Good evening, everyone, and thank you for joining the Thai Beverage full year 2023 results call. All participants have been placed in a listen-only mode. Later, we will conduct a question and answer session, and instructions will be given at that time. I will now hand over the call to present us with Namfon Aungsutornrungsi, Thai Beverage Head of Investor Relations, and the members of Thai Beverage Senior Management Team. Thank you. Good evening, ladies and gentlemen, and welcome to Thai Beverage 2023, ended 30 September 2023, financial results conference call. I am Namfon Aungsutornrungsi, Head of Investor Relations. For the call tonight, I will start with a summary of the full year results, then we will open the line for Q&A with our management team. For the summary of the financial results, total sales revenue of the company for the year ended 30 September 2023 was THB 279,085 million, an increase of 2.5% when compared to last year. This was due to an increase in sales revenue of spirits, non-alcoholic beverages, and the food business. Although there was a slight decrease in sales revenue of the beer business, the net profit was THB 30,727 million, a decrease of 10.9% year-on-year. This was due to a decrease of net profit, mainly from beer business, food business, and associated companies. Although there was an increase of net profit from spirits and non-alcoholic beverages business. The board of directors has proposed to issue a dividend of THB 15,075 million, or THB 0.6 per share, maintaining the same level as last year. The payout ratio for 2023 dividend is 55%. Please note that the interim dividend was paid in June this year at THB 0.15 per share, and the final dividend will be THB 0.45 per share. In 2023, the spirits business generated a 3.1% rise in sales revenue to THB 119,799 million, even as total sales volume decreased by 2.1% compared to last year. In spite of challenges such as higher costs of packaging and financing, the business continued to deliver robust performance with a record high in net profit, reaching THB 22,446 million, an increase of 2.5% year-on-year. The top and bottom line improvements were mainly driven by price adjustments, as well as changes in the product mix in Thailand, with higher consumption of the brown spirits. The beer business recorded sales revenue amounting to THB 120,829 million in 2023, a decrease of 1.4% compared to previous year. This was mainly due to a 6.6% year-on-year decline in the sales volume, an increase in brand A&P investment, marketing activities, and competitive pressures, coupled with higher cost of key raw materials and packaging, contributed to the net profit declining 34.3% to THB 4,559 million. The non-alcoholic beverage business recorded a 12.4% rise in sales revenue to THB 19,602 million in 2023. The sales revenue was lifted by a 7.1% increase in total sales volume. Continued initiative to improve production efficiency have effectively mitigated the impact of escalating packaging costs, resulted in a net profit increase of 15.2% year-on-year to THB 675 million. For the food business, it registered a 16% increase in sales revenue to THB 19,070 million, in line with the rise in traffic at the restaurants. Taking into account the group's ongoing efforts to improve brand visibility and accessibility, along with pre-opening expenses incurred in conjunction with the opening of the new stores, cost push factor, as well as increased operational and administrative costs to support the sales growth, the net profit of food business declined 82.7% to THB 65 million. This is a summary of our full year 2023 financial results. Now, we will open the call to any questions on our results. Operator, please help open the line for Q&A. Thank you. We will now begin the question and answer session. Participants with questions to pose, please press star one one on your telephone keypad, and you will be placed in the queue. To cancel the queue, please press star one one again. One moment, please, for the first question. The first question comes from the line of Divya Kothiyal from Morgan Stanley. Please go ahead. Thank you and good evening. I had three questions. The first one was on the spirits business. You mentioned that the product mix between brown and white has changed a bit over the course of the last couple of quarters, with the brown spirits becoming a bigger part. I wanted to know if this has gone back to the pre-COVID levels, or is there still some room for brown spirits to grow and hence margins to improve? My second question is on the domestic beer business. Could you help us understand why the beer business saw a 2% decline in volumes this year, despite the resumption of on-trade and the general reopening latter? Could you also comment on Carabao's launch and how that's positioned versus Chang, and how we are responding? How does that affect the outlook for the beer business domestically for the next year? Lastly, can you just update us of any proposals being reviewed by the new government on changes in excise tax in Thailand? Thank you. Hi, Divya, this is Bob from Spirit Group. Well, at the brown spirit level, the volumes sold in the past year still lower than pre-COVID. We're moving back to that direction, but there are still some more room to get back to it. But that's just to confirm your thinking that there's more potential growth for brown spirit consumption as well. On beer, I think we can separate between Vietnam and Thailand. Why the market, why, why there is down? Question two. Okay. Hi, this is Songwit from Beer Thailand. I think your questions two things, right? The first one is about the situation for the beer volume in Thailand, and the second one is the detail for the Carabao launch. For Thailand... But for Thailand, actually, I think right now, we were talking about the macro economy. The GDP is lower than expected, that 2.7, compared to 3.5 as original forecast. I think that for this year, the overall of the beer market... Okay. For this year, for the beer market, it's growing in terms of the value because both of the players, meaning that the competitor and us, we increase the price, but while the volume may a little bit stable. And then, for the questions about the Carabao Beer, they just launched on the ninth of November, and then they have two brands. The first brand is Carabao Beer, and second