SAT SAT ... To Become the Auto Parts Manufacturing Leader in ASEAN - - PowerPoint PPT Presentation

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SAT SAT ... To Become the Auto Parts Manufacturing Leader in ASEAN - - PowerPoint PPT Presentation

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SAT SAT ... To Become the Auto Parts Manufacturing Leader in ASEAN ... To Become the Auto Parts Manufacturing Leader in ASEAN 3Q08 Operating Results 3Q08 Operating Results 3 December 2008 3 December 2008 Agenda Industry Overview

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SLIDE 1

SAT SAT

... To Become the Auto Parts Manufacturing Leader in ASEAN ... To Become the Auto Parts Manufacturing Leader in ASEAN… … 3Q08 Operating Results 3Q08 Operating Results

3 December 2008 3 December 2008

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SLIDE 2

Agenda

  • Industry Overview
  • Group Business
  • Performance Review
  • Future Outlook
  • Appendices
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SLIDE 3

3

10M08 Car Production & Sales Overview

1,193,088 1,057,251 510,200 509,186 666,462 552,004

200,000 400,000 600,000 800,000 1,000,000 1,200,000

10M07 10M08 Production Domestic Sales Export Sales

Source : Thailand Automotive Institute (pls. find details on page 29)

Units

1 3 % % 2 1 %

Prod Dom Sales Exp Sales

Pick Up & PPV 78% Passenger 22% Pick Up & PPV 55% Passenger 38% Others 7% Pick Up & PPV 70% Passenger 29% Others 1%

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SLIDE 4

4

10M08 Car Production by Type & Brand

775,811 835,051 342,641 261,965 15,396 19,475 200,000 400,000 600,000 800,000 1,000,000 1,200,000

10M07 10M08 Pickup & PPV Passenger Car Others

Units

8 % 3 1 % Toyota 40% Isuzu 24% Nissan 5% Mitsubishi 17% AAT 14%

P/U &PPV P/C

Toyota 46% Honda 39%

Nissan 4% Mitsubishi 2%

Others 9%

Source : Thailand Automotive Institute (pls. find details on page 29)

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SLIDE 5

5

10M08 Domestic Car Sales by Type & Brand

Toyota 41% Isuzu 41%

M i t s u b i s h i 6 %

AAT 5% Nissan 7% Toyota 46% Honda 37% Others 10%

153,171 321,863 281,485 193,480 34,152 35,235

100,000 200,000 300,000 400,000 500,000 600,000

10M07 10M08

Pickup & PPV Passenger Car Others

Units

  • 13%

2 6 %

P/U &PPV P/C

Nissan 3%

M i t s u b i s h i 2 % M a z d a 2 %

Source : Thailand Automotive Institute (pls. find details on page 29)

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SLIDE 6

6

10M08 Export Car Sales by Type & Brand

122,019 518,703 429,985 147,759

100,000 200,000 300,000 400,000 500,000 600,000 700,000

10M07 10M08

Pickup & PPV Passenger Car

Units

2 1 % 2 1 % Toyota 39% Isuzu 14% Nissan 5% Toyota 44% Honda 41%

Mitsubishi 2%

Others 7% Nissan 5% Mitsubishi 22% AAT 20%

P/U &PPV P/C

Source : Thailand Automotive Institute (pls. find details on page 29)

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SLIDE 7

7

10M08 Export Car Sales Destinations

27% 25% 20% 25% 20% 19% 15% 13% 8% 12% 8% 7% 0.03% 1.43%

0% 25% 50% 75% 100%

10M07 10M08

666,462 Units 552,004 Units

%

Aus, NZ & Oceania (+ 10%) Asia (+ 50%) Middle East (+ 14%) Europe (+ 7%) Central&S. America (+ 76%) Africa (-6%) Others

Source : Thailand Automotive Institute (pls. find details on page 29)

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SLIDE 8

8

Thailand Car Production & Sales

360 158 327 412 459 585 751 928 1,125 1,188 1,287 1,200 1,407 1,427 1,250

(-12%)

