WHA Corporation Public Company Limited (the “Company”) submitted its separate financial statement and its consolidated financial statement for the full-year 2020 ended on 31 December 2020 which were audited by the auditor. The Company hereby clarifies the performance as follows:

MACROECONOMIC & COMPANY OVERVIEW
Thailand Economic 2020 and 2021 Outlook

According to the Office of National Economic and Social Development Council (NESDB), Thai GDP in 2020 had minus 6.1% from the decrease of export value, private consumption and investment value of 6.6%, 1.0% and 4.8%, respectively which was mainly from the COVID-19 pandemic having impact to Thai and World Economy.

In 2021, Thai economy is expected to expand 2.5%-3.5% from (i) the recovery of the World Economy and the global trade volume; (ii) the government stimulus measures; (iii) the rebound of domestic demand; and (iv) the unusually low base effect in 2020.

Thailand 2020 Investment and Foreign Direct Investment Applications

The Thailand Board of Investment (BOI) announced that in 2020, there was a total of 1,717 applications for investment promotion, representing a combined investment value of THB 481,150 mm, decreased by 30% YoY from last year applications having investment value of THB 691,390 mm. However, the 2019 filed applications was included the investment in High-Speed Rail linked 3 airports project having project value of THB 162,320 mm including the coronavirus outbreak affecting to the number of applications from foreign significantly. Regarding to Foreign Direct Investment (FDI), there were 907 project applications filed in 2020 worth a total investment value of THB 213,162 mm, decreased by 54% YoY. The FDI were led by Japanese companies, which topped the ranking both in terms of the number and value of applications, followed by an investment from China and the US in the third place.

Applications for projects in the target industries, sectors with strategic importance for the country’s economic development, amounted to THB 230,740 mm, accounting for 48% of the total value of BOI applications. The top five sectors by value were: 1) Electrical Appliances and Electronics, 2) Agriculture and Food Processing, 3) Automotive and Parts, 4) Petrochemicals and Chemicals and 5) Biotechnology. Furthermore, the medical sector has posted a noticeable increase of the value of applications that grew 165% from 2019 to THB 22,290 mm in 2020.

Company Overview

Despite the COVID-19 pandemic and the uncertainties in 2020, the Company showed excellent performance. The Logistics business experienced strong growth, driven by E-Commerce and demand for premium distribution center and warehouse facilities in Thailand, approximately 130,600 occupied sqm were added in 2020 with an additional 112,000 sqm of lucrative short-term contracts. While COVID-19 pandemic had an adverse impact and caused a slowdown on industrial land sales in Thailand due to temporary travel restrictions, industrial land customer enquiries have been resilient, with Thailand’s economic fundamentals and investment attractiveness remaining solid. In Vietnam, large FDI inflows led to significant industrial land sales at the Company’s industrial zone in Nghe An province, where the Company is pushing the construction of remaining 2,100 rai of Phase 1B and expediting the approval process of Phase 2 and Phase 3, covering additional 4,700 rai of land area. During the last quarter, the Company signed a collaboration agreement with the local government of Thanh Hoa province to develop two industrial zones - (1) WHA Smart Technology Industrial Zone – Thanh Hoa, and (2) WHA Northern Industrial Zone – Thanh Hoa, with a combined land area of 7,500 rai. This marked another successful milestone for WHA Group’s overseas business.

For Utilities business, the COVID-19 pandemic and the drought situation during the first half of 2020 caused a decrease of water demand. However, during the second half of the year after the situation recovery, water demand increased from the automotive customers and the new projects of petrochemical operators. In additions, the Company already extended its utilities portfolio to cover high-value products and innovative water offerings that include Thailand’s biggest Reclamation Water and Demineralized Water plant. Even though water sale volume in Vietnam has gradually improved during the last quarter that showed highest demand, delay project construction has led to additional shared losses apart from recorded amortization expense that reflects the acquisition of SDWTP project. Total 2020 volume of utilities sales and under management is 113.5 million cubic meters, increasing 3.7% from previous year. Domestic sales contributed 95.5 million cubic meters while Vietnam achieved 18.0 million cubic meters.

