Diamond Building Products PCL Corporate Presentation: Year 2014 - - PowerPoint PPT Presentation

Diamond Building Products PCL

Corporate Presentation: Year 2014 Performance

Opportunity Day On Thursday 19 March 2015 at 09.00 – 10.00 at SET 1101 Room (11th floor.)

Disclaimer

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Note: All currency figures within this presentation are presented in Thai Baht (“Bt.”) unless otherwise stated.

• The information contained in this presentation is for information purposes only and does not constitute an offer or invitation to sell
• r the solicitation of an offer or invitation to purchase or subscribe for share in Diamond Building Products Public Company Limited

(“DRT” and shares in DRT, “shares”) in any jurisdiction nor should it or any part of it form the basis of, or be relied upon in any connection with, any contract or commitment whatsoever.

• 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 DRT operates and general achievement of DRT business forecasts, which will cause the actual results, performance or achievements of DRT to differ, perhaps materially, from the results, performance or achievements expressed or implied in this presentation.

• This presentation has been prepared by the DRT. 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 DRT or any of its agents or advisers,

• r any of their respective affiliates, advisers 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 is made, furnished and distributed for information purposes only. No part of this presentation shall be relied

upon directly or indirectly for any investment decision-making or for any other purposes.

• This presentation and all other information, materials or documents provided in connection therewith, shall not, either in whole or

in part, be reproduced, redistributed or made available to any other person, save in strict compliance with all applicable laws.

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AGENDA

• Company Overview
• Financial Performance
• Business Expansion
• Appendix

Company Overview

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Business Overview

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• Founded in 1985, DRT is one of the top 3

manufacturers and distributors

• f

roofing products in Thailand.

• DRT’s core products includes tiles, boards &

ceilings, siding boards, roof accessories, and some non-roofing products.

• DRT mainly distributes its products through agents

(mom&pop shops) and modern trade nationwide.

• DRT has continued to grow through product

improvement and development and gradual production expansion.

• DRT is listed on the Stock Exchange of Thailand

(SET) with a market capitalization of approximately

• Bt. 5,219 million/1.

Construction materials market share /2

Siam Cement Group 46% Mahaphant Group 23% DRT 15% Kiternit Group 6% Others 10% Source:

• 1. www.set.or.th as of March 10, 2015.
• 2. Ministry of Commerce. Based on FY2013 sales value.

Milestones

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1985 - 1999 2000 - 2009

1985 Established under the name Siam City Tiles and Pipes Co., Ltd. 2001 Changed the name to Diamond Roofing Tiles Co., Ltd. 2002 Myriad Materials Co., Ltd became a major shareholder 2005 Listed on the Stock Exchange of Thailand (SET) 2006 Launched its first non-asbestos tile “Jearanai Tile” 2012 Launched its first non-asbestos fibre cement tile 2013

• Established its firstly owned distribution center

(DC), located in Khon Kean

• Acquired an autoclaved aerated concrete (AAC)

plant in Chiangmai

• Launched a new production line of autoclaved

aerated concrete (AAC) in Saraburi

Strategic Shareholders

7

Established in 2002 as a holding company to acquire DRT from the previous owner – Siam City Cement Plc.(SCCC)., Myriad Materials is a major shareholder of DRT, having Srivikorn Family and Pradipasen Family as major shareholders. As entrepreneurs of various businesses with long and successful records, the families bring to DRT business know-how’s and expertise in construction and property development markets.

Source: Company estimates as of March 12, 2015.

Myriad Materials 60% Srivikorn and Pradipasen Families & Management 4% Free-float 36% Foreign Institutions 5% Thai Institutions 32% Thai Individuals 63%

Totaling 64%

Production Base

8

Source: Company estimate as at March 10, 2015.

Existing production facilities Future production facilities Existing distribution center (DC)

Chiangmai

Capacity: 50,000 ton/yr Product:

• Autoclaved aerated

concrete (AAC)

Saraburi

Capacity: 892,000 ton/yr Product:

• Tiles
• Board and ceiling
• Siding board
• Autoclaved aerated

concrete (AAC)

Khon Kean

Capacity : 40,000 ton/yr Product:

• Tiles

Suratthani

Distribution Center, Khon Kean

Total Capacity FY2014: 982,000 ton/yr

Strategies Behind Our Success

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Product variety & differentiation Strong relationship with distributors Excellent services Prudent financial policies Strong brand awareness

Product delivery with 24 hours with regular training on product handling and safety Strong balance sheet yielding financial flexibility

Extensive distribution network

Over 6,000 nationwide agents and modern trade specialties with growing exporting channel With the main focus in consumer’s needs and satisfaction, product variety and differentiation as well as value for money are keys to retain and enhance market base.

