Distribution Transformer
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พลังงานทดแทน Back to contents CONTENTS 05 Financial Highlights 06 Message from the Chairman 09 Policy and Overview of 15 Nature of Business Operation business operations 35 Risk Factors 40 General Information 44 Capital Structure 48 The Structure of Management 63 Corporate Governance 88 Corporate Social Responsibility 104 Internal Control and 108 Audit Committees Report Risk Management 110 Related Party Transactions 116 Management’s Discussion and Analysis 123 The Board of Directors 124 Financial Statements obligation for the Financial Statement 201 Board of Director & Board of Management 3 EKARAT ENGINEERING (PUBLIC) CO.,LTD. ANNUAL REPORT 2018 Back to contents Back to contents Summary of Financial Information of Ekarat Engineering Public Company Limited and Subsidiary 2561 2560 Financial Highlights Revenue from operation (Million Baht) 1,464.30 1,684.45 Total revenue (Million Baht) 1,492.21 1,732.27 Cost from operation (Million Baht) 1,193.66 1,354.31 Gross Profit (Million Baht) 270.64 330.14 Selling Expenses (Million Baht) 119.41 125.94 Administrative Expenses (Million Baht) 155.60 165.45 Net Profit (Million Baht) (279.65) 44.30 Total Assets (Million Baht) 1,616.25 2,011.90 Total Liabilities (Million Baht) 735.24 810.95 Total Shareholders’ Equity (Million Baht) 881.01 1,200.95 Ordinary Shares (Million Shares) 1,343.29 1,343.29 Paid-up Share Capital (Million Baht) 1,074.63 1,074.63 Par Value (Baht) 0.80 0.80 Earnings (loss) Per Share (Baht) (0.208) 0.033 Book Value per Share (Baht) 0.66 0.89 Gross Profit Margin (%) 19.31 20.01 Net Profit Margin (%) (18.74) 2.56 Return on Total Assets (%) (17.95) 4.20 Return on Equity (%) (26.86) 3.70 Total Debt to Equity (times) 0.83 0.68 1684.45 Total Revenue from year 2016-2018 1623.20 Unit:Million Baht 1464.30 2016 2017 2018 5 EKARAT ENGINEERING (PUBLIC) CO.,LTD. ANNUAL REPORT 2018 Back to contents MESSAGE FROM THE CHAIRMAN Mr.Vichit Yamboonruang Chairman of the Board The economic overview of the domestic in 2018 was likely to improve continuously but it was only corporate. The investment of private ownership of business that has a bit improved and has delayed the investment of the government related to the business of Ekarat Engineering Public Company Limited. There was also the volatility of the global economy from the trade war between the United States and China which indirectly affects to the export of Thailand. It made the competition increased continuously in the transformer market. That was the important factors in the company’s core business. The solar energy business continuously grew according to the government’s policy that encouraged the use of alternative energy in accordance with the renewable energy and alternative energy development plan (AEDP), especially for the investment of solar rooftop on the business sector and households in the form of electricity for their own use in order to the electricity production cost from solar rooftop was lower than the retail price which the Electricity Generating Authority of Thailand was the distribution. The business sector was interested in installing the solar rooftop to reduce costs continuously and it can be speculated that in the future will be able to sell the exceeded electricity to the system as well. The company had more incomes from selling solar panels that had been consented to the TIS standards and from the installation of solar panels than last year but at the same, competition in the solar energy business is also rising as the number of operators increased as well. 6 EKARAT ENGINEERING (PUBLIC) CO.,LTD. ANNUAL REPORT 2018 Back to contents The company has operated the 3-year business plan (2018-2020), consisting of 3 main policies, namely, 1) Emphasize profit making 2) Progression of the organization and 3) Investment by adjusting the functional and working process to increase competitiveness. The outdated machines have been replaced by the updated machines for improving the production processes more quickly. The product planning and inventory management have been improved to response the customer demands. Moreover, the sale strategies are always the most important role to emphasize by adding the additional customer both the domestic and international target groups in order to increase the sales and the existing maintenance services. The overview of the transformer and the solar energy industry in 2019 continuously increases as demand for electricity and the growth of GDP. The upcoming election in 2019 will make the worth investment. There are also the projects to promote the investment of the government in Thailand Power Development Plan (PDP 2018) to provide sufficient electricity for the country to meet the demand and Eastern Economic Corridor Plan (EEC) which are expected to have a lot of demand for transformers and solar panels so it is an important opportunity to increase sales. The company is able to develop the quality competitiveness of the