AAPICO HITECH PLC [AH] Presentation for FS 2018 financial statements - - PowerPoint PPT Presentation
AAPICO HITECH PLC [AH] Presentation for FS 2018 financial statements - - PowerPoint PPT Presentation
AAPICO HITECH PLC [AH] Presentation for FS 2018 financial statements Opportunity Day 28 March 2019 Disclaimer The information contained in this material has been prepared by AAPICO Hitech PLC (AH or AAPICO) solely for information
Disclaimer
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The information contained in this material has been prepared by AAPICO Hitech PLC (“AH” or “AAPICO”) solely for information purpose and does not constitute an offer or invitation to sell or the solicitation of an offer or invitation to purchase or subscribe for shares in AAPICO. Some statements made in this material are forward-looking statements. These statements typically contain words such as “expects” and “anticipates” and words of similar import. Any statement in these materials that are not a statement of historical fact is a forward-looking statement that involves various risks and uncertainties. These include statements with respect to our corporate plans, strategies, and beliefs. These statements are based on our management assumptions and beliefs in light of the information currently available to us. These assumptions involve risks and uncertainties which may cause the actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. None of the future projections, expectations, estimates or prospects in this presentation should be taken as forecasts or promises nor should they be taken as implying any indication, assurance or guarantee that the assumptions on which such future projections, expectations, estimates or prospects have been prepared are correct and exhaustive or, in the case of the assumptions, fully stated in the presentation. We assume no
- bligations to update the forward-looking statements contained herein to reflect actual results, changes in assumptions or changes in factors
affecting these statements. Accordingly, no representation or warranty, express or implied, is made or given by or on behalf of AAPICO or any of its shareholders, directors,
- fficers or employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in this
- presentation. None of AAPICO nor any of its shareholders, directors, officers or employees accepts any liability (in negligence or otherwise)
whatsoever for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection therewith. Individual situations and local practices and standards may vary, so viewers and others utilizing information contained within a presentation are free to adopt differing standards and approaches as they see fit. Products and names mentioned in materials or presentations are the property of their respective owners and the mention of them does not constitute an endorsement by AAPICO. The information contained in this presentation is
- nly current as of the date its date. In giving this presentation, neither AAPICO nor its respective advisers and/or agents undertake any obligation
to provide the recipient with access to any additional information or to update this presentation or any additional information or to correct any inaccuracies in any such information which may become apparent. You must make your own assessment of the relevance, accuracy, and adequacy
- f the information contained in this presentation and must make such independent investigation as you may consider necessary or appropriate
for such purpose. The presentation should not be construed as legal, tax, investment or other advise. ir@aapico.com | +66-(0)-2613-1504
Agenda
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1. Company Information 2. Automotive Industry Updates 3. Financial Performance 4. Strategy & Direction
AAPICO Hitech PLC
AAPICO HITECH PLC [AH]
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AAPICO HITECH PUBLIC COMPANY LIMITED
- A leading OEM automotive parts manufacturer in
Thailand with global operations through strategic partnerships in India, Portugal, USA, and China.
- Core businesses: OEM Auto Parts, Jigs and Dies,
Car Dealerships and Car Navigation.
- Main locations: Thailand, Malaysia and China.
- Registered and paid-up capital of Baht 322.58
million, comprising of 322,583,844 ordinary shares at par value of Baht 1 each.
- Major shareholders are Yeap Swee Chuan and
Family holding 45.52% of total capital.
Index : SET / THSI Industry/Sector : Auto Current price : Baht 23.20* 52 weeks range : Baht 21.50 – 40.00 Market Cap : Baht 7,484 million* P/E (YTD) : 5.32* P/BV : 1.00* Dividend yield** : 5.17% TRIS / CG Rating : BBB+ /
* Data as of March 1, 2019 ** Dividend yield is calculated based on current share price
AAPICO’s Vision
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Where do we want to go? How do we want people to remember us?
