TPBI Public Company Limited Opportunity Day Presentation March 4, - - PowerPoint PPT Presentation

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Strictly Private & Confidential

TPBI Public Company Limited

Opportunity Day Presentation

March 4, 2020

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Disclaimer

Page1

The information contained in this presentation is for information purposes only and does not constitute an offer or invitation to sell or the solicitation of an offer or invitation to purchase or subscribe for share in TPBI Public Company Limited (“TPBI”) in any jurisdiction nor should it or any part of it form the basis

• f, or be relied upon in any connection with, any contract or commitment whatsoever.

In addition, this presentation contains projections and forward-looking statements that reflect the Company’s current views with respect to future events and financial performance. These views are based on a number of estimates and current assumptions which are subject to business, economic and competitive uncertainties and contingencies as well as various risks and these may change over time and in many cases are outside the control of the company and its directors. You are cautioned not to place undue reliance on these forward looking statements, which are based on the current view of the management of the Company on future events. No assurance can be given that future events will occur, that projections will be achieved, or that the Company's assumptions are correct. The Company does not assume any responsibility to amend, modify or revise any forward-looking statements, on the basis

• f any subsequent developments, information or events, or otherwise. These statements can be

recognized by the use of words such as “expects,” “plans,” “will,” “estimates,” “projects,” or words of similar meaning. Such forward-looking statements are not guarantees of future performance and actual results may differ from those forecast and projected or in the forward-looking statements as a result of various factors and assumptions.

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Agenda

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Section 1 About TPBI Group Section 2 Business Overview Section 3 Financial Highlights Section 4 Future Plan

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TPBI Group Overview

Number of Shares Outstanding (mm) 416.88 Registered Shares (THB mm) 416.88 Paid-up Capital (THB mm) 416.88 Par Value per Share (THB) 1 Share Movement ( Sep 19 – Dec 19) High (THB) 5.00 Low (THB) 4.00 Average (THB) 4.24 Average Market Capitalization (THB mm) 2,044.96 Average Daily Trading Value (THB mm) 0.13 Dividend Payout Policy (%) At least 50% of net profit

TPBI is Thailand’s No. 1 total solution provider

• f packaging, providing complete services

✓ product design and formula development ✓ manufacturing and procurement ✓ raw material and product testing

TPBI’s VISION is “To be a leading packaging manufacturer who achieves sustainable growth together with all

stakeholders”

Company Profile

• TPBI Public Company Limited (“TPBI”) was

established by Borrisuttanakul family as a plastic-bag trader/producer

• More than 30-year experience led the company

become the leader of plastic-bag producer in Thailand

• The company was listed on the Stock Exchange of

Thailand in the beginning of 2Q16

Share Summary

Source: Company Data,Bloomberg

*Shareholder holding as of the latest book closing date

• TPBI Public Company Limited (“TPBI”) was

established by Borrisuttanakul family as a plastic-bag trader/producer

• More than 30-year experience led the company

become the leader of plastic-bag producer in Thailand

• The company was listed on the Stock Exchange of

Thailand in the beginning of 2Q16

Borrisuttanakul family, 71.02% BBLAM, 11.84% Others, 17.14%

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TPBI Group Products

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Source: CompanyData

Revenue Breakdown in 2019 Revenue Breakdown in 2018 Sales Breakdown by Product

▪ TPBI Group’s total sales for 2019 is THB 5,298.86 mm, having sales proportion by products as follows:

Garbage bags 23% Fruit&vegetable bags 4% Vest carriers/t-shirt bags 21% Soft Loop 8% Multi-layer blown film 10% Flexible Packaging 15% TPBI UK - Paper 1% TPBI UK - Trading 4% Others 14% Garbage bags 28% Fruit&vegetable bags 4% Vest carriers/t- shirt bags 10% Soft Loop 3% Flat cut bags 4% Multi-layer blown film 10% Flexible Packaging 14% Paper 5% Trading 10% Others 12%

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Market Diversification

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“TPBI Group distributes their different types of products to various regions to diversify the risk of relying on a few market”

Note: :*Other countries include South Korea, Singapore, Nigeria, Laos, Cambodia, etc. Source: Company Data

Market Diversification

▪ During 2019, approximately 65.37% of total sales are from exports to international markets while 34.63% are from domestic sales.

