1Q2019 Opportunity Day Thursday, May 16, 2019 Disclaimer This - - PowerPoint PPT Presentation

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1Q2019 Opportunity Day Thursday, May 16, 2019 Disclaimer This - - PowerPoint PPT Presentation

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1Q2019 Opportunity Day Thursday, May 16, 2019 Disclaimer This presentation includes forward-looking statements that are subject to risks and uncertainties, including those pertaining to the anticipated benefits to be realized from the proposals

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1Q2019 Opportunity Day

Thursday, May 16, 2019

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Disclaimer

This presentation includes forward-looking statements that are subject to risks and uncertainties, including those pertaining to the anticipated benefits to be realized from the proposals described

  • herein. This presentation contains a number of forward-looking statements including, in particular,

statements about future events, future financial performance, plans, strategies, expectations, prospects, competitive environment, regulation and supply and demand. GGC has based these forward-looking statements on its views with respect to future events and financial performance. Actual financial performance of the entities described herein could differ materially from that projected in the forward-looking statements due to the inherent uncertainty of estimates, forecasts and projections, and financial performance may be better or worse than

  • anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking

statements. Forward-looking statements represent estimates and assumptions only as of the date that they were

  • made. The information contained in this presentation is subject to change without notice and GGC

does not undertake any duty to update the forward-looking statements, and the estimates and assumptions associated with them, except to the extent required by applicable laws and regulations.

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Agenda

Highlights Palm Oil Market Update Financial Performance GGC Going Forward

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Key Highlights

1Q2019 Highlights

+ Natural FA prices were being in competitive range to synthetic FA + FA Supply was tight due to plant shutdown in EU and China + Improve FA sales volume compares to 1Q2018

+ ME plant 2 has commenced the commercial

  • peration on April 5, 2019.

+ Mandate of B7 + Gov. has attempted to build up demand of B20

+ Extend price subsidies on B20 = B7-5 THB/litre (From Feb 19 to Jul 19) + Government targets to increase no. of B20 gas station to 1,000 stations

  • Consolidated EBITDA -32% YoY
  • ME EBITDA -98% YoY

+ FA EBITDA +192% YoY

  • High competition led to narrow margin
  • Glycerine price drop from glut supply
  • CPO prices continue downward trend due to high

inventory in domestic and international market

ME Business Unit: FA Business Unit: Financial Performance:

  • FA Plant planned shutdown during 1 - 11 January

2019 for changing catalyst

Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

Plant Operation :

  • CPKO prices continue downward trend due to

high inventory in domestic and international market

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20.34 16.94 16.04 19.57

1Q18 4Q18 1Q19 FY18 1Q18 4Q18 1Q19 FY18

5.14 5.22 4.87 5.19

1Q18 4Q18 1Q19 FY18

24.66 21.78 20.74 24.15

1Q18 4Q18 1Q19 FY18

1Q2019 Operation Highlights

ME (EPPO) : THB/Litre

METHYL ESTER (B100) BUSINESS UNIT

Biodiesel Mandate ME EPPO P2F : THB/Kg

GGC’s ME Operational Performance

B7 B7 B7 B7

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CPO (DIT) : THB/Kg

119% 112% 102% 113%

1Q18 4Q18 1Q19 FY18 102,754 97,431 (2) 94,703 (1) 374,922 1Q18 4Q18 1Q19 FY18

180 26 21 509

1Q18 4Q18 1Q19 FY18

Adjusted EBITDA (MB) Sales Volume (Tons)

THB/Kg 1Q18 4Q18 1Q19 FY18 ME EPPO 28.51 25.18 23.98 27.91

ME1 Plant Utilization Rate

Note: The company could only realize the total sales volume from ME plant 1 because ME plant 2 is under testing run for commercial operation in 4Q18 and 1Q19. (1) In 1Q19, Sales volume from ME plant 2 = 15,678 tons (2) In 4Q18, Sale volume from ME plant 2 = 7,109 tons Note: Utilization rate calculated base on nameplate capacity of ME1

Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

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419 535 553 471

1Q18 4Q18 1Q19 FY18

1,784 1,395 1,365 1,568

1Q18 4Q18 1Q19 FY18

1,138 717 677 914

1Q18 4Q18 1Q19 FY18

FATTY ALCOHOLS BUSINESS UNIT

CPKO (MPOB) : USD/Ton FA (ICIS) : USD/Ton

Natural Fatty Alcohols regained Competitiveness vs. Synthetic ones

FA Market P2F : USD/Ton

GGC’s FA Operational Performance

Plant Utilization Rate Crude Oil Price (WTI) : USD/BBL Ethylene Price (USGC) : USD/Ton

