Minor International Public Company Limited (MINT) Earnings Call Transcript & Summary

Well, officially, welcome everybody for analyst presentation today to wrap up and demonstrate our strength that we showed last year, full year '25 as well as performance of fourth quarter, and then we will have an outlook of '26 in our presentation today as well. We have an honor of having Dillip, our group CEO, to present to us all today. But before we start with the presentation, we would like to show the video. First will be the video of Minor Hotels and second will be a video of Minor Food just to see what has been -- what we have been doing in the past several months. Before we start the presentation, please start the video for us. [Presentation]

Now please welcome Kun Dillip Rajakarier, Group CEO of Minor International, on the stage.

Good morning, everyone. Welcome to the 2025 Investor Day, the presentation today. Very much appreciate your continued interest on Minor International and the time you have taken to be here today, both joining us in person and also dialing in from overseas as well. As we all know, last year has been a tremendous year for us, a fantastic year in terms of performance in spite of all the headwinds we've had, which I would explain a little bit later. And Minor Hotels and Minor International and including Minor Food has been much more resilient and making us more diversified and also with a more disciplined approach with our global hotel platform and also the global food platform as well. As we all know, our strategy is not just about growth. It's also focusing a lot more on what we call value accretive growth to our shareholders. And also, it's about improving investors for return on invested capital and also building a sustainable compound earnings over the long term. We've always said that we will grow by net earnings of 10% to 15% or 15% to 20% on a CAGR basis and that's what we have delivered for last year and also the prior years as well. So it's a bit of a time, a reflection point for us last year in terms of now moving more into an asset-light growth, which, again, we will demonstrate like what we have done last year in terms of setting the base for the coming years and also what we have in plan for this year as well. So I think looking ahead, we will continue to deleverage, which is something we've always said we will do. So that is in progress. I will give you an update on how we are progressing as well and also providing greater flexibility to enhance shareholder returns and through higher dividend payouts as well. We will be announcing our final dividend payout soon at the AGM. So I think hopefully, all the shareholders will be happy for that news as well. Moving along, I think today -- I will focus on 3 things today. So basically, what we have achieved in 2025 and then move on to how we are going to reposition ourselves for 2026, in terms of unlocking value based on what we have done in 2025; and finally, we'll walk through the financial highlights for 2025 and give you a little bit of color on where we are or how we have started 2026 as well. So let me start by looking at the successes on the development side for 2025. So 2025, just to recap, it was all about execution in terms of very strict financial discipline, which we have done. We have delivered another year of high-quality earnings both with core and reported profits growing by 16% on a year-on-year basis. The core EBITDA margin expanded by 33 basis points on a year-on-year basis, mainly driven by cost management and also improved operational efficiency as well, using technology, both on the hotels and the restaurant side as well, which you just saw the video. We have also lowered the interest burden further supported by earnings, lifting our core profit margin by 81 basis points on a year-on-year basis. So operationally, we remain proactive in a portfolio, what we call portfolio asset management. Looking at Minor Hotels, we simplified the group structure through delisting of Minor Hotels, Europe and Americas, which is something we've tried for 3 years, and we were -- we never gave up and we were successful in terms of delisting Minor Hotels, Europe and Americas last year in October, which will help us to enhance the flexibility to pursue long-term strategy and also initiatives, including our REIT -- the launch of the REIT as well. We unlocked some asset value through selective hotel disposals in Europe and we deployed that capital into higher return opportunities, which we did last year. For Minor Food, we increased our investment in GAGA to strengthen the key growth engine and also formed a strategic partnership with Europastry to scale up our food platform to become one of the largest regional players in frozen bakery and market as well. In terms of expansion, Minor Hotels has expanded and opened -- last year, we opened 23 hotels globally. And we signed for the first time, Minor Hotels last year, we signed 40 management contracts, including some franchises as well mostly or almost everything under asset-light. So it was our highest-ever signing for last year, where we signed 40 hotels last year. This year has started very strong. In Q1, we should be signing about 25 hotels in Q1. So it's giving us a great momentum for this year. And hopefully, for the full year, in term of -- on the food side, of course, we maintain its leadership position through product innovation, lifestyle marketing and also leading the share of social media engagement in spite of the softness in the market here in Thailand. Moving to Minor Hotels. Looking at Q4 2025, we actually completed renovations of our 5 flagship properties in Thailand delivering a post-renovation ADR uplift of almost 20% to 40%. That's a huge increase post renovation, where, as I said, using capital where we are getting a much higher return in terms of return on invested capital as well, which clearly demonstrates the pricing power of our luxury positioning of our brands as well. So last year, we had about 12 of our key properties, which were under renovation globally and including Anantara Siam here, where we have completed half last year. We just started the other half this year. So we should be fully completed by June, July of this year. And when you come for the next analyst meeting, you will see a totally different ballroom as well here. So these initiatives have increased the contribution of nonroom revenue, including supporting higher repeated visitation and also strong loyalty participation as well. So for example, this hotel, we've really moved ADR up. I was talking with the GM today. We're looking at an ADR of -- on the new rooms of 9,000 to 12,000-plus going forward, which is a big uplift here. So another key highlight is the contracting. So as I said, we signed more than 10 asset-light contracts in Q4 alone last year, spanning into Europe North America, Asia, Middle East, Lat Am, Latin America and also the Oceania as well. So globally, our footprint is growing quite strong in all the regions. And we -- as I said, we're not focusing on signing the number of hotels but signing sustainable quality of earnings as well. The -- some of the hotels we signed like Europe, we signed 1 hotel in the U.K. So U.K., we will have 1 new hotel there. In Asia, we signed 4 hotels in China, 1 hotel in India and 1 hotel in Thailand. In Lat Am, we signed a hotel in Brazil. In North America, we signed 2 hotels in the U.S. This is going to be a great entry point for us in the U.S. And in the Middle East, we signed 1 hotel and 1 branded residence in the UAE and also in Saudi Arabia as well. And Oceania, we signed 1 hotel in Australia. That was Q4. Looking at this slide here, the 2025 also marked asset-light expansion as well. So across 2025 and the first quarter to date, like I mentioned before, we signed over 45 new contracts in the key global markets, including the entry into the U.S. with the Wolseley hotel entering New York for the first time and also Anantara, first time in Miami entering Anantara Hotel and really high-end residences as well in Miami. So the 2 flagships in the U.S., which will elevate also our global positioning as well. Here in Japan, we signed the joint venture, as we know, targeting 25 hotels over the next decade with signing already of Anantara Karuizawa, which is scheduled to open in 2030. So Japan is a joint venture, which we signed, and we've already signed 1 hotel there with the Karuizawa Retreat, which will open