COMPANY PRESENTATION – Mar 2020
Forward Looking Statement
2
Statements included or incorporated in these materials that use the words "believe", "anticipate", "estimate", "target", or "hope", or that otherwise relate to objectives, strategies, plans, intentions, beliefs or expectations or that have been constructed as statements as to future performance or events, are "forward-looking statements" within the meaning are not guarantees of future performance and involve risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated at the time the forward-looking statements are made. MINT undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. MINT makes no representation whatsoever about the opinion or statements of any analyst or other third party. MINT does not monitor or control the content of third party opinions or statements and does not endorse or accept any responsibility for the content or the use of any such opinion or statement.
AGENDA
2019 in Review
Minor Hotels
Minor Food
Minor Lifestyle
Corporate Information
2020 & Beyond
2019 IN REVIEW
nhow London
MINT’s 5-Year Performance Recap
5
MINT’s core revenue, EBITDA and NPAT showed a cumulative average growth rate (CAGR) of 25%, 21% and 10% respectively over the last five years.
4,705 4,576 5,415 5,7287,061
THB million
EBITDA Margin
Net Margin
45,678 54,285 58,644 78,499
123,385
9,573 11,256 12,273 15,901
22,634
21.0% 20.7% 20.9%
10.3% 8.4% 9.2%
20.3%
7.3%
5-year CAGR
20192015 20172016 2018(Restated)
18.3%
5.7%
MINT’S FIVE-YEAR PERFORMANCE
25%
21%
10%
23.1x 19.9x 21.3x 17.5x** 14.7x 13.2x
Core Revenue
CoreEBITDA
CoreNPAT
Share price as of 3 Mar 2020
* Share price as at end of the year** 2018 EV was calculated using average quarter-end data to reflect the increase in debt in 4Q18 from the acquisition of NH Hotel Group
EV/EBITDA*
2019 Performance Recap
6
NET PROFIT
In 2019, MINT’s core revenue increased by 57%, primarily from the consolidation of NH Hotel Group (NHH). Core NPAT increased by 23%, driven by both Minor Hotels’ organic operation and the consolidation of NHH.
* 2018 numbers have been restated, as detailed on page 46.** Non-core items are detailed on page 45.
* Excludes non-core items
* Excludes non-core items
2019 REVENUE CONTRIBUTION
2019 NET PROFIT CONTRIBUTION
50,000
75,000
100,000
125,000
150,000 +57%
123,385Minor Lifestyle
4% Minor Food20%
Minor Hotels76%
Minor Lifestyle1%
Minor Food17%
Minor Hotels82%
THB 7,061
million
2018 Reported Revenue
Non-core Previous
+ Adjusted
2018 Core
Revenue
Minor Hotels
Pre-NHH
NHH Minor Food
Minor Lifestyle
2019 Core
Revenue
Non-core Items
2019 Reported Revenue
78,620
-121
78,499 +968
+42,645 +750 +523 +6,504 129,889
REVENUE
THB million
THB 123,385 million
2018 Reported
NPAT
Non-core Previous
+ Adjusted
2018 Core NPAT
Minor Hotels
Pre-NHH
NHH Minor Food
Minor Lifestyle
2019 Core NPAT
Non-core Items
2019 Reported
NPAT
2,000
4,000
6,000
8,000
10,000
12,000
7,061
10,698+23%
4,5085,728 +530
+3,637
+1,220
+1,176
-311 -63
THB million
FX Headwinds & Lease Payment
7
2019 LFL NPAT
MINT’s financial performance was adversely impacted by the strengthening of the Thai Baht and the additional lease payment since July 2019 because of the sale & leaseback transaction of the 3 Tivoli hotels in Lisbon. Excluding both impacts, MINT’s like-for-like (LFL) NPAT would have increased by 32% in 2019.
THB million
0
2,000
4,000
6,000
8,000
2018 Restated
Core NPAT
Minor Hotels Minor Food Minor Lifestyle
Core 2019 NPAT @
Constant FX & excl Lease
FX Impact Leases 2019 Core NPAT
7,543 7,061
+32%
+2,194
-320-266 -113 -1635,728
+23%
International Presence
8
With a solid diversification strategy implemented, MINT’s footprint was in 65 countries at the end of 2019 across its hospitality and restaurant businesses.
*Excludes non-core items
Minor Food
Combination
Minor Hotels
REVENUE CONTRIBUTION
87%
39%27% 29%
13%
61%73% 71%
0%
25%
50%
75%
100%
2008 2018* 2019* 2024F
International
Thailand
2019 Key Milestones
9
MINT has embarked on many initiatives throughout 2019 in order to support growth and strengthen its balance sheet position. This includes Minor Hotels’ integration with NHH, Minor Food’s digital efforts and acquisition of Bonchon, the completion of loan term-out program, as well as asset rotation strategy.
CORPORATEMINOR HOTELS MINOR FOOD
1Q19
2Q19
3Q19
4Q19
• Issued THB debentures of THB 33 billion, of which was partially used to refinance bridge loans for the acquisition of NHH
• Completed the term-out of bridge loans, extending average maturity of debt related to the acquisition of NHH to over 6 years
• Obtained approval from bond holders to exclude TFRS 16 lease liabilities from the definition of “interest bearing debt” in the calculation of debt covenant
• Extended the treatment of perpetual bond as equity to end of 2022 by Federation of Accounting Profession
• Entered into sales & leaseback of 3 Tivoli hotels in Lisbon
• Announced that The Marker Dublin will be the first Anantara city hotel in Europe
• Successfully sold 3 joint-venture hotels in the Maldives: Anantara Veli, Anantara Dhigu and Naladhu Private Island while maintaining the management of the hotels
• Launched 1112 Delivery mobile app in Thailand
• Launched digital loyalty program & delivery service through Uber Eats in Australia
• Actively partnered with third-party aggregators in Thailand
• Launched digital loyalty program in China
• Acquired existing Bonchon outlets in Thailand
• Implemented food traceability project for Riverside brand in China
• Launched the first Anantara in Spain: Anantara Villa Pardierna Palace in Marbella
• Transferred operations of Tivoli in Europe to NHH
MINOR HOTELS
Anantara Desaru Coast
Minor Hotels – Financial Highlights
11
2019 revenue, EBITDA and NPAT of Minor Hotels grew by 86%, 57% and 42% respectively, primarily as a result of the full-year consolidation of NHH. The consolidation resulted in declining margins of Minor Hotels, both at EBITDA and net profit levels, principally from the lower profitability nature of the lease structure of NHH, together with additional financing costs of the acquisition.