Synthetic FA (C1215) Price : USD/Ton Natural Mid Cut FA (C1214) Price : USD/Ton

1Q2019 Operation Highlights

63 59 55 65

1Q18 4Q18 1Q19 FY18

669 660 614 643

1Q18 4Q18 1Q19 FY18

2,381 1,764 1,565 2,039 2,160 1,562 1,502 1,742

1Q18 4Q18 1Q19 FY18

101% 129% 111% 115%

1Q18 4Q18 1Q19 FY18 24,235 33,442 24,798 114,784 1Q18 4Q18 1Q19 FY18

264 284 196 877

1Q18 4Q18 1Q19 FY18

Adjusted EBITDA (MB) Sales Volume (Tons)

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Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

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Agenda

Highlights Palm Oil Market Update Financial Performance GGC Going Forward

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Project Methyl Ester Plant 2 Refined Glycerin Plant 2 Biocomplex Phase 1 Capacity Methyl Ester 200 KTA Refined Glycerin 20 KTA Sugarcane : 2.4 mm TPA Ethanol : 186 mm LPA CAPEX 1,650 MB 326 MB 7,500 MB (GGC hold 50%) Project Progress Update COD Awarded EPC 2Q19 Site Preparation Loan Agreement Signed EPC Selection Scheduled COD 5 Apr 2019 2Q20 Early of 1Q21 COD as of Apr 5, 2019

Projects Timeline

Refined Glycerin Plant 2 20 KTA Methyl Ester Plant 2 200 KTA Biocomplex Phase 1

Sugarcane : 2.4 mm TPA Ethanol : 186 mm LPA

2018 End 2019 End 2020 End

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Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

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Agenda

Highlights Palm Oil Market Update Financial Performance GGC Going Forward

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2Q19 Highlights of Palm Oil & Oleochemicals Market

ME Chain ME Price & Spread FA Price & Spread FA Chain

ME:

  • ME demand in Q2/19 remains healthy due to supportive Biodiesel

policies from government;

  • Target to implement B10 as an optional fuel for diesel car in May’19
  • B20 demand is accelerating with increase no. of B20 stations
  • Government also plans to extend B20 subsidiary program at 5 THB/L

from end of May’19 to Jul’19

  • Gap of ME (B100) vs B7 price encourages some users to use ME

(B100) directly

CPO:

  • Local CPO price is slightly firmer amid healthy demand from EGAT and

Biodiesel producers

  • Local CPO stock Mar’19: 434,244 tons Apr’19: 383,957 tons

FA:

  • FA demand is still healthy amid tight supply
  • Natural FA price still has advantage over Synthetic FA
  • Some Chinese producers were forced to shutdown due to strict Safety

and Environmental

CPKO:

  • CPKO price is moving sideway due to ending of palm harvesting season

in Malaysia and Indonesia

  • However, CPKO price is still pressured by high inventory level

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Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

5.2 5.0 4.8 4.9 5.1 5.1 5.3 5.2 4.9 5.6 5.0 5.2 39.5 34.4 30.5 28.6 28.5 28.9 29.0 25.2 24.0 23.7 33.3 27.9 30.8 25.8 22.4 20.5 20.3 20.8 20.2 16.9 16.0 15.3 24.9 19.6 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 Apr-19 FY17 FY18

THB/KG Spread ME CPO 424 584 433 488 419 468 463 535 553 580 483 471 2,243 1,783 1,820 2,054 1,784 1,570 1,521 1,395 1,365 1,263 1,975 1,568 1,516 999 1,156 1,304 1,138 919 882 717 677 570 1,244 914 500 1,000 1,500 2,000 2,500

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 Apr-19 FY17 FY18 USD/T

Spread FA CPKO

Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

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Opportunity: Potential to increase Biodiesel blending rate

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*GGC expected B20 from diesel passenger car maximum consumption 157 ML/M -> B100 30.2 ML/M ( additional from B7 19.6 ML/M)

8.8 16.7 25.7 40.0 50.0 55.0 60.5 66.6 73.2 80.5 81.3 82.1 0.00 15.00 30.00 45.00 60.00 75.00 90.00

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

ML/M

Forecast

2019 Forecast B20 Demand

MOEN reported B ✓ 20 consumption in Apr’19: ̴40 ML (increased by 55% from previous month) As of Mar ✓ ’19, there are 207 stations(B20) nationwide and expanding up to 1,000 stations by the end of this year Government also plans to prolong B ✓ 20 subsidiary program at 5 THB/L from end of May’19  Jul’19

