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2011: Sector Leader of Building Materials & Fixtures 2011-2008: Ranked Gold Class 2004: member since Ranking by SAM Bank of America Merrill Lynch CalGEMs Conference Ritz-Carlton Laguna Niguel June 12 – 13, 2012
Transcript of 2011: Sector Leader of Building Materials & Fixtures 2011 ...scc.listedcompany.com/misc/PRESN/SCG...
2011: Sector Leader of Building Materials & Fixtur es2011-2008: Ranked Gold Class2004: member since
Ranking by SAM
Bank of America Merrill LynchCalGEMs Conference
Ritz-Carlton Laguna NiguelJune 12 – 13, 2012
Slide 2Agenda
� Strategy
� Sustainability
� Business Updates
� Financials
� Appendix
Slide 3Business segments today
Q1/1192,478 MB
Q1/12102,884 MB(+11% y-o-y)
Revenue from Sales
Q1/119,207 MB
Q1/125,972 MB
(-35% y-o-y)
SCG Investment1) dividend income (stake of <20%)
2) equity income (stake of 20% - 50%)
Recurring Profit for the Period ChemicalsSubsidiaries
12%
Chemicals Equity Income
7%
Slide 4Strategy
GROWTH
1) Expansion in ASEAN
2) High Value Added products & services (HVA)
DISCIPLINED
“Cash return on investment” hurdle of 15%
“Dividend payout” policy of 40-50%
Slide 5CAPEX cyclesInvestments, and M&A
Past Phase2006 - 2010
Current Phase2011 - 2015
...ASEAN expansion of core businesses
� CAPEX of +150,000 MB
� Cash-flow financed
� Cash on hand of 44,827 MB
� Mostly M&A
� Mostly ASEAN� CAPEX of 146,026 MB ($4.7Bill)
� Cash-flow financed
� Mostly green field
� Mostly Thailand
Slide 6ASEAN assets
Note: as of Apr/12
ASEAN
ASEAN assets = 52,900 MB($1.8 Billion or 14% of total assets )
Slide 7ASEAN segmentsASEAN is an increasing part of SCG.
ASEAN
Note: as of May/12
ASEAN as a % of SCG consolidated
2006 2007 2008 2009 2010 2011 Q1/12
Sales from ASEAN Operations
% 3% 5% 5% 7% 7% 7% 6%
MB 7,700 13,400 14,600 16,700 20,200 23,700 6,367
Assets % 3% 5% 5% 7% 7% 13% 14%
MB 6,800 13,000 14,500 22,500 26,700 47,000 52,900
HR* % 5% 10% 11% 11% 12% 19% 27%
Staffs 1,180 2,628 2,974 3,225 3,777 6,519 10,157
* Including SCG's international staff (Thai)
Slide 8SCG’s capacity ranking
Thailand ASEAN
Downstream Chemicals 1 17.2 million tons
Packaging Paper 1 11.9 million tons
Cement 1 224 million tons
Building Products 1 1149 million sqm of ceramics
ASEAN
Note: as of May/12
Slide 9
5%
ASEAN38%
Export destinations in Q1/12ASEAN accounted for 38% of all exports.
ASEAN
Slide 10Regional growth opportunitiesLow Consumption per Capita in ASEAN
ASEAN
Note: figures for 2011
Slide 11
Lightweight Concrete Block May/12� Greenfield plant of 6 mill sqm, with start-up in early 2014 1,250 MB
Boral Indonesia Feb/12� Leading ready-mixed concrete (RMC) with 2.2 mill cubic metre. 4,300 MB� Businesses includes concrete pipes, precast concrete, quarries,
and limestone reserves for expansion.
ASEAN investments since Jan/11
ASEANIndonesia
Chandra Asri Petrochemicals� 30% stake, with expected conclusion of project upgrades, such as
cracker debottleneck, downstream expansions, and cost efficiency initiatives.
KOKOH: distribution � 22 distribution centre� +10,000 wholesalers / retailers.
KIA: ceramic tiles� Domestic market share of 10%� Capacity of 27 mill sqm.
Jun/113,100 MB
Sep/1113,500 MB
Slide 12
Philippines: Ceramics Mar/12� Mariwasa is a leading ceramics player in the Philippines, 150 MB
with 12 mill sqm.� Increased stake to 83% (from 46%).
