1Q/2016 ANALYST MEETING PRESENTATION
Agenda STRATEGIC EXECUTION 1Q/2016 FINANCIAL RESULTS MARKET OUTLOOK APPENDIX 2
Agenda STRATEGIC EXECUTION 1Q/2016 FINANCIAL RESULTS MARKET OUTLOOK APPENDIX 3
1Q/2016 Highlight Market Environment (+) Rebound of oil price from $31.21/bbl at end 2015 to $36.01/bbl at end 1Q16 45 Dubai @ $43.96 /bbl (+) Reduce in US crude production of around 21 KBD to 9,140 KBD (+) US rig count decreased 234 rigs YoY to 464 rigs (+) Aromatic producer major S/D in 1H16 (+) HDPE price move up from bottom at $1,075/T in Jan to $1,112/T in March 40 (-) Drop in Gas Oil spread from more supply (-) MEG spread dropped from demand slowdown 35 Dubai @ $31.21 /bbl PTTGC’s Performance Despite external factors 30 • Lower refinery crack spread • Lower HDPE price Internally we were able to … 25 • Increase Aromatics in sales volume • Mitigate Olefins 3 shutdown by building PE inventory PTTGC maintained Adj. EBITDA margin at 12% 20 January February March April 4
1Q/2016 Highlight • Commission : Dec 2015 • Commission :Feb 2016 • COD : May 2016 • COD : May 2016 • Capacity : • Capacity : • PX 115 KTA, • PH 250 KTA • BZ 35 KTA, • AC 155 KTA • OX 20 KTA • CAPEX : 345 MUSD ARO II Expansion • EBITDA Uplift /Y*: 63 MUSD • CAPEX : 128.8 MUSD Phenol II • EBITDA Uplift /Y*: 24 MUSD on stream commissioning • Commission :2Q/2016 • Total repurchased 48,553,000 • COD : 3Q/2016 shares or 1.077% of the total • Capacity : paid-up capital at average • HDI Deriv. 12 KTA price of 50.14 baht/share. • CAPEX : 43 MUSD Repurchase period ended • Product : HDI derivative March 7. • EBITDA Uplift /Y*: 9 MUSD VCR TH ready for Treasury Stock commissioning Program Closed • Commission : 2Q/ 2016 • COD : 3Q/2016 • Capacity : • HDI Mono. 70 KTA • CAPEX : 18 MUSD VCR FR ready for • Product : HDI monomer commissioning • EBITDA Uplift /Y*: 24 MUSD 5 *EBITDA Uplift per year at mid cycle price
Strategic Direction To be a Leading chemical company for Better living Sustain Core Balance Business & Social Accelerate Value Growth levers Performance International hub Sustainable excellence development Performance Maximize value chemicals Effective CSR programs creation Green business Stakeholder Map Ta Phut retrofit management 6
Sustain Core : Value Creation Top Down Study Detail Study Implementation • Due diligence • • process to Develop initiatives and Execute per plan to execution plans capture value estimate project potential 12 Weeks 6 Weeks 18 Months Plant Commercial & Operational Marketing Capex Excellence Excellence Excellence Asset Procurement Performance Excellence 7 Excellence
Sustain Core :MTP Retrofit Project Scope • Build new Cracker 500 KTA ethylene for flexible feed cracker to utilize internal naphtha • Maximize utilization of the existing utilities and support facilities to reduce investment cost Project Update • Issued pre qualification enquiry package to prospect bidders. • Awarded project manager contractor • Issued conceptual design to licensors • Completed EPCa Scope package • Submitted BOI application Timeline : 2016 2018 2020 COD 2020 1Q/18 8 ITB Construction
Accelerate Growth Levers : PO & Polyols Project Project Update • Completed PO & Polyols market survey • Building sale & marketing strategy • Ongoing FEED work and preparing ITB • Preparing EIA report • Negotiating feedstock arrangement • Engaged FA and expect FID in 4Q/16 Polyols 130 KTA System House 40 KTA Timeline : -------------------------------------- Licensor PO Market Survey Polyols Market Survey ≈ 80% Reserved Volume Merchant Construction After surveyed 106 Volume customers , we have arrived 20% to Potential Customers Captive and 200 Committed KTA 80% Market survey result concluded that E&E SEA and India are the target market. • Target market growth rate average Merchant Market at 5 - 7 % during 2014 - 2023 • The highest growth rate is in Automotive Automotive segment 6.8 % Marketing strategy is to focus on 9 high value application segment 9
Accelerate Growth Levers : US Petrochemical Complex Project Overview Project Update • FEED : FEED contractors on schedule to deliver cost estimates within 3Q/16 • Feedstock : In discussion with specific names of ethane supplier to finalize contract terms • Marketing & Logistic : • Preparing marketing and sale plan as well as key terms in offtake agreement • Received proposals from barge, railcar leasing, and packing service • Discuss with potential offtaker. • Permit: Signed off on the First Energy land option agreement • Partner : Approached FA in the process to short list of potential partner Key Criteria for FID United • Investment cost justify investment return Marcellus States Shale Gas • Enough ethane capacity with competitive Reserve pricing structure • Partner can distribute products in N. America 10
