tk oppday 57q4

Thitikorn Public Company Limited1

Thitikorn Public Company Limited

“Motorcycle Hire- Purchase Specialist”

March 05, 2015


I. Company Profile

II. Industry Overview

III. Operational Results

IV. Financial Highlights

Contents


I.

Company Profile


Company Development

1972 Established with 1MB registered capital to provide motorcycle HP in Bangkok

1982 No.1 in term of market share of motorcycle HPin Bangkok

1991 Increased registered capital to 70 MB

1995 Acquired 99.99% of CVA to expand HP business in Central and Eastern area

2000 Initiated motorcycle insurance program to minimize risk which later become the industry standard

2002 Received award from The Consumer Protection Board

2003 Acquired CYP to provide automobile HP

2003 Listed on the SET and raised fund of 1,100 MB

2005 Issued first TK’s Thai Baht-Debenture of 745 MB

2008 4-Stars Corporate Governance Scoring appraised by Thai Institute of Directors Association (IOD)

2010 Received Company Rating A- (Stable) from TRIS

2011 Acquired Cetelem (Thailand) Co., Ltd and changed its name to “TK Debt Services Co., Ltd.”

2012 Celebrate 40th year Anniversary

TK is one of the 17 listed companies to received an “Investors’ Choice Award” from Thai Investors

Association (TIA)

TK is one of the 9 Thai listed companies to be included in MSCI Small Cap Indices since November 30, 2012

2013 Total Assets surpassed 10,000 Mb for the first time

2014 First oversea operation in Cambodia, “Suosdey Finance” in Phanom Phenn

Second oversea operation in Laos, “Sabaidee Leasing Co., Ltd.” in Vientiane

TK is one of the 13 listed companies to received an “Investors’ Choice Award” from Thai Investors

Association (TIA)


TK Group Structure

Motorcycle hire purchase provider

with 6,766 MB portfolio size

Thitikorn Plc. (TK)

Total net portfolio of 7,768 MB

* As of Dec 31, 2014

99.99%

99.99%

99.99%

98.00%

* Received License from Bank of Cambodia on August 5, 2014

Automobile hire purchase provider

with 999.5 MB portfolio size

Chayapak Co., Ltd. (CYP)

Debt collection servicer

(previously Cetelem Thailand)

TK Debt Services Co., Ltd.



Suosdey Finance PLC.

Debt collection servicer

C.V.A . Co., Ltd. (CVA)



Sabaidee Leasing Co., Ltd.

61.91%

* Received License from Bank of the Lao PDR on October 21, 2014


Success Factors

Solid Capital Base : 4,002.6 million baht

D/E ratio of 1.2 times : average D/E of financial sector is 9.1 times

Abundant credit line from the leading financial institutions with

favorable terms & conditions

88.6 % of Total Assets are income generating assets

High quality motorcycle HP portfolio with 4.9 % NPL

Very conservative accounting policy : recognized full amount of commission on

day one

Stringent loan provision : reserve full amount of the whole contract value

A- rating by TRIS

Proven Track Record

Solid Financial Position

No.1 in motorcycle HP in Bangkok since 1982

Most recognizable brand by motorcycle dealers & customers

Reputable major shareholders - Dr.Chumpol Phornprapha & Families

Proven management with market expertise more than four decades in HP industry

Never been an NPL with any financial institutions since founded

Large valuable database of over 3,000,000 customers

Extensive & nationwide outlets with 90 branches in 53 provinces

Consistently provide HP service during any economic condition


II.

Industry Overview


Thailand Motorcycle Sales

Source : Thailand Motorcycle Hire Purchase Association, AP HONDA

78% 78%

79%

79%81% 79%

77%

77%

22%

22%

21%

21%

19%21%

23%

23%

1,595,305

1,741,749

1,553,561

1,846,005

2,001,244

2,125,646

2,004,000

1,699,218

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

2,200,000

2,400,000

2007 2008 2009 2010 2011 2012 2013 2014(11M) 2015 (F)

BMA Provincial Area(Units)

~1,750,000

Q1548,965

Q1431,792

Q2445,208

Q2548,423

1,885,809

Motorcycle sales reached a

new record high for two

consecutive years in 2011

and 2012, however, 2013 and

2014 sales continue to

decline for two consecutive

years due to slow down in

economic activities for the

last 7 quarters.

