Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Part 4:
3. The Valuation of Natural Park Public Company Limited (“NPARK”)
Information and details relating to NPARK can be found in Attachment 1 of this IFA
report.
Under this section, the IFA has considered the shareholders’ equity value of NPARK
and commented on the appropriateness on the issuance new NPARK shares as a form of
purchase consideration.
3.1
Book Value Approach
This approach determines NPARK’s shareholders’ equity value at a certain point in
time. In this case, the calculation is based on NPARK’s latest financial statements as at
September 30, 2014 which have been reviewed but not audited by Karin Audit Company
Limited (an approved auditor by the Office of the SEC). A summary of this approach is as
follows:
Prior to the Capital Increase (Rights offering)
(Unit: THB Million)
Paid-up registered capital as at September 30, 2014
Discount on ordinary shares
180,637.71
(168,467.96)
Retained earnings (losses)
(7,942.72)
Other components of shareholders equity
2.37
Book Value of NPARK
4,229.41
Remark: The transaction between BTSG and NPARK is contingent on NPARK’s rights offer on 16-17 and 20-22 October 2014
being fully subscribed. The IFA has, therefore, considered the Book Value for NPARK as reported on September 30,
2014, and additionally under the assumption that the rights offer is fully subscribed.
Post Capital Increase (Rights offering)
(Unit: THB Million)
Paid-up registered capital as at September 30, 2014
Discount on ordinary shares
361,275.42
(342,783.35)
Retained earnings (losses)
(7,942.72)
Other components of shareholders equity
2.37
Shareholders’ equity
10,551.73
By this approach, the Shareholders’ Equity of NPARK is valued at approximately
THB 10,551.73 million.
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3.2
Natural Park Public Company Limited
Adjusted Book Value Approach
By this approach, the shareholders’ equity value of NPARK is derived from total
assets, reduced by total liabilities including commitments and contingent liabilities as
reflected in the latest financial statements, and adjusted by items that occurred after the end
of the accounting period or items that may reflect the actual value of assets and liabilities.
There are further adjustments on the items that occurred after the end of the accounting
period or items that may reflect the actual value of assets and liabilities. The adjustment
items may include unrealized gain or loss from asset revaluation, asset impairment, write-off
for doubtful accounts receivable or lending, losses carried forward that could be used as tax
credit, and any legal disputes.
The Adjusted Book Value Approach for NPARK is calculated by adjusting the Book
Value as at September 30,2014 by the following items:
3.2.1 An Increase in Paid Up Capital
During the period of 16-17 and 20-22 October 2014, NPARK allocated and offered
newly-issued shares, with a par value of THB 1, to existing shareholders through a pro-rata
rights offer in the ratio of 1 newly-issued share for 1 existing share at a price of THB 0.035
per share.
NPARK issued a total of 180,637,710,882 shares, thereby increasing the Company’s
Registered and Paid-up Capital from THB 180,637,710,882 to THB 361,275,421,764. On 31
October 2014, NPARK’s Registered and Paid-up Capital was approved by the Ministry of
Commerce. The proceeds from the rights offer were THB 6,322,319,880.870001.
The effect of this transaction is an upward adjustment to the book value of NPARK in
the amount of THB 6,332.32 million.
3.2.2 Revaluation of Appraised Properties
NPARK appointed T.A. Management Corporation (1999) Co., Ltd (“TA” or
“Independent Property Appraiser”), an independent property appraiser approved by the
SEC, to appraise the property. The appraisal reports are issued for a public purpose, the
details of the appraisal reports are summarized below:
3.2.2.1
Natural Park Public Company Limited (Thailand)
Land
1.
Asset Class
1 plot of vacant Land with a total area of 2-1-14.2 rai (or 914.2 sq.wah)
Asset Location
Soi 47 Sukhumvit Road, Bangkhen, Bangkok.
Obligation
Mortgage Insurance Bank of Thailand (SET)
Method of Valuation
Market Approach
Valuation Date
November 14, 2014
Appraisal
THB 118,846,000
Forced sale of 65%
THB 77,250,000
Source: Appraisal Report by T.A. Management Corporation (1999) Co., Ltd (reference number TA-11-3047 / 57)
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Natural Park Public Company Limited
Undeveloped Land
1.
2.
Asset Class
2 plots of vacant Land with a total area of 1-3-68.7 rai (or 768.7 sq.wah)
Asset Location
Wattana District
Obligation
None
Method of Valuation
Market Approach
Valuation Date
November 13, 2014
Appraisal
THB 92,240,000
Forced sale of 65%
THB 59,956,000
Asset Class
Group 1: 5 plots of vacant land with a total area of 3-2-47 rai (or 1,447 sq wah)
Group 2: 9 plots of vacant land with a total area of 3-3-73.8 rai (or 1,573.8 sq.wah)
Group 3: 3 plots of land with a total area of 5-3-02.9 rai (or 2,302.9 sq.wah)
Asset Location
Bangkok Noi Distritct
Obligation
Mortgaged with Seamico Securities (Thailand) PLC.
Method of Valuation
Market Approach
Valuation Date
November 14, 2014
Appraisal
THB 334,125,000
Forced sale of 60%
THB 217,181,000
Source: Appraisal Report by T.A. Management Corporation (1999) Co., Ltd (reference number TA-11-3046/57)
3.2.2.2
Natural Chao Phraya Project Company Limited and
Natural Chao Phraya Hotel Company Limited
Land
1.
Asset Type
1 Plot of land with a total area of 1-1-4 rai (or 504 sq.wah)
Asset Location
Soi Sanphawut 21 (Yek 4), Bangna, Bangna, Bangkok
Owner
Natural Chao Phraya Project Company Limited
Obligation
None
Valuation Approach
Market Approach
Valuation Date
November 14, 2014
Appraised Value
THB 11,088,000
Forced Sale at 50%
THB 5,544,000
Source: Appraisal Report by T.A. Management Corporation (1999) Co., Ltd (reference number TA-11-3049/57)
2.
Asset Type
Group 1: 278 plots of vacant land. Total area of 215-2-17.9 rai (or 86,217.9 sq.wah)
Group 2: 22 plots of vacant land. Total area of 66-1-0 rai (or 26,500 sq.wah)
Group 3: 22 plots of vacant land. Total area of 7-0-2 rai (or 2,802 sq.wah)
Asset Location
Group 1&2: Soi Phetchueng 26, Soi Bang Yo 3, Phetchahueng
Group 3: No direct access, Bang Nam Pheung, Bangkasob, Prapadaeng, Samut prakarn
Obligation
None
Valuation Approach
Market Approach
Valuation Date
November 6, 2014
Appraised Value
THB 1,249,000,000
Forced Sale at 60%
THB
749,400,000
Source: Appraisal Report by T.A. Management Corporation (1999) Co., Ltd (reference number TA-11-3048/57)
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3.2.2.3
Natural Park Public Company Limited
Khon Kaen Buri Company Limited
Building and Land
1.
Asset Type
42 Plots of land. Total area of 12-1-36.9 rai (4,936.9 sq.wah)
and a 12-storey building with two supporting buildings
Asset Location
"Centara Hotel & Convention Centre Khon Kaen"
999 Moo 4 Prachasamosorn, Muang, Khon Kaen Province
Obligation
Mortgaged with Islamic Bank of Thailand
Valuation Approach
Appraised using the Income Approach and
using the Cost Approach for comparison
Valuation Date
November 10, 2014
Appraised Value
THB 1,810,000,000
Forced Sale at 70%
THB 1,267,000,000
3.2.2.4
Boonbaramee Metta Property Company Limited
(Pacific Hotel Chiang Mai Company Limited and
Pacific Chiang Mai Company Limited)
Land and the Anantara Resort and Spa Chiang Mai
1.
Asset Type
Group 1: 4 Plots of land with a total area of 7-0-91 rai (or 2,891 sq.wah)
with a 4-storey building (with a basement) and 6 supporting buildings
Group 2: 3 Plots of land with a total area of 0-0-69.4 (or 69.4 sq.wah) and a
building consisting of 3 units, including a mezzanine level on the 4th floor.
Group 3: 3 Plots of land with a total area 1-0-33 rai (or 433 sq.wah)
Asset Location
Group 1: 123 Hotels Anantara Chiang Mai Resort & Spa Rd., Chiangmai
Group 2: No. 104, 104/1, 144/1 Rama Road, Sridonchai
Group 3: Charoenprathet Road, Sridonchai Chang Klan City, Chiangmai
Obligation
Group 1: Mortgaged with Islamic Bank of Thailand
Group 2-3: None
Valuation Approach
Appraised using the Income Approach and
using the Cost Approach for comparison
Valuation Date
November 4, 2014
Appraised Value
THB 1,455,000,000
Forced Sale at 80%
THB 1,164,000,000
Source: Appraisal Report by T.A. Management Corporation (1999) Co., Ltd (reference number TA-11-3039/57)
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
The appraised value of property compared to book value as per the financial
statements as at September 30, 2014.
(Unit: THB million)
Assets
Book Value
1)The Natural Park Public Company Limited
1.1 Land
1.2 Land held for Development
2) The Natural Chao Phraya Project Company Limited
and Natural Chao Phraya Hotel Company Limited
2.1 Land
Appraised
Value
Increase /
(Decrease)
on Book Value
119.06
374.07
118.85
426.37
(0.21)
52.29
922.81
1,260.09
337.28
3) Khon Kaen Buri Company Limited
3.1 Land and Buildings
2,099.82
1,810.00
(289.82)
4) Boonbaramee Metta Property Company Limited
4.1 Land and Buildings
1,615.61
1,455.00
(160.61)
Total Increase/(Decrease) on Book Value before tax
(+) Deferred Tax arising from asset revaluation (effective rate: 20%)
Total Increase/(Decrease) on Book Value after tax
(61.07)
12.21
(48.85)
Adjustments to the value of NPARK’s Book Value equals to a decrease of THB 48.85
million.
3.2.3 Tax Losses (carried forward for 5 periods)
A copy of NPARK’s tax return (PND 50) indicates that NPARK has filed tax losses
from January 1, 2009 until December 31, 2013 (5 periods) with a total of THB 1,323 million
represented in the latest period. These translate to a deferred tax asset of THB 264.61
million.
The IFA, however, has no proof of whether these taxes losses can be utilized. Due
to the aforementioned uncertainty, the IFA has not taken the benefits from the corporate
income tax losses into account when determining NPARK’s Adjusted Book Value.
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
3.2.4 Commitments and Contingent Liabilities
NPARK had the following commitments and contingent liabilities according to the
notes of the financial statements as at September 30, 2014. The details are summarized in
the table below:
(Unit: THB million)
List
Item 1:
Obligation
Adjustment
(4.46)
(4.46)
(149.96)
(149.96)
Obligations relating to a sale and purchase agreement entered into
regarding land to the value of THB 317.34 million and an interest rate of
7% per annum on the amount of the land (to retain rights of first refusal)
(328.00)**
0.00
Obligations relating to a sale and purchase agreement entered into
regarding land for real estate development (7 contracts)
(2,590.55)
0.00
(354.40)
0.00
(1,471.30)**
0.00
(35.71)**
(35.71)
Leasehold Obligations
(Note* 25.1)
Item 2:
(Note 25.2)
Item 3:
(Note 25.3)
Item 4:
(Note 25.4)
Item 5:
(Note 25.5)
Item 6:
(Note 25.6)
Building design, construction and consulation fees which have been
commited to but not completed or paid
Obligations relating to 3 of NPARK’s subsidiaries with outstanding sale
and purchase agreements entered into regarding the purchase of land
(4 contracts)
6.1 NPARK has committed to paying annual rental and for the right to
manage the construction of a hotel for the next 30 years
6.2 Building design, construction and consulation fees which have
been commited to but not completed or paid
Remark: *Note to the financial statements for the period ended September 30, 2014.
**Estimated by the IFA
Source: The notes to the financial statements for the period ended September 30, 2014 of NPARK
The IFA will only make adjustments for Item 1, 2 and 6.2 as Items 3-5 are contracts
to purchase land, which is a normal transaction, for which NPARK will receive an asset after
the payment is made. For Item 6.1, although NPARK has an obligation contract, there is an
uncertainty on the commencement of the transaction.
Adjustments to the value of NPARK’s Book Value total THB 190.13 million.
3.2.5 Legal Disputes
According to the notes to the financial statements for NPARK as at September 30,
2014, the Company has one outstanding legal dispute:
- On 29 November 2005, the official receiver of a financial institution has notified the
Company to repay the interest of debenture in the amount of Baht 2.31 million as the
ground of debenture. The Company submitted the objection against the official
receiver’s order to the Central Bankruptcy Court. On 25 December 2007, the Central
Bankruptcy Court ordered the dismissal the Company from the debtor’s list of such
financial institution. On 22 February 2008, the official receiver appealed to the order
of the Central Bankruptcy Court and on 2 April 2008, the Company filed a plea. The
case is presently under the consideration of the Supreme Court.
NPARK’s legal council and Board of Directors cannot determine what the result or
time frame of the case will be in the future, the IFA has, therefore, not taken this into account
when calculating the Adjusted Book Value of NPARK.
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
The Adjusted Book Value of NPARK
The IFA has adjusted the Book Value of NPARK to reflect the changes mentioned
above. The results are summarized in a table below:
(Unit: THB million)
The Book Value for NPARK as at September 30, 2014
4,229.41
Adjustments:
3.2.1
An increase in paid-up capital
6,322.32
3.2.2
Revaluation of appraised properties
3.2.3
Tax Losses
3.2.4
Commitments and Contingent Liabilities
3.2.5
Legal Disputes
(48.85)
0.00
(190.13)
0.00
Adjusted Book Value for NPARK as at September 30, 2014
10,312.74
NPARK’s Shareholders’ Equity value, based on the Adjusted Book Value Approach
above, equals to THB 10,312.74 million.
The Adjusted Book Value Approach reflects the net asset value of NPARK better
than the Book Value Approach as the fair value for assets is implemented into the Book
Value figure reported in the financial statements.
Nevertheless, the Park Ramindra Project and Park Aran (Condo & Boulevard)
Project were not taken into consideration for the Adjusted Book Value calculation as the land
for these projects were recently acquired.
3.3
Price-to-Book Value Ratio Approach
Under this approach, the shares are appraised from the NPARK’s Book Value as of
September 30, 2014, derived from Part 4: 3 Section 3.1 (Post rights offering), equal to THB
10,551.73 million multiplied by the median Price-to-Book Value Ratio (P/BV) ratio of peer
companies, which are the entities listed in the Stock Exchange of Thailand (“SET”)’s
Property Development Sector and engaging in the business of condominium and house
construction. The peer companies are selected to include comparables with a total asset
base of THB 5,000 – 15,000 million as at September 30, 2014. There are 14 peer
companies selected for this study (“Peer Group”), the details are reflected below:
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Opinion of the Independent Financial Advisor
Company Name
SET
Ticker
Natural Park Public Company Limited
Type of business
Assets*
Market Cap
(THB million)
(THB million)
1. Areeya Property
PCL
A
Areeya Property Public Company Limited develops
single detached houses in central business district.
Its existing projects are Areeya Chab, Areeya
Sawana, Areeya Chaba Exclusive, Areeya Busaba,
Areeya Casa at Ratchada, Ratchad 2 and
Sukhumvit. The company also provides
management services.
11,133.53
5,390.00
2. AQ Estate PCL
AQ
AQ Estate Public Company Limited and its
subsidiaries develop land and real estate including
single family homes, duplex units, town homes and
condominiums, for residential and commercial use.
The Company, through its subsidiaries, provides
construction services, and owns and operates golf
course.
5,654.49
4,403.50
3. Eastern Star Real
Estate PCL
ESTAR
Eastern Star Real Estate Public Company Limited
develops land and real estate for sale and rental.
The Company also owns and operates golf courses.
6,362.31
5,574.69
4. Golden Land
Property
Development. PCL
GOLD
Golden Land Property Development Public
Company Limited develops real estate properties for
sale and rental. The Company's projects include
townhouses, condominiums, single houses, and
office buildings.
14,896.77
13,513.66
5. Lalin Property PCL
LALIN
Lalin Property Public Company Limited builds singlefamily homes, townhomes, condominiums, as well
as commercial buildings in planned residential
communities. Most of the Company's projects are
located in Bangkok suburbs.
6,942.21
3,729.00
6. Major Development
PCL
MJD
Major Development PCL is a real estate
development company. The Company develops
residential condominiums.
14,227.58
2,839.36
7. MK Real Estate
Devlp. Pub Co
MK
M.K. Real Estate Development Public Company
Limited develops real estate. The Company's main
projects are housing developments ranging from
single family houses to duplex and townhouses.
7,076.80
3,751.27
8. Nusasiri PCL
NUSA
Nusasiri PCL is a property development company.
The Company's projects include residential homes,
condominium's, and retail plaza's.
6,803.34
4,351.82
9. Pace Development
Corp PCL
PACE
PACE Development Corp PCL is a property
development company. The Company develops
high-end properties including mixed use and hotel
properties in Bangkok.
13,430.14
7,436.44
10. Prinsiri PCL
PRIN
Prinsiri PCL develops property, primarily single
family homes and townhouses. The Company's
projects are located in Bangkok, Thailand.
10,355.42
2,208.15
11. Raimon Land
Public Company
Limited
RML
Raimon Land Public Company Limited develops real
estate for sales and rentals including land plots,
single houses, townhouses, condominiums,
commercial buildings, and office buildings. The
Company also provides housing construction, and
management and maintenance services.
11,064.32
7,722.92
12. Singha Estate PCL
S
Singha Estate PCL is a property developer
specializing in residential projects in the Bangkok
area.
6,575.40
48,065.98
13. Siam Future
Development PCL
SF
Siam Future Development Public Company Limited
provides property development and management
services. The Company concentrates on shopping
center projects and provides services in all phases
of development including site selection, estate
development, consultant services, marketing
services, as well as offering co-investment.
12,266.75
10,585.68
14. Sena Development
PCL
SENA
Sena Development PCL develops residential real
estate. The Company constructs single family,
semi-detached, and condominium buildings.
6,184.50
2,229.88
Remark: *Total Asset base as reported on September 30, 2014
Source: Stock Exchange of Thailand
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
The average and median P/BV ratio of the Peer Group in the past 30 days, 90 days,
180 days, 270 days and 360 days up to the cut-off date of October 2, 2014 (the day before
the NPARK Board of Directors meeting No.2/2014) can be concluded as follows:
SET Ticker
Average and Median historical P/BV ratio
30 days
90 days
180 days
270 days
360 days
A
1.90
1.90
1.84
1.79
1.72
AQ
0.69
0.63
0.55
0.55
0.55
ESTAR
1.25
1.16
0.95
0.90
0.91
GOLD
2.03
2.06
1.73
1.62
1.61
LALIN
0.84
0.81
0.75
0.78
0.80
MJD
1.15
1.06
0.88
0.82
0.78
MK
0.70
0.67
0.62
0.60
0.61
NUSA
1.25
1.03
0.90
0.86
0.86
PACE
2.82
2.18
1.72
2.00
NA*
PRINC
0.54
0.53
0.48
0.47
0.49
RML
2.51
2.39
2.25
2.20
2.34
S
6.11
5.03
3.35
2.61
2.18
SF
1.66
1.47
1.38
1.36
1.40
SENA
0.97
0.90
0.82
0.79
0.84
Average (times)
1.74
1.56
1.30
1.24
1.16
Median (times)
1.25
1.11
0.92
0.88
0.86
Remark: *PACE started trading on the stock market on August 7, 2013, which is less than 360 days trading days prior to the
October 2, 2014.
Source:
Bloomberg
The box below contains the calculation formula for share valuation under this approach:
The value of NPARK = Median P/BV ratio of Peer Group × BV of NPARK as at September 30, 2014
The value of NPARK = Median P/BV ratio of Peer Group × Adjusted BV of NPARK
as at September 30, 2014
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Summary of the Company’s valuation by P/BV ratio approach are as follows:
(Unit: THB million)
Past
Period
Median
P/BV of
Peer
Group
(times)
Book value
as of
September
30, 14
Implied
Equity Value
of NPARK
as at
Sep 30, 14
Book value
(Post Rights
Offer) as of
Sep 30, 14
NPARK’s
Implied
Equity
Value
Adj Book
Value of
NPARK as at
Sep 30, 2014
NPARK’s
Implied
Equity
Value
30 days
1.25
4,229.41
5,297.76
10,551.73
13,217.11
10,312.74
12,917.77
90 days
1.11
4,229.41
4,697.27
10,551.73
11,718.97
10,312.74
11,453.55
180 days
0.92
4,229.41
3,909.56
10,551.73
9,753.75
10,312.74
9,532.84
270 days
0.88
4,229.41
3,724.27
10,551.73
9,291.49
10,312.74
9,081.05
360 days
0.86
4,229.41
3,635.15
10,551.73
9,069.15
10,312.74
8,863.75
The Price-to-Book Value Ratio Approach reflects NPARK’s performance and
financial position at 2 October 2014 (the day before the NPARK Board of Directors meeting
No.2/2014) through comparison with the average ratio of the Peer Group, but does not
reflect the present market value of its assets, nor its future profitability.
By this approach, NPARK is valued in a range of THB 3,635.15 – 5,297.76 million
according to the Book Value (Pre right- offering), and THB 9,069.15 – 13,217.11 million
according to the Book Value including the rights offering.
Moreover, the IFA also considered the Price-to-Adjusted Book Value Ratio, which
reflected a shareholders’ equity value of NAPRK in the range of THB 8,863.75 – 12,917.77
million.
3.4
Price-to-Earnings Ratio Approach
The trailing four quarters of NPARK were negative, a Price-to-Earnings ratio is not
appropriate. Therefore, the IFA is unable to value NPARK’s shareholders’ equity based on
this approach.
3.5
Discounted Cash Flow Approach
This valuation approach is based on the NPARK’s future performance. The Company
is appraised by an estimation of the net present value of free cash flow expected from future
operations, according to a financial projection of the Company. The projection is made
under the assumption that the Company continues to operate under the Going Concern
basis without any material change taking place, and also based on the economic
environment and present circumstances where the business operation is under oversight of
the current management team, not taking into account any change in business plan or other
attribute that might be determined by the Company in the future.
The financial projection and assumptions are prepared by the IFA with an estimation
of cash flow made based on the management’s forecast on future performance from the
Company’s income generating segments:
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
The IFA is of the opinion that a sum-of-the-part valuation will best capture the value
of NPARK. Below is a flowchart detailing the different parts of business to be included in the
valuation under DCF method:
The Natural Park Public Company Limited
100%
A1: The Natural
Park Apartment
Project
A2: Other Projects
100%
B: Khon Kaen Buri
Company Limited
C: Boonbaramee Metta
Property Company
Limited
B1: Centara
Hotel and
Convention
Centre
C1: Anantara
Chiang Mai
Resort and Spa
The Natural Park Public Company Limited (“NPARK”)
The following projects have been evaluated by the IFA in order to determine a fair
value for the Company.
A1:
A2:
The Natural Park Apartment Project (NPARK-APT)
Other Projects
The key assumptions used for the financial projection are as follows:
A1. The Natural Park Apartment Project (NPARK-APT)
Project Details:
Project Name
The Natural Park Apartment Project (NPARK-APT)
Project Location
88 Soi Sukhumvit 49, Wattana, Bangkok
Category
Apartment for rent
Number of Units
81 units in three 15-storey residential buildings
Average
Occupancy Rate
Average Occupancy rate for the 2013 fiscal year was 84%
Current Status
In operation
Room Types
There are 3 room-type:
1) 69 standard units with 3 bedrooms, 3 bathrooms, kitchen, maid’s room, working/reading
room, dining room and a spacious living room including a counter bar. Each unit has an
area of ~ 250 sq.m.
2) 6 Duplex units with 3 bedrooms with en-suite bathrooms, kitchen, maid’s room, dining
room, a spacious living room and a balcony with a panoramic view of the surroundings.
Each unit has an area of ~ 340 sq.m.
3) 6 Penthouse units with 4 bedrooms with en suite bathrooms and an area of ~400 sq.m.
Source:
NPARK
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Natural Park Public Company Limited
NPARK-APT has both direct and agency sales distribution channels. The average
rental rate is dependent on the signed contracts with individual tenants.
NPARK has the leasehold rights to the land and buildings of the Natural Park
Apartment Project (NPARK-APT), as per a leasehold agreement with an unrelated third
party. The leasehold agreement expires in 2018 and the IFA cannot predict with certainty
whether or not the leasehold agreement will be renewed. NPARK-APT has, therefore, been
valued until the lease expires in February 2018, under the assumption that the leasehold
agreement will not be renewed.
Revenue from Services
Revenue from Rental Income and Other Income have been summarized below
ƒ
Rental Income
Rental Income is a function of the tenant occupancy rate and the average monthly
rental rate (as per individual lease agreements).
The occupancy rate in 2011-2014 (9 months) was 55%, 69.1%, 84% and 85.2%,
respectively. The strong growth in occupancy is a sign that management’s “Development
and Management for Sustainable Profit“strategy has had a positive impact on the business.
Based on the operating results for 2014 and the historical growth in the occupancy rate, the
IFA projects that average occupancy rate will be 85% for the remainder of 2014 (3 months)
and onwards until 2018.
Average monthly rental revenue per unit increased 7.62% from 2013 – 2014
(9 months), the IFA anticipates that the figure will grow at the same rate for the projected
period. The IFA expects that no further units will be added to The Natural Park Apartment.
Projected Rental Revenue for 2014-2018:
2012
2013
2014
2015
Actual
Occupancy Rate (%)
Apartment Units Available (annual)
2016
2017
2018
Projected
69.1%
84.0%
85.1%
85.0%
85.0%
85.0%
85.0%
972
972
972
972
972
972
162
Apartment Units Occupied (annual)
672
816
828
826
826
826
138
Avg. Monthly Rental per unit (THB)
100,942
103,540
111,426
119,914
129,047
138,877
149,455
NA
2.57%
7.62%
7.62%
7.62%
7.62%
7.62%
67.83
84.49
92.21
99.07
106.62
114.74
20.58
Growth Rate (%)
Rental Revenue (THB million)
Source:
ƒ
NPARK & IVG Estimates
Other income
Other Income was 6.7%, 6.2% and 6.6% of Rental Revenue in 2012 – 2014(9
months), respectively, representing an average of 6.5%. Based on this, the IFA projected
Other Income to be 6.5% of Rental Revenue for the projected period.
Projected Other Income for 2014-2018:
2012
2013
2014
2015
Actual
Total Other Income (THB million)
Other Income as a % of Rental Revenue (%)
Source:
2016
2017
2018
Projected
4.54
5.24
5.99
6.44
6.93
7.46
1.34
6.7%
6.2%
6.5%
6.5%
6.5%
6.5%
6.5%
NPARK & IVG Estimates
I V Global Securities Public Company Limited
Part 4
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Costs
ƒ
Operating Costs
Operating Costs comprise of fixed and variable components as defined by
management.
Fixed Costs include salaries, staff benefits, cleaning services and subscriptions etc.
In 2012-2014(9 months) Fixed Costs totaled THB 14.96 million, THB 16.46 million and THB
11.79 million or 20.6%, 18.3% and 16.0% of Total Revenue, respectively, representing an
average of 18.3% of Total Revenue for the period. Under management’s initiatives of
“Development and Management for Sustainable Profit“ and the trend in 2014 to date, the IFA
anticipates the cost will drop to 17.5% of Total Revenue for 2014 (3 months) and onwards.
Variable Costs include utilities, promotional expenses and sales commissions etc. In
2012-2014(9 months) Variable Costs totaled THB 11.58 million, 14.36 million and THB 11.79
million or 16.0%, 16.0% and 16.0% of Total Revenue, respectively, representing an average
of 16.0% for the period. Under management’s initiatives of “Development and Management
for Sustainable Profit“ and the trend in 2014 to date, the IFA anticipates the cost will remain
at 16% of Total Revenue for 2014 (3 months) and onwards.
Projected Operating Costs for 2014-2018
2012
2013
2014
2015
Actual
Fixed Costs (THB million)
As a % of Total Revenue (%)
2016
2017
2018
Projected
14.94
16.46
16.08
18.46
19.87
21.38
3.84
20.6%
18.3%
16.4%
17.5%
17.5%
17.5%
17.5%
Variable Costs (THB million)
11.58
14.36
15.71
16.88
18.17
19.55
3.51
As a % of Total Revenue (%)
16.0%
16.0%
16.0%
16.0%
16.0%
16.0%
16.0%
Fixed & Variable Costs (THB million)
As a % of Total Revenue (%)
Source:
ƒ
26.52
30.81
31.79
35.35
38.04
40.94
7.34
36.6%
34.3%
32.4%
33.5%
33.5%
33.5%
33.5%
NPARK & IVG Estimates
Other Costs
Other Costs refer to the cost of land rental, insurance and property tax. Historically,
these costs have consumed approximately 6.5%, 5.3% and 6.7% of Total Revenue or
THB 4.72 million, THB 4.76 million, THB 6.57 million in 2012–2014 (9 months), respectively,
representing an average of 6.2% over the period. The IFA projects that Other Costs will be
equal to 6.2% of Total Revenue for 2014 (3 months) and the remainder of the projected
period.
Projected Other Costs for 2014-2018:
2012
2013
2014
2015
Actual
2016
2017
2018
Projected
Other Costs (THB million)
4.72
4.76
6.57
6.54
7.04
7.58
1.36
As a % of Rental Revenue
6.5%
5.3%
6.7%
6.2%
6.2%
6.2%
6.2%
Source:
NPARK & IVG Estimates
Working Capital
The IFA projects that working capital ratios will be fixed throughout the projected
period based on the historical working capital ratios, payment conditions under the related
agreements and industry norms. Details are as follows:
Current Assets & Current Liabilities
Average Collection period:
Average Payment period:
I V Global Securities Public Company Limited
20 Days
30 Days
Part 4
Page 50
Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Capital Expenditure
The Natural Park Apartment Project has an allocated furniture, fittings and equipment
(FF&E) reserve where a portion of revenue is allocated to cover renewal, replacement,
additions and routine capital expenditure. Historically, NPARK’s allocation has been volatile,
however, due to the fact that the lease will expire in 2018, the IFA anticipates the reserve
allocation will settle at 2% of Total Revenue for the projected period.
Projected Capital Expenditure for 2014-2018:
2012
2013
2014
2015
Actual
Capital Expenditure (THB million)
As a % of Total Revenues (%)
Source:
2016
2017
2018
Projected
15.0
6.31
4.12
2.11
2.27
2.44
0.44
20.7%
7.0%
4.2%
2.0%
2.0%
2.0%
2.0%
NPARK & IVG Estimates
Corporate Income Tax
Corporate income tax for 2014-2018 is estimated at 20% of pre-tax profit. NPARK is
currently carrying a large tax loss that is usable for the next 5 periods and is, therefore, not
expected to incur a tax expense in the projected period.
Terminal Value and Discount Rate
The Company retains the right to lease the units in the apartment building (“NPARKAPT”) based on a leasehold agreement with a non-related third entity. The leasehold
agreement expires in February 2018 and the IFA, therefore, cannot prudently make an
assumption on the future of The Natural Apartment Project after that date. The value of the
project has been calculated under the assumption that the leasehold agreement will not be
renewed after 2018. Hence, there is no Terminal Value for this case.
Based on the above assumptions for the financial projection, the IFA has projected
the future cash flows from the project operations. In order to identify the value of the project,
an estimation of the net present value of future cash flows arising from the projection has
been generated using a weighted average cost of capital (WACC) equal to 14.58%, as a
discount rate. WACC is calculated using the following formula:
WACC Calculation:
14.58%
WACC
=
Ke(E/V) + Kd(1-t)(D/V)
Ke*
=
Cost of Equity (Calculated below)
14.58%
Kd
=
Cost of Debt - Average at September 30, 2014
7.75%
t
=
Corporate Tax Rate
20%
E
=
Total shareholders’ equity at September 30, 2014
(THB 5,155.8 million)
D
=
Interest Bearing Debt at September 30, 2014
(THB 24.3 million)
V
=
E +D
(THB 5,180.1 million)
E/V
=
99.5%
D/V
=
0.5%
*Calculation of Ke:
Ke
=
Rf + β(Rm-Rf)
where:
I V Global Securities Public Company Limited
Part 4
Page 51
Opinion of the Independent Financial Advisor
Risk Free Rate (Rf)
=
Beta (β)
=
Rm
=
Natural Park Public Company Limited
Risk free rate of return is 3.63%, which is based on the 3-year daily average of
Thailand’s risk-free rate, as define by Bloomberg.
(The rate is based on the 10-year Thai government bond yield).
A variance between market return and closing market price of NPARK’s shares.
Since NPARK is listed, IFA took the most recent beta score reflected by Bloomberg.
The difference between the expected rate of return and the risk free rate of return as
at October2, 2014, equivalent to 10.33%.
Considering the aforementioned assumptions, the IFA arrived at the project value of
THB 178.62 million as shown in the table below:
Table: DCF of NPARK-APT based on projected income and balance sheets as at 2 October 2014:
(Unit: THB million)
2557
(3 months)
2558
2559
2560
2562
Year 0
Year 1
Year 2
Year 3
Year 4
Total Revenue
24.5
105.5
113.5
122.2
21.92
(9.52)
(41.9)
(45.1)
(48.5)
(8.70)
15.0
63.6
68.5
73.7
13.2
-
-
-
-
-
(+) Depreciation
0.75
3.00
3.00
3.00
3.00
(-) Net change in Working Capital
0.76
(1.29)
(0.16)
(0.17)
1.95
(0.49)
(2.11)
(2.27)
(2.44)
(0.44)
Total Cash Flow
16.0
63.2
69.0
74.1
17.7
Present Value of Cash Flow
15.5
53.3
50.8
47.6
11.39
Total Cost
EBIT
(-) Income Tax
(-) Capital Expenditure
Net Present Value of NPARK-APT
178.62
The IFA has performed a sensitivity analysis to assess the effects of a change in the
occupancy rate and average room rate growth for NPARK-APT.
The results are
summarized below:
Occupancy Rate (%)
Growth in Average Room
Rate (%)
(Unit: THB million)
65%
70%
75%
80%
85%
90%
95%
3.0%
129.22
138.26
147.31
156.36
165.41
174.46
183.51
4.0%
131.35
140.56
149.77
158.99
168.20
177.41
186.62
5.0%
133.51
142.89
152.27
161.65
171.03
180.41
189.79
7.6%
139.32
149.14
158.97
168.79
178.62
188.44
198.27
9.0%
142.47
152.54
162.61
172.67
182.74
192.81
202.88
10.0%
144.79
155.03
165.28
175.53
185.77
196.02
206.26
11.0%
147.14
157.56
167.99
178.42
188.84
199.27
209.70
The sensitivity analysis above indicates that NPARK-APT has a value in the
range of THB 161.65 – 192.81 million
I V Global Securities Public Company Limited
Part 4
Page 52
Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
A2: Other Projects
NPARK, following in the direction that was set out in the 2013 Annual report, has
initiated land development projects, which are expected to generate cash inflows in the
foreseeable future. The IFA has only considered projects that have been launched or have
been allocated to land banks that are owned by the Company. The projects include: (1)
Park Ramindra, (2) Park Aran (Condo & Boulevard), (3) Park Charan, (4) Park Aran Market
and (5) Project Bangkrachao. The present values of expected future cash flows of these
projects have been summarized in a table below.
The present value of future cashflows expected from the projects is summarized in
the table below.
Estimated future cash flows of other projects:
2014
Other Projects
(Unit: THB millions)
Total Income
2015
2016
2017
2018
2019
Year 1
Year 2
Year 3
Year 4
Year 5
(6 months)
Year 0
307.18
1,211.07
962.55
525.41
620.44
285.71
Total Costs
(464.29)
(697.53)
(258.83)
(251.32)
(189.86)
(109.68)
Gross Profit
(157.11)
513.54
703.72
274.09
430.58
176.03
(-) Income Tax
-
4.78
4.91
5.58
5.67
5.71
(+) Depreciation
-
(109.41)
(140.74)
(54.82)
(86.12)
(35.21)
(621.06)
(4.78)
(4.91)
(5.58)
(5.67)
(5.71)
Free cash flow
(778.17)
404.14
562.98
219.27
344.46
140.82
Present value of future cash flows
(752.14)
340.91
414.47
140.89
193.16
824.28
Present value of the projects
1,161.58
(-) Provision for certain projects
(922.80)
(-) Capital Expenditure CAPEX)
Equity Value of Other Projects
238.77
In addition, the IFA performed a sensitivity analysis on the total equity value of Other
Projects to assess the effects of a change in the discount rate (WACC) from 12.5 - 17.5%
and terminal growth rate from 3 - 7%.
The sensitivity analysis indicates that Other Projects have a total equity value in the
range of THB (184.17) - 1,050.10 million
I V Global Securities Public Company Limited
Part 4
Page 53
Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
B.
Khon Kaen Buri Company Limited (“KK”)
B.1
Centara Hotel and Convention Centre
Project Details:
Project
Centara Hotel & Convention Centre Khon Kaen
Project Location
999, Moo 4, Prachasamosorn Road, Nai Muang Sub-District, Muang District, Khon Kaen
40000 (next to Khon Kaen Provincial Government Centre)
Hotel Style
Hotel and Conference / Seminar / Catering / 4-Star (Hotel & Convention Centre)
Number of
Rooms
Facilities
196 Rooms (Comprising of: 155 Superior suites, 28 Deluxe rooms, 28 Junior suites,
10 exclusive access Executive suites and 2 Royal suites (2 rooms and 1 room)
A function area of ~ 4,000 sq.m.
1) Convention Hall that can accomodate over 2,250 people in a theatre style seating
arrangement with a total area of 2,000 sq.m. The facility can be partitioned into 3
smaller areas including a Pre-function area of 465 sq.m.
2) “Prachasamosorn Ballroom” has the capacity for 740 people in a theatre style seating
arrangement and 370 people in a banquet style arrangement
3) “Ratchaphreuk Meeting Rooms 1-6” offer capacity ranging from 200 people in a
theatre style seating arrangement to 70 people in a banquet style arrangement.
Current Status
Fully operational since December 7, 2014
Occupancy Rate
The occupancy rate was 42.2% from January – December 2013
Source:
NPARK
The key assumptions used for the financial projection are as follows:
Hotel Revenue
Revenues from hotel operation consist of Room Revenues, Food and Beverage
Revenues and Other Revenues.
ƒ
Room Revenues
Room Revenues for 2013 totaled THB 39.91 million. In 2014, Room Revenues have
reached THB 32.46 million with peak season still to be recorded.
KK has no plan of increasing the number of rooms in the foreseeable future.
ƒ
Occupancy Rate
The average occupancy rate in 2012-2014(8 months) was 38.5%, 42.2% and 50.2%
respectively. The peak season for 2014 was not reflected in this figure. Management
anticipates the rate will stabilize to 75% in the near future. The IFA, therefore, expects the
average occupancy rate for 2014 to level off at 55.0% by year end. I n 2015 and 2016, the
rates are projected to 62.5% and 70.0%, respectively, before settling on 75.0% from 2018
onwards
ƒ
Average Room Rate (ARR) per night
The average room rate in 2013 stood at THB 1,334, representing a 10.5 % increase
from the previous period. For 2014(8 months), the ARR of THB 1,367, is projected to grow
to THB 1,467, a 10% increase from the 2013 figure, in line with management expectations.
For 2015 and onwards the ARR is projected to increase by 10% per annum in line with the
current trend.
I V Global Securities Public Company Limited
Part 4
Page 54
Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Projected Room Revenues for 2014-2019:
2012
2013
2014
2015
Actual
2016
2017
2018
2019
Projected
No. of rooms available (annual)
35,672
71,540
71,540
71,540
71,736
71,540
71,540
71,540
Number of rooms sold (annual)
13,734
30,190
36,779
45,070
50,215
53,655
53,655
53,655
Occupancy Rate (%)
38.5%
42.2%
51.4%
63.0%
70.0%
75.0%
75.0%
75.0%
Average Room Rate (THB)
Growth in Average Room Rate (%)
Total Room Revenues (THB million)
Source:
1,207
1,334
1,467
1,614
1,776
1,953
2,148
2,363
NA
10.5%
10.0%
10.0%
10.0%
10.0%
10.0%
10.0%
18.89
39.91
51.07
72.75
89.16
104.79
115.27
126.80
NPARK & IVG Estimates
Remark: NA (Non-Applicable): Data point not available
ƒ
Food and Beverage Revenues
In 2012-2014(8 months), Food and Beverage Revenues were THB 47.48 million,
THB 83,85 million and THB 65.94 million, equivalent to 251.3%, 210.1% and 203.2% of
Room Revenues, respectively, representing an average of 221.5% of Room Revenues over
this period. The IFA expects Food and Beverage revenues to stabilize at 230% of Room
Revenues for 2014 (4 months) onwards as the hotel starts operating more sustainably and
the convention centre operations grow.
ƒ
Other Revenue
Other Revenue includes revenues from auxiliary services such as telephone service,
laundry service etc. In 2012-2014(8 months), Other Revenue amounted to THB 0.43 million,
THB 1,07 million and THB 1.01 million, or 2.3%, 2.7% and 3.43% of Room Revenues,
respectively, representing an average of 2.8%. The IFA anticipates Other Revenue will
grow, as the hotel and convention centre operations stabilize, and settle on 5% of Room
Revenues for 2014 (8 months) onwards.
Projected Food and Beverage Revenues and Other Revenue for 2014 – 2019:
2012
2013
2014
2015
Actual
Food & Beverage Revenues (THB million)
as a % of Room Revenues (%)
Other Revenue (THB million)
As a % of Room Revenues (%)
Source:
2016
2017
2018
2019
Projected
47.5
83.8
107.7
167.3
205.1
241.0
265.1
291.6
251.3%
210.1%
210.8%
230.0%
230.0%
230.0%
230.0%
230.0%
0.43
1.07
1.98
3.64
4.46
5.24
5.76
6.34
2.3%
2.7%
3.9%
5.0%
5.0%
5.0%
5.0%
5.0%
NPARK & IVG Estimates
Costs
ƒ
Cost of Sales/Services
Cost of Sales/Services is mainly composed of room and convention center related
expenses, but do not include personnel expenses.
Cost of Sales/Services in 2012-2014(8 months) totaled THB 15.85 million, THB 26,71
million and THB 22.15 million or 23.7%, 21.4% and 22.3% of Total Revenue, respectively,
representing an average of 22.5% over the period. The IFA anticipates Cost of
Sales/Services will settle on 22% of Total Revenue for 2014 (4 months), 21% for 2015-2016,
20% for 2017-2018 and 19% from 2019 onwards. The reduced rate is achieved because the
hotel is expected to enjoy improved cost efficiency over time.
I V Global Securities Public Company Limited
Part 4
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Projected Cost of Sales/Services for 2014 – 2019:
2012
2013
2014
2015
2016
Actual
Cost of Sales/Services (THB million)
Cost of Sales/Services as a % of Total Revenue (%)
Source:
ƒ
2017
2018
2019
Projected
15.85
26.71
35.64
51.18
62.72
70.21
77.23
80.71
23.7%
21.4%
22.2%
21.0%
21.0%
20.0%
20.0%
19.0%
NPARK & IVG Estimates
Cost of Staff
Costs of Staff covers the personnel cost of all aspects of the Centara Hotel and
Convention Centre.
Cost of Staff in 2013 was THB 55.15 million. According to the information from
management, 2014 Cost of Staff is anticipated to be THB 61,67 million. Cost of Staff is
projected to grow at 5% from 2015 onwards, based on the average increase in salaries and
wages as per industry practices.
Projected Cost of Staff for 2014 – 2019:
2012
2013
2014
2015
Actual
Cost of Staff (THB million)
Growth Rate (%)
Source:
2016
2017
2018
2019
Projected
28.62
55.15
61.67
64.75
67.99
71.39
74.96
78.70
NA
92.7%
11.8%
5.0%
5.0%
5.0%
5.0%
5.0%
NPARK, IVG Estimates
Remark: NA (Non-Applicable): Data point not available
ƒ
Other Expenses
Other Expenses include items such as hotel management, telephone, laundry and
boutique shop and costs of guests’ activities.
Other Expenses for 2012-2014(8 months) totaled THB 25.14 million, THB 50.52
million and THB 39.86 million or 37.6%, 40.5% and 40.1% of Total Revenue, respectively,
representing an average of 39.4%. Based on the information received from management,
the IFA anticipates that the Centara Hotel and Convention Centre will be administered more
efficiently going forward, resulting in Other Expenses decreasing as a percentage of Total
Revenue. The rates expected for Other Expenses are 40.2% of Total Revenue for 2014(4
months), 37.2%, 34.2% and 31.2% for 2015-2017, before settling on 28.2% for 2018
onwards.
Projected Other Expenses for 2014 - 2019:
2012
2013
2014
2015
Actual
Other Expenses (THB million)
Other Expenses as a % of Total Revenue (%)
Source:
ƒ
2016
2017
2018
2019
Projected
25.14
50.52
64.44
90.66
102.15
109.53
108.90
119.79
37.6%
40.5%
40.1%
37.2%
34.2%
31.2%
28.2%
28.2%
NPARK, IVG Estimates
Non-Distributable Expenses
Non-Distributable Expenses include expenses that are not incurred operationally but
are required for the operation of the hotel; this expense consists mainly of insurance and
building tax. IFA has forecast this expense at a rate of 2% of Total Revenue for the projected
period.
I V Global Securities Public Company Limited
Part 4
Page 56
Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Projected Non-Distributable Expenses for 2014 – 2019:
2012
2013
2014
2015
2016
Actual
2017
2018
2019
Projected
Non-Distributable Expenses (THB million)
NA
NA
0.98
4.87
5.97
7.02
7.72
8.50
as a % of Total Revenues (%)
NA
NA
2.0%
2.0%
2.0%
2.0%
2.0%
2.0%
Source:
IVG Estimates
Working Capital
Average collection period and average payment period are projected based on
historical data, KK’s working capital management policy and industry norms.
Turnover of current assets and current liabilities
Average collection period:
20 days
Average payment period:
30 days
Capital Expenditure
Khon Kaen Buri Co., Ltd allocates 2% of Total Revenue towards the Furniture,
fittings and equipment (FF&E) reserve, regardless of use in the period. This reserve is used
for maintenance, repair or replacement of damaged assets and routine capital expenditure.