* The financials above reflect performance from operation, and therefore exclude non-core items as detailed on page 45.
50,577
94,189
THB million
+86%
Revenue
11,947
18,803
4,077 5,783
+57% +42%
EBITDA NPAT
2018 % Margin2019
23.6% 20.0% 8.1% 6.1%
MINOR HOTELS – FINANCIAL PERFORMANCE
33,966 34,934
THB million
+3%
Revenue
7,704 7,823
3,054 3,584
+2% +17%
EBITDA NPAT
2018 % Margin2019
22.7% 22.4%9.0% 10.3%
ORGANIC MINOR HOTELS – FINANCIAL PERFORMANCE (EXCL NHH)
16,611
59,255
THB million
Revenue
4,243
10,980
1,023
2,199
EBITDA NPAT
2018 % Margin2019
NM 18.5% NM 3.7%
NHH – CONTRIBUTION TO MINTOrganic Minor Hotels Performance
• Revenue & EBITDA increased by 3% and 2% respectively, primarily from mixed-use business
• NPAT increased at a higher rate of 17% from lower depreciation (sale of Tivoli hotels) and interest expenses (lower cost of fund)
NH Hotel Group: 2018 & 2019 not comparable in terms of performance
• NHH 2018 contribution is dividend received in 9M18 & NHH 4Q18 consolidation, net of financing costs
• NHH 2019 performance includes accounting difference adjustment and is net of acquisition related expenses (depreciation & financing cost)
Minor Hotels – International Presence
12
In recent years, MINT has implemented a solid diversification strategy. With the investment in NHH, MINT operates hotels and spas under a combination of owned, leased and management business models in 57 countries.
* Excludes non-core items
Management
Combination
Investment
New Destinations in Pipeline
Hubs
REVENUE CONTRIBUTION
94%
22% 14% 12%
6%
78% 86% 88%
0%
25%
50%
75%
100%
2008 2018* 2019* 2024F
International
Thailand
Owned & Leased Hotels
13
In terms of business model, owned and leased business contribute 86% of Minor Hotels’ revenue. In terms of geography, Europe is the major contributor with 64% of Minor Hotels’ revenue, and 58% of NPAT. Thailand and the Maldives are the second and third largest contributors in terms of NPAT.
SYSTEM-WIDE ROOM CONTRIBUTIONBy Ownership
SYSTEM-WIDE ROOM CONTRIBUTIONBy Geography
2019 REVENUE CONTRIBUTIONBy Business
2019 REVENUE CONTRIBUTIONBy Geography
2019 NPAT CONTRIBUTIONBy Geography
Owned25%
Leased44%
JV 3%
Managed19%
MLR9%
78,360 Rooms
THB 94,189 million
Owned & Leased
86%
Managed1%
MLR6%
Mixed-use7%
Thailand14%
Europe64%
Americas6%
Australia & New Zealand 6%
Maldives & Middle East 3%
Others7%
Thailand18%
Europe58%
Americas2%
Australia & New Zealand 1%
Maldives & Middle East 14%
Others7%
78,360 Rooms
Asia10%
Europe60%
Americas14%
Oceania10%
Middle East & Africa 6%
Owned & Leased Hotels
14
Number of rooms of owned & leased hotel portfolio increased by 2% in 2019. Organic RevPar excluding FX impact grew by 3%, driven by overseas hotel portfolio. System-wide RevPar of owned & leased portfolio declined by 14%, from the dilution of ADR with the consolidation of different room segment of NHH, and the strengthening of the Thai Baht. Revenue of owned & leased hotels grew 112% in 2019, primarily from the full-year consolidation of NHH in 2019 compared to three months consolidation in 2018.
System-wide-16%
Organic excl FX+4%
52,96954,255
2018 2019
No of Rooms
69% 69%71%
2018 2019
+2%
2018 2019
Occupancy
OrganicFlat
System-wide+2%
4,563 4,745 3,846
2018 20192018 2019
ADR (THB)
OPERATIONAL STATS
System-wide-14%
Organic excl FX+3%
3,169 3,277 2,729
2018 20192018 2019
RevPar (THB)
Owned Hotels – Thailand & Maldives
15
The two largest geographies for Minor Hotels outside of Europe are Thailand and the Maldives. While Thailand experienced softer tourist demand amidst the strengthening of the Thai Baht during the year, the Maldives held up well despite the increasing supply.
OPERATIONAL STATS – THAILAND (ORGANIC)
77% 76% 6,307 6,137
2018 2019
4,872 4,663
-1% -3% -4%
-2% -9%
9%
-7% -10%-2% -6%
2019 Bangkok RevPar Growth 2019 Provinces RevPar Growth
1Q 2Q 1Q 2Q3Q 3Q
Flat
Occupancy ADR (THB) RevPar (THB)
4Q4Q
OPERATIONAL STATS – MALDIVES (ORGANIC)
69% 67% 683 712
2018 2019
474 475
-2% +4% Flat
Occupancy ADR (USD) RevPar (USD)
Thailand
• Thailand’s weak performance was primarily from provincial hotels, while Bangkok portfolio held up relatively better.
