SET-listed Siam Cement Group (SCG), Thailand's largest cement maker and industrial conglomerate, voiced concern over increasing prices of raw materials, following a global oil price surge, after seeing operation costs rise by 20% over the past three months.
"Raw material prices and global oil prices are key risk factors that can affect businesses and the economy. Their prices are expected to increase in the future," said Roongrote Rangsiyopash, president and chief executive of SCG.
Oil prices can sometimes increase dramatically, especially during the winter. The global economic recovery is also driving demand for fuels though the Covid-19 impact remains.
SCG plans to control costs by cutting unnecessary expenses, increasing production efficiency and applying more new technologies to the business.
"If the company cannot control operation costs during the surge in oil and raw material prices, it may need to increase product prices both in domestic and overseas markets. But that will be our last choice," said Mr Roongrote.
SCG said it will try not to place more financial burdens on consumers while the government is preparing to reopen the country to welcome back fully vaccinated foreign tourists on Nov 1.
The reopening is expected to help boost business activities, which have been long subdued by the Covid-19 impact.
"SCG expects once the country is reopened, the economy will manage to recover and grow," said Mr Roongrote.
The company is positive about the construction and building material business after the end of a one-month shutdown of construction workers' camps to contain the spread of the virus.
From January to September, SCG saw its revenue increase by 28% year-on-year to 387.44 billion baht. Profit also rose by 49% year-on-year to 38.86 billion baht.
The increase was attributed to sales of chemical products and equity income.
In the third quarter, SCG recorded a 31% increase in revenue to 131.82 billion baht year-on-year due to higher prices of chemical products.
However, profit in this quarter dropped by 11% year-on-year to 9.06 billion baht due mainly to the new outbreak of Covid-19, which led to lockdown measures which eventually affected cement and building material business.