Product and Service Segmentation

10 Tiles Board and ceiling

Gran Onda, Adamas, Roman tiles, Small corrugated tile, Jatulon Board, Flat sheet, Gypsum, Diamond wall, Autoclaved aerated concrete (AAC)

Note: 1. Percentage based on FY2014 revenues from sales and services.

Siding board Special products

Siding and Synthetic wood Roof equipment, Foil, Roof paint, Ultra Truss, Granito, Ceramic roof, Metal sheet, Paint

Services

Roof stripping and installation Re-roofing

Sales of Products 92% Service income 8%

Distribution Channels

11

14% Modern Trade

Leading construction materials and home improvement specialty stores

15% Export

To 9 Destinations in Asia Region

11% Projects

Direct sales to leading residential developers:

• Land & House
• Pruksa
• Supalai
• Sansiri
• Asia Property
• Prinsiri
• Golden Residence

Note: Percentage based on value of FY2014 sales.

Laos Vietnam Cambodia China Myanmar India Taiwan Philippines Malaysia

Agent (mom&pop )

60%

Agent (mom&pop )

FY2013 10% 64% 14% 12%

Logistic System and Trainings

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Service excellence with timely product delivery and training assistance

• Integrated system linking production, inventory, purchase order, and logistics
• Reliable product delivery within 24 hours
• Full fleet of product delivery via trailers, trucks and overseas shipping
• Free trainings for contractors’ employees on product handling & safety precautious
• Assistance on logistics & products storage

Trailers Trucks Shipping

Diamond … A Trusted Brand

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Diamond Brand has been known as a high quality tile for nearly 30 years. Through its consistently seeking customer feedback and continuous product development,

Diamond Brand is now one of the Thailand’s most trusted brands in tile/1.

Source: “BrandAge” Magazine dated January 2012.

Over decades, DRT has marketed its products through traditional dealers (mom and pop shops). Its strong and aged relationship with these distributors nationwide is one of DRT’s competitive advantages and part of DRT’s continued success.

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Distributor … A Strategic Arm

Prudent Financial Policy

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Stable growth with strong balance sheet

0.13 0.05 0.03 0.18 0.23 0.07 0.29 0.39 0.62 0.53 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Net interest-bearing debt to equity

Low level of debt to equity allowing financial flexibility

2,063 2,386 2,590 2,500 2,789 3,325 3,707 3,896 4,429 4,250 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Total revenues (Bt.mil) /1

Note: 1. Excludes non-recurring items and includes other income, gains on FX rate, and gains on sales of assets classified as hold for sale.

Financial Performance

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2,789 3,325 3,707 3,896 4,429 4,250 612 782 864 869 901 747 376 453 459 502 451 289 1,000 2,000 3,000 4,000 5,000 2009 2010 2011 2012 2013 2014

• Bt. million

Total revenues EBITDA Net profit

Financial Highlights

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Excludes non-recurring items. Note: 1. Include other income, gains on FX rate, and gains on sales of assets classified as hold for sale.

/1

% YoY Growth 2009 2010 2011 2012 2013 2014 Total revenues 12% 19% 11% 5% 14% (4%) EBITDA 21% 28% 11% 1% 4% (17%) Net profit 32% 20% 2% 9% (10%) (36%)

/1

FY2014 Net Profit analysis

• FY2014 Net Profit decreased 36% YoY, due to the fact that

Thailand was still faced with political problem during year 2014 and the slump in prices of agricultural products resulting in significant deceleration in consumer spending, particularly in the agricultural sector in the provincial areas where their purchasing power have been reduced. In addition, price competition has become intense resulting in a significant decline in the Corporate Group’s profit.

Sales Volume Breakdown

20 YoY 3% QoQ 4% FY2014 Sales volume analysis

• FY2014 Revenues from sales increased 3% YoY, due

to the increase in sales proportion of autoclaved aerated concrete blocks but the decrease in fiber cement roof tiles.

• 4Q14 Revenues from sales decreased 4% QoQ, due

to the decrease in sales proportion of fiber cement roof tiles and Concrete Tiles.

