SQ mining continues aggressive revenue, profit growth

Breaking News August 17, 2017 17:26

By The Nation

Sasavat Sirisan, CEO of Sahakol Equipment Plc, (SQ), which bills itself as the number one mining contractor in CLMVT nations, is showing big growth for the second quarter compared to the same period last year.

The company reports total revenues of Bt913 million, showing a 36 per cent growth over the revenue of Bt673 million posted in the same period last year. Net profits also jumped some 159 per cent to Bt166 million, up from Bt64 million of net profits in the second quarter of last year. For this quarter, the company’s gross profit margin jumps to 35 per cent, from 24.3 per cent from the same period last year.

The six month performance had has revenue at Bt1.93 billion, an increase of 43 per cent over the same period last year.

“This is a result of a strong increase of work in Mae Moh 8 project and the new increased rate, under the contract,” said Sasavat. “Also, the company has more revenues from the Hong Sa Project. Therefore, SQ has achieved a 191 per cent net profit increase to Bt391 million for the first six months, up from Bt134 million in the same period last year.”

Currently, SQ has total signed contract value of Bt36.6 billion to realize over the next 10 years. This consists of a backlog of Bt20.8 billion from the Mae Moh 8 Project, a backlog of Bt10.3 billion from the Hong Sa project, a backlog of Bt1.8 billion from the Mae Moh 7 project and a backlog of Bt3.6 billion from a Tin Mine Project in Henda Town, Myanmar, which is expected to start in the fourth quarter this year.

With its focus on long-term mining projects, Sahakol has grown into the CLMVT’s largest full-service mining contractor, the company reports. The long-term approach requires special mining expertise and extensive capital investment. That leaves them with few competitors, and a higher-than-average gross margin, according to a company press release. As well, SQ has a large and experienced mining engineering team and a large pool of heavy-duty mining equipment, giving them additional competitive advantages.

Sasavat noted that a customer has approved the kick-off of mine production for Mae Moh 9 in the fourth quarter, ahead of schedule and reflecting SQ’s success in completing the contracted work ahead of schedule.

In addition, the company just submitted a bid for Mae Moh 9 project, worth around Bt40 billion and expects to hear the result at the end of the year.

“We are confident that with our successful experiences in mining service for 34 years in Thailand and CLMV, and strong mining engineers and project management teams, and over 50 per cent market shares, we have a good chance." he said.

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