12th khazanah annual review

2
07 | VALUE DISTRIBUTION 08 | CONTRIBUTION TO NATIONAL DEVELOPMENT 09 | 2016 OUTLOOK IN SUMMARY Khazanah continues to deepen its role in social development through several initiatives, in particular via Yayasan Hasanah (“YH”). Continuous learning among employees and stakeholders, enabling the exchange of views and information in the business and academic world, and society in general. • RM80m committed for Khazanah SL1M Programme with 1,083 graduates enrolled • Khazanah-IHH Healthcare Fund – RM20m sponsored treatment for 3,100 patients over two years • RM17.4m spent on flood relief and various humanitarian efforts since 2013 • 32 Trust Schools rolled out in 2015, bringing total to 62 schools • Inaugural RM100m Sustainable and Responsible Investments (“SRI”) sukuk • RM96m CR contribution in 2015 Khazanah Research Institute (“KRI”) has undertaken fact-based analysis and research on the nation’s economic development, focusing on inclusivity. Research includes impact of trade policies, housing affordability and public transportation. In addition, Khazanah continues to support government policy formation through various channels including boards of public service organisations in areas such as Economic Management, Education, Technology & Innovation and Trade & Export Promotion. HASANAH REPORT 2014 THE KNOWLEDGE DEVELOPMENT POLICY SUPPORT • Volatile and uncertain conditions expected to continue in 2016. • 2016 also marks the 10-year anniversary of Iskandar Malaysia. • Khazanah will continue to stay the course with focus on: Delivering long-term financial and strategic performance National development initiatives including value distribution Expanding international presence Strengthening institutional integrity • Khazanah’s portfolio is resilient and well positioned to continue to undertake its commercial and national development mandate. 13 JANUARY 2016 22 8 6 4 24 15 25 10 | 2015 IN REVIEW JANUARY 2016 is brochure is printed on environmentally friendly paper. Please recycle and help save our planet. www.khazanah.com.my 11 th Khazanah Annual Review e Khazanah Report 2014 launched Completed acquisition of 100% stake in Sabiha Gökçen airport Termination letters for MAS employees to move to MAB, and operationalisation of Corporate Development Centre Acquired property in St.Kilda, Melbourne Awarded LOA for HSBB2 CIMB-RHB-MBSB bank merger negotiation terminated Appointed Christoph Mueller as MD and CEO Acquired 51% of Continental Hospitals, India Acquired 73.4% of Global Hospitals, India Cikopo-Palimanan toll road launched by Indonesian President Completed RM1.3bn rights issuance Acquired 70% of Jimah East Divested 2.0% stake (RM1.6bn) via market placement Budget 2015 Review: Preemptive economic measures announced Aviation Commission Bill passed by Dewan Rakyat PCG #28 PCG #29 Announcement of new appointments to Khazanah’s Senior Leadership Team Issuance of world’s first Ringgit- denominated SRI sukuk Khazanah Europe Investment Limited office established in London Khazanah announced additional & accelerated domestic investments of RM6.77bn Global Science and Innovation Advisory Council meeting, New York meeting, New York Tan Sri Dr. Mohd Irwan Serigar appointed to Khazanah’s Board Special Economic Committee (SEC) established Proactive economic measures announced by PM Pacific nations reached agreement on TPP negotiations Khazanah renews Managing Director’s contract Budget 2016 tabled “Why Trade Matters” report published ASEAN Summit East Asia Summit World Islamic Economic Forum, KL GLCT Programme Graduation “Making Housing Affordable” report published RM3bn endowment & Board of Trustees announced for Yayasan Hasanah Malaysia Business Luncheon at Davos JV with leading Philippines telco companies Iskandar Investment Berhad capital restructuring completed HASANAH JAN FEB MAR APR Investee companies Key events MAY JUN JUL AUG SEP OCT NOV DEC 5 14 14 20 28 25 21 26 28 1 13 5 3 30 24 26 28 7 7-9 4-5 28 18 2 5 14 21 29 1 14 5 23 16 18-22 21-22 3-5 20 9 RM20bn injection into ValueCap announced Lease agreement to operate 350-bed hospital in Chengdu, China Partnership with Emirates Acquired 80% stake in Nepal mobile operator, Ncell Completion of project Acquired 75% of Digicel Myanmar Tower Company Ltd Acquired 30% stake in Turkish power company, Gama Enerji AS 14 JV with Minor Group announced to develop Anantara resort in Desaru Coast 14 16 MAB begins operations Education 68% Knowledge 13% Public Spaces 8% Others 4% RM575m CR spent by Khazanah and YH since 2006 12 TH KHAZANAH ANNUAL REVIEW Review of 2015 & Outlook for 2016 2016 Graduating to a Higher Class: Nation-Building, Touching Lives

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Page 1: 12TH KHAZANAH ANNUAL REVIEW

07 | VALUE DISTRIBUTION

08 | CONTRIBUTION TO NATIONAL DEVELOPMENT

09 | 2016 OUTLOOK IN SUMMARY

Khazanah continues to deepen its role in social development through several initiatives, in particular via Yayasan Hasanah (“YH”).

Continuous learning among employees and stakeholders, enabling the exchange of views and information in the business and academic world, and society in general.

• RM80m committed for Khazanah SL1M Programme with 1,083 graduates enrolled

• Khazanah-IHH Healthcare Fund – RM20m sponsored treatment for 3,100 patients over two years

• RM17.4m spent on flood relief and various humanitarian efforts since 2013

• 32 Trust Schools rolled out in 2015, bringing total to 62 schools

• Inaugural RM100m Sustainable and Responsible Investments (“SRI”) sukuk

• RM96m CR contribution in 2015

Khazanah Research Institute (“KRI”) has undertaken fact-based analysis and research on the nation’s economic development, focusing on inclusivity.

Research includes impact of trade policies, housing affordability and public transportation.

