analyst meeting fy2018 - listed company · 2019. 3. 11. · • thai automotive industry from...

The Leading Provider of

Smart Industrial Platform Aug 2018 © 2018 TICON GROUP ALL RIGHTS RESERVED

22 November 2018

Analyst Meeting

FY2018

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This document has been prepared by TICON Industrial Connection Co.,Ltd. (“TICON”) solely for the reference of intended

recipients only.

The data, information, analysis and valuations contained herein in this document have been prepared based solely on information

obtained from public sources on or prior to the date hereof. TICON has neither independently verified nor in the future intended to

verify such information.

No representation or warranty, expressed or implied, is or will be made in relation to the accuracy or completeness of the

information contained in this document or any oral information provided in connection therewith, or the data it generates and no

responsibility, obligation or liability (whether direct or indirect, in contract, tort or otherwise) is or will be accepted by TICON or its

affiliates or by any of its respective officers, employees or agents in relation to it. In particular, no representation or warranty is

given as to the achievement or reasonableness of future projections, estimates, prospects, returns, if any.

Any views contained herein are based on financial, economic, market and other conditions prevailing as at the date of this

document. TICON does not intend, and therefore shall not be liable, to update all the information contained in this document.

This document contains confidential and privileged information. Any disclosure or distribution of any information contained in this

document, whether partly or wholly, to third parties other than the intended recipients without prior written consent from TICON is

strictly forbidden.

Disclaimer

2



Agenda

I. TICON Business Updates

II. Business Climate Overview

III. Financial Performance Review

IV. New Business Development

V. Outlook & Strategy

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Smart Industrial Platform Aug 2018 © 2018 TICON GROUP ALL RIGHTS RESERVED4

TICON Business Updates



2018 TICON Achievements Milestone

Early 2017 April 2018

Dec 2017

July 2018

October 2018

Bt13,230mn of

capital injection into

TICON with sharing

of know-how and

best practices for

future expansion.

Converted 3 Property

Funds to TREIT

2017

Partnered with STT

GDC

to operate

Hyperscale Data

Centre

in Thailand.

FAS bought 26.10% of TICON

from ROJANA and completed

tender offer process in May-18.

May 2018

89.5%

Others, 10.5%

Partnered with

JustCo

to operate

co-working office

locates at BKK

prime area.

TRA Land Development

won auction bidding for

land acquisition locates at

Bang Na-Trad KM.32

TICON is a leading provider of SMART Industrial platform

1st Batch of

assets

monetization to

TREIT.

August 2018

✓ Capital for future

development

5



2018 Business Highlight

Operational Performance Financial Performance

YTD Net Add for AUM of

102.8K sqm.

As at Sep-18

OCC Rate of factory (AUM)

increased to 70% from 66% in

Sep-17

OCC Rate of warehouse

(AUM) increased to 76% from

69% in Sep-17

Development of Data

Centre will begin early

next year.2018(9M18) Total

Revenue increased 146%

YoY to Bt3,817 mn driven

by higher management

fee income and sales of

properties.

2018(9M18) Net Profit

increased 171% YoY to

Bt668 mn

Strong EPS at 0.36

Baht/share

Overall Progress

TRA Land Development

won bidding auction 4,300

rais of land located at

Bang Na-Trad KM.32, a

potential development for

IE and Mix-use project.

JustCo currently

operates 2 co-working

offices totaling 6,800 sqm.

at AIA Sathorn Tower and

Capital Tower at All

Seasons Place and

secured a new strategic

office location at Samyan

Mitrtown 8,000 sqm.

1st Batch assets monetized

to TREIT comprising 79,000

sqm. of lease area and 53 rais

of land with total value of

Bt1.69bn

6



Overview of TICON’s business

TECHNOLOGYBUILDING & SERVICE DATA

Development Asset & Property Management Funds Expertise

Design & Development

Opportunity Identification

and Landbank Acquisition

Assets / Facilities

Management

Customer Relationship and

Repeated Business

Sell assets at fair price

Propose quality assets to TREIT

Over 2.7 mn sqm. under

TICON & TREIT portfolioValue added services to fulfill

customer centric solution

Industrial Property Business Model

Expand into high growth segment

of technology-based business

7



Business Climate Overview

8



Diversified land bank

locations of approximately

1,500 rais in 15 locations

in EEC area and other

strategic parts of

Thailand. TICON is ready

to support growth of

Thailand 4.0 industries.