by 2030. In Europe, we've expanded into the Mediterranean, which we just announced last week, actually, where we have entered into Croatia and Slovenia for the first time again, with Anantara and Minor Reserve Collection. So Minor Reserve Collection is another soft brand, which we created. And under Minor Reserve Collection, we have 1 hotel coming in Slovenia and under Anantara, 1 hotel coming in Croatia. These are rebrands. So these are rebrands from other hotels. So there is no delay in terms of greenfield. These hotels will start to open or will be rebranded by this quarter. In Egypt, we have a new growth frontier, as we know, in Egypt, where we partnered with Sunrise and the target is to do 50 hotels over the next 10 years. So that's another joint venture we signed and it's an asset-light JV, where we will open -- the target is to open 50 hotels over the next 10 years. Egypt is a big market, as you know, especially for the Europeans, it's a gateway as well. And it's a market where we have no presence. So we are going into -- we have gone into countries where we have no presence like Japan, like in the U.S. and also in the Mediterranean and now into Egypt as well. We've also sent in our African footprint with NH Collection going into Tanzania and also Ghana as well. So again, NH Collection is spreading quite a bit nicely outside Europe and Lat Am or the Americas going into the other countries as well. In India, we have secured and we've signed 3 hotel management contracts, which is one was in Anantara Kolkata, Anantara Coorg and the Avani plus in Vizag. Again, as we know, India is becoming a key market for us and it's growing quite well, both inbound and outbound. We were very successful opening our first hotel in India in Jaipur 2 years ago. And based on that, we are now picking momentum and signing more hotels in India as well. So overall, the pipeline provides a strong multiyear visibility and fee-based earnings without putting too much pressure on our balance sheet. So this is more going into what we said in terms of our asset-light strategy, leveraging our brands and the equity of our brands. Moving on to food. The food continued to demonstrate the strength and scalability of its platform. During the quarter, we expanded regionally, particularly adding 40 stores domestically here in Thailand and also 10 in Indonesia under Dairy Queen, GAGA, Bonchon and Poulet. Innovation remains a key focus on the Food group. The GAGA has also launched a new specialty tea series, and we have seen the earnings and sales driving 10% on the cup sales in the same SKUs. Bonchon Korean fried pork has delivered 8% incremental sales in its launch in the first month. So again, we're trying to revive or refresh, we keep refreshing our brands all the time. Ramyeon also recorded 103% increase year-on-year, reflecting a strong consumer traction here in Thailand, whilst the broader market was still soft. We also introduced new brand concepts in Thailand. So we launched Krob Krob Station and elevated the Thai sweet food concept, which is centered mainly around crispy pork belly. In Singapore, our innovation hub introduced what we call the Dim Sum Club, expanding dim-sum alongside noodles, rice bowls and desserts. Internationally, we entered India in the food side. With the launch of Scoop Wonder, I'm sure you know Scoop Wonder, we did try it out here in Thailand, which was quite successful, and we rolled out Scoop Wonder in December in India. And also Sanook Kitchen will be launched in January -- was launched in January as well. We partnered with a company called Devyani International, who is a leading QSR operator, positioning us well to scale the high growth in a highly population area as well, which is India. So new concepts are being -- are helping us to attract broader consumer segments and driving traffic. Sizzler introduced what we call the upgraded sizzler special, featuring like what we call the premium health-oriented options and the Sizzler Moon & Sun or Sun & Moon for the first ever dual concept format, offering differentiated day and night menus for Sizzler as well. The Pizza Company also launched the Pizza Company Express, a new grab-and-go concept and the store concept to target individual diners and convenience-seeking consumers as well. So overall, the innovation, new concepts and disciplined expansion on the Food Group will support both growth and also the balance in terms of relevance as well 2026 and beyond. So 2026 and beyond our aspirations. So looking ahead, we have some clear measurable financial ambitions, which we are showing here. In -- by 2028, we aim to reach about 850 hotels and 4,150 restaurants. This is including signed contracts, opened and signed. The expansion will be driven mainly by an asset-light strategy, selecting some of the new markets, which I explained before. And we continue to look at more of the new markets as well, and much more deeper penetration into high-growth regions as well. So financially, our 3-year targets remain unchanged. We are targeting, like I said, a high single-digit revenue growth and a 15% to 20% annual earnings growth and our ROIC at 12%. So at the same time, also remain focused on the balance sheet including successful execution of unlocking some of the initiatives where we target the net debt to equity to be in the range of 0.75 to 0.85 and net debt-to-EBITDA below 4x. So that's our target from -- for this year and beyond. And I'm sure like a lot of you will also ask me about net debt to equity, including perps. At the moment, it's about 1.7, 1.8, we hope to bring that down to about 1.4 in the coming years. So moving on, then when we look at the hotel pipeline, our expansion strategy prioritizes what we call quality over quantity or the number of hotels instead of saying that we're the largest -- we have the largest number of hotels, we would love to say we're the most profitable hotel brand globally. And I will also show you why in the coming slides, because we've had some of the larger brands have actually published their results, and I can compare how we are benchmarking against them as well. In 2028, more than 50% of our hotel portfolio will be -- by 2028, more than 50% of our portfolio will be asset-light. That doesn't mean that we're not going to grow assets. We will continue to look at stronger base return investments but at the same time, focus more on asset light, which is signing more management contracts and more -- moving more into franchising as well. So franchising is something, which we've launched last year, and it's starting to take some momentum this year. And next year, we will see a stronger momentum, signing more franchise contracts as well. So geographically, we continue to deepen our presence in established markets, including North Africa, like Morocco and Egypt, like I mentioned, Egypt, we've signed; Morocco, we are pretty close to signing something as well. And also North Asia, like Japan, South Korea and Middle East and the Caribbean, including Middle East, including Saudi Arabia as well. And the Caribbean also like we're looking Turks and Caicos and some of the other Caribbean regions as well. So from a brand perspective, while luxury and premium brands like Anantara, Tivoli, NH Collection are expected to grow at an accelerated pace given the rising brand recognition across the multiple markets in Europe and also in Asia as well. So this strategic fit will help us to balance our portfolio across most of the geographies and also the brand tiers as well in terms of really driving that asset-light growth. The next one is to look at the additions of -- the new additions. Just want to show you some of the new hotels, which we've signed or which will open in 2026. So I'll say, for example, we -- for the first time, we have Anantara Kafue, which is a tented camp. So Anantara is also going now because we do have a brand, which is called Elewana which focuses around safaris and tented camp. We now have Anantara also now going into a tented camp -- very exclusive tented camp in Kafue in Zambia, which is like 12 keys, and this is managed. We have Kota Kinabalu, again, which is opening in Q2 2026 with 352 keys, again, again managed. The same quarter, we'll have Tivoli in Muscat in Oman 130 keys, managed. Tivoli in Bahrain in the last quarter about 95 keys and 107 keys because we have a Tivoli and a Avani, which again will be managed as well. Avani in Vientiane, again, will open in the second quarter, almost 