Opportunity Day 4 th June 2018 Information as of 1Q18 Latest update - - PowerPoint PPT Presentation
Opportunity Day 4 th June 2018 Information as of 1Q18 Latest update - - PowerPoint PPT Presentation
Opportunity Day 4 th June 2018 Information as of 1Q18 Latest update on 21 st May 2018 DISCLAIMER The information contained in this presentation is for information purposes only and does not constitute an offer or invitation to sell or the
The information contained in this presentation is for information purposes only and does not constitute an offer or invitation to sell or the solicitation
- f an offer or invitation to purchase any securities of Do Day Dream Public Company Limited (the “Company”) in Thailand, the United States or
any other jurisdiction. This presentation should not, nor should anything contained in it, form the basis of, or be relied upon in any connection with any contract or commitment whatsoever. This presentation is confidential and is intended only for the exclusive use of the recipients thereof and may not be reproduced (in whole or in part), retransmitted, summarized or distributed by them to any other persons without the Company’s prior written permission. This presentation may contain forward-looking statements that involve risks and uncertainties. Forward-looking statements are based on certain assumptions and expectations of future events. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements as a result of a number of risks, uncertainties and assumptions. Although the Company believes that such forward- looking statements are based on reasonable assumptions, it can give no assurance that such expectations will be met. Representative examples of factors that could affect the accuracy of forward-looking statements include (without limitation) fluctuations in in regulations relating to the Company’s business, general economic, political and business conditions, global and regional health and security conditions, the Company’s ability to finance and complete new projects on schedule, liability for remedial actions under environmental regulations and other factors beyond the Company’s control. You are cautioned not to place undue reliance on these forward-looking statements, which are based on current views of the Company’s management on future events. This presentation has been prepared by the Company. 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 Company or any of its directors, officers, employees, agents or advisers, or any of their respective affiliates, advisers or representatives, undertake to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise and none of them 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. Although this document has been prepared based on the information contained in the updated draft Thai prospectus, which is currently under the consideration of the Securities and Exchange Commission of Thailand (the “Thai SEC”), it has not been and will not be registered as a prospectus with the Thai SEC and accordingly, this document may not be distributed, either directly or indirectly, to the public. Further, this document and any materials distributed in connection with this document are not directed to, or intended for distribution to or use by, any person or entity that is a citizen or resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation or which would require any registration or licensing within such jurisdiction. Any decision to purchase or subscribe for securities in the Company should be made solely on the basis of information contained in the prospectus to be published in respect of the offering and no reliance should be placed on any information other than that contained in the prospectus.
DISCLAIMER
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TABLE OF CONTENTS
Background and business Where we are so far Key financial performance Where we will be Key investment highlights Appendix
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Company structure and shareholding structure
THAILAND SINGAPORE INTERNATIONAL
Parent and subsidiaries DO DAY DREAM
Intermediary in trading with foreign customers
DO DAY DREAM TRADING
100%
Investment arm for
- verseas businesses
DO DAY DREAM HOLDING
100%
Future potential partners to do
- verseas business
POTENTIAL PARTNERS
Domestic Distributor
NAMU LIFE PLUS
100%
International Headquarter
DO INFINITE DREAM
100%
