Charoen Pokphand Foods

(CP Foods)
Presented by
Ahmed Kamal, Usman Ali,
Rituraj Bhuyan

Company Overview
Risk Factors
Financial Analysis
Business Strategies & Expansion
Corporate Social Responsibility
Conclusion

Companys Overview
CP Foods is a company of the Charoen
Pokphand Group (CP Group).
Founded in 1978 by Dhanin Chearavanont.
It is an agro-industrial and food
conglomerate in Thailand.
It is a public company traded in the Stock
Exchange of Thailand.
Estimated Revenues of 426,039 million Baht
Estimated Income of 10,562 million Baht

CPF Operations

Core Business
1. Live Stock : CPF's livestock business includes
broilers, layers, swines & ducks. Products are
divided into categories.
2. Aquaculture: CPF's business The aquaculture
business includes mainly shrimp and some fish.
Products are divided into categories
a. Animal Feed : Directly Sold to Large farms
b. Animal Breeding: Directly Sold to Large farms
c. Meat & Food Products : Distributed to
wholesalers & retailers

Production Process

Products
FEED BUSINESS Products
Livestock feed product brands
CP, Hyprovite, Hi-Gro, Star Feed, Novo,
Safe Feed, Erawan, Hogtonal, C.F,
Anvipro, and Hilac
Aquatic feed product brands
CP, Star Feed, Novo, Erawan, Marine, HiGrade, Turbo, Blanca, Stargate, Safe Fo,
and Safe Fish

Products
FARM BUSINESS PRODUCTS
CPF operates commercial animal breeding and
animal farming businesses that cover five major
animals, namely swine, chicken, duck, shrimp and
fish
High quality and hygienic farms that do not use
growth stimulating substances or antibiotics,
prohibited by laws.
CPFs production processes involve advanced
technology and internationally certified standards;
therefore, our fresh meat is safe for consumers

Products

FOOD BUSINESS PRODUCTS

1. Chicken & Marinated fresh chicken
2. Pork & marinated fresh pork
3. Fish
4. Duck
5. Egg
6. Ready meal & Light Meal
7. Side Dish
8.Chicken Appetizer
9. Gyoza & Wonton Appetizer
10. Bakery
11. Processed Egg
12. Sauasage, Ham & bacon

Retail & Food Outlets

5 Star Business
As of 31 December 2014, there were 5,220 Five
Star kiosks across Thailand, 569 kiosks in
Vietnam, 213 kiosks in India and 24 kiosks in
Laos.
Chesters: As of 31 December 2014, Chesters
had 201 restaurants, 80 of which were
Company-operated, while 121 were franchiseeoperated.
CP Kitchen: . As of 31 December 2014, there
were 9 branches of CP Kitchen

Retail & Food Outlets

CP Fresh Mart : As of 31 December 2014,
CP Fresh Mart operated 610 retail stores in
Thailand: 244 in Bangkok and its vicinity,
and 366 in provincial areas, as well as
9,000 community refrigerators in Thailand
CP Fresh Mart Plus: As of 31 December
2014, there were 2 branches of CP Fresh
Mart Plus
CP Food World: . As of 31 December 2014,
there were 4 branches of CP Food World.

Risk factors
1. Strategic Risk
a. Change in consumer behavior : Increasingly greater values
are placed on convinience, health, freshness, cleanness,as well
as environmently-friendliness.
b. Climate Variability: Variability of climate conditions directly
impact agricultural productivity. This leads to fluctuation in
quality & price of raw materials.
c. Overseas Investment & Operations: Political situation, legal
requirements, trade policy, economic and labor market conditions,
languages and cultural differences, as well as currency exchange
rate fluctuations may affect overseas operations.