MANUFACTURING RESEARCH & DEVELOPMENT CAR RETAILING
TO BECOME A LEAN, GREEN, HAPPY, DIGITAL WORLD-CLASS CORPORATION
- S : Safety
- Q : Quality
- C : Cost
- D : Delivery
- E : Engineering
- M : Management
(Focus Digital)
- Teamwork
- Look at problems as
- pportunities
- Love Family, Company
and Country
- Loyalty and Honesty
- Mutual Respect
- Profitability
- Reasonable Dividend
- Corporate Social
Responsibility
Happy Employees Happy Shareholders Happy Public Happy Customers AAPICO Key Fundamental Values
Core Pillars of AAPICO Business
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Auto Part Manufacture Car Dealerships Technology
IOT Connectivity & Mobility Business
Business Segments
8
Manufacture of Auto Parts
(Thailand & China)
Car Dealerships
(Thailand & Malaysia)
Technology
(Thailand) ~64% of total revenue ~36% of total revenue <1% of total revenue
Thailand Malaysia
Stamping & Assemblies Forging & Machining Plastic Jigs and Dies
Countries of Operations
9
Thailand 73% Malaysia 23% China 4%
2018
Sales by Country
CHINA
Kunshan Production: Connecting rods and Copper Forging
MALAYSIA
Kajang & Petaling Jaya Car dealers: Honda car
THAILAND
Ayutthaya, Chonburi, Rayong, Samutprakarn
Hitech Industrial Estate
Production: Stamping parts and Stamping Dies & Jigs
Amata Nakorn Industrial Estate
Production: Stamping & Chassis Frames and Forging & Machining Parts
Bangpli Industrial Estate
Production: Plastic Parts
Amata City Industrial Estate
Production: Stamping Parts Plastic Washers & Fuel Tanks
Mitsubishi Dealers
Navanakorn & Ramindra
Ford Dealers
Samutprakarn & Ladprao
Major OEM Customers
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Our Partners
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Joint Venture
Strategic Partner Technical Partner
Awards and Achievements
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AAPICO Group has been widely recognized for its excellence in product quality, efficiency in its production processes, and continuous improvements over the years. The Company has repeatedly received awards from its customers and partners in recognition for excellent quality and delivery and contribution to growth.
Automotive Industry Updates
Thailand Car Production Volume
14
276 264 302 288 310 295 313 332 200 192 214 213 220 212 224 221
486 465 527 511 540 517 548 564
- 100
200 300 400 500 600 700
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 Pick-Up/PPV Passenger Others Domestic Sales Export Sales
1,130 1,250 827 885
1,989 2,168 2017 2018
Total Car Production by Quarter
Jan-Dec Car Production
‘000 Units
+9.0% yoy +10.3% yoy
Source: The Federation of Thai Industry (Automotive Industry)
425 512 346 400
101 130
872 1,042 2017 2018
Thailand Domestic Car Sales Volume
15
Domestic Car Sales by Quarter
Jan-Dec Domestic Sales
107 94 102 121 118 119 123 151 80 81 83 102 90 100 101 109
23 24 25 28 29 33 34 35
210 199 211 251 237 252 257 295
- 100
200 300 400
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1-Ton Pick-Up/PPV Passenger cars Other vehicles
‘000 Units
+17.6% +19.5% yoy
Source: The Federation of Thai Industry (Automotive Industry)
Thailand Export Volume
16
Export Volume by Quarter
Jan-Dec Export Volume
2017 2018 284 252 314 290 295 267 297 282
- 100
200 300 400
1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 Export Volume
‘000 Units