• Although rates declined in Thai Baht term, the USD rate showed an increase.
Maldives
• Hotels in the Maldives focused on rate increase during 2019, with the successful targeted marketing initiatives.
Owned & Leased Hotels – NH Hotel Group
16
NHH was the largest contributor to owned & leased hotel portfolio in 2019. 2019 RevPar of NHH increased by 5%, driven by all European regions, with Spain being the strongest driver for the year. The increase in RevPar was entirely attributable to ADR, where for the first time exceeded EUR 100, with occupancy remaining stable.
10%
3%4%
2%
-2%
Spain Italy Benelux Central Europe
Latin America
Spain
• Continued recovery in Barcelona from lower leisuredomestic market in 2018
• Excellent performance in Madrid with strong eventscalendar
Italy
• Strong performance of Milan with better trade fair calendarin second half of the year
• Good performance of Rome
Benelux
• Continued recovery in Brussels in 2018 and 2019
• Good performance of Amsterdam and congress centerhotels
Central Europe
• Good performance of Hamburg, German secondary citiesand Austria
• Frankfurt and Munich affected by negative trade faircalendar and higher supply in Frankfurt
Latin America
• RevPar declined mainly from ADR due to negative currencyevolution
Spain 29%
Italy18%
Benelux 23%
Central Europe
23%
America7%
OPERATIONAL STATS – NH HOTEL GROUP (ORGANIC)
72% 72% 98 102
2018 2019
70 74
+0.4% +4% +5%
Occupancy ADR (EUR) RevPar (EUR)
2019 Organic RevPar Growth2019 Revenue Contribution
Note: NHH’s organic stats disclosed by MINT and are different than NHH’s public disclosure as MINT’s version is organic (one-year in operation) whereas NHH’s is LFL (24 months full cycle of operations)
KEY HIGHLIGHTS
NH Hotel Group – Financial Highlights
17
NHH reported recurring EBITDA of EUR 294 million and recurring NPAT of EUR 113 million in 2019, above its full-year guidance of EUR 285 million and EUR 100 million respectively (excluding IFRS 16 and IAS 29 accounting impacts and Tivoli integration).
1,620 1,718
EUR million
+6%
Revenue
263 294
70
113
+12% +63%
Recurring EBITDA Recurring NPAT
2018 % Margin2019
16.3% 17.1% 4.3% 6.6%
NHH – FINANCIAL PERFORMANCE
102 100
-2%
Reported NPAT
Notes: (1) As per NHH’s report, the numbers include hyperinflation accounting effect (IAS 29) (implemented since 3Q 2018) but excludes IFRS 16, (2) 2018 restated due to IAS 29 reclassification between financial expenses and equity(3) Recurring NPAT exclude mainly net capital gains from asset rotation, redundancy payments and accelerated depreciation due to refurbishments.
• Revenue growth of 6%, from organic RevPar growth, new hotel openings and Tivoli portfolio
• Recurring EBITDA growth of 12%, with margin improvement of 0.8% p.p., from effective cost control, resulting in 31% EBITDA conversion rate
• Recurring NPAT increase of 63% from business improvement and lower interest expense (full redemption of convertible bond in June 2018 and partial early redemption of 2023 bond in 4Q18) and lower corporate income tax
• Including non-recurring items, reported NPAT decreased by 2% in 2019, reflecting the lower contribution of –EUR 45 million of non-recurring activities compared to 2018.
• Net financial debt position of EUR 179 million
NHH Integration & Synergies Update
18
Integration with NHH has become an on-going medium term-plan. Potential synergies have been identified and are being worked on by both MINT and NHH. In addition to the sales & lease back transaction of the 3 Tivoli hotels in Lisbon and the transfer of Tivoli portfolio in Europe to NHH in mid-2019, both NHH and MINT have embarked on further cross brand global expansion.
OPPORTUNITIES
• Cross-selling between Asia & Europe & loyalty interface
• Rebranding / cross brand global expansion
• Price improvement with partners & suppliers through economies of scale
• Talent & learning development / workforce mobility
BOSCOLO PORTFOLIO IN EUROPE
NHH agreed with Covivio to operate 8 luxury & high-end hotels in Europe
• Prime locations in Rome, Florence, Venice, Nice, Prague and Budapest
• To be rebranded to Anantara & NH Collection following extensive renovation by Covivio(property owner)
• Lease tenure of 15 years, extendable at NHH option for not less than additional 15 years
• Sustainable variable lease contract with minimum guarantee and basket of losses
• Closing expected in 2Q20
NH COLLECTION IN THE MIDDLE EAST
Minor Hotels signed a management contract in Doha, Qatar
• The first NH Collection to be introduced in the Middle East
• The first hotel outside of the brand’s traditional areas of operation in Europe and Latin America
Asset-Light Businesses
19
MINT’s asset light businesses include management letting rights (MLR) of serviced-suites primarily under the Oaks brand in Australia and New Zealand, together with the hotel management contracts under Minor Hotels’ brands.
MANAGEMENT LETTING RIGHTS
141 136
2018 2019
3,391 2,937
+1% -4% -13%
No of Rooms RevPar (AUD) RevPar (THB)
7,043 7,147
• RevPar of MLR in AUD declined primarily from lower occupancy amidst weak macro environment.
• RevPar in THB declined further by 13% in 2019 from the strengthening of the THB against AUD.
• As a result, MLR revenue in THB term declined by 9% in 2019.