217,761 218,413 199,276 190,523 799,600 825,973 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000 1Q14 2Q14 3Q14 4Q14 FY2013 FY2014 Unit : Tons Tiles Board & ceilings Siding boards Special products Other products

Tiles 64% Board & ceilings 22% Siding boards 8% Special products 0% Other products 6%

FY2014 Revenues breakdown

Revenues from Sales and Service

21 YoY 4% QoQ 8% FY2014 Total revenues analysis

• FY2014 Revenues from sales and Service decreased

4% YoY, due to the decrease in revenues from sales

• f fiber cement roof tiles and autoclaved aerated

concrete blocks caused by less purchasing power and fierce pricing competition.

• 4Q14 Revenues from sales and Service decreased

8% QoQ, due to the decrease in sales proportion of fiber cement roof tiles and Concrete Tiles.

1,152 1,160 1,000 916 4,402 4,228 1,000 2,000 3,000 4,000 5,000 1Q14 2Q14 3Q14 4Q14 FY2013 FY2014

• Bt. million

Tiles Board & ceilings Siding boards Special products Other products Service

Tiles 52% Board & ceilings 14% Siding boards 16% Special products 7% Other products 3% Service 8%

FY2014 Revenues breakdown

Raw materials 53% Utilities 8% 8% Labour 2% Services 12% 6% 5% Others 6%

FY2014 Costs breakdown

Depreciation maintenance Permanent labour

Costs of Sale and Service Breakdown

22 YoY 1% QoQ 8%

848 869 780 716 3,231 3,213 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 1Q14 2Q14 3Q14 4Q14 FY2013 FY2014

• Bt. million

Raw materials Utilities Depreciation Labour Services Permanent labour maintenance Others Total

FY2014 Costs analysis

• FY2014 Costs of sales and Service decreased 1% YoY, due to the

increase in sales volume of 3% and increase in depreciation of assets of 3% but decrease in cost of service of 7%.

• 4Q14 Costs of sales and Service decreased 8% QoQ, due to the

decrease in sales volume of 4% and decrease in cost of service

• f 11%.

Costs 1Q14 2Q14 3Q14 4Q14 FY2013 FY2014 Variable costs 70% 70% 69% 66% 70% 69% Fixed costs 18% 19% 19% 23% 18% 19% Service costs 12% 11% 12% 11% 12% 12%

SG&A Expenses

23 YoY 5% QoQ 11% FY2014 SG&A analysis

• FY2014 SG&A expenses increased 5% YoY, due to the

increase in marketing and sales promotion expenses.

• 4Q14 SG&A expenses increased 11% QoQ, due to the

increase in marketing and sales promotion expenses.

• .

146 153 153 170 591 622 50 100 150 200 250 300 350 400 450 500 550 600 650 700 1Q14 2Q14 3Q14 4Q14 FY2013 FY2014

• Bt. million

Personnel Promotion Packaging Others

Personnel 39% Promotion 20% Packaging 9% Others 32%

FY2014 SG&A breakdown

Profit Margins

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Excludes non-recurring items. Note: 1. Includes revenues from services and other income.

YoY 13% QoQ 9% YoY 36% QoQ 65% YoY 17% QoQ 25% Gross Profit EBITDA Net Profit

/1 /1

304 291 220 200 1,171 1,015 26% 25% 22% 21% 26% 24% 35% 35% 34% 32% 36% 34% 26% 22% 20% 20% 25% 22%

• 10%

0% 10% 20% 30% 40% 50% 200 400 600 800 1,000 1,200 1,400 1,600 1,800 1Q14 2Q14 3Q14 4Q14 FY2013 FY2014 % Margin

• Bt. million

Gross Profit

Gross profit (LHS) GP Margin GP Margin-Asbestos GP Margin-Non-asbestos 243 226 159 119 901 747 120 103 49 17 451 289 21% 19% 16% 13% 20% 18% 10% 9% 5% 2% 10% 7%

• 10%

0% 10% 20% 30% 200 400 600 800 1,000 1Q14 2Q14 3Q14 4Q14 FY2013 FY2014 % Margin

• Bt. million

EBITDA and Net Profit

EBITDA Net Profit EBITDA Margin/1 Net profit Margin/1

Cash Flows

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376 453 460 502 451 289 586 601 326 690 459 688 113 125 99 75 170 250 4 9 12 7 42 50 242 320 362 412 415 346

100 200 300 400 500 600 700 800 900 1,000 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014

• Bt. million

Net Profit CFO Repayment Long Term Interest paid Dividends paid

FY2014 cash flows analysis

• FY2014, ถึงแม้บริษัทฯ จะมีก ำไรสุทธิ 289 ล้ำนบำท แต่

บริษัทฯ ยังมีสภำพคล่อง มีกระแสเงินสดจำกกำรด ำเนินงำน 688 ล้ำนบำท ซึ่งเพียงพอต่อกำรจ่ำยช ำระเงินกู้ระยะยำว เงิน ปันผล และดอกเบี้ยจ่ำย

Capital Structure

26 FY2014 debt analysis

• As at end of FY2014, net interest-bearing

debt to equity was 0.53 times, which is slightly decreased from end of the previous quarter.