product continuously and improve the processes simultaneously by seeking the new technologies to improve the capability of the production betterment and also reduce production costs as well as improve the potential crews to make the foundation for sustainable development of the company. On behalf of the Directors, Management Team and staff of the company would like to express our sincere gratitude to all stakeholders, shareholders, customers, business partners and financial institutions for always kind support to the company. We strive and work hard to develop the potential of the company to move forward and make the sustainable yields. Always be the leadership in the transformer business and emphasize on the social responsibility for the most benefit of all stakeholders. On behalf of the Directors and Management Team Ekarat Engineering Public Company Limited (Mr. Vichit Yamboonruang) Chairman of the Board 7 EKARAT ENGINEERING (PUBLIC) CO.,LTD. ANNUAL REPORT 2018 Back to contents Back to contents Ekarat Engineering Public Company Limited (the “Company”) was incorporated on 24 June 1981 Policy and overview of business operations Policy with initial registered capital amount 4 Million Baht by Noichaiboon’s family as a major shareholder. The company operates manufacturing and distribution (Distribution Transformer) under the trademark “EKARAT” which distributed in both domestic and international markets in South East Asia, South Asia, the Middle East and Australia, gained the trust in design and engineering until the sales always be the number one. In 1994, the Company was approved to be listed on the Stock Exchange of Thailand and transformed into a public company. The Company increased its registered capital 302 Million Baht in 1998, then in 2006 started trading in the Stock Exchange of Thailand in the energy and utility sector under the name of the securities “ AKR” and increased the registered capital to 790 Million Baht with a total of common stock 790 Million shares with a par value of 1 Baht per share. Later in 2012, the company reduced its registered capital by reducing the par value to par 0.80 Baht which caused the registered and paid-up capital of the Company to decrease to 632 million baht. Later in 2013, the company increased the registered capital to 1,074 Million Baht by issuing new ordinary shares 503 Million shares par value 0.80 Baht which is making the Company with registered capital 1,074 Million Baht and divided into common stock 1,343 Million shares until now. In addition, the Company has the initiative to find new businesses which were consistent and able to support the transformer business therefore the importance and need for clean energy sources for electricity generation to be recognized by observing the potential and various factors in Thailand. The solar energy business, which was the solar power generation system producing the clean energy to be renewable and good for our environments. In 2004, the Company invested in establishing Ekarat Solar Company Limited to manufacture and supply solar cell (Solar Module), with manufacturing, assembly and distribution of solar panels at Chachoengsao Province with a capacity of 15 MW per year. Later in 2006, the Company set up a solar cell factory (Amata City) at Amata City Industrial Estate, Rayong Province with a capacity of 25 MW per year. In addition, the company also designs and installs electricity from solar energy and renewable energy and to be consultant on the energy conservation process, including the construction of power plants. In 2015, the Company invested in the establishment of Ekarat Energy Company Limited, which was operated in all energy businesses as a distributor, advising, bidding, investing in the energy business industry including various power plants both inside and outside the country. 9 EKARAT ENGINEERING (PUBLIC) CO.,LTD. ANNUAL REPORT 2018 Back to contents In the present, the Company Headquarter is already operational in Bangkok. The transformer factory and the solar panel assembly is located at Chachoengsao Province. The solar cell factory is located in Rayong Province. In addition, there are 10 transformer service centers covering all over Thailand. Policy and organization direction The Company is committed to produce the products that are standard and durable, be able to meet the needs of consumers in all aspects by running the business under the good corporate governance. Adhere to the principles of corporate governance with transparency, accountability, ethics and commitment to sustainable business development with the environment and social responsibility with regard to stakeholders both inside and outside the organization. Board of directors have a vision to review the operating strategy of the Company to be consistent with the company’s objectives and goals. Vision “To be the leader in the transformer business of the ASEAN” Missions 1. Always improve the products and the services to be the best and above the expectations of customers.