SCG announces strong operating results in 2021 despite inflation and COVID-19

SCG announced strong operating performance in FY2021 despite inflationary pressures, rising energy, and raw materials costs, as well as the COVID-19 pandemic by driving business transformation to address three megatrends: incorporating ESG into business operations, leveraging digital transformation to meet customer demands that help lower production cost and grow e-commerce, developing new solutions to meet wellness trend and improve quality of life. SCG is prepared to look after the society to reduce inequality and increase income for communities in Thailand and ASEAN.

Mr. Roongrote Rangsiyopash, President and CEO of SCG, disclosed, "The Company's unaudited Operating Results for FY2021 registered the Revenue from Sales of 380,145 Billion VND (US$ 16,576 Million), an increase of 33% y-o-y, owing primarily to improved performance of all businesses, particularly the prices and sales volume of chemical products. Profit for the year totaled 33,829 Billion VND (US$ 1,475 Million), an increase of 38% y-o-y, thanks to better performance of Chemicals Business.

Mr.Roongrote Rangsiyopash, President and CEO of SCG, announced Q4/2021 operating results

SCG's Revenue from Sales of High Value-Added Products & Services (HVA) in 2021 was 130,364 Billion VND (US$ 5,707 Million), or 34% of total Revenue from Sales. Additionally, New Product Development (NPD) and Service Solutions accounted for 15% and 5% of total Revenue from Sales, respectively.

Revenue from Sales totaled 95,111 Billion VND (US$ 4,274 Million), in Q4/21, an increase of 8% q-o-q due to improved performance of all businesses. Profit for the period stood at 5,538 Billion VND (US$ 249 Million).

Besides, SCG's Revenue from operations outside of Thailand, including export sales from Thailand, registered 161,924 Billion VND (US$ 7,595 Million), in FY2021, or 46% of total Revenue from Sales, 44% higher than the previous year.

SCG in ASEAN (ex-Thailand)

For SCG’s operation in ASEAN (ex-Thailand), the Revenue from Sales in Q4/2021 recorded a 62% increase y-o-y, amounting to 28,301 Billion VND (US$ 1,242 Million), and 29% of SCG’s total Revenue from Sales. This includes sales from both local operations in each ASEAN market and imports from the Thai operations. As of 31 December 2021, the total assets of SCG amounted to 587,782 Billion VND (US$ 25,795 Million), while the total assets of SCG in ASEAN (ex-Thailand) were 266,535 Billion VND (US$ 11,697 Million), 45% of SCG’s total consolidated assets.

In Q4/2021, SCG’s total asset in Vietnam was 146,794 Billion VND (US$ 6,442 Million), an increase of 32% y-o-y mainly in the chemicals business from Long Son Petrochemicals (LSP). The company reported Q4/2021 Revenue from Sales at 10,033 Billion VND (US$ 440 Million), up 46% y-o-y mainly from export sales from Thailand to Vietnam.

For 2021, SCG in Vietnam reported Revenue from Sales of 35,001 Billion VND (US$ 1,526 Million), which is a 32% increase y-o-y mainly from sales from new acquisition of Packaging, VKPC operation and Chemicals operation (TPCVINA) as well as export sales from Thailand and ASEAN to Vietnam.

SCG continues to support communities during the COVID-19 pandemic by donating real-time PCR testing equipment worth over 9 Billion VND to Hanoi and paper beds to Southwest provinces. Moreover, the company pursues the flagship scholarship program, SCG Sharing the Dream, to expand education opportunities for nearly 300 high school and university students nationwide, up to 2.1 Billion VND. SCG affirms as the leader in sustainability with its 6 subsidiaries listed in the top 100 most sustainable companies by the Corporate Sustainability Indexes (CSI), one of the most prestigious sustainability awards in Vietnam organized by the Vietnam Business Council for Sustainable Development (VBCSD).

Mr. Roongrote said, "During the year 2021, economies around the world had been impacted by rising energy and raw material costs, inflation, and COVID-19, but SCG has steadily been accelerating business transformation. As a result, it has maintained satisfactory growth over the past year by aligning the business with three megatrends: incorporating ESG into business operations, leveraging digital transformation to meet customer needs, and developing innovative solutions to meet wellness trends and improve the quality of life.

Incorporating ESG (Environmental, Social, and Governance) into the business operations. SCG has adopted ESG 4 Plus, which includes four approaches: Set Net-Zero, Go Green, Reduce Inequality, and Embrace Collaboration with fairness and transparency as a standard developmental framework for its global business practices in line with the United Nations' Sustainable Development Goals (SDGs) and the government's BCG Economy. SCG has committed an initial investment of 47 million VND (70 billion baht) by 2030 to improve the production process and develop low-carbon businesses to achieve net-zero greenhouse gas emission within 2050. In 2021, greenhouse gas emissions were lowered by 1.3 million tons of carbon dioxide (a reduction of 4.1% over the same period in 2020) and increased the proportion of SCG Green Choice product sales from 33% in 2020 to 41% in 2021.

Leveraging digital transformation to address new customer needs and add value to minimize cost and time while increasing performance. Examples include Digital Twin technology, a virtual agent that aids in the evaluation and efficient modification of production patterns; CPAC Green Solution that adopts digital technology to optimize construction efficiency; the development of digital platforms to manage the largest distribution network, including 'Prompt Plus', a building material e-commerce platform for over 9,000 retail stores nationwide and "Rak Mao", a building material e-procurement platform for over 50,000 customers including developers and small and medium-sized contractors across Thailand.

The approaches also include developing innovative solutions to meet wellness trends and improve the quality of life, such as medical-grade plastic innovation Isolation Capsule for Air Transportation; soluble laundry bags to reduce the risk of infection patient's clothing; Smart Building Solution, an innovative building system management solution that uses IoT technology to improve air quality and save energy; Ultra Clean Wall Solution, a smart board innovation that keeps the room clean and germ-free; SCG Bi-Ionization Air Purifier, that eliminates bacteria and viruses in homes and buildings; SCG Solar Roof Solutions, which can generate electricity from the roof and garage roof to help reduce electricity costs and utilize electricity with electric vehicles.

Businesses should be prepared for the increased energy and raw material prices due to inflation. As purchasing power begins to recover, market forces drive up the prices of goods and services. Thus, business strategies in each industry must be appropriately optimized, have the financial discipline to cope with rising interest rates, create innovation to meet the ever-changing customer demands, on top of the business's adoption of digital technology. “SCG has devised business strategies to address the inflation and build long-term growth in each of its businesses in line with three megatrends", said Roongrote.

Additionally, SCG is committed to contributing to society following ESG principles aimed at reducing inequality. To assist unemployed individuals affected by COVID-19, the company has established in-demand skill development programs with over 3,000 participants and intends to reach 20,000 participants by 2025. Several examples include upskilling truck drivers through the SCG Skills Development School, providing handymen's renovation job opportunities through the Q-Chang application, developing careers in product processing and online/offline e-commerce through the Community Power Project, and developing assistant nurses, assistant dentists, and elderly caretakers through the “SCG Foundation's Learn to Earn project”.

Furthermore, SCG provides educational scholarships to needy students throughout ASEAN to help them pursue careers such as doctors, nurses, engineers, and teachers. SCG also educates communities about water management to ensure an adequate water supply for consumption and farming, which will increase productivity to maintain their stable incomes. Additionally, SCG delivered COVID-19 innovations worth 300 million VND (470 MB) to Thailand and ASEAN countries.