Asia Pacific Equity Research

01 August 2013

Company Visit Note

Cordlife Group Limited
We visited Cordlife Group Limited at their new facility, APosh Bizhub in Yishun, where the management shared with us the companys current operations and growth plans. Key highlights from the meeting: Market leader position in Singapore: Cordlife is the market leader for private cord blood banking in Singapore with a 62% market share in 2011. Management estimates that this figure may have since increased to more than 70%. Competitive advantages include the AABB accreditation and a track record of 10 successful cord blood transplants. Expansion of services and geography: Cordlife pursues a dual strategy of growth, through expansion of services and ventures into new geographies. It recently added umbilical cord tissue banking within Singapore, and has indicated plans to further add to their product mix. At end of June 2013, the company acquired businesses and assets in Philippines, Indonesia and India. Reaping economies of scale with Asias largest private cord blood storage facility: Cordlife launched its new 23,000 square feet facility in April 2013. Management believes that the move will enable the company to further meet the needs of its growing customer base in Singapore and allow it to benefit from economies of scale, leading to greater operational efficiency and margin expansion for their Singapore operations. Stable recurring cash flow + dividend yield support: Cordlifes payment plans include a combination of lump sum payments and recurring annual installments. With 25,000 customers on the installment plan, and a growing subscriber base, Cordlife expects a stable and recurring cash flow. Management has also indicated a commitment to dividends. Valuation: The stock now trades at a FY13E consensus P/E of 23.4x, and has outperformed the STI Index by 97% since its IPO on 29 March 2012.
NOTE: THIS DOCUMENT IS INTENDED AS INFORMATION ONLY AND NOT AS A RECOMMENDATION FOR ANY STOCK. IT CONTAINS FACTUAL INFORMATION OBTAINED BY THE ANALYST DURING MEETINGS WITH THE MANAGEMENT. J.P. MORGAN DOES NOT COVER THIS COMPANY AND HAS NO RATING ON THE STOCK. Cordlife Group (Bloomberg CLGL SP; Reuters: CORD.SI)
SGD in millions, year-end Jun Revenue Net profit (reported) Net profit (recurring) EPS Recurring EPS (SGD) Recurring EPS growth DPS (SGD) Sales growth ROE P/E (recurring) (x) P/B (x) Dividend yield
Source: Company data.

Healthcare Services Ying-Jian Chan, CFA

AC

(65) 6882-2378 ying.jian.yj.chan@jpmorgan.com Bloomberg JPMA YCHAN <GO> J.P. Morgan Securities Singapore Private Limited

CLGL SP, Not Covered S$1.06, Aug 1, 2013

Share price
S$

1.4 1.2 1 0.8 0.6 0.4 0.2 0 Mar-12 Aug-12 Jan-13 Jun-13

Source: Bloomberg.

Abs Rel

YTD 88% 86%

1m 4% 1%

3m 48% 55%

12m 122% 109%

Source: Bloomberg.

FY10 28.2 8.3 8.3 0.04 0.04 34% 0.0 0 24.7% 25% 29.7 7.4 0.0%

FY11 25.7 8.5 8.5 0.04 0.04 2% 0.00 -8.8% 21% 28.9 6.0 0.0%

FY12 28.8 6.9 8.8 0.03 0.04 4% 0.04 12.1% 9.7% 27.8 3.4 3.6%

Shares O/S (mn) Market cap (S$ mn) Market cap ($ mn) Price (S$) Date of price Free float (%) 3mth Avg daily volume S$ mn) Average 3m Daily Turnover ($ mn) FTSTI Exchange rate Year-end

232 245 193 1.06 1-Aug-13 65.9% NA NA 3,243 1.27 Jun

See page 14 for analyst certification and important disclosures, including non-US analyst disclosures.
J.P. Morgan does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. www.jpmorganmarkets.com

Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

Key highlights from the meeting

We visited Cordlife Group Limited at their new facility at APosh Bizhub in Yishun, where the management shared with us the companys current operations and growth plans.