For Power business, the Company recorded lower share of profit in 2020, due to a decrease in share of profit from investment in GHECO-One coal-fired power plant. Despite of lower revenue, GHECO-One still generated strong cashflow as debt services declined correspondingly with Availability Payment. On the contrary, the Company recorded higher revenue from power business in 2020 since the Company secured a great number of new solar projects both rooftop, carpark, farm and floating. The Company signed additional 9 Solar PPA contracts of 19 MW and commercialized additional 30.5 MW. The Company ended its 2020 with power capacity at 590 equity MW

Digital Platform, the Company committed to develop and offer new services and innovative digital products to respond to increasing and more sophisticated customer demand. In 2020, the Company implemented and already provided FTTx services within WHA Group’s 10 industrial estates. It also collaborated with major telecommunication players to conduct 5G network planning and 5G solutions in WHA industrial estates. In 2020, the Company had successfully 2 asset monetization in WHART and HREIT. WHART raised capital for the fifth time to invest in 3 mega logistics centers with a total area of 128,789 sqm. Similarly, HREIT increased its capital for the second time to invest in 48,127 sqm of factory and warehouse rental spaces. Furthermore, the company moves to WHA Tower, its new headquarters located on Debaratna Road (Bangna Trad) KM 7. The 25-storey Grade A office building offers gross area of 52,000 sqm and leasable area of 25,000 sqm. Office spaces are now available for rent.

FINANCIAL ANALYSIS

During 2020, the Company had the total revenue and share of profit and net profit of THB 9,406.6 mm and THB 2,523.7 mm, respectively. If excluding FX impact and extra items, the Company had the normalized total revenue and share of profit and normalized net profit of THB 9,376.0 mm and THB 2,542.6 mm, respectively. The details are as follows:

FINANCIAL PERFORMANCE

Consolidated Financial Statements Q4 2019 Q4 2020 Change YoY 2019 2020 Change YoY
THB mm THB mm % THB mm THB mm %
Total Revenue and Share of Profit 4,264.4 4,550.7 6.7% 13,385.8 9,406.6 (29.7%)
Total Cost 1,989.3 2,120.5 6.6% 6,400.8 3,841.3 (40.0%)
Gross Profit 1,889.6 2,285.7 21.0% 6,007.9 4,281.8 (28.7%)
Net Profit 1,201.1 1,453.9 21.0% 3,229.3 2,523.7 (21.8%)
Normalized Total Revenue /1 4,254.5 4,482.6 5.4% 10,898.8 9,376.0 (14.0%)
Normalized Net Profit /2 1,212.7 1,387.3 14.4% 2,765.7 2,542.6 (8.1%)

/1 Normalized Total Revenue = Total Revenue excluding FX impact, Extra item and Deferred Revenue Item

/2 Normalized Net Profit = Net Profit excluding FX impact, Extra item, TFRS9&16 impact and Deferred Revenue Item Deferred Revenue Item = Deferred revenue from assets monetization to WHABT in 2015 which recognized in the first quarter of 2019 as a result of accounting standard adjustment (TFRS 15)



KEY HIGHLIGHTS
  • Total Revenue and Share of Profit and Net Profit for 2020 were THB 9,406.6 mm and THB 2,523.7 mm, respectively. This statutory figure consists of the normal business operation and FX impacts, which was almost all unrealized gain/loss. In addition, the Company’s Normalized Total Revenue and Share of Profit and Normalized Net Profit stood at THB 9,376.0 mm and THB 2,542.6 mm, respectively.
  • Normalized Rental Revenue during 2020 increased by 23.0% to THB 1,157.1 mm, compared to the same period of previous year, which was mainly due to increase in lettable area for both logistics and industrial properties.
  • Revenue from sale of investment properties during 2020 increased by 32.1% to THB 2,048.1 mm, compared to the same period of last year. In 2020, the Company had successfully 2 assets monetization to both WHART and HREIT, whereas, in 2019, the Company had only asset monetization to WHART.
  • Revenue from Land Business and Sale of Properties for 2020 was THB 1,883.9 mm, decreased by 46.3%, compared to the same period of last year, which was mainly from temporary international travel restriction from COVID-19 pandemic. As a result, the customers could not transfer the land; however, the Company still receives strong interests for our industrial estates from the number of potential customers, especially from China, Japan and US manufacturers as a result of production line relocation from China to Southeast Asia countries. Furthermore, the fundamental of Thailand as the regional production hub remains strong, but also reflected the potential and strength of WHA Group’s industrial estates, which can fully support the needs of both local and international customers. Also, the Company had the revenue from right of ways of THB 396.9 mm during this year.
  • Utilities Income during 2020 decreased by 9.5%, compared to the same period of last year, which was from decrease in domestic utilities sale volume approx. 10.0% as a result of the COVID-19 pandemic and the drought situation.
  • Normalized Share of Profit from Investment in Power Associates and Joint Ventures for 2020 was THB 940.4 mm which decreased by 32.0%, compared to the same period of last year. The decrease in Normalized Share of Profit from Investment in Power Associates and Joint Ventures was mainly due to the reduction of AP from Gheco-1 according to PPA, lower coal price, higher corporate income tax and planned maintenance shutdown of 4 SPPs in 2020.
  • Finance Cost increased to THB 1,112.3 mm which increased by 12.8%, compared to the same period of last year due to the accounting impact of early redemption of bond. If excluding such an impact, the finance cost increased by 1.8%. However, the Company’s weighted average cost of fund decreased by 0.37% (decreasing from 3.41% at the end of 2019 to 3.04% at the end of 2020).
  • All in all, the Company had Net Profit and Normalized Net Profit during 2020 at THB 2,523.7 mm and THB 2,542.6 mm, respectively and decreased by 21.8% and 8.1%, respectively, compared to the same period of previous year

