company briefing : magtaainvestors.hyflux.com/newsroom/20080422_173918_600_78bb08...magtaa project...

COMPANY BRIEFING : MAGTAA

Sam OngGroup Deputy CEO Group CFO

SingaporeTuesday, 22 April 2008

OUTLINE

1.Magtaa Project Win Information

2. Impact on Financials

3.Hyflux’s Water Strategy

4. Souk Tleta (Tlemcen) Update

5. Summary

MAGTAA PROJECT BID

Capacity

EPC Value

Offtakers

Concession Period

Project Company

500,000 m3/day

approximately US$500 mil

L’Algerienne Des Eaux(“ADE”)

25 years

51% MenaSpring49% Algeria Energy Company

Other Bidders(International Open Bidding)

Acciona Agua, Biwater/Tarco/Arcofina, GE

Water/Orascom, Inima/aqualia, Befasa

MAGTAA PROJECT HEADLIMES : GWI

“This brings Hyflux to the top of the desalination market, and that is the position we want to be in. In this bid for Magtaa, I believe we further

established a performance and cost ratio benchmark on top of what we were able to establish in Singapore.”

-Sam Ong, Group Deputy CEO and CFO

“A stunning [international open competitive] bid for the 500,000m3/day

Magtaa desalination plant in Algeria has put Hyflux on the brink of

big-time success …”

-Global Water Intelligence, April 2008

OUTLINE





5. Summary

• Hyflux 51% AEC 49% • WPA 25 years concession• Capacity 500,000 m3 / year• Pcod 28 mths from financial close

• Project Financing 70% -- prearranged by AEC-- predetermined 15-year USD fixed

• VAT and custom duty Incentives

• EPC 100% Hyflux• O&M 100% Hyflux

THE PROJECT

Magtaa

MenaSpring AEC

49%51%

Hyflux Ltd

100%

Sonatrach / ADE

WPAHyflux On / Offshore

EPC +

Hyflux Ltd

100%

O&M

Hyflux Investments of S$80mil

• Equity Income• Dividend• Equity Repatriation

Financial Incentives• Project Financing • Take or Pay • Electricity rates• Vat & Custom duty Incentives

EPC + O&M• EPC Revenue of S$600mil from

2009 to 2011 expected.• O&M Revenue of S$60mil recurring

annually with costs escalation clauses

THE INVESTMENT

Magtaa

MenaSpring AEC

49%51%

Hyflux Ltd

100%

Sonatrach / ADE

WPAHyflux On / Offshore

EPC +

Hyflux Ltd

100%

O&M

China

81%

SG

7%

OTH

12%

SG

26%

OTH

18%

China

56%

China

71%

SG

21%

OTH

8%

Note : Graph is not drawn to scale.

HYFLUX : Growing China in A Growing Pie

FY2007 act

FY2006 actFY2005 act

China

81%

SG

7%

MENA

12% China

58%

MENA

40%

China

50%

MENA

49%

Note : Graph is not drawn to scale. This is a snapshot and the numbers may change in accordance to delivery schedules and potential future orders.

HYFLUX : Growing Algeria within MENA in A Growing Pie

FY 2008 est

FY 2009 est

FY 2007 act

435870

~1500

4Q06 4Q07 April 2008 Est

HYFLUX : Order Book with MAGTAA

S$mil

Note : The net order book is a snapshot estimated figure as of 22 April 2008. There are additions and deletions YTD esp in China.

OUTLINE





5. Summary

HYFLUX’S WATER STRATEGY:Sustainable Global Presence in Desalination

Membrane (proprietary strength …)Largest UF pretreatment plant in the world.

Location (not a one time deal …)

High water scarcity with

comprehensive PPP schemes.

Desalination (fastest growing …) Largest membrane seawater desalination plant in Singapore, China, Algeria and the world.

ChinaTianjin Dagang

150,000m3/day, US$100 MIL2008

AlgeriaMagtaa

500,000m3/day, ~US$500 MIL

2011

AlgeriaSouk Tleta (Tlemcen)

200,000m3/day, US$200 MIL2009

SingaporeSingSpring

136,380m3/day, US$200 MIL2005

HYFLUX’S WATER STRATEGY:Favorable Commercial & Technological Forces in Desalination

Projected Growth of Installed Desalination Capacity (Gulf vs Rest of World)

China

India

Algeria

HYFLUX’S WATER STRATEGY:Sustainable Risk & Reward PPP with High Water Scarcity

Algeria is one the most water-stressed countries in the world, which presents huge opportunities for

seawater desalination and water recycling.

