Click to edit Master title style

Click to edit Master title style 9M2018 Business Update October 2018 MUF07 P/L Report Click to edit Master subtitle style

CONSOLIDATED MSN PERFORMANCE 2

Growth Fundamentals Intact with 90% Core Profit Growth in 9M2018 KEY FINANCIALS 9M17 9M18 % Growth 3Q17 3Q18 % Growth 9M2018 Performance Net revenue 27.5 26.6 (3)% 9.4 9.2 (3)% MCH 8.9 11.9 33% 3.4 4.4 27% MNS 14.6 10.0 (31)% 4.6 3.3 (28)% MSR 3.9 4.7 19% 1.4 1.4 6% EBITDA 6.2 7.7 24% 2.5 2.6 2% NPAT Post-MI 1.2 3.8 212% 0.8 0.7 (1)% Core NPAT Post-MI 1 1.2 2.3 90% 0.8 0.7 (1)% EBITDA margin 23% 29% 6% 27% 28% 1% Core NPAT Post-MI margin 4% 9% 4% 8% 8% 0% EPS (VND/share) 1,051 3,601 243% 655 710 8% Core EPS 3 (VND/share) 1,048 1,983 89% 655 643 (2)% EXCLUDING ONE TIME IMPACT Core NPAT Post-MI (if excluding MNS) Core NPAT Post-MI (if normalize ownership at TCB 2 ) 0.7 2.2 213% 0.6 0.7 25% 0.9 2.3 170% 0.6 0.7 34% 1. Core NPAT Post-MI excludes net one-time gains (non-core) of VND1,472 billion primarily from the deemed disposal of the Company s interest in Techcombank as a result of the bank s recent equity issuances at a price higher than the Company s carrying value 2. Assume MSN ownership in TCB in 3Q2017 is the same with 3Q2018 3. Core EPS is calculated based on year-to-date ( YTD ) Core NPAT Post-MI as defined in footnote 1 divided by total number of shares (including treasury shares) (3%) net revenue decline due to impact of pig price crisis on MNS topline 3x growth in reported NPAT Post-MI due to net one-time gain from the partial deemed disposal in relation to the Company s shareholding in Techcombank. Excluding this non-recurring benefit, core NPAT Post-MI up by 90% (9% net margin) driven by SG&A rationalization + deleveraging: 350 bps reduction in SG&A as a percentage of net revenues and a 10.5% reduction in interest expense 3Q2018 Performance (3%) decline in net revenue and (1%) decline in core NPAT Post- MI; however, delivered nearly 30% revenue growth of MCH driven by innovations and 6% revenue growth of MSR despite higher copper inventory levels which translated into approximately VND650 billion in missed revenue expected to be recovered in 4Q2018 Growth fundamental intact if excluding one-off impacts: If excluding MNS due to one-time impact of feed market, delivered 20%+ revenue growth and 25% NPAT growth If adjusting TCB ownership 2, delivered 30%+ YoY growth in NPAT inclusive of MNS underperformance 3

MCH Revenue Growth + Operational Efficiency Drove Net Income Growth REVENUE DRIVERS 3.0 0.8 (4.6) 27.5 27.5 22.9 27.5 26.6 9M17 MCH MNS MSR 9M18 30%+ growth in MCH led by premiumization and successful innovations Continued sustainable momentum in 3Q2018 with 20%+ growth Continued strong performance of MSR 30%+ revenue decline in MNS due to pig price crisis. MNS to pick up at feed market recovery in 2019 with 10%+ market growth CORE NPAT POST-MI ON TRACK TO ACHIEVE BUDGET 0.2 1.1 0.1 (0.1) (0.2) 1.2 1.1 1.2 1.2 1.2 1.0 9M17 Revenue Gross Margin SG&A savings Interest expense savings Others 2.3 9M18 SG&A rationalization across businesses: consolidated SG&A as a percentage of net revenue reduced by 350 bps from 19.6% in 9M2017 to 16.1% in 9M2018 as a result of scaling back on total sales spend and savings from sales force optimization Capital allocation: 140bn savings from deleveraging and 90bn savings from consolidating minority interest 4