Vietnam: PVC pipe producers Mar/12� Acquired 17% stake in Binh Minh Plastics (south Vietnam) 1,200 MB� Acquired 23% stake in Tien Phong Plastics (north Vietnam)� Combined PVC pipe capacity of 150,000 tons.
Vietnam: White cement grinding plant Jan/12� Buu Long (0.2 MT) is Vietnam’s primary producer of 200 MB
white cement.
Vietnam: Box plant Jan/11� Alcamax (53,000 tons) has a leading domestic market share 750 MB
with large multinational clients.
ASEAN investments since Jan/11
ASEANPhilippines & Vietnam
Slide 13
Box plant Mar/12� Acquisition of Tawana Container (61,000 tons) 410 MB� Resulting in SCG’s capacity of 855,000 tons (46% internal integration).
LLDPE cast film Mar/12� 45% JV with Mitsui Chemicals Tohcello 1,400 MB� 15,000 tons of T.U.X. LLDPE cast film, a HVA product.
PVC producer Mar/12� Increased stake to 90% (from 46%) in Thai Plastic and Chemicals, 11,500 MB
a regional integrated PVC producer.
Modular home producer May/11� Capacity increased to 1,000 homes, from 200. 2,900 MB� SCG Heim is a JV with Sekisui Heim of Japan
ASEAN investments since Jan/11
ASEANThailand
Slide 14Cement expansion
Under Study Capacity Asset
� Indonesia 1.5 – 3.0 MT integrated cement (Green field)
� Myanmar 1.5 – 3.0 MT integrated cement (Green field)
ASEAN
Existing Capacity Since Asset
� Vietnam 0.2 MT 2012 white cement grinder (M&A)
� Cambodia 1 MT 2008 integrated cement (Green field)
� Thailand 23 MT 1913 integrated cement (Green field)
Slide 15Chemicals expansion
� JV Agreement (Feb 9/12) with partners:
� QPI Vietnam (subsidiary of Qatar Petroleum Int’l)
� PetroVietnam, and Vinachem
� Thai Plastic and Chemicals (SCG stake of 90%)
ASEAN
Vietnam Complex:
Future Location Start-up Stake Olefins CapacitySCG 28%(TPC 18%)
(Flex-feed cracker)
Ethylene Propylene Total1) ROC Complex Thailand 1999 SCG 64% 800 400 1,200
2) MOC Complex Thailand 2010 SCG 67% 900 800 1,700
3) Chandra Asri Indonesia 1995 SCG 30% 600 320 920
Existing Total 3,820
Existing Location Start-up StakeOlefins Capacity (ton)
Vietnam Complex Vietnam 2017-2018 1,400
Slide 16HVA = High Value Added Products & ServicesHVA on Sales target of 50% by 2015, from subsidiaries.
HVA
Note: as of Apr/12
Slide 17Systematic training roadmapCompetent staffs are key...
.
Slide 18SCG’s external training programs
Programs Current Since Years Staffs
Harvard 1982 31 65
Wharton 2007 6 11
EDP - Executive Development Program Columbia 2007 6 172
Wharton 1981 32 1,307
Duke 2011 2 111
Marketing Excellence Program Kellogg 2006 7 406
MDP - Management Development Program
AMP - Advanced Management Program
Note: as of Apr/12
Slide 19Corporate scholarship program Began in 1973, with 406 scholarships granted. .
Note: Note: Note: Note: 301 scholarships are active, others have mostly retired
Current 50 students (42 overseas): MBA 15, Engineering 32, Specialist 3
Slide 20Agenda
� Strategy
� Sustainability
� Business Updates
� Financials
� Appendix
Slide 21
� DJSI was established in 1999 as the first truly glo bal index to monitor sustainability initiatives of listed companies.
� +60 global funds in 16 countries follow the DJSI..
� For further details: www.sustainability-index.com
� : Global Sector Leader (Building Materials & Fixtures) by SAM
� : ranked “Gold Class” which is top group for each s ector.
� : initial year of DJSI membership.
