SECTOR UPDATE

TOURISM & LEISURE

To post YoY & QoQ growth for 4Q14

27 January 2015
Sector: Tourism&Leisure Overweight

Recommendations and valuations

Investment thesis
Our coverage will post YoY and QoQ earnings growth for 4Q14 following
YoY slippage in 1Q-3Q14. Bangkok hotel operations have recently
normalized after missing 4Q13-1Q14 high season. Chinese New Year in
Feb 2015 will boost hotel performances. FY15 sector core earnings growth
will outperform the SET (27% for our coverage against a 16% for the SET,
BLS coverage). The stock prices of CENTEL, ERW and MINT should rise
further during 1Q15 in anticipation of bumper numbers.
To post resumed YoY and QoQ core earnings growth for 4Q14
We estimate an aggregate coverage core profit of Bt2.1bn for 4Q14
(the best of FY14), up by 12% YoY and 159% QoQ. MINT will post
record core earnings, CENTEL will report YoY and QoQ growth and
ERW will see a QoQ turnaround. CENTEL may also realize a Bt100m
one-time gain from boosting its stake in Centara Kata Phuket in 4Q14.
CENTEL is expected to post a core profit of Bt398m for 4Q14, up by
40% YoY and 137% QoQ. Hotel RevPar rose 5% YoY, driven by an
occupancy rate of 81% (80% in 4Q13) and a 4% YoY mean room rate
rise, led by 11% room rate increases for two hotels in the Maldives.
Excluding the Maldives properties, RevPar was up 1% YoY. RevPar for
hotels in Bangkok resumed 7% YoY growth, driven by an occupancy
rate rise from 74% in 4Q13 to 83% in 4Q14. Food SSSG was 1.7%
TSSG was 9.4%.
ERW will post a turnaround from a core loss of Bt91m for 3Q14 to a core
profit of Bt51m for 4Q14 (but down 13% YoY, due to renovations at
Renaissance Samui in Oct-Nov 2014 and additional depreciation of hotels
in Pattaya). RevPar rose 1% YoY, led by 2% mean room rate growth
(occupancy declined 1% to 77%). RevPar for luxury hotels in Bangkok
bounced 11% YoY, which offset the effect of weak RevPar for other
hotels (slippage of 8% YoY for luxury resorts, 4% for the mid-range and
1% for economy hotels). Room inventory rose 16% YoY with the
openings of the Holiday Inn and Mercure Pattaya.
MINT will report a record core profit of Bt1.69bn, up by 8% YoY and
126% QoQ. Strong expansion of franchised food outlets drove high
TSSG of 16.5% for 4Q14. Assumed SSSG of only 0.4% was due to
SSS slippage in China and Singapore against 3% SSSG in Thailand.
System-wide hotel RevPar rose 1% YoY (a 3% higher room rate but a
1% lower occupancy to 70%). Residential income dived YoY and QoQ,
we believe, due to much lower St.Regis condo revenue and no
residential sales at The Estate Samui (one unit was sold in 3Q14).
1Q15 high season will see a full recovery (even in Bangkok)
1Q15 aggregate core profit will rise YoY and QoQ (strong earnings for all
three firms under our coverage), driven by occupancy. Hotels in Bangkok
will bounce YoY from the very low base set by political conflict in 1Q14.
Low single-digit room rate growth is also expected.
See disclaimer at the end of report

Rec.

Target PER PER Core profit

Core profit PBV PBV ROE ROE
Price (x)
(x) growth FY14 growth FY15 (x)
(x)
(%)
(%)
YE15 FY14 FY15
FY14 FY15 FY14 FY15
(Bt)

CENTEL

BUY

43.0

40.8

30.3

-16%

35%

3.8

3.5

10.4

ERW

BUY

6.0

n.m.

