Opportunity Daydtc.listedcompany.com/misc/PRESN/20201223-dtc...2020/12/23 · ordered a travel ban...
Transcript of Opportunity Daydtc.listedcompany.com/misc/PRESN/20201223-dtc...2020/12/23 · ordered a travel ban...
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Opportunity Day9M 2020 Performance
23 December 2020
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Disclaimer
The material contained in this document has been prepared by Dusit Thani Public Company Limited (“DTC”) and may contain forwardlooking statements which includes but not limited to statements regarding our intent, belief, current expectation in respect of DTC’sbusiness, operation, market researches, results of operation and financial conditions, capital adequacy, specific provisions and riskmanagement practices.
While due care has been used in the preparation of forward looking statements, the assumptions of the information are subject to variousrisk and uncertainties which the actual results may vary in a materially positive or negative manner differently from the anticipation. And noassurance 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 to investors orpotential investors in relation to hold, purchase, or sell securities. In this respect, DTC reserves the right not to be responsible andexpressly disclaims all liabilities for, damages of any kind arising out of use, reference to, or reliance on any information contained herein.
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Agenda
9M20 Recap 4
Financial performance 15
Outlook 20
3
Page
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4
9M20 Recap
Dusit Thani Abu Dhabi, UAE
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COVID-19: Global Impacts in 2020
100-120direct tourism jobs at risk
58%-78%decrease of International Tourist Arrival
Source: UNWTO World Tourism Barometer May 2020* and September 2020**
910-1.2loss in export revenues from tourism
TrillionBillion
850-1.1fewer international tourist arrivals
TrillionBillion MillionMillion
Current trends through August point to a drop in demand closer to
70%**,
The extension of the scenarios to 2021 point to a change in trend next year, based on the assumptions of a gradual and linear lifting of travel restrictions, the availability of a vaccine or treatment and a return of traveller confidence. Nonetheless, despite this, the return to 2019 levels in terms of tourist arrivals would take between 2½ to 4 years.**
especially now as some destinations re-introduce restrictions on travel.
* *
* *
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International Tourist Arrivals to Thailand
3.8
2.1
0.8
0.0 0.0 0.0 0.0 0.0 0.0 0.001
3.7 3.6 3.53.2
2.73.1
3.3 3.52.9 3.1
Jan Feb Mar Apr May Jun Jul Aug Sep Oct
2020 2019
Thai government has gradually relaxed restrictions to allow more business activities since May.
Early April, Thai government ordered a travel ban for foreigners entering Thailand
Travel ban is relaxed for specific groups (not for tourist) from August to September
Special Tourist VISA (STV) for long stay is allowed since October
-77%YoY29.5 to 6.7
9M209M19
Source: Tourism Authority of Thailand
In millions
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Thriving in the new normal: Dusit’s blueprint for sustainable successTO EMPOWER OUR PEOPLE TO EXCEED CUSTOMER EXPECTATIONS
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Accelerate positive transformation –Business and IT
FINANCIAL MODEL
BUSINESS MODEL
ORGANIZATIONMODEL
Asset optimization and financial resilience
Recover business and reimagine our services
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2
3
COLLABORATION CONTRIBUTIONINNOVATION
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3Q20
DTC’s Response to COVID-19
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FINANCIAL MODEL
Asset optimization and financial resilience1
Restructured educational business in the Philippines (divested Dusit Hospitality
Education Philippines)
Divested trading
securities
Epicure Catering acquired
business in Vietnam*
MOU with MPIC** to develop condo. &
hotels in the Philippines
Put new investment on-hold except for pre-COVID-19 committed transaction*• Postponed JV with MPIC for one year
Cost containment Liquidity preservation
Asset optimization
Financials
Investment
1Q20 2Q20 4Q20
* Acquisition of The Caterers by Epicure Catering was completed in 3Q20** Metro Pacific Investments Corporation
FIANCIAL MODEL | BUSINESS MODEL | ORGANIZATION MODEL
• Postponed Elite Havens luxury villa management expansion plan to Australia
Gain on investment reclassification
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Cost containment & Liquidity preservation
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Cost saving
CAPEX reduction
Cashflow management
• Long term loan reschedule (principal)• Cash on hand and short-term investment THB 900 mn (30 Sep 2020)• Unutilized credit facilities THB 1,090 mn• Unutilized long-term project finance THB 1,500 mn• Remaining proceeds from NRF divestment THB 675 mn
• Implemented cost-cutting measures especially fixed cost- Leave without pay, executive salary cut, and redundancy review- Lower advisory fees, administrative and marketing expenses
• Achieved cost saving around 34% YoY in 2Q20 and 31% YoY in 3Q20. Expect full year cost saving around 27%.