Long- term 34% Short- term 66%

Interest bearing debt Bt. 1,212 million

Average interest rate of 3.86% p.a. as follows

• Fixed interest rate of 3.67- 5.10 % p.a.
• Floating interest rate of 2.17-2.45% p.a.

44 42 57 22 57 59 50 64 28 14 305 409 192 610 930 1,486 1,305 1,288 1,163 1,212 1,482 1,595 1,859 2,047 2,214 2,300 2,420 2,335 2,227 2,245 0.18 0.23 0.07 0.29 0.39 0.62 0.52 0.52 0.51 0.53

0.00 0.20 0.40 0.60 0.80 500 1,000 1,500 2,000 2,500 3,000 3,500 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 1Q14 2Q14 3Q14 4Q14

Times

• Bt. million

Cash & current investment Interest bearing debts Equity Net D/E

Fixed 67% 33% Floating

Share Information and Dividend

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Source: www.set.or.th as of March 10, 2015.

Dividend policy is not less than 50% of normal net profit

Par value: Bt.1.00 Listed share: 1,048 million shares Market capitalization: Bt.5,219 million Foreign limit: 49.00%

Share information

Stock price : Bt.4.98 per share P/E 18.04 Times P/BV 2.33 Times Dividend yield 5.42%

0.29 0.39 0.47 0.46 0.53 0.43 0.29 0.25 0.30 0.36 0.38 0.40 0.38 0.27 86% 77% 77% 83% 75% 88% 93% 0% 20% 40% 60% 80% 100% 0.0 0.2 0.4 0.6 0.8 1.0

2008 2009 2010 2011 2012 2013 2014

% Tons per year EPS DPS Dividend payout (RHS)

Income Statements

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P&L Highlight (in Bt.million) FY2014 FY2013 % change REVENUES Revenues from sales and services 4,228 4,402

• 4.0%

Other incomes 22 27

• 18.4%

Total revenues 4,250 4,429

• 4.0%

COSTS Costs of sales and services 3,213 3,231

• 0.6%

Other costs

• 0.0%

Total costs 3,213 3,231

• 0.6%

Selling and administrative expenses 622 591 5.2% Operating profit 415 607

• 31.6%

Finance costs 51 43 16.6% Income tax 75 113

• 33.2%

Net profit 289 451

• 35.8%

Balance Sheets

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Balance Sheet (in Bt.million) Dec 31, 2014 Dec 31, 2013 % change Assets Cash & cash equivalents 14 59

• 76.9%

Trade & account receivables 523 570

• 8.3%

Inventories (if any) 675 796

• 15.3%

Other current assets 41 36 11.9% Total current assets 1,252 1,461

• 14.3%

Property, plant, and equipment 2,404 2,638

• 8.8%

Non-current assets 135 141

• 4.5%

Total assets 3,791 4,240

• 10.6%

Liabilities Short-term loans 394 420

• 6.1%

Current portion of long-term loans 400 250 60.0% Other current liabilities 253 381

• 33.5%

Total current liabilities 1,048 1,051

• 0.3%

Long-term loans 418 816

• 48.8%

Other non-current liabilities 82 74 10.1% Total liabilities 1,547 1,940

• 20.3%

Equities Retained earnings 865 921

• 98.5%

Total equities 2,245 2,300

• 2.4%

30

Business Expansion

Growing with Strategies

31

Revenue Growth Target ≥ 10% pa. Gross Profit Margin 25-27% Total Debt to Equity

≤ 1.0x

Growth strategies 2013 - 2017

• Expand production capacity and product variety to high margin specialties
• Channel sales mix adjustment /1:
• Expand production base to provincial areas – Chiangmai and Khon Kean – for logistic efficiency

and gains on market share

• Expand production base to neighboring countries – Myanmar and Cambodia – to

accommodate growing demand and for logistic efficiency

Growing the business with prudent financial policy

Modern Trade

15%

25% Export

12%

20% Project

10%

15%

Note: 1. Percentage based on total sales.

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Appendix

Marketing Activities : Domestic

33

Marketing Communications

34

Banner, Magazine Advertorial & Printed Ads.

Marketing Communications : Jatulon Campaign

35

TVC “เฝ ้ ามอง / Secretly Love” Billboard Yala, Pattanee, Narathiwas Printed Ads.