83.0

n.m.

turnaround

2.5

2.4

-2.3

3.1

MINT

BUY

41.5

30.4

26.3

7%

18%

4.5

4.0

16.8

17.3

13.0

Hotel performances comparisons

Occupancy rate

Room rate

RevPar

YoY
6%

5%

4%
4%

3%

2%

2%
1%

1%

1%

0%
-1%

-1%

-2%
CENTEL

ERW

MINT

Aggregate core profit, by quarter

4Q14e

Hotel performances

Food

Occupancy rate Room rate RevPar

Core profit (Btm)

SSS

TSS

(YoY)

(YoY)

(YoY)

(YoY)

4Q14e

YoY

QoQ

CENTEL

81%

4%

5%

1.7%

9.4%

398

40%

137%

ERW

77%

2%

1%

51

-13%

turnaround

MINT

70%

3%

1%

0.4%

16.5%

1,686

8%

126%

2,136

12%

159%

Total

Narumon Ekasamut
Securities Fundamental Investment Analyst
narumon.e@bualuang.co.th
+66 2 618 1345

Figure 1 :

4Q14E earnings previews

Btm

4Q14e

CENTEL

QoQ%

2014e
BLS

Consensus

BLS

Cons

100%

93%

nm

nm

100%

99%

100%

96%

284

40%

168

137%

1,110

1,188

Net profit

398

284

40%

168

137%

1,110

1,188

Revenue

5,083

4,520

12%

4,285

19%

Gross profit

1,923

1,793

7%

1,667

15%

37.8%

39.7%

38.9%

Core profit

51

59

-13%

-91

turnaround

-169

-74

Net profit

53

64

-17%

-83

turnaround

-109

-74

Revenue

1,398

1,263

11%

1,008

39%

718

671

7%

452

59%

51.4%

53.1%

Gross margin

44.9%

Core profit

1,686

1,556

8%

746

126%

4,400

4,453

Net profit

1,686

1,556

8%

746

126%

4,400

4,453

Revenue

11,996

9,748

23%

8,500

41%

6,873

5,916

16%

4,488

53%

57.3%

60.7%

Gross profit
Gross margin
Total

3Q14

398

Gross profit

MINT

YoY%

Core profit

Gross margin
ERW

4Q13

52.8%

Core profit

2,136

1,899

12%

823

159%

5,341

5,567

Net profit

2,138

1,905

12%

831

157%

5,400

5,567

Revenue

18,477

15,532

19%

13,792

34%

9,514

8,380

14%

6,607

44%

51.5%

54.0%

Gross profit
Gross margin

Figure 2 :

47.9%

4Q14E operational performance indicators

4Q14e

4Q13

4Q14e

2Q14

Hotel occpancy rate

YoY Chg.

QoQ Chg.

MINT

70.0%

71.0%

66.0%

-1%

4%

CENTEL

81.1%

80.3%

73.2%

1%

8%

ERW

77.0%

77.8%

62.0%

-1%

15%

Hotel ADR (Bt/night)

MINT

6,281

6,098

5,321

3%

18%

CENTEL

4,925

4,749

4,136

4%

19%

ERW

2,689

2,634

2,351

2%

14%

Hotel RevPar (Bt/night)

MINT

4,399

4,355

3,486

1%

26%

CENTEL

3,993

3,814

3,029

5%

32%

ERW

2,062

2,048

1,458

1%

41%

Food SSS: YoY change

MINT

0.4%

0.9%

1.2%

CENTEL

1.7%

-2.9%

4.9%

16.5%

14.3%

13.9%

9.4%

5.4%

13.2%

Food TSS: YoY change

MINT
CENTEL

Figure 3 :

CENTELs Food performance

SSS

Figure 4 :
TSS

35.0%

YoY

MINTs Food performance

SSS

TSS

25.0%

30.0%

20.0%

25.0%
20.0%

15.0%

15.0%

10.0%

10.0%
5.0%

5.0%

0.0%

0.0%

-5.0%

-5.0%

1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
3Q09
4Q09
1Q10
2Q10
3Q10
4Q10
1Q11
2Q11
3Q11
4Q11
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14e

-10.0%

1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
3Q09
4Q09
1Q10
2Q10
3Q10
4Q10
1Q11
2Q11
3Q11
4Q11
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14e

YoY

Sources: Company data, Bualuang Research

Tourism & Leisure - 2

Figure 5 :

Occupancy rate hikes for all three names

Figure 6 :

The mean room rate in 2014

YoY
MINT

100%

CENTEL

ERW

1Q14

2Q14

3Q14

4Q14

25%

90%
20%

80%
70%

15%

60%
10%

50%
40%

5%

1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
3Q09
4Q09
1Q10
2Q10
3Q10
4Q10
1Q11
2Q11
3Q11
4Q11
1Q12
2Q12
3Q12
4Q12
1Q13
2Q13
3Q13
4Q13
1Q14
2Q14
3Q14
4Q14e

