SCG raises investment for 2019
Funds headed for dom
SET-listed Siam Cement Group (SCG), Thailand's biggest cement maker and industrial conglomerate, has boosted its investment budget by 23% to 60 billion baht in 2019 to expand domestically and overseas.
The funds are for a petrochemical complex in Vietnam, the Map Ta Phut Olefins debottlenecking project, a packaging business in the Philippines and R&D.
Last year SCG allotted 46 billion baht for investment.
Roongrote Rangsiyopash, SCG's president and chief executive, said half of the investment budget is for the Long Son refinery petrochemical complex (LSP) in Vietnam. SCG plans to invest US$5.4 billion (169 billion baht) in the complex.
In Thailand, SCG increased production capacity at the Map Ta Phut Olefins debottlenecking project from 1.7 million tonnes to 2.05 million tonnes of petrochemicals per year.
Mr Roongrote said SCG is also seeking a merger and acquisition (M&A), either in Thailand or overseas.
"We are focusing on an M&A of a packaging and cement-building materials business in Asean," he said.
In 2019, the company expects revenue to rise by 5%, up from 478 billion baht last year, thanks to an improving global economy, government infrastructure investment and the expansion of overseas operations.
"The company expects domestic demand for cement will increase 3-5% from last year because of the construction and real estate sectors expanding following government investments," said Mr Roongrote.
In 2018, SCG's sales revenue increased 6% year-on-year to 478 billion baht. Profit for the year registered 44 billion baht, down 19% year-on-year due to global economic uncertainties driven by the trade war, a volatile oil market and a stronger baht, which affected overall performance.
In the last quarter of 2018, revenue from sales dropped 4% quarter-on-quarter to 117 billion baht from lower chemical product prices, but increased 3% year-on-year from higher chemicals sales volumes and domestic growth in cement demand from the building materials business. Profit for the period rose 11% to 10 billion baht quarter-on-quarter, attributed mainly to seasonal dividend contributions from the investment business in the last quarter, but decreased 17% year-on-year, mainly due to declining performance from the chemicals business.
SCG's revenue from export sales was 130 billion baht, or 27% of total revenue from sales, a rise of 6% year-on-year.