WHA Group, Cautious Yet Confident Sees Strong Positive Signs for Expansion and Targets 30% Growth in 2021

BackFeb 02, 2021

Bangkok, February 2, 2021 – WHA Group unveiled its business plan for 2021 and beyond. Despite the challenging environment due to the Covid-19 pandemic, WHA recorded a series of achievements in 2020, including growth in its Logistics hub driven by booming E-commerce activities, the signing of new customer contracts in its industrial zone project in Vietnam, successful capital increases of WHART and HREIT, with more than THB 4,870 million fund raised, and credit rating maintained at A-. The Group foresees new developments and growth in 2021 in its four business hubs, with its normalized total revenue and share of profits expected to increase at least 30% while maintaining a high EBITDA1 margin of over 35%. These will be supported by the reinforcement of its leadership in Thailand, the acceleration of its expansion in Vietnam, and the continuous development of high value-added products leveraging on new technologies.

WHA 2020 Key Highlights

In 2020, WHA Group confirmed its status as Thailand’s leading developer of Logistics Properties, Industrial Estates, Industrial Utilities and Power and provider of Digital Platform. While the Covid-19 pandemic had an adverse impact on the Group’s 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 strong.

Despite the situation, a number of WHA businesses showed excellent performance. The Logistics hub experienced growth, driven by E-Commerce and demand for industrial and warehouse facilities in Thailand, approximately 130,600 occupied square meters were added in 2020 with an additional 112,000 square-meters of lucrative short-term contracts.

In Vietnam, large FDI inflows led to significant industrial land sales at the Group’s industrial zone in Nghe An province, where half of the project’s Phase 1 Milestone 1, representing a gross area of 900 rai, has been secured.

As the risks resulting from the Covid situation gradually fade, strong market recovery is expected. WHA Group prepared itself and introduced new products and services in collaboration with new partners. Among the new activities is the establishment of a joint venture with Tus-Holdings, a leading Chinese Science and Technology group, to launch Thailand’s first TusPark WHA Incubation Center in downtown Bangkok. Another joint-venture company was established with Bangkok Industrial Gas (BIG) for the production and distribution of industrial gas to WHA industrial estate customers.

With Vietnam now tagged as one of the preferred destinations of international investors, and one of the major beneficiary of supply chain relocations, apart from Thailand, WHA signed a Memorandum of Understanding (MoU) last December with Thanh Hoa Provincial People’s Committee (Thanh Hoa PPC) for the development of another two industrial zones in Thanh Hoa province, representing a total gross area of nearly 7,500 rai, marking a new major milestone in WHA Group’s international expansion. WHA industrial estates in Thailand have also developed and expanded further. WHA Eastern Seaboard Industrial Estate 3 (WHA ESIE 3), covering 2,200 rai, was completed, while the construction of WHA Rayong 36, the Group’s 11th industrial estate in Thailand with an area of 1,281 rai, started in Q4 2020.

The Utilities and Power business is enhancing its offering of high value products, with the operations commencement of WHA’s Wastewater Reclamation Plant – the largest in Thailand with an annual capacity of 9,125,000 cubic meters – and its Demineralized Water Plant with the annual maximum capacity of 4,400,000 cubic meters to supply demineralized water to Global Power Synergy Plc (GPSC). Despite the drought and COVID situations, WHAUP managed to increase its water sales and managed volume by 3.7% year on year to 114 million cubic meters. Higher demand for renewable energy facilitated the development of the solar energy business, now totaling 50.8 MW in terms of signed contracts and resulting in a total installed capacity of 590 equity MW.

WHA Digital increased its activities as well, with the signing in June 2020 of an agreement with JasTel Network Company Limited (JasTel) for the use of 109 racks in WHA’s data centers. WHA collaborated with major telecommunication players to conduct 5G network planning and 5G solutions in WHA industrial estates.

In 2020, WHA Group successfully issued 2 REITS, raising more than THB 4,870 million of capital. HREIT increased its capital for the second time to invest in 48,127 square meters of factory and warehouse rental spaces. Similarly, WHART raised capital for the fifth time, to invest in 3 mega logistics centers with a total area of 128,789 square meters.

The Group’s estimated normalized total revenue and share of profits in 2020 amount to THB 9.4 billion, decreasing 14% from the previous year, with a total asset value of THB 83 billion. The Group was able to maintain its credit rating at A-.

“Despite last year’s challenging environment due to the Covid-19 pandemic, our solid business model, the rigorous responses we anticipated, as well as the steps taken to protect the interests of our customers, allowed us to minimize its impact,” declared Ms. Jareeporn Jarukornsakul, Chairman and Group CEO of WHA Corporation Pcl. “During these challenging times, we were able to increase our activities in many businesses, initiate high-value products and services, expand new projects both in Thailand and in Vietnam, as well as maintain strong financial position and financing capability. We have reached a number of key milestones and look forward to continuous innovations, higher investments, and an improved business environment for 2021” she said.

Outlook for 2021 and Beyond

To kick start the year, the Group inaugurates WHA Tower, its new headquarters located on Debaratna Road (Bangna Trad) KM 7. The 25-storey Grade A office building offers over 52,000 square meters of high-end office space for WHA employees and customers, and other tenants attracted by its convenient location and accessibility, its future-ready technology, and Asia-Pacific Property award-winning commercial high-rise architectural design.

“We enter 2021 with optimism, while maintaining an edge of caution. With the plans and strategies we intend to initiate, plus our upcoming projects currently under development, we expect a recovery within the coming months and positive financial performance. We anticipate our normalized total revenue and share of profits to increase by at least 30% from last year, while sustaining our high profitability level with an EBITDA margin of over 35%. To maintain sustainable growth in the future, our forecasted 2021-2025 investment plan totals THB 56,000 million while targeting interest bearing debt to equity ratio of not more than 1.5 time. Despite the challenges, we continue to move forward with confidence, thanks to our established strengths and our capabilities to adapt to the new fast-changing world,” concluded Ms. Jareeporn.

1 EBITDA: Earnings before interest, tax, depreciation and amortization