Projected Capital Expenditure for 2014 – 2019:
2014
2015
2016
0.98
4.87
5.97
2.0%
2.0%
2.0%
2017
2018
2019
7.02
7.72
8.50
2.0%
2.0%
2.0%
Projected
Capital Expenditure (THB million)
Capital Expenditure as a percentage of Total Revenue (%)
Source:
IVG Estimates
Income Tax
Corporate income tax for 2014-2019 is estimated at 20% of pre-tax profit. Khon
Kaen Buri Co., Ltd is currently carrying a large tax loss and is not expected to incur a tax
expense in the projected period.
Terminal Value
The IFA assumes a terminal growth rate of 4.5% per year. According to data
released from the World Travel & Tourism Council, travel and tourism spending growth is
expected to average 5.9% between 2014-2024. The IFA conservatively applies a growth
rate of 4.5% for the terminal period.
Based on the above assumptions for financial projection, the IFA has estimated
future cash flows from the project operations. To identify the value of the project, an
estimation of the net present value of future cash flows to the firm is made. The IFA uses a
weighted average cost of capital, (WACC), equal to 15%, as a discount rate. The WACC rate
of 15% was selected based on the industry standard for unlisted firms.
From the above assumptions, the IFA arrived at a project value of THB 577.43 million
as shown in the table below:
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Table: Calculation of KK’s Centara Hotel and Convention Centre Khon Kaen value based on the DCF Approach
(Unit: THB million)
2014
(3 months)
Year 0
2015
2016
2017
2018
2019
Year 1
Year 2
Year 3
Year 4
Year 5
48.75
243.71
298.69
351.06
386.17
424.78
(51.58)
(211.46)
(238.83)
(258.15)
(268.81)
(287.70)
(2.82)
32.25
59.85
92.91
117.36
137.09
-
-
-
-
-
-
18.75
75.00
75.00
75.00
75.00
75.00
1.05
(0.74)
(0.61)
(1.14)
(0.95)
(0.46)
(-) Capital Expenditure
(0.98)
(4.87)
(5.97)
(7.02)
(7.72)
(8.50)
Project Cash Flows
16.00
101.63
128.26
159.75
183.68
203.13
Total Revenue
Total Cost
EBIT
(-) Income Tax
(+) Depreciation
(-) Change in Net Working Capital
Terminal Value
2,021.66
Project Cash Flows + Terminal Value
16.00
101.63
128.26
159.75
183.68
2,224.79
Present Value of Future Cash Flows
15.45
85.34
93.66
101.43
101.41
1,068.13
Net Present Value of the Project
1,465.43
18.00
(+) Cash
(-) Interest-bearing Debt
(906.00)
Total Equity of the hotel
577.43
The IFA performed a scenario analysis whereby the forced sale value of the Centara
Hotel and Convention Centre Khon Kaen of THB 1,267 million is inflated by 5% per annum
until the terminal year, 2019, and substituted in for the Terminal Value. The forced sale
value in 2019 is equal to THB 1,617.05 million. The result is summarized in the table below:
(Unit: THB million)
(Scenario Analysis)
2014
(3 months)
2015
2016
2017
2018
2019
Year 0
Year 1
Year 2
Year 3
Year 4
Year 5
Forced Sale Value
1,617.05
Cash Flows + Forced Sale Value
16.00
101.63
128.26
159.75
183.68
1,820.18
Present Value of Cash Flows
15.45
85.34
93.66
101.43
101.41
873.88
Net Present Value of the Project
(+) Cash
(-) Interest-bearing Debt
Total Equity of the hotel
1,271.18
18.00
(906.00)
383.13
According to the Scenario Analysis for the Centara Hotel and Convention Centre
Khon Kaen has an equity value of THB 383.13 million.
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Natural Park Public Company Limited
In addition, the IFA performed a Sensitivity Analysis tests on the estimated equity
value of the Centara Hotel and Convention Centre to account for a range of effects that
could arise from a change in the key value drivers. Two cases are summarized below:
Case 1: The effect of a change in the Terminal Growth Rate and WACC in the range of
2.0 – 6.0% and 12.5 – 17.5%, respectively.
Unit: THB million
2.0%
Terminal Growth Rate (%)
3.0%
4.5%
5.0%
6.0%
WACC (%) 17.5%
147.19
192.74
274.19
305.68
376.89
17.0%
186.02
235.65
324.99
359.73
438.70
16.0%
272.22
331.62
440.08
482.81
581.08
15.0%
372.02
443.91
577.43
630.84
755.45
14.0%
488.84
577.02
744.09
812.16
973.82
13.0%
627.34
737.19
950.43
1,039.28
1,255.06
12.5%
706.66
830.11
1,073.14
1,175.75
1,428.34
The sensitivity analysis testing the effects from a change in Terminal Growth Rate
and WACC indicates that the equity value of the Centara Hotel and Convention Centre Khon
Kaen falls in the range of THB 331.62 – 812.16 million
Case 2: The effects of a change in the Occupancy Rate and the growth in ARR. The results
are summarized below:
Growth in Average Room
Rate (%)
Unit: THB million
Occupancy Rate (%)
60%
65%
70%
75%
50%
55%
80%
85%
8.0%
37.83
108.99
180.16
251.33
322.49
393.66
464.83
535.99
9.0%
80.89
156.36
231.83
307.31
382.78
458.25
533.73
609.20
10.0%
125.88
205.86
285.83
365.80
445.77
525.75
605.72
685.69
11.5%
172.88
257.55
342.22
426.89
511.57
596.24
680.91
765.58
12.0%
221.94
311.52
401.10
490.68
580.26
669.84
759.42
848.99
13.0%
273.15
367.85
462.55
557.25
651.95
746.65
841.35
936.05
14.0%
326.58
426.62
526.66
626.70
726.74
826.78
926.83
1,026.87
The sensitivity analysis testing the effects from a change in the Occupancy Rate and
the growth in ARR indicates the equity value of the Centara Hotel and Convention Centre
Khon Kaen falls in the range of THB 205.86 – 759.42 million
According to the Scenario Analysis and both Sensitivity Analysis cases, the IFA
concludes that the equity value of the Centara Hotel and Convention Centre Khon Kaen lies
in the range of THB 205.86 – 812.16 million.
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
C. Boonbaramee Metta Property Company Limited (“BBM”)
BBM has invested into a property development company and a hotel company.
Details below:
1. Pacific Hotel Chiang Mai Co., Ltd operates a hotel under the name, the
“Anantara Resort & Spa Chiang Mai”.
2. Pacific Chiang Mai Co., Ltd is in the business of leasing land and buildings,
specifically to Pacific Hotel Chiang Mai Co., Ltd.
The value of the Anantara Resort & Spa Chiang Mai is considered a proxy for the
value of Boonbaramee Metta Property Company Limited.
The key assumptions used for the financial projection are as follows:
C.1 Anantara Chiang Mai Resort and Spa
Project Details
Project
Project Location
Hotel Style
Number of Rooms
Current Status
Average Occupancy Rate
Source:
Anantara Resort and Spa Chiang Mai
123-123/1 Charoenprathet, Chang Klan City, Chiang Mai
Hotels and Spas
84 Rooms
Operating
The average occupancy rate for 2013 was 76.1%
NPARK
Hotel Revenue
Revenues from hotel operation consist of Room Revenues, Food and Beverage
Revenues and Other Revenues.
ƒ
Room Revenues
Room Revenues for 2013 totaled at THB 148.19 million. In 2014(8 months), Room
Revenues have reached THB 98.02 million with peak season still to be recorded.
Boonbaramee Metta Property Co., Ltd doesn’t plan to increase the number of rooms
in the hotel in the foreseeable future.
ƒ
Occupancy Rate
The average occupancy rate for 2012-2014 (8 months) was 69.5%, 76.1% and
74.6% respectively. The peak season for 2014 isn’t included in this figure. Management
anticipates the rate will stabilize 85% in the future. The IFA, therefore, expects the average
occupancy rate for 2014 (4 months) to level off to 75.0%. In 2015 and 2016, the rates are
anticipated to rise to 82% and 85.0%, respectively, and remain on 85% for the rest of the
projected period.
ƒ
Average Room Rate (ARR) per night
The average room rate stood at THB 6,349 and THB 6,435 for 2013 and 2014 (8
months), respectively. Management expects the ARR will rise to THB 7,080 by the end of
2014. Going forward, the ARR is projected to grow at 11.5% per annum for the projected
period.
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Natural Park Public Company Limited
Projected Room Revenues for 2014 – 2019:
2012
2013
2014
2015
Actual
2016
2017
2018
2019
Projected
No. of rooms available (annual)
30,744
30,660
30,660
30,660
30,744
30,660
30,660
30,660
Number of rooms sold (annual)
21,367
23,332
22,903
25,141
26,132
26,061
26,061
26,061
Occupancy Rate (%)
69.5%
76.1%
74.7%
82.0%
85.0%
85.0%
85.0%
85.0%
5,574
6,349
7,080
7,894
8,802
9,814
10,942
12,201
Average Room Rate (THB)
Growth in Average Room Rate (%)
Total Room Revenues (THB million)
Source:
ƒ
NA
13.9%
11.5%
11.5%
11.5%
11.5%
11.5%
11.5%
119.10
148.15
151.27
198.46
230.00
255.75
285.17
317.96
NPARK, IVG Estimates
NA (Non-Applicable): Data point not available
Food and Beverage Revenues
In 2012-2014 (8 months), Food and Beverage Revenues were THB 51.60 million,
THB 57.10, THB 33.50 million, or 43.3%, 38.5% and 34.2% of Room Revenues,
respectively, representing an average of 38.7% of Room Revenues. The IFA expects Food
and Beverage revenues to stabilize at 41% of Room Revenues for 2014 (4 months) onwards
as the hotel starts operating more stably and sustainably.
ƒ
Other Revenue
Other Revenue includes revenues from auxiliary services such as telephone service,
laundry service etc. In 2012-2014(8 months), Other Revenue amounted to THB 17.20
million, THB 17.50 million and THB 10.90 million, or 14.5%, 11.8% and 11.6% of Room
Revenues, respectively, representing an average of 12.5%. The IFA anticipates Other
Revenue will grow, as the hotel’s operations mature, to 13% of Room Revenue in 2015-2016
and 15% from 2017 onwards.
Projected Food and Beverage Revenue and Other Revenue for 2014 - 2019:
2012
2013
2014
2015
Actual
Food & Beverage Revenues (THB million)
As a % of Room Revenues (%)
Other Revenue (THB million)
As a % of Room Revenues (%)
Source:
2016
2017
2018
2019
Projected
51.60
57.10
54.51
81.37
94.30
104.86
116.92
130.36
43.3%
38.5%
36.0%
41.0%
41.0%
41.0%
41.0%
41.0%
17.20
17.50
17.60
25.80
29.90
38.36
42.77
47.69
14.5%
11.8%
11.6%
13.0%
13.0%
15.0%
15.0%
15.0%
NPARK, IVG Estimates
Costs
ƒ
Cost of Sales/Services
Cost of Sales/Services are mainly composed of room and spa related expenses, but
do not include personnel expenses.
Cost of Sales/Services in 2012-2014(8 months) totaled THB 18.10 million, THB 18,39
million and THB 11.20 million or 9.6%, 8.3% and 7.9% of Total Revenue, respectively,
representing an average of 8.6%. The IFA conservatively estimates that Cost of
Sales/Services will remain at 9% of Total Revenue during the projected period.
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Natural Park Public Company Limited
Projected Cost of Sales/Services for 2014 – 2019:
2012
2013
2014
2015
2016
Actual
2017
2018
2019
Projected
Cost of Sales/Services (THB million)
18.10
18.40
18.29
27.51
31.88
35.91
40.04
44.64
Cost of Sales/Services as a % of Total Revenue (%)
9.6%
8.3%
8.2%
9.0%
9.0%
9.0%
9.0%
9.0%
Source:
ƒ
NPARK, IVG Estimates
Cost of Staff
Cost of Staff covers the personnel cost of all aspects of the Anantara Chiang Mai
Resort and Spa.
Cost of Staff in 2013 was THB 31.70 million. According to the information received
from management, 2014 Cost of Staff is anticipated to be THB 50.39 million. Cost of Staff is
projected to grow at 5% from 2015 onwards, based on the average increase in salaries and
wages as per industry practices.
Projected Cost of Staff for 2014 – 2019:
2012
2013
2014
2015
Actual
Cost of Staff (THB million)
Growth Rate (%)
Source:
ƒ
2016
2017
2018
2019
Projected
29.30
31.70
50.39
52.91
55.55
58.33
61.25
64.31
NA
8.2%
59.0%
5.0%
5.0%
5.0%
5.0%
5.0%
NPARK, IVG Estimates
NA (Non-Applicable): Data point not available
Other Expenses
Other Expenses include costs such as hotel management, telephone, laundry and
boutique shop and costs of guests’ activities
Other Expenses for 2012-2014(8 months) totaled THB 93.33 million, THB 102.18
million and THB 60.95 million or 49.7%, 45.9% and 42.8% of Total Revenue, respectively,
representing an average of 46.1%. Based on the information received from management,
the IFA anticipates that the Centara Hotel and Convention Centre will be administered more
efficiently going forward, resulting in Other Expenses decreasing as a percentage of Total
Revenue. The rates expected for Other Expenses are 42.9% of Total Revenue for 2014
(4 months), 40.0% for 2015, 37.0% for 2016 and 34.0% for 2017 onwards.
Projected Other Expenses for 2014 – 2019:
2012
2013
2014
2015
Actual
2016
2017
2018
2019
Projected
Other Expenses (THB million)
93.33
102.18
95.92
122.25
131.06
135.65
151.25
168.65
Other Expenses as a % of Total Revenue
49.7%
45.9%
42.9%
40.0%
37.0%
34.0%
34.0%
34.0%
Source:
NPARK, IVG Estimates
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Opinion of the Independent Financial Advisor
ƒ
Natural Park Public Company Limited
Non-Distributable Expenses
Non-Distributable Expenses include expenses that are not incurred operationally but
are required for the operation of the hotel; this expense consists mainly of insurance and
building tax. IFA has forecast this expense at a rate of 2% of Total Revenue for the projected
period.
Projected Non-Distributable Expenses for 2014 – 2019:
2014*
2015
2016
2017
2018
2019
Projected
Non-Distributable Expenses (THB million)
As a % of Total Revenues (%)
Source:
Note:
1.67
6.11
7.08
7.98
8.89
9.92
2.0%
2.0%
2.0%
2.0%
2.0%
2.0%
IVG Estimates
*Data projected for October – December 2014
Working Capital
Average collection period and average payment period are projected based on
historical data, BBM’s working capital management policy and industry norms.
Turnover of current assets and current liabilities
Average collection period:
Average payment period:
20 days
30 days
Capital Expenditure
Boonbaramee Metta Property Co., Ltd allocates 2% of Total Revenue towards the
Furniture, Fittings and Equipment (FF&E) Reserve, regardless of use in the period. This
reserve is used for maintenance, repair or replacement of damaged assets and routine
capital expenditure.
Projected Capital Expenditure for 2014 – 2019:
2014*
2015
2016
2017
2018
2019
Projected
Capital Expenditure (THB million)
Capital Expenditure as a percentage of Total Revenue (%)
Source:
Note:
1.26
6.11
7.08
7.98
8.90
9.92
2.0%
2.0%
2.0%
2.0%
2.0%
2.0%
IVG Estimates
*Data projected for October – December 2014
Corporate Income Tax
Corporate income tax for 2014-2019 is estimated at 20% of pre-tax profit.
Boonbaramee Metta Property Co., Ltd is currently carrying a large tax loss and is not
expected to incur a tax expense in the projected period.
Terminal Value
The IFA assumes a terminal growth rate of 4.5% per year. According to data
released from the World Travel & Tourism Council, travel and tourism spending growth is
expected to average 5.9% between 2014-2024. The IFA conservatively applies a growth
rate of 4.5% for the terminal period.
Based on the above assumptions for financial projection, the IFA has estimated
future cash flows from the project operations. To identify the value of the project, an
estimation of the net present value of future cash flows to the firm is made. The IFA uses a
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
weighted average cost of capital, (WACC), equal to 15%, as a discount rate. The WACC rate
of 15% was selected based on the industry standard for unlisted firms.
From the above assumptions, the IFA arrived at the projected project equity value of
THB 283.47 million as shown in the table below:
Table: Calculation of BBM’s Anantara Resort and Spa Chiang Mai project value based on the DCF Approach:
(Unit: THB million)
2014
2015
2016
2017
2018
2019
Year 1
Year 2
Year 3
Year 4
Year 5
(3 months)
Year 0
Total Revenue
Total Cost
63.19
305.63
354.21
398.98
444.86
496.02
(49.79)
(208.78)
(225.57)
(237.87)
(261.43)
(287.52)
EBIT
13.40
96.85
128.63
161.11
183.43
208.50
(-) Income Tax
(+) Depreciation
(-) Change in Net Working Capital
(-) Capital Expenditure
1.26
0.98
(1.26)
6.11
(1.11)
(6.11)
7.08
(1.15)
(7.08)
7.98
(1.32)
(7.98)
8.90
(0.45)
(8.90)
9.92
(0.52)
(9.92)
Project Cash Flows
Terminal Value
14.38
95.74
127.49
159.79
182.97
207.98
2,069.91
Project Cash Flows + Terminal Value
14.38
95.74
127.49
159.79
182.97
2,277.89
Present Value of Future Cash Flows
13.89
80.39
93.09
101.45
101.02
1,093.62
Net Present Value of the Project
(+) Cash
(-) Interest-bearing Debt
Total Equity Value of the Hotel
1,483.47
0.00
(1,200.00)
283.47
The IFA performed a scenario analysis whereby the forced sale value of the
Anantara Resort and Spa Chiang Mai of THB 1,164 million is inflated by 5% per annum until
the terminal year, 2019, and substituted in for the Terminal Value. The forced sale value in
2019 is equal to THB 1,485.59 million. The result is summarized in the table below:
(Unit: THB million)
(Scenario Analysis)
2014
Year 0
Forced Sale Value
Cash Flows + Forced Sale Value
Present Value of Cash Flows
Net Present Value of the Project
14.38
13.89
2016
2017
2018
Year 1
Year 2
Year 3
Year 4
2019
95.74
80.39
127.49
93.09
159.79
101.45
182.97
101.02
Year 5
1,485.59
1,693.57
813.09
1,202.94
0.00
(+) Cash
(-) Liabilities
2015
(3 months)
(1,200.00)
Total Equity Value of the hotel
2.94
According to the Scenario Analysis for the Anantara Resort and Spa Chiang Mai has
an equity value of THB 2.94 million.
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Part 4
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
In addition, the IFA performed a Sensitivity Analysis tests on the estimated equity
value of the Anantara Resort and Spa to account for a range of effects that could arise from
a change in the key value drivers. Two cases are summarized below:
Case 1: The effect of a change in the Terminal Growth Rate and WACC in the ranges of
2.0 – 6.0% and 12.5 – 17.5%, respectively.
Terminal Growth Rate (%)
Unit: THB million
WACC (%)
2.0%
3.0%
4.5%
5.0%
6.0%
17.5%
(156.30)
(109.67)
(26.28)
5.97
78.87
17.0%
(116.69)
(65.88)
25.60
61.17
142.01
16.0%
(28.73)
32.09
143.14
186.89
287.51
15.0%
73.16
146.76
283.47
338.15
465.74
14.0%
192.45
282.74
453.80
523.49
689.01
13.0%
333.94
446.41
664.74
755.71
976.64
12.5%
414.99
541.38
790.21
895.27
1,153.88
The Sensitivity Analysis testing the effects from a change in Terminal Growth Rate
and WACC indicates that the equity value of the Anantara Hotel and Spa Chiang Mai falls in
the range of THB 32.09 – 523.49 million.
Case 2: The effects of a change in the Occupancy Rate and the growth in ARR. The results are
summarized below:
Occupancy Rate (%)
Growth in Average Room
Rate (%)
Unit: THB million
60%
65%
70%
75%
80%
85%
90%
95%
8.0% (473.85)
(385.04)
(296.23)
(207.42)
(118.61)
(29.80)
59.00
147.81
9.0% (416.61)
(323.03)
(229.45)
(135.87)
(42.29)
51.29
144.87
238.45
10.0% (356.87)
(258.31)
(159.75)
(61.19)
37.36
135.92
234.48
333.03
11.5% (262.38)
(155.95)
(49.52)
56.91
163.34
269.77
376.20
482.63
12.0% (229.54)
(120.38)
(11.21)
97.96
207.13
316.29
425.46
534.63
13.0% (161.78)
(46.96)
67.85
182.67
297.48
412.30
527.11
641.93
14.0%
(91.15)
29.55
150.25
270.95
391.65
512.35
633.06
753.76
15.0%
(17.56)
109.27
236.11
362.94
489.77
616.61
743.44
870.27
The Sensitivity Analysis testing the effects from a change in the Occupancy Rate and
the growth in ARR indicates the equity value of the Anantara Hotel and Spa Chiang Mai falls
in the range of THB (61.19) – 527.11 million
According to the Scenario Analysis and both Sensitivity Analysis cases, the IFA
concludes that the equity value of the Anantara Hotel and Spa Chiang Mai lies in the range
of THB (61.19) – 527.11 million.
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Opinion of the Independent Financial Advisor
D.
Natural Park Public Company Limited
Subsidiaries not yet Generating Income
The Company has many investments in subsidiaries that have not yet generated
income. As the subsidiaries are unlisted and their profitability is uncertain, the investments
have been included into the valuation at cost price less any impairment as per the
Company’s most recent financial statements.
Subsidiaries
Percentage
Ownership
Cost
(%)
(THB millions)
1
Park Opera Company Limited
100
22.56
2
Natural Real Estate Company Limited
100
33.00
3
Natural Park Ville Company Limited
100
243.34
4
Richee Property Management Company Limited
100
1.00
5
Natural Project Chao Phraya Company Limited
100
1.00
6
Natural Hotel Sukhumvit Company Limited
65
26.84
7
Park Gourmet Company Limited
100
25.00
8
Natural Hotel Panwa Company Limited
100
143.00
9
Natural Hotel Chao Phraya Company Limited
99
0.10
10
K. Park Company Limited
50
2.50
11
N Park Global Holding Company
100
1.00
12
N PARK (US), LLC Company Limited
100
0.01
Total investment in subsidiaries
499.34
Less : Impairments as at September 30, 2014
(492.65)
Investment in Subsidiaries included in valuation
Source:
6.69
NPARK & IVG Estimates based on the analyzed data
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Opinion of the Independent Financial Advisor
E.
Natural Park Public Company Limited
Warrants of NPARK-W1
The warrants will be offered along with the newly issued shares in the ratio of 1 new
ordinary share to 1 warrant with the warrant priced at THB 0 per unit and exercise price of
THB 0.06. Therefore, as a comparative guideline for warrant pricing, the IFA has assessed
the warrant value using the Black-Scholes Model as follows:
Assumptions
1. Share offering price is THB 0.052 (which is the average weighted trading price of the
shares of the Company on the Stock Exchange of Thailand for 8 consecutive
business days before the date on which the Board of Directors resolved to propose
the offering of the newly issued shares for approval at the Extraordinary General
Meeting of Shareholders (EGM) No. 2/2014, being the period from 23 September
2014 until 2 October 2014). Price data retrieved from SETSMART, www.setsmart.com)
2. Risk free rate of return on October 2, 2014 was 3.63% (based on the 3-year average
risk-free rate for Thailand, as reported by Bloomberg. The risk-free rate reported by
Bloomberg is based on 10-year Thai government bond)
3. Term of warrant is 5 years from the Date of Issue of Warrants, expiring 6 November
2019.
4. Volatility of returns on shares at retroactive 180 trading days prior to 2 October 2014
equals to 12.22%.
5. Exercise Price for the period is THB 0.06.
6. This Exercise Price above will be used in the Black-Scholes Model and Intrinsic
Value Theory calculation.
7. The amount of shares issues prior to the warrant issue is 361,275,421,764 shares
(includes the expectation that the Rights Offer will be fully subscribed)
The IFA deems the use of theoretic value based on the volatility of returns on shares
at retroactive 180 trading days prior to 28 October 2014 suitable. Therefore, the value of the
warrant should be according to that as calculated with the Black-Scholes Model, which is
equal to THB 0.0044 per unit, which is higher than the offering value of THB 0.
Price of warrant offered to Whitewas Applicant Exercise Price
Theoretical warrant price Exercise Price
0 0.06
0.0044 0.06
0.06
0.0624
93%
The IFA views that the warrant value should be between THB 0 and 0.0044 per unit
as calculation by the Black-Scholes Model results in value of THB 0.0044 per unit while the
Intrinsic Value Theory, which does not take into account the time value, is at THB 0 per unit
(As shown in table below).
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Natural Park Public Company Limited
Summary of warrant price is as follows:
Warrant Price
(THB)
0.0044
0
Black-Scholes Model Theory – value of warrant
Intrinsic Value Theory
Nonetheless the warrant value may change to reflect the change in Company share
price in the market condition at the exercise period.
Effect of warrants on the Company’s value:
Number of warrants being offered
Value of one warrant unit
(Shares)
(THB)
180,637,710,882
0.0044
Total Value
(THB million)
792.20
In addition, the IFA performed a Sensitivity Analysis on the valuation of the warrants
(NPARK-W1) to assess the effect of a change in volatility and market prices.
Historical Price
Volatility (%)
8 day
0.052
15 day
0.058
30 day
0.056
45 day
0.06
30
10.6%
706.17
1,208.45
1,028.41
1,399.11
90
13.7%
873.82
1,362.51
1,189.54
1,544.29
180
12.2%
792.20
1,286.14
1,110.31
1,471.61
270
10.9%
724.05
1,224.31
1,045.26
1,413.76
The Sensitivity Analysis above indicates that the value of the warrants (NPARK-W1)
is in the range of THB 706.17 – 1,544.29 million
The Company’s business value, estimated by the discounted cash flow approach
from its income generating assets and aggregated with various asset values not captured by
the discounted cash flow, is presented in the following table.
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Valuation Summary for NPARK
Case 1: Sum-of-the-Parts Valuation of NPARK excluding the exercise of the warrants (NPARK-W1)
List
Value at October 2, 2014
(THB million)
161.65
-
192.81
(184.17)
-
1,050.10
Khon Kaen Buri Company Limited
331.62
-
812.16
C
Boonbaramee Metta Property Company Limited
(61.19)
-
527.11
D
Subsidiaries not yet generating income
6.69
-
6.69
E
Warrants to purchase common stock (NPARK-W1)
706.17
-
1,544.29
Subtotal
921.04
-
3,875.01
(+) Cash*
6,390.21
A1
The Natural Park Apartment Project
A2
Other Projects
B
6,390.21
(-) Interest-bearing Debt as at September 30, 2014**
(24.33)
-
(24.33)
(+) Deposits paid for Land
934.08
-
934.08
8,260.73
-
11,433.13
361,275.42
-
361,275.42
0.023
‐ 0.032
Total Value of NPARK
Paid up shares as at September 30, 2014 (million shares)
NPARK Value per share (THB)
Remark: *A condition for this transaction is that the rights offer being subscribed for on 16-17 and 20-22 October 2014 is
fully subscribed. A full subscription also results in the increased paid up shares of 361,275.42
million
shares.
**Figure as reflected in NPARK’s financial statements for the period ending September 30, 2014, which
been reviewed by the Karin Audit, Company’s auditor, an approved by the SEC.
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Natural Park Public Company Limited
Case 2: Sum-of-the-Parts Valuation of NPARK including the exercise of the warrants (NPARK-W1)
Value at October 2, 2014
List
(THB million)
161.65
-
192.81
(184.17)
-
1,050.10
Khon Kaen Buri Company Limited
331.62
-
812.16
C
Boonbaramee Metta Property Company Limited
(61.19)
-
527.11
D
Subsidiaries not yet generating income
6.69
-
6.69
E
Warrants to purchase common stock (NPARK-W1)
-
-
-
Subtotal
921.04
-
3,875.01
(+) Cash*
6,390.21
-
6,390.21
(-) Interest-bearing Debt as at September 30, 2014**
(24.33)
-
(24.33)
(+) Deposits paid for Land
934.08
-
934.08
8,260.73
-
11,433.13
(+) Cash received from the exercise of the warrants (NPARK-W1)
10,838.26
-
10,838.26
Total value of the conversion rights of NPARK warrants (NPARK-W1)
18,392.82
-
20,727.10
(706.17)
-
(1,544.29)
Paid up shares as at September 30, 2014 (million shares)
361,275.42
-
361,275.42
Paid up shares after the conversion of the warrants (NPARK-W1) (million shares)
541,913.13
-
541,913.13
0.034
-
0.038
A1
The Natural Park Apartment Project
A2
Other Projects
B
Total Value of NPARK
(-) Warrants to purchase common stock of NPARK (NPARK-W1)
NPARK Value per share (THB)
Remark: *A condition for this transaction is that the rights offer being subscribed for on 16-17 and 20-22 October 2014 is
fully subscribed. A full subscription also results in the increased paid up shares of 361,275.42
million
shares.
**Figure as reflected in NPARK’s financial statements for the period ending September 30, 2014, which
been reviewed by the Karin Audit, Company’s auditor, an approved by the SEC.
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Natural Park Public Company Limited
3.6 IFA opinion based on the Valuation of NPARK
3.6.1 The Fair Value of NPARK
NPARK Total Company Valuation based on the above valuation approaches
NPARK
Value
Value per share
NPARK
NPARK
(THB million)
(THB per share)
4,229.41
0.023
10,312.75
0.029
9,069.15
- 13,217.11
0.025 -.0.037
8,863.75
- 12,917.77
0.25 - 0.036
3.1 Book Value Approach
3.2 Adjusted Book Value Approach
3.3 Price-to-Book Value Ratio Approach
Price-to-Adjusted Book Value Approach
NA
NA
NA
8,260.73
- 11,433.13
0.023 -.0.032
18,392.82
- 20,727.10
0.034 - 0.038
3.4 Price-to-Earnings Approach
3.5 Discounted Cash Flow Approach
Discounted Cash Flow Approach + NPARK-W1
-
Remark: NA (Non-Applicable): Data point not available
The table above details the valuations of NPARK relative to the different approaches.
The results indicate that NPARK is valued between THB 4,229.41 – 20,727.10 million.
The valuation approaches have different strengths and weaknesses in identifying a
fair value of NPARK, as described below:
1)
Book Value Approach: This approach reflects NPARK’s financial position at a certain
point in time and could also reflect its assets’ book value, but doesn’t take into account
NPARK’s profitability and business performance in the future. Therefore, the IFA views
that company valuation by this approach cannot genuinely reflect the value of NPARK.
2)
Adjusted Book Value Approach: This approach could reflect the net asset value better
than the book value approach as there are adjustments by value of land, buildings and
equipment to reflect the market price or fair value. Nevertheless, the fair valuation of
assets looks the assets side only and not the equity side. This method might not truly
reflect the fair valuation of NPARK.
3)
Price-to-Book Value Ratio Approach: This approach reflects NPARK’s financial position
at a certain point in time through comparison with the average ratio of the Peer Group,
but this method does not capture NPARK’s future profitability and performance.
4)
Price-to-Earnings Ratio Approach: NPARK has not been able to generate an income
over the trailing 12 months, therefore, the IFA was unable to appraise NPARK by this
approach.
5)
Discounted Cash Flow Approach: This approach reflects NPARK’s profitability and
growth prospects based on the net present value of the future cash flows expected from
NPARK’s operations in the foreseeable future. Therefore, this approach can more
accurately reflect the share value than all other approaches. In the IFA’s opinion, the
discounted cash flow approach is one of the most suitable methods for measuring a fair
value for BTSA. The base case under the Discounted Cash Flow Approach is
THB 9,377.15 million or THB 0.026 per share
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
In addition, the IFA performed a Valuation Football Field in order to assess the fair
value of NPARK, as indicated by the five valuation approaches, appropriately.
Approach
3.1 BV
Low End
High End
-
0.023
3.2 Adj BV
-
0.029
3.3 P/BV
0.025
0.037
3.3 P/Adj BV
0.025
0.036
3.5 DCF
0.023
0.032
3.5 DCF + W1
0.034
0.038
0.039 0.038 0.037 0.036 0.035 0.034 0.033 0.032 0.031 0.030 0.029 0.028 0.027 0.026 0.025 0.024 0.023 0.022 Each approach has its associated advantages and disadvantages, sensitivities and
range of values have been included depending on the approach. Some approaches value
NPARK based on a projection of its future performance (e.g. DCF) while others value
NPARK based on its current value, thus resulting in a range of valuations. A Valuation
Range is plotted to determine the fair value covering to capture the best possible and
appropriate valuations.
According to the Football Field Valuation Range, NPARK’s equity is valued between
THB 0.025 – 0.036 per share.
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
3.6.2 NPARK Warrant Valuation (NPARK-W2)
The warrants will be offered along with the newly issued shares in the ratio of 1 new
ordinary share to 1 warrant with the warrant priced at THB 0 per unit and exercise price of
THB 0.047. Therefore, as a comparative guideline for warrant pricing, the IFA has assessed
the warrant value using the Black-Scholes Model as follows:
Assumptions
1.
Share offering price is THB 0.052 (which is the average weighted trading price of the
shares of the Company on the Stock Exchange of Thailand for 8 consecutive
business days before the date on which the Board of Directors resolved to propose
the offering of the newly issued shares for approval at the Extraordinary General
Meeting of Shareholders (EGM) No. 2/2014, being the period from 23 September
2014 until 2 October 2014). Price data retrieved from SETSMART, www.setsmart.com)
2.
Risk free rate of return on October 2, 2014 was 3.63%, which is based on the 3-year
daily average of Thailand’s risk-free rate, as define by Bloomberg (The rate is based
on the 10-year Thai government bond yield).
3.
The term of warrant is 5 years from the Date of Issue of Warrants.
4.
Annualized volatility of returns on shares at retroactive 180 trading days prior to
2 October 2014 equals to 12.22%.
5.
Exercise Price for the period is THB 0.047.
6.
This above Exercise Price will be used in the Black-Scholes Model and Intrinsic
Value Theory calculation.
7.
The amount of shares issues prior to the warrant issue is 574,275,421,764 shares
(includes the expectation that the subscribed shares will be fully subscribed)
IFA deems suitable the use of theoretic value based on the volatility of returns on
shares at retroactive 180 trading days prior to 2 October 2014 suitable. Therefore, the value
of the warrant should be according to that as calculated with the Black-Scholes Model, which
is equal to THB 0.0116 per unit, which is higher than the offering value of THB 0.005. In
comparing the discount from share acquisition by exercise of warrants with that the BTSG
would receive compared to the value of the share acquisition by exercise of warrants can be
calculated as follows:
Price of warrant offered to BTSG Exercise Price
Theoretical warrant price Exercise Price
0 0.047
0.0116 0.047
0.047
0.0586
80%
Therefore, BTSG would receive a 20% discount on share value as compared to price
of shares acquired by exercise of warrant, which is deemed suitable. The IFA views that the
warrant value should be between THB 0.0050 and 0.0116 per unit as calculation by the
Black-Scholes Model results in value of THB 0.0116 per unit while the Intrinsic Value
Theory, which does not take into account the time value, is at THB 0.0050 per unit (as
shown in table below).
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Summary of warrant (NPARK-W2) price:
Warrant Price
(THB)
Black-Scholes Model Theory – value of warrant
0.0116
Intrinsic Value Theory
0.0050
Nonetheless the warrant value may change to reflect the change in Company share
price in the market condition at the exercise period
Summary of total value of warrants (NPARK-W2)
Number of warrants issued
(units)
106,500,000,000
Value per warrant
(THB)
0.0116
(THB million)
1,236.14
Total value of warrants (NPARK-W2)
In addition, the IFA performed a Sensitivity Analysis on the valuation of the warrants
(NPARK-W2) to assess the effect of a change in volatility and market prices.
(Unit: THB million)
Historical Price
Volatility (%)
8 days
15 days
30 days
45 days
0.052
0.058
0.056
0.060
30
10.6%
1,205.08
1,676.13
1,496.82
1,892.37
90
13.7%
1,269.93
1,719.18
1,547.55
1,927.30
180
12.2%
1,236.14
1,695.49
1,520.22
1,907.57
270
10.9%
1,211.09
1,679.65
1,501.18
1,895.05
The Sensitivity Analysis above indicates that the value of the warrants (NPARK-W2)
is in the range of THB 1,205.08 – 1,927.30 million
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Part 4:
4. The reasonableness of the share price and offer price of BTSA and KKP
shares compared to the value of NPARK’s common stock including the
warrants (NPARK-W2)
4.1
Reasonableness of the Transaction Price
The Company will pay consideration to BTSG through an allocation of its newly
issued NPARK shares through (a) not more than 213,000,000,000 shares at THB 0.047 per
share and (b) units of the Company’s W2 warrants which will accompany the newly issued
shares, in the ratio of 1 warrant unit per 2 newly issued shares, totaling 106,500,000,000
units with an exercise price of THB 0.06 per warrant unit. The total consideration will be not
more than THB 10,011,000,000 as payment in kind for the transfer of the entire business of
BTSA and KKP to the Company.
In accordance with the Board of Directors Meeting of BTSG No. 9/2557 held on
November 24, 2014, the sale of shares of the BTSA and KKP to NPARK has been approved
for a total value not exceeding THB 9,409.14 million, based on a valuation range of
THB 8,616.47 - 9,409.14 million. This above valuation represents a value of BTSA of
THB 6,777.72 million and for KKP’s value in a range of THB 1,838.75 - 2,631.41 million.
The total value of the offer price will be based on the Final Selling Price of the land in KKP’s
possession, (the land plots on Phyathai Road, next station at Phaya Thai BTS Skytrain).
KKP will be in possession of these land plots prior to the completion of the transaction
(Closing Date).
The IFA was estimated fair value of the BTSA and KKP and summarized the results
in the table below:
BTSA and KKP
NPARK
(Unit: THB million)
(Unit: THB per share)
Purchase / Offer Price
9,409.141
0.047
Fair value
A
Fair value as determined by the IFA in
Part 4.1 and Part 4.2
Fair value as determined by the IFA in
Part 4.3
6,793.64 – 8,628.10
0.025 - 0.036
781.04 - 2,615.50
0.011 - 0.022
9.1% - 38.5%
30.6% - 88.0%
Premium
B
Premium Margin (%)
=B/A
According to the table above, BTSA and KKP's offer price is quoted at a premium
relative the fair value of THB 781.04 to 2,615.50 million, as determined by the IFA. The
price quoted for NPARK is also higher than the fair value by THB 0.011 to 0.022 per share
as determined by the IFA. The IFA has considered the extent to which the values are being
offered at a premium, Premium Margin is thus employed as a basis for comparison and
commentary.
The offering price of the NPARK shares being issued to BTSG has Premium Margin
in the range of 30.6 – 88.0%, which is higher than the Premium Margin associated with
BTSA and KKP of 9.1- 38.5%. The IFA is, therefore, of the opinion that purchase
consideration is reasonable, based on the fact that the Premium Margin associated with the
1
The IFA justifies the price of the transaction by using the maximum offering price is THB 9,409.14 million on the assumption
that KKP to acquire all plots of land for the Transaction. However, the value of the highest purchase price may be adjusted
according to the value of KKP at the Closing Date.
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
NPARK shares exceeds the Premium Margin associated with BTSA and KKP. NPARK
shares issued for the purpose of this transaction are valued 30.8-88.0% higher than the fair
value. In other words, NPARK will be issuing a lesser amount shares for a purchase
consideration for BTSA and KKP when compared to the case that NPARK shares were to be
considered at its fair value.
However, since NPARK will be issuing warrants, NPARK-W2 to accompany the
common shares as a purchase consideration to the BTSG, the IFA also estimates the value
of NPARK-W2 as detailed in Part 4, Section 3.6.2. to reflect the true value of the purchase
consideration issued in exchange for 100% of the shares of the BTSA and KKP,
respectively.
The IFA performed a sensitivity analysis on the valuation of the warrants (NPARKW2) to assess the effect of a change in volatility and market prices.
NPARK
(Unit: THB million)
Purchase/Sale Price
0.047
Fair value A
Fair value as determined by the IFA in Part 4.3
0.025 - 0.036
Premium B
0.011 - 0.022
Premium Margin (%) = B / A
30.6% - 88.0%
Value of NPARK-W2
30-day volatility
0.0060
0.0090
0.0060
0.0090
(Premium Margin) (%)
65.4%
52.5%
14.0%
5.4%
Value of NPARK-W2
180-day volatility ^
0.0058
0.0090
0.0058
0.0090
(Premium Margin) (%)
64.8%
52.2%
14.4%
5.7%
Value of NPARK-W2
270-day volatility ^
0.0057
0.0089
0.0057
0.0089
(Premium Margin) (%)
65.3%
52.4%
14.8%
5.8%
^ Average volatility of NPARK’s common shares for the (number) of days prior to October 2, 2014.
By taking into consideration the value of the NPARK-W2 warrants in the purchase
consideration, the IFA is of the opinion that the purchase consideration for 100% of the
shares of BTSA and KKP is still reasonable. The Premium Margin associated with NPARK’s
common shares, after adjusting for the value of the NPARK-W2 warrants is still greater than
the Premium Margin associated with the shares of BTSA and KKP.
4.2
Reasonableness of newly issued shares and the value of the warrants
for purchase consideration
The IFA is of the opinion that the pricing of the newly issued NPARK shares and
warrants for the purchase consideration deems reasonable for the issuing price is much
higher than the fair value of NPARK. The Football Field Valuation Approach that IFA used in
this report indicates that NPARK’s fair value lies in a range of THB 0.025 - 0.036 per share,
implying that at an offer price of THB 0.047, NPARK is being offered at a premium of THB
0.011 – 0.024 per share or a Premium Margin in the range of 23.40 – 51.07%. The IFA has
summarized the details of the consideration of the appropriateness of the offering price
under Section 4.3 of this report.
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Natural Park Public Company Limited
Furthermore, the IFA notes that the offering share price THB 0.047 baht per share, is
higher than the price offered to existing shareholder of, THB 0.035 per share, in the Rights
Offering that were recently issued.
4.3
Fairness of price and conditions of the transaction
The purchase of BTSA and KKP’s shares from BTSG by the issuance of the
Company’s new shares, instead of cash settlement, is subject to the following major
conditions:
(1) Result of the Due Diligence is satisfying to the both parties;
(2) The Completion of the Rights Offering of the Company that is taking place on
16 - 17 and 20 - 22 October 2014;
(3) The transaction is not classified as an acquisition of “Type 4” assets or backdoor
listing as prescribed in the Notification on acquisition and disposal of asset; and
(4) The Extraordinary Shareholders’ Meeting No. 2/2014, to be held on 29 December
2014, approves the acquisition other related transactions, as follows:
Matters to proposed to the shareholders’ meeting for
approval
Agenda 2:
Conditions for approval
To consider and approve the entering into the
business acquisition transaction of BTS Assets
Co., Ltd. (“BTSA”) and Kamkung Properties Co.,
Ltd. (“KKP”), by acquiring all ordinary shares of
both companies from BTS Group Holdings Public
Company Limited (“BTSG”) in the aggregate
amount up to THB 10,011 million
No less than ¾ of votes from shareholders
attending the meeting and having the rights
to vote, excluding shareholders with conflict
of interests.
Agenda 3: To consider and approve the increase in the
registered capital of the Company
No less than ¾ of votes from shareholders
attending the meeting and having the rights
to vote.
Agenda 4:
To consider and approve the allocation of the
newly issued ordinary shares of the Company
Majority votes from shareholders attending
the meeting and having the rights to vote.
Agenda 5: To consider and approve the exemption of BTSG
from making a tender offer for the shares of the
Company (Whitewash)
No less than ¾ of votes from shareholders
attending the meeting and having the rights
to vote.
Agenda 6: To consider and approve the issuance of the
warrants to buy the newly issued shares of the
Company No. 2 (NPARK-W2) allocated to BTSG
Majority votes from shareholders attending
the meeting and having the rights to vote.
Agenda 7: To consider and approve the change of the
Company’s name, the security symbol and the
Company’s seal
No less than ¾ of votes from shareholders
attending the meeting and having the rights
to vote.
Agenda 8: To consider and approve the amendment to
Clause 1 and Clause 4 of the Company’s
Memorandum of Association in order to be in line
with the change of the Company’s name and the
increase in the registered capital of the Company
No less than ¾ of votes from shareholders
attending the meeting and having the rights
to vote.
Agenda 9: To consider and approve the appointment of the
new directors, including the change of the
directors’ authority of the Company
Majority votes from shareholders attending
the meeting and having the rights to vote.
Agenda 10: To consider and approve the amendment to the
Company’s Articles of Association
No less than ¾ of votes from shareholders
attending the meeting and having the rights
to vote.
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
As Agenda 2 to 10 are interrelated, failure to approve one of those agendas will
result in the cancellation of all approved items, and the termination of consideration of
subsequent items (and it is deemed that agenda 2 to 10 are not approved by shareholders).
In sum, should any of the above agendas are not approved by the shareholders, the
transaction on the purchase of BTSA and KKP’s shares from BTSG by the issuance of the
Company’s new shares and warrants, and the exemption of tender offer via Whitewash
waiver will not take place.
(5) Board of Directors of BTSG approve the Transaction; and
(6) NPARK and BTSG must enter into and sign documents and agreements related
to the sale and purchase of BTSA and KKP common shares, as well as all
conditions agreed upon by the Company and BTSG are met.
(7) Key terms based on the Memorandum of Understanding (MOU) with regards to
Share Purchase Agreement and Share Subscription Agreement are summarized
as follows:
ƒ
There are no material changes to the status and the assets of the Business
and its subsidiaries according to the conditions set out in the agreement.
ƒ
There are no material changes to the status and the assets of BTSA and KKP
according to the conditions set out in the agreement.