PERFORMANCE BY BUSINESS
Rental Properties Business

Q4 2019 Q4 2020 เChange YoY 2019 2020 Change YoY
THB mm THB mm % THB mm THB mm %
Rental and Service
Rental Revenue 273.9 300.4 9.7% 991.3 1,157.1 16.7%
Normalized Rental Revenue /1 273.9 300.4 9.7% 940.7 1,157.1 23.0%
Gross Profit 163.3 208.1 27.4% 587.7 805.5 37.1%
Gross Profit Margin 59.6% 69.3% 59.3% 69.6%
GPM before adjustment with PPA /2 60.0% 69.3% 59.5% 69.7%
Sale of Investment Properties
Revenue from Investment Properties /3 1,512.2 2,046.5 35.3% 1,550.7 2,048.1 32.1%
Gross Profit 560.1 847.2 51.3% 563.1 847.4 50.5%
Gross Profit Margin 37.0% 41.4% 36.3% 41.4%
Share of Profit from Investment Properties 239.8 320.5 33.6% 239.8 320.5 33.6%

/1 Excluding rental and service income from WHABT

/2 Excluding accounting impact of Purchase Price Allocation (PPA)

/3 Excluding Deferred Revenue Item



  1. Rental and Service Income
    • Rental and service income from warehouses, distribution centers, factories and structural work during 2020 was THB 1,157.1 mm which increased by 16.7%, from the same period of previous year. The normalized rental and service income for 2020 increased by 23.0%, compared to the same period of previous year, which was mainly due to increase in lettable area for both logistics and industrial properties. Besides, in 2020, there were new 5 logistics facilities having lettable area approx. 130,000 sqm.
    • Gross profit margin from rental and service of warehouses, distribution centers, factories and structural work during 2020 was 69.6%, which increased from the same period of previous year because of the higher number of lettable area and cost efficiency management.
  2. Sale of Investment Properties
    • Revenue from sale of investment properties during 2020 stood at THB 2,048.1 mm which increased by 32.1%, compared to the same period of last year; consisting of revenue from asset monetization to WHART of THB 982.3 mm and revenue from asset monetization to HREIT of THB 1,065.9 mm.
    • Gross profit margin from sale of investment properties during 2020 was 41.4%, increased from 36.3% in 2019. Because, in 2020, the Company had successfully assets monetization to both WHART and HREIT, whereas, in 2019, there was only asset monetization to WHART.
    • Share of profit from sale of investment properties during 2020 was THB 320.5 mm, increased by 33.6%, compared to the same period of pervious year from the monetization of JV assets.

