWR
DJDLQUHFRUGHGLQUHIOHFWLQJWKHVDOHRILWVLQYHVWPHQWLQ<DQVDEZKLFK
ZDVQRWSUHVHQWLQ
x 5HFHQWGHYHORSPHQWV
2Q$SULOWKHFRPSDQ\¶V%RDUGDSSURYHGUDLVLQJLWVVXEVLGLDU\6,'&
&RPPHUFLDO,QYHVWPHQW&R¶VFDSLWDOWR65PQIURP65PQ7KHFDSLWDO
UDLVHZRXOGEHXQGHUWDNHQE\WUDQVIHUULQJWKHFRPSDQ\¶VRXWVWDQGLQJGHEWWR
WKHVXEVLGLDU\¶VFDSLWDO
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6,'&$%
ZZZVLGFFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
2Q$SULOWKHFRPSDQ\DQQRXQFHGWKDWWKHFRXUWKDGUHMHFWHGWKH
ODZVXLWILOHGDJDLQVWWKHFRPSDQ\E\WKHIRUPHUSDUWQHUVLQ6OHHS+LJK6DXGL
$UDELDDQG(J\SW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6+$5(35,&(3(5)250$1&(
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
10
10
0D\
6HS
7$6,
-DQ
0D\
6,'&5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
6RXUFH7DGDZXO1&%&5HVHDUFK
194
&216758&7,21~0$<
1$7,21$/*<3680&203$1<
$/62.12:1$61*&*<3680
1DWLRQDO*\SVXP&RPSDQ\KHDGTXDUWHUHGLQ5L\DGK
VSHFLDOL]HVLQWKHSURGXFWLRQRIJ\SVXPSODVWHUVSODVWHU
ERDUGVDQGODPLQDWHGJ\SVXPWLOHV1DWLRQDO*\SVXP¶V
PDQXIDFWXULQJSODQWVDUHORFDWHGLQ5L\DGKDQG<DQEXZKLOH
LWVEUDQFKHVDUHVLWXDWHGDW-HGGDKDQG'DPPDP7KH
FRPSDQ\H[SRUWVLWVSURGXFWVZRUOGZLGH1DWLRQDO*\SVXP
KROGVDVWDNHLQLWVVXEVLGLDU\4DWDU6DXGL*\SVXP
&RPSDQ\
x %XVLQHVVEULHI
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
1DWLRQDO*\SVXPKDVDQDQQXDOSURGXFWLRQFDSDFLW\RIWRQVRI
J\SVXPSODVWHUPQVTXDUHPHWHUVRISODVWHUERDUGWRQVRIVSUD\
J\SVXPDQGIL[LQJSODVWHUPQVTXDUHPHWHUVRIJ\SVXPFHLOLQJWLOHVDQG
WRQVRIJ\SVXPSRZGHU
x )LQDQFLDOV
7KHFRPSDQ\¶VVDOHVGHFOLQHG<R<WR65PQLQ+RZHYHU
(%,7'$PDUJLQUHPDLQHGIODWDWLQFRPSDUHGWRWKHODVW\HDU1HW
SURILWIHOO<R<WR65PQLQ7KHFRPSDQ\KDVDWWULEXWHGWKH
GHFOLQHLQUHYHQXHDQGQHWLQFRPHWRLQFUHDVHGFRPSHWLWLRQ
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
x 5HFHQWGHYHORSPHQWV
2Q$SULOWKHFRPSDQ\DQQRXQFHGWKDWWKH$*0DSSURYHGWKH
GLVWULEXWLRQRIFDVKGLYLGHQGV65SHUVKDUHIRU
6(
%ORRPEHUJFRGH
1*&2$%
ZZZJ\SVFRFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
3([
$
$
$
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
0D\
-DQ
*\SVXP5+6
7236+$5(+2/'(56
$O0DQDID,QYHVWPHQW5HDO
(VWDWH'HYHORSPHQW&R
7KHQH\DQ)DKG7KHQH\DQ$O
7KHQH\DQ
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
195
&216758&7,21~0$<
5('6($+286,1*
$/62.12:1$656+5('6($
5HG6HD+RXVLQJ6HUYLFHV&RPSDQ\ZDVHVWDEOLVKHGLQ
-HGGDKLQ7KHFRPSDQ\¶VREMHFWLYHZDVWRUHSOLFDWHWKH
$PHULFDQPDQXIDFWXUHGKRXVLQJPRGHOLQ6DXGL$UDELD5HG
6HD+RXVLQJODWHUGLYHUVLILHGLQWRPDQXIDFWXULQJDQGSURSHUW\
PDQDJHPHQWVHWWLQJXSLWVILUVWPDQXIDFWXULQJIDFLOLW\LQ
7KHFRPSDQ\PDQXIDFWXUHVVHOOVDQGOHDVHVDOOW\SHVRI
PRGXODUEXLOGLQJV
x %XVLQHVVEULHI
5HG6HD+RXVLQJKDVWKUHHPDQXIDFWXULQJIDFLOLWLHVLQ'XEDL-XEDLODQG
$FFUD*KDQD7KHFRPSDQ\KDVDQDQQXDOSURGXFWLRQFDSDFLW\RI
VTXDUHPHWHUVRISUHIDEULFDWHGEXLOGLQJVSHU\HDU5HG6HD+RXVLQJVHUYHV
DOOW\SHVRIKRXVLQJUHTXLUHPHQWVFRPPHUFLDODQGUHVLGHQWLDOWHPSRUDU\DQG
SHUPDQHQW5HG6HD+RXVLQJRIIHUVVSHFLDOVHUYLFHVWRRLOJDVDQGPLQLQJ
FRPSDQLHVWKHFRPSDQ\¶VPDUNHWVFRPSULVH$IULFDWKH0LGGOH(DVW$VLD
DQG6RXWK$PHULFD
x )LQDQFLDOV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
5HG6HD¶VUHYHQXHVJUHZ<R<WR65PQLQ(%,7'$PDUJLQV
GHFOLQHGWRLQIURPD\HDUDJRGXHWRKLJKHULQVWDOODWLRQ
DQGPDWHULDOVFRVWLQFXUUHGWKLV\HDU+RZHYHUQHWSURILWURVH<R<WR
65PQLQGXHWRLQFUHDVHLQUHQWDOLQFRPHDQGDEVHQFHRIDQ\
SURYLVLRQVIRUOLWLJDWLRQVZKLFKKDGUHGXFHGQHWLQFRPHODVW\HDU
x 5HFHQWGHYHORSPHQWV
0
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
5('6($$%
ZZZUVKFRPVD
:(,*+7,1*)5(()/2$7
2Q-DQXDU\WKHFRPSDQ\DQQRXQFHGWKHGLVWULEXWLRQRIRQHERQXV
VKDUHIRUHYHU\WKUHHVKDUHVKHOGDVZHOODVWKHLQFUHDVHRIWKHVKDUHFDSLWDO
WR65PQIURP65PQ7KH%RDUGDOVRUHFRPPHQGHGWKHGLVWULEXWLRQ
RI65SHUVKDUHDVFDVKGLYLGHQGVIRU
7$6,IUHHIORDWZHLJKW
)UHHIORDW
$
$
$
,Q$XJXVWWKHFRPSDQ\DQQRXQFHGDGHOD\LQRSHQLQJLWVQHZIDFWRU\
LQ/LE\DZKLFKZDVHDUOLHUSODQQHGWRVWDUWLQ+7KHWRWDOFRVWRIWKH
IDFWRU\LVHVWLPDWHGWREH65PQZKLFKZRXOGLQFUHDVHWKHFRPSDQ\
V
SURGXFWLRQFDSDFLW\E\SHU\HDU
3([
9$/8$7,2108/7,3/(6
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
6+$5(35,&(3(5)250$1&(
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
&$*5
0D\
6HS
7$6,
-DQ
0D\
5HG6HD5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$O'DEEDJK+ROGLQJ&R
0XPWD])RRGV&R
7KH1DWLRQDO6FLHQWLILF&RPSDQ\
/7'
7HMDULDKIRU0DUNHWLQJ6HUYLFHV
DQG$JHQFLHV
6RXUFH7DGDZXO1&%&5HVHDUFK
196
&216758&7,21~0$<
6$8',9,75,),('
$/62.12:1$66$8',9,75,),('69&3
6DXGL9LWULILHG&OD\3LSHV&RPSDQ\69&3HVWDEOLVKHGLQ
DQGKHDGTXDUWHUHGLQ5L\DGKPDQXIDFWXUHVYLWULILHGFOD\
SLSHVDQGILWWLQJVDVZHOODVMDFNLQJSLSHV7KHFRPSDQ\¶V
DQQXDOSURGXFWLRQFDSDFLW\LVWRQVRIFOD\SLSHVDQG
ILWWLQJVSHU\HDU$ORQJZLWKWKHORFDO6DXGL$UDELDQPDUNHW
69&3KDVDSUHVHQFHLQLQWHUQDWLRQDOPDUNHWVLQFOXGLQJ$UDE
FRXQWULHVWKH)DU(DVWDQG(XURSH
x %XVLQHVVEULHI
69&3PDQXIDFWXUHVYLWULILHGFOD\SLSHVUDQJLQJIURP±PPDQG
MDFNLQJSLSHV±PP7KHVHSLSHVDUHXVHGLQGRPHVWLFDQG
LQGXVWULDOVHZDJHV\VWHPVDVZHOODVIRUVWRUPZDWHUGLVSRVDO7KHPDLQ
IHDWXUHVRIWKHVHSLSHVDUHVWUHQJWKGXUDELOLW\DQGUHVLVWDQFHWRFKHPLFDOV
FRQWDLQHGLQVHZDJHDQGGUDLQDJHZDWHU7KHFRPSDQ\KDVDVWDWHRIWKHDUW
IDFLOLW\LQ5L\DGKZLWKDQDQQXDOSURGXFWLRQFDSDFLW\RIWRQV
x )LQDQFLDOV
69&3¶VUHYHQXHVIRUJUHZE\<R<WR65PQRQDFFRXQWRI
LQFUHDVHGSURGXFWLRQGXHWRHIILFLHQF\JDLQVLQSURGXFWLRQ(%,7'$LQFUHDVHG
WR65PQ1HWLQFRPHLQFUHDVHGWR65PQLQIURP
65PQLQGXHWRORZHURSHUDWLQJH[SHQVHDQGILQDQFLDOFKDUJHV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
2Q)HEUXDU\WKHFRPSDQ\DQQRXQFHGWKDWLWKDGH[WHQGHGWKH
PHPRUDQGXPRIXQGHUVWDQGLQJLWKDGVLJQHGZLWK$UDELDQ&RPSDQ\IRU
:DWHU3LSH,QGXVWU\$FZDSLSHWRIXOO\DFTXLUHWKHODWWHU
VVWDNHWKURXJKD
VKDUHVZDSGHDOIRUDVL[PRQWKSHULRG
69&3$%
ZZZVYFSVDFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6+$5(35,&(3(5)250$1&(
<R< &$*5
0D\
6HS
7$6,
-DQ
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$EGXO/DWLI$O(VVD&R
3ULQFH)DLVDO$EGXO$]L])DLVDO$O
6DXG
6DDG6DXG,EUDKLP$O6D\DUL
$O5L\DGK,QYHVWPHQW&R
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
0D\
69&35+6
6RXUFH7DGDZXO1&%&5HVHDUFK
197
&216758&7,21~0$<
0(63(&,$/,=('&$%/(
$/62.12:1$60(6&
0LGGOH(DVW6SHFLDOL]HG&DEOHV&R0(6&EHJDQDVDORFDO
PDQXIDFWXUHULQ5L\DGKLQ,Q0(6&DFTXLUHG
-RUGDQ1HZ&DEOH&RPSDQ\DQGLQLWHQWHUHGLQWRD
MRLQWYHQWXUHZLWK)XMLNXUD&RPSDQ\WRH[SDQGLWVSURGXFW
UDQJHWRORZDQGPHGLXPYROWDJHSRZHUFDEOHV
127&29(5('
&XUUHQWSULFH
3ULFLQJDVRI
x %XVLQHVVEULHI
0(6&¶VSURGXFWVFDWHJRUL]HGLQWRLQVWUXPHQWDWLRQDQGSURFHVVFRQWURO
FDEOHVDUHXVHGLQLQGRRURXWGRRUDQGFRQWUROURRPDSSOLFDWLRQVV\VWHP
672&.'(7$,/6
FDEOHVGDWDDQGWHOHSKRQHFDEOHVDQGSRZHUFDEOHVXVHGLQDSSOLFDWLRQV ZHHNUDQJH+/65
UHTXLULQJJUHDWHUHOHFWULFDORUHOHFWURPDJQHWLFSURWHFWLRQ7KHFRPSDQ\DOVR
0DUNHWFDSPQ
PDUNHWVVSHFLDOL]HGFDEOHVIRUKDUVKHQYLURQPHQWDSSOLFDWLRQVVXFKDVWKRVH 6KDUHVRXWVWDQGLQJPQ
LQWKHK\GURFDUERQLQGXVWU\0(6&KDVDQDQQXDOSURGXFWLRQFDSDFLW\RI
3ULFHSHUIRUP 0
DERXWWRQVRIFRSSHUDQGWRQVRIDOXPLQXPFDEOHV%HVLGHV
$EVROXWH
UHJLRQDORSHUDWLRQV0(6&KDVDSUHVHQFHLQFRXQWULHV
x )LQDQFLDOV
0(6&¶VUHYHQXHVLQFUHDVHG<R<WR65PQLQ(%,7'$IHOO
<R<WR65PQ0(6&LQFXUUHGDQHWORVVRI65PQLQ
FRPSDUHGWRDQHWORVVRI65PQLQGXHWRLQFUHDVHGFRPSHWLWLRQ
HVSHFLDOO\LQSRZHUFDEOHV$OVRDFKDUJHDPRXQWLQJWR65PQIRU
LPSDLUPHQWRIJRRGZLOOUHODWHGWR0(6&¶VLQYHVWPHQWLQ-RUGDQH[HUWHG
SUHVVXUHRQWKHERWWRPOLQH
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
0(6&$%
ZZZPHVFFDEOHVFRP
x 5HFHQWGHYHORSPHQWV
:(,*+7,1*)5(()/2$7
2Q0DUFKWKH0(6&%RDUGDSSURYHGWKHDOORFDWLRQRI0(6&
6DXGL¶VVWDNHLQ0(6&-RUGDQWRWKHODWWHU
VHPSOR\HHV$VDUHVXOW
0(6&6DXGL¶VVWDNHZRXOGGHFOLQHWR7KH%RDUGDOVRDSSURYHGRI
LQFUHDVLQJWKHFDSLWDORI0(6&5DV$O.KDLPDKIURP$('PQWR$('PQ
E\FDSLWDOL]LQJ$('PQRIWKHORDQSURYLGHGE\0(6&6DXGL
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
<R<
10
10
&$*5
0D\
6HS
7$6,
-DQ
0D\
0(6&5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
$EGXO$]L]0RKDPPHG6XODLPDQ$O 1DPODK
0DQVRXU$0.DDNL
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
198
&216758&7,21~0$<
81,7(':,5()$&725,(6
&203$1<
$/62.12:1$6$6/$.
