In this new series, we will feature one Singapore-listed company each time as a quick guide to everything you should know about it in 60 seconds.
In this instalment, we have Thai Beverage Public Company Limited (SGX: Y92). Previously, we featured ComfortDelGro Corporation Ltd (SGX: C52), a land transport giant with businesses in various countries.
What’s Thai Beverage’s Business About?
Thai Beverage, as the name might suggest, is a food and beverage company in Thailand, and the largest at that in the country. The company has four main business segments — spirits, beer, non-alcoholic beverage, and food. Some of the famous brands under Thai Beverage’s stable include Chang beer, Saigon beer, Oishi green tea, and 100PLUS isotonic drink.
As of 30 September 2018, Thai Beverage had a 28.5% stake in Fraser and Neave Limited (SGX: F99), Singapore’s long-established beverage producer and distributor, and a 28.3% stake in Frasers Property Ltd (SGX: TQ5), a multi-national property company.
Thai Beverage’s Financial Highlights
Thai Beverage just released its financial results for the year ended 30 September 2019 (FY2019) on Friday.
Revenue for FY2019 improved 16% year-on-year to THB 267.36 billion, while profit attributable to shareholders grew 30% to THB 23.27 billion.
Sales rose as Thai Beverage’s domestic beverage business showed signs of recovery, boosted by the Thai government’s stimulus measures announced in August this year. Higher margin from the company’s beverage segments and increased profit contribution from Fraser and Neave and Frasers Property led to higher profitability for the year.
As of 30 September 2019, Thai Beverage’s balance sheet had a cash hoard of THB 24.36 billion and total debt of THB 219.58 billion. This gives it a net debt position of THB 195.22 billion. Even though the net debt figure fell from a year ago (THB 208.76 billion), Thai Beverage’s debt-to-equity ratio still looks high at 1.7 times. The debt-to-equity ratio reveals a company’s financial leverage.
Over the slightly longer term, from FY2016 to FY2019, Thai Beverage’s revenue climbed 12% annually, but its net profit increased by just 1% per year.
Thai Beverage’s Dividend History
The following table shows how Thai Beverage’s dividend has been from FY2016 to FY2019:
|Year||Dividend per share (THB)|
*Note: FY2016 covers only nine months, from January to September
For FY2019, Thai Beverage’s dividend per share increased by 23% year-on-year to THB 0.48 on the back of higher profitability, as seen earlier.
Major Risk For Thai Beverage To Take Note Of
Majority of Thai Beverage’s revenue comes from Thailand. Therefore, any slowdown in the Thai economy could hurt beverage consumption in the country, and hence affect Thai Beverage’s business.
Thai Beverage’s Share Price And Valuation
Thai Beverage’s share price has increased by around 36% in all over the last five years.
Source: Google Finance
At the time of writing, Thai Beverage’s share price is at S$0.90. At that price, Thai Beverage has a price-to-earnings ratio of 21 and a dividend yield of 2%.
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Disclaimer: The information provided by Seedly serves as an educational piece and is not intended to be personalised investment advice. Readers should always do their own due diligence and consider their financial goals before investing in any stock. The writer does not have a vested interest in the companies mentioned.