brand is Tawandang. From the pricing perspective that you just asked, that their pricing is higher than Chang Classic and also higher than the other player, Leo. Roughly about THB 1 per bottle. And then, right now, we're not sure. We don't know right now. It is early to talk about the impact. But for our action, I think we already, I mean, pushed the stock into the route to market and to protect our shelf space, and also make sure that our trade partner they also drive our distribution for our products in the shelf. And from the feedback so far, I think still, how to say? A smaller group of the people that give the positive feedback for the taste of both Carabao Beer and Tawandang. However, I think it's still early to tell. Okay. Divya, Ueychai here. The third question about excise tax. I have always said that we cannot, we do not know when it's gonna happen or anything. But if you ask me, probably second or third quarter next year, we will know. After the government has really straighten up their budget right now. It looks like, it looks like they if they need money, then it's highly likely they will increase the tax here, okay? But we don't know. At the moment, we haven't heard anything yet. But just to assure you that we've been through price, I mean, excise tax increase for more than 15 times already, and we always come out better than in terms of P&L, in terms of profit. Bottom line, we haven't heard anything. Likely, maybe next year, if the government need money, they likely need money, it could be, 'cause spirits and cigarettes are on the priority list, on the top of the list. But lastly, we be able to manage it. Okay. Thank you. Okay, thank you very much. One moment, please, for the next question. The next question comes from the line of, Selviana Aripin from HSBC. Please go ahead. Sure. Thank you very much for the opportunity. I have two questions. The first one is around expectation for volume moderation. I guess, you know, the volume declined this time around. It's understandable that it's due to pricing increases, but when do you expect volume to normalize, and I guess for the price increase to be fully digested? So that's the first question. The second question is around, can you—can management actually speaks about speak about the expectation around input, particularly molasses and malted barley, over the next six and twelve months? Thank you. For expectation, volume on beer, spirit or, or NAB? Please say it again? Beer and spirit. Okay, beer and spirit. First question is our expectation on beer and spirit, whether the situation normalized. And then the second question is on the- Uh. raw materials, molasses for spirit, and then beer is? Yes. Directionally, how should we think about, I guess, input costs going into the next successive quarter? Right. Right. Okay. On both the spirit questions, Khun Prapakon will respond on both, both questions and then come to beer. Okay? Yeah. Okay. So the questions about the volumes, spirit, actually, a majority of volumes reported made in Thailand. We do have a volume growth in Myanmar. We do have volume growth in other countries, but those still representing, in combination, less, probably less than 10% of the total volumes. So if you look at the volumes in Thailand itself, we actually experienced a slight decline in volumes, and that's have to do with the larger base of sale loading from pricing base of white spirit in the previous year. So when you compare with this year, the white spirit sale reporting a slight decline, decline from the previous year before, but the brown spirit are reporting a higher volumes. That's what explained earlier. So I think, the price increase are not resulting in overloading in this FY 2023. So that's the answer. So in terms of, the molasses input costs, at the moment, the crop, the new crops still not harvested, but we're expecting that crop to be, short, much shorter in supply than the previous year. So we're expecting the molasses cost should rise from the previous year. Okay. That's where I am. For beer, we will start with Thailand. Thank you. Sorry, can I stop there and actually ask about expectation for, I guess, a volume for spirits? Should we expect positive sort of volume growth going ahead for spirits in Thailand? So, Viana, in terms of our policy, we don't give the forward guidance in terms of the forecast. Yeah. Sorry about that. Sure. Got it. Thanks. Sure, no problem. Can we go on to the beer? Sorry. Yeah, I think if you ask us, definitely on budget, we expect the volume to grow, but we cannot tell you exactly what it is, because we aim to grow our market and our sales. Okay, Thailand beer. Hi, this is Songwit again. I think for the malt, malt price for the beer business in Thailand, this, for today's price, the price is for the malt is about EUR 740 per ton. And I think, for us, actually, we already secure the malt price for the whole year. And for the number, I think roughly about in the 500-something. So that for the whole year of the malt price. And then second one, I think just for the packaging, mainly is the aluminum can. And I think from our tracking, right now, we can secure the price as well, and for the price of the packaging, I think slightly lower than last year. Vietnam? For beer... Sorry, for beer, how, like, typically, how long does it take for price increases to get digested? I guess that's my first off question. For beer in Thailand, last year, fiscal year, we increased price 2 times. First time at the first quarter of fiscal year, mainly, I mean, for the Chang large bottle at the end of November. And then, second time at the second quarter, roughly around end of February. So I'm not sure, your question is when we're gonna increase the price for the next round or? Uh- On our price. Okay, on the price increase- No, how Hold on, hold on. How long do you think it will get digested? I think we did increase the price last year to cover all the costs, push all the cost increase. So we don't expect the cost to increase big time, like this year. So the next price increase, if it is happen, it only happen if the excise tax increase, because our policy is to retain profitability in term of percentage to sales. So if the excise tax doesn't move, I don't think we will move our price, right? Because it's only that if the excise tax increase, then the company will consider. Because