363,156 144,065 218,330 262,189 296,985 409,362 533,176 626,026 703,261 682,161 631,251 650,000 42,218 67,857 125,702 152,835 181,471 175,299 770,000 235,122 332,053 440,705 538,966 690,100

400 800 1,200 1,600

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008F 2009F

Actual Production Carmakers Prod Forecast TAI Prod Forecast Domestic Sales Export Sales

Asia’s Recovery Thousand units Asia Financial Crisis of 1997-98

Source: 1997-2007 Federation of Thai Industry

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SLIDE 9

9

Thai OEMs’ Actions in the Midst of the Global Crisis

  • Cut 40% production volume plan during Feb-Jun09

(dropped by 20% of 2008) MMth

  • Temporarily shut down plant (during Dec08-Jan09), then

transfer production to Isuzu plants. GM

  • Cut 15% of production volume during Dec08-Mar09

(~ 35,000 units)

  • Total estimated car production volume dropped by 30% in

2009 Isuzu

  • Cut 30% of production volume during Nov08-Apr09

(~ 45,000 units)

  • Total estimated car production volume in 2009 dropped by

20% for domestic sales and 30% for export sales (~ 570,000 units). But PC to be considered again in Feb09.

  • Less fixed cost by terminating of 350 sub-contract workers

Toyota

  • Launch strategy to penetrate new potential market ;

Eastern Europe, Middle East

  • Temporarily shut down plant (during Dec08-Jan09)

AAT

  • Keep expansion of passenger car production line as

planned Honda

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SLIDE 10

10

2009 a Tough Year for Thai Suppliers

  • The dramatically lower oil

price would ease new car sales pressure

  • Gain car production

volume of the shut-down plants in other countries

  • Merge for business

synergy i.e. economies of scales, knowledge sharing

Opportunities Opportunities

  • The highly uncertain

situation makes it presently impossible for OEMs to submit a reliable forecast for 2009 and hence reaffirm their medium-term goals

  • OEMs demand further

cost cuts

  • Costly imported steel for

the result on the baht continued depreciating against USD

  • Lack of liquidity as a

result of global credit crunch

Threats Threats

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SLIDE 11

11

Thai Export Destination in Prospect

  • 1.2%

4.2% ASEAN-5

  • 1.5%

6.3% India

  • 1.5%

2.2% Global

  • 1.2%

6.5% Asia (excl. Japan)

  • 1.2%

8.5% China

  • 0.7%
  • 0.2%

Japan

  • 1.5%

5.1% Emerging Countries

  • 0.5%

4.0% Thailand

  • 0.8%

5.3% Middle East

  • 0.6%

1.8% Australia

  • 0.7%
  • 0.5%

Euro area

  • 0.7%
  • 0.7%

USA % Economic growth % GDP Growth 2009(E)

Sources : IMF ( November 2008)

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SLIDE 12

Agenda

  • Industry Overview
  • Group Business
  • Performance Review
  • Future Outlook
  • Appendices
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SLIDE 13

13 BSK 29% NHK 70% Other 1%

Market Share of Product Champions

SMT 8% Other 4% SAT 88%

80% 85.65%

50% 60% 70% 80% 90% 100% 2006 2007

Market share Aug Y 2008

Rear Axle Shaft Target 85 % Rear Axle Shaft Target 85 %

Customer Model

Toyota (100%) Fortuner, Vigo Mitsubishi (100%) Strada, Triton AAT (Mazda & Ford) (100%) BT-50, Everest Isuzu (66%) D-Max 4x4, 2x4 , 4x2 (3,000cc. Only), MU-7

Market share Aug Y 2008

Coil Spring Target 28 % Coil Spring Target 28 %

24% 28.36%

0% 10% 20% 30% 40% 50% 2006 2007

Customer Model

Mitsubishi (29%) Lancer (Rear) Toyota (6%) Camry (Rear) Honda (8%) Jazz

Customer Model

Toyota (55%) Fortuner, Vigo 4x4 Mitsubishi (100%) Strada, Triton

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SLIDE 14

14

BSK 35% Other 1% NHK 64%

BSK 22% NHK 78%

Market share Aug Y2008

Leaf Spring Leaf Spring

Market share Aug Y 2008

Stabilizer Bar Target 31% Stabilizer Bar Target 31%

33% 33.08% 0% 10% 20% 30% 40% 50% 2006 2007

Customer Model

Mitsubishi (29%) Lancer Honda (40%) Jazz/City/Accord (RR) Toyota (23%) New Altis (FR)