Accelerate Growth Levers : Growing in AEC Market • Sign MOU with Sahapat and DITP to collaborate in product development, area development and market development • Introduce InnoPlus ’ customer to the area and Potential demand in AEC with high growth rate conduct survey for Estimated Demand for PE Product (KTA) in 2015 investment interest 1500 1,500 • Three customers have • Indo Thai Trading (ITT) – Trading 1200 1100 confirmed to expand company, a JV between PTTGC and business in Mae Sot area 600 Pertamina to penetrate into Indonesia polymer market. Sales of 200 60 24 11 ITT has been increasing with volume of approx. 9,500 / month. 11
Agenda STRATEGIC EXECUTION 1Q/2016 FINANCIAL RESULTS MARKET OUTLOOK APPENDIX 12
Business Environment & Operations Recap Average and Ending Dubai Crude Price: USD/BBL o Surplus crude and weak demand pressured Dubai crude to decline from average at 40.7 USD/BBL in 4Q/15 to average at 30.4 USD/BBL in 1Q/16 (2015 year end closing at 31.8 USD/BBL). As a result, PTTGC Average Price Closing Price reported Stock Loss & NRV totaling 274 M.THB for the year. 96.6 o FX Gain amounting to 632 M.THB, resulting from appreciation in THB against USD from ending at 36.25 THB/USD in 4Q/15 to ending at 35.41 in 1Q/16. 53.4 60.2 o Modest Refinery GRM, better adjusted EBITDA margin in Aromatics 50.9 43.5 and healthy Olefins margin 31.8 34.9 YoY QoQ 1Q/15 4Q/15 1Q/16 +/(-) +/(-) 51.9 61.3 49.7 40.7 30.4 CDU Utilization Rate 102% 99% 93% -8% -5% ULG95 - Dubai 15.4 18.7 18.8 23% 1% 2014 2015 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16 Jet - Dubai 17.1 14.1 11.7 -32% -17% Average and Closing FX : THB/USD Diesel - Dubai 16.3 13.8 9.6 -41% -30% Fuel Oil - Dubai -1.9 -6.6 -5.2 -178% 21% GRM on CDU (USD/BBL) 8.0 8.3 6.1 -23% -26% Average FX Closing FX 36.53 36.25 88% 66% 90% 2% 24% BTX Utilization Rate PX- Condensate 333 410 415 25% 1% 35.41 BZ- Condensate 217 230 272 25% 18% -8% -20% Market P2F (USD/Ton) 219 251 201 33.93 34.25 32.70 Olefins Utilization Rate 96% 97% 81% -14% -16% 32.48 Polyethylene Utilization Rate 107% 103% 89% -19% -14% MEG Utilization Rate 108% 117% 96% -13% -21% HDPE Price 1,188 1,153 1,103 -7% -4% 32.65 33.26 35.25 35.84 35.67 MEG - 0.65 Ethylene 236 165 74 -69% -55% % Adj. EBITDA Margin 19 22 20 1 -2 2014 2015 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16 13
Refinery Performance Modest Refinery GRM Petroleum Products - Dubai Spread (USD/BBL) Total Intake (KBD) CDU U-Rate +28% YoY +23% YoY ULG 95 - DB 102% 100% 101% 99% 93% +1% QoQ 102% 100% Crude Condenstate Residue & Others 15.3 19.8 19.3 18.7 18.8 14.3 18.3 208.1 211.1 196.1 206.0 203.7 205.3 199.4 -4% YoY +1% YoY 60.5 66.9 2014 2015 56.2 60.0 62.9 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16 49.7 -3% QoQ 63.9 -13% YoY -32% YoY -17% QoQ JET - DB 17.1 13.5 10.9 14.1 11.7 15.9 13.9 147.5 147.6 145.3 144.2 146.4 143.1 135.5 2014 2015 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16 -15% YoY -41% YoY Diesel - DB -30% QoQ 2014 2015 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16 16.1 13.7 16.3 13.7 10.8 13.8 Gross Refinery Margin (USD/BBL) 9.6 Market GRM Stock Gain/(Loss) Net NRV 2014 2015 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16 Hedging Gain/(Loss) Accounting GRM +40% YoY -178% YoY 3.86 7.59 2014 2015 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16 +21% QoQ FO - DB 5.13 0.93 7.63 2.22 3.86 4.17 0.94 0.07 0.91 (1.9) (3.6) (8.1) (5.0) (6.5) (5.2) 5.98 6.23 (8.3) 5.45 5.40 0.98 4.77 4.41 4.16 Sales Volume (KBD) (0.04) (0.97) (1.25) (1.50) (2.47) (3.22) (4.36) (0.31) Others Fuel Oil Diesel Jet Naphtha+Ref. (0.03) 185 186 184 194 180 188 177 2014 2015 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16 8% 15% 15% 16% 16% 17% 17% 13% 13% 10% 9% 10% 2014 2015 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16 11% 17% Market GRM 4.41 5.45 5.98 5.40 4.16 6.23 4.77 48% 51% 49% 51% 50% 49% 46% GRM on CDU 5.61 7.13 7.97 7.27 5.11 8.25 6.10 14 15% 13% 14% 15% 14% 12% 13% GRM on CRS 2.77 2.95 2.58 2.69 3.16 3.39 3.80 15% 8% 9% 9% 10% 9% 9% 14 2014 2015 1Q/15 2Q/15 3Q/15 4Q/15 1Q/16
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