BTS Group Holdings Public Company Limited (BTS.BK) Earnings Call Transcript & Summary

Welcome to the BTS Group and BTSGIF Analyst Meeting for the First Quarter of 2025/'26 fiscal year. My name is Kan, and I will be your moderator during this presentation. For the first portion of this meeting, we will be providing you with an overview of our business updates and financial performance followed by a Q&A session. Today, we are honored to welcome all the management team, starting from Khun Surapong, CEO of MOVE Business; Khun Daniel, CIO of BTS Group; Khun Chawadee, CFO of BTS Group; Khun Siriphen, Fund Manager of BTS Group; Khun Chitkasem, CFO of VGI; [ Khun Cho Chan ], CEO of MATCH Business; and Khun Soraya, acting CEO and CFO of Rabbit Holdings. And again, all of the IR team here. As always, we would like to hear your feedback about today's presentation. So please scan the QR code, which will be shown at the end of the beginning of the meeting. And please make sure to turn off your microphone and you can turn it back on during the Q&A session. To start, I would like to hand over to Khun Daniel, our CIO, to recap on the financial performance for this first quarter.

Thank you very much. Good afternoon to you all. Starting with the business highlights. Now remember, it's only about 2 months since we last met, so there's not too many updates this quarter. But the Pink Line Extension did commence full operations in June 2025. Looking forward, the M81 Intercity Motorway is expected to commence full-time trial operations in August 2025. And most of the activity in the last quarter is related around the THB 20 Flat Fare, where we have continued discussions with the government on the anticipated October implementation of the Flat Fare. Within MIX, a couple of updates. First, the media business restructuring. As you well know, VGI has appointed PlanB to manage its advertising media. And also, the group increased its shareholding in PlanB, which has now reached 23.3%, VGI's stake in PlanB, 23.3% from 20.5%. Within MATCH, the only update is an update which was -- we talked about last quarter, which is ROCTEC's telecom agreement signed with the SRT. Moving on to the first quarter financial highlights. On the profit and loss side, we saw revenue expansion as well as a narrowing of the net loss. Operating revenue grew about 60% to THB 5.85 billion. MATCH revenue reached THB 2 billion, up 600% year-on-year. That's really been from the consolidation of Rabbit Holdings and ROCTEC. Recurring EBITDA, THB 2.7 billion, up 40% year-on-year. It's the third quarter that BTS Group has achieved a consistent EBITDA in excess of THB 2.5 billion. Net loss was around THB 448 million, which is a reduced net loss, but a net loss nevertheless. Moving on to the balance sheet. It remains well managed with cash and liquid investments THB 37 billion, although down slightly from THB 45 billion at 31st of March 2025. Adjusted net debt to equity is 1.39x, again, touched up a little bit Q-over-Q, but still well managed. And particularly when you take out the government receivables at adjusted net D/E is 1.06x. On the cash flow, again, not too much happening on the cash flow. It's only 3 months or so. Our cash flow from operations of THB 2.4 billion, investing cash flows of THB 4.9 billion and financing cash flows of a use of THB 1.4 billion. Moving on to the overview of the first quarter P&L statement. So total revenue THB 7.25 billion, up 38% year-on-year. You see operating revenue following a similar course, THB 5.8 billion, up 60%. And graphically in the bottom right-hand corner, you can see, again, the majority of that is coming from MATCH, around THB 1.8 billion and then secondarily from MOVE. Recurring EBITDA, THB 2.7 billion, up THB 800 million or 42% year-on-year, again, mainly from the consolidation of the MATCH business, Rabbit Holdings and ROCTEC. From a profit point of view, you see after minority interest that our net income comes in around about THB 229 million loss, which is an improvement on the THB 374 million loss year-over-year. Margin-wise, we've seen a slight decline in the EBITDA margin to 46%, again, a different mixture of business now following the consolidation and net profit margin still remains negative at minus 3.9%. Breakdown of operating revenue is now MOVE still in the first place at 46%, MATCH at 35% and MIX 19%. On to the cash flow. Starting cash of THB 31 billion, ending cash of THB 24 billion, again, just a THB 6 billion decline in cash. The 3 components of that, so adjusted CFO, a source of cash around THB 2.4 billion. Most of the investing cash flows was -- most of the use of cash was from CFI, which came from a mixture of purchases of investment properties as well as acquisition of financial assets. And then finally, in terms of financing cash flows, that was a drain of cash of THB 1.4 billion, mainly from the interest payments of about THB 2 billion and a repayment of long-term debt debentures. And that left us with ending cash of THB 25 billion at the end of the quarter. Now handing over to [ Khun Sasi ] for the MOVE business updates.