Q3494,460

Q3447,131

Q4(2M)255,574

Q4(2M)293,961


Monthly Motorcycle Sales

Motorcycle sale declined for

19 consecutive months from

May 2013 to November 2014

149,188

178,186

190,625

157,265

214,498213,724

187,266

179,417170,672

166,586

165,655

152,564

180,153177,736

191,076

169,031

189,056190,336

176,862

164,184

153,414151,101

142,860

118,191125,603

150,160

156,029

131,150

165,142

148,646

160,557

144,470142,104

135,076

120,498119,513

115,000

130,000

145,000

160,000

175,000

190,000

205,000

220,000

235,000

jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2012 2013 2014(Units)


Motorcycle Hire Purchase in BMA

78% 80%

78% 71%

61% 54% 49%

22%

20%

22% 29%

39%

46%51%

362,741

390,740

353,149

367,779

328,749

379,565 378,645

449,643454,263

340,095

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

500,000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014(11M)

Cash sale in BMA HP financing in BMA(Units)

(11M)424,782

Source : Thailand Motorcycle Hire Purchase Association

* Ratio H1 Year 2012 => Cash sale in BMA 49% , HP financing in BMA 51%

TK estimate that cash

sales portion remain at

35-40% due to tighten

lending policy from HP

operators in the first half

of 2014.


Category : Automatic


Category : Family


Category : Sport/ F-Sport


Motorcycle by Category

2% 8%15%

39% 47% 45% 46%51% 49% 48%

45%

39%

84%

90%

87%81%

58%

50%52%

50%

46%48%

49%

48%

50%

14%

7%

4%3%

2%

2%

2%

2%

1% 2%

2%

1%

1%1%

1%

1%

1%

2%

2%

3%

3%

5%

11%

1,328,194

1,767,074

2,043,634 2,109,227

1,976,493

1,595,305

1,741,749

1,553,561

1,846,005

2,001,244

2,125,646

2,004,000

1,699,218

-

200,000

400,000

600,000

800,000

1,000,000

1,200,000

1,400,000

1,600,000

1,800,000

2,000,000

2,200,000

2,400,000Sport F-Sport Family Scooter

(Units)

Source : Thailand Motorcycle Hire Purchase Association, AP HONDA


Thailand Automobile Sales

In 2012, Thai domestic auto sales reached a new

recorded high over 1.4 million units propelled by government first time car

buyer scheme.

In 2013 and 2014 automobile sales continue to decline for

two consecutive years

The Automotive industry latest forecast 2014 sales to

be approximately 900,000 units

Source : Toyota Motor Thailand Co.,Ltd.

71.5%61.0%

58.1%

56.7%54.6%

53.5% 52.6%

58.1%

28.5%39.0%

49.1%

43.3% 45.4%

46.5%

47.4%

41.9%631,251 615,269

548,871

800,357 794,081

1,434,669

1,330,678

881,832

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

900,000

1,000,000

1,100,000

1,200,000

1,300,000

1,400,000

1,500,000

2007 2008 2009 2010 2011 2012 2013 2014 2015(F)

Passenger car Commercial vehicle

Q1413,254

(Units)

~900,000

Q2 327,539

Q3 293,492

Q3 207,499

Q4 233,422

Q4 296,393

Q1224,171

Q2216,740


Monthly Automobile Sales

Automobile sale declinedfor 20 consecutive months

from May 2013 to December 2014

76,246

90,457

110,977

87,788

115,943123,471

131,646

129,509132,874

142,839148,243

144,676

125,817

129,910

157,527

109,673111,848

106,018

98,258

100,28994,945

88,989

93,483

113,921

68,508

71,680

83,983

73,26069,681

73,799

69,527

68,835 69,137

70,85073,068

89,504

20,000

35,000

50,000

65,000

80,000

95,000

110,000

125,000

140,000

155,000

170,000

185,000

jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2012 2013 2014(Units)


Eco Car


III.

Operational Results


Hire Purchase Business

Business

Policy

Hire purchase provider for all brands

Focus on new motorcycle hire purchase

Hire purchase term of 24 - 30 months

All brands such as Honda, Yamaha,

Suzuki, Kawasaki, etc.Product

Brands

Categorized by Outstanding Duration

Hire purchase provider mainly

Brand new cars

(95% new cars and 5% second hand cars)

Hire purchase term of 36 - 60 months

All brands mainly Toyota, Isuzu,

Honda, Nissan, Ford, Mitsubishi etc.