MANAGED HOTELS
13,31115,129
No of Rooms
+14%System-wide
-16%Organic excl FX
+4%
3,361 3,488 2,823
2018 20192018 2019
RevPar (THB)
• Organic RevPar of managed hotels excluding FX impact increased by 4% in 2019, driven by hotels in the Middle East.
• System-wide RevPar declined by 16%, from the consolidation of NHH’s managed portfolio which has lower ADR, together with the strengthening of the Thai Baht.
• Management income in 2019 decreased by 4% primarily from the high base of the technical and termination fees received in 4Q18.
Hotel Expansion Pipeline – 73 Hotels; 14,357 Rooms
• Ubud, Bali, Indonesia* 71 rms• Khao Lak, Thailand 328 rms• Hannover, Germany 89 rms• Amsterdam, Netherlands 650 rms• Warangi, Serengeti
National Park, Tanzania* 12 rms• Venice, Italy 100 rms• Venice, Italy 64 rms• Florence, Italy 86 rms• Budapest, Hungary 138 rms• Prague, Czech Republic 152 rms• Rome, Italy 238 rms• Budapest, Hungary 185 rms• Nice, France 152 rms
MA
NA
GED
/ M
LRS
• Frankfurt, Germany 428 rms• Monterrey, Mexico 120 rms• Cagliari, Italy 100 rms• Frankfurt, Germany 375 rms
OW
NED
& L
EASE
D
49 Hotels / 10,060 Rooms
• Libo Country, China 173 rms• Nanjing, China 120 rms
• Ras Al Khaimah, UAE 174 rms
• Busan, Korea 570 rms• Ras Al Khaimah, UAE 225 rms• Nairobi, Kenya 120 rms
• Fortaleza, Brazil 130 rms• Hangzhou, China 166 rms
• Phuket, Thailand 500 rms
• Chengdu, China 202 rms
• Lima, Peru 164 rms• Iquique, Chile 135 rms
• Lima, Peru 265 rms• Santiago, Chile 146 rms
• Hangzhou, China 54 rms
• Phi Phi Island, Thailand 107 rms• Chengdu, China 150 rms• Sharjah, UAE 233 rms• Jeddah, Saudi Arabia 328 rms
• Savanne, Mauritius 156 rms• Sifah, Oman 300 rms• Kota Kinabalu, Malaysia 386 rms• Cam Ranh, Vietnam 595 rms• Ho Chi Minh City, Vietnam 217 rms
• Guadalajara, Mexico 120 rms• Aguascalientes, Mexico 105 rms• Mexico City, Mexico 144 rms• Panama, Panama 83 rms
• Zhuhai, China 100 rmsOthers
24 Hotels / 4,297 Rooms
• Bang Krachao, Thailand 62 rms• Krabi, Thailand 83 rms• Nha Trang, Vietnam 273 rms• Dubai, UAE 527 rms• Muscat, Oman 162 rms• Chengdu, China 201 rms• Bahia, Brazil 50 rms
• Toowoomba, Australia 50 rms
• Cairns Esplanade, Australia 60 rms
• Hangzhou, China 132 rms
• Murano, Italy 104+38 rms
• Doha, Qatar 228 rms
• Feira de Santana, Brazil 207 rms
• Fares Island, Maldives* 200 rms• Milan, Italy 185 rms• Santander, Spain 64 rms• Alicante, Spain 63 rms• Milan, Italy 100 rms• Hamburg, Germany 261 rms• Hamburg, Germany 136 rms
• Accra, Ghana 155 rms• Riyadh, Saudi Arabia 163 rms• Yangon, Myanmar 250 rms• Phan Thiet, Vietnam 516 rms• Ho Tram, Vietnam 410 rms
• Yangon, Myanmar 221 rms
BoscoloPortfolio
Others
* Note: Joint-ventured properties
2020F 2021F 2022F 2023F
13 Hotels / 2,265 Rooms 7 Hotels / 1,009 Rooms 4 Hotels / 1,023 Rooms
14 Hotels / 2,177 Rooms 15 Hotels / 3,144 Rooms 14 Hotels / 3,024 Rooms 6 Hotels / 1,715 Rooms
20
Mixed-Use Business
Mixed-use business comprises residential development and Anantara Vacation Club. In addition to the current projects, MINT has a pipeline of branded residences for sale in order to ensure the continuity of revenue stream in the coming years. Anantara Vacation Club provides stable revenue growth driven by membership growth. In 2019, mixed-use revenue increased by 31%, from strong contributions of both real estates activities and Anantara Vacation Club.
21
INVENTORY TO ACCOMMODATE GROWING MEMBERS
229 239
2018 2019 2024F
No of Units
QueenstownBali
SanyaSamuiPhuket
BangkokChiang Mai
>350
GROWING MEMBERSHIP
PIPELINE
CURRENT PROJECTS
Layan Residences by Anantara, Phuket
Avadina Hills by Anantara, Phuket
Anantara Chiang Mai Serviced Suites
Torres Rani, Maputo
15 luxury pool villas
16 luxury pool villas
44 units in 7-storey condominium building
181 keys for rent & 6 penthouses for sale; 21-storey office tower
100%-owned
50% JV
50% JV
49% JV
Anantara DesaruResidences, Malaysia
Anantara UbudResidences, Indonesia
Silom Office
20 residential villas
15 residential villas
60% JV
50% JV
40% JVNA
Launched 2015
Launched 2018
Launched 2016
Launched 2015
To launch 2020
To launch 2023
To launch 2020
RESIDENTIAL DEVELOPMENT ANANTARA VACATION CLUB
12,34714,535
2018 2019
+18%
No of Members
China39%
Thailand11%
Singapore8%
Hong Kong8%
Malaysia7%
Others27%
+4%
No of Units
MINOR FOOD
Minor Food – Financial Highlights
23
2019 revenue of Minor Food grew by 3%, primarily because of the outlet expansion, which offset the slowdown of the overall same-store-sales from the weak macro backdrop. EBITDA declined by 3% from lower operating leverage with the contraction of same-store-sales. Net profit declined further by 20% with investment and expenses in growing sales and strengthening of digital capabilities in Thailand. Nevertheless, Minor Food’s performance has improved significantly especially in 4Q19, with NPAT decline of 5% y-y.
