Mono Technology
Mono Technology
Outperform (16E TP Bt3.60)
Earnings Review
Close Bt3.64
Media & Publishing February 22, 2017
Beat forecast/Below forecast/In‐line
Ad revenue plunged deeper than forecast Results date: February 21, 2017 Price Performance (%)
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
0.058
0.100
KT ZMICO vs. consensus Share data
‐13.8%
10.0%
Reuters / Bloomberg
MONO.BK/MONO TB
Paid‐up Shares (m)
3,343.94
Par (Bt)
0.10
Market cap (Bt bn / US$ m)
12.00/348.00
Foreign limit / actual (%)
49.00/1.11
52 week High / Low (Bt)
4.10/1.92
Avg. daily T/O (shares 000)
17,127.00
NVDR (%)
1.21
Estimated free float (%)
23.59
Beta
1.52
URL
www.mono.co.th
CGR
Anti‐corruption
Level 4 (Certified)
Anapat Wanuschaiyapruk Analyst, no 57076 [email protected] 66 (0) 2-624‐6236
Earning missed on operation and extra items MONO’s 4Q16 net loss came out at Bt193mn, much deeper than our forecast due to 1) 17% lower revenue than our expectation and 2) three impairment losses amounting to Bt46mn. The core loss was Bt146mn, which is far more than our forecast of Bt45mn. However, the TV business will continue to grow from increasing TV ratings and a discounted ad rate compared to peers. We maintain our Outperform rating with the 17E TP of Bt3.60. MONO will pay a dividend of Bt0.03 and will sell 330mn new shares (10% of current shares) through private placement. 4Q16 ad revenue missed by 50% Ad revenue in 4Q16 was Bt170mn, missing our forecast by 50% and declining 22%YoY from Bt218mn in 4Q15 as MONO29 was restrained from commercial activities for 30 days. However, its full‐year ad revenue still managed to grow 44% from Bt752mn in 2016 to Bt1,085mn in 2016. Its channel rating in Dec’16 was at 0.914 (age 4+, 24 hours, nationwide), increasing from 0.507 in Dec’15. We believe there is still room for an ad rate increase. MVAS heading further down Revenue from MVAS met our expectation, dropping 15%YoY and 4%QoQ to Bt209mn in 4Q16. However, the magnitude of the declining trend seems to already be slowing down, signaling a recovery phase for the business. Moreover, to address the downturn, MONO has announced that it is setting up two subsidiaries, namely, Mono Play and Mono Astro, to produce online content and games. Deep loss from operation and extra items Apart from core revenue that missed our forecast by 17%, MONO reported an impairment loss of Bt46mn from JV (Bt21mn), intangible assets (Bt24mn), and bad debts (Bt1mn). Without these extra items, the core loss was Bt46mn, more than our forecast of Bt45mn. Maintain Outperform with room for ad rate hike The average ad rate of MONO29 was around Bt22,000/min in 4Q16. The management plans to increase the ad rate by 20% ‐ 30% this year. Even with such a hike, its ad rate will still be discounted to TV peers. We believe there is still room for a big ad rate hike over the long term. Maintain Outperform with a possible upward earnings revision in the future. Financials and Valuation FY Ended 31 Dec Revenues (Btmn) Net profit (Btmn) EPS (Bt) EPS growth (%) Dividend (Bt) BV (Bt)
2014 1,526 (12) (0.00) ‐102.5% 0.16 0.95
2015 1,893 (487) (0.11) 3816.9% 0.00 0.78
2016 2,077 (250) (0.05) ‐48.7% 0.03 0.74
2017E 2,689 247 0.05 ‐198.8% 0.00 0.82
2018E 3,052 493 0.11 99.8% 0.00 0.97
FY Ended 31 Dec PER (x) EV/EBITDA (x) PBV (x) Dividend yield (%) ROE (%) Net gearing (%)
2014 ‐1,342.03 56.84 3.85 4.4% ‐0.4% ‐20%
