Siam City Cement 1Q sales rise, net profit hit by higher costs, Thailand

Siam City Cement Co (SCCC), Thailand’s second-largest cement producer, reported a decline in operating and net profit for the 1Q13 despite a rise in sales as higher electricity and transport costs negatively affected results.

Net profit for the three months to the end of March 2013 was THB1.12bn (US$37.7m), down 5.4 per cent on the same quarter of last year.

Sales, however, were up 8.4 per cent YoY to THB7.5bn from THB6.9bn in the same period of last year. The rise was attributed to infrastructure projects, commercial developments and the expansion of the real estate sector. Revenues were also higher thanks to higher price realistation despite a significant reduction in clinker exports, the company said. Production costs continued to increase due to higher electricity unit rates and transport costs, leading to a slightly lower operating profit compared with the previous year.

Other construction-material businesses also increased volumes and prices on strong overall business expansion. Energy-saving initiatives such as waste-heat recovery and alternative fuels generated additional benefits.

SCCC forecasts that cement consumption will post strong growth for the remainder of 2013 because of planned public infrastructure projects, the development of transport and logistics routes, and the expansion of modern retail channels.