Siam Cement prepares for property revival

Buoyed by strengthening demand for real estate, the Siam Cement Group plans to operate at 60% of its production capacity this year, churning out 15.4 million tons, up by 1.4 million tons from last yea…

Buoyed by strengthening demand for real estate, the Siam Cement Group plans to operate at 60% of its production capacity this year, churning out 15.4 million tons, up by 1.4 million tons from last year. The plant“s output is sold equally on the domestic and export markets. Its annual capacity is 23 million tons. Annual demand for cement in Thailand stands around 18 million tons compared with a local production capacity of 50 million. However, the lift in local demand has lifted retail prices by 25% to 50% depending on the mix and brand. The company expected to pay a dividend of up to 30% of its net profit next year, assuming there would be an improved performance. The company was scheduled to pay a dividend of THB 10 a share on 22 April, about 15% of its net profit last year. It will be the first dividend since THB 20 a share was paid in 1997 on the previous year“s performance before the financial crisis in Thailand. Siam Cement reported an operating profit before special items of THB 4.79 billion in 2001 and earnings per share of THB 39.97, both figures higher than in 2000. The net operating profit was THB 7.63 billion, part of which was gains from sales of holdings in non-core subsidiaries. Earnings per share rose to THB 63.62. Unaudited consolidated revenue rose by 4% year-on-year to THB 122.64 billion. Revenue from the cement business rose marginally to THB 24.18 billion while that of the petrochemical business dropped slightly to THB 38.15 billion because of low worldwide prices. Revenue from the paper and packaging business totalled THB 26.99 billion, close to that of the year before. As of 31 December, unaudited consolidated assets amounted to THB 235.98 billion, down from the year before because of sell-offs under its business reorganization programme. Siam Cement decided to issue non-convertible debentures denominated in baht in order to redeem earlier debentures worth THB 30 billion that would mature in September. The debentures would not exceed THB 40 billion and the maturity period would not exceed 10 years. Interest rates would be subjected to prevailing market conditions at the time of issue. Apart from private and foreign placement, the debentures would be offered to the company“s existing debentures shareholders, the public and institutional investors.