Quarterly Meeting# 4/2018 3Q18 & 9M18 Performance & Outlook 14 November 2018 1 2016 ERAWAN. All rights reserved.
The views expressed here contain some information derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. Any forward looking information in this presentation has been prepared on the basis of a number of assumptions which may prove to be incorrect. This presentation should not be relied upon as a recommendation or forecast by The Erawan Group PLC. Nothing in this release should be construed as either an offer to sell or a solicitation of an offer to buy or sell shares in any jurisdiction. 2 2018 ERAWAN. All rights reserved.
3Q18 Executive Summary Industry Continue Growing but at lower pace Tourist arrivals increased by 3% yoy in 3 rd quarter The slower growth could be attributed largely to the decline in Chinese and Russian tourists. 3Q Low Season JW Marriott Renovation Recorded revenue 1,430 MB and net profit 41 MB Mainly from JW Renovation and the slow down of Chinese and Russian tourists. Hotel Development on Track 2 new hotels opened; Hop Inn Chonburi (Thailand) and Hop Inn Alabang (Philippines) JW Marriott room and F&B outlet renovation were completed 3 2018 ERAWAN. All rights reserved.
Agenda Industry Update Performance Review 3Q18 & 9M18 Outlook & Strategy Update Q & A Novotel & ibis Style Sukhumvit 4 4 2018 ERAWAN. All rights reserved.
International Tourist Arrivals Millions 4.0 YTD 28.5 millions, +9% y-y 2015 YTD 22.1 M 2016 YTD 24.8 M 2017 YTD 26.1 M 2018 YTD 28.5 M YoY 2018-2017 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 Jan Feb Mar Apr May June July Aug Sep Oct Oct Nov Nov Dec Dec +11% +19% +16% +9% +6% +12% +3% +3% +4% %YoY Source : Department of Tourism as of Sep-18 5 2018 ERAWAN. All rights reserved.
International Tourist Arrivals by Quarter Thailand Tourism Industry continues Growing 2015 2016 2017 2018 15% 10.6 7.8 9.0 9.2 7.0 7.6 9% 3% 8.9 9.1 8.8 8.1 8.2 7.3 7.8 7.8 9.3 Q1 Q2 Q3 Q4 Source : Department of Tourism as of Sep-18 6 2018 ERAWAN. All rights reserved.
International Tourist Arrivals by Source Markets Oceania The 2% Americas 4% South Asia 5% Europe 17% Middle East 2% Africa 1% 28.5 Million East Asia 69% Continent 3Q18 YoY 9M18 YoY East Asia 4% 12% Europe 1% 5% South Asia 7% 11% The Americas 2% 3% Oceania 3% 2% Middle East 2% 5% Africa 5% 7% Total 3% 9% 9M18 Contribution Source : Department of Tourism as of Sep-18 7 2018 ERAWAN. All rights reserved.
Thailand Tourist Arrivals 3Q17 Weight 3Q18 Weight YoY 9M17 Weight 9M18 Weight YoY China 31% 27% 9% 28% 29% 13% Malaysia 9% 12% 40% 10% 10% 15% South Korea 5% 5% - 5% 5% 5% Laos 5% 5% 4% 5% 5% 9% Japan 5% 5% 9% 4% 4% 7% India 4% 4% 8% 4% 4% 12% Russia 2% 2% 7% 3% 4% 14% Vietnam 3% 3% 10% 3% 3% 9% United States 2% 2% 3% 3% 3% 6% Hong Kong 3% 3% 28% 2% 3% 25% Other 32% 31% 1% 33% 31% 4% Grand Total 3% 9% Source : Department of Tourism as of Sep-18 8 2018 ERAWAN. All rights reserved.
Agenda Industry Update Performance Review 3Q18 & 9M18 Outlook & Strategy Update Q & A JW Marriott Bangkok 9 2018 ERAWAN. All rights reserved.
Statistic Summary 3Q18 & 9M18 (ex. HOP INN) No. of Rooms %OCC 84% 83% 85% 81 % 4,501 4,501 4,501 4,514 4,501 4,514 74% 76% 3Q15 3Q16 3Q17 3Q18 9M17 9M18 3Q15 3Q16 3Q17 3Q18 9M17 9M18 Average Room Rate (THB/Room) RevPAR (THB/Room) 5% 5% 4% 1% 2,354 2,323 2,421 2,548 2,520 2,649 1,750 1,954 2,020 1,942 2,136 2,149 3Q15 3Q16 3Q17 3Q18 9M17 9M18 3Q15 3Q16 3Q17 3Q18 9M17 9M18 10 2018 ERAWAN. All rights reserved.
Statistic Summary 3Q18 & 9M18 by Segment Segment OCC 3Q18 (YoY) ARR +/- RevPAR +/- OCC 9M18 (YoY) ARR +/- RevPAR +/- Thailand Luxury 67% 2% 8% 72% 5% 4% Midscale 86% 3% 2% 87% 6% 4% Economy 74% 12% 1% 82% 7% 3% Total Group 76% 5% 4% 81% 5% 1% HOP INN 73% 12% 9% 76% 8% 10% Philippines HOP INN 73% 14% 8% 75% 9% 4% Remark : calculation in THB 11 2018 ERAWAN. All rights reserved.
