integration

innovation

intimacy

Company’s Performance YE2019

25 February 2019

integration

innovation

intimacy

integrationinnovationintimacy

AGENDA

Our Business

2 YE2019 Financial Performance

4 Business Outlook for 2020

1

3 Performance YE2019 by BU

22

Our Business

AIR FREIGHT

SEA FREIGHT& INLAND

TRANSPORT

LOGISTICSMANAGEMENT

CHEMICAL& SPECIALTYLOGISTICS

3

▪ Cargo General Sales Agent (GSA): exclusive sales agent of • All AirAsia Airlines under Teleport Thailand

• Sri Lankan, Lan Cargo, Bhutan, Jeju Airlines and US Bangla Airlines for all routes from Thailand

▪Wholesale Freight Forwarder : providing domestic and international air freight services for co-loaders▪Air Cargo Terminal : International and domestic

cargo terminal at Don Muang Airport

AIR FREIGHT

4

▪ Shipping Line Agencies :

• Thailand Joint Venture : CK Line

▪Wholesale Freight Forwarder : Thailand Joint Venture with ECU Worldwide, global leader in Less-than Container Load (LCL) services with network in over 160 countries

▪ Inland Container Trucking Services: transport containers to and from seaport / container depot

SEA FREIGHT &INLAND TRANSPORT

5

▪ Integrated Freight Forwarder : International freight forwarding services for both sea & air transport and customs clearance for retail customers▪Warehousing : storage, inventory

management, and real-time reporting▪Distribution Management : modern trade,

shops, home delivery▪Fulfillment Service : focus on E-Commerce

and end to end supply chain services

LOGISTICS MANAGEMENT

6

▪ Integrated Freight Forwarder : International freight forwarding services for both sea & air transport and customs clearance for chemical & dangerous goods▪Dedicated Chemical Warehouse : storage,

inventory management, and real-time reporting▪ Inland and Distribution Management : for

industrial and B2B market ▪DG Packaging : sale of packing materials, DG

declaration and repacking services▪ ISO Tank Business : as agent for Nippon

Concept Co., Ltd, a Japanese based ISO tank operator for liquid chemical

CHEMICAL & SPECIALTYLOGISTICS

integration

innovation

intimacy

integrationinnovationintimacy

AGENDA

Our Business

2 YE2019 Financial Performance

4 Business Outlook for 2020

1

3 Performance YE2019 by BU

8

74%

3%

6%

17%

2,770.6 2,712.5

YE18 YE19

Performance YE2019 – Revenue

Remark : 1/ After eliminating inter-company transactions.

% Revenue Contribution YE18 vs YE19YE18 Vs. YE19

Revenue YE18 YE19 YoYAirfreight 2,279.6 2,215.6 (3%)Sea freight 116.6 84.9 (27%)Logistics 135.0 181.8 35%Chemical 561.9 526.9 (6%)Total Revenue 3,093.1 3,009.2 (3%)Revenue Consol 1/ 2,770.6 2,712.5 (2%)

-2%

74%

4%

4%

18%

Airfreight

Chemical

Logistics

Sea freight

Airfreight

ChemicalLogistics

Sea freight

Unit : Million Baht

9

Performance YE2019 – Gross Profit% Gross Profit Contribution YE18 vs YE19YE18 Vs. YE19

Gross Profit YE18 YE19 YoYAirfreight 249.9 205.7 (18%)Sea freight 71.7 60.1 (16%)Logistics 36.1 51.6 43%Chemical 132.9 126.8 (5%)Total Gross Profit 490.6 444.2 (9%)Gross Profit Consol 1/ 484.6 438.1 (10%)GPM 17.5% 16.1%

Remark : 1/ After eliminating inter-company transactions.

