INVESTOR RELATIONS

Chairman’s Statement


Going into 2019, there was a broad consensus that global economic growth would slow and this would dampen corporate earnings momentum. The economic slowdown was expected to be moderate against a background of an accommodative global monetary environment. As it turned out, this is exactly what happened. Subdued business confidence and sluggish international trade held the global economy back in 2019, with no resolution of the ongoing U.S.–China trade spat, and this, in turn, contributed to continued weakness in private investment. However, private consumption remained resilient, supported by generally favorable unemployment data, notably in the U.S., and low interest rates.

The Thai economy was not immune to the global economic slowdown and GDP Growth for 2019 slipped to 2.4%, down from 4.1% in 2018. Exports were a weak spot and, while government spending is picking up, the impact will be delayed into 2020 due to delays in approving the Government’s Budget. That said, the prospects for Thailand’s GDP growth to improve in 2020 are not strong given continuing, if reduced, US-China trade tensions, the impact of the spread of the Covid -19 virus, which is both disrupting global supply chains and impacting tourism, a slowdown in housing construction and relatively high personal debt levels, which will be a constraint on personal consumption.
The Thai economy was not immune to the global economic slowdown and GDP Growth for 2019 slipped to 2.4%, down from 4.1% in 2018. Exports were a weak spot and, while government spending is picking up, the impact will be delayed into 2020 due to delays in approving the Government’s Budget. That said, the prospects for Thailand’s GDP growth to improve in 2020 are not strong given continuing, if reduced, US-China trade tensions, the impact of the spread of the Covid -19 virus, which is both disrupting global supply chains and impacting tourism, a slowdown in housing construction and relatively high personal debt levels, which will be a constraint on personal consumption.
While we did not expect global equity markets to correct in 2019 in the face of moderating economic growth, the gains in equities, the U.S. market in particular, were a surprise. The S&P500 Index rose 30% over the year achieving an all-time high on 27 December. This gain was driven primarily by an expansion of the Price Earnings multiple, rather than by underlying earnings growth, though earnings per share were boosted by continued aggressive share buyback programmes . PE expansion was essentially the result of renewed interest rates cuts in the US and for this reason, the US market’s rerating was arguably a monetary rather than “fundamentals” outcome. Adding to investors’ appetite
for US equities was relatively limited volatility.

developed markets. The Thai economy is unlikely to deliver a stand out performance. Forecasts for economic growth in 2020 are already being trimmed back and some forecasts are now below 2.0% for the year in the light of the Covid-19 virus outbreak and its impact on tourism and exports to China, the strength of the Thai Baht which has had a major negative impact on Thai export competitiveness and the delays in approving the Government’s Budget. However Thailand’s economic fundamentals remain broadly sound with exceptionally strong Balance of Payments and International Reserves positions.
Turning to the group performance in 2019, Finansa Pcl reported a Consolidated Net Loss of Bt82.6 million for the year, against a Net Profit of Bt64.1 million for 2018. The key reasons behind the earnings reversal were a collapse in Investment Banking fees at subsidiary, Finansa Securities Ltd (where fee income fell 85% YoY) and the increase in losses at Associate, Finansia Syrus Securities Pcl (29.29% owned) which reported a loss of Bt138 million for the year. Finansa Securities Ltd has been working on significant mandates including being Financial Advisor to a proposed, major listing. This listing was due to take place in 2019, but has been postponed. Finansia Syrus Securities Pcl has been hit by a significant reduction in trading activity by Thai Retail investors on the Stock Exchange of Thailand.
Going forward, management is confident that Finansa Securities will see a rebound in revenues in 2020, while Finansia Syrus Securities is likely to face another challenging year in terms of brokerage revenues. While there has been an ongoing and active programme of cost cutting at Finansia Syrus Securities, this will be stepped up in 2020 in response to the difficult environment.
On a more positive note, Finansa Pcl announced in February its intention to sell its warehousing at the Bangkok Free Trade Zone to the Prospect Logistics and Industrial Leasehold Real Estate Investment Trust. The Trust Manager is currently preparing documents to present to the SEC for permission to establish the Trust. Should the transaction proceed, Finansa Pcl will record a material gain over its original investment cost. It is also worth noting that NEO Corporate Ltd, the principal Private Equity investment of Finansa Pcl’s, performed strongly in 2020 and the company is preparing for a listing on the Stock Exchange of Thailand in 1H 2021.
Overall, 2020 is likely to be a challenging year all round, given the economic backdrop, however the management of Finansa Pcl is confident that the year will see positive developments for the company.

(Dr. Virabongsa Ramangkura)
Chairman

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QUARTERLY FINANCIALS

ANNUAL SUMMARY FINANCIALS

Bt. Million

Consolidated Financial Statements 2020 2019 2018
Revenues
Revenues from business operation 552.0 279.0 517.7
Compensation fee from termination of sublease agreement 198.1
Other income 13.5 26.4 4.1
Total income 763.6 305.4 521.8
Costs and Expenses
Finance costs 72.7 64.3 53.7
Business operation costs and expenses 283.8 220.3 261.1
Servicing and administrative and other expenses 54.7 42.7 47.9
Allowance for expected credit loss/Impairment loss on investment 61.7 26.8 22.6
Other expenses 75.2 36.2 79.6
Total costs and expenses 548.1 390.3 464.9
Profit (loss) from operations 215.5 (84.9) 56.9
Share of profit from investments in associated companies 30.8 (7.1) 27.7
Income tax - income (expense) (23.0) 9.4 (20.5)
Net profit for the year 223.3 (82.6) 64.1
Earnings per Share (Bt.) 0.65 (0.24) 0.25
 
