ThaiBev s Results Briefing in Singapore

Transcription

1 Investor Relations Department Richard Jones Ariya Silakorn Namfon Aungsutornrungsi investor.html ThaiBev s Results Briefing in Singapore On Friday 15 August 2008, ThaiBev s top management and IR team went to Singapore for the Half Year 2008 Results Briefing to analysts, institutional and retail investors at the InterContinental Hotel, Singapore. Mr. Thapana Sirivadhanabhakdi, ThaiBev s President and CEO, along with Mr. Sithichai Chaikriangkrai, Director and SVP, and Mr. Jean Lebreton, SVP, answered interesting questions from investors after the results presentation by Mr. Richard Jones, ThaiBev s Head of IR. At the event, Chang Beer Export was served and the Sabai Sabai cocktail, based from Mekhong spirits, was introduced to consumers in Singapore and was well-received. You can view the record of the briefing and listen to the recorded results conference call from ThaiBev s IR web: ThaiBev s executives answered questions from investors: from left to right Mr. Richard Jones, Mr. Thapana Sirivadhanabhakdi, Mr. Sithichai Chaikriangkrai and Mr. Jean Lebreton The Sabai Sabai cocktail, made with Mekhong, was introduced at the briefing ThaiBev joins Invest Fair 2008 Mr. Richard Jones presents ThaiBev s financial results of half year 2008 Thai Beverage Plc., as a Sapphire Sponsor, recently joined Invest Fair 2008 at Suntec Convention Center in Singapore. Held for the second consecutive year, the event provides a platform for investors to learn on the latest financial products and services, as well as to understand the market outlook from the experts. Mr. Richard Jones, the Head of IR, presented ThaiBev s business outlook for prospective retail investors and shareholders at two seminar sessions on both Saturday and Sunday. Invest Fair is the largest investment exhibition organized by Share Investor and supported by the Singapore Exchange. The seminar room was full of investors interested in ThaiBev s business Mr. Richard Jones gives information to investors at ThaiBev s booth

2 ThaiBev s new blended scotch whisky launched ThaiBev recently launched a new blended scotch whisky, Drummer, to tap a segment that ThaiBev has never entered before. This fiveyear old whisky is aimed at young modern urban male consumers, aged Made by Inver House, the heart of the blend comes from the Balmenach Distillery which gives Drummer its sensual fruity characteristics. The appealing taste of the whisky offers a real and unique Scotch whisky experience. Drummer: March to your own beat Inver House Distillers claims 11 medals at the International Spirits Challenge 2008 Share Data (All data as of 4 Sep 08) Price S$ Month Avg Daily Vol: 5.3 million shares Current Mkt Cap: S$ 5,524.2 million US$ 3,850.6 million Three-month price range S$ Source: Reuters Shares outstanding: 25,110 million shares IPO date 30 May 06 Share offered at IPO: 4,888.9 millions shares IPO offer price S$ 0.28 Source: Reuters Multi award-winning Inver House Distillers has notched up yet another success. The Airdrie distillery, which recently claimed the prestigious title of International Distiller of the Year, is celebrating yet more success having collected an astonishing 11 medals at the International Spirits Challenge Closely following the distillers' recent haul of 13 medals at the Scotch Whisky Masters Awards and 15 awards at the International Wine & Spirits Competition, this multitude of successes makes Inver House one of the most recognized Scotch whisky producers in the world. The International Spirits Challenge - now in its 13th year - promotes spirits from around the world. Each year, nearly 1000 spirits from across the globe are rigorously judged and tasted by the industry's leading international spirits experts, many of whom have flown in for the occasion from other countries. The accolades that Inver House were awarded at the International Spirits Challenge 2008 comprise two coveted gold medals, three silver medals and six bronze medals. For full release, please go to Inver House s homepage: For full list of award winners, please go to The gold-medal-winning Balblair Vintage 1975 and Hankey Bannister 40 Year Old

