SCG announces Operating Results for FY2016, showing profit increase 24% y-o-y, thanks to the performance of the chemicals business and energy costs. SCG believes that in 2017, Thailand’s economy shows an upturn trend while the ASEAN market continues to prosper. SCG further advances in innovation and technology to adjust efficiency and business operations to uplift competitive capabilities and sustainably tackle challenges in the future.
Mr. Roongrote Rangsiyopash, President and CEO of SCG, disclosed the company’s unaudited Operating Results for 2016, with registered Revenue from Sales decrease 4% y-o-y to 423,442 MB, Profit for the Period reached 56,084 MB, an increase of 24% y-o-y, attributed mainly from the continuous performance of the chemicals business. In addition, export Revenue, which accounted for 27% of SCG’s total Revenue from Sales, y-o-y to 112,549 MB.
On a quarterly basis, SCG’s Q4/2016 Revenue from Sales decreased 6% y-o-y and 5% q-o-q to 99,613 MB, primarily reflecting the lower chemicals prices, However, Profit for the Period registered an increase of 9% y-o-y at 12,478 MB from better performance of associated companies, decreased 11% q-o-q, partly due to lower performance of the chemicals business, following its 40-day maintenance turn-around of the first cracker complex (ROC) in Thailand and decreased building materials prices following the marketing situation
The 2016 performances of SCG’s businesses in ASEAN
The consolidated 2016 Revenue from Sales of SCG’s ASEAN production facilities and Thai exports to ASEAN countries amounted to 97,669 MB, representing 23% of SCG’s consolidated Revenue from Sales, 2% decrease y-o-y as a result of the strong competition and decreased product prices. As of 31 December 2016, SCG’s total assets in ASEAN excluding Thailand stands at 126,055 MB or 23% of the company’s total assets.
The total assets of SCG as of December 31, 2016 amounted to 539,688 MB.
The 2016 operating results by business units are as follows:
- SCG Cement - Building Materials recorded FY2016 Revenue from Sales decreased 4% y-o-y to 170,944 MB, as a result of the strong competition. The business unit registered Profit for the Period dropped 17% y-o-y to 8,492 MB, due to lower EBITDA and increased depreciation expenses.
- SCG Chemicals recorded FY2016 Revenue from Sales reduced 6% y-o-y to 188,163 MB, primarily reflecting the lower chemicals prices. The business unit registered Profit for the Period grew 48% y-o-y to 42,084 MB from the cyclical upturn of the petrochemical industry and better performance of associated companies.
- SCG Packaging recorded FY2016 Revenue from Sales increased 5% y-o-y to 74,542 MB, The business unit registered Profit for the Period increased 3% y-o-y to 3,565 MB.
Mr. Roongrote said “In ASEAN, we continue to implement strategies coupled with solidifying the SCG brand. SCG believes that this market holds high prospects with dynamic growth from the government’s investment policies as well as domestic consumption and trade among ASEAN countries. As for SCG’s ASEAN investments, they are according to the plan with the cement plant in Myanmar holding a production capacity of 1.8 million tons per year and Vietnam’s 2nd kraft paper plant at 243,000 tons per year amounting to a total of 489,000 tons per year. Both plants have begun commercial production in early 2017 while the cement plant in Laos PDR is in the phase for its trial run. Moreover, SCG has prepared for future challenges in this year such as the chemicals’ raw materials costs and rising energy prices. Also, an increasing number of competitors have entered the cement and building materials as well as the packaging business.
Thailand’s 2017 GDP shows an upward trend resulting from government investments in large-scale infrastructure together with continual investment schemes which are expected to enhance private sector’s confidence and propel domestic consumption.
SCG has sustainably highlighted the development of High Value Added (HVA) products and services to uplift quality of life and resolve as well as response to social demands amid prompt execution and challenging limitations. Take, for example, the temporary public toilet project in the Sanam Luang area was completed in 3 days thanks to the innovative prefabricated technology namely the SCG Heim modular homes, advanced roofing systems, SCG SmartBOARD walls.
In 2016, SCG spent a total of 4,350 MB in research and development, an increase 24% y-o-y, accounting for 1% of the total Revenue from Sales. The 2016 Revenue from Sales of HVA products accounts to 160,910 MB, 38% of the total Revenue from Sales. Moreover, aside from innovative products and services contributing to the growing revenue, SCG has incorporated digital technology along with promoting corporate cultures equipping employees with skills for efficient, speedy performances to manage aggressive competition and diverse consumer behavior”
SCG announces the following resolutions of the Board of Directors’ Meeting to submit for approval at the Annual General Meeting of Shareholders, a full year 2016 dividend payment of 19.00 Baht per share for a total amount of 22,800 million Baht, or 41% of profit for the year on consolidated financial statements, of which 8.50 Baht per share totaling 10,198 million Baht was paid as an interim dividend on August 25, 2016. The final payment of dividend will be 10.50 Baht per share totaling 12,600 million Baht.
The above dividend distribution shall be paid to the shareholders entitled to receive the dividend according to the Company’s Articles of Association and who are listed in the record date on April 7, 2017 and book closing date on April 10, 2017 for the right to receive the dividend. (The XD, or the date on which a purchaser will not be entitled to receive the dividend, will be on Tuesday, April 4, 2017.) The dividend will be paid on April 27, 2017. The receipt of such dividend shall be made within 10 years.