2015 ‐34.26 57.12 4.66 0.0% ‐18.2% 28%
2016 ‐66.80 15.36 4.93 0.8% ‐10.4% 61%
2017E 67.59 9.93 4.46 0.0% 9.9% 69%
2018E 33.83 7.85 3.75 0.0% 17.2% 55%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
Figure 1: MONO’s 4Q16 earnings result Profit and Loss (Btmn) Year‐end 31 Dec Revenue Gross profit EBITDA Interest expense Other income Income tax Extra‐items Gn (Ls) from affiliates Net profit (loss) Core profit (loss) Reported EPS (Bt) Gross margin (%) EBITDA margin (%) Net margin (%) Current ratio (x) Interest coverage (x) Debt / equity (x) BVPS (Bt) ROE (%)
4Q15 512 88 143 (104) (5) 11 0 0 (129) (129) (0.04) 17.2 27.8 (25.1) 0.8 (0.3) 0.3 0.8 (5.1)
3Q16 604 165 271 (36) 12 (2) 0 (2) 10 10 0.00 27.3 44.9 1.7 0.9 1.1 0.5 0.0 0.0
4Q16 395 1 130 (39) 12 (1) (46) 0 (193) (146) (0.06) 0.1 33.0 (37.0) 0.8 (3.0) 0.6 0.0 0.0
% YoY (22.9) (99.4) (8.6) (62.4) (324.5) (108.8) n.a. n.a. (49.8) (13.7) (33.8)
% QoQ (34.6) (99.7) (51.9) 7.7 (0.7) (51.8) n.a. n.a. (2,004) (1,544) (1,913)
2015 1,893 240 216 (133) 32 54 0 0 (487) (487) (0.16) 12.7 11.4 (25.7) 0.4 (3.3) 0.3 0.8 (18.2)
2016 2,077 443 802 (145) 36 (10) (46) (2) (250) (203) (0.08) 21.3 38.6 (12.0) 0.8 (0.6) 0.6 0.7 (10.4)
%YoY 9.7 84.3 271.8 9.0 11.7 (118.0) n.a. n.a. 48.7 58.3 50.3
Sources: MONO, KT Zmico Research REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
FINANCIAL TABLE PROFIT & LOSS (Btmn) Revenues Cost of sales and service Gross profit SG&A EBITDA Depreciation & amortization EBIT Interest expense Other income / exp. EBT Corporate tax Gain (loss) from affiliates Extra Items Non‐controlling Net profit Reported EPS Fully diluted EPS Core net profit Core EPS Dividend (Bt) BALANCE SHEET (Btmn) Cash and equivalents Accounts receivable Inventories Investment PP&E‐net Other assets Total assets ST debt & current portion Long‐term debt Total liabilities Paid‐up shares Shareholder equity Total liab. & shareholder equity CASH FLOW (Btmn) Net income Non‐cash adjustment Depreciation & amortization Change in working capital Cash flow from operations Capex (Invest)/Divest Others Cash flow from investing Debt financing (repayment) Equity financing Dividend payment Others Cash flow from financing Net change in cash Free cash flow FCF per share (Bt) PROFITABILITY Revenue growth (%) EBITDA growth (%) EPS growth (%) Gross margin (%) EBITDA margin (%) Operating margin (%) Net margin (%) Core profit margin (%) Effective tax rate (%)
2013 1,407 (582) 826 (373) 512 (59) 452 (3) 91 540 (39) 0 0 0 501 0.16 0.11 501 0.16 0.43
2014 1,526 (1,011) 515 (588) 217 (290) (73) (81) 77 (77) 64 0 0 0 (12) (0.00) (0.00) (12) (0.00) 0.16
2015 1,893 (1,653) 240 (680) 216 (655) (439) (133) 32 (540) 54 0 0 0 (487) (0.16) (0.11) (487) (0.16) 0.00
2016 2,077 (1,634) 443 (525) 802 (885) (83) (145) 36 (192) (10) (2) (46) 0 (250) (0.08) (0.05) (203) (0.08) 0.00
2013 2,277 416 7 0 582 105 3,386 17 15 293 140 3,093 3,386
2014 998 578 8 0 3,569 248 5,400 13 409 2,489 308 2,911 5,400
2015 195 554 10 0 4,154 365 5,278 146 734 2,854 310 2,424 5,278
2016 87 530 9 51 4,315 400 5,392 141 1,397 3,026 498 2,366 5,392
2017E 2,689 (1,656) 1,033 (588) 1,241 (796) 445 (168) 31 308 (62) 0 0 0 247 0.08 0.05 247 0.08 0.00
2018E 3,052 (1,682) 1,370 (607) 1,570 (808) 763 (178) 32 616 (123) 0 0 0 493 0.15 0.11 493 0.15 0.00
2017E 206 686 9 51 4,487 407 5,846 0 2,000 3,234 498 2,612 5,846
2018E 801 778 9 51 4,636 412 6,687 0 2,500 3,582 498 3,105 6,687