200 keys, managed. And then the first Avani hotel, full service hotel in Mooloolaba in Australia, will open in the second quarter as well, 160 keys and our franchise hotel. It's a franchise. So we have about 7 franchises already in Australia. So we're growing quite well in Australia on the franchise side. So again, this is asset-light. And then we have Anantara in the Snow Mountain, again, a managed hotel in the last quarter. NH Collection in Malta, it's a new country, new entry, 181 keys, franchise. And in the second quarter, we have the Tivoli, which is 45 keys, again, under managed contracts. So as we can see, all these are managed or franchise under the asset-light model. So it doesn't put too much pressure on our balance sheet. Looking at the global travel demand. So again, here, I'm sure there's a lot of concern about travel demand, there's concerns about currency, ForEx. There's concerns about trade wars. There is concerns about trade -- the taxes. But we believe and we have seen in 2026 that the travel -- global travel remains quite resilient. And Q1 also, we've started Q1 with a good head start, which means global travel continues to be resilient and continues to benefit from higher rates as well as long as the strategies the current one in terms of driving our rates up. So in Europe, the leisure business travel continues to show solid momentum with robust calendar events throughout the year. As we all know, the Winter Olympics, the Grand Prix and then in Minor Hotels, like we have presence in major urban gateway cities, which will help to benefit from these events as well. In the Middle East, the leisure demand is supported by improved air connectivity as well and the national tourism initiatives, which they are doing, which continues to gain momentum in the Middle East. In Thailand, in particular, we will benefit now from a proactive government in terms of tourism initiatives, increased flight capacities and major regional high-profile events, which will also drive incremental demand for Thailand as well. We saw Thailand 2 years ago how the demand rose up when we did the white loaders. And the demand continues to be there, and the demand continues to attract high-end travelers as well to Thailand, which is great, which means we're getting higher rates and also long stays as well. In Australia, the domestic events, again, are supported by some of the major sporting and entertainment events, including the Australian Open, the Formula 1, which is also helping us as well. And we've seen that coming through our demand drivers in these countries as well. So I think for us, 2026, some of the headwinds -- the key headwind on 2026 is the ForEx. Apart from that, we -- because we see the continuous weakness of U.S. dollar. And apart from that, I think all the other indicators are quite strong. And as we have seen, we started Jan and Feb, both Jan has been a very strong month compared to last year and Feb has been pretty good, even the Chinese New Year has been quite good for us as well. Moving to the next one, in terms of strong growth in branded residences. So this is something where we are really leveraging our brand strength, which is branded residences. So branded residences, the market itself is rising globally because of the wealth creation and the growing demand for experience-led living. So as we all know, most of the high-end brands have created residences. So we were one of the first to create branded residences back in the early days, even before Four Seasons had branded residences. Our branded residences in Samui was at the Four Seasons, when Four Seasons didn't have branded residences. So we called it The Estates. Our branded residences in Chiang Mai at the Four Seasons, call it the residences at the Four Seasons -- in Chiang Mai the Four Seasons and also the branded residences in the same region. So those were our initial step into branded residences. We then -- since then, we've launched our own branded residences, which has been very, very successful. For example, Layan, we are into Phase III now, and I will show you the branded residences, how it's contributing, and you will see the contribution as well. So again, this -- yes, it has a capital drain in the initial years. But as soon as the project is complete, we see 25% to 30% return on the capital investment as well, which is quite attractive when we do branded residences. So we have many of the branded residences project both here in Thailand and also outside Thailand as well. In the Middle East, we've signed quite a few. In Dubai, we already have branded residences. We're signing more. In Malaysia, we have. So we continue to expand the branded residences, which we see that even on a stand-alone basis, these branded residences can be highly lucrative, giving a very strong return. So this is the growth of the branded residences market. So this is -- this gives you a flavor of what the branded residences are doing today. So it's I think -- it's another segment, it's another vertical, which we have leveraged ourselves in terms of taking advantage of the growth. The next one is our pipeline on branded residences. So this gives you an idea of what we are doing. So the first one is 2026 and beyond, unlocking value. As you can see on the left-hand side, our branded residences product is highly capital efficient. The IRRs are up to 30%. So very strong IRRs. And we have the Kiara, the branded residences, the Phase III, which was launched in 2024, and 2026 is when we will start to complete or completion of sales of signing these new contracts, which we already have sold. Ubud, again, we have 15 villas for sale and we will start to sell them this year. Four Seasons Samui, we have 3 units, which we've done. Again, we will start to sell them here as well. And then we have another 500-rai project in Thailand, which is at Layan, the same place where we will continue to expand Phase IV, Phase V, again, giving us very strong returns and also strong for the brand as well. On the right-hand side, you see the branded residences where we have signed on a fee-based basis. So here, we have no investment. We only are branding. So Anantara, Miami, again, is branded residences which will complete in 2 years. Oaks, Riyadh in Saudi Arabia, again launched. Tivoli in Muscat, the Tivoli and Avani in Bahrain. Anantara Zanzibar is also branded residences and hotels, which we are selling. And Anantara Ras Al Khaimah is the hotel which we launched 2 years ago, and the hotel has been very successful and the owners have launched branded residences, Anantara branded residences, which actually sold within a week, and that's how much demand there is for branded residences in the Middle East. And then we have NH Ras Al Khaimah, again, another fee-based project. Some of these branded residences can get us fees up to $15 million to $20 million each on the residential side based on each of the projects. So it's -- the pipeline is very strong, and I think it's growing quite well. So we will continue to focus. The regional focus is Middle East, Africa, of course, Asia, Europe, Lat Am, U.S. and the Caribbean as well. This is purely on branded residences. So the next one is the -- on the food side, which is continued food expansion with asset light. So similar to our hotel asset-light strategy, the expansion remains central to Minor Food, the growth model as well. By 2028, our franchise outlets will account for a larger share of our network supporting the margin stability and also strong cash flow generation as well. Geographically, we are prioritizing high-growth markets, such as India, Indonesia, alongside continued expansion here in Thailand and also the broader Southeast Asia as well. Coffee Club has gone into Africa. Coffee Club has gone into the Middle East, both -- in Africa, it's mainly a franchise model, which is good, so which we will continue to expand those markets as well. So it's moving more into an asset-light model by region. The next one is Minor Hotel (sic) [ Minor Food ] as the leading restaurant platform in APAC. So as we know, Minor Hotel -- sorry, Minor Food position itself as a multi-brand restaurant platform with growth potential. We operate a mix of own brands which gives us strategic flexibility and control, alongside some of the franchising or franchise brands, which we manage as well, which helps us to enhance scale and also capital efficiency as well. In most markets today, as we see on the right-hand side, wo