Palm Oil Market Updates Financial Performance GGC Going Forward Highlights Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

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Opportunity: Potential to increase Biodiesel blending rate

B10 Development Timeline

Next Step B10 Mandate

JAMA recommends B100 and B10 specification;

B100, MG < 0.4% wt. B10 Water < 200 ppm

97 models of accepted B20

DOEB announced B10 and B100 specification as JAMA suggestion

MOF announced the Excise Tax for additional Biodiesel Blending Ratio 15th May 2019 22nd Apr 2019 15th May 2019 11st Mar 2019

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Palm Oil Market Updates Financial Performance GGC Going Forward Highlights Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

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Agenda

Highlights Palm Oil Market Update Financial Performance GGC Going Forward

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Consolidated Financial Performance

Sales Revenue (MB)

EBITDA & Adjusted EBITDA* (MB) / Adjusted EBITDA Margin* (%)

1Q19 1Q18 4Q18

ME EBITDA ME Adjusted EBITDA FA EBITDA FA Adjusted EBITDA Consolidated Adjusted EBITDA Margin

Net Profit (MB) & Net Profit Margin (%)

FY18

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2,774 2,079 1,714 9,913 1,857 1,575 1,102 6,312

4,631 3,654 2,816 16,225

1Q18 4Q18 1Q19 FY18

ME Business Unit FA Business Unit

64 443 (1) 22

  • 1,161 (2)

1Q18 4Q18 1Q19 FY18

1.4% 12.1% 0.8% 163 180 1 26 3 21 429 509 48 264 285 284 140 196 494 877

211 444 286 310 143 217 923 1,386 9.6% 8.5% 7.7% 8.5%

  • 7.2%

Note: (1) In 4Q18, net profit was recorded 443 MB which was included tax income from deferred tax assets amounting to 272 MB. (2) In FY18, net profit was recorded -1,161 MB which was included tax income from deferred tax assets amounting to 356 MB and expenses from raw materials derogation amounting to 2,004 MB.

Palm Oil Market Updates Financial Performance GGC Going Forward Highlights Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

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Financial Position

Statements of Financial Position

Cash and Cash Equivalent Account Receivable, Inventory, and other Current Assets PP&E Non-current Assets Other Liabilities Interest Bearing Debt Shareholders’ Equities December 31, 2018 Baht 13,084million

Key Financial Ratios Repayment Plan Cash Flows

Million Baht Million Baht Million Baht

528 935 (2,292) 2,575 1,745

*

*Cash from IPO was spent in ME2 project of 1,150 MB and WC 308 MB Ending Cash had not included short-term investment of 1,350 MB March 31, 2019 Baht 12,799 million

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338 441 567 765

2019 2020 2021 2022

2,387 +252

  • 90
  • 17

2,532

Beginning Cash Operating Cash Flows CAPEX & Investment Financing Ending Cash 7,923 11,073 9,708 9,730 2,689 2,400 2,120 2,121 FY16 FY17 FY18 1Q19

0.3 0.2 0.2 0.2 1.8 2.1 2.3 2.2

Palm Oil Market Updates Financial Performance GGC Going Forward Highlights Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

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Performance 1Q19 vs. 1Q18

Net Profit : Million Baht

Operating Profits In 1Q19, operating profits was lower than 1Q18, mainly from these factors;

  • The lower profitability of ME due to aggressive market competition and decreasing of sales volume
  • A decrease in refined glycerine price regarding to supply glut

Stock Gain/(Loss) & NRV In 1Q19, the company recognized stock loss & NRV of 74 MB due to downward trend in CPO & CPKO prices. However, it was improved from 1Q18 by 159 MB due to improving inventory management. Gain/(Loss) from FX In 1Q19, the company recorded loss of 3 MB against loss of 27 MB in 1Q18 due to the impact from THB appreciation, in which THB was appreciated by 1.7% in 1Q19 and in 1Q18 was appreciated by 3.7%

Palm Oil Market Updates Financial Performance GGC Going Forward Highlights Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

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Performance 1Q19 vs. 4Q18

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Operating Profits In 1Q19, operating profits was lower than 4Q18, attributed to the lower EBITDA of fatty alcohols due to lower sales volume from FA plant planned shutdown for changing catalyst and low seasonal demand in this quarter. Stock Gain/(Loss) & NRV In 1Q19, the company recognized stock loss & NRV of 74 MB while recorded stock & NRV of 24 MB in 4Q18, primarily due to downward trend in CPO and CPKO prices.

