SELIC CORP OPPORTUNITY DAY QUARTER 3/2018 DATE: December 18, 2018 - - PowerPoint PPT Presentation

SELIC CORP OPPORTUNITY DAY

QUARTER 3/2018 DATE: December 18, 2018

Selic Corp Public Company Limited

ABOUT SELIC

We provide solutions for adhesive, our offer includes customized products and services that match our customers’ needs.

Facts & Figures

23

นักเคมี และเทคนิคใน ทีมวิจัยและพัฒนา

4

ห ้ องปฏิบัติการ และการ วิเคราะห์

38

ปี แห่งประสบการณ์ และความเชี่ยวชาญใน อุตสาหกรรม

4

เทคโนโลยีกาวที่ผลิต ได ้ เอง

9,120

ตัน ก าลังการผลิต

3-5%

ของรายได ้ ที่เป็น งบประมาณด ้ าน นวัตกรรม

27

ประเทศ ครอบคลุม ตลาด

กาว solvent

เป็นกาวที่อยู่ในสถานะ ของเหลว ใช ้ ตัวท าละลาย ประเภท Solvent ในกลุ่ม ของน ้ามัน หรือทินเนอร์ เป็นตัวท าละลาย

กาวน ้า

เป็นผลิตภัณฑ์กาว สังเคราะห์และใช ้ น ้าเป็น ตัวละลาย ท าให ้ กาวมี สภาพเป็นของเหลว ใช ้ งานง่าย

กาว hot melt

มีคุณลักษณะเป็นของแข็ง ใช ้ งานผ่านความร ้อนเพื่อให ้ กาว ละลายกลายเป็นของเหลวเมื่อ เนื้อกาวเย็นลง จะยึดติดวัสดุ 2 ชิ้นเข ้ าด ้ วยกัน

กาว hot melt PUR

เป็นกาวในกลุ่ม hot melt แต่ ต่างกันที่คุณสมบัติคงทน โดย เมื่อเกิดการยึดติดแล ้ วจะไม่ แปลงสภาพเหมาะกับงานที่ ต ้ องการความทนทาน

Adhesive Technologies

Our customers in various industries across 27 countries

Food & beverage Consumer products Printing Furniture Construction Automotive Footwear Etc.

FINANCIAL INFORMATION

417.42 434.32 446.20

Q1-3/2016 Q1-3/2017 Q1-3/2018 9M

133.26 153.29 150.78

Q3/2016 Q3/2017 Q3/2018 +11.88MB +2.74%

Consolidated FS

• 2.51 MB
• 1.5%

3M

Revenue growth +2.74% for the 9-month period

Slight decline of -1.5% observed for the quarter compared to previous year.

(Unit : MB)

Domestic sales recorded growth while export sales decline

Consolidated FS

The decline in export sales is due to the political uncertainty in South Asia and South Africa regions.

(Unit : MB)

85.16 88.06 68.14 62.72

Q3/2017 Q3/2018

Domestic International

Hotmelt and water based adhesive grow according to plan and align with global market demand

Unit: Million Baht

Solvent

• 7.38% YOY

(-19.01 MB)

Hotmelt

257.72 238.72 9M/2017 9M/2018 137.51 160.44 9M/2017 9M/2018

Unit: Million Baht

+16.7% YOY (+22.92 MB)

29.35 36.40 9M/2017 9M/2018

Unit: Million Baht

Water Based

+24.0% YOY (+7.05 MB)

Profitability

Consolidated FS Gross Profit Margin

(exclude other revenue)

3.17% 3.52% 1.07% 2017 Q1-3/2017 Q1-3/2018

Net Profit Margin

Gross profit margin decreases by 8.8% from the first 9 month period while net profit margin down to 1.07%.

25.84% 26.76% 23.72% 2017 Q1-3/2017 Q1-3/2018

Q3/2018 Net Profit

Consolidated FS

18.72 2.96 4.06 2017 Q3/2017 Q3/2018

Net Profit

3.17% 1.93% 0.02% 2017 Q3/2017 Q3/2018

Net profit =0.04MB, decreased due to the Non-Recurring transaction cost of M&A amounted to 4.06 MB in Q3/2018

Non-Recurring Cost 4.06MB Non-Recurring Cost 2.69% of Revenue

Net Profit Margin

0.04

PMC GROUP ACQUISITION

PMC Group

Type of Business Manufacturer of self-adhesive labels Sales and distribution of PMC’s products in Singapore Address Khok Kham, Muang Samut Sakhon District, Samut Sakhon 74000 Loyang Industrial Estate #02-20, 30 Loyang Way, 508769 Corporate Type Company Limited Private Company Limited Registration Date 20 April 2004 1 March 2004 Registered Capital THB 100,000,000 SGD 2 PMC Label materials Pte Ltd. (Singapore) PMCS PMC Label materials Co., Ltd. (Thailand) PMCT

FOUNDER

100.0% 100.0%

Composition of Self-Adhesive Label

Production Process

Self-Adhesive Label

Strong Market Presence

1

Rank one of Top 4 in Thailand Market

3041 2207 1031 772 836 486

9.8% 0.3% 3.6% 11.6% 2.9%

0.0% 5.0% 10.0% 15.0% 1000 2000 3000 4000 Avery Dennison (Thailand) Thai KK Industry Oji Label (Thailand) PMC Label Materials Lintec (Thailand) UPM Raflatac

