Amata Corporation

Amata Corporation Plc (AMATA)
 

Profit in line with model: AMATA reported a 4Q11 net profit of Bt479m, up a robust of 184% YoY and 176% QoQ on record land transfers of 450 rai during the quarter (from only 95 rai in 3Q11). The result was in line with our estimate but 50% ahead of the consensus.
Result highlights: Revenue rose by 43% YoY and 140% QoQ to Bt1.57bn, underpinned by Bt1.25bn in land transfers. Gross margin expanded to 52.5% from 43.8% in 3Q11 due to a bigger contribution from land sales and fatter land margin—59.6% in 4Q11, up from 55.8% the previous quarter—thanks to higher land prices.
Outlook: Earnings growth momentum should be sustained for the next couple of quarters, thanks to a large backlog on-hand of Bt3.7bn (around 70% of which is expected to transfer this year) and a bright land sales outlook. FY12 looks set to be the best year yet for AMATA, based on management guidance of FY12 land sales of 2,000 rai (a number likely to be upgraded again at the Opportunity Day this afternoon).
What's changed? We have revised up our land sales assumption for FY12 to 1,800 rai from 800 rai. As a result, our FY12-13 earnings forecasts rise by 4% and 33%, respectively. We have also increased our YE12 target price to Bt19.80 from Bt10.60.
Recommendation: The positive new flows should continue. We have upgraded our rating to BUY from SELL.