Siam City Cement PLC. Q1 2019 Performance · 2019. 6. 6. · Cement Grinding Station MMC Terminal &...

1Siam City Cement Public Company Limited ©SCCC | All Rights Reserved.

Siam City Cement PLC.

Q1 2019 Performance

6 June 2019

Disclaimer: Siam City Cement PCL accepts no liability whatsoever with respect to the use of this document or its contents.


Agenda

Company

Market and Business Overview

Financial Highlights

Outlook and Growth


Our Business Portfolio focuses on cement and cementitious materials

Cement Concrete and

aggregates

Light-construction

materials

EnergyWaste

Management

Information

Technology

Chip Mong INSEE Cement

*A JV company in Cambodia with

40% holding

Light Weight Concrete

Supplies Autoclaved Aerated

Concrete Class 4 (G4), which are

light-weight, high strength, fire

resistance and thermal insulation

Fiber Cement

Innovative wood architectural &

decorative products utilizing high

quality cement and recycled

cellulose fibers. Expanding

business internationally,

Indonesia and the Middle East

and Australia

Siam City Power

Utilizes a waste heat recovery

system which converts heat

captured from the cement kiln

to produce electricity

Concrete manufacturing,

significant synergies with

SCCC”s core cement

business

Nationwide coverage network

in Thailand

Mortar

Produces the ready-to-use

cement known as INSEE Mortar

Max, which can be used

instantly by mixing with water

INSEE Mortar Max

Siam City Concrete

INSEE Concrete

INSEE Aggregates

Concrete manufacturing,

significant synergies with

SCCC”s core cement

business

Nationwide coverage network

in Thailand

Coal business

Coal production and

distribution business,

including investments in

coal mining projects in

Indonesia

Secures stable and reliable

supply for coal for SCCC’s

operations

*44.99% holding

INSEE Ecocycle

Offers total waste

management solution.

Obtained 101 and 106

Licenses that allows us to pre-

process and dispose of both

hazardous and non-hazardous

wastes

SCCC Bangladesh

Cement Production capacity p.a.:

SCCC Bangladesh : 0.5 M tons

Siam City Cement

A leading cement producer in Thailand

INSEE Digital

Provides IT services to

INSEE Group.

Plan to expand its services to

external customers soon

INSEE Cement

SCCC Lanka


SCCC Lanka : 2.5 M tons

SCCC Vietnam


SCCC Vietnam : 5.2 M tons


CMIC: 1.8 M tons (under construction)

Industrial Cleaning

Services

Provides specialist

industrial cleaning services

from Valence Corporation

Limited

The range of products and services to satisfy customers across the value chain of the building materials industry

International

Trading

Siam City Cement

Trading

An International Trade

Center of SCCC Group.

Engages all trading

activities/transaction i.e.

buying-selling from both

Group company and 3rd –

party sellers.


SCCC 16.8 M tons (included Globe)


Recent regional expansion set SCCC to become one of market leaders

in Southeast Asia

Second largest cement

manufacturer in Thailand

CAMBODIA

BANGLADESH

SRI LANKA

VIETNAM

Siam City Cement (Bangladesh) Ltd.

Siam City Cement (Lanka) Ltd.

THAILAND

5.2 M tons per year

No.2 market share in

South Vietnam

Globe Cement Co., Ltd.:

0.8 M tons per year

Chip Mong INSEE Cement

Corporation Ltd.

1.8 M tons per year

No.2 market share

2.5 M tons per year

No.1 market share

0.5 M tons per year

Siam City Cement PCL

16 M tons per year

No.2 market share

Siam City Cement (Vietnam) Ltd.

Over 44 billion Baht Net

Sales (FY2018)

Command total capacity of

26.8 million tons per year

Over 5,700 staffs across

region

Indonesia

Fiber cement production capacity

48K tons per year

PT Conwood Indonesia Ltd.