3Q18 & 9M18 Core Performance Summary Group Operating Income 3Q17 3Q18 9M17 9M18 3Q18 1% YoY 9M18 3% YoY 1,448 1,430 4,413 4,555 EBITDA 3Q18 16% YoY 9M18 in line YoY 422 353 1,336 1,337 Normalized Net Profit 3Q18 64% YoY 9M18 3% YoY 101 36 372 363 12 2018 ERAWAN. All rights reserved.
Hotel Revenue by Room & F&B 3% 3% (Unit in MB) 3Q18 1,373 MB 1% YoY 1,393 1,373 7% 1% 9M18 4,385 MB 3% YoY 4,249 4,385 13 2018 ERAWAN. All rights reserved.
Hotel Revenue Growth by Segment Luxury 4% 10% HOP INN Thailand 51% 3Q17 3Q18 9M17 9M18 44% Midscale 3% 3Q17 3Q18 9M17 9M18 1% HOP INN Philippines 149% 3Q17 3Q18 9M17 9M18 199% Economy 2% 3Q17 3Q18 9M17 9M18 3% 3Q17 3Q18 9M17 9M18 14 2018 ERAWAN. All rights reserved.
ERW Tourist Arrivals by Key Source Markets Key Source Markets 3Q17 Weight 3Q18 Weight YoY 9M17 Weight 9M18 Weight YoY 1. Thailand 17% 21% 23% 16% 19% 25% 2. China 16% 12% 20% 15% 14% 6% 3. United States 9% 8% 10% 10% 9% 3% 4. Singapore 6% 6% 1% 5% 6% 7% 5. India 4% 5% 16% 5% 5% 12% 6. Hong Kong 5% 5% 2% 4% 4% 3% 7. Russia 2% 1% 42% 3% 4% 15% 8. Australia 3% 3% 1% 3% 3% 8% 9. Germany 3% 2% 7% 3% 3% 5% 10. South Korea 3% 3% 5% 3% 3% 8% Other 32% 32% 1% 32% 30% 1% Total - 4% Source : Department of Tourism as of Sep-18 15 2018 ERAWAN. All rights reserved.
Consolidate Profit & Loss Statement In Baht Millions 3Q17 3Q18 %YoY 9M17 9M18 %YoY Hotel Operating Income 1,393 1,373 1% 4,249 4,385 3% Rental and Service Income 55 57 3% 164 170 4% Total Operating Income 1,448 1,430 1% 4,413 4,555 3% Other Income 10 12 24% 40 35 13% Total Income 1,458 1,442 1% 4,453 4,590 3% Operating Expenses (1,036) (1,089) 5% (3,117) (3,253) 4% EBITDA 422 353 16% 1,336 1,337 0% Depreciation & Amortization (188) (194) (550) (565) Finance Costs (88) (91) (255) (262) Taxes (34) (22) (120) (110) Minority Interest (11) (10) (39) (37) Normalized Net Profit / (Loss) 101 36 64% 372 363 3% Extraordinary Items Share of Profit/(Loss) from ERWPF (22) 5 N.M. (28) (6) 78% Net Profit / (Loss) 79 41 48% 344 357 4% EBITDA Margin 29.0% 24.5% 4.5% 30.0% 29.1% 0.9% 16 2018 ERAWAN. All rights reserved.
Summary of Financial Position Total Assets Total Interest Bearing Debt (MB) & Interest-bearing Debt to Equity (x) 10,000 2.0 16,048 16,674 2017 3Q18 Total Liabilities 9,000 8,000 7,000 6,000 1.7 1.7 1.7 1.7 1.8 1.8 1.6 1.4 1.2 10,645 11,207 5,000 2014 2015 2016 2017 3Q18 1.0 2017 3Q18 Total Equities 5,403 5,467 Average Cost of Debt (%) 6.00% 5.00% 4.00% 4.11% 2017 3Q18 3.00% 2014 2015 2016 2017 3Q18 17 2018 ERAWAN. All rights reserved.
Agenda Industry Update Performance Review 3Q18 & 9M18 Outlook & Strategy Update Q & A The Naka Island, a Luxury Collection Resort and Spa, Phuket 18 2018 ERAWAN. All rights reserved.
2018 Outlook Revised 2018 Outlook on RevPAR Growth and Revenue growth due to Slowdown of Chinese Tourists in 2H18 Hotel Revenue Growth Quality Portfolio Operation Excellence RevPAR Growth (ex. HOP INN) 5% - 6% 1% - 2% 19 2018 ERAWAN. All rights reserved.
Hotels Growth Strategy HOP INN Thailand #33 Krabi 2 71 Rooms 1Q18 HOP INN Philippines #3 Aseana 196 Rooms HOP INN Thailand #34 Surin 79 Rooms HOP INN Philippines #4 Alabang 168 Rooms HOP INN Thailand #35 Chonburi 79 Rooms 2Q18 3Q18 Novotel Sukhumvit 4 Ibis Style Sukhumvit 4 HOP INN Thailand #36 Chiang Mai 2 HOP INN Philippines #5 Tomas Morato (Quezon City) 185 Rooms 133 Rooms 79 Rooms 167 Rooms 4Q18 Return Enhancing Strategy JW Marriott Room Renovation 2 nd Phase 178 Rooms 2Q18-3Q18 JW Marriott F&B Outlet renovation JW Cafe & BBCO 3Q18 20 2018 ERAWAN. All rights reserved.
