SET OPPORTUNITY DAY 2Q17 RESULTS PRESENTATION 2Q17 RESULTS - - PowerPoint PPT Presentation

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SET OPPORTUNITY DAY 2Q17 RESULTS PRESENTATION 2Q17 RESULTS PRESENTATION 14 SEPTEMBER 2017 1 Disclaimer Certain forward looking statements may be made in the course of the presentation. These forward looking statements generally can be


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SET OPPORTUNITY DAY 2Q17 RESULTS PRESENTATION 2Q17 RESULTS PRESENTATION 14 SEPTEMBER 2017

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Disclaimer

Certain forward looking statements may be made in the course of the presentation. These forward‐looking statements generally can be identified by use of statements that include words or phrases such as LST UPOIC statements generally can be identified by use of statements that include words or phrases such as LST , UPOIC and UFC or we or our management “believe”, “expect”, “anticipate”, ”intend”, ”plan”, ”foresee”, ”project”, ”may”, “will”, “shall”, or other similar words or phrases. Similarly, statements that describe LST , UPOIC and UFC ’s objective, plans or goals also are forward‐looking statements. These statements involve known and unknown uncertainties and risks that could differ materially from actual results, performance or events. The forward‐looking statements contained in the slides are not and should not be constructed as representations of the future performance of LST , UPOIC and UFC and that such statements are an expression

  • f the Company’s reviews based on its current view and certain assumptions including, but not limited to,

ili i d k t diti d tl il bl i f ti Th d th li t i prevailing economic and market conditions and currently available information. The reader or the listener is cautioned to not unduly rely on these forward‐looking statements. We do not undertake any duty to publish any update or revision of any forward looking statements. 2

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SLIDE 3

Agenda

  • Company Overview (LST)
  • Company Overview (UPOIC)

I d t O i

  • Industry Overview
  • Financial Overview (UPOIC)
  • Financial Overview (LST)
  • Business Overview (UFC)

( )

  • Q&A

3

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SLIDE 4

Agenda

  • Company Overview (LST)
  • Company Overview (UPOIC)

I d t O i

  • Industry Overview
  • Financial Overview (UPOIC)
  • Financial Overview (LST)
  • Business Overview (UFC)

( )

  • Q&A

4

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SLIDE 5

Philosophy of Lam Soon Group

Vision

“The leading food and food related company with sustainable growth and development”

i i Mission

  • Manufacturing high quality and nutritious food product together.
  • Employing advance technology
  • Employing advance technology.
  • Building trust and confidence toward our customers.

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SLIDE 6

Our Development

1974 Bangkok Edible Oil was founded 1978 Established Vegetable Oil Refinery at Bang Poo Industrial Estate

estone

1983 Lam Soon (Thailand) Co,. Ltd was established 1996 LST was listed on the Stock Exchange of Thailand 2003 Became a major shareholder of “UPOIC” 2004 A i i i f “UFC”

porate Mile

2004 Acquisition of “UFC” 2008 ‐Joined the Roundtable on Sustainable Palm Oil (RSPO) ‐ Constructed Biogas power plant at Trang mill 1974 1978 1996 1983 2004 2003 2008 2007 2006 2009 2011 2012 2017

Corp

1974 1978 1996 1983 2004 2003 2008 2007 2006 2009 2011 2012 .. 2017

ent

2006 Launched new product targeted at health conscious consumers under the brand “Naturel” 2007 Implemented Electricity power project under Clean Development Mechanism (CDM) and Carbon Credit Program

Developm

2009 “Jade” palm cooking oil was the first cooking oil awarded “Carbon Label” 2011 Launched soy milk products under the “UFC HomeSoy” 2012 UFC Launched Coconut water 2013 UFC launched “Chrysanthemum plus Lo Han Gua” l h d h l h l d “ ” b d

Product

2014 LST launched the multipurpose ‐ chocolate under “Daisy” brand 2015 LST launched Naturel 100% Coconut cooking oil and Naturel 100% Sunflower cooking oil. LST lauched Yok Extra and Naturel Rice Bran Oil Gold UFC lauched "The Asian Variants" 100% coconut water with real juice , Homesoy new flavor and Chooze new flavor. 2016

6

LST launchedNaturel Forte 100% Extra Virgin Coconut Oil UFC launched new flavor Homesoy , UFC velvet almond milk , Bio‐ Home dishwash liquid and Bio‐Home kitchen cleaner & multi surface cleaner 2017

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SLIDE 7

Group Structure

Lam Soon (Thailand)

98.83% 69.96%

UFC UPOIC

100 00% 50.00% 99.98%

Union Frost Siam Elite Palm Phansrivivat

100.00% 99.99% 99.99%

Phansri (Concession – Chaiburi) Prachakvivat (Concession – Khiansa)

7

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SLIDE 8

Strong Fundamental i.e. Fully Integrated Supply Chain

R M i l A i i i P d i S l & M k i Raw Material Acquisition Production Sales & Marketing Nursery Plant Oil Palm Plantation Crushing Mill Value Adding Refinery Distribution Channel Germinated Seeds Start from nursery plant to ensure product quality 2 locations in Trang and Krabi with combined capacity 120 Oil palm planted area

  • f 31,341 rai

Total capacity 368,650 tons /year Build Awareness and brand recognition JV with CIRAD to develop own palm seeds species quality capacity 120 tons FFB / hr. Cost saving from integrated species integrated distribution channel

  • f LST and UFC

Fully Traceability – Quality & Profitable

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SLIDE 9

Symbols of Excellence

HACCP ISO 9001 ISO 14001 GMP OHSAS / TIS 18001 HALAL FSSC 22000 ISO 28000 TLS 8001 RSPO

9

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SLIDE 10

Our Products

Upstream Core Products Diversify

Seedling Germinated Seeds Seeds

Other Products

Crude Palm Oil Crude Palm Kernel Oil Electricity Power from Biogas

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SLIDE 11

Naturel Forte 100% Extra Virgin Coconut Oil

NATUREL FORTE 100% EXTRA VIRGIN COCONUT OIL High medium chain triglyceride (MCT) Help to activate metabolism of human body Good for hair and skin moisture. One for all healthy menus … Good Health Join the Naturel One for all healthy menus … Good Health Join the Naturel Living.

