New markets, off-peak production to drive
Chow Steel Industries is counting on new export markets and off-peak production to drive its total billet sales to Bt8 billion in three years and to cut costs.
Chief executive officer Anavin Jiratomsiri said yesterday that more than 90 per cent of the company’s business was local, so it was looking at Sri Lanka, Bangladesh, the Philippines and the Middle East. He wants to export at least 12,000 tonnes a year to those key markets, as well as Vietnam, which bought about 1,200 tonnes from the company in 2010.
He expects the company’s total sales to surge 20 per cent to Bt5 billion this year by increasing production to 340,000-360,000 tonnes from 280,000-300,000 tonnes last year.
During the first nine months of 2011, Chow generated more than Bt4.25 billion, already passing Bt3.89 billion for all of 2010.
The local steel business is expected to spurt 10-14 per cent on a boom in mega-projects and the need to rebuild homes and infrastructure, particularly irrigation systems.
Electricity is 2.5 times considerably cheaper in the off-peak period from 10pm-9am than the peak period.
The company aims to increase off-peak production to 405,000 tonnes or 90 per cent of its estimated total output of 450,000 tonnes within three years.
With the improvement in results, the company expects to pay dividends of at least 40 per cent of sales this year. It joined the Market for Alternative Investment last year after an initial public offering of 200 million shares.
