Analyst Presentation December 2017 Strictly Private & - - PowerPoint PPT Presentation

Strictly Private & Confidential

Analyst Presentation

December 2017

Strictly Private & Confidential Page 1

Table of Content

Company Overview Compelling Investment Story Financial Highlights

Strictly Private & Confidential

Company Overview

Strictly Private & Confidential Page 3

Sahathai at a Glance

Business Description  Sahathai offers one-stop solution of logistic activities mainly in water transportation. The company‟s services currently include terminal operation, in-land transportation, warehouse and yard rental services, and other related service in water logistic  With its strategic location on the Chao Phraya River, Sahathai‟s customers rely on its ability to meet their requirements with a full range of solutions and support services, all

• f which meet international best practice standards while allowing the flexibility only an

independent operator can offer Company’s Vision “To be Thailand’s innovative logistics solution provider of choice” Leading private port operator providing total logistic solution

Business Operating companies Key Scope of Works Revenues contribution (9M2017) Revenue (2016) Revenue (9M2017) Service Location Terminal STT / BBT / BBS / BCDS

• 1. Feeder terminal /1
• 2. Barge terminal and barge transportation /1
• 3. Container Freight Station
• 4. Container Depot

75.1% 921.42 740.85 Samutprakarn/ Laemchabang In-land transportation STT In-land container transportation by truck fleets 6.9% 58.02 67.88 Bangkok/ Samutprakarn/ Laemchabang Warehouse & Yard STT General & freezone warehouse and yard rental 7.6% 53.83 74.49 Samutprakarn Others STT Freight forward 10.5% 47.22 103.26 Samutprakarn 1,080.48 986.49

Remark :

• 1. Collectively called “terminal handling” business/operation

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Our Evolution

• The company was

founded in 2008, named Sahathai Coastal Seaport, to support Sahathai Steel Pipe (“STS”) for terminal handling service 2008

• Partner with Mitsui OSK

Shipping Line (“MOL”) to establish Bangkok Barge Terminal (“BBT”) to set up new barge terminal 2015

• Partner with Mediterranean

Shipping Company (“MSC”) to establish Bangkok Barge Services (“BBS”) for barge transportation service 2016 2017

• BCDS was found to be transferred the

container depot operation from Sahathai

• The company plans to

be a Total Logistics Solution Providers with integrated services in logistics for customers 2020

Other key highlights  In 2015, STS transferred its entire shares in STT to its existing shareholders for group restructuring purpose  The company has been expanding and diversifying its business in various logistics services in recent years, i.e., stuffing and unstuffing service (CFS), container depot service, container barge transportation, container ground transportation, freight forwarder, general and freezone warehouse & yard service

2013

Total Logistic Solution Expansion, Diversification & Strategic Alliance Start-up

• Rebranded to

Sahathai Terminal in order to be well- known recognized by customers

• BBT is the first company in Thailand which has been granted

Inland Container Depot (ICD) license for water transportation

• Mobile X-ray is allowed to use in Sahathai‟s port

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Shareholding Structure

IPO & ESOP Karuchit Family Rattanasirivilai Family Bangkok Barge Terminal (BBT) Business Commercial Terminal for domestic use Capital THB 175 million Shareholder Sahathai Terminal 51% MOL Liner Ltd. 49% Bangkok Barge Services (BBS) Business Barge Fleet Management Capital THB 30 million Shareholder Sahathai Terminal 40% Global Thai Depot/1 30% Medlog SEA/1 30% Bangkok Container Depot Service (BCDS) Business Empty Container Depot Services Capital THB 170 million Shareholder Sahathai Terminal 99.99% 47.99% / 35.47% 24.39% / 18.02% 27.62% / 20.42% 51.00% 40.00% 99.99% Other Existing Shareholders

Subsidiary Associate

Remark : 1. MSC group

0.00% / 26.09% Sahathai Terminal (PORT) Business

• Commercial Terminal for

international and domestics uses

• Logistic services

Capital THB 230 million (Registered) THB 170 million (Paid-up) Note : % pre-IPO / % post-IPO

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Operating areas

Strategic operating location

Sukumvit Road Poochaosamingprai Road Karnchanaphisek Road Sirat express way Chaloem Mahanakhon express way Bangkok express way Rama III Road Industrial Ring Road (Bhumibol Bridge) Suksawat Road