• Plan to maintain fixed cost at this level (20% cut in 2020) from 2021 onwards.
• Postponed recent real estate projects (JV with MPIC)• Selective investment• Re-prioritized property renovation plan• Excluding Dusit Central Park project and ASAI projects*, CAPEX plan in 2020 was cut by 60% from
original budget to THB 160 mn.
Rental fee reschedule • Exercised right to postpone the rental payment of assets under DREIT from Apr 2020 and resumed
payment from August 2020 onwards• Exercised another right to postpone rental from Nov 2020 and will resume payment from May 2021
* The remaining CAPEX of ASAI hotels (approximately THB 780 mn) will be financed by the project finance from financial institution.
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BUSINESSMODEL
Recover business and reimagine our services with collaboration, innovation, and contribution2
Operation3Q201Q20 2Q20 4Q20
Launched ‘Dusit Care’Raised hygiene and safety standards, physical distance &
contactless services
Gradually re-opened
hotels
Temporary closure of Dusit Thani College* and Le Cordon Bleu Dusit
Temporary cease operation of Epicure in Vietnam, Thailand & Cambodia
Temporary closure of all owned hotels in
Thailand & overseas.
Resumed operation of Epicure in Vietnam (Jun) and Thailand & Cambodia (Aug)
Re-opened school business
Temporary closure of food outlets**
Re-opened Baan Dusit Thani restaurant; Redefined food retail business plan; Expanded 3 Grab & Go kiosks for Kauai (Healthy fast-casual food outlets)
Temporary closure managed hotels in China
dusitD2 SalwaDoha
(Qatar)
Dusit Beach Resort Guam (USA)
Dusit Thani Wellness
ResortSuzhou(China)
Elite Havens expanded villa management
to India
Adjusted hotel opening plan to open 5 hotels
Soft opening ASAI Bangkok
Chinatown (Thailand)
Working on wellness project
Dusit Thani Laguna
Singapore
Re-opened hotels in China
*Available on-line course only, ** Delivery service only
Hotel
Education
Food
Property
Dusit Princess Srinakarin Bangkok hotel as ASQ (Sep)
Innovative & Collaborative marketing schemes e.g.• Stay with Confidence at Dusit
• Local Alike, Local Aroi, Local AlotSHA certification from TAT
Dusit Central Park: Continued on piling and sub-structure works; Pre-sales with ROIPostponed pre-sale of The Hampton Sriracha
by Origin & Dusit
Launched The Hampton sales activities (Nov) and continued
the construction
FIANCIAL MODEL | BUSINESS MODEL | ORGANIZATION MODEL
DTC’s Response to COVID-19
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COLLABORATION
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Uplifting community well-being through sustainable tourism.
Serving as a platform linking local community assets and experiences with the world at large through capacity building for communities on sustainable tourism as well as domestic and international market development.
