Thai SCG’s chemicals operations Q2 profit falls 19%, sales up 30%

27 July 2011 11:48  [Source: ICIS news]

SINGAPORE (ICIS)--Siam Cement Group’s (SCG) chemicals business posted a 19% year-on-year fall in profit to baht (Bt) 2.50bn ($84m) in the second quarter of 2011, but sales grew a strong 30%, the Thailand-based industrial conglomerate said on Wednesday.

The segment’s sales substantially increased to Bt49.5bn, with a strong contribution from the company’s new chemicals complex in Map Ta Phut, SCG said in a statement.

Chemicals’ earnings before interest, tax, depreciation and amortisation (EBITDA) from operations, meanwhile, slumped 41% year on year to Bt2.04bn in the June quarter, SCG said in a statement.

The financial results in the three months to June reflected an inventory loss from the rapid decline in ethylene prices, reversing the inventory gain recorded in the first quarter, SCG said.

Its high density polyethylene (HDPE)-naphtha margin declined $60/tonne quarter on quarter to its lowest since 2002, the company said.

Prices of HDPE in the second quarter rose by $17/tonne quarter on quarter to $1,389/tonne but naphtha prices spiked $77/tonne to $993/tonne over the same period, it said.

In the first half of the year, SCG’s chemicals segment recorded a 19% year-on-year increase in profits to Bt7.29bn on the back of a 46% surge in sales.

Meanwhile, SCG’s overall net profit in the second quarter rose 3% year on year to Bt7.5bn, with sales jumping 21% to Bt93.9bn on the back of higher product prices and chemicals volume, it said.

The company’s EBITDA rose 15% year on year to Bt14.2bn in the second quarter of 2011.

In the first six months of 2011, SCG’s profit was up 18% year on year to Bt16.7bn as sales increased 28% year on year to Bt186.4bn.

($1 = Bt29.68)

By: Nurluqman Suratman

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