In addition, Khazanah continues to support government policy formation through various channels including boards of public service organisations in areas such as Economic Management, Education, Technology & Innovation and Trade & Export Promotion.

HASANAH REPORT 2014

THE

KNOWLEDGE DEVELOPMENT POLICY SUPPORT

• Volatile and uncertain conditions expected to continue in 2016.

• 2016 also marks the 10-year anniversary of Iskandar Malaysia.

• Khazanah will continue to stay the course with focus on:

• Delivering long-term financial and strategic performance• National development initiatives including value distribution• Expanding international presence• Strengthening institutional integrity

• Khazanah’s portfolio is resilient and well positioned to continue to undertake its commercial and national development mandate.

13 JANUARY 2016

228

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12TH KHAZANAH ANNUAL REVIEW

Review of 2015 & Outlook for 2016

2016

Graduating to a Higher Class:Nation-Building, Touching Lives

7 - 9 August 2015, Kuala Lumpur Convention Centre

Page 2: 12TH KHAZANAH ANNUAL REVIEW

SOUTHEAST ASIA

CHINA

TURKEY

MIDDLE EAST INDIA &INDIAN SUBCONTINENT

CANADA

USA

CANADA

EUROPEANUNION

JAPAN & KOREA

AUSTRALIA

AFRICA

San Francisco, 2013

Istanbul, 2013

Mumbai, 2008

Beijing, 2008

London, 2015

Khazanah offices

Investee companies’ presence

Khazanah coverage since:

2004

2005

2008

2009

2009

2012

2015

01 | PORTFOLIO PERFORMANCE

02 | FINANCIAL PERFORMANCE

03 | PORTFOLIO SEGMENTATION 06 | CATALYSING GROWTH & VALUE CREATION

04 | INVESTMENTS & DIVESTMENTS

05 | GLC TRANSFORMATION

PORTFOLIO AS AT (RM bn) 14 May 04 31 Dec 14 31 Dec 151 ∆ 2014-15 ∆ 2004-15

Realisable Asset Value2 (“RAV”)

50.9 145.5 150.2 +RM4.7bn(+3.2%)

+RM99.3bn (+9.7% p.a.4)

Net Worth Adjusted3 (“NWA”)

33.3 110.7 109.0 -RM1.8bn (-1.6%)

+RM75.7bn (+10.7% p.a.4)

RAV/Liabilities ("RAV Cover") [x]

2.9 3.7 3.1

Shareholders’ Funds 7.7 35.3 35.6 +RM0.3bn(+0.8%)

+RM28.0bn(+14.1% p.a.4)

RAV2 (RM bn)

150.2

RAV Cover (times)

3.1

NWA3 (RM bn)

109.0

CAGR4

(p.a.)

K-7 Index 11.1%G20 Index 10.5%FBM KLCI 10.8%

100=14/5/04

May04

May05

May06

May07

May08

May09

May10

May11

May12

May13

May14

May15

G20

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2013

2008 +RM9bn(+782%)

-RM1bn (-12%)

79

30

2013

2004

2013

2004

2013

2004

2013

2004

2013

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28+RM37bn(+133%)

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59

12 +RM46bn(+374%)

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11

Demerger and streamlining of

focus; regional growth strategy

Regional leadership

Industry reforms

Financial restructuring and

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and focus on Iskandar Malaysia

Challenging global operating

environment

18.9%

6.8%

15.9%

9.6%

24.2%

37.1%

(15.6%)-20%

-10%

0%

10%

20%

30%

40%

TM Axiata CIMB TNB MAHB UEM Sunrise

MAS

Total Shareholders’ Return5

RAV (RM bn)

145.5 150.2

50.9

31 Dec 2015

14 May 2004

31 Dec 2014

160

120

80

40

0

+RM99.3bn

+RM4.7bn -RM1.8bnNWA (RM bn)

109.0

33.3

31 Dec 2015

14 May 2004

31 Dec 2014

120

80

40

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+RM75.7bn

110.7

33.3

24.0

18.7

17.5

13.5 4.8 3.8

(7.3)0.7 109.0

NWA NWA31 Dec 2015

14 May2004

Telco

Healthcare

TNB UEM

GroupCIM

BAlib

aba

Aviatio

nOthers

Co

ntr

ibu

tio

n (

RM

bn

)

2015 Contribution (RM bn)

Total Shareholders’ Returns (in local currency terms)

(0.9) 6.5 (0.2) (0.7) (2.3) (0.1) (2.0) (2.1)(1.6%)

(1.0%)

(11.4%)

(10.5%)

(4.0%)

11.2%

(3.7%)

(2.0%)

(14.1%)

(14.9%)

(9.2%)

(0.3%)

(20%) (15%) (10%) (5%) 0% 5% 10% 15%

Straits Times Index

MSCI Asia ex-Japan

MSCI AC World

MSCI Emerging Markets

SENSEX

Istanbul Index

Philippines Index

Hang Seng Index

Shanghai Index

Jakarta Composite Index

FBM KLCI

NWA Growth

HEALTHCARE17.2%

POWER15.3%

FIG13.7%

PROPERTY10.6% TRANSPORTATION

& LOGISTICS4.9%

INNOVATION &TECHNOLOGY

2.3%

LEISURE & TOURISM

2.0%

SUSTAINABLE DEV.1.3%

OTHERS2.5%

CONSUMER0.7%

AGRIFOOD0.4%

LIFE SCIENCES0.4%

CREATIVE0.3%

EDUCATION0.0%

INFRASTRUCTURE & CONSTRUCTION

3.8%

CASH2.5%

MEDIA & COMMS22.0%

SINGAPORE5.4%

OTHERS2.4%

INDIA1.9%

TURKEY 1.2%

PHILIPPINES1.1%

MIDDLE EAST0.9%INDONESIA

0.3%

MALAYSIA80.9 %

CHINA6.1%

90

140

190

240

290

340

390

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015E

5

10

15

20

25

30

9.97.0

10.5

19.2

14.511.8

17.1

20.6

26.1 26.3 26.224.0

2.7

6.3

11.4

6.3 7.510.4 10.1

13.2 13.5 12.7 13.1

5.2

INDIA4.1%

OTHERS1.5%

SRI LANKA1.5%

BANGLADESH1.4%

NORTH AMERICA

1.3%PHILIPPINES

1.1%

MIDDLE EAST0.8%

EUROPE 0.3%

CAMBODIA0.4%

JAPAN0.2%

THAILAND0.5%

AFRICA0.1%

MALAYSIA55.1%

SINGAPORE12.1%

TURKEY7.4%

CHINA6.5%

INDONESIA5.7%

CAGR4

(p.a.)