Industrial Development Business

Q4 2019 Q4 2020 Change YoY 2019 2020 Change YoY
THB mm THB mm % THB mm THB mm %
Revenue 1,032.0 691.1 (33.0%) 3,505.0 1,883.9 (46.3%)
Gross Profit 461.3 266.9 (42.1%) 1,777.2 1,029.6 (42.1%)
Gross Profit Margin 44.7% 38.6%   50.7% 54.7%  
GPM before adjustment with PPA /1 56.4% 42.5%   55.3% 56.0%  

/1 Excluding accounting impact from Purchase Price Allocation (PPA)



Revenue from land business and sale of properties during 2020 was THB 1,883.9 mm, decreased by 46.3%, compared to the same period of last year, which was mainly from international travel restriction from the COVID-19 pandemic. As a result, the customers could not transfer the land; however, the potential customers still receive the strong interests for our industrial estates, especially, China, Japan and US manufacturers as a result of production line relocation from China to Southeast Asia countries. The fundamental of Thailand as the regional production hub remains strong, but also reflected the potential and strength of WHA Group’s industrial estates, which fully support both local and international customers’ requirements. Also, the Company had the revenue from right of ways of THB 396.9 mm during this year.

Gross profit margin from land business and sale of properties during 2020 stood at 54.7% which increased from the same period of last year due to the revenue recognition of right of ways. However, if excluding such revenue, the gross profit margin was at 42.5% in 2020 which decreased from last year from the revenue recognition of land sale in Vietnam having a lower gross profit margin.

Utilities & Power Business

Q4 2019 Q4 2020 Change YoY 2019 2020 Change YoY
THB mm THB mm % THB mm THB mm %
Revenue 568.4 534.6 (5.9%) 2,258.7 2,043.2 (9.5%)
Gross Profit 223.0 177.6 (20.4%) 954.8 721.8 (24.4%)
Gross Profit Margin 39.2% 33.2%   42.3% 35.3%  
GPM before adjustment with PPA/1 42.2% 36.4%   45.3% 38.7%  
Share of Profit from Investments in Utilities Associates (13.5) (27.7) (105.3%) (13.5) (151.3) (1,023.4%)
Share of Profit from Investments in Power Associates 355.0 430.9 21.4% 1,780.5 978.5 (45.0%)
- Normalized Share of Profit from Investments in Power Associates/2 283.5 200.4 (29.3%) 1,383.1 940.4 (32.0%)
- FX Gain (Loss) 71.5 230.5 222.2% 337.5 38.1 (88.7%)
- Extra Item n.a. 60.0 - (100.0%)

/1 Excluding accounting impact of Purchase Price Allocation (PPA)

/2 Excluding Gain (Loss) from FX and Extra item



Utilities income during 2020 was THB 2,043.2 mm, which decreased by 9.5%, compared to the same period of previous year, which was mainly from lower excessive charge including lower sale volume approx. 10.0% as a result of COVID-19 pandemic and drought situation.

Gross profit margin from utilities income during 2020 was at 35.3%. This gross margin had accounted for the fair value adjustment of the acquired business according to the accounting standards under WHA level. However, the genuine gross margin in 2020 was at 38.7% decreasing from the same period of previous year due to decrease of revenue from lower excessive charge and recorded depreciation costs of new projects.

Share of Profit from Investments in Associates from Utility Business during 2020 was THB (151.3) mm due to the share of loss from SDWTP, resulting from start to record depreciation, lower sale volume and the delay in the construction of pipeline expansion to connection points of water distributors due to the lockdown measurement in Vietnam during COVID-19 pandemic and accounting impact from fair value adjustment of the acquired business.

Normalized Share of Profit from Investments in Associates from Power Business and Joint Ventures during 2020 was THB 940.4 mm, which decreased by 32.0%, compared to the same period of last year. If including the FX impact, which is mostly unrealized gain/loss, share of profit from power associates and joint ventures stood at THB 978.5 mm. The decrease in normalized share of profit from power associates and joint ventures was mainly due to the reduction of AP from Gheco-1 according to PPA, lower coal price, higher corporate income tax and planned maintenance shutdown of 4 SPPs in 2020.

Other Income

Q4 2019 Q4 2020 Change YoY 2019 2020 Change YoY
THB mm THB mm % THB mm THB mm %
Dividend and management income 227.9 180.4 (20.8%) 540.7 527.4 (2.5%)
Others 157.6 (35.9) (122.8%) 436.4 359.2 (17.7%)
Total other income 385.5 144.5 (62.5%) 977.1 886.7 (9.3%)
Normalized others /1 157.6 126.4 (19.8%) 436.4 366.7 (16.0%)
Normalized total other income /1 385.5 306.8 (20.4%) 977.1 894.1 (8.5%)

/1 Excluding FX impact

Normalized other income during 2020 stood at THB 894.1 mm which decreased by 8.5% from the same period of previous year, which was mainly from:

  • Dividend and management income during 2020 was THB 527.4 mm, decreased by 2.5% from the same period of previous year due to decrease of dividend income from Glow IPP.
  • Normalized other income comprised of interest income, gain from sale of short-term investments and other income totaling THB 366.7 mm during 2020, decreased by 16.0% from the same period of 2019.