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Dusit Local ExplorerCOLLABORATION
Source: Local Alike, Local Aroi, and Local Alot
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COLLABORATION Listen to the Earth in Silence
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Accelerate positive transformation – Business and ITORGANIZATION MODEL3
Organizational transformation
3Q201Q20 2Q20 4Q20
Reshape organization structureRe-enhance people capability
Re-engage employee experience & integration Reform process & system enablement
Business & People
TechnologyUplift companies core operating systems:
• Back office (ERP)• Front-end (CRM)• Data Platform
FIANCIAL MODEL | BUSINESS MODEL | ORGANIZATION MODEL
DTC’s Response to COVID-19
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Financial performance
15Dusit Suites Hotel Ratchadamri Bangkok, Thailand
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9M20 Performance hit by COVID-19 but improved Q0Q
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9M19 9M20Revenue contribution
Remark: REIT data is included in hotel business9M19 Others = Gain on sales of Dusit Thani Maldives, gain on sales of investments (DCP), revenue or EBITDA from Dusit Hospitality Services and Baan Dusit Thani, interest income, dividend income, share of profit from investment in associates and JV, and others9M20 Others = Arrangement fee (DCP), gain on investment reclassification (NRF), revenue or EBITDA from Dusit Hospitality Services and Baan Dusit Thani, interest income, FX gain, share of profit from investment in associates and JV, and others
• 9M20 total revenue declined by 47% YoY due to COVID-19 pandemic. However, total revenue showed recovery trend QoQ thanks to the higher revenue from
• Hotel re-openings with improving occupancy rate and RevPar
• Re-opening of Le Condon Bleu Dusit
• Higher food revenue from complete acquisition international school catering of The Caterers in Vietnam by Epicure Catering
• Managed to have cost saving by 31% YoY in 3Q20 (and 34% YoY in 2Q20) following business plan revisit and organizational transformation since 1Q20 targeting for long-term efficiency.
• Despite a YoY huge drop in EBITDA, EBITDA improved QoQ with less negative EBITDA in 3Q20 vs 2Q20.
Hotel64.4%
Education6.6%
Food7.2%
Others21.8%
THB4,316 mn
Hotel51.1%
Education11.7%
Food10.7%
Others26.5%
THB2,289 mn
1,26
2
424
643
1Q20 2Q20 3Q20
Total Revenue
THB mn
241
-207 -53
1Q20 2Q20 3Q20
EBITDA
THB mn
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6,834 7,181 7,1508,363
9,494
2016 2017 2018 2019 9M20
Owned
Managed
Hotel key statistics (excluding Elite Havens)
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Ow
ned
Hot
el
9M20: 40 properties
in 10 countries
Remark: For comparison purpose, the figures in 2017 exclude Dusit Princess Korat (divested at end-2017). Figures in 2018, 2019, and 9M20 exclude Dusit Thani Bangkok (closed in 1Q19) and Dusit Suites Hotel Ratchadamri Bangkok (new investment in 2Q19).
No. of Rooms
59%41%
62%38%
63%37% 74%26%
74%26%
72% 73% 77% 74% 76%
35%
59%
16%30%
2016
2017
2018
2019
9M19
9M20
1Q20
2Q20
3Q20
Occupancy Rate
3,72
7
3,59
7
3,67
0
3,61
0
3,34
0
3,39
9
4,46
7
2,04
5
2,01
8
2016
2017
2018
2019
9M19
9M20
1Q20
2Q20
3Q20
Avg Daily Rate
THB
2,69
0
2,63
6
2,84
1
2,68
5
2,54
9
1,17
5
2,61
5
320
597
2016
2017
2018
2019
9M19
9M20
1Q20
2Q20
3Q20
RevPar
THB
• Net addition of 1,131 hotel rooms during 9M20
• Hotel stats started to improve in 3Q20 both occupancy and RevPar after the re-openings most of hotels since June 2020
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Remarks of non-core items: 2017 = Gain on sales of Dusit Princess Korat and lease right assignment fee2018 = Gain on sales of available investment for sales and severance pay (Dusit Thani Bangkok)2019 = Provision for employee benefit as per new Labour Protection Act, gain on sales of Dusit Thani Maldives, gain on sales of investment, and gain on investmentreclassification.9M20 = Redundancy expense from organizational transformation and gain on investment reclassification
9,980 11,57314,237
21,047
2017 2018 2019 9M20Non-current Current
4,099 5,4958,332
16,718
2017 2018 2019 9M20Non-current Current
Total Assets
Earnings hit by COVID-19
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Total Liabilities Total Equity
5,881 6,078 5,9054,329
2017 2018 2019 9M20Non-controlling interest TotalEquity attributable to owners of the parents
THB mn
THB mn
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Gearing remained under covenant
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• Interest bearing debt increased significantly in 2020 due to the accounting adoption of TFRS 16 (Lease liability). • Excluding lease liability as of 30 September 2020, IBD to total equity equals to 1.22 times which remains below DTC's policy of not
exceeding 1.50 times, and debenture covenant of not more than 1.75 times.