2013 501 6 59 (131) 436 (357) 0 (357) (21) 2,720 (585) 0 2,115 2,194 79 0.02
2014 (12) 12 290 (118) 171 (1,659) 0 (1,659) 384 0 (174) 0 210 (1,279) (1,488) (0.32)
2013 ‐8.5% ‐25.4% ‐31.9% 58.7% 36.4% 32.1% 35.6% 35.6% 7.2%
2015 (487) 33 655 (307) (105) (1,139) 0 (1,138) 441 52 (62) 0 432 (804) (1,244) (0.27)
2014 8.5% ‐57.6% ‐102.5% 33.8% 14.2% ‐4.8% ‐0.8% ‐0.8% 83.8%
2016 (250) 59 885 (430) 264 (1,042) (83) (1,125) 658 95 (0) 0 753 (107) (862) (0.19)
2015 24.0% ‐0.5% 3790.5% 12.7% 11.4% ‐23.2% ‐25.7% ‐25.7% 9.9%
2017E 247 0 796 (417) 625 (968) 0 (968) 462 0 0 0 462 119 (343) (0.07)
2016 9.7% 271.8% ‐50.3% 21.3% 38.6% ‐4.0% ‐12.0% ‐9.8% ‐5.0%
2018E 493 0 808 (250) 1,051 (956) 0 (956) 500 0 0 0 500 594 94 0.02
2017E 29.5% 54.7% ‐198.8% 38.4% 46.2% 16.6% 9.2% 9.2% 20.0%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 4
2018E 13.5% 26.5% 99.8% 44.9% 51.5% 25.0% 16.1% 16.1% 20.0%
Note: KT ZMICO has two major shareholders, Krungthai Bank PLC (KTB) and Seamico Securities PLC (ZMICO). Therefore, prior to making investments in the securities of KTB and ZMICO, investors should consider the risk factors carefully. An executive of KT ZMICO Securities is also a board member of BCP, BTC, CI, CPI, KBS, MAJOR, MK, PACE, PSL, SVH, VNG, ZMICO, SAWAD, TFG. A management member of KT ZMICO Securities is also a board member of BTC and NFC. KT ZMICO is a financial advisor for U, LOXLEY, ZMICO, MAKRO, CPALL, SAFARI, M‐CHAI, TFD. KT ZMICO is a co underwriter of RPH.
Corporate Governance Report (CGR) Source: Sec, Thai Institute of Directors Association (IOD)
Excellent (scores: 90 ‐ 100) Very Good (scores: 80 – 89) Good (scores: 70 – 79)
Satisfactory (scores: 60 – 69) Pass (scores: 50 – 59) No Logo N/A (scores: below 50)
Anti‐corruption Progress Indicator Source: Sec, Thailand's Private Sector Collective Action Coalition Against Corruption programme (Thai CAC)
Level 1 (Committed) : Organization’s statement or board's resolution to work against corruption and to be in compliance with all relevant laws. Level 2 (Declared) : Public declaration statement to participate in Thailand's private sector Collective Action Coalition Against Corruption (CAC) or equivalent initiatives Level 3 (Established) : Public out preventive measures, risk assessment, communication and training for all employees, including consistent monitoring and review processes Level 4 (Certified) : Audit engagement by audit committee or auditors approved by the office of SEC, and receiving certification or assurance by independent external assurance providers (CAC etc.) Level 5 (Extended) : Extension of the anti‐corruption policy to business partners in the supply chain, and disclosure of any current investigations, prosecutions or closed cases Insufficient or not clearly defined policy Data not available / no policy
DISCLAIMER This document is produced using open sources believed to be reliable. However, their accuracy and completeness cannot be guaranteed. The statements and opinions herein were formed after due and careful consideration for use as information for the purposes of investment. The opinions contained herein are subject to change without notice. This document is not, and should not be construed as, an offer or the solicitation of an offer to buy or sell any securities. The use of any information contained in this document shall be at the sole discretion and risk of the user.