- 2.7%
yoy +0.08% yoy
Source: The Federation of Thai Industry (Automotive Industry)
Thailand Total Industry Volume
17
#
Maker Q4 January – December
2017 2018 % 2017 2018 %
1 Toyota
74,265 90,782 +22.2% 239,551 314,498 +31.3%
2 Isuzu
41,746 52,196 +25.0% 160,550 177,864 +10.8%
3 Honda
34,497 35,375 +2.5% 127,768 128,290 +0.4%
4 Mitsubishi
20,962 23,303 +11.2% 69,737 84,560 +21.3%
5 Nissan
17,105 21,304 +24.5% 59,709 72,394 +21.2%
6 Mazda
14,734 18,720 +27.1% 51,355 70,475 +37.2%
7 Ford
16,648 16,457 -1.1% 56,156 66,064 +17.6%
14 Hyundai
1,453 1,718 +18.2% 4,917 5,264 .+7.1%
Others
29,525 35,300 +19.6% 101,907 122,330 +20.0%
Total
250,935 295,155 +17.6% 871,650 1,041,739 +19.5%
Source: Toyota
Malaysia Total Industry Volume
18
#
Maker Q4 January – December
2017 2018 % 2017 2018 %
1 Perodua
53,307 59,040 +10.8% 204,887 227,243 +10.9%
2
Honda
30,769 22,367 -27.3% 109,511 102,282
- 6.6%
3 Toyota
20,202 12,902 -36.1% 69,492 65,551
- 5.7%
4 Proton
14,695 15,511 +5.6% 70,991 64,744
- 8.8%
5 Nissan
6,395 7,877 +23.2% 27,154 28,610 +5.4%
6 Mazda
2,728 4,992 +83.0% 9,730 16,038 +64.8%
7 Mercedes
3,373 3,002 -11.0% 12,344 13,463 +9.1%
14 BMW
2,985 3,027 +1.4% 10,618 12,008 +13.1%
Others
16,500 15,025 -8.9% 61,898 68,775 +11.1%
Total
150,954 143,743 -4.8% 576,625 598,714 +3.8%
Source: MAA
Financial Performance
2018 vs. 2017
Financial Highlights
20
- Revenue growth driven by higher auto parts sales
and increased interest income.
- Gross profit increased with gross profit margin
improved to 7.6%, driven by higher sales, improved efficiency and on-going cost reduction.
- SG&A expenses decreased due to cost control and
lower unrealized FX loss.
- Tax expenses decreased due to the recognition of
deferred tax assets.
- Core profit from operations significantly increased.
Despite lower profit from associates due to SGAH, net profit continually improved. Net profit margin improved from 7.0% to 7.3% of sales.
Full Year Key Financials
In Million Baht
Jan-Dec 2017 Jan-Dec 2018 Revenues
Growth%
16,642
+9.9%
17,737
+6.6%
Gross Profit
GP Margin (%)
998
6.3%
1,274
7.6%
SG&A 928 868 Interest & Tax 180 167 Core profit
Profit Margin (%)
670
4.0%
1,195
6.7%
Associate 488 104 Net Profit
NP Margin (%)
1,158
7.0%
1,299
7.3%
D/E (x) 0.69 0.80
16,642 17,737
2017 2018
Jan-Dec Revenue
AH Group Revenue increased yoy
21 3,946 3,903 4,284 4,509 4,496 4,283 4,416 4,576
3,000 3,500 4,000 4,500 5,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18
Total Revenues by quarter
Sales Other income Interest income
- ne-time gains
- FY2018 Revenue grew 6.6% yoy, driven by increased sales in
automotive parts business and increased interest income from loan to SGAH.
THB million
+6.6% yoy
Auto parts 64% Car dealers 36% Technology 0%
2018
+1.5% yoy
Auto Parts: Sales & EBIT increased
22
2,470 2,286 2,511 2,432 2,685 2,473 2,582 2,901
8.3% 4.9% 3.5% 5.6% 7.8% 9.6% 7.3% 10.9%
- 1,000
2,000 3,000 4,000 5,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18
Sales and EBIT by quarter
Thailand China EBIT% 9,699 10,641 5.6% 9.4%
2017 2018
Jan-Dec Sales & EBIT
THB million
+9.7% yoy
TH 93% CN 7%
2018
- FY2018 sales growth of 9.7% was driven by higher sales in both
Thailand and China. EBIT margin improved yoy, from 5.6% to 9.4% of sales, attributable to improved efficiency and on-going cost reduction, as well as lower unrealized FX loss.
