AP keeps its growth plan

Asian Property Development Plc will maintain its 10% target revenue growth and expected 17 new project openings worth a combined 26 billion baht this year despite the ongoing political showdown.
“Matters are unclear now but we are keeping new project launches and maintaining our debt to equity as well as holding enough cash on hand in the event of any possible slow down,” said CEO Anuphong Assavabhokhin.
“If we don’t continue the planned project developments, we may not have products to sell in the next 16 months if the economy is good. But if we develop too many projects, this is also risky.”
Asian Property received approval from its shareholders to issue debentures worth a maximum of 4 billion baht with a 10-year maturity, which will be offered to Thai and foreign investors as well as individuals and institutions.
Part of the amount is likely for the repayment of its matured debentures of 1.5 billion baht this year, though the company has not yet specified the objective of issuing new debentures.
The company wants to keep its debtto-equity ratio at a maximum of 1 time in an aggressive growth plan or 0.8 times for a conservative business plan. Its current ratio stands at 0.7 times.
Mr Anuphong said the company wanted to issue debentures because they provide longer payment terms with no requirement for a specific repayment period, unlike funding terms from commercial banks.
For the first quarter, AP has sales of 2.84 billion baht, up from 1.57 billion in the same period of 2009, when the global economy was sinking.
To date, the company has inventory worth 7.4 billion baht available for sales, 5 billion of which are low-rise units. It has backlog sales of 19.95 billion baht, of which 17 billion was from condominium sales.
The company believes that domestic interest rates will not increase this year. Stable interest rates will benefit large developers because commercial banks will release home loans mainly to customers of large developers amidst tough competition.
AP plans to launch most of its projects in the second half of the year, including seven townhouse projects, and three single-house and condominium projects. It believes the market will pick up in the third quarter. It will pay a dividend of 32 satang per share on May 19.
AP shares closed yesterday on the SET at 4.96 baht, down four satang, in total trade of 102.6 million baht.
Source : bangkokpost.com