dusit thani plc. analyst meeting - dtc.listedcompany.com
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Determined Vision Mission and Value
3
Proud of our Thai heritage,
uniquely delivering gracious hospitality
to the world.
We empowerour people to
exceed expectations. ALWAYS.
Care, Commit, Can do!
MissionVision
Value
DTC by numbers
4
Focused on hospitality and hospitality education business
* Dusit Thani Laguna Phuket, dusitD2 Chiang Mai and the leasehold of Dusit Thani Hua Hin are under Dusit Thani Freehold and Leasehold Real Estate Investment Trust (DREIT) ofwhich DTC holds a 30.02% stake.
As of 31 March 2018
Years in hospitality business
Countries
70
Properties in operation
Owned hotels
Management contracts & franchise
Management contracts in pipeline
27*
9
18
64
8
Years in hospitality education business 24
Brand Portfolio
Franchise contracts with Dossen40
Company structure
5As of 31 March 2018
0.55%
99.99%
Dusit ThaniProperties
Co., Ltd.
Dusit Management Co., Ltd.
99.99%
DMS Property Investment Private Limited
65.00%
88.01%
Philippine Hoteliers, Inc.
84.05%
Dusit Thai Properties Plc.
100%
Philippine Hoteliers International Center for Hospitality Education, Inc.
40%
Dusit Excellence Co., Ltd.
99.99%
Le Cordon Bleu Dusit Co., Ltd.
49.99%
Dusit ThaniCollege
VimarnsuriyaCo., Ltd.
65.00%
Saladaeng Property Management Co., Ltd.
Suanlum Property Co., Ltd.
Pharam 4 Development
Co., Ltd.
10.00%
25.00%
37.00%
Devarana Spa Co., Ltd.
Dusit ThaniProperties REIT Co., Ltd.
Dusit Thani Freehold and Leasehold Investment Trust (DREIT)
30.02%
Favstay
Pte. Ltd.
9.24%
99.99%2.75%
100%
Dusit USA Management Inc.
99.99%
Dusit Worldwide Co.,Ltd.
100%
Dusit Overseas Co.,Ltd.
Dusit Saudi LLC
51.00%
Dusit China Capital Co., Ltd.
99.99%
Dusit Fudu Hotel
Management (Shanghai) Co., Ltd.
45.00%
Dusit Colours Co., Ltd.
49.00%
ASAI Holdings Co., Ltd.
99.70%
99.99%
Hotel Business
Managed Hotel Owned Hotel
Education Business Mixed-Use Project Other Business
Dusit Thani Plc. (DTC)
99.7%
Food
Dusit Food Co., Ltd.
NR Instant Produce Co., Ltd
25.977%
Business structure
6
DTC
Hotel business
Owned
Managed
Education business
Mixed-use Project
Hotel
Residence
Office Building
Retail
Food
Food OEM
Others
REIT
Office Building
favstay
As of 31 March 2018
Revenue contribution
7
Hotel82%
Education8%
Others10%
2017Total Revenue
Remark: REIT data is included in hotel businessOthers = Realized income from deferred rental revenue, gain on sales of assets, interest income, dividend income, share of profit from investment by equity method, office rental income,and other incomes
THB 5,570mn
Owned hotel revenue
Hotel key statistics
8
-3.5% -2.0%
Ow
ne
d H
ote
l Sta
tist
ic
Remark: * Including Dusit Princess Korat (The hotel was divested at the end of December 2017)
56%44%
59%41%
62%38%
2017: 28 properties*
in 8 countries
Stagnant performance …
9
+19.6% +134.0%
* Remark: Including THB 325 mn gain on sales of assets (Dusit Princess Korat)
+2.7%
*
… but with financial flexibility for future growth
10
* Remark: Dividend per share in 2015 was revised retroactively to reflect the Company’s par value change from THB 10 to THB 1 since May 2015.
Net interest beating debt (Net IBD) = Total interest bearing debt - Cash & Cash equivalents including short term investmentMaintaining BBB+ Company rating and stable outlook by TRIS Rating
+58.0%
Average finance cost ~ 4% p.a.