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Land Profile

Land Profile 2 1 1

Warehouse Free zone

Feeder Terminal Container Depot

6 4 5 2 3

CFS Barge Terminal

Barge container yard

No. Area (Rai-Ngan-Sq.wah) Expired Date (including extended period) 1 25-1-25 31 December 2037 2 41-1-11 30 June 2019 and can extend twice for 3 years each 3 8-1-29 30 June 2019 and can extend twice for 3 years each 4 18-2-95 30 November 2032 5 12-0-0 30 September 2019 6 15-1-73 30 November 2032 No. Area (Rai-Ngan-Sq.wah) Expired Date (including extended period) 1 14-0-16.6 Own 2 25-1-89 31 July 2045

 The operating land of BCDS is wholly owned for container depot service with total area of 36 Rai 2 Ngan 6 Sq.wah. The distance from BCDS‟s area and Sahathai is circa 2 km  In 2018, All of container depot operation, which is currently

• perated on some part of Land No. 2 in Sahathai, will be

transferred to BCDS. As such, the capacity to operate container depot business will increase as well as capacity to operate terminal handling business due to larger land area

Sahathai Terminal Bangkok Barge Terminal Bangkok Container Depot Service

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Company’s service overview

Shuttling service between STT port and LCB port, the Thailand‟s biggest gateway to import and export goods, through coastal barge and truck

LCB

Sahathai Connect with the intra-Asia route and the world via international feeder directly docked at international port

• f STT

Convenient for importer and exporter with one-stop service

• f on-site customs

clearance at STT‟s port Ready with stuffing and unstuffing service, both FCL (full container load) and LCL (less than container load) Full range of storage service, up to customer‟s demand, comprising of general warehouse, freezone warehouse, container yard, freezone container yard Utilizing its wide range of relationship with various shipping lines, STT also provides freight forwarding service to facilitate the customers in the fatigue process of freight negotiation and coordinates with shipping lines and a chunk of paperwork. World trading market Equipped with 1 international port and 2 domestic ports with total berth length of 300 meters ready for international vessel with 172 meters alongside and domestic coastal barges and also operate another domestic port through its subsidiary (BBT) (holding 51% stakes) International Feeder Customers directly get/admit full laden containers at the port and conduct stuffing and unstuffing activities on its site The Company is equipped with container depot service nearby STT‟s port in which it is enable the customers to efficiently manage their logistics. The service includes container inspection, cleaning, maintenance, repair and upgrade Importer / Exporter Ground transportation service to accommodate the customers for container transportation between STT‟s port and the customer‟s site

Vertical Integration along the logistics value chain

“With vertical integration along the value chain, Sahathai can respond to all customer’s need with full range of services, solutions and supports”

Container Yard CFS Service of STT group Not service of STT group Reposition Consignee Return

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36.07 40.05 48.14 35.43 33.03 241.37 258.75 351.97 253.30 294.18

• 50

100 150 200 250 300 350 400 2014 2015 2016 9M2016 9M2017

One-stop Solution Provider

Terminal In-land Transportation Freight Forward General & Freezone Areas Expert in terminal handling business High efficiency of terminal operating system from professional platform

In-house developed software (PMS) Booking arrangement and electronic data interchange (EDI), Container depot, CFS Purchased software (TOS) Resource optimization tool  Efficiency on berth planning, crane scheduling, loading/unload sequencing and space planning  Cost reduction on redundant full-time employees  High creditability in terminal operation to customers  Ability to initiate terminal business in new ports in the future

1 2 1 1 Barge terminal 1 Berth (90 m)

Sahathai Terminal Bangkok Barge Terminal

Operating areas Type of Services Types of Crane Main Equipment Customer References 74 of 121 Rais are utilized for Terminal handling (Lease 100%)

• Feeder &

Barge terminal

• Barge

transportation

• 2 Gantry

cranes

• 2 Jib cranes
• 2 RTG

cranes

• 1 Mobile

habour crane

• Reach

stackers

• Side stackers
• Yard trucks
• Material

handling equipment Operating areas Type of Services Types of Crane Main Equipment Customer References 39 Rais (Own 36%)

• Barge

terminal

• Barge

transportation

• 2 Jib cranes
• Reach

stackers

• Yard trucks
• Material

handling equipment

Unit: ’000 (TEUs)

Laden Empty

Container Throughput BOI Privilege 8 years ended Jan 2024 8 years ended Oct 2024

Remark: Container throughput on the Company, BBT, and service provided to other ports

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Operating areas Type of Services Main Equipment Container Throughput 12 Rais (Lease 100%)

• Stuffing
• Unstuffing
• Outsourcing equipment

and workers

One-stop Solution Provider

In-land Transportation Freight Forward General & Freezone Areas Container Freight Station Container Depot

