investor presentation 2018agribusiness / agro & food industry name thai wah public company...

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

INVESTOR PRESENTATION 2018

Private for Investor Forum 1

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 ”

Private for Investor Forum

Company Overview

2

AGENDA

Business Highlights

Starch Business & Food Business

Financial Performance

Appendix

Going Forward & Opportunities

Business Highlight


BUSINESS HIGHLIGHTS IN 2018

• Strong Revenue Growth for “Food Business”, +5% YoY, Rice noodle +28% YoY

• Commenced 1st Thai Wah Bio Power Plant at Udonthani

• Commenced Tapioca Chip trading at Thai Wah Cambodia & Vermicelli Noodle at Thai Wah Vietnam

• Challenging Raw Material Supply in 2018

Business Overview


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 - Thai7.5% Institution -

Foreigner8.9%

Retail - Thai19.8%

Retail -Foreigner

6.7%

Ho Family40.4%

LRH10.1%

Thai NVDR6.7%

Shareholder structure**

** Data as of 31 Jan 2019

Free float 46%**Market Cap : around 7,043 MB**

COMPANY FACTSHEET


“Double Dragon” “Double Kilin”“Phoenix” “New Grade”“Alpha Brand”“Native Starch”

Starch and Related Business Food Products Business

Native Starch High-Value Added Vermicelli Rice Noodle

Dry & fresh mung bean vermicelli

Native tapioca starchfor:-

Glucose/Sweetener

Modified tapioca starch

Coarse Flour

Sago (Pearl)

Alpha starch

Food Industry / MSG

Paper Industry

Pharmaceutical

Textile Industry

Adhesive Industry

Dry & fresh rice noodles

Production Base : 6 factories in TH, 2 factories in VN & 1 factory in CBD

Customer Base : ~80% Export and ~20% Domestic (TH only)

Production Base : 1 factory in TH & 1 factory in VN

Customer Base : ~92% Domestic and ~8% Export

Capacity : 456,000 tons for Native Starch and 50,000 tons for Glucose Capacity : 22,000 tons for Vermicelli and 4,000 tons for Noodles

THAI WAH BUSINESS OVERVIEW

Others

Bean Sheet (Shanghai noodle)

Tapioca starch

Pearl / Sago

“Glucose” “Pearl / Sago”

7

Starch Business


TAPIOCA PRODUCTION

Country 2010 2011 2012 2013 2014 2015 2016 2017 2018 *2019

Thai 22.006 21.912 26.601 30.228 30.022 32.358 30.558 30.936 27.875 29.975

Vietnam 8.596 9.875 9.746 9.757 10.210 10.453 10.578 10.653 8.000 9.000

Cambodia4.249 8.214 7.614 7.541 7.933 11.943 13.222 13.387 9.100 11.000

Laos 0.500 0.362 1.061 1.254 1.630 2.382 2.410 1.558 2.300 N/A

Total 35.351 40.363 45.022 48.780 49.795 57.136 56.768 56.534 47.275

Source : ASEAN Food Security Information System (AFSIS)

Note : *2018 & 2019 was forecast data from TTTA

Unit : Million Tons

Recoveryfrom

the bottomin 2018

Raw material recovery from the bottom in 2018


315 320329 328 328 328 328 328

338

365

408425

445

473

524

548 553

520

485 488 496 504

476455

280

320

360

400

440

480

520

560

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

2017

10

NATIVE STARCH EXPORT PRICE MARKET

Year 2015 2016 2017 2018

AVG FOB / tons 421 350 345 497

Source : The Thai Tapioca Trade Association

USD/Ton

2015

2016

2018


NATIVE STARCH MARGIN GAP


Baht/Kg. In Q4,2018, raw material costs decreased less than ASP decreased & Thai Baht appreciated

2

4

6

8

10

12

14

16

Mar/16 Jun/16 Sep/16 Dec/16 Mar/17 Jun/17 Sep/17 Dec/17 Mar/18 Jun/18 Sep/18 Dec/18