Dermatological company
DREAM DERMATOLOGY
95%
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Extensive Product Portfolio Covering Five Categories of Skincare
FACIAL SKIN CARE 1 BODY CARE 2 FACIAL CLEASNING 3 SUNSCREEN 4 BODY CLEANSING 5 GIFTSET 6
Facial Cream SYN-AKE MIST Mask Shot Concentrate Facial Cream Miracle
Royal Jelly Facial Cream
Day Cream Overnight Firming Mask 7 Days Mask Sheet Gold Facial Cream Body Booster Body Booster SPF 30/PA+++ Cleansing Whip Soap Essential Toner Namu Facial Jelly Wash Sunscreen Sunscreen CC Creme Body Wash
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TABLE OF CONTENTS
Background and business Where we are so far Key financial performance Where we will be Key investment highlights Appendix
7
Market Size of
Facial Moisturizer 2017: THB 42 billion Growth: 8%
Market Share
Apr-17: 4% Apr-18: 6%
- No. 6
in Thailand
Source: Euro Monitor, The Nielsen Company Increased Market Share from both Existing and New Products New Snailwhite Sachets play vital role in capturing Market Share
- No. 5
in Supermarket/ Hypermarket
Market Share
Apr-17: 5% Apr-18: 6% Supermarket/Hypermarket
- No. 4
in Convenience Stores
Market Share
Apr-17: 2% Apr-18: 9% Convenience Stores
We are a top-of-mind brand in Thailand
8
Do Day Dream is one of the only 2 Thai manufacturers among top 10 (1/2)
28.4% 15.2% 11.5% 10.2% 6.5% 3.7% 5.7% 3.8% 2.3% 1.7% 26.3% 14.2% 12.1% 9.4% 7.7% 6.0% 4.7% 3.7% 2.5% 1.2% L'Oreal Procter & Gamble Beierdorf Uniliver Others Do Day Dream Smooth-E Mentholatum Aisance Johnson & Johnson SKUs Apr 17 Apr 18 Market Share (%)
80 SKUs 49 SKUs 60 SKUs 31 SKUs 28 SKUs 8 SKUs 19 SKUs 14 SKUs 26 SKUs 10 SKUs
Top 10 Manufacturers in Thailand (Facial Moisturizer)
…
With the lowest No. of SKUs among the top brands, there are rooms for expanding wider range of products.
62%
Growth
9
Do Day Dream is one of the only 2 Thai manufacturers among top 10 (2/2)
Rank Brand Product Size Market Share Apr 18 1 Snail White Snail Wh.Secretion Filtra.Moist.Facial 50 Ml 1.9% 2 Garnier Ageless White Day Serum Sachet 7 Ml 1.7% 3 Garnier Sakura White Pinkish SPF21 Pa+++ Sachet 7 Ml 1.7% 4 Garnier Light Complete White SPF20 Serum Sachet 7 Ml 1.5% 5 Snail White Gold SPF30 PA+++ Cr. 7 Ml 1.5% 6 Dermo Expertise Revitalift Anti-Wrinkle Spf23 50 Ml 1.3% 7 Smooth-E Natural Source Cream 10 Gm 1.1% 8 Garnier Light Complete White SPF20 Serum Sachet 50 Ml 1.0% 9 Dermo Expertise Revitalift Anti-Wrinkle Night Cream 50 Ml 1.0% 10 Pond's Age Miracle Wrinkle Correction Sachet 7 Gm 1.0% Facial Moisturizer SKU Ranking in Modern Trade Channels as of Apr 2018 (Supermarket, Hypermarket, Personal Care Store and Convenience Store)
- No. 1
Market share in Modern Trade
- No. 5
Market share in Modern Trade
- Snail White bundled set was ranked number 1 in Modern Trade Channels
- The newly launched SKU “Snailwhite Gold 7 Ml quickly rises to No.5 just within the second month of launch in Apr’18.
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TABLE OF CONTENTS
Background and business Where we are so far Key financial performance Where we will be Key investment highlights Appendix
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Revenue from sales in 1Q18
Product Group Distribution Channels
2017 1Q17 1Q18
Facial Skin Care 81% Body Care 1% Facial Cleansi ng 6% Body Cleansi ng 5% Sunscre en 4% Others 3% Facial Skin Care 81% Body Care 1% Facial Cleansi ng 3% Body Cleansi ng 6% Sunscre en 2% Others 7%
2017 1Q17 1Q18
Modern Trade 29% Traditio nal Trade and Distribut ion Partner 45% Export 25% Others 0% Modern Trade 37% Traditio nal Trade and Distribut ion Partner 43% Export 20% Others 1% Facial Skin Care 77% Body Care 4% Facial Cleansi ng 4% Body Cleansi ng 8% Sunscre en 4% Others 3% Modern Trade 29% Traditio nal Trade and Distribut ion Partner 41% Export 30% Others 0%
Revenue from sales
Unit: Million baht 262 299 93 75 355 374 1Q17 1Q18 Domestic Overseas Total
5%
Growth
14%
Growth
- 19%
Growth
26% 74%
98%
20% 80%
99%
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Overseas sales
53 20 1 2Q16 2Q17 21 93 1Q16 1Q17 93 75 1Q17 1Q18 Quarter 1 Quarter 2 1Q17 vs 1Q18 32 14 6 3Q16 3Q17 37 55 4Q16 4Q17
353%
Growth
280%
Growth
362%
Growth
47%
Growth
- 19%
Growth
Quarter 3 55 75 4Q17 1Q18 4Q17 vs 1Q18
36%
Growth
Quarter 4
2016 baseline 2017 baseline 2018 baseline
CFDA requires some adjustments of the packages, expected to be complete within June – July 2018.
