Thai Beverage PLC’s (ThaiBev) 2Q15 results were in line with our expectations amid uncertainties over economic growth in Thailand. Revenue was down 2.6% YoY to THB39.0b while PATMI rose 6.2% to THB5.9b, meeting 23% and 25% of our full-year estimates respectively. During the quarter, spirits business saw a 4.7% decline in sales due to lower sales volume, whereas beer sales remained steady due to an adjustment in ASP. Along with lower raw materials costs, net profit for beer was up 95% to THB158m.

There were also improvements in overall margins, as EBITDA margin gained 1.5ppt to 21.5% and net profit margin was 1.6ppt up to 15.3%. An interim dividend of THB0.15 has been declared, similar to last year. Maintain BUY with fair value estimate of S$0.83 for now, pending more information from management after trading close today.

Source: OCBC Research - 14 Aug 2015