Agenda

Company



Outlook and Growth


SCCC is continuously pushing price improvement initiatives

through value-based selling concept to maximize its profitability

Coal price rebounded in Q1’2019 from a drop during

H2’2018

Thailand – Cement demand continued to recover in Q1’2019In Q1’2019, SCCC further improved its financial performance as a result of a continuous

Business Repositioning, Pricing, Operational Excellence and Channel Management

Siam City Cement:

Total Capacity: 16.8 million tons p.a., (included Globe)

Market Share: Q1’2019 is maintained from Q4’2018 (~27%)

SCCC Thailand – Strategy

• Product portfolio optimization, premium pricing via value

added product and services

• Operational Excellence with cost optimization

• Maintain high capacity utilization

• Business portfolio optimization

• Strategic alliance along construction value chain

• Leverage existing capabilities to find new sources of growth

• Pursue E-Commerce and modern channel management

• New business models to capture the emerging trends

Cement demand slightly shrank Y-o-Y and Q-o-Q

SCCC’s market share in Q1’2019 was maintained Q-o-Q

YTD2017 YTD2018 YTD2019

7Siam City Cement Public Company Limited ©SCCC | All Rights Reserved. 06/06/2019

South Vietnam – Solid demand growth continues

Siam City Cement Vietnam:

Total Capacity: 5.2 million tons p.a.,

Market Share: 23% in 2018

Cement Supply and Demand in South Vietnam

Driving Factors to construction industry• GDP grows over 6% in the medium to long term

• Consistent FDI flow, Disbursed FDI in 2018 USD 19 Bn, up 9% YoY.

Vietnam may benefit further in short term from US-China trade war.

• Positive macro economic indicators, large population of 98 Mio

growing by 1 Mio each year with increasing disposable income and

continued urbanization will further support a healthy economy, in

particular construction growth.

• Construction growth is expected in all segments i.e. residential,

commercial, industrial and infrastructure.

Strategy – SCCC Vietnam• Capture demand growth and defend market share need to build

additional capacity:

• 1.5 Mio. Mt new grinding capacity (Thi Vai) .

• Feasibility study to expand clinker capacity is in process.

• Strengthen position in fast growing bulk segment

• Expand product and service offering (Conwood and Dry mix), while

further strengthening leading position in green products and

sustainable construction.

22.5 23.8 24.9

0

5

10

15

20

25

30

2017 E2018 F2019

Supply Demand

+6%yoy +5%yoy

Supply: 25 million tons

Ba Ria –

Vung Tau

Binh

Duong

Binh Phuoc

Dong Nai

Tay Ninh

An Giang

Bac

Lieu

Ben Tre

Ca Mau

Dong

Thap

Hau

GiangKien

Giang

Long An

Soc

Trang

Tien Giang

Tra

Vinh

Can Tho

Ho Chi Minh City

Vinh Long

Hong Chong Plant

Thi Vai Plant

Hiep Phuoc Plant

Nhon Trach Plant

Cat Lai Plant

Million tons


Sri Lanka - Demand affected this year but gradual recovery is

expected

06/06/2019

Driving Factors

• During 2018-2022, GDP is expected to record ~4%

driven by private consumption, exports and investment.

• Small scale projects are anticipated to grow in short

term due to upcoming elections in 2019.

• Cement demand is expected to grow at ~3%CAGR

during 2018-2022.

Negative Factors

• Slow progress of key infrastructure projects eg.

Colombo Port city, Central expressway

• Investors are on a wait and see approach due to

political instability.