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SLIDE 12

New Flavor! Homesoy (Soy Milk & Basil Seed)

The new product combines Homesoy authentic soy milk flavors with health benefits of the basil seeds making it a uniquely mouth watering convenient and healthy beverage The soy milk mouth‐watering, convenient and healthy beverage. The soy milk is contained in aluminum can 180 ML with 3 more variants to select original, ginger, and ginger with basil seeds. Homesoy is made from carefully selected premium soy beans from Canadian soybean, all ingredients are 100% natural with no added preservatives, animal fats, and dairy product. The soy milk is less

  • sweet. The Heart Foundation of Thailand under the Royal

Patronage endorses Homesoy as a healthy beverage Patronage endorses Homesoy as a healthy beverage. Now available in hypermarkets and supermarkets nationwide.

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UFC Velvet Almond Milk

UFC Velvet Almond Milk is a heart‐healthy, low‐calorie and nutritious beverage made from the quality Australian whole almonds and water. Almond milk has a pleasant, nutty flavor p , y and creamy texture. It is added with “Aquamin” 100% natural marine plant‐based calcium. Derived from the red algae Lithothamnion found in the pristine waters off the coast of I l d Th l t b d l i t ll b b t

  • Iceland. The plant‐based calcium naturally absorbs trace

minerals from the surrounding seawater, making it easier for your body to absorb and store the calcium. The almond milk is a plant‐based alternative to traditional dairy milk, suitable for vegans and those who are lactose intolerant or allergic to dairy milk. No cholesterol Trans fat free Contains healthy fats and vitamin E No artificial flavor, color, or preservatives added Add d ith l i Almond Milk : 2 Flavors ‐Original ‐Unsweetened Added with calcium

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Bio‐Home / Dishwash Liquid

Bio‐Home is an innovative eco friendly dish wash liquid. The product is available in two scents lemongrass & green The product is available in two scents, lemongrass & green tea and lavender & bergamot. With the stylish recyclable plastic bottle 500 ml, Bio‐Home uses 100% biodegradable plant‐based ingredients giving a great product experience p g g g g p p to all users. It leaves no residue, fresh aroma, gentle to human’s hands with the pH‐balanced formula, and reduce water use. This product has been certified by “Green Label” and is considered an environmental friendly product and is considered an environmental‐friendly product. Now available in hypermarkets and supermarkets nationwide.

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SLIDE 15

Bio‐Home Kitchen Cleaner & Multi‐Surface Cleaner

Bio‐Home Kitchen Cleaner (Lemongrass & Green Tea) made from non‐toxic biodegradable 100% plant‐based active made from non toxic, biodegradable, 100% plant based active ingredients that remove tough grease and grime stains effectively in your kitchen areas. This product is formulated to be rinse‐free, making your kitchen chores much easier without having to wipe it the second

  • round. The product is saved for human skin and kitchen equipment. The

liquid is contained in stylish recyclable plastic spray bottle (500 ml). Bio‐Home Multi‐Surface Cleaner (Lemongrass & Green Tea) is a general all‐purpose cleaning solution for your daily needs. Featuring a rinse‐free formula that makes cleaning less of a hassle and ensures that the cleaned surface is free from any dirt and dust. It can be used

  • n any types of surface such as wood, marble, and veneer without

leaving any toxic chemicals The product is 100% biodegradable plant‐ leaving any toxic chemicals. The product is 100% biodegradable plant based & renewable active ingredients, therefore it is saved for human

  • skin. The liquid is contained in stylish recyclable plastic spray bottle (500

ml).

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SLIDE 16

Share Capital Information

Symbol LST Share Price ( 12 SEP 2017) 8.45 THB Stock Information

Major Shareholders (As of May 9, 2017) Percentage of Paid‐up Capital (1) Lam Soon Holding Co., Ltd. 42.11 (2) Hap Seng Consolidated Berhad 20.00 (3) L S C P L d 7 48

Historical price :

  • 52‐week high

8.75 THB

  • 52‐week low

3.40 THB No of paid up shares : 820 Million

(3) Lam Soon Cannery Pte Ltd. 7.48 (4) CIMB Securities (Singapore) Pte Ltd 6.47 (5) RAFFLES NOMINEES (PTE) LIMITED 4.53 (6) CIMB Securities Limited 1.62 (7) Mr. Suwit Laohapolwattana 1.49 (8) Ms Supaporn Smittinun 1 32

  • No. of paid up shares :

820 Million Par value : 1 THB/Share Market Capitalization : THB 6,929 mn.

Source: www.setsmart.com

(8) Ms. Supaporn Smittinun 1.32 (9) Thai NVDR Co.,Ltd. 1.04 (10) Ms.Arunee Wongwalapaporn 0.65 (11) Mr. Niti Chongsawadchai 0.65 (12) Ms. Nalin Chongsawadchai 0.65 (13) The Hongkong and Shanghai Banking 0 64

3 years share price performance (%) Dividend Payout Policy

The Company’ s policy is to pay dividends to shareholders of an amount not less than 40% of its net earnings after tax subject to the Company’s future investment d f di i t

Source: www.setsmart.com

(13) The Hongkong and Shanghai Banking 0.64 and funding requirements. 51.3% 42.6% 58.8% 60.0% 59.4% 40.0% 50.0% 60.0% 70.0% 0.60 0.80 1.00 0.39 0.47 0.34 0.25 0.17 0.20 0.20 0.20 0.15 0.10 0.0% 10.0% 20.0% 30.0% ‐ 0.20 0.40 2012 2013 2014 2015 2016

Source: www.setsmart.com

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EPS (Baht/Share) DPS (Baht/Share) Dividend Payout Ratio (Based on operational year)

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Agenda

  • Company Overview (LST)
  • Company Overview (UPOIC)

I d t O i

  • Industry Overview
  • Financial Overview (UPOIC)
  • Financial Overview (LST)
  • Business Overview (UFC)

( )

  • Q&A

17

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UPOIC’s Philosophy

Vision

“The leading sustainable palm oil business company with operational excellence, international b d ld l h ” best practices, and world‐class competitive strengths.”

