Despite the challenges due to the COVID-19 pandemic, WHA Corporation Public Company Limited (WHA Group) is confident and poised to benefit from the expected global economic recovery and accelerating digital transformation. As vaccination programs are rolled out, recovery signs are starting to appear with strong increases in global trade, Thailand's exports and inflows of Foreign Direct Investments.
For 2021, WHA Corporation PCL (WHA Group) anticipates that the normalized total revenue and share of profits will reach an all-time high with an increase of over 30% from last year, while sustaining high profitability level with an EBITDA margin in excess of 40%. The company also targets to divest assets to WHART worth more than THB 5,500 million in Q4 2021. "Our target interest bearing debt (IBD) to equity ratio remains at 1.3 time. We will continue to maintain a strong balance sheet, to invest to grow our businesses, to support the interests of our customers and to generate positive returns for our shareholders," said Ms. Jareeporn Jarukornsakul, Chairman and Group CEO, WHA Corporation PCL.
A Promising Outlook for 2021 and Beyond
- WHA Logistics activities continued to prosper since the beginning of 2021 and to show a promising outlook, backed by growing demand from e-commerce, long-term partnerships with global key players and new technologies.
In the first half of 2021, new projects totaling 35,000 sq.m. were secured and short-term contracts representing 100,000 sq.m. were signed. By the end of the year, 5 new logistics projects representing over 110,000 sq.m. will be delivered, while new and expanded Mega Logistics projects, totaling over 400,000 sq.m., will be launched.
The COVID-19 crisis resulted in the accelerated rise of e-commerce, leading to an increased demand for distribution centers of consumer goods. In addition, WHA Logistics has benefited from strong demand for Ready Built Factories and Warehouses in consumer products and electronics sectors. By year end, the forecasted area under ownership and management will total 2,560,000 sq.m.
WHA Logistics is exploring smart technologies to create more value-added, innovative and one-stop service solutions to serve customers' needs. With the acquisition of 29.40% stake in Storage Asia Co., Ltd., a leading premium self-storage solution, under the brand "i-Store Self Storage", WHA Logistics will leverage on its expertise and know-how in the logistics business to help Storage Asia create enhanced self-storage services, using advanced technologies and innovation. This year, WHA Logistics plans to inject 180,000 sq.m. of Built-to-Suit and general warehouses into WHART with a total asset value of over THB 5,500 million.
- WHA Industrial Development (WHAID) is extending its leadership position in Thailand and is expanding in Vietnam on a national basis. Its 12 industrial estates - 11 in Thailand and 1 in Vietnam, plus 3 upcoming estates in Thailand and 2 upcoming industrial zones in Vietnam respectively - will represent a total land of 68,000 rai, including 49,900 rai under operation and development.
In Thailand, the development of both WHA Eastern Seaboard Industrial Estate 3 (WHA ESIE 3) and WHA Rayong 36 (WHA RY 36) 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. As a result, WHAID will have Thailand's largest industrial land available for sale located in strategic locations to capture upcoming investments.
In Vietnam, WHA Industrial Zone 1- Nghe An completed construction of the 1,000-rai Phase 1, with 54% already leased to customers from China, Japan and Thailand, whose activities span across sectors such as electronics, food processing, automotive parts, solar energy and building materials. Construction of the 2,100-rai Phase 2 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.
WHA Industrial Development continues with the implementation of its 'Smart Eco Industrial Estates' concept by embracing innovative new technologies. To that aim, a new milestone was reached with the start of operations of the Unified Operations Control Center located at WHA Tower to monitor all key operating and environmental indicators including data on traffic, safety, air emissions, water levels, waste water quality gathered from its Smart Traffic Management system, CCTV, SCADA systems installed at WHAID industrial estates in Thailand.
In addition to its geographical expansion, WHAID is expanding its products offering. In partnership with China's Tus-Holdings, WHAID started the operations of TusPark WHA Incubation Center, located in the Chulalongkorn University compound, in Q1 2021. TusPark WHA actively collaborates with universities to create an innovation ecosystem for startups and promote cooperation in Science and Technology between China and Thailand. In addition, in collaboration with Bangkok Industrial Gas Co. Ltd., BIG WHA Industrial Gas is building a gas-separation plant and a pipeline which will provide its customers with nitrogen gas in the Eastern Seaboard Industrial Estate (ESIE) and adjacent WHA Eastern Seaboard Industrial Estate 1 (WHA ESIE 1). BIG WHA Industrial Gas will start supplying Nitrogen to customers in Q4 2021.
