3-year Financial summary

Financial Highlights (Consolidated Financial Statements)

  FY 2016 FY 2015 FY 2014
  (Baht in millions, except share, per share data and ratio)
Statement of Income
Sales of residential condominium units 5,073.58 5,042.34 6,547.11
Total revenues 5,206.43 5,145.49 6,647.15
Cost of residential condominium units sold 3,181.42 3,016.13 3,832.48
Total expenses 4,037.05 3,846.15 4,874.80
Gross profit from core business 1,892.17 2,026.21 2,714.64
Net profit (loss) 850.60 900.46 1,224.50
Net profit (loss) - Equity holders of the Company 850.65 900.90 1,224.52
Statement of Financial Position
Total assets 9,700.13 9,946.98 11,190.70
Total liabilities 4.592.24 5,495.99 7,646.52
Issued and paid up share capital 3,575.48 3,575.48 3,575.42
Total shareholders' equity 5,107.89 4,450.99 3,544.17
Equity attributable to owners of the Company 5,105.38 4,448.42 3,541.17
Liquidity Ratios (times)
Current ratio 3.01 2.09 1.57
Quick ratio 0.52 0.18 0.17
Profitability Ratios (%)
Gross profit margin (1) 37.29% 40.18% 41.46%
Net profit margin 16.34% 17.50% 18.42%
Return on equity (2) 17.81% 22.55% 41.91%
Return on assets 8.66% 8.52% 9.89%
Efficiency Ratios (times)
Total assets turnover 0.52 0.51 0.59
Leverage Ratios (times)
Debt to equity ratio 0.90 1.23 2.16
Interest-bearing debt to Equity 0.58 0.65 1.00
Net debt to Equity (3) 0.35 0.53 0.86
Interest coverage ratio   (4) 12.42 8.48 13.28
Percentage of Growth (% per year)
Total asset growth -2.48% -11.11% -17.62%
Total liabilities growth -16.44% -28.12% -32.20%
Total shareholder’s equity growth 14.76% 25.59% 53.66%
Total revenues growth 1.18% -22.59% 15.29%
Total expenses growth (5) 4.03% -18.68% 5.88%
Per Share Ratios (Baht)
Earning per share 0.24 0.25 0.34
Book value per share (6) 1.43 1.24 0.99
Other Financial Data
Net cash flows from operating activities 1,592.63 657.76 1,914.42
Net cash flows from investing activities (814.06) 9.20 (61.74)
Net cash flows from financing activities (148.99) (659.63) (1,910.73)

(1)Gross profit margin = (total sales – cost of sales) / total sales, whereas total sales consists of sale of residential condominium units

(2)Return on equity = Profit (loss) - Equity holders of the Company / the average of total shareholders' equity of this year and last year

(3)Net debt to equity = Total debt less cash and cash equivalent / total shareholders' equity

(4) Interest coverage ratio = Profit (loss) before finance cost and income tax / finance cost, finance cost means interest and other charges associated with financing eg. front end fee, etc.

(5) Exclude the impairment loss of investment properties and reduction of project development cost to net realisable value

(6) Book value include non-controlling interests of the subsidiaries

Management Discussion and Analysis

Overall Performance

For FY2016, The Group achieved consolidated net profit and EBITDA of Baht 851 million and Baht 1,270 million respectively. Consolidated gross margin marginally decreased from 40% in FY2015 to 37% in FY2016.

As of 31 December 2016, backlog totaled Baht 4,045 million, with the Lofts Asoke contributing to 44% of total amount. The Lofts Ekkamai constituted 32% of total backlog, with Unixx South Pattaya, 185 Rajadamri, Zire Wongamat, and the River constituting 11%, 5%, 11%, 4% and 4%, respectively.

Due to steady transfer of units at Unixx South Pattaya, 185 Rajadamri, and the Lofts Ekkamai, the Group was able to pay back its debt resulting in decrease of interest-bearing debts approximate Baht 54 million. As a result, consolidated interest-bearing debts to equity ratio stood at 0.58 times as of 31 December 2016, a reduction from 0.65 times as of 31 December 2015.

Discussion on Profit and Loss

Revenues

In FY2016, the Group recorded consolidated revenues of Baht 5,206 million, a decrease of Baht 61 million (or 1%) when compared with FY2015. 97% of consolidated revenues was derived from recognized sales income (i.e. transfer income) from residential condominium units for 5 projects, namely: Unixx South Pattaya (Baht 1,922 million or 37%), 185 Rajadamri (Baht 1,195 million or 23%), the Lofts Ekkamai (Baht 874 million or 17%), Zire Wongamat (Baht 718 million or 14%), and The River (Baht 365 million or 7%).

Project FY2016 FY2015
  Revenue (Million Baht) % Revenue (Million Baht) %
Unixx South Pattaya 1,922 37% 18 1%
185 Rajadamri 1,195 23% 2,795 54%
The Lofts Ekkamai 874 17% - 0%
Zire Wongamat 718 14% 1,716 33%
The River 365 7% 513 10%
Others* 132 3% 103 2%
Total 5,206 100% 5,145 100%

* Include rental and service income, marketing commission income, project management fee, interest, and others

Cost of Goods Sold

In FY2016, consolidated cost of goods sold increased mainly from addition of transfer units at Unixx South Pattaya and the Lofts Ekkamai, net of the reduction of transfer units at 185 Rajadamri and Zire Wongamat.