* The financials above reflect performance from operation, and therefore exclude non-core items as detailed on page 45.
23,484 24,233
THB million
+3%
Revenue
FINANCIAL PERFORMANCE
3,647 3,527
1,521 1,210
-3% -20%
EBITDA NPAT
2018 % Margin2019
15.5% 14.6% 6.5% 5.0%
OPERATIONAL STATS
-3.3% -3.0%
0.2%
5.0%
2,270 2,377
No of Outlets SSSG TSSG
2018 2019
+5%
-4.0% -3.6% -3.7%
-0.8%
5.3%3.8% 3.7%
7.3%
1Q19 2Q19 3Q19 4Q19
TSSG
SSSG
• Same-Store-Sales: SSSG, although remained negative, showed an improving trend in 2019, especially in 4Q19. Thailand and Australia hubs were the key drivers.
• Outlet expansion: Network growth of 5% was a result of expansion primarily in Thailand and China.
• Total-System-Sales: As a result of outlet expansion and the acquisition of Bonchon, TSS expanded by 5.0% in 2019.
Minor Food – International Presence
24
MINT operates three restaurant hubs: Thailand, China and Australia. MINT’s restaurant presence is now in 26 countries across the region, operating owned and franchised business models. MINT continues to look for opportunities to expand, especially in these existing markets.
Hubs
Franchised
Combination
Owned
* Excludes non-core items
REVENUE CONTRIBUTION
81%65% 65% 64%
19%35% 35% 36%
0%
25%
50%
75%
100%
2008 2018* 2019* 2024F
International
Thailand
Minor Food Portfolio
25
Minor Food operates outlets that are 50% owned and 50% franchised, while owned outlets is the majority revenue contributor. In terms of geography, Thailand continues to be the most important market, followed by China and Australia hubs.
SYSTEM-WIDE OUTLET CONTRIBUTIONBy Ownership
2019 REVENUE CONTRIBUTIONBy Business
SYSTEM-WIDE OUTLET CONTRIBUTIONBy Geography
2019 REVENUE CONTRIBUTIONBy Geography
2019 NPAT CONTRIBUTIONBy Geography
Thailand 65%
Australia11%
China14%
Others10%
Thailand 78%
Australia11%
China11%
Thailand 74%
Australia16%
China4%
Others6%
2,377 Outlets
Owned50%
Franchised50%
Owned93%
Franchised7%
2,377 Outlets
THB 24,233 million
Operational Stats by Hub
26
The momentum of same-store-sales and total-system-sales growth improved in China and Australia in 2019, compared to 2018. For quarterly performance, Thailand and Australia hubs demonstrated improving trends throughout the four quarters, thanks to the continued focus on product innovations and brand revitalization, together with digital and delivery initiatives.
THAILAND CHINA AUSTRALIA
-3.1% -4.4%
5.4%2.7%
SSSG TSSG
2018 2019
-10%
-5%
0%
5%
10%
1Q19 2Q19 3Q19 4Q19
-5.9%
0.1%4.4%
14.7%
2018 2019
-10%
0%
10%
20%
30%
1Q19 2Q19 3Q19 4Q19
-2.6% -1.3%
-13.3%
-1.2%
2018 2019
SSSG
TSSG
SSSG
TSSG
-5%
0%
5%
1Q19 2Q19 3Q19 4Q19
SSSG TSSG SSSG TSSG
SSSG
TSSG
Bonchon Acquisition
27
With the completion of the acquisition of Bonchon, Minor Food now has the right to operate and expand Bonchon operations in Thailand. Bonchonwill be an important growth driver for Minor Food going forward.
TRANSACTION RECAP
Chicken Time
Spoonful SG
Spoonful TH
Nov 2019
Mar 2020
Minor Food’s Effective
Shareholding
100%
70%
70%
Operator of 42 existing Bonchon outlets in Thailand
Master franchise rights holder of Bonchon in Thailand
Operator of future Bonchon expansion in Thailand
THB 2,000 million
Investment Amount
THB 2,483 million
Entity
• Total investment for Bonchon Thailand is THB 4.5 billion.
• With the completion of the acquisition, MINT has effectively become theexclusive Bonchon master franchise licensee in the country with long-termexclusive territorial rights and ability to expand and sub-franchise.
• MINT reiterates that the entire acquisition is within the average transactioncomparables and trading comparables of F&B companies between 10 – 13xEV/EBITDA 2019.
INVESTMENT RATIONALES
7 3 4 4
24
10 6 9
2008 2018
Chicken
5284
111
2013 2018 2021F
10% CAGR over 5 years
10% CAGR over 3 years
Source: Euromonitor & company estimate
Burger Pizza Ice Cream
46 outlets* today
150 outlets in 5 years
Market SizeTHB
billion
Market Size THB
billion
Source: Euromonitor & company estimate
Sizable & High Growth Concept
High Growth Potential of Delivery Market
Significant Expansion Opportunities
Superior Performance & Scalability
• Bonchon’s best-in-class operational matrix, with lessthan one year payback period and superior store EBITDAmargin
• Ability to accelerate growth, leveraging on Minor Food’soperating platform; outlet and delivery
* 42 outlets operated by Chicken Time, and 4 operated by MINT’s airport operations
MINOR LIFESTYLE
4,439
4,962
Minor Lifestyle
29
2019 revenue of Minor Lifestyle was up 12%, driven by retail trading business. EBITDA declined by 1% because of the lower margin sales with discounts and promotional campaigns of retail trading business, and lower operating leverage of the contract manufacturing business. NPAT declined by 48% because of higher depreciation and taxes.
