Press Release

15/Aug/01
First-half profit for Padaeng jumped 325% to 402.7 million Baht.

Padaeng Industry Plc, the sole zinc smelter in Southeast Asia, posted a net consolidated profit of 402.7 million Baht in the first half of the year, an increase of 325% from the same period last year, citing higher metal production and sales, the reduction of financial burden and the strength of the US dollar.

In its report filed to the Stock Exchange of Thailand, Padaeng Industry Plc, said its net consolidated profit increased significantly to 402.7 million Baht in the first six months of this year from 94.8 million Baht in the same period last year, sending its earnings per share up to 1.78 Baht from 0.63 Baht. Based on the equity method financial statement, the company’s net operating profit also jumped 133% to 251.8 million Baht for the period from 108 million Baht in the same period last year.

The company attributed the substantial profit increase to higher metal production and sales, the change in product mix to produce more value- added products and a reduction in production cost. Furthermore, the company’s success in capital increase and financial restructuring eased a load of interest payment to 54.2 million Baht in the first half of this year from 131.1 million Baht in the previous year. In addition, the increased profit was a result of profit gained in the first quarter of 150.9 million Baht which was due to deconsolidation of a subsidiary company.

Padaeng produced 50,390 metric tons of zinc metal in the first half of this year, a 10% increase from 45,938 metric tons from the same period last year. Of total zinc metal produced, 35,886 metric tons were zinc ingot and 14,504 metric tons were zinc alloy. On the marketing side, the company sold a total of 51,758 metric tons of zinc metal for the period, up 11% from 46,776 metric tons in the same period last year, of which 39,887 metric tons were sold for the domestic sales, up 12% and 11,871 metric tons for export, up 6%. The proportion of domestic sales to export sales was 77% to 23%, respectively. Sales revenue in the first six months of this year totalled 2,703.4 million Baht, 330.5 million Baht or 14% increase from
the same period last year. The LME zinc price fell by US$ 155 per metric ton to an average of US$ 977 per metric ton in the first half of this year from US$ 1,132 per metric ton in the same period last year. But this was partially compensated by the strength of US dollar which averaged 44 Baht per 1 US dollar during the first half of this year as compared to 38 Baht for the same period last year.

In the second quarter, the company posted a net consolidated profit of 134.6 million Baht, an increase of 435% from 25.2 million Baht in the same period last year. For the equity method, the company’s net operating profit was 133.7 million Baht , an increase of 258% from 37.3 million Baht in the same period last year.

As a result of the improved profit and use of 1,969 million Baht in reserves for the business expansion in the second quarter, as approved by company shareholders in April 2001, which offset the unappropriated retained earning account, the company’s unappropriated retained loss was reduced to a negative balance of 558.4 million Baht in both the company’s consolidated and equity method financial statements. As such, the company will be in the position to pay dividends to the shareholders sooner than expected.

Padaeng Industry Plc, the sole operator of zinc mine and smelter in Southeast Asia, was founded in April 10, 1981 and has a production capacity of approximately 100,000 metric tons per year of metal.