Sahathai Terminal

CFS (Stuffing) (12 Rais)

25.91 33.78 38.85 30.85 22.20 6.49 4.70 6.56 5.62 5.20

• 10

20 30 40 50 2014 2015 2016 9M2016 9M2017

Shipper Exported goods

Stuffing

Imported goods Consignee

Unstuffing LCL/FCL LCL/FCL

Unit: ’000 (TEUs) Unstuffing Stuffing

Sahathai Terminal

Container Depot (15 Rais)

Operating areas Type of Services Main Equipment

• No. of serviced containers

15 Rais - current (Lease 100%) 36 Rais – 2018

• nwards

(Own 100%)

• Cleaning
• Repair &

Maintenance

• Lifting
• Storage
• Outsourcing equipment

and workers

Container Depot operation will be entirely transferred to BCDS in 2018

31.66 27.14 44.07 39.08 24.38 46.68

• 10

20 30 40 50 2014 2015 2016 9M2016 9M2017 Beginning in 2Q2016

• Not in operation -

Repair & Maintenance Cleaning

Reposition Container Return to Shipping agents/ Exporters for stuffing Consignee Return Container

Container depot service (Imported by shipping agents) (Returned by Consignee) Reposition Container: service fee charged to Agents

Exported goods

Consignee Return Container: service fee charged to Agents/Consignee

Unit: ’000 (TEUs)

Terminal

Container Yard (LCL) (Unstuffing)

Strictly Private & Confidential Page 11 Leasable area : 20,766 sqm Tenant : 6 tenants (Lazada & companies in foods, steel, ceramic, can, etc.) Contract period : 3 years

One-stop Solution Provider

In-land Transportation Freight Forward General & Freezone Areas In-land Transportation

Chonburi (Laemchabang) Bangkok

Operating areas Type of Services Main Equipment

• No. of serviced containers

Bangkok/ Samutprakarn/ Chonburi

• In-land container

transportation by trucks

• Outsourcing trucks and

drivers

General & Freezone Areas

11.30 10.67 10.25 8.74 23.53

• 5

10 15 20 25 2014 2015 2016 9M2016 9M2017 Unit: ’000 (Containers) Serviced Containers

1

Service in Bangkok/Samut prakarn area

2

Service in Laem- chabang area

3

Service in between Bangkok/Samutprakarn and Laemchabang

Freight Forward

Exporter Importer Destination

• Warehouse
• Port
• Factory

Sahathai Terminal

Freezone Warehouse (15 Rais) General Warehouse Freezone yard (18 Rais)

Freezone Areas

Freezone warehouse Freezone yard Service storage yard to customers Leasable area : 17,511 sqm Tenant : Mercedes Contract period : 4 years (from May 17)

General warehouse

 Shipment organization for customers to ship imported/exported products from/to desired destinations through water transportation  Strategic networks with worldwide shipping agents

36.16 16.30 99.08

• 10

20 30 40 50 60 70 80 90 100 2014 2015 2016 9M2016 9M2017

Exporter Importer

Request order

Shipping Agents

Negotiate on freight slots

Unit: THB million Beginning in 1Q2016

• Not in operation -

Revenue

Revenue

Terminal

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Compelling Investment Story

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1 2 3 Leading private port operator in oligopoly market One of the fastest growth segment in logistics industry Competitive Advantages of the Company 4 Opportunity on increasing profitability Key Investment Highlights 5 Risk mitigation by business alliance model

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Leading private port operator in oligopoly market

Remark :

• 1. Based on international throughput volume (export and import) for 2016
• 2. From announced capacity of Bangkok Port by the government Source : Bangkok Ship owners and Agents Association (BSAA)
• 3. Volume from Nov‟16 (COD) to Dec‟16

Bangkok Port (Klong Toey Port)

• Owned by Port Authority of Thailand
• International throughput : 1.5 million TEUs /1
• 7 International Berth, with 14 quay gantry cranes
• Container yard of 148k sqm
• Estimated capacity : 1.34 million TEUs/2
• The biggest container terminal in Bangkok.
• Overutilized capacity

Poo Jao Container Terminal

• Owned by Regional Container Lines PCL group

(RCL) and Thai Sugar Terminal PCL group (TSTE)

• International throughput : 2.1k TEUs /1
• 1 International Berth, with 2 mobile harbor cranes.
• Container yard of 36k sqm.
• The port has just been open in 2016.