own -- we hold #1 position across the key categories whether it's pizzas, whether it's desserts, whether it's Korean-fried chicken, and also which reinforces a strong presence and leader and leading into some of the major consumer segments. The centralized procurement has strengthened our cost discipline, which has really helped us in the last few years. In spite of costs going up, we've managed to keep our margins quite tight, mainly because of centralized procurement and also the ability to be the best in class in terms of operational know-how and also the hubs where we can start to roll out our brands, which are much more standard way as well. So these advantages actually will translate into what we call a superior unit economics. As we said, Minor Food also has very strong aspirations to get to about 4,500 outlets by 2028. Moving on to how Minor Food is elevating its core brand and scaling expansion both on the innovation side, on the expansion side with the help of digital initiatives. So on the growth, we will continue to be driven by the 3 key pillars like we said here. On the menu side, we will continue to enhance the creativity, add new concepts, new product developments and also compelling value offerings as well. Because as we see the Thailand market softening. People are looking for more value-driven food. And this is something we have also gone into and we are helping as well. So for example, like when we launched Sizzler, we have Sizzler and then we also launched Steak & More, which is more of a value concept value meal, which has really good quality because of our chain. But at the same time, we are playing with high value and low value ticket checks as well. So in Thailand, the expansions include Dairy Queen, Stake & More, GAGA, Bonchon and The Pizza Company. Internationally, Indonesia is emerging as a strategic hub for us. Indonesia, like we went in with Dairy Queen, which has done really well. We are opening more outlets now. We've also now introduced GAGA in Indonesia, which has also taken off quite well. And therefore, we are really spearheading that and expanding into Indonesia quite strongly as well. India is another market on the food side, where we are expanding with a local partner. And also, we will accelerate the rollout of Sanook Kitchen to capture another strong potential in India as well. In CLMV, Vietnam and Laos remain key markets for asset-light expansion on the food side and the digital expansions, the digital initiatives are also enhancing both the revenue creation and also the operations efficiency as well. At the store level, technologies such as we've introduced Order at Table, we introduced Pay at Table, we've introduced QR ordering, we've introduced kiosks to improve the customer convenience and also accelerating our table turns and enhancing productivity as well. The next slide is to talk about profitability expansion road map. So the key drivers include here is cost efficiency, lease optimization, high direct bookings and asset-light expansion. So together, these initiatives will improve us to drive both EBITDA and continue to drive net PAT margins or net earnings throughout 2028 as well. So the key drivers -- so we expect the margin expansion to accelerate towards the latter part of the year or the 3-year plan in terms of when we start to really see the asset light expansion taking shape and really gaining momentum, both on the management contracts and also on the franchising side as well. So in addition to this, the lower cost of debt and continued deleveraging will further support our core net earnings and enhance our overall earnings quality as well as we continue to deleverage, we will see a cost of cost of interest coming down, which will help with our net earnings going up. The next one is to give you some progress and some color on how we are unlocking. So we have the unlocking of the REIT IPO, which we have announced last year. It's on track, so it's progressing quite well. And the target is the second half of the year. on the REIT side. We have been debating whether it's going to be a Sing REIT, whether it's going to be a Thai REIT, and we have come to a conclusion that it has to be a Sing REIT. So therefore, we're moving fast on that in terms of getting the regulations and paperwork finalized and submitted this quarter, which will help us to launch by the second half of the year -- of this year. So we are currently structuring the REIT. We targeted gross asset value of over USD 1 billion, comprising assets here, mainly in Europe and also Thailand. Some of you might ask like why? I think we earlier said it would be about USD 1.2 billion the REIT value but we've dialed down to about USD 1 billion to make sure that to ensure we have the assets where the asset values are enough for us in terms of REIT realization to reduce our optimum size of the debt. So therefore, we've now come to USD 1 billion. And some of the assets, which were a little bit difficult to put into the REIT in Singapore, we've taken it out and to make sure that there is no delays in terms of launching the REIT. And therefore, that's also reduced the REIT value to USD 1 billion. In terms of the yield. We aim to position the REIT in line with the upper tier of the hospitality REIT companies in Singapore in the SGX. So importantly, the yield would yield below our current cost of capital, which will support our overall capital efficiency. Some of you might ask the cost of the yield on the REIT might be a little bit higher than cost of debt but we actually look at cost of capital, which includes cost of equity as well. So when we add cost of equity, paying recycling assets through the REIT is much more beneficial and much more -- it adds to -- it makes our balance sheet look much stronger, and it makes our earnings also look good, and therefore, we've actually looked at the total cost of debt in terms of launching REIT. From a financial perspective, we anticipate a material balance sheet strengthening and continuous year-on-year EPS growth post REIT IPO. So the target is to ensure that we deleverage and the target is also to ensure that we increase our earnings per share in the coming years. So post transaction, the deleveraging will lead to a lower cost of capital over time, driven by stronger credit metrics and also lower company-specific risk premium as well. So I think it's -- the deleveraging is a strategy we have always been focusing on prior to COVID. During COVID, we accelerated some of the deleveraging strategies, including asset rotation, sale of assets, which has really helped us in the last few years and also brought our interest cost down. And this one will further strengthen our balance sheet going forward in the coming years. But also the REIT will enable us to add assets put into the REIT where we might -- where Minor International might not be able to meet from an earnings perspective but it will fulfill the REIT criteria, which will also help us to grow on a without putting too much capital or without putting -- using our balance sheet. So the whole point is for the REIT to keep expanding and the REIT to continue to grow, so we can inject more and more assets, which we can manage in the coming years. The next one is 2025 recap, I think most of you have had a chance to look at it, look at our press releases and also what we've announced in the market. As we all know, the fourth quarter 2025 demonstrated a strong underlying momentum. Minor delivered a core revenue of THB 43.8 billion, which represents a 5% year-on-year growth. And this was delivered both by the hotels and restaurant performance. At the core net profit, we achieved THB 3.5 billion, which was a strong growth of 21% year-on-year with the ability to capture demand and also benefit from lower interest rates following the reduced cost of funds. So that's Q4. And this is Q4 where we have seen a strong momentum in spite of some of the markets actually being a little bit soft, in spite of having some of the currency headwinds as well. So we -- so the growth has been very strong for us in Q4. For the overall 2025, this is 2025 full year. The full year, the core revenues reached THB 165.5 billion, which is a 3% increase year-on-year on a constant ForEx basis. And the core net profit increased, as we said before, 16% year-on-year to THB 9.7 billion; again, reflecting a strong hotel performance and improved food earnings with effective cost management and also reduction in finance