SET-listed Siam Cement Group (SCG), Thailand's largest cement maker and industrial conglomerate, expects its revenue in 2023 to grow by 10% as it aims to gain more income from a petrochemical business in Vietnam and improving economic conditions.
Last year the company posted 570 billion baht in revenue, a year-on-year increase of 7% from 2021, driven by packaging, cement and building material businesses.
"The economic outlook for 2023 seems to be better than last year, but we will continue to monitor risk factors that may affect our businesses," said Roongrote Rangsiyopash, president and chief executive of SCG.
The company believes the recovery of Thai tourism and the positive impact of Beijing's decision to reopen the country will boost the consumption of a range of products sold by SCG's subsidiaries.
Long Son Petrochemicals (LSP) complex project in Vietnam will also be a major source of revenue in 2023, said Mr Roongrote.
SCG expects earnings from LSP to account for around 10% of total revenue.
The company's largest investment project in Vietnam and Asean, LSP is scheduled to start commercial operation in the middle of this year.
According to Mr Roongrote, though the company's 2022 revenue increased last year, its profit plunged by 55% year-on-year to 21.3 billion baht.
He attributed the decrease to higher energy costs, lower shares of profit from companies SCG invested in and lower "chemicals' spread" -- the difference between prices of chemical products and costs. The term is similar to profit margin.
In the fourth quarter of last year, SCG saw its revenue fall by 14% quarter-on-quarter to 122 billion baht due mainly to lower sales of chemical products and sluggish demand.
Profit in this quarter plummeted by 94% quarter-on-quarter to 157 million baht because of more expensive coal, which is used as a fuel, higher electricity costs and lower chemicals' spread.
In 2022, sales of the company's high value-added products and services stood at 196 billion baht, accounting for 34% of total revenue.
The company allocated an investment budget worth 40-50 billion baht for 2023, with 50% of the money going to the LSP complex and other investment projects in Thailand and overseas.
SCG also continues to invest in clean energy business, with electricity generation capacity standing at 234 megawatts last year, a year-on-year increase of 78%, said Thammasak Sethaudom, executive vice-president of SCG.
The company provides a service to install smart grid technology at factories, hotels and hospitals.