Siam Cement Group sees 5% growth in revenue this year
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Siam Cement Group sees 5% growth in revenue this year

Firm to gain from improving economy

SCG plans to invest in upgrading its Long Son Petrochemicals complex in Vietnam.
SCG plans to invest in upgrading its Long Son Petrochemicals complex in Vietnam.

SET-listed Siam Cement Group (SCG), Thailand's largest cement maker and industrial conglomerate, expects its revenue to increase by 5% this year, up from 511 billion baht in 2024, thanks to the improving Thai and Asean economies.

The government's stimulus measures will strengthen the domestic economy while economic growth in Vietnam and Indonesia will contribute to the Asean economy.

"We hope the government's spending will boost confidence among business people, including foreign investors," said Thammasak Sethaudom, president and chief executive of SCG.

"This, together with a healthier economy in Asean, will lead to customers' stronger purchasing power, which will eventually cause sales of our cement and building materials to grow."

The company is seeking new business opportunities in several markets, including North America and Australia, with the aim of introducing its products to prospective customers.

It will continue to develop more high value-added products, which promise a high profit margin, said Mr Thammasak.

In the petrochemical business, SCGC, the petrochemical arm of SCG, is working to strengthen its long-term competitive edge by investing in upgrades to its Long Son Petrochemicals (LSP) complex in Vietnam by enabling the use of US-sourced ethane.

SCGC wants to use ethane, a colourless, odourless, gaseous hydrocarbon, as a raw material because it is cheaper than naphtha.

The company recently signed a long-term agreement with an affiliate of Enterprise Products Partners LP, an ethane supplier in the US, to procure roughly 1 million tonnes of ethane per year for a period of 15 years.

SCGC will spend US$700 million constructing ethane storage tanks and supporting facilities for raw material reception. The project is expected to be completed by the end of 2027.

In the third quarter of last year, SCG announced the need to implement various measures to adapt itself to the economic slowdown. According to Mr Thammasak, one outcome was that the company managed to reduce its working capital by 6.2 billion baht from 2023.

The measures include restructuring operations and businesses for lean operations and the discontinuation of non-performing businesses as well as controlling capital expenditure by prioritising projects with high and quick returns.

"These measures collectively resulted in a reduction of net debt by 16.7 billion baht from the third quarter of 2024," said Mr Thammasak.

In 2024, SCG saw its total revenue increase by 2% year-on-year to 511 billion baht, attributed to more sales of packaging and petrochemical products.

Profit decreased by 76% year-on-year to 6.34 billion baht mainly because of LSP's performance which fully realised depreciation and lower profit contributions from associated companies.

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