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Ch Karnchang eyes Bt40 bn annual revenue after 2015

CH KARNCHANG (CK), a listed construction firm, expects to witness up to Bt40 billion in annual revenue after 2015 onwards, above its previous target of Bt30 billion, mostly bolstered by the government's Bt2.4-trillion transport investment plan.

"We are maintaining our projection for new jobs derived from the new infrastructure projects, expecting to bid successfully for 25-30 per cent of their value every year," said chairman and chief executive officer Plew Trivisvaveth.

Up to now, CK has had a strong financial status, reflecting its good performance in construction work for more than four decades. Its shareholders' equity amounts to Bt16.8 billion and it has a backlog of work in hand totalling Bt101 billion.

In the second quarter, the company posted a better operating profit both year on year and compared with the previous quarter. However, consolidated second-quarter net profit declined, mainly because returns on investments from its subsidiaries were incomplete.

For the first six months, CK posted a net profit of Bt677 million on revenue of Bt18.04 billion.

"Now, we have no need to recapitalise, launch any kind of funds, or adjust [sell] investment portfolios, as we just raised funds via a debenture issue worth Bt2.5 billion, which will be sufficient for our working capital," Plew said. He added that this was likely to take its debt-to-equity ratio lower than the current 1.7 times.

CK expects to post better results for the rest of the year thanks to the three new projects worth Bt23 billion that it hopes to win. Two of these are the second phase of a combined-cycle power plant in Bangpa-In Industrial Estate and the Nam Bak dam project in Laos.

Prasert Marittanaporn, senior executive vice president of CK, said all of the company's major construction projects had met their deadlines. Of the ongoing jobs, 70 per cent of the investments are in the Xayaburi hydropower plant and the rest in urban rail projects.

In Greater Bangkok's mass-transit system, the Blue Line extension is 95 per cent completed, the Green Line's south section is 42 per cent completed, and the Purple Line's civil-engineering works are fully completed, Prasert said.

Other major projects include the Xayaburi hydropower project that is 40 per cent completed and the Si Rat Expressway-Bangkok Outer Ring Road project, which is 20 per cent completed.

In regard to the Purple Line project, he said the company via its subsidiary Bangkok Metro, operator of the MRT subway, would acquire 21 three-carriage trains, which were expected to be delivered in the fourth quarter of this year.

"This will mean the Purple Line from Bang Yai to Bang Sue will be in operation earlier than scheduled, in the last quarter of 2016."

As for CK's future strategy, Plew said the company was ready to bid on a wide range of state projects.


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