In Q2/2017, Italian-Thai Development (ITD) achieved the highest revenue in the group at 25.7 billion baht. Meanwhile, Prebuilt (PREB) recorded revenue during the second quarter along with income from the sale of investments in Built Land Public Company Limited amounting to approximately 288 million baht, resulting in a net profit margin of 22.83%. The earnings per share stood at 1.69 baht, with ROE at 54.64% and ROA at 23.49%, marking the highest in the group. In terms of capital projects, Powerline Engineering (PLE) exhibited the highest risk with a debt-to-equity (D/E) ratio of 5.75, the highest among contractors. Currently, pile foundation companies like Seafco (SEAFCO) and Pylon (PYLON) are attracting special interest from investors due to future expectations that need to be monitored closely.

          

TerraBKK Research summarizes the figures of Q2 2017 performance of the “Contractor” group consisting of 19 companies, including revenue, profitability metrics such as net profit margin, earnings per share, return on equity, return on assets, etc. Debt levels such as debt-to-equity ratios, and evaluations of price levels using P/E ratios are detailed below.

Revenue

      • The average revenue for Q2 2017 mostly ranged in the billion baht level.
      • The highest revenues of over ten billion baht were Italian-Thai Development (ITD) at 25.7 billion baht and Ch. Karnchang (CK) at 21.3 billion baht.
      • The companies with the highest revenue growth compared to the same period last year were Sriracha Construction (SRICHA) at 82%, Thai Polycons (TPOLY) at 45%, and Sahakol Equipment (SQ) at 42%.
      • The companies with the largest revenue declines compared to the same period last year were STP & I (STPI) at -90%, BJC Heavy Industry (BJCHI) at -81%, and EMC (EMC) at -41%.

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Net Profit Margin (NPM)

      • The average net profit margin for Q2 2017 ranged from 0.35% to 8.95%.
      • The top three highest net profit margins were Prebuilt (PREB) at 22.83%, Sahakol Equipment (SQ) at 20.16%, and Pylon (PYLON) at 16.93%.
      • The highest growth in net profit margin compared to the same period last year was Thai Polycons (TPOLY) at 5.5% (Q2/2017) from 1.16% (Q2/2016).
      • The largest decline in net profit margin compared to the same period last year was STP & I (STPI) at -278.41% (Q2/2017) from 14.6% (Q2/2016).

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Earnings per Share (EPS)

      • The top three earnings per share were Prebuilt (PREB) at 1.69 baht per share, Ch. Karnchang (CK) at 0.57 baht per share, and Uniq Engineering and Construction (UNIQ) at 0.39 baht per share.

Return on Equity (ROE)

      • The average ROE for Q2 2017 ranged from 3.8% to 21.5%.
      • The top three ROE were Prebuilt (PREB) at 54.64%, Sahakol Equipment (SQ) at 33.39%, and Powerline Engineering (PLE) at 24.79%, reflecting strong management capabilities in delivering returns to shareholders.
      • The highest growth in ROE compared to the same period last year was Thai Polycons (TPOLY) at 16.44% (Q2/2017) from -17.95% (Q2/2016).
      • The largest decline in ROE compared to the same period last year was STP & I (STPI) at -21.19% (Q2/2017) from 26.2% (Q2/2016).

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Return on Assets (ROA)

      • The average ROA for Q2 2017 ranged from 3.3% to 11.3%.
      • The top three ROA were Prebuilt (PREB) at 23.49%, Pylon (PYLON) at 19.68%, and Sahakol Equipment (SQ) at 14.64%, reflecting the companies' efficiency in utilizing assets for returns.
      • The highest growth in ROA compared to the same period last year was Nawarat Patanakarn (NWR) at 2.36% (Q2/2017) from 0.01% (Q2/2016).
      • The largest decline in ROA compared to the same period last year was STP & I (STPI) at -16.8% (Q2/2017) from 25.62% (Q2/2016).

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Debt to Equity (D/E)

      • The average D/E ratio for Q2 2017 ranged from 0.6 to 2.7.
      • The top three D/E ratios were Powerline Engineering (PLE) at 5.75, Italian-Thai Development (ITD) at 5.29, and TTCEL (TTCL) at 4.16, indicating poor management of capital structure risk.

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P/E Ratio (as of August 23, 2017)

      • The average P/E ratio for the contractor group ranged from 6.23 to 30.22.
      • The three highest abnormal P/E ratios were Sriracha Construction (SRICHA) at 225, Italian-Thai Development (ITD) at 150, and Nawarat Patanakarn (NWR) at 90, indicating that these stocks are very expensive compared to others in the group.

In conclusion, Terra research summarizes the performance data for Q2 2017 of the “Contractor” group consisting of 19 companies as follows: ---TerraBKK

 

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Article by: TerraBKK Investment Tips
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