Mission

  • Building capacity in entire palm oil business value chain from seeding, germinating, plantation, crop oil extraction and related

business so as to be competitive and recognizing in the future

  • Performing the high value palm oil business by focusing in research and development of palm seed breeding of seed with

high yield and adaptable to a range of cultivation area to fulfill grower requirements as well as providing the best services. g y p g g q p g

  • Employing advanced technology in production, research and development with international management system as well as

taking care of the environment, biodiversity, communities, and society.

  • Always ensuring the health, safety, and welfare of all employees and building trust and confidence among our customers,

grower/suppliers and generate return to shareholders and other stakeholders appropriately.

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g o e /supp e s a d ge e ate etu to s a e o de s a d ot e sta e o de s app op ate y

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Corporate Milestones

UPOIC was established Issuing new share in exchange for an 100% stake in Phansrivivat UPOIC entered into a joint venture with CIRAD to form Siam Elite Palm Co., Ltd.

1978 1991 1997 1994 2003 2006

established stake in Phansrivivat

2008 1978 1991 1997 1994 2003 2006

UPOIC was 1997 LST began

2008

listed company

  • n the Stock

Exchange of Thailand (SET) purchasing UPOIC shares 2003 LST acquired more shares in UPOIC , and as a Joined the result became the major shareholder of UPOIC Joined the Roundtable on Sustainable Palm Oil (RSPO) (RSPO) 19

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Share Capital Information

Stock Information

Symbol UPOIC Major Shareholders as of May 9,2017 Percentage of Paid‐up Capital (1) Lam Soon (Thailand) Plc. 69.96 (2) Wattanachote Co., Ltd. 5.70 Share Price ( 12 SEP 2017) 5.80 THB Historical price :

  • 52‐week high

7.95 THB

  • 52

eek lo 5 55 THB ( ) , (3) Mr. Somkiat Peetakanonda 1.68 (4) Mr.Thammanoon Sahadithdamrong 1.17 (5) Wattanasophonpanich Co., Ltd. 1.12 (6) Thai NVDR Co., Ltd. 0.98 (7) M D k l Th i 0 74

  • 52‐week low

5.55 THB

  • No. of paid up shares :

324.05 Million Par value : 1 THB/Share Market Capitalization : THB 1,879 mn. (7) Ms.Duangkamol Thanissaranont 0.74 (8) GreenSpot Co., Ltd. 0.73 (9) Mr. Chawalit Tsao 0.71 (10) Mrs. Nancy Chalermkanjana 0.63

Source: www.setsmart.com

Dividend Payout Policy

UPOIC has a policy of paying not less than 50% of net profit after tax as

3 years share price performance (%)

0.90 0.60 89.1% 88.2% 57.7% 54.1% 80% 100% 1.00 1.50

UPOIC has a policy of paying not less than 50% of net profit after tax as dividend.

1.01 0.68 0.52 ‐0.02 0.28 0.60 0.30 0.15 0.15 0.0% 0% 20% 40% 60% ‐0.50 ‐ 0.50 2012 2013 2014 2015 2016

Source: www.setsmart.com

Remark : Dividend payment for year 2015 was paid from retain earning

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2012 2013 2014 2015 2016 EPS (Baht/Share)

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Agenda

  • Company Overview (LST)
  • Company Overview (UPOIC)

I d t O i

  • Industry Overview
  • Financial Overview (UPOIC)
  • Financial Overview (LST)
  • Business Overview (UFC)

( )

  • Q&A

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FFB Output in Thailand (2006 – 1H2017)

Generated from 5 million rai of harvested area, FFB output in 2017 expected to be 15‐20% higher than 2016 due to the good weather condition.

‘000 MT 000 MT

48.1% 49.4% 50.0% 60.0% 12,000 14,000 32.0% 18.5% 30.0% 40.0% 8,000 10,000 ‐5.3% ‐0.6% 5.5% 11.4% ‐4.2% 0.9% 0.0% 10.0% 20.0% 4,000 6,000 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1H17 ‐13.3% ‐12.5% ‐20.0% ‐10.0% ‐ 2,000

l d

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1H17 FFB Output 6,540 6,195 9,254 8,021 7,976 10,529 11,106 12,373 11,859 11,968 10,478 6,527 % Growth 48.1% ‐5.3% 49.4% ‐13.3% ‐0.6% 32.0% 5.5% 11.4% ‐4.2% 0.9% ‐12.5% 18.5%

Source: Internal Trade Department

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SLIDE 23

CPO Production in Thailand (2006 – 1H2017)

‘000 MT

CPO production in 2017 turns to be normal level at 2 million MT with the following usage:‐ 1) Consumption and Industrial use 900,000–1,000,000 MT; 2) Bio‐diesel (B5‐B7) 1,000,000 MT ; 3) Potential export 80,000 ‐100,000 MT.

000 MT 2,135 2 068 48.9% 46.9% 42.3% 50.0% 60.0% 2 000 2,500 1,544 1,345 1,288 1,832 1,891 2,001 2,068 1,804 26.70% 30.0% 40.0% 1,500 2,000 1,168 1,052 1,137 3.2% 12.9% 3.4% 10.0% 20.0% 1,000 ‐9.9% ‐12.9% ‐4.3% ‐6.3% ‐12.8% ‐10.0% 0.0% 500

S I l T d D

‐20.0% Y2006 Y2007 Y2008 Y2009 Y2010 Y2011 Y2012 Y2013 Y2014 Y2015 Y2016 1H2017 CPO FOR FOOD,INDUSTRIAL USE, EXPORT CPO USED BY BIO‐DIESEL % GROWTH

23

Source: Internal Trade Department

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Monthly FFB Output and FFB Price

FFB output in the Kingdom was much higher than the same period of last year thanks to the good weather condition and continual raining.

‘000 MT Baht/ K.G.

