THAI WAH PUBLIC COMPANY LIMITED (TWPC) INVESTOR STOR PRESENT - - PowerPoint PPT Presentation

INVESTOR STOR PRESENT SENTAT ATION N 2016 2016

“TO BE A REGIONAL LEADER IN STARCH AND STARCH-RELATED FOOD PRODUCTS”

THAI WAH PUBLIC COMPANY LIMITED (TWPC)

INVESTOR STOR PRESENT SENTAT ATION N 2016 2016

“TO BE A REGIONAL LEADER IN STARCH AND STARCH-RELATED FOOD PRODUCTS”

THAI WAH PUBLIC COMPANY LIMITED (TWPC)

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DISCLAIMERS

This information is given in summary form and does not purport to be complete. Information is this presentation, including forecast financial information, should not be considered as advice or a recommendation to investors or potential investors in relation to holding, purchasing or selling securities or other financial products or instruments and does not take into account your particular investment objectives, financial situation or needs. Before acting on any information you should consider the appropriateness of the information having regard to these matters, any relevant offer document and in particular, you should seek independent financial advice. All securities and financial product or instrument transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments and, in international transaction, currency risk. This presentation may contain forward looking statements including statements regarding our intent, belief or current expectations with respect to TWPC’s businesses and operations, market conditions, results of operation and financial condition, capital adequacy, specific provisions and risk management practices. Readers are cautioned not to place undue reliance on these forward looking statements, TWPC does not undertake any obligation to publicly release the result of any revisions to these forward looking statements to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events. While due care has been used in the preparation of forecast information, actual results may vary in a materially positive or negative manner. Forecasts and hypothetical examples are subject to uncertainty and contingencies outside TWPC’s control. Past performance is not a reliable of future performance. This Presentation is being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly to any other person or published, in whole or in part, for any purpose. No part of this presentation may be reproduced or taken or transmitted. The distribution of this presentation in other jurisdictions may be restricted by law, and persons into whose possession this presentation comes should inform themselves about, and such

• restrictions. By accepting this presentation you agree to be bound by the foregoing restrictions.

“ DISCLAIMERS : THIS REPORT HAS BEEN PREPARED BY THAI WAH PUBLIC COMPANY LIMITED (TWPC) PRELIMINARILY AS A PROPOSAL FOR INFORMATION PURPOSES ONLY ”

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AGENDA

Company Factsheet Business Overview Financial Performance Q&A Business Highlights

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BUSINESS HIGHLIGHTS IN 2016 2016

• Exceptional Strong

Revenue & Net Profit +54% Net Profit YoY

• Operated Thai Wah

International Trade (Shanghai)

• Expand Capacity for

Tapioca Starch, Glucose & Rice Noodle

• Prepare formation of

TWVN, TWCBD, TWBP

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GP Margin

2016 vs. 2015 25.4% vs. 21.4%

Sales growth

2016 +12% YoY Q4 +28% YoY

5

669 997 1,568 6,163 435 716 1,184 5,525

NP (after MI) EBITDA Gross profit Sales

2016

2015 2016 215 294 490 1,784 81 199 329 1,395

NP (after MI) EBITDA Gross profit Sales

Q4' 2016

Q4'15 Q4'16

FINANCIAL HIGHLIGHTS IN 2016 2016

NP (after MI)

2016 +54% YoY Q4 +165% YoY

EBITDA

2016 +39% YoY Q4 +48% YoY

Company Factsheet

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SYMBOL SECTOR / INDUSTRY TWPC Agribusiness / Agro & Food Industry NAME Thai Wah Public Company Limited MARKET Stock Exchange of Thailand (SET) COMMON STOCK LISTED DATE 880,420,930 shares (Par THB 1.00) 5th October 2015 PAID-UP CAPITAL THB 880.42 million DIVIDEND POLICY Increase in absolute dividend payout Institution - Thai 25.2% Retail -Thai 29.9% Institution - Foreigner 32.3% Retail - Foreigner 12.7%

Shareholder structure**

Source:

• The Company

** SET as of 30 December 2016 Free float 55%** Foreign limit 49%** Market Cap : around 8,232 MB**

COMPANY FACTSHEET

Business Overview

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TWS to go under rehabilitation process

• Expansion of the starch

business to drive export volume and enter into Vietnam market

• Market leadership of

vermicelli in Double Dragon, Double Kilin brands

• Automated vermicelli

production line Founding of Thai Wah in Rangoon, subsequently moved to Bangkok

• Leader in Thailand in Tungsten and Tin

Ore Mining

• 1952, started to produce and export

tapioca starch in Chonburi Province

• 1953, started to produce mung bean

vermicelli in Bangkok “Thai Wah No.1” first tapioca business and export out, leader and pioneer in Thailand Expansion of starch mill business in Thailand Move to Banglane District and create Thailand’s single largest vermicelli factory 1989 TWFP listed