30%

Figure 7 :

0%
MINT

The 4Q14E core profit contribution to FY14E

Figure 8 :

Btm
6,000

ERW

CENTEL

Our coverage core earnings profile, by quarter

Btm

2014e

2013

FY06-13 mean

2,500
5,000

40%

4,000

2,000
4Q14e

38%
3,000

1,500

2,000
1,000

1,000

36%

proift in
4Q14e

CENTEL

ERW

9M14
MINT

500

Sector

-1,000

0
1Q

2Q

3Q

4Q

*ERW = core losses in 2Q14-3Q14

Figure 9 :

Our coverage will post YoY and QoQ core profit

Figure 10 : Our Tourism coverage index versus the SET

growth for 4Q14

YoY

QoQ

Broad SET

150%

recovery

130.0

Hotel coverage index

100%

high season
in 4Q4-1Q5

high season
high season

120.0
110.0

50%

100.0
90.0

0%

80.0
70.0

-50%

Dec-14

Oct-14

Aug-14

Jun-14

Apr-14

1Q15e

Feb-14

4Q14e

Dec-13

3Q14

Oct-13

2Q14

Aug-13

1Q14

Jun-13

-100%

Apr-13

Feb-13

60.0

Figure 11 : Our Tourism coverages core profit profile versus the SET (BLS coverage)
SET

YoY

Tourism sector

100%

Thai political stability

75%
50%
25%
0%
-25%
-50%
2008

2009

2010

2011

2012

2013

2014e

2015e

Sources: Company data, Bualuang Research

Tourism & Leisure - 3

CENTEL : Financial Tables Year

PROFIT & LOSS (Btm)
Revenue
Cost of sales and services
Gross profit
SG&A
EBIT
Interest expense
Other income/exp.
EBT
Corporate tax
After-tax net profit (loss)
Minority interest
Equity earnings from affiliates
Extra items
Net profit (loss)
Reported EPS
Fully diluted EPS
Core net profit
Core EPS
EBITDA
KEY RATIOS
Revenue growth (%)
Gross margin (%)
EBITDA margin (%)
Operating margin (%)
Net margin (%)
Core profit margin (%)
ROA (%)
ROCE (%)
Asset turnover (x)
Current ratio (x)
Gearing ratio (x)
Interest coverage (x)
BALANCE SHEET (Btm)
Cash & Equivalent
Accounts receivable
Inventory
PP&E-net
Other assets
Total assets
Accounts payable
ST debts & current portion
Long-term debt
Other liabilities
Total liabilities
Paid-up capital
Share premium
Retained earnings
Shareholders equity
Minority interests
Total Liab.&Shareholders' equity
CASH FLOW (Btm)
Net income
Depreciation and amortization
Change in working capital
FX, non-cash adjustment & others
Cash flows from operating activities
Capex (Invest)/Divest
Others
Cash flows from investing activities
Debt financing (repayment)
Equity financing
Dividend payment
Others
Cash flows from financing activities
Net change in cash
Free cash flow (Btm)
FCF per share (Bt)
KEY ASSUMPTIONS
Hotel occupancy rate
Room rate change
RevPar change
SSS growth
TSS growth

2012
2013
14,504
17,096
(8,679) (10,219)
5,825
6,877
(4,407) (5,024)
1,418
1,853
(486)
(507)
511
461
1,442
1,808
(331)
(453)
1,111
1,355
(23)
(55)
66
22
443
0
1,596
1,322
1.18
0.98
0.85
0.98
1,153
1,322
0.85
0.98
3,764
3,859

2014E
2015E
2016E
18,428
20,812
22,697
(10,985) (12,303) (13,419)
7,444
8,509
9,278
(5,824) (6,570) (7,132)
1,620
1,939
2,146
(529)
(478)
(417)
420
431
441
1,510
1,891
2,170
(389)
(388)
(445)
1,121
1,503
1,725
(57)
(60)
(63)
45
51
54
0
0
0
1,110
1,493
1,716
0.82
1.11
1.27
0.82
1.11
1.27
1,110
1,493
1,716
0.82
1.11
1.27
3,857
4,208
4,427