8QLWHG:LUH)DFWRULHV&RPSDQ\³$6/$.´ZDVHVWDEOLVKHG
127&29(5('
DVDOLPLWHGOLDELOLW\FRPSDQ\LQ,QDJURXSRI
FRPSDQLHVDQGHVWDEOLVKPHQWVWKDWKDGH[WHQVLYHH[SHULHQFH
&XUUHQWSULFH65 LQZLUHPDQXIDFWXULQJZHUHPHUJHGLQRQHQHZFRPSDQ\
3ULFLQJDVRI
³$6/$.´WKXVHQDEOLQJWKHQHZFRPSDQ\WRRZQHLJKW
IDFWRULHVGLVWULEXWHGDFURVVWKH.LQJGRPRI6DXGL$UDELD7KH
FRPSDQ\ZDVODWHUWUDQVIRUPHGLQWRDSXEOLFMRLQWVWRFN
FRPSDQ\LQDQGOLVWHGRQWKH7DGDZXO([FKDQJHRQ
672&.'(7$,/6
$XJXVW
ZHHNUDQJH+/65
x %XVLQHVVEULHI
$6/$.GHDOVZLWKWKHPDQXIDFWXUHDQGGLVWULEXWLRQRIVWHHOUHEDUVEDLOLQJ
ZLUHVEDUEHGZLUHVFORWKHVKDQJHUVVWHHOQDLOVZLUHPHVKIHQFHVDQG
RWKHUUHODWHGSURGXFWV,WKDVDQDQQXDOSURGXFWLRQFDSDFLW\RIWRQVRI
VWHHOWRQVRIVWHHOQDLOVWRQVRIEDUEHGZLUHVWRQVRI
FORWKHVKDQJHUVDQGWRQVRIJDOYDQL]HGZLUHV,WDOVRKDVWKHFDSDFLW\
WRSURGXFHWRQVRIVWHHOUHEDUVSHUPRQWK
x )LQDQFLDOV
$6/$.¶VUHYHQXHVLQFUHDVHG<R<WR65PQLQ(%,7'$
PDUJLQVGHFOLQHGWRLQFRPSDUHGWRLQSULPDULO\GXH
WRWKHLQFUHDVHLQUDZPDWHULDOSULFHV7KHFRPSDQ\UHSRUWHGDQ<R<
GHFOLQHLQQHWSURILWWR65PQLQ
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
0
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$6/$.$%
ZZZXQLWHGZLUHVFRPVD
:(,*+7,1*)5(()/2$7
x 5HFHQWGHYHORSPHQWV
2Q0DUFKWKHFRPSDQ\DQQRXQFHGGLYLGHQGRI65SHUVKDUH
IRUWKHVHFRQGKDOIRIPDNLQJWKHIXOO\HDUGLYLGHQGIRU65
SHUVKDUH
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6+$5(35,&(3(5)250$1&(
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK* )LQDQFLDOIRUDUHIRUPRQWKV
<R<
&$*5
10
$XJ
1RY
7$6,
)HE
0D\
8QLWHG:LUH5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
0RKDPPHG5DVKLG0RKDPHG
5DVKLG
.KDOHG6DDG$EGXOUDKPDQ
$ONDQKDO
6RXUFH7DGDZXO1&%&5HVHDUFK
199
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Real Estate
Ticker
Company
Page No.
4090
Taiba
203
4300
Dar Al Arkan
204
4020
Al Akaria
205
4310
KEC Madinah
206
4250
Jabal Omar
207
4100
Makkah
208
4220
Emaar E .C
209
4150
Arriyadh Dev
210
0$<
5($/(67$7(
*URZWKSRWHQWLDOWLHGWRGHPRJUDSKLFV
7KH6DXGLUHDOHVWDWHVHFWRULVOLNHO\WRFRQWLQXHEHQHILWLQJIURPD
ODUJHDQG\RXQJSRSXODWLRQH[SHFWHGWRJURZDQQXDOO\XQWLO
ULVLQJQXPEHURIKRXVHKROGVH[SDQVLRQLQEXVLQHVVDFWLYLW\
DQGUHOLJLRXVWRXULVPLQWKHPHGLXPWHUP,QDGGLWLRQDKLJK
SURSRUWLRQRIQDWLRQDOVLQWKH.LQJGRP¶VSRSXODWLRQRIWKH
WRWDOSRSXODWLRQLQYLVjYLVRWKHU*&&FRXQWULHVLVDNH\
IDFWRUGULYLQJGHPDQGIRUUHDOHVWDWH
6DXGL$UDELD¶VSRSXODWLRQDJJUHJDWHGPQLQUHSUHVHQWLQJDURXQG
RIWKHWRWDO*&&SRSXODWLRQ7KH3RSXODWLRQKDVEHHQJURZLQJSHU\HDU
RYHUWKHSDVW\HDUVZKLFKLVRQHRIWKHIDVWHVWJURZWKUDWHVLQWKHZRUOG
Exhibit 118: Saudi population is the largest in GCC
Exhibit 119: Saudi population by age group
7KRXVDQGSHUVRQ²-XO\GDWD
6DXGLVRQO\GDWD
%DK UDLQ
)HPDOH
0DOH
4DWDU
.XZDLW
2PDQ
8$(
6DX GL$ UDELD
6RXUFH811&%&5HVHDUFK
6RXUFH811&%&5HVHDUFK
5HVLGHQWLDOVHFWRU
7KHVXSSO\GHPDQGPLVPDWFKLQWKHKRXVLQJVHFWRUZLGHQHGDOWKRXJKJURZWKLQ
\RXQJSRSXODWLRQDQGDGHFOLQHLQDYHUDJHKRXVHKROGVL]HFRQWLQXHWRGULYH
GHPDQG6DXGL$UDELDZRXOGUHTXLUHDQDGGLWLRQDOXQLWVRYHU±(
DQGDWRWDORIPQXQLWVRYHUWKHFRPLQJGHFDGHXQLWVSHU\HDU
+RZHYHUZHEHOLHYHDIIRUGDELOLW\DQGODFNRIDFFHVVWRPRUWJDJHFUHGLWDUHWKH
SULPDU\URDGEORFNVLPSDFWLQJGHPDQGIRUKRXVLQJ
2IILFHVHFWRU
2IILFHUHQWDOUDWHVLQ.6$UHPDLQHGUHODWLYHO\VWDEOHLQ+RZHYHUDVWKH
RYHUVXSSOLHGPDUNHWPRYHVWRZDUGVPRUHFRPSHWLWLYHSULFLQJGHPDQGFRXOG
SRWHQWLDOO\LQFUHDVHIRUKLJKTXDOLW\SURMHFWVLQWKHPHGLXPWHUP,QDGGLWLRQ
EDVHGRQWKHEXVLQHVVYROXPHLQ6DXGL$UDELDWKHQDWXUHRIGHPDQGDQGWKH
FXUUHQWDQGIRUWKFRPLQJVXSSO\RIRIILFHVSDFHZHH[SHFWDGHFOLQHLQ
RFFXSDQF\UDWHVDFURVVPDMRUFLWLHV7KLVFRXOGH[HUWGRZQZDUGSUHVVXUHRQ
RIILFHUHQWDOV
5HWDLOVHFWRU
5HWDLOVSHQGLQJZKLFKGULYHVGHPDQGIRUUHWDLOVSDFHVUHPDLQHGVWURQJLQ
GXHWRSRSXODWLRQJURZWKDQGKLJKHUKRXVHKROGFRQVXPSWLRQ,Q6DXGL$UDELD
VXSSO\RIUHWDLOVSDFHLVVWLOOYHU\ORZDQGUHQWDOSULFHVDUHFRPSDUDWLYHO\ORZHU
FRPSDUHGWRRWKHUPDMRUFLWLHVLQ*&&'HPDQGIRUUHWDLOVSDFHLVH[SHFWHGWR
LQFUHDVHLQWDQGHPZLWKKRXVHKROGFRQVXPSWLRQZKLFKLVH[SHFWHGWRJURZ±
SHUDQQXPRYHUWKHQH[WIHZ\HDUV
201
5($/(67$7(
1&%&$3,7$/
0$<
+RVSLWDOLW\VHFWRU
7KHQXPEHURIYLVLWRUVWRDSDUWLFXODUJHRJUDSKLFDODUHDLVWKHNH\GULYHUIRUWKH
KRVSLWDOLW\VHFWRU7KHKRWHOLQGXVWU\LQ.6$LVFODVVLILHGLQWR5L\DGK.KREDU
0DNNDKDQG0DGLQDKZKLFKDWWUDFWKLJKHUQXPEHURILQWHUQDWLRQDODQG*&&
WUDYHOHUVIRUEXVLQHVVRUSLOJULPDJH2QWKHRWKHUKDQG-HGGDKLVIUHTXHQWHG
E\6DXGLQDWLRQDOVIRUOHLVXUHRUEXVLQHVVDQGKHQFHLVPRUHGHSHQGHQWRQWKH
ORFDOHFRQRP\*LYHQWKHH[SHFWHGJURZWKLQWRXULVWDUULYDOVWKHKRVSLWDOLW\
VHFWRUUHPDLQVDVLJQLILFDQWRSSRUWXQLW\IRULQYHVWRUV
7KHVHFWRU¶VUHYHQXHGHFOLQHG<R<WR65EQLQGXHWRDVORZGRZQLQ
FRQVWUXFWLRQDFWLYLW\'DU$O$UNDQUHPDLQHGWKHODUJHVWSOD\HUDFFRXQWLQJIRU
RIWKHVHFWRU¶VWRWDOUHYHQXHVGXULQJWKHVDPH\HDU(PDDU¶VUHYHQXHVURVH
IRXUIROGWR65PQLQ6DXGL5HDO(VWDWH&RPSDQ\UHYHQXHVIHOO
<R<UHFRUGHGWKHVKDUSHVWIDOO7KHFRPELQHGUHYHQXHVRIRWKHUVPDOOHU
SOD\HUVLQFOXGLQJ0DNNDK$UUL\DGKDQG.(&LQFUHDVHGRI<R<WR
65PQGXULQJWKH\HDU2YHUDOOWKHVHFWRU¶VQHWLQFRPHJUHZWR65EQLQ
IURP65EQLQDPLGORZHURSHUDWLQJDQGPDLQWHQDQFHFRVWV
Exhibit 120: Revenues of companies, 2009±11
Exhibit 121: Profitability of companies relative to the
sector average, 2009- 2011
65PQ
2WKHUV
'DU$ODUNDQ
7DLED
$O$NDULD
6RXUFH7DGDZXO1&%&5HVHDUFK
6HFWRU$YH UDJH
6DX GL5HD O(VWDWH
7DLED
'DU$ODUNDQ
6RXUFH7DGDZXO1&%&5HVHDUFK
1&%&5HFRPPHQGDWLRQ
:HUHPDLQIDLUO\RSWLPLVWLFDERXWWKH6DXGLUHDOHVWDWHVHFWRU¶VSURVSHFWVLQWKH
ORQJWHUP7KHUHVLGHQWLDOVXEVHFWRULVH[SHFWHGWRUHSRUWIDVWHVWJURZWKLQWKH
QHDUWHUPZKLOHWKHRIILFHVXEVHFWRULVOLNHO\WRZLWQHVVDQRYHUVXSSO\
+RZHYHUIXQGDPHQWDOGULYHUVLQFOXGLQJIDYRUDEOHGHPRJUDSKLFVLQFUHDVHLQ
EXVLQHVVDFWLYLW\DQGUHOLJLRXVWRXULVPUHPDLQLQWDFW:HDUHFXUUHQWO\FRYHULQJ
WKUHHVWRFNVLQWKHUHDOHVWDWHVHFWRU'DU$O$UNDQ7DLEDDQG$O$NDULD
Exhibit 122: Coverage stocks details
Stock
Current Rating
'DU$O$UNDQ
6(
1HXWUDO
7DLED
6(
2YHUZHLJKW
$O$NDULD
6(
1HXWUDO
PT (SR)
Comments
'DU$O$UNDQLVFXUUHQWO\GHYHORSLQJDQXPEHURIFDSLWDOLQWHQVLYHSURMHFWVKRZHYHU
EDQNVDQGILQDQFLDOLQVWLWXWLRQVFRXOGEHUHOXFWDQWWROHQGWRWKHFRPSDQ\GXHWR
DOOHJDWLRQVRIDFULVLVRQLWVZHEVLWH)XUWKHUPRUHLQYHVWRUV¶SHUFHSWLRQZKLFKKDV
EHHQLPSDFWHGE\ZHDNHDUQLQJVDQGODFNRIWUDQVSDUHQF\RYHUWKHODVWIHZ\HDUV
FRXOGLPSURYHLIPDQDJHPHQWSURYLGHVIXUWKHULQVLJKWLQWRLWVODQGEDQN7KHVWRFN
RXWSHUIRUPHGWKH7$6,LQGH[UHIOHFWLQJWKHOLPLWHGXSVLGHSRWHQWLDO
:LWKDSRUWIROLRRISULPHDVVHWVH[SHFWHGUHYHQXHJURZWKDQGLPSURYHPHQWLQ
PDUJLQVZHEHOLHYH7DLED¶VIXQGDPHQWDOVLQFOXGLQJLWVVWDWXVDVRQHRIWKHKROLHVW
FLWLHVIRU0XVOLPVPDNHVWKHVWRFNDQDWWUDFWLYHSOD\LQWKHKRVSLWDOLW\VHFWRU
*RRGHDUQLQJVYLVLELOLW\IXWXUHJURZWKSRWHQWLDODQGDODUJHODQGEDQNDUHSRVLWLYHV
KRZHYHUWKHVHDUHSDUWLDOO\RIIVHWE\DORZ52(DQGULVNRIH[FHVVRIILFHVXSSO\LQ
5L\DGK
6RXUFH1&%&5HVHDUFK
202
5($/(67$7('(9(/230(17~0$<
7$,%$+2/',1*
$/62.12:1$67$,%$
7DLED+ROGLQJ&R7DLEDHVWDEOLVKHGLQ6HSWHPEHULV
EDVHGLQ0DGLQDKKRPHRIWKHVHFRQG+RO\0RVTXHLQ,VODP
7KHFRPSDQ\WUDQVIRUPHGWRDKROGLQJFRPSDQ\LQDQG
WUDQVIHUUHGPRVWRILWVDVVHWVWRLWVVXEVLGLDULHV,WFXUUHQWO\
RZQVDQGPDQDJHVUHDOHVWDWHSURSHUWLHVKRWHOVDQGUHVRUWV
PDLQO\WKURXJKLWVVXEVLGLDULHVDQGLVJHRJUDSKLFDOO\
FRQFHQWUDWHGLQ0DGLQDKDQGLWVVXUURXQGLQJFLWLHV
x %XVLQHVVEULHI
7DLEDSULPDULO\IRFXVHVRQWKHUHDOHVWDWHVHFWRULWLVDPDMRUGHYHORSHULQ
WKHFHQWUDODUHDVXUURXQGLQJWKH+RO\3URSKHW
VPRVTXH7DLED¶VVXEVLGLDULHV
DQGDVVRFLDWHFRPSDQLHVLQFOXGH$5$&DQG$O$THHT$OOUHDOHVWDWH
IXQFWLRQVDUHUXQE\$O$THHTWKHUHDOHVWDWHDUPDQGLQFOXGHUHDOHVWDWH
GHYHORSPHQWSURSHUW\VDOHVUHQWFRQWUDFWLQJDQGPDLQWHQDQFH7KH
VHFRQGODUJHVWUHYHQXHVRXUFHLV$5$&WKHWRXULVPDUPZKLFKRZQVDQG
RSHUDWHVSURSHUWLHVDQGUHVRUWVLQ0DGLQDK<DQEX$O8ODDQG0DNNDK
XQGHUGHYHORSPHQW
x )LQDQFLDOV
29(5:(,*+7
&XUUHQWSULFH65
3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
5HYHQXHVJUHZ<R<WR65PQIRUGULYHQE\KLJKHU
RFFXSDQF\UDWHVGXHWRWKHLQFUHDVHGQXPEHURI+DMMSLOJULPV(%,7'$URVH
WR65PQ<R<GXHWRLPSURYHGRSHUDWLRQDOHIILFLHQF\JDLQVIURP
