“COTTO” Analyst Conference Q4/18

Thursday, January 24, 2019

2

Agenda

I. Market Situation and Performance

II. Financial Updates

III. Outlook

3

Market Situation

o Q4/18 ceramic tiles demand in Thailand increased +1%

y-o-y due to agricultural price increasing and upcoming

election in 2019, while FY2018 growth dropped -2% y-o-y

o For export situation, ceramic tiles demand in Cambodia,

Laos, Myanmar was positive from both residential and

non-residential segment

4

81% 77% 72% 79% 80% 75% 78% 80%

2% 5% 1%

0.7%

19%21% 23%

21%19%

25% 22% 20%

3,455 3,306 3,405

2,8113,099 2,949 2,797 2,713

Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18

Domestic

Non-Ceramics

Export

Revenue from Sales

*Non-Ceramics: Revenue from land selling at Nong Khae Industrial Estate

Total revenue Q4/18 decreased -3% y-o-y, -3% q-o-q while FY2018 dropped

-11% y-o-y

-3% y-o-y

-3% q-o-q

77%78%

2%

0.4%

21%

22%

12,977

11,557

FY2017 FY2018

Revenue from Sales

(FY2018)

Unit: MB

Non-Recurring Revenue

- 60 163 - 24 - - 19 223 43

5

83% 79% 76% 78%80% 74% 77% 79%

17%21% 24%

22%20%

26% 23% 21%

21.1 19.9 19.516.6

18.8 17.9 16.8 16.2

161 161

165168

162 163165 165

120

160

0.0

10.0

20.0

30.0

40.0

Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18

Domestic

Export

Average Selling Price

Sales Volume and Average Price

Q4/18 SCG Ceramics’s sales volume decreased -2% y-o-y while the average

price -2% y-o-y and remain unchanged from last quarter

Average Price

M.Sq.m.Sales Volume

Q4 Volume Change

-2% y-o-y

-3% q-o-q

Remark: Only ceramics tiles

Baht/Sq.m.

79%78%

21%

22%

77.1

69.6

FY2017 FY2018

Sales Volume

6

Sales Volume by Segment

(2) Only ceramics tiles

86%84%

14%

16%

77.1

69.6

FY2017 FY2018

Sales Volume

Unit: M.sq.m.

*Remark: (1) Definition of segmentation

Medium – High (portion 20%-30% of total market) – Wall Tile (Big size), Glazed Porcelain, Unglazed Porcelain, Mosaic, Glass Tile

Mass – Medium (portion 70%-80% of total market) – Floor Tile, Wall Tile (Small size), Outsource unglazed

88% 87% 86%84%

86% 85% 85% 82%

12%14% 14%

16%14% 15%

15% 18%

21.120.0 19.5

16.618.8 17.9

16.8 16.2

0

10

20

30

40

Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18

Mass-Medium

Medium-High

Q4-Volume Change

-2% y-o-y

-3% q-o-q

7

Domestic Sales volume by region

Remark: Only domestic ceramics tiles

10%

50%

10%

30%

South Region

Metropolitan

Central Region

North & Northeast

region

Market Situation FY2018Q4/18

y-o-y

FY2018

y-o-y

-3%

-0.5%

-2%

-1%

+1%

-2%

+3%

-4%

Downsizing scale in hotel segment in

Northern and growth demand in NE due

to rice price increased

Demand from residential segment in metro

region. Project low-rise in suburb area

continuous growth align with sky train &

subway route, while high-rise dropped.

Eastern Economic Corridor (EEC) urged

demand, especially Pattaya and

Sattahip area.

In general, demand decelerated due to

low rate in rubber and palm price. While

demand in tourist province increased

from construction in hotel-medium size

and renovation segment.

8

285357

457

316

209248

45

232

Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18

Unit: MB

EBITDA

EBITDA Q4/18 dropped -27% y-o-y and FY2018 dropped -48%

-27% y-o-y

+420% q-o-q

EBITDA Change EBITDA FY2018

(-48% y-o-y)

1,298

734

117

248

FY2017 FY2018

EBITDA Margin

8.3% 10.8% 13.4% 11.3% 6.7% 8.4% 1.6% 8.6%

983

1,415

Without non-recurring expense

Non-

Recurring

Expense

Non-Recurring

Income

10.9% 6.4%

EBITDA Margin without non-recurring

8.3% 9.7% 10.8% 11.5% 7.2% 8.9% 9.2% 8.8% 10.0% 8.5%

9

Profit for the Period

Profit for the period Q4/18 decreased -49% y-o-y, FY2018 decreased -98%

74

140

232

130

34 19

-109

66

Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18

-49% y-o-y

+160% q-o-q

Profit Change Profit FY2018

(-98% y-o-y)

482

10

94

198

FY2017 FY2018

Unit: MB

Without non-recurring expense

Key Non-Recurring - 29 72 (7) (12) (11) (170) (6)

- - - - - - (162) -

- - - (7) (21) (11) (8) (17)

- 29 72 - 9 - - 11

1)MSP (Loss)

2)Consultant Fee (Loss)

3)Profit from land selling

74 111 160 137 46 30 61 74

Profit for the Period (without Key non-recurring)

482 210

94 (198)

- (162)

(7) (57)

101 20

576

210

Non-

Recurring

Expense

Non-Recurring

Income

10

Operating Variable Cost

45% 42%

36%41%

19%18%

Q4/17 Q4/18

Assign Cost

Energy Cost

Raw Material Cost

Operating variable cost FY2018 climbed 5% y-o-y mainly from natural gas

cost increased 23% y-o-y

Remark: Only ceramics tiles

+22% y-o-y

-2% y-o-y

+1% y-o-y

- Mainly natural gas cost

- Mainly repair & maintenance cost and labor cost

- Mainly raw material cost

45% 43%

36% 39%

19%18%

FY2017 FY2018

+15% y-o-y

-4% y-o-y

+1% y-o-y

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Agenda

I. Market Situation and Performance

II. Financial Updates

III. Outlook

12

711

505

FY2017 FY2018

FY2018 CAPEX and Interest & Financial Costs

Amounted to 505MB for FY2018, mainly

upgrade machine, cost saving project and retail

outlet expansion

CAPEX

37

25

FY2017 FY2018

Interest and Financial Costs

Amounted to 25 MB in FY2018

Unit: MB Unit: MB

13

FY2018 Net Debt

Leverage rose to 0.6 times (x)

0

441

FY2017 FY2018

Net debt on EBITDA - 0.6

Unit: MB

14

FY2018 EBITDA on Assets and EBITDA Margin

11.0%

6.3%

FY2017 FY2018

10.9% 6.4%

EBITDA on Assets

EBITDA margin

*Remark: EBITDA on Assets = EBITDA/ Consolidates assets

EBITDA margin = EBITDA/ Consolidated sales

15

Agenda

I. Market Situation and Performance

II. Financial Updates

III. Outlook

16

Outlook

o Thailand’s ceramic tiles demand Q1/19 are forecasted

to increase +2% due to high season period

o In the export market, demands in neighbor country

continue to be positive

17

End of PresentationThank you