AMATA-WHA and the “EEC Effect”

Whenever there are news about Thailand’s Eastern Economic Corridor (EEC) project, the share prices of Amata Corporation Public Company Limited  (AMATA) and WHA Corporation Public Company Limited (WHA) tend to climb higher despite any other factors whether negative or positive ones.

EEC seems like a playbook for both shares and investors to speculate the share price. Which is why a lot of investors had anticipated that the revenue at the end of 2018 would came out satisfyingly.

 

Sadly, the revenue that both companies had revealed through the Stock Exchange of Thailand not long ago turned out to be a disappointment. Not only did both companies reported lower revenue, their net profit also declined as well which is quite the opposite from how their stocks were on a hike not long ago.

 

AMATA booked a net profit of THB 1,018.2 million, decreased THB 391.3 million or 27.76% YoY mainly due to the lower sales from industrial estate which recorded at THB 1,835.7 million, decreased by THB 248.7 million or 11.93% YoY due to most of the land recognition has lower prices compared to last year. The gross profit margin in 2018 was 63%, down by 6% from 2017.

Moreover, AMATA also recorded higher expenses in 2018. The company administrative expenses were THB 817.3 million, increased THB 167.7 million or 25.83% YoY.

The current position of WHA is not any better than AMATA as the company also recorded lower profit in 2018 as well. Its net profit was THB 2,906.8 million, dropped THB 359.6 million or 11.0% YoY while posted a revenue at THB 11,622.2 million, decreased THB 787.8 million or 6.3% YoY.

WHA asserted that rental and service income from warehouses, distribution centers and factories for 2018 was THB 1,025.3 million, decreased THB 92.9 million or 8.3% YoY. The main reason was due to the asset monetization to WHA Premium Growth Freehold and Leasehold Real Estate Investment Trust (WHART) and HREIT in the late 2017 and the beginning of 2018 respectively, thereby reducing the leasable area.

Income from sales of real estate also decreased as well. In 2018, the company recorded income from sales of real estate at THB 2,124.9 million, down 1,085.9 million or 33.8% YoY.

 

These have proved that the “EEC Effect” did not reflect on the revenue and profit of AMATA and WHA at all….or maybe for now. So, it is no surprise to see the share price of AMATA and WHA moving in a narrow range. Seems like they might need another EEC news to lighten the share up again.