costs. The 16% profit growth was in line with the guidance, which we provided to our investors, reflecting a strong execution against what we had as our targets in spite of, as I said before, a lot of the headwinds, our key properties under renovation, currency headwinds, global -- some of the global meltdown, whether it's trade wars, whether it's the taxes. But we've managed to actually disclosed a 16% growth on profit year-on-year for Minor as a company. This one -- this slide is quite interesting actually because for Q4, the Hotel performance. So here you see by region, we show by region, the RevPAR by region. Europe and Lat Am RevPAR grew by 6%. Thailand, the RevPAR grew by 15% year-on-year. For the Maldives, again, has been a very strong quarter. The RevPAR grew by 13%, and the management letting rights predominantly in Australia, our RevPAR grew by 6%, and our managed properties are RevPAR grew by 10%. So that gives you a pretty good color in terms of how we -- the strategies and the rates we've managed, whether it's in power with occupancies and how we've grown the RevPAR quite high. So compared to our peers who are like 4%, 1.9% and 0.5%, our RevPAR growth was more than double, it's 9.2% the RevPAR growth for Q4. So that gives you an idea in terms of how the RevPAR has grown. It's a 9.2% growth, which is higher than everyone. On the fourth quarter, the RevPAR, the growth was very strong as we see. The owned and the leased portfolio, both in Europe and the Americas, RevPAR increased by 6%, like we saw down with dominantly led by ADR increase. So ADR growth was 4% of the 6%. In Thailand, our RevPAR was 15% growth, driven by ADR following the flagship properties and strong performance in some of our resort destinations and some of the renovations actually coming into fruition as well. In the Maldives, we maintain an exceptionally strong growth the RevPAR in U.S. dollar grew by 13% year-on-year, which was mainly what we diversified our markets into Russia, U.K., Germany and the UAE, which actually helped us to grow the RevPAR. The Australia performance has improved with a higher average room rates, and the strong school holiday also helped us as well and our managed hotel recorded RevPAR growth of 10%, which is quite high. So we are recording double digit -- almost double-digit or high single-digit RevPAR growth across all the markets. So that's for Q4 of the hotel performance, you see. And then the 2025 hotel performance, the full year, again, remains quite robust with Europe growing by 5%, Thailand growing by 5%. In spite of -- this is full year -- so in spite of Thailand, as you know, in the early -- in 2025, we started with the Chinese kidnapping, then we had the earthquake, then we had the floods, then we have the trade war, we had the political instability, in spite of all that, Thailand for the full year, still showed a 5% RevPAR growth for the full year. But the last quarter of Thailand grew by 15%. So you can see how the RevPAR is starting to ramp up. Maldives grew by 19%. Properties in Australia, which is in management letting rights grew by 2% and our managed hotels were flat. On the Food side, so the Food delivered a 4% year-on-year growth in the fourth quarter, mainly the growth was attributable to top line improvements starting to see in China, Australia and together with a better contribution from our joint ventures. The Thailand recorded same-store sales and total system sales decreased by 3.5% and 1.7% year-on-year, mainly due to the government copayment system, which actually excluded the chain restaurants and diverted spending into local operators. So that had an impact on our sales here in Thailand for the Food Group. Nevertheless, the brands such as GAGA, Burger King and Bonchon maintained a positive momentum with stronger sales growth. Internationally, the same-store sales growth declined slightly by 1.8%. As China improves, Indonesia and Vietnam couldn't offset the balance of the other portfolio internationally. Despite of -- despite this, the total system sales increased by 0.6% year-on-year, which -- where it's continued to see a network expansion as well. On the bottom line, the net profit rose to 6% year-on-year with the net margin improving to 8.6%, which was above last year, which was 8.4%. And the improvement was supported by stronger profit sharing through Thailand and enhanced cost discipline in China, particularly on the labor side as well. The next slide, we show the Food performance for the full year. The core revenues increased by 4% year-on-year on a constant ForEx basis. The Thailand same-store sales declined by 1.7%, as I said, the reasons before, with a softer sales we've seen because of the government co-payment system, which we didn't benefit, and that had an impact as well. Also, the earthquake also had an impact as well. And the floods in Thailand also had an impact on the Food Group as well. So looking at core net profit, the Minor Food reported 6% growth year-on-year at a constant ForEx to about THB 2.6 billion for the full year. The next one is all about CapEx, allocation of capital for growth. So we expect the CapEx to hover around THB 15 billion to THB 16 billion. And mainly, a lot goes into the branded residences, the development, which we sell, which gives us a very high ROI. We are -- this also includes Hotel maintenance and upgrade CapEx as well. So as we start to -- which actually has a payback so which we have demonstrated in our RevPAR growth. As I said, our RevPAR grew quite strong in Q4, mainly because of some of the CapExes, which have where we spend money and we've managed to increase our rate. So I think we've been -- we continue to be focus a lot on CapEx to make sure that the CapEx is controlled in terms of from a cash flow as well. And most of the CapEx projects will be driven by ROI and also supporting a higher margin as well. The next one is on deleveraging and capital allocation. So the net debt metrics will continue to improve. Interest expense declined 17% year-on-year, and the cost of debt fell to 4.8%. So this creates flexibility to deleverage further and also return value to our shareholders in terms of higher net earnings as well. So our net interest-bearing debt to equity stood at 0.86. Our net debt-to-EBITDA stands at 4.6 as of the end of 2025. So it's slightly higher on a year-on-year basis, mainly due to some of the cash, which we use for the delisting of MHEA last year and also the interim dividend, which we paid out. However, on a quarter-to-quarter basis, our leverage metrics improved and supported by reduction in interest-bearing debt. In 2026, by the end of 2026, we see the net debt to equity coming to a range of 0.75 to 0.85, more towards the lower and the net debt-to-EBITDA coming below 4%, so bringing that below 4% as well. Our debt profile on the fixed funding has increased to 58% at the end of 2025 from 55%, so fixed to floating. And we continue to maintain a higher fixed rate exposure, given limited room for further rate cuts by the central banks, including ECB and also BOT as well. In addition to this, Minor has been able to issue a fixed term -- a fixed rate Thai bond at a competitive price, enabling us to lock in attractive long-term funding as well. So that gives you a color on how the net interest-bearing debt to equity is managed. You can see it's coming down. It slightly went up the last quarter last year because of the MHEA delisting and also some moneys going into the dividend payment as well but it continues to decline in the coming years, and we hope to bring it down to about 0.75 to close to about 0.75. And the net debt-to-EBITDA the target is to bring it below 4%. So in summary 2025, was a year where we have delivered some very strong performance in spite of some of the headwinds we've had. We are entering a new phase in 2026, more moving into what we call scalable fee income on an asset-light basis, unlocking asset value through REIT and growing through disciplined growth through even branded residences, fee income on that franchising on the food side, more into asset-light growth into some of the new markets and diversify our risk portfolio a little bit from Thailand to outside as well. 2026, looking ahead, we will continue to deleverage, providing greater flexibility to enhance the shareholder return and higher dividend payments as well. So on that, I'd like to thank you all for listening. And that concludes my presentation and happy to open up for Q&A.

