First quarter sees poorer results for property sector, but presales looking good
MOST OF the top 10 SET-listed property firms reported lower revenue and net profit in the first quarter compared with the same period last year, but their presales grew by as much as 14 per cent, attributed to an improving economy.
“We are confident the overall property market will grow strongly, by up to 10 per cent this year, in terms of presale value,” Pruksa Holding chief executive officer Thongma Vijitpongpun told a news conference yesterday.
“We are also confident of posting revenue of Bt57.9 billion this year, although our revenue in the first quarter was only Bt8.07 billion, down 21.5 per cent from the same period last year, and net profit Bt681 million, down 45.1 per cent, because we have a backlog worth Bt13 billion that will transfer this year.”
Pruksa posted presales worth Bt13.3 billion in the first quarter, up 35.6 per cent from the same period last year. Meanwhile the overall property market in metropolitan Bangkok recorded presale value of Bt97.47 billion, up 13.6 per cent, Thongma said.
Ananda Development announced that its presales of Bt4.43 billion in the first quarter were up by 11 per cent year on year. As a result, the company has raised its second-quarter presale target to Bt22.67 billion from the early estimate of Bt6.02 billion although its revenue and net profit in the first quarter were below target.
Several property companies said the reason their first-quarter financial results were lower than in the same period last year was that in early 2016, government stimulus measures were in place. These measures, which reduced transfer and mortgage fees significantly, expired on April 28 last year.
Meanwhile, the number of condominium units being transferred to customers this year is likely to be lower than in 2016, because of a relatively small number of new condo-project launches in 2014, a year of political upheaval. Most of the condominium projects launched in 2014 will transfer to their customers this year, said Prasert Taedullayasatit, Pruksa Real Estate CEO for premium business.
Prasert is also president of |the Thai Condominium Association.
Another factor having an impact on financial results in the property sector is the tightening of mortgage approvals by the commercial banks, LPN Development managing director Opas Sripayak said in a report to the Stock Exchange of Thailand recently.
However, AP (Thailand) and Golden Land Property Development have reported stronger year-on-year financial results in the first quarter.
Golden Land president Thanapol Sirithanachai reported to the SET recently that the company did well in the quarter thanks to three new projects it launch early this year, compared with only one project in the first quarter of last year.
AP (Thailand) reported to the SET that its good first-quarter results were due to continued sales momentum for its detached houses. Its joint-venture projects with Japanese firm Mitsubishi Estate Group launched two years ago were transferred to customers in the first quarter of this year, which boosted its quarterly revenue.