Key Takeaways/ Results Preview 13 Jun 2016

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BUY

2016 TP: Bt48.00

Closing price: Bt39.50 Upside/downside: +22%

Sector Media & Publishing

Paid-up shares (shares mn) 417.23

Market capitalization (Bt bn) 16.48

Free float (%) 33.75

12-mth daily avg. turnover (Bt mn) 24.34

12-mth trading range (Bt) 47.25/30.50

Major shareholders (%)

Prapas Cholsaranon 27.51

Phanya Nirunkul 27.39

Mindo Asia Investments 10.74

Thai NVDR Co., Ltd. 4.97

Dentsu Media (Thailand) 3.00

Thailand Research Department

Ms. Sukanya Leelarwerachai

License, No. 68790

Workpoint Entertainment PCL. (WORK)

So far so good despite industry slowdown

► Analyst meeting on 10 Jun 2016.

► 2Q16 earnings expected to rise QoQ and YoY driven by solid

TV rating.

► Maintain BUY recommendation with 2016 TP of Bt48.00.

2Q16 earnings expected to rise both QoQ and YoY

Despite the second quarter normally being the high season for

advertising spending, the gloomy outlook for the advertising

industry is still an overhang. However, WORK seems to continue

to do well with improvements in revenue and earnings YoY. During

2Q16, the company successfully adjusted its average ad rate up to

Bt49,000/min from Bt34,000/min in 2Q15, up 44% YoY, while

utilization rate of ad time on Workpoint TV should reach 80%, down

from 82% in 2Q15. Additionally, ratings on WORK’s top rated TV

programs in 1H16, such as I Can See Your Voice and Mai Tong

Kum Dek, continue to improve which gives the company the

flexibility to adjust ad rates as these are not included in bundle

packages. Meanwhile, broadcasting the FIVB volleyball

tournament during May further boosted its average TV rating to a

record high 1.42, up from 1.19 in the prior month. We expect

operating revenue to rise 49% QoQ and 20% YoY, driven by the

increased ad rate for its digital TV business. Dinosaur Planet

located at EM District Bangkok, which the company invested 30%

of the total project cost, has also been well received. WORK is

expected to book ~Bt15mn in profit sharing from this project in this

quarter. As a result, we forecast 2Q16 earnings of Bt101mn, up

251% QoQ and 7% YoY.

Continued improvement in content in 2H16

This year WORK will reap the benefits of its investment in digital

TV supported by strength to strength on Workpoint TV’s ratings. In

the second half, WORK will continue to improve and add new

content such as Thailand Debate, GOAL Reality Football which is

a branded TV contents and King of Mask Singer, which is a foreign

format. The company plans to expand the broadcast time for Thai

drama series from only Mon-Tue to Thu-Fri and also sell some

content to LINE TV to further boost revenue from online media.

Maintain BUY with 16TP of Bt48.00

WORK is still our top pick in digital TV as it is reaping the benefits

of its investment, first year’s ratings together with nonstop

innovation to improve content and diversify risk on operating

revenue. We maintain a BUY recommendation with 16TP of

Bt48.00, derived from the DCF method (WACC 10.2%, Terminal

growth 2%).

Financial Highlights

(Year to Dec) 2014 2015 2016E 2017E

Revenue (Btmn) 2,053 2,388 3,022 3,405

Net Profit (Btmn) (16) 164 372 427

EPS (Bt) (0.04) 0.39 0.89 1.02

EPS Growth (%) -104% 1122% 128% 15%

P/E (x) n.a. 95.6 42.0 36.7

P/BV (x) 7.6 5.6 5.3 5.1

DPS (Bt) 0.44 0.34 0.59 0.68

Div. Yield (%) 1% 1% 2% 2%

ROE (%) -1% 6% 13% 14%

Source: SET, AWS estimates

Key Takeaways/ Results Preview 13 Jun 2016

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Figure 2: TV Programs Highlight in 2H16