K-7 Index 11.1%G20 Index 10.5%FBM KLCI 10.8%

100=14/5/04

May04

May05

May06

May07

May08

May09

May10

May11

May12

May13

May14

May15

G20

K-7

2013

2008 +RM9bn(+782%)

-RM1bn (-12%)

79

30

2013

2004

2013

2004

2013

2004

2013

2004

2013

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+RM49bn(+164%)

64

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6

59

12 +RM46bn(+374%)

11

+RM10bn(+600%)

2

1

11

Demerger and streamlining of

focus; regional growth strategy

Regional leadership

Industry reforms

Financial restructuring and

careful regional expansion

Collaboration with private sector

and focus on Iskandar Malaysia

Challenging global operating

environment

18.9%

6.8%

15.9%

9.6%

24.2%

37.1%

(15.6%)-20%

-10%

0%

10%

20%

30%

40%

TM Axiata CIMB TNB MAHB UEM Sunrise

MAS

Total Shareholders’ Return5

RAV (RM bn)

145.5 150.2

50.9

31 Dec 2015

14 May 2004

31 Dec 2014

160

120

80

40

0

+RM99.3bn

+RM4.7bn -RM1.8bnNWA (RM bn)

109.0

33.3

31 Dec 2015

14 May 2004

31 Dec 2014

120

80

40

0

+RM75.7bn

110.7

33.3

24.0

18.7

17.5

13.5 4.8 3.8

(7.3)0.7 109.0

NWA NWA31 Dec 2015

14 May2004

Telco

Healthcare

TNB UEM

GroupCIM

BAlib

aba

Aviatio

nOthers

Co

ntr

ibu

tio

n (

RM

bn

)

2015 Contribution (RM bn)

Total Shareholders’ Returns (in local currency terms)

(0.9) 6.5 (0.2) (0.7) (2.3) (0.1) (2.0) (2.1)(1.6%)

(1.0%)

(11.4%)

(10.5%)

(4.0%)

11.2%

(3.7%)

(2.0%)

(14.1%)

(14.9%)

(9.2%)

(0.3%)

(20%) (15%) (10%) (5%) 0% 5% 10% 15%

Straits Times Index

MSCI Asia ex-Japan

MSCI AC World

MSCI Emerging Markets

SENSEX

Istanbul Index

Philippines Index

Hang Seng Index

Shanghai Index

Jakarta Composite Index

FBM KLCI

NWA Growth

HEALTHCARE17.2%

POWER15.3%

FIG13.7%

PROPERTY10.6% TRANSPORTATION

& LOGISTICS4.9%

INNOVATION &TECHNOLOGY

2.3%

LEISURE & TOURISM

2.0%

SUSTAINABLE DEV.1.3%

OTHERS2.5%

CONSUMER0.7%

AGRIFOOD0.4%

LIFE SCIENCES0.4%

CREATIVE0.3%

EDUCATION0.0%

INFRASTRUCTURE & CONSTRUCTION

3.8%

CASH2.5%

MEDIA & COMMS22.0%

SINGAPORE5.4%

OTHERS2.4%

INDIA1.9%

TURKEY 1.2%

PHILIPPINES1.1%

MIDDLE EAST0.9%INDONESIA

0.3%

MALAYSIA80.9 %

CHINA6.1%

90

140

190

240

290

340

390

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015E

5

10

15

20

25

30

9.97.0

10.5

19.2

14.511.8

17.1

20.6

26.1 26.3 26.224.0

2.7

6.3

11.4

6.3 7.510.4 10.1

13.2 13.5 12.7 13.1

5.2

INDIA4.1%

OTHERS1.5%

SRI LANKA1.5%

BANGLADESH1.4%

NORTH AMERICA

1.3%PHILIPPINES

1.1%

MIDDLE EAST0.8%

EUROPE 0.3%

CAMBODIA0.4%

JAPAN0.2%

THAILAND0.5%

AFRICA0.1%

MALAYSIA55.1%

SINGAPORE12.1%

TURKEY7.4%

CHINA6.5%

INDONESIA5.7%

CAGR4

(p.a.)

K-7 Index 11.1%G20 Index 10.5%FBM KLCI 10.8%

100=14/5/04

May04

May05

May06

May07

May08

May09

May10

May11

May12

May13

May14

May15

G20

K-7

2013

2008 +RM9bn(+782%)

-RM1bn (-12%)

79

30

2013

2004

2013

2004

2013

2004

2013

2004

2013

2004

+RM49bn(+164%)

64

28+RM37bn(+133%)

5

6

59

12 +RM46bn(+374%)

11

+RM10bn(+600%)

2

1

11

Demerger and streamlining of

focus; regional growth strategy

Regional leadership

Industry reforms

Financial restructuring and

careful regional expansion

Collaboration with private sector

and focus on Iskandar Malaysia

Challenging global operating

environment

18.9%

6.8%

15.9%

9.6%

24.2%

37.1%

(15.6%)-20%

-10%

0%

10%

20%

30%

40%

TM Axiata CIMB TNB MAHB UEM Sunrise

MAS

Total Shareholders’ Return5

RAV (RM bn)

