Oishi Group Opportunity Day Q2/2019 For the period of Jan-Mar 2019 June 14, 2019 1
Disclaimer • This presentation may include information which is forward-looking in nature. Forward-looking information involve known and unknown risks, uncertainties and other factors which may impact on the actual outcomes, including economic conditions in the markets in which Oishi Group Public Compan y Limited and its Subsidiaries (“OISHI”) operate and general achievement of OISHI business forecasts, which will cause the actual results, performance or achievements of OISHI to differ, perhaps materially, from the results, performance or achievements expressed or implied in this presentation. • The information in this presentation has not been independently verified. No representation, warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information and opinions in this presentation. None of the OISHI or any of its agents or advisors or any of their respective affiliates, advisors or representatives, shall have any liability (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with this presentation. • This presentation and all other information, materials or documents provided in connection therewith, shall not, either in whole or in part be reproduced or recirculated with out written consent from OISHI, save in strict compliance with all applicable laws. 2
Agenda Overview of Oishi Group and Financial Performances Beverage Business Food Business Strategy & Outlook 3
A Member of One of the Largest Thai Conglomerates Industry Key Entities Descriptions / Business Scopes Industrial Trading, • One of ASEAN’s leading multi -format retail Consumer Products and platforms and hypermarket operators • Packaging supply chain and consumer products Retailers • One of the largest F&B group of companies in Food & Beverages ASEAN and leading F&B player in Asia. • Interests in a wide spectrum of residential, Real Estate hotel, hospitality, commercial, retail and industrial units • Provides general assurance, life assurance and Insurance & Leasing car leasing services • Engaged in agro-plantation & technology, sugar Agricultural and food processing 4
Overview of Oishi Group Products Beverage All restaurants of the 2017 Company received GMP, HACCP and ISO 9001:2015 certificates Owned brands 2014 Opened the first restaurant overseas, Shabushi OEM restaurant in Myanmar 2013 • Opened new Central Kitchen at Ban-Bueng district, Saraburi province, • Launched Packaged Food business started with Gyoza and Sandwich 2008 Thai Beverage PCL became Food Oishi’s major shareholder 2004 Started trading in the Stock Exchange of Thailand Packaged Food “Oishi Green Tea” was 2003 Restaurant launched 2002 Started Japanese buffet shabu in kaiten style under the brand “ Shabushi ” Started Japanese 1999 restaurant operation under the brand “Oishi” 5
Key Events in the Past • Sep 2017 Excise Tax and Sugar Tax are imposed on Ready-to-drink Tea (RTD Tea) Category • Nov 2017 Increase in Retailed Price of Green tea across all products as a result of Excise Tax • Fire incident at Navanakorn which impacted UHT Beverage capacity • Dec 2017 Revisit menu offerings and price adjustments for “Oishi Grand” from THB895 net to THB995 net • Mar 2018 Launched 350ml PET at THB15/bottle in traditional trade channel to fill in the gap of price structure • July 2018 Completed partial bond repurchase of THB 299.3 mn due to the company’s abundant of cash liquidity • Oct 2018 Relaunched Core Flavour, Oishi Green Tea Honey Lemon with Hyakkamitsu Honey and Launched new flavor, Honey Double Lemon with Hyakkamitsu Honey • Dec 2018 Launched Oishi Gold, premium tea • Resumption of UHT Beverage Capacity at Navanakorn • Repayment of matured bond amounted THB700.7 mn 6
Financial Snapshots: 2Q19 and YTD19 Quarter (Jan – Mar) YTD (Oct – Mar) (THB mn) 2Q19 2Q18 % Change YTD19 YTD18 % Change Revenue Beverage 1,684 1,516 +11.1% 3,303 3,058 +8.0% Food 1,798 1,607 +11.9% 3,546 3,223 +10.0% Total 3,482 3,122 +11.5% 6,849 6,281 +9.0% Net Profit Beverage 275 185 +48.6% 489 415 17.8% Food 122 59 +106.8% 234 125 87.2% Total 397 244 +62.7% 723 540 33.9% 2Q19’s total revenue increased 11.5% YoY as a contribution of revenue growth from both beverage and food businesses while 2Q19’s net profit increased strongly at 62.7% mainly due to better operational efficiency and expense management. (THB mn) Mar-19 Sep-18 % Change Balance Sheet Items Total Asset 9,267 9,680 -4.3% Interest-bearing debt 1,000 1,701 -41.2% Total Liabilities 2,906 3,690 -21.3% Total Equity 6,361 5,990 +6.2% Bond of THB 1,000 mn as of Mar’19 maturing on 6 July 2019, interest rate 2.20% per annum 7