28.6
40.2
26.0
9.8
11.0
8.0
6.4
8.5
0.6
0.3
1.2
2.9

17.9
40.2
22.6
10.8
7.7
7.7
4.6
6.0
0.6
0.4
1.0
3.7

7.8
40.4
20.9
8.8
6.0
6.0
3.8
4.9
0.6
0.6
0.9
3.1

12.9
40.9
20.2
9.3
7.2
7.2
5.1
6.6
0.7
0.5
0.8
4.1

9.1
40.9
19.5
9.5
7.6
7.6
5.9
7.7
0.8
0.3
0.6
5.1

297
857
473
22,769
3,753
28,149
1,997
4,957
6,912
4,354
18,220
1,350
970
3,990
8,965
965
28,149

723
936
615
23,418
3,520
29,212
2,332
3,419
7,943
4,366
18,060
1,350
970
4,907
10,344
807
29,212

707
996
654
23,589
3,501
29,447
2,207
1,751
9,344
4,280
17,581
1,350
970
5,563
11,001
865
29,447

536
945
739
23,542
3,501
29,262
2,271
2,201
7,544
4,436
16,453
1,350
970
6,447
11,884
925
29,262

144
850
805
23,593
3,501
28,893
2,477
2,801
5,200
4,527
15,005
1,350
970
7,462
12,899
988
28,893

1,596
1,351
107
(345)
2,709
1,900
(3,851)
(1,951)
157
0
(203)
(3,851)
(690)
69
4,609
3.4
2012
70.5
3.2
6%
6.2
27%

1,322
1,578
(815)
1,828
3,913
2,100
(3,941)
(1,841)
(466)
0
(405)
(3,941)
(1,646)
426
6,013
4.5
2013
80%
16%
25%
0.9
10%

1,110
1,829
27
(193)
2,773
2,000
(3,981)
(1,981)
(267)
0
(540)
(3,981)
(807)
(15)
4,773
3.5
2014E
75%
5%
4%
1.0
9%

1,493
1,848
(98)
190
3,432
1,800
(3,600)
(1,800)
(1,350)
0
(453)
(3,600)
(1,803)
(171)
5,232
3.9
2015E
80%
5%
10%
2.0
10%

1,716
1,849
(178)
475
3,862
1,900
(3,800)
(1,900)
(1,744)
0
(610)
(3,800)
(2,354)
(393)
5,762
4.3
2016E
82%
6%
8%
2.0
10%

Revenue growth and asset turnover

Revenue growth (%) (LHS)
Asset turnover (x) (RHS)

35
30
25
20
15
10
5
0

x
1.0
0.8
0.6
0.4
0.2
0.0

10

11

12

13

14E 15E 16E

A/C receivable & A/C payable days

AR / Sales (days)
AP / Cost of Goods (days)

120
100
80
60
40
20
0
10

11

12

13

14E

15E

16E

15E

16E

Profit margins
Gross margin (%)
EBIT margin (%)

%
60
50
40
30
20
10
0
10

11

12

13

14E

Capital expenditure
Capex (Bt,bn)
Capex / Net PPE (%)

Bt,bn
0.0
(0.5)

10

11

12

13

14E 15E 16E

(5)

(1.0)

(10)

(1.5)

(15)

(2.0)
(2.5)

(20)

Debt serviceability
(ST debt + Interest) / EBITDA
(Debt + Interest) / EBITDA

7
6
5
4
3
2
1
0
10

11

12

13

14E

15E

16E

Dividend payout

0.6
0.5
0.4

0.40
0.30

0.3
0.2
0.1

Dividend (Bt)
Payout ratio (%)

0.45

0.52

0.34

60
40
20
0

0.15

(20)
(40)

0.05

(60)