484.6 438.1

17.5%16.1%

YE18 YE19 -

200.0

400.0

600.0-10%

51%

15%

7%

27%

ChemicalAirfreight

46%

13%

12%

29%

Chemical

Airfreight

Unit : Million Baht

10

Unit : Million Baht YE18 YE19 Change%

Change+ / (-)

Revenues from sales and services 2,770.6 2,712.5 (58.1) (2.1%)

Costs of sales and services 2,286.0 2,274.5 (11.5) (0.5%)Gross profit 484.6 438.1 (46.6) (9.6%)

Gross profit margin (%) 17.5% 16.1% (1.3%)

Other income 18.4 11.8 (6.6) (35.9%)Selling expenses 77.2 80.9 3.7 4.8%Administrative expenses 295.0 280.0 (15.0) (5.1%)Gain (loss) on exchange rate - net 7.0 8.0 1.0 13.8%Financial Cost (1.9) (14.9) (13.1) 701.2%Share of profits from investment in Asso&JVs 32.1 96.1 64.0 199.6%Net profit 149.71/ 164.5 14.8 9.9%Net profit margin (%) 5.4% 6.1% 0.7%

▪ Share of profits from investment from DGPS and ALM for amount of 62.7 million baht, resulting in an increase of the Net Profit approximately 10%

▪ Gross Profit in 2019 decreased as a result of a decrease in total revenue and an increase in cost of services, especially for Freight minimum guarantee of TAA and TAAX

▪ Financial cost increased from Long term loan for investment in Around Logistics Management

Remark : 1/ Net Profit YE18 was changed from the adjustment of Share of profits from investment in Asso&JVs due to the Purchase Price Allocation of DGPS .

Analysis

Overall Performance YE2019

11

Financial Status as of 31 December 2019 Financial Ratio

Liability

EquityAsset

Ratio YE17 YE18 YE19

Company Performance

ROE (%) 1/ 17.8% 13.0% 13.3%Collection Period (days) 56.9 42.1 45.9 Payment Period (days) 93.7 61.1 67.8

Debt Performance

Current Ratio (times) 3.1x 2.1x 1.2xD/E Ratio (times) 0.4x 0.6x 0.7xIBD/E Ratio (times) (Bank Covenant <1.25x) 0.0x 0.0x 0.3xDSCR (times) (Bank Covenant >1.25x) 9.5x 14.5x 3.0x

Profitability Performance

Gross Profit Margin (%) 23.2% 17.5% 16.1%EBITDA Margin (%) 8.8% 7.9% 8.9%Net Profit Margin (%) 5.6% 5.4% 6.1%EPS (Baht per share) 0.21 0.25 0.27Trailing 12M EPS (Baht per share) 2/ 0.21 0.25 0.27

Remark : 1/ Trailing 12M Net Profit2/ Adjusted EPS based on existing shares at that time

Core Asset Million Baht

Cash 262AR 495PPE 277Investment (JV&Asso) 1/ 893

Core Liability Million Baht

AP 414IBD2/ 323

Unit : Million Baht

Remark : 1/ DGP 266 Million Baht and Around 513 Million Baht2/ Current portion of long-term loan 60 Million Baht

2,226

1,279

947

Asset Liability and Equity

Financial Health YE2019

integration

innovation

intimacy

integrationinnovationintimacy

AGENDA

Our Business

2 YE2019 Financial Performance

4 Business Outlook for 2020

1

3 Performance YE2019 by BU

13

389 401 398 402347 339 345 377

-11%

-16%-13%

-6%

-20%

-15%

-10%

-5%

0%

5%

0

100

200

300

400

500

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

AIR FREIGHT

Domestic

International

Wholesale Freight Forwarder

Unit : Tons

Cargo General Sales Agent (GSA)

Unit : Tons Unit : Tons

Air Cargo Terminal

▪ In 2019, volume of iii Air Services were generally better in comparison to the market

▪ Revenue slightly decreased due to the impact of strong appreciation of THB against USD (In 2019, about 45% of Air BU revenue was in USD)

▪ Gross profit also declined because of an increase in cost of services, especially for Freight minimum guarantee of TAA and TAAX

Total Volume of Air Cargo in Thailand (BKK, DMK, HKT, HDY, CNX and CEI)

