MOSCOW (MRC) -- Thai producer SCG Packaging’s (SCGP) third-quarter earnings slumped from the previous quarter due to various forms of lockdowns re-imposed in major southeast Asian countries following spikes in COVID-19 cases, said the company.
On a year-on-year basis, however, earnings in July to September posted strong gains on the back of mergers & partnerships (M&P) and organic expansion, which are expected to continue into next year.
"Looking forward into the rest of 2021 and through to early 2022, major ASEAN economies are heading toward the recovery from the easing of strict lockdown measures,” SCGP said in the notes accompanying its financial results.
"Nonetheless, the pace of recovery will likely to be gradual especially in term of consumers’ expenditure and confidence while there is ongoing normalization of supply chain efficiency for overall manufacturing sectors,” it said.
SCGP was spun off from Siam Cement Group, and raised USD1.5bn via an initial public offering (IPO) in October 2020 to fund its acquisitions. The latest in its recent string of acquisitions and expansions is a Thai baht (Bt) 11.8bn (USD355m) investment on a new 370,000 tonne/year packaging paper plant in Vietnam.
The plant in north Vietnam is slated for commercial operations in early 2024, enabling the company to tap opportunities in the region, as well as in south China, the company said. SCGP deems Vietnam as a high growth market with an estimated compounded annual growth rate of 6-7% in 2021-2025.
In the third quarter, however, Vietnam has had to impose a more stringent lockdown compared with its ASEAN peers following spikes in COVID-19 cases in the country. Supply chain disruptions particularly in the southern region resulted in low run rates of 30-50% among domestic manufacturers, SCGP said.
As MRC informed earlier, Dow and SCG signed a collaboration agreement to develop new complete recycling solutions to add value to plastic waste and prevent them from ending up in the environment. This agreement is an attempt to create a circular economy for plastic in Thailand.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,396,960 tonnes in January-July 2021, up by 7% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 841,990 tonnes in the first seven months of 2021, up by 29% year on year. Supply of propylene homopolymers (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of statistical copolymers of propylene (PP random copolymers) subsided.
SCGP is a unit of Thai conglomerate Siam Cement.
MRC