AAPICO HITECH PLC [AH] Q3 2017 Performance & Business Update - PowerPoint PPT Presentation

AAPICO HITECH PLC [AH] Q3 2017 Performance & Business Update Opportunity Day The Stock Exchange of Thailand December 4, 2017

Today ’ s Agenda 1. Company Information 2. Thailand Automotive Industry Update 3. Financial Performance 4. Strategy & Direction 2

Company Information

AAPICO HITECH PLC [AH] AAPICO HITECH PUBLIC COMPANY LIMITED Established in 1996 and listed on SET in 2002. • Main businesses: OEM Auto Parts, Jigs and Dies, • Car Dealerships and Car Navigation. Main locations: Thailand, Malaysia and China. Industry/Sector : Auto • Current price : Baht 36.25* 52 weeks range : Baht 13.30 – 38.25 Comprising of 37 companies (27 subsidiaries and • Market Cap : Baht 11,694 million 10 associates). P/E (YTD) : 12.41* P/BV : 1.74* Registered and paid-up capital of Baht 322.58 • Dividend yield : 1.83%** million, comprised of 322,583,844 ordinary shares TRIS / CG Rating : BBB+ / at par value of Baht 1 each. * Data as of November 30, 2017 ** Dividend yield is calculated based on current share price 4

AH Shareholding Structure AH’s main shareholders are Yeap Swee Chuan and Market Capitalization family holding 38.24% of total capital and Sojitz Corporation holding 15.76% of total capital. Sojitz Corp. +148% 15.76% AH; 1.86% 11,694 Yeap Family NVDR; 9.25% 38.24% Institution - Foreign 2.34% Individual - 5,161 Institution - Thai 4,710 4,452 Thai 7.25% 3,387 25.20% Individual - Foreign AH Shareholding Structure 0.09% 2013 2014 2015 2016 2017* Data from Share Register Book as of *Based on share price as of November 30, 2017 August 31, 2017 5

AH Share Price since Jan 1, 2017 AH Share price (in Baht) 42.00 37.75 37.00 +127% 32.00 25.50 27.00 Q3 2017 Results Announcement Q1 2017 Results 22.00 FY2016 Results Announcement Announcement Q2 2017 Results 20.10 Announcement 17.00 JV Sakthi 16.50 Announcement 16.00 12.00 12/16 1/17 2/17 3/17 4/17 5/17 6/17 7/17 8/17 9/17 10/17 11/17 6

AH Board of Directors Mr. Yeap Swee Chuan Mr. John Parker Mrs. Teo Lee Ngo Mr. Pipat R. Punya Present & CEO Independent Director Executive Director Independent Director Executive Director Chairman of Risk Committee Chairman of Audit Committee Lawyer Ex Chairman of Ford Asia Pacific Mr. Kenneth Ng Mr. Kai Taraporevala Mr. Wichian Mektrakarn Mrs. Vachira Na Ranong Independent Director Independent Director Independent Director Independent Director Audit Committee Audit Committee Audit Committee Risk Committee Ex ING Head of Research Ex President of TATA Capital Ex CEO of AIS Chairman of TIA 7

AAPICO’s Vision Where do we want to go? How do we want people to remember us? TO BECOME A MANUFACTURING LEAN , GREEN, HAPPY , DIGITAL RESEARCH & DEVELOPMENT WORLD-CLASS CORPORATION CAR RETAILING AAPICO Key Fundamental Values Happy Customers Happy Employees Happy Shareholders Happy Public • S : Safety • Teamwork • Profitability • Corporate Social • Q : Quality • Look at problems as • Reasonable Dividend Responsibility • C : Cost opportunities • D : Delivery • Love Family, Company • E : Engineering and Country • M : Management • Loyalty and Honesty • Mutual Respect (Focus Digital) 8

Business Segments Car Dealerships Manufacture of Auto Parts Technology (Thailand & China) (Thailand) (Thailand & Malaysia) Stamping & Assemblies Thailand Forging & Machining Malaysia Plastic Jigs and Dies <1% of total ~63% of total revenue ~37% of total revenue revenue 9

Countries of Operations THAILAND Sales by Country Ayutthaya, Chonburi, Rayong, Samutprakarn CHINA Amata Nakorn Industrial Estate Kunshan Hitech Industrial Estate Production: Stamping & Chassis Frames Production: Stamping parts Production: Connecting rods and Forging & Machining Parts and Stamping Dies & Jigs and Copper Forging China 4% Malaysia Bangpli Industrial Estate 24% Production: Plastic Parts Jan-Sep 2017 Amata City Industrial Estate Thailand Production: Stamping Parts Plastic Washers & Fuel Tanks 72% Mitsubishi Dealers Navanakorn & Ramindra MALAYSIA Ford Dealers Kajang & Petaling Jaya Samutprakarn & Ladprao Car dealers: Honda car 10

OEM Customers Top OEM Customer Profile Others- Parts 22% Isuzu 40% Jan-Sep TOYOTA 3% 2017 AAM 4% GKN 4% Nissan AAT* FORD 7% 16% 4% *Auto Alliance (Thailand) Co., Ltd – a JV between Ford and Mazda. 11