FRPSHQVDWLRQIRUDSORWRIODQGLQ$O0DGLQDKFLW\DQGSURFHHGVIURPWKH
VDOHRI7DLED
VVKDUHRIODQGLQ-HGGDKFLW\7KHQHWLQFRPHJUHZ
<R<WR65PQLQ
x 5HFHQWGHYHORSPHQWV
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
7,5(&2$%
ZZZWDLEDFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
2Q0DUFK7DLEDDQQRXQFHGWKDWLWKDGILOHGDODZVXLWWRDSSHDO
DJDLQVWWKHFRPSHQVDWLRQYDOXHRIWKHODQGORFDWHGLQWKH0DUND]LDKDUHDLQ
$O0DGLQDK
)UHHIORDW
$
$
(
,Q)HEUXDU\WKHFRPSDQ\DQQRXQFHGDFDVKGLYLGHQGRI65SHU
VKDUHIRU4
3([
3%[
36[
'LY<LHOG
'36
9$/8$7,2108/7,3/(6
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
0DUNHWFDS65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
(
(
<R< &$*5
(
10
6+$5(35,&(3(5)250$1&(
0D\
6HS
-DQ
7$6,
0D\
7DLED5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
0DVHN+ROGLQJ&RPSDQ\
0RKDPPHG6DODK+DP]D6DLUDIL
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6RXUFH 7DGDZXO 1&%& 5HVHDUFK
203
5($/(67$7('(9(/230(17~0$<
6$8',5($/(67$7(
$/62.12:1$65($/(67$7($.$5,$
6DXGL5HDO(VWDWH$.$5,$ZDVHVWDEOLVKHGLQ5L\DGKLQ
$WSUHVHQWLWJHQHUDWHVDOORILWVUHYHQXHVIURP5L\DGK
'HVSLWHWKHJRRGHDUQLQJVYLVLELOLW\IXWXUHJURZWKSRWHQWLDO
DQGDODUJHODQGEDQNZKLFKDUHSRVLWLYHVIRUWKHFRPSDQ\
ZHUHPDLQFRQFHUQHGRYHUWKHORZ52(DVZHOODVWKH
FRQVLGHUDEOHLQFUHDVHLQFDSH[HVWLPDWHV
1(875$/
&XUUHQWSULFH65
3ULFLQJDVRI
x %XVLQHVVEULHI
$.$5,$LVRQHRIWKHSLRQHHUVLQVKRSSLQJFHQWHUFRQVWUXFWLRQLQWKH*&&,W
672&.'(7$,/6
DOVRGHYHORSVKRXVLQJDQGRIILFHFRPSOH[HV,QDGGLWLRQWKHFRPSDQ\
ZHHNUDQJH+/65
SDUWQHUVZLWKLQWHUQDWLRQDOKRWHOFKDLQRSHUDWRUVWRGHYHORSLQGXVWULDOVFLHQFH
0DUNHWFDS65PQ
SDUNVDQGKRWHOV$.$5,$¶VSULQFLSDOLQYHVWPHQWKROGLQJVLQFOXGHD
6KDUHVRXWVWDQGLQJPQ
VWDNHLQ6DXGL&RPSDQ\IRU$O0XDLTOLDK&RPPHUFLDO&HQWHUVWDNHLQ
8QLWHG*ODVV&RPSDQ\DQGVWDNHLQ'DU$O7DPOHHN&RPSDQ\
3ULFHSHUIRUP 0
$EVROXWH
x )LQDQFLDOV
6DOHVGHFOLQHG<R<WR65PQLQGXHWRDVLJQLILFDQWGURSLQ
ODQGVDOHVFRPSDUHGWR1HWLQFRPHIHOO<R<WR65PQ
KRZHYHUQHWPDUJLQLPSURYHGIURPLQWRLQ7KLV
ZDVGXHWRKLJKHURFFXSDQF\UDWHVDWWKH3OD]DFRPSOH[DQGRWKHU
SURSHUWLHV
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
x 5HFHQWGHYHORSPHQWV
6(
%ORRPEHUJFRGH
2Q$SULO6DXGL5HDO(VWDWHDSSURYHGWKHGLVWULEXWLRQRIFDVK
GLYLGHQGVIRUWKH+PDNLQJWKHIXOO\HDUGLYLGHQG65SHUVKDUH
2Q0DUFKWKH%2'DSSURYHGWKHFRPPHQFHPHQWRIWKHILUVWSKDVH
RILQIUDVWUXFWXUHGHYHORSPHQWIRUWKH$O$NDULD9LOODJHSURMHFWVL]HPLOOLRQ
VTXDUHPHWHULQ%DQEDQ6DXGL$UDELD
65(&2$%
ZZZDODNDULDFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
(
(
<R<
&$*5
(
$
$
(
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
5HDO(VWDWH5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
3XEOLF,QYHVWPHQW)XQG
6RXUFH7DGDZXO1&%&5HVHDUFK
204
5($/(67$7('(9(/230(17~0$<
'$5$/$5.$1
$/62.12:1$6'$$5'$5$/$5.$1
(VWDEOLVKHGLQ'DU$O$UNDQLVRQHRIWKHODUJHVWUHDO
HVWDWHGHYHORSHUVLQ6DXGL$UDELD7KHFRPSDQ\¶VPDLQ
DFWLYLWLHVLQFOXGHSXUFKDVHRIUHDOHVWDWHDQGODQGDQG
FRQVWUXFWLRQRIERWKFRPPHUFLDODQGUHVLGHQWLDOSURSHUWLHV
7KHFRPSDQ\KDVIRXUZKROO\RZQHGVXEVLGLDULHV'DU$O
$UNDQ,QYHVWPHQW&R'DU$O$UNDQ3URMHFWV&R'DU$O$UNDQ
3URSHUWLHV&RDQG'DU$O$UNDQ6XNXN&R
x %XVLQHVVEULHI
'DU$O$UNDQKDVDORQJKLVWRU\RIGHYHORSLQJUHVLGHQWLDOSURMHFWVDFURVVWKH
.LQJGRP+LVWRULFDOO\WKHVHGHYHORSPHQWVKDYHEHHQVPDOOUDQJLQJIURP
WHQVWRDIHZKXQGUHGXQLWVPDLQO\LQ5L\DGK+RZHYHUVLQFHWKH
FRPSDQ\KDVIRFXVHGRQGHYHORSLQJODUJHVFDOHPDVWHUSODQQHG
FRPPXQLWLHV7KHVHLQFOXGH6KDPV$OUL\DGK$O4DVUDQG$O7LODO'DU$O
$UNDQDOVRRIIHUVSUHVDOHVDIWHUVDOHVDQGIXQGLQJVHUYLFHVWRFXVWRPHUV,Q
'HFHPEHUWKHFRPSDQ\HVWDEOLVKHG6DXGL+RPH/RDQV&RPSDQ\
ZRUWK65EQWKDWFRPSOHPHQWVLWVFRUHEXVLQHVVDQGSURYLGHV6KDULDK
FRPSOLDQWKRPHORDQV
x )LQDQFLDOV
5HYHQXHVIHOOWR65EQLQIURP65EQLQGXHWRORZHU
UHYHQXHIURPODQGVDOHV1HWSURILWGHFOLQHG<R<WR65EQLQ
GXHWRLQFUHDVHGSROLWLFDOLQVWDELOLW\DFURVVWKH0LGGOH(DVWUHJLRQDQG
GLVUXSWHGODQGVDOHVGXULQJWKH\HDU
1(875$/
&XUUHQWSULFH65 3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$/$5.$1$%
ZZZDODUNDQFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
x 5HFHQWGHYHORSPHQWV
7
)UHHIORDW
)
2Q0DUFK6WDQGDUG3RRU¶VORZHUHG'DU$O$UNDQ¶VUDWLQJWR%
IURP%%DQGNHSWLWRQ&UHGLW:DWFKDVWKHDJHQF\EHOLHYHVWKHFRPSDQ\
IDFHVUHILQDQFLQJULVN7KHFRPSDQ\KDVWRUHSD\65EQRIGHEWLQ
&RPSDQ\ILQDQFLDOV
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
(36
%936
65
65
$
$
(
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
9$/8$7,2108/7,3/(6
(
(
<R<
&$*5
(
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
'DU$O$UNDQ5+6
7236+$5(+2/'(56
.KDOLG$EGXOODK6KHODVK$O6KHODVK
<RXVHI$EGXOODK6KHODVK$O6KHODVK
+DGKORRO6DOHK0RKDPPHG$O
+DGKORRO
0DMHG$EGXO5DKPDQ$EGXO$]L]$O
4DVVLP
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH%ORRPEHUJ
205
5($/(67$7('(9(/230(17~0$<
.12:/('*((&2120,&&,7<
$/62.12:1$6.(&0$',1$+
.QRZOHGJH(FRQRPLF&LW\&RPSDQ\ZDVHVWDEOLVKHGLQ
$XJXVWZLWKDFDSLWDORI65EQ+HDGTXDUWHUHGLQ
-HGGDKWKHFRPSDQ\LVPDLQO\HQJDJHGLQPDQDJLQJWKH
GHYHORSPHQWRIWKH.QRZOHGJH(FRQRPLF&LW\.(&SURMHFW
DW$O0DGLQDK$O0XQDZDUDKZLWKDQLQYHVWPHQWRI65EQ
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
.(&0DGLQDKLVUHVSRQVLEOHIRUGHYHORSLQJDVXVWDLQDEOHNQRZOHGJHEDVHG
FLW\DQGDFHQWUDOEXVLQHVVGLVWULFWDORQJVLGHUHVLGHQWLDOSURMHFWVLQ0DGLQDK
7KHSURMHFWFRPSULVHVUHVLGHQWLDOXQLWVVKRSVDQGUHWDLO
RXWOHWVDKLJKVSHHGUDLOWHUPLQDODQGDEXVLQHVVGLVWULFWFRPSULVLQJ
FRPSDQLHVIURPWKHHGXFDWLRQLQIRUPDWLRQDQGFRPPXQLFDWLRQWHFKQRORJ\
KHDOWKKRVSLWDOLW\DQGWRXULVPVHFWRUV7KHFRPSDQ\ZRXOGDOVRXQGHUWDNH
LQYHVWPHQWVLQDYDULHW\RIUHDOHVWDWHDVVHWVDQGSURYLGHDUDQJHRIUHDO
HVWDWHUHODWHGVHUYLFHV
x )LQDQFLDOV
.(&0DGLQDKUHSRUWHGUHYHQXHVRI65PQIRUZLWKDQ(%,7'$RI
65PQDQGDQHWORVVRI65PQ7KHFRPSDQ\UHSRUWHGDQHWORVVRI
65PQGXULQJWKHILUVWPRQWKVRIRSHUDWLRQVDVLWIDLOHGWRFRYHULQLWLDO
VHWXSFRVWVJLYHQWKHIDFWWKDWPDMRULW\RIWKHFRPSDQ\¶VSURMHFWVDUHVWLOO
XQGHUGHYHORSPHQW
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
x 5HFHQWGHYHORSPHQWV
,Q$SULO.(&0DGLQDKDQQRXQFHGWKHVDOHRIDVTPWUODQG
WRWKH,QWHUQDWLRQDO0HGLFDO&HQWHUIRUDWRWDOYDOXHRI65PQ\LHOGLQJD
SURILWRI65PQ
.(&$%
ZZZPDGLQDKNHFFRP
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
2Q'HFHPEHUWKHFRPSDQ\VLJQHGD65PQDJUHHPHQWWR
DFTXLUH6DYROD¶VVWDNHLQ$O0XMDPDDW8QLWHG&RPSDQ\IRUUHDOHVWDWH
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
ILQDQFLDOVDUHIRUPRQWKSHULRG
10
10
10
<R<
1$
10
&$*5
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
3%[
36[
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
.QRZOHGJH(FR5+6
6RXUFH%ORRPEHUJ
7236+$5(+2/'(56
.LQJ$EGXOODKELQ$EGXO$]L]
)RXQGDWLRQ
.QRZOHGJH(FRQRPLF&LW\
6DYROD*URXS
6RXUFH 7DGDZXO 1&%& 5HVHDUFK
206
5($/(67$7('(9(/230(17~0$<
-$%$/20$5'(9(/230(17
&203$1<
$/62.12:1$6-$%$/20$5-2'&
-DEDO2PDU'HYHORSPHQW&RPSDQ\-DEDO2PDULVHQJDJHG
LQUHDOHVWDWHGHYHORSPHQWLQWKH-DEDO2PDUDUHD,Q
FRRSHUDWLRQZLWKORFDODQGLQWHUQDWLRQDOVXEFRQWUDFWRUVWKH
FRPSDQ\SXUFKDVHVEXLOGVGHYHORSVPDQDJHVUHQWDQG
OHDVHVDQGVHOOVODQGDQGSURSHUWLHV-DEDO2PDU¶V
KHDGTXDUWHUVDUHORFDWHGLQ0HFFDDQGZDVHVWDEOLVKHGLQ
2FWREHU
x %XVLQHVVEULHI
-DEDO2PDUEXLOGVUHVLGHQWLDOWRZHUVKRWHOVFRPPHUFLDOFHQWHUVDQGURDGV
DQGSDUNLQJIDFLOLWLHVIRUSLOJULPVYLVLWLQJ0HFFD7KHFRPSDQ\¶VPDMRU
YHQWXUH-DEDO2PDUSURMHFWDOVRNQRZQDVWKH:HVWHUQ*DWH5RDG
'HYHORSPHQWLVVFKHGXOHGIRUFRPSOHWLRQLQ7KHSURMHFWLVDPL[HG
XVHPXOWLSKDVHSURMHFWVSDQQLQJDFURVVPLOOLRQVTXDUHPHWHURI
GHYHORSPHQWDUHDORFDWHGDURXQGWKH*UDQG0RVTXHRI0DNNDK7KHILUVW
SKDVHRIWKHSURMHFWLVH[SHFWHGWREHFRPSOHWHGLQHDUO\DQGZLOO
FRPSULVHFRQVWUXFWLRQRIKRWHOVYLOODVDQGUHVLGHQWLDOXQLWV7KH
VHFRQGSKDVHZLOOEHFRPSOHWHGE\
x )LQDQFLDOV
-DEDO2PDUGLGQRWUHFRUGVDOHVLQDVLWVSURMHFWVZHUHVWLOOXQGHUWKH
GHYHORSPHQWSKDVH7KHFRPSDQ\FRQWLQXHGWRLQFXUDQHWORVV65PQ
GXHWRODFNRIRSHUDWLQJLQFRPHDQGDULVHLQJHQHUDODGPLQLVWUDWLYH
H[SHQVHVIRUGHYHORSPHQWRISURMHFWV
127&29(5('
&XUUHQWSULFH65
3ULFLQJDVRI