145.5 150.2

50.9

31 Dec 2015

14 May 2004

31 Dec 2014

160

120

80

40

0

+RM99.3bn

+RM4.7bn -RM1.8bnNWA (RM bn)

109.0

33.3

31 Dec 2015

14 May 2004

31 Dec 2014

120

80

40

0

+RM75.7bn

110.7

33.3

24.0

18.7

17.5

13.5 4.8 3.8

(7.3)0.7 109.0

NWA NWA31 Dec 2015

14 May2004

Telco

Healthcare

TNB UEM

GroupCIM

BAlib

aba

Aviatio

nOthers

Co

ntr

ibu

tio

n (

RM

bn

)

2015 Contribution (RM bn)

Total Shareholders’ Returns (in local currency terms)

(0.9) 6.5 (0.2) (0.7) (2.3) (0.1) (2.0) (2.1)(1.6%)

(1.0%)

(11.4%)

(10.5%)

(4.0%)

11.2%

(3.7%)

(2.0%)

(14.1%)

(14.9%)

(9.2%)

(0.3%)

(20%) (15%) (10%) (5%) 0% 5% 10% 15%

Straits Times Index

MSCI Asia ex-Japan

MSCI AC World

MSCI Emerging Markets

SENSEX

Istanbul Index

Philippines Index

Hang Seng Index

Shanghai Index

Jakarta Composite Index

FBM KLCI

NWA Growth

HEALTHCARE17.2%

POWER15.3%

FIG13.7%

PROPERTY10.6% TRANSPORTATION

& LOGISTICS4.9%

INNOVATION &TECHNOLOGY

2.3%

LEISURE & TOURISM

2.0%

SUSTAINABLE DEV.1.3%

OTHERS2.5%

CONSUMER0.7%

AGRIFOOD0.4%

LIFE SCIENCES0.4%

CREATIVE0.3%

EDUCATION0.0%

INFRASTRUCTURE & CONSTRUCTION

3.8%

CASH2.5%

MEDIA & COMMS22.0%

SINGAPORE5.4%

OTHERS2.4%

INDIA1.9%

TURKEY 1.2%

PHILIPPINES1.1%

MIDDLE EAST0.9%INDONESIA

0.3%

MALAYSIA80.9 %

CHINA6.1%

90

140

190

240

290

340

390

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015E

5

10

15

20

25

30

9.97.0

10.5

19.2

14.511.8

17.1

20.6

26.1 26.3 26.224.0

2.7

6.3

11.4

6.3 7.510.4 10.1

13.2 13.5 12.7 13.1

5.2

INDIA4.1%

OTHERS1.5%

SRI LANKA1.5%

BANGLADESH1.4%

NORTH AMERICA

1.3%PHILIPPINES

1.1%

MIDDLE EAST0.8%

EUROPE 0.3%

CAMBODIA0.4%

JAPAN0.2%

THAILAND0.5%

AFRICA0.1%

MALAYSIA55.1%

SINGAPORE12.1%

TURKEY7.4%

CHINA6.5%

INDONESIA5.7%

CAGR4

(p.a.)

K-7 Index 11.1%G20 Index 10.5%FBM KLCI 10.8%

100=14/5/04

May04

May05

May06

May07

May08

May09

May10

May11

May12

May13

May14

May15

G20

K-7

2013

2008 +RM9bn(+782%)

-RM1bn (-12%)

79

30

2013

2004

2013

2004

2013

2004

2013

2004

2013

2004

+RM49bn(+164%)

64

28+RM37bn(+133%)

5

6

59

12 +RM46bn(+374%)

11

+RM10bn(+600%)

2

1

11

Demerger and streamlining of

focus; regional growth strategy

Regional leadership

Industry reforms

Financial restructuring and

careful regional expansion

Collaboration with private sector

and focus on Iskandar Malaysia

Challenging global operating

environment

18.9%

6.8%

15.9%

9.6%

24.2%

37.1%

(15.6%)-20%

-10%

0%

10%

20%

30%

40%

TM Axiata CIMB TNB MAHB UEM Sunrise

MAS

Total Shareholders’ Return5

RAV (RM bn)

145.5 150.2

50.9

31 Dec 2015

14 May 2004

31 Dec 2014

160

120

80

40

0

+RM99.3bn

+RM4.7bn -RM1.8bnNWA (RM bn)

109.0

33.3

31 Dec 2015

14 May 2004

31 Dec 2014

120

80

40

0

+RM75.7bn

110.7

33.3

24.0

18.7

17.5

13.5 4.8 3.8

(7.3)0.7 109.0

NWA NWA31 Dec 2015

14 May2004

Telco

Healthcare

TNB UEM

GroupCIM

BAlib

aba

Aviatio

nOthers

Co

ntr

ibu

tio

n (

RM

bn

)

2015 Contribution (RM bn)

Total Shareholders’ Returns (in local currency terms)

(0.9) 6.5 (0.2) (0.7) (2.3) (0.1) (2.0) (2.1)(1.6%)

(1.0%)

(11.4%)

(10.5%)

(4.0%)

11.2%

(3.7%)

(2.0%)

(14.1%)

(14.9%)

(9.2%)

(0.3%)