4,459
12,994
5,279
2019 9M20 9M20excl.TFRS16
Interest Bearing Debt (IBD)
P/N CP of LT-LoanCP of Debenture LT-LoanDebenture Lease liability
35%19%
2%44%
1.22x
0.29x 0.33x0.76x
3.00x
2017 2018 2019 9M20
Leverage Ratio
IBD excl. TFRS 16 to Total equity
IBD to Total equity
202146%
202246%
20234%2024
4%
IBD Repayment schedule
THB 2,455 mn
THB mn
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Outlook
dusitD2 Khao Yai, Thailand
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Our view on tourism recovery
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Our view on the post COVID-19 hospitality landscape
More consolidation
of hotels
A balanced portfolio of
owned, leased and managed
models
CrossIndustry
Collaboration
New Hygiene, Safety & Security
measures
More Technology
Driven
Greater Sustainability
& Local Connection
Wellness & holistic health
experiences
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4Q20 Outlook
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Our positive view on a QoQ recovery was changed from the current abrupt surge of COVID-19 cases in Thailand.
Hospitality Education
Expect to see positive trend in 4Q20 due to• Additional revenue following the new semester
opening of Dusit Thani College• Greater YoY number of new Dusit Thani College
student enrollment • Increasing demand in Le Cordon Bleu Dusit.
International school catering business tends to continuously grow.
• Epicure Catering recognized full stream of revenue from both Thailand and international operations since new school semester began in July.
• Successfully secured new contracts: King’s College, Verso, ICS Udon Thani and Lycée Français International de Bangkok
• Consolidation of The Caterers into Epicure Catering started in September 2020.
Healthy fast-casual food outlets, Kauai, started to show positive trend with increasing sales from 4 outlets (1 original store and 3 newly expanded Grab&Go kiosks).
Food
• Domestic travelling is expected to be slowdown in the second half of December towards new year despite high season.
• However, hotel revenue should improve in 2H20 compared to 1H20 thanks to improving occupancy rate from the roll out of new vacation packages and new MICE model that designed to deliver more convenience, experience, and value for guests.
• Owned hotel occupancy rate continued to improve MoM to 41% in November (from 38% in October and from 30% in September).
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4Q20 Outlook (Cont’d)
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Property development
Dusit Central Park - a mixed-use project JV with Central Pattana• Completed demolition of above-ground buildings with progress on piling and sub-structure works. • Main contractor bidding process is in place and expected to be finalized by end-2020. • Residences pre-sales have been launched and focused on Register of Interest customers (ROIs)
JV with MPIC to development of condominium and hotel projects in the Philippines• Project has been postponed due to lower market demand from economic slowdown and COVID-19 impact
The Hampton Sriracha by Origin and Dusit - a condominium development project JV with Origin Property in Thailand)
• Continued the construction and launched sale activities in November.
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25ASAI Chinatown Bangkok, Thailand
Slide Number 1Slide Number 2AgendaSlide Number 4COVID-19: Global Impacts in 2020International Tourist Arrivals to ThailandSlide Number 7Slide Number 8Cost containment & Liquidity preservationSlide Number 10Slide Number 11Slide Number 12Slide Number 13Slide Number 14Slide Number 159M20 Performance hit by COVID-19 but improved Q0QHotel key statistics (excluding Elite Havens)Earnings hit by COVID-19 Gearing remained under covenantSlide Number 20Slide Number 21Slide Number 224Q20 Outlook4Q20 Outlook (Cont’d)Slide Number 25