Bangkok--13 May--Minor International’s
Minor International’s (MINT) 1Q09 revenues were down 1% YoY to Bt 4,314 million and net profit was down 47% YoY to Bt 400 million. Restaurant revenues, which were up 33% following recent acquisitions of Coffee Club and Thai Express, helped to offset a 33% decrease in hotel and residential property revenues. MINT’s hospitality business was down in 1Q09 due to the global economic crisis and recent political instability in Thailand. Although revenues were largely unchanged in 1Q09, net profit was down 47% as the decline in profit from the hotel, residential and timeshare business was not offset by the increase in profit from the restaurant business.
In 1Q09, Minor Food Group’s (MFG) restaurant business, which compliments the hotel business when the tourism industry experiences declines, had revenues that were up 33% to Bt 2,546 million. Revenues were up as a result of a 16% increase in total system sales and the addition of 139 new restaurants system-wide from 1Q08. MINT is delighted to have had the opportunity to acquire 50% of The Coffee Club in February 2008 and 70% of Thai Express and continues to explore opportunities to acquire additional restaurant businesses that are highly profitable and able to expand to markets throughout Asia and the Middle East.
In 1Q09, MINT’s hotels experienced the full impact of the sudden decline in Thai tourism caused by the global economic recession and political instability in Thailand. Occupancy rates for MINT’s hotels decreased from 80% to 58% and, as a result, revenues were down 28% to Bt 1,348 million. In December 2008, political demonstrators closed Thailand’s international airports and this had a significant impact on occupancy rates and revenues in 1Q09. In 2Q09, Thailand experienced violent political protests in Bangkok and this had affected MINT’s hospitality business in 2Q09. 2Q09 and 3Q09 are historically off-season periods for Thai tourism and they account for less than 35% of MINT’s overall net profit. Should Thailand achieve political stability during this period, MINT expects to have a relatively strong 4Q09 with comparable growth over 4Q08.
Despite the challenges facing the Thai hospitality sector, MINT secured a 7 year long term, Bt 4,000 million refinancing from two Thai banks in 2Q09. Based on the strength of MINT’s core businesses, it low debt to equity gearing and the Thai hospitality sector’s resilience to events to discourage travel and tourism, MINT’s was able to secure this loan from Kasikornbank and Bank of Ayudhya.
Also in 1Q09, MINT’s shareholders approved a business restructuring plan that will allow MINT to diversity into new business areas and eliminate a cross-shareholding structure that exists with Minor Corporation (Minor). MINT plans to exchange 1.14 MINT shares for 1.0 Minor shares through a tender offer process. The tender offer process of 25 working days shall take place during 11 May 2009 to 12 June 2009 after Thailand’s Securities and Exchange Commission approved the plan on 7 May.
About Minor International: Minor International (MINT) is Thailand’s largest food service operator with over 1,000 outlets system wide under The Pizza Company, Swensen’s, Sizzler, Dairy Queen, Burger King, Thai Express and the Coffee Club brands. MINT is also a hotel owner, operator and investor with a portfolio of 27 hotels under the Anantara, Marriott, Four Seasons, Elewana and Minor International brands in Thailand, the Maldives, Vietnam, Africa, the Middle East and Indonesia. In 2009, voted by fund managers and analysts worldwide, MINT was recognized by Asia Money and Finance Asia magazines as Thailand’s Best Managed Mid-Cap Company for financial and business performance, management strategy and vision, and shareholder value creation. The Company’s operations for its owned and managed properties and franchised food outlets currently cover 16 countries with over 20,000 employees worldwide. For more information, please visit www.minorinternational.com