Selling price (Month-1) Selling price (Month) Raw Material

Spread is likely to “Stable”


GROWTH IN EXPORT OF THAI TAPIOCA STARCH

Source : The Thai Tapioca Trade AssociationNote Tapioca Starch is including Native & Modified Starch

1.99

2.50 2.432.68

3.083.34

3.963.83

4.22 4.143.97

0%

5%

10%

15%

20%

25%

30%

35%

40%

0

1

1

2

2

3

3

4

4

5

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Unit : M. Tons


THAI WAH MARKET SHARE

Source : The Company and The Thai Tapioca Trade Association

Note : Data was by Volume

Taiwan, 9%

Other, 11%

Malaysia, 8%

Indonesia, 12%

China, 52%

USA, 4%

Japan, 4%

• The largest importer of Tapioca Starch in the world

• Thai Wah market share was 7.2% in 2018

CHINA

TAIWAN

• The 3rd largest importer of Tapioca Starch in the world

• Thai Wah market share was 19.9% in 2018

7% of Total Native

Starch Export

in 2018


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

14

Cambodia

OpportunitiesTapioca plantation and productivityimprovementInvestments in Tapioca given strongavailability of rootsStrong border links with Thailand andVietnam

Laos

OpportunitiesTapioca plantation and productivityimprovementTapioca chips, starch, export

Vietnam

Opportunities Enhancement of sweetener businessPho, Bun, Noodle, Rice Flour businessPioneer to introduce Fresh vermicelli

products to the market

Established new subsidiary

TWPC Investment (Cambodia) Company Limited

January 24, 2017 Manufacturing and distributing of

chip production and trading business KHR 4,000 million (Baht 35 million) 100% Holding

DEVELOP A FOOTPRINT ACROSS ASEAN

Source : The Company


CASSAVA ROOTS SOURCING STRATEGIES

NEW AREA

THAILAND

MAESOD

EXISTING

THAILAND

- Guarantee Price with Farmer Networks- Strategic Sourcing in Potential Areas

NEW AREA

CAMBODIA/LAOS

- Organic Cassava - Contact Farming for Cambodia/Laos



INTEGRATION & IMPLEMENTATION OF MSS M&A


The acquisition of assets from Maesot Starch & Maesot Biogas

Diversify supply sources of

raw materials

Increase production capacity

Supporting customer needs

worldwide

Factory in Tak province, close to Myanmar border

Total Tapioca plantation area 45,000-50,000 rai (200,000-250,000 Tons a year)

CAP. 200 tons/Day, with power plant 1.0 MW located

Farmers in Maesot do big scale of farming


CASSAVA ROOT STATIONS

Cassava Roots Station

Sustainable Raw Material

Get Fresh Root at Source

Convenient in Cash Card

Payment

Create a Good Relationship

with Farmers



TWBP FUTURE PLAN

1 Udonthani 1 Q1’18 Waste Water

2 Kalasin 1 Mid 2019Waste Water

+ Pulp

3 Nakhon Ratchasima 1 2021Waste Water

+ Pulp

4 Udonthani 2 2021 Pulp

5 Kalasin 2 2021 Pulp

Phase COD Materials


Cost savings

Food Business


Fresh Vermicelli Bean Sheet

Fresh Rice NoodleDry Rice Noodle

FOODS

Noodle Kit

Dry Vermicelli

New Grade Sago / Pearl

OUR FOOD PRODUCT

20

High product quality

No chemical preservatives &

gluten-free contents

Product & Food Hygiene

certification processes

1

2

3



FOOD DISTRIBUTION AND GO-TO MARKET STRATEGY

21

Phitsanulok

Udon Thani

Roi Et

Chonburi

Bangkok

Banglan

Surat Thani

Korat

Key long term driverLeveraging a Technology - Enabled platform

to build through Thailand and ASEAN

31%

growth YoY

for 2018

Chiang Mai

Nationwide Distribution Coverage

Strong growth in main cities i.e.

chieng Mai, Chonburi, etc.