Thai ProsperityTerminal

• Owned by Regional Container Lines PCL group

(RCL) and The Siam Cement PCL group (SCG)

• International throughput : 0.14 million TEUs /1
• 1 International Berth, with 2 mobile harbor cranes.
• Container yard of 40k sqm.
• Mainly used by SCG group.

Unithai Container Terminal

• Owned by United Thai Shipping Corporation
• International throughput : 0.11 million TEUs /1
• 1 International Berth, with 3 quay gantry cranes
• Container yard of 60k sqm.

BMT Pacific Terminal

• Joint venture between 1. Bangkok Modern Terminal, a

private terminal operator 2. Pacific International Lines Pte, a shipping line 3. Eastern Maritime (Thailand), a shipping agency.

• International throughput : 0.06 million TEUs /1
• 1 International Berth, with 3 mobile harbor cranes

Siam Suksawat Terminal

• Owned by Siamgas and Petrochemical PLC group (SGP),

Operated by River Port Investment Pte. (Singapore)

• International throughput : 568 TEUs /1
• 1 International Berth, with 2 quay gantry cranes.
• Container yard of 40k sqm
• The port has just been open in 2016.

Bangkok Barge Terminal

• Domestic throughput : 5.3k TEUs /3
• 1 Domestic Berth, with 2 jib cranes.
• Container yard of 30,021 sqm
• The port has just been open in 2016 for domestic

shipment.

Sahathai Terminal

• International throughput : 0.14 million TEUs /1
• Domestic throughput : 0.18 million TEUs
• 1 International Berth, with 2 quay gantry cranes and 1

mobile harbor crane.

• 2 Domestic Berth, with a jib crane each.
• Container yard of 60,929 sqm

Container terminals in Bangkok Metropolitan Region

1

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Be a part of Network in Gateway of Thailand for Global Trading With Barge shuttle service to link with Laem Chabang Port

in the most efficient way of transportation, STT and BBT is part of the network in the Gateway of Thailand for connecting with the world and all major ports around the globe for international trade.

Being the part of this network, the Company enjoys the growing

import and export sector of Thailand.

• Export sector is one of the main engine for economic

growth of Thailand, with the size of approx. 68.9% of Thailand’s GDP.

• Import sector accounts for 54.2% of Thailand’s

GDP.

• Container throughput of Thailand grow constantly at

6.8% p.a. from FY2009 (after Hamburger crisis) to FY2016.

One of the fastest growth segment in logistics industry

2

Source : Company

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One of the fastest growth segment in logistics industry

Most cost effective for domestic transport

Cost competitiveness on water transportation

2.12 0.95 0.65 10.00

Unit: Baht per ton-kilometer  Cost of domestic transportation through water is cheapest among every logistic approach  Demands of water transportation have been increasing due to cost advantage and satisfaction of customer‟s needs Opportunity to increase water transportation

2

Source : Ministry of Transportation (2015)

One Motor Barge 60-82 TEUs 2 Rails 60 Trucks

Transportation by one motor barge is comparable to

 Transportation with 2 rails  Transportation with 60 trucks  The gases that cause climate change are a major global concern, and alternative freight modes result in considerably lower emissions than overland modes such as heavy-duty trucks and rail  Substantial cost savings occur as one liter of fuel can move one ton of cargo up to 180 kilometers over waterways as compared to 25 kilometers by road and 75 kilometers by rail  Shipment transportation avoids delays from traffic cause which decreases direct and indirect cost for businesses

Source : Company

92.3%

230,600 million tons-km

6.6%

26,566 million tons-km

1.1%

2,654 million tons-km

Quantity of Transportation (Million tons-Kilometer)

Rail Water Road

Source : Ministry of Transportation (2015)

 Due to its cost effective for transportation and efficiency

• n resource utilization, there

is an opportunity for growth in water transportation in Thailand  Cost of road transportation may increase due to more strict regulation on weight of transportation per round

Efficiency on resource utilization and gas reduction

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 Thai government will continuously promote water transportation segment under the “Model shift” program with the targeted budget support of THB 76.7 billion during 2016-2025.  Planned investment mainly includes Laemchabang terminal Phase 3 project (Government and private budgets are THB 37 billion and THB 46 billion respectively), in which its maximum capacity is expected to increase to 18 million TEUs per year by 2021 (current capacity is approximately 11 million TEUs per year)  Sahathai will gain benefits due to more barge transport to Laemchabang 706 9

2 4 6 8 10 12 14 16 18 20 100 200 300 400 500 600 700 800 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

