Siam Cement, said Wednesday its net profit in the second quarter rose 16 per cent from a year earlier due largely to share divestments.
However, the industrial giant said a 14 per cent drop in operating earnings to THB6.36bn (US$189m) during the quarter reflected the impact of a slowing economy and a strong Thai baht, which hits exports.
Net profit increased to THB8.8bn (US$262m) in the three months to June, while sales were flat at THB63.6bn, the company said in a statement.
"Operating profit dropped due to the weaker performance from all core businesses as a result of the slowdown in the domestic economy and the continued appreciation of the Thai baht," Siam Cement president Kan Trakulhoon said in a statement.
Pushed by strong capital inflows, the baht has appreciated by seven percent against the dollar since the beginning of this year.
Sales in the chemical business, which accounts for nearly half of Siam Cement’s total revenue, were up 2.4 per cent, with the cement business down 4.1 per cent to THB10.3bn due to weaker domestic demand, Karn said.
Hit by low consumer confidence and political worries after a coup last September, Thailand’s economy is seen slowing in 2007 with the central bank recently cutting its growth forecast to 3.8-4.8 per cent from 4.0-5.0 percent.