Risk Factors
2. Operational Risk:
a. Product quality & Safety : Ineffective Quality Control Measures
b. Animal Disease Outbreaks: Early Mortality Syndrome (EMS) in shrimp,
which first appeared in Thailand at the end of 2012
c. Efficiency of Supply Chain Management: The Company needs to manage
all stages of its supply chain, from feed manufacturing, farming and
aquaculture, food production, to retail and outlet businesses.
d. Volatility of Commodity prices : The farming industry has seen
significant expansion over recent years, and if such expansion does not
match the growth in consumption, it would result in greater volatility of
prices.
e. Ability to recruit & retain knowledgeable & capable stuff.

Risk Factors
3. Financial & Financial Reporting Risk:
a.Foreign Exchange Volatility
Therefore the Companys financial performance is subject
to fluctuation in exchange rates over any period of time.
b. Interest Rate Volatility : The Company makes financing
decisions based on current and forecast factors in the
financial and capital markets.
Borrowing at floating interest rates may cause the
Company faces the interest rate volatility risk .

Risk Factors
4. Compliance Risk
The Company must comply with laws, regulations, and business rules applicable
to each of its products and business units.
5. Corporate Image & Reputational Risk:
Dissemination of content with misinformation through multiple channels can
damage the Companys brand and corporate image and reputation. As the
Company operates an integrated agricultural and food business, society may
view the scope of its operations as a monopoly.

Moreover, as the leading feed manufacturer, the Company has been linked,
along with the rest of Thailands seafood industries, to human trafficking in the
fishing industry. Such issues can adversely impact the Companys credibility
and consumer confidence.

Risk Mitigation: What we have

done?

FINANCIAL ANALYSIS

2012
2013
2014
2015 9M Ended

Financial Highlights
2012-2014

Consolidated Statements of financial position of CPF

and its subsidiaries as of 31 December

Consolidated statements of income of CPF and its

subsidiaries for the years ended 31 December 2012,
2013 and 2014

Consolidated statement of cash flows

& Key Financial ratios

9months ended 2015

Consolidated Sales by Product 2015

OUR DIVIDEND POLICY

CPF has a policy to pay dividends to shareholders twice a year.
The first dividend payment is paid as an interim dividend, with the second dividend payment being paid
as an annual dividend. The total dividend paid each year will be approximately 50% of net income, after
the deduction of income taxes and the legal reserve (based on separate financial statements).
The annual and interim dividend payments may be subject to change, depending on such variables as
the Companys operations results, its financial position, future projects and prevailing economic
conditions at the time.
Additionally, CPF has a duty to comply with the terms and conditions of its debentures, which prohibit
CPF from paying cash dividends to shareholders in the event of CPF
being unable to service interest
payments on, or any other amounts owing to, the debenture holders.
For subsidiaries that are listed on foreign stock exchanges, the dividend payment will be depend upon
the Board of Directors meeting or Shareholders meeting resolution (as the case may be).
For subsidiaries that are non-listed companies, the dividend payment will depend upon their future
investment plans, their financial structure and liquidity. In the fiscal year ended 31 December 2014,
CPFs dividend income from subsidiaries totaled THB 13,990 million, of which THB 553 million was from
subsidiary that are listed on foreign stock exchange and THB 12,837 million was from subsidiaries that
are non-listed company.

OUR DIVIDEND POLICY

Stock Price 2012-2016

DEBENTURES?

Business Strategies
Target growth
Average annual 10+% growth
Key Drivers
1. Shrimp business Improvement
2. Existing International operations
expansion
3. Mergers and Acquisitions (M&A)

Business Strategies
Investment
5Yr Capexof THB 50,000 million
(excluding CPP) ; cautiously
investment for growth
Thailand: add value to existing
businesses International :
diversification & market expansion

CORPORATE SOCIAL RESPONSIBILITY

1. Food Security
a. Enhancing food quality & safety
throughout the chain.
b. Improving food access
2. Self Sufficient Society
a. Promoting Win Win Partnership
3. Balance of nature
a. Promoting resource efficiency
b. Conservation of bio diversity

CONCLUSION

 Q&A

References