Noble budgets Bt10 bn for 4 projects

"Our capital-expenditure budget will come from our cash flow, project loans from the bank and the issuance of debentures worth Bt1.5 billion in the third quarter of 2013," Kitti Thanakitamnuay, chairman and chief executive officer, said yesterday.

Noble Ploenchit’s environmental impact assessment has already been approved and construction will commence next year.

The three other residential projects are valued at Bt7 billion, but about Bt4 billion from the capex budget will be spent on constructing the infrastructure and improvements.

About Bt2 billion from the budget will be used to buy land to develop projects in 2014.

The company aims to boost its presales to Bt7 billion next year, but its revenue will be nearly the same as this year because most of the new residential projects are condominiums that take two to three years to generate revenue. Revenue this year is pegged at Bt2.7 billion.

Presales in the first nine months reached nearly Bt2 billion, on track to achieve the target of Bt3 billion for the full year.

Noble earned Bt92.52 million on revenue of Bt1.32 billion in the first nine months.

The company has enough cash to develop all of its new residential projects by controlling its debt-to-equity ratio at no more than 2.2 times. Currently, its D/E ratio is 1.3, giving it room to take out a project loan from the bank.

The company held the news conference yesterday after its managing director Thongchai Busaraphan resigned last month.

Kitti said he would take over Thongchai’s work. No new managing director will be appointed. Noble Development will continue to market aggressively and develop condo projects according to its business plan.

"Our strategy will focus on high-rise residences in central business districts rather than low-rises," he said.

The three new condo projects worth Bt7 billion will be in the Bangkok business districts of Ratchadaphisek, Thong Lor and Sukhumvit, with a focus on the middle-to-upper-income market.

The company has a Bt12-billion backlog of units that have been sold but are awaiting construction to be completed so that they can be delivered to customers over 2013-16, of which Bt2.2 billion worth will be transferred in the first year.

The company also has finished inventory worth Bt12 billion that will generate income over 2013-16.

Noble is now studying expanding upcountry, especially to provinces close to neighbouring countries such as Udon Thani, Khon Kaen and Ubon Ratchathani, to serve expected demand for housing when the Asean Economic Community goes into effect in 2015, Kitti said.