if the excise tax increase, everybody increase. So the competitive playground is the same. Okay? So in term of... He didn't respond on the volume expectation. I, of course, this year, this year, because- ... We hope the tourism will come back more. At this moment, the Chinese tourists hasn't come in as expected. Next year, everything should—I mean, this year, we should expect to have more, more, more tourists, because this year, the whole year is only 26 million. And then next year, probably a lot, quite a bit more, especially the government has a policy of free visa for India, for China. So we expect, we expect to have a better consumption situation for Thailand, okay? That's all I can tell you. But please, you have to understand that- Thank you. When we do the budget, we always look up to the growing volumes, right? We cannot say we are happy with the volume to go down, all right? Our bonus depends on that. Thank you. Thank you very much. That was clear. One moment, please, for the next question. Want to hear about Vietnam? The next question comes from the line of Larrison from UBS. Please go ahead. Hi, yeah, thanks for letting me ask my question. So, most of my questions were answered previously, so but now I have two, just two short questions. So the first question is, could you share a little bit about the market share for the beer segment in both Vietnam and Thailand, especially Thailand? And my second question would be, so just something about the financial. So could you share why the share of profits from associate and joint venture fell in this year as compared to the previous year? So it was like THB 2 billion, but drop, if I'm not wrong. Yeah. Yeah, that's all from me. Thank you. Okay, now Vietnam is asked. Please start with Vietnam. Hi, Larrison, this is Lester here. Talking about market share in Vietnam, I think for us. We're talking about last FY, right? We're not, we don't talk about Q1. Sorry. Yeah, last month FY or the last financial quarter. Yeah. Yeah. So, you know, our share is picking up. At the end of the financial year last year, we had crossed over to become the market leader in Vietnam. I think it's, again, no forward-looking statements here, but it's looking positive. So, in a declining market, obviously, we are looking at trying to grow market share and profitability. I think at the SABECO call last week, I mentioned the same things, that... Talking about Selviana's question earlier about volume normalization after a price increase. You know, it's down to quite a few different factors. In Vietnam, there were two price increases by all the producers in 2021. The market was able to absorb it quite quickly. Then there were another two price increases in 2022, followed by another price increase in 2023. But after 2021, and you see the market, the overall macro situation coming, starting to come down, the market is taking a little longer to digest these, these price increases. So really, it's, you know, dependent on quite a few factors. So on that part, at the moment now, the, the current set of increases still taking a while to digest, simply because the market is, is, on a downtrend, and the macroeconomic picture is not looking so healthy. So on that part, you know, given this sort of the conditions, we are looking to grow market share as opposed to volume, and we're looking to grow profitability as well, moving forward. So, long answer to that is that market share is looking good, and we will continue to focus on growing market share in the months ahead. Okay. Hi, this is Songwit from Thailand. For the market share of our beer business in Thailand, in the range, I mean, a large, I mean, roughly about 30% market share. Last year, we made a Chang Classic, I mean, to hit almost the number one. We hit at the narrowest market share gap with the new number one ever. And then the second point that I want to add is, Chang Cold Brew. We can put Chang Cold Brew now to be the top four beer brand in Thailand. So that's it, yeah. The second question, Sithichai will respond. Sithichai, you can, for our share profit, we just have two major parts. First one is, F&N, Fraser and Neave. Second one is the Fraser's Property Limited, FPL. F&N, they are higher profit compared to last year. You can see that they had—they get a higher, dividend also. This year, get THB 0.055, compared to last year, THB 0.05. FPL, FPL, investment property, they use fair value, but FPL, we use cost. So their core profit a little lower, not much, but the one that make up lower is the realized gain. Last year, they have more realized gain compared to this year, but even we share the profit, realized gain lower than last year, but in terms of dividend, they pay higher. They used to pay, three point five cent. This year, they pay THB 0.04-THB 0.045. Yeah. ... We seem to have lost this line. Shall we move on to the next question? Nantika, can go ahead with the next question in the line. Thank you. The next question comes from the line from Joan Tan, from Goldman Sachs. Please go ahead. Hi, good evening. Thanks for the briefing. I think earlier, Lester, you mentioned Vietnam beer focus is market share and profitability, right? Can management also talk a bit more about key focus for spirits in Thailand beer? Hi. I think for Thailand beer, for sure, we focus on three things. We call internally as MRP. Mainly number one, we focus our market share, meaning we want to be brand number one and also Thai beer number one. Second one, we focus on our top line, or we call revenue, mainly in both of the volume, in liters, and also in the revenue in THB. And the last one, we focus on the bottom line, for sure, the profit, both of the profit in terms of THB and also percent profit margin. Yeah, so that all what that all the three things that we focus. On spirit market share, I think on brown spirit, Nielsen report that we have 95% market share. I think we cannot go more than that, otherwise... And then in white spirit, we don't have the Nielsen report, but from the reliable source of excise payment, we are in the region of 88%-89%. Hi, so, do you know the focus? Okay. Sorry. Yeah. Yeah, you get. Yeah. Thank you. So the focus on spirits would then be profitability. Is that fair? Yeah. This is Prapakon. Yes, I think from the Spirit Group perspective, we take the business on the two pillars. One is providing