Minor International 2Q09 Analyst Meeting 17 August 2009 Pratana - - PowerPoint PPT Presentation
Minor International 2Q09 Analyst Meeting 17 August 2009 Pratana Mongkolkul, CFO Todays Agenda I. Key Issues & Business Performance II. 2Q09 Financial Results III. Key Strategic & Industry Update IV. Pipeline Expansion &
2Q09 Analyst Meeting
17 August 2009
Pratana Mongkolkul, CFO
I. Key Issues & Business Performance II. 2Q09 Financial Results
IV. Pipeline Expansion & Cashflow Outlook V. Q&A
Corporate: Completed the business restructuring plan with an acquisition of 99.92% stake in Minor Corporation; Bt 0.08 final dividend payment. Food Business: Opened 20 new outlets including 9 owned and 11 franchised ( 9 in Thailand and 11 overseas); Closed down last two outlets of LeJazz brands in China; Total food outlets reach 1,084 Hospitality Business: Increased stake in Harbour View Hotel in Haiphong Vietnam to 30.39%; Managed 2 new spas in Tanzania and Turkey Retail Trading Business: Signed an agreement with Gap Inc. to open Gap store in Thailand
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April May June July
Discontinued LeJazz brand in China Successfully issued Bt 2.0 bn debenture
Aug
Completed business restructuring plan & acquiring 99.92% stake of Minor Corp. Paid final dividend of Bt 0.08 per share Increased stake in Harbour View Haiphong to 30.39% from 19.98% Managed 2 new spas in Tanzania and Turkey Total food
increased by 20 to 1,084 Signed agreement with Gap Inc. to
Thailand Secured 7-year long term loans from 2 major banks in total
Food Hotel & Spa Mixed-Used
Manufacturing
Retail Trading
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1,084 outlets 27 hotels and 32 spas 303 shops & distribution channel 67 residential units and 3 shopping plaza
Cheese, Ice cream Factory and FMCG Factory
2nd Quarter 2009: Bt 3,725 m 1st Half 2009: Bt 8,039 m
Food 63% Hotel & Spa 31%
Plaza & Entertainment 3%
Retail Trading 1% Share of Profit 1%
Food 65% Hotel & Spa 28%
Plaza & Entertainment 3% Retail Trading 3%
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12.9% Total System Sales Growth
13% Revenue Growth 15% EBITDA Margin 41% EBITDA Growth
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Food Business
44% Occupancy Rate
27% EBITDA Margin
Hotel & Spa Business
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Brand SSS (%) TSS (%) SSS (%) TSS (%)
2Q09 2Q08 2Q09 2Q08 6M09 6M08 6M09 6M08 The Pizza Company
6 2
1 10 8 Swensen’s
2 7 11
8 10 Sizzler
30 11 27 1 21 12 19 Dairy Queen 9 4 18 5 2 9 11 Burger King
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2 7 16 The Coffee Club 2 4 18 18 2 4 18 21 Thai Express
6 52 62
8 61 57
Average
3 13 16
4 15 17
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Hotel
Occupancy (%) ADR (Bt/night) Occupancy (%) ADR (Bt/night)
