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With its mission to invest in domestic and overseas markets, SCG has allocated budget of $72 million to increase capacity in cement-building materials business, and restructure investment plan to drive business in the region.
Kan Trakulhoon, president and CEO of SCG, disclosed the unreviewed consolidated financial statements of SCG for the second quarter of fiscal year 2013, which showed revenue from sales of $3.563 billion, an increase of 6 per cent year on year on higher sales volume of domestic cement and chemicals products.
The profit for the period registered $332 million, increased 132 per cent year on year, following the recovery of the chemicals margins, growth of the cement demand in Thailand, and dividend contribution from SCG Investment.
On a quarter-on-quarter basis, in the second quarter of this year, revenue from sales decreased 3 per cent, while the profit for the period grew 13 per cent, benefitting from the dividend from SCG Investment.
For the first half of 2013, SCG recorded revenue from sales of $7.235 billion, an increase of 6 per cent year-on-year from higher sales volume in most business units. Profit for the period increased 83 per cent year-on-year to $627 million, as the domestic demand for cement was robust, and the chemicals margins recovered from the deep trough of the first quarter of last year.
For SCG’s combined ASEAN operation (ex-Thailand), the revenue from sales in the second quarter of this year amounted to $318 million, which is 9 per cent of SCG’s total revenue from sales. During the first half of 2013, the revenue from sales amounted to $596 million, an increase of 22 per cent year-on-year.
As of June 30, 2013, total assets of SCG amounted to $13.489 billion, while the total assets of SCG in ASEAN (ex-Thailand) amounted to $2.068 billion, which is 15 per cent of SCG’s total consolidated assets.
For operating results of SCG in Vietnam, SCG reported the second quarter of this year’s revenue from sales at $147 million. During the first half of 2013, SCG reported revenue from sales at $230 million, an increase of 43 per cent year-on-year, from the consolidation of Prime Group.
Accordong to Trakulhoon, recently, the Board of Directors of SCG has approved the total investment of $72 million to increase the production capacity in two projects of SCG Cement-Building Materials. First, the company invests towards 400,000 square metres per year capacity expansion in the production of MG Stone-Slabs, used primarily for counter-top and floor applications, whose plant located in the provinces of Saraburi in Thailand, with the expected start-ups in mid-2014. This project is aimed at driving sales of high value-added products as MG Stone-Slabs is a material that has beautiful pattern similar to that of rare stones but very strong and easy to keep and adapted to various uses.
Second, SCG invests to increase equity in the roofing business. The company buys back all shares from Monier Group Services GmbH (Monier) to adjust the investment structure of roofing business in Thailand, the Philippines, Cambodia, Vietnam and Laos. This investment is expected to be completed in December 2013.
“Even though several parties are concerned with an anticipating slowdown of the ASEAN economic growth in the second half of this year, SCG is confident that, in the long run, ASEAN will remain attractive foreign investment location with sustainable strength and growth so that the company continues to enhance its capabilities and offerings within ASEAN, following the vision of becoming an ASEAN sustainable business leader,” Trakulhoon said.
Recently, SCG’s cement plant construction project in Myanmar has been approved by the Myanmar government. It is in the process of submitting the investment budget plan for approval by the group’s Board of Directors. This project will meet an increasing demand of cement in Myanmar and at the same time raise SCG’s cement and building materials leadership profile in ASEAN.