Sri Trang Agro-Industry Public Co. Ltd. · SET:STA
Sri Trang Agro-Industry Public — Q3 2020 Earnings Presentation
36 slides from Sri Trang Agro-Industry Public's earnings presentation, Nov 16, 2020
Slide 1: 3Q20 Analyst Presentation
STA 3Q20 Analyst Presentation 16 November 2020
Slide 2: Agenda
Agenda 1. Financial Performance 2. STA Business Highlights 3. Natural Rubber Market Situation 2
Slide 3: Financial Performance
1 FINANCIAL PERFORMANCE 3
Slide 4: Rubber Price Movement
Rubber Price Movement 3Q19 4Q19 1Q20 2Q20 3Q20 AVG. of TSR20 134.7 (-11.0%) 137.0 (+1.7%) 133.5 (-2.5%) 110.8 (-17.0%) 128.1 (+15.6%) 152.4 (+19.0%)* 300 280 RSS3 260 TSR20 240 SICOM Price 220 (US cent : Kg.) 200 180 160 140 120 100 Feb-20 Mar-20 Jun-20 Sep-19 Dec-19 Apr-20 Sep-20 Oct-19 Nov-19 Oct-
Slide 5: Latex – Butadiene – Acrylonitrile - Forex
Latex – Butadiene – Acrylonitrile - Forex 3Q19 4Q19 1Q20 2Q20 3Q20 AVG. of BD 118.6 (+13.5%) 101.0 (-14.9%) 83.9 (-8.9%) 64.8 (-22.7%) 71.2 (+9.9%) 80.3 (+12.8%) 220 ACN 139.0 (-35.0%) 146.3 (-9.3%) 87.5 (-40.2%) 37.3 (-55.0%) 58.8 (+57.8%) 85.5. (+45.4%) LTX 128.7 (+11.6%) 111.6 (-13.1%) 105.0 (-5.
Slide 6: Sales Volume
Sales Volume Natural Rubber Products (tons) Glove Products (million pieces) -7.3% +43.9% 818,340 +60.6% 20,769 -10.2% -21.1% 758,981 -4.5% 14,430 272,223 7,414 7,077 239,387 214,873 5,027 3Q19 2Q20 3Q20 9M19 9M20 3Q19 2Q20 3Q20 9M19 9M20 6
Slide 7: Sales Revenue – Gloves Contributed 49% of Total Revenues
Sales Revenue – Gloves Contributed 49% of Total Revenues Sales Revenue by Product (THB million) Sales Breakdown by Product Gloves +8.4% 49,233 49% 38 45,406 34 34% LTX 16,496 9,001 20% 16,875 4% Mil.Baht 4% RSS 1,920 5% TSR 4,905 11% 1,625 3% 42% 3,080 6% +7.2% +8.1% Sales Breakdown by Region 15,384
Slide 8: Gross Profit – Continued Breaking GPM Record
Gross Profit – Continued Breaking GPM Record NR’s Gross Profit (THB million) Glove’s Gross Profit (THB million) Blended Gross Profit (THB million) 3,500 12% 8,000 70% 12,000 40% 3,147 61.7% 7,403 7,000 34.1% 10,553 3,000 60% 35% 9.7% 9.2% 10,000 9% 6,000 2,500 30% 50% 7.4% 43.9% 5,000 4,991 8,000 25
Slide 9: EBIT – Growing Stronger
EBIT – Growing Stronger EBIT (THB million) – 3Q20 EBIT (THB million) – 9M20 EBIT EBIT Share of profit (loss) from investments in associates & JV EBIT margin (%) 24.6% 6,000 35% 9,000 25% 32.2% 5,000 5,306 30% 8,000 8,062 25 147 20% 25% 7,000 4,000 6,000 20% 15% 3,000 5,000 1,548 15% 4,553 4,000 2,00
Slide 10: Net Profit – New Normal of Net Profit
Net Profit – New Normal of Net Profit Net Profit (THB million) – 3Q20 Net Profit (THB million) – 9M20 Net profit (loss) Net profit margin (%) Net profit (loss) Net profit margin (%) 2,500 15% 4,500 12.6% 4,000 13.0% 2,000 12% 3,500 10.0% 3,000 8.2% 1,500 9% 2,500 7.0% 7.2% 2,000 4,032 2,084 4.0% 1,0
Slide 11: Financial Highlight
Financial Highlight (Unit : THB million) 3Q20 3Q19 %YoY 2Q20 %QoQ 9M20 9M19 %YoY FY19 Revenue 16,496 15,384 0.7% 15,256 -12.7% 49,233 45,406 8.4% 60,286 NR Sales volume (tons) 214,873 272,223 -16.1% 239,387 -21.4% 758,981 818,340 -0.4% 1,103,934 NR Avg. selling price (USD per ton) 1,346 1,488 -9.6%
Slide 12: Balance Sheet – Very Strong Financial Status
Balance Sheet – Very Strong Financial Status Asset (THB million) Liability & Equity (THB million) 73,823 73,823 3,292 58,331 18,948 Cash and cash equivalent 58,331 13,723 AP 2,382 AR 4,978 2,529 5,934 989 ST-Debt Inventories 1,207 4,866 13,494 11,049 16,949 Other current assets Other Current Liabili
