2018 was the year which the price of sugar in the global market had high volatility and a record-breaking decreased price. The price of raw sugar in the global market opened at 15 cents/lbs in January and dropped to 9.83 cents/lbs in September before rising to be closed at 12.03 cents/lbs in late December.
The Company has studied the possibility of expanding the investment on new businesses for generating additional values of the company. Also, the company is willing to develop both of its employee and the sugarcane farmers in respect of the mission – “Sugarcane Agriculturist Businessmen”
Chairman of the Board of Directors
Whereas, the average price is 12-13 cents/lbs; compared with the same period in the previous year at 20 cents/lb. The main cause was the significant increase of productivity of the major sugar-producing countries including India, Thailand, the European Union and China; and, the boost on Indian Sugar export, the change of trends in sugar consumption, together with the stock of the sugar in global market was still high compared to the demand consumption - this exceeded products affected the pressure on the price.
Moreover, the global economic had slowed down due to the trade war between China and the United States which caused the oil prices tending to drop and affected the commodity prices to fall as well. At the same time, the government’s announcement for restructuring the sugarcane and sugar industry management in the beginning of the year; especially the cancellation of quotas system and the floating of sugar retail prices which was the result of Brazil's accusations against Thailand with the World Trade Organization (WTO) that Thailand subsidize the sugar and sugarcane industry which distorted the market and caused damages to Brazil. As of which, the restructuring affected the internal sugar price that decreased based on the global market price, and it also decreased sales volume as well.
Nevertheless, according to the aforementioned factors of economic and the demand and supply of the sugar; the company’s operation result of 2018 earned revenues from the sales of goods and services in total of 5,555.97 million Thai Baht and the net profits of 271.67 million Thai Baht. Even though, there were external factors affecting the overall operations of the company, the company does have the long-term protocols for making the company's performance grow sustainably - by promoting and supporting the farmers to plant sugarcane as Contract Farming, including developing the new innovations related to the sugarcane’s breeds. In addition, there is the management system for supporting plantation, managing the farmer system with online farm systems and other information technology management systems, including providing education to the farmers, in order to develop the productivity which is the significant factor of successful sustainable business development of the company.
Moreover, in order to respond to the consumer’s behavior which will change in the future in accordance with the globalization (Mega Trends), the company has studied the possibility of expanding the investment on new businesses for generating additional values of the company. Also, the company is willing to develop both of its employee and the sugarcane farmers in respect of the mission – “Sugarcane Agriculturist Businessmen”; for making the sugarcane farming as a stable career – good income with happiness, and be able to pass on experiences and knowledge from generation to generation and inherit the business to every generation because the company believes that these things shall bring the sustainability in term of the business operations.
In regards of the biomass power plant in the previous year, the power plant group earned revenue from the operation in amount of 972 million Thai Baht with the net profit of 410 million Thai Baht which is 78% higher than 2017. Moreover, Buriram Power Co., Ltd. (“BPC”), a subsidiary company has achieved the Excellence Award for the bagasse-fired cogeneration power plant project from Air Chief Marshal Prajin Jantong, Deputy Prime Minister and Minister of Justice in Thailand Energy Awards 2018 , hosted by the Department of Alternative Energy Development and Efficiency - Ministry of Energy, and it also achieved the First-runner up Award on the cogeneration category at the 36th ASEAN Ministers on Energy Meeting (36 AMEM) Singapore.
Regarding of the by-product business in previous year, the company was established Sugarcane Ecoware Co., Ltd. (“SEW”), a subsidiary company with the purposes to produce, distribute, import and export packages, tools and equipment made of bagasse and other natural materials. Whereas, SEW is estimated to be able for starting the commercial production in mid-2019.
Furthermore, in respect of the social and environmental responsibility, the company has operated based upon the idea of "Business development with environment conservation and creating sustainable progress to the community" by strengthening the communities surrounding the establishment such as; Organic Jasmine Agriculture Promoting Project in the Non Klang community, in order to increase the income and strengthen the community. Also, the company has collaborated with the Zoological Park Organization under the Royal Patronage of His Majesty the King on the construction of the King's Eastern Sarus Crane Learning Center at Non-Hunting Area in Huai Saeng Nua, Mueang District, Buriram Province. Nonetheless, the social responsibility of the company is one of the important key factors which will lead the organization to grow sustainably along with developing of the quality of living of the sugarcane farmers, neighbor community and its employees for better sustainability.
In term of corporate governance, the company has received the certificate as a member of the Collective Action Coalition Against Corruption (CAC) on June 7th, 2018. Hence, the company has conducted businesses in accordance with the policy and measures on anti-corruption continuously, as well as informed and communicated such matter to business partners and related parties, including organized in-house seminars and campaigns for the personnel in the organization. Furthermore, the company has opened the channel for receiving the complaint and suggestion (Whistleblowing) for the complaint from stakeholders through the suggestions box and postage which will be sent directly to the Chairman of Corporate Governance Committee. However, there was no any whistleblowing issue or suggestion received from stakeholders in the previous year. On account of overseeing and monitoring the compliance with the good corporate governance, this led to the result of being assessed as “Excellent” with the average score of 93% which is higher than the average score of the overall listed companies of the Stock Exchange of Thailand which were at 81% under the project of the Assessment of Corporate Governance Report of Thai Listed Companies (CGR) in 2018 by Thai Institute of Directors (IOD).
On behalf of the Board of Directors, Executives and all employees, the company would like to thank all of the shareholders and stakeholders for always trust and support the company's business, and kindly be ensured that the company is prepared to the operate the business with sustainability, and also willing to carry on creating the benefits for the country, shareholders and all stakeholders with good governance.