Car Dealers: Sales & EBIT improved
23
1,355 1,340 1,539 1,834 1,578 1,528 1,587 1,388
1.1% 1.3% 1.2% 1.3% 1.3% 1.5% 1.5% 1.5%
- 1,000
2,000 3,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18
Sales and EBIT by quarter
Thailand Malaysia EBIT% 6,068 6,081 1.3% 1.4%
2017 2018
Jan-Dec Sales & EBIT
THB million
+0.2% yoy TH 37% MY 63% 0%
2018
- FY2018 Sales grew by 0.2% yoy. Sale increases in Thailand were
partly offset by lower Malaysian car sales for Honda. EBIT margin improved yoy from 1.3% to 1.4% of sales.
AH Group Strong Earnings increased
24 321 451 339 396 461 512 468 560
- 200
400 600 800 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Unit: THB Million
EBIT Depreciation 1,506 2,001
2017 2018
EBIT Depreciation 3.9% 7.5% 4.3% 5.5% 6.7% 8.0% 6.9% 10.0% 8.1% 11.6% 7.9% 8.8% 10.3% 11.9% 10.6% 12.2% 0% 5% 10% 15%
Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Unit: as % of revenue
EBIT% EBITDA% 5.3% 7.9% 9.0% 11.3%
2017 2018
EBIT% EBITDA% 32.9% yoy
Strong Profit increases offset SGAH loss
25 224 315 243 376 397 305 302 295
(200) (100)
- 100
200 300 400 500 600 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Unit: THB Million
Profit to equity holders from operations Associate income 1,158 1,299
2017 2018
Operations Associate 5.7% 8.1% 5.7% 8.3% 8.8% 7.1% 6.8% 6.4%
0% 5% 10% Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Unit: as % of revenue
Net Profit % 7.0% 7.3%
2017 2018
Net Profit % 12.2% yoy
Financial performance is at good level
26 10.1% 13.0% 14.8% 17.8% 19.5% 18.9% 19.8% 17.7%
0% 10% 20% 30%
Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18
Return on Equity (ROE)
ROE (In the Quarter) ROE (Seasonally adjusted)
5.5% 6.3% 7.3% 9.1% 10.3% 9.0% 9.2% 8.2%
0% 5% 10% 15%
Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18
Return on Asset (ROA)
ROA (In the Quarter) ROA (Seasonally adjusted)
6.4 8.1 8.4 9.2 9.1 8.5 8.8 7.7
0.0 4.0 8.0 12.0
Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18
Interest Coverage Ratio (ICR)
ICR (In the Quarter) ICR (Seasonally adjusted)
2.2 3.2 2.9 2.5 2.1 2.9 2.7 2.8
0.0 2.0 4.0 6.0
Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18
Debt to EBITDA
Debt/EBITDA (In the Quarter) Debt/EBITDA (Seasonally adjusted)
Net gearing in line with target
27
- Net interest-bearing debt to equity ratio as of December 2018 had
increased to 0.80x, compared to 0.69x as end of 2017, and was within the Company’s target of less than 1.00x.
- Total liabilities net cash (Net debt) to equity ratio as end of December
2018 had increased to 1.18x, which was still within the financial covenant target of less than 2.00x.
ST Loan 9% CPLTD 23% LT Loan 49% LT Bond 19%
Interest-bearing Debt
Interest-bearing debts increased to THB 6.4 billion as
- f December 2018.