Customer Model

Toyota (51%) Fortuner, Vigo 4x4 Mitsubishi (100%) Strada, Triton Nissan (93%) Frontier 4x2, Navara

17% 17.53%

0% 10% 20% 30% 40% 50% 2006 2007

Customer Model

Mitsubishi (100%) Strada, Triton

Customer Model

Hino (1%) Bus Mitsubishi Fuso Truck (100%) Trucks

Market Share of Product Champions

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SLIDE 15

15

SBM 29% AISIN 45% KIRIU 4% OTHER 15% SBM 30% AISIN 65% OTHER 1% KIRIU 4% Market share Aug Y 2008

Disc Brake Target 27.7 % Disc Brake Target 27.7 %

Market share Aug Y 2008

Drum Brake Target 35 % Drum Brake Target 35 %

29% 35.18% 0% 10% 20% 30% 40% 50% 2006 2007

Mitsubishi Fuso Truck (89%) Trucks

23% 28.22% 0% 10% 20% 30% 40% 50% 2006 2007

Customer Model

Honda (100%) Jazz/City, Civic, Accord, CR-V Mitsubishi (22%) Space Wagon

Customer Model

Mitsubishi (100%) Strada, Triton Mitsubishi (100%) Strada, Triton Isuzu (66%) D-Max 4x4, 2x4, 4x2 (3,000 cc. only), MU-7

Customer Model

Honda (22%) Jazz/City

Market Share of Product Champions

Customer Model Customer Model

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SLIDE 16

16

SBM 22% AISIN 58% CALSONIC 2% OTHER 18%

Exhaust Manifold Exhaust Manifold

Market share Aug Y2008

22% 21.70% 0% 10% 20% 30% 40% 50% 2005 2006

Customer Model

Mitsubishi (51%) Lancer

Customer Model

Mitsubishi (85%) Strada, Triton AAT (100%) BT-50, Everest

Market Share of Product Champions

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SLIDE 17

17

Full Capacity and Utilization Rate

60% 240,000 90% 210,000 210,000

Axle Shaft

1,500 11,000 46,000 95,000 100,000 109,000 255,000 Pieces 2009E * 2008 2007 80% 95% 89% 75% 65% 79% 60%

%utilization

40% 255,000 120,000

Coil Spring

%utilization

Pieces Pieces Per Month 75% 46,000 46,000

Exhaust Manifold

65% 95,000 95,000

Drum Brake

50% 1,500 1,500

Leaf Spring (tons)

76% 11,000 11,000

Fly Wheel

51% 100,000 100,000

Stabilizer Bar

72% 109,000 109,000

Brake Disc

Note : Full Capacity = 500 hrs./month

  • Max. Capacity = 650 hrs./month

* To be revised in February 2009

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SLIDE 18

Agenda

  • Industry Overview
  • Group Business
  • Performance Review
  • Future Outlook
  • Appendices
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SLIDE 19

19

Financial Highlights

Unit: Bt.mn

3Q07 2Q08 3Q08 YoY QoQ YTD2007 YTD2008 YoY Sales 1,300 1,401 1,575 21% 12% 3,656 4,375 20% Total Revenue 1,339 1,437 1,603 20% 12% 3,748 4,476 19% GP 292 287 323 11% 12% 785 926 18% SG&A 102 87 99

  • 3%

15% 262 271 3% EBITDA 306 322 334 9% 4% 819 1,013 24% NOPAT 195 196 212 9% 8% 509 632 24% Net Profit 162 165 183 13% 11% 423 535 26% Total Assets 5,369 5,756 6,308 17% 10% 5,756 6,308 10%

