WHA Group has reported its earnings for the first six months of 2022, achieving a normal profit of 992 million baht, an increase of 112.8%. The company signals that in Q3, it is set to sign contracts for an additional 600-700 rai of land sales and has announced its commitment to drive the business towards Net Zero by 2050.

WHA Corporation Public Company Limited or WHA Group announced its operational results for the first half of 2022, with total revenue and profit share amounting to 4,369 million baht and a net profit of 945.7 million baht. The normal total revenue and profit share stood at 4,403.4 million baht and a normal profit of 992 million baht, reflecting a 112.8% increase compared to the same period last year. The company indicated a bright outlook for the second half of the year, hinting at Q3 2022 where it is poised to sign contracts for additional land sales to major clients, totaling 600-700 rai, while negotiating the purchase of 2,000-3,000 rai of land. The logistics business remains strong, with nearly 100,000 square meters of new projects secured in the first half. Group CEO Jareeporn Jarukornsakul announced the goal of achieving Net Zero greenhouse gas emissions by 2050, aiming for sustainable growth in line with SBTi guidelines through the business operations of the group.

WHA Corporation Public Company Limited or WHA Group reported its Q2 2022 operational results with total revenue and profit share of 2,186.8 million baht and a net profit of 289.6 million baht, respectively. When considering normal operations, the company had total revenue and normal profit share of 2,238.9 million baht and a normal profit of 338.8 million baht, reflecting increases of 18.3% and 20.0% compared to the same quarter of 2021.

For the first half of 2022, the company reported total revenue and profit share of 4,369 million baht and a net profit of 945.7 million baht. In terms of normal operations, the company had total revenue and normal profit share of 4,403.4 million baht, an increase of 31.6%, and a normal profit of 992 million baht, up 112.8% from the same period last year, reflecting strong growth potential across all four business segments.

Ms. Jareeporn Jarukornsakul, Chairwoman and Group CEO of WHA Corporation Public Company Limited stated that the overall performance in the first half of 2022 has continuously improved, driven by the growth of all four business segments, aligning with the economic recovery as the COVID-19 pandemic situation begins to ease. This has led to a resurgence in both domestic and foreign investment, positively impacting WHA Group's overall business performance, reflecting the results of its four business segments.

The logistics business has shown outstanding operational growth, with the company signing lease agreements for Built-to-Suit projects and ready-made factories/warehouses totaling 111,136 square meters in the first half of 2022. Notably, in Q2, the company signed lease agreements for Built-to-Suit projects totaling 87,946 square meters with major clients, including e-commerce and logistics businesses.

Additionally, the company has short-term lease agreements yielding high returns totaling 96,071 square meters, achieving 96% of its short-term leasing target of 100,000 square meters for 2022. As a result, in the first half of the year, the company managed a total warehouse area of 2,683,502 square meters. The continuous demand for high-quality warehouse space has led to an occupancy rate of approximately 90% in Q2 and the first half of 2022, allowing the company to recognize rental income from real estate totaling 284.3 million baht and 512.8 million baht, respectively.

Given the strong performance of the logistics business in the first half, the company anticipates continued demand growth in the second half of the year, as it has signed lease agreements with new clients for both short-term and long-term leases, and is on track to deliver leased spaces to clients as planned. Although construction material costs have risen, the company has effectively managed costs and secured advance pricing agreements with contractors, mitigating any impact on construction costs and company expenses.

The industrial estate business has benefited from the country's reopening policies and travel restrictions being lifted, allowing foreign clients to easily visit and purchase land in the company's industrial estates. Recent major investors include clients from China and the United States across various industries, such as modern automotive, consumer goods, and data centers. This has resulted in strong growth in the first half of 2022, with total land sales of 513 rai, comprising 482 rai in Thailand and 31 rai in Vietnam, along with a total of 230 rai in MOU agreements, split between 48 rai in Thailand and 182 rai in Vietnam. In Q2 and the first half of 2022, the company recognized revenue from the industrial estate business totaling 704 million baht and 1,398 million baht, respectively. The improved land sales align with the overall economic recovery and investment climate in Thailand.

Currently, the company is expanding and constructing new industrial estates, including the WHA Rayong Industrial Estate 36, covering 1,281 rai in the Eastern Economic Corridor (EEC), as well as plans to expand WHA Eastern Seaboard Industrial Estate Phase 2 by an additional 580 rai and WHA Rayong Industrial Estate Phase 1 by 1,100 rai. This will increase the available land for sale and meet future demand for industrial estate land. Additionally, government incentives for electric vehicle investments, subsidies, and tax reductions to promote the transition to electric vehicles, along with policies for zero-emission vehicles, will significantly support automotive operators in increasing investments or using Thailand as a base for electric vehicle production, positively impacting the industrial estate business, as the company has over 30% of its clients in the automotive sector.

