6 Useful Things for Investors to Learn About Thai Beverage Public Company Limited

Thai Beverage Public Company Limited (SGX: Y92) is one of the cool companies in Singapore that shares webcasts and/or transcripts of their quarterly earnings presentations.

There may be useful and new information investors can pick out from the webcasts and transcripts. Last week, Thai Beverage had released its earnings for 2015 and also hosted an earnings presentation. I had spent some time listening to the webcast for that particular earnings briefing and noted six useful things investors can learn from it.

But before I share them, here’s a quick background of Thai Beverage for some context later. The company’s a food and beverage (F&B) purveyor based in Thailand. It has four major business segments, namely Spirits, Beer, Non-alcoholic Beverages, and Food. Geographically, the company operates mainly out of Thailand. In Singapore, Thai Beverage may be best known for its Chang brand of beers.

With that, here are my notes:

  1. For the whole of 2015, Thai Beverage’s Spirits segment saw a 1.3% increase in sales on the back of higher prices and higher volume sold. Spirit sales volume rose by 1.2% from 559 million liters to 566 million liters. Sales, general and administrative (SG&A) expense had climbed due to a corporate restructuring during the year which saw more sales personnel hired. This held back the segment’s profit, which fell 0.7%.
  2. Thai Beverage’s spirits were lifted (pun intended) in the Beer segment which enjoyed strong growth momentum from the launch of the new look Chang Classic bottle. Sales volume jumped by 17.5% to reach 671 million liters for 2015. This helped the segment’s topline to bubble up to THB 43 billion for the full year. SG&A for the Beer segment grew slower than its sales, which resulted in the segment’s net profit tripling to THB 1.2 billion in 2015.
  3. The non-alcoholic beverages segment had benefited from the launch of 100Plus and Jubjai. Sales volume increased by 2.6% to 1.5 billion liters, leading to sales growth of 4.5%.
  4. Thai Beverage’s beer volume hit a new high in 2015. This marked the segment’s best year over the past seven years, in terms of beer volume. The majority of the company’s beer volume gains also came from its domestic Thai market.
  5. When asked about the unchanged 2015 dividend payout for Thai Beverage, the management team pointed towards the increase of nearly 40% in the dividend payout which occurred from 2013 to 2014. For context, Thai Beverage had paid out THB 0.44 per share in dividend in 2013 and THB 0.61 per share in dividend in 2014.
  6. Excise taxes make up more than half of the cost of its Beer and Spirits segment. Ueychai Tantha-Obhas, Executive Vice President Spirit Product Group, said that taxes are “a fact of life” in this business and he expects the taxes to rise in the current year.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.