Mr Adisorn Thananan-narapool, director and senior executive vice-president of Land & Houses Plc, said about the performance during the second quarter of this year as following;

1. The company and subsidiaries reported sales deprived from the transfer of homeownership to buyers totaling 6.04 billion baht, a 37.58% rise from the previous quarter and a 22.64% increase from the same period last year.
2. The company and subsidiaries had a gross profit margin of 34.2% in the second quarter, improving from 33.4% in the previous quarter but falling from 38.9% in the same period of the year before, because the market competition remained intense.
3. The company and subsidiaries recorded a net profit of 1.442 billion baht, up 31.33% from 1.098 billion baht in the previous quarter but declining 17.36% from 1.745 billion bah in the same period last year. This was because the company booked gains from the sales of investment up to 460 million baht in the second quarter of 2004 while the gains from the sales of investment were recognized only 136 million baht in the second quarter of 2005.

The company and subsidiaries had a strong financial position at the end of second quarter of 2005 with a cash-flow of over 4.25 billion baht. As a result, the company's board of directors approved a resolution to pay interim dividends to shareholders at 0.25 baht per share and the payment is scheduled to be made on September 13.

Operation performance
Mr Naporn Suthornchitcharoen, a senior executive vice-president of Land & Houses Plc, said about the overall picture of housing market that the new housing registration in Greater Bangkok totaled 32,400 units during the first half of this year, a 24.2% surge from the same period last year. Of the total, the units of self-built housing and housing projects are classified as following;

Comparison of housing registration classified by operation during 2001-2005

Type	Jan-Jun 2001	Jan-Jun 2002	Jan-Jun 2003	Jan-Jun 2004	Jan-Jun 2005
Self-built housing	9,297	9,143	9,318	8,761	11,685
Housing projects	8,697	9,324	9,805	17,313	20,715
Total	17,994	18,467	19,123	26,074	32,400

Comparison of housing registration classified by type during 2001-2005

Type	Jan-Jun 2001 (unit)	Jan-Jun 2002 (unit)	Jan-Jun 2003 (unit)	Jan-Jun 2004 (unit)	Jan-Jun 2005
Detached house	2,912	3,386	5,583	11,722	12,044
Change	- 1 %	16 %	65 %	110 %	2.7 %
Duplex	32	6	362	23	410
Change	- 64 %	- 81 %	5,933 %	-94 %	1,682 %
Townhouse & shophouse	2,205	4,213	3,444	4,563	5,353
Change	126 %	91 %	- 18 %	32 %	17.3 %
Condominium	3,548	1,719	416	1,005	2,908
Change	37 %	- 52 %	- 76 %	142 %	189.3 %
Total	8,697	9,324	9,805	17,313	20,715
Change	32 %	7 %	5 %	77 %	19.6 %

Source: Government Housing Bank

The registration of housing projects built by developers during the first half of this year was 20,715 units, a 19.6% increase from the same period last year. When considering development types, the registration can be classified as following;

• Detached houses were registered at 12,044 units, up 2.7% from the first half of last year.
• Duplexes were registered at 410 units, up 1,682% from the first half of last year.
• Townhouses were registered at 5,353 units, up 17.3% from the first half of last year.
• Condominiums were registered at 2,908 units, up 189.3% from the first half of last year.

It is forecast that the total housing registration will exceed 68,000 units by the end of 2005 and major factors affecting the housing market are;

• The gross domestic product growth is estimated to stay between 3.5%-4.5% this year, a revise down from an earlier projection at 5.5% early this year.
• The government investment in mega infrastructure projects is expected to boost economic activities. The megaproject investments are planned to ease the traffic congestion in Bangkok and they may give a boon to the entire housing market in the future.
• Even though the interest rates are expected to rise by no more than 100 basis points before the end of this year, the levels are considered low when compared to the rates during the peak of housing market and the 1997 economic crisis. (Minimum lending rates or MLR stand at 5.75% per year and mortgage rates are 2.25% in the first year and after that the rates are float at MLR minus 0.75%) At the same time, banks are heavily competing to extend housing loans to homebuyers.
• Inflation rates are predicted to stay between 4%-4.5%
• The continuing rise of fuel prices, particularly diesel**, will cause a higher cost of construction materials and the development cost for newly-built houses is expected to increase by 8-10%.
  **Diesel prices were 14.59 baht per liter as of February 20, 2005 and the current prices are 22.99 baht per liter, a 57.5% jump.
• The stricter consideration of commercial banks when extending financial supports to finance property projects.
• Land acquisition by developers has reduced significantly since the end of 2004.
• The approval of new housing project licenses dropped largely during the first half of 2005. This was noticed as there were only 182 housing projects launching sales during the first six months of the year, or only 40% of the project number in 2004.

It is concluded that the slowing economy, rising oil prices and higher inflation, have eventually affected the consumer confidence. But the restriction of banks to extend loans to support developers has slowed down new project launches and expansions and this is beneficiary to make the housing market move toward a balance, matching real demand.

This year, the overall residential market in Greater Bangkok is forecast to grow 10% to 68,000 units, of which 70% of them will be developed by property developers.

Company's operation performance

Mr Naporn said about the operation performance during the first half of 2005 that the company delivered 1,892 houses to homebuyers, of which 1,623 units were detached houses and 269 condominium units. The housing delivery rose 23.68% year-on-year from 1,478 units in the first half of 2004.

During the fist six months of this year, the company had 31 ongoing projects, of which three were newly launched.

In the second half, the company plans to introduce 10 new housing projects, of which six projects will be launched in the third quarter and four projects in the fourth quarter. Among the planned new projects, seven of them are located in Bangkok and neighboring provinces, one condominium project in Sukhumvit Soi 43, and one housing estate each in Chiang Mai and Khon Kaen. This will make the total projects under development in 2005 reach 41 projects.

New project launches during the second half of 2005

Project	The planned launching period
1. Manthana Rangsit 2	July
2. Manthana Pinklao-Rama 5	August
3. Prueklada Rama 2	August
4. Siwalee Pinklao-Sathorn	August
5. The Bangkok Sukhumvit 43	September
6. Siwalee Chiang Mai	September
7. Ladawan Sathorn-Petchkasem	October
8. Siwalee Suvarnabhumi	October
9. Nuntawan Ring Road-Onnuj	October
10. Cholada Khon Kaen	November

The housing projects which are launched in the first half of 2005

Project	The planned launching period
1. Nuntawan Suan Laung Rama 9	March
2. The Bangkok-Narathiwas Rajanakarin	May
3. Ladawan Pinklao-Sathorn	May

The company will continue its pre-built housing strategy and concentrate on research and development to develop the work system. The researches will continuously be made to focus on housing demand and consumer requirements toward house functions. The findings will be used to develop housing products to serve demand of targeted buyers, so that they will get quality houses at reasonable prices.

The company will concern every detail to reduce risks associated to the property business. It will conduct market survey and feasibility study, housing demand in various locations and pricing segmentations as well as opinions of potential buyers towards housing designs and the results will be used as information to outline the construction plan which will match actual sales at each time.