Asian Seafoods Coldstorage PLC. Q2 Opportunity Day 08 th Aug 18 - - PowerPoint PPT Presentation

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FROZEN BUSINESS TUNA BUSINESS PETFOOD BUSINESS FEED BUSINESS DISTRIBUTION BUSINESS

Asian Seafoods Coldstorage PLC.

Q2 Opportunity Day–08th Aug 18

Disclaimer

This presentation includes forward-looking statements and numbers that are subject to risks and uncertainties including, in particular, statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. ASIAN, Asian Seafoods Coldstorage PLC., based these forward-looking statements on its views with respect to future events and financial performance. Actual performance described herein could differ materially, better or worse, from that projected in the forward-looking statement due to the inherent uncertainty of estimates, forecasts and projections. Readers should not put undue reliance on any forward-looking statements. Forward-looking statements represent estimates and assumptions only as of the date that they were

• made. The information contained in this presentation is subject to change without notice and ASIAN

does not undertake any duty to update the forward-looking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations.

2

Q2 Opportunity Day–08th Aug 18

ASIAN Overview ASIAN Key Financial ASIAN Development by Segment ASIAN Strategies Updated ASIAN 2018 Target

Agenda

3

Q2 Opportunity Day–08th Aug 18

ASIAN OVERVIEW

Asian Seafoods Coldstorage Public Company Limited & its Subsidiaries

Asian Business

Frozen Business Tuna Business Pet Food Business Aquaculture Feed Business Distribution Business

Asian Seafoods Coldstorage PLC. Asian Seafoods Coldstorage (Suratthani) Co., Ltd. Asian Feed Co., Ltd. Asian Food Co., Ltd. Asian Alliance International Co., Ltd. Asian Alliance International Co., Ltd.

4.1 billion baht 1.1 billion baht 2.7 billion baht 1.5 billion baht 0.7 billion baht 2017 Business Size

5

Growth : -12% YoY Growth : -19% YoY Growth : +69% YoY Growth : +25% YoY Growth : +6% YoY

Asian Seafoods Coldstorage PLC.

Q2 Opportunity Day–08th Aug 18

ASIAN’s Sustainability

• Product Quality and Services
• Human Development and Human Value
• Commit avoiding to involve in illegal fishing, procuring,

importing, exporting, transiting and distributing aquatic life and products obtained from illegal fishing and labor, and human trafficking.

• Anti-Corruption Policy

6

Q2 Opportunity Day–08th Aug 18

2006

• Acquired Asian

Feed Co., Ltd., diversify into Shrimp Feed Business

2010s 2015s 2016s

1964

Starting Business in Frozen Food

1993

• Founded Asian

Seafoods Coldstorage (Suratthani) Co., Ltd. In order to expand Frozen Food Business

1994

• Registered Asian

Seafoods Coldstorage PLC.

2005

• Founded Asian

Alliance International Co., Ltd., diversify into Tuna Business

2012

• Founded Asian Food

Co., Ltd., domestic trader company of the group

• EMS Outbreak in

Shrimp

• Asian Feed invested

in Extruder to diversify into Fish Feed Business

2013

• AAI invested in

Premium Pet Food Line

2015

• Quadruple Growth

in Pet Food

• Turnaround of

Asian Feed Co., Ltd.

2016

• Implement ERP
• Sustainable

sourcing & Good Labor Practice

• Established

Nutrition Database in Pet Food & Feed

• Ambition 2020

were set

2018s

Major Events

7

2017

• Expand Pet

Food Capacity

• Rapid Growth in

Pet food & Aqua Feed

• Launch concept

“Closer to consumer and efficiency” and set up strategies.

2018

• Founded Asian

Group Services Co., Ltd.

• Invest in Asian

Group SCS Europe GmbH

• Invest in Inter

Petrina Co., Ltd. for “Maria” brand.