Highest concentration of large-scale membrane seawater desalination plants in the world

HYFLUX’S WATER STRATEGY:Value Added Breakthrough Performance / Costs Benchmark

0

0.5

1

1.5

2

2.5

1991-2000 2001-2005 2006-2010 2011-2015

Historic and Forecast Capacity Growth in Algeria

Algeria Market Share (awarded capacity)

Hyflux,32%

Others, 68%

Capacity, million m

3/day

Source: Desalination Markets 2007, GWI

*equivalent of 4 additional Magtaasneeded in 2011-2015

HYFLUX’S WATER STRATEGY:Sustainable Growth Within A Plant … Within A Country.

to be launched end 2008 BEJAIA --100,00014

to be launched end 2008JIJEL --100,00013

2,370,000

50,000

100,000

200,000

500,000

120,000

100,000

200,000

200,000

200,000

200,000

100,000

200,000

CAPACITY(m3/day)

2.521 BILTOTAL

INIMA-AQUALIA, AECEL TARF -91 MIL12

BIWATER, AECOUED SEBT -115 MIL11

BEFASA, AECTENES -291 MIL10

DEC 2009136 MILINIMA-AQUALIA-SPA SPAIN, AEC

RAS DJINET7

HONAINE

MOSTAGANEM

SKIKDA

DEC 2011468 MILHYFLUX, AECMAGTAA9

DEC 2009181 MILSNC LAVALIN-ACCIONA SPAIN, AEC

FOUKA8

DEC 2009238 MILHYFLUX, AECSOUK TLETA6

NOV 2009230 MILGEIDA SPAIN, AEC5

NOV 2009212 MILINIMA-AQUALIA-SPA SPAIN, AEC

4

SEP 2008204 MILGEIDA SPAIN, AECBENI SAF3

FEB 2008105 MILGEIDA SPAIN, AEC2

JAN 2008250 MILGE IONICS, AECHAMMA1

EXPECTED PCOD

PROJECT VALUE (US$)

PROJECT COMPANYPLANTNO

HYFLUX’S WATER STRATEGY

COMPANY BRIEFING : MAGTAA



HYFLUX’S WATER STRATEGY: Value Add Technology & Knowhow of an Integrated Water Company

0

10

20

30

40

50

60

70

1980 1985 1990 1995 2000 2005 2010 2015

Capacity, millions of m3/day Membrane

Thermal

Historic and Forecast Installed Desalination Capacity by Technology

Source: Desalination Markets 2007, GWI

Drivers for Membranes• improvements in membrane efficiency• reduction in membrane cost• development of energy recovery devices

• Inhouse Design & Engineering capability• Inhouse UF pretreatment membranes• Inhouse Membrane R&D capability

OUTLINE





5. Summary

SOUK TLETA (TLEMCEN) UPDATE : Focusing on Execution

EPCProgress

• Construction started in Feb 2008• 6% of EPC contract completed• 2 weeks ahead of time

OUTLINE





5. Summary

Incremental Capacity : Certainty of Financial Visibility

950

Built Capacity

950

450

Built Capacity

Singapore, China,

India & MENA

China +

1st Algeria Start

550

China +

1st Algeria End +

2nd Algeria Start

Accum. Capacity

1,950

500

2,450

Total Capacity Built

+ To Be Built

2001 to 2007 2008 2009 2010 and 2011

China Order Bk Completed +

2nd Algeria End

Accum. Capacity

1,400

Future

BOT

Growth

TBA

Note : Graph is not drawn to scale. This is a snapshot and the numbers may change in accordance to delivery schedules and potential future orders.

Snapshot Summary excludes TOT and

Existing Plant Expansions to be announced.

Capacity : mil litre / day (mld)

• The Magtaa Win

• Hyflux the World Leader in

Desalination & Water Recycling

• Sustainable Strategy

• Sustainable Business Model

• Smart Execution

SUMMARY : MAGTAA

THANK YOU



company briefing : magtaainvestors.hyflux.com/newsroom/20080422_173918_600_78bb08...magtaa project...

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