Raimon Land Public Company Limited (“RML” or “the Company”), Thailand’s leading developer of luxury real estate, foresees promising buying power within the luxury condominium market and plans to focus on domestic high-end clients. The company is showcasing the Raimon-iConnect platform to engage virtual property visit, while working on boost property transfer amount from international clients. Overall strategies include releasing remaining property stock, boosting revenue, managing sale and service cost, and retaining cash flow., while the results for Q2/20 achieved revenue of Baht 625.8 million and loss of Baht 130.4 million.
Mr.Lionel Lee, Chief Executive Officers of RML, said, “The overview of the real estate market in the latter half of 2020 is expected to rebound from the first half, bolstered by gradual recovery of the national economy. The property market will still be supported by the government’s policy to reduce ownership transfer fee for home buyers who spend less than 3 million Baht (ending on 24 Dec 2020) and the stimulus marketing campaigns from various developers. Therefore, this could be a good opportunity for clients who are ready to purchase residential property.
Regarding the trend of luxury residential market, the company expects that majority of affluent clients still reflects strong purchasing power. The luxury condominium market priced at Baht 80,000-110,000 per sq.m. was undergoing a mere 2-3 percent reduction of selling price, and it is considered aggressively competitive but not as much as the middle to lower market. Therefore, the luxury market still has potential for purchase and continues to be sold to domestic clients who bought the property as a valued and quality investment. This has been a positive drive for the company to compensate the slowing transfer amount from international clients who are restricted from coming into Thailand.
In the second half of the year, the company strategized to concentrate on domestic high-end clients and redesigning homes under the theme “Design for Living” to add more functionality and mixed-use living spaces. Innovative O2O (Online to Offline) marketing channels including the Raimon-iConnect portal will continue to provide 360-degree virtual tours and access potential clients. The company had invested to facilitate property transfer for international clients. Such strategy will help strengthen relationships with both Thai and international clients and keep the company informed about the amount of transfers being proceeded even during lockdown or travel restriction.
The company will continue to releasing stock of the remaining property inventory and managing cost efficiency to ensure financial stability. It believes that such strategic adjustment will support gradual recovery after this crisis.
In Q2/2020, the company achieved total revenue of Baht 625.8 million, down 29.4% or Baht 261.2 million compared to the same period last year which saw total revenue of Baht 887 million. The company also received a net loss of Baht 130.4 million, down Baht 185.2 million or 338.3% less than the same period last year which had a net profit of Baht 54.7 million.
In Q2/2020, the company achieved presales revenue of Baht 1,322.6 million, grew 241.8 million better year on year. The sharp growth was resulted from Hot Sales promotional campaign in May 2020, in line with the company’s direction to increase revenue and conserve cash flow to ensure stability. The company had been clearing up the private condominium stocks such as The Lofts Asoke, The Diplomat 39, The Diplomat Sathorn, The River and Unixx. The Lofts Silom was also recently completed and starting to have residents moving in. Sales has been focused on The Estelle Phrom Phong, TAIT12, and The Lofts Ratchathewi. Overall, the presales revenue during 1H/2020 was Baht 1,881.2 million, grew 17.3% compared to the same period last year which achieved 1,603.4 million.
During the first 6 months of 2020, the company generated total revenue of Baht 1,049.4 million, a 55.3% reduction worth Baht 1,300.2 million compared to the same period last year which accomplished Baht 2,349.6 million. The company also received a loss of Baht 269.9? million, down 279% or about Baht ?420.7?million compared to the same period last year which achieved a net profit of Baht 150.8 million.
The overall operational results has experienced slower growth due to the reduced total revenue in this quarter was from the high-special revenue in the same period of the previous year in which the Company had income from the gain on sale of land awaiting for development and gain on loss control of investment in a subsidiary for the total of Baht 92 million and other incomes of Baht 88 million which are higher than other incomes in this quarter. The core revenue in this quarter was from sales of real estate of 4?projects The projects are The River, Mews Yen Akat, The Lofts Asoke and The Lofts Silom, a total of Baht 588.9 million, reduced from Baht 685.5 million or 14.1% reduction because The Lofts Silom project which is expected to realize majority income this year has foreigner customers of 49% of total project value, and there is units transfer postponement due to COVID-19 situation with regard to financial unreadiness of some customers affected by economic condition and inconvenience of oversea transaction processes.
The company possessed the total amount of backlog as on 30 June 2020 of Baht 8,379.1 million, comprising 11 projects including TAIT12 30.8%, The Estelle Phrom Phong 26.6%, The Lofts Silom 21.7%, The Lofts Ratchathewi 8%, The Lofts Asoke 7.1%, The River 3.7% and other projects 2.2%.