Minor International Public Company Limited

Reported first-half core revenue was THB 82.8 billion, up 3% year over year, and core net profit was THB 3.7 billion, up 6% year over year. Core net profit margin improved by 10 basis points year over year. In Hotels, core hotel revenue increased 3% and profit rose 7% to about THB 2.4 billion; in Food, core revenue rose 4% and core profit rose 3% to THB 1.3 billion. By market, Europe/Americas owned and leased RevPAR increased 5% in euro terms, Thailand RevPAR increased 11%, Maldives increased 4%, and Australia declined 1%. Looking ahead, management reaffirmed more than 50 hotel signings for full-year 2026, said at least 11 additional openings are expected in the second half, and maintained 2028 aspirations of about 850 hotels and 4,150 restaurants. For 2026 CapEx, the company expects THB 15 billion to THB 16 billion. The Bonchon IP deal was described as a $50 million net investment, with returns said to be double-digit ROIC and high double-digit IRR; management said it should be low-single-digit accretive to earnings initially.

The CEO framed the quarter as one of continued strategic execution rather than just financial reporting, emphasizing asset-light growth, brand conversions, and new market entry. He highlighted the breadth of openings and conversions across Thailand, Italy, Australia, Zambia, Laos, Turkey, and elsewhere as proof that the brand architecture is resonating with owners. His tone was confident and forward-looking, repeatedly saying the company is ahead of plan on hotel signings and can keep expanding despite geopolitical volatility.

The financial commentary focused on resilience, cost control, and balance sheet management. He said labor costs are about 28% of revenue and are expected to be contained at mid-single-digit inflation, while direct costs are about 24% of revenue and should see low-single-digit inflation; in Europe, more than 90% to 100% of energy needs are hedged. He also pointed to average cost of debt falling to about 4.1% in Q2 from 4.4% a year ago, while net interest-bearing debt-to-equity was 1.1x and net debt-to-EBITDA was 4.72x at quarter-end, both higher than end-2025 due to perpetual bond redemption and seasonal working-capital needs. He reiterated 2026 CapEx of THB 15 billion to THB 16 billion and said cutbacks elsewhere offset the Bonchon acquisition spend.

Analysts asked why margin is expected to expand in 2027 versus 2026, and management pointed to a larger asset-light mix, more direct bookings that avoid commission costs, and back-office efficiency gains from ERP migration, outsourced processes, and automated enterprise performance management. On Bonchon, management said the deal’s contribution cannot yet be fully disclosed because it has not closed, but reiterated double-digit ROIC, high-double-digit IRR, and low-single-digit EPS accretion initially. Asked about expansion, management said Bonchon has about 345 outlets outside the Americas today and could reach 500-plus over the next five years, using Minor’s existing geographic footprint. Management also said the bond redemption changed the accounting presentation of debt but not cash itself, and projected cost of funds around 4.1% to 4.2% in 2026, with next year likely similar or slightly higher depending on rates.