SCG posts 32% 4th quarter profit decline, sets transformation plan

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SIAM CEMENT Group Public Co. Ltd. (SCG) reported a 32% fall in fourth-quarter profit to $229 million or P11.95 billion after the decline in its chemical business amid trade war concerns and market volatility that resulted in lower margins.

“Fluctuations driven by uncontrollable external factors has made a significant impact on businesses globally over the past year. As a result, in 2020, SCG is necessitated to develop comprehensive business strategies aiming at conquering disruptions promptly and maintaining sustainable business growth,” said Roongrote Rangsiyopash, SCG president and chief executive officer.

Quarter on quarter, profit rose 15% mainly because of seasonal dividend contributions from the investment business, the regional cement and building materials maker said in a statement on Thursday.

Sales during the quarter hit $3.51 billion. It did not report a comparative quarter-on-quarter figure, but said the period saw lower chemicals and packaging paper prices.

For full-year 2019, SCG posted a profit of $1.03 billion after recording revenue of $14.11 billion. Revenue from the sale of products and services reached $5.77 billion.

The company, which has operations in the Philippines, did not disclose comparative figures. It said without the recognition of severance pay adjustment, its profit last year stood at $1.097 billion.

In the Philippine market, sales revenue during the fourth quarter amounted to $68 million or P3.49 billion. For 2019, revenue hit $311 million. No comparative figures were given.

SCG subsidiary United Pulp and Paper Co., Inc. (UPPC) manufactures industrial grade paper for packaging products in the Philippines, where it celebrated its 50 years in the business in December 2019.

Mariwasa Siam Ceramics, Inc., another SCG unit in the Philippines that manufacturers ceramic tile brand, improved its operation with a new state-of-the-art kiln, which SCG said is considered as the largest in the country.

It said the kiln stands more than 212 meters in length and capable of producing maximum tile size of 800 millimeters x 1,200 millimeters. It also produces an additional output of 5.8 million square meters per year.

Mr. Roongrote said with SCG’s business transformation plan, its three core businesses will shift from being a manufacturer to a solution and service provider “that truly and holistically respond to the diversified and ever-changing customer demand as well as creating high value for the business.” — Victor V. Saulon