KT ZMICO RESEARCH – RECOMMENDATION DEFINITIONS STOCK RECOMMENDATIONS
SECTOR RECOMMENDATIONS
BUY: Expecting positive total returns of 15% or more OVERWEIGHT: The industry, as defined by the analyst's over the next 12 months coverage universe, is expected to outperform the relevant OUTPERFORM: Expecting total returns between ‐10% primary market index by at least 10% over the next 12 months. to +15%; returns expected to exceed market returns NEUTRAL: The industry, as defined by the analyst's coverage over a six‐month period due to specific catalysts universe, is expected to perform in line with the relevant UNDERPERFORM: Expecting total returns between primary market index over the next 12 months. ‐10% to +15%; returns expected to be below market UNDERWEIGHT: The industry, as defined by the analyst's returns over a six‐month period due to specific coverage universe, is expected to underperform the relevant catalysts primary market index by 10% over the next 12 months. SELL: Expecting negative total returns of 10% or more over the next 12 months
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 4 of 4
KT ZMICO Securities Company Limited Head Office
WWW.KTZMICO.COM
8th, 15th‐17th,19th, 21st Floor, Liberty Square Bldg., 287 Silom Road, Bangrak, Bangkok, Thailand 10500 Telephone: (66‐2) 695‐5000 Fax: (66‐2) 695‐5173 KT ZMICO Connect 662 695 5555
Central World Branch
Amarin Branch
22nd Floor, Amarin Building, 496‐502 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 018‐6200 Fax: (66‐2) 018‐6298, (66‐2) 018‐6299
8th Floor, Ton Son Tower, 900 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 626‐6000 Fax: (66‐2) 626‐6111
Phaholyothin Branch
Sindhorn Branch
Viphavadee Branch
2nd Floor, Sindhorn Tower 1, 130‐132 Wireless Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 627‐3550 Fax: (66‐2) 627‐3582, 627‐3600
G Floor, Lao Peng Nguan 1 Bldg., 333 Soi Cheypuand, Viphavadee‐Rangsit Road, Ladyao, Jatujak, Bangkok 10900 Telephone: (66‐2) 013‐8600 Fax: (66‐2) 618‐8569
BangKhae Branch
Chiang Mai Branch
Pak Chong Branch
999/9 The Offices at Central World, 16th Fl., Rama 1 Rd, Pathumwan, Bangkok 10330 Telephone: (66‐2) 264‐5888 Fax: (66‐2) 264 5899
1291/1, Shinnawatra Tower II, 3rd Floor, Phaholyothin Road, Phayathai, Bangkok 10400 Telephone: (66‐2) 686‐1500 Fax: (66‐2) 686‐1666
Ploenchit Branch
518 The Mall Group Building Bangkhae Branch, 6th Floor, Petchkasem Road, North Bangkhae, Bangkhae, Bangkok 10160 Telephone: (66‐2) 454‐9979 Fax: (66‐2) 454‐9970
422/49 Changklan Road, Changklan Subdistrict, Amphoe Meuang, Chiang Mai 50100 Telephone: (053) 270‐072 Fax: (053) 272‐618
173 175, Mittapap Road, Nong Sarai, Pak Chong, Nakhon Ratchasima 30130 Telephone: (044) 279‐511 Fax: (044) 279‐574
Korat Branch
Khon Kaen Branch
Chonburi Branch
624/9 Changphuek Road, T.Naimaung, A.Maung, Nakhon Ratchasima 30000 Telephone: (044) 247222 Fax: (044) 247171
5th Floor, Charoen Thani Princess Hotel, 260 Srichan Road, T. Naimuang, A. Muang, Khon Kaen 40000 Telephone: (043) 389‐171‐193 Fax: (043) 389‐209
4th Floor, Forum Plaza Bldg., 870/52 Sukhumvit Road, T. Bangplasoy, A. Muang, Cholburi 20000 Telephone: (038) 287‐635 Fax: (038) 287‐637
Pattaya Branch
Chachoengsao Branch
Hat Yai Branch
Easy Point 2, 392/65 Moo.9, T.Nong Prue, A. Bang Lamung, Chonburi 20260 Telephone: (038) 420‐965 Fax: (038) 420‐968
108/34‐36 Mahajakkrapad Road, T.Namuang, A.Muang, Chachoengsao 24000 Telephone: (038) 813‐088 Fax: (038) 813‐099
200/301, 200/303 JULDIS HATYAI PLAZA Floor 3 , Niphat‐Uthit 3 Rd, Hatyai Songkhla 90110 Telephone: (074) 355530‐3 Fax: (074) 355534
Phuket Branch
22/61‐63, Luang Por Wat Chalong Road, Talat Yai, Mueang Phuket, Phuket 83000 Telephone: (076) 222‐811, (076) 222‐683 Fax: (076) 222‐861
