First Pacific Company Limited

Good day everyone, thank you for joining us on my briefing to discuss First Pacific 2026, 26 months financial and operating results. The results presentation as usual is available on the First Pacific website, www.firstpacific.com, under the Investor Relations Session presentation page. This last week's results briefing is being recorded and the report will be available on First Pacific website this evening. in the investor relations session. If there's any participant from the media, please note that this session is open for investors and analysts only. If you would like to raise questions, please contact us when the briefing is finished. Today we have with us our CFO, Mr. Joseph Ng, Associate Director, John Ryan, and other senior executives from the head office in Hong Kong. Over to you, John, for the presentation, please.

Thank you much, Sarah. Okay, folks, we're looking at the presentation we posted on our website at lunchtime. And let's begin with a new page three, which lists some of the highlights of the first half results of First Pacific and its operating companies. Our recurring profit, while it was down a little bit from 2025 first half, it was the second highest ever. And that's notwithstanding Icarupia and Fevo. More on that a little bit later. Thanks to the sterling work of our finance and treasury people, Standard & Poor's have upgraded our credit rating to BBB with a stable outlook. Sorry, BBB. And we've got a stable distribution to shareholders with a yield at around 5.4%. And of the five analysts you covered first specifically, they've all got buy or outperform recommendations. Indofood continued its run of record highs with For-profit up 7% to a record high. For the full year, it's Food Division ICBP sees sales going up as much as 7% for the full year, with a strong even margin between 20 and 22%. Interestingly, in the second quarter, as they reported on their own results conference call a couple weeks ago, overseas noodle sales were up 31% in the second quarter. That's an important engine of growth for Indofood. Now, over at Metris Pacific, again, record high core profit driven mostly by Moralco, but growth from other businesses as well. And for the full year, core profits likely to see a fourth record high in a row. Likewise, PLDC has the highest ever first half service revenues and EBITDA with positive free cash flow. Its credit rating is BBB, and it has a very nice dividend yield of 8%. and we'll speak a little bit about their fintech, the Maya Digital Banking Unit, which saw its contribution increase quite a bit in the first half of the year. Over at Pacific Light, that's our LNG-fired power plants in Singapore. Revenues rose 12% and construction has gone underway now on a hydrogen-ready combined cycle gas turbine power plant, which will open about halfway through 2029. Many of you have perhaps some interest in Philex Mining, which is developing a new mine down in the southern island of Mindanao called Salangan with rich reserves of copper and gold. And we've got two board directors of that company here with us today, and they can tell you about that in the Q&A. In the meantime, its older mine, Tad Cal, doubled its contribution to first specific earnings with much higher metal prices, notwithstanding lower volumes of production. Let's skip over two pages to page five with the usual snapshot of the shape of our gross asset value. $4.8 billion, Indofood's just over a third, MPIC just over a quarter, and PLDT just over a fifth with the Philex group of companies. That includes Philex Mining and PXP Energy as well as some notes issued to First Pacific by Halangan. That's just under 10%. And then TLP, you see it's 9% of our gap. And you might have noticed that we have incrementally been increasing its value for a specific. And that's because of the money we are putting in to help finance our share of that new power plant mentioned a moment ago. Okay, let's go one page down. We've got turnover up 6%, not quite a record high. We've seen a little bit higher. Contribution from operations, this is all in U.S. dollars, of course, was down 2%, and that's because of weaker rupiah and peso, which were down by 5% and 6% respectively at an average exchange rate over the first six months of the year. So Indofood and MPIC, however, did deliver their highest ever first half revenues on continuing growth and demand for what they offered to their customers. Now, while our recurring profit was down 3%, it was still the second highest we have ever achieved at First Pacific in our 45-year or so history. The interim distribution to shareholders, a very important measure of our performance, is unchanged at 13 Hong Kong cents per share, notwithstanding the declining contribution and recurring profit. Now, over to the next page where a brief word You've got the credit ratings we have at the top of those bullet points with the increase by S&P to BBB stable outlook. Our interest coverage ratio is 4.8 times at the end of June, well above our comfort level, and gross net debt little changed really from six months earlier. And our blended interest cost about 4.5% with an average maturity of 3.4 years. Now some of you, particularly if you're debt investors, will want to hear what we're going to do about our bond that's maturing next September, so in about 13 months. $350 million blue column there in the column chart. It's a bit less than a quarter of all our borrowings, and we've got the matter well in hand. Now, quick brief look at Indofood. Record highs for net sales and core profits. and the outlook is very strong with ICPP sales being up as much as 7%, EBIT margin at 20 to 22% and very healthy capex at 5.5 trillion rubles over at ICPP and for the rest of India food another 4 trillion. Did I say rubles? Rupiah. Another 4 trillion rupiah. Now on page 9, a quick snapshot of ICBP. Record high net sales and core profit up just a little bit, 1% to 5.4 trillion rupiah, as cost of goods sold rose about 12% in local currency firms. Now, a brief snapshot on page 10, that rising stacked column chart shows you what the biggest