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28% 32% 3-year target: 28 – 32%
Cost of goods sold in 1Q18
248 349 375 535 110 101 56.70% 36.40% 30.3% 31.9% 31.10% 27.00% 2014 2015 2016 2017 1Q17 1Q18
Raw material and Packaging Freight Labor Depreciation Others % of Sales
COGS
- COGS to sales significantly decreased from 2015
thanks to economies of scale and better bargaining power with the suppliers which result in lower average cost of raw material and packaging
- Significant portion of COGS attributable to raw
materials and packaging
- 1Q 2018, COGS as a % of sales continuous drop
due to product mix that the majority contribution came from facial skin care products, the category with high margin.
Unit: Million baht
14
Selling & administrative expenses in 1Q18
38% 3-year target: 35 – 38% 35%
Selling & administrative expenses
155 361 441.6 725 170 154 35.3% 37.8% 35.7% 43.2% 47.30% 39.70% 2014 2015 2016 2017 1Q17 1Q18
Advertising and Promotional Employee costs Freight Others
Unit: Million baht
- Selling & Administrative Expense has shown
significant increase correlated with increase in sales activity. The increased was mainly attributable by advertising and promotional expenses and employee cost
- Selling and administrative expenses mainly
comprise advertising and promotional expenses and employee expenses
- 1Q 2018, y-o-y SG&A decreased by 9.4% .The
decrease in SG&A was mainly due to the decrease in advertising and sale promotion expenses as there was no deferred advertisement in 1Q18 as it did in 1Q17.
- Even though there was a launch in SnailWhite Gold
in sachet format in 1Q18, our spending for the advertising was still within the predetermined target.
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24% 22%
Profitability in 1Q18
190 608 862 1140 245 273 43.3% 63.6% 69.7% 68.1% 68.90% 73.00% 2014 2015 2016 2017 1Q17 1Q18 Gross Profit % Gross Margin 37 254 441 452 80 143 8.4% 26.6% 35.5% 26.8% 22.40% 37.00% 2014 2015 2016 2017 1Q17 1Q18 EBITDA % EBITDA Margin 28 194 335 351 62 112 6.3% 20.3% 27.0% 20.8% 17.4% 29.0% 2014 2015 2016 2017 1Q17 1Q18 Net Profit % NP Margin
EBITDA Net Profit
Unit: Million baht Unit: Million baht 32% 3-year target 72% 3-year target: 68 – 72%
Gross Profit
Unit: Million baht 68% 3-year target: 22 – 24%
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Financial position
529 776 5,460 5,551 286 401 674 652 243 375 4,786 4,899 2015 2016 2017 1Q18 Total Assets Total Liabilities Shareholders'Equity
Balance Sheet
Unit: Million baht
Key Financial Ratio 2015 2016 2017 1Q18 Days Sales Outstanding (days) 46 53 64 99 Days Inventories on Hand (FG) (days) 29 40 48 106 Days Payable Outstanding (days) 56 80 76 117 Return on Assets (%) 49.8% 51.4% 11.3% 8.2% Return on Equity (%) 133.5% 108.6% 13.6% 9.3% Debt to Equity Ratio (times) 1.2x 1.1x 0.1x 0.1x Interest Bearing Debt to Equity Ratio (times) 0.5x 0.5x 0.1x
- A
B C A B C
Total liabilities increased mainly due to loan to finance new factory Total assets increased mainly due to increase in account receivable and cash and cash equivalent Total Equity increased mainly due to the initial public offering (IPO) on Dec 2017