2011
2011-2008
2004
Slide 22DJSI sector overview Building Materials & Fixtures
SUSTAINABILITY LEADERSAs of September 8, 2011
Universe Member Universe Member Universe Member Universe M ember
Number of Companies 45 8 10 3 5 1 10 3
ASAHI GLASS CO LTD Japan
BORAL LTD Australia
CRH PLC Ireland
HOLCIM LTD Switzerland
LAFARGE SA France
OWENS CORNINGUnited States of America
SCG Thailand
TOTO LTD Japan
WEYERHAEUSER COUnited States of America
CompanyDJSI World DJSI Europe DJSI North America DJSI Asia/Pa cificIndustry
LeaderCountry
Slide 23Agenda
� Strategy
� Sustainability
� Business Updates
� Financials
� Appendix
Slide 24
+50% of PE/PP are exported to +110 countries
SCG ChemicalsIntegrated and competitive operations.
Cracker #1 (1999)1.2 MT C2 & C3
Crackers
SubsidiariesPEPP
PVCOthers
AssociatesDow
MitsuiMitsubishi Rayon
Others
Regional PlayerThailand - Fully Integrated
Chemicals
Cracker #2 (2010)1.7 MT C2 & C3
Downstream
Slide 25
Typical crackersGas-based Naphtha-based
0
300
600
900
1200
'000 tons
‘000 tons
SCG Chemicals Investment in the propylene-rich cracker
Chemicals
0
300
600
900
1200
'000 tons
ethylenepropylene
‘000 tons
SCG’s 1 st
cracker(1999)1.2 MT
Propylene-rich crackerNaphtha-based
SCG’s 2nd
cracker(2010)1.7 MT
0
300
600
900
1200
'000 tons
‘000 tons
by-products
ethylene
propyleneby-products
ethylene
Slide 26Historical margin: HDPE – NaphthaTrough is supported by the $400/ton global conversion cash cost
0
100
200
300
400
500
600
700
800
900
1,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Price Gap
Avg global conversioncash cost of $300/ton ,
ex-feedstock
Avg global conversioncash cost of $400/ton
ex-feedstock
$/ton
Chemicals
Slide 27Global ethylene incremental supply growth
0
2
4
6
8
10
12
2009 2010 2011 2012 2013 2014 2015
MT
10.5
Incremental supply growth
3% 8% 5% 2% 3% 3% 3%
6.9
3.4
Ramp-up Capacity
Effective Nameplate Capacity
Chemicals
~2.5
~5.0 ~5.0 ~5.0
Note: as of Jun/12, estimated by ground breaking ba sis
Slide 28
HDPE
EthyleneNaphtha
$/ton
HD-Naphtha 456 396 443 441 375 465Spread ($/T) 434
Q2/12to date
0
250
500
750
1,000
1,250
1,500
1,750
Q1/11 Q2/11 Q3/11 Q4/11 Q1/12
Chemicals
HDPE – Naphtha Price GapPE margins are at trough levels
Note: SEA regional pricesConversion rate: 1 PE = 1 Ethylene
Slide 29
0
250
500
750
1,000
1,250
1,500
1,750
2,000
PP-Naphtha 717 691 650 535 408 515Spread ($/ton) 649
PP
Propylene
Naphtha
Q2/12to date
Q1/11
$/ton
Q2/11 Q3/11 Q4/11 Q1/12
Chemicals
PP – Naphtha Price GapPP margins carries a premium over PE margins.
Note: SEA regional pricesConversion rate: 1 PP = 1 Propylene
Slide 30
0
250
500
750
1,000
1,250
1,500
1,750
PVC
EDC
Ethylene
VCM
PVC-EDC/C2 323 437 444 406 424 489
Spread ($/ton) 403
Q2/12to date
$/ton
Q1/11 Q2/11 Q3/11 Q4/11 Q1/12
Chemicals
PVCContinued healthy margins.
Note: FE regional pricesConversion rate: 1 PVC = 1 VCM = 0.8 EDC + 0.2 Ethy lene
Slide 31
BenzeneToluene
Naphtha
BZ-Naphtha 224 137 148 84 155 203TL-Naphtha 111 116 208 239 214 234BZ Spread ($/ton) 148TL Spread ($/ton) 169
0
200
400
600
800
1,000
1,200
1,400
1,600$/ton
Q2/12to dateQ1/11 Q2/11 Q3/11 Q4/11 Q1/12
Chemicals
Benzene & TolueneMargins recovery in Q1/12.