  • Int. Bearing Debt

2,323 2,149 2,423 4% 13% 2,149 2,423 13% Total Liabilities 3,273 3,297 3,765 15% 14% 3,297 3,765 14% Equity 2,096 2,459 2,543 21% 3% 2,459 2,543 3% Depreciation 77 88 89 16% 1% 205 263 28% CAPEX 211 254 368 74% 45% 400 678 69% Effective Tax Rate 17.6% 18.4% 15.3% 19.9% 18.0%

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SLIDE 20

20

3Q07 2Q08 3Q08 YTD2007 YTD2008

GPM

(%)

22.46 20.49 20.50 21.46 21.17 EBITDAM

(%)

22.88 22.39 20.86 21.84 22.62 NPM

(%)

12.11 11.51 11.44 11.28 11.95 ROA (annualized)

(%)

12.82 12.40 12.56 10.56 12.21 ROFA (annualized)

(%)

30.66 31.07 29.77 25.60 29.05 EBITDA/CAPEX

(Times)

1.45 1.27 0.91 2.04 1.49 ROE (annualized)

(%)

33.50 29.45 31.61 25.10 30.74 ROCE (annualized)

(%)

23.92 23.25 23.34 20.40 23.79 ROIC (annualized)

(%)

18.33 18.06 17.81 15.63 17.69 IBD/Equity

(Times)

1.11 0.87 0.95 0.87 0.95 DER

(Times)

1.56 1.34 1.48 1.34 1.48

  • Int. Coverage

(Times)

9.41 10.56 11.63 9.54 10.42 EPS

(Bt.)

0.54 0.55 0.61 1.41 1.78 BVPS

(Bt.)

6.99 8.20 8.48 8.20 8.48

Key Financial Ratios

12.4 15.6 7.4 13.9 18.1 8.3

SECTOR => AH, STANLY, SAT, TSC, YNP

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SLIDE 21

21

Sales Breakdown

35% 36% 35% 33% 31% 14% 13% 10% 10% 11% 15% 14% 12% 12% 11% 6% 5% 5% 4% 5% 4% 4% 4% 5% 4% 6% 6% 6% 7% 7% 5% 7% 6%

15% 15% 21% 21% 25%

7% 6%

0% 25% 50% 75% 100%

3Q07 4Q07 1Q08 2Q08 3Q08 Domestic 95% OEM 97% 1,401 1,398

Axle Shaft Leaf Spring Disc & Drum Brake Exhaust Manifold Fly Wheel (+Comp) Stabilizer Bar Coil Spring Others

(i.e. Big Hub, Bracket, Timing Cover, Camshaft)

1,323

Bt.mn

1,300 1,575

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SLIDE 22

22

Customer Base

34% 29% 31% 32% 34% 24% 24% 24% 23% 21% 6% 5% 8% 8% 8% 6% 5% 17% 27% 23% 26% 10% 7% 9% 7% 5% 11% 5% 5% 25%

0% 25% 50% 75% 100% 3Q07 4Q07 1Q08 2Q08 3Q08

Mitsubishi Toyota Honda Isuzu AAT Others

Pickup+ PPV ~ 70%

Bt.mn

1,401 1,398 1,323 1,575 1,300

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SLIDE 23

23

Major Accomplishments in 2008

Financial Sales Operation

  • Interim dividend

0.30 bt./share

  • Developing

effective material cost management

  • 15% of growth,

significant number over previous year as planned

Award

  • Obtain “The

Excellent CG Company of the year” from SET

  • Maintain being

an A-class supplier of all major OEMs

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SLIDE 24

Agenda

  • Industry Overview
  • Group Business
  • Performance Review
  • Future Outlook
  • Appendices
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SLIDE 25

