News Detail

Date/Time
27 May 2020 17:53:00
Headline
Management Discussion and Analysis Yearly Ending 31 Mar 2020
Symbol
TMW
Source
TMW
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                Management Discussion and Analysis

Company name                             : THAI MITSUWA PUBLIC COMPANY LIMITED
Year                                     : 2019
Quarter                                  : Yearly
Ending                                   : 31-Mar-2020
Note                                     :
 
To    :  President  of  SET
From       :  Thai Mitsuwa Public Company Limited
Date        :  May 27,  2020
Subject     :  Operation  results  for the year ended March 31,2020 compared with 
the year ended March 31,2019     
    
           Thai  Mitsuwa  Public Company  Limited   has summarized the operating  
results  for the year ended March 31,2020  compared  with the year ended  March
 31, 2019 as follows :
                                                                   (unit : thousand)                                  
Income Statement    2019    %    2018    %    Year 2018 /17
Revenues  from sales         2,910,867     100.0%      3,275,699     100.0%    -11.1%
Other income            16,941    0.6%           19,735    0.6%    -14.2%
Total revenue        2,927,808     100.6%      3,295,434     100.6%    -11.2%
Cost of  the sales        2,345,392     80.6%      2,586,420     79.0%    -9.3%
Gross profit          565,475     19.4%         689,280     21.0%    -18.0%
Administrative & selling  expenses          300,487     10.3%         276,204     8.4%    8.8%
Finance cost              6,987     0.2%             8,282     0.3%    -15.6%
Total expenses  before income taxes        2,652,867     91.1%      2,870,906 
    87.6%    -7.6%
Profit before income taxes          274,941     9.4%         424,528     13.0%    -35.2%
Income tax expenses            39,294     1.3%           53,915     1.6%    -27.1%
Profit for the year          235,648     8.1%         370,613     11.3%    -36.4%

Revenue - Cost of  Sales -  Gross Profit
                                                 (unit : thousand)
Items    2019    %    2018    %    Change
Revenue from sale  -  Plastic parts    1,807,559    100.0%    2,009,966    100.0%    -10.1%
Revenue from sale -  Magnesium  parts    953,263    100.0%    1,137,333    100.0%    -16.2%
Revenue from sale  -  Mold    150,045    100.0%    128,400    100.0%    16.9%
   Total revenues    2,910,867    100.0%    3,275,699    100.0%    -11.1%
Cost of sale  -  Plastic parts    1,448,991    80.2%    1,611,645    80.2%    -10.1%
Cost of sale  - Magnesium  parts    799,511    83.9%    892,153    78.4%    -10.4%
Cost of sale  - Mold    96,890    64.6%    82,622    64.3%    17.3%
   Total cost of sale    2,345,392    80.6%    2,586,420    79.0%    -9.3%
Gross profit  - Plastic parts    358,568    19.8%    398,321    19.8%    -10.0%
Gross profit  - Magnesium parts    153,752    16.1%    245,180    21.6%    -37.3%
Gross profit - Mold    53,155    35.4%    45,778    35.7%    16.1%
   Total gross profit    565,475    19.4%    689,279    21.0%    -18.0%

Revenue  Structure
Business Segments    2019    %      2018     %      Year 2018/17
Plastic parts    1,807,559    62.10%    2,009,966    61.40%    -10.10%
Magnesium parts    953,263    32.70%    1,137,333    34.70%    -16.20%
Mold    150,045    5.20%    128,400    3.90%    16.90%
   Total revenue from sale    2,910,867    100.00%    3,275,699    100.00%    -11.10%
                                                     (unit  : thousand)    

Cost-of-sales  Structure
                                                    (unit  : thousand)
Business Segments    2019    %     2018    %    Year 2018/17
Plastic parts    1,448,991    61.80%    1,611,645    62.30%    -10.10%
Magnesium parts    799,511    34.10%    892,153    34.50%    -10.40%
Mold    96,890    4.10%    82,622    3.20%    17.30%
   Total cost of sales    2,345,392    100.00%    2,586,420    100.00%    -9.30%

Gross Profit  Structure    
                                (unit  : thousand)
Business Segments    2019    %     2018    %    Year 2018/17
Plastic parts    358,568    63.4%    398,321    57.8%    -10.0%
Magnesium parts    153,752    27.2%    245,180    35.6%    -37.3%
Mold    53,155    9.4%    45,778    6.6%    16.1%
 Total gross profit    565,475    100.0%    689,279    100.0%    -18.0%
    

