SET-listed Thoresen Thai Agencies Plc (TTA) seeks an expansion into overseas countries, covering shipments, food and beverage, logistics and water management, expecting those new businesses to beef up its future earnings.
Jitender Pal Verma, senior executive vice-president and chief financial officer, said TTA is looking for new opportunities abroad, preferring the new businesses to come with high-value-added features and fatter margins.
He plans to make merger and acquisition (M&A) deals in Asean and the Middle East.
"TTA expects to complete at least one or two M&A deals this year," Mr Verma said.
For this year, TTA has provided a budget of 1-1.5 billion baht, excluding M&A, aiming to buy one or two marine vessels to serve the freight market. The new fleet is expected to be delivered to TTA in the second quarter.
"We are looking for used ships with a price of 480 million baht per unit," Mr Verma said. "Each ship should have been in use for 11-12 years."
As of last December, TTA owned 21 vessels with an average size of 53,742 deadweight tonnes (DWT) and an average age of 12 years.
The firm's main cargoes are minerals, coal, crops and steel products.
Mr Verma said marine freight sentiment is expected to recover after the average time charter equivalent (TCE) rate in 2017 improved to $8,469 a day, up by 64% from $5,155 a day in 2016.
The average TCE rate in the fourth quarter of 2017 went up to $9,982 a day. He forecasts the average rate to stay at $8,000 a day.
China remains a majority market for marine shipments because of demand growth from iron ore imports and exports, as well as robust growth in steel production.
Founded in 1983, TTA posted revenue of 13.4 billion baht last year, down 2%, while net profit stood at 588 million, swinging sharply from a net loss in 2016 of 418 million.
TTA operates four business units: offshore service (37%), shipping (30%), agro-chemical (21%) and investment (12%). Its M&A deals are in the investment unit.
Mr Verma said TTA plans to expand 20 new branches of its Pizza Hut franchise, spending 120 million baht. TTA secured the franchise rights last June from Yum Restaurants International Thailand to operate Pizza Hut here for 10 years.
TTA shares closed Friday on the Stock Exchange of Thailand at 8.70 baht, up five satang, in trade worth 17.4 million baht.