Phitsanulok Branch
227/171 Borom Trilokkanat Road, Muang, Phitsanulok 65000 Telephone: 055‐219‐255 to 8 Fax: 055‐219‐259
Nakhon Pathom
Cyber Branch Ayutthaya
Cyber Branch @ North Nana
Cyber Branch Chiangrai
KrungThai Bank, Rojana Branch 253 Moo 5, Rojana Road, Phai Ling, Phra Nakhon Si Ayutthaya, Phra Nakhonsi Ayutthaya, 13000 Telephone: 035‐242‐477 Fax: 035‐242‐476
Krung Thai Bank PCL, 2 Floor, North Nana Branch 35 Sukhumvit Rd., Klong Toey Nua Subdistrict , Wattana District , Bangkok 10110 Telephone: 083‐490‐2871
River Hotel (Building 3rd),1156 Petchakasem Road, Sanamchan Subdistrict, Amphoe Meuang , Nakhon Pathom Province 73000 Telephone: (034) 271300 Fax: (034) 271300 #100
KrungThai Bank, Hayaek Phokhun Mengrai Branch 116/19 Moo 19, Highway 110 Road, Rop Wiang, Mueang Chiang Rai, Chiang Rai, 57000 Telephone: 053‐715‐067 Fax: 053‐715‐068
Outperform (16E TP Bt3.60)
Earnings Review
Close Bt3.64
Media & Publishing February 22, 2017
Beat forecast/Below forecast/In‐line
Ad revenue plunged deeper than forecast Results date: February 21, 2017 Price Performance (%)
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
0.058
0.100
KT ZMICO vs. consensus Share data
‐13.8%
10.0%
Reuters / Bloomberg
MONO.BK/MONO TB
Paid‐up Shares (m)
3,343.94
Par (Bt)
0.10
Market cap (Bt bn / US$ m)
12.00/348.00
Foreign limit / actual (%)
49.00/1.11
52 week High / Low (Bt)
4.10/1.92
Avg. daily T/O (shares 000)
17,127.00
NVDR (%)
1.21
Estimated free float (%)
23.59
Beta
1.52
URL
www.mono.co.th
CGR
Anti‐corruption
Level 4 (Certified)
Anapat Wanuschaiyapruk Analyst, no 57076 [email protected] 66 (0) 2-624‐6236
Earning missed on operation and extra items MONO’s 4Q16 net loss came out at Bt193mn, much deeper than our forecast due to 1) 17% lower revenue than our expectation and 2) three impairment losses amounting to Bt46mn. The core loss was Bt146mn, which is far more than our forecast of Bt45mn. However, the TV business will continue to grow from increasing TV ratings and a discounted ad rate compared to peers. We maintain our Outperform rating with the 17E TP of Bt3.60. MONO will pay a dividend of Bt0.03 and will sell 330mn new shares (10% of current shares) through private placement. 4Q16 ad revenue missed by 50% Ad revenue in 4Q16 was Bt170mn, missing our forecast by 50% and declining 22%YoY from Bt218mn in 4Q15 as MONO29 was restrained from commercial activities for 30 days. However, its full‐year ad revenue still managed to grow 44% from Bt752mn in 2016 to Bt1,085mn in 2016. Its channel rating in Dec’16 was at 0.914 (age 4+, 24 hours, nationwide), increasing from 0.507 in Dec’15. We believe there is still room for an ad rate increase. MVAS heading further down Revenue from MVAS met our expectation, dropping 15%YoY and 4%QoQ to Bt209mn in 4Q16. However, the magnitude of the declining trend seems to already be slowing down, signaling a recovery phase for the business. Moreover, to address the downturn, MONO has announced that it is setting up two subsidiaries, namely, Mono Play and Mono Astro, to produce online content and games. Deep loss from operation and extra items Apart from core revenue that missed our forecast by 17%, MONO reported an impairment loss of Bt46mn from JV (Bt21mn), intangible assets (Bt24mn), and bad debts (Bt1mn). Without these extra items, the core loss was Bt46mn, more than our forecast of Bt45mn. Maintain Outperform with room for ad rate hike The average ad rate of MONO29 was around Bt22,000/min in 4Q16. The management plans to increase the ad rate by 20% ‐ 30% this year. Even with such a hike, its ad rate will still be discounted to TV peers. We believe there is still room for a big ad rate hike over the long term. Maintain Outperform with a possible upward earnings revision in the future. Financials and Valuation FY Ended 31 Dec Revenues (Btmn) Net profit (Btmn) EPS (Bt) EPS growth (%) Dividend (Bt) BV (Bt)
