ALL posted a strong Q3/62 performance with net profit margin making a new high at 20% Ready to aggressively build its recurring income and expanding its housing business to reinforce its status as total real estate solutions leader
All Inspire Development PCL. or ‘ALL’ showed a growing performance despite the property market slowdown and generated total revenue of 647 million baht in the third quarter of 2019, rising 39% from the same period last year, with net profit surging 172% to 129 million baht. Its net profit margin stood at 20%. For the nine-month period, ALL had total revenue exceeding 2.34 billion baht, a 46% increase year-on-year, and net profit of 342 million baht, up 61%. This signals that the Q4/62 performance will have a peak, spurred by the high season of property business, government’s stimulus measures to reduce property transfer tax and mortgage registration fee, and the reduction of benchmark interest rate. All of these positive factors will drive ALL’s property sales. The company plans to penetrate all horizontal housing segments to reinforce its status as the total real estate solutions provider and one among top ten property companies.
Mr. Thanakorn Thanawarith, Chief Executive Officer of All Inspire Development Plc or ALL, revealed that the company’s performance in the first nine months of 2019 was very good in terms of revenue, net profit and sales due to its understanding and flexibility to revise its business plan to suit changing economic situations, together with the strategy to develop condominiums along the mass transit lines to serve real demand at affordable prices. ALL’s condominium projects got an overwhelming response from buyers, reflecting rising accumulated sales.
For the performance in Q3/2019 (July – September 2019), the company generated total revenue of 647 million baht, growing 39% from 466 million baht in the same period of the year before, and net profit of 129 million baht, a 172% rise year-on-year, equivalent to the net profit margin of 20%. Contributing to the rise was revenue from property unit transfer valued 2.03 billion baht, rising 45% when compared to revenue of 1.39 billion baht from the property transfer in the same period in 2018. The outstanding revenue increase came from the unit ownership from three projects namely the 720-million-baht The Excel Khukot, the 1.6-billion-baht Rise Rama 9, and the 1.4-billion-baht The Vision Ladprao – Nawamin.
“At the end of Q3/2019, ALL has backlog on hands worth 11.4 billion baht, of which 300 million baht from townhome projects, 3.4 billion baht from high-rise projects, and 7.7 billion baht from low-rise projects, to be gradually recognized in the next 2 – 3 years (2019 – 2022). We’re confident that our performance during 2020 – 2022 will continue to grow from the gradual recognition of backlog,” Mr. Thanakorn said.
The rise of Q3/2019 performance also gave a boost to the nine-month performance, which recorded total revenue of 2.33 billion baht, rising 46% from 1.6 billion baht in the same period last year, and net profit of 342 million baht, surging 61% year-on-year from 213 million baht. The nine-month net profit margin was 15%. Contributing to the strong nine-month performance came from a 45% rise of property unit transfer to customers worth 2.03 billion baht, which mostly came from the condominium unit ownership transfer compared to 1.39 billion baht in the same period of 2018. The gross profit margin in the nine-month period stood at 36% and the net profit margin was 15%.
“Nine-month sales in 2019 was 6.5 billion baht, which contributed 90% of the full-year sales projection of 7 billion baht. The sales came from ongoing and newly-launched projects including The Excel Ladprao – Sutthisan project, The Vision Ladprao – Nawamin, and the Impression Ekamai, all of them got a warm response from buyers,”.
The CEO added that the fourth quarter will be the best quarter of 2019 as it is the peak season for property business and the government has imposed measures to reduce the 2% property transfer tax to 0.01% and the 1% mortgage registration fee to 0.01% for residential units with price not over 3 billion baht. And the Bank of Thailand’s Monetary Policy Committee cut its benchmark policy rate from 1.50% to a record low of 1.25% and the interest cut gives a boost to the property industry especially for those who pay monthly instalment for home loans. The interest rate reduction also helps stimulate consumer demand, which will become a positive factor to drive the property market in the last quarter of this year.
Meanwhile, ALL is confident in its business plan and strategy, which will grow total sales to reach 7 billion baht in 2019. Its revenue is expected to have a big growth as well.
Mr. Thanakorn said ALL has an in-dept business plan and vision to become a top-ten property leader in Thailand by developing property projects to serve customers in all aspects. It has diversified to invest in lease rights of The New Forum Plaza in Chonburi, which will be completed and opened for commercial in the second half of 2020. This project will increase recurring income about 200 million baht per year from 2021 and the lease contract is 29 years.
Besides, the company has plans to further expand the low rise projects including single detached house, duplex, and townhome. ALL has already developed the first townhome project, The Vision Ladprao – Nawamin, as it sees demand from low rise projects on a rise. ALL will revise its strategy to include various developments to serve extended target groups and in all aspects of living. At the same time, more condominium projects both low rise and high rise will be developed along the mass transit system.