(20%) (15%) (10%) (5%) 0% 5% 10% 15%

Straits Times Index

MSCI Asia ex-Japan

MSCI AC World

MSCI Emerging Markets

SENSEX

Istanbul Index

Philippines Index

Hang Seng Index

Shanghai Index

Jakarta Composite Index

FBM KLCI

NWA Growth

HEALTHCARE17.2%

POWER15.3%

FIG13.7%

PROPERTY10.6% TRANSPORTATION

& LOGISTICS4.9%

INNOVATION &TECHNOLOGY

2.3%

LEISURE & TOURISM

2.0%

SUSTAINABLE DEV.1.3%

OTHERS2.5%

CONSUMER0.7%

AGRIFOOD0.4%

LIFE SCIENCES0.4%

CREATIVE0.3%

EDUCATION0.0%

INFRASTRUCTURE & CONSTRUCTION

3.8%

CASH2.5%

MEDIA & COMMS22.0%

SINGAPORE5.4%

OTHERS2.4%

INDIA1.9%

TURKEY 1.2%

PHILIPPINES1.1%

MIDDLE EAST0.9%INDONESIA

0.3%

MALAYSIA80.9 %

CHINA6.1%

90

140

190

240

290

340

390

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015E

5

10

15

20

25

30

9.97.0

10.5

19.2

14.511.8

17.1

20.6

26.1 26.3 26.224.0

2.7

6.3

11.4

6.3 7.510.4 10.1

13.2 13.5 12.7 13.1

5.2

INDIA4.1%

OTHERS1.5%

SRI LANKA1.5%

BANGLADESH1.4%

NORTH AMERICA

1.3%PHILIPPINES

1.1%

MIDDLE EAST0.8%

EUROPE 0.3%

CAMBODIA0.4%

JAPAN0.2%

THAILAND0.5%

AFRICA0.1%

MALAYSIA55.1%

SINGAPORE12.1%

TURKEY7.4%

CHINA6.5%

INDONESIA5.7%

CAGR4

(p.a.)

K-7 Index 11.1%G20 Index 10.5%FBM KLCI 10.8%

100=14/5/04

May04

May05

May06

May07

May08

May09

May10

May11

May12

May13

May14

May15

G20

K-7

2013

2008 +RM9bn(+782%)

-RM1bn (-12%)

79

30

2013

2004

2013

2004

2013

2004

2013

2004

2013

2004

+RM49bn(+164%)

64

28+RM37bn(+133%)

5

6

59

12 +RM46bn(+374%)

11

+RM10bn(+600%)

2

1

11

Demerger and streamlining of

focus; regional growth strategy

Regional leadership

Industry reforms

Financial restructuring and

careful regional expansion

Collaboration with private sector

and focus on Iskandar Malaysia

Challenging global operating

environment

18.9%

6.8%

15.9%

9.6%

24.2%

37.1%

(15.6%)-20%

-10%

0%

10%

20%

30%

40%

TM Axiata CIMB TNB MAHB UEM Sunrise

MAS

Total Shareholders’ Return5

RAV (RM bn)

145.5 150.2

50.9

31 Dec 2015

14 May 2004

31 Dec 2014

160

120

80

40

0

+RM99.3bn

+RM4.7bn -RM1.8bnNWA (RM bn)

109.0

33.3

31 Dec 2015

14 May 2004

31 Dec 2014

120

80

40

0

+RM75.7bn

110.7

33.3

24.0

18.7

17.5

13.5 4.8 3.8

(7.3)0.7 109.0

NWA NWA31 Dec 2015

14 May2004

Telco

Healthcare

TNB UEM

GroupCIM

BAlib

aba

Aviatio

nOthers

Co

ntr

ibu

tio

n (

RM

bn

)

2015 Contribution (RM bn)

Total Shareholders’ Returns (in local currency terms)

(0.9) 6.5 (0.2) (0.7) (2.3) (0.1) (2.0) (2.1)(1.6%)

(1.0%)

(11.4%)

(10.5%)

(4.0%)

11.2%

(3.7%)

(2.0%)

(14.1%)

(14.9%)

(9.2%)

(0.3%)

(20%) (15%) (10%) (5%) 0% 5% 10% 15%

Straits Times Index

MSCI Asia ex-Japan

MSCI AC World

MSCI Emerging Markets

SENSEX

Istanbul Index

Philippines Index

Hang Seng Index

Shanghai Index

Jakarta Composite Index

FBM KLCI

NWA Growth

HEALTHCARE17.2%

POWER15.3%

FIG13.7%

PROPERTY10.6% TRANSPORTATION

& LOGISTICS4.9%

INNOVATION &TECHNOLOGY

2.3%

LEISURE & TOURISM

2.0%

SUSTAINABLE DEV.1.3%

OTHERS2.5%

CONSUMER0.7%

AGRIFOOD0.4%

LIFE SCIENCES0.4%

CREATIVE0.3%

EDUCATION0.0%

INFRASTRUCTURE & CONSTRUCTION

3.8%

CASH2.5%

MEDIA & COMMS22.0%

SINGAPORE5.4%

OTHERS2.4%

INDIA1.9%

TURKEY 1.2%

PHILIPPINES1.1%

MIDDLE EAST0.9%INDONESIA

0.3%

MALAYSIA80.9 %

CHINA6.1%

90

140

190

240

290

340

390

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015E

5

10

15

20

25

30

9.97.0

10.5

19.2

14.511.8

17.1

20.6

26.1 26.3 26.224.0

2.7

6.3

11.4

6.3 7.510.4 10.1

13.2 13.5 12.7 13.1

5.2

INDIA4.1%

OTHERS1.5%

SRI LANKA1.5%

BANGLADESH1.4%

NORTH AMERICA

1.3%PHILIPPINES

1.1%

MIDDLE EAST0.8%

EUROPE 0.3%

CAMBODIA0.4%

JAPAN0.2%

THAILAND0.5%

AFRICA0.1%

MALAYSIA55.1%

SINGAPORE12.1%

TURKEY7.4%

CHINA6.5%

INDONESIA5.7%

CAGR4

(p.a.)

