Investment and High Energy Costs Weigh SCG Packaging’s Profit Down 30% in 2022

SCG Packaging Public Company Limited (SET: SCGP) has announced its financial statement of 2022 through the Stocks Exchange of Thailand as follows;

Year 2022 2021
Net Profit (Loss)
Million Baht
5,800.61 8,294.37
Earning Per Share
1.3500 1.9300
% Change -30.07

SCGP reported a net profit of 5,800 million baht in 2022, decreased 30.07% from a net profit of 8,294 million baht in 2021. The decrease was mainly due to high energy cost and contraction of packaging paper sales volume in the midst of weakened global and regional demand as net profit margin dropped from 7% in 2021 to 4% in 2022. Notably, net profit margin in 4Q22 was as low as 1%, compared to 6% in 4Q21.

For SCGP’s 2022 performance, total revenue from sales recorded at 146,068 million baht, increased 18% YoY supported by business growth through both organic expansion and Merger & Partnership (M&P) including the commercial start-up of packaging paper plant in the Philippines (UPPC 3), full-year financial consolidation of completed Merger&Partnership (M&P) in rigid packaging manufacturer (Duy Tan), corrugated carton producer (Intan Group), medical supplies and labware specialist (Deltalab) and partial consolidation of international packaging material recycling business (Peute and Jordan) as well as product prices adjustment to align with the rise in costs.

Integrated Packaging Business remained SCGP’s main revenue contributor, recording 11% growth in 2022 at 117 billion baht. Meanwhile, Fibrous Business saw the highest growth with 30% to 24 billion baht.

Cost of sales was 121 billion baht, increased 20% YoY. The increase in cost of sales was mainly from the consolidation of new M&P companies, the completion of organic expansions and the rise in energy costs. Nonetheless, raw material prices and freight costs continued to improve since 2Q22.