The company also assesses that the overall industrial estate business in the second half of the year will outperform the first half, with sales expected to exceed the same period last year due to positive psychological factors following the increasingly tense relations between the U.S., China, and Taiwan, driving production relocations to Southeast Asia. Recently, the company has received numerous inquiries from foreign investors wishing to visit the estates for investment purposes. It is anticipated that in Q3 2022, the company will sign additional land sale contracts for over 600-700 rai with major clients, which will increase the backlog of land sales to over 1,000 rai, with some expected to be delivered and recognized as revenue within the remaining time of this year. Furthermore, the company is in negotiations with several investors seeking a total of over 2,000-3,000 rai of land.

In terms of the industrial estate business in Vietnam, during the first half of 2022, the company recorded land sales of 31 rai and a total of 182 rai in MOU agreements, reflecting supportive factors from the macroeconomic environment and improved investment conditions in Vietnam following the reopening of the country. There is significant potential for growth due to the increase in GDP and FDI in Vietnam. The WHA Industrial Zone in Nghe An has received positive responses from investors, with continuous inquiries, prompting the company to accelerate the development of Phase 2 on over 2,200 rai, which began construction earlier this year. Once completed, the total area of both Phase 1, Phase 2, and the expansion of the WHA Industrial Zone in Nghe An will exceed 11,550 rai.

Moreover, the economic and social growth in Vietnam has led to a high demand for land within quality industrial zones, prompting the company to accelerate the development of new industrial zones in Thanh Hoa province.

The utilities business (water) continues to grow, with the company recognizing total revenue from utilities in Q2 and the first half of 2022 amounting to 663.2 million baht and 1,285.2 million baht, reflecting increases of 11.3% and 8.7% from the same period last year. The company managed a total water sales volume of 39.4 million cubic meters and 75.1 million cubic meters for Q2 and the first half of 2022, respectively, with domestic water sales volumes of 32.4 million cubic meters and 62.3 million cubic meters, showing improvements across all product categories, reflecting increased water demand from petrochemical and power plant clients, particularly Gulf SRC, which has gradually commenced additional commercial operations.

In Vietnam, the Duong River Surface Water Plant (SDWTP) recorded water sales of 6.7 million cubic meters and 12.2 million cubic meters in Q2 and the first half of 2022, respectively, reflecting increased demand from both existing and new clients, as well as the easing of COVID-19 situations in Hanoi.

Additionally, the company has recorded sales volumes of value-added water products of 1.3 million cubic meters and 2.5 million cubic meters in Q2 and the first half of 2022, respectively. Committed to developing and launching new projects to meet customer demands, the company has signed a sales contract with Gulf SRC for the commercial operation of production units 3 and 4 in Q3 2022, resulting in an additional demand for over 1.4 million cubic meters of water per year, alongside expanding its customer base for conventional water products, including raw water and general industrial water. The company also emphasizes value-added products such as demineralized water and premium clarified water derived from wastewater recycling processes to support environmental preservation and sustainable development.

For its growth plans outside industrial estates, last year, the company signed a cooperation agreement with an industrial estate in Asia to establish a joint venture for the production and sale of value-added water products to clients in the industrial estate. The first phase has a production capacity of approximately 1 million cubic meters per year, currently under construction and expected to commence commercial operations in Q4 2022.

In addition to increasing water sales, the company is investing in alternative raw water sources, such as constructing additional reservoirs to reduce reliance on primary raw water suppliers and lower raw water procurement costs, aiming to increase the production capacity of alternative raw water sources by at least 11 million cubic meters per year.

In Vietnam, the company continues to expand investments in developing utilities systems in the WHA Industrial Zone in Nghe An Phase 2, which began construction in Q1 2022 after the completion of Phase 1, ready to serve clients in the industrial zone to meet the continuously increasing demand, similar to the SDWTP and Cua Lo water projects, which will involve additional investments in pipeline laying to expand services to clients.

In the electricity business, the company recognized normal profit shares from investments in joint ventures and associates, excluding accounting gains/losses from exchange rates and revenue from solar energy operations in Q2 and the first half of 2022, amounting to 290.7 million baht and 383.4 million baht, respectively. In Q2 2022, the normal profit share from the electricity business decreased compared to the previous year but improved significantly from the previous quarter due to increased normal profit shares from the GHECO-One power plant, which had fewer maintenance shutdown days, and increased normal profit shares from SPP power plants due to the gradual increase in Ft rates starting in May, partially mitigating the negative impact of rising natural gas costs. It is expected that natural gas costs will continue to rise in the second half of the year, and if Ft rates are adjusted as announced by the Energy Regulatory Commission, it will reflect the higher costs and help reduce negative factors affecting sales to industrial clients of SPP power plants, which were evident earlier this year.