Slide 13: Special Dividend Payment Thanks to The Strong Financial Result
Special Dividend Payment Thanks to The Strong Financial Result Historical Dividend Payment Dividend per Share Operating Year Dividend Payout Ratio (%) (Baht) 2020 XD Date 26 November 2020 [01 Jan 2020 - 30 Sep 2020] 0.50 19.0 [last day that shareholders are entitled to receive the dividend is 25 201
Slide 14: STA Business Highlights
2 STA Business Highlights | az
Slide 15: About STA: The World's Leading Fully Integrated Natural Rubber Company
About STA: The World’s Leading Fully Integrated Natural Rubber Company Established in 1987 Rubber Plantations Rubber Processing Rubber Gloves Downstream Upstream Midstream 36 NR processing plants in Thailand, 3 locations of glove factories in Thailand 45,000 rai 33 Indonesia and Myanmar 2.8 million
Slide 16: Upstream Operations – Rubber Plantations
Upstream Operations – Rubber Plantations Number of Rubber Trees (2020F) TappingTrees 2.37 25% million trees Immature Trees 75% Estimated Mature Plantations Lomsak - Phetchabun 19 Provinces in Thailand 14,000 12,000 Production (tons) Tapping, trees (RHS) 2,500,000 Lampang Phrae 2,000,000 Sukothai Kal
Slide 17: Midstream Operations – NR Processing
Midstream Operations – NR Processing 63% of total sales Technically Specified 36 processing facilities 100% Utilization Rate (%) revenue in Rubber [TSR] Capacity*: 2.86 mil. tons/annum 6M20 80% 66.9% 69.6% 24 2.10processing facilities 62.0% 66.0% 56.6% 62.8% 66.8% 7% Ribbed TSR Capacity*: mil. tons/
Slide 18: Major Customers in Midstream Business
Major Customers in Midstream Business Global Brands 18
Slide 19: Recovery of NR Consumption
Recovery of NR Consumption -- Some countries already returned to Pre-COVID level CHINA [‘000 tons] EU [‘000 tons] 600 150 120 400 90 200 60 FY19 FY20 30 FY19 FY20 0 0 Jan Feb Mar Apr May Jun Jul Aug Sep Jan Feb Mar Apr May Jun Jul Aug Sep THAILAND [‘000 tons] INDIA [‘000 tons] 80 120 60 90 40 60 20
Slide 20: Strategy for Midstream Operations – NR Processing
Strategy for Midstream Operations – NR Processing Launch mobile application Enhance Acquire “SRITRANG FRIENDS” production efficiency higher market share STA market 22% share of Thailand production in 2019 market share STA 25-30% of Thailand production in 2020 Objective: To buy raw materials from rub
Slide 21: Downstream Operations – Finished Products
Downstream Operations – Finished Products STGT, is a Flagship Company of Sri Trang Group with 56% shares owned by STA STU STGT SDME Established in 1989 7% Global market share 3 locations of glove factories in Thailand in 2019 33 19.9 20.8 bn. pcs.installed capacity per annum bn. pcs. sold in 2019 bn
Slide 22: Our Gloves Products
Our Gloves Products Product Range Various distribution channels Volume breakdown 11% 18% Examination/ OBM Non-Examination Gloves OEM Exhibition Selling Agent 89% 82% Latex Nitrile Retail Business Online FY19 9M20 Powdered Powder-Free Powder-Free Our Brands [OBM] - Comfort 4.8 g - Comfort 5.0 g - Hea
Slide 23: Sales Volume Breakdown by Region
Sales Volume Breakdown by Region 10% 20.8 14.4 bn. pcs. bn.pcs. sold in 6M19 sold in 9M20 EU North America 20% 20% Middle Asia 41% 10% 9% 19.9 Sales Volume in 9M20 +43.9% YoY bn.pcs. sold in FY19 East 4% 5% Africa Product Mix by Volume 4% South America Nitrile 33% 36% 20% Oceania 1% Latex 67% 64% Ac