Our Partners Joint Ventures Strategic Partner Technical Partners 12

Sakthi Product Range Sakthi Automotive products are specialized in safety and critical components. 13

Thailand Automotive Industry Update

Thailand Car Production Volume Total Car Production by Quarter Jan-Sep Car Production Pick-Up/PPV Passenger Others Domestic Sales Export Sales +0.7% +9.0% yoy ‘ 000 Units yoy 1,477 1,478 600 527 507 487 483 486 468 465 500 612 618 188 214 400 200 207 219 191 192 300 200 312 837 842 302 276 271 266 264 254 100 - 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 9M16 9M17 Q3 2017 Total car production volume grew by 9.0% year-on-year, driven by increased export volume and domestic sales. Source: The Federation of Thai Industry (Automotive Industry) 15

Domestic Car Sales Volume Domestic Car Sales by Quarter Jan-Sep Domestic Sales 1-Ton Pick-Up/PPV Passenger cars Other vehicles +11.5% +12.2% yoy ‘ 000 Units yoy 300 621 557 73 212 210 211 199 70 187 188 182 200 25 23 25 24 245 23 23 24 204 76 80 83 81 58 71 75 100 303 283 111 107 99 102 93 94 90 - 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 9M16 9M17 Q3 2017 Domestic sales grew by 12.2% year-on-year, driven by recovering economy, increased spending, new models and motor show. Source: The Federation of Thai Industry (Automotive Industry) 16

Export Volume Export Volume by Quarter Jan-Sep Export Volume Export Volume -5.6% +2.5% yoy ‘ 000 Units yoy 400 901 850 314 308 306 287 288 284 300 252 200 100 - 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 9M16 9M17 Q3 2017 Export volume grew year-on-year by 2.5%, driven by increased volume in almost all markets. Source: The Federation of Thai Industry (Automotive Industry) 17

Financial Performance January – September 2017

Financial Highlights Q3 Q3 Q3 2017 Results In Million Baht 2016 2017 Revenues 3,619 4,284  Solid revenue growth, driven by auto industry Growth% -1.4% +18.4% growth in TH and CN, good car sales in MY, and THB 86 million interest income from SGAH. Gross Profit 182 202 GP Margin (%) 5.2% 5.0%  Gross profit margin below last year, mainly due to rebate to customer for new project and lower SG&A 189 252 margins in the car dealerships. Associate 75 118  SG&A expenses included unrealized FX loss. Interest & Tax 41 53  Finance costs increased due to loan to finance SGAH Net Profit 132 248 investment. NP Margin (%) 3.7% 5.8%  Higher share of profit from associates , mainly from ROE (%) 8.4% 14.7% Hyundai and Able Sanoh. ROA (%) 4.4% 7.3%  Net profit margin improved yoy to 5.8% of sales, hence improving ROE and ROA. D/E (x) 0.46 0.78 19

AAPICO Group : Total Revenues Total Revenues by quarter Jan-Sep Revenues Auto parts Car dealers Non-op income 18.4% 8.2% yoy yoy THB million 6,000 12,133 11,208 5,000 4,284 3,946 3,910 3,929 3,903 3,681 3,619 4,000 3,000 2,000 1,000 - 9M2016 9M2017 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Non-op income 2%  Q3 2017 : Revenue grew 18.4% yoy, driven by higher auto part sales in Car TH and CN, in line with industry trend, and good car sales in MY. Q3 dealers revenue included THB 86 million interest from loan to SGAH. 36% 9M17 Auto  Jan-Sep 2017 : Revenue grew 8.2% yoy, mainly driven by THB 147 gain parts 62% from sale of investments and THB 107 million of interest from loan to SGAH. 20

Auto Parts : Sales & EBIT Sales and EBIT by quarter Jan-Sep Sales & EBIT Thailand China EBIT% 16.6% 3.4% yoy yoy THB million 5,000 8.3% 5.5% 5.5% 5.0% 4.9% 4.8% 3.7% 3.5% 2.7% 4,000 7,267 7,027 3,000 2,000 1,000 - 9M2016 9M2017 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17  Q3 2017 : Revenue grew 16.6% yoy, driven by growth in both China and CN 6% Thailand, in line with industry trend. EBIT was impacted by rebate to customer for new project. 9M17  Jan-Sep 2017 : Revenue grew 3.4% yoy, driven by higher sales in both Thailand and China. EBIT margin improved from 4.8% in Jan-Sep 2016 TH 94% to 5.5% of sales. 21

Car Dealers : Sales & EBIT Sales and EBIT by quarter Jan-Sep Sales & EBIT Thailand Malaysia EBIT% 13.5% 9.3% yoy yoy THB million 3,000 2.3% 2.1% 2.2% 1.8% 1.9% 1.3% 1.3% 1.3% 1.2% 4,234 3,874 2,000 1,000 - 9M2016 9M2017 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17  Q3 2017 : Revenue grew 13.5% yoy, driven by good car sales in both Malaysia and Thailand, attributable to new model introduction. EBIT TH was impacted by increased competition. 33% 9M17 MY  Jan-Sep 2017 : Revenue growth was driven mainly by good car sales in 67% Malaysia. EBIT margin dropped from 2.1% in Jan-Sep 2016 to 1.3% of sales. 22