SCG Ceramics announced its Q1 2020 earnings, reporting a 4% decrease in profit compared to the previous year. The company is accelerating its sales model transformation to align with changing customer behaviors, highlighting its technological strengths in product development. It has launched Hygienic Tiles to meet hygiene needs, along with easy-to-install flooring and DIY systems.

Mr. Nampol Malichai, Managing Director of SCG Ceramics Public Company Limited, the producer and distributor of tiles under the brands COTTO, SOSUCO, and CAMPANA, revealed that the unaudited financial statements for COTTO in Q1 2020 showed sales revenue of 2.523 billion baht, a 16% decrease from the same quarter last year due to reduced sales volume and lower land sales.



The company reported a profit for the period of 125 million baht, down 4%. However, excluding profit from land sales in the previous year, profit would have increased by 128% compared to the same quarter last year, thanks to better control of administrative and production costs, improved machinery efficiency, and investments in expanding distribution channels, along with lower energy costs due to decreased natural gas prices.

Sales revenue in this quarter decreased compared to the same period last year due to a decline in domestic sales driven by overall market demand. Early in the quarter, negative factors stemmed from the real estate sector and construction contracting due to purchasing power, influenced by LTV measures and stricter lending policies from financial institutions, as well as drought and pollution issues. Towards the end of the quarter, the slowdown in the economy and the COVID-19 crisis further impacted sales. Nevertheless, sales to international markets, particularly in the CLM countries, managed to maintain sales volume close to last year’s levels.


Mr. Nampol stated that during the COVID-19 crisis, the government implemented various policies to control the outbreak, which affected consumers and companies to some extent. However, the company has leveraged technology and online communication to enhance operations, especially in selling products through online channels such as the website www.cottolife.com, Facebook pages for the COTTO, CAMPANA, and SOSUCO brands, as well as the Ceramic Warehouse. The company has adapted its operations to align with customer behaviors by reallocating in-store sales staff to support online sales to meet customer demand.

“Online sales channels have become a primary sales avenue for COTTO Life, especially during the lockdown period. Most sales during this time came from direct online sales and from an Omni-Channel approach, starting online and leading to phone consultations and sales with customers. Additionally, live selling on the Ceramic Warehouse's Facebook page has received excellent feedback, with customers placing orders each time. It is evident that sales from all online channels have continuously increased, reaching new highs, showing that a significant number of our customers are digitally savvy,” Mr. Nampol said.

Furthermore, the company has been closely monitoring changing customer behaviors and is rapidly developing responses to align with these changes, whether it be the trend of hygiene, which will be increasingly important in the future, or the trend of “staying at home.” The company has developed products that cater to customers who want to easily and conveniently customize their living spaces.

COTTO has utilized technological advancements to develop Hygienic Tiles that meet Japanese industrial standards JIS Z-2801, which have properties to prevent and inhibit bacterial growth, addressing consumer concerns for health and safety. Importantly, as customers are spending most of their time at home to stop the spread of the virus, we have developed products that facilitate easy and convenient customization of spaces, such as COTTO Quick, a quick-install flooring system that customers can lay themselves without the need for cement adhesive. Recently, we also launched a new product: Smart Flexible Flooring by COTTO, featuring a click-lock system from Sweden that is easy and convenient to install, allowing customers to complete installation in just 1-2 days for residential areas,” Mr. Nampol stated.

“Regarding cost management, the company continues to implement plans to reduce energy costs, which are a major production expense, alongside improving machinery efficiency. Even in a situation where the company must control production costs and expenses, we remain focused on maintaining product and service quality to ensure we can adapt to future situations while sustaining the strength of our domestic operations,” Mr. Nampol concluded.