In 2019 In 2018

Australia 19% Japan 8% UK 9% USA 10% Myanmar 3% New Zealand 6% Other countries 5% Thailand 40% Australia 13% Japan 6% UK 13% USA 22% Myanmar 3% New Zealand 2% Other countries 6% Thailand 35%

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Agenda

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Section 1 About TPBI Group Section 2 Business Overview Section 3 Financial Highlights Section 4 Future Plan

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TPBI’s Business Divisions

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Consumables Flexibles Paper Product Mix:

• Vest carrier bags/ T-shirt bags/

Bio compostable bags/ Fruit & Vegetable bags/ Garbage bags/ Loop- handle/ Die cut bags/ Fashion bags/ EMAP film bags

• New Products: Roll Star/ New

design garbage bags/ New design bags on roll for fruit and vegetable/ Mail Order bags/ Liner bags/ LLDPE food bags Production Capacity:

• ~ 62,000 tons per year

Key Markets:

• Australia, UK, USA, New

Zealand, Japan and etc. Product Mix:

• Lamination film/ Barrier film/

Stretch hood/ Shrink film

• Packaging for frozen food,

ready-to-eat food and others

• Digital Printing

Production Capacity:

• Multi Layer Film: ~ 11,500 tons

per year

• Flexible Packaging: ~ 150 million

meters per year Key Markets:

• Thailand, Vietnam, Singapore ,

Australia, and etc. Product Mix:

• Flat & Satchel bag/ Block

Bottom/ SOS / Tape Handle / die cut SOS bags Production Capacity:

• ~ 510 million bags per year

Key Markets:

• UK

Global Trading Product Mix:

• Reusable bags/ Piping bags/ All

products from Consumable, Flexible, and Paper divisions. Key Markets:

• UK, Australia, and USA.

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Historical Production Capacity and Utilization Rate

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Consumables Multilayer Blown Film

• Consumables capacity is currently around

60,000 tons per year

• Utilization rate was 73.38%
• Multilayer blown film capacity is currently

around 11,500 tons per year

• Utilization rate was 84.06%

Source: Company Data

83.57% 86.81% 86.86% 74.34% 65.59% 73.38% 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 80.00% 90.00% 100.00% 0.00 10,000.00 20,000.00 30,000.00 40,000.00 50,000.00 60,000.00 70,000.00 2014 2015 2016 2017 2018 2019 Capacity Output Utilization Rate 56.05% 86.10% 83.17% 81.36% 79.58% 84.06% 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 80.00% 90.00% 100.00% 0.00 2,000.00 4,000.00 6,000.00 8,000.00 10,000.00 12,000.00 14,000.00 2014 2015 2016 2017 2018 2019 Capacity Output Utilization Rate

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• With new factory, Flexibles capacity has been

increased to over 150 million meters per year

• Utilization rate have been in range of 45 – 80%
• Capacity expansion requires longer lead time than
• ther products

Historical Production Capacity and Utilization Rate

Flexibles Paper

• With new factory, Flexibles capacity has been

increased to around 145 million meters per year

• Utilization rate was 46.98%
• Capacity expansion requires longer lead time than
• ther products
• With new factory, Paper capacity has been

increased to 510 million bags per year

• Utilization rate was 80.52%

80.33% 62.24% 58.77% 70.18% 67.23% 46.98% 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 80.00% 90.00% 0.00 20.00 40.00 60.00 80.00 100.00 120.00 140.00 160.00 2014 2015 2016 2017 2018 2019 Capacity Output 96.55% 89.49% 70.73% 80.52% 0.00% 20.00% 40.00% 60.00% 80.00% 100.00% 120.00% 0.00 20.00 40.00 60.00 80.00 100.00 120.00 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Capacity Output Utilization Rate

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Agenda

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Section 1 About TPBI Group Section 2 Business Overview Section 3 Financial Highlights Section 4 Future Plan

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Market Overview

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Source: Bloomberg

• Brent crude oil price had slightly increased

during the last quarter of 2019, averaging at USD 57.01 per barrel in 2019.

• The resin prices are somewhat influenced from

crude oil price.

