- We remain positive on Thai Beverage due to its strong market leadership in Thailand and Vietnam, and being a beneficiary of the economic recovery in both countries. Even though 1Q24 earnings missed estimates, we anticipate consumption recovery in Thailand and Vietnam to come through, delivering earnings growth in the latter part of the year.
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1QFY24 earnings below estimates.
- Thai Beverage (SGX:Y92)'s 1QFY24 revenue came in at THB76bn (-5.9% y-o-y) while EBITDA registered THB14bn (+1.9% y-o-y), below expectations. Revenue was dragged by the beer business (-14% y-o-y, THB33bn) due to slower-than-expected economic recovery in Vietnam and Thailand. Apart from that, spirits revenue rose 0.5% y-o-y to THB34bn on better selling prices, while NAB and Food increased 1.6% and 5.9% y-o-y to THB5bn each on better sales volume and brand visibility, new stores, and promotions.
Higher beer & NAB margin
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- EBITDA margin for the food unit was flat at ~11%. EBITDA margins outperformed, largely due to lower raw material and packaging costs in the beer business, and prudent cost management.
We cut FY24-26F earnings by 2-5%.
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