• n the SET

1985 TWS listed

• n the SET

2013 TWS resumed trading on the SET Shareholders’ meeting of the two company approved the business combination between TWS and TWFP, by amalgamation process 1947 1950s – 1960s 1970s – 1980s 1985 2017 1963 1963 1990s – 2000s 2001-2007

HISTORICAL OF THAI WAH GROUP

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2015

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“Double Dragon” “Double Kilin” “Phoenix” “New Grade” “Alpha Brand” “Rose Brand” “Rose Brand” Starch and Related Business Food Products Business Native Starch Modified Starch Sweetener Vermicelli Rice Noodle

• Dry & fresh mung

bean vermicelli

• Mung bean starch noodle

(Shanghai noodle)

• Salim starch
• Native tapioca starch

for:-

• Alpha starch
• Modified tapioca starch

for :- Textile Industry Adhesive Industry Paper Industry Food Industry Food Industry Paper Industry MSG

• Sweetener for:-

Dairy Confectionery Coffee White

• Dry & fresh rice noodles
• Sago/tapioca pearl
• Coarse Flour

Production Base : 4 factories in Thailand and 2 factories in Vietnam Customer Base : ~75% Export and ~25% Domestic (TH only) Production Base : 1 factory in Thailand Customer Base : ~92% Domestic and ~8% Export Capacity : 390,000 tons for Tapioca starch and 33,000 tons for Glucose Capacity : 22,000 tons for Vermicelli and 4,000 tons for Noodles

THAI WAH BUSINESS OVERVIEW

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Starch Pearl Modified Starch Industrial BIO Application Animal Feed Paper Carton Fabric Sweetener Pharmaceutica l Carton Cosmeti c Beverage Sauces Glue & Adhesive Instant Meal Syrup & Dessert MSG Metal Industry Biodegradable Products Thai Dessert Cassava Root

STARCH APPLICATION

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OUR FOOD PRODUCT

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DELIVER QUALITY, TASTE, AND CONSISTANCY

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CASSAROLE SHABU DEEP FRIED STIR-FRIED QUICK THAW SHANGHAI NOODLE TAPIOCA PEARL SALAD PAD THAI

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TWPC aims to drive systematic margin improvement; higher ROIC rate for new investments to enable long term ROE growth

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Improve Sales and Marketing and distribution efforts Pioneer new verticals

• Improve national network for sales and marketing distribution
• Launch of food products to establish market leadership in

Indochina region (Vietnam, Myanmar, Cambodia, Laos)

• Establish new contract farming small holder models in emerging

markets to Cambodia, Myanmar with abundant root supply

• Develop new customer-centric food applications in modified

starch and other R&D efforts Drive volume growth through manufacturing expertise

• Capitalize on growth in Asia middle class food consumption

trends to increase production volume and capacity

• Increase in volume production for starch, glucose and rice

noodle segments across ASEAN region

• Continue to seek improvements in technology and

manufacturing efficiency to improve ROIC

Regional Leader in Starch and Starch Related Food Products

STRATEGIC IMPERATIVE : BUILD, EXPAND, AND GROWTH

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Established new subsidiary

• Thai Wah Vietnam Company Limited
• February 7, 2017
• Manufacturing and distributing of

food products

• VND 22,462 million (Baht 35 million)
• 100% Holding

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Myanmar Opportunities Pioneer new small holder farm model (2X Yield in 2015) Tapioca plantation & Chips Expansion into consumer foods, noodles, sauces, sweetener to tap

• n growing middle-class

Cambodia Opportunities Tapioca plantation and productivity improvement Investments in Tapioca given strong availability of roots Strong border links with Thailand and Vietnam Laos Opportunities Tapioca plantation and productivity improvement Tapioca chips, starch, export Vietnam Opportunities Enhancement of sweetener business Pho, Bun, Noodle, Rice Flour business Will be market leader in 2017, 3X Growth in 2015 for Vermicelli and Noodles

DEVELOP A FOOTPRINT ACROSS ASEAN

Established new subsidiary

• TWPC Investment (Cambodia)

Company Limited

• January 24, 2017
• Manufacturing and distributing of

starch products

• KHR 4,000 million (Baht 35 million)
• 100% Holding

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Nationwide Distribution Coverage

 Dry Vermicelli 63 provinces 27 provinces cover 90%  Fresh Vermicelli 52 provinces 21 provinces cover 90%  Dry Rice Noodle 42 provinces, 15 provinces cover 90%  Fresh Rice Noodle 46 provinces, 21 provinces cover 90%

