Opportunity Day Q3 2015 Financial Results
25 March 2015
Q3 2015 Financial Results 25 March 2015 Disclaimer This document - - PowerPoint PPT Presentation
Opportunity Day Q3 2015 Financial Results 25 March 2015 Disclaimer This document has been prepared by Eastern Polymer Group Public Company Limited (EPG) solely for the reference of intended recipients only. The data, information, analysis
Opportunity Day Q3 2015 Financial Results
25 March 2015
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This document has been prepared by Eastern Polymer Group Public Company Limited (“EPG”) solely for the reference of intended recipients only. The data, information, analysis and valuations contained herein in this document have been prepared based solely on information obtained from public sources on or prior to the date hereof. EPG has neither independently verified nor in the future intended to verify such information. No representation or warranty, expressed or implied, is or will be made in relation to the accuracy or completeness of the information contained in this document or any oral information provided in connection therewith, or the data it generates and no responsibility, obligation or liability (whether direct
their respective officers, employees or agents in relation to it. In particular, no representation or warranty is given as to the achievement or reasonableness of future projections, estimates, prospects, returns, if any. Any views contained herein are based on financial, economic, market and other conditions prevailing as at the date of this document. EPG does not intend, and therefore shall not be held liable, to update all the information contained herein this Document. Any disclosure or distribution of the information in this document, partly or wholly, to third parties other than the intended recipients without prior written consent from EPG is strictly forbidden.
About EPG Investment Highlights Business Overview Financial Highlights Outlook
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1978 Eastern Polymer Industries Co., Ltd. was established Commencing the manufacture of rubber insulation and accessories under the "AEROFLEX" trademark 1989 Expanding the business into a plastic industry 1994 Major expansion of production plant with establishment of the International Polymer Park industrial estate (IPP) in Rayong province 1995 Establishing the joint ventures business with partners from Japan and Malaysia 1996 Entering the automotive parts industry with a major investment in truck bed liner manufacture under the "AEROLINER" and "HEROLINER" brands 2001 Business expansion in the plastic industry through acquisition of Thai Modern Plastic Plc. Establishing Eastern Polypack Co., Ltd. to manufacture plastic packaging under the "EPP" trademark. Embracing innovative "No-Drill" technology for truck bedliners for the first time in the world 2002 Expanding to overseas market by established Aeroflex Insulation (Shanghai) Co., Ltd. in China 2003 Investing in the manufacture and distribution facilities for insulation business in Tennessee, USA. 2005 Commissioned to manufacture roof ventilation, indoor lighting system and airconditioning systems for Suvarnabhumi International Airport 2006 Establishment of EPG Innovation Center Co., Ltd. 2011 Establishing the manufacture and distribution facilities for auto part business in China, Australia and USA. 2012 Establishing Aeroflex Europe GmbH in Germany. 2013 The group restructured its organization and transformed Eastern Polymer Group Public Company Limited 2014 First trade in the SET on 24th December
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Remarks : Group structure as of 30 Jun 2014
Eastern Polymer Group Plc
Aeroflex (AFC) Aeroflex USA (AUS) APS (APS) Aerocell Construction Material (Jiangsu) (ACM) Aeroflex (AEU) Eastern Poly Pack (EPP) Aeroklas (ARK) Aeroklas USA (ARK-USA) Aeroklas Australia (ARK-AU) Aeroklas Shanghai (ARK-SH) EPG Innovation Center (EIC) Aeroflex Polymer Technology (Shanghai) (APT) Zeon Advanced Polymix (ZAP) Tokai Eastern Rubber (TER)
Insulator Business Car Accessories Business Joint Venture
40.0% 100.0% 40.0% 40.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
Other Supporting Business Plastic Packaging Business
ALP Aeroflex India (AAI)
60.0%
Aeroklas Europe (ARK-EU)
74.9%
Research and Development
20.0% 27.0% 5
About EPG Investment Highlights Business Overview Financial Highlights Outlook
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property rubber insulator (Patented EPDM technology & NBR)
expansion platform to capture international
recognized by world’s leading auto makers
quality commercial car accessories
technology
capability in designing innovative products
technology with world class standard recognition
Construction Material Auto parts Packaging
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1,946 2,044 2,134 1,726 1,962 2,590 2,282 1,758 1,720 2,116 2,177 1,650
2012 2013 2014 9M 2015
Revenue Contribution (TH mm)
EPP AEROKLAS AEROFLEX
Source: Company Remarks: Fiscal Year Ended 31 March
Capacity (as of 1H 2015)
EPDM + Other 20,000 tons/ year
Products
Rubber insulator (EPDM & NBR) Aero Acoustic & Aero-roof Tape, rigid foam, flexible duct, etc.