2014 1,526 (12) (0.00) ‐102.5% 0.16 0.95
2015 1,893 (487) (0.11) 3816.9% 0.00 0.78
2016 2,077 (250) (0.05) ‐48.7% 0.03 0.74
2017E 2,689 247 0.05 ‐198.8% 0.00 0.82
2018E 3,052 493 0.11 99.8% 0.00 0.97
FY Ended 31 Dec PER (x) EV/EBITDA (x) PBV (x) Dividend yield (%) ROE (%) Net gearing (%)
2014 ‐1,342.03 56.84 3.85 4.4% ‐0.4% ‐20%
2015 ‐34.26 57.12 4.66 0.0% ‐18.2% 28%
2016 ‐66.80 15.36 4.93 0.8% ‐10.4% 61%
2017E 67.59 9.93 4.46 0.0% 9.9% 69%
2018E 33.83 7.85 3.75 0.0% 17.2% 55%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 4
Figure 1: MONO’s 4Q16 earnings result Profit and Loss (Btmn) Year‐end 31 Dec Revenue Gross profit EBITDA Interest expense Other income Income tax Extra‐items Gn (Ls) from affiliates Net profit (loss) Core profit (loss) Reported EPS (Bt) Gross margin (%) EBITDA margin (%) Net margin (%) Current ratio (x) Interest coverage (x) Debt / equity (x) BVPS (Bt) ROE (%)
4Q15 512 88 143 (104) (5) 11 0 0 (129) (129) (0.04) 17.2 27.8 (25.1) 0.8 (0.3) 0.3 0.8 (5.1)
3Q16 604 165 271 (36) 12 (2) 0 (2) 10 10 0.00 27.3 44.9 1.7 0.9 1.1 0.5 0.0 0.0
4Q16 395 1 130 (39) 12 (1) (46) 0 (193) (146) (0.06) 0.1 33.0 (37.0) 0.8 (3.0) 0.6 0.0 0.0
% YoY (22.9) (99.4) (8.6) (62.4) (324.5) (108.8) n.a. n.a. (49.8) (13.7) (33.8)
% QoQ (34.6) (99.7) (51.9) 7.7 (0.7) (51.8) n.a. n.a. (2,004) (1,544) (1,913)
2015 1,893 240 216 (133) 32 54 0 0 (487) (487) (0.16) 12.7 11.4 (25.7) 0.4 (3.3) 0.3 0.8 (18.2)
2016 2,077 443 802 (145) 36 (10) (46) (2) (250) (203) (0.08) 21.3 38.6 (12.0) 0.8 (0.6) 0.6 0.7 (10.4)
%YoY 9.7 84.3 271.8 9.0 11.7 (118.0) n.a. n.a. 48.7 58.3 50.3
Sources: MONO, KT Zmico Research REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 4
FINANCIAL TABLE PROFIT & LOSS (Btmn) Revenues Cost of sales and service Gross profit SG&A EBITDA Depreciation & amortization EBIT Interest expense Other income / exp. EBT Corporate tax Gain (loss) from affiliates Extra Items Non‐controlling Net profit Reported EPS Fully diluted EPS Core net profit Core EPS Dividend (Bt) BALANCE SHEET (Btmn) Cash and equivalents Accounts receivable Inventories Investment PP&E‐net Other assets Total assets ST debt & current portion Long‐term debt Total liabilities Paid‐up shares Shareholder equity Total liab. & shareholder equity CASH FLOW (Btmn) Net income Non‐cash adjustment Depreciation & amortization Change in working capital Cash flow from operations Capex (Invest)/Divest Others Cash flow from investing Debt financing (repayment) Equity financing Dividend payment Others Cash flow from financing Net change in cash Free cash flow FCF per share (Bt) PROFITABILITY Revenue growth (%) EBITDA growth (%) EPS growth (%) Gross margin (%) EBITDA margin (%) Operating margin (%) Net margin (%) Core profit margin (%) Effective tax rate (%)
2013 1,407 (582) 826 (373) 512 (59) 452 (3) 91 540 (39) 0 0 0 501 0.16 0.11 501 0.16 0.43
2014 1,526 (1,011) 515 (588) 217 (290) (73) (81) 77 (77) 64 0 0 0 (12) (0.00) (0.00) (12) (0.00) 0.16
2015 1,893 (1,653) 240 (680) 216 (655) (439) (133) 32 (540) 54 0 0 0 (487) (0.16) (0.11) (487) (0.16) 0.00
2016 2,077 (1,634) 443 (525) 802 (885) (83) (145) 36 (192) (10) (2) (46) 0 (250) (0.08) (0.05) (203) (0.08) 0.00
2013 2,277 416 7 0 582 105 3,386 17 15 293 140 3,093 3,386
2014 998 578 8 0 3,569 248 5,400 13 409 2,489 308 2,911 5,400
2015 195 554 10 0 4,154 365 5,278 146 734 2,854 310 2,424 5,278
2016 87 530 9 51 4,315 400 5,392 141 1,397 3,026 498 2,366 5,392
