06 Aug 2018 17:25:00
Management Discussion and Analysis Quarter 2 Ending 30 Jun 2018
Management Discussion and Analysis Company name : BANGSAPHAN BARMILL PUBLIC COMPANY LIMITED Year : 2018 Quarter : Quarter 2 Ending : 30-Jun-2018 Note : The Company would like to disclose the Financial Statements (reviewed) for the Quarter ended 30 June 2018 with management explanation as following. Income Statements Analysis, Comparison of Quarter 2 of 2018 VS Quarter 2 of 2017 Revenue from sales in Q2 of 2018 was at Baht 648 million, increased by 29.8% yoy, as a result of the increase in sales volume due to the expected rise in domestic steel prices. Sales volume in Q2 this year of 34,243 MT was 13% higher than the sales volume in the same period of last year. Meanwhile, the average selling price was in the upward trend as a result of the market mechanism and the world steel bar price. In the second quarter of 2018, the Company's gross profit margin was at 3% comparing to gross profit margin of 6% in the same period last year. This derived from the reduction of the spread between selling price and cost of the major raw material - steel billet (Metal spread) as a result of the increasing rate of the billet cost was higher than the selling price of the steel bar. Cost of steel billet generally accounts for 85-90% of total cost of the goods sold, therefore, the decrease in Metal Spread has caused the major impact to the gross margin. The spread in Q2 this year was Baht 250 lower than the spread in same period last year. The selling expenses in Q2 of 2018 and 2017 were at Baht 8.8 million and Baht 8.3 million, respectively. The major expense was the transportation cost which directly related with the sales amount at the approximate rate of 1.5-2.0%. The administrative expenses which most of them represented the employee expenses were slightly decreased from the same period of last year. For the other incomes in Q2 of 2018, the Company had the income from sales of scrap totaling Baht 5.4 million with the related cost of sales of Baht 1.5 million. On the other hand, the Company got the income from the compensation from the damage incurred from heavy flood in the southern of Thailand totaling Baht 38.9 million in Q2 of 2017. As a result, the Company had the net income of Baht 9.2 million in Q2 of 2018, 79% decreased, comparing to the net income of Baht 43.3 million in the same period last year. For the operating result for the first six months of 2018, the Company had the net income of Baht 19.9 million, decreased by 76% from those of Baht 84 million in the same period of last year. Analysis of Statement of Financial Position, for the Quarter Ended 30 June 2018 As at 30 June 2018, the Company's total assets, Baht 1,986.7 million, were decreased from Baht 2,012.3 million at the end of 2017. Accounts receivable was increased while the inventory and cash were reduced from the end of 2017. The Company's average periods of trade receivable and inventory held were at 76 days of sales and 47 days of cost of the goods sold, respectively. Total liabilities as at 30 June 2018, Baht 84 million, were increased from those of Baht 72.8 million at end of 2017. The major increase was Accounts payable due to the increase in the billet purchased in Q2 of 2018. The Company's liquidity ratio (Current Assets / Current Liabilities) as at 30 June 2018 was still at a high rate, 14.8 times while the ratio as at 31 December 2017 was at 17.5 times. Moreover, the Company's debt-to-equity ratios as at 30 June 2018 and 31 December 2017 were still low at 0.04. This is mainly due to the use of capital from equity or shareholders instead of long-term debt. This announcement was prepared and disseminated by listed company or issuer through the electronic system which is provided for the purpose of dissemination of the information and related documents of listed company or issuer to the Stock Exchange of Thailand only. The Stock Exchange of Thailand has no responsibility for the correctness and completeness of any statements, figures, reports or opinions contained in this announcement, and has no liability for any losses and damages in any cases. In case you have any inquiries or clarification regarding this announcement, please directly contact listed company or issuer who made this announcement.