7.02 6 13 6 14 7.00 8.00 3,000

FFB Output and FFB Price (O.E.R.18%)

5.70 5.48 4.95 5.60 5.81 5.91 6.13 5.83 5.91 5.85 5.87 5.77 6.14 5.49 4.89 4.78 4.32 4.00 5.00 6.00 7.00 1,500 2,000 2,500 1.00 2.00 3.00 500 1,000 , Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Output '15 451 683 1,193 1,449 1,573 1,224 1,030 947 982 989 826 623 Output '16 538 717 1,063 1,158 1,096 908 806 876 920 834 812 750 ‐ ‐ Output '17 629 716 1,156 1,398 1,484 1,145 Price '15 6.48 6.61 5.26 4.69 4.61 5.14 4.46 4.29 3.86 4.34 4.71 5.00 Price '16 5.70 5.48 4.95 5.60 5.81 5.91 7.02 6.13 5.83 5.91 5.85 5.87 Price '17 5.77 6.14 5.49 4.89 4.78 4.32

Source: Internal Trade Department

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Price 17 5.77 6.14 5.49 4.89 4.78 4.32

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SLIDE 25

Monthly CPO Production and Oil Extraction Rate (O.E.R.)

O.E.R. ‘000 MT

Average OER (nearly 18%) in Thailand improved from last year however it was much lower than 20% as the standard level in Malaysia who targets to improve to 25% within 2020

17.9% 16.7% 16 5% 16 2% 16 3% 18.0% 18.7% 18.3% 18.4% 18.0% 17.7% 17.0% 17.2% 17.3% 17.3% 17.6% 17.8% 16.0% 18.0% 20.0% 300 350 400 16.5% 16.2% 15.4% 16.3% 8.0% 10.0% 12.0% 14.0% 150 200 250 300 0 0% 2.0% 4.0% 6.0% 50 100 150 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec CPO 2015 70 105 188 227 268 218 183 174 177 185 152 122 CPO 2016 96 120 176 188 168 148 145 164 168 153 146 132 CPO 2017 108 123 200 241 261 203 0.0% ‐ CPO 2017 108 123 200 241 261 203 O.E.R. '15 16.6% 16.0% 16.3% 16.0% 16.6% 17.5% 18.2% 18.4% 18.6% 18.7% 18.9% 18.6% O.E.R. '16 17.9% 16.7% 16.5% 16.2% 15.4% 16.3% 18.0% 18.7% 18.3% 18.4% 18.0% 17.7% O.E.R. '17 17.0% 17.2% 17.3% 17.3% 17.6% 17.8%

Source: Internal Trade Department

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Thailand CPO Stock Equivalent and CPO Price

‘000 MT Baht/ K.G.

CPO output in the Kingdom increased dramatically; therefore, the nationwide CPO stock at the end of June increased to 454,182 MT . Price decreased to 23.84 Baht/K.G.

29.63 30.10 29.02 32.26 33.93 35.50 37.49 34.00 31.05 30.00 29.63 30.80 30 00 35.00 40.00 600 700 800 31.40 31.97 28.97 26.91 26.77 23.84 20.00 25.00 30.00 400 500 600 5.00 10.00 15.00 100 200 300 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec CPO Stock 2015 117 156 203 285 385 449 450 462 448 449 394 335 CPO Stock 2016 261 215 195 213 220 223 217 229 259 290 297 293 CPO Stock 2017 237 221 275 359 448 454

  • CPO Stock 2017

237 221 275 359 448 454 CPO Price 2015 35.44 36.39 28.54 26.15 26.17 27.43 26.22 25.29 21.50 23.94 24.94 26.00 CPO Price 2016 29.63 30.10 29.02 32.26 33.93 35.50 37.49 34.00 31.05 30.00 29.63 30.80 CPO Price 2017 31.40 31.97 28.97 26.91 26.77 23.84

Source: Internal Trade Department

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SLIDE 27

Malaysia Production of Crude Palm Oil

‐ 2017F : 19 million MT ‐ 2016 : 17.3 million MT ‐ 2015 : 20 million MT

‘000 MT ‘000 MT 2,500 Y2015 Y2016 Y2017 2,000 1,000 1,500 500 Jan Feb Mar Apr May June Jul Aug Sep Oct Nov Dec

Source : Malaysian Palm Oil Board

27

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SLIDE 28

Malaysia Palm Oil Stock

Palm oil stock in Malaysia was not as high as earlier expected due to strong demand for export.

‘000 MT

3,000 Y2015 Y2016 Y2017 2 000 2,500 1,500 2,000 500 1,000 Jan Feb Mar Apr May June Jul Aug Sep Oct Nov Dec

28

Source : Malaysian Palm Oil Board

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SLIDE 29

Comparison of CPO Wholesale Price Between Bangkok and Malaysian Market

CPO price difference reduced to less than 5 Baht/K.G. when compared to CPO price in global market.

.59 6 5 3

Baht/K.G.

15.77 24.45 28.96 24.33 29.10 36. 30.86 25.24 28.57 27.33 31.95 28.31 15.73 24.80 28.56 21.96 27.02 32.6 28.89 23.27 24.05 19.24 22.72 23.45 20.00 30.00 40.00 ‐ 10.00 Y2006 Y2007 Y2008 Y2009 Y2010 Y2011 Y2012 Y2013 Y2014 Y2015 Y2016 1H17 CPO Wholesale Price in Bangkok market CPO Wholesale Price in Malaysian market

Source: Internal Trade Department

CPO Wholesale Price in Bangkok market CPO Wholesale Price in Malaysian market

Source: http://www.indexmundi.com

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SLIDE 30

Global consumption of vegetable oils from 1995/1996 to 2016/2017, by oil type

Palm oil contributes the highest portion at 35% of global consumption of vegetable oils , followed by Soybean oil.

Million MT

23 9 23.2 23.7 145 4 151 9 157.7 159.1 171.8 178.3 184.1 200.0 53 2 22 4 23.3 23.7 23.7 24.3 27.2 27.8 27.7 9 8 10 3 9.4 10.6 11.4 11.8 13.0 13.2 13.0 14.2 14.9 15.6 19.8 20.0 20.5 20.9 21.2 22.0 22.8 23.2 23.7 23.9 23.2 115.4 121.2 125.1 129.7 137.8 145.4 151.9 100.0 150.0 37 7 39 4 42 1 44 5 47 6 50 2 55.0 55.5 58.5 61.0 64.0 19 7 33.6 35.6 37.5 36.0 38.3 40.7 42.2 42.6 42.7 48.0 51.5 53.2 11.2 16.9 17.6 18.3 20.1 22.4 8.6 9.8 10.3 16.4 71.7 50.0 15.8 35.3 37.7 39.4 42.1 44.5 47.6 50.2 55.0 55.5 19.7 ‐

Source : Statista.com

Palm Oil Soybean Oil Canola Oil Sunflowerseed Oil Other 30

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SLIDE 31

Price Comparison of Other Oil Types

31

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SLIDE 32

Factors affecting world palm oil industry in 2H2017

  • Pretoleum price would be higher after a hurricane shut

down more than 19% of the USA’s refinery capacity

Price of Petroleum

  • Rising demand of soy bean oil in china and concern of cold
  • Rising demand of soy bean oil in china and concern of cold

and dry weather could impact to US crop in this year that will effect to soy bean oil price.