In the year 2019, the company's operating results from 1 April 2019  to 31 March
 2020
    The company has sales revenue of 2,910.9 million baht, a decrease of 11.1%. The
cost of sales is 2,345.4 million baht, a decrease of 9.3%, with approximately
80% of total sales. The important  items in cost of sales other than raw
materials are depreciation and amortization of 242 million baht,
employee-related expenses 511.1 million baht and energy costs 133.4 million
baht,  totaling  886.5 million baht, accounting for 37.8% of the total cost of
sales. Gross  profit of 565.5 million baht decrease by 18% with  the gross
profit margin 20% of total sales, The  expenses before income tax of 2,652.9
million baht  decrease by 7.6%  with  approximately 91% of total sales.
    When considering the numbers in the Revenue - Cost of sales - Gross profit 
shown above for the year 2019 and 2018 are as follows :
    Plastic parts sales of 1,807.5 million baht decrease by 10.1% with  62.1% of 
total sales, accounting for the  domestic sales of 1,773.9 million baht and the
export sales of 33.6 million baht.
    Sales of magnesium parts 953.3 million baht   decrease by 16.2%  with  32.7% of
total sales, accounting for the domestic sales 660.2 million baht and the
export sales of 293.1 million baht because the customers have delayed orders in
both plastic parts and magnesium parts for cameras.
    Mold sales of 150 million baht  increase by 16.9% with 5.2% of total sales, 
accounting for the sales of Pathum Thani factory 103.5 million baht  and the
sales of Nakhon Ratchasima factory 46.5 million baht.
    The cost of plastic parts sales  of 1,489 million baht  decrease by 10.1% with 
 80.2% of the sales of plastic parts and  61.8% of the total cost of sales.
    The cost of magnesium parts sales of 799.5 million baht  decrease by 10.4%  
with 83.9% of the sales of magnesium parts and 34.1% of the total cost of sales.
    The cost of molded parts sales of 96.9 million baht  decrease by  17.3%  with  
64.6% of mold sales and 4.1% of the total cost of sales.
    Gross profit of plastic parts of 358.6 million baht  decrease by  10%  with 
19.8% of sales of plastic parts and 63.4% of total gross profit.
    Gross profit of magnesium parts of 153.7 million baht decrease by 37.3% with 
16.1% of sales of magnesium parts and 9.4% of total gross profit.
    Gross profit of mold of 53.2 million baht  increase by 16.1%. with 35.4% of 
sales of magnesium parts and 9.4% of total gross profit.
    Selling expenses of 64 million baht  include important items, which were staff 
expenses 24.4 million baht, transportation goods cost 23.2 million baht and
export freight 8.5 million baht, total 56 million baht, which is approximately
87.5% of the cost of sales
      Administrative expenses of  236.5 million baht include important items such 
as employee expenses 143.7 million baht and depreciation of buildings and
equipment 19.7 million baht which is approximately the ratio of 69% of
administrative expenses.
    Financial expenses of  7 million baht  decrease  15.6%, which was interest 
expenses under finance lease agreements relating to machinery and equipment.
    As in the operating results for the year ended 31 March 2020 for the fourth 
quarter of the company From January 1, 2020 to March 31, 2020, the company has
been affected by the epidemic of the coronavirus disease 2019 or Coronavirus
Disease 2019 (COVID-19)}. The customers have delayed their orders, which have
continued  from the third quarter of the company from October 1, 2019 to
December 31, 2019, which has already been affected by the global economic
slowdown, causing the company to have to adjust the production process in some
parts of the factory and the operating time of the employees to be in accordance
with such situation in order to help reduce the production cost and reduce
other operating expenses such as labor and electricity cost etc.
    The company's net profit  decreases by 36.4% from the previous year but the 
company has its cash flow from operating activities 483.3 million baht, higher
than last year by 12.3 million baht, net cash and cash equivalents increased by
74.7 million baht.
    Liquidity -  current ratio 1.8 times and  quick ratio 1.4 times while   cash 
cycle  1 day  implies that the  sales period plus debt collection period is 1
day longer than debt repayment period (year before the debt repayment period is
longer than sales and debt collection period 11 days).
    Profitability - net profit margin 8% (last year 11%) Return on total assets 7% 
(last year 12%) and turnover of fixed assets 12% (last year 23%).
    The ability to pay off debt - the debt to equity ratio of 0.4 times (last year 
0.3 times) and the ability to pay interest 76 times higher than the previous
year at 64 times due to the increased cash flow from operations and the reduced
interest expenses according to the finance leases agreements.
    From  the events  and the financial ratios said above, the company needs to 
manage cash flow in and out of the operations more carefully and more cautiously
 under the unstable situations that exist.            
    For the effect on the financial statements of the company due to this 
situation, The Federation of Accounting Professions has announced the
Notification of the Federation of Accounting Professions No. 16/2563 on April
16, 2020 which was announced in the Royal Gazette on April 22,2020 regarding
temporary relief measures for accounting alternatives to cope with the impact of
the coronary epidemic in 2019 (COVID-19. ) as a guideline for additional
accounting alternatives for the preparation of financial statements affected by
the COVID-19 situation with a reporting period ending in the period between 1
January 2020 to 31 December 2020, annexed with the detailed information in the
notes to the financial statements no. 1.2 and no. 3.3.    

                    Signature
                                                                        (Mr.Tetsuji  
Takeguchi)
Accounting and  Finance  Manager
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