ƒ
The Applicant and the Business obtain all necessary regulatory approvals
from the relevant administrative agencies and/or governmental agencies and
all necessary third party consents;
ƒ
BTSA transfers the land plots located on Phaholyothin road, near BTS Mo
Chit Station, with the total area of 5-0- 15.7 rai to the entity jointly controlled
by the Applicant and other company prior to the closing date and BTSA has
set aside a case reserve for the payment of corporate income tax incurred
from the sale of such land plots;
ƒ
The calculation of the final selling price in respect of the sale and purchase of
shares in KKP to be determined according to the actual area of land located
on Phayathai road, near BTS Phayathai Station which KKP will own before
the closing date; and
ƒ
The increase in BTSA’s capital and KKP’s capital for each of BTSA and KKP
to use the proceeds from the capital increase to repay the entire amount of
long term loans granted by the parent company
ƒ
The Business has obtained the shareholders’ approval to (a) change its name
to U City Public Company Limited and amend certain clauses of the
Memorandum of Association and the Articles of Association which are
relevant to the change of name and seal of the Business and (b) appoint the
persons nominated by the Applicant to be new directors of the Business and
authorized directors having signing authority jointly with the existing directors
of the Business.
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Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
The transaction between the Company and BTSG will in the form of the exchange of
shares based on the following terms:
(1) BTSG will proceed to transfer all shares of BTSA and KKP (100% of paid-up
capital of BTSA and KKP) to the Company in accordance to the relevant laws
and regulations, in addition to completing condition 2 below;
(2) The Company will proceed with the registration of the BTSG as a new
shareholder in accordance to the laws and regulations, together the receipt of the
transfer of shares in (1)
As of the issuance of this IFA report, there are some updates of the transaction as following:
Conditions of the Transaction
Update and Progress
(1) Result of the Due Diligence is
satisfying to the both parties
The management of the Company is satisfied with the due
diligence of both BTSA and KKP.
(2) The Completion of the Rights
Offering of the Company that is
taking place on
16 - 17 and 20 - 22 October 2014
The Company has successfully completed the subscription and
the registration of 180,637,710,882 newly issued shares placed
on 31 October 2014.
(3) The transaction is not classified
as an acquisition of “Type 4”
assets or backdoor listing as
prescribed in the Notification on
acquisition and disposal of asset.
The maximum size of the transaction is equal to 81.96% of the
Company’s total value of the consideration, based on the
Company’s consolidated financial statements as of 30 September
2014 (with the adjustment of the proceeds of capital increase
which had been fully subscribed by existing shareholders, making
the total assets worth THB 13,513,683,881). This is therefore not
considered as a backdoor listing. Combining with other acquisition
transactions over the last 6 months, the total transaction
amounted to 97.65% with a transaction size of 50% or higher, but
lower than 100%.
(4) Board of Directors of BTSG
approve the Transaction
The meeting of Board of Directors No. 9/2014, held on 24
November 2014, approved the sale of all common shares of
BTSA and KKP to the Company
(5) NPARK and BTSG must enter
into and sign documents and
agreements related to the sale
and purchase of BTSA and KKP
common shares,
As of the issuance of this IFA report, NPARK and BTSG has
entered into Memorandum of Understanding and the expected
executed date will be within December 4, 2014
When taking into consideration the conditions of the transaction and the pricing as a
whole, the IFA is in the opinion that this transaction has fair conditions to both parties. The
conditions are at arm’s length basis, and not taking advantages of the Company or its
shareholders. By looking the update and progress of the transaction, it is clearly shown that
there are many fulfilled conditions. The main condition to be met will be the approval of the
Company’s shareholders on the relevant resolutions at the upcoming EGM to be held on
December 29, 2014. The shareholders should full use this IFA report as a supplementary to
approve or reject this proposed transaction.
I V Global Securities Public Company Limited
Part 4
Page 79
Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Part 5: Opinion of the Independent Financial Advisor
The meeting of Natural Park Public Company Limited’s (the “Company” or “NPARK”,
or “Business”) Board of Directors No. 15/2014, held on 3 October 2014, No. 18/2014 held on
6 November 2014, No. 19/2014 held on 13 November 2014, and No. 20/2014 held on 24
November 2014, approved the acquisition of the shares of BTS Assets Company Limited
(“BTSA”) and Kamkoong Property Company Limited (“KKP”) from BTS Group Holdings Public
Company Limited (“BTSG” or the “Applicant”), a non-connected party1, at a total
consideration of not more than THB 10,011 Million. Details are as follows:
1) Purchase all shares of BTSA with a par value of THB 100 per share or
approximately 100 percent of BTSA.
2) Purchase all shares of KKP totaling with a par value of THB 100 per share or
approximately 100 percent of KKP.
After the execution of this transaction, BTSG will become a major shareholder of the
Company with shareholding of 37.09% of the Company’s paid-up capital (after Private
Placement) and be able to nominate persons to be directors and/or management of the
Company. BTSG, therefore, is required to make a mandatory tender offer for the remaining
shares of the Company it doesn’t own in accordance with the Notification of the Capital Market
Supervisory Board.
However, BTSG would like to apply for a waiver of the tender offer for all securities of
the Company by virtue of a resolution of the shareholders’ meeting of the Company
(“Whitewash”) pursuant to the Notification of the SEC. Therefore, the Company appointed I V
Global Securities Public Company Limited (“IVG” or an “Independent Financial Advisor”) to
render an opinion on the Whitewash resolution.
IVG has studied the information Memorandum as well as information from the
interviews with management of NPARK, BTSG, BTSA and KKP, documents from NPARK,
BTSG, BTSA and KKP – such as financial statements, business plans, property appraisal
report, and publicly disclosed information – such as Form 56-1, information disclosed to the
Stock Exchange of Thailand (“SET”) and the Securities and Exchange Commission (“SEC”),
and financial information from various websites, in order to form an opinion on the transaction.
The Independent Financial Advisor views that the transaction is reasonable and beneficial to
the Company, and served in the best interests of the shareholders in the long run. The
transaction also serves an opportunity for, the Company in its endeavor to operate the real
estate development business in the future, as well as to increase its long term competiveness
capabilities, with the views of the IFA as following:
(1) The acquisition of all ordinary shares in BTSA and KKP by way of issuance and offering
of newly issued ordinary shares and warrants of the Company for sale to BTSG in
replacement of a cash consideration is considered appropriate based on the following
reasons:

1
In view of this transaction in overall, the IFA is of the opinion that this investment aims
for the Company to acquire properties that are developable into projects in prime areas
with business potentials, without incurring any new debts. Besides, the Company will
acquire a capable strategic partner that could support the Company’s
No relationship exists between Buyer and Seller prior to this transaction. Once BTSG becomes one of the shareholders in
NPARK, BTSG will nominate representatives to be the directors on the Board of Directors of NPARK. The aforementioned
persons (has no relationship as major shareholders or controlling person of BTSG) are not one of the major shareholders of
NPARK; also has no relationship with executives, controlling person or major shareholders of NPARK. BTSG, therefore, is
not deemed as Connected Persons according to the criteria defined in the related rules and regulations.
I V Global Securities Public Company Limited
Part 5
Page 1
Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
business operation and enhance its competiveness in the future. The acquired
shares in BTSA and KKP will be paid in kind by issuance and offering of new
ordinary shares of the Company and its subsidiaries to BTSA, thereby enabling the
Company to use remaining funds from the capital increase for development of
existing projects and as working capital in its business operation.
ƒ
Moreover, the acquisition of shares in BTSA and KKP will help support the
Company’s current core activities, where its main revenue will still be derived from
the real estate development business with recurring income. Its business structure
and business operation policy after the acquisition of shares in BTSA and KKP will be
focused on the real estate that generates recurring income, which is the Company’s
existing core business, as the management believes that this business can ensure
sustainable and recurring income for the group.
ƒ
With regards to the shareholder structure, to have BTSG as its major shareholder
holding a 37.09% stake after this transaction will bode well for the Company since
BTSG has had a solid financial position with high potential and dependable
experience in the real estate field. The nomination of BTSG’s representatives to sit
on the Company’s Board of Directors and join in business administration will create
benefits for other shareholders because there will be a major shareholder to oversee
business operation of the Company to ensure generation of profit and return for the
shareholders, as well as to protect the interest of all shareholders with respect to
BTSG’s investment and shareholding of 37.09% in NPARK, apart from the
administration by the current Board of Directors and management team of the
Company.
ƒ
The IFA has provided the opinion regarding advantages from entering into the
transaction as follows:
ƒ
o acquire properties that are developable into projects in prime areas with business
potentials, strengthening the Company’s current core activities in developing
sustainable recurring income;
o acquire income generating properties without incurring any financial burden;
o diversification of investment risk;
o acquire a compelling partner with experience and capability in business operation
and potential for future business cooperation;
o an increased opportunity to generate recurring income and return to shareholders
in the long term; and
o a reasonable price for the acquisition of shares in BTSA and KKP.
Nevertheless, the entry into the transaction in acquisition of shares in BTSA and KKP
involves some disadvantages and risks that the shareholders should take into
account as a basis for making a voting decision whether to approve or disapprove
the transaction. Disadvantages from the transaction can be summarized as follows:
o inexact in-depth details on empty plots of land;
o impact on shareholders due to the necessity of additional fund mobilization for
such large-scale project development;
o Control dilution effect;
o BTSG can exercise its veto rights regards any material resolutions or significant
matters;
o Constraints on business expansion into property development for sale along the
electric train routes or near BTS interchange station
I V Global Securities Public Company Limited
Part 5
Page 2
Opinion of the Independent Financial Advisor
ƒ
Natural Park Public Company Limited
Risks from the entry into this transaction can be summed up as follows:
o
o
o
o
o
risk from securing funding sources for project development;
risk from inexact details of project development plan;
risk associated with failure to obtain construction permit and/ or an EIA approval;
risk involved with cost overrun; and
risk concerned with conflict of interest in real estate business.
Based on the reasonableness, advantages, disadvantages and risks as summarized
above, the IFA is of the opinion that the acquisition of all ordinary shares in BTSA and KKP
through an issuance and offer of ordinary shares and warrants of the Company for sale to
BTSG in replacement of a cash consideration is appropriate. The shareholders can study
details of our opinion on the acquisition of assets transaction in Part 2 of this report.
In view of the appropriateness of transaction price, the IFA deems that the price of
the transaction in acquisition of shares in BTSA and KKP by way of offering of newly issued
shares and warrants of the Company is reasonable. Our opinion on this matter can be
summed up as follows:
The IFA has determined appropriateness of the transaction price by measuring a fair
value of BTSA, KKP and NPARK for comparison with the acquisition price of the ordinary
shares of BTSA and KKP, as well as the offering price of NPARK shares to BTSG in
exchange for shares of the two entities, a summary is shown below:
BTSA and KKP
NPARK
(Unit: THB million)
(Unit: THB per share)
Purchase / Offer Price
9,409.142
0.047
Fair value
Fair value as determined by the IFA in
Part 4.1 and Part 4.2
Fair value as determined by the IFA in
Part 4.3
6,793.64 – 8,628.10
0.025 - 0.036
Premium
B
781.04 - 2,615.50
0.011 - 0.022
Premium Margin (%)
=B/A
9.1% - 38.5%
30.6% - 88.0%
A
According to the table above, BTSA and KKP's offer price is quoted at a premium
relative the fair value of THB 781.04 to 2,615.50 million, as determined by the IFA. The
price quoted for NPARK is also higher than the fair value by THB 0.011 to 0.022 per share
as determined by the IFA. The IFA has considered the extent to which the values are being
offered at a premium, Premium Margin is thus employed as a basis for comparison and
commentary.
The IFA has determined appropriateness of the transaction price by measuring a fair
value of BTSA, KKP and NPARK for comparison with the acquisition price of the ordinary
shares of BTSA and KKP, as well as the offering price of NPARK shares to BTSG in
exchange for shares of the two entities, details of which are as follows:
As evident from the above table, the acquisition price of shares in BTSA and KKP is
higher than the fair value appraised by the IFA, representing a premium of THB 781.04
2
The IFA justifies the price of the transaction by using the maximum offering price is THB 9,409.14 million on the assumption
that KKP to acquire all plots of land for the Transaction. However, the value of the highest purchase price may be adjusted
according to the value of KKP at the Closing Date.
I V Global Securities Public Company Limited
Part 5
Page 3
Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
million – 2,615.50 million. As well, the offering price of NPARK shares to BTSG is higher
than the fair value appraised by the IFA, representing a premium of THB 0.011 – 0.022 per
share. The IFA has thus calculated a premium margin of both the acquisition price and the
offering price for comparison in rendering our opinion on appropriateness of the price for this
transaction.
It is apparent that the offering price of NPARK shares to BTSG has a premium
margin of 30.6% - 88.0%, which is higher than the premium margin of the acquisition price of
shares in BTSA and KKP of 9.1% - 38.5%. Therefore, the price for the transaction in
acquisition of shares in BTSA and KKP is considered reasonable since NPARK will benefit
from the premium margin of the offering price of shares of the Company that is higher than
the premium margin of the acquisition price of the assets. Having a higher premium margin
means that NPARK will be able to offer its shares for sale to BTSG at a price higher than the
price at which it will acquire the shares in BTSA and KKP. As a consequence, NPARK will
issue a smaller amount of shares for offering to BTSG in exchange for the shares of BTSA
and KKP in case the premium margin is lower than 30.6% - 88.0%.
(2) An approval of the waiver for BTSG to acquire ordinary shares of the Business without
the requirement to make a tender offer for all securities of the Business by virtue of
resolution of the shareholders’ meeting of the Business (Whitewash resolution) is
deemed appropriate based on the following reasons:
ƒ
In overall, the capital increase through issuance and offering of ordinary shares on a
private placement basis to the Applicant will enable the Business to acquire shares in
the entities that own assets with high business potentials without incurring any debts,
and will also acquire a capable business partner that will help support business
operation and enhance competitive potential of the Business in the future, thereby
creating benefits for the Business and its shareholders. Moreover, the Business can
use funds remaining from the capital increase via allocation of shares to existing
shareholders for development of its current projects and also as working capital in its
business operation.
ƒ
After the capital increase, the Applicant will acquire shares and voting rights equal to
37.09% in the Business, which will create a control dilution effect on other existing
shareholders (equivalent to 46.93% in this case). In addition, with such percentage of
voting rights, the Applicant can exercise veto votes against certain crucial issues that
require at least three-fourths of total votes at the shareholders’ meeting of the
Business. In overall, however, it is evident that the issuance and offering of ordinary
shares on a private placement basis to the Applicant will bring about benefits to the
Business and its shareholders in the long term.
ƒ
Furthermore, in the past five years there have never been any representatives of the
former major shareholders participating in business administration through director
nomination. Therefore, the nomination of directors by BTSG to join in the business
management will be beneficial to all other shareholders because there will be a major
shareholder to oversee the business operation and protect the interest of the
shareholders as a whole, apart from the administration by the current Board of
Directors and management team of the Business.
ƒ
As of the submission date of the application for the waiver, the Applicant has clearly
expressed an intention to not make any material change to the core business
operation, management structure and organization structure, policy or plan on
business operation of the Business and its subsidiaries in the next 12 months from
the submission date of the application for the waiver, other than a change decided
jointly with the Board of Directors and the management of the Business, whereby the
Applicant shall exercise its right to vote for or against such matter according to the
number of voting rights it holds in the Business. As such, it can be deemed that the
I V Global Securities Public Company Limited
Part 5
Page 4
Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
Business will continue to operate business pursuant to its existing operational plan
and policy. Any consideration and action thereof must be made or taken according
to the usual procedures for business administration on a conservative basis and
subject to resolution of the Board of Directors of the Business and/or resolution of the
meeting of shareholders of the Business, as the case may be, in accordance with the
Articles of Association of the Business and the relevant laws and regulations.
ƒ
Nevertheless, should the shareholders disapprove the Whitewash resolution of the
Applicant, the transaction in acquisition of ordinary shares in BTSA and KKP must
then be cancelled, which will create risks and disadvantages to the Business as
follows:
o The Business will lose the investment opportunity in BTSA and KKP, which own
projects that will potentially generate revenue and return for the Business.
o The Business will lose the opportunity to acquire the existing assets of BTSA and
KKP which are in prime locations with high business potentials.
o The Business will lose the opportunity to access diverse funding channels and to
leverage on the network of BTSG which could support its business in various
aspects
o The proposed investment in ordinary shares of BTSA and KKP is considered a
clear and concrete offer and will enable the Company to further develop
business instantaneously.
Based on all above mentioned reasons, the IFA is of the opinion that an approval for
the Applicant to acquire the newly issued ordinary shares of the Business with a waiver from
the requirement to make a tender offer for all securities of the Business (Whitewash
resolution) is reasonable. The shareholders can refer to Part 3 of this report for further
details RE: Opinion of the Independent Financial Advisor on Reasonableness of the
Whitewash resolution.
The offering price of the newly issued shares of the Business to be offered to the
Applicant at THB 0.047 per share is considered appropriate as it is higher than a fair value
of the Company as appraised by the IFA by the Valuation Football Field approach which is in
a range of THB 0.025 – 0.036 per share. The calculated fair value is lower than the offering
price by THB 0.011 – 0.024 per share or lower by 23.40% – 51.07% of the offering price.
The shareholders thus receive benefits by entering into this transaction.
Approach
3.1 BV
Low End
High End
-
0.023
3.2 Adj BV
-
0.029
3.3 P/BV
0.025
0.037
3.3 P/Adj BV
0.025
0.036
3.5 DCF
0.023
0.032
3.5 DCF + W1
0.034
0.038
I V Global Securities Public Company Limited
Part 5
0.039 0.038 0.037 0.036 0.035 0.034 0.033 0.032 0.031 0.030 0.029 0.028 0.027 0.026 0.025 0.024 0.023 0.022 Each approach has its associated advantages and disadvantages, sensitivities and
range of values have been included depending on the approach. Some approaches value
NPARK based on a projection of its future performance (e.g. DCF) while others value
NPARK based on its current value, thus resulting in a range of valuations. A Valuation
Range is plotted to determine the fair value covering to capture the best possible and
appropriate valuations, as shown below:
Page 5
Opinion of the Independent Financial Advisor
Natural Park Public Company Limited
In conclusion, the Independent Finance Advisor is in the opinion that the
shareholders approve the transaction of the acquisition of assets and Whitewash resolution
based on the reasonableness and necessity of the transaction, in coupled with the
reasonableness pricing of the transaction.
Nonetheless, in deciding whether to approve or disapprove the said waiver, the
shareholders can make consideration thereon based on the above reasons and opinion
rendered by the IFA. The final decision depends on the shareholders’ individual judgment.
The IFA hereby certifies that we have provided the opinion fairly using independent
professional judgments, by placing the interests of the shareholders at the utmost
importance.
Independent Financial Advisor
I V Global Securities Public Company Limited
(Pisit Jeungpraditphan, CFA, CAIA)
Senior Vice President
I V Global Securities Public Company Limited
Part 5
Page 6
Attachment 1
Company Information and Operating Results of
Natural Park Public Company Limited
1. General Information
Name
:
Natural Park Public Company Limited
Type of Business
:
Property Development
Website
:
http:// www.naturalpark.co.th
Address
:
88 Soi Klang (Sukhumwit 49), Sukhumwit Road, Wattana,
Bangkok 10110
Telephone
:
0-2259-4800-11
Fax
:
0-2260-5078
Registered Capital
:
THB 541,913,132,646
Divided into 541,913,132,646 ordinary shares with a par value of
Baht 1.00 per share
Paid-up Capital
:
THB 361,275,421,764
Divided into 361,275,421,764 ordinary shares with a par value of
Baht 1.00 per share
2. Nature of Business
2.1 Background
Natural Park Company Limited was established on 23 June 1988 to conduct the business
of full-range real estate development for lease, service, sale, and management. Its main office
is located at 88 Soi KLANG (Sukhumwit 49), Sukhumwit Road, Wattana, Bangkok 10110. The
Company was registered its conversion to a public company on 3 February 1994 under Natural
Park Company Limited and received a permission to trade in the Stock Exchange of Thailand
on 23 July 2003
2.2 Type of Business
The Company operates real estate development business in various types comprising.
(1) Real estate development for lease, service and hotel business: Main revenue in
2013 and 2014 was generated from (1.1) The Natural Park Apartment Project; (1.2) Centara
Hotel and Convention Center Khon Kaen, which officially opened for full-scale operation in
December 2013; and (1.3) Anantara Chiang Mai Resort and Spa, in which the Company
started investment in September 2014. Over 2013-2014, the Company gradually invested in
Prospect Development Company Limited (“Prospect”) at a total ratio of 19.81 percent of
Prospect's registered capital. Prospect operates a business of leasing warehouse and factory
spaces.
(2) Real estate development for sale: From 2013 up to the present, the Company
developed and launched sale for two projects, comprising (2.1) Park Ramindra Project which is
a low-rise condominium with 206 units of the 8-storey building and (2.2) Park Aran Project
which consists of (1) Park Aran Condo Project, a low-rise 8-storey condominium offering 512
Attachment 1 Page 1
units, and (2) Park Aran Boulevard Project, a three-and-a-half-storey commercial building with
62 units.
2.3 Investment Structure of the Company as of 30 September 2014
The Company’s investments in subsidiaries and associated companies are as follows.
No
Company Name
Office Location
Percentage
of the
Company's
shareholding
Paid-up
Capital
Registered
Capital
Shares
Offered
Par
Value
(THB)
(THB)
(Shares)
(THB)
Real estate business for rent, service and hotel
1
Khon Kaen Buri Company Limited
operates a hotel business
999 Moo 4 Prachasamosorn Road, Nai
Muang Sub-district, Muang Khon Kaen
District, Khon Kaen Province
100.00%
800,000,000
800,000,000
8,000,000
100
13.56%1/
1,200,000,000
1,200,000,000
120,000,000
10
100.00%
1,000,000
1,000,000
10,000
100
100.00%
700,000,000
700,000,000
7,000,000
100
Telephone 043 209 888
Fax 043 209 889
2
Prospect Development Company
Limited operates a business of
leasing warehouse and factory
spaces
48/23 Tisco Tower, 12 A Floor, North
Satorn Road, Silom Sub-district, Bang
Rak District, Bangkok
Telephone 02-697-3860
Fax 02-697-3869
3
Npark Global Holding Company
Limited is to holding company for
local and foreign investment in hotel
and / or real estate business
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
4
Boonbaramee Metta Propety
Company Limited *
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
* : Investment in hotel and real estate development business by investing in 2 companies, namely:
1) Pacific Hotel Chiangmai Company Limited, having 600,000,000 Baht in registered and paid-up capital, at a par value of 100 Baht each, Pacific Hotel
Chiangmai Company Limited operates a hotel business under the name of “Anantara Chiang Mai Resort & Spa Hotel,” located on Charoen Prathet Road, Changklan
Sub-district, Muang Chiang Mai District, Chiang Mai Province.
2) Pacific Chiangmai Company Limited having 200,000,000 Baht in registered and paid-up capital, at a par value of 100 Baht each, Pacific Chiang Mai
Company Limited operates a business of leasing land and structures to Pacific Hotel Chiang Mai Company Limited
5
N Park (US) , LLC Company Limited
operates Investment in hotel and / or
real estate business
Registered in USA
100.00%
USD 200
99.30%
100,000
100,000
1,000
100
99.94%
1,000,000
1,000,000
10,000
100
50.00%
5,000,000
5,000,000
100,000
50
100,000
100,000
10,000
10
Business of real estate development for sale
1
Natural Hotel Chaophraya Company
Limited operates a business of real
estate development
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-697-3860
Fax 02-697-3869
2
Natural Project Chaophraya
Company Limited operates a
business of real estate development
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
3
K Park Company Limited
operates a business of real estate
development
88 Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
Joint venture
Joint Venture of The Natural Park
Public Company Limited,
Amanresort Services Limited and
Silverlink Holding Limited
An associated company
1
MHG NPARK Development
Company Limited, is to property
development
12th floor Berli Jucker housr, 99 Soi
Rubia Sukhumvif 42 Road, Kwaeng
Phhrakanong Sub-district, Klongtoey
District, Bangkok
50.00%
(remainly
50% by Hua
Hin Resort
Limited)
Attachment 1 Page 2
No
Company Name
Office Location
Percentage
of the
Company's
shareholding
Paid-up
Capital
Registered
Capital
Shares
Offered
Par
Value
(THB)
(THB)
(Shares)
(THB)
A group of companies that have not yet operated a business
1
Natural Hotel Panwa Company
Limited
is to operate a
hotel business
5/3 Moo 8 Yon Bay-Khao Khard Road,
Wichit Sub-district, Muang Phuket
District, Phuket Province
100.00%
143,000,000
143,000,000
1,430,000
100
2
Natural Hotel Sukhumvit Company
Limited is to operate a hotel
business
555/5 Soi Sukhumvit 63 (Ekamai),
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
71.57%
41,352,750
150,000,000
1,500,000
100
5
Natural Park Ville Company Limited
is to operate a management
business
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
100.00%
43,000,000
43,000,000
430,000
100
100.00%
33,000,000
33,000,000
330,000
100
100.00%
22,555,000
50,000,000
5,000,000
10
99.94%
1,000,000
1,000,000
10,000
100
100.00%
25,000,000
50,000,000
500,000
100
Telephone 02-2594800
Fax 02-2605078
6
Natural Real Estate Company
Limited
is to operate
a real estate development business
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
7
Park Opera Company Limited
is to operate a real estate
development business
88 Soi Klang (Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
8
Richee Property Management
Company Limited
is to operate a real estate
development business
88 Soi Klang (Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
9
Park Gourmet Company Limited
is to operate a restaurant business
88 Soi Klang (Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
1/
Remarks: The Board of Directors of the Company No.16/2014 held on 15 October 2014 resolved to approve the purchase of
additional 7,500,000 ordinary shares in Prospect Development Co., Ltd of at par value of THB 10 per share, totaling THB
75,000,000 from Chainan-Bangplee Parkland Co., Ltd., which is additionally acquired 6.25 percent of ordinary shares in Prospect,
bringing its total shareholding to 19.81 percent of total paid up capital of Prospect.
2.4 Revenue Structure
Company’s revenue structure by product
Business
Operated by Percentage
of the
Company's
shareholding
2011
Revenue
2012
%
Revenue
(Million
Baht)
2013
%
Revenue
(Million
Baht)
Quarter 3/2014
%
Revenue
(Million
Baht)
%
(Million
Baht)
Property Development for Rent, Service
Business of space rental and services
- The Natural Park Apartment
Natural Park
PCL
100.00
60.34
11.68
77.04
9.44
94.26
12.34
72.28
31.37
Khon Kaen
Buri Co., Ltd
100.00
-
-
-
-
92.67
12.13
119.18
51.72
- Anantara Chiangmai Resort and Spa Pacific Hotel
Hotel
Chiangmai
Co.,Ltd
100.00
-
-
-
-
-
-
12.67
5.50
- Interest receivable
6.11
1.18
9.82
1.20
33.47
4.38
11.66
5.06
- Dividend earning
3.54
0.68
7.38
0.90
2.21
0.29
-
-
26.70
5.17
0.11
0.01
0.27
0.03
0.25
0.11
Hotel business
- Centara Hotel & Convention
Khon Kaen
Other Revenue
- Gains on foreign exchange
- Gain on disposal of property
- Gain on sale of investment in related
-
-
0.49
0.06
-
-
-
-
193.12
37.39
44.13
5.41
44.33
5.80
-
-
Attachment 1 Page 3
Business
Operated by Percentage
of the
Company's
shareholding
2011
Revenue
2012
%
Revenue
(Million
Baht)
2013
%
Revenue
(Million
Baht)
Quarter 3/2014
%
Revenue
(Million
Baht)
%
(Million
Baht)
company
- Reversal of allowance for doubtful
-
-
4.16
0.51
-
-
-
-
-
-
294.29
36.04
0.86
0.11
-
-
accounts-other receivables
- Gain on sale of investment in
associated company
- Gain on debt restructuring
208.06
40.28
320.97
39.31
330.25
43.2
-
- Gain on price negotiation
-
-
-
-
164.02
21.47
-
-
- Gain on sale of investment in
-
-
43.99
5.39
5.70
2.47
18.70
3.62
14.14
1.73
8.69
3.77
subsidiary
- Others
Total Revenue
516.57 100.00
816.52 100.00
1.72
0.23
764.06 100.00
230.44 100.00
Source: Form 56-1 of NPARK and Financial statement as at September 30, 2014 which has been reviewed by Karin Audit Co., Ltd (an approved
auditor by the Office of the SEC).
Remarks: * In 2013, the Company did not generate revenue from real-estate development for sale because the Company launched and sold the Park
Ramindra Project but did not realize revenue until ownership transfer per the Revenue Recognition Criteria under accounting standard and the
Company's accounting policy
3. List of Shareholders
Top 10 major shareholders of NPARK as of November 13, 2014 (the latest book closing
date) are as follows:
No.
Name of Shareholders
Number of Shares (Shares)
% Shareholding
1.
Phillip Securities Pte Ltd.
59,950,000,000
16.59
2.
UOB KAY HIAN (HONG KONG) LIMITED - Client Account
11,732,528,000
3.25
3.
Mr.Wanchai Panwichien
10,650,000,000
2.95
4.
Mr. Somkiet Chatsakulwilai
9,580,091,572
2.65
5.
Mrs.Sukalaya Thongphun
8,995,375,650
2.49
6.
Thailand Securities Depository Company Limited
6,669,142,265
1.85
7.
Mr.Komol Jungrungreangkit
6,034,542,672
1.67
8.
Mr. Thongplew Siripornpitak
5,403,914,122
1.50
9.
Mr.Chaiyan Chakarakul
4,900,489,608
1.36
10.
3,200,000,000
0.88
Total of 10 major shareholders of the company.
Mr.Netnthirat Pongnarajsorn
127,116,083,889
35.19
Other
234,159,337,875
64.81
Total
361,275,421,764
100.00
Source: Thailand Securities Depositary Co., Ltd.
4.
Board of Directors
List of NPARK’s Board of Directors as of November 24, 2014 are as follows.
No.
Name of Directors
Position
1
Mr. Sakthip
Krairiksh
Chairman of the Board of Directors and Independent Director
2
Mr. Chaiwat
Atsawintarangkun
Chairman of the Audit Committee and Independent Director
3
Mr. Thavisakdi
Tanta-Nanta
Audit Committee and Independent Director
4
Mr. Manu
Maniwatana
Audit Committee and Independent Director
5
Mr. Nakorn
Laksanakarn
President and Chief Executive Officer
6
Mr. Burin
Pusiri
Director and Executive Officer
7
Mr. Weerawat
Wattanatchariya
Director and Executive Officer
Source: www.set.or.th
Attachment 1 Page 4
5. Summary of Financial Highlights and Analysis of Operational Performance and
Financial Status of NPARK
Statement of Financial Position
(Unit: THB million)
Statement of Financial Position
2011
Assets
Current assets
Cash and cash equivalents
Current Investments
Trade accounts receivable and other accounts
receivable - net
Amounts due from related parties - net.
Short-term loans to related parties and interest
receivable - net
Inventories
Real estate projects under development
Deposits for land purchase
Other current assets - net
Total current assets
Non - current assets
Pledged deposits at financial institutions - long term
Investments in available-for-sale securities
Investments in subsidiaries - net
Investments in associates - net
Investments in related companies - net
Other long-term investments - net
Land waiting development
Investment properties - net
Property, plant and equipment - net
Leasehold rights of land and buildings - net
Goodwill
Intangible assets - net
Other assets - net
Total non-current assets
Total assets
Liabilities and shareholders’ equity
Current liabilities
Overdrafts and short-term loans from financial
institutions
Trade accounts payable and other accounts payable
Short-term loans from other companies
Long-term loans from banks stated under current
liabilities
Current portion of long-term loans
Short-term loans from related parties and accrued
interest
Other short-term loans
Current portion of obligation under debt restructuring
agreement
Deposits and advances received from customers
Provision for liabilities
Current portion of obligation under finance lease
2012
2013
Quarter
3/2014
37.85
13.22
160.16
195.36
13.77
1,267.77
100.10
75.34
260.70
0.10
62.50
0.13
55.78
0.13
-
0.13
-
0.13
0.00
24.05
131.03
9.67
379.10
3.28
572.10
62.05
2,080.77
9.16
756.98
748.09
34.67
1,872.33
50.65
44.63
45.52
509.04
299.89
0.12
124.30
109.12
97.31
151.26
79.90
0.19
111.78
118.75
93.14
162.90
93.51
2,228.66
88.97
746.48
1,936.92
722.72
1,322.38
12.81
973.53
3,605.91
47.14
2.24
0.00
0.05
0.00
162.97
817.65
80.50
3,843.23
85.86
79.31
14.10
185.99
5,319.04
2,067.95
1,701.47
5,686.68
7,191.36
-
-
-
18.61
90.53
56.24
110.49
157.33
197.55
41.08
25.20
13.12
25.20
-
45.14
-
57.64
-
112.47
646.13
-
25.00
-
25.00
5.78
14.82
724.87
-
19.36
623.03
2.12
24.30
3.88
107.19
3.75
Attachment 1 Page 5
Statement of Financial Position
2011
2012
2013
Quarter
3/2014
Income tax liabilities
Other current liabilities
Total Current Liabilities
Non-Current Liabilities
Obligation under debt restructuring agreement
Long-term loans - net
Estimated liability – employee benefit
Obligation under finance lease
Income tax liabilities
Other non-current liabilities
Total Non-Current Liabilities
10.34
1,637.48
2.44
728.37
34.16
242.97
25.38
639.30
55.32
5.81
58.58
119.71
36.41
6.79
5.73
2.40
51.33
925.49
8.65
6.31
2.40
942.84
1205.42
879.74
19.00
3.61
212.49
2.40
2322.66
Total Liabilities
1,757.19
779.70
1,185.81
2961.96
60,430.92
120,861.84
-
180,637.71
-
541,913.13
-
60,430.92
(51,688.71)
(87.43)
(8,344.08)
310.70
66,925.14
(58,053.05)
16.68
(7,967.57)
921.20
180,637.71
(168,467.96)
(0.04)
(7,671.75)
4,497.96
180,637.71
(168,467.96)
0.02
(7,942.72)
4,227.06
0.06
310.77
0.57
921.77
2.91
4,500.87
2.35
4,229
2,067.95
1,701.47
5,686.68
7,191.36
Shareholders’ Equity
Share capital
Registered
541 913 132 646 ordinary shares of THB 1 each
180 637 710 882 ordinary shares of THB 1 each
120,861,840,000 ordinary shares of THB 1 each
60,430,920,000 ordinary shares of THB 1 each
Issued and paid - up
180 637 710 882 ordinary shares of THB 1 each
66,925,140588 ordinary shares of THB 1 each
60,430,920,000 ordinary shares of THB 1 each
Discount on ordinary shares
Other components of shareholders’ equity
Deficit
Total shareholders’ equity attributable to the
Company
Non controlling interest
Total Shareholders’ Equity
Total Liabilities and Shareholders’ Equity
Source: Form 56-1, Consolidated Financial Statements of NPARK for the period ended September 30, 2014.
Attachment 1 Page 6
Statement of Comprehensive Income
(Unit: THB million)
Statement of Comprehensive Income
2011
2012
2013
Quarter
3/2014
Profit and Loss Statement
Revenue
Income from rental and services
Revenue from hotel business
Other income
Gain on sale of investments
60.34
263.11
193.12
77.04
739.49
-
94.26
92.67
577.13
-
72.28
131.85
26.31
-
Total Revenue
516.58
816.53
764.06
230.44
Expenses
Cost of rental and services
Cost of hotel business
Selling expenses
Administrative expenses
Provision for liabilities
Finance costs
Share of loss from investments in associates
50.77
3.27
273.61
58.29
46.22
192.71
56.66
6.51
163.86
77.02
18.26
117.20
56.36
90.13
15.52
187.53
9.51
81.42
27.93
40.54
124.36
45.99
205.18
84.84
-
Total Expenses
624.88
439.51
468.40
500.92
(108.30)
(0.07)
(108.37)
377.02
377.02
295.66
295.66
(270.48)
(270.48)
-
-
-
(1.05)
(11.47)
-
-
-
(211.50)
(222.97)
(331.34)
88.05
88.05
465.07
(16.72)
(16.72)
278.94
0.07
(0.99)
(271.47)
(108.31)
(0.06)
(108.37)
(327.45)
(3.88)
(331.34)
376.51
0.51
377.02
464.56
0.51
465.07
295.82
(0.16)
295.66
279.10
(0.16)
278.94
(269.92)
(0.56)
(270.48)
(270.91)
(0.56)
(271.47)
(0.0018)
0.0059
0.0021
(0.00149)
Profit (loss) before income taxes
Income tax
Profit (loss) for the year
Other Comprehensive Income
Profit (loss) from actuarial estimates
Exchange differences on translation of financial
statements
Unrealized gain on available-for-sale securities
Comprehensive Income
Total Comprehensive Income
Profit (loss) attributable to:
Owners of the parent
Non controlling interest
Total comprehensive income attributable to:
Owners of the parent
Non controlling interest
Basic profit (loss) per share attributable to the equity
of the parent
Net Profit (loss) for the year (THB/share)
Source: Form 56-1, Consolidated Financial Statements of NPARK for the period ended September 30, 2014.
Attachment 1 Page 7
Statement of Cash Flow
(Unit: THB million)
Statement of Cash Flow
2011
2012
2013
Quarter
3/2014
Cash flows from (used in) operating activities.
(211.32)
(642.81)
(977.80)
(1,099.74)
Cash flows from (used in) investing activities.
455.72
672.43
(765.44)
(56.57)
Cash flows from (used in) financing activities.
(442.82)
92.70
2,850.85
149.23
Cash and cash equivalents Increase (decrease) in
cash
(198.42)
122.32
1,107.61
(1,007.08)
Source: Form 56-1, Consolidated Financial Statements of NPARK for the period ended September 30, 2014.
Summary of Key Financial Ratios
Financial Ratios
2011
Current Ratio
(times)
2012
2013
Quarter
3/2014
0.08
0.52
8.56
2.93
Net margin
(%)
15.86
26.46
21.64
N/A*
Gross margin
(%)
(33.50)
46.17
38.70
N/A*
Return on equity (ROE)
(%)
(22.47)
61.18
10.90
N/A*
(%)
(4.27)
20.00
8.00
N/A*
5.65
0.85
0.26
0.70
Return on assets (ROA)
Debt-to-equity ratio (D / E Ratio)
(times)
Source: Form 56-1 for Natural Park Public Company Limited
Note: Non-Applicable. The Company incurred a net loss
Analysis of financial status and operating performance
Business Operational Overview 2013 and Important Events in Relation to Investment
inSubsidiaries/ Jiont Venture
In March 2013, the Company purchased ordinary shares of Prospect Development Co.,
Ltd. (“Prospect”) from the former shareholder at the rate of 13.56 percent of total paid up capital
of Prospect. Prospect engages in the business of warehouses and factories for rent, located in
Bangkok Free Trade Zone, Bangsaothong Sub-District, Samuthprakarn Province. The
Company recorded such investment at cost price and did not realize operational performance
(equity method) because Prospect is not considered as an affiliate. In October 2014, the
Company additionally acquired 6.25 percent of ordinary shares in Prospect, bringing its total
shareholding to 19.81 percent of total paid up capital of Prospect.
In April 2013, the Company invested in hotel business by purchasing total ordinary
shares of Khon Kaen Buri Co., Ltd. (“KhonKaenBuri”) from its former shareholders. Khon Kaen
Buri Co., Ltd. (“Khon Kaen Buri”) engages in hotel busniness under the name of Centatra
Convention Center Khon Kaen. As a result of purchasing of shares, operational performance of
the group of companies in 2013 started to generate income increased from hotel business at
the beginning of investment. Centatra Convention Center Khon Kaen has completely and
officially started operation from early of Decemeber 2013; as a result, income from hotel
business began to reflect actual operational performance from the end of 2013 onward.
Later in September 2013, the Company sold out total ordinary shares held in Park
Cuisine Co., Ltd. (“Park Cuisine”) at the rate of approximately 38 percent of the paid up capital.
Park Cuisine engages in management of LENOTRE restaurant for other people since Park
Cuisine has been confronting loss continuously that Park Cuisine had total of deficit over the
capital. The Company formerly realized loss equavalent to total investment according to equity
method.
In additions, in August 2013, the company has launched the first real estate project for
sell, Park Ramindhra Project which is a horizontal condominium with of 8 floors, 1 building and
Attachment 1 Page 8
206 rooms, locate on Ramindhra Road Soi 47, Bangkok with total booking as at the end of 2013
at the rate of 90 percent of total rooms. The aforesaid project will begin its construction in 2014
and expected to be finished in 2015.
In February 2014, the company has launched Park Aran Condo Project and Park Aran
Boulevard Project with total booking as at the quarter 3 of 2014 at the rate of 60 percent and
100 percent respectively of total rooms. The aforesaid project will expected to be finished in
2015 and at the end of quarter 4 of 2014 respectively.
In September 2014, the Company invested in a hotel business by acquiring the entire
ordinary shares in Boonbaramee Metta Property Co., Ltd. (“Boonbaramee”) from the existing
shareholders. Boonbaramee itself is a sole shareholder of Pacific Hotel Chiang Mai Co., Ltd.
and Pacific Chiang Mai Co., Ltd. Pacific Hotel Chiang Mai Co., Ltd. operates a hotel business
under the name, Anantara Chiang Mai Resort and Spa. Thus, with respect to the consolidated
performance, NPARK Group began to generate revenue from hotel business operation as from
the launch of such investment in 2014.
As a result, consolidated operational performance of the Company from 2013 to Quarter
3/2014 shall be comprise operational performance from real estate development for rent,
services, and hotel business only, provided that operational performance from real estate
development for sell may occur in the year when the Company realizes income in the future
thereon.
Overall Performance
Operational Performance of the Company for the period 2011-2012, the Company and
subsidiaries had derived income from the business of real estate development for rent and
services with the main income was from the Natural Park Apartment project which is an
apartment for rent whilst in 2013 income comprise of (1) income from real estate development
for rent, services business and (2) income from hotel business as in Quarter 2, the Company
invested in Centara Convention Center Khon Kaen by holding 100 percent of total shares.
Therefore, in the explanation, this shall be separated into 2 business which are real estate
development for rent, services business and hotel business.
Total Revenue
In 2013, the Company had total income of THB 764.06 million, decreased THB 52.47
million or 6.43 percent from 2012. Details are as follows.
-
Income from Services
In 2013, the Company had income from rent and related services in the amount
of THB 94.26 million, increased from 2012 equivalent to 22.36 percent as a result of
the increasing on occupancy rate of the Natural Park Apartment of the prior year by
increasing from the rate of 70 percent in 2012 to 84 percent in 2013 which was a result
of marketing strategy implement by concentration on group of companies and large
internation institutes, and embassy customers which have more purchasing power and
long term lease agreement execution. The average rate of monthly rental in 2012 is
THB 101,000 which is considered higher than average rental rate of the same area,
whilst monthly rental rate of 2013 had slightly increased to THB 103,500.
-
Revenue from Hotel Business
Revenue from hotel business in 2013 derived from the acquisition of total
ordinary shares of Khon Kaen Buri in Quarter 2 in 2013. Khon Kaen Buri carries on
hotel business under the name of “Centara Convention Center Khon Kaen” and was
managed by Centara Group of Central Plaza Hotel Public Co., Ltd. according to the
service agreement. For the beginning period of investment, the hotel was not fully
operated and was under renovation and decoration. The Centara Convention Center
Khon Kaen was fully and official operated in early of December 2013, therefore,
Attachment 1 Page 9
revenue from hotel business reflected actual operational performance from the end of
2013 onward.
In 2013, the Company had revenue from hotel business in the amount of THB
92.67 million derived from food and drink income, room rate income and others
equivalent to 65.17, 33.89, and 0.94 percent respectively of total revenue from hotel
business. The average occupation rate in 2013 is 50.20 percent.
-
Other Revenue
In 2013, the Company had other income of THB 577.13 million, decreased from
2012 which was THB 739.48 million, provided that other income in 2013 mainly derived
from
A. Profit from the debt restructuring in the amount of THB 330.25 million, 57.22
percent of other income from the repayment under Debt Restructuring
Agreement with (1.1) the receiver of Thana Nakorn finance and security
Public Co., Ltd. in March 2013, in the amount of THB 37.48 million (1.2) the
receiver of Maha Nakorn Trust Security Public Co., Ltd. in March 2013, in
the amount of THB 49.36 million and ICBC (Thai) Public Co., Ltd. (former
name Sin Asia Bank Public Co., Ltd. in June 2013, in the amounf of THB
243.43 million.
B. Profit derived from the price negotiation in investment in the Khon Kaen Buri
Co., Ltd. in the amounf of THB 164.02 million, or 28.42 percent of other
income.
While other income in 2012 mainly derived from (1) the profit from debt
restructuring with KrungThai Bank Public Co., Ltd. and Bangkok Commercial Asset
Mangement Co., Ltd. in the amount of THB 320.97 million and (2) the profit from selling
investment in the affiliate company (Kampin Siam Co., Ltd.) in the amount of THB
294.29 million, or 43.30 percent or 39.80 percent of other income, respectively.
The total revenue of the Company and its subsidiaries for the nine-month period of the
year 2014 was THB 230.44 million, decreasing by THB 441.60 million or 65.71 percent when
compared with the Company's total revenue for the nine-month period of the year 2013 which
was THB 672.04 million. Such change was resulted from the fact that the Company had gain
from debt restructuring totaling THB 330.26 million and from negotiation on acquisition totaling
THB 139.62 million in 2013. These factors, in spite of more revenue from hotel operation
totaling THB 70.26 million in 2014, resulted in decrease in 2014 total revenue of the Company.
Cost of Services
In 2013, the Company generated revenue from real estate development business for rent
in the amount of THB 56.36 million, decreased by 0.53 percent from the previous year and
equivalent to the propotion of 59.79 percent of revenue from services in 2013 which decreased
from 73.54 percent of revenue from services in 2012.
Costs of service structure were mainly fixed costs compreised of salary and welfare, land
rental, other service according to hire of work contract, e.g. gardening fee, cleaning fee and
security fee etc. including depreciation. Therefore, the costs of service was almost the same as
former year whilst the ratio of costs of service and revenue from services in 2013 decreased
from 2012 since the revenue from services in 2013 was 22.36 percent grew from 2012 as
mentioned above. As a result, gross profit margin also increased.
For the first nine months of 2014, cost of services in the real estate development for rent
business amounted to THB 40.54 million which dropped by 4.56 percent from the same period
last year.
Attachment 1 Page 10
Direct Costs of Hotel Business
The Direct costs of hotel business consisted of depreciation and amaltization, costs of
food and drink, salary and others. The depreciation and amaltize were major direct costs which
is 47.52 percent of total direct costs. The Direct costs of hotel business in 2013 are THB 90.13
million which was equivalent to 97.26 percent of total revenue.