Market leader position in Singapore

Cordlife is the market leader for private cord blood banking in Singapore with a 62% market share in 2011. Management estimates that this figure has since increased to more than 70%. Management see certain competitive advantages which helps Cordlife defend this position: 1. AABB accreditation: According to management, the process of accreditation may take up to 2 years. The accreditation is important as it allows patients to easily use the blood for transplant in many countries. This accreditation process therefore creates a certain degree of barrier to entry for new entrants. 2. Cordlifes strong track record: According to management, Cordlife has recorded 10 successful cord blood transplants. This track record provides reassurance to customers who are deciding on a blood bank. Based on available public disclosure, there has not been any successful transplant in the other Singapore private cord blood banks yet. 3. Secured facility at APosh Bizhub: Cordlifes new facility is equipped with backup systems such as an electricity generator, mobile storage, and liquid nitrogen tanks. The facility itself is also designed to insulate against fire breakouts. This increases assurance for subscribers. 4. Cordlife Care 360 Safeguard: This plan was designed to increase subscribers peace of mind. Its coverage includes pregnancy and childbirth complications, as well as a guarantee match for a cord blood unit (or US$25,000 to defray medical costs if the cord blood unit loses viability at point of transplant).

Expansion of services and geography

Cordlife pursues a dual strategy of growth through expansion of services and ventures into new geographies. Expansion of services It recently added umbilical cord tissue banking within Singapore through a partnership with Thomson Medical Pte Ltd in May 2013. However, this service is still under clinical trial, and is currently not yet licensed by the Ministry of Health (MOH). Cordlife has also indicated plans to further add to their product mix; these planned incremental services will leverage on Cordlifes existing expertise and distribution channels, which allows them to roll out more easily and economically. Expansion of geography At end of June 2013, the company announced acquisitions of cord blood and cord tissue banking businesses in Philippines, Indonesia and India from Australian listed Life Corporation Limited (formerly Cordlife Limited), which the Cordlife Group had demerged from. Cordlife had a right of first refusal on these assets and previously indicated intentions to acquire these assets once they started to turn profitable. Total consideration for the acquisitions was A$5.5million.
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Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

According to management, gross margin for these countries are at 55-65% (vs. Singapore: c.70%). On a net profit basis, management has indicated that operations in Philippines, Indonesia and India have just started to break even. In July 2013, Cordlifes India subsidiary was also awarded the AABB accreditation

Reaping economies of scale with Asias largest private cord blood storage facility
In April 2013, Cordlife launched its new 23,000 square feet facility, which spans 18 strata units on levels 5 and 6 of APosh Bizhub in Yishun. Management believes that this move will enable the company to further meet the needs of its growing customer base in Singapore and allow it to benefit from economies of scale. This facility is also the first one in Asia to adopt an improved automated stem cell processing technology known as Sepax 2, which allows for greater extraction effectiveness in harvesting red blood cells from cord blood. The motivation behind the outright purchase of this facility is to lock in property costs and ensure that the business remains scalable as the companys customer base expands in Singapore. Currently, while the facility is able to house up to 650,000 cord blood units, only approximately 40,000 cord blood units are being stored there. Therefore, Cordlife leases out its units on level 5 to generate rental income in the meantime. As operations scale up, management is of the view that fixed costs of running the facility will be spread out across a larger customer base, leading to greater operational efficiency and margin expansion for their Singapore operations.

Stable recurring cash flow and dividends indication

Stable cash flow generation Cordlifes payment plans include options for lump sum payments and/or recurring annual installments. Of the current c.48,000 customer base, about 25,000 are on installment plans. With a growing subscriber base, Cordlife expects a stable and recurring cash flow. Since IPO, the company has been free cash flow positive.
Figure 1: Steady growth in client base
50000 40000 30000 20000 10000 0 FY10 Existing client base
Source: Company reports.

40,000 32,800 26,200

FY11 Incremental clients

FY12

Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

Figure 2: Cordlife's business model generates stable, recurring cash flow

Source: Company reports.

Dividend indication at least 25% payout ratio Management highlighted that the company intends to recommend and distribute dividends of at least 25% of FY11 and FY12 net profit for FY12 and FY13. The stable cash flow generation should support this commitment. In FY12, Cordlife declared S$8.8 million in dividends or S$0.038/share, which translated to 128% payout ratio. This is inclusive of a S$0.018/share special dividend. We note that the payout in FY12 was higher than free cash flow generation for that year, and was probably supported by cash flow from FY11 where no dividends was paid out.
Table 1: Cordlife dividend payouts
S$ million Dividend Net income Payout ratio FCF Dividend/FCF
Source: Bloomberg, Company reports, J.P. Morgan.

