Companys Performance Q1/2020 13 May 2020 integration innovation - - PowerPoint PPT Presentation

integration innovation intimacy

Company’s Performance Q1/2020 13 May 2020

integration innovation intimacy integration innovation intimacy

AGENDA

Our Business 2 Q1/2020 Financial Performance 1 3 Business Outlook for Q2/2020

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Our Business

AIR FREIGHT SEA FREIGHT & INLAND TRANSPORT LOGISTICS MANAGEMENT CHEMICAL & SPECIALTY LOGISTICS

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▪ Cargo General Sales Agent (GSA): exclusive sales agent of

• All AirAsia Airlines under Teleport Thailand
• Sri Lankan, Lan Cargo, Bhutan, Jeju Airlines and

US Bangla Airlines for all routes from Thailand ▪Wholesale Freight Forwarder : providing domestic and international air freight services for co-loaders ▪Air Cargo Terminal : International and domestic cargo terminal at Don Muang Airport

AIR FREIGHT

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▪ Shipping Line Agencies :

• Thailand Joint Venture : CK Line

▪Wholesale Freight Forwarder : Thailand Joint Venture with ECU Worldwide, global leader in Less-than Container Load (LCL) services with network in over 160 countries ▪Inland Container Trucking Services: transport containers to and from seaport / container depot

SEA FREIGHT & INLAND TRANSPORT

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▪Integrated Freight Forwarder : International freight forwarding services for both sea & air transport and customs clearance for retail customers ▪Warehousing : storage, inventory management, and real-time reporting ▪Distribution Management : modern trade, shops, home delivery ▪Fulfillment Service : focus on E-Commerce and end to end supply chain services

LOGISTICS MANAGEMENT

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▪Integrated Freight Forwarder : International freight forwarding services for both sea & air transport and customs clearance for chemical & dangerous goods ▪Dedicated Chemical Warehouse : storage, inventory management, and real-time reporting ▪Inland and Distribution Management : for industrial and B2B market ▪DG Packaging : sale of packing materials, DG declaration and repacking services ▪ISO Tank Business : as agent for Nippon Concept Co., Ltd, a Japanese based ISO tank

• perator for liquid chemical

CHEMICAL & SPECIALTY LOGISTICS

integration innovation intimacy integration innovation intimacy

AGENDA

Our Business 2 Q1/2020 Financial Performance 1 3 Business Outlook for Q2/2020

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58% 3% 8% 31% 73% 3% 6% 18%

Performance Q1/2020 – Revenue

Remark: 1/ Airfreight revenue did not include GSA revenues from servicing AirAsia in the approximate amount of THB 100 million since TLP-TH was categorized as Joint Venture 2/ Sea freight revenue significantly decreased since Rizhao ceased its business since January 2020 3/ After eliminating inter-company transactions.

% Revenue Contribution Q1/19 vs Q1/20

Unit : Million Baht

Q1/19 vs. Q1/20 Q4/19 vs. Q1/20

Revenue Q1/19 Q1/20 YoY Q4/19 Q1/20 QoQ Airfreight 547.0 242.21/ (56%) 534.2 242.21/ (55%) Sea freight 22.3 11.92/ (47%) 20.8 11.92/ (43%) Logistics 48.3 34.9 (28%) 42.5 34.9 (18%) Chemical 133.4 130.4 (2%) 127.5 130.4 2% Total Revenue 750.9 419.3 (44%) 725.0 419.3 (42%) Revenue Consol3/ 682.6 407.6 (40%) 648.8 407.6 (37%)

• 40%
• 37%

682.6 407.6 648.8 407.6 Q1/19 Q1/20 Q4/19 Q1/20

Chemical Airfreight Logistics Sea freight Chemical Sea freight Airfreight

Q1/19 Q1/20

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47% 13% 13% 27% 44% 7% 12% 37%

Performance Q1/2020 – Gross Profit

% Gross Contribution Q1/19 vs Q1/20

Unit : Million Baht

Q1/19 vs. Q1/20 Q4/19 vs. Q1/20 Q1/19 Q1/20

Gross Profit Q1/19 Q1/20 YoY Q4/19 Q1/20 QoQ Airfreight 55.3 38.9 (30%) 38.2 38.9 2% Sea freight 15.7 5.81/ (63%) 14.7 5.81/ (60%) Logistics 15.2 10.2 (33%) 12.1 10.2 (16%) Chemical 31.1 32.4 4% 30.9 32.4 5% Total Gross Profit 117.3 87.3 (26%) 95.8 87.3 (9%) Gross Profit Consol2/ 114.0 86.4 (24%) 94.3 86.4 (8%) GPM 16.7% 21.2% 14.5% 21.2% 114.0 86.4 94.3 86.4 16.7% 21.2% 14.5% 21.2% 5.0% 10.0% 15.0% 20.0% Q1/19 Q1/20 Q4/19 Q1/20

• 50.0

0.0 0.0 0.0

• 24%
• 8%

Chemical Airfreight Chemical Sea freight Airfreight Remark: 1/ Gross Profit significantly dropped as a result of the decreased in revenue due to Rizhao ceasing its services, a high margin business for Sea freight business unit. 2/ After eliminating inter-company transactions.

