SCG announces Q2 operating results with sustained growth

Thammasak Sethaudom, president and CEO of SCG, said, “SCG's operating results for the second quarter of 2024 have improved from the previous quarter due to increased sales volume from SCG Chemicals and stronger spending power in the ASEAN market, particularly in Vietnam and Indonesia. Furthermore, dividend income from associated companies contributed to a total revenue of $3.54 trillion, an increase of 3 per cent on-quarter, with a profit of $102 million, up 53 per cent. For the first half of 2024, revenue was $6.98 trillion, close to last year's figure. The sales composition included 39 per cent from SCG Chemicals, 27 per cent from SCGP, 16 per cent from SCG Cement and Green Solutions, 13 per cent from SCG Smart Living & SCG Distribution and Retail, and 5 per cent from SCG Decor."

Despite SCG being impacted by the petrochemical trough, geopolitical conflicts, intense market competition from Chinese imports, and a slow domestic economic recovery due to weak spending power, SCG has enhanced its business agility and operational resilience through several strategic measures.

First is energy cost management. For example, the cement business in Thailand has increased the use of alternative fuels to 47 per cent. The company has also increased its focus on potential growth business, such as comprehensive solar energy solutions for residential markets, plants, and industrial estates. Efforts are also made to improve the supply chain and distribution of products by employing technology for delivery planning and goods receipts to reduce working time, minimise damage, and reduce errors in the receipt and delivery process.

SCG is also promoting the application of AI for operational efficiency. In particular, SCG Chemicals utilises AI solutions from REPCO NEX to precisely manage machinery maintenance, achieving 100 per cent reliability. The company also delivers solutions that meet both the functional and pricing needs of customers, such as CPAC’s compact concrete mixer trucks. They are designed for urban construction down narrow alleys, and capable of transporting up to 2 cubic metres of concrete per trip, facilitating efficient cement usage and reducing waste.

In the first half of 2024, SCG's new products development achieved sales of $1.07 trillion, accounting for 20 per cent of total sales. High-value added products and services registered sales of $2.13 trillion (39 per cent), while SCG Green Choice, environmentally friendly products, recorded sales of $3.76 trillion (54 per cent).

SCG’s revenue from operations outside Thailand, combined with export sales from Thailand for the first half of 2024, registered $3.08 trillion, constituting 44 per cent of total revenue from sales.

For the second half of 2024, the overall economic landscape remains challenging, but SCG is prepared to respond with agility and stability. The company holds cash and cash under management totalling $2.18 trillion, along with innovative solutions that meet comprehensive customer needs.

In Vietnam, Long Son Petrochemicals (LSP) is expected to restart the entire complex, with both upstream and downstream operations, in early August to begin commercial operations in October. It is anticipated that commercial revenue will be approximately $600 million in 2024 and $1.5 billion in 2025.

However, challenges persist due to the global economic slowdown and oversupply in the chemical industry. LSP, being a capital-intensive project, is expected to incur annual depreciation and interest expenses. Despite the challenges, SCG's existing chemical operations in Thailand remain profitable due to its focus on efficiency and product offerings.

For SCG’s operations in ASEAN (excluding Thailand), revenue from sales in the first half of 2024 recorded a 12 per cent increase on-year, amounting to $1.32 trillion. This growth was primarily driven by improving market conditions in regional operations, especially in Vietnam. This contributed to 19 per cent of SCG’s total revenue from sales. This figure includes sales from both local operations in each ASEAN market and imports from Thai operations.

As of June 30, SCG's total assets amounted to $25.77 trillion. Of these, the total assets of SCG in ASEAN (excluding Thailand) were $11.79 trillion, or 46 per cent of SCG’s total consolidated assets.

In Vietnam, the company reported revenue from sales for the first half of 2024 at $656 million, marking an increase of 12 per cent on-year. This rise was mainly due to an increase in sales from LSP.

SCG in Vietnam is driving sustainable investments to bolster both the local and global economic recovery. The flagship project LSP will commence commercial operations in Q3 to meet local plastic resin demand and support related industries. These resins can be converted into essential products, such as plastic packaging, auto parts, and electrical appliances, enhancing quality of life.

To cater to the northern market, Duy Tan Plastics, part of SCGP, has launched a flagship showroom in Long Bien, Hanoi. This showroom is SCG's largest investment in Vietnam, after Ho Chi Minh City and Danang.

In line with the "Collaboration for Greener Vietnam" strategy and the national goal of net zero by 2050, SCG Cement and Green Solutions introduced SCG Low Carbon Super Cement. This environmentally friendly product reduces carbon emissions by 20 per cent during production, meeting sustainable building standards and promoting SCG’s strategy of inclusive green growth.

To pursue its commitment to reducing inequality as part of SCG’s ESG 4 Plus strategy, SCG is focusing on educational programmes. The ESG Engagement programme for 100 SCG Sharing the Dream scholars promotes an environmental, social, and governance (ESG) mindset through plant tours and a camp for developing community-help ideas.

SCG named in top 1 per cent in S&P Global Corporate Sustainability Assessment SCG has been honored as the Top 1 per cent S&P Global Corporate Sustainability Assessment in the Sustainability Yearbook 2024 by S&P Global Inc.

SCG provides career opportunities, creating sustainable future for children with disabilities SCG is continuing its collaboration with Ba Ria - Vung Tau School for Children with Disabilities through the ‘My Career Dream’ initiative, in celebration of International Children's Day 2024.

SCG launches its first SCG Low Carbon Super Cement in Vietnam SCG, ASEAN's leading conglomerate, has announced the launch of SCG Low Carbon Super Cement in Vietnam to contribute to the Vietnamese target of net zero by 2050.