Financial Performances: Beverage Revenue THB mn 7,085 7,054 • Beverage revenue in 2Q19 8,000 5,986 increased strongly by 11.1% YoY 7,000 6,000 • Revenue increased mainly due to 5,000 successful of summer campaign 4,000 and resumption of UHT capacity in 1,516 1,715 1,213 1,618 1,684 3,000 Dec-18 which was previously 2,000 affected by the fire incident 1,000 0 2016 2017 2018 2Q18 3Q18 4Q18 1Q19 2Q19 Net Profit and Margin THB mn • Beverage net profit in 2Q19 18.1% 17.5% 16.3% improved significantly by 48.6% 14.2% 13.2% 12.9% 12.2% 2,600 YoY 3.9% 14.0% 2,100 • Profit increased thanks to revenue 4.0% 1,004 1,233 1,600 growth and lower selling expense. -6.0% 772 1,100 The company implemented a plan -16.0% 310 275 214 185 600 47 to control marketing spending and -26.0% utilize it in the most efficient way 100 -36.0% to generate revenue for the 2016 2017 2018 2Q18 3Q18 4Q18 1Q19 2Q19 -400 -46.0% business 8
Financial Performances: Food Revenue THB mn • Food revenue increased by 11.9% 6,552 6,497 6,610 7,000 YoY in 2Q19 6,000 • Increased in revenue YoY are as a 5,000 result of new outlets opening and 4,000 positive SSSG (+5.6%) in the 1,607 1,630 1,757 1,748 1,798 3,000 quarter 2,000 1,000 0 2016 2017 2018 2Q18 3Q18 4Q18 1Q19 2Q19 Normalized Net Profit and Margin THB mn • Net profit of food business 7.4% increased significantly at 106.8% 6.8% 6.4% 1,000 10.0% 4.3% YoY in 2Q19 900 3.7% 8.0% 3.2% 2.0% 1.8% 800 6.0% 700 4.0% • Profit increase significantly YoY 600 2.0% 500 287* 0.0% thanks to both increase in revenue 210 400 -2.0% 129 119 122 112 and improvement in efficiency 300 -4.0% 59 33* 200 -6.0% management of the restaurant 100 -8.0% 0 -10.0% business 2016 2017 2018 2Q18 3Q18 4Q18 1Q19 2Q19 Note: * Normalized net profit with non-recurring item adjustment 9
Better Profitability Ratios Net Margin (%) Gross Margin (%) EBITDA Margin (%) 36.0% 35.9% 40.0% 40.0% 40.0% 35.0% 35.0% 35.0% 30.0% 30.0% 30.0% 18.5% 25.0% 25.0% 25.0% 15.7% 20.0% 20.0% 20.0% 11.4% 15.0% 15.0% 15.0% 7.8% 10.0% 10.0% 10.0% 5.0% 5.0% 5.0% 0.0% 0.0% 0.0% 2Q18 2Q19 2Q18 2Q19 2Q18 2Q19 ROA* (%) ROE* (%) 30.0% 30.0% 22.7% 25.0% 25.0% 19.0% 15.6% 20.0% 20.0% 11.3% 15.0% 15.0% 10.0% 10.0% 5.0% 5.0% 0.0% 0.0% YTD18 YTD19 YTD18 YTD19 10 Note: *Annualized Ratio
Strong Financial Status Current Ratio (x) D/E and Net D/E Ratios (x) D/E Net D/E 1.4 1.4 1.2 1.2 1.2 1.0 1.0 1.0 0.8 0.8 0.6 0.6 0.4 0.4 0.4 0.2 0.2 0.1 0.2 0.0 0.0 0.0 Mar-18 Mar-19 Mar-18 Mar-19 11
Higher Interim Dividend for 1H19 THB / share 3.40 2.80 2.50 2.00 2.30 1.60 1.90 1.40 1.30 22.2% YoY 1.45 1.05 1.00 1.10 1.10 1.10 0.90 0.55 0.55 0.30 2013 2014 2015 2016 2017 2018 2019 Interim Dividend Final Dividend 12
A+ Rating Affirmed Reflects Strong Financials TRIS Rating affirms the company rating of Oishi Group PLC (OISHI) at “A+” with “Stable” Outlook October 12, 2018 Key Highlights Strong Positions The rating reflects OISHI ’ s well-known brand, leading market position in ready-to-drink (RTD) ➢ tea segment in Thailand and status as a strategically important subsidiary of Thai Beverage PLC Despite the recent drop in sales in the RTD tea segment, OISHI has remained the market ➢ leader with strong brand and an extensive distribution network which yields high market penetration Low leverage and abundant cash flow protection OISHI ’ s balance sheet as well as debt serviceability will remain strong ➢ 13 Source: TRIS
Corporate Governance and AGM Scores Good Corporate Governance Scores Oishi Group Listed co Avg 2018 2014 2015 2016 2017 2018 Rights of Shareholders 89 94 95 95 95 94 Equitable Treatment of Shareholders 96 98 99 99 99 90 Role of Stakeholders 76 80 79 91 92 80 Disclosure and Transparency 84 87 89 93 96 85 Board Responsibilities 70 76 81 81 85 72 Total score 78 84 86 88 91 81 Source : Thai Institute of Directors ( สมาคมส่งเสริมสถาบันกรรมการบริษัทไทย ) AGM Quality Score Listed co 2014 2015 2016 2017 2018 Avg 2018 Oishi Group 97 100 99.25 100 99 92.42 Source : Thai Investors Association ( สมาคมส่งเสริมผู้ลงทุนไทย ) 14
Beverage Business 15
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