New S-Curve Industries to support Smart City,

Electric Vehicles, Automation & Robotics.

Technology enabled platform to support Smart

Logistics Park

Unleash TICON potential to drive long-term

sustainable growth.

Current Progress of EEC Projects and Investment Plan

1. Key infrastructure projects were approved by the policy

committee (17 Billion $US) and on process of TOR.

2. Industrial Investment (10 targeted industries) were registered

for BOI 142 projects with total value of Bt183,230 mn from Jan-

Jun2018.

3. Tourism - Tourist Ministry identified the characteristic of the 3

cities and working on completion plan.

4. Innovation and Digital Parks (EECi and EECd) were in the

process of finding counterparts.

5. Human Resource Development – projects was implemented

in August 2018.

6. New City Development - water supply and energy have

completed a plan and budget allocation.

A concrete EEC - Strategic Gateway

Source: www. set.or.th - EEC 5 months progress, BOI

• Aviation Hub Logistics Hub

• Trading Hub

• Adv. Manufacturing Hub

• Tourism Hub

• Innovation Hub

• Global Business Hub

• Metropolis for the Future

• Digital Hub

Hub in Thailand

Opportunities for TICON

9



TICON’s nationwide strategic locations

10



Development of Key Customer sector

E-Commerce is growing due to an upward trend of

internet users, mobile internet subscribers and

mobile’s possession along with the digital purchases.

These factors are considered the base of the

development in e-commerce and expansion of

logistics business.

Potential Industry for factory and warehouse demand Automotive

• Thai automotive industry from Jan-Aug

2018 represented 15% of total export

value with higher growth trend in

2018YTD compares to previous year.

• According to the Federation of Thai

Industries (FTI), country’s car exports

are subject to global economic outlook &

potential auto tariff development.

Electronics

• The domestic market for electrical &

electronics industry represent a large

share of the country’s total export value

as high as 20.6% for 8M2018.

• According to The Office of Industrial

Economics (OIE), the domestic market

for electrical goods are expected to grow

from 2018 to 2020 in terms of both

volume and value.

Growth of Key Industry Export 8M2018 vs. FY2017

Source: FTI, OIE,SCBEIC

E-commerce

2018YTD growth

in Export Value

2017 YoY growth

in Export Value

Source : Euromonitor, OIE

Proportion of 8M2018 Industry Export to Total Export Value

Auto, 15.0%

E&E, 20.6%

Petro-chem, 8.3%

Energy, 3.6%Machine , 8.7%

F&B, 7.7%

Agri, 7.6%

Others, 28.4%

Proportion of 8M2018 Industry Export to Total Export Value

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TICON Diversified Tenant Base

A well diversified portfolio across

nationalities and industries – spreading

across key industries, including

automotive, electrical & electronics,

logistics provider, consumer products and

retail business, etc.

*As at Sep 2018

Thailand

Germany

USA

Others

37%

16%16%

6%

25% Japan

Automotive

FMCG

Electronics

Others

31%

19%14%

7%

29%

By Nationality By Industry

Logistics

12



Snapshot of Portfolio AUM

• AUM Net Additions YTD were

102.8K sqm. as at Sep 2018.

• TICON reported net addition of

40.5K sqm., TREIT registered

net addition 62.3K sqm.

• The main contribution came

from customers in Automotive,

Electronics and Logistics

industry located in EEC area

and Bang Phli.

Factory

AUM: 0.4mn sqm

AUM Contribution: 15%

Warehouse

AUM: 0.74mn sqm

AUM Contribution:

27%

TREIT

AUM: 1.56mn sqm

AUM Contribution: 58%

Total leasable area remains at

2.7 mm sqm

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9M2018 AUM Portfolio Metrics

449 properties under

management

Factory

1.1mn sqm.