Price of Soybean Oil

Ri i h b d i 4 10 RM/USD

  • Ringgit has been expected to appreciate to 4.10 RM/USD

by year‐end.

Ringgit Currency

32

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SLIDE 33

US Soy Oil Futures Daily Chart

33

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SLIDE 34

USDMYR:CURRENCY (1Y)

Source: Bloomberg

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SLIDE 35

Factors affecting world and domestic palm oil industry in 2018

  • Lower energy values due to fear of global supply and high inventory

put pressure on palm oil as the palm oil often takes price direction for P l i Wi h h f lli il i h l G li

Petroleum Price and

Petroleum price. With the falling oil prices over the last years, Gasoline prices have fallen sharply in tandem and left the rather costly substitute ‐ biodiesel

Biodiesel Usage

US d i t d ti bi di l i t f A ti

  • US announced new import duties on biodiesel imports from Argentina

and Indonesia, which received improper government subsidies. The countervailing duties on soy‐based Argentina biodiesel could be as much as 64.17%, according to a statement from the U.S. Commerce

  • Department. Duties of up to 68.28% will be imposed on palm oil

biodiesel imports from Indonesia

US Imposed Tariffs Retroactively

  • n Biodiesel from

Argentina and Indonesia

biodiesel imports from Indonesia.

  • India, the world's major palm oil importer, to widen the import duty

gap between refined bleached and deodorized (RBD) palm olein and

Change on Import Duty of

gap between refined, bleached and deodorized (RBD) palm olein and crude palm oil (CPO).

g p y Palm Oil in India

  • The Cabinet also gave approval to the draft Oil Palm and Palm Oil Act

proposed by the Agriculture and Cooperatives Ministry, hoping the law will allow for the systematic development of the oil palm and palm oil industry.

Thailand Oil Palm and Palm Oil Act

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SLIDE 36

Agenda

  • Company Overview (LST)
  • Company Overview (UPOIC)

I d t O i

  • Industry Overview
  • Financial Overview (UPOIC)
  • Financial Overview (LST)
  • Business Overview (UFC)

( )

  • Q&A

36

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SLIDE 37

Performance Summary (Consolidated)

1H2017 Financial Summary

Reported 1H2017net profit decreased 93 62%YoY to

559 349 Sales revenue

  • 210 Million

decreased 93.62%YoY to THB 5 Million

149 37 Gross Profit

  • 112 Million Baht

Share price movement (Jan‐12 Sep 17 )

102 14 EBIT

  • 88 Million Baht

(Jan 12 Sep 17 ) ‐18.9%

80 5 Net Profit

  • 75 Million Baht

1H17 1H16

37

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SLIDE 38

2Q17 Performance Summary YoY Change 2Q17 vs 1Q17

Sales

THB 208.7 mn

YoY Change 2Q17 vs 1Q17

‐21.83% +48.69%

Gross Profit

THB 29 72 mn ‐64.46% +309.71%

Operating Profit

THB 29.72 mn 64.46% +309.71% THB 28.67 mn ‐33.23% +294.98%

Net Profit (after tax)

THB 23.01 mn ‐30.57% +228.37%

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SLIDE 39

FFB Crop 2012 – 1H2017

51% 53% 49% 49% 51% 65% 57% 60% 80% 100% 51% 53% 49% 35% 43% 49% 47% 51% 20% 40% 60% 0% Y2012 Y2013 Y2014 Y2015 Y2016 Own Estates Out‐grower

58% 59% 63% 80% 100% 61% 80% 100% 46% 42% 41% 37% 54% 58% 59% 63% 20% 40% 60% 44% 39% 56% 61% 20% 40% 60% 0% 20% 1Q16 2Q16 1Q17 2Q17 Own Estates Out grower 0% 20% 1H16 1H17 Own Estates Out grower

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Own Estates Out‐grower Own Estates Out‐grower

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SLIDE 40

Revenue by Segment

Million Baht

1,536 2,000 2,500 1,536 1,352 1,154 1,260 946 349 500 1,000 1,500 ‐ Y2012 Y2013 Y2014 Y2015 Y2016 1H17 CPO CPKO Others 8% 10% 12% 13% 14% 9% 6% 6% 6% 4% 4% 7% 80% 100% 85% 84% 81% 83% 82% 84% 20% 40% 60% 0% Y2012 Y2013 Y2014 Y2015 Y2016 1H17 CPO CPKO Others

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SLIDE 41

Profitability Analysis (Consolidated)

Return on Asset (ROA)

27.9% 14.7% 16.8% 6 3% ‐1.1% 6.3% 0.3% 20 2 20 3 20 20 20 6

Return on Equity (ROE)

Y2012 Y2013 Y2014 Y2015 Y2016 1H17 31.4% 20.0% 12.1% 4 7% ‐0.8% 4.7% 0.5% Y2012 Y2013 Y2014 Y2015 Y2016 1H17

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Y2012 Y2013 Y2014 Y2015 Y2016 1H17

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SLIDE 42

Financial Position Summary (As of 30 June 2017)

Total Asset (Million Baht) 1 501 1,560 1,582 1,547 1,718 495 938 919 976 921 893 398 268 383 273 307 541 1,174 1,501 , , 281 295 258 332 319 283 Y2012 Y2013 Y2014 Y2015 Y2016 1H17 Other Asset PP&E Current Asset Total Debt & D/E Ratio Interest Coverage Ratio (Times)

Million Baht

Times

232.0 232.0 623 0 13 0.36 0.38 0.49 0.35 0.57 0 20 0.40 0.60 400 600 800 39.0 9.0 24.0 12.9 Y2013 Y2014 Y2015 Y2016 1H17 131 399 431 397 397 623 0.13 ‐ 0.20 ‐ 200 Y2012 Y2013 Y2014 Y2015 Y2016 1H17