Figure 3: Concerts & Plays business in 2Q-4Q 2016

Source: Company presentation

Figure 1: WORK's 2Q16 earnings preview

Unit : Btmn 2Q15 3Q15 4Q15 1Q16 2Q16E %QoQ %YoY 2015 2016E %YoY

Operating revenue 679 640 641 547 813 49% 20% 2,388 3,022 27%

Television Programs 531 589 553 496 743 50% 40% 2,079 2,715 31%

Event Marketing 77 5 25 29 30 5% -61% 108 113 5%

Concerts & Plays 67 43 59 21 35 63% -48% 168 180 7%

Others 5 3 4 1 5 572% 0% 33 13 -61%

Cost of sales and services 386 366 338 319 429 35% 11% 1,372 1,709 25%

Gross Profit 293 274 303 228 384 68% 31% 1,015 1,313 29%

SG&A 160 187 253 181 244 35% 52% 754 829 10%

Operating profit 133 87 45 47 140 196% 5% 261 484 85%

Income taxes expense (Income) 27 14 6 6 22 251% -18% 45 94 106%

Net profit 94 58 8 29 101 251% 7% 164 372 128%

EPS (Bt/share) 0.23 0.14 0.02 0.07 0.24 251% 7% 0.39 0.89 128%

Gross Profit Margin (%) 43% 43% 47% 42% 47% 5 pps 4 pps 43% 43% -

Operating Profit Margin (%) 20% 14% 7% 9% 17% 8 pps - 3 pps 11% 16% 5 pps

Net Profit Margin (%) 14% 9% 1% 5% 12% 7 pps - 2 pps 7% 12% 5 pps

Source: SET, AWS estimates

(Year end: Dec)

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CG Report

Corporate Governance Report disclaimer

The disclosure of the survey result of the Thai Institute of Directors

Association (“IOD”) regarding corporate governance is made pursuant

to the policy of the Office of the Securities and Exchange Commission.

The survey of the IOD is based on the information of a company listed

on the Stock Exchange of Thailand and the Market for Alternative

Investment disclosed to the public and able to be accessed by a

general public investor. The result, therefore, is from the perspective of

a third party. It is not an evaluation of operation and is not based on

inside information.

The survey result is as of the date appearing in the Corporate

Governance Report of Thai Listed Companies. As a result, the survey

result may be changed after that date, Asia wealth Securities Company

Limited does not conform nor certify the accuracy of such survey result.

Score Range Number of Logo Description

90 – 100

80 – 89

70 – 79

60 – 69

50 – 59

Below 50

No logo given

Excellent

Very Good

Good

Satisfactory

Pass

N/A

Corporate Governance Report of Thai Listed Companies (CGR). CG Rating by the Thai Institute of Directors Association (IOD) in 2015.

ADVANC BAFS BCP BIGC BTS CK CPN DRT DTAC DTC EASTW EGCO GRAMMYHANA HMPRO INTUCH IRPC IVL KBANK KCE KKP KTB LHBANK LPN MCOT MINTMONO NKI PHOL PPS PS PSL PTT PTTEP PTTGC QTC RATCH ROBINS SAMARTSAMTEL SAT SC SCB SCC SE-ED SIM SNC SPALI THCOM TISCO TKT TMBTOP VGI WACOAL

AAV ACAP AGE AHC AKP AMATA ANAN AOT APCS ARIP BMCL BOL BROOKBWG CENTEL CFRESH CHO CIMBT CM CNT COL CPF CPI CSL DCC DELTADEMCO ECF EE ERW GBX GC GFPT GLOBAL GUNKUL HEMRAJ HOTPOT HYDRO ICCICHI INET IRC KSL KTC LANNA LH LOXLEY LRH MACO MBK MC MEGAMFEC NBC NCH NINE NSI NTV OCC OGC OISHI OTO PAP PDI PEPG PJW PM PPP PR PRANDA PREB PT PTG Q-CON QH RS S&JSABINA SAMCO SCG SEAFCO SFP SIAM SINGER SIS SITHAI SMK SMPC SMT SNPSPI SSF SSI SSSC SST STA STEC SVI SWC SYMC SYNTEC TASCO TBSPTCAP TF TGCI THAI THANA THANI THIP THRE THREL TICON TIP TIPCO TKTKS TMI TMILL TMT TNDT TNITY TNL TOG TPC TPCORP TRC TRU TRUETSC TSTE TSTH TTA TTCL TTW TU TVD TVO TWPC UAC UT UVVNT WAVE WINNER YUASA ZMICOVNT WAVE WINNER YUASA ZMICO