0.0
10

11

12

13

14E 15E 16E

Tourism & Leisure - 4

ERW : Financial Tables Year

PROFIT & LOSS (Btm)
Revenue
Cost of sales and services
Gross profit
SG&A
EBIT
Interest expense
Other income/exp.
EBT
Corporate tax
After-tax net profit (loss)
Minority interest
Equity earnings from affiliates
Extra items
Net profit (loss)
Reported EPS
Fully diluted EPS
Core net profit
Core EPS
EBITDA
KEY RATIOS
Revenue growth (%)
Gross margin (%)
EBITDA margin (%)
Operating margin (%)
Net margin (%)
Core profit margin (%)
ROA (%)
ROCE (%)
Asset turnover (x)
Current ratio (x)
Gearing ratio (x)
Interest coverage (x)
BALANCE SHEET (Btm)
Cash & Equivalent
Accounts receivable
Inventory
PP&E-net
Other assets
Total assets
Accounts payable
ST debts & current portion
Long-term debt
Other liabilities
Total liabilities
Paid-up capital
Share premium
Retained earnings
Shareholders equity
Minority interests
Total Liab.&Shareholders' equity
CASH FLOW (Btm)
Net income
Depreciation and amortization
Change in working capital
FX, non-cash adjustment & others
Cash flows from operating activities
Capex (Invest)/Divest
Others
Cash flows from investing activities
Debt financing (repayment)
Equity financing
Dividend payment
Others
Cash flows from financing activities
Net change in cash
Free cash flow (Btm)
FCF per share (Bt)
Room rate change
RevPar change
Gain from asset sales (Btm)
Hotel GM

2012
4,302
(1,966)
2,336
(1,775)
561
(393)
38
206
(111)
94
(60)
0
13
46
0.02
0.01
34
0.02
1,202

2013
4,702
(2,215)
2,487
(1,913)
574
(368)
26
231
(91)
141
(30)
16
811
938
0.38
0.05
127
0.05
1,281

2014E
4,279
(2,243)
2,037
(1,857)
180
(393)
26
(187)
34
(153)
(33)
17
60
(109)
(0.04)
(0.07)
(169)
(0.07)
872

2015E
5,737
(2,581)
3,155
(2,527)
628
(444)
26
210
(45)
165
(34)
17
0
148
0.06
0.06
148
0.06
1,333

2016E
6,372
(2,867)
3,505
(2,794)
711
(486)
26
251
(54)
197
(36)
18
0
180
0.07
0.07
180
0.07
1,424

14.6
54.3
27.9
13.0
1.1
0.8
0.4
0.4
0.3
0.4
2.1
1.4

9.3
52.9
27.2
12.2
19.9
2.7
7.1
7.9
0.4
0.6
1.3
1.6

(9.0)
47.6
20.4
4.2
(2.6)
(4.0)
(0.8)
(0.9)
0.3
0.2
1.7
0.5

34.1
55.0
23.2
11.0
2.6
2.6
1.0
1.1
0.4
0.2
1.6
1.4

11.1
55.0
22.3
11.2
2.8
2.8
1.2
1.4
0.4
0.2
1.5
1.5

481
195
49
10,122
1,994
12,840
228
1,080
6,794
1,050
9,152
2,245
360
879
3,494
194
12,840

477
209
52
10,558
2,420
13,715
244
1,002
6,028
1,213
8,486
2,475
776
1,773
5,035
194
13,715

478
152
123
11,609
1,942
14,304
258
2,037
5,986
1,213
9,494
2,478
778
1,316
4,584
226
14,304

479
204
141
11,904
1,790
14,519
283
2,182
5,782
1,213
9,460
2,503
779
1,505
4,799
260
14,519

480
227
157
12,191
1,673
14,729
291
2,155
5,851
1,213
9,509
2,503
779
1,630
4,923
296
14,729

46
641
(178)
(13)
497
(1,040)
0
(1,040)
(16)
2
(180)
0
(235)
(779)
(544)
(0.2)
2012
2%
6%
19
52.3%

938
707
(183)
(811)
652
(1,158)
0
(1,158)
(844)
646
(17)
0
(210)
(716)
(507)
(0.2)
2013
2%
7%
805
50.8%

(109)
692
1
(60)
524
(1,727)
0
(1,727)
993
5
(347)
0
651
(552)
(1,203)
(0.5)
2014E
-1%
-15%
0
45.4%

148
705
46
0
898
(983)
0
(983)
(59)
26
41
0
8
(76)
(84)
(0.0)
2015E
2%
15%
0
53.6%

180
713
31
0
923
(982)
0
(982)
41
0
(55)
0
(14)
(72)
(59)
(0.0)
2016E
2%
4%
0
53.7%

Revenue growth and asset turnover

Revenue growth (%) (LHS)
Asset turnover (x) (RHS)

x
0.50

40
30
20
10
0
(10)
(20)

0.40
0.30
0.20
0.10
0.00
10

11

12

13

14E 15E 16E

A/C receivable & A/C payable days

AR / Sales (days)
AP / Cost of Goods (days)

50
40
30
20
10
0
10

11

12

13

14E

15E

16E

15E

16E

Profit margins
Gross margin (%)
EBIT margin (%)