672&.'(7$,/6
ZHHNUDQJH+/65
0DUNHWFDS65PQ
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
0
0
0
$EVROXWH
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
2Q0DUFK-DEDO2PDUVLJQHGDPRQWKFRQWUDFWZRUWK65EQ
ZLWK$]PHHO&RQWUDFWLQJDQG6DXGL$UDELDQ%D\WXUWRFRPSOHWHWKHVHFRQG
SKDVHRIWKH-DEDO2PDU3URMHFW7KHSURMHFWZRXOGEHILQDQFHGWKURXJKD
ULJKWVLVVXH
2Q'HFHPEHUWKHFRPSDQ\VLJQHGDORDQDJUHHPHQWZRUWK65EQ
ZLWKWKH0LQLVWU\RI)LQDQFHWRIXQGWKHWZLQWRZHUVDQGDVKRSSLQJPDOO
SURMHFW7KHORDQZRXOGEHUHSDLGLQHLJKW\HDUVDQGKDVDWZR\HDUJUDFH
SHULRG
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
-20$5$%
ZZZMDEDORPDUFRPVD
7$6,IUHHIORDWZHLJKW
)
9$/8$7,2108/7,3/(6
$
$
$
3([
10
10
10
3%[
36[
10
10
10
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
&RPSDQ\ILQDQFLDOV
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
7
)UHHIORDW
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
:(,*+7,1*)5(()/2$7
x 5HFHQWGHYHORSPHQWV
10
10
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
10
10
10
10
10
10
<R<
10
10
10
&$*5
10
10
10
10
6+$5(35,&(3(5)250$1&(
0D\
7$6,
6HS
0D\
-DQ
-DEDO2PDU5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
-DEDO2PDU(VWDEOLVKPHQW
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
0DNNDK&RQVWUXFWLRQ
'HYHORSPHQW&R
6RXUFH7DGDZXO1&%&5HVHDUFK
207
5($/(67$7('(9(/230(17~0$<
0$..$+&216758&7,21
$/62.12:1$60&'&
0DNNDK&RQVWUXFWLRQ'HYHORSPHQW&R0&'&ZDV
HVWDEOLVKHGLQWRGHYHORSDUHDVDURXQGWKH+RO\0RVTXH
LQ0DNNDK7KHFRPSDQ\LVHQJDJHGLQWKHUHGHYHORSPHQWRI
WKH+RO\+DUDPDUHD0&'&FRPPHQFHGDUHVLGHQWLDODQG
FRPPHUFLDOFRPSOH[LQFOXGLQJWKH-DEDO2PDUDQG-DEDO
.KDQGDPDSURMHFWV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
0&'&LVLQYROYHGLQUHDOHVWDWHLQYHVWPHQWFRQVWUXFWLRQDQGGHYHORSPHQW 672&.'(7$,/6
SURSHUW\PDQDJHPHQWDQGKRWHOPDQDJHPHQW7KHFRPSDQ\KROGV
ZHHNUDQJH+/65
VWDNHLQ0DNNDK+LOWRQ7RZHUVWKHURRPKRWHODQG0DNNDK
0DUNHWFDSPQ
6KRSSLQJ&HQWHUDWKUHHVWRULHGXQLWVKRSSLQJFHQWHU0&'&DOVR
6KDUHVRXWVWDQGLQJPQ
KROGVVWDNHLQ7DNLHI&RPSDQ\,Q0&'&ZDVDIRXQGLQJ
3ULFHSHUIRUP 0
PHPEHURIWKH-DEDO2PDU'HYHORSPHQW&RPSDQ\VWDNHWKDWZDV
$EVROXWH
HVWDEOLVKHGZLWKDFDSLWDORI65EQ7KH-DEDO2PDUSURMHFWLVVSUHDGDFURVV
0DUNHW
DQDUHDRIVTPWUVDQGLQFOXGHVKRWHOVFRPPHUFLDOFHQWHUVDQG
6HFWRU
SUD\HUIDFLOLWLHVIRURYHUSHRSOH
x )LQDQFLDOV
0&'&¶VUHYHQXHVJUHZ<R<WR65PQLQPDLQO\GULYHQE\
KLJKHURFFXSDQF\UDWHVLQUHVLGHQWLDOKRWHOV1HWLQFRPHURVH<R<WR
65PQLQWKHVDPHSHULRGSULPDULO\GXHWRKLJKHUDYHUDJHURRPUDWHV
UHDOL]HGLQWKH+DMMVHDVRQDQGLQFUHDVHGUHQWDOLQFRPHVIURPVKRSV
0
0
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
0&'&2$%
ZZZPFGFFRPVD
x 5HFHQWGHYHORSPHQWV
2Q$XJXVW0&'&DSSURYHGWKHGLVWULEXWLRQRI65SHUVKDUH
FDVKGLYLGHQGIRUWKH\HDUHQGLQJ0DUFK
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK<HDUHQGLQJLVVW0DUFK
<R<
&$*5
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
0DNNDK5+6
6RXUFH5HXWHUV
7236+$5(+2/'(56
6DXGL%LQ/DGHQ*URXS
0RKDPPHG6DODK+DP]D6DLUDIL
6RXUFH7DGDZXO1&%&5HVHDUFK
208
REAL ESTATE DEVELOPMENT MAY 2012
EMAAR THE ECONOMIC CITY
ALSO KNOWN AS EEC, EMAAR EC
In 2006, Emaar Economic City (Emaar EC), managed by Emaar
Properties, was set up as a joint stock company to develop
the SR188bn King Abdullah Economic City (KAEC). KAEC is
part of the government’s initiatives to diversify the economy
and establish new economic, educational, and technology
hubs.
NOT COVERED
Current price (SR)
12.1
Pricing as of 09-05-2012
 Business brief
KAEC, the single largest private sector-led project in the GCC region (168
million square meters), has six key components: a seaport, an industrial
zone, a residential district, a financial island, an educational zone and a
waterside zone. This mega project is expected to generate about 1-2mn job
opportunities with the residential district expected to house around 2mn
people.
 Financials
Emaar EC’s revenues grew 348.4% YoY to SR408mn in 2011 due to a land
sale. The company reported a net profit of SR83mn in 2011 versus a net loss
of SR584mn in 2010.
 Recent developments
In January 2012, the company sold 500,000 square meters of land in KAEC’s
Industrial Valley to Tamer Group, a leading healthcare and consumer goods
firm based in Jeddah.
STOCK DETAILS
52-week range H/L (SR)
14/6
Market cap (SR mn)
2,742
Shares outstanding (mn)
Price perform (%)
850
1M
3M
12M
Absolute
(8.0)
40.7
69.2
Market
(6.2)
6.2
7.6
Sector
(2.6)
31.1
40.0
Avg daily turnover (mn)
SR
US$
3M
417.1
111.2
12M
164.0
43.7
Reuters code
4220.SE
Bloomberg code
EMAAR AB
www.kingabdullahcity.com
WEIGHTING & FREEFLOAT (%)
TASI (free float weight)
0.51
Free float
30.0
VALUATION MULTIPLES
P/E (x)
Company financials
Revenues
EBITDA
Net Income
Assets
Equity
Total Debt
Cash & Equiv
EBITDA Mgn
Net Mgn
ROE
ROA
Div Payout
EPS
BVPS
SRmn
SRmn
SRmn
SRmn
SRmn
SRmn
SRmn
%
%
%
%
%
SR
SR
2008
102
(375)
(292)
9,532
8,191
0
2,219
NM
NM
(3.5)
(3.2)
(0.34)
9.64
Source: Tadawul, Zawya, Company, NCBC Research
2009
261
(214)
(309)
9,305
7,882
0
864
NM
NM
(3.8)
(3.3)
(0.36)
9.27
2010
91
(249)
(584)
8,877
7,298
0
339
NM
NM
(7.7)
(6.4)
(0.69)
8.59
2011
408
170
83
13,746
7,380
5,062
1,710
41.7
20.3
1.1
0.7
0.10
8.68
YoY
(%)
348.4
NM
NM
54.8
1.1
NM
404.0
NM
1.1
CAGR (%)
(08-11)
58.9
NM
NM
13.0
(3.4)
NM
(8.3)
NM
(3.4)
09A
10A
11A
NM
NM
124.5
P/B (x)
1.3
1.4
1.4
P/S (x)
39.5
113.1
25.2
Div Yield (%)
-
-
-
DPS
-
-
-
Source: NCBC Research estimates
SHARE PRICE PERFORMANCE
8,000
7,500
7,000
6,500
6,000
5,500
May-11
TASI
Sep-11
Jan-12
15
13
11
9
7
5
May-12
Emaar E .C (RHS)
Source: Reuters
TOP 5 SHAREHOLDERS (%)
Modern Daim Real Estate
ME Royal Capital Co.
Emaar Middle East
MI Holding Compnay
ME Strategic Investments
20.0
9.4
5.8
5.8
5.8
Source: Tadawul, NCBC Research
209
5($/(67$7('(9(/230(17~0$<
$55,<$'+'(9(/230(17
$/62.12:1$6$55,<$'+$5'&2
$UUL\DGK'HYHORSPHQW&RPSDQ\ZDVHVWDEOLVKHGLQDQG
LVHQJDJHGLQWKHFRQVWUXFWLRQRIFRPPHUFLDORIILFHDQG
UHVLGHQWLDOEXLOGLQJVDQGFRPSOH[HV7KHFRPSDQ\DOVR
GHYHORSVSXEOLFSDUNVWRXULVWFRPSRXQGVDQGSDUNLQJORWV
127&29(5('
&XUUHQWSULFH65 3ULFLQJDVRI
x %XVLQHVVEULHI
$UUL\DGKLVHQJDJHGLQUHVLGHQWLDOSURMHFWVVXFKDV6XQULVH&LWLHVDQG
FRPPHUFLDOSURMHFWVVXFKDV$WWDPHHU7UDGLQJ&HQWHU$UUL\DGK
7UDQVSRUWDWLRQ&HQWHU7HFKQLFDO6HUYLFH&LW\5L\DGK+LOOVDQG5L\DGK&DU
$XFWLRQIRUVDOHRIXVHGFDUV7KHFRPSDQ\LVDOVRHQJDJHGLQWKH
GHYHORSPHQWRIPDUNHWDUHDVVXFKDV%DWLKD0HDW9HJHWDEOH0DUNHW
5L\DGK:KROHVDOH5HWDLO0DUNHWDQG5L\DGK9HJHWDEOH)UXLWV0DUNHW
x )LQDQFLDOV
672&.'(7$,/6
ZHHNUDQJH+/65
6KDUHVRXWVWDQGLQJPQ
3ULFHSHUIRUP
$UUL\DGK¶VUHYHQXHVLQFUHDVHG<R<WR65PQLQGXHWR
UHYHQXHJURZWKLQWKHRSHUDWLRQOHDVHVHJPHQWDQGDPDUNHG
LPSURYHPHQWLQRSHUDWLRQDOHIILFLHQF\DQGPDUNHWLQJVWUDWHJ\RIDOOSURMHFWV
1HWLQFRPHLQFUHDVHG<R<WR65PQ1HWPDUJLQVH[SDQGHGWR
LQFRPSDUHGWR
x 5HFHQWGHYHORSPHQWV
$UUL\DGKDZDUGHGD65PQFRQWUDFWWRDORFDOFRPSDQ\WRGHYHORSD
FRROLQJDQGIUHH]LQJSODQWRQLWVODQGLQ5L\DGK7KHSODQWLVH[SHFWHGWR
JHQHUDWH65PQUHQWDOLQFRPHDQQXDOO\$GGLWLRQDOO\,Q0DUFK
$UUL\DGK¶VERDUGDSSURYHGGLVWULEXWLRQRIRU65SHUVKDUHDV
FDVKGLYLGHQGVIRU
0DUNHWFDSPQ
$EVROXWH
0
0
0
0DUNHW
6HFWRU
$YJGDLO\WXUQRYHUPQ
65
86
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
$'&2$%
ZZZDUGFRFRPVD
:(,*+7,1*)5(()/2$7
7$6,IUHHIORDWZHLJKW
)UHHIORDW
9$/8$7,2108/7,3/(6
&RPSDQ\ILQDQFLDOV
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
<R<
1$
&$*5
1$
$
$
$
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
6+$5(35,&(3(5)250$1&(
0D\
6HS
7$6,
-DQ
0D\
$UUL\DGK'HYHORSPHQW5+6
7236+$5(+2/'(56
'HYHORSPHQW,QYHVWPHQW6HU
&R
(PDU$UDELDQ6KLHOGIRU,QYVW&R
$G\DDU+ROGLQJ&R
6RXUFH7DGDZXO1&%&5HVHDUFK
6285&(%/220%(5*
210
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Transport
Ticker
Company
Page No.