K-7 Index 11.1%G20 Index 10.5%FBM KLCI 10.8%

100=14/5/04

May04

May05

May06

May07

May08

May09

May10

May11

May12

May13

May14

May15

G20

K-7

2013

2008 +RM9bn(+782%)

-RM1bn (-12%)

79

30

2013

2004

2013

2004

2013

2004

2013

2004

2013

2004

+RM49bn(+164%)

64

28+RM37bn(+133%)

5

6

59

12 +RM46bn(+374%)

11

+RM10bn(+600%)

2

1

11

Demerger and streamlining of

focus; regional growth strategy

Regional leadership

Industry reforms

Financial restructuring and

careful regional expansion

Collaboration with private sector

and focus on Iskandar Malaysia

Challenging global operating

environment

18.9%

6.8%

15.9%

9.6%

24.2%

37.1%

(15.6%)-20%

-10%

0%

10%

20%

30%

40%

TM Axiata CIMB TNB MAHB UEM Sunrise

MAS

Total Shareholders’ Return5

RAV (RM bn)

145.5 150.2

50.9

31 Dec 2015

14 May 2004

31 Dec 2014

160

120

80

40

0

+RM99.3bn

+RM4.7bn -RM1.8bnNWA (RM bn)

109.0

33.3

31 Dec 2015

14 May 2004

31 Dec 2014

120

80

40

0

+RM75.7bn

110.7

33.3

24.0

18.7

17.5

13.5 4.8 3.8

(7.3)0.7 109.0

NWA NWA31 Dec 2015

14 May2004

Telco

Healthcare

TNB UEM

GroupCIM

BAlib

aba

Aviatio

nOthers

Co

ntr

ibu

tio

n (

RM

bn

)

2015 Contribution (RM bn)

Total Shareholders’ Returns (in local currency terms)

(0.9) 6.5 (0.2) (0.7) (2.3) (0.1) (2.0) (2.1)(1.6%)

(1.0%)

(11.4%)

(10.5%)

(4.0%)

11.2%

(3.7%)

(2.0%)

(14.1%)

(14.9%)

(9.2%)

(0.3%)

(20%) (15%) (10%) (5%) 0% 5% 10% 15%

Straits Times Index

MSCI Asia ex-Japan

MSCI AC World

MSCI Emerging Markets

SENSEX

Istanbul Index

Philippines Index

Hang Seng Index

Shanghai Index

Jakarta Composite Index

FBM KLCI

NWA Growth

HEALTHCARE17.2%

POWER15.3%

FIG13.7%

PROPERTY10.6% TRANSPORTATION

& LOGISTICS4.9%

INNOVATION &TECHNOLOGY

2.3%

LEISURE & TOURISM

2.0%

SUSTAINABLE DEV.1.3%

OTHERS2.5%

CONSUMER0.7%

AGRIFOOD0.4%

LIFE SCIENCES0.4%

CREATIVE0.3%

EDUCATION0.0%

INFRASTRUCTURE & CONSTRUCTION

3.8%

CASH2.5%

MEDIA & COMMS22.0%

SINGAPORE5.4%

OTHERS2.4%

INDIA1.9%

TURKEY 1.2%

PHILIPPINES1.1%

MIDDLE EAST0.9%INDONESIA

0.3%

MALAYSIA80.9 %

CHINA6.1%

90

140

190

240

290

340

390

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015E

5

10

15

20

25

30

9.97.0

10.5

19.2

14.511.8

17.1

20.6

26.1 26.3 26.224.0

2.7

6.3

11.4

6.3 7.510.4 10.1

13.2 13.5 12.7 13.1

5.2

INDIA4.1%

OTHERS1.5%

SRI LANKA1.5%

BANGLADESH1.4%

NORTH AMERICA

1.3%PHILIPPINES

1.1%

MIDDLE EAST0.8%

EUROPE 0.3%

CAMBODIA0.4%

JAPAN0.2%

THAILAND0.5%

AFRICA0.1%

MALAYSIA55.1%

SINGAPORE12.1%

TURKEY7.4%

CHINA6.5%

INDONESIA5.7%

CAGR4

(p.a.)

K-7 Index 11.1%G20 Index 10.5%FBM KLCI 10.8%

100=14/5/04

May04

May05

May06

May07

May08

May09

May10

May11

May12

May13

May14

May15

G20

K-7

2013

2008 +RM9bn(+782%)

-RM1bn (-12%)

79

30

2013

2004

2013

2004

2013

2004

2013

2004

2013

2004

+RM49bn(+164%)

64

28+RM37bn(+133%)

5

6

59

12 +RM46bn(+374%)

11

+RM10bn(+600%)

2

1

11

Demerger and streamlining of

focus; regional growth strategy

Regional leadership

Industry reforms

Financial restructuring and

careful regional expansion

Collaboration with private sector

and focus on Iskandar Malaysia

Challenging global operating

environment

18.9%

6.8%

15.9%

9.6%

24.2%

37.1%

(15.6%)-20%

-10%

0%

10%

20%

30%

40%

TM Axiata CIMB TNB MAHB UEM Sunrise

MAS

Total Shareholders’ Return5

RAV (RM bn)

145.5 150.2

50.9

31 Dec 2015

14 May 2004

31 Dec 2014

160

120

80

40

0

+RM99.3bn

+RM4.7bn -RM1.8bnNWA (RM bn)

109.0

33.3

31 Dec 2015

14 May 2004

31 Dec 2014

120

80

40

0

+RM75.7bn

110.7

33.3

24.0

18.7

17.5

13.5 4.8 3.8

(7.3)0.7 109.0

NWA NWA31 Dec 2015

14 May2004

Telco

Healthcare

TNB UEM

GroupCIM

BAlib

aba

Aviatio

nOthers

Co

ntr

ibu

tio

n (

RM

bn

)

2015 Contribution (RM bn)

Total Shareholders’ Returns (in local currency terms)

(0.9) 6.5 (0.2) (0.7) (2.3) (0.1) (2.0) (2.1)(1.6%)

(1.0%)

(11.4%)

(10.5%)

(4.0%)

11.2%

(3.7%)

(2.0%)

(14.1%)

(14.9%)

(9.2%)

(0.3%)