9M 2015 Revenue breakdown by region
Production facilities = 6
Thailand, USA, Germany, India, China (2) Licensing = 2 Russia, Switzerland
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Domestic 29% International 71%
Source: Company Remarks: Fiscal Year Ended 31 March
Geography Actively Engaged Year Market Shares (%) World
Thailand
USA
Asia
Others
International Expansion Platforms Well Established Platforms to Capture Growth in Potential Markets Types of Platform Country Number
Main Production Plant
Thailand 1
Wholly Owned Subsidiary
USA 1 China 1
Joint Venture
China 1 India 1 German 1
Licensing
Switzerland 1 Russia 1
Distributor/Agent
Worldwide 78
Source: Company
Others 96% Others 70% Others 80%
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Products
Bed liner (HDPE), deck cover (PC ABS), canopy (ABS Alloy), side step (Polymer Alloy) Soft cover, truck body, U-Box
Capacity (as of 1H 2015)
Bed liner 800,000 pieces/ year Deck cover 24,000 sets/ year Canopy 24,000 sets/ year Side step 100,000 pairs/ year
9M 2015 Revenue breakdown by region
Distribution
Owned brand = Aeroklas ODM with leading car manufacturers Production Facilities = 2 Thailand, China
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Domestic 45% International 55%
Source: Company Remarks: Fiscal Year Ended 31 March
Product Performance Company Highlights
industry
automaker companies 1 2
Patented No drilling Installation “Bed Liner” Patented Double ABS Alloy “Canopy” Light Weight Plastic “Side Step”
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Thailand (1) USA (1), Germany (1), China (1), and Australia (1)
Penetration Rate (%) Invented Year Historical Revenue (THB mm) World Market Share (%) Bed Liner (ODM & OBM)
1995
Deck Cover (ODM & OBM)
2004
Canopy (ODM & OBM)
2006
Side Step (ODM & OBM)
2015
Source: Company Remarks: Fiscal Year Ended 31 March
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838 385
Products
Plastic cups: PS (GPPS, HIPS,K-Resin), PET, PP Food container, snack package Plastic sheet
Capacity (as of 1H 2015)
Plastic food packaging 24,000 tons/ year Plastic sheet 5,000 tons/ year
Distribution
Wholesalers, Made-to-order clients, and International clients. Production Facilities = 1 Thailand
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9M 2015 Revenue breakdown by region
Domestic 87%
International 13%
Source: Company Remarks: Fiscal Year Ended 31 March
Company Highlights
including GPPS/PP/PET cup
provide well-designed products that fit with end-users lifestyle
leading domestic/international companies 1 2
Well-designed Plastic Cups for Customer Innovative Product Design with High Quality
3 Products Performance
Plastic food packaging Plastic sheet
1,360
Fiscal Year Ended March (THB mm)
South East Asia
13
303
Source: Company Remarks: Fiscal Year Ended 31 March
5%
1978
Aeroflex – EPDM Generation 1 Density 120 kg/cm3
Innovative Product Milestones
AEROFLEX AEROKLAS EPP
1978
Everseal Tape
2000
Prefoam Tube/sheet
1985
Aeroseal Glue
2004
Aerofix
2005
Aero-roof
2013
Aero Acoustic
1995
No Drilling Installation Liner
2003
Cargo Liner
2004
Deck Cover
2006
PC Alloy Deck Cover
2006
Double APS Alloy Canopy
2015
Plastic Side Step
2014
Sport Bar ABS
2002
First GPPS Plastic Cup in Thailand
2005
The Finest Microwavable Frozen Food Container
2010
First PET Plastic Cup in Thailand
the extensive rate of ~1% of revenue which higher than world average
1 2
in Asia
14 PHDs from department of materials science 2 polymer experts
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testing machines
than 300 tests
2007
Newly innovated Cup
2015
Bowl Liner
2014
Aeroflex – EPDM Generation 9 Density 50 kg/cm3 Continuously Development of EPDM for 12 generations
2017
Aeroflex –EPDM Generation 11 Density 35-40 kg/cm3
