Bangkok--18 May--Online Asset
TEAM’s gross profit is 35 millions Baht or 10%, which included additional inventory provision and sales reversal for a customer in Canada who has financial problem and cannot make a payment of 19 million Baht. Excluding this “One Time” booking, the company would have reported gross profit of 54 Million Baht or 15.6% compared to 56 Million Baht or 18% rate of the same quarter of the prior year As a result of setting a provision for a Canadian customer, the net profit was left 3 millions Baht. Mr. Rich Fitgerald said from now on, the company would take care of debt & credit carefully and go on penetrating into different markets. Recently, the orders in hand value 992 millions baht, comparing with 868 millions baht of last year, confident that the revenue will be growing in the different direction of the economic situation.
Rich Fitzgerald, Chief Executive Officer of Team Precision Public Company Limited or TEAM, disclose the company performance in the first quarter of 2009 as of 31st March, 2009 that the company has total 334 millions baht of revenue, increasing from the same quarter of last year 12.7%. This growing revenue comes from Europe market in the majority which is contribute to 54% of revenue in 1/ 2009, comparing with 40% of the revenue in 1/2008 and compensate to the reduction of America and Asia market. Moreover, the strategy of penetrating the new market can help the company deliver goods to new customers more in this quarter, resulting in 54 millions of profit or 15.6% in 1/2009, comparing with 56 millions baht or 18% in 1/2008.
However, the company has booked the provision as a one-time hit in this Q1’09 as a conservative approach because of a customer in Canada who just turned in to a financial crisis and can not pay for the ordered goods, total impact is 19 millions Baht. This effect to the gross profit of the company in the first quarter to be 35 millions baht or profit 10% of sales, and reflect to the net profit of the company to be 3 millions Baht in this quarter or 0.9% of sales. It is decreased from the same quarter last year which the net profit is 10 millions Baht or net profit is 3.4% of sales because of customer problem stated before. Without regarding of the special one-time impact item, net profit would be 22 millions baht or 6.4%.
Mr. Rich also said that the company also aims to penetrate into the market such as Niche market which was not directly effected from macro economic. The company also tries to raise the level of manufacturing base to the world-class standard. Due to an inconsistence of customers abroad, the company focuses on credit control, payment follow up of present and new customers, besides the improvement of manufacturing and controlling expense, company also try to adapt to suit to the economic condition and support the growing of business. However, company accept that the problem of economic recession still hindering the growing of the company, but from the past until now, TEAM precision has been adapting to be suit to current situation, so confident that the revenue can be increased from the past.
“From the past “TEAM Precision” has set the new vision, and aim to serve in electronic manufacturing and assembling with the world class standard that customer choose first, and adapt many strategies and business expanding directions in order to pave the way to for the company to grow up eminently in the future, no matter the establishment of offices in other countries such as Singapore, Denmark to seek for the low cost of material from over the world and can reduce cost, strengthen of management team by recruiting the professional to manage, as well as setting marketing team and international sales team, moreover, expanding customers base into new in order to adapt the revenue proportion and not only rely on big customers, which is the majority of the revenue in the past (80%), now reduce to 70% and expect to reduce more in this year because of more new customers. ”
Mr. Rich also said that, for the factory, besides expanding the areas to support more customers, also aim to develop manufacturing technology to be able to rapidly produce new products to the market which will be benefit to customers directly. At the same time company bring technology in inventory management which is another service that can add value to customers. Moreover, also raise standard of the factory and other manufacturing part to world-class standard to increase customer’s confidence. All services improvement get good feedback from customers and company believe that the result from strategies adaptation can be seen apparently from good performance among recession period.
For the plan this year, TEAM aim to expand customer base more clearly, especially new innovative electronic, because the manufacturer has to develop product continuously and follow with the changing technology. Besides customers base was expanded, it can reduce risk from only relying on a group of customer which in accordance of company new policy. For new market expansion this year, company will open new market to India for the first time, because it has a high growing potential. From the management and employees contribution in the past time, as of 31st March, 2009, there are up to 992 millions Baht of orders from customers which is apparently higher from last year (868 millions Baht). As a result, company confident that can push the revenue to grow up from the past which is 1,456 million baht. The growing rate was expected to be higher than market growing rate which is in the range of 7-8% even in this economic situation.
For more information, please contact: Khun Wasara Chotithammarat, investor relation, Tel. 02-5772350 ext.106