WHA Group posts Normal Profit Q3/21 THB 228.5 mm

• Quarantine-Free Thailand Reopening for vaccinated visitors
• Interim Dividend Announcement
• Confirmed Asset Sale to WHART in Q4

Bangkok/ 12^th November 2021 – WHA Corporation Public Company Limited, or WHA Group, announced its Q3/2021 result with total revenue and share of profits of THB 1,445.9 million, and a net profit of THB 160.3 million. Total normalized revenue and share of profits reached THB 1,512.4 million and normalized profits amounted to THB 228.5 million. Highly confident on the robustness of WHA group’s 4 business hubs, Chairman and Group CEO, Ms Jareeporn Jarukornsakul cited Q4/2021 will show the highest performance, driven by asset sale to WHART and positive investment outlook due to Thailand Reopening policy. Its logistics business continues to grow in-line with demand for premium warehouse facilities while energy crisis causes investors to urge to relocate to Thailand and Vietnam. Utilities and power business experiences rising demand for both water and solar. TRIS Rating affirming “A-” rating with upgrade “stable” outlook, the Board of Directors has approved the interim dividend payment of THB 0.0267 per share, with the XD sign posted on 25 November 2021 and will pay the dividend on 9 December 2021.

WHA Corporation Public Company Limited, or WHA Group, reported its Q3/2021 results with total revenue and share of profits of THB 1,445.9 million, and a net profit of THB 160.3 million, a decrease of 10.3% and 62.6% from the previous quarter. Total normalized revenue and share of profits reached THB 1,512.4 million and normalized profits amounted to THB 228.5 million, a decrease of 6.0% and 47.7% respectively. For the first 9 months of 2021, the company recorded total revenue and share of profits of THB 4,724.7 million, and a net profit of THB 555.2 million, a decrease of 2.7% and 48.1% from the first 9 months of 2020. The company also realized total normalized revenue and share of profits equal to THB 4,859.2 million and normalized profits THB 694.8 million, a decrease of 0.7% and 37.6% from the same period of last year.

As the operating result and outlook in Q4 contemplated the strength of the company’s financial status and the strong performance of the 4 business hubs, recently, the Board of Directors has approved the interim dividend payment of THB 0.0267 per share, with the XD (Excluding Dividend) sign posted on 25 November 2021 and will pay the dividend on 9 December 2021. This also corresponded with the company’s rating at “A-” with upgrade “stable” outlook by TRIS Rating, reflecting the company's stable revenue structure, as well as the financial flexibility and efficiency in financial management amidst Covid pandemic.

Ms Jareeporn Jarukornsakul, Chairman of the Board of Directors and Group Chief Executive Officer of WHA Corporation PCL., revealed the operating results of the company’s four businesses during the first nine months of 2021. The logistics business grew in line with the demand for premium distribution centers and high-quality warehouses. For Q3 and the first nine months of 2021, the company recognized revenue from property rental business equal to THB 301.5 million and THB 863.0 million, an increase of 5.1% and 0.9% from the same period of last year. As a result of COVID-19 pandemic and recent global supply chain chaos, the company has signed short-term lease contracts of over 120,000 sq.m., substantially higher than the original target. Moreover, during Q3/2021 the company has added new contract of 33,928 sq.m. to its Built-to-Suit and ready-built factory and warehouse portfolio as well as handover its Built-to-Suit project with total area of 8,151 sq.m. located at WHA Eastern Seaboard Industrial Estate 2 to Signode, the leading manufacturer of a broad spectrum of transit packaging consumables.

As for plans to divest assets and/ or leasehold rights to REIT in 2021, the company will sell 3 projects for total area of 184,329 sq.m. with value of not over THB 5,500 million to WHART. All projects are situated in strategic location of Thailand’s logistics route with leading tenants in E-Commerce and FMCG sectors including “Alibaba Group – Shopee Xpress - TD Tawandang”. The company expected to be able to recognize revenue within Q4/2021 as planned.

The Company is also speeding up new product and service offerings through smart technology as well as to develop innovative business model and penetrate new customer groups via partnership. Recently, it has acquired a 29.40% stake in Storage Asia Co., Ltd. a leading premium self-storage solution. The new acquisition is in line with WHA Group’s strategy to embrace new market opportunities through meaningful investments and create new value for its customers and industry as a whole. Several new initiatives are expected to be rolled out from next year onwards.