Revenue Margin Source: Department of Business Development

2

Net Profit was about 10% on average

828 811 852 122 122 148 14.8% 15.0% 17.3% 9.6% 9.7% 11.7%

100 200 300 400 500 600 700 800 900

2015 2016 2017

Revenue EBITDA %EBITDA %NP

Stable Financial Performance

Combined FS

3

• ISO:9001:2008 Certified for

Quality Management System Certification from the United Kingdom Accreditation Service (UKAS)

• Restriction of Hazardous

Substances (ROHS) compliance

High Quality Standard and Compliance

Good International Distribution Network

4

>12 Countries Worldwide

Various type of Product Category

Product

Common Paper Prime Label Films Industrial Label Films Variable Imprintable Thermal Transfer Variable Imprintable Direct Transfer Specialty Facestock Type Paper Film Film Paper or Film Paper of Film Paper of Film

Usage

• Health &

Beauty Aids

• Food &

Beverages

• Pharmaceutic

als

• Consumer

packaging

• Health &

Beauty Aids

• Food &

Beverages

• Consumer

packaging

• Product ID
• Industrial

Labeling

• Chemical Drum

Label

• Product ID
• Logistic Tracking

Label

• Industrial Labeling
• Baggage Tags
• Weighing Scale
• Retail Shelf
• Ticketing
• Advertisement
• Decoration
• Security labels

5

Transaction Overview

Transaction Structure and Estimated Size

• No. of shares

% shareholding THB million PMCT 1,000,000 100% up to 945 PMCS 2 100% up to 105 Total up to 1,050

PMC Label Materials Co., Ltd. (PMCT) E.V.A. International Co., Ltd (EVA) PMC Label Materials Pte, Ltd. (PMCS)

99.97% 100.00% 100.00%

Company Structure Post Transaction

Transaction Overview

Transaction Timeline

October November December January 2019 BOD resolution Share Purchase SELIC’s EGM Transaction complete

19 14 4

Sources of Fund

• The Company will use cash on hand and operating cash flow of Baht 150-200

million, and a long term loan from a financial institution amounting up to Baht 900 million (this loan has already been approved by the financial institution), as approved by the Board of Directors.

Benefits & Value Creation Opportunities

Increase Revenues and Profits Market Expansion and Coverage Operations Synergy

Benefits & Value Creation Opportunities

Increase revenues and profits

THB million

595 845.7

1440.7

500 1000 1500

SELIC PMC Combined

47.02 147.6

194.62

100 200 300

SELIC PMC Combined

THB million

2017 REVENUE : combined 1,440.7 Million Baht 2017 EBITDA : combined 194.62 Million Baht

Benefits & Value Creation Opportunities

Increase revenues and profits

Combined P&L Selic and PMC

Baht in thousands FY16 Audited FY17 Audited 9M18 Unaudited Revenue 1,367,231.40 1,437,633.46 1,094,260.92 Cost of sales (1,007,819.33) (1,071,740.35) (816,761.67) Gross profit 359,412.07 365,893.11 277,498.79

• Selling expenses

(27,218.16) (30,117.76) (19,974.77) Administrative expenses (186,414.79) (191,299.78) (149,796.07) Operating profit 145,779.12 144,475.57 107,727.95 Other income 5,234.98 3,563.48 4,231.88 Gain on forex 3,025.00 5,783.00 1,286.04 EBIT 154,039.10 153,822.05 113,245.87 Finance cost (11,366.44) (6,823.03) (3,614.18) EBT 142,672.66 146,999.02 109,631.69 Income tax (24,920.95) (28,859.47) (19,877.72) Net income 117,751.72 118,139.55 89,753.97

Adhesive Value Chain Analysis Opportunity to expand vertically into Converted Product Producer. This offer new channels of distribution for SELIC Market Expansion & Coverage

Benefits & Value Creation Opportunities

Market Expansion & Coverage

Benefits & Value Creation Opportunities

Product extension in label market

• Glue applied label
• Self adhesive label

Operations Synergy

Benefits & Value Creation Opportunities

Overseas Footprint Expansion

• Leverage strong oversea

network to expand export market for PMC

• Potential of regional office

in Singapore for MNC companies Technology Synergy

• Strong R&D focused from

SELIC

• Adhesive for specialty

labels such as removable stickers, deep freeze resistant labels Operations Synergy

• Potential reduction on

inventory and raw material categorization

• Cost and expertise sharing

Q & A

This Presentation is not intended to provide the basis for any investment decision, nor to substitute your own analysis and investigation, and should not be considered as a recommendation to any recipient of this Presentation. Some statements made in this presentation are forward-looking statements, which are subject to various risks and uncertainties. These include statements with respect to the Company’s corporate plans, strategies and beliefs and other statement that are not historical facts. These statement can be identified by the use of forward-looking terminology such as “may”, “will”, “expect” , “intend”, “estimate”, “continue”, “plan” or other similar words. The statements are based on the assumptions and beliefs of the Company’s management in light of the information currently available to the Company. These assumptions involve risks and uncertainties which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Nothing in this Presentation is, or should be, relied on as promise or representation of the Company as to the future.

270 Liapkhlongphasicharoenfangtai Road, Nongkhaem, Bangkok 10160, THAILAND Phone : +662 807 3347 Email : explore@seliccorp.com Website : www.seliccorp.com Facebook : Selic.Thailand