THB million
+12%
Revenue
FINANCIAL PERFORMANCE
307 304 130
67
-1% -48%
EBITDA NPAT
2018 % Margin2019
6.9% 6.1%2.9% 1.4%
Retail Trading
81%
Contract Manufacturing
19%
• Retail trading: revenue increased by 17%, from Anello, OVS, Radley, Bossini, Charles & Keith Bodum, Henckels and Joseph Joseph.
• Contract manufacturing: revenue decreased by 5%, because of the slow retail environment.
OPERATIONAL STATS
-3.9%
5.6%9.0%
15.4%490 485
No of Shops SSSG TSSG
2018 2019
TSSG
SSSG
-1.3%1.3%
6.1%
14.9%
8.0%11.4%
20.1%21.7%
1Q19 2Q19 3Q19 4Q191Q19 2Q19 3Q19 4Q19
CORPORATE INFORMATION
Oaks Wellington
CAPEX & Balance Sheet Strength
31
CAPEX plans includes maintenance, renovations and signed pipeline. Renovation and pipeline investments will allow MINT to grow above market. With the successful asset rotation strategy, together with 2019 net profit contribution, interest bearing debt to equity ratio declined to MINT’s internal policy of 1.3x. MINT and its senior unsecured debentures have “A” rating by TRIS. Going forward, source of fund for the CAPEX deployment will primarily be internal cash flow.
EBITDA coverage on CAPEX
Minor Food Minor Hotels Minor Lifestyle
1.15
1.31
0.8
1.0
1.2
1.4
1.6
2015 2016 2017 2018 2019
Interest Bearing Debt to Equity Net Interest Bearing Debt to Equity
Internal Policy
X
CAPEX PLANS LEVERAGE
BACK-UP FINANCING
THB million
0
50,000
100,000
150,000
200,000
Outstanding Borrowing & Equity Un-Utilized Facility
Debt38,451
Debt112,373
Note: Cash on hand as at end of 2019 is THB 13,331 million
Equity*9,927
* Assume 100% conversion of MINT-W6
Equity85,8680.0
1.0
2.0
3.0
4.0
5.0
6.0
0
5,000
10,000
15,000
20,000
2019 2020F 2021F 2022F 2023F 2024F
THB million X
2020 & BEYOND
MINT’s Five-Year Strategy 2019-2024
33
Vision
Core Values
To be a leader in delivering exceptional experiences that anticipate and satisfy customers’ aspirations and positively impact stakeholders.
Customer-Focused Result-Oriented People Development Innovative Partnership
Financial Aspiration
Core Revenue Growth > 8% CAGR
Core NPAT Growth 15-20% CAGR
Core ROIC 11% Premium to 1Q of SET50 Multiple
Non-Financial Aspirations
Industry Leader Employer of Choice Sustainable Business
DifferentiatorsInternational Player
Diversified Portfolio Balance
Financial Discipline
Intellectual Property
New Innovative Initiatives & Acquisition
Strategic Pillars
Winning Brand Portfolio
Value Capture & Productivity
Investments, Partnerships & Acquisitions
Innovation & Digital
Empowered People & Teams
Sustainability Framework
1 2 3 4 5 6
MINT’s Five-Year Strategy 2019-2024 – Strategic Pillars
34
Winning Brand Portfolio
• Cross-Brand Expansion
• Brand Revitalization
• New Concepts
1
Winning Brand Portfolio
• Cross-Brand Expansion
• Brand Revitalization
• New Concepts
1
Investments, Partnerships & Acquisitions
• Opportunistic
• Portfolio expansion & development
1
Winning Brand Portfolio
• Cross-brand expansion
• Brand revitalization
• New concepts
1
Value Capture & Productivity
• Minor Hotels /NHH integration
• Asset rotation strategy
• Back-office transformation
2 3
Winning Brand Portfolio
• Cross-Brand Expansion
• Brand Revitalization
• New Concepts
1
Winning Brand Portfolio
• Cross-Brand Expansion
• Brand Revitalization
• New Concepts
1
Sustainability Framework
• Commitment to sustainability
• Strong corporate governance
1
Innovation & Digital
• Digital transformation
• Loyalty & delivery
• Data analytics
• Product innovation
4
Empowered People & Teams
• Leadership streamlining
• New way of work / new office
• New capabilities
5 6
Commitment to Maximize Return and Minimize Risk
35
MAXIMIZE STAKEHOLDER RETURN
• Continue to drive growth from organic and inorganic operations
• Maintain valuation premium to peers and top quartile of SET50
• Build a purpose led, agile, healthy and future ready workplace and workforce
• Elevate the capabilities and well-being of our people and communities, the sustainability of our value chain and the protection of our planet
MINIMIZE STAKEHOLDER RISK
• Diversify portfolio to reduce the volatility of revenue and earnings, especially in difficult years
• Maintain solid balance sheet and cash flows through financial discipline
• Strengthen organization by maintaining and building management depth and preparing solid bench strength through succession planning
• Ensure risk management policy and procedure is in place and being followed by all business units periodically evaluate all associated risk factors and effectiveness of risk mitigation
Today’s Priority #1 – Transformation into an Agile Company
Group CEO MINTDillip Rajakarier
ChairmanWilliam E. Heinecke
BUSINESS & RESULTS
CEO Minor HotelsDillip Rajakarier
CEO Minor FoodPaul Kenny
CEO Minor LifestyleJames Amatavivadhana
CEO NH Hotel GroupRamón Aragonés
GROWTH
Chief Financial OfficerBrian Delaney
Executive Managing Director of Finance & Administration NH Hotel GroupBeatriz Puente
Chief Commercial OfficerStephen Chojnacki
Chief Investment OfficerKosin Chantikul
TRANSFORMATION
Chief Information OfficerSteve Herndon
Chief Strategy OfficerChaiyapat Paitoon
Chief Sustainability OfficerJohn Heinecke
Chief People OfficerKulshaan Singh
With today’s world changing rapidly, MINT has restructured its organization and formulated a Management Committee with the objective to maintain competitiveness and sustainable success.