May I ask what would be the maximum yield you are willing to offer for REIT?

Sorry, what is the maximum?

Yield on REIT.

So that's something we are working on because, of course, it's going to be a Sing REIT. We need to be competitive with the others big Sing like CDL and like that. So we think it's going to be higher 6.

And how much of the hotel assets in Thailand and Europe you plan to inject into the REIT?

The plan now is to inject about 14 assets, 12 from Europe and 2 from Thailand. Earlier, we had a plan of Maldives but Maldives become a little bit too complicated. So we took all this out. And now we are just focusing on Europe and Thailand.

I see. And how that would affect your future hotel revenues?

Actually, when you look at the REIT, we will still own 49% of the REIT, where we will have control. I think, yes, there will be -- I think we are trying to manage it carefully to ensure that we don't see a sudden drop. But I think overall, we will manage our earnings per share going upwards. The first year of the REIT because of the structure of the REIT we may have to write off some of the costs, which will have an impact in 2026, just one-off costs. But then on a core level, it should be fairly flat and growing upwards.

Okay, I see. And for the REIT, since majority of the hotels would be in Europe, would it be better to be listed in maybe in U.K.?

We looked at it. We actually did the exercise. We've done this -- we've been looking at this exercise, not this year. We started 2 years ago. In terms of identifying the best value proposition for Minor Hotels and Minor International as a company. We looked at bringing a shareholder at NH level or at the European level. We looked at doing some of the asset recycling and then we looked at REIT. The REIT gave us the highest IRR. And then we looked at different countries as well. Of course, our first preference was Thailand but then Thailand became almost difficult in terms of launching the red because the REIT is not seen as an equity instrument here. But we also saw the Sing REIT much more attractive because people -- there's more investor base and there is more capital flowing there from the Asian markets, which will help us as well.

I see. And of the USD 1 billion REIT, how much you plan to pay down debt and...

And so I think the plan is that the majority of the funds will go to pay down debt. And we will -- of course, we will have funds available for expansion because I think it's important that we pay down debt at the same time we continue to grow as well. But most of the growth will come through asset light. So our feeling is that a lot of the -- the majority of the funds or the proceeds will go to pay down debt.

And so do you plan to hopefully 9% stake in REIT, so REIT will not be consolidated into in Minor financials?

It would be because we're looking at -- we will have -- technically, we will have control. So we could consolidate.