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Y2013 Y2014 Y2015 Y2016 1H17 Debt (Mil.Baht) D/E Ratio (times)

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SLIDE 43

2Q17 Income Statement

(Million baht) 2Q17 % to Sales 2Q16 % to Sales 1Q17 % to sales 2Q17/ 2Q16 Ch 2Q17/ 1Q17 Ch Consolidated Change Change Sales 208.72 100.0% 267.02 100.0% 140.37 100.0% ‐21.83% 48.69% Cost of sales (179.00) ‐85.8% (183.41) ‐68.7% (133.12) ‐94.8% ‐2.40% 34.47% Gross profit 29.72 14.2% 83.62 31.3% 7.25 5.2% ‐64.46% 309.71% SG&A expense (17.42) ‐8.3% (16.14) ‐6.0% (16.22) ‐11.6% 7.90% 7.39% Other income 5.12 2.5% 8.04 3.0% 1.87 1.3% ‐36.29% 174.33% Gain / (Loss) from change in fair value

  • f biological assets

11.21 5.4% (28.59) ‐10.7% (2.16) ‐1.5% 139.21% 618.94% Share of profit (loss) from investment in joint venture 0.05 0.0% (3.97) ‐1.5% (5.45) ‐3.9% 101.21% 100.88% EBIT 28.67 13.7% 42.95 16.1% (14.71) ‐10.5% ‐33.23% 294.98% FinanceCost (2.48) ‐1.2% (2.22) ‐0.8% (1.58) ‐1.1% 11.73% 56.87% FinanceCost (2.48) 1.2% (2.22) 0.8% (1.58) 1.1% 11.73% 56.87% EBT 26.20 12.6% 40.73 15.3% (16.29) ‐11.6% ‐35.68% 260.87% Tax (3.19) ‐1.5% (7.59) ‐2.8% (1.64) ‐1.2% ‐58.01% 94.27% Net income 23.01 11.0% 33.14 12.4% (17.93) ‐12.8% ‐30.57% 228.37% N t i (L tt ib t t Net income (Loss attribute to : Equity holder of the Company 11.29 5.4% 33.14 12.4% (17.93) ‐12.8% ‐65.93% 162.99% Non‐Controlling interests of the subsidiar (11.72) ‐5.6% 0.00 0.0% 0.00 0.0% Earning per share 0.07 0.10 (0.06)

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SLIDE 44

Statement of Financial Position as of 30 June 2017

(Million baht) 2Q17 % to total assets 2016 % to total assets Change Cash and cash equivalents 155 54 9 1% 96 04 6 2% 0 62 Consolidated Cash and cash equivalents 155.54 9.1% 96.04 6.2% 0.62 Trade and other receivables 23.50 1.4% 14.55 0.9% 61.48% Inventories 253.58 14.8% 98.35 6.4% 157.82% Other current assets 108.83 6.3% 97.82 6.3% 11.26% Total current assets 541.45 31.5% 306.77 19.8% 76.50% Fixed assets 893.03 52.0% 921.18 59.5% ‐3.06% Cost of forest land rights and cost of palm plant 223.60 13.0% 214.77 13.9% 4.11% Other non‐current assets 59.59 3.5% 104.66 6.8% ‐43.07% Total assets 1,717.66 100.0% 1,547.37 100.0% 11.00% B k d ft d h t t l 560 00 32 6% 340 00 22 0% 64 71% Bank overdrafts and short‐term loans 560.00 32.6% 340.00 22.0% 64.71% Trade and other payables 32.69 1.9% 40.01 2.6% ‐18.28% Current portion of long‐term loans ‐ 0.0% ‐ 0.0% Other current liabilities 10.20 0.6% 6.30 0.4% 62.02% Total current liabilities 602.89 35.1% 386.30 25.0% 56.07% Total current liabilities 602.89 35.1% 386.30 25.0% 56.07% Long‐Term Borrowings ‐ 0.0% ‐ 0.0% Other non‐current liabilities 19.92 1.2% 10.98 0.7% 81.39% Total liabilities 622.81 36.3% 397.28 25.7% 56.77% Paid‐up capital 324.05 18.9% 324.05 20.9% 0.00% Paid‐in surplus 321.55 18.7% 321.55 20.8% 0.00% Retained earnings 449.25 26.2% 504.50 32.6% ‐10.95% Non‐Controlling interests of the subsidiaries ‐ 0.0% ‐ 0.0% Total liabilities and shareholders' equity 1,717.66 100.0% 1,547.37 100.0% 11.00%

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SLIDE 45

Agenda

  • Company Overview (LST)
  • Company Overview (UPOIC)

I d t O i

  • Industry Overview
  • Financial Overview (UPOIC)
  • Financial Overview (LST)
  • Business Overview (UFC)

( )

  • Q&A

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SLIDE 46

1H2017 Financial Summary

LST 1H2017 Financial Summary

2,970 3,225 Sales revenue

+255 Million Baht

4,080 4,260 Sales revenue

+180 Million Baht

209 326 Gross Profit

+117 Million Baht

685 702 Gross Profit

+17 Million Baht

81 159 EBIT

+78 Million Baht

260 320 EBIT

+60 Million Baht

78 141 Net Profit

+63 Million Baht

189 253 Net Profit

+65 Million Baht

1H17 1H16 1H17 1H16

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SLIDE 47

2Q17 Performance Summary (Consolidated)

Sales

YoY Change 2Q17 vs 1Q17

Sales

THB 2,178.6 mn +3.66% +4.66%

Gross Profit

THB 407 5 mn +6.08% +38.49%

Operating Profit

THB 407.5 mn +6.08% +38.49% THB 229.9 mn +54.13% +171.77%

Net Profit to Equity Holder

THB 180.59 mn

+77.41% +158.24%

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SLIDE 48

Profitability Analysis (Consolidated)

Return on Asset (ROA)

6.8% 6.0% 8.5% 5.6% 6.0% 4.1% Y2012 Y2013 Y2014 Y2015 Y2016 1H17

Return on Equity (ROE)

Y2012 Y2013 Y2014 Y2015 Y2016 1H17 14.1% 11.1% 14.8% 9.8% 10.6% 7 0% 7.0%

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Y2012 Y2013 Y2014 Y2015 Y2016 1H17