2Q09 2Q08 2Q09 2Q08 %Chg 6M09 6M08 6M09 6M08 %Chg
Four Seasons 36% 53% 8,222 8,741 (5.9%) 42% 61% 9,082 9,605 (5.4%) Anantara 39% 59% 6,767 6,615 2.3% 42% 68% 8,608 8,011 7.5% Marriott 53% 73% 3,466 3,811 (9.1%) 61% 81% 4,192 4,651 (9.9%) Others 29% 45% 7,708 6,520 18.2% 31% 50% 9,443 8,101 16.6% Average-Thai 44% 64% 4,405 4,783 (7.9%) 51% 73% 5,220 5,705 (8.5%)
Average 44% 64% 5,287 5,376 (1.7%) 50% 72% 6,328 6,386 (0.9%)
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Hotel
RevPar (Bt/night) RevPar (Bt/night)
2Q09 2Q08 %Chg 6M09 6M08 %Chg
Four Seasons 2,937 4,672 (34.0%) 3,771 5,832 (35.0%) Anantara 2,632 3,905 (33.0%) 3,623 5,466 (34.0%) Marriott 1,835 2,778 (37.0%) 2,575 3,781 (32.0%) Others 2,252 2,961 (24.0%) 2,948 4,046 (27.0%) Average-Thai 1,937 3,078 (37.0%) 2,660 4,160 (36.0%)
Average 2,322 3,442 (33.0%) 3,156 4,608 (32.0%)
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Others 10% Manufacturing 39% Retail Trading 51%
# Outlets 2Q09 Chg q-q Chg y-y
Fashion 221
9 Cosmetics 64 1
Others 18
Total Outlets 303
MINT’s source of revenue is extended to retail trading & manufacturing business with additional Bt 116m revenues for 17 day consolidation Total outlets as end of 2Q09 stood at 303 with the majority outlets belong to Esprit, Bossini, Charles & Keith and Timberland for fashion brands and Red Earth, Laneige, and Bloom for cosmetics brands
Revenue Contribution
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(Bt Million) 2Q09 % 2Q08 % % y-y Change Food Services 2,424 65% 2,156 56% 12% Hotel & Spa Services 1,047 28% 1,386 36% (24%) Residential Property 6 0.2% 138 4% (96%) Plaza & Entertainment 128 3% 161 4% (20%) Retail Trading 116 3%
n.a. Share of Profit 4 0.1% 7 0% (39%) Total Revenue 3,725 100% 3,848 100% (3%) Operating Expenses 1,220 33% 1,268 33% (4%) SG&A Expenses 1,717 46% 1,682 44% 2% EBITDA 788 21% 899 23% (12%) Depreciation & Amortization 387 10% 338 9% 15% EBIT 400 11% 561 15% (29%) Interest Expenses 90 2% 83 2% 9% Tax 65 2% 110 3% (41%) Minority 15 0.4% 17 0.4% (10%) Net Profit 230 6% 351 9% (34%) Excluded Revenue from Timeshare III
3,709 3,782 (2%)
771 832 (7%)
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(Bt Million) 2Q09 % Food Services 2,424 65% Hotel & Spa Services 1,047 28% Residential Property 6 0.2% Plaza & Entertainment 128 3% Retail Trading 116 3% Share of Profit 4 0.1% Total Revenue 3,725 100% Operating Expenses 1,220 33% SG&A Expenses 1,717 46% EBITDA 788 21% Depreciation & Amortization 387 10% EBIT 400 11% Interest Expenses 90 2% Tax 65 2% Minority 15 0.4% Net Profit 230 6%
Share of profit 1%
Retail Trading 3%
Plaza & Entertainment 13% Hotel & Spa 36% Food 47%
Net Profit Contribution 2Q09 % Food Services 121 53% Hotel & Spa Services 25 11% Plaza & Entertainment 67 29% Retail Trading 17 7% Consolidated Net Profit 230 100% EBITDA Contribution