3 The Mekhong The Mekhong brand is named after the mighty Mekhong River which flows along the Thai border. The name Mekhong itself is derived from Mae Nam Kong, where Mae translates as 'mother' and Nam as 'water' meaning the "mother of waters" (river). In many ways this great river serves as a life force for rural Thailand with millions of people depending on it for food, water, transport and many other aspects of their daily lives including trade and tourism. ThaiBev expands presence to the UK with launch of Mekhong Thai Beverage PLC is pleased to announce the launch of Mekhong, the original branded Thai Spirit, in the United Kingdom ( UK ) through its subsidiary, International Beverage Holdings Limited ( InterBev Group ). This development follows the introduction of Mekhong to the United States in May this year, which has already seen an encouraging response from American consumers. Mekhong is now available from a number of wholesalers across the country including London, Brighton, Manchester, Liverpool, Glasgow, Edinburgh and Cardiff. Named after the Mekhong River, the brand has undergone a design revamp and it is this newly branded packaging that is being launched across international markets outside Asia. The new bottle and label will be introduced in its home market of Thailand later this year and the rest of Asia thereafter. Mekhong was launched in 1941 and is the original Thai branded spirit. Produced at the Bangyikhan Distillery, the drink is perfect with a mixer or as a cocktail base and fully complements the taste and flavours of Thai food. Mekhong rum has 35% alcohol-byvolume and is made mostly from molasses, rice and infused herbs and spices. An extensive marketing and promotional campaign has been initiated to position Mekhong as a traditional premium distilled and blended Thai Spirit, made exotic by its Thai origins. For more information, visit ThaiBev s websites Corporate website: IR Website: Federbrau website: Chang Beer export website: Mekhong export website: Interbev: Inver House: Analyst Recommendations Sell/ Reduce 15% Hold/ Neutral 38% Source: Analyst reports from 13 brokerage houses As of 5 Sep 08 Buy/ Outperform/ Overweight 47% 3-month Performance /2/2008 6/16/2008 6/30/2008 7/14/2008 7/28/2008 8/11/2008 8/25/2008 ThaiBev Close STI Rebased Source: 2 Jun Aug 08

4 Interview with InterBev s Executives by IMPACT Q: What opportunities have ThaiBev s public offering in Singapore opened up for the company? JACKSON: ThaiBev is a family company that s now transforming itself into a professionally managed company, so the IPO was an important step in professionalizing the management group, aside from the capital it raised for our future aspirations. Being a listed company rather than a private company simply gives us a better platform to build through partnerships as we grow into a more global company. Q: How has the Inver House acquisition changed InterBev? InterBev: After IPO, Southeast Asian Force Targets US Beer, Spirits Markets Editor s note: As western drinks players continue to sharpen their focus on Asia s rapidly growing markets, the region s own large firms are looking through the opposite end of the telescope. One of these is Thailand s Thai Beverage plc, which commands more than 65% of its domestic beverage alcohol market through dominant shares of both the beer and spirits sectors. By virtue of its Chang beer and Mekhong and Sangsom Thai spirit offerings, ThaiBev also boasts a significant presence across regional Southeast Asia, generating aggregate annual sales of approximately $3.1 billion. In 2005 ThaiBev, principally owned by Thai entrepreneur Charoen Sirivadhanabhakdi, opened Hong Kongbased International Beverage Holdings Ltd (InterBev) to promote a more global agenda, naming industry veteran Barrie Jackson to head up the new unit as president and CEO. The next year, ThaiBev upped its international profile significantly with a $900-million IPO on the Singapore exchange and the purchase of Inver House one of the world s largest bulk Scotch whisky producers, as well as the owner of Old Pulteney, Speyburn and Balblair single malts among other spirits brands along with Hong Kong based distributor Best Spirits, for roughly $47 million. Also in 2006, InterBev appointed John Lennon former president and CEO of both Pyramid Breweries and Beck s North America to lead its newly opened US unit. Last summer, InterBev USA began rolling out its flagship Chang beer brand in the US. This spring it s introducing its first spirits offering, Mekhong, intending to leverage the advantages of both brands in Asian influenced on-premise outlets into a mainstream following. IMPACT associate editor Daniel Marsteller recently met with Jackson and John Lennon to discuss InterBev s US launch and the progress of its global expansion. JACKSON: We re going through an integration process after which Inver House will handle our spirits portfolio outside Asia and North America. They re rolling out the Mekhong brand now in Europe. In the US, Constellation Spirits has done a very good job marketing the Speyburn, Old Pulteney and Balblair single malts, and we re not going to change that (under Constellation s spirits realignment, those brands recently moved to its newly formed Ascender Brands premium unit). Gaining Inver House immediately gave us a US presence in that regard, and that of course represents a huge opportunity to expand. Q: How has InterBev s launch into the US market progressed so far? LENNON: We rolled out Chang beer in California, Washington and Oregon around last July and reached the East Coast in the fall. Chang is now in New York, Massachusetts, Georgia, Florida, Chicago, Arizona, Nevada and Texas as well. There are basically two beer brands from Thailand available in the US. Singha (handled by multiple importers) is one that s already been here for more than 20 years. Chang is a newer brand in Thailand itself, only introduced in Page 22 May 1, 2008 To subscribe, go to Photo by: Jesse Baron

