Steel hit by strong baht
Sahaviriya Steel Plc expects sales this year to drop 3 per cent due to the baht's appreciation against the US dollar.
Pissamai Saibua, finance director, told Infoquest that total sales, estimated to grow 10-15 per cent this year from US$110 million (Bt4.2 billion) in 2005, would be slashed as the baht has strengthened against the greenback."The company's sales are entirely denominated in the US dollar, while we have to order raw materials two or three months in advance," she told the news agency. Exporters have cried foul over the strengthening baht, which cuts their competitiveness against overseas rivals. The baht yesterday ended at Bt38.40, down from Bt38.155 at Friday's Asian close. However, Pissamai said that sales in the second and third quarter would grow faster than the same periods last year, due to higher steel demand from European manufacturers of television sets and mobile-phone equipment. In the first quarter of this year, SVI reported turnover of Bt997 million, down almost 12 per cent from Bt1.129 billion in the same period last year. The income in the quarter was converted to baht at the exchange rate of Bt39.28 per dollar, while raw materials bought in the fourth quarter last year were quoted at the rate of Bt40.95 per dollar.
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