Message from the chairman
We still determine to operate business to our best performance in line with our corporate vision of “ Charn Issara proud to develop and create sustainable happiness”.
The year 2017 was a year of grief for all Thai people. Although the economic growth figure was higher than that of the year 2016 attributed by the growth of tourism and export but for the real estate business the year was unfortunate with continued sluggish market from the previous year as the result of high household debts and the strict loan policy for middle to low income group of people. The absence of sale promotion event had further hampered the difficult market of real estate although the year’s condition was in favor of buyers to seek bargain residences and resorts.
The Company had a total revenue of Baht 2,317 million consisting of Baht 1,477 million of revenue from property sales, Baht 572 million from hotel operation which was an increase of Baht 41 million from the year 2016, revenue from rental and services of Baht 81 million, and Baht 69 million from consulting and management fees. As of the year end there was a backlog of Baht 1,586 million while the company booked Baht 45 million profit.
In 2017 the Company had speeded up the construction of two hotels, one at Cha Am - Hua Hin and the other at Phangha – Phuket to meet the operational dateline by the 4th quarter. Two other property development for sale were also on acceleration to complete, Baan Issara Bangna and Issara Residence Rama 9. In additions there were 11 residence villas in Thew Talay Estate and 18 pool villas in Baba Beach Club, Phuket received the same attention. Although there was no new project launch but we had started operation for two hotels in past October both of which had an investment in the region of Baht 300-400 million each. The operation of hotels will complement the sales of condominium and villa which are in the same area of those hotels.
It was anticipated that the operation of our two luxury beach clubs will become popular amongst customers and bring about revenue from both room and food & beverages which showed a good trend. We have a plan to inject our new hotel into Sri panwa Hospitality Real Estate Investment Trust in the future and expand the project onto neighboring land adjacent to those two hotels.
Our Company continues to perform well in operating and sell of luxury house and condominium both at Issara Collection Sathorn where construction was completed early in the year with additional sales and Issara Ladprao where only 3 large units (duplex and 3 bedrooms) are left and sold out in the year. ISSI Condo Suksawad which positioned in the middle and low market was well responded but customers had faced home loan application for transfer. Up to 30% of our customers did not get the approval which made it complicate to look after and manage condominium units for this group of customer.
For those large houses at high price, customer normally prefer to wait for the completion of show unit and clubhouse facilities prior to putting up a deposition. However, our houses pre sold well at Issara Residence Rama 9. It is expected that both show units and clubhouse of Baan Issara Bangna will be completed in this coming March and in June for those of Issara Chiangmai which is 6 months behind schedule. When completed, sale is expected to be active for both foreign and Thai customers.
We are currently speeding up works with Junfa in China where over Baht 10,000 million construction of Sri panwa Hotel and Residence at Hainan is in progress. Our Chinese partner expects to start hotel operation in 2019 under Sri panwa brand management. We have received a total of 45 million of consulting fees and next year the Company will start to earn additional revenue from the hotel management agreement.
In summary, although the Company’s operation was not up to our expectation due to the aforementioned factors but our spirit has never faded. We still determine to operate business to our best performance in line with our corporate vision of “ Charn Issara proud to develop and create sustainable happiness”. Finally, I would like to thank all shareholders which is our morale support and has given us confidence all along.
Mrs. Srivara Issara
Charn Issara Development Public Co., Ltd.