contributors to the earnings at Indofood were. and as ever it has been noodles, which just keep growing very, very strongly. As you can see in the blue box on the right, noodles all by themselves constitute a little bit less than half of all sales by value at 46%. Now, let's turn to Metro Pacific on page 13. You see where our almost 50% stake of MPIC makes up 26% of our gross asset value and measured at 1.2 billion US dollars. And as a reminder, that's the valuation of when it was privatized way back in the autumn of 2023, I think it was. Now, if you look at the market caps of the two of its biggest companies, mainland and Morocco, that 1.2 billion dollars looks a little small. Likewise, when you consider that the analysts who cover us and others put a rather higher value on that. I find that personally is very interesting because it implies that our NAV discount is really not what you might think it is if you're using the $1.2 billion. Now, turn to page 14. We can look at the contribution from the main businesses. Now, the three biggest ones, Moralco, Toll Roads, and Manalad, the water company listed in November, all delivered record high revenues and record high core profits. And you can see their contribution to earnings at MPIC in the bottom left chart. The water contribution is down solely because MPIC sold down in the IPO back in November, reducing its economic interest from over 50% to down around about 38%. I won't fill up valuable time going blow by blow with all their operating companies. We can get into them during the Q&A. So let's jump, please, to page 22, where we'll have a quick look at PLDT, where, again, it seems every half year and full year we see another success of record high in service revenues. I've lost count of it, and there's a similar story with the EBITDA over at PLDC where it was up 1% again to a record high. On the full year, these two items are expected again to report consecutive record highs. Now, an important item for us to look at when considering PLDC is on page 23. As you can see, we've got that red line on the top chart on the right-hand side. That's our capex to service revenues and the columns themselves are the money figures for the dollar figures for those capex expenditures. 2022 was the highest ever and as you can see, it has fallen very, very sharply to below 20%. In the first half of 2026, it was 19% of service revenues. And we expect the downward trend will continue. I believe it was in the last quarter of last year that PLDT went positive free cash flow, and that has continued through the first six months of 2026. Turning now to page 25, a brief word about PLDT's fintech, and that's a digital bank called Maya. Maya's contribution to PLDC's profit in the first half of the year was just a bit less than 40% to 559 million pesos versus 406 billion in the first half of 2025. As these various column charts down below show you, the growth over at Maya, whether you're looking at deposit balances or loans outstanding, remains very, very strong. The talk in the local media is that there will be an IPO of this business one day and you can ask about that in the Q&A and I'm sure we won't be able to tell you very much. Now let's turn to page 26, a brief look at PLP, Pacific Light Power, our LNG business, power business in Singapore. As you can see, electricity prices were up a bit in the first half of 2026 from the, you can see on the line chart down But the core profit was down 26%. That's a big decline on the lower non-fuel margin for electricity sold under renewed retail contracts. Very much the future is a big part of the story at PLP, which is building a very large hydrogen-ready power plant, which we expect to be running in commercial operation in about the middle of 2029, as mentioned earlier. Now, over to Philex, a very exciting mining company. Those of you who know me personally know that I'm a big fan of Philex. The Pad Cal mine saw, well, overall the business saw revenues down 9% because of lower tonnage. Frankly, the equipment at the Pad Cal mine, which has been going for over half a century, is getting a little worn out and there are breakages. So there is lower tonnage, lower grades. but the prices for the metals as you can see in the blue box at the bottom right were very very much higher and that resulted in a big increase in core profit of 56%. Now Solanion which is discussed on the following page, page 28, is on track to open commercial mining towards the end of 2026. We are very excited about that and When they settle in and everything's going smoothly, we will get in touch with fund managers to inquire whether they would like to go down and have a look at that mine. As you can see in the top blue box, the grades of copper and gold in that mine are far higher than what we've got at Pad Cao. and we're very excited to see what this will be doing for us going forward. Now let's have a little wrap up on page 29 of my narrative then we can go to some questions. This is a chart on the left hand side rebasing our recurring profit and exchange rates of peso and rupiah to 100 in the year 2020 and how they have changed over time. As you can see, the peso was down 18% in the, what, five and a half years since then, and the rupee had down 15%. That's through to the June 30 exchange rates. While those are down by those percentage points, you can see our recurring profit has risen enormously. And we expect fully for this sort of situation to continue, that mismatch between exchange rates and our US dollar profit number, because the IMS and many others expect that the size of the economies of our two main markets will be doubling over the course of a 10-year period from 2020 to 2030. That line chart there is from the IMF's October World Economic Outlook, and we'll update it in a couple of months with the new one. So that's a snapshot of where we've been in the first six months of the year. Executive Director Chris Young has joined us, eager to respond to the questions that you're going to ask. Sarah.

Yeah, thanks John. We are now ready for questions. Oh, Jeff has the first one. Jeff, please go ahead.