growth in terms of product sales, but at the same time, we are cautious to focus on our managed profitability. So with the imported input cost pressures, we will be looking at higher efficiency in terms of other expenses that we have, so that we can manage our profit comfortably. So we're looking at profit growth as another pillar that we focus on. Got it. Thank you. Can you also talk a bit more about SG&A, especially for Thailand and Vietnam beer? For 2024. Yeah. Okay. Hi, this is Lester here. Let me talk about SG&A for Vietnam. First, I don't know if you attended the call last week for Sabeco. Obviously, one of the things we're looking at is A&P spending. And so we are, we're importing a model that we, that I have experience with when I was looking after Beer Thailand. We have internal sources that help us to build a model to, to look at the ROI for each of the A&P activities that we run in the market. So what we do is we look for those activities that are the most, that, that brings in the best volumes at the lowest cost. And from there, we, we reorder the prioritization of each of the activities in the market, and after that, then we, we look to, to improve the spend efficiency. So we experienced quite good success with that model in Thailand. I'm trying to introduce it... I'm not, not that I'm trying, I will be introducing it in Vietnam, in the year ahead, so that we can improve our, the, the SG&A spending and the, the returns per liter, of beer that we sell. So that's what we're doing to improve not just the total cost, but actually the efficiency of the spend as well. Yeah, just to add, maybe for Thailand, I think, Lester, we shared with you the approach that we take, but I just want to make the point that, despite the, well, despite the lower consumer demand that we are facing, it's become extremely competitive, especially in the segment that we are most dominant in the mainstream. So spending A&P is a must. I mean, we need to spend to defend our leadership position. So that is the reason why we focus on A&P efficiency spend. I don't want to say how much we spend, because it depends on the situation. It's very fluid at the moment, but clearly, our gains in market share in recent months show that this is working, so we'll continue to do that. Thank you. Thank you. Can you also update what's the situation, latest situation in Myanmar? Let's see. Well, I think the situation in Myanmar is, when you see the news, the news always tend to talk about the incident that that sound dangerous, but these are not really in the main consumption area of the Yangon or Mandalay areas, where majority of the consumer are still living their life normally. I think lots of these news reports are up in the north, those are probably from the consumption perspective, representing maybe 5% to less than 10% of the actual alcohol consumptions of the country... and I think so far from the spirit perspective, Grand Royal Whisky have performed very well in the past year and still continue to perform exceedingly well in the first month of October that we have seen. Okay. Thank you. That's all from me. One moment, please, for the next question. The next question comes from the line of Permada Darmono from UBS. Please go ahead. Hi, good evening. Thanks for the opportunity. My first question is, you've done a few acquisitions recently in the spirit side, Larsen, and also, Cardrona in New Zealand. As a, you know, percentage of the overall business, this appears pretty small, and also in September, you filed basically a company in Hong Kong, Spirits Co. So can you explain to us what's the thinking there? Okay. On the two acquisitions we made in September, the one is Larsen Cognac, the other one is Cardrona Distillery in New Zealand. The two actually play a different, well, play in the same premium portfolios, but they did have a different life cycle in the portfolios. The Larsen Cognac, which is a cognac business, it's an ongoing business, and the brand has been around for close to 100 years. So those brands have been around. And so it is a cognac business that we would like to add the premium portfolios into our international sale network. And currently, or even before the acquisitions, our subsidiary in China, called Asia Euro International Beverage, so we call it AEIB, operate in China and Hong Kong, are already the distributor of Larsen Cognac in China and Hong Kong. So by acquiring Larsen Cognac allows us to to representing our own products in China. So that's why we made these acquisitions. So it's allow us to to have a better control of what we distribute, including Scotch whisky from our Inver House Distillers group up in Scotland and the Larsen Cognac from France. So that's from the cognac business. From the Cardrona Distillery, this one is a very young distillery. The business has been around less than 10 years, so this one is a very small distillery, but at the very premium end of the market. The focus is to continue to build on the stock and expansions and focus on premium marketing of this brand. So I think as it stands, when we acquired the business, the distillery doesn't have a lot of aged stock available. So we will be putting basically increase the utilization to a maximum capacity and start to build stock, and that payout will probably be looking at a five-seven year onward. So that's a very long-term investment for us. So that's the two acquisitions. As for the Spirit Co. registration- I mean- It's a registration of name, so similar to Beer Co, Spirit Co. So perhaps in the future, if we would need to do certain group restructuring to management, restructurings of the business, we would be able to use that name. So that's just a placeholder on the name. Yeah. The Source Gin of Cardrona is really, really nice, of course. Is the idea really to bulk up the international spirits business, to primarily cater and expand in the Chinese market? Is that the thinking? Well, the Cardrona Distillery, that, the New Zealand whiskeys are meant for the European and U.S. market. So on the other way around, we do also have the Reid Vodka, which is a premium vodka coming from New Zealand. So these two acquisitions, it's about building up a better portfolios of premium spirits that we sell internationally. In addition to that, because you're touching on the acquisitions, we do have product portfolios that