Consolidated Financial Statements 31-Dec 2020 31-Dec 2019 31-Dec 2018
Total Assets 4,068.3 4,096.7 4,359.8
Total Liabilities and Shareholders' Equity
   - Total Liabilities 1,261.9 1,421.3 1,537.3
   - Total Shareholders' Equity 2,806.4 2,675.4 2,822.5
Total Liabilities and Shareholders' Equity 4,068.3 4,096.7 4,359.8
Issued and paid-up share capital (share) 345,855,440
 
2020
31-Dec 2020
2019
31-Dec 2019
2018
31-Dec 2018
Net Earnings to Total Income 29.2% -27.0% 12.3%
Return on Average Total Assets 5.5% -2.0% 1.6%
Return on Average Total Shareholders' Equity 8.1% -3.0% 2.5%
Debt to Equity (times) 0.45 0.53 0.54
Book Value per Share (Bt.) 8.11 7.74 8.16
 

ANNUAL REPORTS

(Bt. Million)

Consolidated Financial Statements (Quarterly) Q4-2019 Q1-2020 Q2-2020 Q3-2020 Q4-2020 % QoQ % YoY
Revenues
Revenues from business operation 77.4 60.1 279.9 74.7 137.3 84% 77%
Other income 9.1 7.8 4.0 198.9 0.9 -100% -90%
Total income 86.5 67.9 283.9 273.6 138.2 -49% 60%
Costs and Expenses
Finance costs 16.1 15.7 15.7 17.1 24.2 42% 50%
Business operation costs and expenses 43.9 53.3 103.3 66.8 60.4 -10% 38%
Servicing and administrative and other expenses 11.2 34.6 1.1 11.0 8.0 -27% -29%
Allowance for expected credit loss/Impairment loss on investment 26.8 - - - 61.7 - 130%
Other expenses 10.3 8.8 8.6 9.0 48.8 442% 374%
Total costs and expenses 108.3 112.4 128.7 103.9 203.1 95% 88%
Profit (loss) from operations (21.8) (44.5) 155.2 169.7 (64.9) -138% 198%
Share of profit from investments in associated (27.1) (18.3) 6.7 33.6 8.8 -74% -132%
Income tax - income (expense) (0.7) 4.6 (29.0) (24.8) 26.2
Net profit for the period (49.6) (58.2) 132.9 178.5 (29.9) -117% -40%
Earnings per Share (Bt.) (0.14) (0.17) 0.38 0.52 (0.09) -117% -40%
 
Consolidated Financial Statements 31/12/2019 31/03/2020 30/06/2020 30/09/2020 31/12/2020 % QoQ % YoY
Total Assets 4,096.7 4,040.8 4,343.3 4,359.3 4,068.3 -6.7% -0.7%
Total Liabilities and Shareholders' Equity
   - Total Liabilities 1,421.3 1,396.9 1,593.0 1,481.1 1,261.9 -14.8% -11.2%
   - Total Shareholders' Equity 2,675.4 2,643.9 2,750.3 2,878.2 2,806.4 -2.5% 4.9%
Total Liabilities and Shareholders' Equity 4,096.7 4,040.8 4,343.3 4,359.3 4,068.3 -6.7% -0.7%
Issued and paid share capital(share) 345,855,440
 

* annualized

Key Ratios Q4-2019
31/12/2019
Q1-2020
30/03/2020
Q2-2020
30/06/2020
Q3-2020
31/09/2020
Q4-2020
31/12/2020
% QoQ % YoY
Net Earnings to Total Income -57.3% -85.7% 46.8% 65.2% -21.6%
Return on Average Total Assets -1.2% -1.4% 3.2% 4.1% -0.7%
Return on Average Total Shareholders' Equity -1.8% -2.2% 4.9% 6.3% -1.1%
Debt to Equity (times) 0.53 0.53 0.58 0.51 0.45
Book Value per Share (Bt.) 7.74 7.64 7.95 8.32 8.11 -2.5% 4.9%
 

PERFORMANCE INDICATORS

EPS (ROLLING 12 MONTHS)

TOTAL ASSETS

TOTAL SHAREHOLDERS’ EQUITY

BOOK VALUE PER SHARE

NEWS AND ANNOUNCEMENTS

SHARE PRICE PERFORMANCE

DIVIDENDS

Period Amount XD Date Payment Date
1-Jan-20 to 30-Jun-20 Bt 0.15 1-Oct-20 14-Oct-20
1-Jan-18 to 31-Dec-18 Bt 0.15 3-May-19 21-May-19
1-Jan-17 to 31-Dec-17 Bt 0.15 7-May-18 24-May-18
1-Jan-16 to 31-Dec-16 Bt 0.10 3-May-17 24-May-17
1-Jan-15 to 31-Dec-15 Bt 0.10 3-May-16 19-May-16
1-Jan-15 to 30-Jun-15 Bt 0.20 14-Oct-15 27-Oct-15
1-Jan-14 to 31-Dec-14 Bt 0.10 8-May-15 25-May-15

SHAREHOLDERS’ MEETING AGENDA / MINUTES

  • Invitation to shareholders to propose the Annual General Shareholders’ Meeting Agenda and Director Nominee in advance >> For details,click here(Thai only)