4030
NSCSA
214
4040
SAPTCO
215
4260
Budget Saudi
216
4110
Mubarrad
217
0$<
75$163257
6HFWRUQRUPDOL]HVDPLGZHDNJOREDOHFRQRPLF
DFWLYLW\
7KH6DXGLWUDQVSRUWVHFWRUFRQWLQXHGWRFRQVROLGDWHLQ
UHSRUWLQJDJUDGXDOUHFRYHU\+RZHYHUFRQWLQXHGXQFHUWDLQW\
DERXWJOREDOHFRQRPLFUHFRYHU\QHJDWLYHO\LPSDFWHGWUDGHIORZV
DQGFDUJRYROXPHV1RQHWKHOHVVWKHJRYHUQPHQW¶VFRPPLWPHQW
WRZDUGEXLOGLQJDUREXVWWUDQVSRUWLQIUDVWUXFWXUHVXSSRUWHGWKH
UHFRYHU\LQWKHVHFWRU7KHJRYHUQPHQWLQFUHDVHGLWVSURVSHFWLYH
VSHQGLQJRQWUDQVSRUWDQGFRPPXQLFDWLRQE\<R<RURI
WKHWRWDOVSHQGLQJHDUPDUNHGLQWKHEXGJHW7KHVHFWRUDOVR
EHQHILWVIURPWKHVWURQJSRWHQWLDORIUHOLJLRXVWRXULVPDVZHOODV
JURZLQJGHPDQGIURPWKHQRQRLOVHFWRUDPLGWKHJRYHUQPHQW¶V
LQFUHDVLQJIRFXVRQGLYHUVLILFDWLRQ
*URZWKLQWKHWUDQVSRUWVHFWRUUHPDLQHGUHODWLYHO\IODWFRPSDUHGWRRWKHU*&&
FRXQWULHVLQ1RQHWKHOHVVWKHVHFWRU¶V52(VWRRGDWKLJKHUWKDQ
WKH*&&DYHUDJHRIGXULQJWKHVDPHSHULRG
Exhibit 123: Revenues of GCC transport companies,
2009±11
Exhibit 124: Comparison of ROE and P/E of GCC
companies, 2011
86'PQ
52(
3([
.6$
8$(
.XZDLW
2PDQ
4DWDU
6RXUFH%ORRPEHUJ1&%&5HVHDUFK
.6$
8$(
.XZDLW
2PDQ
4DWDU
6RXUFH7DGDZXO%ORRPEHUJ1&%&5HVHDUFK6L]HRIWKHEXEEOHUHSUHVHQWVPDUNHWFDS
DVRQ0DUFK
7KHWUDQVSRUWVHFWRUKDVDODUJHQXPEHURISULYDWHSOD\HUVZLWKMXVWIRXUOLVWHG
FRPSDQLHV$PRQJWKHOLVWHGHQWLWLHV1DWLRQDO6KLSSLQJ&RRI6DXGL$UDELD
16&6$FRPPDQGVWKHODUJHVWVKDUHDFFRXQWLQJIRUDURXQGRIWKH
VHFWRU¶VUHYHQXHVLQ
7KHVHFWRUFRQVWLWXWHGRIWKHWRWDOZHLJKWLQWKH7DGDZXOLQGH[DVRI
0DUFK$PRQJOLVWHGHQWLWLHV16&6$KROGVWKHKLJKHVWZHLJKW
LQWKHLQGH[
Exhibit 125: Sector details
8QLWVDVVWDWHG
Country
% weight in Index NIM (%), Avg. RoE (%),
as on 25 Mar 2012
2011
2011
1DWLRQDO6KLSSLQJ&RRI6DXGL$UDELD16&6$
6DXGL3XEOLF7UDQVSRUW&R6$37&2
6DXGL7UDQVSRUWDQG,QYHVWPHQW&R08%$55$'
8QLWHG,QWHUQDWLRQDO7UDQVSRUWDWLRQ&R/WG%8'*(7
6RXUFH%ORRPEHUJ7DGDZXO&RPSDQ\GDWD
212
75$163257
1&%&$3,7$/
0$<
7KHVHFWRU¶VUHYHQXHVURVHRQO\<R<WR65EQLQSULPDULO\GXHWRD
VXEVWDQWLDOGHFUHDVHLQYROXPHVDQGVHOOLQJSULFHVE\WKHHQGRIWKH\HDU7KH
VHFWRU¶VWZRELJJHVWSOD\HUVH[KLELWHGPL[HGSHUIRUPDQFHVLQ16&6$¶V
UHYHQXHVIHOO<R<ZKLOH6$37&2UHFRUGHGDVKDUSLQFUHDVHRI<R<
6DXGLWUDQVSRUWDQGLQYHVWPHQW&RPSDQ\08%$55$'WKHVPDOOHVWSOD\HULQ
WKHVHFWRUUHFRUGHGWKHVWHHSHVWGHFOLQHLQUHYHQXHVGRZQ<R<LQ
7KHVHFWRU¶VSURILWDELOLW\GLSSHG<R<DVWKHVKRUWDJHRIVNLOOHGODERUDQG
LQKHUHQWLQIODWLRQLQFUHDVHGH[SHQVHV6$37&2UHFRUGHGWKHKLJKHVWJURZWKLQ
QHWSURILWXS<R<LQZKLOH08%$55$'UHSRUWHGRYHUWHQIROG
GHFUHDVHLQSURILWV
Exhibit 126: Revenue of companies, 2009±2011
Exhibit 127: NSCSA¶V profitability relative to the sector
avg
65PQ
08%$55$'
16&6$
6$37&2
%8'*(7
$YHUDJ H
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
16&6$
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
7KHVHFWRU¶V3(DQG3%9PXOWLSOHVVWRRGDW[DQG[LQ
UHVSHFWLYHO\[DQG[LQWKHSUHYLRXV\HDU7KHWUDQVSRUWVHFWRU¶V
DYHUDJH52(VWRRGDWLQ8QLWHG,QWHUQDWLRQDO7UDQVSRUW&RPSDQ\
/LPLWHGUHSRUWHGWKHKLJKHVW52(RIGXULQJWKHVDPH\HDU
Exhibit 128: Comparison of P/B and RoE, 2010
Exhibit 129: Comparison of P/B and RoE, 2011
6$37&2
3%[
08%$55$'
%8'*(7
6$37&2
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
16&6$
08%$55$'
52(
16&6$
52(
%8'*(7
%8'*(7
16&6$
6$37&2
3%[
%8'*(7
6$37&2
16&6$
08%$55$'
6RXUFH%ORRPEHUJ7DGDZXO1&%&5HVHDUFK
$OWKRXJKWKHRXWORRNIRUWKHVHFWRUUHPDLQVPL[HGDSURVSHFWLYHLQFUHDVHLQ
H[SDQVLRQSURMHFWVDQGLQIUDVWUXFWXUHGHYHORSPHQWDFWLYLWLHVDFURVVLQGXVWULHV
FRXOGVXSSRUWWKHORFDOIUHLJKWLQGXVWU\7KH.LQJGRPFRQWLQXHVWRZLWQHVVD
VWHDG\VXSSO\RISURMHFWV,Q'HFHPEHUWKH0LQLVWU\RI7UDQVSRUWDQG
81'3VLJQHGDQDJUHHPHQWWRGHYHORSDWUDQVSRUWV\VWHPLQ6DXGL$UDELDWKH
SURMHFWZDVDSSURYHGIRUILYH\HDUV±$OVRZRUNRQ-HGGDK¶VQHZ.LQJ
$EGXOD]L]$LUSRUWVL[RWKHUDLUSRUWXSJUDGHVDQGNPRIQHZURDGVDUHLQ
SURJUHVV,QDGGLWLRQXQGHUWKHEXGJHWWKHJRYHUQPHQWUDLVHGWKH
PXQLFLSDOVSHQGLQJODUJHO\RQWUDIILFLQIUDVWUXFWXUHXSJUDGHVE\WRRI
WKHRYHUDOOSURSRVHGVSHQGLQJIRU
213
75$163257~0$<
1$7,21$/6+,33,1*&203$1<
$/62.12:1$616&6$
Established in 1979, The National Shipping Company of Saudi
Arabia (NSCSA) provides marine transport services primarily
to oil & gas and chemical sectors. NSCSA offers liner (general
cargo), ship management, and container storage and repair
services.
NOT COVERED
Current price (SR)
17.1
3ULFLQJDVRI
x Business brief
16&6$RSHUDWHVDIOHHWRIVKLSVRLOWDQNHUVFKHPLFDOWDQNHUVDQG
IRXUJHQHUDOFDUJRV7KHFRPSDQ\LVOLNHO\WRDGGXSWRFKHPLFDOFDUULHUV
STOCK DETAILS
WRLWVH[LVWLQJIOHHWE\16&6$RSHUDWHVFKHPLFDOWDQNHUVWKURXJK
ZHHNUDQJH+/65
1DWLRQDO&KHPLFDO&DUULHUV1&&LWVRZQHGVXEVLGLDU\$ORQJZLWK
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
WUDQVSRUWDWLRQWKHFRPSDQ\RIIHUVVKLSPDQDJHPHQWVHUYLFHVIRULWVRZQ
YHVVHOVDQGRWKHUVKLSSLQJFRPSDQLHVWKURXJKLWVZKROO\RZQHGVXEVLGLDU\
Price perform (%) 1M
0LGHDVW6KLS0DQDJHPHQW
$EVROXWH
x Financials
16&6$¶VVDOHVGHFOLQHG<R<WR65PQLQDVWKUHHYHU\ODUJH
FUXGHFDUULHU9/&&WLPHFKDUWHUFRQWUDFWVRZQHGE\16&6$H[SLUHGGXULQJ
WKH\HDU7KHFRPSDQ\¶V(%,'7$IHOOWR65PQDQGQHWLQFRPH
GHFUHDVHGWR65PQPDLQO\GXHWRULVLQJFRVWRIYHVVHOEXQNHUV
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
x Recent developments
16&6$DQG*HUPDQ\EDVHG5:(6XSSO\7UDGLQJGHFLGHGWRWHUPLQDWHD
WKUHH\HDUFRQWUDFWH[SLULQJRQ$SULORQ$SULO5:(
DJUHHGWRSD\DFRPSHQVDWLRQRI65PQZKLFKZRXOGEHUHIOHFWHGLQ
4
2Q0DUFKWKHFRPSDQ\VLJQHGDFRQWUDFWZLWK4$7$/80DQ
DOXPLQXPFRPSDQ\WRWUDQVSRUWDOXPLQXPVKLSPHQWVIURP4DWDUWRWKH86
IRURQH\HDU7KHHVWLPDWHGYDOXHRIWKHFRQWUDFWLV65PQ
6(
%ORRPEHUJFRGH
16&6$$%
ZZZQVFVDFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
3([
09A
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
COMPANY FINANCIALS
65PQ
5HYHQXHV
65PQ
(%,7'$
65PQ
1HW,QFRPH
65PQ
$VVHWV
65PQ
(TXLW\
65PQ
7RWDO'HEW
65PQ
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
65
(36
65
%936
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR(%)
(08-11)
SHARE PRICE PERFORMANCE
0D\
6HS
-DQ
7$6,
0D\
6KLSSLQJ5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
3XEOLF,QYHVWPHQW)XQG
6RXUFH7DGDZXO1&%&5HVHDUFK
214
75$163257~0$<
6$8',38%/,&75$163257
&203$1<
$/62.12:1$66$37&2
Saudi Public Transport Company (SAPTCO) provides bus
transport services for domestic and international travel to
neighboring countries such as Egypt, Syria, Jordan, Kuwait,
Qatar, the UAE, Bahrain, Yemen, Sudan, and Lebanon.
Headquartered in Riyadh, the company has about 161 local
and international agents.
x Business brief
NOT COVERED
Current price (SR)
15.9
3ULFLQJDVRQ
6$37&2KDVDIOHHWRIDURXQGEXVHVWUXFNVFDUVDQG
WUDLOHUV,WVRSHUDWLRQVFRQQHFWQHDUO\FLWLHVWRZQVDQGYLOODJHVDFURVV
WKH.LQJGRP7KHFRPSDQ\SURYLGHVLQWUDFLW\DQGLQWHUFLW\WUDQVSRUW
VHUYLFHVDFURVV6DXGL$UDELDDQGLQWHUQDWLRQDOWUDQVSRUWVHUYLFHVWR
QHLJKERULQJFRXQWULHV6$37&2DOVRRIIHUVFRQWUDFWDQGFKDUWHU
WUDQVSRUWDWLRQVHUYLFHVWRVFKRROVFROOHJHVDQGRWKHUJURXSV)XUWKHUPRUHLW
SURYLGHVVSHFLDOWUDQVSRUWVHUYLFHVWR0HFFDDQG0HGLQDGXULQJ+DMMDQG
8PUDKVHDVRQV7KHFRPSDQ\DOVRRIIHUVSUHPLXPVHUYLFHVEHWZHHQ
0DNNDKDQG0DGLQDK5L\DGKDQG$O.KREDUDQGWR%DKUDLQ6$37&2LV
SODQQLQJWRH[SDQGWKHVHURXWHV$GGLWLRQDOO\WKHFRPSDQ\SURYLGHV
DGYHUWLVLQJVSDFHRQLWVEXVHV
x Financials
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6$37&2¶VUHYHQXHLQFUHDVHG<R<WR65PQLQIURP
65PQLQ7KHJURZWKZDVPDLQO\GXHWRDQLQFUHDVHLQSHUIRUPDQFH
GXULQJ5DPDGDQDQG+DMMVHDVRQV1HWLQFRPHURVHVLJQLILFDQWO\WR65PQ
LQIURP65PQLQWKHSUHYLRXVILVFDO\HDURQKLJKHURSHUDWLRQDO
SHUIRUPDQFH
6(
%ORRPEHUJFRGH
6$37&2$%
ZZZVDSWFRFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
x Recent developments
6$37&2DFTXLUHG7UDYLFR0HUFHGHVEXVHV0RGHOIRU
65PQLQWKUHHEDWFKHVGXULQJ6HSWHPEHUWR)HEUXDU\2XW
RIWKHVHWKHODVWEDWFKRIEXVHVZDVUHFHLYHGLQ)HEUXDU\IRU
65PQWKHHIIHFWRIWKHVDPHZRXOGEHUHIOHFWHGLQ4
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0D\
6HS
-DQ
7$6,
0D\
6$37&25+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
3XEOLF,QYHVWPHQW)XQG
6XOHLPDQ6DOHK6XOHLPDQ$ODPUL
6RXUFH7DGDZXO1&%&5HVHDUFK
215
75$163257~0$<
81,7(',17(51$7,21$/
$/62.12:1$6%8'*(76$8',81,75$168,7&
United International Transportation Co. (Budget Saudi) is the
largest car rental company in the MENA region. It is a
franchisee of Budget International and operates more than
19,361 vehicles, including luxury, 4x4, full-size, intermediate,
compact, and economy cars.
NOT COVERED
Current price (SR)
42.4
3ULFLQJDVRI
STOCK DETAILS
x Business brief
%XGJHW6DXGLSURYLGHVYDULRXVVHUYLFHVVXFKDVVKRUWWHUPDQGORQJWHUPFDU
UHQWDOVFKDXIIHXUGULYHQFDUVWKH&RUS5DWH3URJUDPDFRUSRUDWHFOLHQW
RULHQWHGVHUYLFHZLWKSUHIHUHQWLDOUDWHVDQGYDOXHDGGLWLRQVVXFKDVIDVWHU
UHVHUYDWLRQVDQGIOH[LEOHELOOLQJDQG%XGJHW([SUHVVOR\DOW\SURJUDPIRU
PHPEHUV7KHFRPSDQ\DOVRRIIHUV+DMM8PUDKVHUYLFHVIRUYLVLWRUVDQG
SLOJULPV/RGJHDQG'ULYHDFFRPPRGDWLRQDORQJZLWKFDUUHQWDO3UHPLHU
/LPRXVLQH6HUYLFHFKDXIIHXUGULYHQOX[XU\YHKLFOHVDQGDXWRPRWLYH
PDLQWHQDQFHPDLQWHQDQFHIDFLOLWLHVLQFOXGLQJVDWHOOLWHZRUNVKRSV%XGJHW
6DXGLDOVRVHOOVXVHGFDUV
x Financials
7KHFRPSDQ\¶VVDOHVJUHZ<R<WR65PQLQGXHWRDULVHLQ
VKRUWDQGORQJWHUPOHDVLQJUHYHQXHV(%,7'$WRRURVH<R<WR
65PQGXULQJWKH\HDUFRPSDUHGWR65PQODVW\HDU1HWLQFRPHIRU
H[SDQGHG<R<PDLQO\GXHWRKLJKHUUHYHQXHIURPUHQWDOVORQJ
DQGVKRUWWHUPDQGJDLQIURPFDUVDOHVFRPSDUHGWRODVW\HDU
x Recent developments
2Q0DUFK%XGJHW6DXGLH[WHQGHGWKH0HPRUDQGXPRI
8QGHUVWDQGLQJ0R8ZLWK7UDQ]OHDVH+ROGLQJV,QGLDWRDFTXLUHD
VWDNHLQWKHODWWHUWKH0R8ZDVH[WHQGHGE\WZRPRQWKVDQGZRXOGHQGRQ
0D\
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
0DUNHW
6HFWRU
$EVROXWH
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
%8'*(7$%
ZZZEXGJHWVDXGLFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
2Q-DQXDU\WKH&0$DSSURYHG%XGJHW6DXGL¶VUHTXHVWWRLQFUHDVH
LWVFDSLWDOIURP65PQWR65PQWKURXJKWKHLVVXHRIRQHERQXVVKDUH
IRUHYHU\WKUHHVKDUHVRZQHGE\WKHVKDUHKROGHUV
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
SHARE PRICE PERFORMANCE
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
2008
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0D\
6HS
7$6,
-DQ
0D\
%XGJHW6DXGL5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
$O=DKLG+ROGLQJ*URXS
$EGXO(ODK$EGXOODK0DKPRRG$OL
=DKLG
0RKDPPHG$EGXOODK0DKPRRG
=DKLG
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
216
75$163257~0$<
08%$55$'
$/62.12:1$6
Saudi Transport and Investment Company (Mubarrad) runs a
land transport business across Saudi Arabia and other GCC
countries. It also deals in the purchase and sale of land,
construction, and management and operation of buildings.
