- Net profit margin rose to 8.95 percent from 6.70 percent a year earlier.
- Lower production costs, recovery of Energy & Utilities, and Petrochemicals and Chemicals sectors boost net profits
Companies listed on The Stock Exchange of Thailand (SET) reported a net profit of THB 909 billion (approx. USD 26 billion) in 2016, a 30.41 percent rise from a year earlier, the highest net profits in five years. This was underpinned by lower production cost and recovery of Energy & Utilities, and Petrochemicals and Chemicals sectors.
Aggregate earnings were compiled from 567 listed firms, or 96.10 percent of the total 590 companies (including property funds, real estate investment trusts and infrastructure funds, and excluding non-compliance and non-performing groups), as of December 31, 2016. There were 461 companies making net profits, representing 81.31 percent of the total listed companies posting their financial statements.
Falling production costs pushed 2016 gross profit up 2.37 percent to THB 2.50 trillion. In addition, the jump of net profit was also supported by neither losses of foreign exchange rates nor impairment, although the overall sales dropped slightly to THB 10.13 trillion due to decreasing sales in the Energy & Utilities and Petrochemicals & Chemicals sectors as a result of a 20 percent fall in crude oil prices in 2016.
Nevertheless, if excluding net profit of companies in Energy & Utilities and Petrochemicals & Chemicals sectors, the sales of listed companies could be seen a 4.15 percent increase in 2016 and net profits could increase by 7.42 percent, compared to the previous year.
Meanwhile, Thai listed firms' ability to generate profit has been growing with their 2016 gross profit margin rising to 24.69 percent from 22.28 percent a year earlier, and net profit margins also increased to 8.95 percent from 6.70 percent, while their debt-to-equity ratio (excluding Financials industry) was at1.19 times, down slightly from 1.20 percent at end-2015.
In quarter 4/2016, the combined net profit was THB 204.85 billion, up 20.15 percent increase from the same quarter of 2015, but down slightly by 1.47 percent from the third quarter of 2016.
SET Senior Executive Vice President Santi Kiranand said, "The overall performance of the Thai listed companies in 2016 has improved corresponding to the growing domestic consumption. The business sectors that could benefit most from the government policies were Property Development, Construction Materials, Commerce, and Healthcare sectors. Interestingly, companies in 10 target industrial groups from the "Thailand 4.0" economic policy, the government economic model, reported healthy performance with a 20 percent net profit growth, compared to end-2015.
The companies listed on Market for Alternative Investment (mai) also reported the 2016 net profit, a 8.73percent year-on-year drop to THB 3.89 billion, partly due to extra items booked. As for Q4/2016, theyreported a net loss of THB 472 million, compared to THB 233 million loss in the same period a year earlier."