Industrial Estate Business - The company recorded land transfer revenue in Q3/2021 and the first nine months of 2021 at total THB 135.0 million and THB 826.8 million, declining from the same period of last year, due to lower revenue from right of way compensation in 2021. However, the industrial land business still demonstrates a robust fundamental as during the first nine month of 2021, the company achieved total land sales of 285 rai (248 rai in Thailand / 37 rai in Vietnam) and signed MoUs for 85 rai in Vietnam, improving from the same period of last year. Thanks to the strong second half of 2021 that started to show positive momentum of Thailand’s investment and FDI situations with country reopening, lockdowns eased and more COVID relief due to effective vaccine distribution, the company has already received more enquiries from foreign investors than the previous year. Furthermore, the current energy crisis and increasing electricity price in China due to state intervention for clean/ renewable energy policy have become an accelerating force that drives investors to relocate their production facility out of China. Following China Plus One strategy, leading manufacturers are diversifying and expressing strong interest to move to Thailand and Vietnam. Based on current estimation, the company is confident that it will be able to achieve or even exceed its domestic land sale target at 750 rai.

WHA group currently operates 11 industrial estates in Thailand. The Company plans to develop three more industrial estates including WHA Eastern Seaboard Industrial Estate 3 (WHA ESIE 3) and WHA Rayong 36 (WHA RY 36) which are expected to be fully completed by year end. Following EIA approvals, construction of the expansion phase of WHA Eastern Seaboard Industrial Estate 4 (WHA ESIE 4) is scheduled to start in Q4 2021. Approved as a Special Economic Zone (SEZ) by the EEC, construction of WHA IER is expected to start in Q4 2022.

In Vietnam, the company recorded total Q3 land sales of 37 rai and MoUs of 85 rai slightly decreases from the same period of last year due to COVID-19 lockdown that impacts the handover process of raw land. However, as Southeast Asia’s shining star, Vietnam is still highly attractive for long-term economic growth. With WHA Industrial Zone 1- Nghe An completed construction of the 1,000-rai Phase 1, with 54% already leased to customers, the company has accelerated the construction of the remaining 2,100 rai that is expected to start in Q1/2022. In addition, WHAID is currently developing two more industrial zones - WHA Smart Technology Industrial Zone and WHA Northern Industrial Zone - in Thanh Hoa Province, covering a total area of over 7,500 rai. Construction is scheduled to commence at the end of 2023 and 2024.

Utilities Business - The Group CEO declared that the performance of water business in Q3 was excellent. Total water sales and management in Thailand and Vietnam during the third quarter and the first nine months of 2021 have reached 35 million cubic meters and 103 million cubic meters, an increase by 25% and 20%. The company recognized total revenue from utilities business at THB 588.6 and THB 1,770.7 million respectively. Domestic water sales volume showed solid growth in all product categories as the company achieved domestic sale a total of 29 million cubic meters and 86 million cubic meters, an increase by 27% and 20% from the same of period last year. This growth reflects rising water demand from both existing industrial customers who not affected by the third COVID-19 wave and groups of new customers including petrochemical sector (GC Oxirane), who inaugurated its commercial operations late last year and power plant (Gulf SRC) whose Phase 1 alone already consumes approximately 12,500 cubic meters per day while Phase 2 is expected to commercialize within Q4/2021. The value-added water product sales also experienced a sharp increase in volume as the company recorded total sale in the third quarter and the first nine months of 2021 at 1.2 million cubic meters and 3.3 million cubic meters, an increase by 29% and 94% from the same period of last year.

During the same period, water sales in Vietnam reached 5.9 million cubic meters and 16.4 million cubic meters respectively, a rise of 15% and 21% corresponding with an increase in demand for quality water in Hanoi and nearby cities of Bac Ninh and Hung Yen. Meanwhile, Cua Lo Water Supply Co, the producer and distributor of tap water that the company owns 47% stake has already expanded of its production capacity to 8.4 million cubic meters per year and in the process to extend its water supply network, which is scheduled to complete in late 2022 to cover more serviced area as WHA group continue to expand in Nghe An province.