In 2018, the Company’s debts increases of THB 1.4 billion was mainly due to SGAH investment and new projects. 1.07 0.85 0.67 0.55 0.40 0.69 0.60 0.56 0.62 0.80 1.74 1.26 1.07 0.87 0.74 0.99 0.92 0.91 1.01 1.18
0.0 0.5 1.0 1.5 2.0 0.0 2.0 4.0 6.0 8.0 2012 2013 2014 2015 2016 2017 Q1/18 Q2/18 Q3/18 Q4/18 Unit: in THB Billion
Debts Equity D/E (L-C)/E
Strategy & Direction
Thailand Automotive Outlook in 2019
29 0.46 0.58 0.75 0.93 1.13 1.19 1.29 1.39 1.00 1.65 1.46 2.45 2.46 1.88 1.91 1.94 1.99 2.17 2.15
- 0.5
1.0 1.5 2.0 2.5 3.0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 …. Production Forecast Domestic Export
Unit: Million
Global Financial Crisis Flood First car campaign
Source: The Federation of Thai Industry (Automotive Industry)
Thailand automotive industry expects to maintain production volume at 2.15 million cars, of which 1.05 million cars to be sold locally and 1.1 million cars for export.
- 0.8%
Stable sales volume with steady growth
30
100 200 300 400 500 Y02 Y03 Y04 Y05 Y06 Y07 Y08 Y09 Y10 Y11 Y12 Y13 Y14 Y15 Y16 Y17 Y18 Y19 Y20 Y21 Y22 Y23 Y24 Y25 Y26 Y27 Y28
Global Financial Crisis Flood First car campaign
Unit: in thousand Previous model Current model New model
Sample of automotive parts sales orders for current and new models
Continued orders going forward
31
Confirmed orders – 5 years for cars and 10-12 years for pick-up truck
ISUZU
D-Max Mu-X
Nissan
Navara Terra
TOYOTA
Hilux Revo Fortuner
FORD
Ranger Rapter Everest
Mitsubishi
Triton Pajero Sport
Honda
City Brio HRV BRV
Toyota
HRV Camry Altis Vios Yaris
Mazda
Mazda 2 CX3 BT-50 PRO
Nissan
Teana Almera Syphy Note March
FORD
Fiesta Focus Eco Sport
1.2 2.0 2.2 2.7 2.8 4.1 4.1 4.8 5.6 9.7 11.2 29.0 Indonesia #17 Thailand #12 France #10 Brazil #9 Spain #8 Mexico #7 S.Korea #6 India #5 Germany #4 Japan #3 USA #2 China #1 Unit : Millions 2017 2016
Global Business Opportunities
32 China 30% Japan 10% India 5%
Thailand 2%
Rest of Asia 8%
Europe 23% America 21% Africa 1%
2017
Source: OICA
Top 10 Motor Vehicle Production Country in 2017
2017 Global Production Volume was 97 million units Major OEM Brands in Thailand Thailand Volume 2 Million
Business Strategy – To be Global
33
CHINA INDIA EUROPE USA JAPAN THAILAND MALAYSIA
Key Milestones
34
Taking steps toward globalization 2017-2018
- Established strategic
global partnership with Sakthi Group and invested US$100 million for 25.1% stake in Sakthi Global Auto Holding Limited (SGAH).
- Signed JV MOU with
VINFAST to set up assembly plant in Haiphong, Vietnam for the first 2 models of VINFAST vehicles.
- Acquired additional
24.89% equity in SGAH.
2013-2016 2008-2012 2005-2007 2002-2004
- Listed on SET.
- Acquired a chassis
frame factory from Dana Corporation.
- Expanded to China.
- Established strategic
global partnership with Sojitz Corp.
- Established JV with
Mitsuike Corp.
- Acquired forging
business from KPN.
- Established JV with
Minth Corporation.
- Established JV with
Takagi Seiko.
- Completed
construction of 3S showroom in Malaysia.
- New factory in
Kunshan (China) started operation.
- Established JV with;
- Lemtech (Taiwan)
- Edscha (Germany)
- Sumino (Japan)
- Sodecia (Portugal)
- Explored opportunity
in the start-up business.
- Established AAPICO
Training Center.
- Issued bond with a
BBB+ credit rating.
- Achieved 4-star CG
rating.