AUM

27.2K sqm

405properties under

management

Warehouse

1.6mn sqm.

AUM

3.55years

75.6K sqm

Portfolio

Occupancy

Rate

WALE 3.79years

1.98 years

Portfolio

Occupancy

Rate

WALE 1.58years

Sep-18Sep-17

70%66% 76%69%

As of September, 2018

Sep-18Sep-17

Net Add YTD

Sep-18

Net Add YTD

Sep-18

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9M2018 Portfolio Metrics by entities

340 properties

40.5K sqm

TICON

Portfolio

Occupancy

Rate

66%56%

1.1mn sqm

Factories & warehouses

62.3K sqm

TREIT

Portfolio

Occupancy

Rate

79%77%

516 properties

1.6mn sqm

Factories & warehouses

Net Add YTD

Sep-18

As of September 30,2018

Sep-18Sep-17 Sep-18Sep-17

Net Add YTD

Sep-18

15



Indonesia (PT SLP Surya TICON Internusa)

Karawang, West Java

Occupied Area (sqm) 67,208

OCC rate 100%

Banjarmasin, South Kalimantan


OCC rate 100%

Makassar, South Sulawesi


OCC rate 100%

• Completed development of 10,000

sqm. in Karawang in October.

• BTS project in pipeline approx.

50,000 sqm. in FY2019.*as at Sep30, 2018

Bangkok to Hanoi

1,337 km

Bangkok to Vientiane 646 km

Bangkok to Yangon

832 km

Bangkok to Ho Chi Minh

863 km

Bangkok to Phnom Penh659 km

Bangkok to Kuala Lumpur

1,479 km

Bangkok to Singapore

1,836 km Kalimantan

Sulawesi

Java

TICON’s Regional Portfolio

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Financial Performance Review

17



FY2018 Revenue and Profit Performance

(Bt mn)

Net profit

966 1,049 1,172 1,373 1,043 1,151

4,561

3,346

251 194149

2,210

165

204

201 239146

227

164

256

249281

213

230

FY2014 FY2015 FY2016 FY2017 9M17 9M18Rental and related service income Sales of properties

Management fee income from associates Other income

(Bt mn)

1,5512,087

3,817

83% growth compare

with 12mth 2017

performance

146%

YoY

762 771

278

482

247

668

FY2014 FY2015 FY2016 FY2017 9M17 9M18

38% growth compare

with 12mth 2017

performance

171%

YoY

Revenue

TICON Revenue Structure

16% 22%

63% 66%

30%

78% 69%13% 9%

58%

3% 4%11% 11%

6%3% 5% 13% 13% 6%

FY2014 FY2015 FY2016 FY2017 FY2018 (9M18)

Rental and related service income Sales of properties

Management fee income from associates Other income

EPS

0.7 0.7

0.25 0.270.36

FY2014 FY2015 FY2016 FY2017 FY2018(Annualized)

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Rising rental income of Bt108mn from

higher occupied area of factory and

warehouse.

Rental and relate service income

FY2018 Financial Performance

Management fee from funds/REIT

Share of profit from investments

Sales of properties

Finance cost

Net Income

Early loan repayment funded by capital

injection from FPHT.

Profit & Loss statement(Btmn)

9M18 %YoY

Total revenue 3,817

Outstanding revenue growth mainly from

sales of properties to TREIT, OCC rate

improvement and higher management fee

income.

Earnings per share

Fee income rose by Bt81mn mainly from

TREIT, after conversion.

146%

55%

1,387%

13%

7%

171%

0.22

227

247

2,210

415

196

0.140.36

668

445

174

146

149

9M17

Rental and relate service income

10%1,151

Sales of properties hiked mainly from sales

of TICON’s properties to TREIT and BTS

warehouse transferred to customer in

1Q18.

1,551

1,043

Higher proportion holding in TREIT as well

as better performance of TPARK BFTZ.

