AP ready to commit B800m

BackMay 17, 2007

The weak property market is not stopping Asian Property Development Plc (AP) from investing in new projects, according to chief executive Anuphong Asavabhokin. The company plans to spend 800 million baht on three or four land plots for middle-and high-end condominiums and middle- to high-end townhouses.

He said the company had room for new investment as its debt-to-equity ratio was a modest 0.6 times. It will also generate cash from housing sales worth 3.5 billion baht in the first quarter.

During the first four months of the year, AP spent 1.2 billion baht to acquire three land plots in the Sutthisarn, Sathon Soi 10 and Phahon Yothin areas for developing the middle- to low-end condominiums under its Life brand, worth three billion baht.

The company will also spend over 30 million baht on marketing and advertising for its Life brand, which would help AP to appeal to a younger audience, said Mr Anuphong.

AP reported a net profit of 158.3 million baht for the first quarter, down 32.2% year-on-year and 34.1% quarter-on-quarter. This was mainly due to lower revenue recognition and higher sales and administration expenses.

Its revenue in the first quarter dropped by 8.5% from 1.5 billion baht in the same period of last year to 1.41 billion baht. Lower revenue was caused by slow sales bookings in the beginning of the year due to the Bangkok bombings, he said.

Mr Anuphong said the company hoped to earn seven billion baht by the end of the year, up from six billion in 2006.

At the end of the first quarter, it had a total backlog of 12 billion baht. About 4.2 billion baht would be realised in 2007 and the remaining seven billion baht in 2008-09.

He said the company planned to launch three townhouse projects worth a combined 1.71 billion baht in the second half of the year. They would be located in the Chokchai-Sena, Krungthep-Kreeta and Lat Phrao areas with 79, 113 and 350 units respectively.

The Address Chidlom, a high-end condominium worth three billion baht launched in the first quarter, is already 60% sold while three Life condominiums are 50% sold.

AP shares closed yesterday on the SET at 4.62 baht, down six satang, in trade worth 24.75 million baht.

 

Source: Bangkok Post by Kanana Katharangsiporn
Thursday May 17, 2007