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Business Manufacture anti-vibration rubber , resin hoses and sound proof parts for automotive Shareholding Structure Product Types Fuel Hose Sound Proof Anti-Vibration Rubber Liquid Engine Mounting Business Manufacture intermediate rubber compound mix for producing automotive parts Shareholding Structure Product Types Rubber Compound Sheet Rubber Compound Ribbon
Source: Company
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About EPG Investment Highlights Business Overview Financial Highlights Outlook
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Well-established Global Platforms for International Expansion Strong Brand Recognition as World Class Quality Product Innovation-oriented Organization
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High Growth High Margin
Premium World Class Polymer and Plastic Converter
material research center in Asia
temperature range
conductivity
environmental friendly
sound absorption property
insulator
lighter weight and more stocking space
production formula
traditional canopy
weather protection property
installment liner
energy saving
and continuously developed production technology
food container in Thailand
more stocking space
production from
international standard (DIN, ASTM, ISO, EN and JIS)
equipment and testing machines
(> 100 members) with local market understanding
developed production technology
sophisticated products and able to maintain profit margin
process are under control of expertise from reputable international companies
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Strong Brand Recognition as World Class Quality Product
Green Label Certification
almost 100 countries spreading across 7 continents
accepted in HVAC&R industry
properties are qualified almost 100 countries standard
Lloyd’s Register Certification RoHS Certification FM Global Approved DNV Certification
brand in EU and US market
commercial car accessories industry
company
ISO 14001 TS16949 / ISO9001 ABE Certification Thai Owned Brand 2002 Thai Owned Design 2003 The Best Export 2006 OHSAS 18991
world leading companies
design
ISO 9001/2008 NAC TIS 18001 ISO 14001 ISO 9001/2008 UKAS ISO
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Well-established Global Platforms for International Expansion
Main Production Plant of AFC, ARK and EPP
AFC’s Subsidiary
AFC’s Joint Venture
AFC’s Licensing
ARK’s Subsidiary
TER/ ZAP
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Global exporter covering more than 100 countries worldwide Fully integrated production plants in world strategic locations to serve high demand markets Partnership with world leaders of each business Co-operation with local partners to penetrate in upcoming potential market Penetrate into new markets by converting distributors into production plants Distribute products across the world through more than 500 distributors For adding value to products and companies
raw materials from innovative process
efficiency
globally registered patents
network to save logistics cost Well-established Global Platforms for International Expansion Strong Brand Recognition as World Class Quality Product Innovation-oriented Organization
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value - added products, engineered materials and advanced technologies
new markets
products are well – accepted in international markets
standard enabling the expansion with world’s leading automakers
locations to expand into potential markets Well-established Global Platforms for International Expansion Strong Brand Recognition as World Class Quality Product Innovation-oriented Organization
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About EPG Investment Highlights Business Overview Financial Highlights
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Outlook
Profit and Loss 2012A 2013A 2014A 12-14 CAGR 9M/2014 9M/2015 % YoY Q3/2014 Q3/2015 % YoY (Million Baht) Revenue from sales 5,627.8 6,750.2 6,591.8 8.2% 4,993.8 5,134.1 2.8% 1,633.7 1,668.7 2.1% AEROFLEX 1,946.4 2,043.9 2,133.6 4.7% 1,608.9 1,726.2 7.3% 494.5 569.5 15.2% AEROKLAS 1,961.8 2,590.2 2,281.5 7.8% 1,721.2 1,757.8 2.1% 600.7 542.9