5 It gained over 50% market share in Thailand within three year s time. Q: How have US distributors and consumers responded to Chang in the early going? LENNON: We ve been very encouraged so far. We want to begin with Thai and fusion restaurants - there are more than 5,000 in the US market - and expand from there. Not many distributors have focused on that area of the market, and Chang represents their first calling on a lot of their accounts, so in addition to getting an elite super-premium import in Chang, it can pave the way for their other brands in these new accounts as well. JACKSON: We ve already enjoyed success with Chang outside Southeast Asia. It s been available in the UK for a few years now and is the sponsor of Liverpool s Everton Football Club. (In January, ThaiBev signed a three-year sponsorship renewal with Everton worth about $16 million.) That gives us tremendous exposure both in the UK and throughout Asia, where the English Premier League is huge. In New York, Chang is in trendy places with an active bar scene, like Highline Ballroom in the Meatpacking District and Sea in Williamsburg. It has a lot of potential to branch out in the broader market. Q: Then there s Mekhong, your first spirits offering in the US. How is that launch going and how are you positioning the brand? LENNON: Mekhong is the national spirit of Thailand, and it s also done well elsewhere in Southeast Asia. It s a blend of pressed cane, rice spirit and spice - including a dozen or so ingredients in all - which impart a truly unique flavor. It mixes very well, particularly with things like ginger ale, ginger beer and cola, for which we have signature drinks. Geographically we ll follow a similar route to that we used with Chang, starting on the coasts and following into Chicago and Texas - because that s where it can be bridged with a lot of existing Asian accounts and eventually build into a wider market. JACKSON: If you look at the marketplace, Asian spirits don t really feature. But you see the Asian food and culture trends rising in the US, so there s an opportunity there. InterBev has the capacity to make and market a wide range of spirits styles - from Asian white spirits to vodka, gin, rum and of course, with Inver House, Scotch - but we don t want to present Mekhong as merely one of a range of products we re bringing in form Asia. We re trying to create an iconic brand that can stand on its own in markets like the UK and US. Q: Have you seen any advantages from marketing both beer and spirits as you roll out in the US? LENNON: In the US, there haven t been many companies that do both, but you re starting to see a unique phenomenon in which a lot of spirits distributors are taking on beer and vice versa. We re trying to put these brands together in the same house wherever we can. Q: In the Thai market, along with Mekhong, you also have Sangsom, which is among IMPACT s Global Top 100 by volume. How do those brands fit into the domestic market in terms of positioning and price point? JACKSON: Sangsom (ranked 47 th among Impact s top 100 spirits brands worldwide in 2007) is currently the most premium brand within the locally-produced whisky category (most locally-produced golden spirits are molasses-based, but referred to as whisky ). Mekhong is also in this group. It s suffered from lack of investment over the years, but the current relaunch is positioning it squarely at the premium end. Of course, imported Scotch is positioned above local whiskies. First there s the standard segment (including brands like Pernod Ricard s 100 Pipers and Diageo s Benmore), and then there s the premium Scotch segment (Johnnie Walker and Chivas Regal). As yet ThaiBev has given little attention to the Scotch category, but with Inver House, we ll be debuting later this year. Q: What other international markets will be points of emphasis for InterBev moving forward? JACKSON: We want to extend our dominance of the Thai market to the surrounding region. And Inver House will give us further inroads. In India, for example, we inherited a bit of business through Inver House, which supplies whisky to Mason & Summers (a local producer) for the Glen Drummond range of bottled-in-india single malts. We re now aiming to expand there and have some ambitious plans along those lines. China is also an important developmental opportunity for us. We re bringing in premium international brands that we ll introduce in the conventional way, and then there s the local market, where we re interested in acquiring, mostly on the spirits side. In Southeast Asia, with markets like Malaysia, Cambodia and Vietnam, it s still early days, but the same premiumization dynamics will eventually start - and, as a regional player, that presents an opportunity for us to get our brands in there as the economies develop. One thing that s surprising is that beer is quite an aspirational product in the region. So we see a very bright future in a wide array of markets. Page 23 May 1, 2008 To subscribe, go to Photo by: Jesse Baron

