The Company’s financial result in 2022 was disappointing, as it was in the previous year, but even more so. Construction revenue was, as anticipated, lower than in the previous year and reasonably close to our internal target, which made some allowance for continued nationwide labour shortages caused originally by the COVID-19 pandemic. However, what was not anticipated, was the start of the armed conflict between Russia and Ukraine in the early part of the year. The conflict had major negative impact on the Thai and other global economies, resulting in sudden sharp increases in local energy prices and commodity prices, resulting in a sharp increase in costs of construction materials. This negatively impacted the gross margin, particularly on our largest project currently under construction. Accordingly, overall gross margin achieved was significantly lower than in the previous year in terms of amount and percentage (of construction revenue). The result was an unforeseen significant net loss for the year.

Christiani & Nielsen Energy Solutions Co., Ltd., (CNES) a subsidiary company established in 2019 is making good steady progress, and is on its way to reaching profitability.

In the early part of this year, the Company also established a new subsidiary company, Christiani & Nielsen DCM Co., Ltd. specializing in high-quality building works such as hotels and resorts. This will provide an entry into the key business sector related to the important leisure and tourism market.

Good corporate governance is paramount for the Company. It was pleasing, therefore, to receive a rating of “Excellent’ this year too and making it for 5 consecutive years from 2018-22. To meet for the changing needs of the world, our Risk Management Committee is renamed as “Sustainability and Risk Management Committee” with wider scope to cover sustainability and environmental issues.

In the short term, the construction market is expected to continue to be sluggish due to fragile economies inside and outside of Thailand and the political uncertainties associated with the elections. In the medium term, economies and the construction market are expected to improve gradually and head towards normality. An important determining factor for this would be the continuing conflict in Ukraine, which unfortunately shows no signs of abating or reaching a peaceful resolution.

In expectation of improved economic conditions ahead, I thank the shareholders, our clients, and all stakeholders for their confidence and support and, on behalf of the Board of Directors, I express our sincere thanks also to the management, staff and all employees of the Company for their hard work, loyalty and dedication throughout the past year.

Mr. Santi Grachangnetara
Chairman