In addition, the company has developed and introduced new products such as demineralized water and premium clarified water, and innovative solutions such as wastewater reclamation to its various industrial customers. Presently, there are several projects under construction including the wastewater treatment plant in WHA Rayong 36 Industrial Estate, with a capacity of 2.7 million cubic meters per year, the demineralized water plant with a capacity of 1 million cubic meters per year, and the alternative source of raw water project with a capacity of 6 million cubic meters per year.

For power business, during Q3 and the first nine months of 2021, the company recorded share of normalized operating profit from investment in subsidiaries and joint ventures, excluding profit and loss from foreign exchange, equal to THB 292.0 million and THB 900.9 million, an increase of 13.5% and 16.2% from the same period last year. While revenue from solar business continues to grow strongly in conjunction with hefty contribution from SPP business, the IPP records lower than expected share of profits. This was due to the shutdown of Gheco-One for planned maintenance for 37 days in Q1 and unplanned maintenance for 48 days in Q2 and Q3. However, after maintenance works were completed, the power plant has resumed normal operations.

In Q3, the company signed new solar rooftop contract for 22 MW, bringing the total outstanding signed solar PPA portfolio to 85 MW. Contributing to this extraordinary success, the company has secured a solar contract of 19 MW, the company’s biggest solar rooftop contract ever, with “Prinx Chengshan tire”, the leading Chinese tire manufacturer. At-present, the company also has several solar deals under negotiation and therefore, it is highly confident that it will be able to achieve this year target of signed PPA at 90 MW. Besides, projects which already started COD, have generated an additional 4 MW of electricity, bringing total solar capacity which already COD to 50 MW and the total COD equity MW to 600 MW.

Digital platform business - The company continues to support its customers and manufacturers who aspire to transform their business with 5G. With superior technology for higher multi-Gbps peak data speeds, ultra-low latency, and massive network capacity, 5G will offer unprecedent use cases and truly improve long-term competitiveness of industrial sectors. The company has presently co-developed/ invested in 5G towers with leading telecom operators while WHA Digital continues to carry out its plan to offer fiber optics (FTTx) in WHA group operating industrial estates in Thailand.

Coping with uncertainty in the 21st Century, WHA group has emphasized on its Digital Innovation and Transformation strategy that focuses on both the adoption of innovative/ digital technology for product and service offerings and the transformation of its people and culture through effective change management program. By transforming systems, organization, work process, and overall business management ranging from thinking, design, customer experience, resource management all together, the company shall one step ahead of the competition and be able to respond to rapid market environment. This will drive long-term business sustainability by enabling the company to grab new opportunities in the future

This year, WHA Group was granted “Rising Star Sustainability Award” in Sustainability Excellence category of SET Awards 2021. In addition, the company has been listed in the 2021 Thailand Sustainability Investment (THSI), for second consecutive year. The award underscores the company’s determination to consistently develop and enhance operational practice in aspects of environment, social and governance aligning to sustainable development principles which will strengthen the company’s foundation as well as potential and capability enabling to stable and sustainable growth over the long run. This includes the ability to effectively manage the crisis during Covid-19 epidemic along with supports given to social sector from community to the national level, through the establishment of 2 field-hospital that are equipped with medical system to treat and monitor symptoms of Covid-19 patients.

In addition, WHA Utilities and Power Public Company Limited (WHAUP), a subsidiary of WHA Group, received the “Outstanding Innovative Company Award” for its innovative “Demineralized Reclaimed Water” project. WHAUP was also selected by the SET as a "Sustainable Stocks" company and remained in the 2021 Thailand Sustainability Investment (THSI) list for the second year straight. The award reflects the company’s sound practices for sustainable business growth, and its commitment to create value for stakeholders, society and the environment.

Moreover, the company is also aware of the effects of human-caused global warming by setting target to reduce greenhouse gas emissions through installation of solar power for customers both inside and outside our industrial estates. In addition, the company is also committed to conducting business with transparency in accordance with good corporate governance principles and international practice standards in parallel with balancing the development of society and the environment aspects, and drive new innovative projects to improve quality of Thai people’s lives.