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Performance Q1/2020 – SG&A

SG&A Extraordinary Items:

• 1. Provision for Employee benefit obligations in Q1/19 was reversed for amount of THB 13 million, resulting in a decrease of SG&A;
• 2. In Q1/20, the Company transferred employees to TLP TH which cost for amount approximately of THB 10 million; and
• 3. The adoption of TFRS 16 that results in an increase of rental and lease obligation related expenses.

80.5

Unit : Million Baht

Q1/19 Q1/20 83.1

Q1/19 vs. Q1/20 Q4/19 vs. Q1/20

SG&A Q1/19 Q1/20 YoY Q4/19 Q1/20 QoQ Selling Expense 17.3 17.6 2.1% 19.6 17.6 (10.0%) Admin Expense 63.2 65.4 3.5% 70.5 65.4 (7.2%) Total SG&A 80.5 83.1 3.2% 90.1 83.1 (7.8%) 13.4 10.0 93.9 93.1

Reverse EBO Provision Transfer to TLP-TH

90.1 Q1/19 Q1/20 83.1 10.0 90.1 93.1

Transfer to TLP-TH Effect from TFRS16 Effect from TFRS16

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Performance Q1/2020 – Net Profit

Unit : Million Baht

Q1/19 vs. Q1/20 Q4/19 vs. Q1/20

42.9 22.5 28.4 22.5 6.3% 5.5% 4.4% 5.5%

• 10.0

20.0 30.0 40.0 50.0 Q1/19 Q1/20 Q4/19 Q1/20 0.0% 2.0% 4.0% 6.0%

• 47%
• 21%

Net Profit Q1/19 Q1/20 YoY Q4/19 Q1/20 QoQ Net Profit Consol 42.9 22.5 (47%) 28.4 22.5 (21%) NPM 6.3% 5.5% 4.4% 5.5%

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Analysis

Overall Performance Q1/2020

Unit : Million Baht Q1/19 Q1/20 Change % Change + / (-) Revenues from sales and services 682.6 407.6 (275.0) (40.3%) Costs of sales and services 568.6 321.2 (247.5) (43.5%) Gross profit 114.0 86.4 (27.5) (24.2%) Gross profit margin (%) 16.7% 21.2% 4.5% Other income 2.3 3.7 1.4 62.9% Selling expenses 17.3 17.6 0.4 2.1% Administrative expenses 63.2 65.4 2.2 3.5% Gain (loss) on exchange rate - net 0.6 0.3 (0.4) (61.0%) Financial Cost 2.5 6.5 4.1 166.3%

Share of profits from investment in Asso&JV

16.0 23.4 7.4 46.5% Net profit 42.9 22.5 (20.3) (47.4%) Net profit margin (%) 6.3% 5.5% (0.8%)

▪ Gain (loss) on exchange rate affected by the depreciation of Thai baht in the early of this year, however, the adoption of TFRS 9 that affected the impairment of forward contract. ▪ Financial Cost increased due mainly to the cost of acquiring Around Group and other Financial Cost that has been change due to TFRS 16. ▪ The Company was able to maintain profits from Asso&JV. A part of an increase in Share of profits was from a full recognition of Around quarterly profit, while it was partially recognized in Q1/19 ▪ The main source of GSA revenue from servicing AirAsia, which generated revenue of THB 290 million on Q1/19, decreased as the Business model changed from the Company owned services to Joint Venture with TLP-TH. The Company recognize its performance as Share of profits from investment in Asso&JV instead. ▪ COVID-19 outbreak affected the overall services volume, resulting in a decrease in revenue and gross profit

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Financial Status as of 31 March 2020 Financial Ratio

Liability Equity Asset

Ratio YE18 YE19 Q1/20 Company Performance ROE (%) 1/ 13.0% 13.3% 11.2% Collection Period (days) 42.1 45.9 51.9 Payment Period (days) 61.1 67.8 69.8 Debt Performance Current Ratio (times) 2.1x 1.2x 1.0x D/E Ratio (times) 0.6x 0.7x 1.0x IBD/E Ratio (times) (Bank Covenant <1.25x) 0.0x 0.3x 0.7x DSCR (times) (Bank Covenant >1.25x) 14.5x 3.0x 1.7x Profitability Performance Gross Profit Margin (%) 17.5% 16.1% 21.2% EBITDA Margin (%) 7.9% 8.9% 13.8% Net Profit Margin (%) 5.4% 6.1% 5.5% EPS (Baht per share) 0.25 0.27 0.04 Trailing 12M EPS (Baht per share) 2/ 0.25 0.27 0.24

Remark : 1/ Trailing 12M Net Profit 2/ Adjusted EPS based on existing shares at that time