Financial commitments, operational effectiveness and team motivation
Opportunities to grow beyond financial commitments and plans, long-term shareholder value creation
Relevance and leadership in a disruptive world while creating a competitive advantage.
36
Today’s Priority #2 – Synergies Through Business Integration
37
NH HOTEL GROUP BONCHON
• Cross-selling & loyalty program
• Cross-brand expansion
• Negotiations with suppliers & business partners
• People mobility
• Expansion of the Bonchon’s delivery service through Minor Food’s platform, whether in terms of cloud kitchen or delivery channels, including apps and call centers
• Leverage on Minor Food’s supply chain, not only for cost efficiency but also on quality, consistency and availability
• Leverage on Minor food’s network team for store expansion
MINT continues to look for synergies, with new acquisitions, and across existing business units, to improve its overall performance.
CROSS-BUSINESSES
• Working on global business solutions – operating systems and structures to accommodate the global operation
• Evaluate technologies such as blockchain for procure-to-pay process, first with Minor Food domestic suppliers and then expand to other businesses
• Studying opportunities for group-wide data management.
• Opportunities for innovations and digital disruptions.
Today’s Priority #3 – Minor Food’s Transformation
38
ORGANIZATIONAL TRANSFORMATION DIGITAL TRANSFORMATION OPERATIONAL IMPROVEMENT
Senior Management Positions
Minor Food is making changes to key senior positions, including C-Level Suites.
Collaboration for Customer-Centric Culture
• Objective is to realize synergies across brands, hubs, levels and function
• Minor Food will make investments to allow people to connect, communicate and operate from anywhere.
Digital Team
• The team has been set up
• Key positions have been filled
Digital Roadmap has been formulated:
Delivery Platform being strengthened:
Brand Revitalization
Store Optimization
• Down size / right size• Brand co-location / co-cloud kitchen• New store format
-
In response to the changing business landscape, Minor Food is going through a transformation, not only on the digital front, but organization-wide.
Data Analytics
Personalized Marketing
Reward & Loyalty
Program
Owned app Third-party aggregators
+
Ex: Sizzler as a healthy brand
Ex: Sizzler To Go
Today’s Priority #4 – Portfolio Reevaluation to Maximize Return
39
Business Expansion
Acquisitions
Portfolio Streamlining
Divestments
Asset Rotation
535 hotels in 2019
> 750 hotels in 2024
2,377 outlets in 2019
> 3,700 outlets in 2024
485 points of sale in 2019
> 560 points of sale in 2024
• Minor Hotels acquired NH Hotel Group
• Minor Food acquired Bonchon
• Minor Lifestyle acquired Scomadi
In the process of restructuring shareholding in BreadTalk to focus on long-term growth potential
• Minor Food divested Ribs & Rumps in Australia and Grab Food in the UK
• Minor Lifestyle divested Save My Bag
• Sale & leaseback of Tivolihotels in Lisbon
• Sale of hotels in the Maldives
MINT consistently evaluates its portfolio in order to maximize the overall returns. These are some of the recent examples from which MINT will realize the benefits over the next few years.
Return Maximization
Today’s Priority #5 – Balance Sheet Management
40
Long Term Loans41%
Corporate Bonds43%
Perpetual Bonds16%
Fixed49%
Float51%
AUD6%
EUR64%
THB19%
USD9%
Others2%
AUD7% RMB
3%
EUR49%
THB27%
USD2%
Others12%
As MINT grows, it ensures its growth is balanced with the quality of its balance sheet. Apart from compliance of debt covenants, MINT ensures debt quality in terms of maturity profile, as well as optimal cost of funds. MINT has also implemented natural hedging policy for its currencies exposure to the extent possible.
BALANCE SHEET POSITION CAPITAL STRUCTURE OPTIMIZATION CURRENCY MANAGEMENT
D/E Ratio
• MINT will maintain D/E ratio within:
‒ Financial covenant 1.75x
‒ Internal policy 1.3x
• Approvals have been obtained from creditors and bondholders to exclude lease liabilities from the definition of interest bearing debt.
• Perpetual bonds will be treated as equity until end of 2022 as per the ruling of The Federation of Accounting Professions.
Debt Mix
Interest Rate Mix & Trend
2.0
3.0
4.0
1Q17 3Q17 1Q18 3Q18 1Q19 3Q19
%
Interest rate has come down to less than 3%
Debt by Currency
Revenue by Currency
Five-Year Aspiration
41
2013REVENUE THB 37 bn
2019
REVENUE THB 123 bn
2024
2024F• > 750 hotels• > 250 residences built• > 350 vacation club units• > 3,700 restaurants• > 560 retail shops & POS
(>32,000 sq.m.)
2009• 30 hotels• 1,112 restaurants• 292 retail shops & POS
(14,275 sq.m.)
2019• 535 hotels• 132 residences built to date• 239 vacation club units• 2,377 restaurants• 485 retail shops & POS
(31,398 sq.m.)
2020 Issues – COVID-19
42
MINT is closely monitoring the COVID-19 situation, with the primary objective to ensure the safety of guests, customers and team members. MINT believes the impact will be temporary, and will yet again be able to maneuver through the challenge and emerge as a stronger company, as it has done in the past.