FOOD DISTRIBUTION AND GO-TO MARKET STRATEGY

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Chiang Mai Phitsanulok Udon Thani Roi Et Chonburi Bangkok Banglan Surat Thani Korat

Key long term driver Leveraging a Technology - Enabled platform to build through Thailand and ASEAN

GPS-handheld

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FOOD EXPORT OPPORTUNITY

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Mainly Food Export to EU, USA, and CLMV Expansion more “Volume” especially in CLMV / Exploring more on “New Products” especially in USA and EU

8%

Contributions & Double-digit growth for Y2016

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• Native tapioca starch which

is extracted from the cassava root has unique properties differentiated from other starch crops (potato and pea) and mainly still in ASEAN

• Demand outlook for native

starch still strong, closely linked to food consumption demand for basic food application (coating, baking)

Modified Starch/Glucose Higher Value Added Products Native Tapioca Starch

• Modified starch applications

are often used for more advanced food/paper/textile applications to improve texture, acid and freezing

• tolerance. Unique feature on

thickening, stabilizing for sauce and texturizer

• Glucose demand outlook is

strong in Indochina, given middle class consumption trends and focus on dairy and beverage

• Potential enter in new viable

categories such as waxy starch,

• rganic starch, hydrophobic starch

which are higher value add products with differentiated properties on flavor, texture, fat replacement & water solubility

• By products of starch such as

tapioca pulp can be used for commercial purposes into fertilizer and animal feed including renewable energy

• Developing more customer centric

solutions and applications, e.g. special sauces and texturizers in Japan and China

Move along the value chain of applications

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STARCH TECHNOLOGY AND FUTURE OPPORTUNITIES

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• Chief Executive Officer
• BSC in in Economics with

Honors, Finance and Management, Wharton School, University of Pennsylvania, USA

• Previously: Bain & Co, Banyan

Tree Holdings Limited

THAI WAH TEAM

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Ho Ren Hua

• Managing Director, Starch

Business

• MBA, University of Central

Oklahoma, USA

• Board of Executive Committee,

The Thai Tapioca Trade Association (TTTA)

• >25 years in TW Starch and

Vietnam Business

Umnad Sukprasongphol

• Managing Director, Food

Business

• MBA, National Institute of

Development Administration

• >25 years in TW Starch

Prateep Lertvatanakijkul

• Group Finance Director
• MBA, the American Graduate

School of International Management (Thunderbird), Arizona, USA

• Previously: Akzo Nobel Paints

(Thailand) Limited, Kimberly- Clark (Thailand) Limited

Orn-anong Witchucharn

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STRONG NG SUSTAIN TAINABL ABLE GROWTH TH

TW2020 2020 GROWTH STRATEGY

“TO BE A REGION ONAL AL LEADER DER IN STARCH RCH AND D STARCH RCH- RELATED FOOD PRODUCTS”

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CSR FOR SUSTAINABILITY

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Bioeconomy development project  10-years development plan under the government and Pracharat  Encourage modern farming management  High Value-added bioproducts (Biorefinery – Starch “Fermentation” Platform)  Increase the value of cassava to more than 100 billion baht / year

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CSR FOR SUSTAINABILITY

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To improve deteriorated soil  Encourage the farmers to use natural fertilizers  In collaboration with government authorities and local community leaders  Reduce manufacturing costs and help increase the crop volume for the farmers The practice mushroom farming  Encourages students to use soil remnants and cassava peels left from manufacturing procedure  Generates income to benefit local communities  Received a golden award from the “Caltex Fuel your school” project

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SMART E-MONEY TO FARMERS

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Product Features  Move from Cash settlement to e-payment  Easy withdraw from ATM of any bank  Link to Farmer database

Financial Performance

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Native, 53% HVA*, 25% Food, 22% Export 57% Local 43% China & Asia 87% Europe 5% US & Canada 5% Middle East & Others 3%

*HVA products – Glucose, Coarse flour, Pearl, Alpha starch

SALES BREAKDOWN

Thai Wah Group Sales Breakdown

Sales Breakdown by Base Operation

Thailand Sales Breakdown

Export Breakdown

Source : The Company

Thailand 79% Vietnam 20% China 1%

Note : Thai Wah International Trade (Shanghai) started operation in Q3’16

Sales Breakdown by Business Thailand Sales Breakdown by Geographic

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• 500

1,000 1,500 2,000 2,500 Cash & Financial investment, 1,757 Financial Debt, 171

Unit : MB

Non-CA 3,606 CA, 2,797 0% 20% 40% 60% 80% 100% Equity, 5,335 Non-CL, 308 CL 1,541

BV = 6.06 BAHT/share Unit : MB

510 485 599 671 200 400 600 800 2013 2014 2015 2016

2015 – 0.27 BAHT/share 2016 – 0.30 BAHT/share, which will propose to the Shareholders’ meeting