Note: SEA regional prices
Slide 32
Chemicals
Price Gaps of AssociatesMMA-Naphtha: Continued weak demand of electronic industry.BD-Naphtha: Surged from picked up BD price in U S.PTA-PX: Still slow demand in textile mar ket..
Slide 33SCG CementSCG is the only producer with nationwide production facilities, and the leading domestic market share of 40%. Cement
SCG’s ASEAN capacity23 MT Thailand
1 MT Cambodia0.2 MT Vietnam
NorthSCG 2 MT
CentralSCG 14 MTOther players 16 MT
SouthSCG 7 MT
Slide 34
0
5
10
15
20
25
30
35
40
45
50
55
60
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Million Ton
Industry Production 39.5 MT
Industry Capacity 56MT
Total Domestic Demand 28 MT
Total Thai Export 11.5 MT
Total Domestic Growth Rate (% y-o-y)- 10% -45% 15% -8% -1% 23% 6% 11% 9% -2% -6% -6% 1% 10% 3% >5%
Domestic cement industryForecasted domestic demand growth of >5% for 2012.
+75% Op Rate
Cement
2011 2012
Slide 35Domestic cement pricesEx-factory price was $60/ton in Q1/12, with domestic demand growth of 6% y-o-y. CementCement
Avg Domestic Price of Grey Cement (Net ex-factory)
-
500
1,000
1,500
2,000
2,500
Baht/Ton
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
2008 2009 2010 2011 2012
Sales Mix in Q1/2012Bagged Mixed Cement 32%Masonry Cement 5%Bulk Portland 51%Bagged Portland 12%
Slide 36Cement exportsExport prices are at FOB basis.
4.7
6.07.1 7.6
6.2 6.16.8 7.0
8.1 8.27.6 7.3
6.4
1.9
2224
22 2124
27
34 35 34
40 3841
45
49
0.0
10.0
20.0
30.0
40.0
50.0
0.0
5.0
10.0
15.0
20.0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Q1/12
Million Ton $/ton
Export Volume (MT)
Export Prices (FOB)
Cement
Slide 37SCG CementWaste-heat power generators
Phase 1 2,000 MB Thailand -started in Q1/08
Phase 2 350 MB Cambodia -started in Q2/09
Phase 3 3,400 MB Thailand -started in Q4/09
total 5,750 MB
� Utilize heat from the production process to generate electricity.
Cement
Slide 38SCG PaperOperations within ASEAN
P&WShort-fiber pulp: 425,000 tonsP&W paper: 565,000 tons
PackagingPackaging paper: 1,880,000 tonsBox plants: 855,000 tons
Box plant
Packaging plant
Pulp mill
P&W plant
Paper
Slide 39
Packaging
P&W
Internal Sales-Corrugated Box
100%integration
46%integration
54%External Sales-Containerboard-Paperboard
Internal Eucalyptus Pulp P&W Paper
SCG PaperIntegrated operations
Paper
Slide 40P&W paper
Paper
Note: regional prices
Slide 41Packaging paper
Paper
Note: regional prices
Slide 42Business outlook
Chemicals� PE/PP margins remain under pressure from soft global demand.� PVC demand remains strong in ASEAN.� MMA and PTA demands are expected to recover from improved derivative
demands.
Cement� Domestic demand growth of >5% in Q2/12.� Demand growth in the residential and commercial sectors, while demand from
the government sector will benefit from budget allocations. � Domestic prices are expected to remain under pressure from competition.
Paper� Demand growth is low for P&W, while packaging demand tracks exports growth.� Flood recovery of box plants in Q2/12.
