Thai Beverage - CGS-CIMB Research 2023-11-23: FY23 Results A Miss; Beer & Associate FPL The Key Drags

• Thai Beverage (SGX:Y92)’s FY23 (Oct 2022 to Sep 2023) revenue grew 2% y-o-y, while PATMI declined 9% y-o-y. We deem this as below expectations as PATMI formed 92%/93% of our/Bloomberg consensus’ forecast.

Beer & associate FPL were key drags

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• lower share of profits from associate Frasers Property Limited (FPL, SGX:TQ5).
• These two factors overshadowed strength in other business segments in Thailand, which continued to report positive revenue growth in 4QFY23.

Resilient spirits sales

• Sales volume for the spirits segment grew ~3% y-o-y in 4QFY23, narrowing the full-year volume decline to -2% y-o-y (from -3.5% y-o-y in 9M23; 1HFY23 suffered from a high base effect due to trade-inventory loading ahead of price hikes in 1HFY22).
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• Spirits segment EBITDA margin was flattish (+0.1% points y-o-y) in 4QFY23. Thai Beverage is currently working on price hikes of smaller bottle SKUs for brown spirits.
• Thai Beverage also disclosed that it acquired two international spirits distilleries (Cardrona Distillery in New Zealand, Larsen in France) in Sep to strengthen its premium spirits offerings in the international market for a cash consideration of ~US$80m.

Beer sales could remain lacklustre; offset by lower input costs

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ONG Khang Chuen CFA CGS-CIMB Research | Kenneth TAN CGS-CIMB Research | https://www.cgs-cimb.com 2023-11-23 SGinvestors.io

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