6 Useful Things to Learn from Thai Beverage Public Company Limited’s Latest Earnings

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

In mid-November this year, Thai Beverage announced its results for the third quarter of 2016. I had spent some time going through the company’s webcast for the earnings presentation and noted down six useful bits of information.

As a quick introduction, Thai Beverage is a food and beverage (F&B) purveyor that may be best known as the brewer of Chang beer. Operationally, Thai Beverage’s business can be divided into four major segments, namely Spirits, Beer, Non-alcoholic Beverages and Food. Geographically, it operates mainly out of Thailand. The Spirits segment would be its most important revenue and profit driver.

With that, here are my notes:

  1. The briefing kicked off with a quick reminder. Thai Beverage is changing its fiscal year from one that ends on 31 December to one that ends on 30 September. To facilitate the change, the fiscal year 2016 (FY2016), which began on 1 January 2016, will have three quarters only.
  2. For FY16, Thai Beverage’s Spirits segment earned revenue of THB 76.6 billion. The segment’s sales volume rose 2.3% from 408 million liters in the comparable period in 2015 to 417 million liters. Thai Beverage said that consumers traded down to brown spirits which has a lower price point and less profit per bottle. The segment’s net profit was relatively unchanged at THB 14.5 billion.
  3. The Beer segment enjoyed a very satisfactory performance due to the new-look Chang Classic bottle. Sales volume increased by over 54.5% year-on-year to reach 669 million liters for FY16. This helped the segment’s top-line to bubble up to THB 44.4 billion for FY16. Lower raw material costs led to the segment’s net profit spiking up to THB 2.8 billion, an increase of over 280%.
  4. Sales volume for the Non-alcoholic beverages segment increased by 6.8% year on year to 1.27 billion liters. The segment benefited from growth in sales volume of drinking water, carbonated soft drinks, ready-to-drink tea, and Jubjai. The segment’s revenue grew by 6.8% to THB 13.3 billion. The net loss for the segment also narrowed to THB 1.1 billion, compared to a net loss of THB 1.5 billion in the comparable period last year.
  5. Revenue from Thai Beverage’s Food segment increased marginally, up 1.4% to THB 5 billion in FY16. Thai Beverage benefited from the incorporation of Food of Asia Co. Ltd. Better cost efficiency helped the segment’s net profit to post a big increase from THB 23 million in the first nine months of last year to THB 54 million.
  6. Elsewhere, international revenue was down 10.5% in FY16 compared to the corresponding period last year. Weak sales in the Beer and Spirits segments contributed to the fall.

If you'd like to receive investing insights and be updated on the latest company and stock market news, sign up for a FREE subscription to The Motley Fool's weekly investing newsletter, Take Stock Singapore

Also, like us on Facebook to follow our latest hot articles. The Motley Fool's purpose is to help the world invest, better.

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.