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SLIDE 49

Financial Position Summary (As of 30 June 2017)

Total Asset (Million Baht) 5 947 6,473 2,785 2,396 2,448 2,803 2,880 3,481 5,221 5,163 5,124 5,871 5,947 , 571 586 591 643 654 594 1,865 2,181 2,085 2,425 2,413 2,398 Y2012 Y2013 Y2014 Y2015 Y2016 1H17 Total Debt & D/E Ratio Interest Coverage Ratio (Times)

Million Baht Times 0 90

22.2 Other Asset PP&E Current Asset

0.90 0.81 0.66 0.82 0.70 0.78 0 40 0.60 0.80 1.00 1 500 2,500 3,500 4,500

9.3 10.9 13.9 16.2 14.5 17.0 22.2

2,468 2,311 2,030 2,648 2,455 2,836 ‐ 0.20 0.40 ‐500 500 1,500 Y2012 Y2013 Y2014 Y2015 Y2016 1H17 D bt (Mil B ht) D/E R ti (ti )

Y2011 Y2012 Y2013 Y2014 Y2015 Y2016 1H17

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Debt (Mil.Baht) D/E Ratio (times)

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SLIDE 50

2Q17 Income Statement

(Million baht) 2Q17 % to Sales 2Q16 % to Sales 1Q17 % to sales 2Q17/ 2Q16 Change 2Q17/ 1Q17 Change Consolidated g g Sales 2,178.61 100.0% 2,102.92 100.0% 2,081.62 100.0% 3.6% 4.7% Cost of sales (1,771.11) ‐81.3% (1,718.75) ‐81.7% (1,787.38) ‐85.9% 3.0% ‐0.9% Gross profit 407.51 18.7% 384.16 18.3% 294.25 14.1% 6.1% 38.5% SG&A (216 76) 9 9% (217 59) 10 3% (213 74) 10 3% 0 4% 1 4% SG&A expense (216.76) ‐9.9% (217.59) ‐10.3% (213.74) ‐10.3% ‐0.4% 1.4% Other income* 27.85 1.3% 19.68 0.9% 16.86 0.8% 41.5% 65.2% Gain / (Loss) from change in fair value of biological assets 11.21 0.5% (28.59) ‐1.4% (2.16) ‐0.1% 139.2% 618.9% Share of profit (loss) from investment in Share of profit (loss) from investment in joint venture 0.05 0.0% (3.97) ‐0.2% (5.45) ‐0.3% 101.2% 100.9% EBIT 229.86 10.6% 153.69 7.3% 89.76 4.3% 49.6% 156.1% FinanceCost (10.66) ‐0.5% (11.47) ‐0.5% (9.11) ‐0.4% ‐7.1% 17.1% EBT 219.20 10.1% 142.22 6.8% 80.66 3.9% 54.1% 171.8% Tax (30.89) ‐1.4% (27.73) ‐1.3% (15.67) ‐0.8% 11.4% 97.1% Net income 188.30 8.6% 114.49 5.4% 64.98 3.1% 64.5% 189.8% Net income (Loss attribute to : Net income (Loss attribute to : Equity holder of the Company 180.59 8.3% 103.55 4.9% 69.93 3.4% 74.4% 158.2% Non‐Controlling interests of the subsidiaries 7.71 0.4% 10.95 0.5% (4.95) ‐0.2% ‐29.6% 255.8% Earning per share 0.22 0.13 0.09

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SLIDE 51

1H2017 Income Statement

(Million baht) 1H17 % to Sales 1H16 % to Sales 1H17/ 1H16 Change Consolidated Sales 4,260.24 100.0% 4,080.47 100.0% 4.4% Cost of sales (3,558.48) ‐83.5% (3,395.91) ‐83.2% 4.8% Gross profit 701.76 16.5% 684.57 16.8% 2.5% SG&A expense (430.50) ‐10.1% (437.77) ‐10.7% ‐1.7% Other income* 44.72 1.0% 39.26 1.0% 13.9% Gain / (Loss) from change in fair value of biological assets 9.05 0.2% (19.17) ‐0.5% 147.2% g ( ) Share of loss from investment in joint venture (5.40) ‐0.1% (6.93) ‐0.2% ‐22.1% EBIT 319.62 7.5% 259.96 6.4% 23.0% FinanceCost (19.77) ‐0.5% (22.72) ‐0.6% ‐13.0% EBT 299.85 7.0% 237.24 5.8% 26.4% Tax (46.57) ‐1.1% (48.62) ‐1.2% ‐4.2% Net income 253.29 5.9% 188.61 4.6% 34.3% N t i (L tt ib t t Net income (Loss attribute to : Equity holder of the Company 250.53 5.9% 164.46 4.0% 52.3% Non‐Controlling interests of the subsidiaries 2.76 0.1% 24.16 0.6% ‐88.6% Earning per share 0 31 0 20 Earning per share 0.31 0.20

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SLIDE 52

Statement of Financial Position as of 30 June 2017

(Million baht) 2Q17 % to total assets 2016 % to total assets Change Cash and cash equivalents 438.19 6.8% 420.39 7.0% 4.2% Consolidated q Trade and other receivables 938.98 14.5% 911.80 15.3% 3.0% Inventories 1,956.72 30.2% 1,425.89 23.9% 37.2% Other current assets 147.15 2.3% 147.90 2.5% ‐0.5% Total current assets 3,481.05 53.8% 2,905.98 48.6% 19.8% Fixed assets 2,398.27 37.0% 2,413.75 40.4% ‐0.6% Goodwill and other intangible assets 207.91 3.2% 205.07 3.4% 1.4% Other non‐current assets 386.17 6.0% 448.94 7.5% ‐14.0% Total assets 6,473.39 100.0% 5,973.74 100.0% 8.4% Bank overdrafts and short term loans 1 975 00 30 5% 1 555 00 26 0% 27 0% Bank overdrafts and short‐term loans 1,975.00 30.5% 1,555.00 26.0% 27.0% Trade and other payables 515.31 8.0% 503.95 8.4% 2.3% Current portion of long‐term loans 103.57 1.6% 103.57 1.7% 0.0% Other current liabilities 93.24 1.4% 96.65 1.6% ‐3.5% Total current liabilities 2,687.12 41.5% 2,259.18 37.8% 18.9% Total current liabilities 2,687.12 41.5% 2,259.18 37.8% 18.9% Long‐Term Borrowings 82.63 1.3% 134.35 2.2% ‐38.5% Other non‐current liabilities 66.32 1.0% 61.94 1.0% 7.1% Total liabilities 2,836.07 43.8% 2,455.46 41.1% 15.5% Paid‐up capital 820.00 12.7% 820.00 13.7% 0.0% Paid‐in surplus 247.24 3.8% 247.24 4.1% 0.0% Retained earnings 2,234.08 34.5% 2,073.62 34.7% 7.7% Non‐Controlling interests of the subsidiaries 336.00 5.2% 351.44 5.9% ‐4.4% Total liabilities and shareholders' equity 6,473.39 100.0% 5,947.76 99.6% 8.8%