Strategy

• Optimize product portfolio

• Maintain premium positions in both channels

• Strengthen Channel, i.e. RMX, CONWOOD

Siam City Cement Lanka:

Grinding capacity: 2.5 million tons p.a

Market Share: 35% in 2018

Cement Capacity and Demand in Sri Lanka

8.6 8.6 8.9

4.05.4 5.4

6.4 6.0 6.1

0

2

4

6

8

10

2017 2018 F2019

Import capacityGrinding capacityDemand

-6%yoy +1%yoy

Million tons

Limestone Quarry

Galle

Trincomalee

• Kurunegala

Puttalam

• Colombo

•

PCW-Integrated

Cement Plant

Waste Processing Facility

Waste Processing Facility

RCW-Ruhnu

Cement Grinding

Station

MMC Terminal &

Warehouse

GCW-Galle Cement Works

• INSEE Ecocycle

• INSEE Ecocycle

•

Integrated plant

Import terminal

Warehouse

Quarry

Grinding station


Bangladesh – Strong double digit growth in 2018

06/06/2019

Driving Factors

• Country’s GDP has been growing above ~ 6% for last

decade (7.9% in 2017-18). Per capita cement

consumption (~190kg) still low as compared to

emerging economies & peers

• Housing sector : expected to grow very strongly with

increasing rate of urbanization of a huge population

base having ever increasing incomes

• Infrastructure: Government’s key focus to drive and

sustain the economic growth through investment in

infrastructure including power plant, bridges, roads,

elevated express ways, metro rail and flyovers, and

sea ports etc. (~120 bUSD)

Strategy

• Upgrade the existing plant

• Capacity Expansion

Cement Supply and Demand in Bangladesh

4350 54

2731 33

0

10

20

30

40

50

60

2017 E2018 F2019

Supply Demand

+15%yoy

+7%yoy

Million tons

Siam City Cement Bangladesh:

Capacity: 0.5 million tons p.a.

Market Share: 1.6%

SCCBD Grinding Station


Cambodia – Solid volume growth

06/06/2019

Driven Factors

• Investments from China continues to be a key driver of

growth.

• Forecast infrastructure growth to average 10.6%

annually over from 2016-2026

Strategy

• Maintain at full capacity utilization level

• Realize market and operational synergies with

Thailand

• Strengthen Channels.

Cement Supply and Demand in Cambodia

2.8

4.56.25.6

6.06.4

0

1

2

3

4

5

6

7

2017 E2018 F2019

Supply Demand

+7%yoy

+7%yoy

Million tons

Chip Mong Insee Cement:

Capacity: 1.8 million tons p.a.

Market Share: 30%

Sihanoukville

Kampot

RattanakiriStreung Treng

MoldolkiriKratieKg.Thom

Preah Vihear

Odar Meanchey

Bantaey MeancheySiem Reap

BattambangPailin

Pursat

Koh Kong

Takeo

Kg. ChamKg.

Chhnang

Kg. Speu

Kandal

Prey Veng

Svay Reang

PNH

CMIC: full integration plant


Export Market

Price Outlook 2019 Seasonality may affect Spot prices when regional importing markets enters the low season. Balance of 2019 will

be relatively positive as China will be expected to drive market. SCCC’s dependence on the spot market is small as favorable annuals

contracts have been signed at above current market prices.

Decrease from 2018

Exportable excess

Imports

Increase from 2018

Stable


Agenda

Company



Outlook and Growth


Revenue diversification

Q1/2018

Q1/2019

THB million

Group SCCC Q1 2019

Thailand

Oversea

10,904 11,879

+ 15.4% yoy

- 3.7% yoy

+ 8.9% yoy

66:34(%)TH:Oversea

3,553

8,326

3,688

7,216

Chip Mong INSEE Cement*

1,332

Siam City Cement Vietnam

- 2.3% yoy1,6051,643

%Portion 15% 14%

Siam City Cement Lanka

- 7.9% yoy1,5571,690

%Portion 16% 13%

Siam City Cement Bangladesh

+ 9.9% yoy355

391

%Portion 3% 3%

Siam City Cement & TH subsidiaries

+ 15.4% yoy

*Not consolidated with shareholding of 40%

70:30

8,3267,216

%Portion 66% 70%

1,081 + 23.3% yoy


Revenues and margins by business segment

06/06/2019

Cement65%

Concrete & AGG

14%

Trading14%

Others7%

Q1/2018: Rev 10,904 MB, GPM 32%

Cement60%

Concrete& AGG14%

Trading19%

Others7%

Q1/2019: Rev 11,879 MB, GPM 33%

3,066

35285 284

2,950

442 412 292

Cement Concrete & AGG Trading Others

Q1/2018

Q1/201932.8%

30.8%% GPM

18.0% 19.5% 27.7% 25.3%13.2%GPM*

(MB)