2S AEC AEONTS AF AH AIRA AIT AJ AKR AMANAH AMARIN AP APCOAQUA AS ASIA AUCT AYUD BA BEAUTY BEC BFIT BH BIG BJC BJCHIBKD BTNC CBG CGD CHG CHOW CI CITY CKP CNS CPALL CPL CSCCSP CSS CTW DNA EARTH EASON ECL EFORL ESSO FE FIRE FOCUS FORTHFPI FSMART FSS FVC GCAP GENCO GL GLAND GLOW GOLD GYT HTC HTECHIEC IFEC IFS IHL IRCP ITD JSP JTS JUBILE KASET KBS KCAR KGIKKC KTIS KWC KYE L&E LALIN LHK LIT LIVE LST M MAJOR MAKROMATCH MATI MBKET M-CHAI MFC MILL MJD MK MODERN MOONG MPG MSC MTIMTLS NC NOK NUSA NWR NYT OCEAN PACE PATO PB PCA PCSGH PDGPF PICO PL PLANB PLAT PPM PRG PRIN PSTC PTL PYLON QLT RCIRCL RICHY RML RPC S SALEE SAPPE SAWAD SCCC SCN SCP SEAOIL SIRISKR SMG SOLAR SORKON SPA SPC SPCG SPPT SPVI SRICHA SSC STANLY STPISUC SUSCO SUTHA SYNEX TAE TAKUNI TCC TCCC TCJ TEAM TFD TFI TICTIW TLUXE TMC TMD TOPP TPCH TPIPL TRT TSE TSR UMI UP UPFUPOIC UREKA UWC VIBHA VIH VPO WHA WIN XO

Source: Thai Institute of Directors (IOD)

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CG Report

ขอมล Anti-Corruption Progress Indicator ของบรษทจดทะเบยน

ระดบ 1ACD AEONTS AFC AIRA AJ ALUCON AMC AQUA ARIP AUCT BAT-3K BIG BJCBLISS BMCL BOL BRR BSBM CBG CCET CCN CGD CMR CPH CSC CSPCTW DCON DRACO DSGT DTCI E EMC ESSO FOCUS FSMART GIFT GLANDGRAND GUNKUL HFT HTECH IHL ILINK ITD JSP KDH KTIS KTP LEE LSTMAJOR MATCH MAX M-CHAI MDX MIDA ML MPIC NC NEP NNCL NWR OHTLPICO PK PL PPM PRAKIT PRECHA PRIN PSTC PYLON RAM RICH RS SANKOSAUCE SAWAD SAWANG SCN SEAFCO SF SHANG SIRI SMART SMM SOLAR SPACK SPGSPPT SPVI STA STAR SVH SVOA SWC TAPAC TC TCCC TCJ TCOAT THTKS TNH TNPC TPA TPAC TPOLY TRC TRUBB TSE TTA TTI TTL TTTMTWP TWZ U UMS UPA UPOIC UTP UVAN VARO VI VIBHA VIH VTEWG

ระดบ 22S ABICO AF AKP AMARIN AMATA AOT APCO AYUD BEAUTY BFIT BH BKDBLAND BTNC CCP CI CSR CSS EFORL EPCO FE FNS FVC GEL GLOBALHEMRAJ IEC IFS INET JUTHA KASET KCAR KKC KSL L&E LALIN LTX MMALEE MBK MBKET MEGA MK MPG MTLS NCH NCL NPP OCC OCEAN PBPCA PRINC QH ROCK RPC S&J SGP SIAM SIS SKR SMG SMIT SORKONSUSCO TAKUNI TEAM TF TIC TIP TIPCO TMC TMI TPP TRT TRU TRUETSC TSI TTW TVD TVO UKEM UNIQ UWC VNG WIIK WIN XO

ระดบ 3AABC ACAP ADVANC AEC AGE AH AIE AMANAH ANAN AP APCS APURE ASASIA ASIAN ASIMAR BIGC BROOK BTS BWG CEN CENTEL CFRESH CHARAN CHO CHOTICM CNT COL CPALL CPF CPI CPL DELTA DEMCO DIMET DNA DTAC EAECF EE EVER FPI GBX GC GFPT GLOW HMPRO HOTPOT ICC ICHI IFECINOX INSURE IRC JAS JTS JUBILE KC KTC KYE LHK LPN LRH MAKROMC MCOT MFC MFEC MINT MJD MONO MOONG NBC NDR NINE NMG NSINTV OGC PACE PCSGH PDI PG PHOL PLAT PPS PR PRANDA PREB PSQLT RATCH RML ROBINS ROJNA RWI SAMCO SCCC SCG SEAOIL SE-ED SENA SINGERSITHAI SMK SMPC SPALI SPC SPCG SPI SRICHA SSI STANLY SUPER SVI SYMCSYNEX SYNTEC TASCO TCMC TFI THAI THRE THREL TICON TKT TLUXE TNL TPCORPTMILL TMT TSTE TSTH TTCL TU TVI UOBKH UREKA VGI VNT WACOAL WHAZMICO