Expense Analysis

Q4 2019 Q4 2020 Change YoY 2019 2020 Change YoY
THB mm THB mm % THB mm THB mm %
Selling expense 93.3 53.2 (43.0%) 325.6 145.2 (55.4%)
Administrative expense 425.0 365.8 (13.9%) 1,405.2 1,150.1 (18.2%)
Finance costs 282.0 289.0 2.5% 986.4 1,112.3 12.8%
Total expense 800.4 708.0 (11.5%) 2,717.2 2,407.7 (11.4%)
Normalized finance costs 282.0 289.0 2.5% 1,092.3 1,112.3 1.8%


  1. Selling expense during 2020 was THB 145.2 mm, which decreased by 55.4%, compared to the same period of last year, mainly from lower number of land transfer.
  2. Administrative expense during 2020 was THB 1,150.1 mm, which decreased by 18.2%, compared to the same period of last year, which was mainly from cost efficiency management.
  3. Finance costs during 2020 was THB 1,112.3 mm which increased by 12.8% compared to the same period of previous year due to the accounting impact of early redemption of bond. If excluding such an impact, the normalized finance costs increased by 1.8%. However, the Company’s weighted average cost of fund decreased by 0.37% (decreasing from 3.41% at the end of 2019 to 3.04% at the end of 2020).

FINANCIAL POSITION

The changes in Consolidated Balance Sheet as of 31 December 2020 are summarized as follows.

Assets
As of 31 December 2020, the Company had total assets of THB 82,621.1 mm, increasing by THB 357.3 mm from THB 82,263.8 mm as of 31 December 2019. The main reasons are as follows:

  1. Increase in investment properties (net) of THB 1,647.0 mm, from continuously developed new projects.
  2. Increase in properties, plants and equipment (net) of THB 1,202.8 mm, mainly from the increase in equipment related to solar rooftop business and investment of reclaimed water project.
  3. Decrease in investment in associates of THB 1,967.5 mm, mainly from the adoption of new accounting standard (TFRS 9), reflecting to the mark-to-market of financial instruments in associates of power business.
  4. Decrease in investment in available-for-sale of THB 1,288.0 mm, due to decrease in investment value of REITs from market price change.

Liabilities
As of 31 December 2020, the Company had total liabilities of THB 50,453.9 mm, which increased by THB 1,290.7 mm from THB 49,163.2 mm as of 31 December 2019. Some increase was from bank loan drawdown in order to preserve for the money market fluctuation during COVID-19. Besides, the Company had interest bearing debt of THB 41,253.7 mm, which increased by THB 2,029.4 mm from THB 39,224.3 mm. However, the weighted average cost of fund of the Company decreased by 0.37% (decreasing from 3.41% as of ended 2019 to 3.04% as of ended 2020).

During 2020, the Company had utilized additional short-term and long-term facilities, accounting for THB 6,998.9 mm and had bond repayment of THB 4,937.8 mm. As a result, interest bearing debt of the Company increased by THB 2,029.4 mm, mainly from the capital expenditure of new projects together with the Company’s liquidity management.

Shareholder’s equity
As of 31 December 2020, the Company had total shareholder’s equity of THB 32,167.2 mm, which decreased by THB 993.4 mm from THB 33,100.6 mm as of 31 December 2019, mainly from decrease in market price of WHART, HREIT and WHABT together with the adoption of new accounting standard (TFRS 9), reflecting to the mark-to-market of financial instruments in associates.

Unit Price and Investment Value of REITs

  Unit Price (THB) Increase/(Decrease)
of investment value
Ended 2019 Ended 2020
31 Dec 2019 31 Dec 2020 (THB mm)
WHART 17.4 13.3 (1,571.2)
HREIT 8.8 7.7 (121.2)
WHABT 9.7 8.6 (33.3)
Total     (1,725.7)

KEY FINANCIAL RATIOS

  2019 2020
Gross Profit Margin (%) 38.8% 44.4%
Net Profit Margin (%) 24.1% 26.8%
D/E Ratio (times) 1.5 1.6
Net IBD to Equity (times) 1.2 1.3