%
60
50
40
30
20
10
0
10

11

12

13

14E

Capital expenditure
Bt,bn

Capex (Bt,bn)
Capex / Net PPE (%)

2.0

20

1.5

15

1.0

10

0.5

0.0

0
10

(0.5)

11

12

13

14E 15E 16E

(1.0)

(5)
(10)

Debt serviceability
(ST debt + Interest) / EBITDA
(Debt + Interest) / EBITDA

x
12
10
8
6
4
2
0
10

11

12

13

14E

15E

16E

Dividend payout
Dividend (Bt)
Payout ratio (%)

0.20

0.15

0.15

0.00
-0.05

80

0.08

0.10
0.05

%
100

10

60
0.02

0.00

0.02 0.03

40
20

11

12

13 (0.02)
14E 15E 16E

Tourism & Leisure - 5

MINT : Financial Tables Year

PROFIT & LOSS (Btm)
Revenue
Cost of sales and services
Gross profit
SG&A
EBIT
Interest expense
Other income/exp.
EBT
Corporate tax
After-tax net profit (loss)
Minority interest
Equity earnings from affiliates
Extra items
Net profit (loss)
Reported EPS
Fully diluted EPS
Core net profit
Core EPS
EBITDA
KEY RATIOS
Revenue growth (%)
Gross margin (%)
EBITDA margin (%)
Operating margin (%)
Net margin (%)
Core profit margin (%)
ROA (%)
ROCE (%)
Asset turnover (x)
Current ratio (x)
Gearing ratio (x)
Interest coverage (x)
BALANCE SHEET (Btm)
Cash & Equivalent
Accounts receivable
Inventory
PP&E-net
Other assets
Total assets
Accounts payable
ST debts & current portion
Long-term debt
Other liabilities
Total liabilities
Paid-up capital
Share premium
Retained earnings
Shareholders equity
Minority interests
Total Liab.&Shareholders' equity
CASH FLOW (Btm)
Net income
Depreciation and amortization
Change in working capital
FX, non-cash adjustment & others
Cash flows from operating activities
Capex (Invest)/Divest
Others
Cash flows from investing activities
Debt financing (repayment)
Equity financing
Dividend payment
Others
Cash flows from financing activities
Net change in cash
Free cash flow (Btm)
FCF per share (Bt)
KEY ASSUMPTIONS
Hotel occupancy rate
Room rate change
RevPar change
SSS growth
TSS growth
Residential income (Btm)

2012
2013
2014E
2015E
2016E
31,310
34,669
38,698
43,826
47,649
(13,790) (14,549) (17,006) (19,458) (21,180)
17,520
20,120
21,692
24,369
26,469
(14,315) (16,504) (17,353) (19,340) (20,718)
3,205
3,616
4,339
5,029
5,750
(1,085) (1,027) (1,348) (1,206) (1,058)
1,237
1,738
1,824
1,916
2,012
3,356
4,327
4,815
5,738
6,704
(556)
(675)
(854) (1,004) (1,164)
2,801
3,652
3,961
4,735
5,540
(4)
(80)
(84)
(88)
(93)
446
530
523
534
573
0
0
69
0
0
3,243
4,101
4,469
5,180
6,020
0.88
1.02
1.12
1.29
1.50
0.88
1.02
1.12
1.29
1.50
3,243
4,101
4,400
5,180
6,020
0.88
1.02
1.10
1.29
1.50
6,643
7,819
8,972
10,141
11,178

Revenue growth and asset turnover

Revenue growth (%) (LHS)
Asset turnover (x) (RHS)

50

0.8

40

0.6

30

0.4

20

0.2

10
0

0.0
10

11

12

13

14E

15E

16E

A/C receivable & A/C payable days

AR / Sales (days)
AP / Cost of Goods (days)

150
120
90

19.8
56.0
21.2
10.2
10.4
10.4
7.0
8.1
0.7
1.1
1.3
3.0

10.7
58.0
22.6
10.4
11.8
11.8
7.3
8.6
0.6
1.0
0.9
3.5

11.6
56.1
23.2
11.2
11.5
11.4
7.4
8.7
0.6
0.8
0.7
3.2

13.3
55.6
23.1
11.5
11.8
11.8
8.3
9.9
0.7
0.7
0.6
4.2

8.7
55.5
23.5
12.1
12.6
12.6
9.2
11.1
0.7
0.7
0.5
5.4

3,702
2,955
1,616
20,397
23,050
51,721
4,640
910
24,063
3,045
32,659
3,687
7,332
10,641
17,864
1,198
51,721

