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CONTENT Message from the Board of Directors 02 Financial Information 04 11 Nature of Company and Subsidiaries Information 05 Business Nature of Business 11 Management Structure 26 Organization Chart 40 Boards of Directors 42 Business Policy and Overview 44 Project’s Information 46 44 Map 55 Business Policy and Overview Products and Service 56 Competition 73 Securities and Shareholder 77 Management 87 Details of Position 97 Remuneration 98 46 Governance 100 Project Information Connected Transactions 107 Risk Factors 134 Internal Control 141 Corporate Social Responsibility 145 Management Dicussion and Analysis 160 Report of Independent Auditor 205 73 Competition Statement of Financial Position 206 Note to consolidated 216 The Board of Directors' Responsibilities 267 Audit Committee Report 268 Audit Fee Accuracy 270 Investors can obtain additional information on securities issuers in the Company’s Form 56-1 onwww.sec.or.th or the Company’s website. ANNUAL REPORT 2014 MESSAGE FROM THE BOARD OF DIRECTORS DR.TAWATCHAI NAKHATA CHAIRMAN Throughout 2014, Thailand’s economy had been affected and tended to rise further. by political instability erupting in the fourth quarter of 2013. Though the instability eased, uncertainties remained. Low- The Board of Directors’ policy was to further strengthen income earners’ purchasing power was weak, driven by high the Company in terms of revenue and financial strengths. household debt and falling farmers’ low income, while the The debt to equity ratio was lowered to cut interest expenses. upper middle-income were cautious of spending. This resulted The land bank was turned into revenue more quickly, as some in lower-than-expected growth rate in the real estate market, land plots were developed and others not included in the but it is recovering slowly. Developers gradually launched development plan were sold. The ISO 9001 standards were projects in areas which would benefit from Bangkok’s adopted to improve product quality, with the focus on design urbanization but delayed projects in provinces pending for and construction management, to satisfy customers’ demand. clarity of government projects. Residential demand expanded A major milestone was when shareholders at the 2013 annual more slowly than expected as most buyers awaited clarity in meeting approved the acquisition of Thai Property Public economic recovery in 2015. Financial institutions maintained Company Limited (TPROP) and Grand Asset Public Company the strict lending policy, leading to an increase in the rejection Limited (GRAND). Once the acquisition is complete, the rate from 15-20% to 30-40%. Company’s financial condition would be strengthened. It is estimated that the Company’s assets and shareholders’ equity In the year, the Company’s total sales rose 13% to would rise to Bt43,400 million and Bt16,400 million, Bt11,982 million. Sales of single houses and townhouses respectively. The Company would also earn more revenue contributed 57%, while that of condominium 43%. Sale from office for rent and hotel business and enjoy lower revenue from single houses, townhouses and condominium dependence on a particular business. The assets and revenue expanded 12% on year to Bt10,011 million. The growth rate structure would be more diversified – to cover low-rise of the condominium segment alone was 40%, thanks to the development, condominium projects, city condominiums, realization of revenue from 9 projects against 5 projects in office for rents and hotel business. the 2013. The Company also earned Bt1,629 million from land sale and Bt845 million from the hotel business. This In 2015, the Board of Directors maintains the policy to pushed total revenue to Bt12,416 million, or an increase of further grow revenue and profitability and strengthen the 27% from 2013. The sale of the Company’s stake in Krungthep Company’s business base. The project launch will be Land Public Company Limited worth Bt720 million generated quickened to extend the revenue realization period and selling a gain of Bt77 million. As profitability rose on an increase in period. The focus is placed on high-end products under revenue, the net profit margin rose to 3.2% from 0.4% in 2013 “Perfect Masterpiece” brand, to limit negative impacts from 02 MR.CHAINID ADHYANASAKUL CHIEF EXECUTIVE OFFICER low purchasing power amid high household debt. Six projects Once the acquisition of TPROP is complete potentially are planned with combined value of Bt9,000 million. The in June 2015 with the success of buying at least 75% of the construction cost will be lowered through the central company’s outstanding shares, the Board of Directors and procurement unit, to increase the bargaining power. The the management are set to further enhance business potential. corporate image will be refreshed to mark the 30th anniversary, In the next two years, the Company plans to develop and sell under the “New Era