Net Profit : Million Baht

  • 50
  • 2
  • 4

Palm Oil Market Updates Financial Performance GGC Going Forward Highlights Palm Oil Market Updates Financial Performance GGC Going Forward Highlights

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T H A N K Y O U

Global Green Chemicals Public Company Limited

555/1 , Energy Complex, Building A, 4th Floor, Vibhavadi Rangsit Road, Chatuchak, Chatuchak, Bangkok 10900, Thailand Tel: +66(0) 2 558 7306 Tel: +66(0) 2 558 7345 Fax: +66(0) 2 558 7301 www.ggcplc.com

For further information or enquiries, please contact our Investor Relations Team : ir@ggcplc.com

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Appendix

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Palm Oil & Oleochemicals Market

14.76

CPKO CPO

2016 2017 2018

Glycerine

29.63 30.10 29.02 32.26 33.93 33.50 37.49 34.00 31.05 30.00 29.63 30.80 31.40 31.97 28.97 26.91 26.77 23.84 23.05 22.13 22.11 21.59 20.73 19.12 19.10 21.28 20.37 18.97 20.16 23.2 21.59 20.09 19.03 17.89 16.22 16.72 17.04 16.32 15.00 20.00 25.00 30.00 35.00 40.00 45.00 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 CPO_DIT(B/kg) 924 1,002 1,156 1,286 1,205 1,304 1,276 1,438 1,481 1,375 1,515 1,625 1,776 1,584 1,188 950 1,065 982 989 1,126 1,352 1,332 1,338 1,243 1,256 1148 1009 985 916 854 871 903 871 777 668 706 748.93 679.38 601.74

  • 500

1,000 1,500 2,000 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 CPKO(USD/Ton) 200 400 600 800 1000 1200 Spread(USD/Ton) RGL(USD/Ton) CGL(USD/Ton)

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Key Performance By Business Unit

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METHYL ESTER (B100) BUSINESS UNIT FATTY ALCOHOLS BUSINESS UNIT

(1) Nameplate Capacity 300,000 tons per year from ME1 (2) In 1Q2019, GGC had sales volume form ME2 of 15,678 tons (3) In 4Q2018, GGC had sales volume form ME2 of 7,109 tons (4) Conversion ratio: 0.865 tons = 1,000 litres (5) Adjusted EBITDA refers to EBITDA excluding impact of Stock Gain/(Loss) and NRV (1) Adjusted EBITDA refers to EBITDA excluding impact of Stock Gain/(Loss) and NRV

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Consolidated Income Statement

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MB % MB % MB % MB % MB % Sale Revenue 2,816 100 4,631 100 (1,815) (39) 3,654 100 (838) (23) Feedstock (1,975) (70) (3,522) (76) 1,547 (44) (2,575) (70) 600 (23) Net Realizable Value (NRV) (7) (0) 2 0 (9) (450) (4) 0 (3) 75 Product to Feed Margin 834 30 1,111 24 (277) (25) 1,075 29 (241) (22) Variable Costs (403) (14) (495) (11) 92 (19) (484) (13) 81 (17) Fixed Costs (133) (5) (126) (3) (7) 6 (163) (4) 30 (18) Stock Gain/(Loss) (67) (2) (235) (5) 168 (71) (20) (1) (47) 235 SG&A (110) (4) (72) (2) (38) 53 (140) (4) 30 (21) Other Income 22 1 28 1 (6) (21) 18 0 4 22 EBITDA 143 5 211 5 (68) (32) 286 8 (143) (50) Depreciation and Amortization (111) (4) (139) (3) 28 (20) (125) (3) 14 (11) EBIT 32 1 72 2 (40) (56) 161 4 (129) (80) Net Financial Costs (4) (0) (5) (0) 1 (20) (5) (0) 1 (20) FX Gain/Loss(1) (3) (0) (27) (1) 24 (89) (1) (0) (2) 200 Share of Profit/(Loss) from investment 1 0 20 0 (19) (95) 9 0 (8) (89) Income Tax Expenses (4) (0) 4 0 (8) (200) 7 0 (11) (157) Net Profit bef extra items 22 1 64 1 (42) (66) 171 5 (149) (87) Extra item net of tax(2)

  • n.a. - n.a. - n.a.

272 7 (272) (100) Net Profit after extra items 22 1 64 1 (42) (66) 443 12 (421) (95) QoQ 1Q2019 1Q2018 YoY 4Q2018

Notes : (1) Including Gain/(Loss) from FX and Derivatives (2) Extra item was tax income from deferred tax assets amounting to THB 272 million.