World (LHS) Thailand (RHS)

One of the fastest growth segment in logistics industry

Containerization Phenomena

Unit: Million TEUs Unit: Million TEUs CAGR 5.9% (2009-2016) CAGR 6.8% (2009-2016)

Container Throughput

Container throughput volume has been growing higher than import and export values in Thailand almost 2 times

Containerization in Thailand

Drops due to subprime event

 With the “RIMLAND” characteristic of country, Thailand has a competitive advantage for water transportation in which the main terminals comprise ports

• f Bangkok, Laemchabang, Phuket,

Songkhla and Maptaphut  Containerization becomes more popular in Thailand, with 6.8% CAGR during 2009-2016, due to its standardization and risk of damage and pilferage minimization  Containerization also encourages other monetized activities, i.e., customs broker, freight forwarder agent, logistics service and other multi-modal transport

Laemchabang Phase 3 to unlock total TEU’s operating capacity in Thailand

Laemchabang Phase 3

2

Source : World Bank, Drewry Maritime Research, Bangkok Shipowners and Agents Association Source : MarinerThai

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Customer’s Problem STT’s Solution

Unnecessary logistic cost occurs due to long distance between location of ports and container depot service area Customers cannot plan logistics flow efficiently because they cannot schedule their time table in

• advance. As such, it might need to float the

vessels for days to wait for long queuing line entering into the dock STT provides customers with single-location container terminal service with container depot service nearby STT‟s port, enabling customers to manage their logistics efficiently STT‟s provides fixed window for arriving vessels enabling the shipping lines to efficiently schedule the vessel and the customers can schedule to receive the goods the vessels in advance Customers faces with serious traffic jam and congestion problem in logistics activities STT‟s port is located on prime location, connected with many main roads through Industrial Ring Road Bridge (Bhumibol Bridge), including Rama 3 Road, Suksawat Road, Poo Jao Saming Prai Road, Karnchanapisek Road

Total solutions for customers Customer’s Problems STT’s Solutions

Competitive Advantages of the Company

3

Customers import and demand to store automotive parts for car manufacturing. In this regard, they may have to immediately pay the import duty at the time when imported automotive parts arrive to the port STT provides customers freezone yard and warehouse so that the import duty is only charged when the goods are moved out from freezone areas

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Customers are charged by shipping lines for demurrage of containers (delay on returning of the containers) Manufacturing facility areas are limited and do not have plenty of rooms to store raw materials The goods can be stored in STT‟s general or freezone warehouse so that the customers can return empty containers to shipping lines STT provides storage service which is equipped to handle a variety of cargo types along with security system, CCTV and security staff. Customers may plan their logistics with STT in

• rder to supply raw materials in Just-in-time

manufacturing process Wasted time and resource occur in the fatigue process of logistic handling i.e. freight negotiation, coordinating with shipping lines, complicated procedure of import and export and a chunk of paperwork for customs clearance STT provides integrated logistic service to customers by utilizing its full range of service and wide relationship with various shipping line for

• ne-stop service to customers. The customers

can leave these tedious process in reliable and experienced hand of STT

Total solutions for customers Customer’s Problems STT’s Solutions

Competitive Advantages of the Company

3 “To be Thailand’s innovative logistics solution provider of choice”

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Opportunity on increasing profitability

Covered investment to capture growth Available supporting resources Supports from Business Partners Well-performed stakeholder management has been allowing Sahathai to create and manage stakeholder relationships, leading to:

• Improved communications
• Converted competitors to customers
• Converted customers to partners
• Increased stakeholder engagement
• Improved service delivery and productivity
• Supported activities from stakeholders

Customer Employee Competitor Society Counter party Government Creditor Community CAPEX in new assets for better performance

199 346 277 556

67 66 66 50 50 50 160

2014 2015 2016 2017E 2018E 2019E 2020E CAPEX Unit: THB Million

 Reach stackers, Warehouse, Container yard  Crane, Container yard  Barges  Land & Construction Investment to capture potential growth (2016-2017)

High Investment in 2017 due to investment in BCDS and freezone warehouse

10 20 30 40 50 60 4Q 1Q 2Q 25 50 75 100 125 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q … 4Q 2015 2016 2017 Unit: „000 TEUs Maximum capacity (420k TEUs/year)

Container Throughput - Sahathai

Potential upside after container depot is moved to BCDS 2018

Container Throughput - BBT

Maximum capacity (170k TEUs/year) Unit: „000 TEUs 10 20 30 40 50 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 2016 2017 Unit: „000 TEUs Maximum capacity (120k TEUs/year) 20-30% remaining gap in volumes between export and import 2018

