SCG reported strong operating results in Q3/2021, despite a decline in profitability due to the region's lockdown and higher energy and raw material costs in the global market.
|Roongrote Rangsiyopash, president and CEO of SCG |
Roongrote Rangsiyopash, president and CEO of SCG, disclosed that the company’s unreviewed operating results for Q3/2021 registered sales revenues of VND94.16 trillion ($4 million), a drop of 1 per cent on-quarter, Normalised profits for the period stood at VND6.48 trillion ($275 million), a decrease of 47 per cent on-quarter on lower chemicals product spreads and equity income. Meanwhile, profits for the period including asset impairment of the cement plant in Myanmar and gains from fair value adjustments of investment totalled VND4.74 trillion ($207 million), down 60 per cent on-quarter.
In Q3/2021, SCG’s total assets in Vietnam amounted to VND135.95 trillion VND ($5.98 billion), an increase of 57 per cent on-year, mainly from the chemicals business. The company reported Q3/2021 sales revenues of VND6.89 trillion ($301 million), a 4 per cent increase on-year, mainly stemming from export sales from Thailand to Vietnam. Compared to the previous year's performance, sales revenues increased 31 per cent thanks to the rising chemical product prices, while normalised profits for the period fell by 11 per cent due mainly to the new wave of the pandemic and regional lockdowns which affected the cement-building materials business. Profits for the period including asset impairment and gains from adjustments of investment dropped 30 per cent.
Long Son Petrochemicals Co., Ltd. in Vietnam has completed 87 per cent of its planned progress and will begin commercial operations in the first half of 2023.
|Biomass usage illustrates the commitment to prepare for potentially higher fuel and raw material costs |
Roongrote said, “SCG’s financial position remains strong despite a dip in profits as a result of regional lockdowns and higher fuel and raw material costs. SCG has strengthened its Environmental, Social, and Governance requirements to prepare for potentially higher fuel and raw material costs and strong inflation, which is projected in the future. To address this challenge, SCG has accelerated risk management by signing future fuel contracts, selecting raw materials appropriate for market conditions, and increasing the proportion of alternative energy."
However, it is expected that after the country's reopening, purchasing power would return as businesses and consumers adapt to living with COVID-19, like in many other countries, which is a healthy sign of global and domestic economic recovery.
SCG is preparing to seize opportunities for long-term growth through green and wellness products such as SCG Green Choice, which reduces the use of natural resources while saving energy and promoting good hygiene, and CPAC Green Solution, which uses digital technology to increase construction speed, reduce dust pollution, and cut construction waste. Furthermore, it continues to invest in eco-friendly businesses, such as the production of bioplastics.
SCG Chemicals aspires to be sustainable by implementing energy-saving projects and speeding the expansion of its circular economy business. It recently signed an MoU with Braskem to explore the feasibility of entering joint ventures to build a bio-ethylene plant in Thailand to address the demand for bioplastics. In terms of the progress of the share acquisition of Sirplaste, Portugal's leading plastic recycler, the shares are expected to be transferred by the end of the year.
|SCG Chemicals signed an MoU with Braskem to explore the feasibility of entering joint ventures to build a bio-ethylene plant in Thailand to address the demand for bioplastics |
Meanwhile, the advanced recycling demonstration plant has been ISCC PLUS certified. Additionally, RIL Industrial Estate under SCG Chemicals has received the Eco-World Class certificate, the top tier certification by the Industrial Estate Authority of Thailand for three years in a row, making it the first in Thailand to sustain these continued achievements.
The cement-building materials business aims to secure more renewable energies by acquiring agricultural waste to use as fuel, recycling waste heat generated from the cement manufacturing process, and boosting the use of solar power from solar farms and floating solutions.
SCG strives to develop a diverse range of packaging innovations to fulfill the needs of customers and the megatrends of the Thai and ASEAN economies. SCG has implemented a number of technologies to assist with operations, including mechanisation, automation, and AI to assess, predict, improve production efficiency and product quality.
SCG also works on packaging innovation that may be reintroduced into the recycling process and increase the share of renewable energy in the manufacturing process. Meanwhile, the company will continue to expand through organic and inorganic expansion to become ASEAN's integrated packaging solutions provider and meet the growing need for consumer packaging.