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(Bt Million) 6M09 % 6M08 % % Growth Food Services 5,056 63% 4,120 50% 23% Hotel & Spa Services 2,518 31% 3,413 42% (26%) Residential Property 15 0.2% 288 4% (95%) Plaza & Entertainment 271 3% 311 4% (13%) Retail Trading 116 1%
n.a. Share of Profit 64 1% 79 1% (19%) Total Revenue 8,039 100% 8,212 100% (2%) Operating Expenses 2,565 32% 2,656 32% (3%) SG&A Expenses 3,640 45% 3,286 40% 11% EBITDA 1,834 23% 2,269 28% (19%) Depreciation & Amortization 764 10% 657 8% 16% EBIT 1,070 13% 1,613 20% (34%) Interest Expenses 200 2% 170 2% 18% Tax 198 2% 304 4% (35%) Minority 41 0.5% 37 0.5% 9% Net Profit 631 8% 1,101 13% (43%) Excluded Revenue from Timeshare III
8,008 8,074 (1%)
1,803 2,132 (15%)
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(Bt Million) 6M09 % Food Services 5,056 63% Hotel & Spa Services 2,518 31% Residential Property 15 0.2% Plaza & Entertainment 271 3% Retail Trading 116 1% Share of Profit 64 1% Total Revenue 8,039 100% Operating Expenses 2,565 32% SG&A Expenses 3,640 45% EBITDA 1,834 23% Depreciation & Amortization 764 10% EBIT 1,070 13% Interest Expenses 200 2% Tax 198 2% Minority 41 0.5% Net Profit 631 8%
Share of Profit 3%
Retail Trading 1%
Plaza & Entertainment 11% Hotel & Spa 44% Food 41%
Net Profit Contribution 6M09 % Food Services 233 37% Hotel & Spa Services 251 39% Plaza & Entertainment 130 21% Retail Trading 17 3% Consolidated Net Profit 631 100% EBITDA Contribution
200 400 600 800 3Q07 3Q08 4Q07 4Q08 1Q08 1Q09 2Q08 2Q09 Net Profit
11 9 14 10 17 9 9 6
Net Profit Margin 0.0625 0.1250 0.1875 0.2500 3Q07 3Q08 4Q07 4Q08 1Q08 1Q09 2Q08 2Q09
0.07 0.10 0.12 0.23 0.12 0.17 0.11 0.11
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Net Profit Earning Per Share
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Return On Asset Return on Equity
7,500 15,000 22,500 30,000 2Q08 3Q08 4Q08 1Q09 2Q09 Total Assets 3,750 7,500 11,250 15,000 2Q08 3Q08 4Q08 1Q09 2Q09 Total Parent's Shareholders' Equity
Note: Calculations based on revolving 4 quarters
Return on Equity = Net Profit / Total Parents’ Shareholders’ Equity
9.2 9.0 8.1 6.6 6.0 Adjusted Return on Assets 20.0 18.5 16.4 13.4 12.6 Adjusted ROE
7,500 15,000 22,500 30,000 2Q08 3Q08 4Q08 1Q09 2Q09 0.6 0.6 0.6 0.7 0.9 Net Debt-to-Equity Note: Debt to Equity Ratio = Interest Bearing Debt / Total Equity Equity Interest Bearing Debt Other Liabilities 20 375 750 1,125 1,500 2Q08 3Q08 4Q08 1Q09 2Q09 EBITDA Interest Expense Note: Calculations based on revolving 4 quarters; Interest Coverage Ratio = EBITDA / I 12.3 12.6 11.4 9.9 9.5 Interest Coverage Ratio Interest Coverage Ratio
Net Debt to Equity Ratio Interest Coverage Ratio
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Then Trend What MINT is doing?