I see. And how much fee you expect to earn from managing the REIT?

So that's something, which has been finalized. So it's not -- so we are now setting up the structure. We've set up the entity we're bringing in the people because you have to have people based in Singapore, and we should be filing our REIT papers by -- before the end of March.

I see. And on the Hotel business, how much RevPAR you expect to see in 2026? And what will drive it from occupancy or from room rate?

The main driver of the RevPAR because of the renovations will continue to come from ADR, from rate, like same as last year. So last year, you saw our RevPAR growth compared to our peers, which was way high. This year, I think we will see a fairly close RevPAR growth, maybe anything from 5% to 10%.

So which market will be your key driver?

All the markets. Asia will continue because of the renovations done here, like we have, as I said, like we had 12 hotels under renovation last year, which actually impacted our top line. That's one of the reasons we didn't see enough of a top line growth. For example, this hotel was almost we suffered a lot because of the works, and we will suffer this year as well for the first 6 months. But the others have started to come in, and we see the growth. So most of the growth, as I said, will come through Asia because you see Thailand has produced like a 15% RevPAR growth. Maldives will continue to grow stronger, like Maldives I was looking at Jan and Feb numbers, which is very strong even compared to last year, which is on a higher base. And Europe continues to grow in spite of all the noises we are hearing.

But some countries are also imposing sort of tax or whatever because there are some concern about over tourism?

Yes. This has been on for last 2 years, right? Spain did that, Barcelona did that. Amsterdam has introduced city tax and tourist tax. But people are still traveling. A city tax is EUR 10 per night compared to a rate of EUR 200, EUR 300. If you have to travel, people will travel. They're not going to be too much worried about the taxes. Over tourism might be an issue. But again, most countries are controlling it. And -- in a way, it benefits us because it benefits us that we are in the higher segment. So at the higher segment, like that's the income the government wants. It's not the lower segment where people come, pay really cheap rates, don't spend any money, abuse the environment and leave. So in a way, it actually plays to our benefit. And barriers of entry also plays hugely to our benefit because if you look today, in Italy, you cannot build any more hotels. You won't get licensed in the key cities like Florence, Milan, places like that, no more hotels, which is great.

Okay. My last question would be what's your biggest concern for this year?

I think the headwinds we are facing, like one is the ForEx and the other one, of course, is the geopolitical climate because which we have to navigate almost on a daily basis because from 1 week to another, things change quite rapidly. So the good thing is -- the good thing is our system is so tight and so efficient from the organization level, like where we are able to be much more agile and much more faster, making decisions much more quicker as well. So that's helped a lot.

But you are not concerned about the launch of REIT -- sir, the launch of the REIT in Singapore, you are not worried about how?

No. Actually, I'm happy that we're launching the REIT because that helps us to deleverage.

Sure. But what would be your alternative?

The alternative is -- we've looked at other alternatives. We looked at asset recycling. We looked at bringing an investor at the MHEA level. We looked at selling assets on hold. But then that has compared to a REIT. The REIT was the most effective gives us the highest IRR on a continuous basis for Minor. And that's the reason we actually choose REIT as the option.

So you mean you're going to do just one of them or you can do both? I mean, like food IPO or...

So as we all know, there is 2 things, right, in terms of the road map. We -- number 1 was the REIT, which is progressing much faster, and that will happen by second half of the year. Of course, we are looking at food IPO and we are exploring options to see. At the end of the day, we look at what's the best value add to our shareholders. And how do -- is it accretive or not accretive? If it's not accretive, I will be worried, and I will -- we will not do it. But if it's accretive, I think all our shareholders will support it, and we will do it because I think it's really important that anything -- any of the strategies which are accretive to deleverage the biggest concern, like number 1 concern, like our share price has been quite low compared to what was happening in Thailand in spite of us showing earnings every year on a higher basis. But now like with the markets coming back and our share price moving up, the next thing is our deleverage. It's important for us to deleverage and really show control of our cash flow. And once that is done, I think you will have the overhang lifted which would be helpful, which would make me and most of our shareholders or all of our shareholders happy.

Dillip, can I have a couple of questions? So on that note, my first question is, we see the guidance for leverage coming down, but it's a consequence of the REIT and the full IPO are happening. So what would be the leverage target if those 2 things doesn't happen? And then we can start there first.

Okay. So the first thing is our leverage target. On a DE basis, it's to bring it down to about 0.75 excluding perps, including perps, today, it's about 1.7-something. We want to bring that to 1.4. So that's our target. So 0.75, 1.4 and DE below -- sorry debt-to-EBITDA below 4.

So even if these 2 things doesn't happen, will you still be able to get there or will find a way to...

So these numbers are -- that's a good question. Actually, these numbers are based on the REIT IPO, right? We haven't factored in the food because there are quite a few unknowns in terms of that, which is progressing. It doesn't mean we've stopped. So we're looking at both at the same time. But I think the REIT will happen for sure in the first, second half of the year, which will then bring down our DE, our DE including perps and also debt-to-EBITDA to about 4 or slightly below 4.

So as per your comment earlier that majority of the REIT proceeds are going to be used to repay down the debt, right? So is it fair to assume that if the REIT doesn't happen, then the leverage level probably stay constant? That's the case, right?

Yes. That's not...

I get that. I understand. Then the second question following that is when you -- if both of these things happen, your leverage come down to 1.3x, 1.4x on the net debt to equity basis. That's your comfort level, right? That's the level we've always heard Minor talked about over the past 10 years. So what's next after that? Are we looking at more asset expansion after that again or are we...

No, we will continue to expand on asset-light. I think our internal -- the banking covenants was 1.7 net debt to equity. Our internal target has always been 1.4. So we will get it down to 1.4. And once we get it down to 1.4, we will then continue the growth, mostly through asset-light and the asset-heavy ones will be the real estate developments, which will have a 2-year cycle or a 3-year cycle where it will mature and then you will get the cash out. So this year, I think we should buy 24, we will get a pretty good cash out from TRR, the residential project, which we have in Phuket, the Phase III. We now started Phase IV. So cash is going in. We're not stopping because we know the returns are good. The IRRs are like you're getting a 30% IRR, you will not get anywhere. So we will continue to take benefit of that. So the growth strategy will continue but more -- focusing more on asset light in the coming years and keeping to our internal discipline of 1.4 or below.