EPP 1,719.6 2,116.1 2,176.7 12.5% 1,663.7 1,650.1
538.6 556.4 3.3% Cost of goods sold 4,048.7 4,923.8 4,870.2 9.7% 3,706.4 3,821.6 3.1% 1,256.9 1,243.8
Gross Profit 1,576.5 1,826.4 1,721.6 4.5% 1,288.1 1,313.0 1.9% 377.5 425.1 12.6% SG&A 1,169.2 1,202.0 1,145.5
837.0 815.6
272.7 280.3 2.8% Operating Profit 407.3 624.4 576.1 18.9% 451.1 497.4 10.3% 113.0 144.8 28.1% Equity Profit Sharing 211.0 337.2 305.7 20.4% 244.3 145.0
73.8 45.4
EBIT 681.5 1,091.0 1,040.8 23.6% 857.5 653.8
227.8 198.3
EBITDA 696.8 982.9 1,016.7 20.8% 785.6 869.2 10.6% 234.6 268.4 14.4% EBITDA incl. equity sharing 907.8 1,320.1 1,322.4 20.7% 1,031.8 1,014.2
308.4 313.8 1.8% Net Profit 480.3 787.2 630.6 14.6% 531.5 449.5
116.0 147.6 27.2% Ratios 2012A 2013A 2014A 9M/2014 9M/2015 Q3/2014 Q3/2015 Gross Profit Margin 28.0% 27.1% 26.1% 25.8% 25.6% 23.1% 25.5% EBITDA Margin 12.4% 14.6% 15.4% 15.7% 16.9% 14.4% 16.1% EBITDA Margin incl. equity sharing 16.1% 19.6% 20.1% 20.7% 19.8% 18.9% 18.8% Net Profit Margin 8.5% 11.7% 9.6% 10.6% 8.8% 7.1% 8.8% 24
Remarks: Fiscal Year Ended 31 March
(Million Baht) 2012A 2013A 2014A Q3/2015 Current Asset 4,623.1 3,363.5 3,094.4 4,729.5 Non - Current Asset 6,494.6 7,323.4 7,804.6 7,938.7 Total Asset 11,117.7 10,686.9 10,899.9 12,668.2 Interest bearing debt 5,607.3 6,598.3 6,251.7 3,736.2 Current Liabilities 5,577.1 6,074.5 5,665.4 3,340.6 Non - Current Liabilities 918.8 1,489.0 1,451.1 1,263.3 Total Liabilities 6,495.9 7,563.5 7,116.5 4,603.9 Paid Up Capital 2,100.0 2,100.0 2,100.0 2,800.0 Retained earnings 1,860.8 391.7 959.3 1,209.5 Total Equity 4,621.8 3,123.4 3,782.5 8,064.3 Ratios 2012A 2013A 2014A Q3/2015 ROE 10.4% 25.2% 16.7% 1.8% ROA 4.3% 7.4% 5.8% 1.2% D/E 1.4 2.4 1.9 0.6
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Remarks: Fiscal Year Ended 31 March
AEROFLEX Revenue AEROKLAS Revenue EPP Revenue 26
9M/2015 revenue grew by 7.3%, from international expansion, especially USA market. 9M/2015 revenue grew by 2.1% due to growth in Australian market. Revenue of EPP in 9M/2015 was in line with slow Thai economic situation but in Q3/2015, the revenue increased by 3.3% due to stronger consumption in new year season.
Million baht
1,609 1,726 494 569 2014 2015 9M Q3 1,721 1,758 601 543 2014 2015 9M Q3 1,664 1,650 539 556 2014 2015 9M Q3
Remarks: Fiscal Year Ended 31 March
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9M/2015 COG grew by 3.1%, in line with growth of revenue. 9M/2015 SG&A decreased by -1.6%, due to better expense control. Q3/2015 SG&A increased due to expenses related to IPO, promotion expenses and remunerations.
COGS SG&A
3,706 3,822 1,257 1,244 2014 2015 9M Q3 829 816 265 280 2014 2015 9M Q3
Remarks: Fiscal Year Ended 31 March
2015E 2016E 2017E Total
THB 300 mm THB 600 mm THB 566 mm THB 300 mm THB 100 mm THB 966 mm THB 250 mm THB 100 mm THB 400 - 500 mm THB 850 mm
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Remarks: Fiscal Year Ended 31 March
About EPG Investment Highlights Business Overview Financial Highlights
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Outlook
be partly reflected in Q4 2015 for EPP and Q1 2016 for AEROFLEX and AEROKLAS.
AEROKLAS would generate growth from the start of side step and two new models of canopy production in Q1-2016. The utilization rate and depreciation expense should improve.
significantly and will save finance cost.
fully integrated automotive accessory: 1.Acquire Top-tier assets 2. Immediate enhancing value 3.Relize significant synergies
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automotive manufacturers
manufacture and distribute quality 4WD equipment
makers in various countries
1.1 Automotive part retail shop in Australia with 58 brand distributions nationwide 1.2 Strong Brand Recognition in Australia and USA 31
(1) Acquire Top-tier-asset (2) Immediate Enhancing Value
(3) Realize Significant Synergies