2017E 2,689 (1,656) 1,033 (588) 1,241 (796) 445 (168) 31 308 (62) 0 0 0 247 0.08 0.05 247 0.08 0.00
2018E 3,052 (1,682) 1,370 (607) 1,570 (808) 763 (178) 32 616 (123) 0 0 0 493 0.15 0.11 493 0.15 0.00
2017E 206 686 9 51 4,487 407 5,846 0 2,000 3,234 498 2,612 5,846
2018E 801 778 9 51 4,636 412 6,687 0 2,500 3,582 498 3,105 6,687
2013 501 6 59 (131) 436 (357) 0 (357) (21) 2,720 (585) 0 2,115 2,194 79 0.02
2014 (12) 12 290 (118) 171 (1,659) 0 (1,659) 384 0 (174) 0 210 (1,279) (1,488) (0.32)
2013 ‐8.5% ‐25.4% ‐31.9% 58.7% 36.4% 32.1% 35.6% 35.6% 7.2%
2015 (487) 33 655 (307) (105) (1,139) 0 (1,138) 441 52 (62) 0 432 (804) (1,244) (0.27)
2014 8.5% ‐57.6% ‐102.5% 33.8% 14.2% ‐4.8% ‐0.8% ‐0.8% 83.8%
2016 (250) 59 885 (430) 264 (1,042) (83) (1,125) 658 95 (0) 0 753 (107) (862) (0.19)
2015 24.0% ‐0.5% 3790.5% 12.7% 11.4% ‐23.2% ‐25.7% ‐25.7% 9.9%
2017E 247 0 796 (417) 625 (968) 0 (968) 462 0 0 0 462 119 (343) (0.07)
2016 9.7% 271.8% ‐50.3% 21.3% 38.6% ‐4.0% ‐12.0% ‐9.8% ‐5.0%
2018E 493 0 808 (250) 1,051 (956) 0 (956) 500 0 0 0 500 594 94 0.02
2017E 29.5% 54.7% ‐198.8% 38.4% 46.2% 16.6% 9.2% 9.2% 20.0%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 4
2018E 13.5% 26.5% 99.8% 44.9% 51.5% 25.0% 16.1% 16.1% 20.0%
Note: KT ZMICO has two major shareholders, Krungthai Bank PLC (KTB) and Seamico Securities PLC (ZMICO). Therefore, prior to making investments in the securities of KTB and ZMICO, investors should consider the risk factors carefully. An executive of KT ZMICO Securities is also a board member of BCP, BTC, CI, CPI, KBS, MAJOR, MK, PACE, PSL, SVH, VNG, ZMICO, SAWAD, TFG. A management member of KT ZMICO Securities is also a board member of BTC and NFC. KT ZMICO is a financial advisor for U, LOXLEY, ZMICO, MAKRO, CPALL, SAFARI, M‐CHAI, TFD. KT ZMICO is a co underwriter of RPH.
Corporate Governance Report (CGR) Source: Sec, Thai Institute of Directors Association (IOD)
Excellent (scores: 90 ‐ 100) Very Good (scores: 80 – 89) Good (scores: 70 – 79)
Satisfactory (scores: 60 – 69) Pass (scores: 50 – 59) No Logo N/A (scores: below 50)
Anti‐corruption Progress Indicator Source: Sec, Thailand's Private Sector Collective Action Coalition Against Corruption programme (Thai CAC)
Level 1 (Committed) : Organization’s statement or board's resolution to work against corruption and to be in compliance with all relevant laws. Level 2 (Declared) : Public declaration statement to participate in Thailand's private sector Collective Action Coalition Against Corruption (CAC) or equivalent initiatives Level 3 (Established) : Public out preventive measures, risk assessment, communication and training for all employees, including consistent monitoring and review processes Level 4 (Certified) : Audit engagement by audit committee or auditors approved by the office of SEC, and receiving certification or assurance by independent external assurance providers (CAC etc.) Level 5 (Extended) : Extension of the anti‐corruption policy to business partners in the supply chain, and disclosure of any current investigations, prosecutions or closed cases Insufficient or not clearly defined policy Data not available / no policy
DISCLAIMER This document is produced using open sources believed to be reliable. However, their accuracy and completeness cannot be guaranteed. The statements and opinions herein were formed after due and careful consideration for use as information for the purposes of investment. The opinions contained herein are subject to change without notice. This document is not, and should not be construed as, an offer or the solicitation of an offer to buy or sell any securities. The use of any information contained in this document shall be at the sole discretion and risk of the user.