*Not consolidated figures


EBITDA generation

2318

Siam City Cement Bangladesh

- 23.8% yoy

168

335

Chip Mong INSEE Cement*

%Portion 1.1% 0.8%

Siam City Cement Lanka

- 65.4% yoy16557

%Portion 8% 3%

Siam City Cement & TH subsidiaries

%Portion 75% 88%

+ 27.8% yoy

1,585

2,024

Q1/2018

Q1/2019

THB millionSiam City Cement Vietnam

- 39.5% yoy353

214

%Portion 17% 9%

Group SCCC Q1 2019

Thailand

Oversea

2,1262,313

+ 27.8% yoy

-46.7% yoy

+ 8.8% yoy

19.5% 19.5%%EBITDA

190104

2,3162,417

One-time Charge

Recurring EBITDA

288

2,024

541

1,585

75:25 88:12%TH:Oversea

*Not consolidated with shareholding of 40%

+ 98.7% yoy


Consolidated net profit trends

THB million

550

246

617

405

833

1,021

887

281

1,105

254

338

267

308

210

50

63

83

26

5.2%2.3%

5.6%3.6%

7.6% 9.2% 7.6%2.5%

9.3%

-70.0%

-60.0%

-50.0%

-40.0%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

-100

100

300

500

700

900

1100

1300

1500

Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18 Q1/19

1,131

804

584

884

713

1,0431,071

06/06/2019

Quarterly trend

950

364


Consolidated balance sheet

06/06/2019

Q1/2019 Balance Sheet

THB million

Leverage Ratio

• Gearing ratio decreased driven by lower net financial debt.

Assets77,204

Cash and Cash Equivalents

4,076

TOTALASSETS

Other Liabilities15,760

Total Financial

Debt*31,509

Total Shareholders'Equity

* Net of amortized cost

NFD: 29,751 NFD: 27,433

Eq: 34,387 Eq: 34,011

0.87x 0.81x

0.00x

1.00x

2.00x

3.00x

4.00x

5.00x

0

20,000

40,000

60,000

Q1/2018 Q1/2019

Times (x)THB million

Net Financial Debt Total Equity

Net Financial Debt/Total Equity Net Financial Debt/EBITDA

14.00x

Total Shareholders'

Equity34,011

11.86x


Financial debt and maturity profile Q1/2019

Group Consolidated (THB equivalent)

THB Currency, MTHB 26,810,

85%

VND Currency, MTHB 1,697, 5%

USD Currency, MTHB 1,118,

4%

LKR Currency, MTHB 1,848, 6% IDR Currency,

MTHB 98, 0%

• 85% of group debt are in THB held by Thai corporates.

• 84% of the group debt are at fixed interest rates.

• Long-term debt secured at an average interest rate of 3.5% for a 8 year average tenure

Million THB

Total: 31,571 MB

4,995

3,425

115

7,036

0

4,500

0

2,000

5,000

0

4,500

2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

Debt Maturity Profile (Group)

S/T Loan

L/T Loan


15.81

20.8522.13

19.91

17.02

6.59

10.14

13.00

15.00 15.00 15.00 15.00

10.00

8.00

82%

72%68%

75%

88%

152%

79%

0%

20%

40%

60%

80%

100%

120%

140%

160%

0

5

10

15

20

25

2012 2013 2014 2015 2016 2017 2018

EPS DPS Payout Ratio Payout Policy

Dividend Policy and Distribution Track Record

EP

S &

D

PS

(T

HB

) Div

ide

nd

Pa

yo

ut

Dividend Yield* 3.81% 3.55% 3.69% 4.70% 5.51% 4.40% 4.88%

Source: SET

Dividend payout policy at 60%

• Total DPS at THB 8 per share for performance year 2018 that well above the 60%

payout policy.