Motorcycle Automobile

Categorized by Outstanding Duration

Hire Purchase

Account

Receivables

Balance as of

Dec 14

<=12 month

11.30%

>12 month

88.70%13-36 month

49.61%

<=12 month

7.85%

>36 month

42.54%


Credit Policy

Customer Profile

Secured source of income and occupation

Clear hire purchase objective

Customize Terms and Conditions

Acceptable Guarantor

Not Recorded in TK’s Black List

Customer Residence in TK’s Coverage Area

Monitor Motorcycle and Automobile Model

as Per Standard Procedure

Proprietary credit approval policy and customize terms

and conditions for each customers


Credit Approval & Control

Preliminary Credit

Checking

Record & Documentation

Checking

Credit Approval

Debt Settlement

Debt Collection

Potential customers apply for credit approval; review customers’ profile

Verify accuracy of customers’ profile and collect required documents

- Analyze customers’ credibility through credit scoring system and customize

net financing

- Transfer customer profile to company’s database for future reference

Provide multiple payment channels through bill collectors, banks, counter

service and internet

- unpaid debt <3 months --> payment warnings

- unpaid debt 4-6 months --> agreement termination

- unpaid debt >6 months --> bad debt write off

--> repossess and appraisal after verdict


TK Branches & Networks

As of February 2015

Central

25 branches

North

11 branches

North-East

17 branches

East

27 branches

South

10 branches

Networks

Servicing over 1,032 motorcycle strategic alliances

Servicing over 45 automobile strategic alliances

Multiple payment channels

nationwide

Network

Branches

Extensive 90 branches in 53 provinces out of 77 provinces in

Thailand

Branch


IV.

Financial Highlights


Revenue, Expense and Net Profit

Slow down in economic activities since Q2 of 2013

together with negative growth in export and tourism sector as well as the

Ex-government inability to function properly due to prolong political

demonstration greatly reduced our customers payment ability

2,879

3,370

3,662

3,883

3,679

977 888

2,906 2,791

2,347

2,745 2,950

3,455

2,484

926810

2,5282,673

532.0625.0

712.0

429.0

195.6

51.0

78.0

378.1

117.5

-100

100

300

500

700

900

1,100

1,300

1,500

-

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

2010 2011 2012 2013 2014 Q4/2013 Q4/2014 9M/20139M//2014

Total Income (LHS) Total Expense (LHS) Net Profit (RHS)

Unit : Mb Unit : Mb


Revenue Breakdown

98.3% of Total Revenues contributed by Motorcycle HP Interest and Other Incomes

Q2/2014 Total Revenues = 928 MB

Motorcycle Hire Purchase Income

696 MB (75.0%)

Other Income

215 MB (23.1%)

Automobile Purchase Income

17 MB (1.9%)



679 MB (73.5%)

Other Income

228 MB (24.8%)Automobile Purchase Income

16 MB (1.7%)



665 MB (74.9%)

Other Income


15 MB (1.7%)


Revenue Breakdown

98.3% of Total Revenues contributed by Motorcycle HP Interest and Other Incomes

2013 Total Revenues = 3,883 MB


2,945 MB (75.8%)

Other Income

856 MB (22.1%)

Automobile Purchase Income

82 MB (2.1%)



2,758 MB (75.0%)

Other Income


66 MB (1.8%)



2,623 MB (71.6%)

Other Income


81 MB (2.2%)


Total Assets vs. Hire Purchase Account Receivables

88.6% of TK Total assets are HP portfolio which

generate stable monthly cash inflow from monthly installment from diversify

customers over 255,947 accounts

6,0116,962

7,5768,648 9,059

7,768

635

716

1,105

9751,208

999

6,646

7,678

8,681

9,62310,267

8,767

0

2,000

4,000

6,000

8,000

10,000

12,000

2009 2010 2011 2012 2013 2014

Receivables OtherUnit : Mb

15.8%

8.8%

14.2%

4.8%-14.3%


> 6 mth0.8%

<3 mth95.2%

Aging of Motorcycle 2014

4-6 mth4.0%

5,5036,157

7,1517,708

6,768

0

1,500

3,000

4,500

6,000

7,500

9,000

2010 2011 2012 2013 2014

Motorcycle HP portfolio Unit : Mb

1,459 1,4201,497

1,351

999

0

500

1,000

1,500

2,000

2010 2011 2012 2013 2014

-9.8%-26.1%

-2.7%5.4%

Automobile HP portfolio Unit : Mb

7.8%-12.2%

11.8%16.1%

* Net HP recievable (less allowance for doubtful a/c)

4-6 mth2.3%

>6 mth4.1%

<3 mth93.6%

Aging of Automobile 2014

High Quality HP Portfolio

* HP recievable

28


High Quality HP Portfolio

Prudent expansion policy with strict credit approval process and strong collection team

create sustainable HP portfolio.

