SCG achieved 57 percent growth in profit for Q3 2020 in its operating results on the back of recovery in the global chemical market, an increase in the proportion of HVA products, strong packaging business and transformation efforts in the cement-building materials business. SCG is well on track to achieve continued growth despite the challenges brought about by the COVID-19 pandemic.
SCG President and CEO Roongrote Rangsiyopash disclosed, “The company’s unreviewed operating results for Q3 2020 registered a PHP157,371 million (US$ 3,222 million) revenue from sales, an increase of 5 percent QoQ. Profit for the period totaled PHP 15,187 billion (US$ 311 million), up 4 percent QoQ, thanks to the better performance of the chemicals business on the back of improving demand in Asia and stronger cement-building materials business. Compared to last year’s performance, revenue from sales dropped 9 percent while profit for the period rose to 57 percent.
Operating results for the first nine months of 2020 show SCG registered a revenue from sales of PHP322,775 million (US$ 9,602 million), a 9 percent dip YoY due to decreased chemicals selling prices in line with the oil price drop. Profit for the period totaled PHP1,656 million (US$ 828 million), up 5 percent YoY as a result of increased contributions from the cement-building materials and packaging businesses. The overall business has remained agile and responsive as technologies are harnessed to streamline the entire supply chain.
SCG has revamped its High Value-Added Products & Services (HVA) strategy by strengthening the criteria to increase competitiveness in the global market and maintaining agility to stay relevant amid rapidly changing customer needs. Under the new standards, SCG’s revenue from HVA sales for the first nine months of 2020 hit PHP5,938 million (US$ 2,969 million) or 31 percent of total revenue from sales.
SCG’s revenue from performance businesses outside of Thailand, including export sales from Thailand, for the first nine months of 2020 reached PHP8,180 million (US$ 4,090 million) or 43 percent of total revenue from sales. The figure was slightly lower than the previous year.
SCG in ASEAN (ex-Thailand)
For SCG’s operations in ASEAN (ex-Thailand), revenue from sales in Q3 2020 recorded a 15 percent decrease YoY at PHP39,266 million (US$ 804 million), which is 25 percent of SCG’s total revenue from sales. This includes sales from both local operation in each ASEAN market and imports from Thai operations.
As of September 30, 2020, SCG’s total assets amount to PHP1,105,053 million (US$ 22,838 million) while the total assets of SCG in ASEAN (ex-Thailand) are valued at PHP1,033,468 Million (US$ 23,652 million). These make up 38 percent of SCG’s total consolidated assets.
Meanwhile, SCG in the Philippines owns PHP13,182 million (US$ 255 million) worth of total assets, an increase of 45 percent YoY mainly from the packaging business. The company reported a Q3 2020 revenue from sales of PHP3,335 million (US$ 68 million), which includes sales from both operation in the country and imports from the Thai operations. This represents a decrease of 17 percent YoY mainly from Thailand exports. For the first nine months of 2020, SCG’s Philippine market reported a revenue from sales of PHP8,682 million (US$ 174 million), a 31 percent decrease YoY mainly from the packaging business and cement-building materials operations and export from Thailand.
SCG in motion
The SCG Cement-Building Materials Business secured continued growth with holistic service solutions. Among these solutions is CPAC Construction Solution, which leverages advanced technology and SCG’s high-quality products and expertise to provide end-to-end construction solutions. SCG also recently secured a large-scale mat foundation concrete pouring project for One Bangkok with a total amount of concrete of 27,300 cubic meters. This marks the largest continuous mat foundation concrete pouring in Thailand and Southeast Asia. Another product is the Lifetime Solution, which facilitates comprehensive building and infrastructure maintenance and repair services. The service is set to expand the coverage to ASEAN.
The SCG Packaging Business has continuously remained strong for Q3 2020. SCG Packaging (SCGP) is committed to enhancing an eco-friendly product portfolio. It introduced alternative market choices such as the OptiSorb-X, which preserves packaged content and expands shelf life. SCGP also debuted shares on the Stock Exchange of Thailand (SET) in October and closed at THB35, marking a significant milestone for SCGP as a public company. SCGP is also acquiring a majority stake at Bien Hoa Packaging Joint Stock Company (SOVI) in Vietnam to fortify its position and competitiveness in the ASEAN. The acquisition will be completed by December 2020.
“The Q3 2020 operating results and the first nine months of 2020 showed favorable growth for SCG despite the COVID-19 pandemic. The recovery in the chemicals market and notable HVA product improvements seen in the agricultural, automotive and durable goods sectors contributed greatly to this result. Similarly, the packaging business’ unique business model offered end-to-end solutions for continuous growth. SCG has maintained a state of readiness to explore business opportunities, prepare for a market upturn and build a long-term growth trajectory. Business transformation efforts have enabled the company to move swiftly and stay ahead of the curve,” Roongrote shared.
Developing opportunities amid the pandemic
SCG Marketing Philippines Inc. continues to provide a full range of home and living solutions to customers with new products such as Smart Insulation, Smart Screws and Smart Frames. This is in preparation to offer full wall and ceiling ecosystems. This also promotes integrated solutions, which will strengthen partnerships with technology providers, developers and end-users.
Mariwasa Siam Ceramics, Inc., the forefront of the ceramic tile manufacturing industry, introduced Mariwasa Tile Adhesive Heavy Duty. The product’s improved formula makes it more suitable for big size applications on the floor and wall, especially on non-absorptive tiles. Mariwasa will also launch Skim Coat Superfine White, which is formulated to smoothen old and uneven surfaces for a quality finish. Mariwasa LVT & SPC, a premium quality vinyl flooring inspired by nature and specially designed for home and commercial applications, is also in the pipeline. The launch of these new products aims to provide the industry with total construction solutions.
SCG also continues to ensure the safety of medical personnel in the Philippines by donating Negative Pressure Mobile Isolation Units. Recently, SCG donated units to Sto. Tomas City, Batangas; Calumpit, Bulacan; and the Veterans Memorial Medical Center.