Thai Union Group Public Company Limited · SET:TU
Thai Union Group Public — Thai Union Frozen Products — FY2009 Earnings Presentation
25 slides from Thai Union Group Public's earnings presentation, Feb 16, 2010
Slide 1: Thai Union Frozen Products Analysts Meeting: 2009 Review and 2010 Outlook
Thai Union Frozen Products Analysts Meeting on 2009 Review and 2010 Outlook Bangkok February 16, 2010
Slide 2: Disclaimer
Disclaimer The information contained in our presentation is intended solely for your personal reference only. In addition, such information contains projections and forward-looking statements that reflect our current views with respect to future events and financial performance. These views are base
Slide 3: Highlights
Highlights • 2009 was a year of record-breaking performances for TUF, in terms of net profit, EBITDA and operating cash flows. Without write-downs worth as much as US$16.5 m due to plant relocation, operating results would have been even better • A higher proportion of value-added products, attentiv
Slide 4: Prices under pressure in 2009
Prices under pressure in 2009 1. Selling prices were generally under pressure throughout the year due to uncertain economic prospect and lower commodity / raw material prices, e.g. tuna 2. Thai seafood exports started to rebound in 2H09 Export Value in 2009 US Dollar Seafood Products 2008 2009 % Shr
Slide 5: Record Performance in 2009
Record Performance in 2009 Btm 2009 2008 YoY Sales 68,994 69,048 -0.1% Sales in US dollar term 2,013 2,070 -2.8% Gross Profit 10,444 8,757 +19.3% %sales 15.1% 12.7% Shutdown & Start-up Expenses (US$16.5 m) 568 - %sales 0.8% - Operating Profit 4,132 2,823 +46.4% %sales 6.0% 4.1% Add: FX Gain (Loss) 3
Slide 6: Strong YoY Profit Growth in 4Q09
Strong YoY Profit Growth in 4Q09 Btm 4Q09 4Q08 YoY Sales 17,202 18,410 -6.6% Sales in US dollar term 517 528 -1.9% Gross Profit 2,780 2,152 +29.2% %sales 16.2% 11.7% Shutdown Expenses (US$5.0 m) 169 - %sales 1.0% - Operating Profit 977 465 +110.1% %sales 5.7% 2.5% Add: FX Gain (Loss) 21 (66) -131.8%
Slide 7: Improving Profitability
Improving Profitability 2009 2009 2008 2008 2007 2007 2006 2006 2005 2005 Bt m US$ m Bt m US$ m Bt m US$ m Bt m US$ m Bt m US$ m Sales 68,994 2,013 69,048 2,070 55,507 1,612 55,039 1,457 53,644 1,330 EBITDA 5,926 173 4,265 128 3,829 111 3,927 104 3,775 94 Depr.+Amor. 1,076 31 1,000 30 979 28 853 23
Slide 8: Improving Financial Position
Improving Financial Position -Lower interest-bearing debts thanks to a lower Inventory balance (down by Bt 966 m and Bt 2,826 m from 3Q09 and a year ago respectively) -EBITDA hit a new high at Bt 5,926 m thanks to expanded margins. A lower inventory level further sent operating cash flows (Bt 8,578
Slide 9: 2009 Sales Own Brands vs. OEM & Sales from Thai Operations
2009 Sales Own Brands vs. OEM & Sales from Thai Operations Sales from Thai Operations Alone Own Brand vs. Contract Manufacturing (OEM + Domestic Sales) Overseas Subs. 40% Contract Manufacturing for Export (OEM) (own brands) Europe Africa 0% 49% Middle East 10% USA 23% 5% 11% South 40% America 2% Can
Slide 10: Sustainable Sales From Most Products
Sustainable Sales From Most Products 2009 Consolidated Sales by Product • Group sales -2.8% YoY Shrimp Feed Canned • Sardine sales +39.8% Cephalopod 6% Seafood 3% 9% Sardine / • Shrimp sales +1.0% Mackerel 4% Canned Petfood 9% • Cephalopod sales +10.8% • Other seafood sales +2.5% • Shrimp feed sales
Slide 11: Japan, Africa and Domestic Market Helped Sustain Group Sales
Japan, Africa and Domestic Market Helped Sustain Group Sales 2009 Consolidated Sales by Market • Japan +12.2% • Africa +18.6% Europe Asia Oceania 3% Middle East 2% 13% • Domestic + 11.4% (non-Japan) Africa 2% 6% USA 49% Japan • US -4.0% YoY 12% • EU -12.2% Domestic sales • Oceania -26.2% 11% Canada
Slide 12: Stronger Thai Baht But Manageable
Stronger Thai Baht But Manageable -About 89% of the group’s revenues and 62% of the group’s costs are in US$ in 2009. We manage to keep the cost structure (US vs. Thai baht) steady over time -Given the cost structure of our Thailand operations, weaker Thai baht would normally benefit us. But active
