Central Pattana PLC
Management's Discussion and Analysis (MD&A) 1Q25
EXECUTIVE SUMMARY
In 1Q25, domestic consumption in Thailand was primarily driven by the government's "Easy E-Receipt 2.0" program, which was effective from January 16 to February 28, 2025. The program allowed shoppers to claim personal income tax deductions on eligible purchase (Bt30,000 from VAT-registered businesses and Bt20,000 from OTOP businesses, all of which need to be able to issue electronic receipts). In April 2025, there were also initiatives to support the property business namely 1) Bank of Thailand's temporary relaxation of the Loan-to-Value regulations on housing loans and 2) Reduction in transfer and mortgage fees. Effective from May 1, 2025, to June 30, 2026, banks can grant housing loans up to 100% of the collateral value for all residential properties, easing previous restrictions for second and third homes. Moreover, the property ownership transfer fee has been reduced from 2% to 0.01% and the mortgage registration fee has been reduced from 1% to 0.01%. Such transaction costs reduction applies to properties priced at Bt7mn or lower and have been effective from April 9, 2025 - June 30, 2026.
On 2025 outlook, the Office of the National Economic and Social Development Council (NESDC) expects Thai economic growth to accelerate to 2.8%YoY. Key supporting factors for economic growth in 2025 include: (1) increasing government expenditure, particularly investment spending; (2) continued expansion of private consumption and recovery of private investment; (3) sustained recovery of the tourism sector and related services; and (4) continual growth of merchandise exports. Private consumption expenditure and investment are forecasted to grow 3.3%YoY in 2025, which was an upward revision from the previous forecast of 3.0%YoY, thanks to robust labour market and mild inflation. However, there have been revisions on 2025 Thai GDP growth forecasts, most recently from the Fiscal Policy Office (FPO). The FPO revised 2025 GDP growth from 3.0%YoY to 2.1%YoY but kept domestic consumption growth forecast similar to the previous forecast at 3.2%YoY.
In terms of CPN's performance, the Company continued to deliver solid performance from the retail and hotel businesses, with all-time-high overall gross profit margin as well as rental business' gross profit margin in 1Q25. Centara and Go! Hotels' performance consistently improved and low-rise transfers still grew 10% YoY despite challenging market. Other key performance drivers include 1) solid same-store rental revenue growth thanks to buoyant growth of tenants' sales from holistic partnership solution for tenants, ongoing events and activities in shopping centers, and new experience for shoppers; 2) efficiency enhancement initiatives including solar rooftop installations and lower temperature compared to 1Q24; and 3) continued improvement in net D/E ratio. CPN reported 1Q25 revenues of Bt12,162mn, similar to 1Q24 level, and net profit after minority interests of Bt4,227mn, increasing 2%YoY. Excluding the after-tax impact of Bt380mn from investment income in relation to pending Rama 2 lease payment from CPNREIT, 1Q25 core profit was Bt3,847mn, growing 1% YoY. Compared to 4Q24, core profit was slightly lower by 4%QoQ, mainly due to lower residential transfer during 1Q25.
On new developments in 1Q25, Central Pattana opened 1 new community mall and launched 1 low-rise project in late March. The new community mall, Market Place Theprak, is the new model that combines community mall with the fresh market with total area of approximately 7,000 sqm and opening occupancy of closed to 90%. The low-rise project launched during the quarter was BAAN NIRATI CHAENGWATTANA-CHAIYAPHRUEK, of which the project value is Bt1,720mn.
OVERVIEWThe Company has 4 business units under its management:
Rental and services (retail, food court, office).
Hotels, and
Residential properties for sale
Besides the above businesses, the Company also manages properties, which have been transferred to CPN Retail Growth Leasehold REIT ("CPNREIT"), CPN Commercial Growth property fund ("CPNCG") as well as properties under the management of Grand Canal Land PLC ("GLAND"), Company's subsidiary.