going to be coming out from Thailand, that will be going into the premium segment as well. We have launched recently made that available. It's only on duty free in Thailand, and we will be expanding our portfolios, which is a premium and about Ruang Khao white spirit. We made it out in the aged rum type of products. We also have Phraya Aged Rum, and in the very near future, we'll be launching additional SKU with the age statement on those aged rum. In probably the next six months, we will be taking to the market our single malt whiskey from Thailand as well. So that's something that is in the pipeline. So we are adding products, premium product from Thailand into our international sale network portfolio as well. Thank you, Prapakon. My next question is on rising interest rate. I think if I recall in the past, ThaiBev has said one of the rationale to list BeerCo ASAP is because of, you know, rising rates. Now, rates have risen. What's your thinking or strategies in terms of refinancing some of your debt? And any comments on average cost of debt? Yeah. In terms of the debt portfolio, let me explain. But there are certain advantages being a Thai company. The interest rate environment in Thailand is considered relatively lower than the other markets around the world. The floating interest rate before the margin today in the bank markets stands at 2.5% floating, and we take that float to fix out into a fixed rate for 5-year, four- to five year. The fixed premium is only about 10 basis points, so you can actually get from float to fixed, from 2.5% to 2.6%-2.7%. So the yield curve is relatively flat. Our capabilities in terms of fundraising, because we are a Thai company and most of our debt on the balance sheet actually sit at ThaiBev Public Company, Thai Beverage Public Company, the Thai company, the listed co itself, and therefore we can have a very good investment-grade ratings in Thailand that we can raise fund from the Thai Bond debenture market. So to answer to that, yes, the interest rate, the interest costs have risen in the previous year, but actually less than 0.5%, because we do have a large part of the fixed interest rate in our portfolio. As debt become due, we do refinance into additional fixed rates, which you can see from our disclosure. In the past year, we do have a series of baht, Thai baht debentures continue to come out. Okay. So hopefully that explained to you and confident you that we actually do have good control of interest rate, and the interest rate environment in Thailand are much lower than, say, the international in other international market. Yes, that's great and super helpful. Finally, with Carabao, you know, producing in Thailand, and I do understand that they produce out of Tawandang 1999, which is privately held. Is the Thai capital market or securities market potentially becoming more tolerant of a possible listing of a alcoholic beverage company in Thailand, or in your view, that has not changed? Well, we cannot. This is Ueychai. We cannot tell you exactly what will happen, but I think the people who protest alcoholic beverage to go into the securities market is still around. I think I can't tell whether what they would do the same, but personally, I think they will not allow, okay? Because they don't particularly not allow only Chang, but any alcoholic beverage things, because they claim that this is a Buddhist country and all. So I'm quite sure that this group will still anti for beverage company to going in, unless they do backdoor, you know, backdoor listing or things, which is, I don't know. Not allowed. Not allowed. Okay? Thank you, Ueychai. And one more question, if I may, to Lester. You commented last week that, and I know it's been only one week, that consumption will remain probably weak for more than six months. But anything that you might have seen to change that outlook or not really? Yeah, no, it's nothing much has changed in one week. Again, beer is a pretty standard product. It's not like a bubble tea where, you know, you get trends, you get sudden spikes and then quite big dips. Beer is fairly standard, so not much would have changed in one week. I think generally the consensus is still six months, and I've seen one report saying not until Q1 2025. I know that's a little bit extreme, but I think all of us have our fingers crossed towards H2 next year. Thank you so much. Those are all my questions, and of course, all the best for the first quarter of fiscal year 2024. Thank you. The next question comes from the line of Thitithep Nophaket. One moment, from Thitithep Nophaket Hello, hi. From Kiatnakin Company- Hi, can you hear me? Management, please go ahead. ... Can you hear me? Yes, we can. Hello? Uh, hello. Yes, I have two questions. Number one, if you look at your SG&A as a percentage of sales at a consolidated level, it was roughly about 17% in 2019, and then it came down to around 15% during COVID. And then as of for the fiscal year 2023, it went back to 17%, you know, which means it went back to the pre-COVID level. Should we expect the ratio to stay at this level, around 17%, or do you think it may go up further because now we have a new entrant in the beer market? That's number one question. Number two, Carabao seems to be very confident that they can grab 10% market share in beer within this year. Now, I know that you said it's too early to estimate any impact, but do you think that their target is realistic or it's on the optimistic side? Thank you. Only two questions. Thitithep, I respond on Carabao then. Their total capacity is about 200 million liters, and then the total market in Thailand is about 2,000 million liters. So if they have to achieve 10%, they have to do 100% capacities every month, which I don't think it will be possible. For me, personally, maximum, if they get 5% this year, I think they are, they are great already. Okay? So we, we don't think 10% is definitely possible, because we know when we run, we run the, the breweries, we cannot run 100%, and then the beer business, we cannot produce, I mean, the stock ahead of time because we will have to worry about the freshness of the beer. It's not like spirit. Spirit is possible because you can run over the capabilities, because spirit is not rotten, but beer is. So I don't think they will get 10%, okay? Maximum they will get is 5%. But let's see, because