Minor International Public Company Limited


Minor International ("MINT") reported 9M14 net profit of Baht 2,783 million, an increase of 9% from 9M13 net profit of Baht 2,545 million, as a result of improved performance of its core hospitality and restaurant businesses, despite the sluggish macro backdrop in Thailand, which was principally influenced by political events through 9M14. For the third quarter 2014, MINT's net profit rose by 6% to Baht 746 million from net profit of Baht 707 million recorded in the same period of last year, attributable to improved performance of MINT's hospitality, restaurant and retail trading businesses. The Company's international expansion and diversification strategy have bolstered the firm's resilience to domestic disruption. MINT also remains confident in the outlook of the fourth quarter high-season and 2015, considering potential rebound in Thai tourist arrivals and domestic consumption that may arise from Thailand's mellowing political climate and materialization of government stimulus policies.

In 9M14, net profit of MINT's hospitality business increased by 16%. The increase was driven largely by overseas hotels and non-Bangkok Thai hotels, both of which offset weaker performance of hotel properties in Bangkok. Revenue per available room (RevPar) of MINT's hotel portfolio increased by 4% year-on-year in 9M14. Excluding hotels in Bangkok, the year-on-year increase in RevPar was 12%. Hotels in Thailand's major tourist destinations outside of Bangkok saw RevPar hold up well with the monthly trend improving throughout the third quarter. Hotels outside Thailand, the majority of which are Anantara hotels, recorded RevPar growth of 39% year-on-year as a result of higher occupancies and ADR's, both in existing properties and new openings. In 3Q14, net profit of MINT's hospitality business increased by 8%, despite the ongoing refurbishment of Anantara Riverside, the temporary closure of Royal Garden Plaza Bangkok and the renovation of Anantara Hua Hin and AVANI Quy Nhon. Although Bangkok properties continued to experience the after-effects of earlier political disruptions, their monthly performance improved throughout the quarter. Likewise, the enhanced performance of Oaks contributed to the growth of net profit during 3Q14. MINT expects the hospitality business to witness stronger performance in the coming high-season 4Q14, with the continued momentum from Company-owned hotels, managed hotels and expansion plans.

In 9M14, MINT's restaurant business saw its net profit improve by 3% on the back of 11.9% increase in system-wide sales, thanks to its leading market position, its pro-active marketing and promotional efforts and its enhanced cost control measures. Comparable sales growth, which was under pressure during the political events in 1Q14, turned positive in 2Q14 and remained positive at 1.2% in 3Q14. In 3Q14, MINT's restaurant business weathered the slowdown in the Thai and Singaporean economy, with its net profit increasing by 1% from the same period last year. MINT expects the improving economic backdrop from the government's stimulus policies to propel its Thai comparable sales growth to a more normalized level in 4Q14 and in 2015. This, coupled with disciplined outlet expansion, should result in stronger total revenue growth and afford MINT the benefit of higher operating leverage in quarters to come.

In 9M14, net profit of retail trading declined by 8% from the same period last year due to the softening of discretionary spending that resulted from decline in tourist arrivals and high household debt. Nonetheless, net profit of retail trading rose by 28% in 3Q14 on the back of effective cost control, including the reduction of discounts. The outlook of the sector is expected to improve in tandem with the economic recovery and rebound in tourist arrivals.

About Minor International: MINT is a global company focused on three primary businesses including restaurants, hotels and lifestyle brands distribution. MINT is one of Asia's largest restaurant companies with over 1,600 outlets operating system-wide in 21 countries under The Pizza Company, Swensen's, Sizzler, Dairy Queen, Burger King, Thai Express, The Coffee Club, Ribs and Rumps and Riverside brands. MINT is also a hotel owner, operator and investor with a portfolio of 119 hotels and serviced suites under the Anantara, AVANI, Oaks, Per AQUUM, Elewana, Marriott, Four Seasons, St. Regis, Radisson Blu and Minor International brands in Thailand, Australia, New Zealand, Maldives, Vietnam, Tanzania, Kenya, the Middle East, Sri Lanka, China, Malaysia, Indonesia, Cambodia, Zambia, Botswana, Namibia, Swaziland, Lesotho and Mozambique. MINT is one of Thailand's largest distributors of lifestyle brands focusing primarily on fashion, cosmetics and contract manufacturing. Its brands include Gap, Esprit, Bossini, Charles & Keith, Pedro, Red Earth, Tumi, Zwilling J.A. Henckels, ETL Learning and Mysale. For more information, please visit www.minorinternational.com


3Q14 3Q13 % Change 9M14 9M13 % Change
Total Revenues 9,418 8,954 5% 29,172   26,842 9%
Cost of Sales 3,583 3,320 8% 10,676 9,720 10%
Selling & Administrative 4,002 3,943 1% 12,420   11,517 8%
EBITDA 1,834 1,691 8% 6,076 5,605 8%
Depreciation & Amort. 720 612 18% 2,057 1,764 17%
EBIT 1,114 1,079 3% 4,018 3,841 5%
Interest Expenses 317 251 26% 858 785 9%
Earnings Before Tax 798 828 -4% 3,160 3,056 3%
Corporate Tax 15 100 -85% 299 459 -35%
Minority Interest 37 21 78% 78 52 50%
Net Profit as Reported 746 707 6% 2,783 2,545 9%
Fully Diluted EPS as Reported (Bt)   0.1865   0.1771 5% 0.6955   0.6504 7%
Fully Diluted Shares (mn) 4,002 3,992 0% 4,002 3,913 0%

Note: Share of profit is included in other revenues