Slide 43Agenda
� Strategy
� Sustainability
� Business Updates
� Financials
� Appendix
Slide 44
28,58433,704
50,359 46,936 49,38043,246
34,20644,046 41,943 40,838
9,835
1,8343,484
4,267 6,5717,771
6,762
4,577
3,070 4,006 5,415
0
10,000
20,000
30,000
40,000
50,000
60,000
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Q1/12
MB
Note: EBITDA includes dividend received
- Dividend from associated companies- EBITDA from Operations
EBITDA
30,418
37,188
54,626 53,50757,151
50,008
38,783
47,116 45,949($1.5 Bn)
46,253
46610,301
-24% y-o-y+29% q-o-q
Slide 45Profit for the period
11,14217,806
33,70730,713
25,841
16,479
27,281
5,972
3,462
2,148
2,776
1,5234,511
292
9,963
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Q1/12
MB
14,604
19,954
36,483
32,236
EPS 12.2 16.6 30.4 26.9 24.5 25.3 14.0 20.3 31.2 22.7 5.0(Bt/sh)
29,451 30,352
16,77127,419
24,346
- Divestment gain
37,382
27,281
-35% y-o-y+87% q-o-q
5,972
Slide 46Equity IncomeQ1/12 was affected by the Q4/11 flood and chemicals trough
2,537 2,785
4,2143,123
1,880 2,2631,706 1,966 2,049
1,289
-131
3,1403,962
5,5946,811
7,216 5,980
2,963
5,2346,341
5,485
344
-500
500
1,500
2,500
3,500
4,500
5,500
6,500
7,500
8,500
9,500
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Q1/12
MB
5,677
6,747
9,808 9,934
9,096
8,243
4,669
6,7747,200
8,390
+184% q-o-q
213
- Chemicals- Non-Chemicals
Slide 47Net debtIncludes cash of 44,827 MB ($1.5 Billion)
246.7
189.5179.9 175.8
148.4
126.3114.9
100.6 100.5 103.1 99.9120.5 122.0
83.6
112.1125.6
0.0
50.0
100.0
150.0
200.0
250.0
300.0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Q1/12
Billion Baht Debt Profile
• Net Debt / EBITDA = 3.0x• Net Debt / Equity = 0.8x• 91% are Thai Baht• 76% are fixed • Interest cost of 4.3%
CAPEX = 146 Bn Baht
CAPEX = 198 Bn Baht
Net Debt 9.2 7.7 6.4 5.8 5.1 4.1 3.1 1.8 1.9 1.8 2.0 3.1 2.6 1.8 2.4 3.0on EBITDA
Slide 48
61.3
10.0
3.5
10.3 8.55.7
11.9 14.0
19.123.6
27.2
42.4
34.5
18.4
32.0
20.0
0
10
20
30
40
50
60
70
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Q1/12
- CAPEX includes debottlenecking, expansion projects, and major turnaround.- Investments are acquisitions and purchase of shares .
CAPEX & investments
2006-2010 = 146 Bn Baht 2011-Q1/12
= 52 Bn Baht
Billion Baht
Past PhaseCurrent Phase
Slide 49Incremental capacity:Previous investment phase (2006 – 2010)
(Capacity at year end = '000 tons)
2007 2008 2009 2010 2011 SCG Stake CAPEX (MB)
Chemicals Upstream (Cracker) Cap Times
Ethylene (subsidary) 800 800 800 1,700 1,700 900 2.1 x 45,600 MB
Propylene (subsidary) 400 400 400 1,200 1,200 800 3.0 x ($1.2 Bill)
Chemicals Downstream HDPE (subsidiary) 780 780 780 1,180 1,180 400 1.5 x 17,100 MB
PP (subsidiary) 320 320 320 720 720 400 2.3 x ($450 mill)
PVC (90% stake in TPC) 858 828 766 886 886 28 1.2 x 45% 2,200 MB
LLDPE (Dow JV) 300 300 300 650 650 350 2.2 x 50% 2,100 MB
Specialty Elastomers (Dow JV) - - - - 220 220 - 50% 3,000 MB
Propylene Oxide (Dow JV) - - - - 390 390 - 50% 2,400 MB
MMA (Mitsubishi Rayon JV) 85 85 85 175 175 90 2.1 x
Cast Sheets (Mitsubishi Rayon JV) - - 20 20 20 20 -
Paper Printing & Writing Paper 365 565 565 565 565 200 1.5 x 100% 7,300 MB