Q2 Opportunity Day–08th Aug 18

ASIAN Key Financial

Asian Seafoods Coldstorage Public Company Limited & its Subsidiaries

Q2/18 Highlights

• Sales revenues increased 1.5% y.o.y. to

2,316 million at lower volumes, mainly due to lower Aquafeed volumes. Petfood volumes were up

• Gross Profit margin was 11.8% versus

10.2% in the same quarter last year. Margins in Frozen and Petfood improved Q.o.Q due to better prices and FX effects

• Net profit in Q2/18 was 92 million baht,

in line with the same period last year

• Joint-ventures

were concluded in Germany and Thailand for the marketing and sales of Petfood

• First

exports

• f

frozen processed Barramundi

9 ('000'000 Baht) Q2 2017 Q2 2018 Q1 2018 Sales 2,283 2,316 2,300 Gross Profit 234 273 139 SG&A (137) (168) (140) EBIT from Operation 97 104 (1) Other Incom 20 18 48 fxGain (loss) 8 (5) 21 Non-recurring (2) EBIT 125 116 69 Financial Cost (32) (35) (33) EBT 93 81 35 Taxes 1 12 (9) Net Profit 94 92 27

Profitability Analysis

Q2 Opportunity Day–08th Aug 18

Q2/18 Sales

10

• Overall volumes in Q2 decreased 9% y.o.y. which was a result of lower Feed and

Distribution volumes which were partly offset by higher Petfood volumes and slightly higher Tuna volumes. Aquaculture.

• Sales Revenues in Q2 increased 1.5% compared to the same quarter a year ago

(excluding intracompany transactions).

• The USD increased more than 6% during the quarter, which returned higher

prices in baht for all USD denominated sales.

* Volumes include inter company transaction

Q2 Opportunity Day–08th Aug 18

Q2/18 Profitability

11

• Gross Profit margin was 11.8 %

versus 10.2% in the same quarter last year.

• Net profit in Q2/18 was 92 million

baht, in line with the same period last year (net profit 94 million baht)

Q2 Opportunity Day–08th Aug 18

Q2/18 Working Capital

12

*Net WC Days = AR Days + INV Days – AP Days **ROE= last 4 quarter net profit/Average total shareholders’ equity

Q2 Opportunity Day–08th Aug 18

Leverage &Debt Structure

13

• Balance sheet ratios

a bit improved.

• Long term Loan

improved as planned

Q2 Opportunity Day–08th Aug 18

ASIAN Development by Segment

Asian Seafoods Coldstorage Public Company Limited & its Subsidiaries

Frozen Business

Frozen Business of Asian Group comprises of 3 plants

• Asian Seafoods Coldstorage

Public Company Limited (Klongtoey) capacity of 2,400 tons finished product per year

• Asian Seafoods Coldstorage

Public Company Limited (Samutsakorn) capacity of 14,000 tons finished product per year

• Asian Seafoods Coldstorage

(Suratthani) Company Limited Capacity of 10,000 tons finished product per year

Frozen Business

16

Q2 Opportunity Day–08th Aug 18

Frozen Performance

17

• Sales volumes for the quarter were overall stable y.o.y. but sales revenues decreased 7%

to 904 million baht.

• Squid volumes were slower compared to the same period last year, and at lower prices.

Margins improved, compare to the previous two quarters, as a result of slightly lower raw material price due to market mechanism and inventory write-downs taken previously.

• Shrimp volume in Q2 increased y.o.y. but trading at significantly lower prices compared to a

year ago. Profit margins were however better than in Q1 as a result of a better product/market mix and lower processing cost.

• Optimizing coldstorage capacity has yielded cost savings in the course of Q2.

* Volumes include inter company transaction

Q2 Opportunity Day–08th Aug 18

• More focus on China market
• Increase fish processing and product development
• Further strengthen squid brand Asian Surat
• Cost restructuring
• A comprehensive cost rationalisation project among the three

processing plants has been initiated and is expected to show an improved cost structure in the course of Q3

• Rationalisation of cold storage facilities in the course of Q2

Frozen Actions

18

Q2 Opportunity Day–08th Aug 18

Tuna Business

Tuna Business

• Operated by Asian Alliance

International Co., Ltd., located in Samutsakorn province w/ quite new facilities compare to others.

• Traditional tuna product in cans and

pouches, and Value added product (ready-to-eat) such as Tuna with rice meal.

• No branded, more flexible in tuna

high price seasons.