KT ZMICO RESEARCH – RECOMMENDATION DEFINITIONS STOCK RECOMMENDATIONS
SECTOR RECOMMENDATIONS
BUY: Expecting positive total returns of 15% or more OVERWEIGHT: The industry, as defined by the analyst's over the next 12 months coverage universe, is expected to outperform the relevant OUTPERFORM: Expecting total returns between ‐10% primary market index by at least 10% over the next 12 months. to +15%; returns expected to exceed market returns NEUTRAL: The industry, as defined by the analyst's coverage over a six‐month period due to specific catalysts universe, is expected to perform in line with the relevant UNDERPERFORM: Expecting total returns between primary market index over the next 12 months. ‐10% to +15%; returns expected to be below market UNDERWEIGHT: The industry, as defined by the analyst's returns over a six‐month period due to specific coverage universe, is expected to underperform the relevant catalysts primary market index by 10% over the next 12 months. SELL: Expecting negative total returns of 10% or more over the next 12 months
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 4 of 4
KT ZMICO Securities Company Limited Head Office
WWW.KTZMICO.COM
8th, 15th‐17th,19th, 21st Floor, Liberty Square Bldg., 287 Silom Road, Bangrak, Bangkok, Thailand 10500 Telephone: (66‐2) 695‐5000 Fax: (66‐2) 695‐5173 KT ZMICO Connect 662 695 5555
Central World Branch
Amarin Branch
22nd Floor, Amarin Building, 496‐502 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 018‐6200 Fax: (66‐2) 018‐6298, (66‐2) 018‐6299
8th Floor, Ton Son Tower, 900 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 626‐6000 Fax: (66‐2) 626‐6111
Phaholyothin Branch
Sindhorn Branch
Viphavadee Branch
2nd Floor, Sindhorn Tower 1, 130‐132 Wireless Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 627‐3550 Fax: (66‐2) 627‐3582, 627‐3600
G Floor, Lao Peng Nguan 1 Bldg., 333 Soi Cheypuand, Viphavadee‐Rangsit Road, Ladyao, Jatujak, Bangkok 10900 Telephone: (66‐2) 013‐8600 Fax: (66‐2) 618‐8569
BangKhae Branch
Chiang Mai Branch
Pak Chong Branch
999/9 The Offices at Central World, 16th Fl., Rama 1 Rd, Pathumwan, Bangkok 10330 Telephone: (66‐2) 264‐5888 Fax: (66‐2) 264 5899
1291/1, Shinnawatra Tower II, 3rd Floor, Phaholyothin Road, Phayathai, Bangkok 10400 Telephone: (66‐2) 686‐1500 Fax: (66‐2) 686‐1666
Ploenchit Branch
518 The Mall Group Building Bangkhae Branch, 6th Floor, Petchkasem Road, North Bangkhae, Bangkhae, Bangkok 10160 Telephone: (66‐2) 454‐9979 Fax: (66‐2) 454‐9970
422/49 Changklan Road, Changklan Subdistrict, Amphoe Meuang, Chiang Mai 50100 Telephone: (053) 270‐072 Fax: (053) 272‐618
173 175, Mittapap Road, Nong Sarai, Pak Chong, Nakhon Ratchasima 30130 Telephone: (044) 279‐511 Fax: (044) 279‐574
Korat Branch
Khon Kaen Branch
Chonburi Branch
624/9 Changphuek Road, T.Naimaung, A.Maung, Nakhon Ratchasima 30000 Telephone: (044) 247222 Fax: (044) 247171
5th Floor, Charoen Thani Princess Hotel, 260 Srichan Road, T. Naimuang, A. Muang, Khon Kaen 40000 Telephone: (043) 389‐171‐193 Fax: (043) 389‐209
4th Floor, Forum Plaza Bldg., 870/52 Sukhumvit Road, T. Bangplasoy, A. Muang, Cholburi 20000 Telephone: (038) 287‐635 Fax: (038) 287‐637
Pattaya Branch
Chachoengsao Branch
Hat Yai Branch
Easy Point 2, 392/65 Moo.9, T.Nong Prue, A. Bang Lamung, Chonburi 20260 Telephone: (038) 420‐965 Fax: (038) 420‐968
108/34‐36 Mahajakkrapad Road, T.Namuang, A.Muang, Chachoengsao 24000 Telephone: (038) 813‐088 Fax: (038) 813‐099
200/301, 200/303 JULDIS HATYAI PLAZA Floor 3 , Niphat‐Uthit 3 Rd, Hatyai Songkhla 90110 Telephone: (074) 355530‐3 Fax: (074) 355534
Phuket Branch
22/61‐63, Luang Por Wat Chalong Road, Talat Yai, Mueang Phuket, Phuket 83000 Telephone: (076) 222‐811, (076) 222‐683 Fax: (076) 222‐861
Phitsanulok Branch
227/171 Borom Trilokkanat Road, Muang, Phitsanulok 65000 Telephone: 055‐219‐255 to 8 Fax: 055‐219‐259
Nakhon Pathom
Cyber Branch Ayutthaya
Cyber Branch @ North Nana
Cyber Branch Chiangrai
KrungThai Bank, Rojana Branch 253 Moo 5, Rojana Road, Phai Ling, Phra Nakhon Si Ayutthaya, Phra Nakhonsi Ayutthaya, 13000 Telephone: 035‐242‐477 Fax: 035‐242‐476
Krung Thai Bank PCL, 2 Floor, North Nana Branch 35 Sukhumvit Rd., Klong Toey Nua Subdistrict , Wattana District , Bangkok 10110 Telephone: 083‐490‐2871
River Hotel (Building 3rd),1156 Petchakasem Road, Sanamchan Subdistrict, Amphoe Meuang , Nakhon Pathom Province 73000 Telephone: (034) 271300 Fax: (034) 271300 #100
KrungThai Bank, Hayaek Phokhun Mengrai Branch 116/19 Moo 19, Highway 110 Road, Rop Wiang, Mueang Chiang Rai, Chiang Rai, 57000 Telephone: 053‐715‐067 Fax: 053‐715‐068