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TABLE OF CONTENTS
Background and business Where we are so far Key financial performance Where we will be Key investment highlights Appendix
18
Strong 2018 outlook from 3 key drivers
Penetrating through convenience store and traditional trade channel
1
- Launching Sachets (small size product) with an aim to capture new customer
segments; younger age group and those in up-country
- Mainly sold through convenience stores and traditional trade channel with
more than >400k stores across Thailand Expansion into King Power Duty Free
2
Vibrant opportunity in Chinese market
3
- Broaden distribution channels through King Power Duty Free to help increase
both brand outlets and brand awareness for international consumers
- Currently sold in two out of nine branches (Srivaree and Suvarnabhumi Airport)
- Expanding to Chinese market, which has a value of more than THB 1 trillion
(RMB 200 billion), through both online platforms and offline channels
- First Thai skincare brand sold in China Duty Free
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Thai skincare market is currently driven by “sachet”
Total Thailand SKU Ranking of Facial Moisturizer as of Apr 2018 Rank Brand Product Size Market Share Apr 18 1 Garnier Ageless White Day Serum Sachet 7 Ml 2.4% 2 Garnier Sakura White Pinkish SPF21 Pa+++ Sachet 7 Ml 2.4% 3 Garnier Light Complete White SPF20 Serum Sachet 7 Ml 2.1% 4 Snail White Snail Wh.Secretion Filtra.Moist.Facial 50 Ml 1.6% 5 Olay Natural White Pink Fairness Sachet 7.5 Gm 1.3% 6 Pond's Age Miracle Wrinkle Correction Sachet 7 Gm 1.3% 7 Snail White Gold SPF30 PA+++ Cr. 7 Ml 1.3% 8 Pond's White Beauty Aura Boots&Clear Serum Sachet 10 Gm 1.2% 9 Dermo Expertise Revitalift Anti-Wrinkle Spf23 50 Ml 1.1% 10 Smooth-E Natural Source Cream 10 Gm 1.0%
- 7 out of 10 are sachets.
- Snail White sachets ranks as
No.4 and No.7 in CVS in Apr 2018.
- Sachet format has a huge
potential to grow through traditional trade channels
JUN17 JUL17 AUG17 SEP17 OCT17 NOV17 DEC17 JAN18 FEB18 MAR18 APR18
Total Snail White 7 Ml Sachet Snail White Day Cream 7 Ml Sachet Snail White Gold Cream 7 Ml Sachet
CVS: Value Sales Source: The Nielsen Company
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Sachet products play a key role in convenient stores
4 shelves in convenient stores are dedicated to personal care products 1 shelf is for Facial Moisturizer 50% of the shelf is for sachet products SnailWhite products located on the prime location: the top shelf for sachet products Additional shelf for sachet products located in the 2nd location
1 2 3 4
21
New penetration in Traditional Trade channel 1 NAMU LIFE Shop
at BTS Siam
21 Stores
Online & Special Channels
Channels Stores Online 9 Others 11
Pan Asian Distribution China Thailand Laos Cambodia Myanmar
New growth markets Existing market stronghold
Distribution Channels
Do Day Dream PLC.
>13,000 Stores
Modern Trade
Channels Stores Beauty 49 Health&Beauty 795 Hyper 200 Department Store 47 Supermarket 277 Convenience Store 9,247 Others 2,385
>1,300 Stores
Traditional Trade
Pharmacy Chain
>1,300 stores across 77 Provinces
Sino-Pacific Trading Co. Ltd.
