Siam Cement Company (SCC) is expected to report a 1Q09 net profit of Bt4.3bn, down 39.0% YoY but turning from a net loss of Bt3.5bn in 4Q08. Stripping out extraordinary items, normalized profit is expected to be Bt4.3bn, down 37.2% YoY but turning from net loss of Bt3.6bn in 4Q08. The drop YoY would be due to dips in sales volumes for its chemical, cement, and paper units on dwindling demand during the economic slowdown, as well as a reduction in dividend income and equity income. Meanwhile, the QoQ improvement would be from the absence of huge inventory losses, notably from its chemical unit, of Bt5.0bn that it encountered in 4Q08, and an increase in sales volume for each unit on seasonality.
SCC’s 1Q09 cement EBITDA is expected to be Bt2.9bn, down 6.8% YoY but up 24.7% QoQ. The YoY drop would be from the contraction in local and export cement sales volume of 15.0-25.0% YoY offsetting the increase in domestic and export cement prices of 5.0-10.0% YoY. Meanwhile, the QoQ would be backed by an increase in domestic cement sales volume of 13.0% QoQ from seasonality outpacing a dip in export cement sales volume of 16.7%.