The direct costs of hotel business in the first nine months of 2014 were THB 124.36
million which increased by THB 50.54 million or 68.46 percent from the same period last year.
The reason of such change is that Centara Convention Center Khon Kaen had just become fully
operated. Direct cost of hotel business accounts for 71.93 percent of revenue from hotel
business.
Selling and Administrative Expenses
In 2013, the Company had selling and administrative expenses in the amount of THB
203.05 million, increased by THB 32.68 million or 19.18 percent from 2012 which was THB
170.37 million. The most increasing expenses were from the investment in hotel business in
2013. However, this increasing ratio is less than the increasing of operation revenue (Real
Estate Development for rent and servicese and hotel business) in 2013, which increased by
THB 109.89 million, or 142.65 percent from 2012. The selling expenses which was increased by
THB 9.01 million was from the expenses from starting hotel business in this year, in the amount
of THB 11.35 million while the expenses of the Company decreased in the amount of THB 2.34
million resulted from the internal operating expenses. The increased operating expense in the
amount of THB 23.68 million was a result of hotel business. The selling and administrative
expenses structure for 2013 was selling expenses, 7.64 percent and administrative expenses,
92.36 percent of all selling and administrative expenses. The operating expenses structure
mainly consisted of salary, director allowance, consulting fee, audit fee, fee paid to SET and
others etc. While the selling and administrative expenses structure of 2012 was selling
expenses, 3.82 percent and administrative expenses, 96.18 percent of total selling and
adimistrative expenses.
For the first nine months of 2014, the Company recorded selling and administrative
expenses of THB 251.18 million, soared by THB 103.78 million or 70.41 percent year-on-year.
Selling expense was THB 45.99 million, increased by THB 36.76 million or 397.82 percent from
the same period last year and administrative expense was THB 205.16 million, increased by
THB 67.03 million or 48.51 percent compared to the same period last year.
Gross Profit from operation
Real Estate Development for Rent and Services
In 2013, gross profit margin of this business equivalent to THB 37.91 million in 2013,
increase to 85.97 percent and gross profit margin rate increased to 40.21 percent in 2013 from
26.46 percent in 2011.
For the first nine months of 2014, the Company recorded gross profit of this business of
THB 31.74 million, increased by 16.22 percent compared to the same period last year and had
an increase in gross profit margin to 43.91 percent from 39.13 percent from the same period
last year.
Hotel Business
The Company had gross profit margin THB 2.54 million or 2.74 percent of total revenue
from hotel business. Since the Company had fixed cost i.e. depreciation and amaltization
expenses and salary but the hotel was not fully operated, as a result, the cost of services for the
first year operation was quite high.
For the first nine months of 2014, the Company recorded gross profit of hotel business
of THB 7.49 million, accounting for 5.68 percent of revenue from hotel business. Because two
hotels have been fully operated and cause a higher operationg cost.
Attachment 1 Page 11
Net Profit (Loss)
In 2013, the Company had net profit in the amount of THB 295.66 million (devided into
profit of Equity shareholders in the amount of THB 295.82 million and Equity of Related persons
who have no control in subsidiary company (realized loss) in the amount of Baht (0.16) million),
decreased from previous year in the amount of THB 81.36 million or 21.58 percent which is a
part of profit from selling investment in affiliated company (Kampin Siam Co., Ltd.) occred in
2012 in the amount of THB 294.29 million and financial cost which was increased from the
starting of hotel business in the amount of THB 63.61 million although, in 2013 the Company
had profit from the price negotiation in investment in Khon Kaen Buri Co., Ltd. in the amount of
THB 164.02 million and estimiated liability which was decreased by THB 67.51 million.
For the first nine months of 2014, the Company recorded a net loss of THB 270.48
million. This loss is attributable to shareholders of THB 269.92 million and non-controlling
interest of THB 0.56 million.
Financial Status
Assets
As of 31 December 2013, the Company had total assets in the amount of THB 5,686.68
million, increased by 234.22 percent from ending of 2012 as a consequence of (1) Land
Building and Equipment from the starting of hotel business operation which increased in the
amount of THB 2,109.91 million, or 52.94 percent of the increased total asset (2) Cash and
Cash equivalent which increased in the amount of THB 1,107.61 million, or 27.79 percent of the
increased total asset as a result of capital increase in 2013, and (3) Real Estate Project under
development which increased in the amount of THB 572.10 million or 14.36 percent of the
increased total asset which consisted of Land, Land improvement, Construction cost and
project expenses for The Park Ramintra (Start selling in 2013) and Project waiting development
for 3 projects i.e. The Park Aran Condo, The Park Aran Boulevard which will start selling in
2014 and the project under study.
The Company’s asset structure at ending of 2013 consisted of non current assets, and
current assets, 63.41 and 36.59 percent, respectively.
The major non current asset consisted of (1) Net Land Building and Equipment (mostly
assets of hotel business) and (2) The other non current asset (mostly waiting development),
39.19 and 17.12 percent of total asset, respectively.
The major current asset consisted of (1) Cash and cash equivalent and (2) Real Estate
Project under development, 22.29 and 10.06 percent of total asset, respectively.
As of September 30, 2014, the Company had total assets of THB 7,191.36 million,
growing by 26.46 percent from the end of 2013. Such asset growth was mainly ascribed to an
increase in land, building and equipment of THB 1,614.56 million or 72.45 percent of the
increased asset value.
Liabilities
As of 31 December 2013, the total liabilities of the company were in the amount of THB
1,185.81 million, increased by 52.09 percent from ending of 2012. The increased liabilities were
mainly from the increase of long-term loan in hotel business, approximately THB 929.64 million
and account payable in the amount of THB 54.28 million or increased by 218.93 and 13.37
percent of the increased total liabilities. However, the Company had already repaid debt under
Debt Restructuring Agreement with creditor which recorded as accured expenses in 2013 as a
result, this estimated liabilities was not further appeared in balance sheet at the end of 2013
(estimated liabilities at the end of 2012 in the amount of THB 623.03 million)
The liability structure of the Company at the end of 2013 consisted of non-current
liabilities and current liabilities, 79.51 and 20.49 percent of total liabilities, respectively.
Attachment 1 Page 12
The almost of non-current liabilities was long term loan for hotel business, 78.05 percent
of total liabilities.
Almost of current liabilitiese consisted of (1) Account payable and other creditor and (2)
long term loan due within one year, 9.32 and 3.81 of total liabilities, respectively.
As of September 30, 2014, the Company had total liabilities of THB 2,961.96 million,
mounting by 149.78 percent from year-end 2013. Such dramatic increase largely came from a
surge in non current liabilities such as long-term loan for hotel business of around THB 1,205.42
million and income tax liabilities of THB 212.49 million and current liabilities such as short term
loans from other companies of THB 197.55 millions.
Shareholders’equity
As of 31 December 2013, the Company had shareholders’ equity in the amount of THB
4,500.87 million, increased by 388.29 which strengthened the Company’s financial status in
comparation with the previous year. The increased shareholders’ equity was from increase in
capital in the amount of THB 3,297.66 million Baht and net profit in 2013 in the amount of THB
295.82 million provided. The Company still had deficit in the amount of THB 6,991.05 million
(Specific Buiness Financial Statement), therefor the Company could not distribute dividend to
shareholders according to the law.
As of September 30, 2014, the Company had total shareholders’ equity of THB 4,229.41
million, decreased by THB 271.47 million or 6.03 percent from year-end 2013.
Liquidity
Cash and Cash equivalents
The Company’s cash and cash equivalent brought forward from 2012 was THB 160.16
million. The Company have cash used in operating activities in the amount of THB 977.80
million, cash used in investment activities in the amount of THB 765.44 and cash received from
investment activities in the amount of THB 760.44 million and cash received from fund raising
activities in the amount of THB 2,850.85 milllion, therefore in 2013 cash flow was increased by
THB 1,107.61 million causing cash and cash equivalent at the end of 2013 equal to THB
1,267.77 provided that significant cash received was cash increased from selling of increase on
capital ordinary shares in the amount of THB 3,297.66 million.
According to the Company’s operating activities in 2013, the Company had loss from
operation before change of assets and liabilities in the amount of THB 72.72 million and the
Company used most of cash flow in real estate development project in the amount of THB
572.09 million and acquisition of land awaiting development and building in the amount of THB
219.29 million.
According to investment activities in 2013, the Company used most of cash in acquisition
of investments property, building and equipment in the amount of THB 162.71 million, total cash
paid for acquisition of subsidiaries in the amount of THB 577.54 million, acquisition of long-term
investment in the amount of THB 162.74 million, advance cash paid for share capital in the
amount of THB 187.50 million.
According to fund raising activities in 2013, the Company had cash flow received from
capital increase in the amount of THB 3,297.66 million and other short-term loans in the amount
of THB 25.00 million whilst cash flow paid was paid for liabilities under debt restructuring in the
amount of THB 302.29 million and cash flow paid for long-term loans to financial institutes and
long-term loan from direcotrs in the amount of THB 169.53 million provided that the Company
have not distributed dividends to the shareholders.
As of September 30, 2014, the Company had a decrease in net cash flow of THB
1,007.08 million. This is attributable to Cash used in operating activities of THB 1,099.74 million,
Cash used in investment activities of THB 56.57 million and Cash received form fund raising
activities of THB 149.23 million.
Attachment 1 Page 13
6. Industry Outlook
Serviced Apartment Business
Bangkok’s serviced apartment market has grown slowly in the last few years, due to fierce
competition following the mushrooming of condominium along the BTS line. Serviced
apartments in Bangkok saw declining growth rate since 2009 and will continue to exhibit this
declining trend due chiefly to both soaring land prices and the changing preferences of foreign
tourists and expats, who make up the bulk of the market. However, occupancy and rental rates
of the second quarter of 2014 went up slightly.
The total supply of serviced apartments in Bangkok is approximately 18,280 units in the
second quarter of 2014 and expected to increase to 18,720 units at the end of 2014. Sukhumvit
Road remains the most popular area for developers and lessees, with higher occupancy and
rental rates than other locations.
Although the number of foreigners granted work permit to work in Bangkok continued to
increase in the past few years, they have many residential options. Condominiums and serviced
apartments along the BTS lines in Sukhumvit Road, which offers various facilities apart from
convenient transportation, are mostly popular. The upper Sukhumvit area had highest
occupancy and rental rates of the second quarter of 2014.
The serviced apartment market at present has intense competition because of increasing
of new apartment and condominium projects. Most expatriates working in Bangkok prefer to
stay outside a business district, but not a distance from the BTS or MRT, at lower rental rates.
However, the implementation of the Asean Economic Community in 2015 will allow more
foreigners to work in Thailand which will be the positive factor to drive serviced apartment
market in the future.
Source: Colliers International (Thailand)
Hotel Business
The overall hotel market in Thailand in the first half of 2014 was still flat. Tourist
confidence has been negatively affected by the continuing political turmoil that arose at the end
of 20131, evidence of this can be seen from the number of visitor arrivals to Thailand in the
second quarter of 2014, THB 5.25 million, a decrease of 13.35 percent year-on-year. The
hotel’s occupancy rate in this quater is 47.37 percent, a decrease of 21.43 percent year-onyear. The Central region including Bangkok was the hardest hit with adecrease of 29.08 percent
year-on-year, followed by the South, with a decrease of 10.91 percent.
The decreasing occupancy rate has affected average room rates, which are limited
because of price strategy and intense competition in the market and indirect competitors such
as serviced apartments and condominiums.
The average actual room rate in the second quarter of 2014 for Thailand is Baht 1,736 per
night, an increase of 0.12 percent year-on-year. The South had highest actual room rate and
increase in rate, the actual room rate was THB 2,138 per night, representing an increase of
5.58 percent year-on-year. Central including Bangkok recorded the second highest actual room
rate at Baht 1,758 per night, a decrease of 3.24 percent compared to the previous year. The
average room rates in the North and North-East of Thailand were THB 1,269 and THB 897 per
night, representing year-on year increases of 3.95 percent and 2.04 percent, respectively.
The tourism trend in the second half of year 2014 and 2015 will be improved resulted from
the unfolding of political problem and the stable of government that enhance tourist confidence
and government's tourist promotion policy. The Tourism Authority of Thailand (TAT) set the
revenue target of THB 2.2 trillion.
1
Source: Bank of Thailand as of October 13, 2014
Attachment 1 Page 14
Attachment 2
Financial Status and Operating Results of
BTS Assets Company Limited
1.
General Information
Name
: BTS Assets Company Limited (“BTSA”)
Type of Business
: Real Estate Development composed of
1)
2)
3)
Real estate development for sale
Real estate development for rent
Hotel and service
Phone Number
: 0-2273-8511-5
Fax Number
: 0-2273-8516
Address
: 21 Soi Choeypuang, Viphavadeerangsit Road, Jompol, Chatuchak,
Bangkok 10900
Registered Capital
: THB 800,000,000 (As of 24 November 2014)
Divided into 8,000,000 ordinary shares with a par value of THB 100 per
share
Paid-up Capital
: THB 800,000,000 (As of 24 November 2014)
Divided into 8,000,000 ordinary shares with a par value of THB 100 per
share
2.
Nature of Business
2.1
Background
BTS Assets Company Limited (“BTSA”) was founded on June 12, 1986, formerly held by
Bangkok Mass Transit System Public Company Limited (“BTSC”). But on February 15, 2011
there was a restructuring of group’s shareholders in property business. BTS Group holdings
public company limited (“BTSG”) had acquired all BTSA’s shares and become the major
shareholder of BTSA.
BTSA’s main business is hotel and property development. The hotel under operation is
the Eastin Grand Sathorn which is a 4-star hotel with 390 rooms located on Sathorn road in the
CBD district near the Surasak BTS skytrain station. The Hotel is a 33 storey structure occupying
2-1-57 Rai or 957 square wah. The hotel commenced its commercial operation since May 2014
and the occupancy for the year starting from April 2013 – March 2014 was approximately
80.13% and for the period of 5 months starting from April 2014 – August 2014 was
approximately 70.81%. Eastin Grand Sathorn has been operated by Absolute hotel service Co.,
Ltd which is is a joint venture company between BTSG and partners with experience in the
hotel business
Additionally, BTSA has 63 vacant landplots located on Phaholyothin Road, Chatuchak,
Bangkok totaling 11 – 0 – 44.8 Rai or 4,444.8 sq.Wah that can be used for development. BSTA
will transfer a 5-0-15.70-rai plot of land located on Phahonyothin, near BTS Mo Chit Station, to
an entity jointly controlled by BTSG and other companies before the closing date. In addition,
BTSA will make a cash provision for corporate income tax related to the sale of the land.
Attachment 2 Page 1
Details of asset are as follow:
Type of Assets
Details
1. Land with 33-fl.
Hotel Building
-
Title deed No.2709 Parcel No. Parcel No. 56 Dealing File No. 403
Located at Sathorn, Bangrak, Bangkok
Area of land 2-1-57 Rai or 957 Square Wah
Date on Land Sale Agreement 15 July 1987
Operate for “Eastin Grand Hotel Sathorn Bangkok”
2. Land
-
63 Land Parcels, Area of land 11-0-44.8 Rai or 4,444.8 Square Wah
Located at Latyao (North Bang Sue), Bang Khen (Bang Sue), Bangkok
Title deed No. 4858, 14375, 14377, 14378, 88720, 88721, 88814, 88839, 88855, 88856,
88857, 88858, 88859, 88860, 88861, 88862, 88863, 88864, 88865, 88894, 88895, 88896,
88897, 88898, 126232, 126235, 126237, 12872, 134273, 140008, 140009, 141625,
141626, 141627, 88900, 88901, 88902, 88914, 88916, 88917, 88918, 88919, 88920,
88921, 88922, 88923, 88924, 88929, 88930, 88932, 88962, 88963, 88964, 88965,
126572, 129742, 129743, 129744, 129745, 129746, 129747, 12948, 12949
2.2
Revenue Structure
BTSA main revenue comprised of revenue from hotel operations. The revenue structures of BTSA in 2012 –
nd
2014 and 2 quarter of 2015 are as follows.
2011/12*
THB
Interest income
Others
Quarter 2/2015
THB
%
THB
%
THB
%
0.00
382,191,859
89.24
588,283,120
85.79
213,929,527
83.54
5.11
36,600,000
8.55
72,573,012
10.58
35,286,820
13.78
0.00
-
0.00
-
0.00
-
0.00
150,000,000
93.69
-
0.00
-
0.00
-
0.00
1,004,576
0.63
332,152
0.08
274,803
0.04
114,125
0.04
910,335
0.57
9,168,414
2.14
24,582,185
3.58
6,752,519
2.64
8,180,000
Other revenue
Gain on transfer of
investments in
subsidiaries to debt
settlement
2013/14
%
Revenue from Hotel
business
Income from services
2012/13
Source: Financial Statement of BTS Assets Company Limited
Remark: In 2012 BTSA changed the accounting period from 1 January – 31 December to 1 April – 31 March
3.
List of Shareholders
List of shareholders as of 24 November 2014
No.
1.
Name of Shareholders
BTS Group Holdings Public Company Limited
Number of Shares
(Shares)
% Shareholding
7,999,998
100.00
0.00
2.
Mr. Keeree Kanjanapas
1
3.
Mr. Surapong Laoha-unya
1
0.00
8,000,000
100.00
Total
Source: Form Bor Or Jor 5 of BTSA
Attachment 2 Page 2
4.
List of Directors
List of BTSA’s Board of Directors as of November 24, 2014 are as follows.
No.
1.
2.
3.
4.
5.
6.
7.
Name of Directors
Mr. Tong Yuk Lun Paul
Mr. Kawin Kanjanapas
Mr. Chi Kueng Kong
Mr. Rangsin Kritalug
Mr. Kom Phanomreungsak
Mr. Chaisit Phurapiromkwan
Mr. Low Yun Sam
Position
Director
Director
Director
Director
Director
Director
Director
Source: Company affidavit of BTSA
5.
Summary of Financial Highlights and Analysis of Operational Performance
and Financial Status of BTSA
Statement of Financial Position
(Unit: THB Million)
Statement of Financial Position
Assets
Current Asset
Cash and Cash Equivalent
Accounts receivable and other receivable
Inventories
Refundable value added tax
Other current assets
Total current assets
Non-current Asset
Pledged bank deposit
Investment properties
Property, plant and equipment
Land held for development
Intangible assets
Advances to contractor
Advances for asset acquisitions
Other non-current assets
Total non-current assets
Total assets
Liabilities and shareholders' equity
Current Liabilities
Account Payable and other payable
Short-term loans from a financial instituition
Current portion of long-term loans
Other current liabilities
Total Current Liabilities
Non-current Liabilities
Long Term Loan from Parent
As of 31 March
As of 30
September
2012
2013
2014
17.13
5.74
9.91
92.47
18.41
143.66
22.86
18.79
14.42
103.44
8.45
167.97
33.35
72.55
11.19
68.35
13.46
198.90
27.37
76.69
9.82
55.01
9.71
178.60
725.69
2,204.33
370.22
43.96
5.74
2.89
3,342.82
1,116.24
2,468.79
4.60
8.05
13.36
3,611.04
1,267.55
2,389.79
2.68
6.26
3,666.28
1,254.20
2,353.96
2.26
4.86
3,615.28
3,486.48
3,779.01
3,865.18
3,793.87
255.41
200.00
1.40
456.81
177.76
1,000.00
8.08
1,185.83
297.84
6.79
304.63
333.45
4.46
337.91
765.20
2,120.50
3,299.50
3,254.50
Attachment 2 Page 3
2014
Statement of Financial Position
As of 31 March
As of 30
September
2012
2013
2014
2014
Long Term Loan from bank
Performance guarantee payable
Provision for employee long-term benefit
Other non-current liabilities
Total Non-current Liabilities
1,609.32
91.02
14.35
0.60
2,480.49
107.75
22.31
0.70
2,251.26
7.92
28.53
0.11
3,336.07
6.83
28.55
1.71
3,291.60
Total Liabilities
2,937.30
3,437.09
3,640.70
3,629.52
Shareholder's equity
Share capital
Registered capital
8,000,000 ordinary shares of Baht 100 each
Issued and Fully Paid-up Share capital
8,000,000 ordinary shares of Baht 100 each
Retained earnings (deficit)
Total shareholders'equity
800.00
800.00
800.00
800.00
800.00
(250.82)
549.18
800.00
(458.09)
341.91
800.00
(575.51)
224.49
800.00
(635.64)
164.36
Total Liabilities and shareholders' equity
3,486.48
3,779.01
3,865.18
3,793.87
Source: Financial Statement of BTS Assets Company Limited
Remark: In 2012 BTSA changed the accounting period from 1 January – 31 Decomber to 1 April – 31 March
BTSG will increase capital in BTSA to pay in full all long-term debts borrowed from the parent company. As a result, on the
closing date, BTSA will have assets, and liabilities in the form of accounts payable, deferred expenses, provision for
employee long-term benefit, and performance guarantee payable, which are all liabilities from normal business operation.
Statement of Comprehensive Income
(Unit: THB Million)
Statement of Comprehensive Income
As of 31 March
2012
6 Months
period As of
30 September
2013
2014
8.18
382.19
36.60
588.28
72.57
213.93
35.29
150.00
-
-
-
1.00
0.91
0.33
9.17
0.27
24.58
0.11
6.75
Total Revenues
160.09
428.29
685.71
256.08
Expenses
Cost from hotel operations
Selling expenses
Servicing and administrative expenses
Total expenses
Profit (loss) before finance cost
Finance cost
64.19
64.19
95.91
(18.17)
202.24
21.09
298.91
522.24
(93.95)
(113.32)
278.95
24.02
371.01
673.98
11.74
(129.16)
104.79
8.99
159.89
273.66
(17.58)
(42.55)
77.74
(207.27)
(117.43)
(60.13)
Revenue
Revenue from hotel operations
Service income
Other income
Gain on transfer of investments in subsidiaries to debt
settlement
Interest income
Others
Net profit (loss) for the year
Source: Financial Statement of BTS Assets Company Limited
Remark: In 2012 BTSA changed the accounting period from 1 January – 31 Decomber to 1 April – 31 March
Attachment 2 Page 4
2014
Summary of Key Financial Ratios
As of 31 March
Financial Ratios
2012
Current Ratio
Gross Profit Margin
2013
As of 30
September
2014
2014
(Times)
0.31
0.14
0.65
0.53
(%)
59.91
(21.94)
1.71
(6.86)
Net Profit Margin
(%)
48.56
(48.39)
(17.12)
(23.48)
Return on Equity (ROE)
(%)
14.16
(60.62)
(52.31)
(36.58)
Return on Assets (ROA)
(%)
2.23
(5.48)
(3.04)
(1.58)
(Times)
5.35
10.05
16.22
22.08
Debt to Equity Ratio (D/E Ratio)
Source: Financial Statement of BTS Assets Company Limited and calculated by Independent Financial Advisers
Analysis of financial status and operating performance
Overall Preformance
Total Revenue
BTSA main revenue comprised of revenue from hotel operations and revenue from
service. In addition, other incomes, such as interest revenue, were in proportion of 3-4% of total
revenue approximately.
In 2012/2013, BTSA earned total revenue of THB 428.29 million which can not compare
with the previous year because BTSA changed accounting period from 1 January – 31
Decomber to 1 April – 31 March in 2012, as following details.
-
Revenue from hotel operations of Baht 382.19 million.
Revenue from service of Baht 36.60 million.
Other revenue of Baht 9.50 million.
In 2013/2014, BTSA earned total revenue of THB 685.41 million increased by THB 257.42
million or 6.10% compared with the previous year as following details.
-
Revenue from hotel operations of THB 588.28 million, increased by THB 206.09 million
or 53.92% compared with the previous year.
Revenue from service operations of THB 72.57 million, increased by THB 35.97 million
or 98.29% compared with the previous year.
Other revenue of THB 24.86 million, increased by THB 15.36 million or 161.64%
compared with the previous year.
For the first six month of 2014/15, BTSA earned total revenue of THB 256.08 million,
comprised of revenue from hotel operations of THB 213.93 million, revenue from service of
THB 35.29 million and other revenue of THB 6.87 million.
Operating Expenses
BTSA operating expenses comprised of hotel direct expense, selling expense and general
and admin expense.
In 2012/13, operating expenses of BTSA were THB 522.24 million which can not compare
with the previous year because BTAS changed accounting period from 1 January – 31
Decomber to 1 April – 31 March in 2012, as following details.
-
Hotel direct expense of THB 202.24 million.
Selling expense of THB 21.09 million.
General and admin expense of THB 298.91 million.
Attachment 2 Page 5
In 2013/14, operating expenses of BTSA were THB 673.98 million, increased by THB
151.73 million, or 29.05% from 2012/2013 as following details.
-
Hotel direct expense of THB 278.95 million, increased by THB 76.71 million, or 37.93%
compared with the previous year.
Selling expense of THB 24.02 million, increased by THB 2.93 million, or 13.87%
compared with the previous year.
General and admin expense of THB 371.01 million, increased by THB 72.10 million, or
24.12% compared with the previous year.
For the first six month of 2014/15, operating expenses of BTSA were THB 273.66 million,
comprised of hotel direct expense of THB 104.79 million, selling expense of THB 8.99 million
and general and admin expense of THB 159.89 million.
Net Profit (Loss)
In 2012/13, BTSA net loss was THB 207.27 million, which can not compare with the
previous year because BTSA changed accounting period from 1 January – 31 Decomber to
1 April – 31 March in 2012.
In 2013/14, BTSA net loss was THB 117.43 million, decreased for THB 89.84 million from
previous year as a result of the increasing of operating performance. The loss before financial
costs was THB 11.74 million.
For the first six month of 2014/15, BTSA net loss was THB 60.13 million, which was loss
before financial costs THB17.58 million.
Financial Status
Assets
Major assets of BTSA are non-current assets which consist of property, plant and
equipment and investment properties.
At the end of 2012/13 BTSA had total assets of THB 3,779.01 million, increased by THB
292.53 million or 8.39% from 2012 which had total assets of THB 3,486.48 million. Major assets
were non-current assets totaling THB 3,611.04 million, and comprised of property, plant and
equipment of THB 2,468.79 million and investment properties of THB 1,116.27 million. While
current assets stood at THB 167.97 million.
At the end of 2013/14 BTSA had total assets of THB 3,865.18 million, increased by THB
86.18 million or 2.28% from 2013. Major assets were non-current assets totaling THB 3,666.28
million, and comprised of property, plant and equipment of THB 2,389.79 million and investment
properties of THB 1,267.55 million. While current assets stood at THB 198.90 million.
For the first six month of 2014/15, BTSA had total assets of THB 3,793.87 million,
decreased by THB 71.31 million or 1.84 from 2014. Major assets were non-current assets
totaling THB 3,615.28 million, and comprised of property, plant and equipment of THB 2,353.96
million and investment properties of THB 1,254.20 million. While current assets stood at THB
178.60 million.
Liabilities
At the end of 2012/13, BTSA had total liabilities of THB 3,437.09 million, increased of
THB 499.79 million or 17.02% from at the end of 2012, which had total liabilities of THB
2,937.30 million. The increase of total liabilities in 2013 was mainly from the increase of long
term loan from parent. Major Liabilities in 2013 were non-current liabilities totaling THB 2,251.26
million, comprised of long term loan from parent of THB 2,120.50 million and performance
guarantee payable of THB 107.75 million and provision for employee long-term benefit of THB
22.31million.While current assets stood at THB 1,185.83 million, increased from current portion
of long-term loans of THB 1,000 million.
Attachment 2 Page 6
At the end of 2013/14, BTSA had total liabilities of THB 3,640.70 million, increased of
THB 203.60 million or 5.92% from at the end of 2013. The change mainly resulted from a
decrease in current liabilities from current portion of long-term loans of THB 1,000 million and
an increase in non-current liabilities from long term loan from parent of THB 1,179 milion. Major
liabilities in 2014 were non-current liabilities totaling THB 3,336.07 million, comprised of long
term loan from parent of THB 3,299.50 million and provision for employee long-term benefit of
THB 28.53 million.While current assets stood at THB 304.63 million, consisted of account
payable and other payable of THB 297.84 million and other current liabilities of THB 6.79
million.
For the first six month of 2014/15, BTSA had total liabilities of THB 3,629.52 million,
decreased of THB 11.18 million or 0.31% from at the end of 2014. Major liabilities were noncurrent liabilities totaling THB 3,291.60 million, comprised of long term loan from parent of THB
3,254.50 million and provision for employee long-term benefit of THB 28.55 million.While
current assets stood at THB 337.91 million, consisted of account payable and other payable of
THB 333.45 million and other current liabilities of THB 4.46 million.
Shareholders’ Equity
At the end of 2013, BTSA had total shareholders’ equity of THB 341.91 million,
decreased of THB 202.27 million or 37.74% from at the end of 2012 which had total
shareholders’ equity of THB 549.18 million, resulted from the entire net loss in 2013.
At the end of 2014, BTSA had total shareholders’ equity of THB 224.49 million,
decreased of THB 117.43 million or 34.34% from at the end of 2013, resulted from the entire
net loss in 2014.
For the first six month of 2014/15, BTSA had total shareholders’ equity of THB 164.36
million, decreased of THB 6.12 million or 26.78% from at the end of 2014, resulted from the
entire net loss in 2014.
6.
Industry Outlook of Hotel Business
The overall hotel market in Thailand in the first half of 2014 was still flat. Tourist
confidence has been negatively affected by the continuing political turmoil that arose at the end
of 20131, evidence of this can be seen from the number of visitor arrivals to Thailand in the
second quarter of 2014, THB 5.25 million, a decrease of 13.35 percent year-on-year. The
hotel’s occupancy rate in this quater is 47.37 percent, a decrease of 21.43 percent year-onyear. The Central region including Bangkok was the hardest hit with adecrease of 29.08 percent
year-on-year, followed by the South, with a decrease of 10.91 percent.
The decreasing occupancy rate has affected average room rates, which are limited
because of price strategy and intense competition in the market and indirect competitors such
as serviced apartments and condominiums.
The average actual room rate in the second quarter of 2014 for Thailand is THB 1,736 per
night, an increase of 0.12 percent year-on-year. The South had highest actual room rate and
increase in rate, the actual room rate was Baht 2,138 per night, representing an increase of
5.58 percent year-on-year. Central including Bangkok recorded the second highest actual room
rate at Baht 1,758 per night, a decrease of 3.24 percent compared to the previous year. The
average room rates in the North and North-East of Thailand were THB 1,269 and THB 897 per
night, representing year-on year increases of 3.95 percent and 2.04 percent, respectively.
The tourism trend in the second half of year 2014 and 2015 will be improved resulted from
the unfolding of political problem and the stable of government that enhance tourist confidence
and government's tourist promotion policy. The Tourism Authority of Thailand (TAT) set the
revenue target of THB 2.2 trillion.
1
Source: Bank of Thailand as of October 13, 2014
Attachment 2 Page 7
Attachment 3
Financial Status and Operating Results of
Kamkoong Company Limited
1. General Information
Name
:
Kamkoong Company Limited (“KKP”)
Type of Business
:
Real Estate Development
(At the present, the Company has not engaged in any
development but has 9 plots of land)
Address
:
Registered Capital
:
21 Soi Choeypuang, Viphavadeerangsit Road, Jompol,
Chatuchak, Bangkok 10900
THB 375,000,000 (As of 24 November 2014)
Divided into 3,750,000 ordinary shares with a par value of THB
100 per share
Paid-up Capital
:
THB 375,000,000 (As of 24 November 2014)
Divided into 3,750,000 ordinary shares with a par value of THB
100 per share
2. Nature of Business
Kamkoong was established for the purpose of property development. However, as of
present, the ompany has not engaged in any development but has 9 plots of land, located on
Phayathai road, Phayathai, Ratchthewi, Bangkok totaling 5-0-0.42 Rai or 2,000.42 sq.Wah
(including plots of land pending transfer, totaling 18 plots with a combined area of 6-2-31.40
Rai, or 2,631.40 sq. wah.), that can be used for development.
The Company and BTSG will determine the Final Selling Price of Kamkoong shares in
accordance with the area of lands on Phayathai Road, near BTS Phayathai Station, owned by
Kamkoong, before the closing date.
Type of Assets
Details
Land
1) Lands on Phayathai Road 8 plots with total area of 4-1-62.4 rai (or 1,762.4 sq. wah)
(“Group 1 Land”)
2) Lands on Phayathai Road that are in the processing of acquiring by KKP with a nonrelated third parties. Theses plots are situated adjacent next to Group 1 Land. The
total area of these 10 plots is 2-0-69 rai (or 869 sq. wah) (“Group 2 Land”) And KKP,
so far already owned one of the plots of the area 0-2-38 rai (or 238 sq. wah). The
expected completion of acquisition will be prior to the Closing Date
3. List of Shareholders
List of shareholders as of 24 November 2014
No.
1.
Name of Shareholders
Number of Shares
(Shares)
BTS Group Holdings Public Company Limited
% Shareholding
3,749,997
100.00
2.
Mr. Keeree Kanjanapas
1
0.00
3.
Mr. Surapong Laoha-unya
1
0.00
4.
Mr. Natasak Chaichana
1
0.00
Total
3,750,000
Source: Form Bor Or Jor 5 of KKP
Attachment 3 Page 1
100.00
4. List of Directors
List of KKP’s Board of Directors as of October 3, 2014 are as follows.
No.
Name of Directors
Position
1.
Mr. Keeree Kanjanapas
2.
Mr. Surapong Laoha-unya
Director
Director
3.
Mr. Anat Arbhabhirama
Director
4.
Mr. Kavin Kanjanapas
Director
5.
Mr. Rangsin Kritalug
Director
6.
Mr. Kom Phanomreungsak
Director
Source: Company affidavit of BTSA
5. Summary of Financial Highlights and Analysis of Operational Performance and
Financial Status of KKP
Statement of Financial Position
(Unit: THB)
Statement of Financial Positon
As of 31 March
2012
2013
As of 30
September
2014
2014
Assets
Current Asset
Cash and Cash Equivalent
Other receivable
Refundable value added tax
Other current assets
Total current assets
Non-current Asset
Deposit for purchase of Land
Land held for development
Investment properties
Total non-current assets
727,747
300,300
770,477
4,258
1,802,782
15,812
770,179
12
786,003
213,778
770,179
42,613
1,026,570
230,518
770,179
14,271
1,014,968
510,387,215
510,387,215
510,387,215
510,387,215
510,387,215
510,387,215
20,000,000
510,387,215
530,387,215
Total assets
512,189,997
511,173,218
511,413,785
531,402,183
Liabilities and shareholders' equity
Current Liabilities
Other Payable
Other current liabilities
Total Current Liabilities
Non-current Liabilities
Long Term Loan from Parent
Total Non-current Liabilities
918,545
456,978
1,375,523
6,533,839
600
6,534,439
12,452,191
900
12,453,091
14,516,507
900
14,517,407
148,767,811
148,767,811
149,150,000
149,150,000
158,270,000
158,270,000
178,520,000
178,520,000
Total Liabilities
150,143,334
155,684,439
170,723,091
193,037,407
Shareholder's equity
Share capital
Registered capital
3,750,000 ordinary shares of Baht 100 each
Issued and Fully Paid-up Share capital
3,750,000 ordinary shares of Baht 100 each
Retained earnings (Deficit)
Total shareholders'equity
375,000,000
375,000,000
375,000,000
375,000,000
375,000,000
(12,953,337)
362,046,663
375,000,000
(19,511,221)
355,488,779
375,000,000
(34,309,306)
340,690,694
375,000,000
(36,635,224)
338,364,776
Total liabilities and shareholders' equity
512,189,997
511,173,218
511,413,785
531,402,183
Attachment 3 Page 2
Source:
Financial Statement of Kamkoong Property Company Limited
Remark:
KKP will increase capital in Kamkoong to pay in full all long-term debts borrowed from the parent company. As a result,
on the closing date, Kamkoong will have assets, and liabilities in the form of accounts payable, deferred expenses,
provision for employee long-term benefit, and performance guarantee payable, which are all liabilities from normal
business operation, and borrowing for land deposit.
Statemenet of Comprehensive Income
(Unit: THB)
Statement of Comprehensive Income
As of 31 March
2012
As of 30
September*
2013
2014
2014
Revenue
Interest earnings
Total Revenues
Expenses
General and Admin Expense
Total Expenses
Profit (Loss) before Financial Costs
Financial Costs
5,229
5,229
1,234
1,234
271
271
471
471
2,012,293
2,012,293
(2,007,064)
(7,343,079)
687,601
687,601
(686,367)
(5,871,517)
8,874,654
8,874,654
(8,874,383)
(5,923,702)
215,673
215,673
(215,202)
(2,110,716)
Net Profit (Loss)
(9,350,143)
(6,557,884)
(14,798,085)
(2,325,918)
Source:
Financial Statement of KKP
Remark: Accounting Period of KKP is 1 April – 31 March
*Data from internal financial statement of KKP, which has been reviewed by the auditor of KKP but not issued. And KKP
did not prepared statement of cash flow
Summary of Key Financial Ratio
As of 31 March
Financial Ratio
2012
Current ratio
Gross profit margin
(time)
2013
As of 30
September
2014
2014
1.31
0.12
0.08
0.07
-
-
-
-
(%)
Net profit margin
(%)
-
-
-
-
Return on equity (ROE)
(%)
(2.58)
(1.84)
(4.34)
(0.69)
(%)
(1.83)
(1.28)
(2.89)
(0.44)
0.41
0.44
0.50
0.57
Return on assets (ROA)
Debt to equity ratio (D/E Ratio)
(time)
Source: Financial Statement of KamkoongProperty Company Limited and calculated by Independent Financial Advisers
Remark: Accounting Period of KKP is 1 April – 31 March
Analysis of financial status and operating performance
Overall Preformance
KKP has not yet operated or launched any projects; there were only assets and
liabilities.
Revenue
Due to KKP has not yet operated or launched any project, there were no revenues from
operations. The only source of income was from interest revenue.
In 2012/13 KKP had total revenues of THB 1,234 decreased by THB 3,995 or 76.40%
compared with that of 2011/2012. In 2013/14 KKP had total revenues of THB 271 decreased by
THB 963 or 78.04% compared with that of 2012/13. For the six month of 2014/15, KKP had
total revenue of THB 471.
Attachment 3 Page 3
Operating Expense
As same as revenues, since KKP has not yet operated, the expenses of KKP were
general and admin expense.
In 2012/13 KKP had general and admin expense of THB 687,601 decreased by THB
1,324,692 or 65.83% compared with that of 2011/12. In 2013/2014 KKP had general and admin
expense of THB 8,874,654 increased by THB 8,187,053 or 1,190.67% compared with that of
2012/13. For the first six month of 2014/15, KKP had general and admin expense of THB
215,673.
Net Profit (loss)
Due to KKP has not yet operated, there was no revenues from operation. However, KKP
reported a consecutive net loss over the past years.
In 2012/13 KKP had net losses of THB 6,557,884 decreased by 42.58% compared with
that of 2011/12. In 2013/2014 KKP had net losses of THB 14,798,085 increased by 125.65%
compared with that of 2012/2013. For the first six month of 2014/15 KKP had net losses of THB
2,325,918
Financial Status
Assets
Major assets of KKP consist of non-current assets which is investment properties.
At the end of 2012/13, KKP had total assets of THB 511.17 million, decreased of THB
1.02 million or 0.20% from at the end of 2012 which had total assets of THB 512.19 million.
Major assets of KKP were non-current assets, comprised of investment properties of THB
510.39 million.While current assets stood at THB 0.78 million.
At the end of 2013/14, KKP had total assets of THB 511.41 million, increased of THB 0.24
million or 0.05% from at the end of 2013. Major assets of KKP were non-current assets,
comprised of investment properties of THB 510.39 million. While current assets stood at THB
1.03 million.
For the first six month of 2014/15, KKP had total assets of THB 531.40 million, increased
of THB 19.99 million or 3.91% from at the end of 2014. Major assets of KKP were non-current
assets, comprised of investment properties of THB 510.39 million and advance for purchases of
land of THB 20 million. While current assets stood at THB 1.01 million
Liabilities
At the end of 2012/13, KKP had total liabilities of THB 155.68 million, increased of THB
5.54 million or 3.69% from at the end of 2012, which had total liabilities of THB 150.14 million.
The increase of total liabilities in 2012/13 was due to an increase in other payable of THB 5.62
million. Major assets of KKP were non-current liabilities, comprised of long term loan from
parent of THB149.15 million. While current asset stood at THB 6.53 million.
At the end of 2013/14, KKP had total liabilities of THB 170.72 million, increased of THB
15.04 million or 9.66% from at the end of 2013. The increase of total liabilities in 2013/14 was
due to an increase in other payable and long term loan from parent in the amount of THB 5.92
million and THB 9.12 million, respectively. Major assets of KKP were non-current liabilities,
comprised of long term loan from parent of THB 158.28 million. While current asset stood at
THB 12.45 million.
For the first six month of 2014/15, KKP had total liabilities of THB 193.04 million,
increased of THB 22.31 million or 13.07% from at the end of 2014. The increase of total
liabilities in second of 2014/15 was due to an increase in long term loan from parent THB 20.25
million. Major assets of KKP were non-current liabilities, comprised of long term loan from
parent of THB 178.52 million. While current asset stood at THB 14.52 million.
Attachment 3 Page 4
Shareholders’ equity
At the end of 2012/2013, KKP had total shareholders’ equity of THB 355.49 million,
decreased of THB 6.56 million or 1.81% from at the end of 2012 which had total shareholders’
equity of THB 362.05 million, resulted from the entire net loss in 2013.
At the end of 2013/2014, KKP had total shareholders’ equity of THB 340.69 million,
decreased of THB 14.80 million or 4.16% from at the end of 2013, resulted from the entire net
loss in 2014.
For the first six month of 2015, KKP had total shareholders’ equity of THB 338.36
million, decreased of THB 2.33 million or 0.68% from at the end of 2014, resulted from the
entire net loss in second quarter of 2015.
6. Industry Outlook in Property Business
During 2nd Half of 2014, it is expected that real estate business will improve as the political
turmoil eases. In addition, the new government’s stimulus measures aimed at shoring up the
economy should help support the real estate market that has been plagued by negative factors
since early 2014. However, there are other risks that may hurt home buying decisions, including
an unstable recovery in the Thai economy, rising cost of living and hefty household debt.
Kasikorn Research Center have conducted a survey on Thai consumer behavior toward
home purchases in Greater Bangkok – that accounts for the largest share of the country’s real
estate investments – and in other key cities, i.e., Songkhla, Nakhon Ratchasima, Khon Kaen,
Chiang Mai and Chonburi, given the extraordinary growth seen in real estate investment there
over recent years. The survey was conducted both before and after the NCPO took control of
Thailand’s administration and the results are summarized, as follows:
•
Consumer sentiment has improved, post-takeover, with a majority of the respondents
having less concern about domestic politics, the economy and incomes compared to the
period before the takeover.
•
Prospective home buyers are more enthusiastic, with 62.8 percent of the respondents
saying that before the takeover they were uncertain when they should buy, but similar
responses fell to 55.6 percent, post-takeover. More were specifying a definite timing to
buy during 2H14, or intending to buy within 1-3 years. This signals that the real estate
market should gradually recover as the economy stabilizes along with other positive
factors.
•
The survey also shows that 84.3 percent intend to live in the homes they purchase,
while 9.3 percent intend to buy as an investment and only 6.4 percent intend to buy
homes for business purposes or as a second or vacation home.
Delayed purchases seen in some consumer segments have forced developers to
introduce promotions to induce sales. According to the poll, 57.3 percent of the respondents felt
that these strategies were swaying them, while 42.7 percent thought otherwise, saying that
housing project quality, developer reputation and materials used are more important.
Source: Kasikorn Research Center as of September 11, 2014
Attachment 3 Page 5
Attachment 4
Company Information and Operating Results of
BTS Group Holding Public Company Limited
1.
General Information
Name
Type of Business
Website
Address
:
:
:
:
Telephone
Fax
Registered Capital
:
:
:
Paid-up Capital
:
2.
BTS Group Holdings Public Company Limited
Mass Transit Business
http://www.btsgroup.co.th/
21 Soi Choeypuang, Viphavadeerangsit Road, Jompol,
Chatuchak, Bangkok 10900
02-273-8611-5
02-273-8610
THB 63,652,544,720
Divided into 15,913,136,180 ordinary shares with a par value
of Baht 4.00 per share
THB 47,677,000,644
Divided into 11,919,250,161 ordinary shares with a par value
of Baht 4.00per share
Nature of Business
2.1 Background
BTS Group Holdings Public Company Limited (formerly known as Tanayong Public
Company Limited) was established on 27 March 1968 to operate the property development
business. The Company was listed on the Stock Exchange of Thailand and commenced the
first day trading of its shares on 1 March 1991 by using “TYONG” as a tricker. The Company
was converted to a public limited company on 2 June 1993. Since then, the Company has
expanded its scope into various types of business, such as property development projects,
condominiums in the center of the city, serviced apartments, office buildings, hotels and
infrastructure projects. In 1992, Tanayong established a wholly-owned subsidiary, Bangkok
Transit System Corporation Ltd. (BTSC), to sign the concession contract with the Bangkok
Metropolitan Administration (BMA) to design, build and operate Bangkok’s first mass transit
system and Commercial operation of the BTS SkyTrain commenced on December 5st, 1999
The Company continues to expand its business. On 4 May 2010, the Company acquired
94.60 % of total issued shares of BTSC and changed the Company’s name to BTS Group
Holdings Public Company Limited. As a result, the Company’s main business has changed
to the mass transit business. Therefore, to better reflect the Company’s new main business,
on 11 May 2010, the Company changed the sector to “Transportation and Logistics” under
the “Services” industry and changed its trading symbol to “BTS”.
2.2 Nature of Business
1) Mass Transit Business
BTSC currently is the operator of the SkyTrain System and the BRT. The current 23.5
km network of the BTS SkyTrain System runs across the center of Bangkok, connecting the
Attachment 4 Page 1
business district to major department stores, hotels and other destinations. BTSC also
manages the 2.2 km Silom Line Extension owned by BMA. BTSC also continues to expand
its scope of operation services as the mass transit network continues to expand. On 5
December 2013, BTSC commenced full operation of the 5.3km Silom Line extension from
Wongwian Yai to Bang Wa following the award of this 30-year Operating and Maintenance
Service (O&M) Contract from the Bangkok Metropolitan Administration (BMA) in May 2012.
