Message From The Chairman

To All Shareholders

    For the past 2020, we faced the Coronavirus 2019 (COVID-19) pandemic which resulted in the country shutdown to respond to the prevention of the outbreak. The economic activities in each country have been tremendously stopped as to follow the preventive measures declared for public cooperation including avoid crowded places, stay at home and maintain social distancing. Consequently, these happenings have led the world economy gone to economic crisis. Many businesses were closed and unemployment rate rose up unprecedentedly. The government of each country has been obligated to impose monetary and fiscal policy to uphold its national economy.

    This pandemic inevitably affected the jewelry industry as consumer purchasing power has suddenly decreased and with the fearful emotion which has eventually led to the stage of stop purchasing. The situation has also been aggravated by the leap in gold prices. As a result, many jewelry factories, more than ever, decided to cease their operations due to the slowdown of purchasing orders and threats from the disease outbreak. Essentially, jewelry manufacturing requires a large number of skilled labors which are at high risk of getting infections if no efficient and strict protections applied.

    As Pranda Jewelry Public Company Limited well recognizes the risks of this situation, the COVID-19 Management Committee comprising of the top executives has been established. The roles and responsibilities of the Committee are to manage the process of monitoring, protecting and controlling the pandemic, establish the preventive and control measures of the outbreak and strictly carry out preventive actions following the established measures. The Committee performance has achieved its goals as indicated by zero number of COVID-19 infected persons found in the local production base covering the executives and employees. 

    The Company has adjusted the liquidity strategy in the Group of Companies with brief details of each business unit as follows:

    1. Production Base – Reduce production costs and selling and administrative expenses, postpone investment plans with temporary suspension of some businesses due to force majeure and prepare for the upcoming orders from key 15 potential customers and other general customers.
    2. Distribution Base – Reduce selling and administrative expenses, adjust working hours and apply ‘Work from Home’ concept and focus mainly on online selling through gemondo.com and via globally recognized online marketplaces.
    3. Retail Transformation: Expanding domestic and international retail markets through rebranding Owned Brand in order to serve the customers’ needs in 3Retail Base – Reduce selling and administrative expenses and focus on Omnichannel selling through Owned Brands product line with the adjustments of service model to facilitate more convenience to consumers as well as releasing inventory through sales promotion.

    The Company has received financial assistance from the bank creditors in accordance with the relief measures announced by the Bank of Thailand in terms of suspending the principal payments, reducing interest rates and extending loan renewal periods to maintain financial liquidity in business operations.

    For the performance of year 2020, the Company had its turnover of THB 2,462.30 million, decreased 522.46 compared to the same period of the previous year at THB 2,984.76 million or equivalent to decreasing rate of 17.50 percent due to the pandemic outbreak. Gross margin was at 22.32 percent lower than the previous year due to the significant decline of production capacity. Although operating expenses decreased by 28.13 percent, an operating loss still occurred at THB 126.39 million. Nonetheless, upon the depreciation of Thai Bath currency compared to the same period of the previous year, the Company earned a gain from the exchange rate of THB 59.66 million. As a result, the Company had a loss of shareholders’ equity at THB 95.10 million, decreased from THB 146.31 million or 60.61 percent compared to the previous year.

    The Company still holds a stable financial position considering from the Debt to Equity at 0.90 times and with the debt payments successively settled which could result in a decrease in financial expenses by THB 1.42 million or 2.63 percent. The Company is also able to maintain financial liquidity considering from the current ratio up to 1.66 times and operating cash flow THB 157.50 million and net cash flow of THB (104.26) million.

    The year 2021 is still a challenging year with the continuous economic slowdown and the outbreak of the Coronavirus 2019 (COVID-19). The Company is consciously aware of the consequences and has adjusted the strategies to be more competitive in terms of market expansion through online channel to directly reach end consumers and adjustments of working procedures focusing more on efficiency towards ‘New Normal’ directions which have shaped new consumer behavior. The Company also aims to improve financial liquidity management to keep the business running by applying the policy of decreasing cash outflow to the lowest and postponing investment plans as well as extending the debt payment period from financial institutions.

      Finally, on behalf of the board of directors of Pranda Jewelry Plc., we would like to express our appreciation to the shareholders and all stakeholders who always trust and support the Company. The board of directors, the executives and our employees are still dedicated to performing our own duties in accordance with business ethics, code of conducts and anti-corruption in all forms. We are constantly committed to striving our organization towards sustainability to achieve our long-term growth by significantly taking into consideration the benefits of our key stakeholders.

Mr. Prida Tiasuwan
Chairman