WHA’s 1Q Net Profit Jumps 35.7%, Growth Remains in Sight with Positive Recovery in 2H21


WHA Corporation Public Company Limited (WHA) announced its Q12021 performance with total revenue and share of profits of THB 1,405.7 million, and a net profit of THB 134.7 million. Total normalized revenue and share of profits from operations stood at THB 1,454.3 million and normalized profits at THB 183.8 million. Chairman and Group CEO, Ms. Jareeporn Jarukornsakul assured performance of 4 business hubs still strong despite the current wave of Covid-19. Logistics business shows bright prospects with an influx of tenants. In Thailand, Industrial Estate land sales are better than expected, while in Vietnam, WHA Industrial Zone-Nghe An continues to expand. The Utilities business is recovering remarkably with the increased customer consumption of both water and power. All businesses foresee a promising outlook in the second half of this year, with customers ready to sign warehouse rental and land sale contracts. The company also targets to divest assets to REIT in Q42021.               

WHA reported the operating results for Q12021 with total revenue and share of profits of THB 1,405.7 million, and a net profit of THB 134.7 million representing an increase of 10.0% and 35.7% respectively. Normalized total revenue and share of profits stood at THB 1,454.3 million while normalized net profit amounted to THB 183.8 million, representing an increase of 3.9% and decrease of 12.8% respectively compared to the same quarter last year. This has reflected strong performance of the company’s operations amidst the current wave of Covid-19. Furthermore, the shareholders’ meeting has approved a dividend payment for the 2020 fiscal year of total THB 0.1002 per share, consisting of an interim dividend paid to shareholders at THB 0.0367 per share and additional payout at THB 0.0635 per share to be paid on May 25, 2021.

Ms. Jareeporn Jarukornsakul, Chairman and Group CEO of WHA Corporation PCL, disclosed that the Logistics business has grown remarkably despite an ongoing pandemic. Currently, the team are in active discussion with several customers who are looking to lease over 200,000 sq.m. of BTS warehouse and warehouse farms together. For Q12021, the company recognized revenue from the rental business worth THB 277.1 million, the amount is similar to the previous year.  During the period, the company has signed short-term high-yield rental contracts for 25,949 sq.m., achieving more than half of annual target of 50,000 sq.m. Strong demand for premium warehouse and distribution center also bring the Q1 occupancy rate to 90%. With a positive outlook for the rest of the year, WHA Logistics still aims to expand the space for new projects in 2021 by 175,000 sq.m., and to sell an additional 180,000 sq.m. of assets to REIT within Q42021.

The company plans to develop five additional large distribution centers for a total area of over 400,000 sq.m. Moreover, to be in-line with current digital transformation trend of logistics business, the company is ready to invest in smart warehouse technology as well as to offer value-added solutions to help tenants to benefit from data analytics, such as inventory management, route management that not only improve efficiency of our customers, but also reduce Thailand’s overall logistics costs.

In the Industrial Estate business, customers, especially Chinese investors, continued to show interest in purchasing land as there is no slowdown in their inquiries. During Q12021, the company sold a total of 213 rai, of which 188 rai was in Thailand. Due to delays in land ownership transfers and entry restrictions to the country, there are substantial backlogs. Owing to vaccine production and distribution in Thailand and other countries, the company expects to see the sign of recovery in the manufacturing flow and foreign investment in the second half of 2021. Therefore, the company maintains its target to sell 725 rai of land in Thailand this year.

In Q1 2021, the company recognized income from industrial estates totaling THB 154.1 million, slowing down from the same period last year. However, the company has recorded rights of way compensation at THB 125 mm thus reducing the total revenue by only 37.2% from the same period last year. Currently, the company is also coordinating with the Board of Investment (BOI) to promote online transactions.

The company aims to develop and expand new industrial estates continuously. WHA Rayong 36 is now open and is ready to welcome investors.  Besides, this year, the company plans to expand three industrial estates and already launched TusPark WHA, an innovation incubator center last March. The company has established a Unified Operation Center (UOC) at WHA Tower, a solution platform that leverages on digital technology to manage WHA industrial estates more efficiently. The UOC serves as a monitoring and management control center for air quality, rainfall, water quality and other components under the “Smart ECO Industrial Estate” concept.

In Vietnam, the company sold a total of 25 rai in Q1 2021. The company already received a certificate of amendment of registration for WHA Industrial Zone-Nghe An Phase 1. In order to achieve this year’s sales target of 308 rai in Vietnam, currently, it is accelerating the sales and construction work of Phase 1B’s remaining area. It is also laying out a master plan to develop Phase 2 and Phase 3, which account for an additional 4,700 rai and working on a license and approval to develop two industrial zones in Thanh Hoa province, representing over 7,500 rai, in line with the target plan.

For the Utilities business, the company recognized revenue of THB 586.3 million in Q12021, an increase of 9.8% compared to Q12020. This is a result of an increase in water sales and management volume in Thailand and Vietnam as major customers in the petrochemical, power and automotive sectors resume their normal operation. Unlike Q12020, during Q12021 there was no impact from the drought and Covid-19 lockdown measures. Furthermore, water demand has increased since Q42020 as new customers started commercialization.

In addition, the company is now offering more value-added products to its customers. For example, its Reclamation Plant, Thailand’s largest project which has a production capacity of 25,000 cubic meters per day, already started production in January 2021. Through the water-reclaimed process, WHAUP turned used water into Demineralized and Premium Clarified Water and sold it to its customers. This demineralized-reclaimed water project also serves as a sustainable model of using innovative technology to manage and control supply of water resources, allowing the company to reduce existing reliance on major water suppliers. In Q12021, the company sold value-added water products totaling 1 million cubic meters, representing a growth rate of 203% compared to the same period last year.

For Power business, the company recognized a share of normalized operating profits from investments in subsidiaries and joint ventures, excluding profit and loss from foreign exchange, totaling THB 165.6 million. In Q12021, the company won additional PPA contracts for solar projects at 10 MW, representing total accumulative solar PPA of 61 MW and started commercial operations (COD) to produce and sell solar power to customers totaling 4 MW, bringing total COD capacity to 44 MW. It expects to sign additional solar PPA contracts of not less than 40 MW during the year. The company maintains its target of 90 MW by the end of 2021 and 300 MW by 2023.

Profits from Power business declined in Q12021 due to a drop in shared profits from the Gheco-One power plant after a 37-day overhaul, resulting in decreased availability payment from EGAT. However, for the remaining period of this year, Gheco-One will receive compensation and lost revenue shall be able to recover. The 8 other SPP power plants and the waste-to-energy Chonburi Clean Energy (CCE) power plant continued to see strong performance. There is no plan for overhaul shutdown of other power plants this year.

Presently, the company is seeking an approval for its Peer-to-Peer Energy Trading project, an initiative that is also in line with the preparation and installation of an energy storage system at the company’s water filtration plant. This not only emphasizes the company’s experience and expertise, but also reflects its readiness to become the leader in the clean energy business by continuously offering new services to its customers.

Digital Platform Business: The company is now conducting a feasibility study for 5G Tower investment with leading telecom operators to install and test 5G solutions within WHA industrial estates. For FTTx business, it has accelerated the rollout plan that targets the coverage of all industrial estates by the end of this year. Infrastructure sharing such as 5G Tower and FTTx, will pave the way for digital transformation for the company, customers, entrepreneurs, as well as support Thailand’s move towards Industry 4.0.

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