DTC’s key challenges
11
Concentrated Portfolio
Aging Properties
F&B Trend
Industry Shift
Rely heavily
on domestic
market
Challenging for
raising ADR
&
Need more
renovation CAPEX
Customers
look for local
experience
Shift from
full service to
boutique/ lifestyle
hotel and shared
economy
Strategic direction
13
With strong background in the hotel management and education business over six decades, DTC isnow entering into the new chapter with multi-year plan under “Balance, Diversify, and Expand”strategy…
BALANCE • 50:50 domestic: overseas revenue with balancing ofasset light vs capital investment
DIVERSIFY • 10% contribution from new adjacent business
EXPAND • Double number of rooms in operationfrom 7,000 to 14,000 keys in 2021
Long term target
ProcessPeople PropertiesTechnology Financial Capability
… by strengthening key 5 pillar foundations
Moving towards strategic direction
14
BALANCE
DIVERSIFY
EXPAND
• Geographic• Capital investment
• Resilient portfolio• Financial driven
• Brand awareness
Capital investment focusing UK, Japan, Australia markets
Objectives
Non-hotel: Food, real estate,
wellness
Hotel portfolio
(Invest/ Lease/ Managed)
Key challenges
2018 Guidance
16
• Core Revenue growth +5% driven by RevPar
• Core EBITDA margin ~ 15%
• New managed properties 10+ (1,800+ rooms)
• CAPEX THB 925 mn*
355** Hotel renovation (Maldives, Pattaya and Srinakarin)
Renovation of Dusit Thani College
Investment in IT system and software & Head office relocation
* Excluding new investment ** Excluding hotel renovation under DREIT
270 Mixed-use project (Demolition & Design development)
300 New owned property (ASAI brand)
Hotel portfolio
18Remark: As of 31 March 2018
OverseasThailand
Man
age
dO
wn
ed
Bangkok (Silom)
Pattya
Hua Hin*
Laguna Phuket*
Chiang Mai
Bangkok (Srinakarin)Chiang Mai*
Dusit Thani Krabi
Pathumwan Princess
Royal Princess Larn Luang
Dusit Island Chiang Rai
dusitD2 Khao Yai
Manila
Maldives
Constance Pasadena (USA)
Nairobi (Kenya)
Kenz Dubai (UAE)
Fudu Binhu (Changzhou, China)Guam (USA)Dubai (UAE)
Lakeview Cairo (Egypt)Abu Dhabi (UAE)
Dongtai (Jiangsu, China)Fudu Qingfeng (Changzhou, China)
Dusit Residence Dubai Marina (UAE)
Conghua (Guangzhou, China)
Panzhihua (Sichuan, China)
2018 opening target
20
8,967 rooms
5
2
1
1
11
China
Vietnam
Singapore
Bhutan
Philippines
Bahrain
Plan to add 10+ properties and 1,800+ rooms in 4 new countries via asset-light model.
38 properties
2018F
12 countries
Remark: As of 31 March 2018
More expansion in Asia pacific and Middle East …
21
3Q18: Thimphu, Bhutan (83 rooms) 4Q18: Vung Tau, Vietnam (100 rooms)
4Q18: Manila, Philippines (125 rooms)
dusitD2 The Fort, Manila, Philippines
4Q18: Singapore (208 rooms) 4Q18: Bahrain (174 rooms)
2Q18: Phu Quoc, Vietnam (108 rooms)
… as well as in China
22
Heritage Villas Zhouzhuang, Jiangsu
dusitD2 Society Hill, Tianjin Dusit Thani Shuangyue Bay Resort Huizhou GuangdongDusit Thani Wetland Park Resort, Nanjing Jiangsu
3Q18: Tianjin, China (400 rooms) 3Q18: Jiangsu, China (55 rooms) 3Q18: Guangdong, China (350 rooms)
4Q18: Fujian, China (177 rooms)
Dusit Princess Fuzhou, Fujian
3Q18: Jiangsu, China (33 rooms)
*
**
****
*
*
Well established brand positioning in Asia, Middle East and Africa with balanced portfolio of city and resort properties.