- WHA Utilities and Power (WHAUP) is continuing to grow its Utilities business inside and outside the Group's industrial estates, both in Thailand and Vietnam. It is also developing innovative renewable energy solutions, in particular in the solar energy business.
In Utilities, WHAUP continues to expand products and solutions focusing on value-added water products, such as wastewater reclamation and demineralized water using reverse osmosis membrane technology. In Thailand, during the first half of 2021, WHAUP increased its water supply and wastewater volume, as well as value-added water supply volume, by respectively 16% and 170% YoY. Several projects in pipeline are under development and construction such as the new water treatment plant in WHA RY36 with a supply capacity of 2.74 million m3/yr, the reclamation and demineralized water plants supplying demineralized water to industrial customers in non-WHA Industrial Estate and the alternative raw water project with a capacity of 6 million m3/yr .
In Vietnam, WHAUP has 3 projects in operation which contribute to a total water supply and wastewater volume of 10.5 million m3, a 25% YoY increase. For the projects that WHAUP owns equity stakes in, specifically Duong River Surface Water Treatment Plant (34% equity) has higher utilization rate and noticed 26% YoY increase in water sales volume in 1H2021 while Cua Lo Water Plant (47% equity) completed in July the construction of its plant's capacity expansion to 7.3 million m3/yr.
In Power, WHAUP continues to broaden its portfolio with the development of renewable energy solutions in addition to conventional power. Since the beginning of 2021, a number of rooftop projects have been commissioned including Continental Tyres at WHA ESIE 4, Honda in Prachinburi - and new contracts have been signed, representing a total capacity of 46 Equity MW in operations and 63 Equity MW of signed PPA, respectively. Altogether, WHAUP's solar business is expected to reach a total signed capacity of 90 MW by year end. As part of its strategy focusing on innovative solutions, WHAUP signed MoUs with leading energy partners, PTT and Sertis, to develop smart energy platform to trade solar energy among customers within WHA industrial estates. In 2021, WHAUP will have a total installed capacity of 670 Equity MW.
- WHA Digital Platform continues to carry out its plan to offer fiber optics (FTTx) in WHA's 10 operating industrial estates in Thailand. As of today, FTTx is provided to all customers in six industrial estates while construction and migration continues at the remaining four.
Participating in the development of 5G is another key part of WHA Digital Platform's strategy. It has signed MoUs with all major telecom operators - AWN, True and Dtac - to collaborate on 5G network planning and 5G solutions and to accelerate smart solutions for WHA customers.
WHA Digital Platform is also increasingly involved in collaborations with startups for new technologies and innovations that can enhance products and services provided to WHA customers.
Meanwhile, WHA Group provided support to the country's healthcare system, by transforming its 10,000 sq.m. warehouse at WHA Mega Logistics Center Chonlaharnpichit KM 4, into a 1,300-bed field hospital, "Samut Prakan Ruamjai 5 (WHA)" for asymptomatic COVID-19 patients.
In addition, to expand its property business, the group recently launched "WHA Office Solutions", offering a total of 100,000 sq.m. of world-class office spaces in 6 high potential locations in Bangkok and Samut Prakan, including WHA Tower's new headquarters. Other properties are SJ Infinite I Project, @Premium Office Building, WHA Bangna Business Complex Project, TusPark WHA Incubator Center, and WHA KW S25 Project, currently under construction.
"Sailing through this particular environment has been a challenging journey rich with fresh opportunities, explained Ms. Jareeporn Jarukornsakul, Chairman and Group CEO of WHA Corporation PCL. "While we see recovery signs on the global economic scene, we hope that Asia in general and Thailand in particular will be able to speed up vaccination roll-out to overcome the COVID pandemic. In a way, this crisis forced us to accelerate our digital transformation and adopt new technologies, which enable us today to look at the future with optimism," she concluded.