JWD Wages Cold-Storage Cost-Saving Campaign, Completes Solar Rooftop Installation; THB-8m-Per-Year Power Bill Cut to Lead to 42% Gross Margin Jump

BackApr 03, 2017

JWD, a leading fully integrated in-land logistics service provider, has adopted plans to reduce electricity costs of cold-storage warehouses, having completed the installation of solar rooftop systems at Mahachai and Suwinthawong, which will cut more than THB 8 million in power bills there, or more than 12% of cold-storage warehouses’ power bills, per year. It expects to complete the installation of, and begin power generation from, phase II systems in Q3 and Q4, and seeks to install the same system at the cold-storage warehouse at Bangna. These will enable it to record a 42% rise in gross profit margin this year.

Mr Charvanin Bunditkitsada, Chairman of the Executive Committee and Chief Executive Officer (CEO) of JWD InfoLogistics Public Company Limited (JWD), a leading fully integrated in-land logistics service provider, revealed that the company has formulated strategies to reduce power bills in order to increase the operating profit margin from the previous year, especially for the cold- and frozen-storage warehouses at Mahachai, Suwinthawong Road and Bangna-Trat Road (KM. 19), where electricity bills are high and represent a major cost item – about 30% of total operating costs.

With investments worth more than THB 50 million, the company has completed the installation of solar rooftop systems for the cold-storage warehouses at Mahachai and Suwinthawong Road. Power generation began at Mahachai in January and at Suwinthawong Road in February. The systems are estimated to cut the power bills by more than THB 8 million per year for those two warehouses, or more than 12% this year for the three cold-storage warehouses.

“We believe that the solar rooftop projects are great investments. Given about THB 8 million power bills saved per year, the investments will break even in six or seven years. Solar cells have an average service life of about 25 years, and are a suitable technology for Thailand’s virtually year-round high temperature, which is good for the efficiency of power generation”, said he.

He added that, after the commencement of power generation from the installed solar rooftop systems, JWD will invest more than THB 30 million in phase II installation at the cold-storage warehouses at Mahachai and Suwinthawong Road, which is expected to be completed and ready for power generation in Q3 and Q4, respectively, and cut power bills there further. He also highlighted the company’s plan to install a solar rooftop system for the cold-storage warehouse on Bangna-Trat Road (KM. 19). He noted, however, that the company will assess power consumption rates and occupancy ratios before making decisions to invest.

The cost cutting strategy as mentioned above, coupled with the faster-than-expected recovery of the demand for cold storage services for seafood products at Mahachai and the company’s efforts to offer warehousing to more poultry business firms, are predicted to allow the company to post a 42% rise (compared with the 37% figure for the previous year) in gross profit margin for the three cold-storage warehouses, and a decent level of company-wide gross profit margin.