Assets under Central Pattana as at 1Q25Business Type | Total | CPN | CPNREIT | CPNCG | ||||
No. | '000 sqm | No. | '000 sqm | No. | '000 sqm | No. | '000 sqm | |
Shopping Mall Shopping malls in Bangkok Shopping malls in provinces Shopping mall in overseas Mega Bangna Total Shopping Mall | 17 23 1 1 42 | 930 926 84 169 2,109 | ||||||
17 23 1 1 42 | 778 825 84 169 1,857 | 3 4 7 | 152 100 253 | |||||
Community Mall | 16 | 167 | 15 | 167 | ||||
Total Retail Business | 58 | 2,277 | ||||||
Other Business Office Hotel Residential for sales - active (high-rise) Residential for sales - active (low-rise) | 7 10 14 14 | 170 1,681 rooms | 4 9 | 53 1,377 rooms | 2 1 | 34 304 rooms | 1 | 82 |
Assets under GLAND Office Residential for sales - active (low-rise) | 3 1 | 145 | 1 | 68 | 2 | 77 | ||
The Company has 42 shopping malls (17 in the Bangkok Metropolitan area, 23 upcountry, 1 overseas, Mega Bangna), 16 community malls with a total NLA of 2.3 mn sqm. The Company's 1Q25 occupancy rate of shopping mall and community malls slightly improved from 4Q24 to 92% in 1Q25, mainly from the improvement of new malls opened since late 2023 and 2024: Central Westville, Central Nakhon Sawan and Central Nakhon Pathom.
The Company has 10 office buildings for rent with a total rental area of 314,656 sqm. The occupancy rate in 1Q25 was at 89%, slightly improved from the previous quarter, thanks to the full quarter impact of improved occupancy at Unilever House and The Ninth Towers.
In 1Q25, the Company has a total of 10 hotels and 1,681 rooms with an average occupancy rate of 76%, consistently improving from previous quarter and previous year, mainly from Centara and Go! hotels.
The Company launched 1 low-rise project, which is BAAN NIRATI CHAENGWATTANA-CHAIYAPHRUEK in 1Q25, bringing total active projects to 29 (14 condominiums and 15 low-rise) at the end of 1Q25.
FINANCIAL PERFORMANCE 1Q25 Profit & Loss Statement reconciliation between F/S and core performanceUnit: Baht mn | Per F/S | Impact from Rama 2 lease extension with CPNREIT | Core Performance |
Revenue from rental & services | 10,792 | - | 10,792 |
Revenue from other businesses | 1,130 | - | 1,130 |
Other income | 240 | - | 240 |
Total Revenue | 12,162 | - | 12,162 |
Cost of rental & services | (4,306) | - | (4,306) |
Cost of other businesses | (571) | - | (571) |
Administrative expense | (2,048) | - | (2,048) |
Operating profit (loss) | 5,236 | - | 5,236 |
Share of profit from invested co. | 522 | - | 522 |
Investment income | 506 | (475) | 31 |
Interest expense | (883) | - | (883) |
Income tax | (1,076) | 95 | (981) |
Minority interest | (78) | - | (78) |
Net profit to parent co. | 4,227 | (380) | 3,847 |
1Q25 Non-recurring item
The Company recognized lease receivable from financial lease with CPNREIT in 1Q20 which reflects the present value at that time. The Company will record accrued interest income until 2025 when the cash payment will be made. As such, the lease receivable will become equivalent to the actual cash receipt on the actual transaction date in 2025. In 1Q25, the Company recognized an interest income from the Central Rama 2 lease contract amounting to Bt380mn (after tax).
The following management discussion excludes an impact of non-operating item as mentioned above to the Company's best ability to reflect the financial performance based on actual business events, which may differ from the financial statements reviewed and/or audited by the auditors authorized by the Securities and Exchange Commission of Thailand (SEC).