Continue To Strengthen The Balance Sheet GROSS DEBT BALANCE Total Debt Debt to EBITDA 4.2x 3.7x 3.2x <2.5x 41.1 34.8 34.3 23-25 2016 2017 9M2018 2018 Gross debt to approximately decrease by over VND11 trillion in 4Q2018 Debt / EBITDA end 2018 < 2.5x Interest savings of VND1.0 trillion per year to be fully realized in 2019 onwards and VND0.2 trillion realized in 4Q2018 The Company s deleveraging is part of its effort plans to achieve a credit rating that is on par with Vietnam s long-term sovereign credit rating of BB- within in the next 12 months CASH MOVEMENTS DURING THE PERIOD (2.0) (1.9) 5.3 (1.3) (1.9) (0.6) 11.3 8.1 8.1 9.4 8.1 6.2 5.6 5.6 Strong operation cash flow of VND5.3 trillion Growth CAPEX of VND1.9 trillion for building 3F (Feed-Farm-Food) platform of VND0.8 trillion, maintenance + expansion of MSR and MCH of VND0.8 trillion and VND0.3 trillion, respectively Cash at 2017 Net cash from operating activities Net interest paid CAPEX Dividend paid Net cash from M&A activities Others Cash at 9M18 5

BUSINESS UNITS PERFORMANCE 6

MCH: Sustainable Growth Momentum In Sales + Profitability in 3Q REVENUE OF 3Q2018 30% growth in revenue driven by successful implementation of premiumization strategy in foods and scaling-up the beverage business Maintain healthy stock at distributors with stock level <1 month 8.9 9M2017 11.9 3.4 9M2018 3Q2017 EBITDA EBITDA EBITDA margin 4.4 3Q2018 40% growth in EBITDA driven by pull business model Optimized sales spending: ~7% over sales in 3Q2018 vs. ~9% in 3Q2017 4Q2018 SG&A as percentage of net revenue is expected to be higher versus 9M2018, as management invests in marketing activities for 4Q2018 innovation launches, Tet and to prepare for 2019 growth 17% 26% 25% 27% 3.1 1.6 0.9 1.2 9M2017 9M2018 3Q2017 3Q2018 7

MCH: Successful Innovations in Core Portfolio but More Work To Be Done In Meat and Beer HIGHLIGHTS OF ACTUAL 3Q2018 VERSUS 3Q2017 Seasonings 36% revenue growth (~40% revenue contribution) Noodle 32% revenue growth (~30% revenue contribution) Beverage 38% revenue growth (~15% revenue contribution) Coffee 17% revenue growth (~10% revenue contribution) Meat (28)% revenue decline (~1% revenue contribution) Beer (22)% revenue decline (~2% revenue contribution) Premium product sales growth of 50%+ and contribution of 10% to portfolio 30% growth in volume driven by core brands Nam Ngu, Chin-su Modern trade = strategic channel to win urban Premium product sales growth of 60%+ and contribution of 45% to portfolio 3x run rate of Omachi cup from launch 5 quarters ago Maintaining shares + increasing profit in mainstream and economy segments Energy Drink delivering consistent 60%+ growth since launch driven by both focused brand communication + distribution expansion Beverage POS increasing from 75k last year to 130k+ today Recovery of coffee driven by Vinacafe brand with 25% growth to be positioned as premium brand Upgrading R&D platform to deliver break-through innovations to sustain 15%+ growth Partnership with Jinju provides MCH worldclass innovation and technology processed meat capabilities First co-product to be launched in 4Q2018 and innovation pipeline for 2019 being solidified Revisiting sales strategy focusing on regional winning across the nation, especially in provinces where our brand has found traction Building on-channel as strategic route to market and brand building Set up a separate beer distribution platform led by a dedicated salesforce with significant beer-specific experience 8

MCH: Intensive Innovation Pipeline In 4Q2018 To Support 2019 Growth Momentum KEY INNOVATIONS EXPECTED IN 4Q2018 FOOD PREMIUMNIZATION BEVERAGE EXPANSION Premiumization of processed meat Upgrade consumers in seasonings and noodles Strengthen Vivant mineral water brand Re-launch campaigns for Vinacafe coffee + Energy Drinks Marketing investment of ~VND400 bn in 4Q2018 to support innovation launches (versus VND740 bn in 9M2018) Innovations will support long-term high double digit growth in both revenue and NPAT in 2019 and beyond 9

MNS: Slight Improvement of Pig Feed in 3Q2018 Slightly improvement of pig feed sales in 3Q2018 but still 2 Total Feed Pig feed quarters away from full recovery 2.9 Sales/Salesman (VND bn) 3.9 4.4 REVENUE Operational efficiency to protect profitability with EBITDA of 9.1% during market crisis and increased raw material pricing environment 3.17 3.47 3.33 1.65 1.58 1.61 1Q2018 2Q2018 3Q2018 1Q2018 2Q2018 3Q2018 EBITDA Feed EBITDA EBITDA margin 10.8% 9.0% 9.1% ~2% decreased in EBITDA margin compared with 1Q2018 mainly because of raw materials cost increased by ~9% during 9M2018 offset with Increase salesman efficiency: most importantly during crisis, built lean operation platform and aggressively managed costs to protect profit. This basis will support double digit EBITDA margin in 2019 0.3 0.3 0.3 1Q2018 2Q2018 3Q2018 10

