Displaying items by tag: Siam Cement

Laos: Siam Cement Group plan to build a US$370m cement plant in Laos. The 1.8Mt/yr plant is expected to start production in the second quarter of 2017.

"This plant is meant to serve the greater Mekong region," said President and CEO of Siam Cement, Kan Trakulhoo. Siam Cement intends to continue investing within the Association of Southeast Asian Nations (ASEAN) which is set to introduce a common market at the end of 2015.

Siam Cement's revenue for the first quarter of 2014 increased by 11% year-on-year to US$3.74bn. Kan added that political tension in Thailand has affected demand for cement in that country. Subsequently, the company is shifting its emphasis to exports.

Thailand: Siam Cement Group (SCG) is poised to revamp its business plans to cope with the impact of the political turmoil and adverse economic outlook, setting its sights on more exports and trading with the Asean market.

President and chief executive Kan Trakulhoon said that the country's prolonged political problems and the absence of a functioning government have affected the operational plans of SCG. According to Trakulhoon, the existing business plan called for the company to cut cement shipments from 5Mt in 2012 to 4Mt in 2013 and 3Mt in 2014, to better serve domestic consumption. However, given the unfavourable market conditions in Thailand, SCG will keep cement exports at 4Mt in 2014, with Myanmar, Cambodia and Vietnam as the target markets.

"The overall market of cement and construction materials has shrunk over the past couple of months thanks to the sluggish economy, which has been hit by the prolonged political problems,'' said Trakulhoon. "Earlier we forecast that the two industries should grow by 8 - 9% in 2014, but now we see they will grow at best by 4 - 5%."

According to Trakulhoon, sales of cement and construction materials fell by 7 - 8% during January and February 2014 against the 4 - 5% growth that SCG had projected. Normally late December 2013 until April 2014 is the peak selling season for products in this group, as people build and renovate their homes.

Cement and construction materials are expected to be harder hit in the second and fourth quarters of 2014 as the construction and property business slows down in line with tepid economic prospects and a lack of new private investments because of the absence of a new Board of Investment (BoI). Investment proposals worth US$15.3 – 18.4bn are still awaiting approval from the BoI's main board, which has yet to be appointed because of the political crisis since October 2013, when board member terms expired.

SCG itself has one project, a joint venture with a Japanese partner, which is pending approval from the BoI. The company also has two other joint venture investment projects with the Japanese investors waiting to submit the investment privileges with the BoI.

Trakulhoon said that he remains upbeat that SCG's sales revenue would grow by at least 10% in 2014, up from US$13.3bn in 2013. Domestic sales are expected to make up 65% of the group's sales revenue in 2014, with overseas sales contributing the remaining 35%, 20% of which will come from Asean nations.

Myanmar: Thailand's Siam Cement Group (SCG) aims to produce nearly 2Mt/yr of cement at its new plant in Myanmar once the US$400m plant starts operations in 2016.

"Our new plant in the country is expected to produce 5000t/day, which is about 2Mt/yr," said Chana Poomee, country director of SCG in Myanmar. "We see a lot of potential in Myanmar because we consider it an Asean 'mid-land.' There are very good opportunities here. We believe in the future of Myanmar, so we've decided to invest," he said. He noted that construction had progressed well, with full support from the government and Mon State.

A new 20km road is being constructed while the company repairs many roads in the state. The SCG country director also emphasised that the company had launched a number of corporate social responsibility (CSR) activities to improve the lives of people in Myanmar, which include public health and medical programmes, educational support for students and community-building activities. The firm's CSR activities also include building new schools near the plant, mobile clinics that will provide medical services to the people and renovation of pagodas in Mon State.

"We hope to be able to improve the livelihoods of people in Myanmar through economic, social and environmental development, just as SCG is doing in the other markets that it operates in," Chana said.

He added that the local residents were satisfied with the implementation of the new cement plant. "It took a long time for us to discuss the project with the government and the people. I am sure the local people will be satisfied with our plant thanks to our community-building programmes, which will be beneficial to all of them," said Chana.

In recent months, the firm has begun engaging with the communities around the plant site to inform them about the planned developments. "We will introduce environmentally friendly technology such as waste-heat power generation and greenhouse-gas reduction. It may be better than our plant in Thailand because of the up-to-date technology that will be used in this plant," Chana said.

Myanmar: Citic Heavy Industries has signed a 5000t/day cement production line EPC general contract with Maylamyine Cement, a Myanmar-located subsidiary of Thailand's Siam Cement Group. The contract is valued at US$197m.

Laos: A leading Thai cement company, widely speculated to be Siam Cement Group (SCG), will co-invest with Lao-Phatthana Cement Industry Co, a unit of Souksomboon Group, in the construction of a US$330m cement plant in Khammouane, Laos.

Chaovalit Ekabut, SCG's chief financial officer and vice-president for finance and investment, declined to comment on whether the Thai cement producer is SCG, but said the group continued to explore opportunities in the Asean countries.

Chittakorn Souksomboon, president of Souksomboon Group, said that the Khammouane plant will have a clinker capacity of 1.6Mt/yr. The clinker will become 2.2Mt/yr of OPC and blended cement, with half serving the Laotian market and the rest exported to Thailand. The plant is due to be completed at the end of 2015 or early 2016.