they use a lot of PR to make public think that things really, really going well with them. But the actual fact is not that. But okay, I will stop there because... And then on the A&P, SG&A, can you talk? Thank you very much. Oh. From my observation, it, I don't... I think 10% is optimistic, but that, that's what they are claiming. They claim that they are running at a full capacity. I think beer, we've been in this business for many years. We cannot run 100% every month. Okay? Right. Okay, that's confirmed. That, that's very helpful. Thank you very much. We'll respond on the SG&A. Yeah. Khun Thitithep, Kosit here. I think, for the SG&A overall of the group this year, when we look at the common side, it looks a bit little bit higher than last year, because some of the thing that it we flagging up in terms of the external control, like fuel on the logistic cost, some of the some of spending in terms of the how we ramp up the sales transaction in terms of the market, probably will coming up when we compare with the last year. So that's why it will be slightly higher than last year. While if we're breaking in the component of the administrative in our group itself, in the details, actually, we have been growing up in terms of the administrative. Means that we still put in the efficiency control on the overhead cost in the company. We doesn't expect anything to be significant in growing in terms of the year-on-year. Right. So, we should not expect the percentage to go up further because of the new entrants? Yeah, I think it should remain relatively the same, นะ Khun Thitithep. Right. Okay, sure. That's very clear. Thank you very much. That's all the questions I have. Thank you, Thitithep. The next question comes from the line of Andy Sim from DBS Vickers Securities. Please go ahead. Hello. Hi, can you hear me? Hello? We can hear you. Hi. Hi. Yeah, we, we can hear you. Oh, okay. Okay, thanks. Thank you for the opportunity. My first question is related to SG&A, but, also, but more targeted at spirits itself. Notice that actually spirits, in the presentation, the spirits SG&A is now, gone up, as percentage of sales. Can we understand the reason for that? Is it due to, the mix of brown spirits, which traditionally has, higher spending, or because of, the slower, expected reopening, timing issues, or any, competition, any reason for it in terms of the higher, brand investment and marketing expenses for spirits itself? That's my first question. And second question, actually, if I may, is, with respect to, the earlier question on Tawandang, market share. Just wanted to clarify, have you seen any market players take 5% market share within the year? I'm not sure whether I've seen that globally, right. I think the third question is actually in terms of the inventory. Inventory days for beer noted that it actually had gone up a bit to 14 days from 9 days last year. So just want to understand what's driving this, and what would be the comfortable figure for the group as a whole itself? Yeah, that's my question. On the split side, I think the SG&As have gone up slightly. I think they have to do with the market- Mm-hmm. -to be reopening. The beer split, as we've seen that the south beer split, growth have, gone up, so we actually increased some money on the beer split. But we would expect this percentage to be quite maintained, going forward. Okay. So we wouldn't expect it to increase significantly a lot going forward? No, I don't think so. Would there be any timing issue for that also? Because I think second half was slightly higher, compared to first half. Yeah. I think, I think the second half, so it's slightly lower. I think the spending is quite maintained throughout the period. Okay. That's why you see the percentage might be slightly higher. Yeah. Right. Okay. Thank you. One moment, please, for the next question. Sorry, the other- Oh, I, I- Apologies. Please go ahead. Yes. Please go ahead. Second question, you talk about the inventory of the beer as a total, right? Yeah. That's the... Yeah, that's the third question in terms of inventory. Yeah, the second question is actually in terms of, let me just follow up with respect to, the take about market players taking 5% within a year. I'm not sure whether, I've probably never seen any market that a player within the first year take 5% market share. I'm not sure. Maybe I, I could be mistaken. Yes. Hello? Yeah. Hi, hi, Andy. Edmund here, yeah. Yeah. Yeah. I think based on experience, I mean, you're right. To have a 5% growth in one year is not very common, unless your proposition is very compelling and you have a very strong differentiator. I think, just to share, I think what has happened is actually Chang Classic did that, because we transformed from brown to green bottle. That was very significant, very strong and compelling proposition and became quite a significant share. But looking at what we have with Carabao, I mean, what they're offering is nothing exceptional. It is very much an offering that is riding on the Carabao brand, as well as Tawandang, but it is nothing that is going to... It's not groundbreaking, and it's not transformational. So having a 5% share growth in one year, I think, we, we think would be probably quite optimistic. So I think a more realistic number could be, I don't know, between a range of perhaps... I don't know. It's hard to tell, yeah, but, Yeah. I think that's where we are. Andy, that's what I said earlier, that, for... Because they claim that they're gonna do 10%. Yeah. What I said is, if they cut 5%, they are great already. They'll be a superman. Okay, Edmund. Okay? I don't think, I don't think I will see that, but I cannot, we cannot, we cannot say anything more than that. I think maximum 2%-3%, they are good already. Okay. Got it. So, Andy, on your last question regarding the inventory levels, this is a consolidated number. So it's the combination of factors. One is, of course, the slow economy in both Thailand and Vietnam. Also, because of the shrinking market in both countries, the shrinking beer market production going down. And the third one is in Vietnam, we start to prepare our stocks for Tet, which, you know, is in February. I know it starts a little bit early, but that also contributed this increase in the ratio. But it's under control. Okay? So it will come down. Okay. So, I mean, going