Food
Old-school dine-in Convenience-oriented
Hotel
Destination-based Activity-based
Residential
Pure Accommodations Mix-used development
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Growing health & wellness food segment Consumers driven by convenient channel Premium food concept/variety Flavors added by international travelers demand Demand for day parts (Breakfast/snacks)
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Increasing Penetration
Growing with Modern Trade
Aggressive Value Promotion
Office Building
Household
Delivery dockets reached 1.7 million in 1H09 showing a 7% increase y-y Promotion participation compared to last year posted a strong growth especially BK, TPC and SL
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Note: *On sales revenues basis, except for Sizzler that bases orders
TPC BK SL SW
31% 31% 26% 17% 30% 24% 6% 12%
2Q08 2Q09
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Thai tourism remains the powerhouse of Mekong region given its cultural historical and geographical diversity Apart from Bangkok and Phuket, there are many emerging tourists’ favorite destination including Chaing Mai, Koh Samui, Koh Phangan, and Krabi The industry was severely hit in late 2008 by political unrest and further in 2009 attributed mainly to the slowdown of global economy and the H1N1 virus
Giving the industry importance to The country’s GDP, the government has launched several tourism recovery programs including the massive budget and policy measures in order to restore business and consumer confidence
1.25 2.50 3.75 5.00 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 Number of Tourist
68 55 53 50 53 42
Occupancy (%) (Million Persons)
Foreign Tourists & Thai hotels Occupancy
Source: BOT
C h a l l e n g e s Favorable Outlook
Global economic crises in major economies; US, UK, etc. Emerging markets with high purchasing power; China, India, Russia, etc. Competition from neighboring countries Dual destinations, given Thailand’s preferred destination for leisure Fluctuating energy prices Expansion of low-cost carriers Domestic political tension Short-term detraction: ex. Bali Outbreak of H1N1 flu Less dissemination with sufficient medication & treatment
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2008 GDP Growth* 2008 Outbound Tourists Arrivals to Thailand (Jan-Nov 08)
China 9.8% 42 milllion 0.8 million Russia 6.0% 30.4 million 0.3 million India 6.6% 10 million 0.5 million UAE 8.5% 3.4 million 0.09 million
Source: CIA World Factbook
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Source: Deliotte Hospitality Vision, Spring 2009
Middle East, Asia Pacific and Africa: Highest growths in international tourist arrivals compared to 2000
117% growth 68% growth 72% growth
In 2008, Abu Dhabi’s RevPar soared 46% y-y with 81.5% occupancy rate!
Bushmans Kloof, Western Cape, South Africa Oberoi Vanuavillas, India Jade Mountain, St. Lucia Sabi Sabi Private Game Reserve, South Africa Inn at Manitou, Ontario, Canada
Top 10 Hotels Overall by Travel + Leisure
Singita Sabi Sand, South Africa Four Seasons Tented Camp, Chiang Rai Oberoi Udaivilas, India Governors’ Camp, Kenya Jack’s Camp Kalahari, Botswana
Source: UN/WTO
Type of Tourism Top Destinations
Leisure: Culture, Beach, Mountain, Shopping Thailand, Indonesia, Maldives, China, Vietnam, Malaysia, HK Wellness & Medical: Beauty, Healthcare, & Retirement Home Thailand, Taiwan, Province of China, India Business: MICE Market Singapore, HK, China, Thailand Gaming: Casino, Theme Park & Entertainment Singapore, Macau, Malaysia, Australia
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34 Source: HVS Asia Pacific Hotel Watch 2009
150 300 450 600 Bali Langkawi Phuket Sanya Samui Maldives
Top 6 Resort Markets in Asia Pacific: 2008 RevPar
Thailand MINT’s Hotels
Others 19% China 7% Japan 11% Korea 6% Malaysia 4% Other East Asia 16% USA 6% UK 7% EU (Ex-UK) 24%
Source: Office of Tourism Development, MINT
Thailand 12%