Targeting double-digit growth with

10% Contributions for 2018

• Increase more SKUs

• Expand more customer base



MODERN TRADE CHANNEL

22

Visibility & DemonstrationOverview

2018 Performance

• 37% growth YoY

Strategies

• Enhance Visibility / Activate online• Expand new Customer / Channel• Increase more SKUs • Targeting double-digit growth in 2019

Where can find us ?


FOOD EXPORT OPPORTUNITY

23

Targeting double-digit growth with more than 10% contributions for 2019

26%

growth YoY

for 2018

Expansion more “Volume” especially in EU and USA / Exploring “New Customers” especially in CLMV & China


THAI WAH VIETNAM

24

MT Stores Wet Markets

600 120

Food

Operators

500

Our Distribution

Financial Performance


PERFORMANCE IN 2018

669

493

197

10.9% 7.9%2.7%

-50.0%

-40.0%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

0

100

200

300

400

500

600

700

800

900

1,000

2016 2017 2018

NP Margin

Revenue from Sales EBITDA

Gross Profit Net Profit (After MI)

6,163 6,265

7,248

5,000

5,500

6,000

6,500

7,000

7,500

2016 2017 2018

1,009

716 557

0

200

400

600

800

1,000

1,200

2016 2017 2018

1,563 1,383

1,185

25.4% 22.1%16.3%

-50.0%

-40.0%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

0

500

1,000

1,500

2,000

2016 2017 2018

GP Margin



Export 62%

Local38%

China & Asia83%

Europe7%

US & Canada5%

Middle East & Others

3%

Thailand74%

Vietnam14%

China12%

Native, 44%

HVA*, 36%

Food, 20%

27

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

SALES BREAKDOWN 2018

Thai Wah Group Sales Breakdown

Sales Breakdown by Base Operation

Thailand Sales Breakdown

Export Breakdown

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

Sales Breakdown by Business Thailand Sales Breakdown by Geographic


7,248 MB

7,248 MB

5,418 MB


-

500

1,000

1,500

Cash & Financial investment, 1,261

Financial Debt, 233

Unit : MB

Non-CA 3,884

CA, 3,188

0%

20%

40%

60%

80%

100%

Equity,5,866

Non-CL, 412CL 794

BV = 6.66 BAHT/share

Unit : MB

599671 655

204

0

400

800

2015 2016 2017 2018

2016 – 0.30 BAHT/share2017 – 0.32 BAHT/share, dividend payment on 25 May 20182018 – 0.32 BAHT/share, which will propose to the Shareholders’ meeting

232

264

282 282

0%

5%

10%

15%

20%

25%

30%

35%

40%

200

220

240

260

280

2015 2016 2017 2018

STRONG CASH POSITION 2018

Strong Cash with Debt-free position Balance sheet Composition

Operating Cash flow Increase in absolute dividend payout

Unit : MB Unit : MB

D/E (Debt - Interest bearing ) = 0.04


Going Forward


INVESTING 2B FOR GROWTH IN NEXT 2 YEARS

20%

CAPEX 2019E

40%

Annual Maintainance /Efficiency Improvement

Energy Saving Project

TWCBD Capacity Expansion

Total ~1,000 MB

40%

CAPACITY EXPANSION

GREENFIELD PROJECT

M&A

HVA Products in Thailand (Pearl / Coarse Flour / High Grade Starch / Rice flour)

Food in Vietnam

Thai Wah Starch in Cambodia Phase II

Biogas Power Plant (2 plants) Solar Roof Project

Starch & Starch-Related Food Products focus on Thailand & CLMV

PROJECT 2019E - 2020E



GOING FORWARD


• To be A leading Small Cap in ASEAN, recognized for

consistency and strong financial discipline. Strengthen

Regional capabilities across ASEAN and China.