(20%) (15%) (10%) (5%) 0% 5% 10% 15%

Straits Times Index

MSCI Asia ex-Japan

MSCI AC World

MSCI Emerging Markets

SENSEX

Istanbul Index

Philippines Index

Hang Seng Index

Shanghai Index

Jakarta Composite Index

FBM KLCI

NWA Growth

HEALTHCARE17.2%

POWER15.3%

FIG13.7%

PROPERTY10.6% TRANSPORTATION

& LOGISTICS4.9%

INNOVATION &TECHNOLOGY

2.3%

LEISURE & TOURISM

2.0%

SUSTAINABLE DEV.1.3%

OTHERS2.5%

CONSUMER0.7%

AGRIFOOD0.4%

LIFE SCIENCES0.4%

CREATIVE0.3%

EDUCATION0.0%

INFRASTRUCTURE & CONSTRUCTION

3.8%

CASH2.5%

MEDIA & COMMS22.0%

SINGAPORE5.4%

OTHERS2.4%

INDIA1.9%

TURKEY 1.2%

PHILIPPINES1.1%

MIDDLE EAST0.9%INDONESIA

0.3%

MALAYSIA80.9 %

CHINA6.1%

90

140

190

240

290

340

390

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015E

5

10

15

20

25

30

9.97.0

10.5

19.2

14.511.8

17.1

20.6

26.1 26.3 26.224.0

2.7

6.3

11.4

6.3 7.510.4 10.1

13.2 13.5 12.7 13.1

5.2

INDIA4.1%

OTHERS1.5%

SRI LANKA1.5%

BANGLADESH1.4%

NORTH AMERICA

1.3%PHILIPPINES

1.1%

MIDDLE EAST0.8%

EUROPE 0.3%

CAMBODIA0.4%

JAPAN0.2%

THAILAND0.5%

AFRICA0.1%

MALAYSIA55.1%

SINGAPORE12.1%

TURKEY7.4%

CHINA6.5%

INDONESIA5.7%

CAGR4

(p.a.)

K-7 Index 11.1%G20 Index 10.5%FBM KLCI 10.8%

100=14/5/04

May04

May05

May06

May07

May08

May09

May10

May11

May12

May13

May14

May15

G20

K-7

2013

2008 +RM9bn(+782%)

-RM1bn (-12%)

79

30

2013

2004

2013

2004

2013

2004

2013

2004

2013

2004

+RM49bn(+164%)

64

28+RM37bn(+133%)

5

6

59

12 +RM46bn(+374%)

11

+RM10bn(+600%)

2

1

11

Demerger and streamlining of

focus; regional growth strategy

Regional leadership

Industry reforms

Financial restructuring and

careful regional expansion

Collaboration with private sector

and focus on Iskandar Malaysia

Challenging global operating

environment

18.9%

6.8%

15.9%

9.6%

24.2%

37.1%

(15.6%)-20%

-10%

0%

10%

20%

30%

40%

TM Axiata CIMB TNB MAHB UEM Sunrise

MAS

Total Shareholders’ Return5

RAV (RM bn)

145.5 150.2

50.9

31 Dec 2015

14 May 2004

31 Dec 2014

160

120

80

40

0

+RM99.3bn

+RM4.7bn -RM1.8bnNWA (RM bn)

109.0

33.3

31 Dec 2015

14 May 2004

31 Dec 2014

120

80

40

0

+RM75.7bn

110.7

33.3

24.0

18.7

17.5

13.5 4.8 3.8

(7.3)0.7 109.0

NWA NWA31 Dec 2015

14 May2004

Telco

Healthcare

TNB UEM

GroupCIMB

Alibaba

Aviatio

nOthers

Co

ntr

ibu

tio

n (

RM

bn

)

2015 Contribution (RM bn)

Total Shareholders’ Returns (in local currency terms)

(0.9) 6.5 (0.2) (0.7) (2.3) (0.1) (2.0) (2.1)(1.6%)

(1.0%)

(11.4%)

(10.5%)

(4.0%)

11.2%

(3.7%)

(2.0%)

(14.1%)

(14.9%)

(9.2%)

(0.3%)

(20%) (15%) (10%) (5%) 0% 5% 10% 15%

Straits Times Index

MSCI Asia ex-Japan

MSCI AC World

MSCI Emerging Markets

SENSEX

Istanbul Index

Philippines Index

Hang Seng Index

Shanghai Index

Jakarta Composite Index

FBM KLCI

NWA Growth

HEALTHCARE17.2%

POWER15.3%

FIG13.7%

PROPERTY10.6% TRANSPORTATION

& LOGISTICS4.9%

INNOVATION &TECHNOLOGY

2.3%

LEISURE & TOURISM

2.0%

SUSTAINABLE DEV.1.3%

OTHERS2.5%

CONSUMER0.7%

AGRIFOOD0.4%

LIFE SCIENCES0.4%

CREATIVE0.3%

EDUCATION0.0%

INFRASTRUCTURE & CONSTRUCTION

3.8%

CASH2.5%

MEDIA & COMMS22.0%

SINGAPORE5.4%

OTHERS2.4%

INDIA1.9%

TURKEY 1.2%

PHILIPPINES1.1%

MIDDLE EAST0.9%INDONESIA

0.3%

MALAYSIA80.9 %

CHINA6.1%

90

140

190

240

290

340

390

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015E

5

10

15

20

25

30

9.97.0

10.5

19.2

14.511.8

17.1

20.6

26.1 26.3 26.224.0

2.7

6.3

11.4

6.3 7.510.4 10.1

13.2 13.5 12.7 13.1

5.2

INDIA4.1%

OTHERS1.5%

SRI LANKA1.5%

BANGLADESH1.4%

NORTH AMERICA

1.3%PHILIPPINES

1.1%

MIDDLE EAST0.8%

EUROPE 0.3%

CAMBODIA0.4%

JAPAN0.2%

THAILAND0.5%

AFRICA0.1%

MALAYSIA55.1%

SINGAPORE12.1%

TURKEY7.4%

CHINA6.5%

INDONESIA5.7%

1. Based on unaudited numbers as at 31 December 20152. RAV: Market value of all equities, securities and cash held. Where no market price is available, a conservative estimate

of value is used3. NWA: RAV less Total Liabilities and adjusted to measure value created4. Compounded Annual Growth Rate5. In local currency termsSource: Bloomberg; Khazanah analysis