Growing global presence
23As of 31 March 2018* = In operation
Coverage will increase from 8 countries to 20+ countries and from 7,154 rooms to 20,000+ rooms
New brand launch
24
A distinctive new brand designed to link curious, millennial-minded travelers with authentic local experiences in vibrant cities and resort destinations worldwide.
DTC’s Hotel spectrum
25Remark: Invested in favstay as Venture Capital
= Future plan
EXPERIENCELIMITED SERVICEFULL SERVICE
Bespoke/ Luxury Midscale Economy Budget
Lifestyle/Boutique
Branded Residence
Shared Economy
Cruise/Vacation Club
26
Developing a unique hotel concept that is missing in the market
Leverage the strengths of Dusit International and
resonate with a new target segment with high growth.
Target the Millennials and those who share their
mindset are thirsty for discovery, interaction and ways
to make meaningful impact.
83% of business travelers are blending business and leisure, and seeking new types of experience
from their hotels (Source: Sabre)
“Making over million trips per year, Millennials alone account for of international tourist
arrivals and this figure is expected to rise to nearly 300 million by 2020” (Source: World Tourism
Organization)
190 20%
Expansion strategy
31
• 6 projects under development with focus on asset-light expansion
• Rooms count: 1,000 to date (April 2018)
• Target to open in vibrant cities and resort destinations with emphasis on local neighbourhood
• Potential markets: SEA, Japan and Europe
• Plan to acquire 10 projects each year
Th
aila
nd
Sin
ga
po
re
Ph
ilip
pin
es
Au
str
alia
* *
Sri
La
nka
DTC’s Hospital education landscape
33
As of March 2018
* = In operations1 = Management contract2 = LOI signed3 = MOU signed
Aca
dem
yC
erti
fy B
od
yR
esea
rch
&
Co
nsu
lt
Thailand ASEANAsia & Middle
EastRecognition Level
Serv
ice
Off
eri
ng
Hospitality School
Tourism and Hospitality
Institute
DTEC
dusitD2 the
Fort, ManilaDusit Thani
College
LCBD
Offer full range of hospitality program: Formal education (degree program), Professional class (short course/ executive course), and Management contract.
Omega
Global2 SIM3
Dusit
Thani
CollegeDTECLCBD
LPU1
dusitD2 the
Fort, Manila
In-progress education business repositioning
Set up “Dusit Thani Excellence Center” (DTEC) to develop the flagship academic curriculums.
34
• Optimize Thai operations• Launch e-Learning platform• Synergize with hotel operations
Short-term plan
• Develop right partnerships• Grow products and experiences• Scale effectively
Long-term plan
Academic research and curriculum
development center
Food research and
recipe development
center
Center for non-degree education
and services
• Short-term programs • Customized corporate programs for cabin crews,
hospitality services • Consultancy services for SMEs
and culinary schools in ASEAN
Rebranding exercise has been done in 2017 to strengthen Dusit’sbrand positioning and external communication to connect Dusit’shospitality education business to target markets (students and industry).
LCBD will be relocated in 4Q18
35
Le Cordon Bleu – Dusit Culinary School (LCBD)
Established in 2007 as a joint venture with the famed culinary school Le Cordon Bleu (49.99%) offering professional programs in French cuisine, Thai cuisine, Bakery and Wine Studies.
LCBD will be relocated its school to Central World in 4Q18 due to DTC’s plan to demolish Dusit Thani Building early next year.
Mixed-use project
37
Grade A Office Building
• Offer a lot of convenient facilities
• Perfectly serve all office employee’s needs
• Fully equipped with functions for intelligent building
Green Space
within the Project• Greenery garden at the
rooftop connected with every buildings
• Open space for any activities
Dusit Thani Bangkok Hotel
• Iconic flagship hotel• Luxurious 5-star hotel• Digital technology and
modern style with international standard
World’s Class Retail Shopping Center
• Enjoy shopping Thai and world’s class brands
• Center of prestige restaurants
• Variety of entertainments
Premium Residence
• Luxurious condominium• Delicate details• Refresh and relax with
greenery garden rooftop and swimming pool
Photo credit: Aedas
Project progress
38
Currently under the stage of demolishing the office and commercial building on the extended land adjacent to Dusit Thani Building and the parking area of Dusit Thani Bangkok Hotel.