"The possible Thai partner with 100 years of history is interested in jointly investing with us because we have a 50-year concession from the Laotian government to operate a limestone mine on 3875m² nearby," said Souksomboon. The Souksomboon Group is keen to forge a partnership with a Thai cement firm because it wants to sell construction materials through a Thai hardware chain in the future.

Cement demand in Laos is forecast at 3.5Mt/yr, but supply is just 1.7Mt/yr. The landlocked country must import cement from China and Thailand. The Laotian economy is growing robustly with infrastructure projects such as roads, double-track rail and dams being developed ahead of the Asean single market comes into being in late 2015.

Souksomboon Group already runs a cement plant in Vientiane, Laos and is building a plant in Nakhon Phanom, Thailand, which is due to be completed in 2014.

Philippines: Thailand-based Siam Cement Group seeks to put up a manufacturing facility for fibre cement boards, smart boards and ceramic tiles, The Nation reports. These planned projects would cater to not only the domestic market but also SGC's markets across the Asean nations.

"If the products are marketable here, we plan to produce those products here. Investments would depend on market size. For example, for fibre cement board, we need (to be able to sell at least) 5Mm² to (justify the cost of putting up a facility). The current local demand is 30Mm²," said Surasak Kraiwitchai-charoen, international business director of SCG Building Materials Group in Thailand.

Myanmar: Siam Cement Group (SCG) has announced that it will build a 1.8Mt/yr greenfield cement plant costing US$386m in Mawlamyine, Myanmar. The plant will include a 40MW captive power plant, a 9MW waste heat recovery system, supporting port facilities and other infrastructures for future expansion.

"The Myanmar cement market is estimated at approximately 4Mt in the 2012 financial year and is forecasted to grow at 10%/yr over the next five years," said president and CEO of SCG, Kan Trakulhoon.

Built under Myanmar's Foreign Investment Law, the cement plant is expected to start in mid-2016.

Thailand: Siam Cement Group (SCG) has reported that its revenue rose by 10.5% year-on-year to US$412m for the three months ending on 30 June 2013 from US$373m. Net profit for the period rose by 10.3% to US$369m from US$334m.

Chief executive officer Kan Trakulhoon said that SCG will acquire a company that makes roofing products in Cambodia, Laos, Vietnam and the Philippines, extending a strategy of expansion in Southeast Asia to access rising incomes in countries neighbouring Thailand.

Indonesia: Thai cement giant Siam Cement Group (SCG) will further expand its presence in Indonesia by building a new cement plant and acquiring more companies in the country, according to a company executive.

Chief finance officer Chaovalit Ekabut said that SCG expected to start the construction of a greenfield cement plant in Sukabumi, West Java with a total investment of US$356m."We expect to start construction this year and finish by 2015. We hope to commence operations at this cement plant in the second half of 2015," Chaovalit said on 27 February 2013.The cement plant will have a production capacity of 1.8Mt/yr.

Chaovalit added that SCG had decided to be careful and make small-scale investments in the cement market in Indonesia, which has grown rapidly on the back of increased housing demand and infrastructure projects.

"Some projections calculate that cement capacity (in Indonesia) may reach 100Mt/yr in another five to six years. This is very dangerous because you face a kind of bubble. When the demand seems to be very high, people build more and more plants and then everything stops and you end up having so much extra capacity," Chaovalit said."I hope we shall not fall into the same trap again. Companies should look at the market and continue to invest to serve the demand and not to overexploit something that is not real."

Thailand: Siam Cement has reported that it has more than doubled its quarterly net profit as Thailand rebuilt from floods and demand for construction materials and petrochemicals surged. Southeast Asia's second biggest cement maker posted a net profit of US$232m in the October 2012 to December 2012 period, a rise of 116% compared to US$107m in the same period in 2011. Revenue from sales rose by 14% to US$3.35bn.

"An increase of 116% year-on-year was largely due to the sales recovery of the construction-related businesses from floods in the fourth quarter of 2011," the company said in a statement.

Year-on-year increases in revenue and sales were more modest when compared to the previous quarter in 2012. Revenue fell by 4% compared to the July 2012 to September 2012 period and profit increased by 8%. Revenue for the company's cement sector rose by 36% to US$576m in the fourth quarter of 2012. Profit rose by 75% to US$71.1m.

In its statement Siam Cement reported that its export market sales volume dropped by 30% quarter-on-quarter to 1Mt due to seasonal factors and tight supply as a result of plant maintenance. On year-on-year basis, export volume decreased by 22% as a result of the conversion of exports volume to serve the domestic market. Earnings before interest, taxes, depreciation and amortisation (EBITDA) increased by 42% year-on-year due to the better domestic cement market but decreased by 12% quarter-on-quarter to US$117m due to plant maintenance and higher electricity costs.

Siam Cement is Southeast Asia's second largest cement maker with a cement production capacity of 24.2Mt/yr. It is 30% owned by the Thai Royal family's investment arm, the Crown Property Bureau. The company said future profit growth would be partly driven by construction across the developing Southeast Asian nations, where it aims to invest $6.7bn between 2013 and 2017.