NOT COVERED
Current price(SR)
52.0
3ULFLQJDVRI
x Business brief
0XEDUUDGRZQVDIOHHWRIPRUHWKDQYHKLFOHVLQFOXGLQJWUXFNKHDGV
UHHIHUWUDLOHUVUHHIHUWUXFNVIODWWUXFNVIRUGU\WUDQVSRUWDQGWUDLOHUVIRUEXON
WUDQVSRUWIRUFDUU\LQJDOOW\SHVRIJHQHUDODQGLQGXVWULDOFDUJR7KHFRPSDQ\
STOCK DETAILS
SURYLGHVVHUYLFHVVXFKDVKDQGOLQJZDUHKRXVLQJDQGGHOLYHU\RIJRRGVDQG
ZHHNUDQJH+/6
PDWHULDOVZLWKLQWKH.LQJGRPE\URDGDLURUVHD0XEDUUDGDOVRRSHUDWHV
0DUNHWFDSPQ
([SUHVV3DUFHO6HUYLFHVDFURVV6DXGL$UDELD,QDGGLWLRQWKHFRPSDQ\
6KDUHVRXWVWDQGLQJPQ
FRQVWUXFWVPDQDJHVDQGOHDVHVFROGVWRUHVDQGWUDLOHUV
Price perform (%)
x Financials
$EVROXWH
0XEDUUDG¶VUHYHQXHVWRRGDW65PQLQGRZQFRPSDUHGWR
1HWORVVIRULQFUHDVHGVLJQLILFDQWO\WR65PQFRPSDUHGWRD
ORVVRI65PQLQ7KLVZDVPDLQO\GXHWRUHFRJQLWLRQRIORVVHV
DPRXQWLQJWR65PQIURPLQYHVWPHQWVHFXULWLHVDYDLODEOHIRUVDOH
x Recent developments
2Q)HEUXDU\0XEDUUDGDQQRXQFHGWKHUHFHLSWRIQHZWUXFNV
WKHLPSDFWRIWKLVZRXOGUHIOHFWLQWKHEXVLQHVVRSHUDWLRQVLQ4
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6/7&2$%
ZZZPXEDUUDGFRPVD
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
10
10
3%[
36[
'LY<LHOG
'36
6RXUFH%ORRPEHUJ
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
2009
2010
2011
YoY
(%)
10
10
10
CAGR (%)
(08-11)
10
10
10
0D\
6HS
7$6,
-DQ
0D\
0XEDUUDG5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
6RXUFH7DGDZXO1&%&5HVHDUFK
217
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Media & Publishing
Ticker
Company
Page No.
4210
SRMG
221
4070
Tihama
222
4270
SPPC
223
0$<
0(',$38%/,6+,1*
6KLIWWRZDUGGLJLWDOPHGLDWRGULYHJURZWK
7KHPHGLDDQGSXEOLVKLQJVHFWRUGLVSOD\HGSRRUSHUIRUPDQFHLQ
DIWHUUHFRUGLQJDVWURQJUHFRYHU\LQ$GYHUWLVLQJDQG
HGXFDWLRQDOSXEOLVKLQJEXVLQHVVHVZHUHUHVLOLHQWZKLOHWKH
WUDGLWLRQDOSULQWEXVLQHVVFRQWLQXHGWRGHFOLQHDVWKHLQGXVWU\
ZLWQHVVHGDVWUXFWXUDOVKLIWWRZDUGGLJLWDOPHGLD$QLPSURYHPHQW
LQWKHHFRQRP\LVOLNHO\WRGULYHJURZWKZLWKQHZHUPHGLXPVVXFK
DV,QWHUQHWDQGPRELOHJDLQLQJDGGLWLRQDODWWHQWLRQ
.6$GRPLQDWHVWKHPHGLDDQGSXEOLVKLQJVHFWRULQ*&&²UHYHQXHLQ.6$
DFFRXQWHGIRURIWKHWRWDO*&&UHYHQXHLQ,QWKH.LQJGRPWKH
VHFWRU¶VUHYHQXHVZHUHIODWLQDIWHUULVLQJ<R<LQ7KHVHFWRU
WUDGHGDWDQDGMXVWHG3(PXOWLSOHRI[ZKLFKLVWKHKLJKHVWDPRQJ*&&
SHHUV
Exhibit 130: Revenue of GCC print/media,
2009±11
Exhibit 131: Comparison of ROE & P/E of GCC companies,
2011
86'PQ
52(
3([
.6$
.XZDLW
.6$
%DK UDLQ
.XZDLW
%DK UDLQ
6RXUFH=DZ\D
6RXUFH=DZ\D
7KHPHGLDDQGSXEOLVKLQJVHFWRULQ6DXGL$UDELDFRPSULVHVWKUHHOLVWHG
FRPSDQLHVZKLFKFROOHFWLYHO\DFFRXQWIRUMXVWRIWKH7$6,$PRQJWKHVH
650*KDVWKHKLJKHVWZHLJKWRILQWKHLQGH[
Exhibit 132: Sector details
8QLWVDVVWDWHG
Country
% weight in Index
as of 28 Mar2012
6DXGL5HVHDUFK$QG0DUNHWLQJ*URXS650*
7LKDPD$GYHUWLVLQJ3XEOLF5HODWLRQV&R7LKDPD
6DXGL3ULQWLQJ3DFNDJLQJ&R633&
NIM (%),
2011
Avg. RoE (%),
2011
6RXUFH=DZ\D
5HYHQXHIURP.6$¶VPHGLDDQGSXEOLVKLQJVHFWRULQFUHDVHGDPDUJLQDO
<R<WR65EQLQ650*¶VUHYHQXHURVHWR65EQOHGE\KLJKHU
GHPDQGIRUDGYHUWLVLQJDQGHGXFDWLRQDOSXEOLFDWLRQ7KHFRPSDQ\EHLQJWKH
ODUJHVWSOD\HUOHGUHYHQXHJURZWKLQWKHLQGXVWU\650*¶VQHWLQFRPHJUHZ
WR65PQOHGE\ORZHULQSXWFRVWVDQGJDLQVIURPDVWDNHVDOHLQ
,QWLJUDODPHGLDILUP6LQFHWKHFRPSDQ\¶VQHWLQFRPHKDVEHHQULVLQJ
VWHDGLO\HYHQDVRWKHUSOD\HUVKDYHUHSRUWHGIODWRUGHFOLQLQJPDUJLQV2WKHU
SOD\HUV63&&DQG7LKDPDUHSRUWHGDGHFOLQHLQUHYHQXHDQG
219
0(',$38%/,6+,1*
1&%&$3,7$/
0$<
UHVSHFWLYHO\7KHDYHUDJHQHWLQFRPHPDUJLQLQWKHVHFWRUVWRRGDW
ZKLOH650*OHGZLWK7KLVLVPDLQO\DWWULEXWHGWRWKHFRPSDQ\¶V
VXFFHVVLQFRQWDLQLQJRSHUDWLQJFRVWV
Exhibit 133: Revenue of companies, 2009±11
Exhibit 134: Profitability of SRMG relative to sector
average
65PQ
650*
633 &
6HFWRUDYHUDJH
7LKDPD
6RXUFH7DGDZXO
650*
6RXUFH7DGDZXO
,QWKHVHFWRU¶VDGMXVWHG3(DQGDYHUDJH3%9VWRRGDW[DQG[
FRPSDUHGWR[DQG[UHVSHFWLYHO\LQ7KHVHFWRU¶VDYHUDJH52(
FRQWUDFWHGWRLQIURPLQPDLQO\DV7LKDPD¶V52(
GHFOLQHGWRIURPLQ
Exhibit 135: Comparison of P/B and ROE, 2010
Exhibit 136: Comparison of P/B and ROE, 2011
7LKDPD
650*
52(
52(
650*
633&
633&
7LKDPD
3%[
6RXUFH7DGDZXO%ORRPEHUJ
3%[
6RXUFH7DGDZXO%ORRPEHUJ
220
0(',$~0$<
6$8',5(6($5&+$1'
0$5.(7,1**5283
$/62.12:$6650*
Riyadh-based Saudi Research and Marketing Group (SRMG),
established in 1988, is a leading publishing group. Its
subsidiaries include Saudi Research and Publishing
Company, Saudi Distribution Company, Saudi Specialized
Publishing Company (SSPC), and Al Khaleejiah Advertising
and Public Relations Company.
x Business brief
NOT COVERED
Current price (SR)
26.0
3ULFLQJDVRI
650*LVHQJDJHGLQIRXUNH\DFWLYLWLHV±SXEOLVKLQJXQGHUWDNHVUHVHDUFK
DQGPDUNHWLQJDGYHUWLVLQJPDLQO\GHDOVZLWKSURGXFWLRQDQGPDUNHWLQJRI
DXGLRYLVXDOPHGLDSULQWLQJSULQWVQHZVSDSHUVPDJD]LQHVERRNVDQG
MRXUQDOVLQYDULRXVODQJXDJHVDQGGLVWULEXWLRQ
STOCK DETAILS
ZHHNUDQJH+/65
650*¶VUHYHQXHVJUHZWR65PQLQGXHWRKLJKHUUHYHQXH
IURPDGYHUWLVLQJXS<R<DQGHGXFDWLRQXS<R<(%,7'$
PDUJLQH[SDQGHGWRFRPSDUHGWRODVW\HDU1HWLQFRPH
LQFUHDVHGWR65PQLQFRPSDUHGWR65PQWKH\HDUEHIRUH7KLV
ZDVSULPDULO\RZLQJWRFDSLWDOJDLQVIURPWKHVDOHRIWKHJURXS¶VVKDUHLQ
,QWLJUDOLQYHVWPHQWZKLFKDPRXQWHGWR65PQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
x Financials
0DUNHWFDSPQ
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
SR
US$
Avg daily turnover (mn)
0
0
5HXWHUVFRGH
x Recent developments
,Q'HFHPEHU650*DQQRXQFHGWKDWLWZRXOGVHOOLWVIXOOVWDNHLQ
,QWLJUDOLQYHVWPHQWWR6DXGL7HOHFRP&RPSDQ\IRUDWRWDOYDOXHRI65PQ
6(
%ORRPEHUJFRGH
5(6($5&+$%
ZZZVUPJFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3%[
36[
'LY<LHOG
'36
3([
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0D\
6HS
-DQ
7$6,
0D\
650*5+6
6RXUFH5HXWHUV
TOP 5 SHAREHOLDERS (%)
.LQJGRP+ROGLQJ&RPSDQ\
++3ULQFH)DLVDO%LQ$KPDG%LQ
6DOPDQ$O6DXG
0RKDPPHG+XVVDLQ$OL$O$PXG\
*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
221
0(',$~0$<
7,+$0$$'9(57,6,1*
$/62.12:1$67,+$0$
Tihama Advertising & Public Relations Co., established in
1983, operates the Egyptian Satellite Channel, Al-Hayat
newspaper and Kolness magazine. The company operates
through its subsidiaries ± Tihama Distribution Company,
United Journalists, Star Media Co., Saudi Signs Supply Co.,
Intermarkets Riyadh, and Ad Art Medyan.
x Business brief
NOT COVERED
Current price (SR)
82.0
3ULFLQJDVRI
7LKDPDKDVWKUHHEXVLQHVVVHJPHQWV0HGLDFRPSULVHVQHZVSDSHUV
PDJD]LQHVRXWGRRUDGYHUWLVLQJDQGDVDWHOOLWHWHOHYLVLRQFKDQQHO3XEOLF
5HODWLRQVLQFOXGHVSUHVVILOHVDQGSURPRWLRQDOLQIRUPDWLRQVHUYLFHVDQG
2WKHU6HUYLFHVYLGHRSURGXFWLRQDQGGLVWULEXWLRQRI$UDELFDQG$PHULFDQ
ILOPVLQWKH0LGGOH(DVW7KHFRPSDQ\DOVRUXQVDQHWZRUNRIERRNVWRUHV
7LKDPDRSHUDWHVLQ&DLUR'XEDL/RQGRQDQG3DULV
x Financials
7LKDPD¶VUHYHQXHIHOO<R<LQ0WR65PQ1HWLQFRPHIRUWKH
VDPHSHULRGGHFOLQHG<R<WR65PQPDLQO\GXHWRLQFUHDVHLQUHQW
H[SHQVHVRIWKH&DXVH:D\FRPSDUHGWRODVW\HDUDQGGURSLQSURILWDELOLW\RI
DQDVVRFLDWHFRPSDQ\
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
$EVROXWH
1M
3M
12M
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
x Recent developments
2Q0DUFK7LKDPDDQQRXQFHGOLTXLGDWLQJLWVVXEVLGLDU\6DXGL
6LJQV6XSSO\&RGXHWRORVVHVZKLFKH[FHHGWKHVKDUHKROGHUV
ULJKWV
2Q)HEUXDU\WKHFRPSDQ\DQQRXQFHGWKHVDOHRIDVTXDUH
PHWHUSDUFHORIODQGLQ%DZDGL'LVWULFW-HGGDKIRUDWRWDOYDOXHRI65PQ
DQGDWDSURILWRI65PQ
2Q'HFHPEHU7LKDPDVLJQHGD\HDU65PQDJUHHPHQWZLWK
1HZ/RRN3XEOLFLW\$GYHUWLVLQJ$JHQF\WRUHQWDOOWKHDGYHUWLVLQJVLWHVRQ
6N\%DOOZHEVLWHV
6(
%ORRPEHUJFRGH
7$35&2$%
ZZZWLKDPDFRP
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
3([
10A
11A
TTM
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
FY09
FY10
FY11
9M12
YoY
(%)
CAGR (%)
(09-11)
0D\
6HS
7$6,
-DQ
0D\
7LKDPD5+6
TOP 5 SHAREHOLDERS (%)
%DGHU)DKDG,EUDKLP$O'DZRRG
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK<HDUHQGLQJ0DUFK
6RXUFH%ORRPEHUJ
222
0(',$~0$<
6$8',35,17,1*$1'
3$&.$*,1*&203$1<
$/62.12:1$6633&
Saudi Printing and Packaging Company (SPPC), formerly
Madina Printing and Publishing Company, was established in
1963. SPPC undertakes various commercial and package
printing as well as production activities. The company has five
printing houses, and a production area spread across 1.0mn
sq meters.
x Business brief
NOT COVERED
Current price (SR)
29.0
3ULFLQJDVRI
633&RIIHUVLQWHJUDWHGSULQWSURGXFWLRQVROXWLRQVULJKWIURPSUHSUHVV
GHVLJQLQJDQGSULQWLQJWRSRVWSULQWLQJELQGLQJDQGSDFNDJLQJ7KHFRPSDQ\
KDVDFDSDFLW\RIPDJD]LQHFRSLHVKRXUQHZVSDSHU
FRSLHVKRXUERRNSULQWLQJFDSDFLW\RIFRSLHVKRXUDQG
VKHHWVKRXU633&DOVRKDVH[FOXVLYHSULQWLQJULJKWVIRULWVSDUHQWFRPSDQ\
DQG6DXGL5HVHDUFKDQG3XEOLVKLQJ&RPSDQ\,WVSXEOLFDWLRQVLQFOXGH
6D\LGDW\$UUDMRO$O(TWLVDGLDK$OPDMDOODDQG$UDE1HZV
x Financials
633&¶VUHYHQXHGHFOLQHG<R<WR65PQLQ+RZHYHU(%,7'$
IRUWKHVDPHSHULRGJUHZ<R<WR65PQ1HWLQFRPHLQFUHDVHG
<R<WR65PQLQFRPSDUHGWR65PQLQ7KLVZDVPDLQO\
DVFULEHGWRWKHLQLWLDWLYHVWDNHQE\WKHPDQDJHPHQWWRUHGXFHH[SHQVHVDQG
LQFUHDVHSURILWDELOLW\
x Recent developments
STOCK DETAILS
ZHHNUDQJH+/65
0DUNHWFDSPQ
6KDUHVRXWVWDQGLQJPQ
Price perform (%)
1M
3M
12M
$EVROXWH
0DUNHW
6HFWRU
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
633&$%
ZZZVSSFFRPVD
,Q0DUFK633&DQQRXQFHGWKDWLWKDVVLJQHGD0HPRUDQGXPRI
8QGHUVWDQGLQJWRDFTXLUHDPDMRULW\LQWHUHVWLQ(PLUDWHV1DWLRQDO)DFWRU\IRU
3ODVWLF,QGXVWULHV//&7KHFRPSDQ\IXUWKHULQGLFDWHGWKDWLWLQWHQGVWR
ILQDQFHWKLVGHDOWKURXJKLQWHUQDODFFUXDOVDQGH[WHUQDO,VODPLFILQDQFLQJ
UHVRXUFHV
WEIGHTING & FREEFLOAT (%)
3([
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
SHARE PRICE PERFORMANCE
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
2008
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2009
2010
2011
YoY
(%)
CAGR (%)
(08-11)
0D\
6HS
7$6,
-DQ
0D\
633&5+6
TOP 5 SHAREHOLDERS (%)
6DXGL5HVHDUFKDQG0DUNHWLQJ*US ,QWHOOHFWXDO+ROGLQJ&RPSDQ\IRU
$GYHUWLVLQJDQG3XEOLFLW\
6DXGL5HVHDUFKDQG3XEOLVKLQJ&R
6FLHQWLILF:RUNV+ROGLQJ&RPSDQ\
6RXUFH7DGDZXO1&%&5HVHDUFK
223
6RXUFH%ORRPEHUJ
SAUDI FACTBOOK - 2012
NCB CAPITAL
MAY 2012
Hotel & Tourism
Ticker
Company
Page No.
