(BANGKOK) Thai Asian Property Development has raised its revenue target for 2009 to 10 billion baht (S$424.4 million) from 8.5-9.0 billion baht thanks to an improvement in house sales, a senior executive said on Friday.
'The improving first-quarter results have made us feel more confident and we have raised our revenue target for this year to around 10 billion baht,' executive vice-president Pumipat Sinacharoen told Reuters.
Its first-quarter sales doubled to 2.8 billion baht and quarterly net profit trebled to 481 million baht due to strong condominium margins and lower taxes as the government extended lower property tax schemes for a second year to March 2010.
Asian Property now had 8.0-8.5 billion baht of presales, about half condominiums, which would be booked as revenue this year, enabling the company to reach the annual target, Mr Pumipat said.
Domestic political instability and the closure of two Bangkok airports by protesters hit confidence late last year, with a knock-on effect on housing demand in the fourth quarter, weakening home sales, while banks had tightened up on lending.
However, the domestic economic turmoil also had the effect of wiping out a number of small developers, thereby easing competition, lowering the supply of houses and increasing sales at remaining companies, including Asian Property, Mr Pumipat said.
The company's weekly sales and the number of site visits had increased in March and April, he said. Strong condominium margins would help the company keep its net profit margin this year at least at last year's 11.5 per cent, he added.
Asian Property, which builds town houses and condominiums in urban areas, is beefing up sales campaigns this year in an effort to attract home buyers and the company had previously said its net profit margin would fall short of last year's.
Fifteen analysts polled by Reuters Estimates forecast 2009 revenue of 8.6 billion baht, down 13 per cent, and a net profit for the year of 1.2 billion baht, down 29 per cent.
The company planned to launch 12 new projects this year, including six condominiums, worth a combined 18 billion baht in sale value, Mr Pumipat said. -- Reuters
Source: Business Times, 19 May 2009