2018 is a year of developing design concept and attaining construction permit.
Hotel Residence Retail Office
Sep 2022 Nov 2023 May 2023 Jun 2023Target Opening
Food value chain
40
Food Value Chain
Aggregator
Logistic
Production
Farming/R&D/ Genetic
ProcessingDistributor
Wholesale/Retail
Restaurant/Home
Delivery/Catering
Waste Recovery
NR Instant Produce (NRIP)
42
Engages in the business of production and export of ready-made food which have been accepted by both domestic and international markets as a standard manufacturer of instant products.
-0.8%
+32.0%
Source: NRIP Remark: 1 Jan-2 Oct 2017 audited figures and 2 Oct-31 Dec 2017 management report
Source: NRIP and DTC
NRIP Products
43
Recipe Mix:
Red curry paste, green curry paste, beef flavor sauce
Ready to Eat:
Pad-Thai noodle, satay noodle, udon noodle, etc.
Seasoning Mix Powder:
Cooking sauce, fish sauce, soy sauce, etc.
Dipping Sauce:
Sweet chili sauce, plum sauce, dipping sauce, etc.
Drink and Juice:
Thai tea powder, green tea powder, etc.
Owned Brands
OEM Customers
Source: NRIP and DTC
Investment rationale
44
STANDARDIZE
HOTEL F&Band benefit from
cost efficiency then create DIY and gift set opportunities
DIVERSIFY
DUSIT BRAND Promote Dusit brand in retail and diversify
into food sector
RIDE THE FOOD
TECHEnjoy rapid growth
from meatless protein and other
products
LINK TO
CULINARY with Dusit education
business, create food science & food
tech education opportunity
45
“Clear Path to Grow” Dusit Foods was set up to focus on any food related
investment going forward
26% profit from bottom-line consolidated into DTC
Strong growth potential in NRIP’s existing business
Dusit Brand Expansion Standardized hotel F&B, support Dusit owned hotels
worldwide
To develop a line of Dusit-branded, premium products for local and international markets
Enhance brand recognition worldwide
Existing Shareholders
Dusit Foods
NRIP74.023% 25.977%
Post Acquisition Structure
DTC
99.7%
What’s in it for DTC?
DTC’s Investment value = THB 663 mn
DREIT: IPO on 15 December 2017
47
This successful transformation of DTCPF to DREIT will help Increasing DTC group’s financial capability which is a part of the company 5 foundations. Current assets under DREIT are DusitThani Laguna Phuket, dusitD2 Chiang Mai and the leasehold of Dusit Thani Hua Hin.
48
• DTC invested 9.24% in favstay since April 2017 (USD 1 mn).
• favstay continues growing according to plan and target to raise series B funding by 2019.
+46%
+149%
Source: favstay and DTC
Fulfil DTC’s strategy positioning in shared economy
Thank you
49
Dusit Thani Maldives
IR Contact: ir@dusit.com +66 (0) 2200 9999 Ext. 3676www.dusit.com
Dusit Gold www.dusit.com
50
Disclaimer
The material contained in this document has been prepared by Dusit Thani Public Company Limited (“DTC”) and may containforward looking statements which includes but not limited to statements regarding our intent, belief, current expectation inrespect of DTC’s business, operation, market researches, results of operation and financial conditions, capital adequacy, specificprovisions and risk management practices.
While due care has been used in the preparation of forward looking statements, the assumptions of the information are subjectto various risk and uncertainties which the actual results may vary in a materially positive or negative manner differently fromthe anticipation. And no assurance that the past performance is a reliable indication of future performance.
Therefore, the information regarding forward looking statements shall not be considered as recommendation or advice toinvestors or potential investors in relation to hold, purchase, or sell securities. In this respect, DTC reserves the right not to beresponsible and expressly disclaims all liabilities for, damages of any kind arising out of use, reference to, or reliance on anyinformation contained herein.
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