2014 : Aging of Total HP Portfolio (8,303 MB)

Current -3 mth

7,890 MB (95.1%)

> 6 mth

102 MB (1.2%)

4-6 mth

311 MB (3.7%)


Current -3 mth

8,780 MB (96.4%)

> 6 mth

104 MB (1.1%)

4-6 mth

225 MB (2.5%)

Current -3 mth

9,202 MB (95.6%)

> 6 mth

128 MB (1.4%)

4-6 mth

293 MB (3.0%)



Stringent Accounting Policy

Past due over 3 months will be charged off

One time commission charged at the beginning of the contract

Motorcycle with past due over 6 months will be written off (without verdict process)

Automobile with past due over 6 months that had gone through verdict will be written off

Income Recognition and

Charge-Off Policy

Write-Off Policy

Provision for Doubtful

Account Policy

TK does not deduct the

collateral value before

setting provision for

motorcycle HP

Provision for Doubtful Account of Motorcycle Hire Purchase

Net Account Receivables

Current portion < 1 Months

1 < Overdue < 3 Months


Overdue > 6 Months

1

20

50

100

Provision for Doubtful Account of Automobile Hire Purchase

Provision for Doubtful Account (%)

Provision for Doubtful Account (%)Net Account Receivables

Current portion < 1 Months




Overdue > 12 Months

1

2

20

50

100


High Coverage Ratio

Robust reserve for loan loss with 129% coverage

ratio or 6.4% of total HP portfolio

7,328

7,957

9,109

9,624

8,303

117 78 104 129 102257 343 329 422 413366 381 461 565 535

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

2010 2011 2012 2013 2014

Net HP A/R NPL (>6 mth) NPL (>3 mth) Loan provision

Unit : Mb


Dividend

Year Operation Net Profit (MB)

Earning per share

Dividend per share

Dividend Dividend Last Price (Baht)

Dividend Yield

Period (The Company Only)

(Baht) (Baht) (MB) Payout Ratio As of XD

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

1 Jan 03- 31 Dec 03

1 Jan 04- 31 Dec 04

1 Jan 05- 31 Dec 05

1 Jan 06- 31 Dec 06

1 Jan 07- 31 Dec 07

1 Jan 08- 31 Dec 08

1 Jan 09- 31 Dec 09

1 Jan 10- 31 Dec 10

1 Jan 11- 31 Dec 11

1 Jan 12- 31 Dec 12

1 Jan 13- 31 Dec 13

1 Jan 14- 31 Dec 14

391.2

422.9

345.7

248.6

273.8

313.2

318.6

516.9

491.2

703.2

374.0

161.4

0.78

0.85

0.69

0.50

0.55

0.63

0.64

1.03

0.98

1.41

0.75

0.32

0.35

0.38

0.40

0.30

0.32

0.34

0.36

0.52

0.58

0.80

0.43

0.18

175.0

190.0

200.0

150.0

160.0

170.0

180.0

260.0

290.0

400.0

215.0

90.0

44.73%

44.93%

57.85%

60.34%

58.44%

54.28%

56.50%

50.30%

59.04%

56.88%

57.49%

55.76%

9.60

6.65

4.52

3.32

3.90

2.88

4.36

8.40

11.40

18.80

8.85

11.00

3.65%

5.71%

8.85%

9.04%

8.21%

11.81%

8.26%

6.19%

5.09%

4.26%

4.86%

1.64%


Investors’ Choice Award 4 consecutive years


Investors’ Choice Award 6 consecutive years


Strictly Private & Confidential


69 Ramkamhaeng Rd., Huamark, Bangkapi, Bangkok 10240

Tel: 662-310-7000 Fax: 662-318-3339

e-mail: [email protected]

tk oppday 57q4

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