For the solar energy business, in Q2 2022, the company signed 13 new rooftop solar project contracts, comprising 10 Private PPA projects with a total capacity of approximately 21 megawatts and 3 EPC service projects with a total capacity of approximately 3 megawatts. As of Q2 2022, the company has accumulated 125 megawatts of Private PPA project contracts and has commenced commercial operations (COD) to produce and sell solar energy to clients for an additional 2 megawatts, bringing the total commercial capacity of solar projects to 62 megawatts. In the first half of 2022, the company had a total electricity production capacity of 612 megawatts.

Recently, the company signed a contract to install a solar power system on the parking lot (Solar Carpark) for Ford Motor Company, with a capacity of 7.7 megawatts on a total roof area of 59,000 square meters, making it the largest Solar Carpark project in Thailand, with an investment value of 235 million baht. The project has already begun installation and is expected to be completed in 2023.

Furthermore, the company continues to prepare for the future of the solar energy business through the development of various technologies, such as an intelligent energy platform in collaboration with business partners, including PTT Public Company Limited and Sertis Company Limited, to develop a Peer-to-Peer Energy Trading Platform named “RENEX” for trading solar energy among clients within WHA's industrial estates. This involves applying key technologies such as Blockchain to enhance transaction security and facilitate energy trading among operators in the industrial estates. “RENEX” has been included as part of the ERC Sandbox, an energy innovation trial project by the Energy Regulatory Commission, which is currently preparing for commercial trading trials expected to commence in Q3 2022. Once developed, this electricity trading system is anticipated to significantly boost the company's renewable energy portfolio, with over 23 operators participating as Clean Energy Traders in the pilot project.

The digital platform business continues to support investors looking to integrate 5G technology into their businesses and enhance their competitive capabilities, alongside the installation of fiber optic cable networks (FTTx) across all 11 of the company's industrial estates by the end of this year. The company is preparing to face new challenges with its 'innovation and digital transformation' strategy, as well as expanding its customer base and continuously introducing new products and services, such as the launch of the WHAbit application in collaboration with Samitivej Virtual Hospital to provide telemedicine consultations, health check-ups, and smart clinics for all employees and clients in the industrial estates, logistics centers, and office buildings.

Additionally, the company supported the World RoboCup 2022 competition held in July, promoting skills in robotics and artificial intelligence among the younger generation, reinforcing WHA Group's commitment to advancing research in robotics and AI, as well as supporting the development of IT skills to create innovative solutions that enhance productivity and safety across all sectors.

The Group CEO also emphasized that the company plans to continue investing and expanding collaborations with startups. Recently, WHA Venture Holding Company Limited (WHAVH) invested in Mercular, a Thai vertical e-commerce startup developing a Hobby Lifestyle and Community Commerce platform for specialized products such as headphones, speakers, gaming gear, desks, and hobby equipment. This investment will enable Mercular to integrate the e-commerce business value chain with WHA Group's comprehensive logistics ecosystem, including premium warehouses and distribution centers, as well as providing a channel for the company and WHA Group to expand its customer base to the younger generation and increase its role in the B2C business. Additionally, it will enhance collaboration in efficient transportation through Giztix, a leading e-logistics startup that the company invested in recently, specializing in last-mile delivery services.

Moreover, the company remains committed to developing products and services that meet customer needs in a changing competitive environment. It has launched WHA Office Solutions, a rental office building in various locations across Bangkok and Samut Prakan, to cater to corporate clients seeking flexible workspaces, such as the WHA Tower, a 25-story office building with 52,000 square meters of rental space located in the Bangna-Trad area, currently with an occupancy rate of approximately 50%, and clients are gradually signing additional lease agreements. The WHA KW project, a low-rise office building covering 9,900 square meters located at the corner of Sukhumvit Soi 25, connects to major BTS lines, is currently under construction, and is expected to be completed by Q2 2023.

Regarding plans to sell assets and/or lease rights to trusts in 2022, the WHART and WHAIR trust unit holders have recently approved additional asset investments. The company aims to sell assets totaling approximately 208,149 square meters, valued at around 5,397 million baht, with expected revenue recognition in Q4 2022 as planned. Meanwhile, the WHART trust has been selected by the Thai Institute of Development to be one of the ESG100 securities for the fourth consecutive year due to its outstanding performance in environmental, social, and governance (ESG) aspects for 2022, which guarantees its commitment and reinforces WHART as the industrial trust with the highest asset value in Thailand (as of March 31, 2022).

The Group CEO concluded by stating that the company is committed to conducting business while creating sustainable growth alongside all stakeholders, emphasizing the importance of environmental, social, and governance aspects. The company is dedicated to addressing climate change by reducing negative impacts, lowering greenhouse gas emissions, and building essential infrastructure, such as promoting renewable energy use and leveraging existing technologies while studying various innovations and technologies to sustainably address climate change throughout the company's value chain, aiming for net-zero greenhouse gas emissions by 2050 in accordance with SBTi guidelines, aligning with global and Thailand's direction in addressing climate change.