4010
SHARCO
227
4170
Shams
228
0$<
+27(/67285,60
&DSDFLW\DGGLWLRQVWRGULYHJURZWK
$IWHUDVKDUSIDOOLQUHYHQXHVIURPWKHKRWHOVWRXULVP
VHFWRUJUHZVWURQJO\LQ$YHUDJHRFFXSDQF\URVHWR
GXULQJ-DQ$XJ$YHUDJHUHYHQXHSHUDYDLODEOHURRPDOVR
LQFUHDVHG<R<GULYHQE\GRPHVWLFDQGLQWHUQDWLRQDOWRXULVW
DUULYDOV,QWKHFRPLQJ\HDUV6DXGL$UDELDLVH[SHFWHGWRZLWQHVV
WKHDGGLWLRQRIFRQVLGHUDEOHKRWHOURRPFDSDFLW\HVSHFLDOO\LQ
UHOLJLRXVWRXULVPGHVWLQDWLRQVVXFKDV0DNNDKDQG0HGLQDZKLFK
ZLOOOLNHO\DLGWKHVHFWRU¶VJURZWK
7KHKRWHOVWRXULVPVHFWRU¶VDYHUDJH52(VWRRGDWVOLJKWO\EHORZWKH
*&&DYHUDJHRI+RZHYHUVWRFNVZHUHWUDGLQJDWDKLJKHU3%PXOWLSOHRI
[FRPSDUHGWRWKH*&&DYHUDJH[
Exhibit 137: Revenues of hotel and tourism companies in
GCC, 2009±11
Exhibit 138: Comparison of ROE & P/B of GCC companies,
2011
86'PQ
52(
%DKUDLQ
2PDQ
.6$
.XZDLW
8$(
3%[
.XZDLW
2PDQ
%DKUDLQ
8$(
.6$
6RXUFH=DZ\D
.6$
.XZDLW
%DKUDLQ
8$(
2PDQ
6RXUFH=DZ\D
7KHKRWHOVWRXULVPVHFWRUFRPSULVHV6DXGL+RWHOV5HVRUW$UHDV&R
6+$5&2DQG7RXULVP(QWHUSULVHV&R7(&2ERWKFRPSDQLHVDFFRXQWIRU
RIWKH7$6,
Exhibit 139: Sector details
8QLWVDVVWDWHG
Country
6DXGL+RWHOV5HVRUW$UHDV&R6+$5&2
7RXULVP(QWHUSULVHV&R7(&2
% weight in Index
as on 25 Mar 2012
NIM (%),
2011
Avg. RoE (%),
2011
6RXUFH=DZ\D
7KHVHFWRU¶VUHYHQXHVJUHZWR65PQLQIURP65PQLQ
7KHULVHZDVOHGE\6+$5&2ZKLFKSRVWHGDUHYHQXHJURZWKRI
<R<LQDIWHUDVKDUSIDOOLQ7KLVLQFUHDVHZDVGULYHQE\KLJKHU
UHYHQXHVIURPDOOSURSHUWLHVDVZHOODVJDLQVIURPWKHVDOHRILWVEXLOGLQJLQ2O\D
DQGFRPPHQFHPHQWRI$O0XWKDUDFRPSRXQGUHVLGHQFHLQ5L\DGK6+$5&2
UHSRUWHGDQHWSURILWRI65PQXS<R<7(&2µVUHYHQXHVURVH
<R<WR65PQLQ7KHFRPSDQ\¶VQHWSURILWGRXEOHGRYHUWKHSUHYLRXV
\HDUWR65EQGULYHQE\DQLPSURYHPHQWLQRSHUDWLRQDOHIILFLHQF\
225
+27(/67285,60
1&%&$3,7$/
0$<
Exhibit 140: Revenue of companies, 2009±2011
Exhibit 141: Profitability of companies, 2009±2011
65PQ
6+$5&2
7(&2
6+$5&2
6RXUFH=DZ\D
7(&2
6RXUFH=DZ\D
)RU6+$5&2¶V52(DQG3%PXOWLSOHVWRRGDWDQG[
UHVSHFWLYHO\FRPSDUHGWRDQG[LQ7(&2¶V52(VWRRGDW
LQ'HVSLWHDORZHU52(YLVjYLV6+$5&27(&2¶V3%PXOWLSOH
VWRRGDW[IRU
Exhibit 142: Comparison of P/B and ROE, 2010
Exhibit 143: Comparison of P/B and ROE, 2011
6+$5&2
6+$5&2
52(
52(
7(&2
7(&2
3%[
3%[
6RXUFH=DZ\D
6RXUFH=DZ\D
7(&2KDGKLJKHUDYHUDJHWUDGLQJYROXPHVDVZHOODVSULFHYRODWLOLW\FRPSDUHG
WR6+$5&2LQ
Exhibit 144: Avg. daily volumes, Jan11 ± Dec11
Exhibit 145: Share price movement, Jan11 ± Dec11
65PQ
3ULFHVUHEDVHGWRRQVW-DQ
6+$5&2
-DQ
7(&2
0D\
6+$5&2
6RXUFH=DZ\D
0DU
-XO
6HS
1RY
7(&2
6RXUFH=DZ\D
226
+27(/7285,60~0$<
6$8',+27(/6
$/62.12:1$66+$5&2
Riyadh-based Saudi Hotels & Resorts Areas Co. (SHARCO),
founded in 1979, owns and operates several resorts and
hotels independently and through its subsidiaries Al Khaleej
Resorts Co. Ltd., Riyadh Hotels Co. Ltd., Makkah Hotels Co.
Ltd., Al Nakheel Touristic Area Co. Ltd., Tabuk Hotels Co. Ltd.,
and Madina Hotels Co. Ltd.
NOT COVERED
Current price (SR)
3ULFLQJDVRI
Business brief
6+$5&2LVHQJDJHGLQWUDYHODQGWRXULVPDFWLYLWLHVDVZHOODVFRQVWUXFWLRQ STOCK DETAILS
RZQHUVKLSLQYHVWPHQWDQGPDQDJHPHQWRIKRWHOVUHDOHVWDWHUHVRUWVDQG
ZHHNUDQJH+/65
HQWHUWDLQPHQWFHQWHUV7KHFRPSDQ\PDLQO\RSHUDWHVWKURXJKLWV
0DUNHWFDSPQ
VXEVLGLDULHV$O.KDOHHM5HVRUWV&RPSDQ\DQG5L\DGK+RWHOVDQG
6KDUHVRXWVWDQGLQJPQ
(QWHUWDLQPHQW&RPSDQ\7KHFRPSDQ\UHSRUWVUHYHQXHVXQGHUIRXUEXVLQHVV
Price perform (%) 1M
OLQHVKRVSLWDOLW\UHDOHVWDWHUHVRUWVDQGHQWHUWDLQPHQW
x Financials
6+$5&2¶VUHYHQXHVLQFUHDVHGWR65PQLQFRPSDUHGWR
65PQLQ1HWLQFRPHJUHZWR65PQGXULQJWKH\HDU
IURP65PQLQ7KHFRPSDQ\¶VSHUIRUPDQFHLPSURYHGSULPDULO\
GXHWRWKHJDLQZKLFKLWUHFHLYHGIURPVHOOLQJDEXLOGLQJLQ2O\D7KLVZDVLQ
DGGLWLRQWRWKHFRPPHQFHPHQWRIRSHUDWLRQVLQ$O0DWKHUFRPSRXQG
UHVLGHQFHLQ5L\DGK
x Recent developments
3M
12M
$EVROXWH
0DUNHW
6HFWRU
SR
US$
Avg daily turnover (mn)
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
6+$5&2$%
ZZZVDXGLKRWHOVFRPVD
6+$5&2LQFUHDVHGLWVFDSLWDOE\WR65EQIURP65PQE\
LVVXLQJPQQHZVKDUHV$GGLWLRQDOO\WKHFRPSDQ\DQQRXQFHGWKDW0U
%DGU%LQ+DPPRXG$O%DGUZRXOGUHSODFH0U$EGXOD]L]%LQ6DOHK$O$QEDU
DV&KLHI([HFXWLYH2IILFHU&(2WKLVEHFDPHHIIHFWLYHRQ-DQXDU\
27.4
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
10A
11A
3([
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
2008
2009
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
2010
2011
YoY
(%)
CAGR (%)
(08-11)
SHARE PRICE PERFORMANCE
0D\ $XJ 1RY )HE 0D\
7$6,
+RWHOV5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
0RKDPPHG,EUDKLP0RKDPPHG
$O(VVD
3XEOLF,QYHVWPHQW)XQG
*HQHUDO2UJDQL]DWLRQIRU6RFLDO
,QVXUDQFH*26,
6RXUFH7DGDZXO1&%&5HVHDUFK
227
+27(/7285,60~0$<
7285,60(17(535,6(&2
$/62.12:1$66+$06
Tourism Enterprise Co. (TECO) was established in 1991 to
construct and manage tourist projects. Headquartered in
Dammam, Saudi Arabia, the company primarily focuses on the
ownership and management of the Palm Beach Resort. TECO
offers sports and recreational activities, conference facilities,
cabanas and suites.
NOT COVERED
Current price (SR)
33.0
3ULFLQJDVRI
x Business brief
3DOP%HDFK5HVRUWZKLFKVWUHWFKHVXSWRPHWHUVLQFOXGHV
STOCK DETAILS
FKDOHWVDQGPRUHWKDQVXLWHVDQGFDEDQDVRYHUORRNLQJWKH$UDELDQ*XOI ZHHNUDQJH+/65
6SRUWV7KHUHFUHDWLRQDOIDFLOLWLHVLQFOXGHDVSRUWVFOXEZLWKDVZLPPLQJSRRO
0DUNHWFDSPQ
IRUODGLHVVSRUWVDQGILWQHVVFHQWHUIRUPHQIRRWEDOOWHQQLVEDVNHWEDOODQG
6KDUHVRXWVWDQGLQJPQ
VTXDVKFRXUWVVDXQDDQGVWHDPEDWKIDFLOLW\DQGFDWHULQJVHUYLFHVVXFKDV
Price perform (%) 1M
FRIIHHVKRSV7KH5HVRUWRIIHUVHYHQWIDFLOLWLHVVXFKDVFRQIHUHQFHURRPVIRU
$EVROXWH
XSWRJXHVWVLQDGGLWLRQWREXVLQHVVOXQFKHVDQGFRFNWDLOV
0DUNHW
6HFWRU
x Financials
7(&2¶VUHYHQXHVJUHZ<R<WR65PQLQ7KLVFRXOGEH
DWWULEXWHGWRWKHEHWWHUWKDQH[SHFWHGRFFXSDQF\UDWHVDVZHOODVKLJKHU
UHQWDOLQFRPHGXULQJWKH\HDU7KHFRPSDQ\SRVWHGDQHWSURILWRI65PQ
LQFRPSDUHGWR65PQLQ7(&2¶VQHWPDUJLQVWRRGDW
YHUVXVLQ
x Recent developments
3M
12M
Avg daily turnover (mn)
SR
US$
0
0
5HXWHUVFRGH
6(
%ORRPEHUJFRGH
7(&2$%
ZZZSDOPEHDFKUHVRUWFRP
,Q'HFHPEHU7(&2DQQRXQFHGWKHDFTXLVLWLRQRIDQHZEXLOGLQJLQ$O
.KREDUDUHDIRUDFRQVLGHUDWLRQRI65PQ
WEIGHTING & FREEFLOAT (%)
7$6,IUHHIORDWZHLJKW
)UHHIORDW
VALUATION MULTIPLES
09A
3([
10A
11A
10
3%[
36[
'LY<LHOG
'36
6RXUFH1&%&5HVHDUFKHVWLPDWHV
Company financials
5HYHQXHV
(%,7'$
1HW,QFRPH
$VVHWV
(TXLW\
7RWDO'HEW
&DVK(TXLY
(%,7'$0JQ
1HW0JQ
52(
52$
'LY3D\RXW
(36
%936
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65PQ
65
65
SHARE PRICE PERFORMANCE
2008
2009
2010
2011
6RXUFH7DGDZXO=DZ\D&RPSDQ\1&%&5HVHDUFK
YoY
(%)
CAGR (%)
(08-11)
0D\
6HS
-DQ
7$6,
0D\
6KDPV5+6
6RXUFH%ORRPEHUJ
TOP 5 SHAREHOLDERS (%)
6RXUFH7DGDZXO1&%&5HVHDUFK
6RXUFH 7DGDZXO 1&%& 5HVHDUFK
228
6$8',)$&7%22.
1&%&$3,7$/
0$<
$SSHQGL[
6DXGLHTXLWLHVIDFWVKHHW±SHUIRUPDQFHDQGYDOXDWLRQ
Exhibit 146: Performance and valuation
Exchg
code
Company name
Close
(SR)
Banking/Financial
$O5DMKL
6$0%$
6DXGL)UDQVL
5,%/
$O,QPD%DQN
$UDE1DWLRQDO
6$%%
$O%LODG
%-$=
6DXGL,QYHVWPHQW
6DXGL+ROODQGL
Petrochemicals
6$%,&
,QGXVWULDOL]DWLRQ
6$)&2
6DXGL.D\DQ
<$16$%
6,,*
6LSFKHP
6DKDUD3HWURFKHPLFDO $33&
3HWUR5DELJK
1DPD&KHPLFDOV
3HWURFKHP
&KHPDQRO
$OXMDLQ
Cement
6DXGL&HPHQW
<DPDPDK&HPHQW
<DQEX&HPHQW
6RXWKHUQ&HPHQW
$UDE&HPHQW
4DVVLP&HPHQW
(DVWHUQ&HPHQW
$O-RXI&HPHQW
7DEXN&HPHQW
1DMUDQ&HPHQW
+DLO&HPHQW
Retail
-DULU
$O+RNDLU
0RXZDVDW
$O2WKDLP
$OGUHHV
6$6&2
)LWDLKL*URXS
8QLWHG(OHFWURQLFV
$ONKDOHHM7UQJ
7KLP
DU
Energy & Utilities
6DXGL(OHFWULFLW\
*$6&2
Agriculture/food
6DYROD*URXS
$OPDUDL
4DVVLP$JULFXOWXUH
T/O
(SR mn)
Mkt cap
(SR mn)
FF
Wt (%)
Price change
% last
%YTD
ROE
TTM (%)
ROA
Valuation (x) Div yld
P/E-TTM PBV# 11 (%)
QP
QP
QP
QP
QP
QP QP
6RXUFH7DGDZXO1&%&5HVHDUFK
1RWH<7'±LQGLFDWHVFKDQJHLQSULFHIURPFORVHDWHQGRIRUWKHLVVXHSULFHGXULQJWKH,32LIOLVWHGLQWKLV\HDUEDVHGRQODWHVWDYDLODEOHERRNYDOXH
229
6$8',)$&7%22.