Slide 24: Global Glove Market Outlook
Global Glove Market Outlook Demand Keeps Growing & Hidden Consumption in Emerging Markets Global Glove Demand Increasing Usage of Hygienic Products in Developing Countries [bn. pcs.] Forecasted Rubber Glove Consumption per Capita in 400 Average growth at 10-12% per annum +20% 360 Developed and Devel
Slide 25: Gloves are Necessity in Our Daily Lives & Widely Use in Various Industries
Gloves are Necessity in Our Daily Lives & Widely Use in Various Industries 25
Slide 26: Gloves Are Still in Shortage
Gloves Are Still in Shortage 26
Slide 27: Price Adjustment Continues
Due to The Accelerated Demand Worldwide, Price Adjustment Continues Lead Time of Product Shipment ASP (THB, USD per 1,000 pcs) Mid 2023 • Backlogs continue to 35 31 extend to Mid 2023 for 30 NBR and 1Q22 for NR gloves. 25 1Q22 • Streamlining production to months 20 16 yield highest output to 15 12 c
Slide 28: Strategic Location for Key Suppliers and Tax Privileges
Strategic Location for Key Suppliers and Tax Privileges 28
Slide 29: Natural Rubber Market Situation
3 NATURAL RUBBER MARKET SITUATION 29
Slide 30: Global NR Situation
Global NR Situation Natural Rubber Demand & Supply (Unit : million tons) Demand (LHS) Supply (LHS) Supply Surplus / (Deficit) (RHS) (Unit : ‘000 tons) 18 1,000 840 16.9 800 15 15.9 16.1 16.4 15.2 15.6 14.8 600 13.8 13.6 14.1 12 13.4 12.7 13.2 12.5 12.2 400 11.4 12.1 331 367 9 14.8 13.9 15.2 15.5 13.
Slide 31: NR Supply
NR Supply 2020F Major Producers NR Productions from Top 10 Producers 2020F global production growth = -5.2% YoY 5,284 -11.0% 2020 Before COVID 4,704 2020 After COVID Others 14% -13.1% 3,244 Thailand 2,819 Malaysia 4% -11.0% 33% 1,257 CAMAL 5% 1,119 +14.4% -8.6% -6.1% 12.98 -12.0% -20.4% -1.6% 824 76
Slide 32: NR Demand
NR Demand 2020F Major NR Consumers NR Consumption from Top 10 Customers -6.5% 2020F global growth in consumption = -11.0% YoY 2020 Before COVID 5,435 5,080 Others 12% 2020 After COVID Malaysia 4% Indonesia 4% China Japan 5% 12.12 42% +16.9% 1,415 mil. tons 1,210 -24.4% 1,190 -15.8% -11.5% -10.6% 1,0
Slide 33: Raw Material Prices in Thailand
20 30 40 50 60 70 80 90 Mar-20 Mar-20 Mar-20 (Unit : Baht/Kg.) Mar-20 Mar-20 Source: The Thai Rubber Association Apr-20 Apr-20 Apr-20 Apr-20 May-20 May-20 May-20 RSS3 @PHYSICAL MARKET May-20 Jun-20 Jun-20 Jun-20 Jun-20 Jun-20 Jul-20 Jul-20 Raw Material Prices in Thailand Jul-20 Jul-20 Aug-20 CUP LUM
Slide 34: Several Storm attacked Main NR Producing Countries
Several Storm attacked Main NR Producing Countries Tropical Storm Noul Typhoon Chan-hom Duration Sep 14 – Sep 19, 2020 Duration Oct 4 – Oct 16, 2020 Peak intensity 85 km/h Peak intensity 130 km/h Area Vietnam & Thailand Area Vietnam & Thailand Severe Tropical Storm Dolphin Tropical Storm Linfa Durat
Slide 35: News Update
News Update Rubber Price Guarantees for Farmers U.S. DEPARTMENT OF COMMERCE INITIATES ANTIDUMPING 60 Baht/Kg. DUTY AND COUNTERVAILING DUTY INVESTIGATIONS OF IMPORTS OF PASSENGER VEHICLE AND LIGHT TRUCK TIRES Period: FROM THE REPUBLIC OF KOREA, TAIWAN, THAILAND, AND RSS3 6 Months THE SOCIALIST REPUBL
Slide 36: Contact Investor Relations
Contact Investor Relations Tel: (+66)2-207-4500 Ext. 1402 E-Mail: IR@sritranggroup.com 36
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