6 News Summary Information provided here was released to the SGX. For more information, please visit the Newsroom on ThaiBev IR s website ( or check for the announcements on the SGX s website ( June 3, 2008 Increasing of shareholding in United Products Company Limited ( UPC ) ThaiBev, through its subsidiary Sura Piset Pattharalanna Co., Ltd. ( Sura Piset ), completed the acquisition of 80.82% of UPC in November The Board of Directors of Sura Piset, a direct wholly-owned company by ThaiBev, approved the acquisition of additional shares in UPC. THAI-FOON This is a cocktail with good Karma. Coconuts are used as offerings to the Gods and are also smashed as part of an initiation or inauguration of new projects, this act signifies a sacrifice of ego. With the Thai- Foon cocktail, less is more. INGREDIENTS 2 shots Mekhong 1 ½ shots coconut puree ¾ shot white Cr eme de Cacao Ground nutmeg METHOD Pour Mekhong and the rest of the ingredients into a mixing glass. Add ice and shake vigorously for 7 8 seconds. Strain into a chilled martinicocktail glass. Grind some nutmeg on top. Source: Sura Piset acquired the additional 600,369 ordinary shares from Poon Perm Paisan Co., Ltd. (PPPC) The shareholding increased from 80.82% to 97.98% of the issued and paid up share capital of UPC., at a consideration of 135 Baht per share. The payment for the additional shares was made upon the transfer and delivery of the additional shares. ThaiBev funded the cash injection through a loan to Sura Piset from its cash flow. UPC is engaged in the manufacture and distribution of spirits, including contract distilling for another spirit brand. July 14, 2008 Corporate Rating by Standard and Poors ( S&P ) S&P reviewed and affirmed ThaiBev s corporate credit rating at the same level as the previous year s rate, BBB and Outlook Stable. At present, Thailand Country Rating from S&P is BBB+. August 14, 2008 Book Closure Date for interim dividend Payment ThaiBev s Board of Directors Meeting which was held on August 14, 2008 approved the interim dividend payment is at 0.12 Baht per share. Book closure date: 29 August 2008 (by pm Bangkok time for shareholders whose names appear in the Thailand Securities Depositary or TSD register and by 5.00 pm Singapore time for shareholders whose names appear in the Central Depositary Pte or CDP register) Date payable: 11 September 2008 August 27, 2008 Extraordinary General Meeting of Shareholders (EGM) No. 1/2008 and Book Closure date The EGM will be held on September 29, 2008 at 2.00 pm (Bangkok time) in Bangkok, Thailand. Agenda: the consideration and approval of the acquisition of 43.9% of Oishi s shares and the disposal of 100% of Thai Alcohol Plc. shares. The book closure date for the share transfer with respect to the entitle to attend and vote at the EGM will be on September 11, 2008 from pm (Bangkok time) until the end of the day. Investors who hold shares through the CDP will only be entitled to vote at the EGM through CDP if their names appear in the CDP register at 5.00 pm (Singapore time) on the book closure date.

7 August 29, 2008 Incorporation of wholly owned subsidiary Thai Drinks Co., Ltd. Beer Volume Thai Drinks has an authorized capital of 1,000,000 Baht consisting of 10,000 ordinary shares with a par value of 100 Baht each. The initial called up capital was a partial amount of 25 Baht per share Thai Drinks will be principally engaged in the sale and distribution of drinking water The investment was funded through internally generated funds and is not expected to have any material impact on the earnings per share and net tangible assets of ThaiBev for this financial year. H1 07 H1 08 C hang Low Alc. Beer Spirit Volume H1 07 H1 08 White Brown ThaiBev announces half year results and interim dividend ThaiBev reported second quarter sales revenues of Baht 24,343 million, an increase of Baht 1,197 million, or 5.2% over the second quarter of ThaiBev President and CEO, Mr. Thapana Sirivadhanabhakdi, said spirits sales continued to be on the upswing and drove the company s revenue growth throughout the quarter. During the period, the company also found it necessary to raise the prices of two of its best-selling white spirits products. In the first six months of the year, Mr. Thapana noted that the total sales revenue of the company had increased by 1,976 million baht over the first six months of This was largely due to spirits sales rising by 2,557 million baht or 9.8% to 28,719 million baht for the first half of 2008 over the same period in The company also declared an interim dividend of 0.12 Baht per share for the first half of 2008 representing a 60% payout ratio. H Sales H Profit 49,107 51,083 28,719 26,162 23,086 21,272 5,260 5,019 4,210 4, (491) (30) 1, (81) (38) (20) 39 (24) Group Beer Spirit Non-alcoholic Beverages Industrial Alcohol Elimination Group Beer Spirit Non-alcoholic Beverages Industrial Alcohol Elimination H1'07 H1'08 H1'07 H1'08 Dividend Payment Interim 2008 Date Net profit 5,019 M Baht XD Date Aug 08 Number of shares 25,110 M shares Close book date 29 Aug 08 Dividend 3,013 M Baht Pay dividend 11 Sep 08 Portion of net profit 60% Dividend per share 0.12 Baht