2018 2019 (% YoY)000’ Tons

Average growth -11% in 2019

2,186 2,669 455 905

15,920 15,904

3,928 4,356

18,106 18,574

4,383 5,261

Y2018 Y2019 Q4/18 Q4/192,802 2,887 583 903

67,412 70,903

18,584 19,418

70,215 73,790

19,166 20,322

Y2018 Y2019 Q4/18 Q4/19

88,548 85,753

25,208 25,164

Y2018 Y2019 Q4/18 Q4/19

Performance – Air Business Unit

14

2,474 2,520 2,564 2,599 2,510 2,463 2,474 2,481

1%

-2%-4% -5%

-10%

-5%

0%

5%

10%

0

500

1,000

1,500

2,000

2,500

3,000

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

38,43443,630

9,620 12,010

Y2018 Y2019 Q4/18 Q4/19

1,8012,158

438 661

Y2018 Y2019 Q4/18 Q4/19

SEA FREIGHT & INLAND TRANSPORT

Liner Agencies (TEU) Trailer Services (Trips)

Total Container Volume in Thailand (% YoY)000’ TEU 2018 2019 ▪ Volume of Liner Agencies (Rizhao) growth 14% YoY. Revenue

slightly dropped due to a lower margin from the principal

▪ Trailer Services volume increased, but revenue and gross profit declined due to a decrease in high yield customers

▪ ISO Tank Operator service volume decreased, resulting in a decrease in revenue and gross profit

1,383

1,001

264135

Y2018 Y2019 Q4/18 Q4/19

Average growth -2% in 2019

ISO Tank Operators

Performance - Sea Business Unit

15

Delivery (#Order)

Distribution Management & Fulfillment Service

LOGISTICS MANAGEMENT

Integrated Freight Forwarder

Sea Freight (TEU)Air Freight (Tons)

144,909

403,858

63,192 105,693

Y2018 Y2019 Q4/18 Q4/19

320370

67 81

Y2018 Y2019 Q4/18 Q4/19

1,2371,469

193 225

Y2018 Y2019 Q4/18 Q4/19

▪ iii Logistics management services performed excellently, both in terms of volume and financial performance, attributable to the success of the plan to increase Key Account customers

▪ Volume of Air and Sea Integrated freight forwarder and related logistic services, as well as distribution management and fulfillment service for E-Commerce, were significantly increased

Performance - Logistics Management Business Unit

16

7,8236,906

1,876 1,568

Y2018 Y2019 Q4/18 Q4/19

CHEMICAL & SPECIALTY LOGISTICS

DG Packaging & Services

Packing Sales (Box) Packing Service (Shipment)

Integrated Freight Forwarder

Air Freight (Kgs) Sea Freight (TEU)

ISO Tank Operator (TEU)

214,600

124,739

51,503 21,774

Y2018 Y2019 Q4/18 Q4/19

12,083

24,918

2,406

9,063

Y2018 Y2019 Q4/18 Q4/19

2,867 3,023

764 736

Y2018 Y2019 Q4/18 Q4/19

▪ Volume of Integrated freight forwarder services decreased due to a drop in key account customers. resulting in a decrease in revenue and gross profit. Gross profit margin also affected by high market competition and macroeconomics factors

▪ ISO Tank Operator service volume and revenue were slightly declined. Gross profit still grow due to an increase in high-yield related services

▪ DG Packaging & Services successfully run, generating an increase in both revenue and gross profit to the BU

5,213 5,019

1,233 1,305

Y2018 Y2019 Q4/18 Q4/19

Performance - Chemical Logistics Business Unit

integration

innovation

intimacy

integrationinnovationintimacy

AGENDA

Our Business

2 YE2019 Financial Performance

4 Business Outlook for 2020

1

3 Performance YE2019 by BU

18

Triple i 2021 Aspirations and Strategy

Customer-driven growth:▪ Maintain leadership position in DG, as integrated logistics provider, grow regionally▪ Integrated logistics through “Triple i Solution”▪ “Organic Plus” - key Customer focus to identify unmet needs and pain points in

order to uncover new services

BUStrategy

Strategic directions

Aspirations

Partner-driven growth:▪ Lock in key long-term partners (airlines, network, authorities)▪ Wholesale business model and related services▪ Create new innovative products with partners (masterpiece for Thailand)▪ “Organic Plus” – key partner focus to identify unmet needs and pain points in order

to uncover new services

• Partnership with Teleport • Focus on e-commerce customer• Air cargo terminal at DMK and HKT• Cost management