Packaging Paper 1,660 1,660 1,880 1,880 1,880 220 1.1 x 70% 5,200 MB
Box 550 637 692 741 795 245 1.4 x 70% 3,200 MB
Cement Cambodia Grey Cement (MT) 23 24 24 24 24 1 1.04x 90% 3,000 MB
Building Products Ceramic Tiles (M sqm) 95 122 122 122 149 54 1.6 x 54% to 100% 6,800 MB
Ceiling & Wall product (M sqm) 34 50 57 57 65 31 1.9 x 100% 3,200 MB
Lightweight concrete (M sqm) 3 3 3 15 15 12 4.0 x 68% 1,600 MB
47% 2,500 MB
Total Cap
2007 - 2011
67%
100%
Increase Project Cost
HVA from Assc. Apr startOct start
Slide 50Uses of cash
(MB) 2006 2007 2008 2009 2010 2006 - 2010 2011 Q1/12 2011 - 2015
EBITDA 57,151 50,008 38,783 47,116 45,949 239,007 46,253 10,301
Profit for the Period 29,451 30,352 16,771 24,346 37,382 138,302 27,281 5,972
CAPEX & Investment 23,574 27,160 42,379 34,535 18,378 146,026 32,053 20,025
Dividend Paid 18,000 18,000 9,000 10,200 15,000 70,200 15,000 -
Tax 4,036 5,898 4,562 5,168 13,959 33,623 7,504 1,264
Finance Costs 5,169 5,273 6,089 5,649 4,670 26,850 6,048 1,242
Past Phase Current Phase
Slide 51
� Retail investors only.� Unsecured, unsubordinated. � No debt covenant.� Thai Baht, fixed rate, and
4 year maturity.� Current “A” rating by Fitch (local).
16,000
25,000 25,000
15,000
25,000
40,000
30,000
15,000
25,000 25,000
0
10,000
20,000
30,000
40,000
50,000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Debenture Maturity TableMB
NOTE: Debentures amount to 115,000 MB, as of Q1/12.
Debenture profile
Slide 52
0.00.00.00.0
1.01.01.01.0
3.03.03.03.0
6.06.06.06.0
15.015.015.015.0 15.015.015.015.0 15.015.015.015.0 15.015.015.015.0
7.57.57.57.5
8.58.58.58.5
12.512.512.512.5 12.512.512.512.5
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Baht / Share
% of Net Profit 0% 16% 25% 36% 49% 56% 61% 59% 54% 42% 40% 55%
Dividend Payout Summary
Slide 53Agenda
� Strategy
� Sustainability
� Business Updates
� Financials
� Appendix
Slide 54Background
� Founded in 1913.
� Listed in 1975 on the SET.
� Market cap of $13.2 Billion (340 Bt/sh)
� Free float of 70%.
� Approximately 38,000 staffs.
� Asset of 386.8 Billion Baht ($12.5 Billion)
� Key figures (FY2011):
� Net Sales 368.6 Billion Baht ($11.9 Billion)
� EBITDA 46.3 Billion Baht ($ 1.5 Billion)
� Net Profit 27.3 Billion Baht ($ 0.9 Billion)
Slide 55Organization chart
Board of Directors
Management Committee
CFO & Investment
SCG Cement
SCG Paper
SCG Chemicals
SCG Distribution
President & CEO
Audit Committee
Internal Audit Office
SCG Building Materials
Corporate Administration
SCG Investment
Governance and Nomination Committee
Remuneration Committee
Slide 56Shareholders
LocalCrown Property
Bureau 30%
Foreign + NVDR 36%
LocalRetail / Inst
34%
(NVDR 11%)
Local 64%– Institution / Retail 34%– Crown Property Bureau 30%
Foreign 36%– Foreign Board 25%– NVDR 11%
Mar 30, 2012
(Foreign Board 25%)
Slide 57Operational history
Crisisof
1997Organic growth
TakeoverNew
industries
1913 – 1970’s 1970’s - 1980’s 1980’s - 1990’s
“Historic roots” “Opportunistic” “Partner of choice”
� Cement� Construction Materials� Steel
� Ceramics� Paper & Packaging
� Chemicals � Automotive� Electrical
1998 - 2003
Restructure
2004 - onwards
ASEAN&
HVA