8 FAQ on RESULTS, AGM AND EGM INFORMATION 1. When is the company s next results briefing? ThaiBev will announce its next results within 45 days of an interim period and 60 days after the end of the year. Please refer to for updates (click on 'Listed Companies' and then on 'Announcements'). Please note that the results conference calls are open to all investors. Details of these calls are usually posted around one week in advance on (click on 'Listed Companies' and then on 'Announcements'). 2. When and where will the next Annual General Meeting ( AGM ) be? Our Board of Directors will convene an annual general meeting of shareholders within four months from the last day of our fiscal year. Our recent 2008 AGM was held on April 28, 2008 in Bangkok, Thailand. 3. How may Singapore Shareholders vote at a Meeting of Shareholders of ThaiBev? Under applicable Thai laws, all general and extraordinary meetings of shareholders shall be held in Thailand. Investors who hold shares (including Singapore investors) through the Central Depository (Pte) Ltd., or CDP, in Singapore may instruct the CDP to exercise voting rights for their shares in accordance with the terms and conditions for the operation of securities accounts with the CDP. However, under Thai law, the CDP will be the only holder of record of these shares and accordingly the only person or entity recognized as a shareholder and legally entitled to vote on any matter to be submitted to the vote of our shareholders as a general or extraordinary meeting of shareholders. To ensure all shareholders have the right to vote on resolutions of shareholders meetings, ThaiBev arranges for Voting Instruction Forms (VIF) to be sent to everyone holding shares in ThaiBev through a CDP account. Through the VIF, shareholders can instruct the CDP how to vote on their behalf. The CDP may split its vote on each resolution to ensure that all voters instructions are implemented. The VIF must be filled in and returned to the CDP before the final date specified by the CDP. 4. How may shareholders whose shares are held by the CDP attend shareholders meetings in Thailand? If any investor wishes to attend a shareholders meeting in Thailand personally, their shares held by the CDP must be transferred to register in their name with the Thailand Securities Depository (TSD) in Thailand, for which they must pay stamp duty of 0.001% 1 of the value of the shares on that date 2. This process may take from two to three weeks and must be completed before ThaiBev closes its share register. The book closure date is usually announced two weeks in advance. If, after the shareholders meeting the shareholder wishes to transfer the shares back to the CDP, in order to trade them in future, the transfer will require another payment of stamp duty of 0.1% of the value of the shares and may take two or three weeks to complete. Note: 1. Every Baht 1,000 shall be paid for stamp duty of 1 Baht. 2. We understand that there will be duty and fees charged under Singapore laws, such as stamp duty and a withdrawal fee. 5. If I cannot travel to Thailand for the AGM, are there other avenues to express my opinions? For complete FAQ, please go to FAQ page on ThaiBev s website: ThaiBev IR makes regular visits to Singapore. Whenever we hold a retail investor meeting, you are encouraged to tell us of your concerns and wishes so that they can be passed on to management and the Board of Directors. ThaiBev strongly encourages Singapore investors to fill in the voting instruction form (VIF) that they will receive prior to every AGM or other shareholder meeting, and send it to the CDP for action. 6. When will information about the EGM be available? We will upload the invitation via SGX-Net on September 12, 2008 after trading hours. In addition, we understand that SGX will upload both Invitation and Circular on SGX-Net on the same day or a day after that.