FY2001 INTERIM RESULTS
August 15, 2001
1
AGENDA
Company Update
Financial Performance
Q&A
2
COMPANY UPDATE
By Henry Lim
President & CEO
3
MISSION
To be the one of the top knowledge-
based, value-added distributors of
electronics and IT solutions in the Asia
Pacific region;
To be a leading Asian-based creator of
innovative proprietary technology
products and solutions
4
CORE COMPETENCIES
Peripherals
and Software
Data Networking/
Service Offerings/
Design &
Development
Electronic
Components
Strategic
Technologies
5
REGIONAL PRESENCE
Korea
China
India
HK
Thailand
Taiwan
Vietnam Philippines
Malaysia
S’pore
Indonesia
Australia
6
ACHIEVEMENTS
(Jan - July 2001)
 Corporate
– Strengthening Group Dynamics
• Acquisition of subsidiaries in Vietnam & Australia
 Business
– New Strategic Partnerships
– Four new distributorships secured:
•
•
•
•
Infineon
Western Digital
Transpoint Technology
Stream Machine Inc
– Expected to contribute >$80 million to Group
revenue in FY2001
7
ACHIEVEMENTS
(Jan - July 2001)
Geographic Expansion : China
–
–
–
–
–
–
Achieva Technology China
51% owned by Achieva
49% owned by HK-based Interlead Corporation
Paid up capital : HK$10 million
Distribution and service centre for IT products
Distribution network covering 13 cities and 28
retail outlets in PRC
– Expected to contribute S$40 million to Group
revenue in 2H
8
PRESENCE IN PRC
SHENYANG
•
••
ZHENGZHOU
•
XI’AN •
NANJING
•
WUHAN• • SHANGHAI
• HANGZHOU
CHENGDU •
CHONGQING •
•GUANGZHOU (HQ)
SHENZHEN •
BEIJING
JINAN
9
ACHIEVEMENTS
(Jan - July 2001)
Technology
– IP and Patents
• HDD connectivity
• Notebook batteries
• Expect to file 7 patents on NanoStorage this
year
10
ACHIEVEMENTS
(Jan - July 2001)
 Technology
– NanoStorage
• Working prototype of controller device on schedule
• Received engineering sample
• Expect to demonstrate complete working engineering
sample by year-end
• Nanochip currently raising funds to bring the prototype
into production
• Received in-principle approval for government grant for
R&D support
11
ACHIEVEMENTS
(Jan - July 2001)
Talent
– ESOS
– Founder Shares Award Scheme
12
MARKET OUTLOOK THE BAD NEWS
 Visibility for electronics industry still foggy
– Singapore’s electronics output declined 26% in Q2 2001
 Semiconductor industry continues to be
affected by inventory overhang
 Major global electronics players are
reporting losses and cutbacks
 Contract manufacturing not expected to
recover soon
13
MARKET OUTLOOK THE GOOD NEWS
 PC industry in Asia-Pacific showing signs of
initial recovery
– Gartner: Asia-Pacific registered a 12.5% y-o-y
growth in PC shipments in 2001Q2
• Gartner Dataquest, August 2001
 Contract manufacturing services expected
to recover and hit US$231 billion by 2005 up 124% from US$103 billion in 2000
• IDC July 2001
14
MARKET OUTLOOK THE GOOD NEWS
 Consolidation of electronics players => new
opportunities for stronger players
 New emerging markets with strong growth
potential :
– China
• 1H 2001 growth : 8% - full year growth expected to be
maintained
• WTO entry
• Beijing Olympics
– India
• IT hub of South Asia
15
GOING FORWARD
 To ride out the storm with prudent management and





strategic focus on niche competencies and markets
To expand strategically in high-growth emerging
economies such as China
To continue to scale up the value chain to provide a full
range of knowledge-based value-added services and
solutions
To leverage on existing knowledge base, wide network of
customers and vast portfolio of products to develop and
deliver new offerings to the market
To grow IP and proprietary products/solutions portfolio in
high-growth leading-edge technology sectors
To build up professional talent to strengthen management
and technological expertise
16
FINANCIAL
PERFORMANCE
By Allan Yong
Chief Financial Officer
17
GROUP TURNOVER
S$million
250
242
200
150
160
100
50
0
FY2000-1H
FY2001-1H
18
TURNOVER BY PRODUCT
S$’000
 FY2000 –1H
15.70%
FY2001-1H
13.00%
1.30%
83%
1.00%
86%
PC peripherals & software
Electronic components
Data network
19
TURNOVER BY MARKET
S$million
70
60
50
40
30
20
10
0
58
56.5 55
48 49.2 45.6
46.6
17.6
10.3
0.1 0
0
FY2000-1H
S'pore
PRC
8.6 6.7
FY2001-1H
Malaysia
Indonesia
Australia
Philippines
Vietnam
20
GROUP PBT
S$million
6.5
0.9
6
5.5
6.2
5
5.6
4.5
4
3.5
3
FY2000-1H
FY2001-1H
21
PBT BY PRODUCT
S$’000
4500
4000
3500
3000
2500
2000
1500
1000
500
0
-500
-1000
PC peripherals
and software
electronic
components
Data network
pdts
Strategic
investments
Others
FY00-1H
FY01-1H
22
NET PROFIT
S$’000
6,000
5,000
4,382
4,000
3,000
3,892
3,819
FY2000-1H
FY2001-1H
2,000
1,000
23
FINANCIAL HIGHLIGHTS
 Strong turnover growth
 Stable net profit despite margin squeeze
 Growth in profit contribution from electronics
components
 Strategic investments in NanoStorage of $0.8M
 Strong balance sheet - cash position – up from
$22M to $27M
 Inventory down to $31M
 Trade receivables –up from $38M to $56M
24
EPS
cents
1.2
1.06
1
0.8
0.6
1.19
0.4
0.92
0.2
0
FY00-1H
FY01-1H
25
NTA PER SHARE
cents
12.5
Up 17.6%
12.44
12
11.5
11
10.58
10.5
10
9.5
FY00-1H
FY01-1H
26
FINANCIAL OUTLOOK
 Challenging conditions for 1H and outlook
for 2H uncertain
 Revenues expected to continue growing:
Estimated total impact >S$120m for
FY2001
 Profit margins continue to be pressured
with increasing competition and electronics
slowdown
27
Q&A
28