ThaiBev 9M25 Earnings: Resilient Beer Profits, Flat Sales, and Rising Costs—What Retail Investors Need to Watch

Key Highlights from Thai Beverage’s Nine-Month Business Update (Ended 30 June 2025)

• Group sales revenue remained flat year-on-year despite challenging consumer sentiment.
• Beer business delivered robust EBITDA growth, even as sales revenue declined slightly.
• Spirits business maintained stable sales, but profits slipped due to higher marketing spend.
• Non-Alcoholic Beverages and Food segments saw margin and profit pressures.
• Net interest-bearing debt and leverage ratios increased, a potential concern for shareholders.
• Cash reserves declined by over 10% since September 2024.

Segment-by-Segment Breakdown

Spirits

ThaiBev’s flagship Spirits business posted virtually unchanged sales revenue at Baht 92,778 million for the nine months ended 30 June 2025, despite a small 0.8% dip in sales volume. However, EBITDA for this segment dropped by 5.4% to Baht 22,161 million. The main culprit: increased marketing expenses aimed at brand investment and launching new products. Notably, the international segment, including Myanmar, performed well, and profitability improved in the latest quarter compared to last year.

Beer

The Beer segment faced challenging market conditions, particularly in Vietnam, leading to a 0.3% decline in revenue to Baht 96,497 million. However, the business turned in a strong performance on the profit front, with EBITDA rising 4.0% to Baht 12,573 million. This was driven by a 4.8% increase in total sales volume, lower raw material costs, and improved production efficiency. The EBITDA margin improved from 12.5% to 13.0% year-on-year—a positive sign indicating operational resilience.

Non-Alcoholic Beverages (NAB)

NAB revenues slipped 0.7% to Baht 49,326 million, despite a rise in sales volume. EBITDA fell 6.3% to Baht 8,718 million as a result of higher marketing and brand investments, and a lower share of profit from associates. This margin pressure is an area investors should watch closely.

Food

The Food segment saw a 1.4% drop in revenue to Baht 16,563 million, reflecting weak consumer sentiment and subdued demand. EBITDA fell sharply by 19.5% to Baht 1,578 million due to rising raw material and labor costs—highlighting the sensitivity of this business to input inflation and market demand.

Others

The “Others” segment (mainly publishing and printing) posted a 5.9% decline in sales to Baht 3,626 million and a negative EBITDA of Baht 4 million, with last year’s one-off contributions absent and higher printing costs impacting results.

Financial Position and Leverage—Red Flags for Investors?

• Total assets decreased by Baht 13,325 million to Baht 514,268 million.
• Shareholders’ equity dropped by Baht 13,504 million to Baht 215,551 million.
• Interest-bearing debt marginally fell by Baht 1,700 million to Baht 232,526 million, but net interest-bearing debt rose by Baht 3,974 million to Baht 184,135 million due to a fall in cash reserves.
• The Net Interest Bearing Debt to Equity ratio increased from 0.79 to 0.85, and Net Interest Bearing Debt to EBITDA (LTM) ratio rose from 2.92 to 3.13, suggesting slightly higher leverage and debt risk.
• Cash and cash equivalents fell by Baht 5,674 million to Baht 48,391 million over the period, reflecting negative cash flow after investing and financing activities.

Cash Flow Update

For 9M25, ThaiBev generated Baht 35,675 million in net cash from operating activities, but this was offset by Baht 5,522 million used in investing activities and Baht 34,499 million used in financing activities. The net result was a decrease in cash and cash equivalents by Baht 5,674 million during the period.

What Should Shareholders and Potential Investors Watch?

• Resilient Beer Profits: Despite weaker revenue, the beer segment’s improved margin and EBITDA could support the share price if investors focus on operational efficiency and cost management.
• Pressure on Profits Elsewhere: Declining EBITDA in Spirits, NAB, and especially Food raises questions about the sustainability of group-wide profit growth if cost pressures persist.
• Rising Leverage: A higher debt-to-equity ratio could become a concern, particularly if operational cash flows weaken or interest rates rise.
• Cash Flow and Liquidity: The steady decline in cash reserves may limit flexibility for future investments, dividends, or debt repayment, a key risk for shareholders.
• Unreviewed Figures: The report is based on management accounts and has not been audited, so figures could change upon final review.

Potential Price-Sensitive Points

• Profit margin expansion in Beer and international Spirits operations could offset weakness elsewhere, supporting the stock.
• Worsening leverage ratios and reduced cash reserves may raise red flags for income- and risk-focused investors.
• Ongoing margin pressures in NAB and Food segments could weigh on sentiment if not addressed in future quarters.
• Absence of one-off gains in the “Others” segment dragged profitability and may lead to lower group earnings compared to last year.

Conclusion

ThaiBev’s 9M25 business update is a mixed bag for retail investors. Operational resilience in the Beer segment and international Spirits is a clear positive. However, declining profitability in other core segments, rising debt ratios, and falling cash reserves highlight growing financial risks. These trends could be price sensitive, especially if cost pressures and leverage continue to climb. Investors should monitor upcoming audited results and management’s actions to address these challenges.

Disclaimer: This article is for informational purposes only and is not financial advice. Figures are based on unaudited management accounts and may be subject to change. Always conduct your own research or consult a professional before making investment decisions. The author and publisher are not responsible for investment decisions based on this content.

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