26 January 2021
SCGP announces FY2020 revenue growth amid economic challenges; Continues to invest in related businesses to stay ahead in ASEAN
SCGP grows from strength to strength during 2020 amidst the enomomic challenges as the result of the pandemic. Sales revenues reached 92,786 million baht, an increase of 4% compared to 2019, and a net profit of 6,457 million baht, an increase of 23%compared to 2019, all resulting from the business model offering diverse packaging solutions fulfilling increasing customer needs as well as effective management of supply chains and addition of downstream packaging portfolios. The year 2021 will see continuous investment plans in ASEAN, especially on downstream packaging businesses as well as development of innovative products and business operations based on the ESG framework.
Mr. Wichan Jitpukdee, Chief Executive Officer, SCG Packaging Public Company Limited, SCGP, reveals that while the global economy was facing an upheaval as the result of the COVID-19 pandemic, the company was able to maintain steady growth during 2020. It achieved sales revenues of 92,786 million baht, an increase of 4% compared to 2019, a net profit of 6,457 million baht, an increase of 23% over last year’s, and EBITDA (Earnings before interest, tax, depreciation and amortization excluded dividend from associates and included FX gain/loss from loans from Q1/2019 onward) of 16,876 million baht, an increase of 11%.
SCGP’s impressive growth resulted from its ability to offer a wide diversity of packaging solutions, and effective management of costs, raw materials and supply chains, allowing for production most suitable to the situation. An expansion of its downstream packaging business and its merger and partnership strategy to expand its base in ASEAN as well as its close cooperation and synergy with PT Fajar Surya Wisesa Tbk. and Visy Packaging (Thailand) Limited have helped SCGP to achieve its growth.
The company’s performance in the fourth quarter of 2020 was similarly impressive compared to that of last year. Its sales revenues amounted to 23,596 million baht, increasing 2% over the same period of the previous year, resulting in net profit of 1,486 million baht, increasing 24% over the same period of the previous year, and EBITDA of 4,211 million baht, increasing 9% over the same period of the previous year.
The company’s revenue growth resulted from increased packaging demand in the food and beverages, consumer goods and foodservice sectors, especially during the end-of-year festive season. Economic stimulus measures in Indonesia also contributed to the growth.
The situation in several countries has improved. Countries’ economic stimulus measures, increasing demand for packaging for consumer goods and food and beverages, food safety packaging, and e-commerce growth all contributed to SCGP’s increased sales during the last quarter of the past year.
During the fourth quarter of last year, SCGP has invested in Bien Hoa Packaging Joint Stock Company (SOVI) in Vietnam to expand its downstream packaging business and strengthen its upstream packaging operations in the country. SCGP’s latest investment in Go-Pak UK Limited (Go-Pak), a leading foodservice packaging producer, will enable the company to expand its market to the UK, Europe and North America with a wider variety of packaging products.
The investment in SOVI and Go-Pak is expected to increase revenues by 5,000 million baht a year and boost the company’s ability to provide completely integrated packaging solutions.
The SCGP CEO adds that the company has earmarked a capital expenditure plan of approximately 20,000 million baht for the year 2021, targeting downstream packaging in ASEAN. Meanwhile, the company’s projects to boost its production capacity of paper packaging in Indonesia and the Philippines and of polymer packaging in Thailand will be completed and ready for operation within the current year.
In consideration of the FY2020 financial performance, the Board of Directors has proposed for shareholder approval at the Annual General Meeting (AGM), a full year 2020 annual dividend payment of 0.45 Baht per share, with a payment date of 22 April 2021, record date of 8 April 2021, and XD-date of 7 April 2021.
Mr. Wichan explains that SCGP has laid down effective management plans to enlarge its customer base in the consumer goods industry in order to cope with anticipated expansion of the packaging industry in the region as the pandemic situation improves and the economy begins to recover. He expects that the demand for packaging for food products, consumer goods, and personal care and hygenic products will continue its upward trend this year. In the longer term, the packaging industry is expected to benefit from increasing relocation of production bases to ASEAN.
The SCGP CEO concludes that SCGP is firmly committed to operating its businesses within the environmental, social and corporate governance (ESG) framework.
The company attaches great importance to its social and environmental responsibilities. It will make effective use of resources by increasing the proportion of renewable energy as well as developing innovative packaging products that help conserve the environment and improve consumers’ quality of life. The example is R-1, innovative flexible packaging that comprises multiple layers to offer unique of high-impact resistance, content protection, and recyclability , which SCGP in cooperation with Dow Thailand Group and Khao Tra Chat have developed R-1 to environment-friendly rice bags that is 100% recyclable and is in accordance with the Circular Economy principle by reusing resources to its utmost utility.
27 July 2021
SCGP maintains healthy growth with first half-year earnings of THB57,148M And with plan for progressive growth in the year’s second half
23 July 2021
SCGP forms a partnership with Duy Tan in Vietnam To diversify packaging products and meet demands in ASEAN