25

SAT strategy towards the global crisis

  • Gain market share of high margin product by

utilization of existing capacity

  • Penetrate into new market (other than

agriculture, home appliance) i.e. heavy industry

Sales Sales Sales

  • Construct dependable outsource
  • Delay approved investment i.e. ICP2,

I-machining line

  • Freeze manpower
  • Increase productivity to less unit cost

Operation Operation Operation

  • Have secured long-term credit lines under

favorable conditions

  • Lower inventory level

Liquidity Liquidity Liquidity

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SLIDE 26

26

Capital Expenditures Updated

Kubota (18 parts, 25K units) Kubota (10 parts, 50K units) ICP2 I-Machining Line ICP Land BSK Land New Coil Spring Line R&D Kubota (18 parts, 25K units) Forging Line H-Machining Line Unit : mn.bt Cash Payment Investment Amount Approved 110 110 11 2009 2008 N Y 110 2,656 130 1,219 276 43 48 285 55 183 163 254 240 925 130 10 6 285 5 55 4 146 3 276 8 22 7 1,219 9 163 2 254 1

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SLIDE 27

27

Project on Hand Updated (delayed)

SBG’s prospective orders (Coil Spring, Stabilizer Bar, Disc Brake and Drum Brake)

Suzuki: RFQ received Honda: RFQ submitted

(Disc &Drum-Jul 08, Coil Spring & Stabilizer Bar- Nov 08 ) : Confirmation expected ~ Feb 09

Nissan: Front & Rear Coil Spring Confirmed Toyota: Waiting for drawing MMth : Waiting for drawing (~ mid 09)

ECO ECO ECO CAR CAR CAR Back Back Back log log log

Bt 1,190 bn American Axle (GM Thailand) to

postpone production from May- 10 to Oct -11

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SLIDE 28

Agenda

  • Industry Overview
  • Group Business
  • Performance Review
  • Future Outlook
  • Appendices
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SLIDE 29

29

Details of 9M08 Thailand Car Production & Sales

Quarterly Overview Quarterly Overview Quarterly Overview Production Production Production Domestic & Export Sales Domestic & Export Sales Domestic & Export Sales

2007 2008

∆

1Q 293,635 365,623 25% 2Q 305,901 353,566 16% 3Q 333,870 349,243 5% Oct 123,845 124,656 1% YTD 1,057,251 1,193,088 13% 2007 2008

∆

1Q 292,790 359,286 23% 2Q 306,997 347,559 13% 3Q 345,053 353,344 2% Oct 116,350 116,473 0% YTD 1,061,190 1,176,662 11% 2007 2008

∆

1Q 138,270 161,736 17% 2Q 154,244 159,739 4% 3Q 158,812 139,783

  • 12%

Oct 57,860 48,942

  • 15%

YTD 509,186 510,200 0% 2007 2008

∆

1Q 154,520 197,550 28% 2Q 152,753 187,820 23% 3Q 186,241 213,561 15% Oct 58,490 67,531 15% YTD 552,004 666,462 21% Export Sales Production Total Sales Domestic Sales

Units % Units % %Growth Pick-up 1 Ton Toyota 295,599 38% 334,960 40% 13% Isuzu 191,738 25% 198,070 24% 3% Mitsubishi 138,635 18% 137,934 17%
  • 1%
AAT 112,662 15% 118,018 14% 5% Nissan 37,177 5% 45,686 5% 23% Others 0% 383 0% n.a Total Pick-up 775,811 100% 835,051 100% 8% Passenger car Toyota 116,721 45% 157,517 46% 35% Honda 118,498 45% 134,245 39% 13% Nisssan 11,500 4% 14,650 4% 27% Mitsubishi 3,370 1% 6,046 2% 79% Others 11,876 5% 30,183 9% 154% Total Passenger 261,965 100% 342,641 100% 31% Others Total Others 19,475 15,396
  • 21%
1,057,251 1,193,088 13% Production (YoY) 10M07 10M08 Units % Units % %Growth Pick-up 1 Ton Toyota 145,922 34% 201,171 39% 38% Mitsubishi 120,738 28% 116,503 22%
  • 4%
AAT 92,894 22% 102,966 20% 11% Isuzu&GM 67,910 16% 71,822 14% 6% Nissan 2,521 1% 26,241 5% 941% Others 0% 0% n.a Total Pick-up 429,985 100% 518,703 100% 21% Passenger car Toyota 40,722 33% 65,510 44% 61% Honda 65,332 54% 60,520 41%
  • 7%
Nissan 10,928 9% 7,449 5%
  • 32%
Mitsubishi 991 1% 3,684 2% 272% Others (GM,Bmw 4,046 3% 10,596 7% 162% Total Passenger 122,019 100% 147,759 100% 21% 552,004 666,462 21% 10M07 10M08 Export Sales (YoY) Units % Units % %Growth Pick-up 1 Ton Toyota 135,794 42% 115,849 41%
  • 15%
Isuzu&GM 120,970 38% 115,560 41%
  • 4%
Nissan 26,613 8% 20,176 7%
  • 24%
Mitsubishi 18,161 6% 16,754 6%
  • 8%
AAT 20,325 6% 12,989 5%
  • 36%
Others
  • 0%
157 0% n.a Total Pick-up 321,863 100% 281,485 100%
  • 13%
Passenger car Toyota 76,553 50% 88,627 46% 16% Honda 53,455 35% 72,145 37% 35% Nissan 3,970 3% 6,092 3% 53% Mazda 2,639 2% 3,318 2% 26% Mitsubishi 2,498 2% 3,201 2% 28% Others(Volvo,BM 14,056 9% 20,097 10% 43% Total Passenger 153,171 100% 193,480 100% 26% Others 509,186 510,200 0% Domestic Sales (YoY) 10M07 10M08
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SLIDE 30