3,370
3,332
1,675
23,432
28,127
59,936
4,998
971
23,196
3,897
33,062
4,001
7,332
13,558
25,090
1,784
59,936

2,483
3,511
1,693
25,624
28,127
61,438
5,917
2,000
19,596
3,897
31,410
4,001
7,332
16,627
28,159
1,868
61,438

2,918
3,603
1,830
27,427
28,127
63,905
6,770
3,500
15,997
3,897
30,163
4,001
7,332
20,253
31,785
1,957
63,905

3,326
3,969
2,182
29,011
28,127
66,616
7,369
4,900
12,397
3,897
28,563
4,001
7,332
24,471
36,004
2,050
66,616

3,243
2,201
2,303
(3,702)
4,046
(4,170)
(2,159)
(6,329)
4,532
912
(493)
(2,159)
4,834
2,551
(125)
(0.03)
2012
69%
4%
11%
4.5%
15.1%
2,899

4,101
2,465
(1,649)
264
5,181
(5,127)
(1,847)
(6,974)
(948)
3,602
(1,185)
(1,847)
1,445
(348)
54
0.01
2013
70%
0%
1%
4.1%
13.8%
3,320

4,469
2,808
(2,639)
3,555
8,194
(5,000)
0
(5,000)
(2,571)
0
(1,400)
0
(3,887)
(693)
3,194
0.80
2014E
66%
9%
3%
3.2%
10.5%
2,532

5,180
3,196
(1,689)
2,363
9,050
(5,000)
0
(5,000)
(2,100)
0
(1,554)
0
(3,566)
484
4,050
1.01
2015E
70%
0%
6%
2.9%
9.5%
3,132

6,020
3,416
(872)
783
9,346
(5,000)
0
(5,000)
(2,200)
0
(1,801)
0
(3,908)
438
4,346
1.09
2016E
75%
4%
12%
2.9%
9.5%
3,612

60
30
0
10

11

12

13

14E

15E

16E

15E

16E

Profit margins
Gross margin (%)
EBIT margin (%)

70
60
50
40
30
20
10
0
10

11

12

13

14E

Capital expenditure
%

Capex (Bt,bn)
Capex / Net PPE (%)

35
30
25
20
15
10
5
0

5
4
3
2
1
0
10

11

12

13

14E

15E

16E

Debt serviceability
(ST debt + Interest) / EBITDA
(Debt + Interest) / EBITDA

6
5
4
3
2
1
0
10

11

12

13

14E

15E

16E

Dividend payout

0.6
0.5
0.4

0.30

0.3
0.2

Dividend (Bt)
Payout ratio (%)

0.35

0.39

0.52
0.45

50
40
30
20

0.15 0.15

10

0.1

0.0
10

11

12

13

14E

15E

16E

Tourism & Leisure - 6

Regional Comparisons
Bloomberg
Code
BTH SP
Banyan Tree Holding
BREAD SP
Breadtalk Group
Mandarin Oriental
MAND SP
Formosa International Hotels C 2707 TT
The Ambassador Hotel,Ltd.
2704 TT
2006 HK
Jin Jiang Hotel Group
69 HK
Shangri-La Asia Limited
The Hongkong&Shanghai Hote 45 HK
330 HK
Esprit Holding
Giordano International
709 HK
BFD MK
Berjaya Food
Bonia Corp
BON MK
PAD MK
Padini Holdings
9861 JP
Yoshinoya Holdings Co
Accor
AC FP
Inter Continental
IHG LN
Whitbread
WTB LN
Host Hotels
HST US
Choice Hotels
CHH US
Marriott Int'l
MAR US
Starwood
HOT US
Wyndham Worldwide Corporati WYN US
Domino's Pizza
DPZ US
Dunkin' Brands Group
DNKN US
Mcdonald's Corp
MCD US
The Gap
GPS US
OISHI Group Plc
OISHI TB
Central Plaza Hotel
CENTEL TB
The Erawan Group
ERW TB
Minor International
MINT TB
Simple average