226 232 238 264

0% 5% 10% 15% 20% 25% 30% 35% 40%

200 220 240 260 280 2013 2014 2015 2016

STRONG CASH POSITION

Strong Cash with Debt-free position Balance sheet Composition Strong Operating Cash flow Increase in absolute dividend payout

Unit : MB Unit : MB D/E (Debt - Interest bearing ) = 0.03 Source : The Company

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DELIVERED STRONG PERFORMANCE IN 2016 2016

435 669 81 215 7.9% 10.9% 5.8% 12.1%

• 50.0%
• 40.0%
• 30.0%
• 20.0%
• 10.0%

100 200 300 400 500 600 700 800 900 1,000

2015 2016 4Q15 4Q16 NP Margin

Revenue from Sales EBITDA Gross Profit Net Profit (After MI)

Note: 2015 FS was consolidated financial information between TWA and TWFP

5,525 6,163 1,519 1,784

1,000 2,000 3,000 4,000 5,000 6,000 7,000

2015 2016 4Q16 4Q16 716 997 199 294

200 400 600 800 1,000 1,200

2015 2016 4Q15 4Q16 1,184 1,568 288 490 21.4% 25.4% 20.7% 27.5%

• 50.0%
• 40.0%
• 30.0%
• 20.0%
• 10.0%

500 1,000 1,500 2,000

2015 2016 4Q15 4Q16 GP Margin

Source : The Company 2015 FS was the consolidated by the Company

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CONSISTENCY SHAREHOLDER RETURNS

ROE ROCE Net Profit & Earning Per Share

15 12 13 15

7 9 11 13 15 17 19

2013 2014 2015 2016 ROE 446 434 435 669 0.51 0.49 0.49 0.76

• 0.4
• 0.2

0.2 0.4 0.6 0.8 100 200 300 400 500 600 700 800 900 1000

2013 2014 2015 2016 EPS

*Profitability Ratio is excluded Cash

ROA

12 10 10 12

5 7 9 11 13 15 17

2013 2014 2015 2016 ROA 12 11 12 15

4 6 8 10 12 14 16 18

2013 2014 2015 2016 ROCE

Note: 2013-2015 FS was consolidated financial information between TWA and TWFP

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TWPC’S STARCH EXPORT TO CHINA

2,681 3,081 3,343 3,959 3,828 4,223 646 789 1,387 1,756 1,525 1,710 8.1% 7.9% 5.4% 6.9% 7.0% 8.6%

• 300.0%
• 250.0%
• 200.0%
• 150.0%
• 100.0%
• 50.0%

0.0% 50.0%

1,000 2,000 3,000 4,000 5,000 6,000 2011 2012 2013 2014 2015 2016 Total starch Export* Total starch Export to China* TWPC's starch export to China**

‘000 Ton

*Total Starch is including Native Starch and Modified Starch **% Market Share of Native Starch export to China (Not including Modified Starch) Source : The Company and The Thai Tapioca Trade Association

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GOING FORWARD

• To be A leading Small Cap in ASEAN, recognized for consistency and strong financial discipline
• Core long term strategy to pursue High-single digit Growth and Sustainability
• Consistently improve YoY on company operating margins, increasing mix of HVA products

and improving returns on capital to shareholders

• Aggressive regional growth expansion, over the next 3 years with 1-2B Baht investment
• Embracing technology of our value chain to a long term competitive advantage

Q&A

Contact: ir@thaiwah.com

APPENDIX

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STARCH PRICE (DOMESTIC VS EXPORT)

5,000 10,000 15,000

Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17

Starch Price Starch Export Price THB/Ton

Source : The Thai Tapioca Trade Association Note: Used FX Rate as a period-average (BOT)

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ROOT PRICE AND STARCH EXPORT PRICE

0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50 4.00 4.50 5.00 100 200 300 400 500

Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16

Starch Export Price Root Price USD/Ton THB/Kg.

Source : The Thai Tapioca Trade Association

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STOCK PRICE

6 7 8 9 10 11

7/4/59 7/8/59 7/14/59 7/22/59 7/28/59 8/3/59 8/9/59 8/16/59 8/22/59 8/26/59 9/1/59 9/7/59 9/13/59 9/19/59 9/23/59 9/29/59 10/5/59 10/11/59 10/17/59 10/21/59 10/28/59 11/3/59 11/9/59 11/15/59 11/21/59 11/25/59 12/1/59 12/8/59 12/15/59 12/21/59 12/27/59 1/4/60 1/10/60 1/16/60 1/20/60 1/26/60 2/1/60 2/7/60 2/14/60 2/20/60

Stock Price THB

Source : SET +38% during Y2016