Siam Cement Group (SCG) has experienced a significant decline in profits due to several interrelated factors:
Challenges in the Petrochemical Sector: SCG's petrochemical division has been particularly affected by an oversupply in the market and weak demand, especially from China. This has led to a decrease in product prices and profit margins. (kaohooninternational.com)
Increased Raw Material Costs: The company has faced rising costs for essential materials like naphtha, which has further pressured profit margins. (kaohooninternational.com)
Currency Exchange Losses: Fluctuations in currency exchange rates, particularly the appreciation of the Thai baht, have resulted in financial losses for SCG. (kaohooninternational.com)
Underperformance of Subsidiaries: Certain subsidiaries, such as SCG Express, have consistently reported losses over multiple years, contributing to the overall decline in profitability. (nationthailand.com)
Global Economic Uncertainties: Geopolitical tensions, including conflicts in the Middle East, and the influx of Chinese products into the market have created a challenging economic environment, affecting SCG's operations. (nationthailand.com)
In response to these challenges, SCG has implemented cost-cutting measures, including plans to reduce costs by 5 billion baht in 2025 and to boost liquidity through asset sales and enhanced production efficiency. (nationthailand.com)