(Note that trial operation from Wongwian Yai to Talat Phlu was commenced in early 2013.)
Through this expansion programme, the Company aims to be a part of fostering a higher
quality of service to the public.
2) Media Business
Advertising Business conducted by VGI which operates in the service provider
network media by focusing on network media, consistent with the pattern of life in the
modern era (Lifestyle Media) by the current network of VGI media access to the daily lives of
audiences everywhere from traveling by BTS Skytrain, working in an office building and
shopping in modern trade.
3) Property Business
Real Estate Business is the original core business of the company since embarking.
Currently, the Group continues to operate property in part of the mechanism to strengthen
urban communities that are growing and expanding along the sky train route. Moreover, BTS
sky train business will add value to the media business
4) Service Business
Within the Services business, we focus on providing convenience to our customers
through various kinds of services. Rabbit cards can be used as a common ticket across
Mass Transit systems, such as BTS SkyTrain and BRT Bus as well as for payment ofgoods
and services at rabbit’s participating retail stores to earn Carrot Rewards.
We also have ChefMan Restaurant, a premium Chinese restaurant chain committed
to providing excellent food with high quality ingredients cooked by professional. Moreover,
we manage 3 to 4 star hotels under ‘U Hotels & Resorts’ and ‘Eastin Hotels & Residences”
brands across South East Asia. Ouer Vision is to provide a unique range of complete
hospitality services and consultancy on an a la carte basis with tailor-made client-, ownerand developer-centric solutions.
2.3 Corporate Structure
Business Organisation of the Company, Subsidiaries and Associated Companies as
of 31 March 2014
1) Mass transit Business
The core business of the company by BTSC (a subsidiary of the Company holding
97.46 percent)
2) Media Business
By VGI’s Group
3) Property Business
This is the original core business of the company since embarking. Currently, the
Group continues to operate in property business
4) Service Business
Attachment 4 Page 2
The services that supp
T
port the imp
plementation
n of the corre businessses of the Group
G
in
v
various
field
ds, includin
ng electronic money (e
e-money) with
w
a common ticket system
u
under
the na
ame "Rabbiit"
Rema
ark: Annual Rep
port 2013/14 of BTSG
Atta
achment 4 Pag
ge 3
2.4 Revenue structure by product
Revenue structure during 2011/12-2013/14 and the 2st quarter of 2015 were
summarized as follows.
FY 2011/12
Operating Revenue
THB
Million
FY 2012/13
THB
Million
(%)
FY 2013/14
(%)
THB
Million
Q2/2015
(%)
THB
Million
(%)
Mass Transit
5,031.9
65.2
6,015.5
58.0
2,312.5
26.4
609.4
36.2
Media
1,958.8
25.4
2,794.7
26.9
3,121.2
35.6
787.0
42.1
Property
728.3
9.4
1,444.7
13.9
2,934.1
33.5
330.9
17.7
Services
0.0
0.0
120.6
1.2
399.0
4.6
144.2
7.7
7,719.8
100.0
10,375.5
100.0
8,766.8
100.0
1,871.5
100.0
Total
Source: Form 56-1 FY 2012/13 and FY 2013/14 of BTSG and Financial Statement of BTSG as of 30 September, 2014
3.
List of Shareholders
Top 10 major shareholders of BTSG as of June 10, 2014 (the latest book closing
date) are as follows:
No.
Name of Shareholders
1.
Mr.Keeree Kanjanapas Group*
2.
Number of Shares
(Shares)
% Shareholding
4,886,135,039
41.01
Thai NVDR Co., Ltd.
770,667,077
6.47
3.
Bangkok Bank Public Company Limited
545,466,733
4.58
4.
HSBC (Singapore) Nominees Pte Ltd
178,476,063
1.50
5.
State Street Bank Europe Limited
93,279,408
0.78
6.
K Equity 70:30 LTF
88,896,700
0.75
7.
K Equity Dividend LTF
62,131,600
0.52
8.
Chase Nominees Limited 46
60,651,410
0.51
9.
State Street Bank and Trust Company
58,578,083
0.49
10.
Mr. Sombat Panitcheewa
53,592,992
0.45
Other shareholders
Total
Source:
5,121,375,056
42.97
11,919,250,161
100.00
Thailand Securities Depositary Co., Ltd.
Remark: * Mr. Keeree Kanjanapas Group consists of (1) Mr. Keeree Kanjanapas holding 3,881,164,652 shares on his own
name, holding 350,000,000 shares through the custodian, UBS AG HONG KONG BRANCH, and holding
260,000,000 shares through the custodian, CREDIT SUISSE AG, SINGAPORE BRANCH (2) Mr. Kavin Kanjanapas
holding 2,459,295 shares, (3) Ms. Sushan Kanjanapas holding 32,460,000 shares, (4) K2J Holding Co., Ltd. holding
360,000,000 shares, and (5) Amsfield Holdings Pte. Ltd. holding 51,092 shares
Attachment 4 Page 4
4.
Board of Directors
List of BTSG’s Board of Directors as of November 24, 2014 are as follows.
No.
Name of Directors
Position
1
Mr. Keeree Kanjanapas
2
Mr. Paul Tong
Chairman
Director
3
Mr. Anat Arbhabhirama
Director
4
Mr. Surapong Laoha-unya
Director
5
Mr. Kavin Kanjanapas
Director
6
Mr. Rangsin Kritalug
Director
7
Mr. Chi Kueng Kong
Director
8
Lt.Gen. Phisal Thepsithar
Independent Director/ Chairman of Audit Commitee
9
Mr. Amorn Chandarasomboon
Independent Director
10
Mr. Suchin Wanglee
Independent Director/ Audit Committee
11
Mr. Charoen Wattanasin
Independent Director/ Audit Committee
12
Mr. Ying Chew Henry Cheong
Independent Director
Source: www.set.or.th
5.
Summary of Financial Highlights and Analysis of Operational Performance and
Financial Status of BTSG
Statement of Financial Position
(Unit: THB million)
Consolidated
as of 30 March
as of
1 April
2012
Statement of Financial Position
2013
As of 30
September
2014
2014
Assets
Current assets
Cash and cash equivalents
1,333.2
3,513.3
8,668.5
5,955.7
Current investments
Bank account for advances from cardholders
Trade and other receivables
-
993.8
23,496.3
20,505.2
1.1
78.9
152.7
179.8
1,106.7
945.6
1,074.5
1,451.8
Current portion of asset under operating lease
-
-
90.0
91.1
Current portion of asset under finance lease
-
-
26.3
27.1
Consumable spare parts
93.0
29.2
31.0
24.3
Advances to Contractors
13.8
25.6
13.7
18.2
3,349.1
3,510.3
2,549.8
2,462.8
73.0
73.0
68.3
68.9
224.3
224.3
224.3
224.3
1,202.5
247.8
671.7
470.9
128.0
137.6
60.6
96.3
Real estate development costs
Assets awaiting transfer under rehabilitation plan
Investments in subsidiaries awaiting transfer under
rehabilitation plan
Accrued income
Prepaid expenses
Other current assets
342.9
315.9
215.4
229.8
7,867.6
10,095.3
37,343.1
31,806.2
-
42,123.1
-
-
7,867.6
52,218.4
37,343.1
31,806.2
Non-current assets classified as assets held for sale
Total current assets
Attachment 4 Page 5
(Unit: THB million)
Consolidated
as of 30 March
as of
1 April
2012
Statement of Financial Position
2013
As of 30
September
2014
2014
Non-current assets
Restricted deposits
323.8
88.5
611.1
1,185.6
Cash deposited as collateral for debt settlement
232.7
232.7
232.7
232.7
-
-
44.5
38.4
7.0
10.0
13,899.0
14,215.4
148.8
367.5
6,238.2
4,900.3
45,144.2
-
-
-
Investments in a joint venture
Investments in associates
Other long-term investments
Project costs – elevated train system
Project costs – media
-
-
2,340.1
2,321.2
Reusable spare parts
81.2
22.4
21.9
32.6
Spare parts - maintenance contract
292.8
-
-
-
Land and projects awaiting development
2,676.3
-
263.9
263.9
Investment properties
2,461.0
2,867.6
3,101.5
3,080.0
Property, plant and equipment
6,039.2
9,590.8
7,674.0
8,241.7
Leasehold rights
90.0
81.5
77.6
73.5
Intangible assets
26.7
50.2
65.8
66.8
2.1
2.0
2.4
1.8
Retention receivable
Goodwill
Deposits and advances for assets. acquisitions
78.7
78.7
78.7
78.7
496.9
481.7
45.0
45.0
79.6
0.2
0.2
-
-
-
325.0
341.5
741.5
545.1
204.0
204.0
-
-
3,657.6
3,661.6
-
-
60.1
46.4
1,428.4
259.8
37.3
46.0
98.5
393.8
387.4
422.4
60,449.4
15,072.5
39,368.0
39,499.5
68,317.0
67,290.9
76,711.1
71,305.7
1,941.5
1,117.0
-
220.0
1,514.8
1,948.2
2,222.4
2,379.4
Advances to contractors
Accrued income
Rights of claim from acquisition of debts per rehabilitation
plan
Accounts receivable - net of the concession to be received
within one year
Finance lease asset - net of current portion received within
one year
Deferred tax assets
Other non-current assets
Total non-current assets
Total assets
Liabilities and shareholders’ equity
Current liabilities
Bank overdraft and short-term loans from financial
institutions.
Trade and other payables
Advances received from cardholder
1.1
77.7
151.1
179.4
351.9
152.3
73.8
130.3
Short-term loans from related individual and party
-
-
20.0
-
Current portion of creditors per rehabilitation plan
745.4
745.4
745.4
745.4
Current portion of long-term loans
583.4
1,967.2
10.0
22.0
2,495.8
2,078.7
3,607.6
1,466.1
-
80.8
181.9
181.9
160.2
470.4
105.1
101.0
Accrued costs of construction
Current portion of long-term debentures
Liability awaiting final court order
Unearned revenues
Attachment 4 Page 6
(Unit: THB million)
Consolidated
as of 30 March
as of
1 April
2012
Statement of Financial Position
Fare box revenues awaiting transfer
2014
95.1
177.0
181.1
55.8
148.0
988.9
546.5
Short-term provision – related parties
Total current liabilities
2014
137.7
Income tax payable
Other current liabilities
2013
As of 30
September
-
-
45.8
56.4
350.4
141.1
201.3
305.2
8,338.0
9,021.9
8,530.3
6,514.7
-
-
641.8
608.6
Non-current liabilities
Unearned revenues
Creditors per rehabilitation plan – net of current portion
52.1
51.9
49.6
49.6
Long-term loans - net of current portion
2,934.0
396.7
230.0
1,193.5
Long-term debentures - net of current portion
9,443.8
6,401.0
2,807.4
1,343.9
Convertible debentures - liability component
8,648.3
-
-
-
Retention payable
127.5
68.0
40.6
44.0
Provision for long-term employee benefits
400.2
481.7
557.6
585.7
-
-
1,266.9
1,353.3
108.1
360.8
3,037.1
2,964.7
12.7
7.2
7.7
8.3
Long-term provision – related party
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities
21,726.7
7,767.3
8,638.7
8,151.6
Total liabilities
30,064.7
16,789.2
17,169.0
14,666.3
47,881.8
47,945.8
63,652.5
63,652.5
36,600.5
44,426.5
47,656.9
47,656.9
350.7
1,486.1
1,797.2
1,797.2
-
1,295.6
-
22.0
(3,372.0)
(3,372.0)
(3,372.0)
(3,372.0)
(123.1)
2,811.2
4,448.3
3,873.3
Surplus from the sale of warrants of the company.
-
-
-
347.0
Treasury shares
-
-
-
(925.5)
1,476.0
1,750.5
2,760.3
2,760.3
-
-
-
925.5
(1,705.8)
(3,465.9)
818.1
(1,325.2)
Shareholders’ Equity
Share capital
Registered
15,913,136,180 ordinary shares of THB 4 each
(31 March 2013: 11,986,444,024 ordinary shares, par value
THB 4 each)
(April 1, 2012: 74,815,275,124 ordinary shares of THB 0.64
per share).
Issued and fully paid.
11,914,230,525 ordinary shares of THB 4 each
(31 March 2556: 11,106,634,594 ordinary shares, par
value.THB 4 each)
( 1 April 2012: 57,188,274,676 ordinary shares of THB 0.64
each)
Share premium
Share subscriptions received in advance
Deficit on business combination under common control
Surplus (deficit) from the changes in the ownership interests
in subsidiaries
Retained earnings
Appropriated for legal reserve
Appropriated reserve for treasury shares.
Retained earnings (loss)
Attachment 4 Page 7
(Unit: THB million)
as of
1 April
2012
Statement of Financial Position
Other components of shareholders’ equity.
Equity attributable to owners of the Company
Non-controlling interest of the subsidiaries
Consolidated
as of 30 March
2013
As of 30
September
2014
2014
3,340.7
3,663.5
3,577.1
3,439.1
36,567.0
48,595.5
57,685.9
55,198.6
1,685.3
1,906.2
1,856.2
1,440.8
Total shareholders’ equity
38,252.3
50,501.7
59,542.1
56,639.4
Total liabilities and shareholders’ equity
68,317.0
67,290.9
76,711.1
71,305.7
Source: Form 56-1, Consolidated Financial Statements of BTSG for the period ended September 30, 2014.
Profit and loss
(Unit: THB million)
Consolidated
Statement of comprehensive income
For the six
months ended
September 30
For the fiscal year ended March 31
2012
2013
2014
2014
Continuing operations
Profit or loss:
Revenues
Train operators income
Service income
Revenues from sales of real estate
Revenues from construction services (reversal)
-
-
-
49.8
3,281.2
4,787.6
6,056.4
3,141.4
325.5
787.9
2,057.2
250.5
72.8
9.2
1.6
-
Other income
Management income
-
-
0.1
-
Dividend income
0.4
1.8
6.0
29.1
Interest income
39.7
58.9
1,213.2
619.7
Gain from sale of investments
-
-
-
105.9
Gain from sales of investments in subsidiaries
-
999.7
-
-
Gain on sale of future net fare box revenues
-
-
13,497.6
-
Gain on sales of assets
-
-
379.9
0.3
Others
Total Revenues
1,235.4
63.7
88.6
77.4
4,955.0
6,708.8
23,300.6
4,274.1
Expenses
Cost of train operators.
Cost of services
Cost of sales of real estate
-
-
-
49.8
1,586.1
2,346.8
2,828.1
1,472.2
226.8
527.3
1,260.4
156.4
Cost of construction services
83.4
8.3
0.7
-
Selling and servicing expense
132.1
223.1
342.1
78.6
Administrative expenses
740.1
1,077.9
1,496.7
746.0
2,768.5
4,183.4
5,928.0
2,503.0
2,186.5
2,525.4
17,372.6
1,771.1
-
-
-
(6.1)
(2.3)
3.0
619.2
397.9
Total expenses
Profit before share of income from investments in
associates and joint venture, finance cost and income
tax expenses
Share of income from investments in joint ventures.
Share of income (loss) from investments in associates.
Attachment 4 Page 8
(Unit: THB million)
Consolidated
Statement of comprehensive income
For the six
months ended
September 30
For the fiscal year ended March 31
2012
2013
2,184.2
2,528.4
(1,432.0)
(1,247.8)
(630.7)
(245.6)
752.2
1,280.6
17,361.1
1,917.3
(172.6)
(1,248.1)
(3,806.4)
(403.5)
579.6
32.5
13,554.7
1,513.8
Profit from discontinued operation for the year.
1,656.0
1,894.7
30.3
-
Profit for the year
2,235.6
1,927.2
13,585.0
1,513.8
-
(31.7)
-
-
0.9
11.9
(0.9)
1.5
-
281.4
-
-
-
-
-
(27.7)
4.2
15.0
(94.1)
(119.2)
5.1
276.6
(95.0)
(145.4)
2,240.7
2,203.8
13,490.0
1,368.4
Profit before finance cost and income tax expense.
Financial cost
Profit before income tax expenses
Income tax expenses
Profit from continued operation for the year
2014
2014
17,991.8
2,162.9
Discontinued operation
Other comprehensive income:
Actuarial gains (losses)
Exchange rate differences on translation of financial
statements in foreign currency
Revaluation surplus on assets
Gain on changes in value of available for sale investments sold portion
Gain (loss) on changes in value of available-for-sale
investments
Other comprehensive income for the period
Total comprehensive income for the period
Profit (loss) attributable to:
Equity holders of the Company
Profit (loss) from continued operations.
Profit from discontinued operations.
509.5
(144.8)
12,615.3
1,283.6
1,596.1
1,863.4
29.6
-
2,105.6
1,718.6
12,644.9
1,283.6
70.1
177.4
939.4
230.2
Non-controlling interests of the subsidiaries
Profit from continued operations.
Profit from discontinued operations.
59.9
31.3
0.8
-
130.0
208.7
940.2
230.2
2,235.6
1,927.3
13,585.1
1,513.8
Total comprehensive income attributable to:
Equity holders of the Company
Total comprehensive income from continued operations.
Total comprehensive income from discontinued operations.
514.7
132.5
12,520.2
1,138.2
1,596.1
1,863.4
29.6
-
2,110.8
1,995.9
12,549.8
1,138.2
70.1
176.6
939.4
230.2
59.9
31.3
0.8
-
Non-controlling interests of the subsidiaries
Total comprehensive income from continued operations.
Total comprehensive income from discontinued operations.
130.0
207.9
940.2
230.2
2,240.8
2,203.8
13,490.0
1,368.4
Source: Form 56-1, Consolidated Financial Statements of BTSG for the period ended September 30, 2014.
Attachment 4 Page 9
Cash flow
(Unit: THB million)
Consolidated
Cash Flow Statement
For the fiscal year ended March 31
2012
2013
Net cash provided by (used in) operating activities.
1,755.8
4,659.3
Net cash provided by (used in) investing activities.
(2,319.5)
4,097.7
12,180.3
3,661.0
Net cash provided by (used in) financing activities.
70.6
(6,588.8)
(11,048.4)
(6,188.9)
Increase/(decrease) in foreign currency translation
2014
For the six
months ended
September 30
3,218.5
2014
(186.3)
0.9
11.9
(0.9)
1.4
Net increase in cash and cash equivalents.
(492.2)
2,180.1
4,349.5
(2,712.8)
Cash and cash equivalents at beginning of period.
1,825.4
1,333.2
3,513.3
8,668.5
Cash and cash equivalents at end of period.
1,333.2
3,513.3
7,862.8
5,955.7
Source: Form 56-1, Consolidated Financial Statements of BTSG for the period ended September 30, 2014
Summary of key financial ratios
(Unit: THB million)
Consolidated
For the fiscal year ended
March 31.
Ratios
2012
Current Ratio
2013
2014
For the
fiscal year
ended March
31.
2014
(Times)
0.94
5.79
4.31
4.88
(%)
47.2
48.8
53.1
57.6
Net margin
(%)
24.2
16.6
57.8
35.6
Return on shareholders' equity (ROE)B
(%)
6.1
3.8
22.7
4.5
Gross operating profit margin
A
C
Return on Assets (ROA)
Debt-to-equity Ratio (D / E Ratio).
(%)
3.3
2.9
17.7
3.5
(Times)
0.81
0.33
0.28
0.26
Source: Form 56-1, Consolidated Financial Statements of BTSG for the period ended September 30, 2014.
Note:
BTSG the period 1 April to 31 March.
A
calculation of the accounting profit (Excluding the portion of the non-controlling interest in a subsidiary) / total income tax.
B
calculated from accounting profit. (Excluding the portion of the non-controlling interest in a subsidiary) / Shareholders' equity.
C
calculated from accounting profit. (Excluding the portion of the non-controlling interest in a subsidiary) / total assets.
Analysis of financial status and operating performance
Operating performance
• Overall Performance
Year 2013/14 The Company and its subsidiaries (together, the “Group”) recorded
consolidated total revenue of THB 23,300.5 million in FY 13/14. This represented an
increase of 247.3% (or THB 16,591.6 million) from THB 6,708.9 million in FY 12/13. The
increase was primarily due to both stronger operating performance as well as the gain from
the sale of net fare-box revenue to BTSGIF of THB 13,497.6 million (for more details, please
refer to Note 52 to FY 13/14 financial statements). Despite (1) higher O&M revenue from
additional service income from the Silom line extension, (2) stronger Media, Property and
Services operating performance and (3) an increase in interest income by THB 1,154.2
million to THB 1,213.2 million, mainly earned on the sales proceeds from BTSGIF, operating
revenue1 (which already includes share of net profit in BTSGIF of THB 612.5 million) fell by
15.5% YoY to THB 8,766.8 million as a result of the sale of Net fare-box revenues to
Attachment 4 Page 10
BTSGIF. Revenue from the Mass Transit, Media, Property and Services businesses
accounted for 26.4%, 35.6%, 33.5% and 4.6% of total operating revenue, respectively.
Total consolidated expenses and SG&A reached THB 5,928.0 million in FY 13/14, an
increase of THB 1,744.5 million or 41.7% YoY largely from the higher cost of sales of real
estate and cost of services. Operating costs decreased by 22.7% YoY to THB 4,109.9
million largely from the reduction in costs related to the operation of the core network which
was sold to BTSGIF, which offset the increase in operating costs of Property, Media and
Services businesses (see segmental performance for more details). As a result of cost
efficiency and the one-third investment of the units in BTSGIF, the Group operating gross
profit margin2 improved to 53.1% from 48.8% in the previous year.
Although operational performance in Media, Property and Services businesses
improved, the Group operating EBITDA3 margin declined from 49.0% in the previous year to
39.0% due to the higher proportion contribution of lower margin Mass Transit O&M and
Property businesses. Finance costs fell by 49.5% or THB 617.1 million to THB 630.7 million,
primarily as the Group repaid outstanding debt and all CBs were fully converted.
Due to the improved operational performance, the recognition of share of net profit in
BTSGIF, the increase in interest income as well as a reduction in finance costs, recurring
pre-tax profit4 margin for this year improved to 36.4% from 21.6% in FY 12/13. Although the
Company recorded an increase in consolidated income tax to THB 3,806.4 million, mainly
from (1) tax expenses related to capital gain on BTSGIF transaction of THB 2,700.0 million,
(2) tax expenses associated with BTSC capital reduction of THB 406.7 million, net recurring
profit9 improved 153.5% YoY to THB 2,611.6 million in FY 13/14. Taking into account all the
aforesaid transactions, together with non-recurring items which were mainly gain from sale
of net fare-box revenue, the Group recorded a consolidated profit of THB 13,585.0 million
(increasing 604.9% YoY) and profit attributable to the equity holders of the Company of THB
12,644.9 million (increasing 635.8% YoY).
Remark:
1
Operating revenue from the operational performances from 4 BUs and share of net profit (loss) from BTSGIF,
EXCLUDES interest income, and non-recurring items
2
Operating gross profit margin calculated based on the operational performances from 4 BUs and share of net
profit (loss) from BTSGIF
3
Operating EBITDA calculated based on the operational performances from 4 BUs, share of net profit (loss) from
BTSGIF, EXCLUDES interest income and non-recurring items which are dividend income, gain from sales of net
fare-box revenue to BTSGIF, other non-recurring items
4
Recurring profit calculated based on the operational performances from 4 BUs, share of net profit (loss) from
BTSGIF and AHS, as well as including other recurring items which are interest income and other recurring items
(before MI)
During the first 6 month of 2014/15 the Group recorded consolidated total revenue
of THB 2,106.6 million in 2Q 14/15, falling 27.0% or THB 779.9 million YoY from THB
2,886.5 million in 2Q 13/14. The reduction was primarily due to (1) a decrease in revenue of
sales of real estate of THB 541.1million, (2) a gain on the sales of land of THB 379.8 million
in 2Q 13/14 which was not repeated in 2Q 14/15, yet offset with (3) an increase in service
income of THB 170.5 million mainly from the increased O&M revenue. Despite (1) higher
O&M revenue from additional service income from the Silom line extension (2) additional
scope of work in BRT contract and (3) an increase in share of net profit from BTSGIF units,
operating revenue2 fell by 17.8% YoY to THB 1,871.5 million largely as a result of the
reduction in Property revenue from fewer transferred units of Abstracts Phahonyothin Park
Condominium in 2Q 14/15 and the softened Media revenue. Revenue from the Mass Transit,
Media, Property and Services businesses accounted for 32.6%, 42.1%, 17.7% and 7.7% of
total operating revenue, respectively.
However, operating revenue rose 7.3% QoQ to THB 1,871.5 million as a result of the
improved performance of all business units. Mass Transit revenue rose 11.8% QoQ, which
was mainly attributable to an increase in share of net profit in BTSGIF units and the
additional scope of work in BRT contract. Media revenue rebounded 4.4% QoQ, which was
in line with the slow economic growth momentum. Property revenue also increased 3.6%
Attachment 4 Page 11
from the previous quarter as a result of the improvement in our group of hotels’ business.
Lastly, Services revenue showed 14.6% growth, largely owing to the strong performance of
ChefMan Restaurants.
Total consolidated expenses and SG&A reached THB 1,275.2 million in 2Q 14/15, a
reduction of THB 312.1 million or 19.7% YoY mainly from the decline in cost of sales of real
estate as well as selling and marketing expenses related to sales of Abstracts Condominium
project. Operating costs decreased by 26.8% YoY to THB 793.0 million, which was in line
with the reduction in total operating revenue. Nonetheless, as operating costs decreased at
a higher rate than the decline in operating revenues, the Group operating gross profit
margin5 improved to 57.6% from 52.4% in the previous year.
As a result of the aforementioned changes, the Group operating EBITDA6 was THB
738.7 million, a decrease of THB 102.8million or 12.2% YoY and an increase of THB 49
million or 7.1% QoQ. However, the operating EBITDA margin improved to 39.5% in 2Q
14/15 (versus 37.0% in 2Q 13/14) from growth in O&M margin and lower contribution from
low margin business. Finance costs fell by 35.6% or THB 61.9 million to THB 112.0 million,
primarily as the Group repaid the third tranche of BTSC debentures (THB 3,611.3 million) in
August 2014. The net recurring (post-tax) profit7 margin for this quarter improved to 32.9%
from 28.2% in 2Q 13/14 from the improved operating gross profit, an increase in other
recurring income of THB 48.4 million, a reduction in finance costs as well as a reduction in
income tax expenses of THB 21.7 million. Taking into account all the aforesaid transactions,
the Group recorded a consolidated profit of THB 751.5 million (decreasing 31.0% YoY) and
profit attributable to the equity holders of the Company of THB 633.4 million (decreasing
33.1% YoY).
5
Remarks: Operating gross profit margin calculated based on the operational performances from 4 BUs and share of net profit
(loss) from BTSGIF
6
Operating EBITDA calculated based on the operational performances from 4 BUs, share of net profit (loss) from
BTSGIF, EXCLUDES interest income, dividend income, share of net profit (loss) from other associates (except from
BTSGIF) and joint venture, non-recurring items from sales of net fare-box revenue to BTSGIF and other nonrecurring items
7
Recurring profit calculated based on the operational performances from 4 BUs, share of net profit (loss) from
BTSGIF and other associates and joint venture, as well as including other recurring items which are interest income
and other recurring items (before MI)
• Segmental Performance
MASS TRANSIT
FY2013/14 Total Mass Transit8 revenue dropped 61.6% YoY to THB 2,312.5 million.
As a result of the sale of net fare-box revenue to BTSGIF, fare-box revenue decreased from
THB 4,895.5 million to THB 207.7 million this year, and costs and SG&A related to the Core
Network dropped from THB 2,939.7million to THB 134.7 million (BTSG recorded
transactions related to the Core Network for 16 days before the completion of the BTSGIF
transaction on 17 April 2013). O&M revenue increased YoY by 33.2% or THB 372.3 million
to THB 1,492.3 million. Furthermore, the Company recorded a share of net profit from its
investment in BTSGIF units of THB 612.5 million in FY 13/14.
(In order to enable analysis of underlying performance on a comparable basis to previous years, the following section
analyses fare-box revenues, O&M revenues and their associated costs and SG&A for the full years of FY 13/14 and FY 12/13
irrespective of whether BTSG or BTSGIF had the rights to such revenues.)
Total revenue from the Mass Transit business increased by 19.2% YoY to THB
7,169.4 million supported by an increase in fare-box revenue and an increased O&M
income.Fare-box revenue increased 16.0% (or THB 781.6 million) to THB 5,677.1 million on
account of ridership growth (up 8.9% YoY to 214.7 million trips) and the increased average
fare (which rose by 6.5% YoY to THB 26.4 per trip, following the recent fare hike on 1 June
2013). Key ridership growth factors included organic growth and the commencement of 4
stations (from Wongwian Yai – Bang Wa) of the Silom line extension, which fed more
passengers to the Core Network. To accommodate the increasing patronage, the Company
introduced additional carriages into service (all trains on the Sukhumvit line were extended
Attachment 4 Page 12
from 3-car trains to 4-car trains since May 2013 and all of the new five 4-car trains became
available for service in February 2014). O&M revenue rose by 33.2% or THB 372.3 million
YoY to THB 1,492.3 million, mainly attributable to the additional service income from the
Silom line extension which opened on 5 December 2013.
Cost of Mass Transit revenue, including SG&A, rose by 17.9% or THB 639.6 million
YoY to THB 4,213.2 million, tied to higher ridership. Key cost items were cost of fare-box
which increased in line with the ridership growth, costs of train operation and maintenance
which increased in line with higher O&M revenue, and depreciation recorded (from higher
ridership and new trains). As costs and SG&A increased less than the revenue growth, this
led to the improvement in operating EBITDA margin to 65.9% in FY 13/14 (versus 64.8% in
FY 12/13).
8
Remarks: Mass Transit revenues include:
i) 16-day fare-box revenue
ii) Share of net profit (loss) from BTSGIF (included in ‘Share of profit from investments in associates and joint venture’
in Statement of comprehensive income)
iii) Service Income from Train & Bus Operation Management (included in ‘Service income’ under ‘Revenues from
provision of operating services’)
During the first 6 month of 2014/15 Total Mass Transit revenue9 increased 31.9%
YoY to THB 609.4 million supported by an increase in O&M income and an increase in share
of net profit from BTSGIF. O&M revenue rose by 36.3% or THB 104.5 million YoY to THB
392.2 million, mainly attributable to the additional service income from the Silom line
extension which opened on 5 December 2013 and the additional scope of work in BRT
contract.
Share of net profit from investment in BTSGIF units in 2Q 14/15 increased by THB
42.8 million or 24.6% YoY to THB 217.2 million. However, there was revision of amortisation
method for fund set-up cost from 3 years to the end of concession to be in line with other
BTSGIF related items. As such, the “share of net profit in BTSGIF” this quarter includes an
adjustment of the previous ‘over amortisation’ in the amount of THB 54.5 million.
This increase came from revision of amortisation method for fund set-up cost, offset
with the decrease in net fare-box revenue. Fare-box revenue of the core system rose by
2.7% YoY or THB 38.2 million to THB 1,455.0 million attributable to both ridership growth (up
2.1% YoY to 54.6million trips) and average fare increase (which rose by 0.6% YoY to THB
26.6 per trip). Cost of fare-box revenue rose at a faster rate than revenue growth, resulting in
the decline in net fare-box revenue.
Cost of Mass Transit revenue, including SG&A expenses, increased by 6.2% or THB
12.0 million YoY to THB 205.6 million, in line with higher O&M revenue. As operating
revenue grew more than the increase in operating cost and SG&A expenses, this led to an
improvement in the operating EBITDA margin to 66.8% in 2Q 14/15 (versus 59.8% in 2Q
13/14).
9
Remarks: Mass Transit revenues include:
i) Share of net profit (loss) from BTSGIF (included in ‘Share of profit from investments in associates’ in Statement of
comprehensive income)
ii) Service Income from Train & Bus Operation Management (included in ‘Service income’ under ‘Revenues from
provision of operating services’)
MEDIA
FY 2013/14 Even though the 30% revenue growth target was not achieved as a
result of consumption slowdown and political disruptions in the second half, our Media
business revenue still grew 11.7% (or THB 326.5 million) YoY to THB 3,121.2 million.
Factors contributing to our Media revenue growth mainly came from the revenue growth in
BTS-related Media
BTS-related Media revenue was THB 1,659.9 million, representing growth of 20.3%
or THB 280.6 million YoY. This was mainly due to (1) the aforementioned increase in
Attachment 4 Page 13
carriages; (2) the increase in capacity from i) Platform Truss LEDs ii) Platform Screen door
iii) Platform Truss Static and (3) increased merchandising revenue as a result of the increase
in rent for long-term contracts of merchandising space on the BTS station which became
effective this year, coupled with the increased occupancy of small rental shops on stations,
which grew with increased ridership.
Revenue from Modern Trade Media reached THB 1,295.2 million, an increase of
3.7% or THB 45.6 million YoY. Key growth drivers came from the increase in occupancy of
sales floor areas and the development of radio streaming technology in Big C branches
nationwide.
Office Building & Other Media revenue reached THB 166.1million, rising by 0.2%
YoY or THB 0.4 million. This increase was primarily supported by (1) higher sales from
additional office buildings and (2) full year recognition of the rights to advertise in
Chulalongkorn University’s bus system.
Cost of revenue increased 7.9% or THB 89.7 million YoY to THB 1,231.5 million and
Media SG&A increased by 8.9% or THB 32.8 million YoY to THB 399.7 million. As a result of
the improvement in operational performance in BTS-related Media, which is the biggest
contributor to total Media revenue, the operating EBITDA margin of the Media business
improved to 50.6% in FY 13/14 (49.6% in FY 12/13).
During the first 6 month of 2014/15 The economy continued to show signs of slow
recovery despite the establishment of clearer political policies. As a result, media advertising
spending grew 2.3% QoQ, in line with the slow economic growth momentum. Our Media
business outperformed the media industry with revenue growth of 4.4% from the previous
quarter to THB 787.0 million.
BTS-related Media continued to grow resiliently to THB 441.6 million with increased
revenue of THB 13.7 million (or 3.2% QoQ) mainly coming from (1) the increase in capacity
from new digital media (Platform Truss LEDs and Platform Screen Doors) on BTS stations,
(2) higher revenue from merchandising space and (3) higher revenue from In-Train static
media as a result of new sales strategies. Our Modern Trade Media revenue showed growth
of 6.4% due to increase in sales and Office Building and Other Media revenue grew 2.4% as
a result of the increase in office building contracts.
PROPERTY
FY 2013/14 Property operating revenue grew by 103.1% YoY or THB 1,489.4 million
to THB 2,934.1 million which was attributable from both Residential and Commercial
Property. Residential Property revenue increased by 159.5% YoY or THB 1,267.8 million to
THB 2,062.8 million in FY 13/14. The increase was mainly driven by sales of real estate of
THB 2,057.2 million (largely in relation to 610 transferred units of Tower A from Abstracts
Phahonyothin Park, which started transferring in December 2012). Commercial Property
revenue reached THB 861.9million, an increase of 33.6% YoY or THB 216.7 million. The
growth was largely driven by revenue from Eastin Grand Hotel operations at Surasak BTS
SkyTrain station. Revenue from Eastin Grand Hotel accelerated to THB 483.8 million,
representing 60.4% growth YoY. Furthermore, in this year the Group recognised a gain on
the sales of land at Bang Pakong and Bangna KM 18 of THB 379.3 million (versus a gain of
THB 999.7million from sale of investments of land in FY 12/13).
Operating costs rose at a lower rate than operating revenues. The increase of 90.8%
YoY or THB 835.4 million to THB 1,755.8 million was mainly from costs from transferred
units of Abstracts Phahonyothin Park and costs related to Eastin Grand Hotel. Property
SG&A expenses increased by 28.5% YoY or THB 154.7 million to THB 698.4 million mainly
driven by expenses related to transfers from Abstracts Phahonyothin Park, including transfer
fees, marketing expenses and sales commission. Due to the improved operating
performance, the Property business proved to be more profitable this year, with operating
Attachment 4 Page 14
EBITDA improving to THB 631.6 million compared to THB 116.7 million in the previous year
and the operating EBITDA margin improving to 21.5% versus 8.1% in FY 12/13.
During the first 6 month of 2014/15 Property operating revenue dropped a
significant 61.7% YoY or THB 532.4 million to THB 330.9 million, which was largely
attributable to the decline in Residential Property revenue as a result of fewer transferred
condominium units of Abstracts Phahonyothin Park (Tower A) compared to 2Q 13/14.
Residential Property revenue decreased by 81.7% YoY or THB 540.9 million to THB
121.2 million in 2Q 14/15. This decrease was mainly driven by a decline in sales of real
estate of THB 541.1 million (largely in relation to 33 transferred units of Abstracts
Phahonyothin Park (Tower A) in this quarter versus 201 transferred units in 2Q 13/14).
Commercial Property revenue reached THB 207.6 million, an increase of 4.3% YoY
or THB 8.6 million mainly supported by an improvement in Thana City Golf Course and the
Groups hotel business performance.
Operating costs decreased at the same rate as the reduction in operating revenues.
The decrease of 63.1% YoY or THB 329.5 million to THB 192.9 million was mainly from a
decline in costs from transferred units of Abstracts Phahonyothin Park. Property SG&A
expenses also decreased by 31.9% YoY or THB 60.8 million to THB 129.8 million largely
from the reduction in selling and marketing expenses related to Abstracts Condominium
project. As a result of the decrease in sales of real estate from the aforesaid reasons, the
operating EBITDA margin contracted to 13.9% in 2Q 14/15 compared to 21.8% in 2Q 13/14.
SERVICES
FY 2013/14 Services business revenue increased YoY by THB 278.5 million to THB
399.0 million. This increase was primarily due to (1) the growth in revenue generated from
Chef Man Restaurant of THB 219.7 million as well as (2) a growth in royalty fee recognised
from the co-ordination between BSS and its business partner from the issuance of the cobranded rabbit cards, which was launched in March 2013. As of 31 March 2014, over 2.5
million rabbit cards were issued, exceeding the target number of issued cards for FY 13/14.
Operating costs increased by 47.8% YoY or THB 67.1 million to THB 207.3 million,
increasing at a lower rate than operating revenue. There was also THB 225.9 million SG&A
expenses, an increase of 72.2% YoY. Key costs and SG&A items were mainly from staff
costs, food & beverage cost at Chef Man Restaurants and depreciation expenses (for
hardware, software and machines).
During the first 6 month of 2014/15 Services business revenue increased YoY by
THB 40.5 million or 39.1% to THB 144.2 million. This increase was primarily due to growth in
the revenue generated from ChefMan Restaurants (increased by THB 30.6 million or 57.2%
YoY to THB 84.0 million) as well as growth in the revenue from marketing and co-promotion
of rabbit cards of THB 13.0 million.
However, operating costs increased by 28.1% YoY or THB 14.5 million to THB 66.4
million, increasing at a lower rate than operating revenue. There were also THB 72.9 million
SG&A expenses, an increase of 56.9% YoY. Key costs and SG&A items were mainly from
staff costs, food & beverage cost at ChefMan Restaurants and depreciation expenses (for
hardware, software and machines).
Financial Status
• Assets
As of 31 March 2014, total assets stood at THB 76,757.1 million, a 14.1% increase
from 31 March 2013. Total current assets reduced by 28.7% to THB 37,226.8 million mainly
due to (1) the de-recognition of non-current assets held for sale of THB 42,123.1million from
the Group statement of financial position, in accordance with TFRS 5 following the sale of
future net fare-box revenues to BTSGIF as well as (2) a THB 960.5 million (or 27.4%)
Attachment 4 Page 15
reduction in real estate development costs to THB 2,549.8million as condominium units were
transferred to buyers. This was partially offset with (3) the increase in cash by THB 4,349.5
million (see further details in Cash Flow section) and (4) the increase in current investments
by THB 23,308.2 million, reflecting the treasury management of sales proceeds from
BTSGIF. Total non-current assets rose by 162.3% to THB 39,530.3 million largely from the
increase in (1) investment in associates by THB 13,888.9 million (primarily from the Group’s
investment in one-third of the units of BTSGIF) and (2) other long-term investments by THB
5,870.7 million, largely from the investment in fixed deposits of THB 1,082.3 million and
unsubordinated debentures (the long-term portion of THB 2,999.3 million were placed at a
financial institution in order to secure the principal and interest payment obligations with
respect to BTSC’s Long Term Debentures).
As of 30 September 2014, total assets stood at THB 71,305.7 million, a decrease of
THB 5,405.4 million or 7.0% from 31 March 2014. Total current assets stood at THB
31,806.2 million, decreasing 14.8% mainly from (1) a decrease in current investment of THB
2,991.1 million (mainly from the collateralised debenture, which was used to repay the third
tranche of BTSC debentures of THB 3,611.3 million and the reclassification of the fourth
tranche of BTSC debentures of THB 1,466.2 million to current portion from long-term
portion), (2) a reduction in cash of THB 2,712.8 million (see further details in Cash Flow
section), offset with (3) an increase in trade and other receivables of THB 377.4 million. Total
non-current assets was THB 39,499.5 million, an increase of 0.3% mainly from (1) an
increase in restricted deposits of THB 574.5 million (cash collateral placed with banks), (2)
an increase in PP&E of THB 567.7 million mainly for the development of U Sathorn hotel and
renovation of sport club in Thana City, offset by (3) a decrease in other long-term
investments of THB 1,337.9 million primarily from the aforementioned movement of the
fourth tranche of BTSC debentures which will mature in August 2015 to current portion.
• Liabilities
Increased from 31 March 2013 by 1.2% or THB 205.5 million to stand at THB
16,994.8 million largely due to increases in (1) deferred tax liabilities of THB 2,731.3 million
in accordance with TAS12 Income Taxes, (2) provision for future liabilities from Special
Business Tax levied on BTSGIF, to be absorbed by the Company of THB 1,083.5 million,
and (3) income tax payable of THB 840.9million largely from tax expenses related to BTSC
capital reduction, which offset with the effect of (4) the repayment of bank loans (THB
3,241.0 million) and (5) the second tranche repayment of BTSC debenture (THB 2,081.3
million) in August 2013.
Decreased from 31 March 2014 by 14.6% or THB 2,502.6 million to stand at THB
14,666.3 million largely due to (1) the third tranche repayment of BTSC debentures in
August 2014, (2) a decrease in income tax payable of THB 442.4 million, offset with (3) an
increase in loans from financial institutions of THB 1,195.5 million, of which THB 220.0
million was used by VGI to purchase MACO shares and THB 966.9 million were loans taken
to invest in offshore deposits and investments.
• Shareholders’ equity
As of 31 March 2013 total equity was increased by THB 9,260.6 million or 18.3% to
THB 59,762.3 million. This increase was attributable to (1) an increase in retained earnings
of THB 5,508.3 million largely from the gain from the sale of future net fare-box revenues to
BTSGIF, offset with dividend payments of THB 7,112.0 million, (2) increase in surplus from
the changes in the ownership interests in subsidiaries of THB 1,637.1 million mainly from the
sale of a portion of investment in subsidiary (VGI)10 and (3) increase in paid-up capital by
THB 3,230.4 million to THB 47,656.9 million resulting from the issuance of additional 807.6
million ordinary shares from the exercise of BTS-W2 and BTS-WA. As of 31 March 2014,
total issued and fully paid-up shares stood at 11,914.2 million shares.
Attachment 4 Page 16
As of 30 September 2014 total equity was decreased by THB 2,902.8 million or 4.9%
to THB 56,639.4million mainly attributable to (1) a reduction in surplus from the changes in
the ownership interests in subsidiaries of THB 574.9 million primarily as a result of the
Company increasing its shareholding in subsidiary VGI, (2) a decrease in non-controlling
interest of the subsidiaries of THB 415.4 million due to the purchases of investments in
subsidiaries (VGI and Nuvo Line) and (3) a reduction in unappropriated retained earnings
(excluding the portion reserved for treasury stock) of THB 2,143.3 million. The decline in
unappropriated retained earnings wad mainly from dividend payment of THB 2,501.4 million
for the period of October 2013 to March 2014. As of 30 September 2014, total issued and
fully paid-up shares stood at 11,914.2 million shares.
Remarks: 10The gain on sale of VGI shares was recorded in the consolidated statement of financial position as equity under
“surplus from the changes in the ownership interests in subsidiaries” but not recorded in the profit & loss
account, as the changes in the Company's ownership interest in a subsidiary do not result in a loss of control.
Liquidity
• Cash and Cash equivalents
Cash and cash equivalents as of 31 March 2014 reached THB 7,862.8 million. Net
cash from operating activities declined 30.9% to THB 3,218.5 million compared to THB
4,659.3 million in the previous year. Key contributors of the decrease were the sales of net
fare-box revenue to BTSGIF. Net cash from investing activities stood at THB 12,180.3
million from THB 4,097.7 million last year. Key items include the proceeds from the sale of
net fare-box revenue to BTSGIF, the reinvestment in BTSGIF units and the treasury
management of surplus cash proceeds from the sale. Net cash used in financing activities
was THB 11,048.4 million compared to THB 6,588.8million last year, mainly from debt
repayment of THB 5,322.3 million and dividend payment of THB 7,112.0 million, offset with
cash received from exercised warrants of THB 2,237.5 million. As a result, the consolidated
cash flow statements showed an increase of THB 4,349.5million in cash and cash
equivalents to THB 7,862.8 million from THB 3,513.3 million as of 31 March 2013.
For the six months ended 30 September 2014, cash and cash equivalents reached
THB 5,955.7million. Cash from operating activities was THB 1,080.1 million, declining 52.4%
or THB 1.2 bn primarily due to lower operating revenue of Property and Media businesses
and the decrease in trade and other payable of THB 508.2 million. Cash paid for corporate
income tax of THB 1.1bn (1H 13/14; THB 261.8 million) meant that net cash used in
operating activities was THB 186.3 million. Net cash from investing activities was THB
3,661.0 million. The key components are (1) decrease in current investment of THB 4,567.4
million largely from the repayment of the third tranche of BTSC debenture, (2) cash proceeds
from the sale of “available-for-sale” investments of THB 1,004.7 million, (3) dividend received
of THB 635.4 million (mainly from BTSGIF), (4) cash paid for purchases of other long-term
investments of THB 1,308.7 million and (5) investment in MACO of THB 681.2 million. Net
cash used in financing activities was THB 6,188.9 million mainly from (1) the cash paid for
the repayment of the third tranche of BTSC debenture of THB 3,611.3 million, (2) dividend
payment of THB 2,493.5 million, (3) net cash paid for purchases of investments in
subsidiaries of THB 618.5 million and (4) cash paid for the purchase of BTS Group treasury
stock of THB 925.5 million.