• Capacity of around 17,500 tons of

finished product per year.

20

Q2 Opportunity Day–08th Aug 18

Tuna Performance

21

• Canned Tuna volumes and sales revenues were up y.o.y.

amounting to 244 million baht.

• This was partly due to the strengthening of the USD during the
• quarter. Profit margin improved.

* Volumes include inter company transaction

Q2 Opportunity Day–08th Aug 18

Petfood Business

Petfood Business

• Also operate by Asian Alliance

International Co., Ltd.

• Serve as a “co-developer” who

understand customers and provide ideas for new products in variety of packaging.

• Target premium brand owners and

private labels showing continued growth.

• Process Fishmeal using non-IUU by-

products which benefit shrimp products traceability.

• Annual production capacity of

38,000 tons of FG (net weight)

23

Q2 Opportunity Day–08th Aug 18

• Sales revenues were up to 811 million baht, a 24% increase compared to the same quarter

last year.

• Volume increased 18% and higher prices due to USD exchange rate effects and product

mix.

• Volume mainly increased with customers in the premium market segment, both by organic

growth of individual customers and by increase of our share of supply to larger customers.

• The tender of the construction of an automatic warehouse is partly concluded and

construction will start in Q3.

Petfood Performance

24

* Volumes include inter company transaction

Q2 Opportunity Day–08th Aug 18

Aquaculture Feed Business

Aquaculture Feed Business

26

• Asian

Feed Co., Ltd. located in Petchaburi. Production capacity

• f

60,000 tons of sinking pellet and 36,000 tons of floating pellet per year

• Farm research facilities in Suratthani for

both product quality and new farm model test.

• Advanced laboratory & academic expertise to provide water quality analysis

inspection, aquatic animal quality evaluation, food quality development, technique advisory for rearing and solution for diseases in aquatic animals.

Q2 Opportunity Day–08th Aug 18

Aquaculture feed Performance

27

• The strong performance of the previous year could not be maintained in Q2 and

volumes and sales revenues declined with 24% and 22% respectively, with lower sales both in shrimp feed and fish feed.

• Profit margins declined, due to temporary price reduction due to an industry wide

support package to farmers, who suffered a significant drop in shrimp prices.

* Volumes include inter company transaction

Q2 Opportunity Day–08th Aug 18

Distribution Business

Distribution Business

• Asian Food Co., Ltd. engages in

imported frozen food products and delivered to Thai wholesalers, modern retail and restaurant chains.

• Our cold storage in Bangkok and

Samutsakorn are also the hub for

• ur food distribution business.

29

Q2 Opportunity Day–08th Aug 18

Distribution Performance

• Sales revenues decreased, however, profitability was satisfactory.

30

Q2 Opportunity Day–08th Aug 18

ASIAN Strategies Updated

Asian Seafoods Coldstorage Public Company Limited & Its Subsidiaries

Sales (Billion baht) 2015 2017 Key Strategy/Success 2020 Target Frozen 3.6 4.1 Shrimp & VAP 6.0 Tuna 1.2 1.1 VAP 1.5 Pet Food 1.6 2.7 Co-Developer, Customer Relation 4.0 Feed 1.1 1.5 Sustainability, Fishmeal Substitution, Dryfeed 2.0 Distribution 0.4 0.7 Acquisition 1.0 Total ASIAN 7.9 9.7 14.5 Inter-company sales (0.2) (0.4) Consolidated GP 8.2%* 10.5% 10.0-12.0%

*2015 GP excluding Fx Benefit

Ambition 2020

32

Q2 Opportunity Day–08th Aug 18

33

“Closer to consumer and efficiency”

Growth Profit Stability

Customers Quality Capital

Diversification

Policies

Efficiency Brands Sourcing

People Partners

Key Strategies for 2018-2022

Q2 Opportunity Day–08th Aug 18

34

Strategic Actions

Q1 Opportunity Day–23rd May 2018

• Marketing and Sales joint ventures in Europe and Thailand established,

first customers acquired

• Petfood brand development: “Maria” launched in Thailand, brand for

China to be introduced in Q3

• Asian Seabass launched with initial sales to north America
• Automated warehouse capex around 250m baht
• Marketing team established.