Agenda

Company



Outlook and Growth


2019 Business Challenges and Opportunities

Opportunities

o Recovery of TH

construction

o International supply of

clinker & cement

o Synergy across

business units

o Culture of Excellence

Challenges

o Excess capacity in

the region

o Energy cost

management

o Machine reliability

improvement

o Geopolitical

uncertainty


Construction Market HighlightWe expect infrastructure will significantly grow until Y2021 and will decline afterward as some

government projects will be completed. However, residential is expected to subsequently recover.

06/06/2019

Infrastructure

Industrial

Commercial

Residential

11.3

40%

26%

19%

Y2017AY2016A

29%

20%

Y2021F

32%

24%

11.8

22%

Y2022F

9.4

20% 21%

21%

40%

17%

24%

31%32%

Y2020F

19%

23%

28%

Y2019F

15%

Y2018E

21%

19%

28%

32%

10.3

33%

17%

21%26%

9.6 9.7

10.9+2% +2%+5%

+6%+4%

+4%

Residential IndustrialInfrastructure Commercial Unit (mio ton)

Positive trend of government spending lead to the

growth trend of girder and viaduct

Key Highlight

New opportunity from EEC

Demand doesn’t come back yet but still has positive

trend of CPM as Precast wall panel is replacing brick

No significant of signal of market coming back need to

wait until economic fully recover

Source : BIM Report, KBANK Research, SCBEIC, News Consolidation


SCCC Group has moved toward Integrated Construction Solution, with technology and new acquisition to expand capacity and capabilities

06/06/2019

Mortar - Value-added products and services

ISUB – Wall-Panel SolutionSCCO – Floor Solution

• Wall-Panel Solution – Offering “Total wall solution package”

including wall design, customized panels, and wall-panel

specific applicators to customers in residential, commercial,

and industrial segments

• Adhesive Mortar – Expanding complete portfolio for tile

products

• Engineering Mortar – Offering engineering mortar to

industrial and infrastructure segments

• Decorative Mortar – Offering white-cement related products

• Bulk Services and Solution – Offering solutions to boost

Mortar bulk demand in high-rise project channel

• INSEE Floor Solutions – Offering total solution as single

point of contact for specific-use flat floor such as high

standard of industrial floor

SCCO – Mobile Concrete plant

• Fully mobile machine to faster set up and support new

customers and demand, especially in BKK and ESB

• Better coordination at site

• Quality is consistent

• First Mobile Fleet unit is expected to commercialize in

Q2’19.

Project Reference

- Kabinburi Glass

Industry (KBI)

- Prospect Warehouse

- Continental Tire

Project

- Prospect Warehouse


INSEE AggregatesWe expect high demand growth in H2 2019. Aggregates quality becomes more focus as CPM industry is growing.

AGG business expansion to Chonburi and Saraburi quarries.

INSEE Ratchaburi

INSEE AyudhyaINSEE Angthong

INSEE Suphanburi

INSEE Saraburi

INSEE Chonburi

Existing Operation

New Operation

AGG in relevant market

• New crushing plants in Suphanburi are running to produce

the high performance (premium quality) aggregates

• Plant is designed to control environmental impacts i.e.

dust with a closing system for conveyors, crushers, noise

and vibration

• Further penetrate into CPM players with cooperation with

bulk cement sales


INSEE ECOCYCLE: Apart from continue our growth as a waste management solution provider,

our Industrial Cleaning Services has been strengthened with the acquisition of P.G. Service, enabling us to

cover both chemical cleaning to mechanical cleaning.