Project FY2016 FY2015
  Cost of sales (Million Baht) % Cost of sales (Million Baht) %
Unixx South Pattaya 1,212 38% 11 0%
185 Rajadamri 563 18% 1,472 49%
The Lofts Ekkamai 656 20% - 0%
Zire Wongamat 503 16% 1,208 40%
The River 247 8% 325 11%
Total 3,181 100% 3,016 100%

Gross Profit Margin

Consolidated gross profit margin reduced marginally to 37% in FY2016, a reduction from 40% in FY2015. However, the Group still maintained healthy gross profit margin with insignificant change.

Selling and Administrative Expenses

Consolidated selling and administrative expenses were second largest expenses for the Group. Consolidated selling and administrative expenses represented 21% of total expenses for FY2016. The amount increased from Baht 830 million in FY2015 to Baht 856 million in FY2016 (a 3% increase).

Selling and administrative expenses FY2016
(Million Baht)
FY2015
(Million Baht)
FY2014
(Million Baht)
Change FY2014 - 2016 (%)
Salary and staff benefits and management’s remuneration 223.1 224.3 252.0 -11.5%
Special business tax & transfer fees 190.2 210.4 283.5 -32.9%
Other selling expenses 100.9 116.0 127.7 -21.0%
Other expenses 341.4 279.3 379.1 -9.9%
Total 855.6 830.0 1,042.3 -17.9%

Cost of Financing

Consolidated cost of financing primarily resulted from interest costs in association with project loans, which are capitalized as development costs for respective projects till completion. Thereafter, such interest costs will be recorded as finance costs in the Statement of Income. Upon project completion, loans are repaid in installments along with transfer of ownerships. For FY2016, the Group’s consolidated cost of financing decreased approx. Baht 59 million due to the facts that Unixx South Pattaya and the Lofts Ekkamai completed and started the transfer of ownerships in 4Q2015 and 3Q2016, respectively, thus the loan associated with Unixx South Pattaya project was fully paid at the beginning of 3Q2016. Also, major loans associated with the Lofts Ekkamai were paid during the year. This resulted cost of financing decreased year-on-year; although, the Company issued THB 1,000 million unsecured debenture on 21 September 2016 and drew down the loan for a subsidiary’s project development costs totaling Baht 510 million around the end of December 2016.

Net Profits (Losses)

In FY2016, The Group had consolidated net profit of Baht 851 million, compared with Baht 900 million in FY2015. The decrease was mainly because the Group’s consolidated gross margin decreased marginally from 40% in FY0215 to 37% in FY0216.

FY2016 Earnings Per Share was 0.24 Baht (FY2015: Earning Per Share 0.25 Baht)

Discussion on Balance Sheet

Assets

The Group’s consolidated total assets as at 31 December 2016 decreased by Baht 247 million (YoY decrease of 2%) when compared to that of 31 December 2015. Significant changes in consolidated total assets were primarily from the reduction of project development costs due to unit transfer associated mainly with Unixx South Pattaya, 185 Rajadamri, and the Lofts Ekkamai, net of additions of land for development cost, land awaiting development and deposit for leasehold right at the amount of Baht 810 million, Baht 492 million, and Baht 300 million, respectively.

Liabilities

As of 31 December 2016, the Group’s consolidated total liabilities decreased by Baht 904 million (YoY decrease of 16%). The reduction was due mainly for revenue recognition associated with deposits mainly attributable to the unit delivery at 5 projects.

Shareholders’ Equity

As of 31 December 2016, consolidated Shareholders’ Equity totaled Baht 5,108 million, an increase of Baht 656 million (or 15%YoY) from FY2015, due to consolidated net profit totaling of Baht 851 million for the FY2016, offset with dividend payment of Baht 197 million.

Discussion on Cash Flows and Capitalization

Cash Flows

  FY2016
(Million Baht)
Cash and cash equivalents at the beginning of the year 486
Net cash flow from operating activities 1,592
Net cash flow from investing activities (796)
Net cash flow from financing activities (149)
Cash and cash equivalents at the end of the year 1,133

During 2016, the Group had a positive net cash flow from operating activities totaling Baht 1,592 million, primarily resulting from cash inflow associated with unit delivery at Unixx South Pattaya and 185 Rajadamri during the year.

During 2016, the Group had a negative net cash flow from investing activities totaling Baht 796 million, primarily resulting from the purchase of land awaiting development and deposit for leasehold right totaling Baht 492 million and Baht 300 million, respectively.

During 2016, the Group had a negative net cash flow from financing activities totaling Baht 149 million, primarily due to loan repayment totaling Baht 1,310 million which mainly from the transfer of ownership of Unixx South Pattaya and the Lofts Ekkamai starting in 4Q2015 and 3Q2016, respectively, also, dividend payment of Baht 197 million, net of issuance of unsecured debenture and project loan drawn down at subsidiaries totaling Baht 1,367 million.

Overall, the ability to transfer units in the Group’s increased consolidated interest-bearing debts by approximately Baht 54 million only. In addition, FY2016 consolidated net profit of Baht 851 million increased shareholders’ equity base, resulting in interest-bearing debts to equity ratio reduced from 0.65x to 0.58x for FY2015 and FY2016 respectively.

Commitments and contingent liabilities

The Group has pending litigation cases, relating to allegations of breaches of agreements to purchase and to sell from some customers and torts. However, the Company and its subsidiaries are defending the lawsuits, and since the Company’s lawyers and management believe that the Group will not have a material effect from the litigation, no addition entries have been made in respect of these cases beyond provision already recorded.