ThaiBev 1H17

Total sales revenue dropped by 8.4% to Baht 97,176 million. This is due to the decline in domestic consumption during mourning period. There is slight drop in net profit, the cost control lessen the effect of the mourning period to the bottom line, there is a decrease of 1.8% of net profit to Baht 14,322 million.

Beer sales revenue for 1st Half 2017 has decreased by 9.6% to 30,560 from 33,796. Non-alcoholic Beverages decreased by 2.3% from 8,373 to 8,181. Food has increased by 3% from 3,187 to 3,283. The beer revenue declined by 19.2% which is due to slowdown in ASEAN growth and International Spirits revenue declined by 22.3% due to weak sterling and Chinese spirits sales. Overall, growth is stalled.

Net interest bearing debt decreased from 41,026 in 30 Sep 16 to 38,640 in 31 Mar 17. Net Cash Flow from Operating Activities has decreased from 20,697,748 to 14,371,641. PPE increased and Free Cash Flow is still positive but decreased. Total cash equivalent 2,499,023 including 2018 cash flow from Operation and Financing if required should be able to cover for the 26,129 due by Mar 2018. Debt to Equity ratio for 31 Mar 17 has decreased to 0.48, if this can be decreased to 0.4 by end of the year will be good.

I believe the sales will pick up for 2H 2017. My intrinsic value for ThaiBev is at SGD 0.80, I will acquire near SGD 0.83-0.84. I need to acquire another 200k shares for this counter over the years.