6.
Industry Outlook
6.1 Mass Transit Industry
BTS Sky Train
Attachment 4 Page 17
The BTS SkyTrain is Thailand’s first elevated electric railway system and is
constructed above some of central Bangkok’s major public roadways. The network, which
includes the Core Network and its subsequent extensions, comprises 34 stations across 2
separate lines with a combined track length of 36.3km. The Sukhumvit Line, or the Dark
Green Line, currently consists of 22 stations and runs northwards and eastwards from
central Bangkok, connecting Mo Chit and Bearing. The Silom Line, or the Light Green Line,
currently consists of 13 stations and runs through one of Bangkok’s central business
districts, connecting National Stadium and Bang Wa. Both lines intersect at Siam station.
MRT Subway
The MRT Subway is Bangkok’s first underground mass transit railway system in
Thailand and commenced operation on 3 July 2004. Thenetwork currently consists of only
one line, the Metropolitan Rapid Transit System Chaloem Ratchamongkhon Line (Blue Line),
which runs 20.0km through 18 stations from Hua Lamphong to Bang Sue; however,
construction of a second line, which runs 22.0km and covers 16 stations from Khlong Bang
Phai to Tao Poon (Purple Line), is already underway and expected to commence operation
in 2016. The current system is connected to the BTS SkyTrain at three stations: Sala Daeng,
Asok and Mo Chit stations. In 2013, the MRT Subway trains carried a total of 86.4 million
passengers on the system.
Suvarnabhumi Airport Rail Link
The Suvarnabhumi Airport Rail Link (SARL) is a rapid transit line that connects
Suvarnabhumi Airport to Phaya Thai station in central Bangkok. The line is 28.5km long and
is elevated, running above the existing eastern railway, with an underground terminal at the
airport. It is owned and operated by State Railway of Thailand (SRT). The SARL
commenced its operations on 23 August 2010. There are a total of three lines: a 15-minute
non-stop SA Express Line that runs from Makkasan station to the airport, an 18-minute nonstop SA Express Line that runs between Phaya Thai station and the airport, and the City
Line, an approximate 30-minute commuter rail service with stops at eight stations from the
airport to Phaya Thai station. The SARL connects directly with the existing BTS SkyTrain at
concourse level at Phaya Thai station. From 14 April 2014 onwards, the SA Express Line to
Phaya Thai station has been temporarily suspended until further notice.
6.2 Media Industry
In 2013/14, Thailand faced growing political uncertainty amidst economic slowdown
which adversely affected consumer confidence, and had a knock-on impact on the media
sector. This was reflected in media sector stocks, as the Entertainment Index dropped
19.0% in the year ended 31 December 2013, the worst performing sub-index on the Stock
Exchange of Thailand. Moreover, total market value of the Thai media industry dropped by
0.9% to THB 113,408 million in 2013/14, far below the Media Agency Association of
Thailand’s expectations of 10.0% growth. The performance of the media industry has a
tendency to strengthen or weaken depending on the country’s economy, which can be
observed by the relationship between GDP growth and advertising spending growth from
2007/08 to 2013/14. Hence, it is deduced that the decline in 2013/14 advertising growth was
caused by the country’s economy and political unrest, as evident from GDP drop of 1.4%A, a
significant drop from 7.8% growth achieved in 2012/13
A
Remark: The data was recalculated based on fiscal year from April to March from the Office of the National Economic and
Social Development Board
Graph: Media Advertising Growth vs GDP Growth (2007/08 - 2013/14)
Attachment 4 Page 18
Source:: National Econo
omic and Socia
al Development Board. The Nielsen Company (Thailand) Co., Ltd
Graph: Media Industry Mark
ket Share in
n Thailand in 2013/14
4
S
Source:
The Nie
elsen Company (Thailand) Co.,, Ltd and Form 56-1
5
(FY2013/14) of BTSG
Advertising Expe
enditure in Thailand in
n 2013/14 vs
v 2012/13 (THB millio
on)
6.3 Property
In spite of the year’ss fluctuation
n, the overa
all residenttial propertyy market still grew
slightly in 2013. Th
he survey of
o the Real Estate Inforrmation Cen
nter shows that the nu
umber of
newly completed and regisstered houssing units in Bangko
ok and viccinities1 (B
Bangkok
Metropo
olitan Regio
on) in 2013
3 increased
d 4.1% Yo
oY from 125
5,000 unitss to 130,10
00 units.
Except for a reducction in num
mber of unitss launched of
o single de
etached hou
uses, other types of
newly constructed
c
d housing units incre
eased from the previo
ous year. Amongst the
t
new
projectss, condomin
nium projeccts represen
nted 53% of
o total unitss, followed by single detached
house, townhouse
e, commercial buildin
ngs and tw
win house at 24%, 13%, 8% and
a
2%,
respecttively. Acco
ording to th
he survey of Colliers Internation
naltotal, total newly la
aunched
Atta
achment 4 Pag
ge 19
condomimium units in Bangkok during 2013 was 51,150 units, an increase of 8% from the
previous year.
Newly Completed & Registered Housing Units in 2013 and 2012
(Unit: Units)
AREA
Total
Condominium
Y2013
Y2012
4,900
28,300
49,600
77,900
64,300
8,400
4,800
32,300
19,900
52,200
60,700
2,700
17,100
9,700
60,600
69,500
130,100
125,000
2
13
8
47
53
Single
detached
house
Twin
House
Town
Commercial
House
Building
Bangkok
13,700
1,000
8,700
Vicinities
17,400
1,700
Bangkok-Vicinities
31,100
Percentage
24
Source: Real Estate Information Center
Remark: Vicinities mean Nonthaburi, Pathumthani, Samut Prakarn, Samut Sakhon and Nakhon Pathom
Agency for Real Estate Affairs reveal the outlook of housing market in 2013, there
were a total of over 1.16 hundred thousand units totaling over THB 3.58 billion, which grew
about 5 percent from a year ago. Condominium is still number one selling, followed by town
house and single detached house, respectively which corresponds to the launch of new
projects.The average price of housing in the past year to 2.928 THB million, 0.3 percent
down from last year. This decrease is not due to the fall of housing price, but because the
operator adjust to smaller size housing so that they can sell housing at prices acceptable to
customers. At the end of 2013, the cumulative supply in market for old and new projects is
approximately 1.44 hundred thousand units, condominiums accounted for approximately
35.6 percent, town house 31 percent and single detachec house 25.9 percent.
Attachment 4 Page 20
Attachment 5
Special and/or significant agenda which requires approval of the Shareholders’ Meeting with not
less than three-quarters of votes pursuant to the applicable laws are summarized as follows:
Applicable Rules and
Regulations
Special/Significant Agenda
Favorable Votes of Shareholders’ Meeting
The Public Limited
Company Act and the
Company’s Articles of
Association
Sale or transfer of the whole or substantial
parts of the business of the Company to
other persons
Purchase or acceptance of transfer of the
business of other companies or private
companies by the Company
Execution, amendment or termination of
contracts with respect to the granting of a
lease of the whole or substantial parts of the
business of the Company
Entrustment of the management of the
business of the Company
Amalgamation of the business with other
persons for the purpose of profit and loss
sharing
Amendment of the Memorandum of
Association and the Articles of Association
Increase or decrease of the Company’s
registered capital
Issuance of debentures
Merger or dissolution of the Company
Favorable votes of not less than three-quarters
of all votes of the shareholders attending the
Meeting and having the voting rights
SEC Office
Notifications
Execution of connected transactions
Execution of significant transactions which
fall into the scope of an acquisition or
disposition of assets
Favorable votes of not less than three-quarters
of all votes of the shareholders attending the
Meeting and having the voting rights
Application for a waiver to acquire the capital
increase ordinary shares without making a
tender offer for all securities of the business
by virtue of the resolution of the
Shareholders’ Meeting (Whitewash)
Favorable votes of not less than three-quarters
of all votes of the shareholders attending the
Meeting and having the voting rights, without the
shareholders holding among them representing
at least 5 percent of all votes of the
shareholders attending the Meeting and casting
votes against (as the case may be)
Issuance of securities to directors or
employees (ESOP)
Offering of newly issued shares by way of
private placement at a price lower than 90.00
percent of the market price
Favorable votes of not less than three-quarters
of all votes of the shareholders attending the
Meeting and having the voting rights, without the
shareholders holding among them representing
at least 5 percent or 10 percent (as the case
may be) of all votes of the shareholders
attending the Meeting and casting votes against
the said offering of shares
Application for delisting of securities from the
Stock Exchange of Thailand or MAI
Favorable votes of not less than three-quarters
of the total issued shares, without the
shareholders holding among them representing
at least 10 percent of the Company’s total
issued shares casting votes against the
application for delisting of securities
Notifications of the
Stock Exchange of
Thailand
Attachment 5
Attachment 1
Company Information and Operating Results of
Natural Park Public Company Limited
1. General Information
Name
:
Natural Park Public Company Limited
Type of Business
:
Property Development
Website
:
http:// www.naturalpark.co.th
Address
:
88 Soi Klang (Sukhumwit 49), Sukhumwit Road, Wattana,
Bangkok 10110
Telephone
:
0-2259-4800-11
Fax
:
0-2260-5078
Registered Capital
:
THB 541,913,132,646
Divided into 541,913,132,646 ordinary shares with a par value of
Baht 1.00 per share
Paid-up Capital
:
THB 361,275,421,764
Divided into 361,275,421,764 ordinary shares with a par value of
Baht 1.00 per share
2. Nature of Business
2.1 Background
Natural Park Company Limited was established on 23 June 1988 to conduct the business
of full-range real estate development for lease, service, sale, and management. Its main office
is located at 88 Soi KLANG (Sukhumwit 49), Sukhumwit Road, Wattana, Bangkok 10110. The
Company was registered its conversion to a public company on 3 February 1994 under Natural
Park Company Limited and received a permission to trade in the Stock Exchange of Thailand
on 23 July 2003
2.2 Type of Business
The Company operates real estate development business in various types comprising.
(1) Real estate development for lease, service and hotel business: Main revenue in
2013 and 2014 was generated from (1.1) The Natural Park Apartment Project; (1.2) Centara
Hotel and Convention Center Khon Kaen, which officially opened for full-scale operation in
December 2013; and (1.3) Anantara Chiang Mai Resort and Spa, in which the Company
started investment in September 2014. Over 2013-2014, the Company gradually invested in
Prospect Development Company Limited (“Prospect”) at a total ratio of 19.81 percent of
Prospect's registered capital. Prospect operates a business of leasing warehouse and factory
spaces.
(2) Real estate development for sale: From 2013 up to the present, the Company
developed and launched sale for two projects, comprising (2.1) Park Ramindra Project which is
a low-rise condominium with 206 units of the 8-storey building and (2.2) Park Aran Project
which consists of (1) Park Aran Condo Project, a low-rise 8-storey condominium offering 512
Attachment 1 Page 1
units, and (2) Park Aran Boulevard Project, a three-and-a-half-storey commercial building with
62 units.
2.3 Investment Structure of the Company as of 30 September 2014
The Company’s investments in subsidiaries and associated companies are as follows.
No
Company Name
Office Location
Percentage
of the
Company's
shareholding
Paid-up
Capital
Registered
Capital
Shares
Offered
Par
Value
(THB)
(THB)
(Shares)
(THB)
Real estate business for rent, service and hotel
1
Khon Kaen Buri Company Limited
operates a hotel business
999 Moo 4 Prachasamosorn Road, Nai
Muang Sub-district, Muang Khon Kaen
District, Khon Kaen Province
100.00%
800,000,000
800,000,000
8,000,000
100
13.56%1/
1,200,000,000
1,200,000,000
120,000,000
10
100.00%
1,000,000
1,000,000
10,000
100
100.00%
700,000,000
700,000,000
7,000,000
100
Telephone 043 209 888
Fax 043 209 889
2
Prospect Development Company
Limited operates a business of
leasing warehouse and factory
spaces
48/23 Tisco Tower, 12 A Floor, North
Satorn Road, Silom Sub-district, Bang
Rak District, Bangkok
Telephone 02-697-3860
Fax 02-697-3869
3
Npark Global Holding Company
Limited is to holding company for
local and foreign investment in hotel
and / or real estate business
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
4
Boonbaramee Metta Propety
Company Limited *
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
* : Investment in hotel and real estate development business by investing in 2 companies, namely:
1) Pacific Hotel Chiangmai Company Limited, having 600,000,000 Baht in registered and paid-up capital, at a par value of 100 Baht each, Pacific Hotel
Chiangmai Company Limited operates a hotel business under the name of “Anantara Chiang Mai Resort & Spa Hotel,” located on Charoen Prathet Road, Changklan
Sub-district, Muang Chiang Mai District, Chiang Mai Province.
2) Pacific Chiangmai Company Limited having 200,000,000 Baht in registered and paid-up capital, at a par value of 100 Baht each, Pacific Chiang Mai
Company Limited operates a business of leasing land and structures to Pacific Hotel Chiang Mai Company Limited
5
N Park (US) , LLC Company Limited
operates Investment in hotel and / or
real estate business
Registered in USA
100.00%
USD 200
99.30%
100,000
100,000
1,000
100
99.94%
1,000,000
1,000,000
10,000
100
50.00%
5,000,000
5,000,000
100,000
50
100,000
100,000
10,000
10
Business of real estate development for sale
1
Natural Hotel Chaophraya Company
Limited operates a business of real
estate development
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-697-3860
Fax 02-697-3869
2
Natural Project Chaophraya
Company Limited operates a
business of real estate development
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
3
K Park Company Limited
operates a business of real estate
development
88 Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
Joint venture
Joint Venture of The Natural Park
Public Company Limited,
Amanresort Services Limited and
Silverlink Holding Limited
An associated company
1
MHG NPARK Development
Company Limited, is to property
development
12th floor Berli Jucker housr, 99 Soi
Rubia Sukhumvif 42 Road, Kwaeng
Phhrakanong Sub-district, Klongtoey
District, Bangkok
50.00%
(remainly
50% by Hua
Hin Resort
Limited)
Attachment 1 Page 2
No
Company Name
Office Location
Percentage
of the
Company's
shareholding
Paid-up
Capital
Registered
Capital
Shares
Offered
Par
Value
(THB)
(THB)
(Shares)
(THB)
A group of companies that have not yet operated a business
1
Natural Hotel Panwa Company
Limited
is to operate a
hotel business
5/3 Moo 8 Yon Bay-Khao Khard Road,
Wichit Sub-district, Muang Phuket
District, Phuket Province
100.00%
143,000,000
143,000,000
1,430,000
100
2
Natural Hotel Sukhumvit Company
Limited is to operate a hotel
business
555/5 Soi Sukhumvit 63 (Ekamai),
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
71.57%
41,352,750
150,000,000
1,500,000
100
5
Natural Park Ville Company Limited
is to operate a management
business
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
100.00%
43,000,000
43,000,000
430,000
100
100.00%
33,000,000
33,000,000
330,000
100
100.00%
22,555,000
50,000,000
5,000,000
10
99.94%
1,000,000
1,000,000
10,000
100
100.00%
25,000,000
50,000,000
500,000
100
Telephone 02-2594800
Fax 02-2605078
6
Natural Real Estate Company
Limited
is to operate
a real estate development business
88
Soi
Klang
(Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
7
Park Opera Company Limited
is to operate a real estate
development business
88 Soi Klang (Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
8
Richee Property Management
Company Limited
is to operate a real estate
development business
88 Soi Klang (Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
9
Park Gourmet Company Limited
is to operate a restaurant business
88 Soi Klang (Sukhumvit 49)
Sukhumvit Road, Klongton Nua Subdistrict, Wattana District, Bangkok
Telephone 02-2594800
Fax 02-2605078
1/
Remarks: The Board of Directors of the Company No.16/2014 held on 15 October 2014 resolved to approve the purchase of
additional 7,500,000 ordinary shares in Prospect Development Co., Ltd of at par value of THB 10 per share, totaling THB
75,000,000 from Chainan-Bangplee Parkland Co., Ltd., which is additionally acquired 6.25 percent of ordinary shares in Prospect,
bringing its total shareholding to 19.81 percent of total paid up capital of Prospect.
2.4 Revenue Structure
Company’s revenue structure by product
Business
Operated by Percentage
of the
Company's
shareholding
2011
Revenue
2012
%
Revenue
(Million
Baht)
2013
%
Revenue
(Million
Baht)
Quarter 3/2014
%
Revenue
(Million
Baht)
%
(Million
Baht)
Property Development for Rent, Service
Business of space rental and services
- The Natural Park Apartment
Natural Park
PCL
100.00
60.34
11.68
77.04
9.44
94.26
12.34
72.28
31.37
Khon Kaen
Buri Co., Ltd
100.00
-
-
-
-
92.67
12.13
119.18
51.72
- Anantara Chiangmai Resort and Spa Pacific Hotel
Hotel
Chiangmai
Co.,Ltd
100.00
-
-
-
-
-
-
12.67
5.50
- Interest receivable
6.11
1.18
9.82
1.20
33.47
4.38
11.66
5.06
- Dividend earning
3.54
0.68
7.38
0.90
2.21
0.29
-
-
26.70
5.17
0.11
0.01
0.27
0.03
0.25
0.11
Hotel business
- Centara Hotel & Convention
Khon Kaen
Other Revenue
- Gains on foreign exchange
- Gain on disposal of property
- Gain on sale of investment in related
-
-
0.49
0.06
-
-
-
-
193.12
37.39
44.13
5.41
44.33
5.80
-
-
Attachment 1 Page 3
Business
Operated by Percentage
of the
Company's
shareholding
2011
Revenue
2012
%
Revenue
(Million
Baht)
2013
%
Revenue
(Million
Baht)
Quarter 3/2014
%
Revenue
(Million
Baht)
%
(Million
Baht)
company
- Reversal of allowance for doubtful
-
-
4.16
0.51
-
-
-
-
-
-
294.29
36.04
0.86
0.11
-
-
accounts-other receivables
- Gain on sale of investment in
associated company
- Gain on debt restructuring
208.06
40.28
320.97
39.31
330.25
43.2
-
- Gain on price negotiation
-
-
-
-
164.02
21.47
-
-
- Gain on sale of investment in
-
-
43.99
5.39
5.70
2.47
18.70
3.62
14.14
1.73
8.69
3.77
subsidiary
- Others
Total Revenue
516.57 100.00
816.52 100.00
1.72
0.23
764.06 100.00
230.44 100.00
Source: Form 56-1 of NPARK and Financial statement as at September 30, 2014 which has been reviewed by Karin Audit Co., Ltd (an approved
auditor by the Office of the SEC).
Remarks: * In 2013, the Company did not generate revenue from real-estate development for sale because the Company launched and sold the Park
Ramindra Project but did not realize revenue until ownership transfer per the Revenue Recognition Criteria under accounting standard and the
Company's accounting policy
3. List of Shareholders
Top 10 major shareholders of NPARK as of November 13, 2014 (the latest book closing
date) are as follows:
No.
Name of Shareholders
Number of Shares (Shares)
% Shareholding
1.
Phillip Securities Pte Ltd.
59,950,000,000
16.59
2.
UOB KAY HIAN (HONG KONG) LIMITED - Client Account
11,732,528,000
3.25
3.
Mr.Wanchai Panwichien
10,650,000,000
2.95
4.
Mr. Somkiet Chatsakulwilai
9,580,091,572
2.65
5.
Mrs.Sukalaya Thongphun
8,995,375,650
2.49
6.
Thailand Securities Depository Company Limited
6,669,142,265
1.85
7.
Mr.Komol Jungrungreangkit
6,034,542,672
1.67
8.
Mr. Thongplew Siripornpitak
5,403,914,122
1.50
9.
Mr.Chaiyan Chakarakul
4,900,489,608
1.36
10.
3,200,000,000
0.88
Total of 10 major shareholders of the company.
Mr.Netnthirat Pongnarajsorn
127,116,083,889
35.19
Other
234,159,337,875
64.81
Total
361,275,421,764
100.00
Source: Thailand Securities Depositary Co., Ltd.
4.
Board of Directors
List of NPARK’s Board of Directors as of November 24, 2014 are as follows.
No.
Name of Directors
Position
1
Mr. Sakthip
Krairiksh
Chairman of the Board of Directors and Independent Director
2
Mr. Chaiwat
Atsawintarangkun
Chairman of the Audit Committee and Independent Director
3
Mr. Thavisakdi
Tanta-Nanta
Audit Committee and Independent Director
4
Mr. Manu
Maniwatana
Audit Committee and Independent Director
5
Mr. Nakorn
Laksanakarn
President and Chief Executive Officer
6
Mr. Burin
Pusiri
Director and Executive Officer
7
Mr. Weerawat
Wattanatchariya
Director and Executive Officer
Source: www.set.or.th
Attachment 1 Page 4
5. Summary of Financial Highlights and Analysis of Operational Performance and
Financial Status of NPARK
Statement of Financial Position
(Unit: THB million)
Statement of Financial Position
2011
Assets
Current assets
Cash and cash equivalents
Current Investments
Trade accounts receivable and other accounts
receivable - net
Amounts due from related parties - net.
Short-term loans to related parties and interest
receivable - net
Inventories
Real estate projects under development
Deposits for land purchase
Other current assets - net
Total current assets
Non - current assets
Pledged deposits at financial institutions - long term
Investments in available-for-sale securities
Investments in subsidiaries - net
Investments in associates - net
Investments in related companies - net
Other long-term investments - net
Land waiting development
Investment properties - net
Property, plant and equipment - net
Leasehold rights of land and buildings - net
Goodwill
Intangible assets - net
Other assets - net
Total non-current assets
Total assets
Liabilities and shareholders’ equity
Current liabilities
Overdrafts and short-term loans from financial
institutions
Trade accounts payable and other accounts payable
Short-term loans from other companies
Long-term loans from banks stated under current
liabilities
Current portion of long-term loans
Short-term loans from related parties and accrued
interest
Other short-term loans
Current portion of obligation under debt restructuring
agreement
Deposits and advances received from customers
Provision for liabilities
Current portion of obligation under finance lease
2012
2013
Quarter
3/2014
37.85
13.22
160.16
195.36
13.77
1,267.77
100.10
75.34
260.70
0.10
62.50
0.13
55.78
0.13
-
0.13
-
0.13
0.00
24.05
131.03
9.67
379.10
3.28
572.10
62.05
2,080.77
9.16
756.98
748.09
34.67
1,872.33
50.65
44.63
45.52
509.04
299.89
0.12
124.30
109.12
97.31
151.26
79.90
0.19
111.78
118.75
93.14
162.90
93.51
2,228.66
88.97
746.48
1,936.92
722.72
1,322.38
12.81
973.53
3,605.91
47.14
2.24
0.00
0.05
0.00
162.97
817.65
80.50
3,843.23
85.86
79.31
14.10
185.99
5,319.04
2,067.95
1,701.47
5,686.68
7,191.36
-
-
-
18.61
90.53
56.24
110.49
157.33
197.55
41.08
25.20
13.12
25.20
-
45.14
-
57.64
-
112.47
646.13
-
25.00
-
25.00
5.78
14.82
724.87
-
19.36
623.03
2.12
24.30
3.88
107.19
3.75
Attachment 1 Page 5
Statement of Financial Position
2011
2012
2013
Quarter
3/2014
Income tax liabilities
Other current liabilities
Total Current Liabilities
Non-Current Liabilities
Obligation under debt restructuring agreement
Long-term loans - net
Estimated liability – employee benefit
Obligation under finance lease
Income tax liabilities
Other non-current liabilities
Total Non-Current Liabilities
10.34
1,637.48
2.44
728.37
34.16
242.97
25.38
639.30
55.32
5.81
58.58
119.71
36.41
6.79
5.73
2.40
51.33
925.49
8.65
6.31
2.40
942.84
1205.42
879.74
19.00
3.61
212.49
2.40
2322.66
Total Liabilities
1,757.19
779.70
1,185.81
2961.96
60,430.92
120,861.84
-
180,637.71
-
541,913.13
-
60,430.92
(51,688.71)
(87.43)
(8,344.08)
310.70
66,925.14
(58,053.05)
16.68
(7,967.57)
921.20
180,637.71
(168,467.96)
(0.04)
(7,671.75)
4,497.96
180,637.71
(168,467.96)
0.02
(7,942.72)
4,227.06
0.06
310.77
0.57
921.77
2.91
4,500.87
2.35
4,229
2,067.95
1,701.47
5,686.68
7,191.36
Shareholders’ Equity
Share capital
Registered
541 913 132 646 ordinary shares of THB 1 each
180 637 710 882 ordinary shares of THB 1 each
120,861,840,000 ordinary shares of THB 1 each
60,430,920,000 ordinary shares of THB 1 each
Issued and paid - up
180 637 710 882 ordinary shares of THB 1 each
66,925,140588 ordinary shares of THB 1 each
60,430,920,000 ordinary shares of THB 1 each
Discount on ordinary shares
Other components of shareholders’ equity
Deficit
Total shareholders’ equity attributable to the
Company
Non controlling interest
Total Shareholders’ Equity
Total Liabilities and Shareholders’ Equity
Source: Form 56-1, Consolidated Financial Statements of NPARK for the period ended September 30, 2014.
Attachment 1 Page 6
Statement of Comprehensive Income
(Unit: THB million)
Statement of Comprehensive Income
2011
2012
2013
Quarter
3/2014
Profit and Loss Statement
Revenue
Income from rental and services
Revenue from hotel business
Other income
Gain on sale of investments
60.34
263.11
193.12
77.04
739.49
-
94.26
92.67
577.13
-
72.28
131.85
26.31
-
Total Revenue
516.58
816.53
764.06
230.44
Expenses
Cost of rental and services
Cost of hotel business
Selling expenses
Administrative expenses
Provision for liabilities
Finance costs
Share of loss from investments in associates
50.77
3.27
273.61
58.29
46.22
192.71
56.66
6.51
163.86
77.02
18.26
117.20
56.36
90.13
15.52
187.53
9.51
81.42
27.93
40.54
124.36
45.99
205.18
84.84
-
Total Expenses
624.88
439.51
468.40
500.92
(108.30)
(0.07)
(108.37)
377.02
377.02
295.66
295.66
(270.48)
(270.48)
-
-
-
(1.05)
(11.47)
-
-
-
(211.50)
(222.97)
(331.34)
88.05
88.05
465.07
(16.72)
(16.72)
278.94
0.07
(0.99)
(271.47)
(108.31)
(0.06)
(108.37)
(327.45)
(3.88)
(331.34)
376.51
0.51
377.02
464.56
0.51
465.07
295.82
(0.16)
295.66
279.10
(0.16)
278.94
(269.92)
(0.56)
(270.48)
(270.91)
(0.56)
(271.47)
(0.0018)
0.0059
0.0021
(0.00149)
Profit (loss) before income taxes
Income tax
Profit (loss) for the year
Other Comprehensive Income
Profit (loss) from actuarial estimates
Exchange differences on translation of financial
statements
Unrealized gain on available-for-sale securities
Comprehensive Income
Total Comprehensive Income
Profit (loss) attributable to:
Owners of the parent
Non controlling interest
Total comprehensive income attributable to:
Owners of the parent
Non controlling interest
Basic profit (loss) per share attributable to the equity
of the parent
Net Profit (loss) for the year (THB/share)
Source: Form 56-1, Consolidated Financial Statements of NPARK for the period ended September 30, 2014.
Attachment 1 Page 7
Statement of Cash Flow
(Unit: THB million)
Statement of Cash Flow
2011
2012
2013
Quarter
3/2014
Cash flows from (used in) operating activities.
(211.32)
(642.81)
(977.80)
(1,099.74)
Cash flows from (used in) investing activities.
455.72
672.43
(765.44)
(56.57)
Cash flows from (used in) financing activities.
(442.82)
92.70
2,850.85
149.23
Cash and cash equivalents Increase (decrease) in
cash
(198.42)
122.32
1,107.61
(1,007.08)
Source: Form 56-1, Consolidated Financial Statements of NPARK for the period ended September 30, 2014.
Summary of Key Financial Ratios
Financial Ratios
2011
Current Ratio
(times)
2012
2013
Quarter
3/2014
0.08
0.52
8.56
2.93
Net margin
(%)
15.86
26.46
21.64
N/A*
Gross margin
(%)
(33.50)
46.17
38.70
N/A*
Return on equity (ROE)
(%)
(22.47)
61.18
10.90
N/A*
(%)
(4.27)
20.00
8.00
N/A*
5.65
0.85
0.26
0.70
Return on assets (ROA)
Debt-to-equity ratio (D / E Ratio)
(times)
Source: Form 56-1 for Natural Park Public Company Limited
Note: Non-Applicable. The Company incurred a net loss
Analysis of financial status and operating performance
Business Operational Overview 2013 and Important Events in Relation to Investment
inSubsidiaries/ Jiont Venture
In March 2013, the Company purchased ordinary shares of Prospect Development Co.,
Ltd. (“Prospect”) from the former shareholder at the rate of 13.56 percent of total paid up capital
of Prospect. Prospect engages in the business of warehouses and factories for rent, located in
Bangkok Free Trade Zone, Bangsaothong Sub-District, Samuthprakarn Province. The
Company recorded such investment at cost price and did not realize operational performance
(equity method) because Prospect is not considered as an affiliate. In October 2014, the
Company additionally acquired 6.25 percent of ordinary shares in Prospect, bringing its total
shareholding to 19.81 percent of total paid up capital of Prospect.
In April 2013, the Company invested in hotel business by purchasing total ordinary
shares of Khon Kaen Buri Co., Ltd. (“KhonKaenBuri”) from its former shareholders. Khon Kaen
Buri Co., Ltd. (“Khon Kaen Buri”) engages in hotel busniness under the name of Centatra
Convention Center Khon Kaen. As a result of purchasing of shares, operational performance of
the group of companies in 2013 started to generate income increased from hotel business at
the beginning of investment. Centatra Convention Center Khon Kaen has completely and
officially started operation from early of Decemeber 2013; as a result, income from hotel
business began to reflect actual operational performance from the end of 2013 onward.
Later in September 2013, the Company sold out total ordinary shares held in Park
Cuisine Co., Ltd. (“Park Cuisine”) at the rate of approximately 38 percent of the paid up capital.
Park Cuisine engages in management of LENOTRE restaurant for other people since Park
Cuisine has been confronting loss continuously that Park Cuisine had total of deficit over the
capital. The Company formerly realized loss equavalent to total investment according to equity
method.
In additions, in August 2013, the company has launched the first real estate project for
sell, Park Ramindhra Project which is a horizontal condominium with of 8 floors, 1 building and
Attachment 1 Page 8
206 rooms, locate on Ramindhra Road Soi 47, Bangkok with total booking as at the end of 2013
at the rate of 90 percent of total rooms. The aforesaid project will begin its construction in 2014
and expected to be finished in 2015.
In February 2014, the company has launched Park Aran Condo Project and Park Aran
Boulevard Project with total booking as at the quarter 3 of 2014 at the rate of 60 percent and
100 percent respectively of total rooms. The aforesaid project will expected to be finished in
2015 and at the end of quarter 4 of 2014 respectively.
In September 2014, the Company invested in a hotel business by acquiring the entire
ordinary shares in Boonbaramee Metta Property Co., Ltd. (“Boonbaramee”) from the existing
shareholders. Boonbaramee itself is a sole shareholder of Pacific Hotel Chiang Mai Co., Ltd.
and Pacific Chiang Mai Co., Ltd. Pacific Hotel Chiang Mai Co., Ltd. operates a hotel business
under the name, Anantara Chiang Mai Resort and Spa. Thus, with respect to the consolidated
performance, NPARK Group began to generate revenue from hotel business operation as from
the launch of such investment in 2014.
As a result, consolidated operational performance of the Company from 2013 to Quarter
3/2014 shall be comprise operational performance from real estate development for rent,
services, and hotel business only, provided that operational performance from real estate
development for sell may occur in the year when the Company realizes income in the future
thereon.
Overall Performance
Operational Performance of the Company for the period 2011-2012, the Company and
subsidiaries had derived income from the business of real estate development for rent and
services with the main income was from the Natural Park Apartment project which is an
apartment for rent whilst in 2013 income comprise of (1) income from real estate development
for rent, services business and (2) income from hotel business as in Quarter 2, the Company
invested in Centara Convention Center Khon Kaen by holding 100 percent of total shares.
Therefore, in the explanation, this shall be separated into 2 business which are real estate
development for rent, services business and hotel business.
Total Revenue
In 2013, the Company had total income of THB 764.06 million, decreased THB 52.47
million or 6.43 percent from 2012. Details are as follows.
-
Income from Services
In 2013, the Company had income from rent and related services in the amount
of THB 94.26 million, increased from 2012 equivalent to 22.36 percent as a result of
the increasing on occupancy rate of the Natural Park Apartment of the prior year by
increasing from the rate of 70 percent in 2012 to 84 percent in 2013 which was a result
of marketing strategy implement by concentration on group of companies and large
internation institutes, and embassy customers which have more purchasing power and
long term lease agreement execution. The average rate of monthly rental in 2012 is
THB 101,000 which is considered higher than average rental rate of the same area,
whilst monthly rental rate of 2013 had slightly increased to THB 103,500.
-
Revenue from Hotel Business
Revenue from hotel business in 2013 derived from the acquisition of total
ordinary shares of Khon Kaen Buri in Quarter 2 in 2013. Khon Kaen Buri carries on
hotel business under the name of “Centara Convention Center Khon Kaen” and was
managed by Centara Group of Central Plaza Hotel Public Co., Ltd. according to the
service agreement. For the beginning period of investment, the hotel was not fully
operated and was under renovation and decoration. The Centara Convention Center
Khon Kaen was fully and official operated in early of December 2013, therefore,
Attachment 1 Page 9
revenue from hotel business reflected actual operational performance from the end of
2013 onward.
In 2013, the Company had revenue from hotel business in the amount of THB
92.67 million derived from food and drink income, room rate income and others
equivalent to 65.17, 33.89, and 0.94 percent respectively of total revenue from hotel
business. The average occupation rate in 2013 is 50.20 percent.
-
Other Revenue
In 2013, the Company had other income of THB 577.13 million, decreased from
2012 which was THB 739.48 million, provided that other income in 2013 mainly derived
from
A. Profit from the debt restructuring in the amount of THB 330.25 million, 57.22
percent of other income from the repayment under Debt Restructuring
Agreement with (1.1) the receiver of Thana Nakorn finance and security
Public Co., Ltd. in March 2013, in the amount of THB 37.48 million (1.2) the
receiver of Maha Nakorn Trust Security Public Co., Ltd. in March 2013, in
the amount of THB 49.36 million and ICBC (Thai) Public Co., Ltd. (former
name Sin Asia Bank Public Co., Ltd. in June 2013, in the amounf of THB
243.43 million.
B. Profit derived from the price negotiation in investment in the Khon Kaen Buri
Co., Ltd. in the amounf of THB 164.02 million, or 28.42 percent of other
income.
While other income in 2012 mainly derived from (1) the profit from debt
restructuring with KrungThai Bank Public Co., Ltd. and Bangkok Commercial Asset
Mangement Co., Ltd. in the amount of THB 320.97 million and (2) the profit from selling
investment in the affiliate company (Kampin Siam Co., Ltd.) in the amount of THB
294.29 million, or 43.30 percent or 39.80 percent of other income, respectively.
The total revenue of the Company and its subsidiaries for the nine-month period of the
year 2014 was THB 230.44 million, decreasing by THB 441.60 million or 65.71 percent when
compared with the Company's total revenue for the nine-month period of the year 2013 which
was THB 672.04 million. Such change was resulted from the fact that the Company had gain
from debt restructuring totaling THB 330.26 million and from negotiation on acquisition totaling
THB 139.62 million in 2013. These factors, in spite of more revenue from hotel operation
totaling THB 70.26 million in 2014, resulted in decrease in 2014 total revenue of the Company.
Cost of Services
In 2013, the Company generated revenue from real estate development business for rent
in the amount of THB 56.36 million, decreased by 0.53 percent from the previous year and
equivalent to the propotion of 59.79 percent of revenue from services in 2013 which decreased
from 73.54 percent of revenue from services in 2012.
Costs of service structure were mainly fixed costs compreised of salary and welfare, land
rental, other service according to hire of work contract, e.g. gardening fee, cleaning fee and
security fee etc. including depreciation. Therefore, the costs of service was almost the same as
former year whilst the ratio of costs of service and revenue from services in 2013 decreased
from 2012 since the revenue from services in 2013 was 22.36 percent grew from 2012 as
mentioned above. As a result, gross profit margin also increased.
For the first nine months of 2014, cost of services in the real estate development for rent
business amounted to THB 40.54 million which dropped by 4.56 percent from the same period
last year.
Attachment 1 Page 10
Direct Costs of Hotel Business
The Direct costs of hotel business consisted of depreciation and amaltization, costs of
food and drink, salary and others. The depreciation and amaltize were major direct costs which
is 47.52 percent of total direct costs. The Direct costs of hotel business in 2013 are THB 90.13
million which was equivalent to 97.26 percent of total revenue.
The direct costs of hotel business in the first nine months of 2014 were THB 124.36
million which increased by THB 50.54 million or 68.46 percent from the same period last year.
The reason of such change is that Centara Convention Center Khon Kaen had just become fully
operated. Direct cost of hotel business accounts for 71.93 percent of revenue from hotel
business.
Selling and Administrative Expenses
In 2013, the Company had selling and administrative expenses in the amount of THB
203.05 million, increased by THB 32.68 million or 19.18 percent from 2012 which was THB
170.37 million. The most increasing expenses were from the investment in hotel business in
2013. However, this increasing ratio is less than the increasing of operation revenue (Real
Estate Development for rent and servicese and hotel business) in 2013, which increased by
THB 109.89 million, or 142.65 percent from 2012. The selling expenses which was increased by
THB 9.01 million was from the expenses from starting hotel business in this year, in the amount
of THB 11.35 million while the expenses of the Company decreased in the amount of THB 2.34
million resulted from the internal operating expenses. The increased operating expense in the
amount of THB 23.68 million was a result of hotel business. The selling and administrative
expenses structure for 2013 was selling expenses, 7.64 percent and administrative expenses,
92.36 percent of all selling and administrative expenses. The operating expenses structure
mainly consisted of salary, director allowance, consulting fee, audit fee, fee paid to SET and
others etc. While the selling and administrative expenses structure of 2012 was selling
expenses, 3.82 percent and administrative expenses, 96.18 percent of total selling and
adimistrative expenses.
For the first nine months of 2014, the Company recorded selling and administrative
expenses of THB 251.18 million, soared by THB 103.78 million or 70.41 percent year-on-year.
Selling expense was THB 45.99 million, increased by THB 36.76 million or 397.82 percent from
the same period last year and administrative expense was THB 205.16 million, increased by
THB 67.03 million or 48.51 percent compared to the same period last year.
Gross Profit from operation
Real Estate Development for Rent and Services
In 2013, gross profit margin of this business equivalent to THB 37.91 million in 2013,
increase to 85.97 percent and gross profit margin rate increased to 40.21 percent in 2013 from
26.46 percent in 2011.
For the first nine months of 2014, the Company recorded gross profit of this business of
THB 31.74 million, increased by 16.22 percent compared to the same period last year and had
an increase in gross profit margin to 43.91 percent from 39.13 percent from the same period
last year.
Hotel Business
The Company had gross profit margin THB 2.54 million or 2.74 percent of total revenue
from hotel business. Since the Company had fixed cost i.e. depreciation and amaltization
expenses and salary but the hotel was not fully operated, as a result, the cost of services for the
first year operation was quite high.
For the first nine months of 2014, the Company recorded gross profit of hotel business
of THB 7.49 million, accounting for 5.68 percent of revenue from hotel business. Because two
hotels have been fully operated and cause a higher operationg cost.
Attachment 1 Page 11
Net Profit (Loss)
In 2013, the Company had net profit in the amount of THB 295.66 million (devided into
profit of Equity shareholders in the amount of THB 295.82 million and Equity of Related persons
who have no control in subsidiary company (realized loss) in the amount of Baht (0.16) million),
decreased from previous year in the amount of THB 81.36 million or 21.58 percent which is a
part of profit from selling investment in affiliated company (Kampin Siam Co., Ltd.) occred in
2012 in the amount of THB 294.29 million and financial cost which was increased from the
starting of hotel business in the amount of THB 63.61 million although, in 2013 the Company
had profit from the price negotiation in investment in Khon Kaen Buri Co., Ltd. in the amount of
THB 164.02 million and estimiated liability which was decreased by THB 67.51 million.
For the first nine months of 2014, the Company recorded a net loss of THB 270.48
million. This loss is attributable to shareholders of THB 269.92 million and non-controlling
interest of THB 0.56 million.
Financial Status
Assets
As of 31 December 2013, the Company had total assets in the amount of THB 5,686.68
million, increased by 234.22 percent from ending of 2012 as a consequence of (1) Land
Building and Equipment from the starting of hotel business operation which increased in the
amount of THB 2,109.91 million, or 52.94 percent of the increased total asset (2) Cash and
Cash equivalent which increased in the amount of THB 1,107.61 million, or 27.79 percent of the
increased total asset as a result of capital increase in 2013, and (3) Real Estate Project under
development which increased in the amount of THB 572.10 million or 14.36 percent of the
increased total asset which consisted of Land, Land improvement, Construction cost and
project expenses for The Park Ramintra (Start selling in 2013) and Project waiting development
for 3 projects i.e. The Park Aran Condo, The Park Aran Boulevard which will start selling in
2014 and the project under study.
The Company’s asset structure at ending of 2013 consisted of non current assets, and
current assets, 63.41 and 36.59 percent, respectively.
The major non current asset consisted of (1) Net Land Building and Equipment (mostly
assets of hotel business) and (2) The other non current asset (mostly waiting development),
39.19 and 17.12 percent of total asset, respectively.
The major current asset consisted of (1) Cash and cash equivalent and (2) Real Estate
Project under development, 22.29 and 10.06 percent of total asset, respectively.
As of September 30, 2014, the Company had total assets of THB 7,191.36 million,
growing by 26.46 percent from the end of 2013. Such asset growth was mainly ascribed to an
increase in land, building and equipment of THB 1,614.56 million or 72.45 percent of the
increased asset value.
Liabilities
As of 31 December 2013, the total liabilities of the company were in the amount of THB
1,185.81 million, increased by 52.09 percent from ending of 2012. The increased liabilities were
mainly from the increase of long-term loan in hotel business, approximately THB 929.64 million
and account payable in the amount of THB 54.28 million or increased by 218.93 and 13.37
percent of the increased total liabilities. However, the Company had already repaid debt under
Debt Restructuring Agreement with creditor which recorded as accured expenses in 2013 as a
result, this estimated liabilities was not further appeared in balance sheet at the end of 2013
(estimated liabilities at the end of 2012 in the amount of THB 623.03 million)
The liability structure of the Company at the end of 2013 consisted of non-current
liabilities and current liabilities, 79.51 and 20.49 percent of total liabilities, respectively.
Attachment 1 Page 12
The almost of non-current liabilities was long term loan for hotel business, 78.05 percent
of total liabilities.
Almost of current liabilitiese consisted of (1) Account payable and other creditor and (2)
long term loan due within one year, 9.32 and 3.81 of total liabilities, respectively.
As of September 30, 2014, the Company had total liabilities of THB 2,961.96 million,
mounting by 149.78 percent from year-end 2013. Such dramatic increase largely came from a
surge in non current liabilities such as long-term loan for hotel business of around THB 1,205.42
million and income tax liabilities of THB 212.49 million and current liabilities such as short term
loans from other companies of THB 197.55 millions.
Shareholders’equity
As of 31 December 2013, the Company had shareholders’ equity in the amount of THB
4,500.87 million, increased by 388.29 which strengthened the Company’s financial status in
comparation with the previous year. The increased shareholders’ equity was from increase in
capital in the amount of THB 3,297.66 million Baht and net profit in 2013 in the amount of THB
295.82 million provided. The Company still had deficit in the amount of THB 6,991.05 million
(Specific Buiness Financial Statement), therefor the Company could not distribute dividend to
shareholders according to the law.
As of September 30, 2014, the Company had total shareholders’ equity of THB 4,229.41
million, decreased by THB 271.47 million or 6.03 percent from year-end 2013.
Liquidity
Cash and Cash equivalents
The Company’s cash and cash equivalent brought forward from 2012 was THB 160.16
million. The Company have cash used in operating activities in the amount of THB 977.80
million, cash used in investment activities in the amount of THB 765.44 and cash received from
investment activities in the amount of THB 760.44 million and cash received from fund raising
activities in the amount of THB 2,850.85 milllion, therefore in 2013 cash flow was increased by
THB 1,107.61 million causing cash and cash equivalent at the end of 2013 equal to THB
1,267.77 provided that significant cash received was cash increased from selling of increase on
capital ordinary shares in the amount of THB 3,297.66 million.
According to the Company’s operating activities in 2013, the Company had loss from
operation before change of assets and liabilities in the amount of THB 72.72 million and the
Company used most of cash flow in real estate development project in the amount of THB
572.09 million and acquisition of land awaiting development and building in the amount of THB
219.29 million.
According to investment activities in 2013, the Company used most of cash in acquisition
of investments property, building and equipment in the amount of THB 162.71 million, total cash
paid for acquisition of subsidiaries in the amount of THB 577.54 million, acquisition of long-term
investment in the amount of THB 162.74 million, advance cash paid for share capital in the
amount of THB 187.50 million.
According to fund raising activities in 2013, the Company had cash flow received from
capital increase in the amount of THB 3,297.66 million and other short-term loans in the amount
of THB 25.00 million whilst cash flow paid was paid for liabilities under debt restructuring in the
amount of THB 302.29 million and cash flow paid for long-term loans to financial institutes and
long-term loan from direcotrs in the amount of THB 169.53 million provided that the Company
have not distributed dividends to the shareholders.