forward, we should see actually normalize back to, like, maybe just under 10 days. Yep, it will come down moving forward. Okay. Thank you. All right. Andy, we will drink more to get rid of that four days. Okay. I'll do that too, okay. Thank you. Thank you. The next question comes from the line of Ivan Yong from Asia Resource Corporation. Please go ahead. Hi, can you hear me? Yes, we can hear you. Hi, thank you. I just have two questions. It's regarding your CapEx spending. So I understand from the questions asked earlier was on the acquisition of Larsen's Cognac and the Cardrona Distillery. So, sorry, I didn't get the person to reply to that question, but he mentioned that the payout for Cardrona Distillery can only happen after a period of five to seven years. So does that mean that we can expect a higher CapEx spending? Do you have a figure in mind? And, also, would you be able to disclose what's the acquisition price of the Cardrona Distillery? So that's my first question. The second question concerns the food business of ThaiBev. So, I understand from your investor day earlier this year, that you intend to grow the number of restaurants incrementally over a period of time, and the focus is on both KFC and Oishi. Maybe you could share with us or, or give us an idea what's the average startup cost of, you know, starting up a KFC restaurant as opposed to starting a restaurant or, or Oishi-branded restaurant? Are there significant difference in the startup cost? Thank you. On the Cardrona Distillery, what I refer to is that it's a very long-term investment, because in aged whiskey, the product need to be kept aged and probably come to market around seven years onward. So as we increase stock, and those stock that we invest today will only come to market, say, seven years out from now. So in term of our projected cash flow, positive for this project will probably take another three years to four years outward. The acquisition cost of the Cardrona Distillery has been disclosed on the filings, I think, just yesterday as well. The amount is very relatively small for our business group. Spirit business group is about twenty, about twenty-eight New Zealand dollars. Twenty-eight million New Zealand dollars. Yeah. Sorry, just to follow up on the reply that you need to invest in aged stock, and it's a negative cash flow. So does that mean that you only grow your aged stock organically? You do not purchase matured casks from the market to rebrand into Cardrona or, or- No. You know, Cardrona brand of product. This is a New Zealand distillery, where distill, age, and from New Zealand. So it's only being distilled from our distillery. So in terms of a working capital investment in the next 3-5 years, it will be less than NZD 20 million. Yeah. Hi, this is Nongnuch. On the food, the questions on the investment of the outlet. Basically, the Oishi one is a bit lower than KFC. However, it depends more on the model, okay? If it's like drive-through, it's almost double of the normal outlets that we invest. So, and this year, because after COVID, the situation is coming back, so we have opened lots more of the store than earlier, a few years back, okay? And also doing some of the renovation of the store to upgrade the store to ensure that customer coming back. Okay? Thank you. Yeah. Sorry, yeah. So, Nongnuch, just to follow up on the question also, are you all contractually obliged to open a fixed number of KFC stores? As I understand that you are a franchisor of the KFC brand. Is there like a minimum number of stores which you are required to open and commit to a minimum amount of CapEx? Yeah, we do. Yeah, we do. We have the minimum that we need to open, yeah, per year. Okay. Could you give us some guidance on that? You know, like, what's the... Is that a fixed number or is that a percentage? Sorry, Alvin, for this one, it's confidential information that we do not disclose. Sorry. Oh, yeah. Yeah. Oh, okay. Okay, yeah, no worries. Yeah. Thank you for that. One moment, please, for the next question. The next question comes from the line of Llelleythan Tan from UOB. Please go ahead. Hi, hi. Sorry, just now I got cut off, so that's why I didn't respond. But I just have one last question. So I understand from previous questions earlier that ASPs for next year won't likely increase unless there's excise taxes in the second or third quarter. But from my—from what I recall from the last briefing, the brown spirits, there was expectations that the brown spirit had room for price increases. So my question is basically, has expectations changed or brown spirits is also won't... There won't be any more ASP increases for the brown spirits as well? Yeah, this is just my last question. Thanks. Hello. Hi, hi, Lester Tan, you are talking about price increase in the brown spirit? Yeah, yeah. Uh, you, you- Yeah, so like- Yeah. For the brown spirits, yeah. You mean, going forward, are there any new price increase for the brown spirit or not? Something like that, right? Yeah. So, because I... From the last meeting, I remember that it was mentioned that there was room for price increases. There was expectations for that. But then, from what I heard in the call just now is that there probably won't be any more ASP- Yeah. -increase unless there's an extra excise tax increase. Yeah. Okay. The price increase is a gradual process that we manage in the market, where we see the potential gap and in term of what we can push through price with the consumer. So last year in Thailand, we're talking about Thailand. Last year in Thailand, we have a price increase much earlier in the year, with some from the SKU, with larger bottle. This year, already started in November. We have started to do push for a price increase in a smaller SKU, that still have some more room for a price increase. And these SKU have not had any price increase for the past five years, since right before COVID. And we were planning to do something, and then COVID came, so we haven't really adjusted those prices. So we are now pushing for those price gradually. In other market- Mm. like Myanmar, price increase is a way of life, because with the high inflation, price continue to rise and then input cost, so we adjust upward. In the other international market, we do have- ... opportunity for price increase, so we continue to push forward. Because as, in the other