• The average prices of HDPE and LLDPE were

992.29 and 954.02 per MT respectively in 2019

RHS)

Resin Price Brent Crude Oil

• 200.00

400.00 600.00 800.00 1,000.00 1,200.00 Jan-2019 Feb-2019 Mar-2019 Apr-2019 May-2019 Jun-2019 Jul-2019 Aug-2019 Sep-2019 Oct-2019 Nov-2019 Dec-2019 LLDPE HDPE

• 500,000.00

1,000,000.00 1,500,000.00 2,000,000.00 2,500,000.00 3,000,000.00 3,500,000.00 4,000,000.00 10 20 30 40 50 60 70 Total Market Volume (RHS) Mid Price Close

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Market Overview (Cont’)

• Thai Baht had continually appreciated during

the year, averaging at THB 31.04 per USD

• TPBI revenue and cost are partially natural-hedged

Foreign Exchange (THB/USD) Foreign Exchange (MMK/USD)

• During the year, Myanmar Kyat had fluctuated in

limited range and slightly appreciated during Nov – Dec 2019, averaging at MMK 1,521.75 per USD

• During the year, GBP had depreciated below 40

THB in 3Q2019, however, GBP had gradually appreciated during 4Q2019, averaging at 39.65

Foreign Exchange (GBP/THB)

28 29 30 31 32 33 1,420.00 1,440.00 1,460.00 1,480.00 1,500.00 1,520.00 1,540.00 1,560.00 34 36 38 40 42 44

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2018

Operating Results

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Total Revenue Gross Profit and Net Profit

Source: CompanyData

Revenue Breakdown

4,729

• 1,000

2,000 3,000 4,000 5,000 2017 2018 2019 THB mm 5,011

5,364

1178 1333 1710 1708 1072 563 423 494 515 666 734 735 336 273 535 754 680 631

• 1,000

2,000 3,000 4,000 5,000 2017 2018 2019

THB mn

Revenue by Product

Garbage bags and fruit&vegetable bags Vest carriers/t-shirt bags Multi-layer blown film Flexible packaging Flat Cut Bags&Soft Loop Paper packaging Trading Others 203 75 391

• 10
• 5

5 10 15 2017 2018 2019 Gross Profit Net Profit

9.35% (1.03%) (4.53%) 5.78% 10.5% 4.0%

• In 2019, the revenue was slightly increased compared to last year

mostly due to higher Garbage bags as well as the fully accumulated revenue from TPBI UK, TPBI Paper and TPBI Australia (formerly known as Intelipac Group). Revenue from vest carriers/t-shirt bags sharply declined provided such is in line with policy of the company to diverse product portfolio

• The increase in sales of Consumables, mainly from garbage bags.

Whereas, Multi-layer blown film and Flexibles products’ proportion remain the same portion comparing to overall revenue of Company Group.

• The profit margin was better due to the control of cost

management in Consumables. However, the Company also have a plan to closely control cost management of Flexibles and Paper for better profit margin of the Company group.

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Operating Results (Cont.)

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Operating Result in 2019

For the financial year of 2019, the Company accounted a net loss of THB (55.43) million, decreasing from net loss of THB (227.25) million or decreased by 75.61% in the year earlier. The key driver is from the mentioned factors as follows:

• The Company received continuous garbage bags’ orders from a new

foreign customer since the beginning of the second quarter. In addition, the Company also received Soft Loop (Reusable Bag)’s order from foreign customer and some new orders from domestic market. The foregoing

• rders cause positive effect to the Company. This is also in line with

business transformation policy of the Company as a result of change in customer’s demand of global packaging industry

• The decrease of non-recurring expenses
• The exchange rate of Thai Baht against US Dollar had been continuously

appreciated

• The exchange rate of Myanmar Kyat against US Dollar had been stable.
• The control of cost management effects to the decrease of production cost
• f Consumables

Source: CompanyData

Sales

5,298.86 4,980.35 318.51 6.40%

Revenue

5,364.37 5,011.02 353.35 7.05%

Cost of Sales

4,803.38 4,692.56 110.82 2.36%

Gross Profit

495.48 287.78 207.7 72.17%

Other Income

65.51 30.67 34.84 113.60%

SG&A

577.15 506.72 70.43 13.90%

EBITDA

262.18 126.22 135.96 107.72%

Net Income

• 55.43
• 227.25 171.82

75.61%

Net Income attributable to company's shareholders

• 34.09
• 209.13 175.04

83.70%

EPS ( THB )

• 0.08
• 0.52

0.44 84.62%

GP Margin (%)

9.35% 5.78% 3.57% 61.76%

EBITDA Margin (%)

4.89% 2.52% 2.37% 94.05%

NP Margin (%)

• 1.03%
• 4.53%

3.50% 77.26%

In THB mm 2019 2018 YoY THB mm %

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Operating Results (Cont.)