Container Throughput - Other ports

2016 2017 (Unlimited capacity depending on barges sourcing ability) High room for growth

4

9M2017 (500k TEUs/year)

600 Land upfront General maintenance CAPEX Remaining Construction (BCDS)

Strictly Private & Confidential Page 21 DOL =

𝑻𝒃𝒎𝒇𝒕 −𝑾𝒃𝒔𝒋𝒃𝒄𝒎𝒇 𝒅𝒑𝒕𝒖 𝑻𝒃𝒎𝒇𝒕 −𝑾𝒃𝒔𝒋𝒃𝒄𝒎𝒇 𝒅𝒑𝒕𝒖 −𝑮𝒋𝒚𝒇𝒆 𝒅𝒑𝒕𝒖

Average outbound volume (1H 2017) : 16,245 TEUs per month Average inbound volume (1H2017): 10,852 TEUs per month LCB Sahathai STT tries to utilize the gap capacity of coastal barge between inbound and out bound volume by selling residual slots on inbound route to other terminals. Starting in 2016, STT mainly sold these available slots to TPT and has been expanding to other terminals

Nature of Thailand is net exporter so there normally are remaining inbound slots

Balancing EXIM volume of coastal barge service Economy of Scale

500 1,000 1,500 2,000 Y0 Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10

Profit

Based on year 2016 actual performance, cost structure

• f STT comprises of fixed cost approx. THB 407 mm (or

40.6%) and variable cost approx. THB 594 mm (or 59.4%). This can be calculated for degree of operation leverage (DOL) of 5.19 times, meaning that every 1% increase in sales will increase EBIT for 5.19%

Cost Revenue

Actual performance of FY2016 as base year Note : Visualization of STT‟s cost structure and relationship with sales for illustration is conducted by treating the actual performance of FY2016 as a base year and simulating sales growth by 5% p.a. Note that some fixed cost might be variable in long term perspective

From the average current EXIM volume, STT can fill up the gap and increase volume of import for 19.9% with slim increase of cost

Fixed cost include land rent, salary, depreciation & amortization and administrative expenses.

Opportunity on increasing profitability

4

THB mm

Strictly Private & Confidential Page 22 Name : Mitsui O.S.K. Lines (“MOL”) /1 Country : Japan (Listed in Tokyo Stock Exchange) Market Cap. : ~USD 3.82 billion

TEUs capacity Carrier Fleet

Strategic Partner Profile

Risk mitigation by business alliance model

5

544 k 78

2.5%

Name : Mediterranean Shipping Company (“MSC”) Country : Switzerland (Non-Listed) Market Cap. : n.a.

Source : Alphaliner Top 100 as of 3 October 2017 Note : 1. To merge with Nippon Yusen Kabushiki Kaisha (NYK Line) and Kawasaki Kisen Kaisha (K Line) in April 2018 to be Ocean Network Express (“ONE”)

• 2. Estimated figure for ONE after merger

Strategic partner formula

Market share World Ranking

11

TEUs capacity Carrier Fleet

3,142 k 511 14.7%

Market share World Ranking

2

Strategic partner formula

 The company partners with variously worldwide shipping companies and is looking for other opportunities in order to expand the business by joint venturing or in any form to set up new companies to support existing operations and possibly diversify to new businesses  Partnership with shipping companies around the world allows the company to initiate new business in recent years. For example, the company can use its container volumes in hands to negotiate with shipping companies in order to obtain freight forward services at low price and desired routes 6.6% /2 6 /2

1,424 k /2 230 /2

Opportunity and Benefits from Strategic/Business Partners

Strictly Private & Confidential

Financial Highlights

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NI (Parent)

Overall performance – Consolidated

Total Revenues (THB million) Profits (THB million)

157 164 236 161 169 124 121 174 125 130 36 27 80 55 39 18.8% 19.5% 21.8% 21.4% 17.1% 14.9% 14.4% 16.1% 16.6% 13.2%

• 3%

2% 7% 12% 17% 22% 50 100 150 200 250 300 2014 2015 2016 9M2016 9M2017

Gross Profit EBITDA % GP (RHS) % EBITDA (RHS)

Total revenues show strongly continuous growth

• Total revenues have been continuously increasing from 2014,

which mainly came from growths in terminal handling operations and in continuous additions of other related businesses

• In 2015, total revenues increased from 2014 as the company

gained new customers for freezone yard and warehouse rental services even its terminal handling performance slightly dropped

