Content Business Operation 01 Highlights of the Year 2020 7 02 Overview of Business Operation 8 03 Report of the Board of Directors 10 04 Operating Results 12 05 Business Highlights 13 06 Risk Factors 23 07 Supplementary Information 25 08 References 29 Management and Corporate Governance 09 Securities and Shareholders 32 10 Management Structure 34 11 The Nomination and Compensation Committee’s Report 51 12 Corporate Governance 52 13 Corporate Social Responsibilities Report 68 14 Internal Control and Risk Management 73 15 Risk Management and Sustainable Development Committee Report 75 16 Related Party Transactions 76 Financial Position and Operating Performance 17 Report on the Board of Directors’ Financial Responsibilities 82 18 The Audit Committee’s Report 83 19 Financial Statements 85 20 Financial Overview 187 21 Analysis of Operating Results and Financial Status 190 Other Related Information 22 Number of Registered Housing Unit in Bangkok Metropolitan Region During 2016 - 2020 208 23 Summary of Form 56-2’s Required Items in Land and Houses Plc.’s 2020 Annual Report 210 Investors can find additional securities issuer infomation in the Company’s From 56-1 disclosed at www.sec.or.th or the Company’s website at www.lh.co.th - Section 1 - Business Operation Land and Houses Public Company Limited Annual Report 2020 6 Section 1 Business Operation 2020 Highlights Land and Houses Public Co.,Ltd. & Subsidiaries 2020 2019 % Operating Result Number of active projects 94 86 9.3 Earning Ability Return on total revenues 23.01% 30.10% (7.1) Highlight of the Financial Statement (Million baht) Total revenues 31,058 33,307 (6.8) Net profit 7,145 10,025 (28.7) Inventories 52,893 53,374 (0.9) Total assets 122,571 113,139 8.3 Total shareholders’ equity including minority interest 50,601 53,183 (4.9) Per Share Data Earning per share 0.60 0.84 (28.6) Book value 4.18 4.39 (5.0) Market price (at year end) 7.95 9.80 (18.9) Number of Outstanding Shares (Million shares) 11,950 11,950 - 7 Land and Houses Public Company Limited Annual Report 2020 Business Operation Policy and overall business operation 1. Visions, Goals or Operating strategy of the Company The Company has faced the financial problems during 1998- The Company has still aimed to remain to be a leader in 1999 as a result of the economic crisis and the change in the the real estate development in Thailand. The Company foreign exchange rate to be floating rates. The Company has emphasizes and focuses on the development of the high completed its debt restructuring in 1999 by increase its capital quality of the single-detached houses, townhouses and among existing shareholders and also the new shareholder residential condominium projects for sale to target customers which is the Government of Singapore Investment Corporation in accordance with the customers’ needs at different ranges (GIC). After the capital increased, as at August 28, 2020 which of prices. is the latest Registration Book Closing Date , the Asavabhokin family is still remain the largest shareholder group with a stake 2. Major changes and development of 30.73% of total shares while the GIC holds share, both Land and Houses Pcl. was established on August 30, 1983 directly and through Thai NVDR, at 1.27% only. to operate in the real estate development with the initial registered capital of 5 million Baht. Major shareholders at During the year 2015 to August 28, 2020 which is the latest the beginning comprises of Mr. Anant Asavabhokin and Ms. Registration Book Closing Date , the Company has significant Piangjai Harnpanij. The Company was approved to list on changes and development with regard to the shareholding the Stock Exchange of Thailand on February 17, 1989 and structures and capital increase as follows: changed its status to become a listed company on April 1, 1991. % of sharholdings Shareholder Aug 2015 Aug 2016 Aug 2017 Aug 2018 Aug 2019 Aug 2020 1. Mr. Anant Asavabhokhin’s Group 1.1 Mr. Anant Asavabhokhin 24.43 24.27 23.93 23.93 23.93 23.93 1.2 Mayland Co.,Ltd* 5.78 5.74 5.66 5.67 5.67 5.67 1.3 Ms. Piangjai Harnpanij** 1.15 1.15 1.13 1.13 1.13 1.13 Total Mr. Anant Asavabhokhi’s Group 31.36 31.16 30.72 30.73 30.73 30.73 2. GIC Private Limited 16.55 17.01 16.17 8.01 8.01 1.27 3. Others 52.09 51.83 53.11 61.26 61.26 68.00 Total 100.00 100.00 100.00 100.00 100.00 100.00 Paid up Capital (million Baht) 11,694.9 11,779.1 11,949.7 11,949.7 11,949.7 11,949.7 Note : * The Company is 100% owned by Mr. Achanan Asavabhokin , Mr. Anant ‘s son and other related companies ** Mr. Anant Asavabhokin’s mother 3. Shareholding Structure of the Group Company Ratchasima, Khon Kaen, Maha Sarakham, Udon Thani, The Company directly holds shares in 11 subsidiaries Prachuap Khiri Khan, Ayutthaya and Phuket. The Company and also indirectly holds shares in 4 subsidiaries through has implemented a Pre-built strategy to sale in year 2000, its subsidiaries. (Details of Shareholding structures