1&%&$3,7$/
0$<
Exhibit 146: Performance and valuation
Exchg
code
Company name
1$'(&
6$'$)&2
-D]DQ'HYHORSPHQW
-RXII$JULFXOWXUH
+HUI\)RRGV
$QDDP+ROGLQJ
6DXGL)LVKHULHV
+DOZDQL%URV
)RRG3URGXFWV&R
7DEXN$JULFXOWXUH
6KDUTL\D'HY&R
Telecom/IT
(WLKDG(WLVDODW
67&
=DLQ.6$
6,7&
$WKHHE7HOHFRP
Insurance
7DZXQL\D
0('*8/)
0DODWK,QVXUDQFH
$//,$1=6)
6DXGL5H
(QD\D&RRS,QV
6ROLGDULW\
6$%%7DNDIXO
$7&
AMANA,QVXUDQFH
ACE$UDELD
%83$$UDELD
:HTD\D7DNDIXO
$5&&,
$,&&
6$1$'
:DODD,QVXUDQFH
$O$KOLD
Gulf*HQHUDO
6$,&2
Trade8QLRQ
8&$
*XOI8QLRQ
6DJU,QVXUDQFH
$;$&RRSHUDWLYH
%XUXM,QVXUDQFH
$UDELDQ6KLHOG
$O$ODPL\D
:DWDQL\D,QVXUDQFH
$&,*
6DXGL6DODPD
6DXGL,QGLDQ
Multi Investment
.LQJGRP+ROGLQJ
$VVLU
6,6&2
6$5&2
Al$KVDIRU'HY
6DXGL$GYDQFHG
$O%DKD
Industrial Inv
0$
$'(1
6DXGL&KHPLFDO
63,0$&2
Close
(SR)
T/O
(SR mn)
Mkt cap
(SR mn)
FF
Wt (%)
Price change
% last
%YTD
TTM (%)
ROE
ROA
Valuation (x)
Div yld
P/E-TTM PBV# 10 (%)
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
QP
6RXUFH7DGDZXO1&%&5HVHDUFK
1RWH<7'±LQGLFDWHVFKDQJHLQSULFHIURPFORVHDWHQGRIRUWKHLVVXHSULFHGXULQJWKH,32LIOLVWHGLQWKLV\HDUEDVHGRQODWHVWDYDLODEOHERRNYDOXH
230
6$8',)$&7%22.
1&%&$3,7$/
0$<
Exhibit 146: Performance and valuation
Exchg
code
Company name
6KDNHU*URXS
$VWUD,QG
$O6RUD\DL*URXS
=28-$-
$O$EGXOODWLI
%&,
630
4140 6DXGL([SRUW
1201 7DNZHHQ$GY,QGV
2220 0DDGDQL\DK
2180 ),3&2
Construction
6DXGL&HUDPLFV
$PLDQWLW
=DPLO,QG
6DXGL&DEOHV
$O%DEWDLQ
$UDELDQ3LSHV
00*
6,'&
$O.KRGDUL
69&3
0(6&
663
National*\SVXP
$VODN
5HG6HD+RXVLQJ
Real Estate
-DEDO2PDU
'DU$O$UNDQ
0DNNDK
(PDDU(&
7DLED
$UUL\DGK'HY
.(&0DGLQDK
$O$NDULD
Transport
16&6$
6$37&2
0XEDUUDG
%XGJHW6DXGL
Media& Publishing
650*
7LKDPD
633&
Hotel & Tourism
6+$5&2
6KDPV
Close
(SR)
T/O
(SR mn)
Mkt cap
(SR mn)
FF
Wt (%)
Price change
% last
%YTD
TTM (%)
ROE
ROA
Valuation (x)
Div yld
P/E-TTM PBV# 10 (%)
QP
QP
QP
QP
QP
QP
6RXUFH7DGDZXO1&%&5HVHDUFK
1RWH<7'±LQGLFDWHVFKDQJHLQSULFHIURPFORVHDWHQGRIRUWKHLVVXHSULFHGXULQJWKH,32LIOLVWHGLQWKLV\HDUEDVHGRQODWHVWDYDLODEOHERRNYDOXH
231
6$8',)$&7%22.
1&%&$3,7$/
0$<
Kindly send all mailing list requests to research@ncbc.com
NCBC Research website
KWWSUHVHDUFKQFEFFRP
Brokerage website
ZZZDODKOLWDGDZXOFRP
ZZZDODKOLEURNHUDJHFRP
Corporate website
ZZZQFEFFRP
NCBC Investment Ratings
29(5:(,*+7
1(875$/
81'(5:(,*+7
35,&(7$5*(7
7DUJHWSULFHUHSUHVHQWVH[SHFWHGUHWXUQVLQH[FHVVRILQWKHQH[WPRQWKV
7DUJHWSULFHUHSUHVHQWVH[SHFWHGUHWXUQVEHWZHHQDQGLQWKHQH[WPRQWKV
7DUJHWSULFHUHSUHVHQWVDIDOOLQVKDUHSULFHH[FHHGLQJLQWKHQH[WPRQWKV
$QDO\VWVVHWVKDUHSULFHWDUJHWVIRULQGLYLGXDOFRPSDQLHVEDVHGRQDPRQWKKRUL]RQ7KHVHVKDUHSULFHWDUJHWVDUHVXEMHFWWRD
UDQJHRIFRPSDQ\VSHFLILFDQGPDUNHWULVNV7DUJHWSULFHVDUHEDVHGRQDPHWKRGRORJ\FKRVHQE\WKHDQDO\VWDVWKHEHVWSUHGLFWRU
RIWKHVKDUHSULFHRYHUWKHPRQWKKRUL]RQ
Other Definitions
15 1RW5DWHG7KHLQYHVWPHQWUDWLQJKDVEHHQVXVSHQGHGWHPSRUDULO\6XFKVXVSHQVLRQLVLQFRPSOLDQFHZLWKDSSOLFDEOHUHJXODWLRQVDQGRULQ
FLUFXPVWDQFHVZKHQ1&%&DSLWDOLVDFWLQJLQDQDGYLVRU\FDSDFLW\LQDPHUJHU
RUVWUDWHJLFWUDQVDFWLRQLQYROYLQJWKHFRPSDQ\DQGLQFHUWDLQRWKHUVLWXDWLRQV
&6 &RYHUDJH6XVSHQGHG1&%&KDVVXVSHQGHGFRYHUDJHRIWKLVFRPSDQ\
1& 1RWFRYHUHG1&%&GRHVQRWFRYHUWKLVFRPSDQ\
Important information
7KHDXWKRUVRIWKLVGRFXPHQWKHUHE\FHUWLI\WKDWWKHYLHZVH[SUHVVHGLQWKLVGRFXPHQWDFFXUDWHO\UHIOHFWWKHLUSHUVRQDOYLHZVUHJDUGLQJWKHVHFXULWLHVDQG
FRPSDQLHVWKDWDUHWKHVXEMHFWRIWKLVGRFXPHQW7KHDXWKRUVDOVRFHUWLI\WKDWQHLWKHUWKH\QRUWKHLUUHVSHFWLYHVSRXVHVRUGHSHQGDQWVLIUHOHYDQWKROGD
EHQHILFLDOLQWHUHVWLQWKHVHFXULWLHVWKDWDUHWKHVXEMHFWRIWKLVGRFXPHQW)XQGVPDQDJHGE\1&%&DSLWDODQGLWVVXEVLGLDULHVIRUWKLUGSDUWLHVPD\RZQWKH
VHFXULWLHVWKDWDUHWKHVXEMHFWRIWKLVGRFXPHQW1&%&DSLWDORULWVVXEVLGLDULHVPD\RZQVHFXULWLHVLQRQHRUPRUHRIWKHDIRUHPHQWLRQHGFRPSDQLHVRU
IXQGVRULQIXQGVPDQDJHGE\WKLUGSDUWLHV7KHDXWKRUVRIWKLVGRFXPHQWPD\RZQVHFXULWLHVLQIXQGVRSHQWRWKHSXEOLFWKDWLQYHVWLQWKHVHFXULWLHV
PHQWLRQHGLQWKLVGRFXPHQWDVSDUWRIDGLYHUVLILHGSRUWIROLRRYHUZKLFKWKH\KDYHQRGLVFUHWLRQ7KH,QYHVWPHQW%DQNLQJGLYLVLRQRI1&%&DSLWDOPD\EH
LQWKHSURFHVVRIVROLFLWLQJRUH[HFXWLQJIHHHDUQLQJPDQGDWHVIRUFRPSDQLHVWKDWDUHHLWKHUWKHVXEMHFWRIWKLVGRFXPHQWRUDUHPHQWLRQHGLQWKLV
GRFXPHQW
7KLVGRFXPHQWLVLVVXHGWRWKHSHUVRQWRZKRP1&%&DSLWDOKDVLVVXHGLW7KLVGRFXPHQWLVLQWHQGHGIRUJHQHUDOLQIRUPDWLRQSXUSRVHVRQO\DQGPD\QRW
EHUHSURGXFHGRUUHGLVWULEXWHGWRDQ\RWKHUSHUVRQ7KLVGRFXPHQWLVQRWLQWHQGHGDVDQRIIHURUVROLFLWDWLRQZLWKUHVSHFWWRWKHSXUFKDVHRUVDOHRIDQ\
VHFXULW\7KLVGRFXPHQWLVQRWLQWHQGHGWRWDNHLQWRDFFRXQWDQ\LQYHVWPHQWVXLWDELOLW\QHHGVRIWKHUHFLSLHQW,QSDUWLFXODUWKLVGRFXPHQWLVQRW
FXVWRPL]HGWRWKHVSHFLILFLQYHVWPHQWREMHFWLYHVILQDQFLDOVLWXDWLRQULVNDSSHWLWHRURWKHUQHHGVRIDQ\SHUVRQZKRPD\UHFHLYHWKLVGRFXPHQW1&%
&DSLWDOVWURQJO\DGYLVHVHYHU\SRWHQWLDOLQYHVWRUWRVHHNSURIHVVLRQDOOHJDODFFRXQWLQJDQGILQDQFLDOJXLGDQFHZKHQGHWHUPLQLQJZKHWKHUDQLQYHVWPHQWLQ
DVHFXULW\LVDSSURSULDWHWRKLVRUKHUQHHGV$Q\LQYHVWPHQWUHFRPPHQGDWLRQVFRQWDLQHGLQWKLVGRFXPHQWWDNHLQWRDFFRXQWERWKULVNDQGH[SHFWHG
UHWXUQ,QIRUPDWLRQDQGRSLQLRQVFRQWDLQHGLQWKLVGRFXPHQWKDYHEHHQFRPSLOHGRUDUULYHGDWE\1&%&DSLWDOIURPVRXUFHVEHOLHYHGWREHUHOLDEOHEXW
1&%&DSLWDOKDVQRWLQGHSHQGHQWO\YHULILHGWKHFRQWHQWVRIWKLVGRFXPHQWDQGVXFKLQIRUPDWLRQPD\EHFRQGHQVHGRULQFRPSOHWH$FFRUGLQJO\QR
UHSUHVHQWDWLRQRUZDUUDQW\H[SUHVVRULPSOLHGLVPDGHDVWRDQGQRUHOLDQFHVKRXOGEHSODFHGRQWKHIDLUQHVVDFFXUDF\FRPSOHWHQHVVRUFRUUHFWQHVVRI
WKHLQIRUPDWLRQDQGRSLQLRQVFRQWDLQHGLQWKLVGRFXPHQW7RWKHPD[LPXPH[WHQWSHUPLWWHGE\DSSOLFDEOHODZDQGUHJXODWLRQ1&%&DSLWDOVKDOOQRWEH
OLDEOHIRUDQ\ORVVWKDWPD\DULVHIURPWKHXVHRIWKLVGRFXPHQWRULWVFRQWHQWVRURWKHUZLVHDULVLQJLQFRQQHFWLRQWKHUHZLWK$Q\ILQDQFLDOSURMHFWLRQVIDLU
YDOXHHVWLPDWHVDQGVWDWHPHQWVUHJDUGLQJIXWXUHSURVSHFWVFRQWDLQHGLQWKLVGRFXPHQWPD\QRWEHUHDOL]HG$OORSLQLRQVDQGHVWLPDWHVLQFOXGHGLQWKLV
GRFXPHQWFRQVWLWXWH1&%&DSLWDO¶VMXGJPHQWDVRIWKHGDWHRISURGXFWLRQRIWKLVGRFXPHQWDQGDUHVXEMHFWWRFKDQJHZLWKRXWQRWLFH3DVWSHUIRUPDQFHRI
DQ\LQYHVWPHQWLVQRWLQGLFDWLYHRIIXWXUHUHVXOWV7KHYDOXHRIVHFXULWLHVWKHLQFRPHIURPWKHPWKHSULFHVDQGFXUUHQFLHVRIVHFXULWLHVFDQJRGRZQDV
ZHOODVXS$QLQYHVWRUPD\JHWEDFNOHVVWKDQKHRUVKHRULJLQDOO\LQYHVWHG$GGLWLRQDOO\IHHVPD\DSSO\RQLQYHVWPHQWVLQVHFXULWLHV&KDQJHVLQ
FXUUHQF\UDWHVPD\KDYHDQDGYHUVHHIIHFWRQWKHYDOXHSULFHRULQFRPHRIDVHFXULW\1RSDUWRIWKLVGRFXPHQWPD\EHUHSURGXFHGZLWKRXWWKHZULWWHQ
SHUPLVVLRQRI1&%&DSLWDO1HLWKHUWKLVGRFXPHQWQRUDQ\FRS\KHUHRIPD\EHGLVWULEXWHGLQDQ\MXULVGLFWLRQRXWVLGHWKH.LQJGRPRI6DXGL$UDELDZKHUH
LWVGLVWULEXWLRQPD\EHUHVWULFWHGE\ODZ3HUVRQVZKRUHFHLYHWKLVGRFXPHQWVKRXOGPDNHWKHPVHOYHVDZDUHRIDQGDGKHUHWRDQ\VXFKUHVWULFWLRQV%\
DFFHSWLQJWKLVGRFXPHQWWKHUHFLSLHQWDJUHHVWREHERXQGE\WKHIRUHJRLQJOLPLWDWLRQV
1&%&DSLWDOLVDXWKRULVHGE\WKH&DSLWDO0DUNHW$XWKRULW\RIWKH.LQJGRPRI6DXGL$UDELDWRFDUU\RXWGHDOLQJDVSULQFLSDODQGDJHQWDQGXQGHUZULWLQJ
PDQDJLQJDUUDQJLQJDGYLVLQJDQGFXVWRG\ZLWKUHVSHFWWRVHFXULWLHVXQGHUOLFHQFHQXPEHU7KHUHJLVWHUHGRIILFHRIZKLFKLVDW$O0DWKHU
VWUHHWLQ5L\DGK32%R[5L\DGK.LQJGRPRI6DXGL$UDELD