FY11 0.0 8.5 0% 5.0 0%

FY12 8.8 6.9 128% 3.7 241%

Industry growth prospects

The private cord blood banking industry which Cordlife currently operates in is characterized by high penetration rates for developed markets (Hong Kong, Singapore, China) and low but rising penetration rate for developing markets (India, Philippines, Indonesia). It is driven largely by 4 demand factors: birth rates, rising affluence, increased acceptance and awareness, and government policy support. In Cordlife's key markets of Singapore and Hong Kong, while birth rates are expected to stay relatively low, growth will be driven by increasing penetration rates. On the other hand, in markets such as Philippines, Indonesia and India, growth is expected to be driven both by the larger number of births (higher birth rates and larger population base), and the increasing penetration rates which is forecasted to approximately double by 2015.

Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

Figure 3: Penetration rates for developing markets

0.25% 0.20% 0.15% 0.10% 0.05% 0.00% 2007 India 2011 Philippines Indonesia 2015F

Figure 4: Penetration rates for developed markets

30% 25% 20% 15% 10% 5% 0% 2007 Singapore 2011 Hong Kong China 2015F

Source: Deloitte & Touche Financial Advisory Services Limited report, Company reports.

Source: Deloitte & Touche Financial Advisory Services Limited report, Company reports. *China figures are for provinces with cord blood banking operations.

Table 2: Growth drivers for Cordlife's markets

Demand driver Public awareness/acceptance Singapore Most pregnant women informed at hospitals Marketing efforts to educate doctors and consumers Pro-family policies to boost birth rates, e.g. $2 billion Marriage & Parenthood Package 2013 Hong Kong Awareness has been raised through celebrity advertisements, marketing to doctors, and encouraging referrals Projected increase of birth rate from 0.74% (2011) to 0.76% (2015) Increased duration of free education to encourage having children Hong Kong citizens have subsidised health care, inclusive of cord blood transplant operations China Rising awareness of doctors and parents led by improved education and urbanisation Second most births annually in the world India Rising awareness led by intensive marketing efforts, as well as increased access to information through the internet Annual new births of 25.7 million expected by 2016 India predicted to become most populous nation by 2025 Philippines Both government and private cord blood banks are promoting cord blood banking to the general public Population expected to increase by 8 million from 2011 - 2015 Indonesia Rising awareness due to promotion activities by cord blood banks

Birth rates

Large population base, with annual new births expected at 4 million

Government policy / structural support

Cord blood banking can be paid through CDA

Stem cell industry is covered under China's 12th 5year plan

Affluence and expenditure

Ratio of private household expenditure on health care has been increasing (3.5% in 1998 to 5.3% in 2008)

Rising middle class leading to bigger pool of potential customers

Rising middle class

Relatively well developed healthcare system, with 86% of citizens enrolled in PhilHealth. Some packages cover stem cell related transplants Rising middle class: expected per capita disposable income to increase by 157% from 2007 - 2015

Per capita disposable income expected to increase 98% from 2007 - 2015

Source: Company reports, Deloitte & Touche Financial Advisory Services Limited report (10 April 2013), J.P. Morgan.

Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

Table 3: Cordlife peer valuation comparison

Company Cordlife Group Biosensors International IHH Healthcare Berhad Raffles Medical Group SG Healthcare Stock average Ticker CLGL SP BIG SP IHH SP RFMD SP Last Price (S$) 1.06 1.03 1.57 3.28 Market Cap (S$MM) 245 1,772 12,770 1,815 P/E (x) FY13E FY14E 23.4 20.7 11.9 10.5 47.1 38.5 29.0 24.5 27.9 23.5 2-yr EPS CAGR FY12-14E 12% 7% -5% 13% 7% P/B (x) FY13E 3.1 1.0 1.8 4.2 2.5 ROE (%) FY13E 15.5 9.1 4.0 15.4 11.0 Div yield (%) FY13E 2.0 0.9 0.4 1.4 1.2

Source: Bloomberg consensus estimates. Prices as of 1 August 2013 market close.

Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

Company background
Cordlife Group Limited was listed on the Singapore Exchange on 29 March 2012, raising S$26.3 million net of IPO expenses for the purpose of business expansion, renovation works on its new headquarters and financing working capital. As of 31 July 2013, 49% of IPO proceeds have been utilized.
Table 4: Update on the use of IPO proceeds
Intended use of IPO proceeds Estimated amount Estimated percentage of gross (S$ millions) proceeds raised from the IPO Development and expansion of business and operations in Singapore and overseas (includes June 2013 acquisition of Philippines, India and Indonesia assets) Renovation of proposed new headquarters and facility at Yishun, A'Posh Bizhub Investments in infrastructure relating to information technology Working capital and general corporate purposes Expenses incurred in connection with the IPO Total
Source: Company data.

Use of IPO proceeds as of 31 July 2013 Amount utilized Percentage of gross proceeds (S$ millions) raised from the IPO 9.8 1 0 0 3.7 14.5 33.2% 3.4% 0.0% 0.0% 12.5% 49.0%

16.6 3 2 4.7 3.4 29.7

55.9% 10.1% 6.7% 15.8% 11.5% 100%

The company has experienced rapid growth over the past year and now has a market capitalization of c.S$250 million.

Growing footprint across Asia

Cordlife Group was incorporated in May 2001 and is currently the larger of the two private cord blood banking service providers in Singapore and second largest in Hong Kong, with over 70% in market share in Singapore based on management estimates. Cordlife Hong Kong, along with the 10% stake it held in Guangzhou Tianhe Nuoya, a Cord Blood Banking operator in Guangzhou, was transferred into the Group in 2010. In November 2012, Cordlife Group divested the 10% stake in Guangzhou Tianhe Nuoya to China Cord Blood Corporation (CCBC) as partial consideration for a 10% stake in CCBC, which is listed on the NYSE. In June 2013, it acquired cord blood and tissue banking assets in India, the Philippines and Indonesia from Australian listed Life Corporation Limited (formerly Cordlife Limited), which the Cordlife group had demerged from previously. The group now has a customer base of approximately 48,000, of which a majority (c.40,000) is from its more matured Singapore operations. With the exception of China, Cordlife ranks top 3 in all other markets that it has a presence in. A breakdown of the largest 3 players in Cordlifes market segments are as follows:

Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

Table 5: Market position in key markets

Top 1 Top 2 Top 3 Total no. of companies Singapore Cordlife Stemcord 2 Hong Kong HealthBaby Cordlife Cryolife 6 Mainland China CCBC* Zhongyuan Shandong 8 India Lifecell CryoBanks Cordlife 11 Philippines Cordlife StemCord Medical City 5 Indonesia Cordlife BabyBanks StemCord 5

Source: Deloitte & Touche Financial Advisory Services Limited report (10 April 2013). *Cordlife has 10% share in China Cord Blood Corporation (CCBC).

Product mix
2 product types cord blood banking, and cord tissue banking Cordlife Group currently offers 2 products, cord blood banking and umbilical cord tissue banking services. The purpose of these services is to harvest stem cells from cord blood and umbilical cord tissue and store them for future use. Haematopoietic stem cells are harvested from cord blood and is effective in treating blood disorders and certain cancers such as Leukaemia, Lymphoma and Thalassaemia. Meanwhile, Epithelial and Mesenchymal stem cells are harvested from umbilical cord tissue and can be used to grow tissues and organs such as bone, cartilage, the liver, cornea or skin. With ongoing advances in medical research, there is potential in unlocking new treatments using stem cell technology.
Figure 5: Uses of Epithelial and Mesenchymal stem cells

Source: Company reports.

Rationale for private cord blood banking vs. public cord blood banking There are several reasons why customers choose to store cord blood. Firstly, the search for suitable stem cells from public cord blood banks for stem cell treatments is usually time-consuming and costly. The Singapore Cord Blood Bank (SCBB) charges a hefty S$26,000 search fee for local residents and US$25,000 for foreigners, which is in addition to hospital transplant fees. Secondly, by storing an individuals cord blood in a private cord blood bank, that individual is assured of a 100% match if he were to use it on himself or a 40% chance match among immediate family members should they require stem cell treatments. To date, management has guided that Cordlife Group has released 10 units of cord blood for its customers, all of which had been successfully engrafted in its patients.

Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

Pricing
Cordlife offers flexible pricing policies for its cord blood banking services, which are competitive with competitors such as StemCord. The storage period for Singapore customers is 21 years, after which the cord blood beneficiary will decide whether he or she wants to continue storage. Payments can be made using the Child Development Account (CDA) as Cordlife is an Approved Institution. The CDA is part of the Baby Bonus scheme and is a savings account where parents deposits are matched dollar for dollar by the government, up to a cap varying from $6,000 to $18,000 (depending on the child order).
Table 6: Cord blood banking prices in Singapore and Hong Kong
Singapore Cord Life Plan 2 Plan 3 S$4,200 S$6,200 S$250 (from yr 11-20) S$6,700 S$6,200 21 21 StemCord Sole plan $1,580 $275 (from yr 1-20) S$7,080 21 Hong Kong Cord Life Plan 1 HK$19,000 HK$1,500 (from yr 1-18) HK$46,000 18 Plan 2 HK$23,500 HK$1,500 (from yr 5-18) HK$44,500 18 Plan 3 HK$29,500 HK$1,500 (from yr 10-18) HK$43,000 18 Plan 4 HK$36,000 HK$36,000 18

Upfront payment Annual payment Total Storage period (yrs)

Source: Company data.

Plan 1 S$1,950 S$250 (from yr 1-20) S$6,950 21

Revenue structure
Revenue is derived mainly from the provision of cord blood banking services and is recognized based on a percentage of completion (POC) method. Given that expenses for processing cord blood samples are front loaded, 88% of revenue is recognized in the initial year of cord blood storage, while the remaining 12% is recognized in approximately equal portions at the completion of each year of storage. In FY12, South Asia operations, which consists of Singapore, the Philippines and Indonesia, accounted for 75% of revenue, while North Asia operations, consisting of Hong Kong, China and Macau accounted for the remaining 25%. As highlighted earlier, Singapore is a more profitable market with gross margin at c.70%. Business conditions in Hong Kong are more challenging due to the nature of the healthcare system. The seemingly higher proportion of North Asia profit against revenue is due to the share of associates' earnings from the company's 10% stake in China Stem Cells (South) which does not record attributable revenue.

Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

Figure 6: Cordlife's revenue distribution

Figure 7: Cordlife's profit distribution

North Asia 25%

North Asia 27% South Asia 73%

South Asia 75%

Source: Company data.

Source: Company data.

Cost structure
For FY12, cost of sales comprised 35% of total operating costs. This includes expenses in processing, testing and storage of cord blood, salaries for lab personnel, depreciation of lab equipment and lab rental expenses. Administrative expense contributes 37% towards total operating costs and relates to non-lab staff salaries, cost of consultancy services relating to finance and administration, depreciation of office and office rental expenses. Selling and marketing expenses comprise of advertising activities, salaries for marketing personnel and commissions (when referrals are made).
Figure 8: Cordlifes cost structure

Administrative expense 37%

COGS 35%

Selling and marketing expenses 28%

Source: Company data.

The Company reported healthy gross margin averaging 71.6% over the past four years. In FY12, gross margins fell marginally by 1 percentage point due to an increase in the cost of maternal blood testing brought about by increased stringency of the AABB standards.

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Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

Figure 9: Revenue and gross margins

S$ in millions
35 30 25 20 15 10 5 0 FY09 FY10 Revenue (L)
Source: Company data.

