13 May 2015
SET-listed motorcycle leasing firm Group Lease Public Company Limited (GL) has reported a record-high net profits of 110.24 million baht for Q1 of 2015 — a colossal jump of more than 900% from the same period last year – on the back of business recovery in Thailand and, more importantly, substantial profit increases from its Cambodian operations.
“This is our best-ever performance on a quarterly basis – and we expect to see even better days ahead,” GL Chairman and Chief Executive Officer Mitsuji Konoshita stated today after the company reported its Q1 2015 audited financial statements to the Stock Exchange of Thailand. Consolidated net profits rose 924% from 10.76 million baht in Q1 last year to 110.24 million baht in Q1 this year.
The single most important factor contributing to the record-high financial results was attributed to GL’s highly successful operations in Cambodia. Of the total Q1-2015 profits, about 39 million baht was from GL’s overseas businesses which represented a 77% increase from the overseas profits in Q4 of 2014. And the bulk of the overseas profits was from GL’s Cambodian operations.
The GL chairman stated that the company’s Cambodian operations are only in the early stage of success and still carry enormous growth potentials in the years to come. GL’s expansion into Cambodia two years ago marked the first important strategic moveh of the company’s corporate roadmap to expand into the relatively-virgin and high-growth markets of CLMV (Cambodia, Laos, Myanmar and Vietnam).
Following on the success of Cambodia, where the company is now expanding into “nano” finance on top of its mainline business of motorcycle leasing, GL is launching new operations in Laos this week after it has received the official license from the Bank of Lao P.D.R., the Lao national bank. An official ceremony to open its new Vientiane headquarters is scheduled for May 15.
“Although Laos has a small population compared to other Southeast Asian countries, it nonetheless carries huge business potentials for us because we will offer leasing and nano-finance services in the rural areas throughout the country where the normal banking services could not reach,” Mr. Konoshita stated. He added that the successful business model that has been developed in Cambodia will now be used for the Lao operations which are expected to take a much shorter period of around 6-7 months to reach the break-even point.
Aside from the significant contributions from the Cambodian operations, the Q1 profits also resulted from higher revenues in the face of lower bad debts. Consolidated hire-purchase interest incomes rose by 129.33 million baht, or 36.54%, from 353.90 million baht in Q1 of 2014 to 483.23 million baht in Q1 this year. Of the increase, some 54.40 million baht was accounted for by the Cambodian operations, which reflected a rapid and continuous business growth there.
Meanwhile, the consolidated provision for bad and doubtful debts decreased from 120.98 million baht to 82.33 million baht over the same period, which largely reflected improved market conditions in the face of the Thai economic recovery while the quality of the Cambodian portfolio remained very good and hence required minimal provisioning.