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SLIDE 53

Agenda

  • Company Overview (LST)
  • Company Overview (UPOIC)

I d t O i

  • Industry Overview
  • Financial Overview (UPOIC)
  • Financial Overview (LST)
  • Business Overview (UFC)

( )

  • Q&A

53

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SLIDE 54

Worldwide Customer Base

UK Germany Netherlands China Japan Netherlands

America Asia Europe

Japan South Korea Taiwan Hong Kong Oman UAE Kuwait Malaysia Si Singapore Brunei Philippines USA Canada

Australia Africa

Australia New Zealand 54

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SLIDE 55

Financial Summary (2014 ‐2016)

17.0% 20.0% 4,000 Sales Revenue

Million Baht

2 393 7.6% 11.2% 10.0% 15.0% 2,000 3,000 , 1,839 2,045 2,393 0.0% 5.0% 1,000 Y2014 Y2015 Y2016 Sales Sales Growth Net Profit Gross Profit

Million Baht Million Baht

568 647 22.4% 27.8% 27.0% 10 0% 20.0% 30.0% 400 600 800 230 5.0% 7.4% 9.5% 5.0% 10.0% 100 200 300 413 568 647 0.0% 10.0% 200 Y2014 Y2015 Y2016 Gross profit GP Margin 91 151 230 0.0% 100 Y2014 Y2015 Y2016 Net profit Net profit margin

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Gross profit GP Margin Net profit Net profit margin

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SLIDE 56

Sales Performance (Consolidated)

+3.59% YOY

+33.38% 2Q17 vs 1Q17

‐2.31% YOY Million Baht Million Baht

1,200 1,400 800 1,000 1,000 1,200 600 800 1,201 1,174 600 800 647 503 671 200 400 200 400 2Q16 1Q17 2Q17 1H16 1H17 56

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SLIDE 57

Gross Profit (Consolidated)

+10.60% YOY +53.81% 2Q17 vs 1Q17 +2.76% YOY Million Baht Million Baht 35 0% 40.0% 350 400 40.0% 350 400 28.8% 26.6% 30.7% 25.0% 30.0% 35.0% 250 300 350 27.5% 29.0% 30.0% 250 300 350 186 206 10 0% 15.0% 20.0% 100 150 200 331 340 10 0% 20.0% 100 150 200 186 134 206 0.0% 5.0% 10.0% 50 100 2Q16 1Q17 2Q17 0.0% 10.0% 50 100 1H16 1H17 Q Q Q Gross profit GP Margin 1H16 1H17 Gross profit GP Margin

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SLIDE 58

Net Profit (Consolidated)

+31.00% YOY +117.51% 2Q17 vs 1Q17 +18.21% YOY Million Baht Million Baht

14 5% 16.0% 20.0% 140 160 16 0% 20.0% 140 160 11.4% 8 9% 14.5% 12.0% 80 100 120 10.0% 12.1% 12.0% 16.0% 80 100 120 74 97 8.9% 8.0% 40 60 80 120 142 8.0% 40 60 80 74 45 0.0% 4.0% 20 40 0.0% 4.0% 20 40 2Q16 1Q17 2Q17 Net profit Net profit margin 1H16 1H17 Net profit Net profit margin 58

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SLIDE 59

Financial Position Summary (As of 30 June 2017)

Total Asset (Million Baht) 1,789 1,661 1,778 732 1,076 889 993 1,443 , 90 70 94 71 620 643 679 715 Y2014 Y2015 Y2016 1H17 Other Asset PP&E Current Asset Total Debt & D/E Ratio ROA & ROE

Million Baht Times

Other Asset PP&E Current Asset

35 4% 40 0%

1 111 1,306 1 012 987 3.35 2.70 1.56 1.24 1.50 2.50 3.50 500 1,000 1,500

6 3% 8.5% 13.8% 5 5% 27.5% 31.3% 35.4% 12.4% 20.0% 30.0% 40.0%

1,111 1,012 987 ‐0.50 0.50 ‐ 500 Y2014 Y2015 Y2016 1H17 Debt (Mil Baht) D/E Ratio (times)

6.3% 5.5% 0.0% 10.0% Y2014 Y2015 Y2016 1H17 ROA ROE

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Debt (Mil.Baht) D/E Ratio (times)

ROA ROE

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SLIDE 60

Growth Drivers

  • New Products
  • Add value to our portfolio with innovation to delight
  • ur customers eg. Almond Milk Drinks .
  • More new products in progress.
  • New Markets
  • New Markets
  • Strengthen our leadership in key markets and expand

to new potential countries eg. Middle East and Russia

  • New Channels
  • New Channels
  • Exploring new business channel eg. Online retailers.

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SLIDE 61

Q&A Thank You

Lam Soon (Thailand) Public Company Limited 64 Soi Bangna ‐ Trad 25, Bangna, Bangkok 10260

  • Tel. +66 2361 8959/87
  • Fax. (Management Dept.) +66 2361 8988/89
  • Fax. (Sales Dept.) +66 2361 8994/5

Email: secretary@lamsoon.co.th For further information & enquiries, please contact us at: Anchalee Suebchantasiri Piyathida Sukchan Managing Director Executive Director Tel: +66‐(0)2‐361 8959/87 Tel: +66‐(0)2‐361 8959/87 Email: anchales@lamsoon.co.th Email: piyatida@lamsoon.co.th

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