SET requests to clarify news or information


Subject                                  : Clarification of news or information 
requested by SET
Description (Update)                     :
Subject 	Clarification on Additional Information for the Q1/2025 Financial 
Statements as Requested by the Stock Exchange of Thailand (Revised)
To	President
The Stock Exchange of Thailand
Reference:
1.	The Company's Q1 2025 financial statements
2.	Annual Information Form for the year 2024 (Form 56-1 One Report)
3.	Company News dated February 28, 2025
K.C. Property Public Company Limited (the "Company") has submitted its reviewed 
financial statements for Q1 2025 to the Stock Exchange of Thailand (the "SET").
The auditor expressed an unqualified opinion with an emphasis of matter
regarding the Company's going concern and significant legal cases. It was also
noted that the Company no longer has revenue from its core business in real
estate sales and reported only THB 8 million in other income, primarily from
gains related to lease extension of land and buildings. The Company continues to
 record a net loss.
However, Note 10 to the financial statements states that in 2023, the Company 
entered into a joint investment agreement with another company to develop a
housing project with 163 units. The Company also had four ongoing projects as of
December 31, 2024, with a total backlog value of THB 257 million, as per
reference document 2.
Furthermore, Note 14 of the financial statements refers to an investment 
property whereby in 2022, the Company entered into a 10-year lease agreement
(renewable for another 10 years) for the Chuamitr commercial land and building,
with a total lease value of THB 117 million. On February 20, 2025, the lease was
extended by an additional 5 years, bringing the total term to 25 years and the
lease value to THB 147 million (an increase of THB 30 million). Although the
Company has paid rent monthly for the past 2 years and 6 months and completed
building renovations in October 2024, it has yet to receive the official permit
to use the building (Form A.5) from the relevant government agency, as detailed
in reference 3.
Therefore, the SET requests the Company to clarify the following issues to 
ensure investors are fully informed in their investment decisions, through the
SET disclosure system by June 4, 2025:
1. Reasons for the absence of revenue from core business, business plans and 
backlog management to generate short-term income, and the reason for recognizing
 business tax and transfer fees without any recorded sales.
Company's Clarification:
1.1 Due to the current economic situation both domestically and globally, the 
real estate sector which is often the first industry to be impacted has been
significantly affected. Consumer purchasing power has declined, and the market
is saturated with unsold housing units. Although this could benefit buyers, the
strict lending conditions imposed by financial institutions have slowed down
property transactions. Moreover, government economic stimulus measures have been
delayed. The Company has been affected by both external factors and some
internal factors, as it currently has only four ongoing projects, three of which
are ready-for-sale and one joint venture, as detailed in item 2. In the real
estate business, choices of projects and house models are limited. However, with
the government's new real estate promotion measures, reducing transfer and
mortgage fees to 0.01% for residences priced up to 7 million baht, effective
from the Royal Gazette announcement on 22 April 2025, and the easing of loan
ceiling restrictions allowing full loan amounts against collateral value, the
Company expects property title transfers to occur in Q2 2025. Regarding business
operations and management, the Company has mobilized all sales and marketing
resources across offline and online channels, sales agents, and customer
referrals, including monthly promotional strategy adjustments to stimulate sales
 and ensure continuous revenue from its core business.
1.2 In Q1 2025, the Company recorded business tax and transfer fees for the sale
of one undeveloped land plot. The sale agreement was signed in November 2024
with a deposit of THB 10 million. The remaining THB 89 million was received upon
title transfer on January 16, 2025. This transaction resulted in a loss of THB
9.86 million, which had been fully recorded as an impairment loss in the 2024
financial statements.
2. Whether the housing development project under the joint investment agreement 
is progressing according to plan, and remedial measures if it is not.
Company's Clarification:
The Company entered into the joint investment agreement in February 2023, with a
term of 5 years. The Company invested land and existing buildings (six model
homes) for 163 plots. The Company receives compensation for the land and
buildings as specified in the agreement plus utility fees. The joint venture
partner manages construction, sales, and project administration, receiving
payment from the sale price after deducting the Company's land and common area
service fees.
The joint venture project's sales plan divides by zones, opening each zone 
sequentially. From 2023 to 2024, 19 units were sold and transferred, with a plan
to sell 22 units in 2025 (starting Q3), 31 units per year in 2026 and 2027, and
 28 units in 2028.
Sales are on schedule, with only one unit remaining in the first opened zone. 
The Company expects to recognize revenue from ownership transfers in Q2 2025.
The Company has been closely monitoring the construction progress of the housing
development project under the joint investment agreement. Currently, the
construction is proceeding according to plan, and it is expected that sales will
commence as scheduled in Q3/2025. Although this project has been affected by
market conditions outlined in 1.1, the Company still anticipates recognizing
revenue from the property transfers in Q2/2025.
3. Reasons why the Company has not yet received Form A.5 from authorities, the 
Company's action plan and timeline to obtain the permit, post-permit plans such
as tenant sourcing, and reasons and necessity for extending the lease with
Chommitr Land and Building, including key conditions (if any).
Company's Clarification:
In November 2022, the Company submitted a construction, alteration, and 
demolition notification form under Section 39 ter (Form Y.P.4) and resubmitted
an updated form on 30 October 2024 to reflect the current condition of the
completed renovations. Throughout this period, officials from the Bangkok
Metropolitan Administration's Department of Public Works provided guidance and
minor revision suggestions intermittently.
On 19 February 2025, the Department confirmed that the building alterations for 
office and residential use comply with relevant laws and regulations. On 18
April 2025, the Company notified local officials to inspect the construction or
alteration (Form T.S.2). During the near-completion renovation period to the
present, the Company has continuously sought tenants and maintained contact with
interested parties. Although interest remains, the delay in permit issuance has
caused prospective tenants to withdraw due to waiting time, resulting in lost
rental income and business opportunities.
Therefore, the Company signed a memorandum to extend the lease agreement, under 
which, upon expiration of the original lease, the lease term is extended from 10
to 15 years. If the lessor does not renew the second term, the lessor agrees to
compensate the Company up to 300 million baht for construction costs and
business opportunity losses. Rental rates and payments remain under the original
contract at 500,000 baht per month. From lease commencement until June 2025,
the Company has paid 13.5 million baht in rent (including a 6-month rent-free
period from October 2022 to March 2023).
On June 4, 2025, the Bangkok Metropolitan Administration's Department of Public 
Works issued a letter notifying the approval of the certificate for the
construction, modification, or relocation of a controlled-use building (Form
Aor.5), and instructed the lessor to collect the certificate (Form Aor.5) within
 30 days.
The Company will expedite coordination with the lessor to obtain the certificate
 (Form Aor.5) as soon as possible.
Please be informed accordingly.


                         Signature ___________________________
                                    ( Vichai Satjaharuthai )
                                    Director Authorized sign on behalf of the 
Company
                         Authorized to sign on behalf of the company

______________________________________________________________________

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