in which has been very well accepted by its customers. subsidiaries and associates) The Company operate property The Company has 5 associated companies , comprises of development businesses. In developing the real estate (1) Two of its associated companies operate property of the Company and its subsidiaries, they develop the development businesses which are Land and Houses residential for sale from single-detached houses, townhouses Property and Loan Fund 2 and Quality Houses Plc. and residential condominium. The Company focuses on (2) Two of its associated companies operate business developing projects in Bangkok and its vicinities and also related to property development which are Quality in large provinces such as Chiang Mai, Chiang Rai, Nakorn Construction Products Pcl. which produces and 8 Section 1 Business Operation distributes autoclaved aerated concrete used in Nature of Products and Services construction and Home Product Center Plc. which The Company and its subsidiaries operate its business operates a retail business. in developing the residential project development for sale (3) One of its associated company engages in other in area of single-detached houses, townhouses and condo- businesses which is LH Financial Groups which is miniums for sale. The Company emphasizes its projects in a holding company with its subsidiaries comprise of Bangkok and vicinities while its subsidiaries will operate in commercial Banking, Asset Management, Securities large provinces such as Chiang Mai, Chiang Rai, Khon Kaen, Business and Consulting Services. Nakorn Ratchasima, Phuket, Prachuap Khirikhan (Hua Hin), Udon Thani, Maha Sarakham and Ayutthaya. Policy on separating the operations of the Company, its subsidiaries and associated The projects which the Company and its subsidiaries companies develop and sell to customers will all be the “Pre-built The Company has set a clear policy of separating the House” comprising of single-detached houses and operations of the Companies within its group clearly as townhouses which the Company will complete the follows : construction of the houses before selling to the customers. (1) The Company, its 10 subsidiaries and 2 associated When the customers are interested in buying the houses, companies operate in real estate and property they will pay the reservation and a certain amount of development , shopping mall and hotel business. contract money. After that, the customer will pay the (2) Two of its associated companies operate businesses rest of the money of the price of the house to the related to the property development such as Company and the Company then transfers the ownership construction material manufacturer and retailer. of the house and land title deed to the customer. (3) One subsidiary company and one associated company For the Condominium which the construction will take operate in financial advisory business and a holding longer time to complete, the Company will operate in the company whose its subsidiaries operate as way that the customers will have to make a reservation a commercial banking, asset management, securities first and pay the down payment in installment for only business and consulting services. 10-25% of total unit price. The rest of payment will be paid on the day that the Company transfer the ownership of Investment policies to invest in the the unit bought to the customer when the condominium subsidiaries and associates. is totally completed. The Company has a policy to invest in the subsidiaries and associates which run the business operation in real estate The Company is a key leader in the market that create development and other businesses related to the core the concept of “Pre-built House” in the year 2000 which business of the Company such as retail business, construction has been very well accepted by the customers. Currently, material manufacturers, Commercial Bank which has the Company still continue using this concept as it has a policy to granting loans to retail housing buyers etc. The several advantages to the Company such as helping the Company may consider to invest in other businesses which Company to operate more accurately especially to reduce such businesses deem attractive and have good return. The the production cost. The construction of “Pre-built House” Company may consider to invest in such business, such allows the Company to know the clear actual construction investment must get approval from the Board of Directors cost and can control the quality of work which can build the confidence to customers who will receive the completed The management policy in the subsidiaries and house including the total project environment and that associates : The Company will send directors as the Company’s the customers can select, can see all the completion and representatives to participate in the management of the readiness for moving in, the security and society environment.