SCG Packaging Plc (SCGP) has revised up its revenue target for 2022 to 150 billion baht after seeing its earnings in the first half increase by 31% year-on-year to 74.6 billion baht.
The company earlier expected to earn 140 billion baht this year, with constant growth in revenue of over 10% a year.
Wichan Jitpukdee, chief executive of SCGP, attributed strong sales in the first six months to various factors, including growing demand for fibre and food service packaging.
The solid business performance was particularly driven by sales in the second quarter, he said.
Revenue in this quarter was recorded at 37.9 billion, an increase of 27% year-on-year.
However, from January to June, SCGP saw its earnings before interest, tax, depreciation and amortisation (Ebitda) and profit decline, compared with the same period last year.
Ebitda fell by 4% year-on-year to 10.3 billion baht while profit plunged by 20% year-on-year to 3.5 billion baht.
The decreases resulted from higher prices of energy and raw materials, following the Russia-Ukraine war.
SCGP is closely monitoring the global macroeconomic situation, ranging from the impact of the war on global oil prices to rising inflation and a possible recession.
Yet the company is positive about overall demand for packaging in Thailand and Asean in the second half of this year, said Mr Wichan.
He expects demand will be driven by governments reopening countries to stimulate the economy and boost the tourism industry.
Demand for packaging is improving, especially in the frozen and canned food as well as pet food segments.
SCGP is maintaining its investment budget for 2022 at 20 billion baht, which will be spent to increase production efficiency as well as support organic growth and merger and partnership plans.
The company earlier offered to buy a 100% stake in Peute Recycling BV, the largest packaging material recycling company in the Netherlands, in a move to further grow its recycling business.
The acquisition is important to SCGP's long-term strategy which is aimed at strengthening all levels of its packaging businesses.