Core Asset Million Baht Cash 433 AR 423 PPE 189 Investment (JV&Asso) 1/ 989 Core Liability Million Baht AP 314 IBD2/ 643

Unit : Million Baht

Remark : 1/ DGP THB 266 million, Around THB 513 million and GV THB 65 million 2/ Short-term loan THB 290 million / Long-term loan THB 285 million and Leasing THB 69 million

Financial Health Q1/2020

2,641 1,308 1,333 Asset Liability and Equity

integration innovation intimacy integration innovation intimacy

AGENDA

Our Business 2 Q1/2020 Financial Performance 1 3 Business Outlook for Q2/2020

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Triple i 2021 Aspirations and Strategy

Customer-driven growth:

▪ Maintain leadership position in DG, as integrated logistics provider, grow regionally ▪ Integrated logistics through “Triple i Solution” ▪ “Organic Plus” - key Customer focus to identify unmet needs and pain points in order to uncover new services

BU Strategy Strategic directions Aspirations Partner-driven growth:

▪ Lock in key long-term partners (airlines, network, authorities) ▪ Wholesale business model and related services ▪ Create new innovative products with partners (masterpiece for Thailand) ▪ “Organic Plus” – key partner focus to identify unmet needs and pain points in order to uncover new services

• Partnership with Teleport
• Focus on e-commerce

customer

• Air cargo terminal at DMK

and HKT

• Grow its current customer

base and new customers in import businesses by leveraging new IT platform

• Growth with CK Line
• Seeking new shipping line

partner

• Grow by further penetration
• f its current customer

base and acquisition of new customers

• 1. Air Freight
• 2. Sea Freight
• 3. Chemical
• 4. Logistics

Leading Thai Logistics House with sustainable growth in SEA

Inorganic growth by Business Development (BU-5)

• Leverage GSA business through Around Logistics and Teleport
• Focus on new logistics platform
• Expand on air cargo terminal and ground handling service nationwide
• Growth through new in-land transport partners and new platform
• Growth with TLP : E-commerce, Asia Same day and Thailand Same day delivery

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Business Plan Q2/2020

➢ Charter Flight – new business model with TLP-TH: Offer chartered flight service in selecting routes with high demand and profit. In April 2020, the Company started providing chartered flight service to various countries in Asia. ➢ Cost management: Continual cost management procedure to reduce costs, particularly in warehouse management business at Don Mueang Airport. Results from the implementation of such strategies can be seen from Quarter 2 onwards. ➢ Increase cross-border transport and develop other forms of inland transport ➢ International freight for projects of key account customers: Start providing international freight for projects of customers who are key accounts that was delayed from the 1st quarter ➢ Multimodal Transport: Develop multimodal transport such as transport of product through Thailand from China via sea freight and to Laos via cross-border transport. ➢ Focuses on B2B customer base to compensate for retail customers who had been affected from closing of department stores and modern trade ➢ Cost management: Managed costs of International freight to be more efficient. Also, reduced fixed costs in warehouse service business for general products and chemical products

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Business Strategies for Business Development Unit (BU 5)

The COVID-19 outbreak has created a changing trend in consumer behavior in using logistics services, demanding diverse forms of services. The Company has put great importance on local logistics service and logistics service within the region under the three main principles: Expansion of business through cooperation with business partners 1 Expansion of scope of logistics services 2 Development of logistics services via digital platform 3

• Cargo flight service
• Asia24
• Thailand24
• AOTGA ground handling services
• Express Center at Don Meng Airport
• Project Cargo Handling & Cross Border and Rail transport
• Fulfillment Center for fresh food products using online trade

channel

• E-Commerce platform

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Business Strategies for Business Development Unit (BU 5)

Expansion of business through cooperation with business partners

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• Cargo flight service: the Company, in cooperation with TLP-TH,

prepares to change its business model to offer cargo flight service

• f which the schedule will be more routine and reliable.
• Asia24: Express air freight service within the region for B2B

customers, through cooperation with regional business partner with special expertise.

• Thailand24: Local express air freight service through cooperation

with business partner.

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Business Strategies for Business Development Unit (BU 5)

• AOTGA ground handling services: AOTGA has prepared for

expansion of services to other international airports in Thailand, which is expecting to start in the beginning of Q4/2020 (currently provide services at Don Mueng Airport only).

• Express Center at Don Meng Airport: expected to commence

services in Q4/2020.

• Project Cargo Handling & Cross Border and Rail transport: in the

process of studying joint investment plan with potential partner.

Expansion of scope of logistics services

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Business Strategies for Business Development Unit (BU 5)

• Fulfillment Center for fresh food products using online trade

channel: develop new product with X Commerce who expertise in creating platform for E-Commerce business and Sokochan who provide service for E-Commerce customers both of which are a subsidiary of GV, the Company’s joint venture.

• E-Commerce platform: jointly develop E-Commerce platform

for specific product with Partner to supplement the Company’s existing logistics business.

Development of logistics services via digital platform

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