Paul Heinz Hugentobler

Chairman of the Board of Directors

Dear Shareholders,

The year under review began as the previous year ended, with the COVID-19 pandemic still raging across the region, and all our countries of operations enforcing travel restrictions and quarantine measures to contain the virus. Vaccination programs did take off only slowly in all countries, but not before large outbreaks happened in Thailand, Vietnam and Bangladesh and forced Governments to massively lock down social and business activities. As a consequence, the business environment remained extremely challenging throughout the entire year 2021.

This already dire situation was compounded by rapidly increasing costs for coal and international sea freight–both factors being critical cost components with impacts on our competitiveness. Again, and as in the previous year, Group Management had to initiate major interventions addressing our cost base, our manufacturing capacities as well as our organizational structures. Despite all adversities, we are confident that our Group will weather all headwinds successfully as we can count on thousands of employees dedicated to advancing the Group with new strengths and new capabilities required to successfully compete in the future. The focus of our initiatives will cover renewed efforts in our go-to-market strategies, in sharpening our products and building solutions to reduce their carbon intensity, in advancing digital applications across all functions, and most importantly, in driving our Sustainable Development Ambition 2030 together with our ESG Agenda.

As we ended the year 2021, we started to see some light at the end of the tunnel. Strong demand surges in Sri Lanka and Vietnam and stabilizing volumes and business activities in Thailand and Cambodia point to a brighter 2022. Nevertheless, we remain extremely cautious in our outlook as we are still faced with extremely high energy and freight costs which will now be compounded with higher inflation and currency devaluation risks. Thus, the Board of Directors and Group Management are fully aligned and prepared to take all necessary steps to maintain both our operational competitiveness as well as our financial performance.

The Board of Directors is pleased to report a net profit after tax attributable to equity holders of THB 4.2 billion, including a one-time tax credit in Sri Lanka of THB 0.7 billion, or THB 3.5 billion on a comparable basis with THB 3.7 billion in 2020. We succeeded in reducing our gearing ratio to 47 percent at the end of 2021 compared to 61 percent at the end of 2020. Net Financial Debt to EBITDA reached just 1.95 at the end of 2021. The Board of Directors will recommend a full year dividend of THB 9 per share to the Shareholders for approval at the AGM.

Our good and dedicated people have continued our history of success in good and bad times. It is to their credit that we are here today in good health and spirit looking forward to brighter days to keep us growing as an organization and as individuals.

As we said in our last year’s message, resilience is a rare quality in an organization, but we are proud to say that our Group has stepped up again to unprecedented challenges in 2021, and our good and dedicated people have continued our history of success in good and bad times. It is to their credit that we are here today in good health and spirit looking forward to brighter days to keep us growing as an organization and as individuals.

On behalf of the Board of Directors, I wish to thank everybody in our Group and our extended range of stakeholders for their commitments and their cooperation to sustain and grow in harmony and for our mutual benefits.