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MINT REPORTS 52% INCREASE IN NET PROFIT IN 1Q15

BackMay 13, 2015

Minor International (MINT) reported strong first-quarter net profit of Baht 2,157 million in 1Q15, a 52% increase from Baht 1,420 million in 1Q14. The increase in profit is mainly due to the robust performance of MINT's core restaurant and hospitality businesses, as well as contribution from MINT's M&A activities including revaluation surplus required under Thai Generally Accepted Accounting Principles (Thai GAAP). Thailand's tourism sector has witnessed a major turnaround after adverse political events last year, with first-quarter tourist arrivals growing by more than 20% to a record high. MINT capitalized on this rebound and leveraged on its leading market position to achieve a record-high first quarter net profit.

In 1Q15, net profit of MINT's hospitality business increased 67% y-y, largely as a result of improved performance of Bangkok hotels, growth of residential sales and Anantara Vacation Club, as well as gains from business acquisition relating to the Sun International transaction. Revenue per available room (RevPar) of the Company's owned portfolio grew 8% y-y in 1Q15, led by a strong rebound in the company's Thailand hotels, which saw RevPar increase by approximately 20%. RevPar of MINT's Thailand hotels also reached record-high levels, reflecting a full recovery of tourist arrivals to Thailand after a period of political uncertainty. Another contributing factor driving 1Q15 hospitality performance was MINT's real estate business, which comprises residential development and Anantara Vacation Club. The real estate business saw its revenue grow by 45% y-y as MINT completed its sales of the St. Regis Residences in this quarter, together with strong performance of Anantara Vacation Club. In 1Q15, MINT also recorded a revaluation gain from the portfolio of properties acquired in the Sun International transaction which MINT recently completed. Following completion of the transaction, the properties were required to be revalued and their market valuations were substantially higher than the acquisition price, resulting in the revaluation gain. The Company expects its hospitality business to continue to perform well through the remainder of 2015, with the continued recovery of hotels in Thailand, the improving performance of its overseas hotels and strong contribution from its real estate business.

In 1Q15, net profit of MINT's restaurant business increased 19% y-y, primarily led by its Thailand and Australia hubs, with all of key brands in both hubs exhibiting improved performance y-y. Once again, the Company's leading position in the Thai restaurant industry together with its international and brand diversification strategy contributed to the strength and resilience of MINT's restaurant business. Total-system-sales rose 17.9% y-y in 1Q15, driven by 0.6% same-store-sales growth and 10% outlet expansion y-y. The Company expects its creative marketing initiatives to further drive traffic at its domestic and overseas outlets and as a result further strengthen same-store-sales growth in the remainder of the year. This, combined with disciplined outlet expansion and its cost-saving strategy, are expected to lead to strong performance through the end of 2015.

MINT's retail trading business reported an 8% decline in net profit in 1Q15, due primarily to discretionary spending slowdown together with delayed ordering from a key contract manufacturing client. Nonetheless, the retail trading business is implementing a proactive distribution strategy, productivity improvement efforts and cost control measures to drive its performance through the remainder of 2015.

About Minor International: Minor International (MINT) is a global company focused on three primary businesses including restaurants, hotels and lifestyle brands distribution. MINT is one of Asia's largest restaurant companies with over 1,700 outlets operating system-wide in over 20 countries under The Pizza Company, Swensen's, Sizzler, Dairy Queen, Burger King, Thai Express, The Coffee Club, Ribs and Rumps, BreadTalk (Thailand) and Riverside brands. MINT is also a hotel owner, operator and investor with a portfolio of 133 hotels and serviced suites under the Anantara, AVANI, Oaks, Per AQUUM, Tivoli, Elewana, Marriott, Four Seasons, St. Regis, Radisson Blu and Minor International brands in 22 countries across Asia Pacific, the Middle East, Africa, the Indian Ocean, Europe and South America. MINT is one of Thailand's largest distributors of lifestyle brands focusing primarily on fashion, cosmetics and contract manufacturing. Its brands include Gap, Banana Republic, Esprit, Bossini, Charles & Keith, Pedro, Red Earth, Tumi, Zwilling J.A. Henckels, ETL Learning and Mysale. For more information, please visit www.minorinternational.com.

PERFORMANCE (Bt m)
 
1Q15
1Q14
% Change
Total Revenues
12,164
10,630
14%
Cost of Sales
3,897
3,504
11%
Selling & Administrative
4,929
4,551
8%
EBITDA
3,337
2,575
30%
Depreciation & Amort.
735
660
11%
EBIT
2,601
1,915
36%
Interest Expenses
317
243
31%
Earnings Before Tax
2,285
1,672
37%
Corporate Tax
94
212
-56%
Minority Interest
34
40
-14%
Net Profit as Reported
2,157
1,420
52%
Fully Diluted EPS as Reported (Bt)
0.4900
0.3548
38%
Fully Diluted Shares (mn)
4,402
4,002
10%

Note: Share of profit is included in other revenues


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