MINOR HOTELS MINOR FOOD
Revenue Maximization
• Minimize cancellations by allowing for postponement of bookings.
• Promote domestic travels in countries that are impacted by COVID-19. The biggest impact today continues to be Thailand.
• Drive revenue in less impacted regions.
Cost Savings Initiatives
• Labor cost control: such as adjustment to back-of-house hours to ensure quality of services, leave without pay options, deferred partial salary payment of senior executives.
• Proactive discussion with suppliers on cost reduction possibilities.
• Cost savings are being implemented across properties and across geographies, while maintaining readiness for the recovery.
Thailand
Revenue Initiatives
• Focus on delivery business by adjusting delivery hours in key areas.
Cost Savings Initiatives
• Proactive supply chain management for efficient sourcing; negotiating for better payment terms with suppliers.
• Reevaluate store openings especially in tourist areas.
• Rental relief negotiation with landlords.
China
Revenue Initiatives
• Focused on delivery in February, as over 50% of the stores were closed.
• Most of the outlets reopened in the beginning of March.
Strict Cost Control
• Food costs: tight control on planning, ordering and waste control.
• Minimize labor costs, such as implementation of temporary redundancy according to the government directions.
• Rental relief by landlords.
With its footprint spanning across the globe, MINT is well-positioned to capitalize on the eventual rebound of the business.
2020 Issues – TFRS 16 Impact
43
MINT adopted TFRS 16 on 1 January 2020, where operating leases is brought on-balance sheet, impacting MINT’s balance sheet and P&L. MINT is adopting modified retrospective method. Note that this is only change in accounting treatment, with no impact on MINT’s business fundamentals or the ability to generate cashflows.
MINT’s Lease Contracts
NHH’s Lease Contracts
Present value of future lease assets discounted back to start
date of contract
Present value of future lease assets discounted back to
acquisition date
Present value of future operating lease liabilities back
to initial application date
Present value of future operating lease liabilities back
to initial application date
ASSETS LIABILITIES EQUITY
THB 80 billion* THB 83 billion* THB 3 billion*Balance Sheet
Impact 1 Jan 2020
2020F P&L Impact
(Before Taxes)
Foregone rental expenses
Higher depreciation & higher interest expenses
EBITDA
Profit before taxTHB 1.7 billion*
* Numbers are preliminary estimates using information as of the end of 2019, and are subject to with the change in lease portfolio.
Note: Negative impact on P&L from the current lease portfolio will be reduced progressively in the coming periods.
Rental Expenses
Depreciation
Interest
APPENDIX
Anantara Golden Triangle Elephant Camp
Non-Core Items
45
Period Amount (THB million) Business Unit Non-recurring Items
4Q19
1,350 revenue
935 net profitMinor Hotels Gain from Maldives asset sales
131 revenue
55 net profitMinor Hotels Non-recurring items of NH Hotel Group
-131 Minor Hotels Foreign exchange loss on unmatched USD Cross-Currency Swap
3Q19
4,743 revenue3,512 net profit
Minor Hotels Gain from Tivoli asset sales
35 revenue-1 net profit
Minor Hotels Non-recurring revenue and expenses of NH
-46 Minor Hotels Foreign exchange loss on unmatched USD Cross-Currency Swap
-322Minor Hotels /
Minor FoodExpenses and provisions related to Corbin & King, Ribs & Rumps, certain brands in Singapore hub
2Q19
-48 pre-tax-38 post-tax
Minor Hotels /Minor Food / Minor Lifestyle
Loss from retirement benefit
62 revenue44 net profit
Minor Hotels Capital gain from asset rotation of NH Hotel Group
-320 Minor Hotels Foreign exchange loss on unmatched USD Cross-Currency Swap
1Q19
50 Minor Food Gain from the divestment of Bread Talk Thailand
132 pre-tax91 post-tax
Minor Hotels Capital gain from asset rotation of NH Hotel Group
-191 Minor Hotels Foreign exchange loss on unmatched USD Cross-Currency Swap
4Q18
708 Reported in 4Q180 Restated
Minor Hotels Gain on fair value adjustment of investment in NH Hotel Group
-800 Minor Hotels Loss from changing status of investment in NH Hotel Group
-96 Minor Hotels Impairment charge of investment in Oaks Gladstone
-280 pre-tax-232 post-tax
Minor Hotels Impairment of investment in Rani (Mozambique)
-125 Minor Food Impairment of investment in GrabThai in UK
-87 Minor Hotels Foreign exchange loss on unmatched USD Cross-Currency Swap
2Q18 121 Minor Food Gain on fair value adjustment of investment in Benihana
2018 Restatement
46
NET PROFIT
2018 revenue and NPAT have been restated for (1) NHH’s adjustment of hyperinflation (core item, from financial expenses to equity) and (2) adjustment to the purchase price of NHH (non-core item, within one year after the acquisition as per accounting standard).
* Non-core items are detailed on page 45.
70,000
72,500
75,000
77,500
80,00078,499
-708
79,328
0
2018 Core
Revenue
Non-core Items
2018 Reported Revenue
Non-core (NHH
Purchase Price)
Core (NHH
Hyper-inflation)
2018 Restated Reported Revenue
Non-core Previous
+ Adjusted
2018 Restated
Core Revenue
As Previously Reported Adjustments Restated
+82978,620
-121
78,499
REVENUE
THB million
THB million
3,000
4,000
5,000
6,0005,957
-229
4,508
5,728
-512
-708
5,445 +1,220
2018 Core NPAT
Non-core Items
2018 Reported
NPAT
Non-core (NHH
Purchase Price)
Core (NHH
Hyper-inflation)
2018 Restated Reported
NPAT
Non-core Previous
+ Adjusted
2018 Restated
Core NPAT
As Previously Reported Adjustments Restated