EASTW Aims for 10% Earnings Growth in 2019, Targeting Tariff Increase for Higher Revenue!
EASTW aims to increase its earnings growth by 10% in 2019 from higher demand of commodity while a tariff increase of between 5% and 15% on water sales to manufacturers will also add to earnings growth from 2020.
On June 17, 2019, a reporter has stated that Eastern Water Resources Development and Management Public Company Limited (EASTW), Thailand’s largest private water company, may sell a record volume of the commodity this year on rising demand from power producers, petrochemical manufacturers and a state utility.
The Bangkok-based company, the biggest water supplier in the nation’s eastern industrial area, expects to supply at least 300 million cubic meters this year, an increase from about 250 million cubic meters in 2018, said Chief Executive Officer Jirayut Rungsrithong. Higher water sales will help earnings grow by more than 10% in 2019 after a contraction last year, he said.
EASTW joins companies such as Amata Corporation Public Company Limited (AMATA) and WHA Corporation Public Company Limited (WHA) in benefiting from a spate of investments in new factories and other manufacturing facilities in eastern provinces under the Thai government’s Eastern Economic Corridor program (EEC). Prime Minister Prayuth Chan-Ocha, who this month won a parliamentary vote for a second term, has earmarked the development of three eastern provinces to lure new foreign direct investments.
“We have high hopes for much more direct investment in the eastern region,” Jirayut said in an interview Friday. “This should help us achieve double-digit earnings growth for the next few years.”
EASTW, whose major shareholders include the state-run Provincial Waterworks Authority and Manila Water Co., plans to invest about THB 2.1 billion ($67 million) to build a new pipeline to transfer water from state reservoirs to its own reserve, he said.
From 2020, a tariff increase of between 5% and 15% on water sales to manufacturers will also add to earnings growth, according to Jirayut.
The company’s net profit for the January-March period jumped 13% from a year earlier to THB 344 million. Its shares have risen 14% this quarter through the June 14 close, compared with a 2.1% gain in the benchmark SET Index.