• Core long term strategy to pursue High-single digit Growth

and Sustainability towards 10B Revenue and 1B EBIT in

medium term

• Consistently improve YoY on company operating margins,

increasing mix of HVA products and improving returns on

capital to shareholders

• Aggressive growth expansion, over the next 2 years with

~2B Baht investment through Greenfield and M&A

• Embracing technology and develop new strategic platform

of our value chain to a long term competitive advantage

Q&A

Contact: [email protected]

APPENDIX


STARCH PRICE (DOMESTIC VS EXPORT)

5,000

9,000

13,000

17,000

Jan

-13

Mar

-13

May

-13

Jul-

13

Sep

-13

No

v-1

3

Jan

-14

Mar

-14

May

-14

Jul-

14

Sep

-14

No

v-1

4

Jan

-15

Mar

-15

May

-15

Jul-

15

Sep

-15

No

v-1

5

Jan

-16

Mar

-16

May

-16

Jul-

16

Sep

-16

No

v-1

6

Jan

-17

Mar

-17

May

-17

Jul-

17

Sep

-17

No

v-1

7

Jan

-18

Mar

-18

May

-18

Jul-

18

Sep

-18

No

v-1

8

Starch Price Starch Export Price

THB/Ton

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

Start to recovery since Sep 2017


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

600

Mar

-08

Jun

-08

Sep

-08

De

c-0

8

Mar

-09

Jun

-09

Sep

-09

De

c-0

9

Mar

-10

Jun

-10

Sep

-10

De

c-1

0

Mar

-11

Jun

-11

Sep

-11

De

c-1

1

Mar

-12

Jun

-12

Sep

-12

De

c-1

2

Mar

-13

Jun

-13

Sep

-13

De

c-1

3

Mar

-14

Jun

-14

Sep

-14

De

c-1

4

Mar

-15

Jun

-15

Sep

-15

De

c-1

5

Mar

-16

Jun

-16

Sep

-16

De

c-1

6

Mar

-17

Jun

-17

Sep

-17

De

c-1

7

Mar

-18

Jun

-18

Sep

-18

De

c-1

8

Starch Export Price Root Price

USD/Ton


China stop to subsidy Corn that

drag tapioca price drop

Government guarantee price to farmer at price at

1.7 Baht/Kg

The ‘Mealy bug’ disease spread out in Thailand &

neighborhoodCorn starch price also

increase

The ‘Srilanka Mosaic virus’ disease spread

out in VN & Cambodia & low productivity of

cassava root

Baht/Kg.Government

intervene root price 2.5 Baht/Kg for this

crop

ROOT PRICE AND STARCH EXPORT PRICE

Move in the same trend


STOCK PRICE

6

7

8

9

10

11

12

13

4-J

ul-

16

25

-Ju

l-1

6

11

-Au

g-1

6

31

-Au

g-1

6

19

-Se

p-1

6

6-O

ct-1

6

26

-Oct

-16

14

-No

v-1

6

1-D

ec-1

6

22

-De

c-1

6

12

-Jan

-17

31

-Jan

-17

20

-Fe

b-1

7

9-M

ar-1

7

28

-Mar

-17

19

-Ap

r-1

7

9-M

ay-1

7

29

-May

-17

15

-Ju

n-1

7

4-J

ul-

17

24

-Ju

l-1

7

11

-Au

g-1

7

31

-Au

g-1

7

19

-Se

p-1

7

6-O

ct-1

7

30

-Oct

-17

16

-No

v-1

7

6-D

ec-1

7

26

-De

c-1

7

16

-Jan

-18

2-F

eb

-18

21

-Fe

b-1

8

13

-Mar

-18

30

-Mar

-18

23

-Ap

r-1

8

11

-May

-18

31

-May

-18

19

-Ju

n-1

8

6-J

ul-

18

25

-Ju

l-1

8

16

-Au

g-1

8

4-S

ep

-18

21

-Se

p-1

8

10

-Oct

-18

31

-Oct

-18

18

-Oct

-18

7-N

ov-

18

26

-No

v-1

8

17

-De

c-1

8

Stock Price

THB

Source : SET

XD on 8 May 2018 0.32 Baht / Share

The lowest price on12 Oct 2016 @ 7.25

investor presentation 2018agribusiness / agro & food industry name thai wah public company...

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