➢ Chevron/STP&I Platform

Decommissioning Project

➢ PTTEP Disposal of Rubber

Hoses, Sealine Pipes

➢ Petronas RAPID Project -

Malaysia

➢ Chandra Asri Project -

Indonesia

Innovation with Robotic Tank

Cleaning technology with ATEX

Zone 0 Certified for safety reason

with no man entry and much faster

implementation


CONWOOD THAILAND Expand to decorative product and solution with trade channel

enhancement to capture B2C segment and growing export market

06/06/2019

2019

• Solution to B2B project: collaborated with project sales team to approach new market segment such as

Sales gallery and B2B project for proposing solution service and total B2B service revenue of Year 2018 is

1.2 mB and just completed product installation of Prodigy condominium on December

• Solution to B2C Renovate segment :

• Direct approach villa property management to propose Conwood service for villa renovation due to

each villa need renovation for their public area and club house

• Continuing arrange Solution Road show activities at Modern trade stores especially HomePro for

directing to homeowner

• Collaborate with IMC to arrange customer activities and Conwood service promotion at Conwood

showroom for creating brand awareness and sale revenue


World Class Wood Replacement Producer

PT CONWOOD Indonesia


Our Pride - Awards & Recognitions

06/06/2019


Our Pride

Organization Excellence Awards

06/06/2019

The Thailand’s Top Corporate Brand Values 2018in Construction Material Sector - 2nd consecutive yearAwarded by the Faculty of Commerce and Accountancy Chulalongkorn University and in collaboration with The Stock Exchange of Thailand

Thailand ICT Excellent Awards 2018 (5 Awards)Excellence Awards - INSEE Digital Connected Plant Project and INSEE SMART Pay ProjectDistinguished Awards - INSEE People Planning Development Analytics Project, Capex Management Project, and Smart Delivery ProjectAwarded by the Thailand Management Association (TMA)

Asia’s Training & Development Excellence Awards - Best Leadership Development Program for Middle ManagementAwarded by World HRD Congress

Best Industrial Waste Management AwardGold Plus Level - Non-hazardous Solid BlendingGold Level - Liquid Blending, Alternative Resource in cement production, Spay cans recycle, and Light bulbs recycleAwarded to INSEE Ecocycle (Saraburi Platform and Chonburi Platform) and SCCC (Plant 1 & 3), by the Department of Industrial Works, Ministry of Industry


Our Pride

Organization Excellence Awards

06/06/2019

World Coaching Congress & Awards - Operational Performance Improvement (OPI) Coach Capability DevelopmentAwarded by World HRD Congress, February 2019

The ATD Excellence in Practice Awards - Operational Performance Improvement (OPI) Coach Capability DevelopmentAwarded by ATD, USA, May 2019


Our Pride

Sustainable Development Awards

06/06/2019

“Excellent” recognition level of Corporate Governance Performance of Thai Listed Companies - 3rd consecutive yearAwarded by Thai Institute of Directors Association (IOD)

Green Industry Award Level 5 - Green Network (Renewal)Awarded by Department of Industrial Works, Ministry of Industry

Green Mining Awards - Mine category (6th consecutive year) and Crushing plant categoryAwarded to SCCC and SCCO (INSEE Suphanburi), by the Department of Primary Industries and Mines, Ministry of Industry

CSR-DIW Continuous Awards (Corporate Social Responsibility) Awarded to SCCC, INSEE Ecocycle and Siam City Power , by the Department of Industrial Work , Ministry of Industry

Thailand Green and Smart Mining Awards 2019Awarded to SCCC by the Ministry of Natural Resources and Environment

32Siam City Cement Public Company Limited ©SCCC | All Rights Reserved. 06/06/2019

Q&A

Date post:	31-Dec-2020
Category:	Documents
Upload:	others
View:	3 times
Download:	0 times

Siam City Cement PLC. Q1 2019 Performance · 2019. 6. 6. · Cement Grinding Station MMC Terminal &...

Documents