Profit & Loss Statement (Baht mn) | 1Q24 | 4Q24 | 1Q25 | YoY (%) | QoQ (%) |
Revenue from rental & services (Retail, Food Court, Office) | 9,908 | 10,834 | 10,792 | 9% | (0%) |
Revenue from Hotel Business | 491 | 550 | 528 | 8% | (4%) |
Revenue from Residential Business | 1,306 | 1,976 | 602 | (54%) | (70%) |
Other Income | 529 | 550 | 240 | (55%) | (56%) |
Total Revenue | 12,234 | 13,910 | 12,162 | (1%) | (13%) |
Cost of Rental and Service Income | 4,331 | 4,527 | 4,306 | (1%) | (5%) |
Cost of Hotel Business | 155 | 183 | 171 | 10% | (6%) |
Cost of Residential Business | 822 | 1,366 | 400 | (51%) | (71%) |
Total Cost | 5,308 | 6,076 | 4,878 | (8%) | (20%) |
Administrative Expenses (incl. impact from TFRS9) | 1,996 | 2,775 | 2,048 | 3% | (26%) |
Operating Profit | 4,930 | 5,059 | 5,236 | 6% | 3% |
Net Finance Cost/Income Tax/Others | (722) | (1,108) | (931) | 29% | (16%) |
Profit to Non-Controling Interest | (54) | (58) | (78) | 45% | 34% |
Profit to Parent Company | 4,154 | 3,893 | 4,227 | 2% | 9% |
Profit to Parent Company (excl. non-recurring items) | 3,806 | 4,011 | 3,847 | 1% | (4%) |
EPS to Parent Company | 0.93 | 0.87 | 0.94 | 2% | 9% |
EPS to Parent Company (excl. non-recurring items) | 0.85 | 0.89 | 0.86 | 1% | (4%) |
Total Revenue
In 1Q25, the Company has total revenue of Bt12,162mn, which was similar to 1Q24 level but lower 13%QoQ mainly from the condominium transfer schedule with some seasonality impact from retail and hotel businesses. Details of each component are as follows:
Rental & Service business reported revenues similar to 4Q24 level, which was at all-time-high, of Bt10,792mn. The YoY increase of 9% was mainly from strong same-store rental revenue growth and amortization of Pinklao lease extension with CPNREIT which has been effective since 2Q24.
Hotel business recorded 1Q25 revenue of Bt528mn, growing 8%YoY but slightly lower 4%QoQ due to seasonality effect. The improvement was mainly from Centara and Go!, of which RevPar improved by 26% and 33% YoY, respectively. Overall occupancy was 76% in 1Q25, consistently improving QoQ from 73% in 4Q24 and YoY from 67% in 1Q24.
Residential for sale business reported 1Q25 revenue of Bt602mn, decreasing 54% YoY and 70%QoQ. The change in 1Q25 was mainly due to the condominium transfer schedule, however low-rise transfer still increased 10%YoY. With the supporting measures (LTV relaxation and lower transaction costs) effective since 2Q25, we expect better transfer momentum in the following quarters.
Other income in 1Q25 was Bt240mn, decreasing 55%YoY and 56%QoQ mainly unrealized FX gain/loss from overseas operation and other investments.
Gross profit
The Company's 1Q25 gross profit was Bt7,043mn, increasing 10%YoY, mainly from record-high rental and overall gross profit margin. Compared to 4Q24, gross profit was slightly lower 3%QoQ, which was better than the revenue trend from improving gross profit margin of the residential business. The Company
continued to deliver all-time-high overall gross profit margin in 1Q25 of 59%, mainly from strong retail business performance and QoQ improvement of residential gross profit margin (4Q24 55%; 1Q24 55%).
Operating profit
1Q25 operating profit was Bt5,236mn growing 6% YoY and 3% QoQ with operating profit margin of 43% (4Q24 37% and 1Q24 40%). The QoQ improvement was mainly from seasonally higher marketing expenses during festive season in 4Q24. However, the YoY increase was slightly lower than gross profit movement mainly from the drop in other income from unrealized FX gain recorded in 1Q24. (SG&A to total revenues ratio was 17% in 1Q25 and 20% in 4Q24).
Net profit
The Company delivered 1Q25 core net profit of Bt3,847mn, increasing 1% YoY but lower 4% QoQ. The YoY increase was lower than operating profit increase as share of profit from Grab Thailand is no longer recorded since 1Q25. The QoQ change was in line with operating profit with 1Q25 net profit margin of 32% (4Q24 29%; 4Q23 31%).
CAPITAL STRUCTUREAt the end of 1Q25, the Company reported an interest-bearing debt from financial institution (excluding loans from related parties) of Bt67,509mn, lower than 4Q24 level of Bt68,875, due to repayments during the quarter. As a result, total net interest-bearing debt to equity further decreased from 0.58x in 4Q24 to 0.53x. The weighted average interest rate in 1Q25 was 3.04%, similar to 4Q24 level at 3.05%. The Company further solidify its financial position with an interest coverage ratio at 23.80x in 1Q25 (interest expense excludes impact from TFRS16).
