SCG expects total revenue from overseas to reach 60 per cent of its total revenues five years from now when its petrochemical complex in Vietnam is operating, the group’s president and chief executive officer Roongrote Rangsiyopash said at group interview yesterday.
Currently, the company is averaging 43 per cent of its total revenues yearly from overseas.
Meanwhile, the company also expects that up to 10 per cent of its total revenues will come from innovative business solutions in the next five years, compared to today’s average of 2 per cent a year. This is a part of driving sustainable business growth for the long term, as the company expects to grow its total revenues in its Asean operations at a rate above that of Thailand’s yearly growth in gross domestic product, he said.
“We set aside an investment budget of Bt60 billion in this year, with up to 70 per cent of the total invested in Asean countries including Vietnam, Indonesia, and the Philippines. They are a part of our drive for growth in our total revenue from Asean and others countries to exceed that of our revenue in Thailand in the next five years. We believe that the demand in Asean countries in that time will continue our strong growth,” he said.
Last year, the company reported total revenue of Bt478.438 billion, up 6 per cent from 2017. But net profit was Bt44.748 billion, down 19 per cent from the prior year.
Up to 43 per cent of its total revenue came from overseas business – from both exports and its overseas businesses. About 25 per cent of revenue from overseas came from Asean countries, with the next 18 per cent coming from countries such as China and India.
In this year, the company also expects growth above 5 per cent from both businesses in Thailand and overseas, he said.
Roongrote said that the group will focus on three strategies, including investment in innovation and technology, developing products and business solutions that meet its customers’ demands, and investment in Asean countries to balance its portfolio by focusing on three of its business sectors – petrochemical, packaging, and cement and construction raw materials.
“We will not only sell our products, we will also develop our services and solutions to support our customers’ demands,” said Roongrote. “This is the way to drive our business toward sustainable growth for the long term, which is our main objective to do business. By driving our business growth above the Asean GDP growth every year, when we now have more business in Asean. For the next five years we will have income from outside Thailand above our income from the country,” he said.
He said that business now face additional risks due to technology disruption, the market competition from legacy competitors and newcomers to the industries, and the US-China trade war.
New factors will also quickly emerge to impact all industries in the market, he predicted. The way to drive sustainable business growth in a high-risk environment is to ensure a strong but balanced business portfolio, along with also developing technology for products and services that meet the needs of customers who are at the centre of the business.
“When we talk about innovation, we focus on all of the technology that relates to our business by both researching and developing value-added products, innovative products, and also using digital to improve our production, and developing our working process.
“We are also interested in developing deep technology to provide new products to serve our sustainable business growth. This is the way the group does business,” Roongrote concluded.