Bangkok--8 May--24 คูณ 7
TK issues 2nd and 3rd set of debenture worth 300 million baht, the first 3 issues worth 1.2 billion baht to control its interest expenses
- The 2nd set of 3 years debenture worth 100 million baht with 4% fixed rate and the 3rd set of 2 years debenture worth 200 million baht with 3.63% fixed rate
- Increasing its long-term loan portion controlling its financial cost
Thitikorn Public Company Limited or TK, the country’s largest motorcycle hire purchase, has issued the 2nd and 3rd set of 3-year debenture worth 300 million baht to increase its long-term loan portion which will mitigate interest risk.
According to TK Managing Director Ms. Prathama Phornprapha, TK Executive Board resolution approved to issue 2nd set of debenture 100,000 units, par value at 1,000 baht, the issue date is set on April 30, 2014 and maturity date is April 28, 2017 at the fixed rate of 4%. TK Executive Board resolution approved to issue 3rd set of debenture 200,000 units, par value at 1,000 baht, the issue date is set on May 9, 2014 and maturity date is May 16, 2016 at the fixed rate of 3.63%. Both sets of debenture issued via private placement.
She mentioned that these were the 2nd and 3rd sets of debenture issued this year. The first issue was done in March worth 900 million baht with 4% fixed rate and three years term. TK plan to increase its long-term debt portion and mitigate interest risk as well as a replacement to debenture that soon to be matured. TK managed its interest cost effectively over the last several years and currently its fixed rate loan is almost 100% so TK does not have any interest rate risk.
She said although the domestic motorcycle market last year was plunged by 6.6%, TK managed to expand its loan growth by 4.8% and increased its total asset to 10,267.4 million baht, up by 6.7%. In order to shield itself against economic slowdown TK decided to accelerate its write-off and set a provision for bad debt for 565 million baht or 5.8% as of last year which had a negative impact in the short term to its net profit which plunged by 39.8% to 428.7 million baht last year.
However, TK recently announced its dividend payment of 0.43 baht per share or 215 million baht from last year operation to its shareholders on May 15, 2014. Currently, its shareholder’s equity stood at 4,013.9 million baht.
Meanwhile, Mr. Prapol Phornprapha, TK Deputy Managing Director, added that TK plans to recruit 200 new staffs for its future expansion plan after Thailand installed its new government as well as to add 3-4 new branches this year.
He said domestic motorcycle market this year would plunge by 10% to 1.8 – 1.85 million units and during the first two month of this year, the market was plunged by 22% to 275,000 units which was ten months consecutive declined as a result of political uncertainty caused by the Government unable to drive its economic policy, especially unpaid rich pledging scheme and lower export growth which badly affected to household purchasing power.