PER (x)
EPS Growth (%)
PBV (x)
ROE (%)
Div Yield (%)
Price Market Cap
(US$
(local curr.) equivalent) 2014E 2015E 2014E 2015E 2014E 2015E 2014E 2015E 2014E 2015E
SGD0.5
SGD1.5
SGD1.7
TWD325.0
TWD28.0
HKD2.6
HKD10.1
HKD11.0
HKD8.5
HKD3.7
MYR3.0
MYR1.0
MYR1.5
JPY1,310.0
EUR44.4
GBP2,756.0
GBP5,065.0
USD24.1
USD59.1
USD79.4
USD75.3
USD87.3
USD98.7
USD47.0
USD90.7
USD42.4
SGD75.0
THB33.50
THB4.90
THB34.00

300
324
1,656
1,213
328
1,852
4,673
2,161
2,140
749
310
222
269
708
11,622
9,821
13,872
18,282
3,436
22,503
13,449
10,756
5,431
4,915
88,240
17,947
432
1,390
373
4,181

44.2
30.9
19.4
32.5
24.2
16.0
30.4
26.5
72.4
14.2
30.0
13.2
10.1
70.6
27.8
26.5
24.6
20.5
29.3
31.0
26.7
19.6
33.9
26.8
17.4
15.4
30.6
40.8
n.m.
30.4
28.8

18.3
25.8
17.7
27.4
24.1
14.9
25.6
26.5
32.5
13.1
19.2
11.8
9.1
61.4
24.8
23.1
21.7
21.2
26.2
26.1
23.7
17.9
29.1
24.5
16.5
13.8
21.2
30.3
83.1
26.3
25.2

-49.8
n.a.
-7.4
5.0
20.1
n.a.
-22.9
51.7
-92.2
-4.0
28.2
48.2
8.5
36.5
141.1
23.8
10.6
159.5
4.4
22.7
-14.5
33.8
12.6
17.8
-7.4
-0.2
-6.2
-16.1
n.m.
9.0
15.3

141.7
n.a.
-4.5
19.0
-1.3
n.a.
6.4
-6.8
122.9
9.1
48.2
11.8
12.0
15.1
23.0
3.3
14.7
-1.4
13.1
20.3
10.3
10.9
16.3
13.0
6.2
13.4
23.4
34.6
n.m.
15.9
21.9

n.a.
n.a.
1.6
8.6
1.1
1.3
0.7
n.a.
1.0
1.9
2.5
0.7
2.1
1.9
3.2
n.a.
3.9
2.4
n.a.
n.a.
7.9
5.9
n.a.
13.4
6.5
6.6
3.5
3.8
2.5
4.5
3.8

n.a.
n.a.
1.6
7.9
1.1
1.4
0.6
n.a.
0.9
1.9
2.4
0.6
1.9
1.9
3.0
n.a.
3.4
2.3
n.a.
n.a.
6.9
4.7
n.a.
15.3
5.8
5.8
3.6
3.5
2.4
4.0
3.6

n.a.
15.8
8.0
35.0
4.6
9.0
2.3
n.a.
2.6
15.0
14.2
17.1
32.5
3.2
14.1
-58.1
19.4
7.9
-38.6
-59.3
33.6
35.6
-16.9
48.5
38.7
41.8
17.9
10.4
-2.3
16.8
9.6

n.a.
14.5
7.7
33.2
4.8
8.6
2.0
1.9
1.4
13.6
12.9
16.6
25.7
2.6
13.1
-64.1
19.8
9.4
-27.4
-49.6
22.8
37.9
-13.3
46.6
34.6
40.6
13.8
13.0
3.1
17.3
9.1

n.a.
1.3
4.1
2.4
2.3
2.6
1.1
1.7
0.7
6.7
1.6
2.8
7.0
1.5
2.0
1.8
1.5
2.9
1.3
1.0
1.8
1.6
1.0
1.9
3.8
2.0
1.7
1.0
-0.3
1.1
2.1

n.a.
1.3
4.4
2.6
2.4
3.4
1.3
1.8
1.9
7.0
2.3
3.0
7.7
1.5
2.2
2.0
1.7
3.4
1.3
1.1
2.0
1.6
1.1
2.3
4.0
2.0
2.5
1.3
0.4
1.3
2.4

Tourism & Leisure - 7

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HOLD: Expected total returns of between -15% and +15% over the next 12
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SELL: Expected negative total returns of 15% or more over the next 12
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Tourism & Leisure - 8