Others 13% China 3% Japan 5% Korea 1% Malaysia 1% Other East Asia 11% USA 12% UK 10% EU (Ex-UK) 31%
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Global recession is the least threat for Thai tourism, but the unstable political situation Immediate weak outlook from contracted GDP adversely impacted domestic consumption, investment, and tourism According to Horwath HTL, Thai tourism industry should return to positive growth in 2010 assuming political situation remains stable
Regional Outlook 2009F 2010F OCC ADR OCC ADR Bangkok
50-55% $90-95 55-60% $85-90
Phuket
55-60% $110-115 65-70% $105-110
Bali
65-70% $115-120 65-70% $120-125
Singapore
65-70% $170-175 65-70% $170-175
Source: Horwath HTL
1,250 2,500 3,750 5,000 Residential & Others Food Hotel Total Expansion Normal
Residences Turtle Village Outlets expansion : 33 own-equity
Earn-out payment to TCC & TE St Regis Hotel Anantara Baa Atoll, Maldives Four Season Chiang Mai (expansion) Anantara Phuket Earn-out payment to Elewana
(Bt m) Bt1,100m Bt700m Bt2,400m Bt4,200m
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Anantara Baa Atoll Hotel
Project: 82 Keys Completion: April 2010 3 months delay from expand program of work and complicated in detail design
Project: Hotel 220 keys; 53 Condo units Completion: September 2010 Building construction up to 32 storey; overall main equipment completed 60%
Four Seasons Chiang Mai, Extension
Project: Hotel 12 pool villas Completion: 4Q 2009
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Organic Expansion RESTAURANT (# OUTLETS) HOTEL (# ROOMS) RESIDENTIAL EQUITY FRANCHISE INVESTMENT MANAGE (# UNIT) 2009 33 68 12 182
58 35 302 270 53 2011 41 46 20 866
36 73 Under Reviewed 460
40 83 Under Reviewed 2014 40 67 Under Reviewed
248 372 314 1,778 53 CAPEX (Bt m) FOOD* HOTEL RESIDENTIAL & OTHER 2009 1,100 2,400 700 2010 1,400 2,000 900 2011 1,000 500 100 2012 700 300
700 300
700 300
4,500 3,400 1,000
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10 20 30 40
2010-2014
(Bt bn)
EBITDA
Committed CAPEX
New Opportunity
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42 Debt Outstanding as of Jun-09 (Bt m) Payment Schedule 2009 2010 2011 2012 2013 2014 2015 Bank OD & Short Term Loan 1,057 100%
3,707 6% 45% 16% 14% 6% 4% 10% Long Term Debenture 6,450 4% 20% 16% 29% 0% 32% 0% Total Debt 11,214 14% 26% 14% 21% 2% 20% 3% Debt Outstanding as of Jul-09 (Bt m) (After issued Bt 2bn 4 year debenture) Payment Schedule 2009 2010 2011 2012 2013 2014 2015 Bank OD & Short Term Loan 657 100%
2,713 7% 61% 16% 13% 3% 0% 0% Long Term Debenture 8,450 3% 15% 12% 22% 24% 24% 0% Total Debt 11,820 9% 25% 12% 19% 18% 17% 0%
After bond Issuance
2 3 4 5 6 7 8 2Q08 3Q08 4Q08 1Q09 2Q09 Jul-09
7.0 7.4 7.4 6.9 6.3 6.1
5.2 5.7 5.5 5.2 4.4 4.4
MINT total debt outstanding as end of 2Q09 stood at Bt 11,214m with effective interest rate of 4.4% 93% of total debts are Thai Baht while the rest is RMB from its China Food
In July, MINT has successfully placed its first PO debenture to retail investors with 4-year tenure at the coupon rate 4.65%. The bond maintains its “A” rating investment by TRIS
Average Borrowing Cost
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MINT
Note: * Average MLR quoted by big 5 commercial banks Source: Bank of Thailand, MINT
Project Type of Funding Amount Drawdown Position as of Jun-09
Term Loan 9 years, Grace Period 3 years Bt 3,050 m Bt 20 m Term Loan 7 years, Grace Period 3 years US$ 30 m None New Acquisition Committed Standby Line Bt 4,000 m None Refinancing & Investment 7 years loan from local commercial banks Bt 4,000 m Loan agreement signed Apr 09 Refinancing 4 years Bond, Interest Rate 4.65% Bt 2,000 m Issued Jul 09
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0% 50% 100% 2006 2007 2008 2009F 25% 28% 28% 25% 24% 23% 23% 22% 23% 27% 26% 26% Q4 Q3 Q2 Q1 2006 2007 2008 2009F 22% 35% 31% 20% 23% 19% 18% 14% 17% 39% 28% 33%
Total Revenues Net Income
42% - 45% 55% - 58% 40% - 45% 55% - 60%