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Message from the Chairman
Dear Shareholders,
2013 was another remarkable year for Thai Beverage Public Company Limited ("ThaiBev"). During the year, we expanded our beverage business from the national level to the regional level with our investment in Fraser and Neave, Limited ("F&N"), the largest ever acquisition in Singapore's corporate history. The investment marked a significant step forward in our journey to achieve our goal of becoming a world-class total beverage producer and distributor. In Thailand, we continued to maintain our leadership in the alcoholic beverage market, and our spirits business achieved robust revenue growth. In addition, we focused on further developing our non-alcoholic beverage business through sales promotion and advertising activities that sought to raise awareness of our new brands among consumers.

ThaiBev achieved a total revenue of Baht 155,771 million in FY2013, a slight decrease of 3.3 percent when compared to the previous year. We also recorded an 18.2 percent year-on-year increase in net profit to Baht 19,002 million (excluding gains from our investments in associate companies), due to an increase in our share of F&N's profits. On the back of the solid performance, ThaiBev announced a dividend payment of Baht 11,048 million in aggregate to our shareholders, or Baht 0.44 per share.

Our alcoholic beverage business continued to grow in 2013, as a result of an increase in revenue and net profit generated by our spirits business, as well as our products' strong brand equity. Our beer business also achieved positive earnings before interest, tax, depreciation, and amortisation as our cost control strategy to increase the contribution margin per unit proved effective. The steps we took to reinforce the brand image of our beer products also aided in the improvement of our beer business.

It was a challenging year, however, for our non-alcoholic beverage business, especially with the expiry of Sermsuk's production and distribution agreement with an international enterprise at the end of 2012. In turn, we launched our own carbonated soft drink brand, thereby venturing into a new market segment. Consumer feedback about the brand over the past year has been positive. In the green tea business, we continued to innovate, launching new products and flavours. We also embarked on regular marketing activities to raise awareness of our products. In addition, we expanded our green tea business into other countries in Southeast Asia, with favourable sales performance results.

During the year, ThaiBev also started to collaborate with F&N, tapping on synergies to enhance both companies' distribution networks, as well as product and brand development capabilities, on a regional level. Notably, ThaiBev launched Oishi's green tea products in Malaysia, and made plans to deepen the market penetration of F&N's beverages in Thailand. We intend to leverage the connectivity across the region, and optimise our logistical operations so as to position ThaiBev to benefit from the actualisation of the ASEAN Economic Community in 2015. This would strengthen our presence as a total beverage company in the region.

Having come this far, I would like to convey my sincere appreciation to the management team of ThaiBev and all employees for their dedication, perseverance, and hard work. Each and every one of them has played a key role and contributed greatly to our efforts to grow our business, and realise our vision of becoming a world-class regional total beverage company. I believe that as we continue to operate with virtuous work ethics, and uphold the highest standards of corporate governance, transparency, and social responsibility, ThaiBev can grow in a respectable and sustainable manner.

On behalf of ThaiBev's Board of Directors, I would like to thank you, as well as our customers and business partners for the trust and confidence placed in us all these years. I look forward to your continued support in the years ahead.
Charoen Sirivadhanabhakdi
Chairman of the Board
CEO Talk
Dear Shareholders,
2013 was another challenging year for Thai Beverage Public Company Limited ("ThaiBev") as the business was affected by an increase in excise tax rates, heightened competition in the non-alcoholic beverage segment, and the precarious political situation at the end of the year. Nevertheless, being a resilient company, ThaiBev was able to generate a total revenue of Baht 155,771 million during the year, a slight decrease of only 3.3 percent from 2012.

Despite the slowdown in sales, we remained the leader in the spirits market in Thailand. We also widened our beverage production and distribution network to the regional level through our investment in Fraser and Neave, Limited ("F&N"), which also enabled us to further diversify our product portfolio as a total beverage company. We now boast a wide variety of products ranging from Thai spirits, Chinese spirits, Scotch whiskies, and beer, to drinking water, ready-to-drink green tea, carbonated soft drinks, electrolyte beverages, dairy products, and soya milk.

Remarkably, despite the excise tax hike which impacted net sale price, our spirits business achieved a total sales growth of 7.3 percent from the previous year, and net profit rose 3.2 percent year-on-year. This was attributable to our products' strong brand equity and the dedication of our sales team. In addition, we also enlarged our portfolio of premium spirits with the launch of 'Blend 285 Signature', which offers a uniquely appealing taste, and comes in elegantly designed bottles with classy labels comparable with that of eminent international brands. These initiatives were part of our thrust to develop high-quality products for sale at reasonable prices, so as to capture the higher end of the market. Our pricing strategy also resulted in favourable outcomes for our beer business, which achieved positive earnings before interest, tax, depreciation, and amortisation, and reported a smaller net loss.

Notwithstanding the intensified competitive environment, we were able to maintain our market share in the non-alcoholic beverage segment as we continued to focus on raising consumer awareness of our quality products through marketing activities. Furthermore, we began distributing Oishi's green tea in neighbouring countries, such as Myanmar and Malaysia, expanding our reach beyond existing markets such as Laos and Cambodia where we already have strong presence. To expedite the growth of our young carbonated soft drink brand, 'est', we also embarked on a drive to enhance the brand's international image by sponsoring Manchester City Football Club. This sponsorship also aims to rapidly increase the brand's visibility among target consumers, especially within ASEAN markets.

In our food business, we placed great emphasis on expanding Oishi's network of food outlets, particularly in large cities in Thailand where there has been an increase in purchasing power. In addition, Oishi diversified beyond the buffet restaurant sector, opening other types of restaurants and launching new food products for sale at retail stores across the country. These include refrigerated food, frozen food, and Japanese snacks. The launches put us in good stead to capitalise on the continuously growing popularity of Japanese food in Thailand.

Executing our business expansion plan for ASEAN markets, we implemented our strategy of collaboration with F&N. The collaboration enables both companies to share experiences and resources, as well as tap on each other's expertise in the food and beverage business, in order to enhance both companies' capabilities and already comprehensive product portfolios.It also lays the foundation for ThaiBev to expand our consumer base to include muslim consumers, with the potential addition of halal food and beverage items produced utilising compliant ingredients, methods, and F&N's facilities in Malaysia.

A key pillar supporting our business expansion initiatives is the contribution of our employees. Recognising the importance of human resources, we rolled out a "Year of Greater Efficiency" campaign in 2013 as part of the "ThaiBev Core Values" project. As part of the campaign, we encouraged employees across ThaiBev and our subsidiaries to submit ideas under "The Greater Efficiency Contest 2013" to suggest ways to enhance work efficiency. The contest provided a platform for employees to showcase their knowledge and competency, share tips and best practices, and explore innovative solutions in a bid to increase the efficiency and effectiveness of their respective business units.

Finally, I would like to take this opportunity to thank you, as well as our business partners for the trust placed in us. I would also like to express my gratitude to all our directors, executives, and employees for their resolve and their dedication to every mission over the past year. I truly hope that ThaiBev will receive your continuous support and encouragement as we jointly drive ThaiBev's business forward in the coming years, all the while upholding stellar standards of corporate governance and citizenship.
Thapana Sirivadhanabhakdi
President and CEO
As of date 01/06/2014