As of September 30, 2014, the Company had a decrease in net cash flow of THB
1,007.08 million. This is attributable to Cash used in operating activities of THB 1,099.74 million,
Cash used in investment activities of THB 56.57 million and Cash received form fund raising
activities of THB 149.23 million.
Attachment 1 Page 13
6. Industry Outlook
Serviced Apartment Business
Bangkok’s serviced apartment market has grown slowly in the last few years, due to fierce
competition following the mushrooming of condominium along the BTS line. Serviced
apartments in Bangkok saw declining growth rate since 2009 and will continue to exhibit this
declining trend due chiefly to both soaring land prices and the changing preferences of foreign
tourists and expats, who make up the bulk of the market. However, occupancy and rental rates
of the second quarter of 2014 went up slightly.
The total supply of serviced apartments in Bangkok is approximately 18,280 units in the
second quarter of 2014 and expected to increase to 18,720 units at the end of 2014. Sukhumvit
Road remains the most popular area for developers and lessees, with higher occupancy and
rental rates than other locations.
Although the number of foreigners granted work permit to work in Bangkok continued to
increase in the past few years, they have many residential options. Condominiums and serviced
apartments along the BTS lines in Sukhumvit Road, which offers various facilities apart from
convenient transportation, are mostly popular. The upper Sukhumvit area had highest
occupancy and rental rates of the second quarter of 2014.
The serviced apartment market at present has intense competition because of increasing
of new apartment and condominium projects. Most expatriates working in Bangkok prefer to
stay outside a business district, but not a distance from the BTS or MRT, at lower rental rates.
However, the implementation of the Asean Economic Community in 2015 will allow more
foreigners to work in Thailand which will be the positive factor to drive serviced apartment
market in the future.
Source: Colliers International (Thailand)
Hotel Business
The overall hotel market in Thailand in the first half of 2014 was still flat. Tourist
confidence has been negatively affected by the continuing political turmoil that arose at the end
of 20131, evidence of this can be seen from the number of visitor arrivals to Thailand in the
second quarter of 2014, THB 5.25 million, a decrease of 13.35 percent year-on-year. The
hotel’s occupancy rate in this quater is 47.37 percent, a decrease of 21.43 percent year-onyear. The Central region including Bangkok was the hardest hit with adecrease of 29.08 percent
year-on-year, followed by the South, with a decrease of 10.91 percent.
The decreasing occupancy rate has affected average room rates, which are limited
because of price strategy and intense competition in the market and indirect competitors such
as serviced apartments and condominiums.
The average actual room rate in the second quarter of 2014 for Thailand is Baht 1,736 per
night, an increase of 0.12 percent year-on-year. The South had highest actual room rate and
increase in rate, the actual room rate was THB 2,138 per night, representing an increase of
5.58 percent year-on-year. Central including Bangkok recorded the second highest actual room
rate at Baht 1,758 per night, a decrease of 3.24 percent compared to the previous year. The
average room rates in the North and North-East of Thailand were THB 1,269 and THB 897 per
night, representing year-on year increases of 3.95 percent and 2.04 percent, respectively.
The tourism trend in the second half of year 2014 and 2015 will be improved resulted from
the unfolding of political problem and the stable of government that enhance tourist confidence
and government's tourist promotion policy. The Tourism Authority of Thailand (TAT) set the
revenue target of THB 2.2 trillion.
1
Source: Bank of Thailand as of October 13, 2014
Attachment 1 Page 14
Attachment 2
Financial Status and Operating Results of
BTS Assets Company Limited
1.
General Information
Name
: BTS Assets Company Limited (“BTSA”)
Type of Business
: Real Estate Development composed of
1)
2)
3)
Real estate development for sale
Real estate development for rent
Hotel and service
Phone Number
: 0-2273-8511-5
Fax Number
: 0-2273-8516
Address
: 21 Soi Choeypuang, Viphavadeerangsit Road, Jompol, Chatuchak,
Bangkok 10900
Registered Capital
: THB 800,000,000 (As of 24 November 2014)
Divided into 8,000,000 ordinary shares with a par value of THB 100 per
share
Paid-up Capital
: THB 800,000,000 (As of 24 November 2014)
Divided into 8,000,000 ordinary shares with a par value of THB 100 per
share
2.
Nature of Business
2.1
Background
BTS Assets Company Limited (“BTSA”) was founded on June 12, 1986, formerly held by
Bangkok Mass Transit System Public Company Limited (“BTSC”). But on February 15, 2011
there was a restructuring of group’s shareholders in property business. BTS Group holdings
public company limited (“BTSG”) had acquired all BTSA’s shares and become the major
shareholder of BTSA.
BTSA’s main business is hotel and property development. The hotel under operation is
the Eastin Grand Sathorn which is a 4-star hotel with 390 rooms located on Sathorn road in the
CBD district near the Surasak BTS skytrain station. The Hotel is a 33 storey structure occupying
2-1-57 Rai or 957 square wah. The hotel commenced its commercial operation since May 2014
and the occupancy for the year starting from April 2013 – March 2014 was approximately
80.13% and for the period of 5 months starting from April 2014 – August 2014 was
approximately 70.81%. Eastin Grand Sathorn has been operated by Absolute hotel service Co.,
Ltd which is is a joint venture company between BTSG and partners with experience in the
hotel business
Additionally, BTSA has 63 vacant landplots located on Phaholyothin Road, Chatuchak,
Bangkok totaling 11 – 0 – 44.8 Rai or 4,444.8 sq.Wah that can be used for development. BSTA
will transfer a 5-0-15.70-rai plot of land located on Phahonyothin, near BTS Mo Chit Station, to
an entity jointly controlled by BTSG and other companies before the closing date. In addition,
BTSA will make a cash provision for corporate income tax related to the sale of the land.
Attachment 2 Page 1
Details of asset are as follow:
Type of Assets
Details
1. Land with 33-fl.
Hotel Building
-
Title deed No.2709 Parcel No. Parcel No. 56 Dealing File No. 403
Located at Sathorn, Bangrak, Bangkok
Area of land 2-1-57 Rai or 957 Square Wah
Date on Land Sale Agreement 15 July 1987
Operate for “Eastin Grand Hotel Sathorn Bangkok”
2. Land
-
63 Land Parcels, Area of land 11-0-44.8 Rai or 4,444.8 Square Wah
Located at Latyao (North Bang Sue), Bang Khen (Bang Sue), Bangkok
Title deed No. 4858, 14375, 14377, 14378, 88720, 88721, 88814, 88839, 88855, 88856,
88857, 88858, 88859, 88860, 88861, 88862, 88863, 88864, 88865, 88894, 88895, 88896,
88897, 88898, 126232, 126235, 126237, 12872, 134273, 140008, 140009, 141625,
141626, 141627, 88900, 88901, 88902, 88914, 88916, 88917, 88918, 88919, 88920,
88921, 88922, 88923, 88924, 88929, 88930, 88932, 88962, 88963, 88964, 88965,
126572, 129742, 129743, 129744, 129745, 129746, 129747, 12948, 12949
2.2
Revenue Structure
BTSA main revenue comprised of revenue from hotel operations. The revenue structures of BTSA in 2012 –
nd
2014 and 2 quarter of 2015 are as follows.
2011/12*
THB
Interest income
Others
Quarter 2/2015
THB
%
THB
%
THB
%
0.00
382,191,859
89.24
588,283,120
85.79
213,929,527
83.54
5.11
36,600,000
8.55
72,573,012
10.58
35,286,820
13.78
0.00
-
0.00
-
0.00
-
0.00
150,000,000
93.69
-
0.00
-
0.00
-
0.00
1,004,576
0.63
332,152
0.08
274,803
0.04
114,125
0.04
910,335
0.57
9,168,414
2.14
24,582,185
3.58
6,752,519
2.64
8,180,000
Other revenue
Gain on transfer of
investments in
subsidiaries to debt
settlement
2013/14
%
Revenue from Hotel
business
Income from services
2012/13
Source: Financial Statement of BTS Assets Company Limited
Remark: In 2012 BTSA changed the accounting period from 1 January – 31 December to 1 April – 31 March
3.
List of Shareholders
List of shareholders as of 24 November 2014
No.
1.
Name of Shareholders
BTS Group Holdings Public Company Limited
Number of Shares
(Shares)
% Shareholding
7,999,998
100.00
0.00
2.
Mr. Keeree Kanjanapas
1
3.
Mr. Surapong Laoha-unya
1
0.00
8,000,000
100.00
Total
Source: Form Bor Or Jor 5 of BTSA
Attachment 2 Page 2
4.
List of Directors
List of BTSA’s Board of Directors as of November 24, 2014 are as follows.
No.
1.
2.
3.
4.
5.
6.
7.
Name of Directors
Mr. Tong Yuk Lun Paul
Mr. Kawin Kanjanapas
Mr. Chi Kueng Kong
Mr. Rangsin Kritalug
Mr. Kom Phanomreungsak
Mr. Chaisit Phurapiromkwan
Mr. Low Yun Sam
Position
Director
Director
Director
Director
Director
Director
Director
Source: Company affidavit of BTSA
5.
Summary of Financial Highlights and Analysis of Operational Performance
and Financial Status of BTSA
Statement of Financial Position
(Unit: THB Million)
Statement of Financial Position
Assets
Current Asset
Cash and Cash Equivalent
Accounts receivable and other receivable
Inventories
Refundable value added tax
Other current assets
Total current assets
Non-current Asset
Pledged bank deposit
Investment properties
Property, plant and equipment
Land held for development
Intangible assets
Advances to contractor
Advances for asset acquisitions
Other non-current assets
Total non-current assets
Total assets
Liabilities and shareholders' equity
Current Liabilities
Account Payable and other payable
Short-term loans from a financial instituition
Current portion of long-term loans
Other current liabilities
Total Current Liabilities
Non-current Liabilities
Long Term Loan from Parent
As of 31 March
As of 30
September
2012
2013
2014
17.13
5.74
9.91
92.47
18.41
143.66
22.86
18.79
14.42
103.44
8.45
167.97
33.35
72.55
11.19
68.35
13.46
198.90
27.37
76.69
9.82
55.01
9.71
178.60
725.69
2,204.33
370.22
43.96
5.74
2.89
3,342.82
1,116.24
2,468.79
4.60
8.05
13.36
3,611.04
1,267.55
2,389.79
2.68
6.26
3,666.28
1,254.20
2,353.96
2.26
4.86
3,615.28
3,486.48
3,779.01
3,865.18
3,793.87
255.41
200.00
1.40
456.81
177.76
1,000.00
8.08
1,185.83
297.84
6.79
304.63
333.45
4.46
337.91
765.20
2,120.50
3,299.50
3,254.50
Attachment 2 Page 3
2014
Statement of Financial Position
As of 31 March
As of 30
September
2012
2013
2014
2014
Long Term Loan from bank
Performance guarantee payable
Provision for employee long-term benefit
Other non-current liabilities
Total Non-current Liabilities
1,609.32
91.02
14.35
0.60
2,480.49
107.75
22.31
0.70
2,251.26
7.92
28.53
0.11
3,336.07
6.83
28.55
1.71
3,291.60
Total Liabilities
2,937.30
3,437.09
3,640.70
3,629.52
Shareholder's equity
Share capital
Registered capital
8,000,000 ordinary shares of Baht 100 each
Issued and Fully Paid-up Share capital
8,000,000 ordinary shares of Baht 100 each
Retained earnings (deficit)
Total shareholders'equity
800.00
800.00
800.00
800.00
800.00
(250.82)
549.18
800.00
(458.09)
341.91
800.00
(575.51)
224.49
800.00
(635.64)
164.36
Total Liabilities and shareholders' equity
3,486.48
3,779.01
3,865.18
3,793.87
Source: Financial Statement of BTS Assets Company Limited
Remark: In 2012 BTSA changed the accounting period from 1 January – 31 Decomber to 1 April – 31 March
BTSG will increase capital in BTSA to pay in full all long-term debts borrowed from the parent company. As a result, on the
closing date, BTSA will have assets, and liabilities in the form of accounts payable, deferred expenses, provision for
employee long-term benefit, and performance guarantee payable, which are all liabilities from normal business operation.
Statement of Comprehensive Income
(Unit: THB Million)
Statement of Comprehensive Income
As of 31 March
2012
6 Months
period As of
30 September
2013
2014
8.18
382.19
36.60
588.28
72.57
213.93
35.29
150.00
-
-
-
1.00
0.91
0.33
9.17
0.27
24.58
0.11
6.75
Total Revenues
160.09
428.29
685.71
256.08
Expenses
Cost from hotel operations
Selling expenses
Servicing and administrative expenses
Total expenses
Profit (loss) before finance cost
Finance cost
64.19
64.19
95.91
(18.17)
202.24
21.09
298.91
522.24
(93.95)
(113.32)
278.95
24.02
371.01
673.98
11.74
(129.16)
104.79
8.99
159.89
273.66
(17.58)
(42.55)
77.74
(207.27)
(117.43)
(60.13)
Revenue
Revenue from hotel operations
Service income
Other income
Gain on transfer of investments in subsidiaries to debt
settlement
Interest income
Others
Net profit (loss) for the year
Source: Financial Statement of BTS Assets Company Limited
Remark: In 2012 BTSA changed the accounting period from 1 January – 31 Decomber to 1 April – 31 March
Attachment 2 Page 4
2014
Summary of Key Financial Ratios
As of 31 March
Financial Ratios
2012
Current Ratio
Gross Profit Margin
2013
As of 30
September
2014
2014
(Times)
0.31
0.14
0.65
0.53
(%)
59.91
(21.94)
1.71
(6.86)
Net Profit Margin
(%)
48.56
(48.39)
(17.12)
(23.48)
Return on Equity (ROE)
(%)
14.16
(60.62)
(52.31)
(36.58)
Return on Assets (ROA)
(%)
2.23
(5.48)
(3.04)
(1.58)
(Times)
5.35
10.05
16.22
22.08
Debt to Equity Ratio (D/E Ratio)
Source: Financial Statement of BTS Assets Company Limited and calculated by Independent Financial Advisers
Analysis of financial status and operating performance
Overall Preformance
Total Revenue
BTSA main revenue comprised of revenue from hotel operations and revenue from
service. In addition, other incomes, such as interest revenue, were in proportion of 3-4% of total
revenue approximately.
In 2012/2013, BTSA earned total revenue of THB 428.29 million which can not compare
with the previous year because BTSA changed accounting period from 1 January – 31
Decomber to 1 April – 31 March in 2012, as following details.
-
Revenue from hotel operations of Baht 382.19 million.
Revenue from service of Baht 36.60 million.
Other revenue of Baht 9.50 million.
In 2013/2014, BTSA earned total revenue of THB 685.41 million increased by THB 257.42
million or 6.10% compared with the previous year as following details.
-
Revenue from hotel operations of THB 588.28 million, increased by THB 206.09 million
or 53.92% compared with the previous year.
Revenue from service operations of THB 72.57 million, increased by THB 35.97 million
or 98.29% compared with the previous year.
Other revenue of THB 24.86 million, increased by THB 15.36 million or 161.64%
compared with the previous year.
For the first six month of 2014/15, BTSA earned total revenue of THB 256.08 million,
comprised of revenue from hotel operations of THB 213.93 million, revenue from service of
THB 35.29 million and other revenue of THB 6.87 million.
Operating Expenses
BTSA operating expenses comprised of hotel direct expense, selling expense and general
and admin expense.
In 2012/13, operating expenses of BTSA were THB 522.24 million which can not compare
with the previous year because BTAS changed accounting period from 1 January – 31
Decomber to 1 April – 31 March in 2012, as following details.
-
Hotel direct expense of THB 202.24 million.
Selling expense of THB 21.09 million.
General and admin expense of THB 298.91 million.
Attachment 2 Page 5
In 2013/14, operating expenses of BTSA were THB 673.98 million, increased by THB
151.73 million, or 29.05% from 2012/2013 as following details.
-
Hotel direct expense of THB 278.95 million, increased by THB 76.71 million, or 37.93%
compared with the previous year.
Selling expense of THB 24.02 million, increased by THB 2.93 million, or 13.87%
compared with the previous year.
General and admin expense of THB 371.01 million, increased by THB 72.10 million, or
24.12% compared with the previous year.
For the first six month of 2014/15, operating expenses of BTSA were THB 273.66 million,
comprised of hotel direct expense of THB 104.79 million, selling expense of THB 8.99 million
and general and admin expense of THB 159.89 million.
Net Profit (Loss)
In 2012/13, BTSA net loss was THB 207.27 million, which can not compare with the
previous year because BTSA changed accounting period from 1 January – 31 Decomber to
1 April – 31 March in 2012.
In 2013/14, BTSA net loss was THB 117.43 million, decreased for THB 89.84 million from
previous year as a result of the increasing of operating performance. The loss before financial
costs was THB 11.74 million.
For the first six month of 2014/15, BTSA net loss was THB 60.13 million, which was loss
before financial costs THB17.58 million.
Financial Status
Assets
Major assets of BTSA are non-current assets which consist of property, plant and
equipment and investment properties.
At the end of 2012/13 BTSA had total assets of THB 3,779.01 million, increased by THB
292.53 million or 8.39% from 2012 which had total assets of THB 3,486.48 million. Major assets
were non-current assets totaling THB 3,611.04 million, and comprised of property, plant and
equipment of THB 2,468.79 million and investment properties of THB 1,116.27 million. While
current assets stood at THB 167.97 million.
At the end of 2013/14 BTSA had total assets of THB 3,865.18 million, increased by THB
86.18 million or 2.28% from 2013. Major assets were non-current assets totaling THB 3,666.28
million, and comprised of property, plant and equipment of THB 2,389.79 million and investment
properties of THB 1,267.55 million. While current assets stood at THB 198.90 million.
For the first six month of 2014/15, BTSA had total assets of THB 3,793.87 million,
decreased by THB 71.31 million or 1.84 from 2014. Major assets were non-current assets
totaling THB 3,615.28 million, and comprised of property, plant and equipment of THB 2,353.96
million and investment properties of THB 1,254.20 million. While current assets stood at THB
178.60 million.
Liabilities
At the end of 2012/13, BTSA had total liabilities of THB 3,437.09 million, increased of
THB 499.79 million or 17.02% from at the end of 2012, which had total liabilities of THB
2,937.30 million. The increase of total liabilities in 2013 was mainly from the increase of long
term loan from parent. Major Liabilities in 2013 were non-current liabilities totaling THB 2,251.26
million, comprised of long term loan from parent of THB 2,120.50 million and performance
guarantee payable of THB 107.75 million and provision for employee long-term benefit of THB
22.31million.While current assets stood at THB 1,185.83 million, increased from current portion
of long-term loans of THB 1,000 million.
Attachment 2 Page 6
At the end of 2013/14, BTSA had total liabilities of THB 3,640.70 million, increased of
THB 203.60 million or 5.92% from at the end of 2013. The change mainly resulted from a
decrease in current liabilities from current portion of long-term loans of THB 1,000 million and
an increase in non-current liabilities from long term loan from parent of THB 1,179 milion. Major
liabilities in 2014 were non-current liabilities totaling THB 3,336.07 million, comprised of long
term loan from parent of THB 3,299.50 million and provision for employee long-term benefit of
THB 28.53 million.While current assets stood at THB 304.63 million, consisted of account
payable and other payable of THB 297.84 million and other current liabilities of THB 6.79
million.
For the first six month of 2014/15, BTSA had total liabilities of THB 3,629.52 million,
decreased of THB 11.18 million or 0.31% from at the end of 2014. Major liabilities were noncurrent liabilities totaling THB 3,291.60 million, comprised of long term loan from parent of THB
3,254.50 million and provision for employee long-term benefit of THB 28.55 million.While
current assets stood at THB 337.91 million, consisted of account payable and other payable of
THB 333.45 million and other current liabilities of THB 4.46 million.
Shareholders’ Equity
At the end of 2013, BTSA had total shareholders’ equity of THB 341.91 million,
decreased of THB 202.27 million or 37.74% from at the end of 2012 which had total
shareholders’ equity of THB 549.18 million, resulted from the entire net loss in 2013.
At the end of 2014, BTSA had total shareholders’ equity of THB 224.49 million,
decreased of THB 117.43 million or 34.34% from at the end of 2013, resulted from the entire
net loss in 2014.
For the first six month of 2014/15, BTSA had total shareholders’ equity of THB 164.36
million, decreased of THB 6.12 million or 26.78% from at the end of 2014, resulted from the
entire net loss in 2014.
6.
Industry Outlook of Hotel Business
The overall hotel market in Thailand in the first half of 2014 was still flat. Tourist
confidence has been negatively affected by the continuing political turmoil that arose at the end
of 20131, evidence of this can be seen from the number of visitor arrivals to Thailand in the
second quarter of 2014, THB 5.25 million, a decrease of 13.35 percent year-on-year. The
hotel’s occupancy rate in this quater is 47.37 percent, a decrease of 21.43 percent year-onyear. The Central region including Bangkok was the hardest hit with adecrease of 29.08 percent
year-on-year, followed by the South, with a decrease of 10.91 percent.
The decreasing occupancy rate has affected average room rates, which are limited
because of price strategy and intense competition in the market and indirect competitors such
as serviced apartments and condominiums.
The average actual room rate in the second quarter of 2014 for Thailand is THB 1,736 per
night, an increase of 0.12 percent year-on-year. The South had highest actual room rate and
increase in rate, the actual room rate was Baht 2,138 per night, representing an increase of
5.58 percent year-on-year. Central including Bangkok recorded the second highest actual room
rate at Baht 1,758 per night, a decrease of 3.24 percent compared to the previous year. The
average room rates in the North and North-East of Thailand were THB 1,269 and THB 897 per
night, representing year-on year increases of 3.95 percent and 2.04 percent, respectively.
The tourism trend in the second half of year 2014 and 2015 will be improved resulted from
the unfolding of political problem and the stable of government that enhance tourist confidence
and government's tourist promotion policy. The Tourism Authority of Thailand (TAT) set the
revenue target of THB 2.2 trillion.
1
Source: Bank of Thailand as of October 13, 2014
Attachment 2 Page 7
Attachment 3
Financial Status and Operating Results of
Kamkoong Company Limited
1. General Information
Name
:
Kamkoong Company Limited (“KKP”)
Type of Business
:
Real Estate Development
(At the present, the Company has not engaged in any
development but has 9 plots of land)
Address
:
Registered Capital
:
21 Soi Choeypuang, Viphavadeerangsit Road, Jompol,
Chatuchak, Bangkok 10900
THB 375,000,000 (As of 24 November 2014)
Divided into 3,750,000 ordinary shares with a par value of THB
100 per share
Paid-up Capital
:
THB 375,000,000 (As of 24 November 2014)
Divided into 3,750,000 ordinary shares with a par value of THB
100 per share
2. Nature of Business
Kamkoong was established for the purpose of property development. However, as of
present, the ompany has not engaged in any development but has 9 plots of land, located on
Phayathai road, Phayathai, Ratchthewi, Bangkok totaling 5-0-0.42 Rai or 2,000.42 sq.Wah
(including plots of land pending transfer, totaling 18 plots with a combined area of 6-2-31.40
Rai, or 2,631.40 sq. wah.), that can be used for development.
The Company and BTSG will determine the Final Selling Price of Kamkoong shares in
accordance with the area of lands on Phayathai Road, near BTS Phayathai Station, owned by
Kamkoong, before the closing date.
Type of Assets
Details
Land
1) Lands on Phayathai Road 8 plots with total area of 4-1-62.4 rai (or 1,762.4 sq. wah)
(“Group 1 Land”)
2) Lands on Phayathai Road that are in the processing of acquiring by KKP with a nonrelated third parties. Theses plots are situated adjacent next to Group 1 Land. The
total area of these 10 plots is 2-0-69 rai (or 869 sq. wah) (“Group 2 Land”) And KKP,
so far already owned one of the plots of the area 0-2-38 rai (or 238 sq. wah). The
expected completion of acquisition will be prior to the Closing Date
3. List of Shareholders
List of shareholders as of 24 November 2014
No.
1.
Name of Shareholders
Number of Shares
(Shares)
BTS Group Holdings Public Company Limited
% Shareholding
3,749,997
100.00
2.
Mr. Keeree Kanjanapas
1
0.00
3.
Mr. Surapong Laoha-unya
1
0.00
4.
Mr. Natasak Chaichana
1
0.00
Total
3,750,000
Source: Form Bor Or Jor 5 of KKP
Attachment 3 Page 1
100.00
4. List of Directors
List of KKP’s Board of Directors as of October 3, 2014 are as follows.
No.
Name of Directors
Position
1.
Mr. Keeree Kanjanapas
2.
Mr. Surapong Laoha-unya
Director
Director
3.
Mr. Anat Arbhabhirama
Director
4.
Mr. Kavin Kanjanapas
Director
5.
Mr. Rangsin Kritalug
Director
6.
Mr. Kom Phanomreungsak
Director
Source: Company affidavit of BTSA
5. Summary of Financial Highlights and Analysis of Operational Performance and
Financial Status of KKP
Statement of Financial Position
(Unit: THB)
Statement of Financial Positon
As of 31 March
2012
2013
As of 30
September
2014
2014
Assets
Current Asset
Cash and Cash Equivalent
Other receivable
Refundable value added tax
Other current assets
Total current assets
Non-current Asset
Deposit for purchase of Land
Land held for development
Investment properties
Total non-current assets
727,747
300,300
770,477
4,258
1,802,782
15,812
770,179
12
786,003
213,778
770,179
42,613
1,026,570
230,518
770,179
14,271
1,014,968
510,387,215
510,387,215
510,387,215
510,387,215
510,387,215
510,387,215
20,000,000
510,387,215
530,387,215
Total assets
512,189,997
511,173,218
511,413,785
531,402,183
Liabilities and shareholders' equity
Current Liabilities
Other Payable
Other current liabilities
Total Current Liabilities
Non-current Liabilities
Long Term Loan from Parent
Total Non-current Liabilities
918,545
456,978
1,375,523
6,533,839
600
6,534,439
12,452,191
900
12,453,091
14,516,507
900
14,517,407
148,767,811
148,767,811
149,150,000
149,150,000
158,270,000
158,270,000
178,520,000
178,520,000
Total Liabilities
150,143,334
155,684,439
170,723,091
193,037,407
Shareholder's equity
Share capital
Registered capital
3,750,000 ordinary shares of Baht 100 each
Issued and Fully Paid-up Share capital
3,750,000 ordinary shares of Baht 100 each
Retained earnings (Deficit)
Total shareholders'equity
375,000,000
375,000,000
375,000,000
375,000,000
375,000,000
(12,953,337)
362,046,663
375,000,000
(19,511,221)
355,488,779
375,000,000
(34,309,306)
340,690,694
375,000,000
(36,635,224)
338,364,776
Total liabilities and shareholders' equity
512,189,997
511,173,218
511,413,785
531,402,183
Attachment 3 Page 2
Source:
Financial Statement of Kamkoong Property Company Limited
Remark:
KKP will increase capital in Kamkoong to pay in full all long-term debts borrowed from the parent company. As a result,
on the closing date, Kamkoong will have assets, and liabilities in the form of accounts payable, deferred expenses,
provision for employee long-term benefit, and performance guarantee payable, which are all liabilities from normal
business operation, and borrowing for land deposit.
Statemenet of Comprehensive Income
(Unit: THB)
Statement of Comprehensive Income
As of 31 March
2012
As of 30
September*
2013
2014
2014
Revenue
Interest earnings
Total Revenues
Expenses
General and Admin Expense
Total Expenses
Profit (Loss) before Financial Costs
Financial Costs
5,229
5,229
1,234
1,234
271
271
471
471
2,012,293
2,012,293
(2,007,064)
(7,343,079)
687,601
687,601
(686,367)
(5,871,517)
8,874,654
8,874,654
(8,874,383)
(5,923,702)
215,673
215,673
(215,202)
(2,110,716)
Net Profit (Loss)
(9,350,143)
(6,557,884)
(14,798,085)
(2,325,918)
Source:
Financial Statement of KKP
Remark: Accounting Period of KKP is 1 April – 31 March
*Data from internal financial statement of KKP, which has been reviewed by the auditor of KKP but not issued. And KKP
did not prepared statement of cash flow
Summary of Key Financial Ratio
As of 31 March
Financial Ratio
2012
Current ratio
Gross profit margin
(time)
2013
As of 30
September
2014
2014
1.31
0.12
0.08
0.07
-
-
-
-
(%)
Net profit margin
(%)
-
-
-
-
Return on equity (ROE)
(%)
(2.58)
(1.84)
(4.34)
(0.69)
(%)
(1.83)
(1.28)
(2.89)
(0.44)
0.41
0.44
0.50
0.57
Return on assets (ROA)
Debt to equity ratio (D/E Ratio)
(time)
Source: Financial Statement of KamkoongProperty Company Limited and calculated by Independent Financial Advisers
Remark: Accounting Period of KKP is 1 April – 31 March
Analysis of financial status and operating performance
Overall Preformance
KKP has not yet operated or launched any projects; there were only assets and
liabilities.
Revenue
Due to KKP has not yet operated or launched any project, there were no revenues from
operations. The only source of income was from interest revenue.
In 2012/13 KKP had total revenues of THB 1,234 decreased by THB 3,995 or 76.40%
compared with that of 2011/2012. In 2013/14 KKP had total revenues of THB 271 decreased by
THB 963 or 78.04% compared with that of 2012/13. For the six month of 2014/15, KKP had
total revenue of THB 471.
Attachment 3 Page 3
Operating Expense
As same as revenues, since KKP has not yet operated, the expenses of KKP were
general and admin expense.
In 2012/13 KKP had general and admin expense of THB 687,601 decreased by THB
1,324,692 or 65.83% compared with that of 2011/12. In 2013/2014 KKP had general and admin
expense of THB 8,874,654 increased by THB 8,187,053 or 1,190.67% compared with that of
2012/13. For the first six month of 2014/15, KKP had general and admin expense of THB
215,673.
Net Profit (loss)
Due to KKP has not yet operated, there was no revenues from operation. However, KKP
reported a consecutive net loss over the past years.
In 2012/13 KKP had net losses of THB 6,557,884 decreased by 42.58% compared with
that of 2011/12. In 2013/2014 KKP had net losses of THB 14,798,085 increased by 125.65%
compared with that of 2012/2013. For the first six month of 2014/15 KKP had net losses of THB
2,325,918
Financial Status
Assets
Major assets of KKP consist of non-current assets which is investment properties.
At the end of 2012/13, KKP had total assets of THB 511.17 million, decreased of THB
1.02 million or 0.20% from at the end of 2012 which had total assets of THB 512.19 million.
Major assets of KKP were non-current assets, comprised of investment properties of THB
510.39 million.While current assets stood at THB 0.78 million.
At the end of 2013/14, KKP had total assets of THB 511.41 million, increased of THB 0.24
million or 0.05% from at the end of 2013. Major assets of KKP were non-current assets,
comprised of investment properties of THB 510.39 million. While current assets stood at THB
1.03 million.
For the first six month of 2014/15, KKP had total assets of THB 531.40 million, increased
of THB 19.99 million or 3.91% from at the end of 2014. Major assets of KKP were non-current
assets, comprised of investment properties of THB 510.39 million and advance for purchases of
land of THB 20 million. While current assets stood at THB 1.01 million
Liabilities
At the end of 2012/13, KKP had total liabilities of THB 155.68 million, increased of THB
5.54 million or 3.69% from at the end of 2012, which had total liabilities of THB 150.14 million.
The increase of total liabilities in 2012/13 was due to an increase in other payable of THB 5.62
million. Major assets of KKP were non-current liabilities, comprised of long term loan from
parent of THB149.15 million. While current asset stood at THB 6.53 million.
At the end of 2013/14, KKP had total liabilities of THB 170.72 million, increased of THB
15.04 million or 9.66% from at the end of 2013. The increase of total liabilities in 2013/14 was
due to an increase in other payable and long term loan from parent in the amount of THB 5.92
million and THB 9.12 million, respectively. Major assets of KKP were non-current liabilities,
comprised of long term loan from parent of THB 158.28 million. While current asset stood at
THB 12.45 million.
For the first six month of 2014/15, KKP had total liabilities of THB 193.04 million,
increased of THB 22.31 million or 13.07% from at the end of 2014. The increase of total
liabilities in second of 2014/15 was due to an increase in long term loan from parent THB 20.25
million. Major assets of KKP were non-current liabilities, comprised of long term loan from
parent of THB 178.52 million. While current asset stood at THB 14.52 million.
Attachment 3 Page 4
Shareholders’ equity
At the end of 2012/2013, KKP had total shareholders’ equity of THB 355.49 million,
decreased of THB 6.56 million or 1.81% from at the end of 2012 which had total shareholders’
equity of THB 362.05 million, resulted from the entire net loss in 2013.
At the end of 2013/2014, KKP had total shareholders’ equity of THB 340.69 million,
decreased of THB 14.80 million or 4.16% from at the end of 2013, resulted from the entire net
loss in 2014.
For the first six month of 2015, KKP had total shareholders’ equity of THB 338.36
million, decreased of THB 2.33 million or 0.68% from at the end of 2014, resulted from the
entire net loss in second quarter of 2015.
6. Industry Outlook in Property Business
During 2nd Half of 2014, it is expected that real estate business will improve as the political
turmoil eases. In addition, the new government’s stimulus measures aimed at shoring up the
economy should help support the real estate market that has been plagued by negative factors
since early 2014. However, there are other risks that may hurt home buying decisions, including
an unstable recovery in the Thai economy, rising cost of living and hefty household debt.
Kasikorn Research Center have conducted a survey on Thai consumer behavior toward
home purchases in Greater Bangkok – that accounts for the largest share of the country’s real
estate investments – and in other key cities, i.e., Songkhla, Nakhon Ratchasima, Khon Kaen,
Chiang Mai and Chonburi, given the extraordinary growth seen in real estate investment there
over recent years. The survey was conducted both before and after the NCPO took control of
Thailand’s administration and the results are summarized, as follows:
•
Consumer sentiment has improved, post-takeover, with a majority of the respondents
having less concern about domestic politics, the economy and incomes compared to the
period before the takeover.
•
Prospective home buyers are more enthusiastic, with 62.8 percent of the respondents
saying that before the takeover they were uncertain when they should buy, but similar
responses fell to 55.6 percent, post-takeover. More were specifying a definite timing to
buy during 2H14, or intending to buy within 1-3 years. This signals that the real estate
market should gradually recover as the economy stabilizes along with other positive
factors.
•
The survey also shows that 84.3 percent intend to live in the homes they purchase,
while 9.3 percent intend to buy as an investment and only 6.4 percent intend to buy
homes for business purposes or as a second or vacation home.
Delayed purchases seen in some consumer segments have forced developers to
introduce promotions to induce sales. According to the poll, 57.3 percent of the respondents felt
that these strategies were swaying them, while 42.7 percent thought otherwise, saying that
housing project quality, developer reputation and materials used are more important.
Source: Kasikorn Research Center as of September 11, 2014
Attachment 3 Page 5
Attachment 4
Company Information and Operating Results of
BTS Group Holding Public Company Limited
1.
General Information
Name
Type of Business
Website
Address
:
:
:
:
Telephone
Fax
Registered Capital
:
:
:
Paid-up Capital
:
2.
BTS Group Holdings Public Company Limited
Mass Transit Business
http://www.btsgroup.co.th/
21 Soi Choeypuang, Viphavadeerangsit Road, Jompol,
Chatuchak, Bangkok 10900
02-273-8611-5
02-273-8610
THB 63,652,544,720
Divided into 15,913,136,180 ordinary shares with a par value
of Baht 4.00 per share
THB 47,677,000,644
Divided into 11,919,250,161 ordinary shares with a par value
of Baht 4.00per share
Nature of Business
2.1 Background
BTS Group Holdings Public Company Limited (formerly known as Tanayong Public
Company Limited) was established on 27 March 1968 to operate the property development
business. The Company was listed on the Stock Exchange of Thailand and commenced the
first day trading of its shares on 1 March 1991 by using “TYONG” as a tricker. The Company
was converted to a public limited company on 2 June 1993. Since then, the Company has
expanded its scope into various types of business, such as property development projects,
condominiums in the center of the city, serviced apartments, office buildings, hotels and
infrastructure projects. In 1992, Tanayong established a wholly-owned subsidiary, Bangkok
Transit System Corporation Ltd. (BTSC), to sign the concession contract with the Bangkok
Metropolitan Administration (BMA) to design, build and operate Bangkok’s first mass transit
system and Commercial operation of the BTS SkyTrain commenced on December 5st, 1999
The Company continues to expand its business. On 4 May 2010, the Company acquired
94.60 % of total issued shares of BTSC and changed the Company’s name to BTS Group
Holdings Public Company Limited. As a result, the Company’s main business has changed
to the mass transit business. Therefore, to better reflect the Company’s new main business,
on 11 May 2010, the Company changed the sector to “Transportation and Logistics” under
the “Services” industry and changed its trading symbol to “BTS”.
2.2 Nature of Business
1) Mass Transit Business
BTSC currently is the operator of the SkyTrain System and the BRT. The current 23.5
km network of the BTS SkyTrain System runs across the center of Bangkok, connecting the
Attachment 4 Page 1
business district to major department stores, hotels and other destinations. BTSC also
manages the 2.2 km Silom Line Extension owned by BMA. BTSC also continues to expand
its scope of operation services as the mass transit network continues to expand. On 5
December 2013, BTSC commenced full operation of the 5.3km Silom Line extension from
Wongwian Yai to Bang Wa following the award of this 30-year Operating and Maintenance
Service (O&M) Contract from the Bangkok Metropolitan Administration (BMA) in May 2012.
(Note that trial operation from Wongwian Yai to Talat Phlu was commenced in early 2013.)
Through this expansion programme, the Company aims to be a part of fostering a higher
quality of service to the public.
2) Media Business
Advertising Business conducted by VGI which operates in the service provider
network media by focusing on network media, consistent with the pattern of life in the
modern era (Lifestyle Media) by the current network of VGI media access to the daily lives of
audiences everywhere from traveling by BTS Skytrain, working in an office building and
shopping in modern trade.
3) Property Business
Real Estate Business is the original core business of the company since embarking.
Currently, the Group continues to operate property in part of the mechanism to strengthen
urban communities that are growing and expanding along the sky train route. Moreover, BTS
sky train business will add value to the media business
4) Service Business
Within the Services business, we focus on providing convenience to our customers
through various kinds of services. Rabbit cards can be used as a common ticket across
Mass Transit systems, such as BTS SkyTrain and BRT Bus as well as for payment ofgoods
and services at rabbit’s participating retail stores to earn Carrot Rewards.
We also have ChefMan Restaurant, a premium Chinese restaurant chain committed
to providing excellent food with high quality ingredients cooked by professional. Moreover,
we manage 3 to 4 star hotels under ‘U Hotels & Resorts’ and ‘Eastin Hotels & Residences”
brands across South East Asia. Ouer Vision is to provide a unique range of complete
hospitality services and consultancy on an a la carte basis with tailor-made client-, ownerand developer-centric solutions.
2.3 Corporate Structure
Business Organisation of the Company, Subsidiaries and Associated Companies as
of 31 March 2014
1) Mass transit Business
The core business of the company by BTSC (a subsidiary of the Company holding
97.46 percent)
2) Media Business
By VGI’s Group
3) Property Business
This is the original core business of the company since embarking. Currently, the
Group continues to operate in property business
4) Service Business
Attachment 4 Page 2
The services that supp
T
port the imp
plementation
n of the corre businessses of the Group
G
in
v
various
field
ds, includin
ng electronic money (e
e-money) with
w
a common ticket system
u
under
the na
ame "Rabbiit"
Rema
ark: Annual Rep
port 2013/14 of BTSG
Atta
achment 4 Pag
ge 3
2.4 Revenue structure by product
Revenue structure during 2011/12-2013/14 and the 2st quarter of 2015 were
summarized as follows.
FY 2011/12
Operating Revenue
THB
Million
FY 2012/13
THB
Million
(%)
FY 2013/14
(%)
THB
Million
Q2/2015
(%)
THB
Million
(%)
Mass Transit
5,031.9
65.2
6,015.5
58.0
2,312.5
26.4
609.4
36.2
Media
1,958.8
25.4
2,794.7
26.9
3,121.2
35.6
787.0
42.1
Property
728.3
9.4
1,444.7
13.9
2,934.1
33.5
330.9
17.7
Services
0.0
0.0
120.6
1.2
399.0
4.6
144.2
7.7
7,719.8
100.0
10,375.5
100.0
8,766.8
100.0
1,871.5
100.0
Total
Source: Form 56-1 FY 2012/13 and FY 2013/14 of BTSG and Financial Statement of BTSG as of 30 September, 2014
3.
List of Shareholders
Top 10 major shareholders of BTSG as of June 10, 2014 (the latest book closing
date) are as follows:
No.
Name of Shareholders
1.
Mr.Keeree Kanjanapas Group*
2.
Number of Shares
(Shares)
% Shareholding
4,886,135,039
41.01
Thai NVDR Co., Ltd.
770,667,077
6.47
3.
Bangkok Bank Public Company Limited
545,466,733
4.58
4.
HSBC (Singapore) Nominees Pte Ltd
178,476,063
1.50
5.
State Street Bank Europe Limited
93,279,408
0.78
6.
K Equity 70:30 LTF
88,896,700
0.75
7.
K Equity Dividend LTF
62,131,600
0.52
8.
Chase Nominees Limited 46
60,651,410
0.51
9.
State Street Bank and Trust Company
58,578,083
0.49
10.
Mr. Sombat Panitcheewa
53,592,992
0.45
Other shareholders
Total
Source:
5,121,375,056
42.97
11,919,250,161
100.00
Thailand Securities Depositary Co., Ltd.
Remark: * Mr. Keeree Kanjanapas Group consists of (1) Mr. Keeree Kanjanapas holding 3,881,164,652 shares on his own
name, holding 350,000,000 shares through the custodian, UBS AG HONG KONG BRANCH, and holding
260,000,000 shares through the custodian, CREDIT SUISSE AG, SINGAPORE BRANCH (2) Mr. Kavin Kanjanapas
holding 2,459,295 shares, (3) Ms. Sushan Kanjanapas holding 32,460,000 shares, (4) K2J Holding Co., Ltd. holding
360,000,000 shares, and (5) Amsfield Holdings Pte. Ltd. holding 51,092 shares
Attachment 4 Page 4
4.
Board of Directors
List of BTSG’s Board of Directors as of November 24, 2014 are as follows.
No.
Name of Directors
Position
1
Mr. Keeree Kanjanapas
2
Mr. Paul Tong
Chairman
Director
3
Mr. Anat Arbhabhirama
Director
4
Mr. Surapong Laoha-unya
Director
5
Mr. Kavin Kanjanapas
Director
6
Mr. Rangsin Kritalug
Director
7
Mr. Chi Kueng Kong
Director
8
Lt.Gen. Phisal Thepsithar
Independent Director/ Chairman of Audit Commitee
9
Mr. Amorn Chandarasomboon
Independent Director
10
Mr. Suchin Wanglee
Independent Director/ Audit Committee
11
Mr. Charoen Wattanasin
Independent Director/ Audit Committee
12
Mr. Ying Chew Henry Cheong
Independent Director
Source: www.set.or.th
5.
Summary of Financial Highlights and Analysis of Operational Performance and
Financial Status of BTSG
Statement of Financial Position
(Unit: THB million)
Consolidated
as of 30 March
as of
1 April
2012
Statement of Financial Position
2013
As of 30
September
2014
2014
Assets
Current assets
Cash and cash equivalents
1,333.2
3,513.3
8,668.5
5,955.7
Current investments
Bank account for advances from cardholders
Trade and other receivables
-
993.8
23,496.3
20,505.2
1.1
78.9
152.7
179.8
1,106.7
945.6
1,074.5
1,451.8
Current portion of asset under operating lease
-
-
90.0
91.1
Current portion of asset under finance lease
-
-
26.3
27.1
Consumable spare parts
93.0
29.2
31.0
24.3
Advances to Contractors
13.8
25.6
13.7
18.2
3,349.1
3,510.3
2,549.8
2,462.8
73.0
73.0
68.3
68.9
224.3
224.3
224.3
224.3
1,202.5
247.8
671.7
470.9
128.0
137.6
60.6
96.3
Real estate development costs
Assets awaiting transfer under rehabilitation plan
Investments in subsidiaries awaiting transfer under
rehabilitation plan
Accrued income
Prepaid expenses
Other current assets
342.9
315.9
215.4
229.8
7,867.6
10,095.3
37,343.1
31,806.2
-
42,123.1
-
-
7,867.6
52,218.4
37,343.1
31,806.2
Non-current assets classified as assets held for sale
Total current assets
Attachment 4 Page 5
(Unit: THB million)
Consolidated
as of 30 March
as of
1 April
2012
Statement of Financial Position
2013
As of 30
September
2014
2014
Non-current assets
Restricted deposits
323.8
88.5
611.1
1,185.6
Cash deposited as collateral for debt settlement
232.7
232.7
232.7
232.7
-
-
44.5
38.4
7.0
10.0
13,899.0
14,215.4
148.8
367.5
6,238.2
4,900.3
45,144.2
-
-
-
Investments in a joint venture
Investments in associates
Other long-term investments
Project costs – elevated train system
Project costs – media
-
-
2,340.1
2,321.2
Reusable spare parts
81.2
22.4
21.9
32.6
Spare parts - maintenance contract
292.8
-
-
-
Land and projects awaiting development
2,676.3
-
263.9
263.9
Investment properties
2,461.0
2,867.6
3,101.5
3,080.0
Property, plant and equipment
6,039.2
9,590.8
7,674.0
8,241.7
Leasehold rights
90.0
81.5
77.6
73.5
Intangible assets
26.7
50.2
65.8
66.8
2.1
2.0
2.4
1.8
Retention receivable
Goodwill
Deposits and advances for assets. acquisitions
78.7
78.7
78.7
78.7
496.9
481.7
45.0
45.0
79.6
0.2
0.2
-
-
-
325.0
341.5
741.5
545.1
204.0
204.0
-
-
3,657.6
3,661.6
-
-
60.1
46.4
1,428.4
259.8
37.3
46.0
98.5
393.8
387.4
422.4
60,449.4
15,072.5
39,368.0
39,499.5
68,317.0
67,290.9
76,711.1
71,305.7
1,941.5
1,117.0
-
220.0
1,514.8
1,948.2
2,222.4
2,379.4
Advances to contractors
Accrued income
Rights of claim from acquisition of debts per rehabilitation
plan
Accounts receivable - net of the concession to be received
within one year
Finance lease asset - net of current portion received within
one year
Deferred tax assets
Other non-current assets
Total non-current assets
Total assets
Liabilities and shareholders’ equity
Current liabilities
Bank overdraft and short-term loans from financial
institutions.