international market, the other international players also have been pushing for price increase due to higher input costs as well. Okay. Yep, thank you. Very clear. Thank you. One moment, please, for the next question. The next question comes from the line of Permada Darmono from UBS. Please go ahead. Thank you. Just one follow-up question. There was a comment earlier, I think by Lester, that the sales to or the trade channels leading into Tet has begun, and in the past, Saigon Beer has commented that it's, you know, competitor habitually trade load during Tet. Are you seeing a similar behavior, especially after they've suffered quite a bit during that earlier this year? Hi, Permada, Lester here. Yeah, we, we see in the market, it started in October, that a lot of players, not just within the beer industry, but actually across the market, sorry, across all product groups, starting to push out Tet stocks already. Maybe we... Yeah. So, so the stocks are starting to go up. It's not as heavy as last year. In the beer market, in the beer market, we see a little bit of a hangover from the middle part of the year, where, where promo stocks from the middle of the year continue to be in market. So, so we see that the Tet push out has been a little bit slower than normal. In fact, the head of our IR, Gie, was out in the market, and she gave me some feedback on some of the stocks that she saw that actually, generally, all of us start to see that this year's Tet push out hasn't been as heavy as last year. But again, it's early days. Tet is actually in February next year, so it's a little bit early. So we expect that in the next few weeks, next few months, it will start to ramp up. But I think it's a little, we expect it to be a little bit muted this year, but, you know, still, it is the highest selling season of the year. All of us will be fighting really hard for market share during this period. Thanks very much, Lester, for the color. Much appreciated. Thank you. Now coming to your questions. If you would like to ask a question, please press star one one on your telephone keypad. One moment, please, for the next question. The next question comes from the line of Sheng Fang Ji from DBS Vickers Securities. Please go ahead. Yeah, hi. Can you hear me? We can hear you. Okay. So just one question. I just wanted to get a bit more color in terms of CapEx. So CapEx seems to have spiked up for 2023. So just wanted to get a bit of understanding of what's causing that spike and what's the kind of outlook in terms of CapEx spend in the coming years? Thanks. Hello, hi, Khun Chai here. Same thing. I think actually when we look at the CapEx for investing, where if you look at the line that you said is quite lacking, actually, if you see on the line that the purchase of the PPE, actually we're increasing, but just a matter of the classification in terms of the current investment in Vietnam, we, you know, change from the current investment to the cash. That's why it's, it shows some positive in the investing activity, so you see that is some of the lower. But you look at the PPE sales, actually, we increasing. Okay, so what does that mean? So that means that it's just a reallocation. Is that what you're trying to say? Yeah. Based on the accounting standard, actually, when the short-term investment classification, like a short-term deposit, when you change from the status from current investment to the cash, this one will present in the cash flow as a positive cash flow in investing. That, that is only the classification. Yeah. So, actually, I was talking more about the net spend on PPE. Oh. It seems a bit higher, about THB 4.5 billion- Yes. - for FY 2023. Yes. Yes, that, that one- 3.2, right, last year. Yeah. That's why I mentioned it, THB 2.46 million, right, increasing from last year. Mostly that we expand, that we increase- Yeah. On the investing, whether it's on the factory upgrading, some of the capacity expansion also, we're lining up in this year as well, compared with last year. Yes. Okay, but I guess, going forward, I would think that you would reduce the CapEx because, I mean, the volumes are not really coming in. We haven't have any plan to reduce the CapEx right now, Khun, Sheng. This is Chai, CFO. Okay. Invest in CapEx. It's a good market. If you need to review the CapEx, how can you get more profit? How can I get the more sale? It's a, it's a future, it's expansion, it's a goal. You keep review, how can you have a good cost sale in here? How can you have the higher profit? Cannot. Okay, yeah, yeah. Understood. Yeah, yeah. Thank you. Thank you for your clarity. One moment, please, for the next question. ... The next one comes from the line of Joan Tan from Goldman Sachs. Please go ahead. Hi, I just have one question on effective tax. I think the tax rate increased year-on-year. I just want to check if there's any one-off and what would be a fair assumption going forward? Hi, it's Sean Tan. I think actually the effective tax rate this year is increased a little bit in term of the some of the profit in the Thailand base. We also increasing and some of the tax incentive privilege some of our subsidiary also expired this year. That's why we have some of the slightly increasing in term of the effective tax rate this year. Right. Would this be a good base, going forward? I think it could be some of the baseline, but we also have the new incentive coming in for the new project. For example, like, some of energy production, we also get some of its new incentive. Probably, we will try to balance in term of the, how we manage in term of the effective tax rate in the future. Okay. And sorry, I didn't catch what was mentioned earlier on malt. It was 740 EUR per ton, and then now the new price is 500 EUR per ton, so it's lower in 2024 versus 2023. Just want to check if I caught that correctly. You got it. You got it correctly. Okay. Thank you. That's all from me. Once again, there are currently no questions. If you would like to ask a question, please press star one one on your telephone keypad. As there are no further questions, we will now begin the closing comments. Please go ahead, Ms. Namfon Aungsutornrungsi. Okay, thank you for joining the ThaiBev conference call tonight. If you have any more questions, please feel free to contact IR department at ir@thaibev.com. Thank you, and have a good night.