MINT: Time to Harvest the Profit!

It is quite a disappointment to see a plummet of Minor International Public Company Limited (MINT)’s share price even though the company posted a higher net profit in the quarter.

 

In the third quarter of 2019, MINT recorded a net profit of 4,560 million baht, increased 347% when compared to the same period of last year which recorded a net profit of 1,020 million baht. Meanwhile, a net profit for the nine-month period was 6,926 million baht, increased 76% from a net profit of 3,944 million baht last year.

When taking a look at MINT’s financial statement, its profit from operations in the quarter was 1,417 million baht, increased 39% year-on-year (YoY), but decreased 32.5% quarter-on-quarter (QoQ), which was lower than the market had anticipated.

This might be one of the reasons for the plummet in the past days.

However, it is understandable regarding the lower revenue as the third quarter of the year is a low season for the business while also affected by the strong thai baht as well.

 

The reason for the surge in MINT’s net profit was due to an extraordinary item of the sale and leaseback of three Tivoli’s hotels in Portugal, resulting in a one-time earning of 3,500 million baht.

Nevertheless, the gem in this financial statement is the revenue from NH Hotel Group or NH Hotel (NHH) which will be the main drive for MINT’s growth, offering a constant income to the company.

MINT reported an operating revenue in the quarter at 29,497 million baht, increased 86%. The revenue can be breaking down as follows; 5,686 million baht from food and restaurant business, decreased 3%, 1,192 million baht from distribution and production business, increased 12%, and 22,619 million baht from hotel business and others, increased 152%.

 

After taking a deeper look on its hotel business, the portion that NH Hotel contributed to the revenue was 14,676 million baht or 77% while the revenue other hotels in MINT’s chain contributed 7,942 million baht.

The portion contributed by NH Hotel has emphasized its importance as a part of MINT. From now on, it is time to harvest what the company had planted.

 

More importantly, it is possible to see a synergy between hotels in MINT and NH Hotel’s chains as well. MINT’s customers could have check-in into hotels in NH Hotel’s chains and likewise for NH Hotel’s customers.

This will keep customers within the group. It is a win-win scenario. And the bottom-line profit will be booked in MINT’s financial statement.