• In 2016, total revenues increased from 2015 from growths in

every business segment, mainly coming from organic services and new business entering such as container depot and freight forward services

• In 9M2017, total revenues increased from the same period in

previous year, factoring in BBT‟s operation and continuous growths in every business segment Continuous improvement of Gross profit and EBITDA

• The company shows continuous improvement of gross profit,

EBITDA and net income (except only slight drops in 2015 and 9M2017) along with the growths in revenues

• In 2015, the company saw the improvements in gross profit but

decrease of EBITDA and net profit due to increase of salary expense, maintenance expense from special dredging

• In 2016, gross profit, EBITDA and net profit surged from 2015

due to growths in organic businesses, new high-margin business addition, such as container depot, and reported income tax revenue

• In 9M2017, the company saw improvements in gross profit and

EBITDA but drops in margins due to incompletely full operation of BBT

723 697 921 657 741 48 46 58 33 68 16 46 54 37 74 43 52 47 26 103 200 400 600 800 1,000 1,200 2014 2015 2016 9M2016 9M2017

In-land transportation Warehouse & Yard Terminal Others

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Terminal – Terminal handling (Feeder & Barge)

Revenues (THB million) Container Throughput (’000 TEUs)

241 259 352 253 294 36 40 48 35 33 50 100 150 200 250 300 350 400 2014 2015 2016 9M2016 9M2017

Operation of BBT factors in the performance in 2017

• Revenues from terminal handling business in overall have been increased from 2014 even it displayed slight drop in 2015 due to slight drop of

number of container throughput and some parts of service fee are paid directly by customers to Laemchabang port

• In 2016, the company experienced growth in terminal handling business thanks to an increase of new acquired customers in both internal and
• ther ports while revenues in 9M2017 increased from the same period in previous years, which the operation of BBT, starting in 4Q2016, was

already factored in

• Revenues from feeder segment declined in 9M2017 since some customers changed their mode from feeder too barge while one was merged

with other shipping agents and switched the service to other terminals. Nevertheless, the company already replaced its diminished customers with new ones in late of second quarter of 2017 in which it shall reflect in the company‟s performance thereafter

522 458 545 389 504 154 172 225 162 123 200 400 600 800 1,000 1,200 2014 2015 2016 9M2016 9M2017

Feeder Barge Laden Empty

Remark: Container throughput on the Company, BBT, and service provided to other ports

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Terminal – CFS/LCL & Container Depot

CFS/LCL Container Depot CFS/LCL revenues drop by Feeder’s volumes in 9M2017

• Revenues and number of serviced containers show growth trends

from 2014-2016 as the company had been acquired new customers along the period

• In 9M2017, revenues and number of serviced containers dropped

from the same period in previous year as its one main customer decided to alter the service to other terminals in early of second quarter in 2017. However, the company already replaced its diminished customer with the new ones in late of second quarter in this year One of a business catalyst since 2016

• Being transferred the operational assets from related company,

the company started container depot service in 2Q2016 and immediately recognized revenue of THB 66 million in 2016 while revenues and number of serviced containers in 9M2017 surged from the same period in previous year

• After transferring container depot operation to BCDS, the

company will have more capacity to enhance its growth from the bigger land areas. Otherwise, the existing land areas for current container depot operation in Sahathai shall be used for terminal handling business which it might also increase the capacity for feeder and barge operations

47 67 85 62 47 32 38 45 36 27 5 10 15 20 25 30 35 40 45 50 10 20 30 40 50 60 70 80 90 100 2014 2015 2016 9M2016 9M2017

• No. of Serviced

Containers Revenue

Unit: ’000TEUs Unit: THB million 66 44 68 71 52 91 10 20 30 40 50 60 70 80 90 100 10 20 30 40 50 60 70 80 90 100 2014 2015 2016 9M2016 9M2017

• No. of Serviced

Containers Revenue

Unit: ’000TEUs Unit: THB million

• Not in operation -

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In-land Transportation

High growth due to the expansion of business (Bangkok/Samutprakarn to Laemchabang)

• Revenues from in-land transportation show growth trends from 2014. Nonetheless, in 2015, revenue from in-land transportation slightly

decreased along with number of serviced containers as export volumes of the company‟s customers had declined

• In 3Q2016, the company improved its dropped revenues in previous year by starting providing in-land transportation service through

Bangkok-Lamchabang route, reflecting in growth of total revenue in this segment in 2016 even the number of serviced containers slightly decreased

