Bangkok--24 Mar--SET
The Stock Exchange of Thailand (SET)’s Corporate Strategy and Development publishes SET Note Corporate Update No. 1/2010 analyzing the average listed company enjoyed a net profit increase by 44.08% in 2009, THB432.27 billion (approx. USD 13.365 billion) over that of 2008, as a result of improved operating efficiency and cost control. In addition, the average listed firm’s Q4/2009 revenue improved for the third consecutive quarter, reflecting Thailand’s economic recovery.
In 2009, although listed companies recorded total revenues of THB6,301 billion (approx. USD 194.82 billion), a 13.85% drop over the 2008 figures, total net profit rose to THB432.27 billion (approx. USD 13.365 billion), a 44.08% rise year-on-year (y-o-y). This increase in net profit was due to more efficient operations and better cost controls, as shown by the cost/income ratio, which declined to 91.26% (in 2009) vs. 93.17% (in 2008). Also, some large firms reported that they had no stock losses this year, unlike in 2008. The operating performance of 78.43% (or 400 companies) of all listed firms improved in 2009, vs. 73.64% in 2008.
In terms of operating efficiency in 2009, overall efficiency improved when compared to 2008. Return on equity (ROE) rose to 12.10% from 7.83% in 2008, and return on assets (ROA) increased to 9.54% from 7.75% in 2008. The firms’ debt/equity ratio (D/E ratio) was relatively low at 1.15 times, very close to the 1.14 times in 2008, and shows that the companies had retained their financial strength, including shareholder equity, despite economic volatility.
For an overview of investments, even though 2009 investment decreased to THB373.27 billion (approx. USD 11.541 billion), down 8.58% y-o-y, 343 companies, or 92.70%, of all listed companies increased their investment in fixed assets in Q4/2009, a continued rise over the 91.22% in Q3/2009 and 87.00 % in Q4/2008
Listed companies raised total of THB35.13 billion (approx. USD 1.086 billion), down 31.26% y-o-y. However, in 2009, there were indications of economic recovery and an improved capital market situation, resulting in more new listings: 17 such listings in 2009, vs. only 11 companies in 2008. While, fundraising in secondary markets in 2009 was THB 23.53 billion, with a continual increase since Q2/2009.
In Q4/2009, listed firms had total net profit of THB110.30 billion (approx. USD 0.293 billion), an increase compared to Q4/2008, where the companies recorded a total net loss. Nevertheless, seasonal costs caused a slight drop of net profit by 3.95% in Q4/2009 from Q3/2009. Taken as a whole, economic recovery, as reflected in improved revenue for three consecutive quarters, and effective cost control should build a strong foundation for improved performance of listed companies.
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