Thank you, Khun Daniel. Good afternoon, everyone. My name is [ Sasi ] IR of BTS Group. Let's take a look at how MOVE, MIX and MATCH performed this quarter. Starting with MOVE business. Our operating was THB 2.7 billion, up 20% year-on-year and 5% Q-on-Q. This growth was mainly driven by 3 key factors. First, construction revenue jumped more than 100% year-on-year and 45% Q-on-Q, thanks to a provision of contracting work for the Pink Line Extension, which actually commenced in June this year. Second, if you look at the bottom bar in the chart, O&M revenue kept growing steadily, up 5% year-on-year to THB 1.9 billion. And lastly, Farebox revenue was stronger, up 28% year-on-year, supported by higher ridership on both the Yellow and Pink Lines which increased 33% on the Yellow line and 15% on the Pink line. On the other hand, share of profit from BTSGIF dropped to THB 65 million, down 38% year-on-year, mainly due to amortization of the fund investment. Moving on to MIX business. Operating revenue came in at THB 1.1 billion, a slight drop of 5% year-on-year, mainly from advertising and distribution, however, digital services show improvement. Starting with advertising. Revenue was THB 444 million, down 13% year-on-year, mainly due to the lower revenue from the street furniture. Excluding that, the occupancy rate improved to 45% from 42% last year. Digital services grew 9% year-on-year, driven by higher interest income from Rcash, thanks to more outstanding loan and more lead generation revenue from Rcare and its subsidiaries. Finally, distribution fell 9% year-on-year, mainly from Fanslink due to lower sales of other brands products, but this was partly offset by stronger total retail sales. Lastly, MATCH business. Revenue was THB 2.1 billion, up more than 600% year-on-year, mainly due to the consolidation of RABBIT and ROCTEC from last November. RABBIT contributed THB 1.1 billion, THB 200 million from Financial Services and nearly THB 900 million from Real Estate, mostly hotel operations in Thailand. ROCTEC revenue was THB 810 million, driven by strong demand for Integrated Technology Solutions in both private and public projects in Hong Kong. Let's look at our financial position. As of 30th June 2025, total assets slightly increased mainly from a net increase investment properties, PPE and government receivables, partly offset by lower cash and cash equivalents. Moving on to the liability and equity on your right-hand side, you can see that liability also edged up due to higher loans from financial institutions, partly offset by debenture repayments. Equity fell 2%, mainly from fair value losses through OCI and lower noncontrolling interest. And finally, our adjusted net debt to equity improved to 1.39x from 2.29x last year with adjusted net debt at THB 144 billion. And this is all about the financial performance. Next, I would like to hand over to [ Khun Kantawan ] for business update.

Thank you, [ Khun Sasi ] . Let's move to our 3M business overview, starting from a quick update on the MOVE business, the Pink Line Extensions. Commercial operations have been started since 17th June from Muang Thong Thani to Lake Muang Thong Thani. We expect -- as of now, the ridership we have already seen the ridership reach over 10,000 during certain events that could impact Muang Thong Thani like music festival, food festival and other gatherings, and we expect the average ridership on this extension to exceed 13,000 trips per day. Next, [ Khun Kakana ] will provide you a MIX business update.

