ExperienceBeyond Food

Zen Corporation Group Public Company Limited

Opportunity Day

12th September 2019

Today Agenda

1. 1H-2019 Overview

2. 1H-2019 Financial Performance

2

1H-2019 Overview

Agenda 1

Key Historical Milestones

4

1991

1st ZEN

restaurant

2007

2014

1st Tetsu

restaurant 20172018

Public conversion of

ZEN as a preparation

for IPO

1st AKA

restaurant

2009

1st On the Table

restaurant

Incorporation of ZEN as holding company

2011

Business restructuring subsidiaries

Acquisition of “Tummour Chained Group”

1st Musha restaurant

2016

2015

Establish Zen Supply Chain

Management

Acquisition of Sushi Cyu

1st Khiang restaurant

2019

February 2019

Our 12 Active Brands

5

❖ 6 Japanese Food

Concept

❖ 6 Thai Food

Concept

Business Group Structure and Revenue Structure

6

I. Restaurant

Business

II. Franchise

Business

III. Other Food Related Business

• Retail Products

• Delivery & Catering

• Restaurant Consultancy

Business Groups Revenue Structure*

* Based on 1H19 data

Retail, 0.7%

Restaurant, 88.0%

Delivery , 1.9%

Raw Material Sales, 6.3%

Franchis…

Other Income, 1.0%

Franchise, 8.4%

Restaurant Outlets as at 30 June 2019Opened 30 branches in 1H-2019

7

Type of

BusinessBrand

Company Owned Franchise Total

OutletsThailand Thailand Laos Myanmar Cambodia

Japanese

Restaurants1. ZEN / ZEN Box 47 - - - - 47

2. AKA 19 - - 1 1 21

3. On the Table 20 - - - 1 21

4. Tetsu 1 - - - - 1

5. Sushi Cyu 3 - - - - 3

6. Musha 5 - - - - 5

Thai

Restaurants7. Tummour 11 103 1 1 1 117

8. LaoYuan 6 17 - - - 23

9. Jaewhon 4 6 1 - - 11

10. Pho / Kuaytiew 1 7 - 2 - 10

11. De Tummour - 1 - - - 1

12. Khiang 12 3 - - - 15

Total 129 137 2 4 3 275

8

Type of

BusinessBrand

Company Owned Franchise Total

OutletsThailand Thailand Laos Myanmar Cambodia

Japanese

Restaurants1. ZEN / ZEN Box 47 - - - - 47

2. AKA 20 - - 1 1 22

3. On the Table 22 - - - 1 23

4. Tetsu 1 - - - - 1

5. Sushi Cyu 3 - - - - 3

6. Musha 5 - - - - 5

Thai

Restaurants7. Tummour 11 105 1 1 1 119

8. LaoYuan 6 20 - - - 26

9. Jaewhon 4 7 1 - - 12

10. Pho / Kuaytiew 1 7 - 2 - 10

11. De Tummour 1 1 - - - 2

12. Khiang 23 3 - - - 26

Total 144 143 2 4 3 296

Restaurant Outlets as at 31 August 2019Opened 51 branches in 8M-2019

Khiang Milestones

9

1st Khiang restaurant

Community Mall Format

at Khiang Cherry Mall

DELCO Format

at Khiang Saladang

Total 26 Branches

19 Branches15 Branches

7 Branches

3 Branches

2 Branches

1 Branch

Total 1 Branch

5 Formats of Khiang

AUG19

DEC18

JAN19

FEB19

MAR19

APR19

JUN19MAY19

JUL19

Gas Station Format

at Khiang PPT Phrannok

Standalone Format

at The Curve Onnut17

Food Court Format

at Khiang Food Patio Central Bangna

New Branch Opened in 1H-2019 – Existing Brands

10AKA Siam Reap AKA Seacon Srinakarin

On The Table

101 Third Place

Zen CPN Chiangmai Festival AKA CPN Chiangmai Festival

New Branch Opened in 1H-2019 – New Concepts

11

De Tummour at Food Hall Siam ParagonZEN Box at BITEC

Khiang PTT Kaset-Nawamin

Dine-in & Delivery conceptMulti-brand in 1 branch

Khiang+Musha at The Curve Onnut17

Khiang Saladang

Delco concept

Khiang at Food Village Suvarnabhumi

Step-Up Delivery

12

Delivery sales aggressively grow in 2019

with professional partners

Jan’18 Jul’19

Growth

10 Times

Delivery sales

Expansion of Commercial Retail Business

13

Traditional Trade

- General Market

- Souvenir Shop

- Export International

Modern Trade

- Gourmet Market (The Mall Group)

15 branches

Modern Trade

- Makro Wholesales 115 branches

Modern Trade

- Tesco Lotus 1500 branches

Modern Trade

- Tops Supermarket 200 branches

Modern Trade

- Big C Supercenter 800 branches

Jan’18 Jul’19Retail sales

Growth

6.5 Times

Marketing Activities 1H19 –ZEN and AKA

14

Marketing Activities in 1H19 –OTT and Tummour

15

1H-2019 Financial Performance

Agenda 2

79.7

80.8

82.2

80.481.1

77.8

Quarterly SSSG & TSSG

17

12.5%

6.5%3.9%

-2.3%-4.4%

-1.3%

25.7%

19.9%18.6%

7.8%

1.8%4.4%

1Q18 2Q18 3Q18 4Q18 1Q19 2Q19

4Q18-2Q19•CCI improves prior to general election but then resumes downward trend on political uncertainty and poor economic results e.g. export slowdown •Weak domestic demand and consumption•Jan-Feb sales also impacted by air pollution•Many stores in Central World were impacted from the fire in Apr while SSSG in May-June were positive.

