For the 9M/60 performance of the “Contractor Group,” TerraBKK Research observed changes in revenue for 9M/60, both increases and decreases. The contractor company with the highest revenue increase from 9M/59 is Thai Polycons (TPOLY), which grew by 39% compared to the same period last year (9M/60 = 2,545.53 million THB, 9M/59 = 1,830.78 million THB). The main revenue comes from construction contracting, and they still have a backlog of projects to recognize revenue until 2019, as well as income from real estate sales in the third quarter, such as Greenwich Prime, and revenue from two new power plant projects that have started commercial electricity sales. Another contractor company with relatively good revenue figures is Powerline Engineering (PLE), which grew by 33.9% compared to the same period last year (9M/60 = 4,886.24 million THB, 9M/59 = 3,648.63 million THB), all from construction contracting.

Regarding contractor companies with concerning performance due to 9M/60 revenue levels decreasing from 9M/59, the worst in the industry, TerraBKK Research identified STP and I (STPI) with a 90% decrease compared to the same period last year (9M/60 = 952.55 million THB, 9M/59 = 9,590.54 million THB), and BJC Heavy Industry (BJCHI) with a 73.6% decrease compared to the same period last year (9M/60 = 1,195.62 million THB, 9M/59 = 4,531.3 million THB). The main reasons are similar, stemming from a decrease in the volume of work and revenue recognition for 9M/60, as they had previously delivered their main project work to clients.


Regarding net profit figures, TerraBKK Research found three real estate companies with interesting performance that showed continuous growth in net profit both annually (net profit for 2016 higher than 2015) and for the 9-month period (net profit for 9M/60 higher than 9M/59). Currently, the standout is Italian-Thai Development (ITD), which returned to positive net profit for 9M/60, mainly due to progress on major projects such as the Suvarnabhumi Airport construction for the second passenger terminal, the Orange Line electric train contract 3, and the Krungsri Ploenchit Tower project, among others. Additionally, Sahakol Equipment (SQ) had a net profit for 9M/60 exceeding the total net profit for 2016 by over 26.3 million THB, primarily from the Mae Moh 8 earthworks project, and Thai Polycons (TPOLY) also had a net profit for 9M/60 slightly exceeding the total net profit for 2016 by 13.7 million THB.

For contractor companies with the lowest net profit for 9M/60, the top three are STP and I (STPI) -2,324.06 million THB (9M/59 = 1,270.04 million THB), EMC -663.32 million THB (9M/59 = -113.53 million THB), and BJC Heavy Industry (BJCHI) -329.06 million THB (9M/59 = 332.42 million THB). The main reasons are a decrease in work volume and losses from exchange rates.



For the important financial ratios for 9M/60, such as net profit margin, earnings per share, return on equity, return on assets, debt to equity, etc., TerraBKK Research compiled the 9M/60 performance of the “Contractor” group from over 19 companies, with details as follows:

1. Earnings per Share (EPS)
Generally, TerraBKK Research found that this industry group has earnings per share not exceeding 1 THB/share, with only one contractor company having outstanding earnings per share above the average, which is Prebuilt (PREB) at 1.97 THB per share.

2. Net Profit Margin (NPM)
The average net profit margin for 9M/60 is between 1% - 8.5%. The top three companies with the highest net profit margin are Prebuilt (PREB) 17.15%, Pylon (PYLON) 14.38%, and Sahakol Equipment (SQ) 13.97%.

3. Return on Equity (ROE)
The average ROE for 9M/60 is between 1% - 18.2%. The top three companies with the highest return on equity are Prebuilt (PREB) 47.86%, Sahakol Equipment (SQ) 30.46%, and Syntec Construction (SYNTEC) 21.01%, reflecting their ability to manage operations to provide good returns to shareholders.


4. Return on Assets (ROA)
The average ROA for 9M/60 is between 1.5% - 10.5%. The top three companies with the highest return on assets are Prebuilt (PREB) 20.35%, Pylon (PYLON) 14.98%, and Seafco (SEAFCO) 12.86%, reflecting the companies' efficiency in utilizing assets to generate returns.

5. Debt to Equity (D/E)
The average D/E ratio for 9M/60 is between 0.7 – 2.6 times. The companies with the highest debt to equity ratios are Powerline Engineering (PLE) 6.29 times, Italian-Thai Development (ITD) 5.44 times, and TTCL 4.32 times, reflecting poor capital structure management and high financial risk.

TerraBKK Research concludes the 9M/60 performance of the “Contractor Group” as follows: Italian-Thai Development (ITD) achieved the highest revenue of 40.1 billion THB, while the highest net profit belongs to Ch. Karnchang (CK) at 1.59 billion THB. The contractor company with the best financial ratios is Prebuilt (PREB), with the best four figures in the group: earnings per share (EPS) 1.97 THB, ROE 47.9%, ROA 20.4%, and net profit margin 17.15%. Meanwhile, Powerline Engineering (PLE) has the highest financial risk due to a debt to equity (D/E) ratio of 6.29 times, which is unusually high for the group ---TerraBKK.

Article by: TerraBKK Investment Tips
TerraBKK: Finding good, valuable, and affordable homes