ASIAN 2018 Target

Asian Seafoods Coldstorage Public Company Limited & Its Subsidiaries

2018 Target Update

35

Sales (Billion Baht)* 2017 2018 Target %Growth 2018 Target Updated %Growth

Frozen 4.1 4.6 13% 4.2 3% Tuna 1.1 1.1 0% 1.1 0% Pet Food 2.7 3.2 21% 3.4 30% Aqua Feed 1.5 1.9 27% 1.4

• 6%

Distribution 0.7 0.6

• 10%

0.6

• 10%

Inter-company sales (0.4) (0.3) (0.2) Total Asian Group 9.7 11.2 15% 10.6 10% Consolidate GP 10.5% 10%-10.5% 9.5%-10% *Actual sales revenue by business segment partly include inter-company sales

Q2 Opportunity Day–08th Aug 18

2018 Target Update

36

S a le s (B illio n B a h t)* 2 1 7 Y T D 2 1 8 A d j .T a r g e t p r

• g

r e ss F r

• z

e n 4 .1 1 .8 4 .2 4 3 % T u n a 1 .1 .5 1 .1 4 9 % P e t F

• d

2 .7 1 .6 3 .5 4 5 % A q u a F e e d 1 .5 .5 1 .4 3 6 % D ir tr ib u tio n .7 .3 .6 4 5 % In te r-c

• m

p a n y sa le s (0 .4 )

.1 (0 .2 ) T

• ta

l A sia n G r

• u

p 9 .7 4 .6 1 .6 4 4 % C

• n

so lid a te G P 1 .5 % 9 .5 %

• 1

%

* A c tu a l s a le s r e v e n u e b y b u s in e s s s e g m e n t p a r tly in c lu d e in te r

• c
• m

p a n y s a le s

Q2 Opportunity Day–08th Aug 18

• 2018 growth expected to be 10%, the lower growth rate mainly due to lower shrimp

price, slow squid market and strong competition in feed business.

• Sales Revenue target for the year is now 10.6 billion baht with gross profit margin

around 9.5-10%

Thanks!

Any questions?

Investor Relations Contact Email: Asian-secretary@asianseafoods.co.th Tel: (66) 034-845575-91 ext. 5370 Presentation is available at www.asianseafoods.co.th

Appendix

Asian Seafoods Coldstorage Public Company Limited & Its Subsidiaries

Management Team

Mr.Somsak Amorrattanachaikul Chief Executive Officer Mr.Somchai Amorrattanachaikul Senior Managing Director Mr.Suriya Prasatbuntitya Executive Vice President Mr.Hendrikus (Rik) Van Westendorp Executive Vice President & Chief Financial officer Mr.Aekarat Punnasung MD-Asian Alliance Mrs.Suree Jangsawat MD-Asian Surat Mr.Wallop Lomlimp MD-Asian and Asian Feed

A-1

Q2 Opportunity Day–08th Aug 18

Q2/2018 Income Statement

A-2

Unit ('000) Q2-2017 % to Sales Q2-2018 % to Sales YTD 2017 % to Sales YTD 2018 % to Sales Sales 2,280,687 99.9% 2,311,767 99.8% 4,760,952 99.9% 4,610,286 99.9% Cold storage service income 1,837 0.1% 4,166 0.2% 3,932 0.1% 5,662 0.1% Cost of Sale and service (2,048,681)

• 89.8%

(2,043,421)

• 88.2% (4,228,782)
• 88.7% (4,204,417)
• 91.1%

Gross Profit 233,843 10.2% 272,512 11.8% 536,102 11.3% 411,531 8.9% Other income 28,167 1.2% 13,655 0.6% 65,080 1.4% 83,027 1.8% SG&A expenses (136,639)

• 6.0%

(168,145)

• 7.3%

(337,614)

• 7.1%

(307,790)

• 6.7%

Share of loss from JV (2,328) (2,328) EBIT 125,371 5.5% 115,694 5.0% 263,568 5.5% 184,440 4.0% Finance cost (32,280)

• 1.4%

(34,919)

• 1.5%

(64,661)

• 1.4%

(68,323)