74% 73% 72% 71% 70% 69% 68% FY11 Gross margin (R) FY12

Key risks
We highlight below a few key risks to Cordlifes business: Competition in Singapore In July 2013, it was announced that AsiaMedic announced a joint venture with Cryoviva International to establish a cord blood banking venture in Singapore. It will be the 3rd player in Singapore. The strong margin which Cordlife enjoys in Singapore may come under pressure if pricing competition ensues. Lack of medical developments in cord blood usage Adoption of cord blood banking is dependent on the customers perceived expected benefits of cord blood. Cord blood therapy is still at an early stage of development and has a few limitations, such as the riskiness of treatment, long term viability of cryogenically frozen cord blood, and the insufficiency of a typical single cord blood harvest to treat an adult (one harvest typically has enough cells to treat a person up to 50kg). Therefore, the lack of medical developments may reduce adoption rate for cord blood banking. Slow penetration of cord blood banking in Philippines, India, and Indonesia While the developing markets present potential through the large number of births, penetration rates remain low. Given the recent acquisitions in the Philippines, India and Indonesia region (which has only just achieved breakeven), the risk that market penetration does not increase as expected is a concern. Regulatory risks Changes in the regulatory environment which Cordlife operates in can pose risks. For example, a change in the blood testing requirements under the AABB had caused an increase in costs and decrease in profit margins for Cordlife in FY12. Similarly, a reduction in the Baby Bonus scheme could put pressures on profits. Additionally, the recent moratorium which banned Mainland Chinese mothers from giving birth in Hong Kong impacted revenues in Hong Kong.

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Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

Major shareholders
Table 7: Major shareholders
Shareholders Wells Spring Pte Ltd Coop International Pte Ltd China Stem Cells (East) Co Ltd Mr. Yee Pinh Jeremy Ms Jin Lu Dr. Ho Choon Hou Cordlife Group Ltd Free Float
Source: Bloomberg, J.P. Morgan.

% 10.84 10.52 10.48 0.71 0.28 0.27 0.09 65.9

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Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

Cordlife Group Limited: Summary of financials

SGD in millions, year-end Jun Profit and loss statement Revenues % change Y/Y EBITDA % change Y/Y EBITDA margin (%) EBIT % change Y/Y EBIT margin (%) Net interest Earnings before tax % change Y/Y Tax as % of EBT Minority Interests Net income Net income (recurring) % change Y/Y Share outstanding EPS (S$) (recurring) Balance Sheet Cash Accounts receivable Inventories Others Current assets LT investments Net fixed assets Total Assets ST bank loans Payables Total current liabilities Long term debt Other liabilities Total liabilities Shareholder's equity Total liabilities and equity BVPS (S$)
Source: Bloomberg.

Cash flow statement FY10 28 25% 8 16% 28% 7 15% 26% 0.0 7 15% -2 21% 0 8 8 34% 232 0.04 FY10 8 8 0 5 21 21 2 59 1 1 21 0 5 26 33 59 0.14 FY11 26 -9% 7 -14% 26% 6 -17% 24% 0.0 6 -17% -1 24% 0 8 8 2% 232 0.04 FY11 4 7 0 2 13 23 4 55 0 0 8 1 6 15 41 55 0.17 FY12 29 12% 5 -30% 16% 4 -35% 14% 0.0 4 -34% -1 21% 0 7 9 4% 232 0.04 FY12 19 9 0 1 29 26 6 90 0 1 8 2 8 19 71 90 0.31 Net profit Depreciation & amortization Other non-cash items Change in working capital Cash flow from operations Capex Disposal/ (purchase) Cash flow from investing Equity raised/(repaid) Debt raised/(repaid) Other Dividends Cash flow from financing Net changes in cash Beginning cash Ending cash Free cash flow DPS (S$) Ratio Analysis EBITDA margin (%) EBIT margin (%) FY10 28% 26% FY11 26% 24% FY12 16% 14% FY10 8 0 1 0 8 -2 -11 -13 0 0 6 0 6 1 7 8 7 0.00 FY11 8 1 0 1 8 -3 -1 -4 0 0 -7 0 -7 -3 8 5 5 0.00 FY12 7 1 1 -1 6 -2 -18 -20 26 2 0 -5 23 9 4 13 4 0.02

Sales growth (%) EBITDA growth (%) Net profit growth (%) Net profit (recurring) growth (%) Interest coverage (x) Net debt/equity (%) Sales/Assets (%) Assets/Equity (%) ROCE (%) ROE (%)

25% 16% 34% 34% 171 Net cash 48% 178% 28% 25%

-9% -14% 2% 2% 156 Net cash 46% 137% 23% 21%

12% -30% -18% 4% 313 Net cash 32% 127% 12% 10%

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Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

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Other Disclosures
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Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

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Ying-Jian Chan, CFA (65) 6882-2378 ying.jian.yj.chan@jpmorgan.com

Asia Pacific Equity Research 01 August 2013

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