Trade and other payables
Advances received from cardholder
1.1
77.7
151.1
179.4
351.9
152.3
73.8
130.3
Short-term loans from related individual and party
-
-
20.0
-
Current portion of creditors per rehabilitation plan
745.4
745.4
745.4
745.4
Current portion of long-term loans
583.4
1,967.2
10.0
22.0
2,495.8
2,078.7
3,607.6
1,466.1
-
80.8
181.9
181.9
160.2
470.4
105.1
101.0
Accrued costs of construction
Current portion of long-term debentures
Liability awaiting final court order
Unearned revenues
Attachment 4 Page 6
(Unit: THB million)
Consolidated
as of 30 March
as of
1 April
2012
Statement of Financial Position
Fare box revenues awaiting transfer
2014
95.1
177.0
181.1
55.8
148.0
988.9
546.5
Short-term provision – related parties
Total current liabilities
2014
137.7
Income tax payable
Other current liabilities
2013
As of 30
September
-
-
45.8
56.4
350.4
141.1
201.3
305.2
8,338.0
9,021.9
8,530.3
6,514.7
-
-
641.8
608.6
Non-current liabilities
Unearned revenues
Creditors per rehabilitation plan – net of current portion
52.1
51.9
49.6
49.6
Long-term loans - net of current portion
2,934.0
396.7
230.0
1,193.5
Long-term debentures - net of current portion
9,443.8
6,401.0
2,807.4
1,343.9
Convertible debentures - liability component
8,648.3
-
-
-
Retention payable
127.5
68.0
40.6
44.0
Provision for long-term employee benefits
400.2
481.7
557.6
585.7
-
-
1,266.9
1,353.3
108.1
360.8
3,037.1
2,964.7
12.7
7.2
7.7
8.3
Long-term provision – related party
Deferred tax liabilities
Other non-current liabilities
Total non-current liabilities
21,726.7
7,767.3
8,638.7
8,151.6
Total liabilities
30,064.7
16,789.2
17,169.0
14,666.3
47,881.8
47,945.8
63,652.5
63,652.5
36,600.5
44,426.5
47,656.9
47,656.9
350.7
1,486.1
1,797.2
1,797.2
-
1,295.6
-
22.0
(3,372.0)
(3,372.0)
(3,372.0)
(3,372.0)
(123.1)
2,811.2
4,448.3
3,873.3
Surplus from the sale of warrants of the company.
-
-
-
347.0
Treasury shares
-
-
-
(925.5)
1,476.0
1,750.5
2,760.3
2,760.3
-
-
-
925.5
(1,705.8)
(3,465.9)
818.1
(1,325.2)
Shareholders’ Equity
Share capital
Registered
15,913,136,180 ordinary shares of THB 4 each
(31 March 2013: 11,986,444,024 ordinary shares, par value
THB 4 each)
(April 1, 2012: 74,815,275,124 ordinary shares of THB 0.64
per share).
Issued and fully paid.
11,914,230,525 ordinary shares of THB 4 each
(31 March 2556: 11,106,634,594 ordinary shares, par
value.THB 4 each)
( 1 April 2012: 57,188,274,676 ordinary shares of THB 0.64
each)
Share premium
Share subscriptions received in advance
Deficit on business combination under common control
Surplus (deficit) from the changes in the ownership interests
in subsidiaries
Retained earnings
Appropriated for legal reserve
Appropriated reserve for treasury shares.
Retained earnings (loss)
Attachment 4 Page 7
(Unit: THB million)
as of
1 April
2012
Statement of Financial Position
Other components of shareholders’ equity.
Equity attributable to owners of the Company
Non-controlling interest of the subsidiaries
Consolidated
as of 30 March
2013
As of 30
September
2014
2014
3,340.7
3,663.5
3,577.1
3,439.1
36,567.0
48,595.5
57,685.9
55,198.6
1,685.3
1,906.2
1,856.2
1,440.8
Total shareholders’ equity
38,252.3
50,501.7
59,542.1
56,639.4
Total liabilities and shareholders’ equity
68,317.0
67,290.9
76,711.1
71,305.7
Source: Form 56-1, Consolidated Financial Statements of BTSG for the period ended September 30, 2014.
Profit and loss
(Unit: THB million)
Consolidated
Statement of comprehensive income
For the six
months ended
September 30
For the fiscal year ended March 31
2012
2013
2014
2014
Continuing operations
Profit or loss:
Revenues
Train operators income
Service income
Revenues from sales of real estate
Revenues from construction services (reversal)
-
-
-
49.8
3,281.2
4,787.6
6,056.4
3,141.4
325.5
787.9
2,057.2
250.5
72.8
9.2
1.6
-
Other income
Management income
-
-
0.1
-
Dividend income
0.4
1.8
6.0
29.1
Interest income
39.7
58.9
1,213.2
619.7
Gain from sale of investments
-
-
-
105.9
Gain from sales of investments in subsidiaries
-
999.7
-
-
Gain on sale of future net fare box revenues
-
-
13,497.6
-
Gain on sales of assets
-
-
379.9
0.3
Others
Total Revenues
1,235.4
63.7
88.6
77.4
4,955.0
6,708.8
23,300.6
4,274.1
Expenses
Cost of train operators.
Cost of services
Cost of sales of real estate
-
-
-
49.8
1,586.1
2,346.8
2,828.1
1,472.2
226.8
527.3
1,260.4
156.4
Cost of construction services
83.4
8.3
0.7
-
Selling and servicing expense
132.1
223.1
342.1
78.6
Administrative expenses
740.1
1,077.9
1,496.7
746.0
2,768.5
4,183.4
5,928.0
2,503.0
2,186.5
2,525.4
17,372.6
1,771.1
-
-
-
(6.1)
(2.3)
3.0
619.2
397.9
Total expenses
Profit before share of income from investments in
associates and joint venture, finance cost and income
tax expenses
Share of income from investments in joint ventures.
Share of income (loss) from investments in associates.
Attachment 4 Page 8
(Unit: THB million)
Consolidated
Statement of comprehensive income
For the six
months ended
September 30
For the fiscal year ended March 31
2012
2013
2,184.2
2,528.4
(1,432.0)
(1,247.8)
(630.7)
(245.6)
752.2
1,280.6
17,361.1
1,917.3
(172.6)
(1,248.1)
(3,806.4)
(403.5)
579.6
32.5
13,554.7
1,513.8
Profit from discontinued operation for the year.
1,656.0
1,894.7
30.3
-
Profit for the year
2,235.6
1,927.2
13,585.0
1,513.8
-
(31.7)
-
-
0.9
11.9
(0.9)
1.5
-
281.4
-
-
-
-
-
(27.7)
4.2
15.0
(94.1)
(119.2)
5.1
276.6
(95.0)
(145.4)
2,240.7
2,203.8
13,490.0
1,368.4
Profit before finance cost and income tax expense.
Financial cost
Profit before income tax expenses
Income tax expenses
Profit from continued operation for the year
2014
2014
17,991.8
2,162.9
Discontinued operation
Other comprehensive income:
Actuarial gains (losses)
Exchange rate differences on translation of financial
statements in foreign currency
Revaluation surplus on assets
Gain on changes in value of available for sale investments sold portion
Gain (loss) on changes in value of available-for-sale
investments
Other comprehensive income for the period
Total comprehensive income for the period
Profit (loss) attributable to:
Equity holders of the Company
Profit (loss) from continued operations.
Profit from discontinued operations.
509.5
(144.8)
12,615.3
1,283.6
1,596.1
1,863.4
29.6
-
2,105.6
1,718.6
12,644.9
1,283.6
70.1
177.4
939.4
230.2
Non-controlling interests of the subsidiaries
Profit from continued operations.
Profit from discontinued operations.
59.9
31.3
0.8
-
130.0
208.7
940.2
230.2
2,235.6
1,927.3
13,585.1
1,513.8
Total comprehensive income attributable to:
Equity holders of the Company
Total comprehensive income from continued operations.
Total comprehensive income from discontinued operations.
514.7
132.5
12,520.2
1,138.2
1,596.1
1,863.4
29.6
-
2,110.8
1,995.9
12,549.8
1,138.2
70.1
176.6
939.4
230.2
59.9
31.3
0.8
-
Non-controlling interests of the subsidiaries
Total comprehensive income from continued operations.
Total comprehensive income from discontinued operations.
130.0
207.9
940.2
230.2
2,240.8
2,203.8
13,490.0
1,368.4
Source: Form 56-1, Consolidated Financial Statements of BTSG for the period ended September 30, 2014.
Attachment 4 Page 9
Cash flow
(Unit: THB million)
Consolidated
Cash Flow Statement
For the fiscal year ended March 31
2012
2013
Net cash provided by (used in) operating activities.
1,755.8
4,659.3
Net cash provided by (used in) investing activities.
(2,319.5)
4,097.7
12,180.3
3,661.0
Net cash provided by (used in) financing activities.
70.6
(6,588.8)
(11,048.4)
(6,188.9)
Increase/(decrease) in foreign currency translation
2014
For the six
months ended
September 30
3,218.5
2014
(186.3)
0.9
11.9
(0.9)
1.4
Net increase in cash and cash equivalents.
(492.2)
2,180.1
4,349.5
(2,712.8)
Cash and cash equivalents at beginning of period.
1,825.4
1,333.2
3,513.3
8,668.5
Cash and cash equivalents at end of period.
1,333.2
3,513.3
7,862.8
5,955.7
Source: Form 56-1, Consolidated Financial Statements of BTSG for the period ended September 30, 2014
Summary of key financial ratios
(Unit: THB million)
Consolidated
For the fiscal year ended
March 31.
Ratios
2012
Current Ratio
2013
2014
For the
fiscal year
ended March
31.
2014
(Times)
0.94
5.79
4.31
4.88
(%)
47.2
48.8
53.1
57.6
Net margin
(%)
24.2
16.6
57.8
35.6
Return on shareholders' equity (ROE)B
(%)
6.1
3.8
22.7
4.5
Gross operating profit margin
A
C
Return on Assets (ROA)
Debt-to-equity Ratio (D / E Ratio).
(%)
3.3
2.9
17.7
3.5
(Times)
0.81
0.33
0.28
0.26
Source: Form 56-1, Consolidated Financial Statements of BTSG for the period ended September 30, 2014.
Note:
BTSG the period 1 April to 31 March.
A
calculation of the accounting profit (Excluding the portion of the non-controlling interest in a subsidiary) / total income tax.
B
calculated from accounting profit. (Excluding the portion of the non-controlling interest in a subsidiary) / Shareholders' equity.
C
calculated from accounting profit. (Excluding the portion of the non-controlling interest in a subsidiary) / total assets.
Analysis of financial status and operating performance
Operating performance
• Overall Performance
Year 2013/14 The Company and its subsidiaries (together, the “Group”) recorded
consolidated total revenue of THB 23,300.5 million in FY 13/14. This represented an
increase of 247.3% (or THB 16,591.6 million) from THB 6,708.9 million in FY 12/13. The
increase was primarily due to both stronger operating performance as well as the gain from
the sale of net fare-box revenue to BTSGIF of THB 13,497.6 million (for more details, please
refer to Note 52 to FY 13/14 financial statements). Despite (1) higher O&M revenue from
additional service income from the Silom line extension, (2) stronger Media, Property and
Services operating performance and (3) an increase in interest income by THB 1,154.2
million to THB 1,213.2 million, mainly earned on the sales proceeds from BTSGIF, operating
revenue1 (which already includes share of net profit in BTSGIF of THB 612.5 million) fell by
15.5% YoY to THB 8,766.8 million as a result of the sale of Net fare-box revenues to
Attachment 4 Page 10
BTSGIF. Revenue from the Mass Transit, Media, Property and Services businesses
accounted for 26.4%, 35.6%, 33.5% and 4.6% of total operating revenue, respectively.
Total consolidated expenses and SG&A reached THB 5,928.0 million in FY 13/14, an
increase of THB 1,744.5 million or 41.7% YoY largely from the higher cost of sales of real
estate and cost of services. Operating costs decreased by 22.7% YoY to THB 4,109.9
million largely from the reduction in costs related to the operation of the core network which
was sold to BTSGIF, which offset the increase in operating costs of Property, Media and
Services businesses (see segmental performance for more details). As a result of cost
efficiency and the one-third investment of the units in BTSGIF, the Group operating gross
profit margin2 improved to 53.1% from 48.8% in the previous year.
Although operational performance in Media, Property and Services businesses
improved, the Group operating EBITDA3 margin declined from 49.0% in the previous year to
39.0% due to the higher proportion contribution of lower margin Mass Transit O&M and
Property businesses. Finance costs fell by 49.5% or THB 617.1 million to THB 630.7 million,
primarily as the Group repaid outstanding debt and all CBs were fully converted.
Due to the improved operational performance, the recognition of share of net profit in
BTSGIF, the increase in interest income as well as a reduction in finance costs, recurring
pre-tax profit4 margin for this year improved to 36.4% from 21.6% in FY 12/13. Although the
Company recorded an increase in consolidated income tax to THB 3,806.4 million, mainly
from (1) tax expenses related to capital gain on BTSGIF transaction of THB 2,700.0 million,
(2) tax expenses associated with BTSC capital reduction of THB 406.7 million, net recurring
profit9 improved 153.5% YoY to THB 2,611.6 million in FY 13/14. Taking into account all the
aforesaid transactions, together with non-recurring items which were mainly gain from sale
of net fare-box revenue, the Group recorded a consolidated profit of THB 13,585.0 million
(increasing 604.9% YoY) and profit attributable to the equity holders of the Company of THB
12,644.9 million (increasing 635.8% YoY).
Remark:
1
Operating revenue from the operational performances from 4 BUs and share of net profit (loss) from BTSGIF,
EXCLUDES interest income, and non-recurring items
2
Operating gross profit margin calculated based on the operational performances from 4 BUs and share of net
profit (loss) from BTSGIF
3
Operating EBITDA calculated based on the operational performances from 4 BUs, share of net profit (loss) from
BTSGIF, EXCLUDES interest income and non-recurring items which are dividend income, gain from sales of net
fare-box revenue to BTSGIF, other non-recurring items
4
Recurring profit calculated based on the operational performances from 4 BUs, share of net profit (loss) from
BTSGIF and AHS, as well as including other recurring items which are interest income and other recurring items
(before MI)
During the first 6 month of 2014/15 the Group recorded consolidated total revenue
of THB 2,106.6 million in 2Q 14/15, falling 27.0% or THB 779.9 million YoY from THB
2,886.5 million in 2Q 13/14. The reduction was primarily due to (1) a decrease in revenue of
sales of real estate of THB 541.1million, (2) a gain on the sales of land of THB 379.8 million
in 2Q 13/14 which was not repeated in 2Q 14/15, yet offset with (3) an increase in service
income of THB 170.5 million mainly from the increased O&M revenue. Despite (1) higher
O&M revenue from additional service income from the Silom line extension (2) additional
scope of work in BRT contract and (3) an increase in share of net profit from BTSGIF units,
operating revenue2 fell by 17.8% YoY to THB 1,871.5 million largely as a result of the
reduction in Property revenue from fewer transferred units of Abstracts Phahonyothin Park
Condominium in 2Q 14/15 and the softened Media revenue. Revenue from the Mass Transit,
Media, Property and Services businesses accounted for 32.6%, 42.1%, 17.7% and 7.7% of
total operating revenue, respectively.
However, operating revenue rose 7.3% QoQ to THB 1,871.5 million as a result of the
improved performance of all business units. Mass Transit revenue rose 11.8% QoQ, which
was mainly attributable to an increase in share of net profit in BTSGIF units and the
additional scope of work in BRT contract. Media revenue rebounded 4.4% QoQ, which was
in line with the slow economic growth momentum. Property revenue also increased 3.6%
Attachment 4 Page 11
from the previous quarter as a result of the improvement in our group of hotels’ business.
Lastly, Services revenue showed 14.6% growth, largely owing to the strong performance of
ChefMan Restaurants.
Total consolidated expenses and SG&A reached THB 1,275.2 million in 2Q 14/15, a
reduction of THB 312.1 million or 19.7% YoY mainly from the decline in cost of sales of real
estate as well as selling and marketing expenses related to sales of Abstracts Condominium
project. Operating costs decreased by 26.8% YoY to THB 793.0 million, which was in line
with the reduction in total operating revenue. Nonetheless, as operating costs decreased at
a higher rate than the decline in operating revenues, the Group operating gross profit
margin5 improved to 57.6% from 52.4% in the previous year.
As a result of the aforementioned changes, the Group operating EBITDA6 was THB
738.7 million, a decrease of THB 102.8million or 12.2% YoY and an increase of THB 49
million or 7.1% QoQ. However, the operating EBITDA margin improved to 39.5% in 2Q
14/15 (versus 37.0% in 2Q 13/14) from growth in O&M margin and lower contribution from
low margin business. Finance costs fell by 35.6% or THB 61.9 million to THB 112.0 million,
primarily as the Group repaid the third tranche of BTSC debentures (THB 3,611.3 million) in
August 2014. The net recurring (post-tax) profit7 margin for this quarter improved to 32.9%
from 28.2% in 2Q 13/14 from the improved operating gross profit, an increase in other
recurring income of THB 48.4 million, a reduction in finance costs as well as a reduction in
income tax expenses of THB 21.7 million. Taking into account all the aforesaid transactions,
the Group recorded a consolidated profit of THB 751.5 million (decreasing 31.0% YoY) and
profit attributable to the equity holders of the Company of THB 633.4 million (decreasing
33.1% YoY).
5
Remarks: Operating gross profit margin calculated based on the operational performances from 4 BUs and share of net profit
(loss) from BTSGIF
6
Operating EBITDA calculated based on the operational performances from 4 BUs, share of net profit (loss) from
BTSGIF, EXCLUDES interest income, dividend income, share of net profit (loss) from other associates (except from
BTSGIF) and joint venture, non-recurring items from sales of net fare-box revenue to BTSGIF and other nonrecurring items
7
Recurring profit calculated based on the operational performances from 4 BUs, share of net profit (loss) from
BTSGIF and other associates and joint venture, as well as including other recurring items which are interest income
and other recurring items (before MI)
• Segmental Performance
MASS TRANSIT
FY2013/14 Total Mass Transit8 revenue dropped 61.6% YoY to THB 2,312.5 million.
As a result of the sale of net fare-box revenue to BTSGIF, fare-box revenue decreased from
THB 4,895.5 million to THB 207.7 million this year, and costs and SG&A related to the Core
Network dropped from THB 2,939.7million to THB 134.7 million (BTSG recorded
transactions related to the Core Network for 16 days before the completion of the BTSGIF
transaction on 17 April 2013). O&M revenue increased YoY by 33.2% or THB 372.3 million
to THB 1,492.3 million. Furthermore, the Company recorded a share of net profit from its
investment in BTSGIF units of THB 612.5 million in FY 13/14.
(In order to enable analysis of underlying performance on a comparable basis to previous years, the following section
analyses fare-box revenues, O&M revenues and their associated costs and SG&A for the full years of FY 13/14 and FY 12/13
irrespective of whether BTSG or BTSGIF had the rights to such revenues.)
Total revenue from the Mass Transit business increased by 19.2% YoY to THB
7,169.4 million supported by an increase in fare-box revenue and an increased O&M
income.Fare-box revenue increased 16.0% (or THB 781.6 million) to THB 5,677.1 million on
account of ridership growth (up 8.9% YoY to 214.7 million trips) and the increased average
fare (which rose by 6.5% YoY to THB 26.4 per trip, following the recent fare hike on 1 June
2013). Key ridership growth factors included organic growth and the commencement of 4
stations (from Wongwian Yai – Bang Wa) of the Silom line extension, which fed more
passengers to the Core Network. To accommodate the increasing patronage, the Company
introduced additional carriages into service (all trains on the Sukhumvit line were extended
Attachment 4 Page 12
from 3-car trains to 4-car trains since May 2013 and all of the new five 4-car trains became
available for service in February 2014). O&M revenue rose by 33.2% or THB 372.3 million
YoY to THB 1,492.3 million, mainly attributable to the additional service income from the
Silom line extension which opened on 5 December 2013.
Cost of Mass Transit revenue, including SG&A, rose by 17.9% or THB 639.6 million
YoY to THB 4,213.2 million, tied to higher ridership. Key cost items were cost of fare-box
which increased in line with the ridership growth, costs of train operation and maintenance
which increased in line with higher O&M revenue, and depreciation recorded (from higher
ridership and new trains). As costs and SG&A increased less than the revenue growth, this
led to the improvement in operating EBITDA margin to 65.9% in FY 13/14 (versus 64.8% in
FY 12/13).
8
Remarks: Mass Transit revenues include:
i) 16-day fare-box revenue
ii) Share of net profit (loss) from BTSGIF (included in ‘Share of profit from investments in associates and joint venture’
in Statement of comprehensive income)
iii) Service Income from Train & Bus Operation Management (included in ‘Service income’ under ‘Revenues from
provision of operating services’)
During the first 6 month of 2014/15 Total Mass Transit revenue9 increased 31.9%
YoY to THB 609.4 million supported by an increase in O&M income and an increase in share
of net profit from BTSGIF. O&M revenue rose by 36.3% or THB 104.5 million YoY to THB
392.2 million, mainly attributable to the additional service income from the Silom line
extension which opened on 5 December 2013 and the additional scope of work in BRT
contract.
Share of net profit from investment in BTSGIF units in 2Q 14/15 increased by THB
42.8 million or 24.6% YoY to THB 217.2 million. However, there was revision of amortisation
method for fund set-up cost from 3 years to the end of concession to be in line with other
BTSGIF related items. As such, the “share of net profit in BTSGIF” this quarter includes an
adjustment of the previous ‘over amortisation’ in the amount of THB 54.5 million.
This increase came from revision of amortisation method for fund set-up cost, offset
with the decrease in net fare-box revenue. Fare-box revenue of the core system rose by
2.7% YoY or THB 38.2 million to THB 1,455.0 million attributable to both ridership growth (up
2.1% YoY to 54.6million trips) and average fare increase (which rose by 0.6% YoY to THB
26.6 per trip). Cost of fare-box revenue rose at a faster rate than revenue growth, resulting in
the decline in net fare-box revenue.
Cost of Mass Transit revenue, including SG&A expenses, increased by 6.2% or THB
12.0 million YoY to THB 205.6 million, in line with higher O&M revenue. As operating
revenue grew more than the increase in operating cost and SG&A expenses, this led to an
improvement in the operating EBITDA margin to 66.8% in 2Q 14/15 (versus 59.8% in 2Q
13/14).
9
Remarks: Mass Transit revenues include:
i) Share of net profit (loss) from BTSGIF (included in ‘Share of profit from investments in associates’ in Statement of
comprehensive income)
ii) Service Income from Train & Bus Operation Management (included in ‘Service income’ under ‘Revenues from
provision of operating services’)
MEDIA
FY 2013/14 Even though the 30% revenue growth target was not achieved as a
result of consumption slowdown and political disruptions in the second half, our Media
business revenue still grew 11.7% (or THB 326.5 million) YoY to THB 3,121.2 million.
Factors contributing to our Media revenue growth mainly came from the revenue growth in
BTS-related Media
BTS-related Media revenue was THB 1,659.9 million, representing growth of 20.3%
or THB 280.6 million YoY. This was mainly due to (1) the aforementioned increase in
Attachment 4 Page 13
carriages; (2) the increase in capacity from i) Platform Truss LEDs ii) Platform Screen door
iii) Platform Truss Static and (3) increased merchandising revenue as a result of the increase
in rent for long-term contracts of merchandising space on the BTS station which became
effective this year, coupled with the increased occupancy of small rental shops on stations,
which grew with increased ridership.
Revenue from Modern Trade Media reached THB 1,295.2 million, an increase of
3.7% or THB 45.6 million YoY. Key growth drivers came from the increase in occupancy of
sales floor areas and the development of radio streaming technology in Big C branches
nationwide.
Office Building & Other Media revenue reached THB 166.1million, rising by 0.2%
YoY or THB 0.4 million. This increase was primarily supported by (1) higher sales from
additional office buildings and (2) full year recognition of the rights to advertise in
Chulalongkorn University’s bus system.
Cost of revenue increased 7.9% or THB 89.7 million YoY to THB 1,231.5 million and
Media SG&A increased by 8.9% or THB 32.8 million YoY to THB 399.7 million. As a result of
the improvement in operational performance in BTS-related Media, which is the biggest
contributor to total Media revenue, the operating EBITDA margin of the Media business
improved to 50.6% in FY 13/14 (49.6% in FY 12/13).
During the first 6 month of 2014/15 The economy continued to show signs of slow
recovery despite the establishment of clearer political policies. As a result, media advertising
spending grew 2.3% QoQ, in line with the slow economic growth momentum. Our Media
business outperformed the media industry with revenue growth of 4.4% from the previous
quarter to THB 787.0 million.
BTS-related Media continued to grow resiliently to THB 441.6 million with increased
revenue of THB 13.7 million (or 3.2% QoQ) mainly coming from (1) the increase in capacity
from new digital media (Platform Truss LEDs and Platform Screen Doors) on BTS stations,
(2) higher revenue from merchandising space and (3) higher revenue from In-Train static
media as a result of new sales strategies. Our Modern Trade Media revenue showed growth
of 6.4% due to increase in sales and Office Building and Other Media revenue grew 2.4% as
a result of the increase in office building contracts.
PROPERTY
FY 2013/14 Property operating revenue grew by 103.1% YoY or THB 1,489.4 million
to THB 2,934.1 million which was attributable from both Residential and Commercial
Property. Residential Property revenue increased by 159.5% YoY or THB 1,267.8 million to
THB 2,062.8 million in FY 13/14. The increase was mainly driven by sales of real estate of
THB 2,057.2 million (largely in relation to 610 transferred units of Tower A from Abstracts
Phahonyothin Park, which started transferring in December 2012). Commercial Property
revenue reached THB 861.9million, an increase of 33.6% YoY or THB 216.7 million. The
growth was largely driven by revenue from Eastin Grand Hotel operations at Surasak BTS
SkyTrain station. Revenue from Eastin Grand Hotel accelerated to THB 483.8 million,
representing 60.4% growth YoY. Furthermore, in this year the Group recognised a gain on
the sales of land at Bang Pakong and Bangna KM 18 of THB 379.3 million (versus a gain of
THB 999.7million from sale of investments of land in FY 12/13).
Operating costs rose at a lower rate than operating revenues. The increase of 90.8%
YoY or THB 835.4 million to THB 1,755.8 million was mainly from costs from transferred
units of Abstracts Phahonyothin Park and costs related to Eastin Grand Hotel. Property
SG&A expenses increased by 28.5% YoY or THB 154.7 million to THB 698.4 million mainly
driven by expenses related to transfers from Abstracts Phahonyothin Park, including transfer
fees, marketing expenses and sales commission. Due to the improved operating
performance, the Property business proved to be more profitable this year, with operating
Attachment 4 Page 14
EBITDA improving to THB 631.6 million compared to THB 116.7 million in the previous year
and the operating EBITDA margin improving to 21.5% versus 8.1% in FY 12/13.
During the first 6 month of 2014/15 Property operating revenue dropped a
significant 61.7% YoY or THB 532.4 million to THB 330.9 million, which was largely
attributable to the decline in Residential Property revenue as a result of fewer transferred
condominium units of Abstracts Phahonyothin Park (Tower A) compared to 2Q 13/14.
Residential Property revenue decreased by 81.7% YoY or THB 540.9 million to THB
121.2 million in 2Q 14/15. This decrease was mainly driven by a decline in sales of real
estate of THB 541.1 million (largely in relation to 33 transferred units of Abstracts
Phahonyothin Park (Tower A) in this quarter versus 201 transferred units in 2Q 13/14).
Commercial Property revenue reached THB 207.6 million, an increase of 4.3% YoY
or THB 8.6 million mainly supported by an improvement in Thana City Golf Course and the
Groups hotel business performance.
Operating costs decreased at the same rate as the reduction in operating revenues.
The decrease of 63.1% YoY or THB 329.5 million to THB 192.9 million was mainly from a
decline in costs from transferred units of Abstracts Phahonyothin Park. Property SG&A
expenses also decreased by 31.9% YoY or THB 60.8 million to THB 129.8 million largely
from the reduction in selling and marketing expenses related to Abstracts Condominium
project. As a result of the decrease in sales of real estate from the aforesaid reasons, the
operating EBITDA margin contracted to 13.9% in 2Q 14/15 compared to 21.8% in 2Q 13/14.
SERVICES
FY 2013/14 Services business revenue increased YoY by THB 278.5 million to THB
399.0 million. This increase was primarily due to (1) the growth in revenue generated from
Chef Man Restaurant of THB 219.7 million as well as (2) a growth in royalty fee recognised
from the co-ordination between BSS and its business partner from the issuance of the cobranded rabbit cards, which was launched in March 2013. As of 31 March 2014, over 2.5
million rabbit cards were issued, exceeding the target number of issued cards for FY 13/14.
Operating costs increased by 47.8% YoY or THB 67.1 million to THB 207.3 million,
increasing at a lower rate than operating revenue. There was also THB 225.9 million SG&A
expenses, an increase of 72.2% YoY. Key costs and SG&A items were mainly from staff
costs, food & beverage cost at Chef Man Restaurants and depreciation expenses (for
hardware, software and machines).
During the first 6 month of 2014/15 Services business revenue increased YoY by
THB 40.5 million or 39.1% to THB 144.2 million. This increase was primarily due to growth in
the revenue generated from ChefMan Restaurants (increased by THB 30.6 million or 57.2%
YoY to THB 84.0 million) as well as growth in the revenue from marketing and co-promotion
of rabbit cards of THB 13.0 million.
However, operating costs increased by 28.1% YoY or THB 14.5 million to THB 66.4
million, increasing at a lower rate than operating revenue. There were also THB 72.9 million
SG&A expenses, an increase of 56.9% YoY. Key costs and SG&A items were mainly from
staff costs, food & beverage cost at ChefMan Restaurants and depreciation expenses (for
hardware, software and machines).
Financial Status
• Assets
As of 31 March 2014, total assets stood at THB 76,757.1 million, a 14.1% increase
from 31 March 2013. Total current assets reduced by 28.7% to THB 37,226.8 million mainly
due to (1) the de-recognition of non-current assets held for sale of THB 42,123.1million from
the Group statement of financial position, in accordance with TFRS 5 following the sale of
future net fare-box revenues to BTSGIF as well as (2) a THB 960.5 million (or 27.4%)
Attachment 4 Page 15
reduction in real estate development costs to THB 2,549.8million as condominium units were
transferred to buyers. This was partially offset with (3) the increase in cash by THB 4,349.5
million (see further details in Cash Flow section) and (4) the increase in current investments
by THB 23,308.2 million, reflecting the treasury management of sales proceeds from
BTSGIF. Total non-current assets rose by 162.3% to THB 39,530.3 million largely from the
increase in (1) investment in associates by THB 13,888.9 million (primarily from the Group’s
investment in one-third of the units of BTSGIF) and (2) other long-term investments by THB
5,870.7 million, largely from the investment in fixed deposits of THB 1,082.3 million and
unsubordinated debentures (the long-term portion of THB 2,999.3 million were placed at a
financial institution in order to secure the principal and interest payment obligations with
respect to BTSC’s Long Term Debentures).
As of 30 September 2014, total assets stood at THB 71,305.7 million, a decrease of
THB 5,405.4 million or 7.0% from 31 March 2014. Total current assets stood at THB
31,806.2 million, decreasing 14.8% mainly from (1) a decrease in current investment of THB
2,991.1 million (mainly from the collateralised debenture, which was used to repay the third
tranche of BTSC debentures of THB 3,611.3 million and the reclassification of the fourth
tranche of BTSC debentures of THB 1,466.2 million to current portion from long-term
portion), (2) a reduction in cash of THB 2,712.8 million (see further details in Cash Flow
section), offset with (3) an increase in trade and other receivables of THB 377.4 million. Total
non-current assets was THB 39,499.5 million, an increase of 0.3% mainly from (1) an
increase in restricted deposits of THB 574.5 million (cash collateral placed with banks), (2)
an increase in PP&E of THB 567.7 million mainly for the development of U Sathorn hotel and
renovation of sport club in Thana City, offset by (3) a decrease in other long-term
investments of THB 1,337.9 million primarily from the aforementioned movement of the
fourth tranche of BTSC debentures which will mature in August 2015 to current portion.
• Liabilities
Increased from 31 March 2013 by 1.2% or THB 205.5 million to stand at THB
16,994.8 million largely due to increases in (1) deferred tax liabilities of THB 2,731.3 million
in accordance with TAS12 Income Taxes, (2) provision for future liabilities from Special
Business Tax levied on BTSGIF, to be absorbed by the Company of THB 1,083.5 million,
and (3) income tax payable of THB 840.9million largely from tax expenses related to BTSC
capital reduction, which offset with the effect of (4) the repayment of bank loans (THB
3,241.0 million) and (5) the second tranche repayment of BTSC debenture (THB 2,081.3
million) in August 2013.
Decreased from 31 March 2014 by 14.6% or THB 2,502.6 million to stand at THB
14,666.3 million largely due to (1) the third tranche repayment of BTSC debentures in
August 2014, (2) a decrease in income tax payable of THB 442.4 million, offset with (3) an
increase in loans from financial institutions of THB 1,195.5 million, of which THB 220.0
million was used by VGI to purchase MACO shares and THB 966.9 million were loans taken
to invest in offshore deposits and investments.
• Shareholders’ equity
As of 31 March 2013 total equity was increased by THB 9,260.6 million or 18.3% to
THB 59,762.3 million. This increase was attributable to (1) an increase in retained earnings
of THB 5,508.3 million largely from the gain from the sale of future net fare-box revenues to
BTSGIF, offset with dividend payments of THB 7,112.0 million, (2) increase in surplus from
the changes in the ownership interests in subsidiaries of THB 1,637.1 million mainly from the
sale of a portion of investment in subsidiary (VGI)10 and (3) increase in paid-up capital by
THB 3,230.4 million to THB 47,656.9 million resulting from the issuance of additional 807.6
million ordinary shares from the exercise of BTS-W2 and BTS-WA. As of 31 March 2014,
total issued and fully paid-up shares stood at 11,914.2 million shares.
Attachment 4 Page 16
As of 30 September 2014 total equity was decreased by THB 2,902.8 million or 4.9%
to THB 56,639.4million mainly attributable to (1) a reduction in surplus from the changes in
the ownership interests in subsidiaries of THB 574.9 million primarily as a result of the
Company increasing its shareholding in subsidiary VGI, (2) a decrease in non-controlling
interest of the subsidiaries of THB 415.4 million due to the purchases of investments in
subsidiaries (VGI and Nuvo Line) and (3) a reduction in unappropriated retained earnings
(excluding the portion reserved for treasury stock) of THB 2,143.3 million. The decline in
unappropriated retained earnings wad mainly from dividend payment of THB 2,501.4 million
for the period of October 2013 to March 2014. As of 30 September 2014, total issued and
fully paid-up shares stood at 11,914.2 million shares.
Remarks: 10The gain on sale of VGI shares was recorded in the consolidated statement of financial position as equity under
“surplus from the changes in the ownership interests in subsidiaries” but not recorded in the profit & loss
account, as the changes in the Company's ownership interest in a subsidiary do not result in a loss of control.
Liquidity
• Cash and Cash equivalents
Cash and cash equivalents as of 31 March 2014 reached THB 7,862.8 million. Net
cash from operating activities declined 30.9% to THB 3,218.5 million compared to THB
4,659.3 million in the previous year. Key contributors of the decrease were the sales of net
fare-box revenue to BTSGIF. Net cash from investing activities stood at THB 12,180.3
million from THB 4,097.7 million last year. Key items include the proceeds from the sale of
net fare-box revenue to BTSGIF, the reinvestment in BTSGIF units and the treasury
management of surplus cash proceeds from the sale. Net cash used in financing activities
was THB 11,048.4 million compared to THB 6,588.8million last year, mainly from debt
repayment of THB 5,322.3 million and dividend payment of THB 7,112.0 million, offset with
cash received from exercised warrants of THB 2,237.5 million. As a result, the consolidated
cash flow statements showed an increase of THB 4,349.5million in cash and cash
equivalents to THB 7,862.8 million from THB 3,513.3 million as of 31 March 2013.
For the six months ended 30 September 2014, cash and cash equivalents reached
THB 5,955.7million. Cash from operating activities was THB 1,080.1 million, declining 52.4%
or THB 1.2 bn primarily due to lower operating revenue of Property and Media businesses
and the decrease in trade and other payable of THB 508.2 million. Cash paid for corporate
income tax of THB 1.1bn (1H 13/14; THB 261.8 million) meant that net cash used in
operating activities was THB 186.3 million. Net cash from investing activities was THB
3,661.0 million. The key components are (1) decrease in current investment of THB 4,567.4
million largely from the repayment of the third tranche of BTSC debenture, (2) cash proceeds
from the sale of “available-for-sale” investments of THB 1,004.7 million, (3) dividend received
of THB 635.4 million (mainly from BTSGIF), (4) cash paid for purchases of other long-term
investments of THB 1,308.7 million and (5) investment in MACO of THB 681.2 million. Net
cash used in financing activities was THB 6,188.9 million mainly from (1) the cash paid for
the repayment of the third tranche of BTSC debenture of THB 3,611.3 million, (2) dividend
payment of THB 2,493.5 million, (3) net cash paid for purchases of investments in
subsidiaries of THB 618.5 million and (4) cash paid for the purchase of BTS Group treasury
stock of THB 925.5 million.
6.
Industry Outlook
6.1 Mass Transit Industry
BTS Sky Train
Attachment 4 Page 17
The BTS SkyTrain is Thailand’s first elevated electric railway system and is
constructed above some of central Bangkok’s major public roadways. The network, which
includes the Core Network and its subsequent extensions, comprises 34 stations across 2
separate lines with a combined track length of 36.3km. The Sukhumvit Line, or the Dark
Green Line, currently consists of 22 stations and runs northwards and eastwards from
central Bangkok, connecting Mo Chit and Bearing. The Silom Line, or the Light Green Line,
currently consists of 13 stations and runs through one of Bangkok’s central business
districts, connecting National Stadium and Bang Wa. Both lines intersect at Siam station.
MRT Subway
The MRT Subway is Bangkok’s first underground mass transit railway system in
Thailand and commenced operation on 3 July 2004. Thenetwork currently consists of only
one line, the Metropolitan Rapid Transit System Chaloem Ratchamongkhon Line (Blue Line),
which runs 20.0km through 18 stations from Hua Lamphong to Bang Sue; however,
construction of a second line, which runs 22.0km and covers 16 stations from Khlong Bang
Phai to Tao Poon (Purple Line), is already underway and expected to commence operation
in 2016. The current system is connected to the BTS SkyTrain at three stations: Sala Daeng,
Asok and Mo Chit stations. In 2013, the MRT Subway trains carried a total of 86.4 million
passengers on the system.
Suvarnabhumi Airport Rail Link
The Suvarnabhumi Airport Rail Link (SARL) is a rapid transit line that connects
Suvarnabhumi Airport to Phaya Thai station in central Bangkok. The line is 28.5km long and
is elevated, running above the existing eastern railway, with an underground terminal at the
airport. It is owned and operated by State Railway of Thailand (SRT). The SARL
commenced its operations on 23 August 2010. There are a total of three lines: a 15-minute
non-stop SA Express Line that runs from Makkasan station to the airport, an 18-minute nonstop SA Express Line that runs between Phaya Thai station and the airport, and the City
Line, an approximate 30-minute commuter rail service with stops at eight stations from the
airport to Phaya Thai station. The SARL connects directly with the existing BTS SkyTrain at
concourse level at Phaya Thai station. From 14 April 2014 onwards, the SA Express Line to
Phaya Thai station has been temporarily suspended until further notice.
6.2 Media Industry
In 2013/14, Thailand faced growing political uncertainty amidst economic slowdown
which adversely affected consumer confidence, and had a knock-on impact on the media
sector. This was reflected in media sector stocks, as the Entertainment Index dropped
19.0% in the year ended 31 December 2013, the worst performing sub-index on the Stock
Exchange of Thailand. Moreover, total market value of the Thai media industry dropped by
0.9% to THB 113,408 million in 2013/14, far below the Media Agency Association of
Thailand’s expectations of 10.0% growth. The performance of the media industry has a
tendency to strengthen or weaken depending on the country’s economy, which can be
observed by the relationship between GDP growth and advertising spending growth from
2007/08 to 2013/14. Hence, it is deduced that the decline in 2013/14 advertising growth was
caused by the country’s economy and political unrest, as evident from GDP drop of 1.4%A, a
significant drop from 7.8% growth achieved in 2012/13
A
Remark: The data was recalculated based on fiscal year from April to March from the Office of the National Economic and
Social Development Board
Graph: Media Advertising Growth vs GDP Growth (2007/08 - 2013/14)
Attachment 4 Page 18
Source:: National Econo
omic and Socia
al Development Board. The Nielsen Company (Thailand) Co., Ltd
Graph: Media Industry Mark
ket Share in
n Thailand in 2013/14
4
S
Source:
The Nie
elsen Company (Thailand) Co.,, Ltd and Form 56-1
5
(FY2013/14) of BTSG
Advertising Expe
enditure in Thailand in
n 2013/14 vs
v 2012/13 (THB millio
on)
6.3 Property
In spite of the year’ss fluctuation
n, the overa
all residenttial propertyy market still grew
slightly in 2013. Th
he survey of
o the Real Estate Inforrmation Cen
nter shows that the nu
umber of
newly completed and regisstered houssing units in Bangko
ok and viccinities1 (B
Bangkok
Metropo
olitan Regio
on) in 2013
3 increased
d 4.1% Yo
oY from 125
5,000 unitss to 130,10
00 units.
Except for a reducction in num
mber of unitss launched of
o single de
etached hou
uses, other types of
newly constructed
c
d housing units incre
eased from the previo
ous year. Amongst the
t
new
projectss, condomin
nium projeccts represen
nted 53% of
o total unitss, followed by single detached
house, townhouse
e, commercial buildin
ngs and tw
win house at 24%, 13%, 8% and
a
2%,
respecttively. Acco
ording to th
he survey of Colliers Internation
naltotal, total newly la
aunched
Atta
achment 4 Pag
ge 19
condomimium units in Bangkok during 2013 was 51,150 units, an increase of 8% from the
previous year.
Newly Completed & Registered Housing Units in 2013 and 2012
(Unit: Units)
AREA
Total
Condominium
Y2013
Y2012
4,900
28,300
49,600
77,900
64,300
8,400
4,800
32,300
19,900
52,200
60,700
2,700
17,100
9,700
60,600
69,500
130,100
125,000
2
13
8
47
53
Single
detached
house
Twin
House
Town
Commercial
House
Building
Bangkok
13,700
1,000
8,700
Vicinities
17,400
1,700
Bangkok-Vicinities
31,100
Percentage
24
Source: Real Estate Information Center
Remark: Vicinities mean Nonthaburi, Pathumthani, Samut Prakarn, Samut Sakhon and Nakhon Pathom
Agency for Real Estate Affairs reveal the outlook of housing market in 2013, there
were a total of over 1.16 hundred thousand units totaling over THB 3.58 billion, which grew
about 5 percent from a year ago. Condominium is still number one selling, followed by town
house and single detached house, respectively which corresponds to the launch of new
projects.The average price of housing in the past year to 2.928 THB million, 0.3 percent
down from last year. This decrease is not due to the fall of housing price, but because the
operator adjust to smaller size housing so that they can sell housing at prices acceptable to
customers. At the end of 2013, the cumulative supply in market for old and new projects is
approximately 1.44 hundred thousand units, condominiums accounted for approximately
35.6 percent, town house 31 percent and single detachec house 25.9 percent.
Attachment 4 Page 20
Attachment 5
Special and/or significant agenda which requires approval of the Shareholders’ Meeting with not
less than three-quarters of votes pursuant to the applicable laws are summarized as follows:
Applicable Rules and
Regulations
Special/Significant Agenda
Favorable Votes of Shareholders’ Meeting
The Public Limited
Company Act and the
Company’s Articles of
Association
Sale or transfer of the whole or substantial
parts of the business of the Company to
other persons
Purchase or acceptance of transfer of the
business of other companies or private
companies by the Company
Execution, amendment or termination of
contracts with respect to the granting of a
lease of the whole or substantial parts of the
business of the Company
Entrustment of the management of the
business of the Company
Amalgamation of the business with other
persons for the purpose of profit and loss
sharing
Amendment of the Memorandum of
Association and the Articles of Association
Increase or decrease of the Company’s
registered capital
Issuance of debentures
Merger or dissolution of the Company
Favorable votes of not less than three-quarters
of all votes of the shareholders attending the
Meeting and having the voting rights
SEC Office
Notifications
Execution of connected transactions
Execution of significant transactions which
fall into the scope of an acquisition or
disposition of assets
Favorable votes of not less than three-quarters
of all votes of the shareholders attending the
Meeting and having the voting rights
Application for a waiver to acquire the capital
increase ordinary shares without making a
tender offer for all securities of the business
by virtue of the resolution of the
Shareholders’ Meeting (Whitewash)
Favorable votes of not less than three-quarters
of all votes of the shareholders attending the
Meeting and having the voting rights, without the
shareholders holding among them representing
at least 5 percent of all votes of the
shareholders attending the Meeting and casting
votes against (as the case may be)
Issuance of securities to directors or
employees (ESOP)
Offering of newly issued shares by way of
private placement at a price lower than 90.00
percent of the market price
Favorable votes of not less than three-quarters
of all votes of the shareholders attending the
Meeting and having the voting rights, without the
shareholders holding among them representing
at least 5 percent or 10 percent (as the case
may be) of all votes of the shareholders
attending the Meeting and casting votes against
the said offering of shares
Application for delisting of securities from the
Stock Exchange of Thailand or MAI
Favorable votes of not less than three-quarters
of the total issued shares, without the
shareholders holding among them representing
at least 10 percent of the Company’s total
issued shares casting votes against the
application for delisting of securities
Notifications of the
Stock Exchange of
Thailand
Attachment 5