Today� Chemicals� Cement� Building Materials� Paper � Distribution� Investment
Slide 58Capacity at the end of 2012
Chemicals - Naphtha Cracker (consolidated) Chemicals - Associates (equity accounting) Ethylene 1,700,000 tons Dow Chemicals JV (50%) Propylene 1,200,000 tons - LLDPE 650,000 tonsChemicals - Downstream (consolidated) - Propylene Oxide 390,000 tons HDPE 1,180,000 tons - Specialty Elastomer 220,000 tons LDPE + LLDPE 200,000 tons - PS 120,000 tons PP 720,000 tons - SM 300,000 tons PVC (Thai, Indo, Viet) 886,000 tons - Synthetic Latex 18,000 tons
Mitsui Chemicals JV (20% - 50%)Cement (consolidated) - PTA (50%) 1,440,000 tons Grey Cement (Thai, Camb) 24 million tons - PET (20%) 100,000 tons Ready-Mixed Concrete 22 million metre3 - PP Compound (46%) 86,000 tons (Thai, camb, Myan, Indo, Laos, Viet) - LLDPE Cast Film (45%) 15,000 tons White Cement (Thai, Viet) 0.4 million tons Mitsubishi Rayon JV (47%)
- MMA 175,000 tonsBuilding Products (consolidated) - Cast Sheets 20,000 tons Ceramic Tiles (Thai, Indo, Phil) 149 M sqm Chandra Asri JV(30%) Roofing Tiles (Thai, Cam, Phil, Viet) 87 M sqm - Ethylene 600,000 tons Ceiling & Wall Products 65 M sqm - Propylene 320,000 tons Autoclaved Lightweight Concrete 15 M sqm - HDPE / LLDPE 320,000 tons
- PP 480,000 tonsPaper (consolidated) - SM 340,000 tons Packaging Paper (Thai, Phil, Viet) 1.88 million tons Bangkok Synthetic (26%) Box (Thai, Malay, Sing, Viet) 795,000 tons - Butadiene 140,000 tons Printing & Writing Paper 565,000 tons - BR 50,000 tons Short Fibre Pulp 425,000 tons - SBR 70,000 tons
Slide 59SCG CementRMC expansion into ASEAN.
Cement
Myanmar Laos
Cambodia
Vietnam
Indonesia
Slide 60
Broad range of product offeringRoofing products Ceramic tiles Fiber cement products Sanitary ware / fittingsAutoclaved lightweight concrete blocks
HVA accounts for >40% of existing sales.
Integrated solutions provider� Home Solution Center� Roofing Center� Cotto tile studio� Cotto speed bathroom� Modular house (Sekisui Heim jv)
SCG Building MaterialsWorld’s top 2 largest ceramics producer, with diversified offerings of products and services.
Slide 61
� Leading supply chain solution provider, whereby non-SCG clients accounts for approx 40% of total sales.
� Global international trading coverage is provided by the 35 global offices in 24 countries.
� Domestic logistics service provider to +200 clients, with +30 MT hauled in FY2011.
� Network of more than 450 exclusive domestic distributors nationwide.
SCG DistributionPrimarily logistics, global trading, and domestic distribution.
Slide 62SCG DistributionKokoh’s 22 distribution centre in Indonesia
Slide 63SCG InvestmentContribution in FY2011 was approx 1,009 MB in equity income, and another 2,346 MB from dividend income.
SCG Investment
Siam Kubota Leasing
Siam Kubota Metal Tech
Aisin Takaoka Group (30%)
Musashi Auto Parts (21%)
Siam Lemmerz (30%)
Michelin Siam Group (10%)
Siam Toyota Manufacturing (4%)
Automotive business
Toyota Motor Thailand (10%)
SiamYamato Steel (10%)
OthersAgricultural business
Siam Kubota Corp (40%)
Slide 64SCG eco valueThailand’s first eco label, accounting for 13% of SCG’s 2011 sales, or approx 47,000 MB.
