QH eyes provinces as growth driver

QH eyes provinces as growth driver

SET-listed developer Quality Houses Plc (QH) hopes to lower its debt-to-equity ratio to 1 time by 2016 from 1.29 times now despite scheduling 40 billion baht worth of new residential projects next year.

"Some 70-75% of next year's projects will be detached houses or townhouses, which can generate enough cash flow to pay off current debts and invest in new projects," senior executive vice-president Suwanna Bhuddhaprasart said.

"This will help to ease our debt pressure in 2016."

Residential units are normally ready to be delivered to buyers within a few months, while condominium projects are booked as presales and delivered to buyers once projects are completed in a year or two.

The company's financial report to the SET showed QH's liabilities amounted to 29.5 billion baht as of the third quarter, up from 24.4 billion at the end of last year.

The company's equity for the period was 18.5 billion baht against 17.3 billion reported at the end of 2013.

Ms Suwanna said QH planned to issue debentures worth 4.6 billion baht next year.

QH is also set to launch 30 new residential projects worth a combined 40 billion baht in 2015 to help achieve revenue growth of 20%.

The main growth driver will be upcountry markets, with the revenue contribution from projects outside Greater Bangkok rising to 20% from 15% this year and 9% last year.

The company plans to enter new provinces including Ayutthaya, Phitsanulok and Chachoengsao and is studying the potential of border provinces.

The developer now has 23 projects upcountry, with 10 in Chon Buri province alone. It also has projects in Chiang Mai, Chiang Rai, Rayong, Nakhon Pathom, Cha-am and Hua Hin.

The company has budgeted 8 billion baht to buy new land next year for development in 2016, up from 7.5 billion spent this year.

It expects revenue of 22.5 billion baht this year, outperforming the target of 19.4 billion.

QH shares closed yesterday on the SET at 3.74 baht, down 14 satang, in trade worth 238 million baht.

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