Diamond Building Products to invest for higher output
Diamond Building Products, a construction-materials provider, is planning to invest around Bt300 million to increase its annual production capacity.
Meanwhile, it has cut this year’s revenue-growth forecast from 10 per cent to only 4 per cent because of the ongoing drought crisis.
The company produces, sells and exports construction materials including roofing, bricks and synthetic wood. Its main customers are low-to-middle-income people, mostly farmers.
"Amid the ongoing drought crisis, the sales of agricultural products suffer, and it is reflected in lower purchasing power of the company’s customers. With that, we will focus more on exports to Cambodia, Laos, Malaysia and Vietnam in the second half of the year," chief operating officer Sutid Sudbuntad said yesterday at a press conference.
Exports now contribute around 10 per cent of the company’s revenue, but it will try to increase that to around 15 per cent. This year, 80 per cent of its exports will be to CLMV (Cambodia, Laos, Malaysia and Vietnam) countries, he said.
Sutid said that number of foreign property developers investing in CLMV had increased in the last three years, so the demand for construction materials had also gone up. The company now has more than 10 dealers in those countries.
To serve the increasing demand in the neighbouring countries, the company is planning to invest around Bt300 million in the development of its existing factories to increase production capacity by about 200,000 tonnes a year, or 20 per cent, by 2017. The investment is expected to come from the company’s cash flow, he said.
The company now owns three factories in Khon Kaen, Chiang Mai and Saraburi.
Meanwhile, the company has decided to cut its full-year growth forecast to only 4 per cent to about Bt4.4 billion from last year’s Bt4.2 billion. The growth in revenue was previously set at 10 per cent, to Bt4.6 billion. This year’s net profit will be around 7 per cent of revenue. Also, it expects 10-per-cent growth in revenue with the same rate of net profit in each of the next five years.
In the first quarter of this year, the company reported revenue Bt1.18 billion and net profit Bt95.83 million.