- Has been distributing FMCG products
since1970
- Specializes in distributing product to about
400,000 of Traditional Trade Channels
- Distributor of global brands including Chupa
Chups, Ricola, Mentos, Tic Tac, etc
Collaboration with Sino-Pacific
22
Strong 2018 outlook from 3 key drivers
Expansion into King Power Duty Free
2
- Broaden distribution channels through King Power Duty Free to help increase
both brand outlets and brand awareness for international consumers
- Currently sold in two out of nine branches (Srivaree and Suvarnabhumi Airport)
Penetrating through convenience store and traditional trade channel
1
- Launching Sachets (small size product) with an aim to capture new customer
segments; younger age group and those in up-country
- Mainly sold through convenience stores and traditional trade channel with
more than >400k stores across Thailand Vibrant opportunity in Chinese market
3
- Expanding to Chinese market, which has a value of more than THB 1 trillion
(RMB 200 billion), through both online platforms and offline channels
- First Thai skincare brand sold in China Duty Free
23
King Power Duty Free Stores Expansion
No Branch Status 1 King Power Sivaree 2 King Power Suvarnabhumi Airport 3 King Power Rangnam NEW in 2018 (entered in 1Q) 4 King Power Chiangmai Airport NEW in 2018 (entered in 1Q) 5 King Power Phuket 2Q18 6 King Power Don Mueang Airport 2Q18 7 King Power Pattaya TBU 8 King Power Phuket Airport TBU 9 King Power Hatyai Airport TBU
- No. of Customers in King Power Stores (Total Year):
31,200,000
- % of Chinese Customers in King Power Stores (Total
Year): 55% of Total Customers
- 60% of Chinese Customers shop in Srivaree,
Rangnam, and Pattaya locations Source: Brand Buffet, Marketing Oops, Khao Sod
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Strong 2018 outlook from 3 key drivers
Penetrating through convenience store and traditional trade channel
1
Expansion into King Power Duty Free
2
Vibrant opportunity in Chinese market
3
- Launching Sachets (small size product) with an aim to capture new customer
segments; younger age group and those in up-country
- Mainly sold through convenience stores and traditional trade channel with
more than >400k stores across Thailand
- Broaden distribution channels through King Power Duty Free to help increase
both brand outlets and brand awareness for international consumers
- Currently sold in two out of nine branches (Srivaree and Suvarnabhumi Airport)
- Expanding to Chinese market, which has a value of more than THB 1 trillion
(RMB 200 billion), through both online platforms and offline channels
- First Thai skincare brand sold in China Duty Free
25
China outlook in 2018
Products with CFDA
NAMU LIFE SNAILWHITE FACIAL CREAM NAMU LIFE SNAILWHITE CLEANSING NAMU LIFE SNAILWHITE WHIPP SOAP
Online Cross-border e-commerce CHINA
Not required CFDA
Mainstream
- nline platform
Required CFDA
- Market size is much bigger than
Cross-border e-commerce.
- Allow wholesale transaction
- Lower transportation cost due
to the bundle shipments
- Cross-border is temporary
which is subject to change according to Chinses policy.
- Not eligible for wholesale
transaction Offline
Required CFDA
- Currently in talk with one of the
distributors
ALREADY ENTERED
Main benefits of CFDA
- More easily accessible
in Mainstream online platform and offline channels which the market is much bigger than Cross-border e- commerce alone
- No risk from the policy
change of Cross-border e-commerce
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First Thai skincare sold in Zhuhai Duty Free in China
DDD has recently got into an agreement to sell SNAILWHITE products in Zhuhai Duty Free store, located at the border between China and Macau. The store has 250,000of foot traffic going and out of China daily.
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Additional Update: Oxe’Cure will be one of DDD’s brand portfolio to focus on dermatological skin care
DO DAY DREAM
Untapped Market
?
Untapped Market
?
Untapped Market
?
Untapped Market
?
Skin care Bath and body Dermatological
Premium Mass Premium Mass Premium Mass
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Acquisition Implication
Acquisition Implication DDD x Oxe’Cure 1 2 3 4 5 6
Wider product coverage, less reliance on a single brand Expansion of customer base in terms of both age and gender Leverage DDD distribution network Better utilization of factory capacity Brand with the promising profitability in 2017, despite minimal marketing effort Outstanding growth of anti-acne market
THANK YOU
CONTACT US DO DAY DREAM PLC. Investor Relations Department Tel: +662-917-3055 Fax: +662-917-3054 Email: ir@dodaydream.com Website: www.dodaydream.com Contact person
- Ms. Chanoknan Thiemrat (Investor Relations)