Slide 13: Tuna Raw Material Prices Recovering Since November
Tuna Raw Material Prices Recovering Since November Skipjack Tuna Prices (WPO & EPO) USD / MT 2500 2000 1500 WPO price 1000 EPO price 500 0 Oct Oct Oct Oct Oct Oct Oct Apr Apr Apr Apr Apr Apr Apr Jul Jul Jul Jul Jul Jul Jul Jan '03 Jan '04 Jan '05 Jan '06 Jan '07 Jan '08 Jan '09 • Current WPO tuna pr
Slide 14: Shrimp Prices Stable Upon Export Growth
Shrimp Prices Stable Upon Export Growth White Shrimp Price (60 counts/ kg) THB / KG 200 180 160 140 120 100 80 60 40 20 0 n 3 4 5 6 7 8 9 0 l l l l l l pr pr pr pr pr r n t n t n t n ct n ct n t Ju Ju Ju Ju Ju Ju c c c c p Ja '0 '0 '0 '0 '0 '0 '0 '1 Ja O Ja O Ja O Ja O Ja O Ja O A A A A A A ct O Cur
Slide 15: Flat Sales but Lower Inventory and Debts With Record High EBITDA and Profit
Flat Sales but Lower Level of Inventory and Debts With Record High EBITDA and Profit in 2009 • Record EBITDA and Record Cash Flows boosting TUF’s Financial Strength Record profit, mainly a result of expanded margins, sent EBITDA to a new high (Bt5,926 m), compared with Bt4,265 m in 2008. In addition
Slide 16: Recap on 2009 Events
Recap on 2009 Events • New Joint Venture in India TUF has formed a joint venture with 14.99%-owned Avanti Feed to establish Avanti Thai Aqua Co., Ltd. in Gujarat, India with registered capital of Bt55.44 m. TUF would hold a 50% stake in the venture. The purpose of the joint venture is to build a shr
Slide 17: Recap on 2009 Events
Recap on 2009 Events • Joint Venture in Papau New Guinea (PNG) TUM has officially formed a joint venture with Century Canning Corporation Co., Ltd., and Frabelle Fishing Corporation Co., Ltd. to established Moresby International Holdings that would in turned set up Majestic Seafood Corporation in Pa
Slide 18: Update on US Subsidiaries
Update on US Subsidiaries •Empress International 2009 was a challenging year for any shrimp importer in the US when the food-service sector (the biggest buyer of shrimp) was hard hit by the economic slowdown in the US. Despite this, Empress managed to maintain sales at nearly 2008’s level. More enco
Slide 19: Update on US Subsidiaries
Update on US Subsidiaries •Chicken of the Sea International (COSI) COSI was able to increase its sales slightly in 2009. Generally, sales of tuna and other canned seafood products were quite durable despite poor economic conditions in the US. Earning before the relocation expenses (US$16.5 m) increa
Slide 20: Outlook for 2010
Outlook for 2010 1. Expect annual dollar sales to grow 12% as demand for most of our products should be sustainable given their affordability and nutritional benefits 2. As the economies around the world are improving, buyers should become more optimistic and aggressive in promoting sales. That woul
Slide 21: Strategy in 2010
Strategy in 2010 1. Actively integrate operations between COSI and Thai plants in order to realize cost-savings and strengthen our supply chain ASAP 2. Maintain tight cost and inventory controls and improve plant efficiency to lower per unit cost in order to sustain or further improve margins 3. Exp
Slide 22: US$ 3,000 m in 2012
4-Year (2009-2012) Sales Target Remains Unchanged US$ 3,000 m in 2012 -22-
Slide 23: Expected Dividend for 2H09
Expected Dividend for 2H09 Expected final dividend = Bt1.00 per share XD & Payment dates within March, 2010 Est. dividend for 2010 (interim + final) = Bt1.92 / share Dividend Yield = 5.7% *Based on the share closing price of Bt 33.75 on Feb 12, 2010 -23-
Slide 24: TUF in Euromoney's 2010 Best Asian Companies Poll
TUF in Euromoney’s 2010 Best Asian Companies Poll •TUF was voted among the top three best Asian companies in the Food, Drink and Tobacco category in Euromoney’s annual Best Asian Companies Poll (January 2010 issue) by leading analysts in the region •The annual ranking is based on a survey of market
Slide 25: Q&A
Q&A
Thai Union Frozen Products — FY2009 Earnings Presentation on 6ix