Statement of Financial Position (Baht mn) | End 1Q24 | End 4Q24 | End 1Q25 | YoY (%) | QoQ (%) |
Current assets | |||||
Cash, cash equivalents and financial investments | 5,541 | 5,292 | 7,602 | 37% | 44% |
Trade accounts receivable | 2,034 | 1,404 | 1,413 | (31%) | 1% |
Other current assets | 18,724 | 32,054 | 33,372 | 78% | 4% |
Total current assets | 26,298 | 38,751 | 42,387 | 61% | 9% |
Non-current assets | |||||
Investment properties | 182,319 | 186,641 | 187,063 | 3% | 0% |
Property & equipment (PP&E) | 4,779 | 4,857 | 4,788 | 0% | (1%) |
Other non-current assets | 80,156 | 73,966 | 74,722 | (7%) | 1% |
Total non-current assets | 267,254 | 265,464 | 266,573 | (0%) | 0% |
Total assets | 293,552 | 304,215 | 308,960 | 5% | 2% |
Current liabilities | |||||
Interest-bearing debt - 1 year | 27,183 | 17,326 | 18,919 | (30%) | 9% |
Other current liabilities | 17,882 | 20,766 | 23,264 | 30% | 12% |
Total current liabilities | 45,065 | 38,092 | 42,183 | (6%) | 11% |
Non-current liabilities | |||||
Interest-bearing debt | 46,106 | 51,550 | 48,589 | 5% | (6%) |
Other non-current liabilities | 97,427 | 104,744 | 104,428 | 7% | (0%) |
Total non-current liabilities | 143,533 | 156,294 | 153,017 | 7% | (2%) |
Total liabilities | 188,598 | 194,386 | 195,200 | 4% | 0% |
Shareholders' equity | |||||
Retained earnings - unappropriated | 96,617 | 100,582 | 104,512 | 8% | 4% |
Other shareholers' equity | 8,338 | 9,247 | 9,247 | 11% | 0% |
Total shareholders' equity | 104,955 | 109,829 | 113,760 | 8% | 4% |
Total liabilities and equity | 293,552 | 304,215 | 308,960 | 5% | 2% |
Financial Ratio | 1Q24 | 4Q24 | 1Q25 | YoY (Chg) | QoQ (Chg) |
Profitability Ratio | |||||
Gross profit margin | 54.6% | 54.5% | 59.1% | 4.4% | 4.6% |
Rental and Service Business (Retail, Food Court, Office) | 56.3% | 58.2% | 60.1% | 3.8% | 1.9% |
Hotel Business | 68.3% | 66.8% | 67.5% | (0.8%) | 0.7% |
Real Estate Business | 37.1% | 30.9% | 33.5% | (3.6%) | 2.6% |
Operation profit margin | 40.3% | 36.5% | 43.1% | 2.8% | 6.5% |
Net profit margin | 34.0% | 28.1% | 34.8% | 0.8% | 6.6% |
Excluding non-recurring and non-operating items | 31.1% | 29.0% | 31.6% | 0.5% | 2.7% |
Return on equity | 16.6% | 16.6% | 16.1% | (0.5%) | (0.6%) |
Excluding non-recurring and non-operating items | 15.3% | 15.5% | 15.0% | (0.4%) | (0.5%) |
Efficiency Ratio | |||||
Return on assets | 5.4% | 5.5% | 5.4% | 0.0% | 0.0% |
Excluding non-recurring and non-operating items | 5.0% | 5.1% | 5.1% | 0.0% | 0.0% |
Liquidity Ratio | |||||
Current ratio (times) | 0.58 | 1.02 | 1.00 | 0.42 | (0.01) |
Quick ratio (times) | 0.17 | 0.18 | 0.21 | 0.05 | 0.04 |
Financial Policy Ratio | |||||
Liabilities to equity ratio (times) | 1.80 | 1.77 | 1.72 | (0.08) | (0.05) |
Net interest-bearing debt to equity (times) | 0.66 | 0.58 | 0.53 | (0.13) | (0.05) |
