Beyond Food Zen Corporation Group Public Company Limited - PowerPoint PPT Presentation

Experience Beyond Food Zen Corporation Group Public Company Limited Opportunity Day 19 March 2019

Agenda 1. Company Overview and Strategy 2. 2018 Performance 2

Agenda 1 Company Overview and Strategy

Key Milestones Public conversion of February 2019 ZEN as a preparation Acquisition of Sushi Cyu for IPO Establish Zen Supply Chain Management 2019 1 st Tetsu 2018 restaurant 2017 2016 1 st On the Table restaurant 2015 2014 2011 1 st Khiang restaurant 2009 1 st ZEN 1 st Musha restaurant restaurant 2007 Acquisition of “Tummour Chained Group” Incorporation of ZEN as holding company 1991 1 st AKA Business restructuring subsidiaries restaurant 4

Business Group Structure and Revenue Structure Business Groups Revenue Structure I. Restaurant Franchise Business Fees, Delivery and 2.3% Retail, 0.7% Restaurant, Franchise, 90.1% 7.7% II. Franchise Business Other Income, 1.4% Sales Raw III. Other Food Related Business Material, 5.4% • Retail Products • Delivery & Catering • Restaurant Management and Restaurant Consultancy 5

Well-Diversified Brands in the Portfolio with Outlets Across Thailand & ASEAN Region High Income 2 4 137 110 2 Student / Family T eenager Working Age ▪ As of 31 December 2018, ZEN Group has a total of 255 outlets (110 equity and 145 franchise outlets) under 12 brands in its portfolio ▪ With strong brands visibility and outlets coverage, the ZEN Group can target various customers groups, from teenager and working age to family group, and from low to high income group 6 Low Income

Restaurant Outlets as at Dec 2018 Company Owned Franchise Total Type of Brand Business Outlets Thailand Thailand Laos Myanmar Cambodia - - - - Japanese 1. ZEN 43 43 Restaurants - - - 2. AKA 17 1 18 - - - 3. On the Table 18 1 19 - - - - 4. Tetsu 1 1 - - - - 5. Sushi Cyu 3 3 - - - - 6. Musha 4 4 Thai 7. Tummour 13 102 1 1 1 118 Restaurants - - - 8. LaoYuan 6 18 24 - - 9. Jaewhon 4 8 1 13 - - 10. Pho 8 - 2 10 - - - - 11. De Tummour 1 1 12. Khiang 1 1 Total 110 137 2 4 2 255 7

Our Brands Still Have Large Opportunity to Grow Thailand Food Market Will Support Expansion Number of Outlets by Brand Food Service Industry Size CAGR +4.7% 1,055,076 Unit: outlets ~700 836,998 308 50,842 CAGR +11.7% 235 219,438 CAGR +4.5% 29,181 ~400 176,361 309,806 ~330 252,617 ~250 138,326 ~170 105,963 116 ~90 CAGR +4.3% 336,355 43 272,641 24 18 17 2017 2022 Kiosk and Street Stalls Fast Food Café and Bars Full Service Note: 1. Data of compared peer are from 2017 company’s 56 -1, ZEN, and Q3 Result Presentation 2. Include only domestic outlets Delivery Self Service Source: Euromonitor International 8

Key Focus 2019 Number of Branches • Open 36 new branches in 2019 Restaurant • Continue positive SSSG Business • Increase operational efficiency 232 +87 145 127 • Open 87 new branches in 2019 Franchise • 37 standard size locations 146 +36 Business 110 102 • 50 micro-franchise locations 2017 2018 2019 Equity Branch Franchise Branch • Expansion of retail business with Other Investment CAPEX THB Mn new products and channels Business • New call center to drive delivery Investment in New Equity Branch 170 business Investment in Renovation Branch 45 Investment in IT POS 20 Other Investment 50 Total Investment 285 9

Agenda 2 2018 Performance

Notable Recent Events ➢ Dec 2017 Open new quick service value for money Japanese brand “ Musha ” ➢ Mar 2018 Improve supply chain quality by outsourcing ➢ Aug 2018 Achieve membership of Thailand Private Sector Collective Action Coalition Against Corruption ➢ Dec 2018 Open new quick service Thai street food brand “ Khiang ” ➢ Feb 2019 Zen Corporation Group registered on Stock Exchange of Thailand (SET) 11

