SCG announced 2017 Operating Results as satisfactory, thanks to the company’s strategy of being promptly adaptable to change in the market and consumer needs

SCG began business in Myanmar more than 20 years ago. They have 340 employees as of Q2/2015 and operate as importers of cement and other building materials.  SCG announced the 2017 Operating Results as satisfactory, thanks to the company’s strategy of being promptly adaptable to changes in the market and consumer needs, as it prepares to continue to expand its service business.

Despite risks such as costs of raw materials and energy, the strengthening Thai Baht, and regional competition coming this year, the company focuses on a strategy of collaborations with digital startups and equipping employees to be adaptable to change, as well as an expansion of its service and logistics business. This will help SCG to stay competitive. Meanwhile, its investments in ASEAN are progressing according to plan.

Mr. Roongrote Rangsiyopash, President and CEO of SCG, disclosed the company’s unaudited Operating Results for FY2017, with registered Revenue from Sales increase 6% y-o-y to 18,127 Billion MMK (US$ 13,286 Million) from higher chemicals prices, while Profit for the Period reached 2,213 Billion MMK (US$ 1,622 Million), a decrease of 2% y-o-y, mainly from strong competition in Cement–Building Materials business.

On a quarterly basis, SCG’s Q4/2017 Revenue from Sales increased 14% y-o-y to 4,705 Billion MMK (US$ 3,442 Million), mainly due to higher chemicals product prices and slightly increased 1% q-o-q. Profit for the Period reached 521 Billion MMK (US$ 381 Million), an increase of 1% y-o-y and 6% q- o-q.

In the Myanmar market, SCG’s Q4/2017 Revenue from Sales amounted to 84,066 Billion MMK (US$ 61 Million), which includes sales from both operation in the country and imports from the Thai operations. This represents an increase of 60% y-o-y mainly from the operation of cement factory which has started operating last year. The 2017 Revenue from Sales recorded 337 Billion MMK (US$ 247 Million).

For the past few years, Myanmar has shown an increase in residential and commercial projects from foreign investments. Several projects required international standard of building construction materials and systems. SCG captured these opportunities by offering co-design solutions to the contractor segment, for example post-tension concrete slabs and panels as well as concrete piles that help reducing cost and time of construction. This is one of SCG’s response to the need of country to have the higher level of construction technology. Furthermore, it has initiated COTTO bathroom design service for homeowners who are looking for more than product’s functionality called ‘COTTO STUDIO’ where company’s designers can consult to each customer to meet their requirements and styles. In addition, SCG introduced wood substitute products which customer can use in a variety of applications with better durability and value for money. 

2018 brings certain risks such as rising costs of raw materials for chemicals and packaging, higher energy costs, a strengthening Thai Baht, as well as an intense competition in the region — especially for the cement industry. To mitigate and prepare for these risks, SCG will continue to expand its services and solutions business, and utilize automation and robotics technology to help maximize business efficiency. In addition, the company has established the Reskill Training Program to develop our employees capabilities so that they are able to navigate the changes and serve the needs of customers as well as expand internationally in the future.”

SCG has also invested in startups that focus on digital and logistics businesses to allow customers to have access to SCG Logistic’s delivery trucks via a digital platform, offering a more convenient and faster service. There are more than 7,000 trucks throughout the ASEAN region.

In addition, SCG also continues to focus on High Value Added products and services to quickly respond to the needs of consumers. In the past year, the company has invested more than 167 Billion MMK (US$ 123 Million) in research and innovation, accounting for approximately 0.9% of its total Revenue from Sales. Sales of HVA products in 2017 totaled 7,057 Billion MMK (US$ 5,172 Million), approximately 39% of the total Revenue from Sales.

Meanwhile, collaborations with digital startups are progressing well, with more than 40 ongoing projects with potential for commercialization. The company also sees business opportunities to connect with startup networks in the USA, Israel, and China.

“SCG has also acquired a 68.3% stake in Interpress Printers, a leading manufacturer of fast food packaging in Malaysia with the market cap of 104.5 million Malaysian ringgit or approximately 836 million Baht. The acquisition will benefit SCG’s development of fast food packaging for the fast growing consumer demands in ASEAN,” said Mr. Roongrote.

(Myanmar Business Today: https://www.mmbiztoday.com/articles/scg-announces-2017-operating-results-continues-adapt )

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