Booth & Event & Training

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Opining Thai Watsadu Chaeng Wattana, 16 Jan. 15 Thai Watsadu Department Manager Training, 25 Feb. 15 PC Training, 2 – 3 March 2015

Domestic Marketing Activities

37

Eiam Seng Fair @Konkean 7 – 14 Feb. 15 Home HUB Fair @Udornthani 5 – 10 Mar. 15 Home Shop Grand Opening @Sakolnakorn, 14 Feb 15

Domestic Marketing Activities

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www.builk.com

• Premium Sponsor
• Partner

Event Organizer ออกบูธให้ความรู้ด้านวัสดุก่อสร้าง ในงาน 60 พรรษา มหามงคล สมเด็จพระเทพฯ ณ วิทยาลัยเทคนิคกาญจนบุรี 17 กุมภาพันธ์ 2558 สัมมนาวิชาการ - ไทวัสดุ 27 ก.พ. – 1 มี.ค. 58

39

Event : 30th Anniversary

Domestic Exhibition 2014

Baan & Suan Fair 2014

Impact Muang Thong Thani,Nonthaburi, Thailand November 1-9, 2014

40

บริษัทฯ เข้าร่วมเป็น Premium Sponsor และออก Event ร่วมกับ www.builk.com ในสินค้าเพื่อสร้าง ฐานตลาดกลุ่มลูกค้าผู้รับเหมา และเจ้าของ โครงการ

Marketing Activities

41

Domestic Marketing Activities

Agent : Talon Tour Japan on October 14-18, 2014

42

Project : Talon Tour Japan on November 17-22, 2014

Marketing Activities : Export

43

Export Activities Dec. 2014 – Mar. 2015

44

Product Demonstration & Training, Cambodia, 15 – 17 Dec. 14 Visiting & Training Vietnam Dealer 23 Dec. 2014

Export Activities Dec. 2014 – Mar. 2015

45

30th Anniversary & Dealer Awards Centara @Central World, BKK, 26 Mar. 15 Seng Hong Heng., Cambodia Dealer from Myanmar visit Thai Watsudu Bangna, 27 Mar. 15 Phonethip 3P, Laos

Payathonzu

Market Survey, MYANMAR October 2014

Installers does not have knowledge about installation properly. Consumers prefer brand with strong CSR. Road infrastructure and construction to Yangon is on progress.

Export Exhibition 2014

46

Cambuild’2014

Phnom Penh, CAMBODIA September 10-12, 2014

Export Exhibition 2014

47

Acetech 2014

Mumbai, INDIA November 6-9, 2014

Export Exhibition 2014

48

Myanbuild’ 2014

Yangon, MYANMAR

December 4 – 6, 2014

Export Exhibition 2014

49

Export Marketing Activities

50

Talon Tour Singapore on September 30- October 18, 2014

CSR Activities

ตราเพชร ดูแลพนักงาน ใส่ใจชุมชน เอื้อเฟื้อสังคม

CG Activities

"HAND IN HAND…ปฏิรูปการต่อสู้ เพื่อชัยชนะอย่างยั่งยืน“

บริษัทฯ ได้รับรางวัล Investors’ Choice Award จาก สมาคมส่งเสริมผู้ลงทุนไทย เนื่องจากบริษัทฯ ได้รับ คะแนนการประเมินคุณภาพการประชุมสามัญประจ าปี (AGM) เต็ม 100 คะแนน ต่อเนื่องกันเป็ นระยะเวลา 4 ปี เมื่อวันที่ 25 กันยายน 2557 บริษัทฯ ได้เข้าร่วมงานวันต่อต้านคอร์รัปชั่นภายใต้หัวข้องาน "HAND IN HAND… ปฎิรูปการต่อสู้ เพื่อชัยชนะอย่างยั่งยืน" เมื่อวันที่ 6 กันยายน 2557

52

บริษัทฯ ได้รับรางวัลสถานประกอบการดีเด่นด้าน แรงงานสัมพันธ์และสวัสดิการประจ าปี 2557

Diamond Building Products Public Company Limited

69-70 Moo 1, Mitraphap Road - km. 115, Tambon Talingchan, Amphur Muang, Saraburi 18000 Tel: 0-3622-4171-8 Fax: 0-3622-4187 Call Center : 0-2619-2333 Website: www.dbp.co.th

THANK YOU

For further information & enquiries, please contact our investor relations at:

Telephone: 0-3622-4171-8 Ext. 193 Email: corpcenter@dbp.co.th