Marketing Strategy 4Q18 – Zen and AKA 12

Marketing Strategy in 4Q18 – OTT and Tummour 13

Start Focus Delivery in 2018 14

Annual Total Revenue and Net Profit THB Million Total Revenue Net Profit 5.6% YoY Growth +5.1% +11.0% +15.3% +17.9% 160 6% 4.7% 4.1% 2,965 140 3.3% 140 4% 2,515 120 2,182 110 100 2% 1,966 90 80 82 0% 60 40 -2% 20 0 -4% 2015 2016 2017 2018 2015 2016 2017 2018 Branch Expansion Revenue Net Profit Opened 42 new branches in 2018, Total revenue increased by 18% Net profit of 140.2Mn, growth of led by Thai brands under franchise YoY, driven by both restaurant and 71% YoY. Net margin improved model franchise businesses from 3.3% to 4.7% 15

Quarterly Revenue and Net Profit 4Q18 sales slower growth when compared to 4Q17 which had government stimulus. This also affected the net profit growth THB Million Total Revenue Net Profit YoY% +23.6% +24.3% +18.1% +7.2% YOY +17.9% YoY% +47.9% +334.3% +70.6% -3.4% YOY +71.4% 6.2% 3,500 5.0% 4.7% 4.3% 140 3.4% 2,965 5% 3.3% 3,000 140 120 2,515 2,500 0% 100 2,000 80 82 -5% 1,500 60 47 38 753 757 738 32 1,000 716 40 24 -10% 500 20 0 0 -15% 1Q18 2Q18 3Q18 4Q18 FY2017 FY2018 1Q18 2Q18 3Q18 4Q18 FY2017 FY2018 16

Same Store Sales Growth In year 2018, ZEN Same Store Sales Growth was 4.7% compared to previous year. • Because of strong promotion, ZEN got high SSSG in 1Q18. • After Royal Cremation in Oct 2017, • SSSG in 2Q18 and 3Q18 slowdown due to high competition Thailand consumer confidence recovers. • 4Q18 SSSG negative when compared 4Q17 which benefit from government • Our branches in prime area started to be stimulus robust again. 12.5% 12% 10% 7.7% 8% 6.5% 6% 4.7% 4.2% 4.0% 3.9% 4% 2.7% 1.5% 2% 0% -2% -2.3% -4% 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 FY2017 FY2018 17

Revenue from Main Businesses and Gross Profit THB Million Restaurants Revenue Franchise Fee and Merchandise Sales New Business Revenue YOY +15.8% YOY +187.5% YOY +38.4% 2,673 2,309 229 21 166 7 FY2017 FY2018 FY2017 FY2018 FY2017 FY2018 Revenue from Main Businesses Gross Profit 24.6% (1) YoY% +24.6% +21.4% +18.5% +8.0% YOY +17.8% 24.5% 24.3% 24.3% 24.0% 23.6% 900 24% 2,922 800 24.1% 23% 700 2,482 22% 704 600 21% 603 500 20% 400 19% 751 729 711 731 300 184 177 171 18% 172 200 17% 100 16% 0 15% 1Q18 2Q18 3Q18 4Q18 FY2017 FY2018 1Q18 2Q18 3Q18 4Q18 FY2017 FY2018 (1) Excluding WH service fee which started Mar 2018 (Jap Food) and Oct 2018 (Thai Food) and therefore did not apply 2017 18 Note for comparison with peers and consider only Raw Material Expense the gross profit margin FY18 was 64.6%

SG&A Expenses In year 2018, SG&A increased 7.3% (c.f. revenue growth 17.9%) compared to the prior year primarily due to the increase of staff and benefit expenses to support the future business expansion and increased marketing expenses. SG&A Expenses Breakdown SG&A YoY% +18.7% +7.3% +2.6% +1.9% YOY +7.3% Finance 800 23% 21.3% 20.4% Exp., 4% 19.3% 700 21% 19.1% Others, 19.0% 18.9% 15% 600 19% Depreciation, 574 500 17% 5% 535 400 15% Staff & Rent and Benefit, Utilities, 300 13% 55% 4% 146 143 143 200 11% 141 100 9% Marketing, 0 7% 17% 1Q18 2Q18 3Q18 4Q18 FY2017 FY2018 19

Financial Ratios Improve in 2018 Liquidity Ratios to Greatly Improve after IPO Current Ratio ROA (%) 0.32 8.9% 0.27 5.4% 2017 2018 2017 2018 Debt to Equity ROE (%) 3.35 2,500 3.50 3.00 2,000 2.34 2.50 1,500 1,223 2.00 1,095 1.50 1,000 33.6% 1.00 25.8% 469 366 500 0.50 0 0.00 2017 2018 2017 2018 Liabilities Equity D/E Ratio 20

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