Message from the Board of Directors

To the Shareholders,

From the COVID-19 virus pandemic situation that began in the year 2020 and continued until 2022, the severity of situation began to relax accordingly. People returned to their normal lives. The number of tourists began to gradually return to travel in Thailand. The overall picture of the office building market began to show signs of a better recovery. Although some organizations still use the policy to allow employees to work from home, the ratio of employees returning to work in office buildings has begun to increase steadily. Even though the overall economic and social conditions begin to return to normal, there are still new factors arising during the year 2022 that are still challenging the business operations of Grand Canal Land Public Company Limited (“the Company”), such as the Russian-Ukrainian conflict, which has resulted in the highest energy costs in more than 10 years and has continued to increase until now. Inflation and interest rates also tend to increase. These factors affect the performance, income and cost of expenses in all business sectors, including the Company’s business.

Although there are still factors that cause the overall situation to not return to normalcy, the Company continues to carefully implement management policies in all businesses. We give importance to risk management, liquidity maintenance, control of operating costs and expenses to be efficient and consistent with the revenue to mitigate the impact on the overall business. We take into account the interests of all groups of stakeholders, whether the tenants, shops, customers, suppliers, employees and shareholders, etc. The Company still has financial stability according to the plan. The net interest-bearing debt to equity ratio remains below the Company’s policy set at 1 time. This is partly caused by the Company’s financial cost management discipline, such as trying to reduce interest-bearing debt to be lower than the year 2021

For the overall performance of 2022, the Company had operating income of 1,515 million baht, a decrease of 40 million baht or 3% from 2021. It was mainly from the real estate business with lower revenues. However, revenue from rental and service business which is the Company’s core business slightly increased compared to the previous year due to the overall situation and business conditions that gradually recovered. Meanwhile, the occupancy rate of office buildings remained at the same level as the previous year. In terms of costs and administrative expenses of the Company, there is an increase of 46 million baht or 7% compared to 2021 due to the increase in costs and expenses of the Nirati Don Muang Project. In addition, the impact of energy costs and inflation that have been rising continuously also causes the cost and administrative expenses to increase accordingly even though the Company continue to implement strict control policies and reduce costs. Therefore, the gross profit margin and operating profit margin decreased compared to the previous year. However, it still follows the set plan. The Company is ready to study and develop new investment projects and manage the current business to support the Company’s growth in the long run.

The Company still emphasizes being a transparent organization committed to conducting business fairly and continues to attach importance to good corporate governance. We communicate with directors and employees to help them understand and acknowledge the importance of such matters. The Company’s communication is on the principles of good corporate governance in 2022, such as practical approaches for dealing with conflicts of interest or other practices, restrictions on the use of inside information, etc. In 2022, the Company still maintained a 5-star rating in the corporate governance survey of listed companies, which will help build confidence among stakeholders in terms of conducting business with transparency and taking into account all stakeholders equally.

Apart from giving importance to the principles of good corporate governance, the Company is also committed to driving business with regard to community, social and environmental responsibilities. The Company’s business operation is in a manner of creating sustainable growth along with community, social and environmental development. In 2022, the Company implemented a sustainable development plan, such as collaborating with the Department of Internal Trade and agricultural entrepreneurs in organizing Organic Weekend Market to help distribute income to entrepreneurs in the agricultural sector or organizing the Recycle Day activities to campaign for recycling waste separation in cooperation with the Huai Khwang District and the private sector. This could raise the awareness of the global crisis and take part in helping to alleviate such crises. In addition, the Company continued to maintain the water condition in the Yai Sun Canal area in collaboration with the district offices and the Bangkok Metropolitan Administration to solve and prevent wastewater problems to surrounding communities, etc.

The Board of Directors would like to thank all shareholders and stakeholders including financial institutes that have always supported the Company’s operations as well as the executives and employees of the Company. Everyone has adapted quickly to various crises that have occurred and is determined to dedicate their physical and mental strength to make the Company overcome such situation strongly. The Company is confident that the Board of Directors, executives and employees will do their best with caution and prudence taking into account the interests of all stakeholders, to create sustainable growth altogether.