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Analysis of Net Loss in 2020 compares to 2019

Unit: THB ‘000

Note: :*SG&A in FY2018 includes non-recurring expense in total of THB 108 mn. Source: Company Data

NP 2017

• Chg. in

Revenue incomes

• Chg. in COGS Chg. in SG&A
• Chg. In other
• Chg. In profit Chg. Ininterest

(loss) from expenses Forex

• Chg. In

Corporate Tax NP2018 91,265.00 (19,555.00) (89,991.00) (94,697.00) (53,421.00) (77,394.00) (55,429.00)

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4Q18 4Q19

Total shareholders' equity Total current liabilities Total non-current liabilities

2,643 2,552 375 388 2,021 1,718 4Q18 4Q19 PP&E Other non-current assets Total current assets

Balance Sheet Composition

Page14 (THBmm)

Assets Breakdown Liabilities and Equity Breakdown

(THBmm)

Cash & ST Investment 2019: THB 154 mm 2018: THB 248 mm Inventories 2019: THB 766 mm 2018: THB 872 mm A/R 2019: THB 770mm 2018: THB 868 mm PP&E 2019: THB 2,552mm 2018: THB 2,643 mm Interest-bearing-debt 2019: THB 1,643 mm 2018: THB 1,850 mm Net Debt 2019: THB 2,304mm 2018: THB 2,598mm Share Capital 2019: THB 417 mm 2018: THB 417 mm

Gross Debt to Equity

Key Financial Ratios

Net Debt to Equity CurrentRatio Cash on Hand 2019: 0.70x 2019: 0.63x 2019: 1.02x 2019: 154mm 2018: 0.76x 2018: 0.66x 2018: 1.13x 2018: 248mm

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Strictly Private & Confidential

Agenda

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Section 1 About TPBI Group Section 2 Business Overview Section 3 Financial Highlights Section 4 Future Plan

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• Utilize TPBI’s expertise in import and export in international market to serve

customer’s demand for plastic and other bags

• TPBI’s paper bags production and sale based in UK will continue to increase its

market shares in UK and other nearby country. In addition, feasibility study have been conducted for paper bags market in Thailand and paper factory is

• n process of setting up and expect to start manufacturing by Q3 of 2020
• New factory has been operated since Sept 2018. Currently focusing on utilize

an increase in production capacity and enhance production efficiency

TPBI 2020 Outlook

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Consumable Products

Flexible Packaging Global Trading ReusableBags Garbage Bags Other Plastic Bags Multilayer Blown Film Flexible Packaging Paper Bags Plastic and Other Bags Vest Carrier Bags/ T-

• Shirt Bags

Continue to maintain market shares in existing market as well as obtain purchase orders from new customers in order to maximize production capacity

• Utilize production capacity shifted from Vest Carrier in order to serve stronger

demands from both oversea countries such as USA, Australia and other European countries, and domestic market

• Increase production capacity to meet an increase in demands from both
• versea countries, especially from USA, and domestic market
• Continue to increase market shares of other plastic bags in order to optimize

product portfolio risk and support margins

• Focusing on sales to domestic manufacturer in food industry while looking for

an opportunity in other market both domestic and overseas Paper

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Updated Actions and Future Plan

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Market Expansion

• Transformation project has been

started since 2017 in order to diverse production of vest carrier/t-shirt bags to new products and markets. Transformation gradually effects revenue and profit of Company group especially Consumables. Further, transformation products help to optimize product portfolio risk and support margins

• Paper bag will possibly be

commercially operated in Thailand by Q3 of 2020

• The Company will focus on

expanding transformation products; e.g. garbage bags and reusable bags in domestic market

• Focus on exploring new

customers in new market to be in accordance with the capacity of the new factory (T.A.K. packaging and Paper)

• Focus on control of cost

management for better profit margins

• Focus on strengthen and

expand M&A subsidiary companies.

Organic Growth Flexible Packaging & Film Inorganic Growth Merger & Acquisition

Source: CompanyData

Paper (UK)

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Hot issue: Plastic Bags Banned in Thailand

• From 1 Jan 2020 – many retailers and convenience stores agree to NOT provide vest carrier/t-shirt

bags to all customers

• Examples of other countries that issued plastic bag banned
• Packaging that will be used instead of vest carrier/t-shirt bags
• Impact to TPBI
• WON Project by TPBI

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More info: Facebook – www.facebook.com/wontogether

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Investor Relations

• TPBI Public Company Limited

42/174 Moo 5, Raiking Sampran Nakorn pathom 73210 Thailand

• Tel: +66 (0)2 4290354-7
• Fax: +66 (0)2 4290358
• E-mail: ir@tpbigroup.com