MNS: Expecting 10%+ Growth In Feed Market In 2019 Due to Pig Herding Cycle (VNDk/kg) PIG PRICES South North 39.0 39.3 45.2 43.2 41.7 36.4 36.8 31.8 29.6 25.7 23.8 20.7 30.8 31.1 27.3 29.2 28.3 31.4 43.5 44.2 50.1 52.0 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 Pig feed market takes 6-9 months for full recovery LAG TIME OF FEED MARKET RECOVERY Feed market is expected to grow by 10%+ in 2019 driven by big farmers As a results, our strategy to win feed in 2019 is: Consolidate shares in both tier 1 and tier 2 products Win big farmers with dedicated products (expect 20% contribution to our portfolio) 3 MONTHS sustained pricing for farmers to gain confidence to increase pig herds (2Q2018) 6 MONTHS for sows to produce piglets (3Q + 4Q2018) 3 MONTHS for piglets to grow to porkers. This is the highest feed consumption phase of pig cycle = Market to recover fully in 1Q2019 11

MSR: Healthy Cash Flows Generator REVENUE APT PRICE (USD/mtu) Actual Forecast ~20% revenue growth: (i) high tungsten price environment and (ii) higher price realization by 6% in 9M2018 vs. 9M2017 driven by proven product quality 199 213 258 282 318 336 302 ~300 Improvement in free cash flow + sustained EBITDA margin 3.9 4.7 Operational efficiency: improvement in recovery rate = on track to achieve 70%+ in 4Q 9M2017 9M2018 EBITDA EBITDA EBITDA margin 50.1% 50.4% 2.0 2.4 9M2017 9M2018 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 FREE CASH FLOW ~1.3 1.0 0.6 0.8 2016 2017 2018E 9M2018 Tungsten prices have softened in 3Q2018 due to seasonality factors in Europe and uncertainties in the ongoing USA-China trade war. However, tungsten concentrate market continues to remain tight and very limited supply available globally. With the recent shutdown of an Ex-China tungsten mine, management forecast tungsten prices to trade up to the USD300 per MTU level in 4Q2018 Building MSR as the largest ex-china Tungsten Chemical Producer Consolidated 49% of JV in Aug-2018: immediate financial result = NPAT post-mi margin expected to increase by 1% in 2018 or 7% if annualized Increasing Tungsten Chemicals capacity from 7,500 ton WO3 to 12,000 ton WO3, the platform to double market share 12

TCB: Continuing to Deliver High Double Digit Returns Post IPO TOTAL OPERATING INCOME ( TOI ) 25% growth in TOI: (i) 25% increased in net fee and commission income and (ii) 26% increased in net interest income 60%+ growth in profit leading to double digit ROE 1 of 25% (taking into account new capital issuance earlier this year) 10.6 9M2017 13.3 9M2018 PROFIT BEFORE TAX ( PBT ) On track to deliver PBT target of VND10 trillion for the year Strengthening Balance Sheet: At the end of 9M2018, TCB had a capital adequacy ratio of 14.33%, 2.31% higher than the same period last year thanks to equity growing faster than risk weighted assets. Total loans to large corporates, and small and medium enterprises ( SMEs ) will be approximately the same share as loans to retail customers. The balancing of the loan book between retail customers and businesses aims to reduce credit risk, thereby improving operational efficiency Delivering customer-centric strategy: continue to improve market position on consumer payment solution to meet customers financial and transactional needs and follow the government directive of reducing cash transaction volume in Vietnam. 4.8 9M2017 7.8 9M2018 1. On a last-twelve-month ( LTM ) basis ending 30 September 2018 13

FY2018 Outlook Flat growth in revenue 25% revenue growth 50% EBITDA growth (20) - (30)% revenue growth (50)% EBITDA growth 35-50% revenue growth 20-40% EBITDA growth + On track to deliver target core NPAT Post-MI of VND3.3 3.4 trillion and reported NPAT Post-MI of VND4.7 4.8 trillion 14

Key Takeaways Sustainable 20%+ growth momentum of MCH led by innovations: premiumization of foods + beverage portfolio expansion. More work to be done in Processed Meat + Beer MNS to pick up in 2019: Fresh meat driving long term growth + positive about feed market environment with 10%+ market growth in 2019 MSR having sufficient capacity + technological platform to grow mid-stream Tungsten market share by 2x Continue to build a lean operation platform through discipline SG&A investment + reduced trade promotion Strengthen balance sheet: over VND11,000 trillion debt reduction in 4Q2018 alone leading to Debt/EBITDA below 2.5x by end 2018 TCB to continue delivering20%+ ROE On track to deliver net margin of 10%+ in 2019 onward 15

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