ASEAN KEY DESTINATIONS
Siam Cement looking at US investment
Siam Cement Group (SCG) is in talks to acquire a US petrochemical firm.
SCG may increase its five-year investment budget from 100 billion baht as the country's top industrial conglomerate is spreading its investments outside Southeast Asia.
SCG projects total revenue will rise by about 10% this year. Yesterday, it reported a 26 percent jump in total revenue to 301.3 billion baht for 2010, well above the 10 percent forecast. The industrial conglomerate also posted a record-high net profit of 37.38 billion baht last year, a rise of 54 percent year-on-year with earnings growth in most key businesses and dividends.
SCG Chemicals accounted for almost half of the group's revenue, with sales of 144 billion baht, up 43 percent. Its earnings surged 80 percent to 22.6 billion, thanks to an 8.8-billion-baht extraordinary profit from the divestment of its shares in PTT Chemical in the final quarter. The paper business earned 51.7 billion baht in revenue, rising 21 percent, as net profit grew 53 percent to 3.49 billion.
The cement unit, meanwhile, reported a 3 percent drop of earnings to 6 billion despite the 5 percent increase in revenue to 48.95 billion.
In last year's fourth quarter, the group's earnings jumped by 213 percent to 16.67 billion baht on sales of 76.25 billion, an increase of 23 percent from the same period of 2009.
President and chief executive Kan Trakulhoon said rising interest rates and high oil prices might affect domestic consumption of industrial products by pushing up their prices. SCG consequently might be forced to export more with lower margins.
Export revenue amounted to 30 percent of the group's total sales last year, with another 7 percent earned from subsidiaries operating in Asean, he added.
Given revenue and profit growth, Mr. Kan said the group now has extra cash of 70 billion baht with net debt reduced from 120 billion baht to below 84 billion.
"Our financial status is now the strongest historically, enabling us to be more proactive in overseas investments. There is a possibility that our five-year investment plan (2011-15) will be higher than 100 billion baht announced earlier," said Mr. Kan.
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