Okay. Then can I just rephrase and get a sense this way. Then if we have a look at your managed hotel revenue last year, it was flat year-on-year. And I can understand some closure and some new. But then each year that we see 50 to 100 hotels expected signing, how much of our revenue growth momentum on that can we expect...

So I think we showed the managed hotel how much we are getting, right? If you look at the slide here, we -- you can see the -- how many hotels we are going to get through managed. You can see the slice actually increases, which means the revenue coming through the managed hotels will also -- but it's mainly fees, fee income. Don't forget the fee income is not as high sometimes as your equity income, right? Because, like, say, for example, in the Maldives, we own -- let's say, we owned Kihavah, we make about TBB 15 million to THB 20 million EBITDA, net profit is about THB 10 million. That is THB 10 million to us. But if we have to manage hotels, maybe the fee income is $300,000, $400,000 per managed hotel so you had to really build up that momentum to really move the needle up quite fast.

But then -- okay, sorry, if I'm repetitive. But I just want to get a sense like from 600 hotels to 850, how much EBITDA growth we can generate from this? Like how many percent of proportion of the growth that will come from going asset-light essentially, right? That's what I'm trying to get at.

Okay. So I think if you look at the growth of going from 600 to 850, 80% of that will come through managed or asset-light, 80% of the hotels, right? 20% will be leases and some investment. So that 80% will contribute. You have to then work it backwards like that if we assume that our net earnings will grow every year by 15% to 20%, like say, it's going to grow by 15%. So you said that net earnings will grow by 15% every year, out of which the contribution on the incremental net earnings, 80% will come through asset-light.

And then the last question from me is on CapEx. We see your CapEx going from THB 10 billion to THB 15 billion, 3 of the 10 last year was from MHEA delisting, right? So effectively, your CapEx is doubling this year. So my question is if a big portion of hotels were under renovation in 2025 already? What are these assets that needs uplifting and upgrades? And what are the impacts on the performance of the hotel side, if so many assets are going to go under renovation?

So if you look at the CapEx allocation, right, 4% is hotel expansion, right? Restaurant upgrades about 5%. The biggest chunk is coming from hotel maintenance upgrades, which is 65%. So like in a way, these are normal CapEx. It has 2 elements. One is the normal CapEx, which happens every year for the hotels, like the usual upkeep of the assets. And the second one is I driven CapEx. Here, like there will be more into ROI-driven CapEx. Like say, for example, like the bigger projects we have will be on the residential side, the next Phase III, IV -- sorry, Phase IV, V and VI. We're also looking at some other residential development. We're looking at renovating our JW Marriott in Phuket. We're looking at renovating us in regions here in Bangkok. So these are big CapEx ticket items, which will come, but it's driven by ROI.

Kun Dillip, I have a quick follow-up question to -- regarding the deleveraging target. So I understand that by the end of this year, those targets would be largely driven by REIT IPO. But just also would like to understand beyond that, what would be the free cash flow capacity for debt reduction from Minor organically beyond that REIT. So are we looking at potential upside on deleveraging that were coming from organic excess free cash flow as well? Or that upside would be mainly depend on further asset monetization from Minor Food IPO or more asset recycling into REIT down the road?

So the -- the slide here is based on the deleveraging on the allocation where we do -- based on our earnings growth, which is going to happen, which will also bring in cash flow. Based on the REIT, assuming the REIT will conclude in the second half of the year, and that will go to reduce our debt based on those and taking into account the CapEx, which we will have to spend and the dividends, which we will have to pay in any other bank loans or perps which we will materialize as well. Based on that, our debt to equity, as I said, will come down to in the range of 0.75 to 0.85. This is based on not adding some of the other initiatives.

So let's say, beyond 2026, given the capacity when it comes to free cash flow -- excess free cash flow, what would be the level of reduction that we can expect beyond 2026 without other asset monetization vehicles?

What would be the reduction of debt, you mean?

Yes. Organically going forward beyond 2026.

Yes. So what we want to do is to maintain our DE at the level of 1.3% going forward. And any cash then a higher dividend payout, the cash generation because, of course, our earnings will start to keep going up. Last year was THB 9.9 billion. This year, it's going to be THB 10-plus billion. So that will also help as well.

Okay. So would it be fair to assume that by the end of this year, Minor should be at the optimum when it comes to capital structure in your view already?

Yes.

Got it. And on the REIT, just a bit more. So now that assuming it's coming -- it comes through in the second half of this year. So now you would also have REIT as a perpetual asset recycling vehicle for Minor. So any rough target in terms of future asset monetization into REIT per year going forward? Or -- because you still have over the hotels that you own still. Would that be part of how you accelerate the asset-light component of your hotel asset portfolio, would REIT comes into that picture as well for future recycling?

Okay. That's -- okay, that's a good question. So I think we -- the whole purpose of the REIT really gives us the best value for Minor from an IRR perspective. Moving forward, when there are investments or when there are acquisitions, which might where Minor might not be able to do it because we want to maintain our 1.3 DE ratio. We could always do it through the REIT vehicle. So that's our thought process, which will then help us to really start to leverage our asset-light. But don't forget, again, on the REIT, we own 49%. So again, there will be some moneys going into that as well, but it will create that pipeline, which will continue to move upwards. Yes, I think if we do see assets because you're right, like we have -- we are quite asset rich in our balance sheet and if we see some of the asset monetization where we have reached the peak and then we might recycle that into a REIT.

Got it. So with that in mind, there's no target as of yet?

No.

Any more questions? While you can still send your questions afterwards to me or to IR team who will address all of your questions, pending questions. Thanks a lot for your participation today. There's no more question on the ground here right now. So we're going to close the meeting. And then if you have anything else, please send us questions, and we will try to address every one of them. Thank you for your participation today.

Thank you very much.