SCC’s 2020 earnings were better than expected, reporting 34,144 million baht, an increase of 7% from a year before, supported by better operating results from all business sectors. The Board of Directors approved a dividend payment at 8.5 baht per share, representing a total of 14 baht per share dividend payment last year. The ex-dividend date will be on April 8, 2021, and the payment date will be on April 23, 2021.
Mr. Roongrote Rangsiyopash, President & CEO of The Siam Cement Public Company Limited (SCC), disclosed that SCC expected the total revenue for FY2021 to grow 5-10% YoY from better performance in chemicals and packaging businesses. For the cement-building materials business, he stated that this sector will continue to suffer from the Covid-19 pandemic in 1H21 before possibly rebounding in 2H21.
He stated that the project of expanding the MOC Debottleneck’s olefins production capacity by 350,000 tonnes/year in Map Ta Phut Olefins which expected to be complete in 1Q21 is the key factor to drive up chemicals business this year.
Meanwhile, as the resurgence of Covid-19, cement–building materials business has been struggling with a delay in private construction projects, only government projects that could go on, however, SCC believed this sector will make a turnaround in the second half of this year.
For the CAPEX & investments in 2021, SCC budgeted around 65-75 billion baht consisting mainly of committed Petrochemicals Complex construction in Vietnam, and other efficiency and maintenance projects.
KGI Securities maintained a rating of Outperform with a 2021 SOTP target price of ฿472.00/share. SCC’s 1Q21 earnings are likely to increase QoQ due to i) increasing polyolefin sales volume after the MOC shutdown in 4Q20 and ii) higher profit contribution from SCGP from SOVI and Gopak acquisitions.
KGI said that SCC’s 4Q20 earnings result was in line with its forecast, but 7.6% below the Bloomberg consensus. The increase YoY was due to increased petrochemical spreads. The drop QoQ was due to i) 38-day planned maintenance shutdown of Maptaphut Olefin Cracker (MOC), and ii) asset impairments of CBM in Indonesia and Myanmar cement operations. SCC also announced a 2H20 DPS of Bt8.5/sh (XD on April 8 and payment on April 23), implying a dividend yield of 2.2%.