Partnership with VINFAST
35
AVA
51% 49%
AAPICO Vinfast Auto Parts Co.,
- Ltd. (AVA) was established on 24
January 2019. Registered capital was VND 465.9 billion. (~USD 20 million) AVA will lease 30,000 m2 plant from VINFAST and install 2 large and 1 small press line with its
- wn assembly facilities to supply
Body-in-White (BIW) parts to VINFAST main assembly line.
AAPICO-VINFAST Factory Hai Phong, Vietnam
Status: On Track
AAPICO is responsible for the overall management of the project including technology and know-how, plant design, and equipment
- sizing. Jigs and Dies tooling for VINFAST’s vehicles is expected to be
delivered within Q3 2019.
Project Size Number of Toolings Vendors
1,800
THB Million
714
Dies
287
Jigs
40
TH, KR, MY, CN, JP
Sakthi Global Auto Holding Limited (SGAH)
36 ABT Auto Investments Limited (UK) AAPICO Group (Thailand) Sakthi Global Auto Holdings Limited (“SGAH”) INDIA USA 50.01% 49.99%
SGAH Company Holding Structure
PORTUGAL CHINA
- A world-class OEM automotive parts
supplier with global manufacturing footprints in India, Portugal, USA and China.
- No. 1 market leader in knuckles with
- ver 80% market share in Indian
market.
- A global leader in aluminum knuckle
and a market leader in China.
- Consistent quality and timely delivery
to world-class customers i.e. GM, Ford, Suzuki, Renault, VW, Dana, Continental, etc.
- Strong R&D and testing facilities in USA
and India. Globally competitive.
Synergy with Sakthi Group
37
Product Enlargement
- AAPICO imported casting products from Sakthi Portugal and
complete machining process in AAPICO for Ford Thailand. Revenue is around THB 150 Million.
- Sakthi received aluminium casting knuckle order for new
Ford pick up in 2021 for Thailand market. Customer Expansion
- AAPICO is receiving RFQ for supply to USA via Sakthi
connection in USA.
- AAPICO has helped Sakthi to open up with Isuzu. Sakthi will
be exporting to Isuzu. Stronger Marketing
- Synergies in marketing for Ford, GM, and others.
- Perceive AAPICO - SAKTHI as very positive to handle larger
project globally.
Potential to build a strong customer base
38
Global OEMs SAKTHI AAPICO Potential Strength
Ford Strong Strong Strong GM Strong Weak Strong VW Strong Weak Strong Renault Strong Weak Strong Suzuki Strong Weak Strong Toyota Weak Strong Strong Nissan Fair Strong Strong Isuzu Weak Strong Strong Mazda Weak Strong Strong China Strong Weak Strong Dana Strong Fair Strong Honda Fair Fair Fair Mitsubishi Weak Weak Weak
Global Manufacturing Footprints
39 Detroit, USA Durango, México Coimbatore/Erode, India Rushan, China Porto, Portugal Thailand Malaysia Singapore Kunshan, China London, UK AAPICO Facilities Sakthi Facilities Other JV partners
Japan Taiwan Germany
New York, USA
Profitability Trend 2017 – 2019
40
SGAH Profit Liquidity India Portugal USA China
2018
SGAH Profit Liquidity India Portugal USA China
2019
SGAH Profit Liquidity India Portugal USA China
2017
Key focus points
41
1.
Strong operational performance improvement. Revenue and profit is
- n the upside.
2.
Cash flow from operations continually increased.
3.
Strong financial position with good governance and credit rating.
4.
Good dividend payment. Paid dividend at THB 1.20 per share in 2017 and propose to increase dividend to THB 1.30 per share for year 2018.
5.
Successful to win substantial orders starting end 2019 / early 2020.
6.
New substantial order and expansion into Vietnam.
7.
Global expansion of AAPICO is on the roll.
Guidance for the year 2019
42
Thailand Malaysia China
12,188 3,818 732
Sales by Country
(Unit : Million Baht) 2017 2018 2019
Auto Parts Car Dealers
10,657 6,081
Sales by Segment
(Unit : Million Baht) 2017 2018 2019
Improvements are expected in all core pillars of our businesses.