ระดบ 3BAAV AHC AI AIT AKR ARROW ASK BA BDMS BEC BECL BJCHI BUICGH CHG CHOW CIG CITY CK CKP COLOR CWT EARTH EASON EPG F&DFANCY FIRE FMT FORTH GENCO GL GOLD GPSC GRAMMY HYDRO IRCP IT JCTKCM KWC LH LIT LOXLEY MACO MANRIN MATI MODERN MSC NOBLE NOK NPKNUSA OISHI OTO PAF PAP PATO PF PJW PLANB PLE POLAR PRG PTLQ-CON QTC RCI S11 SALEE SAM SAMART SAMTEL SAPPE SC SCP SFP SIMSLP SMT SPA SPORT SSC SST STEC STPI SUC SUTHA T TAE TBSPTCC TFD TGCI TGPRO THANA THIP TIW TK TMW TNDT TOPP TPC TPCHTPIPL TSR TT TYCN UAC UBIS UEC UMI UP UPF UT UV VPOWAVE WINNER YUASA

ระดบ 4ASP BAFS BANPU BAY BBL BKI BLA CIMBT CNS CSL DCC DRT DTCEASTW ECL EGCO ERW FSS GCAP HANA HTC INTUCH IRPC IVL KBANK KCEKGI KKP KTB LANNA LHBANK MTI NKI PSL PTG PTTEP SABINA SCB SNCSNP SSF SSSC TCAP THCOM TISCO TIMB TMD TNITY TOG

ระดบ 5BCP CPN GYT PE PM PPP PT PTT PTTGC SAT SCC THANI TOP

ไมเปดเผยหรอไมมนโยบายA ACC AJD AQ BCH BGT BROCK BSM BTC CHUO CPR CRANE EICFER JMART JMT KAMART KBS KIAT LDC MBAX MCS METCO NEW NEWS NYTPAE PDG PERM PMTA POST RCL RICHY ROH S SIMAT TCB TR TSFTVT WORKหมายเหตระดบ 1 : มนโยบายระดบ 2 : ประกาศเจตนารมณระดบ 3 : มมาตรการปองกน ซงทง 2 กรณ ถอเปนผลการประเมนในระดบเดยวกน

3A : บรษทมการประกาศเจตนารมณเขารวมโครงการ CAC หรอภาค3B : บรษทมค ามน และนโยบายของบรษท แตมไดประกาศเจตนารมณเขารวมโครงการ CAC หรอภาค

ระดบ 4 : ไดรบการรบรองระดบ 5 : ขยายผลสผท เกยวของ

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Head Office 540 Floor 7,14,17 , Mercury Tower, Ploenchit Road, Lumphini,

Pathumwan Bangkok 10330

02-680-5000 02-680-5111

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Silom, Bangrak, Bangkok, 10500 Thailand

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Road, Klong Toey Nua, Wattana, Bangkok 10110

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Room No.1605-1606 Baromrajachonnanee Road, Arunamarin,

Bangkoknoi, Bangkok 10700

02-884-7333 02-884-7357,

02-884-7367

Chaengwattana

99/99 Moo 2 Central Plaza Chaengwattana Office Tower, 22nd

Flr., Room 2204 Chaengwattana Road, Bang Talad, Pakkred,

Nonthaburi 11120

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9/99 Moo 2 Central Plaza Chaengwattana Office Tower, 22nd Flr.,

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Road, Bangkaew Bangplee, Samutprakarn 10540

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District, Rayong Province 21000

038-808200 038-807200

Khonkaen 26/9 Srijanmai Road, Tamboonnaimuang, Khon Khaen

40000

043-334-700 043-334-799

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20000

038-053-858 038-784-090

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District, Meung District, Chachoengsao 24000

038-981-587 038-981-591