Siam City double-digit rise in earnings and sales

Siam City Cement Co (SCCC) reported a double-digit rise in earnings and sales during the first quarter of 2014, as higher cement prices and increased exports help offset declines in its domestic market of Thailand.

SCCC said yesterday to the Stock Exchange of Thailand that earnings rose 56 per cent YoY to THB1.9bn as net sales rose 14 per cent to THB8.65bn. Thailand’s second-largest cement producer attributed the rise in revenue to higher average selling prices and a rise in exports despite a drop in domestic sales during the period.

Key energy-saving initiatives continued to stabilise production costs. Overall cement production costs per tonne were slightly lower than last year as a result of lower fuel costs, especially the average coal price.

Going forward, the company cautions that ongoing political tension and delays in government spending could weaken the company’s 2014 outlook.  "We envisage tapering domestic volume for the rest of the year compared to the prior period. Despite all the challenges ahead, to protect our 2014 operating results the company initiated plans for cost savings, securing long-term volume for both domestic and exports while maintaining price levels,” said the statement.

Director and chief executive Vorathep Rangchaikul recently said the company might post marginal or flat growth this year, as the prolonged conflicts have hurt domestic consumption. Local cement demand will likely expand by just 2-3 per cent this year, he said, adding that the company plans to boost exports and cut expenses under these conditions.