Cool Roofing System40% Energy Reduction
Cerafino Solar Roof TilesSolar Power
Heat Insulation STAYCOOLRecycled Contents > 80%
COTTO Sanitary Ware and FittingsReduces Water Usage by 25%
Slide 65
2,7733,441 3,722
4,228
2,038 1,703 1,560
428
527
727 567
698
2,752
971445
466
0
2,000
4,000
6,000
8,000
Q1/10 Q2/10 Q3/10 Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 Q1/12
Chemicals EBITDA
EBITDA Margin
10% 9% 9% 7% 9% 4% 3% 3% 1%
Note : EBITDA = EBITDA from operations + dividend from associated companies
MB
4,429
- 82% y-o-y- 55% q-o-q
Dividend fromassociatesEBITDA fromsubsidiaries
EBITDA
3,300
4,168 4,289 4,2674,926 4,789
2,674
2,005
1,636
2,631 894
Slide 66Chemicals profitability
1,371 1,689 1,982 1,2632,193
1,064 1,765672 764
1,674 1,3891,863
1,415
2,595
1,4351,465
476
9,963
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
Q1/10 Q2/10 Q3/10 Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 Q1/12
Divestment GainEquity Income from Assc.Subsidiaries Profit
-74% y-o-y+85% q-o-q
3,045 3,0783,845
12,640
MB
4,788
2,4993,329
6721,240
Slide 67
3,301
2,6162,486
2,407
3,7553,386
3,193
2,447
3,915
1,924
1,4811,323 1,285
2,241 1,9901,848
1,209
2,519
0
1,000
2,000
3,000
4,000
Q1/10 Q2/10 Q3/10 Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 Q1/12
Cement financials
EBITDA 26% 22% 21% 20% 26% 25% 23% 19% 24% margin 22% 24%
MBEBITDA
+4% y-o-y+60% q-o-q
Net Profit+12% y-o-y
+108% q-o-q
Slide 68Paper financials
2,424
2,630
2,403
1,672
2,5472,350 2,348
1,566
2,215
974 1,170
931
415
1,054 1,007 918
352
1,010
0
400
800
1,200
1,600
2,000
2,400
2,800
Q1/10 Q2/10 Q3/10 Q4/10 Q1/11 Q2/11 Q3/11 Q4/11 Q1/12
MB
EBITDA Margin All 19% 21% 18% 13% 1 9% 18% 16% 12% 16% Packaging 16% 17% 14% 11% 17% 15% 14% 11% 15%P&W 25% 28% 26% 16% 22% 22% 21% 14% 17%
EBITDA-13% y-o-y
+41% q-o-q
Net Profit-4% y-o-y
-+187% q-o-q
Slide 69Segmented financials
Sales (MB) 2008 2009 2010 2011 Q1/12 Assets (MB) 2008 2009 2010 2011 Q1/12
Consolidated 293,230 238,664 301,323 368,579 102,884 Cons olidated 285,776 315,986 359,219 374,653 386,780
Chemicals 136,527 101,115 144,317 192,929 52,900 Chemicals 138,504 165,947 165,087 176,614 183,098
Paper 47,110 42,729 51,714 54,839 13,985 Paper 51,089 48,271 50,127 52,542 54,223
Cement 49,999 46,661 48,954 54,249 16,091 Cement 60,770 60,680 61,018 60,180 66,960
Building Materials 23,351 26,873 30,719 34,171 10,315 Building Materials 22,654 22,992 24,796 35,804 39,858
EBITDA (MB) 2008 2009 2010 2011 Q1/12 Profit for the Period (MB) 2008 2009 2010 2011 Q1/12
Consolidated 38,783 47,116 45,949 46,253 10,301 Consolida ted 16,771 24,346 37,382 27,281 5,972
Chemicals 12,598 19,482 16,024 14,394 894 Chemicals 6,136 12,556 22,609 11,190 1,240
Paper 6,660 7,901 9,129 8,811 2,215 Paper 1,658 2,286 3,490 3,331 1,010
Cement 11,272 11,616 10,810 12,781 3,915 Cement 6,006 6,214 6,014 7,288 2,519
Building Materials 4,085 4,907 5,489 5,060 1,917 Building Materials 778 1,617 1,872 1,476 893
EBITDA Margin (%) 2008 2009 2010 2011 Q1/12 EBITDA / Assets (%) 2008 2009 2010 2011 Q1/12
Consolidated 12% 18% 14% 11% 10% Consolidated 14% 15% 13% 12% 11%
Chemicals 7% 17% 9% 5% 1% Chemicals 9% 12% 12% 8% 2%
Paper 14% 18% 18% 16% 16% Paper 13% 16% 16% 17% 16%
Cement 23% 25% 22% 24% 24% Cement 19% 19% 19% 21% 23%
Building Materials 16% 18% 17% 14% 19% Building Materials 18% 21% 20% 14% 19%
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