19



Balance Sheet Composition

Cash & Current Investments

(Bt mn)

Gearing Ratio

Balance Sheet Strength

Surplus cash on hands

for CAPEX and

investments

460 1,156

306

2,620

6,448

FY2014 FY2015 FY2016 FY2017 9M18

1.50

1.88 1.95

0.530.59

FY2014 FY2015 FY2016 FY2017 9M18

Comfortable Gearing

Ratio up to 1.5x(X)

17,22622,005 22,242

13,320 16,330 14,980

2,5182,599 2,433

2,5462,428 3,778

11,46611,689 11,418 24,934

25,062 25,380

31,20936,287 36,093

40,800 43,821 42,999

FY2014 FY2015 FY2016 FY2017 2Q18 9M18

IBD Non-IBD Shareholder's Equity Total assets

Growing Assets and

Stronger Equity Base(Bt mn)

20



Bt3.6 bn of Sale of properties to TREIT

Property portfolio

to be sold to TREIT

Key Considerations for TICON

Key Considerations for TREIT

2. Reduce revenue

concentration risk and

increase proportion of

freehold assets

3. Consistent with TREIT’s

investment strategy to

ensure high occupancy

rate, reduce revenue

concentration risk and

diversify tenant base.

4. Enhance TREIT performance and distribution per unit.

1. Prime and strategic locations in Thailand with International Asset Quality

1. Monetize portfolio of stabilized yield generating assets for capital recycling for

business expansion.

2. Actively manage AUM portfolio for TREIT and TICON.

3. Increase revenue and net profit and improve return on equity to TICON’s

shareholders.

4. Support TREIT as its primary sponsor as well as encourage TREIT asset acquisition

from third party to grow its asset size.

“TICON’s growth

remain supported by

strong pipeline with

target development of

100K sqm per year”

21



New Business Development

22



• Tentative timeline for groundbreaking in

2Q/3Q 2019.

• Closing process to finalize land acquisition.

• Development of Data Centre will begin

early next year.

• 1st phase development with estimatedproject value of Bt7.3bn.

TICON Technology : Data Centre Business

Hyperscale Data

Centre.

Future integration

opportunity to

support Smart

Logistic Park

Ability to offer cross

platform services

Partner with Global

Data Centre player

Data Centre key updates

Data Centre

*Source: STT GDC

23



Co-working office

• Target expansion of 2-3 centers in 2019F.

• Part of that target is to launch 8,000 sqm.

at Samyan Mitrtown, a new integrated

development strategically located in the

heart of Bangkok and next to renowned

Chulalongkorn University

• Occupancy rate of existing sites

continued to grow. New floors at Capital

Tower at All Seasons Place opened in

3Q2018 which are on track to attain a full

take-up in 2019.

TICON - JustCo partnership

JustCo key updates

*Source: JustCo

24



Outlook & Strategy

25



New S-Curve Industries

Globalization & Regionalization

Optimization & Consolidation

Industrial Property New Demands

& New LocationsSustainability Trends

Enhancement

Enlarge &

Expand

Process

Innovation

Product

Innovation

Growth Liquidity

Balancing Growth

Growth Ready

Structure

TICON TOTAL DIMENSION Strategy & Business Outlook

• Asset Enhancement

Initiative and Asset

Management Exercise on the

way to drive occupancy rate.

• Leverage on existing

partnership to expand in

Thailand.

• Strong RB secured pipeline

and positive demand from

both existing & new tenants

for business expansion given

EEC clarity.

• Strong BTS pipeline with

advanced-level discussion

with Group Companies as well

as customer in Indonesia.

• 2nd Batch of assets

monetization to TREIT by

Dec-18 will further drive

2019F revenue.

Looking forward to 2019F

Upcoming Pipeline & Key Takeaway

Target Revenue growth at least 15% for 2019F.

Maintain strong balance sheet with Investment Grade Rating and Gearing Ratio

of 1.5x

New pipeline for 2019F up to 150,000 sqm.

On track to achieve 80% occ rate (AUM) in 2019 in-line with 3 years roadmap.

2019 Financial Guidance

26



TICON GROUPThe Leading Provider of Smart Industrial Platform

Investor Relations contact:

[email protected]

website: www.ticon.co.thwebsite: www.ticon.co.th

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analyst meeting fy2018 - listed company · 2019. 3. 11. · • thai automotive industry from...

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