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22 May 2020 20:33:00
SET News : Economic slowdown and oil price war bring down Thai listed companies' first-quarter net profit
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                                                       SET News 25/2020
                                       May 22, 2020

Economic slowdown and oil price war bring down Thai listed companies' 
first-quarter net profit

- Q1 total sales down 4.3 pct y-o-y to THB 2.68 trillion
- Net profits fell 60.5 pct y-o-y to THB 98.52 billion during Jan-Mar
- Food & Beverage, Finance & Securities and Packaging sectors reported earnings 

BANGKOK, May 22, 2020 - Securities listed on The Stock Exchange of Thailand 
(SET) recorded total sales of THB 2.68 trillion (approx. USD 83.8 billion) for
the first three months of 2020, down 4.3 percent from the same period of last
year. Their cumulative net profit in Q1 fell by 60.5 percent year-on-year to THB
98.52 billion, with energy and petrochemical businesses suffering from the oil
price war. If not including these two businesses, listed firms' combined net
profit dropped merely 25.2 percent.

SET Senior Executive Vice President Manpong Senanarong said that 671 listed 
securities, accounting for 97.25 percent of the total 690 securities (excluding
those requesting to delay submission of their first quarter financial statement,
property funds, infrastructure funds, non-compliance or NC, and non-performing
groups or NPG) submitted their financial reports, ended March 31, 2020. Among
those securities, 470 securities, representing 70 percent, recorded net profit.

In Q1/2020, SET-listed securities reported total sales of THB 2.68 trillion, a 
4.3 percent decline from a year earlier with core operating profits decreasing
52.6 percent to THB 124.93 billion, and net profit dropping 60.5 percent to THB
98.52 billion. Consequently, the profitability  was down  from the previous
year, with gross profit margin reducing to 18.9 percent from 22.2 percent, core
profit margin decreasing to 4.7 percent from 9.4 percent, and net profit margin
dropping to 3.7 percent from 8.9 percent.

"During the first quarter of 2020, Thai listed securities were impacted by both 
internal and external factors. The global economic slowdown since late 2019 has
caused oil oversupply and triggered the price war among major oil producers. The
securities related to Energy & Utilities, and Petrochemicals & Chemicals
sectors were considerably affected as a result. The economic slowdown made it
difficult for the management of sales and marketing costs, dragging down core
operating profit and net profit when compared to the same period of last year,"
added Manpong.

Due to the performance issue, listed companies sought higher liquidity reserves 
by continuously increasing  debt, making the debt to equity ratio (excluding
Financials industry group) rise up to 1.53 times at the end of the first quarter
 from 1.27 times in the previous year.

However, some sectors performed well and reported growth in both sales and 
profit margin which are Food & Beverage sector, such as fresh food, livestock
and beverage, as well as the Finance & Securities sector's growth via personal
loan, meanwhile, Packaging sector's earnings propelled by lower raw material

mai-listed companies' total sales reported at THB 42.13 billion, a 1.56 percent 
drop year-on-year. The core operating profit was THB 1.46 billion, a 27.5
percent decrease, and net profit was reported at  THB 717 million, 58.58 percent
 down from a year ealier.

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