30

Group Development

  • A well established and reputable vehicle parts manufacturer, with

concentration on the OEM market.

  • The Group started its automotive parts manufacturing business in

1962, and is considered as one of Thai pioneers in the business.

  • Establishment of

Somboon Spring Ltd.

  • Establishment of

Somboon Malleable Iron (SBM)

  • Establishment of Bangkok

Spring Industrial (BSK)

  • Began the move into OEM

market

1962

  • Establishment of

Somboon Advance Technology (SAT)

  • Start to

supply TOYOTA

  • Group

Restructuring

  • Listed
  • n

SET

1975 1977 1995 2002 2004 2005 2007

  • Acquiring ICP

by 100% shareholding

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SLIDE 31

31

Group Structure and Business

SAT

(Paid Up 300 mb)

SBM

(Paid Up 160 mb)

BSK

(Paid Up 130 mb)

Tsuchiyoshi Somboon Coated Sand

(Paid Up 72 mb)

Yamada Somboon

(Paid Up 150 mb)

Nishinbo Somboon Automotive

(Paid Up 732.6 mb)

Somboon Somic Manufacturing

(Paid Up 300 mb)

100% 100% 21.25% 20.00% 2.90% 1.80%

Somboon Holding 27% Kittapanich Family 26% Thailand Equity Fund 10% Others 37%

Sales ~ 200 mb, TA~ 235mb, GPM 10% , NPM 0.03% Sales ~ 1,760 mb, TA~ 1,630 mb, GPM 16% , NPM 5% Sales ~ 1,800 mb, TA~ 1,560mb, GPM 26% , NPM 20% Sales ~ 1,830 mb, TA~ 1,400 mb, GPM 20% , NPM 13%

  • Steering Column Assembly
  • Water Pump Assembly
  • Oil Pump
  • Ball Jointed
  • Tie Rod End
  • Outer Track Rod
  • Stabilizer Linkage
  • Brake System
  • Casting

(Rasin/Sand)

ICP

(Paid Up 185 mb)

100%

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SLIDE 32

32

Certificates and Awards

  • Group Company has been receiving many awards and accreditations of its

unique developing and its production quality-being rate as one of the finest in Supplier List.

  • Proven performance since inception in 1972 i.e., QCD grading, Quality Award by

MMth (zero defect), TPS (Toyota Production System), QCC award & network by HINO

  • ISO 9002, QS 9000, ISO 14001, ISO/TS 16949 (OEMs required)

Q Q Q M M M D D D C C C

SBG SBG

E E E

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SLIDE 33

Thank You Thank You

Somboon Advance Technology Public Company Limited –Investor Relations Department

  • Tel. + 66 728-8596, Fax. + 66 2 728-8513, Email: ir@somboon.co.th, http://www.satpcl.co.th

Questions and Answers