2018 Thailand Hotels Non Bangkok 10 Existing Hotels 35 Existing Hotels 1 New Hotel in 4Q18 Bangkok 8 Existing Hotels 2 New Hotels in 4Q18 21 56 Hotels in Thailand by 2018
2018 Philippines Hotels Manila 4 Existing Hotels 1 New Hotels in 4Q18 22 5 Hotels in Philippines by 2018
Updated Hotel Development Pipeline 1,781 rooms in pipeline 7,921 rooms Existing 564 rooms opened in 4Q18 HOP INN & Midscale Philippines 628 Rooms 1,781 Rooms Midscale and Economy Thailand 501 Rooms 23 2018 ERAWAN. All rights reserved. HOP INN Thailand 652 Rooms Both existing and pipeline > 10,000 rooms
2019 New Hotels Hotel development as planed, with additional approximately 1,074 rooms 2018 61 Hotels 8,485 Rooms 1 1 7 70 Hotels 9,559 Rooms (Approx.) 2019 24 2018 ERAWAN. All rights reserved.
Midscale & Economy Development Plan Location No. of Rooms No. of Floor Sukhumvit 4 Bangkok Novotel 185 Rooms ibis style 133 Rooms 26 Floors Opening Date 1 Oct 2018 25 2018 ERAWAN. All rights reserved.
Agenda Industry Updates Performance Review 3Q18 & 9M18 Outlook & Strategy Update Q & A Holiday Inn Pattaya 26 2018 ERAWAN. All rights reserved.
27 2018 ERAWAN. All rights reserved. Success with Integrity
28 2018 ERAWAN. All rights reserved. Appendix 3Q18 & 9M18 Review
3Q18 Hotel Statistic by Segment Hotel Properties Rooms Occupancy ARR (Bt/room/night) RevPAR (Bt/room/night) YoY 3Q17 3Q18 3Q17 3Q18 +/- LY 3Q17 3Q18 +/- LY 3Q17 3Q18 +/- LY Thailand Luxury 966 979 74% 67% -7% 5,578 5,663 +2% 4,131 3,812-8% Midscale 1,282 1,282 90% 86% -4% 2,698 2,773 +3% 2,429 2,389-2% Economy 2,253 2,253 84% 74% -9% 1,054 1,176 +12% 882 875-1% Total Group ex.hop INN 4,501 4,514 83% 76% -7% 2,421 2,548 +5% 2,020 1,942-4% HOP INN Thailand 2,186 2,731 75% 73% -2% 519 580 +12% 388 424 +9% Philippines HOP INN Philippines 312 676 77% 73% -4% 870 989 +14% 670 721 +8% 29 2018 ERAWAN. All rights reserved.
9M18 Hotel Statistic by Segment Hotel Properties Rooms Occupancy ARR (Bt/room/night) RevPAR (Bt/room/night) YoY 9M17 9M18 9M17 9M18 +/- LY 9M17 9M18 +/- LY 9M17 9M18 +/- LY Thailand Luxury 966 979 79% 72% -7% 5,560 5,853 +5% 4,379 4,220-4% Midscale 1,282 1,282 89% 87% -2% 2,719 2,886 +6% 2,430 2,518 +4% Economy 2,253 2,253 85% 82% -3% 1,189 1,274 +7% 1,007 1,039 +3% Total Group ex.hop INN 4,501 4,514 85% 81% -4% 2,520 2,649 +5% 2,136 2,149 +1% HOP INN Thailand 2,186 2,731 74% 76% +2% 537 578 +8% 397 437 +10% Philippines HOP INN Philippines 312 676 79% 75% -4% 886 968 +9% 696 726 +4% 30 2018 ERAWAN. All rights reserved.
Operating Income by Segment 3Q18 9M18 Contribution Y-Y Contribution Y-Y Luxury 44% 10% 45% 4% Midscale 25% 1% 25% 3% Economy 15% 3% 17% 2% HOP INN Thailand 7% 44% 7% 51% HOP INN Philippines 3% 199% 2% 149% Rental 4% 3% 4% 4% Total Group 1% 3% 31 2018 ERAWAN. All rights reserved.
EBITDA by Segment 3Q18 Note : For illustration purpose only EBITDA by Segment is calculated without taking non-property-specific expenses into account. 9M18 Contribution Y-Y Contribution Y-Y Luxury 33% 33% 37% 14% Midscale 32% 1% 30% 5% Economy 13% 17% 18% 3% HOP INN Thailand 11% 76% 9% 69% HOP INN Philippines 4% 950% 2% 558% Rental 7% 2% 6% 6% Total Group 16% - 32 2018 ERAWAN. All rights reserved.
33 2017 ERAWAN. All rights reserved. Success with Integrity