1Q18-3Q18• Rising CCI, marketing promotions and product innovation

drives high SSSG in 1Q18-2Q18• CCI peaks in 3Q18 and then changes to downward trend,

tourism impacted by negative incidents e.g. boat sinks

Consumer Confidence index

❑ SSSG

❑ TSSG

Declining Spending in Tourist Cities impacted to SSSG

18

Recession of Chinese Tourists made declining sales growth of tourist branches, that

more impacted to overall SSSG drop.

+12.5%

+6.5%+3.9%

-2.3%-4.4%

-1.3%

-1.0% -2.5%+0.2%

1Q18 2Q18 3Q18 4Q18 1Q19 2Q19

Equity SSSG Excluding Tourist Branches

will be better 1-2%

1H18 1H191H18 1H19

Same Store Sales

Branch @ Pattaya

YoY -15%

Same Store Sales

Branch @ Phuket

YoY -51% 1H19 - Same Store Sales of

Branch at Phuket and Pattaya

dropped by 25%

1H-2019 Total Revenue and Net Profit

19

1,4691,496

1,300

1,320

1,340

1,360

1,380

1,400

1,420

1,440

1,460

1,480

1,500

1H18 1H19

Total Revenue

71

65

4.8% 4.4%

-20%

-15%

-10%

-5%

0%

5%

45

50

55

60

65

70

75

80

85

1H18 1H19

Net Profit

THB Million THB Million

17

54

17

1,452

YoY +2%, Excl.one-time +3%

❖ Total revenue of 1H-2019 increased by 3% YoY when excluding 1-time income in 1H18, driven by restaurant sales

including delivery and retail business.

❖ Net profit of THB 65Mn, growth of 21% YoY excl.1-time. Net margin improved from 3.7% to 4.4%

YoY -8%Excl.one-time +21%

3.7%

2Q19 Total Revenue and Net Profit (YoY, QoQ Comparison)

20

Net Profit

24

32

47

33

2018 2019

1Q18 2Q18 1Q19 2Q19

YoY -29%Excl.one-time +12%

Q-Q +3%

%Net margin 3.4% 6.2% 4.4% 4.3%Excl. one-time 4.0%

30

716

730

753

765

2018 2019

1Q18 2Q18 1Q19 2Q19

YoY +2%Excl.one-time +4%

Q-Q +5%

17

736 17

THB Million

❖ 2Q19, Total revenue increased by 4% YoY when excluding 1-time income in 2Q18. And better than 1Q19 by 5%.

❖ Net profit of 2Q19 grew 12% YoY excluding 1-time and net profit margin improved from 4.0% to 4.3%

❖ Q-Q comparison, 2Q19 higher than 1Q19 by 3%, but %net profit margin lower a bit 0.1%

THB Million

Total Revenue

2 1 37

3

10

1Q18 2Q19 1Q19 2Q19 1H18 1H19

Commercial Retail

3962 59 66

101125

1Q18 2Q18 1Q19 2Q19 1H18 1H19

Franchise Fee and Merchandise Sales

YoY +7.5%

670 666 662 684

1,336 1,345

1Q18 2Q18 1Q19 2Q19 1H18 2H19

Restaurants Revenue

YoY +2.6%

Revenue from Main Businesses and Gross Profit

21

171 177 167 173

348 339

24.0% 24.3%

23.0% 22.8%

24.1%

22.9%

15%

16%

17%

18%

19%

20%

21%

22%

23%

24%

0

100

200

300

400

500

600

700

800

900

1Q18 2Q18 1Q19 2Q19 1H18 1H19

THB Million

Revenue from Main Businesses Gross Profit

711 729 724 757

1,440 1,481

1Q18 2Q18 1Q19 2Q19 1H18 2H19

YoY +2.8%

YoY -2.5%

YoY +3.7%

YoY -2.4%

YoY +0.7% YoY +24.1%

YoY +255.2%

%GP -1.1%

YoY+392.9%

289 281

19.7%18.8%

0%

5%

10%

15%

20%

50

100

150

200

250

300

350

400

450

500

1H18 1H19

YoY -2.9%

19.9%

SG&A Expenses

22

Staff & Benefit, 66%

Marketing, 16%

Rent and Utilities, 6%

Depreciation, 6%

Finance Exp., 1% Others, 6%

SG&A Expenses BreakdownSG&A Expense

1H-2019 SG&A Expense decreased 2.9% YoY and % Expenses to total revenue (last year excl.1-time) decreased

1.1% due to the decrease of marketing expenses and finance expenses.

* Based on 1H19 data

Financial Ratios ImproveLiquidity Ratios Greatly Improved after IPO

23

0.32

1.37

Dec 18 Jun 19

1,095

532469

1,386

2.34

0.38

-8.00-7.50-7.00-6.50-6.00-5.50-5.00-4.50-4.00-3.50-3.00-2.50-2.00-1.50-1.00-0.500.000.501.001.502.002.503.003.504.004.505.00

0

500

1,000

1,500

2,000

2,500

Dec 2018 Jun 2019

Liabilities Equity D/E Ratio

Current Ratio Debt to Equity

24