• 1.5%

EBT 93,091 4.1% 80,775 3.5% 198,907 4.2% 116,117 2.5% Income tax expenses 1,300 0.1% 11,550 0.5% 1,296 0.0% 2,786 0.1% Profit for the year 94,391 2.0% 92,325 2.0% 200,203 4.3% 118,903 2.6% Earning per share 0.17 0.17 0.37 0.22

Q2 Opportunity Day–08th Aug 18

Q2/2018 Statement of Financial Position

A-3

Unit ('000 baht) Q2-2018 % to Total Asset 2017 % to Total Asset Change Current Asset Cash and cash equivalents 50,643 0.74% 38,640 0.57% 31.06% Trade and other receivables 1,279,922 18.80% 1,190,890 17.49% 7.48% Inventories 2,548,805 37.44% 2,682,146 39.38%

• 4.97%

Other current assets 58,942 0.87% 36,369 0.53% 62.07% Total current assets 3,938,312 57.85% 3,948,045 57.97%

• 0.25%

Non-Current assets Investment in JV 1,283 Investment properties 40,301 0.59% 40,301 0.59% 0.00% Property, plant and equipment 2,674,221 39.28% 2,659,560 39.05% 0.55% Other non-current assets 153,133 2.25% 162,777 2.39%

• 5.92%

Total non-current assets 2,868,938 42.15% 2,862,638 42.03% 0.22% Total assets 6,807,250 100.00% 6,810,683 100.00%

• 0.05%

Current Liabilities Bank overdrafts and short-term loans from banks 1,175,372 17.27% 1,284,125 18.85%

• 8.47%

Trade and other payables 604,333 8.88% 608,936 8.94%

• 0.76%

Current long-term loans and lease liabilities 778,034 11.43% 869,331 12.76%

• 10.50%

Other current liabilities 38,220 0.56% 46,586 0.68%

• 17.96%

Total current liabilities 2,595,959 38.14% 2,808,978 41.24%

• 7.58%

Non-current liabilities Long-term loans 1,521,302 22.35% 1,289,236 18.93% 18.00% Long-term debentures

• 0.00% -

0.00% n/a Finance lease liabilities 1,040 0.02% 1,432 0.02%

• 27.37%

Other non-current liabilities 167,130 2.46% 172,447 2.53%

• 3.08%

Total non-current liabilities 1,689,472 24.82% 1,463,115 21.48% 15.47% Total liabilities 4,285,431 62.95% 4,272,093 62.73% 0.31% Total shareholders' equity 2,521,819 37.05% 2,538,591 37.27%

• 0.66%

Total liabilities and shareholders' equity 6,807,250 100.00% 6,810,683 100.00%

• 0.05%

Q2 Opportunity Day–08th Aug 18

Q2/2018 Statement of Cash Flow

A-4

Units: (‘000 baht) 6mth 2018 6mth 2017 Change 116,117 198,907

• 82,790

Depreciation & Amortisation 95,772 91,253 4,519 Other adjustments to reconcile profit (loss) before tax to net cash

• 27,750

18,973

• 46,723

Loss (gain) on exchange rate 22,517

• 13,177

35,694 Interest expense (income) 67,404 62,247 5,157 274,060 358,203

• 84,143

Decrease (increase) in operating assets 78,717

• 393,806

472,523 Increase (decrease) in operating liabilities

• 22,020

9,228

• 31,248

330,757

• 26,375

357,132 Cash paid for interest

• 70,187
• 64,569
• 5,618

Cash paid for income tax

• 5,318
• 2,809
• 2509

Cash received from witholding income tax 5,732 260,984

• 93,753

354,737

• 109,069
• 63,637
• 45,432
• 139,912

147,447

• 287,359

12,003

• 9,943

21,946 Cash and cash equivalents at beginning of period 38,640 66,510

• 27,870

50,643 56,567

• 5,924

Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at end of period Profit (loss) before tax Profit from operating activities before changes in operating assets and liabilities Cash from (used in) operating activities Net cash from (used in) operating activities Net cash from (used in) investing activities Net cash from (used in) financing activities

Q2 Opportunity Day–08th Aug 18