6. An estimate of attributable value according to the countries where investee companies have operations 7. Number of discrete new investments8. TSR comprise capital gains and dividends, net of taxes9. 2015 estimates exclude Malaysia Airlines Berhad (“MAB”) as it is currently undergoing restructuring10. Based on demerger reference priceSource: Bloomberg; companies’ financial reports; analyst consensus estimates for 2015; PCG analysis; Khazanah analysis Source: Khazanah analysis

DECOMPOSITION OF PORTFOLIO NWA MOVEMENT

2015 PERFORMANCE OF PORTFOLIO AGAINST REFERENCE REGIONAL MARKETS

FINANCIAL STATEMENTS HIGHLIGHTS (RM m)

Financial Year ‘04 ‘05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11 ‘12 ‘13 ‘14 ‘151 Cumulative

Profit Before Tax 282 (831) 1,014 5,110 128 791 2,081 5,342 2,077 3,128 3,217 1,176 23,515

Dividends Declared 30 30 100 1,000 100 100 500 3,000 1,000 650 900 1,050 8,460

Taxation 73 126 225 195 350 (25) 28 66 188 (53) 129 136 1,438Shareholders’Funds 13,202 12,244 13,041 17,866 17,139 17,639 21,409 25,625 26,980 29,387 35,340 35,580

RAV by major sectors

RAV by geographic exposure6RAV by domicile of companies

INVESTMENTS DIVESTMENTSNo. of

transactions7Amount (RM bn)

No. of transactions

Proceeds(RM bn)

Gains on Divestments (RM bn)

2004-2014 121 66.0 67 42.8 19.42015 23 8.7 10 5.3 2.9TOTAL 144 74.7 77 48.1 22.3

SELECTED NEW ECONOMY INVESTMENTS (“NEIs”)

ADDITIONAL & ACCELERATED DOMESTIC INVESTMENTS

TOTAL SHAREHOLDERS’ RETURN (“TSR”)8

INTERNATIONAL PRESENCEAGGREGATE EARNINGS (RM bn)9

Key changes to Boards

20052004 2006 2007 2010

GLIC/GLCROLES IN

NE M

Stay the course inexecuting the10 year GLCTProgramme

Pursue neweconomyinvestmentsin line withNEM

Collaborate andco-invest with

privatesector

Relentless drive to become regional champions

Continue focus on core operations: level playing field and exit non-core/ non-competitive assets

12

34

5

1

3

2

4 5

ISKANDAR MALAYSIA

CREATIVE & MEDIA LEISURE & TOURISM WELLNESS

INNOVATION & TECHNOLOGY

Selected international milestones:

Other selected initiatives by KLCs:

TSR of Khazanah Linked Companies (“KLCs”) Since May 2004

• RM187bn cumulative committed investments• 605,381 jobs created from 2007-2014• 3,830 units affordable houses delivered to-date

• Several international productions “Asia’s Got Talent”, “Marco Polo 2” and “Lost in the Pacific”

• 2,123 jobs created since 2014

• Completion of project• Venture into latest

motion capture technology

• Various direct investments made

• Continued progress on Desaru Coast

KLCs Khazanah Europe Investment Limited office established in

London

Investments in Frontier Markets

Graduating to a Higher Class:Nation-Building, Touching Lives

7 - 9 August 2015, Kuala Lumpur Convention Centre

• Strategic stake in GAMA Enerji, Turkey

• 73.4% stake in Global Hospitals, India• 51.0% stake in Continental Hospitals,

India• JV to set up a 350-bed hospital in

Chengdu, China

• 80% stake in NCell, Nepal• 75% stake in Digicel Myanmar Tower

Company

• Completion of Cikopo-Palimanan toll road, Indonesia

TSR (p.a.) 18.1%10 4.9%10 8.5% 9.8% 15.7% 13.7%

Holding period return ("HPR") 595.3%10 44.5%10 158.4% 196.9% 445.6% 150.1%

GLCT Programme Graduation

7 August 2015

RM6.77bnProjects announced in September 2015 in support of the Government’s proactive economic measures:

RM2.5bnKhazanah projects announced in National Budget 2016:

Desaru Coast Destination Resort [RM4.5bn]

In-patient Rehabilitation Hospital Business [RM100m]

i2M Sdn Bhd to provide incentives to attract investments in BPO sector [RM90m]

Tourism Venture Fund [RM50m]

Taman Tugu & Dataran Muzium [RM1.1bn]

Domestic Innovation and Technology [RM115m]

New IHH hospitals and extension of existing hospitals [RM670m]

Sonneratia Capital, a fund tofinance production of local content [RM50m]

Skim Latihan 1Malaysia (“SL1M”) Programme [RM95m]

• Additional fund injection • RM500m NEI Venture Fund

• Development of KLIA Aeropolis and adjacencies [RM7.4bn]

• RM3.4bn investments over the next 10 years in High Speed Broadband 2 (“HSBB2”) and Sub Urban Broadband (“SUBB”)

• Jimah East power station, Negeri Sembilan [RM4.7bn]

• Manjung 4 & 5 power stations, Perak [RM9.6bn]

• Gleneagles Medini, 300 beds [RM502m]• Gleneagles Kuala Lumpur 100-bed expansion

[RM29m] • Further domestic hospital expansions planned

SELECTED INVESTMENTS SELECTED DIVESTMENTS

New investment in an international investment bank

Divested 2% stake (RM1.6bn) via market placement

Additional injection as part of Proactive Economic Measures

Further monetisation via market transactions