SCGD responds to the ASEAN market’s gradual recovery. Its first quarter 2024 results show 6.7 billion baht in revenue and 44% increased profits.

Mr. Numpol Malichai, Chief Executive Officer and President of SCG Decor Public Company Limited or SCGD, revealed the operating results for the first quarter of 2024 SCGD that although the company will have a sales revenue of 6,784 million baht, a decrease of 6 percent compared to the same period last year. It remained stable compared to the previous quarter, but the company had a profit of 258 million baht, an increase of 44 percent compared to the previous quarter. And increased by 28 percent compared to the same period last year. (Excluding the impact from restructuring and other non-recurring items in the prior year) from the fact that the company could maintain product prices for ceramic tiles and sanitary ware close to the previous quarter. By being able to sell an increased proportion of high-margin products. Including various cost reduction and production efficiency improvement projects that the company has implemented and continuously decreasing energy costs.

Therefore, in the first quarter of the past, SCGD received approval to invest another 290 million baht in 3 projects, which are projects to reduce costs and increase production efficiency, namely the solar cell installation investment project of 5.5 megawatts, investment of 140 million baht. To increase the proportion of renewable energy use and reduce energy costs. It is expected to be completed around the beginning of 2025. Project to improve warehouse management efficiency, an investment of 70 million baht by installing a warehouse management system and automatic forklift, and a large tile production line project in Nong Khae, an investment of 80 million baht, expected. Production will start by the end of 2024.

In addition, there are investment projects to reduce energy costs that have already been invested. And is expected to be completed by the middle of this year, including a project to install a Hot Air Generator to reduce energy costs at two more factories in Thailand, which is expected to be completed in May, and a project to improve the SPC vinyl tile production line, which will begin. It has produced SPC vinyl tiles for the Thai market since the end of the second quarter, with a production capacity of 1.8 million square meters per year. Importantly, SCGD also has an investment project in Vietnam that will be gradually completed and ready to begin operations as planned within the year. 2024 includes group product production projects “Porcelain tiles” and large tiles, another 2.2 million square meters per year in the central region of Vietnam, and a project to produce 9.1 million square meters of porcelain tiles yearly. In northern Vietnam, production is expected to start at the end of 2024, with all investment projects being investments to increase efficiency. Reduce production costs according to ESG guidelines, including improving various production technologies. Produce products that meet the needs of consumers. And prepare the business for growth following the market recovery in the future.

Chief Executive Officer and President of SCGD said that the surface decorative materials market Ceramic tiles and sanitary ware in Thailand in the past quarter was as expected. More than 60% of the leading sales come from Thailand's surface decoration and sanitary ware business. Meanwhile, overall overseas sales are still waiting to recover.

For the second quarter, Thailand is expected to have positive factors. The passing of the annual budget will result in more money circulating in the system, which, together with important economic stimulus measures from the government, will build confidence and make consumers more confident in spending.

Situation of the surface decorative materials market Ceramic tiles and sanitary ware in the ASEAN region In Vietnam, progress has been made in the new land law to reform the administrative process related to land and create a national land database. Although it will come into effect in early 2025, it is expected to be a driving force that helps create an atmosphere and stimulate the real estate industry in Vietnam to be more active starting this year. The Philippines and Indonesia are expected to recover from improved economic situations.

SCGD is confident that the ASEAN market will recover according to the projected target of 4-5%. Therefore, it has set a target of doubling its overall income or approximately 60 billion baht by 2030 with four strategies:

1. Create growth for the floor and wall tile surface decoration business. Through various necessary action plans, including expanding investment in factories in the southern region of Vietnam. Increase sales of high-value-added products (HVA), increase efficiency in product management, create a joint product procurement base (business sourcing), and expand the distribution channel network. And increase sales of products with high growth rates, such as SPC vinyl covering materials and porcelain glaze tiles.

2. Expand the sanitary ware business in ASEAN By expanding the distribution channels of the surface decoration business. And expand investment in new sanitary ware factories in ASEAN. The goal is to grow sanitary ware sales by twice or more than 10 billion baht. In the past quarter, SCGD has accelerated the implementation of the strategy to expand the sanitary ware business in ASEAN, another main SCGD business with a revenue proportion of approximately 20%, by accelerating the expansion. Distribution channels: Add distributors of sanitary ware abroad to expand the distribution channels of the surface decoration business. In Vietnam, from 17 to 39, the Philippines, from 78 to 85, and Indonesia, from 28 to 37, the company currently has a network of 161 sanitary ware distributors in those three countries.

3. Expand business into related products and services. To emphasize being a leader in providing integrated services and increasing opportunities to sell related products such as glue and sealant, doors, windows, and kitchen furniture sets, among others, by taking advantage of a strong distribution channel network.

4. M&P (Merger & Partnership) invests in merging businesses and building partnerships with existing owners in the surface decoration and sanitary ware companies. And related product and service businesses both in and abroad.