of Happy Living” concept. The “Eco Cool” TPROP and GRAND’s current projects and use the proceeds housing concept, a modern, comfortable, energy-saving and to develop new projects. A real estate investment trust will environmental-friendly innovation, will be launched. This will be established for Metro West Town and Metro East Town, be achieved through solar-powered cooling and heat-releasing the two shopping malls which are valued at Bt1,800 million. technology and energy-saving and green materials. Vertical A fund will also be established for the hotel business, to trees and lath will be used to shield the houses from heat. include Kiroro Resort in Japan, Sheraton Hua Hin Resort and The houses will be equipped with the home monitoring system, Spa, and Sheraton Hua Hin Pranburi worth Bt3,700 million. with high-speed-internet-controlled CCTV for greater protection. The “Green@Heart” concept will highlight the The Board of Directors wishes to thank shareholders, Company’s long-standing focus, to extend green areas. New valued customers, investors, business partners, alliances and functions will be added in clubs, like a sky pool, green bike financial institutions for their long-standing supports to the lane, solar-powered park and free Wi-Fi service. Company., as well as the management and all employees for their patient and dedicated performance in the past year. In 2015, the Company targets to achieve sale revenue of Bt17,600 million: Bt10,000 from low-rise projects and Bt5,500 million from condominium projects. A total of 24 projects will be launched with combined value of Bt29,500 Dr.Tawatchai Nakhata million: consisting of 20 single house and townhouse projects CHAIRMAN worth Bt25,000 million, 3 condominium projects worth Bt3,000 million, and a project in Khao Yai worth Bt1,500 million. Mr.Chainid Adhyanasakul CHIEF EXECUTIVE OFFICER 03 ANNUAL REPORT 2014 FINANCIAL INFORMATION Property Perfect Public company Limited. (Unit : Million Baht) 2012 2013 2014 Financial Position Total Assets 26,176 30,668 31,305 Project Development Cost and Land for Development 13,353 16,927 17,525 Inventories 32 34 35 Total Liabilities 17,545 22,022 22,295 Shareholders’ Equity 8,631 8,646 9,010 Operation Results Sales 9,094 11,011 12,416 Total Revenue 9,270 11,229 12,785 Gross Margin 3,273 3,646 4,301 Net Income 203 41 402 Financial Ratio Net Profit (%) 2.19 0.37 3.15 Return on Equity (%) 2.48 0.48 4.56 Return on Total Asset (%) (%) 0.85 0.15 1.30 Debt to Equity Ratio 2.03 2.55 2.47 Current Ratio 1.99 2.11 1.55 Per Share Data Net Income per Share 0.06 (0.02) 0.06 Dividend 0.03 - 0.044 Book value 1.53 1.50 1.55 Note: The company split par from Bt6 to Bt1 on 6 May 2011. 04 COMPANY AND SUBSIDIARIES INFORMATION Company Information Name : Property Perfect Public Company Limited Type of Business : Real Estate Development Head Office : 17th Flr., Vorasombat Bldg., 100/1 Rama IX Road, Huaykwang, Bangkok 10310. Business Registration Number : 0107536001231 Home Page : www.pf.co.th Telephone Number : 0-2245-6640-8, 0-2247-7500-4 Fax : 0-2247-3328 No. of Paid-up Share : 5,782,930,655 Shares (31 December 2014) Par Value : Baht 1 Paid-up Capital : Baht 5,782,951,655 05 ANNUAL REPORT 2014 Legal Entity, The company hold 10% up The Company and Subsidiaries , Directly Owned Name : Estate Perfect Company Limited Type of Business : Real Estate Development Address : 17th Flr., Vorasombat Bldg., 100/1 Rama IX Road, Huaykwang, Bangkok 10310. Telephone Number : 0-2245-6640-8, 0-2247-7500-4 Fax : 0-2246-0733 No. of Paid-up Share : 120,000,000 Shares Par Value : Baht 10 Paid-up Capital Baht 1,200,000,000 Percentage of Investment : 100 % Name : Bright Development Bangkok Company Limited Type of Business : Real Estate Development Address : 17th Flr., Vorasombat Bldg., 100/1 Rama IX Road, Huaykwang, Bangkok 10310. Telephone Number : 0-2245-6640-8, 0-2247-7500-4 Fax : 0-2246-0733 No. of Paid-up Share : 10,000,000 Shares Par Value : Baht 100 Paid-up Capital : Baht 1,000,000,000 Percentage of Investment : 100 % Name : Residence Number Nine Company Limited Type of Business : Real Estate Development Address : 7th Flr., Vorasombat Bldg., 100/1 Rama IX Road, Huaykwang, Bangkok 10310. Telephone Number : 0-2245-6640-8, 0-2247-7500-4 Fax : 0-2246-0733 No. of Paid-up Share : 10,000,000 Shares Par Value : Baht 100 Paid-up Capital : Baht 1,000,000,000 Percentage of Investment : 100 % 06 Name Chiangmai Development Company Limited Type of Business : Real Estate Development Address : 17th Flr., Vorasombat Bldg., 100/1 Rama IX Road, Huaykwang, Bangkok 10310. Telephone Number : 0-2245-6640-8, 0-2247-7500-4 Fax : 0-2246-0733 No. of Paid-up Share : 2,000,000 Shares Par Value : Baht 100 Paid-up Capital : Baht 200,000,000 Percentage of Investment : 100 % Name : We Retail Public Company Limited Type of Business : Real Estate Development – Shopping Center and Commercial Area Address : 17th Flr., Vorasombat Bldg., 100/1 Rama IX Road, Huaykwang, Bangkok 10310.