• Grow its current customer base and new customers in import businesses by leveraging new IT platform

• Cost management

• Growth with CK Line• Seeking new shipping line partner• Cost management

• Grow by further penetration of its current customer base and acquisition of new customers

• Cost management

1. Air Freight 2. Sea Freight 3. Chemical 4. Logistics

Leading Thai Logistics House with sustainable growth in SEA and reaching market capitalization of THB 10 billion

Organic growth

Inorganic Growth

Inorganic growth by Business Development• Leverage GSA business through Around Logistics and Teleport• Focus on new logistics platform • Expand on air cargo terminal and ground handling service nationwide• Growth through new in-land transport partners and new platform• Growth with TLP : E-commerce, Asia Same day and Thailand Same day delivery

Enablers

▪ IT/Operations

▪ HR/People: ➢ Review organization , resource and compensation structure

to cope with our growth and vision

➢ Clear role and responsibility between shareholder and management➢ Prepare Succession plan➢ Management and staff competency development

➢ Leverage digital technology to develop new business opportunity and business model ➢ To provide business intelligence for decision making

19

Business Plan 2020AIRFREIGHT SEA FREIGHT &

INLAND TRANSPORTLOGISTICS

MANAGEMENTCHEMICAL & SPECIALTY

LOGISTICS

Organic Business Manage costs and maintain profit margin, while still pursuing new growth opportunities

1) Focus on increasing customer wallet share 2) Explore more businesses with more partners

3) Expand customer base 4) Improve cost management efficiency

where each BU will work with their key customers / partners to identify new services potential and earnings streams for the Company

Organic Plus Focus on key customers / partners and new initiative called “Organic Plus”

Keeping with our “partner driven” or “customer driven” strategy to achieve new capabilities and earnings.1) Expand business through investment with business partners: Same-day Asia with Teleport2) Expand logistics services landscape: Airport Ground Handling, Project Cargo and Rail Transportation3) Develop logistics services on digital platform: New E-Logistics Platform

BU5Pursue inorganic growth opportunities through M&A, Joint venture, new productdevelopment and new business model.

20

Business Outlook – Ongoing Business (1)➢ Reduction in production capacity and increased trade restrictions by many countries from the

spread of Covid-19 (Novel Coronavirus) in China

➢ Spreading of Covid-19 to reach peak in March and end in May 2020 - Impact to International Logistics and Supply chain until end of Q1 2020 and to exports and tourism industries in Q2 and Q3 2020 respectively

➢ GDP growth of China forecast to decrease from 5.8% to be 5.4%

➢ Thailand export volume is expected to decrease from 0.2% to -0.1%

COVID-19

➢ The world economic and trading are expected to recover modestly - following the slower growth of major countries i.e., the US, China and Japan

➢ US-China trade war - creates uncertainties which results in decreased demand for international logistics where rates are expected to fluctuates

Global Economy

21

Business Outlook – Ongoing Business (2)

➢ Air Freight rates to increase due to decrease in supply as flights cancelled due to Covid-19

➢ Sea Freight rate expected to be in fluctuations – from number of supply that can not be adjusted while the demand for transportation decrease from lower productivity in China

International Freight Trends

➢ Exchange rate is still in fluctuation - the Company manages its FX risks by engaging in forward and option contracts

➢ Minimized USD revenue portion and FX risks from the partnership with AirAsia Group through TLP-TH, the Company’s currency risk from 2020 onwards will be greatly decrease since

Exchange Rate