Interest Coverage Ratio (times) | 18.87 | 22.91 | 23.80 | 4.93 | 0.90 |
*Interest Exp excl. impact from TFRS16
Summary of future projects under construction Retail and Mixed-use ProjectsProject | Type | Expected | Details | |
1 | Market Place Theprak | Community Mall | Opened 28 Mar-2025 | NLA 5,200 sqm |
2 | DUSIT CENTRAL PARK | Mixed-use Project | ||
- Dusit Thani BANGKOK | ownership 30% | Opened Sep-2024 | 257 Rooms | |
- CENTRAL PARK | ownership 85% | 2H25 | GLA 45,000 sqm | |
- CENTRAL PARK OFFICES | ownership 100% | 2H25 | GLA 60,000 sqm | |
- DUSIT RESIDENCES | ownership 30% | 2026 | 400 units | |
3 | Central Krabi | Shopping Mall | 4Q25 | NLA 22,000 sqm |
4 | Central Northville | Shopping Mall | 2Q26 | GBA 210,000 sqm |
5 | Central Khonkaen Campus | Shopping Mall | 2Q26 | GFA 45,000 sqm |
6 | Central Phuket - New Luxury Zone Expansion | Shopping Mall | 3Q26 | GBA 20,000 sqm |
7 | The Central | Shopping Mall | 4Q26 | GLA 152,000 sqm |
Hight-Rise Projects | Launched | Transfer | Project Value (bn Baht) | Total No. of Units | |
1 | PHYLL PHAHOL 34 | Sep-18 | Nov-19 | 1.30 | 358 |
2 | ESCENT RAYONG II | Dec-20 | Nov-22 | 0.93 | 420 |
3 | ESCENT VILLE SURATTHANI | Aug-22 | 2024 | 1.11 | 459 |
4 | ESCENT VILLE SUPHANBURI | Oct-22 | May-24 | 0.70 | 328 |
5 | ESCENT VILLE CHACHOENGSAO | Oct-22 | Apr-24 | 0.66 | 362 |
6 | ESCENT TRANG | Dec-22 | 2024 | 0.88 | 378 |
7 | ESCENT PHETCHABURI | Jun-23 | 2025 | 0.45 | 196 |
8 | ESCENT NAKHON SAWAN | Jan-24 | 2025 | 1.15 | 442 |
9 | ESCENT NAKHON PATHOM | Mar-24 | 2026 | 1.07 | 425 |
10 | ESCENT BANGNA | Jun-24 | 2026 | 0.71 | 285 |
11 | ESCENT HATYAI II | Sep-24 | 2026 | 1.76 | 662 |
12 | ESCENT PHUKET | Sep-24 | 2026 | 1.46 | 513 |
13 | ESCENT UBONRATCHATHANEE 2 | Nov-24 | 2026 | 1.11 | 411 |
14 | ESCENT NAKORN SRI | Dec-24 | 2026 | 1.26 | 459 |
Low-Rise Projects | Launched | Transferred | Project Value (bn Baht) | Total No. of Units | |
1 | NIYHAM BOROMRATCHACHONNANI | Nov-18 | Feb-19 | 2.17 | 71 |
2 | ESCENT TOWN PHITSANULOK | Dec-19 | Mar-20 | 0.93 | 243 |
3 | NIRATI CHIANGRAI | Sep-20 | Oct-20 | 0.78 | 158 |
4 | NIRATI BANGNA | Oct-20 | Nov-20 | 1.21 | 153 |
5 | NIRATI DON MUEANG | Sep-21 | Oct-21 | 1.93 | 248 |
6 | ESCENT AVENUE RAYONG | Nov-21 | Jun-22 | 0.47 | 63 |
7 | BAAN NIRATI CHIANGMAI | Nov-22 | Dec-22 | 1.63 | 179 |
8 | BAAN NINYA RATCHAPHRUEK | Dec-22 | Mar-22 | 1.61 | 132 |
9 | BAAN NIRATI NAKHON SI | Aug-23 | Sep-23 | 0.71 | 79 |
10 | BAAN NIRADA RAMA 2 | Oct-23 | Jun-24 | 2.96 | 110 |
11 | BAAN NIRADA UTHAYAN-AKSA | Dec-23 | Apr-24 | 2.36 | 96 |
12 | BAAN NIRADA WONGWAN-EKKACHAI | Jan-24 | Apr-24 | 1.63 | 72 |
13 | BAAN NIRATI NAKORNPATHOM | Oct-24 | Dec-24 | 1.02 | 124 |
14 | BAAN NIRADA SRIVAREE BANGNA | Nov-24 | Dec-24 | 2.50 | 228 |
15 | BAAN NIRATI CHAENGWATTANA CHAIYAPHRUEK | Mar-25 | Y2025 | 1.72 | 119 |