- Following Thai Beverage’s weaker-than-expected FY25 results, we cut our FY26- 27 earnings forecasts by 4% pa. We expect the operating softness to persist.
FY25 review - softness across the segments
- - Read this at SGinvestors.io -
- Spirits revenue slipped 2% y-o-y, caused by a 3% drop in sales volume, while segment profit fell 8% due to elevated SG&A costs. Beer revenue decreased 3% y-o-y amid continued weakness in Vietnam, but segment profit jumped 52% on sharply lower cost of goods sold.
Takeaways from management call
- Management noted a Q4 spirits decline primarily due to geopolitical disruptions at the Thailand-Cambodia border and delayed consumer demand from prior-year overstock. Despite three years of declining spirits volumes, management sees no structural change, attributing the trend to lingering post-COVID economic weakness.
- - Read this at SGinvestors.io -
- In NAB, leadership in key categories is maintained, with local production in Cambodia to support growth.
- Macro factors, including government stimulus and upcoming elections in Thailand, are expected to support consumption, while dividend policy remains at ≥50% of profits.
Limited catalysts keep us at HOLD; target price cut to S$0.43
- Read more at SGinvestors.io.