• In 9M2017, revenues and number of serviced containers surged from the same period in previous year due to its new launched business

plan in 3Q2016 and excess container demands from feeders and barges Revenues (THB million) Serviced Containers (’000 Containers)

11 11 10 9 24 5 10 15 20 25 2014 2015 2016 1H2016 1H2017 48 46 58 33 68 10 20 30 40 50 60 70 80 2014 2015 2016 9M2016 9M2017

Strictly Private & Confidential Page 28 43 52 11 10 10 36 16 99 10 20 30 40 50 60 70 80 90 2014 2015 2016 9M2016 9M2017 16 42 41 28 34 4 13 9 40 10 20 30 40 50 60 70 80 2014 2015 2016 9M2016 9M2017

Warehouse & Yard and Others

Revenues from Warehouse & Yard (THB million) Revenues from Others (THB million)

Warehouse Freezone yard

Promising growth from secured contracts

• Revenue from Warehouse &Yard shows continuous growth from

2014 from the acquisition of long-term contracts with Mercedes on freezone yard service in 2015. In addition, in 2015-2016, the company gained new exported/imported customers for general warehouse service, reflecting in secured revenues in 1-3 years from this service thereafter

• In 9M2017, the company completed a construction of freezone

warehouse and began its service to Mercedes in May 2017 with 4- year contract Key driver from freight forward service

• Most of 2014-2015 are one-time revenues, comprising of storage

management fee collected from the customers in which the service already expired in 1Q2016 and the company would no longer provide such service under the operational restructuring plan

• In 1Q2016, the company initiated freight forward operation with

STS and has been experiencing growth in kind of business due to increasing volumes from the only one customer. In this regard, the company plans to acquire new customers to diversify source

• f income and potentially provide other services to such acquired

customer

Others Freight forward

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Overall Financial Position

Assets, Liabilities and Shareholder’s Equity (THB million) Ratios (Times)

820 1,187 1,650 2,073 647 947 1,286 1,688 173 240 364 385 2.63 2.66 2.14 2.97 3.69 5.29 4.47 6.57* (14) (9) (4) 1 6 500 1,000 1,500 2,000 2,500 3,000 2014 2015 2016 9M2017

Assets Liabilities Shareholder's Equity IBD/Equity IBD/EBITDA

5.0% 2.5% 5.2% 1.6% 17.5% 11.8% 13.9% 8.6% 23.1% 12.0% 24.4% 7.7%

• 10%
• 5%

0% 5% 10% 15% 20% 25% 30% 2014 2015 2016 9M2017* ROA ROFA ROE

Key ratios temporarily drop in 2017

• In 9M2017, the company‟s net profit dropped since land rentals in

some leased areas increase as per rental agreement. In addition, the company consolidated fixed cost and SG&A increased as BBT had been incompletely operating in full capacity, also reflecting in drop of ROA and ROFA ratios. Nevertheless, from 3Q2017 onwards, after obtaining ICD license, it is expected that BBT will be able to begin running its operation with increasingly utilized capacity and its improved performance will factor in improved consolidated net profit thereafter Significant increase in fixed assets from high capital expenditure

• The company‟s fixed assets significantly increased from THB

1,187 million in 2015 to THB 1,650 million in 2016 from new purchase of lands and operating cranes, and amelioration of container yards in Sahathai and BBT. The fixed assets were mainly financed by long-term loans from financial institutions

• Total interest bearing debts to Equity ratios dropped in 2016 due

to the company‟s increased performance and increased in 9M2017 as the company drew significant amount of loans from shareholders for Container Depot project in BCDS

Note: * Annualized EBITDA to calculate IBD/EBITDA ratio for 9M2017 Note: * Annualized net profit to calculate key ratios for 9M2017

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Profit Break Down

Company 2016 2017 Q1 Q2 Q3 Q4 FY 16 Q1 Q2 Q3 9M17 PORT 18.44 23.39 22.40 30.92 95.16 21.58 12.38 26.82 60.78 BBT (Only PORT‟s portion) (0.81) (0.83) (1.44) (3.40) (6.48) (6.04) (5.29) (6.81) (18.15) BBS (Only PORT‟s portion)

• (0.15)

(0.06) (0.22) (0.45) (0.66) (0.61) (1.72) Consolidate Elimination Adjustment (1.50) (2.44) (2.48) (2.19) (8.61) 0.00 (0.03) (1.78) (1.81) Total Profit for PORT shareholder 16.13 20.13 18.32 25.26 79.85 15.09 6.40 17.61 39.10