Thank you, [ Khun Kantawan ]. My name is [ Kakana ] from VGI IR team, and I will present the MIX update. Focusing on key developments at VGI during the first quarter of '25, '26. In May, VGI successfully entered into an advertising Media Management Agreement with PlanB. Under this agreement, PlanB will be responsible for managing the sales and marketing of VGI Group's advertising media assets. This collaboration is expected to increase VGI revenues through the launch of new and unique advertising products and improve cost management efficiency. On 24th of July, VGI completed a capital increase of THB 1 billion in PlanB via private placement. This increased VGI's shareholding percentage in PlanB to 23.2% (sic) [ 23.3% ]. At the same time, VGI appointed its representative as a director in PlanB. As a result, VGI shared the status of its investment in PlanB to an associate company. Regarding the advertising media business, VGI introduced an innovative product during the previous quarter called Platform Shelter. This comprehensive media solution integrates the key elements, including station balustrade position around platform area, structural roofing components and dynamic LED display screens. Platform Shelter stand out with its large static display of over 70 square meters, which can effectively capture passenger attention. This helps various bank present their products and services [indiscernible], efficiency reaching target customer group with high purchasing power in urban community areas and transportation hubs. This concludes all about the MIX update section. Now I would like to pass it over to Khun [indiscernible] for the MATCH update.

Thank you, [ Khun Kakana ]. We are moving to MATCH updates. Rabbit is now a subsidiary of BTS Group Holdings around 65% ownership. In August 2025, Rabbit has announced to execute 2 key divestment transactions. First transaction, Rabbit will divest 100% ordinary shares of Diplomat Prague RE s.r.o. and total outstanding loan liabilities with transaction value of EUR 67.5 million to Hotel Diplomat s.r.o. The buyer is a subsidiary of Czech Inn Hotel Group and Morningston with over 20 years of experience in hotel management and investment in Czech Republic. Significant asset of Diplomat Prague is Vienna House by Wyndham Diplomat Prague Hotel. Completion is expected within September this year with proceeds primarily allocated towards loan repayment. Second transaction, Rabbit will divest 50% ordinary shares and existing shareholder loans in Keystone Estate Company Limited with transaction value of THB 1.3 billion to Kingkaew Assets Company Limited, a subsidiary of BTS Group. Main assets of Keystone Estate Lands in Thana City Project in Bang Phli,Samut Prakarn. Completion is expected within December this year, subject to approval from the Extraordinary General Meeting on 14th October 2025. Proceeds will be used mainly for loan repayment and working capital. In addition, the company remains committed to executing its asset divestment strategy, including the sale of multiple commercial units in line with the planned time line by 2026. Next, I would like to hand over to [ Khun Ekapon ] for further MATCH update. Thank you.

Thank you, Khun [indiscernible]. My name is [ Ekapon ] from the ROCTEC Investor Relations team. For the ROCTEC, I would like to remind you again that ROCTEC is now a subsidiary of BTS Group Holding around 64% ownership. I would like to share an update on one of ROCTEC's key growth driver. The Telecommunication Network System Installations Project for the State Railway of Thailand or SRT. The contract was signed in April, a key milestone for us valued at THB 1,500 million. With ROCTEC share about 1/3, the project cover high-speed fiber optic installation and ICT integration into intelligent rail infrastructure. Construction will take 18 months and will enhance communication and train control system while preparing the network for future high-speed rail. This reinforced ROCTEC track record in ICT and lay the foundations for future opportunity in advanced rail technology. Separately, in terms of financial performance, this quarter delivered solid improvement across all levels. Starting with the revenue, is THB 1,825 million, up 9% year-over-year with ICT solution contributing 85%. Gross profit was THB 230 million, up 17% year-over-year, and the net profit was THB 121 million, up 63% year-over-year. That's all for ROCTEC update.