Analyst Conference Q2/18 Wednesday, July 25, 2018 P.2 Agenda I. - - PowerPoint PPT Presentation

Analyst Conference Q2/18

Wednesday, July 25, 2018

Agenda

P.2

• I. Consolidated Results
• Q2/18 Consolidated Results
• H1/18 Summary
• Financial Updates

II. Cement - Building Materials Business

• III. Chemicals Business
• IV. Packaging Business
• V. Summary

Q2/18 Revenue from Sales

Revenue increased +11% y-o-y from higher volume and prices from all businesses, while the 2% q-o-q gain was led by increased chemicals sales volume. P.3

+11% y-o-y +2% q-o-q

116,268 108,825 112,428 113,400 118,250 120,447

30,000 60,000 90,000 120,000 150,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 MB

Q2/18 EBITDA

EBITDA decreased -4% y-o-y from the drop in dividends from the associates, but gained +19% q-o-q, following seasonal dividends from associates. P.4

Note: EBITDA = EBITDA from Operations + Dividend from Associates Dividend from Associates

EBITDA

EBITDA from Operations

25,565 20,062 19,737 20,272 21,014 20,521 2,543 7,502 78 6,321 1,289 5,925 5,000 10,000 15,000 20,000 25,000 30,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 MB

28,108 27,564 19,815 26,593 22,303

+2% y-o-y

• 2% q-o-q
• 4% y-o-y

+19% q-o-q

26,446

Q2/18 Equity Income

Chemicals associates were the primary factor to the both the +13% q-o-q gain and -4% y-o-y drop in equity income. P.5

• 4% y-o-y

+13% q-o-q

881 956 731 818 1,030 1,020 4,677 3,438 3,523 3,188 2,704 3,183 1,000 2,000 3,000 4,000 5,000 6,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Chemicals Non-Chemicals MB

5,558 4,394 4,254 4,006 3,734 4,203

Q2/18 Profit for the Period

Earnings of 12,402 MB was solid q-o-q, but dropped -6% y-o-y on higher naphtha costs in the chemicals business and the stronger Thai Baht FX. P.6

Note: *SCG Chemicals (Sub + Asso.)

Key Non-recurring 2,830 (1,810) 1,210 870 220 380

1) Inventory Gain (Loss)* 930 (1,860) 900 140 220 380 2) Sale of Investment and assets 1,900 50 310 730

5,000 10,000 15,000 20,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 MB

17,386 13,252 11,836 12,567 12,406 12,402

• 6% y-o-y

flat q-o-q

Agenda

P.7

• I. Consolidated Results
• Q2/18 Consolidated Results
• H1/18 Summary
• Financial Updates

II. Cement - Building Materials Business

• III. Chemicals Business
• IV. Packaging Business
• V. Summary

H1/18 Financials

Sales growths of +6%, but EBITDA dropped -12% y-o-y, and earnings declined -19% y-o-y

• n lower performance from the chemicals business.

P.8

50,000 100,000 150,000 200,000 250,000

H1/17 H1/18

MB

225,093 238,697

Revenue from Sales

45,627 41,535 10,045 7,214 20,000 40,000 60,000

H1/17 H1/18

Dividend EBITDA from Operations MB

EBITDA 55,672 48,749 EBITDA 20% 17% Margin:

EBITDA

20,686 16,871 9,952 7,937 10,000 20,000 30,000 40,000

H1/17 H1/18

MB

EPS: 25.5 20.7

Profit for the Period

24,808 30,638

Sub. Eq Inc. Eq Inc. Sub.

H1/18 Segmented Revenue from Sales

Chemicals and non-Chemicals sales were 46% and 54%, respectively. P.9

H1/18 238,697 MB

Cement- Building Materials 36% Packaging 18% Chemicals 46%

87,481 103,856 39,275 91,119 109,920 43,773 20,000 40,000 60,000 80,000 100,000 120,000 MB

H1/17 H1/18 Cement - Building Materials H1/17 H1/18 Chemicals H1/17 H1/18 Packaging

H1/17 225,093 MB

Cement- Building Materials 36% Packaging 18% Chemicals 46%

H1/18 Segmented Profit for the Period

Chemicals profits dropped to 65% of earnings, compared to 72% in H1/17. P.10

3,843 22,250 2,682 1,986 4,161 16,266 3,110 1,362 5,000 10,000 15,000 20,000 25,000 MB

H1/18 24,808 MB

Chemicals Equity Income 24% Chemicals Subsidiaries 41% Cement- Building Materials 17% Packaging 12% Sub. 14,135 Sub. 10,379 Eq Inc. 5,887 Eq Inc. 8,115 Others 6% H1/17 H1/18 Cement - Building Materials H1/17 H1/18 Chemicals H1/17 H1/18 Packaging H1/17 H1/18 Other

H1/17 30,638 MB

Chemicals Equity Income 26% Chemicals Subsidiaries 46% Cement- Building Materials 13% Packaging 9% Others 6%

(65%) (72%)

H1/18 Segments: Export Sales and ASEAN Operations

ASEAN exports and operations were 24% of total sales. P.11

59% 58% 24% 24% 17% 18% H1/17 H1/18

Export as % of Sales 27% 27%

Sales Segments (by markets)

Thailand (domestic)

ASEAN (ex-Thailand)

Others

Export Segments (by markets)

238,697 MB 225,093 MB

ASEAN 37% ASEAN 37%

China/HK 24% China/HK 24%

• S. Asia

14%

• S. Asia

13%

• N. Asia

8%

• N. Asia

11%

Others 17% Others 15%

H1/17 H1/18

60,689 MB 64,993 MB

H1/18 HVA’s Revenue from Sales

P.12

Business 2013 2014 2015 2016 2017 H1/18 Cement-Building Materials 41% 42% 41% 41% 43% 39% Chemicals 27% 27% 31% 31% 30% 31%

Chemicals (Includes associates)

50% 50% 53% 54% 54% 52%

Packaging 38% 39% 39% 43% 47% 49% 50,000 100,000 150,000 200,000 2004 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 H1/18

HVA as a % of 4% 17% 19% 25% 29% 32% 34% 35% 35% 37% 38% 39% 38% Revenue from Sales

MB

149,924 136,762 117,992 85,768 59,461 54,865 38,837 7,783 169,071 161,851 (+6 y-o-y) 175,541 160,910 91,101

H1/17 86,291

Agenda

P.13

• I. Consolidated Results
• Q2/18 Consolidated Results
• H1/18 Summary
• Financial Updates

II. Cement - Building Materials Business

• III. Chemicals Business
• IV. Packaging Business
• V. Summary

H1/18 EBITDA on Assets, and EBITDA Margin

P.14

Note: EBITDA on Assets = EBITDA / Consolidated Assets EBITDA margin = EBITDA from Operations / Consolidated Sales

Percent (%) EBITDA Margin (%):

16 14 18 14 11 10 13 13 18 21 19 17

EBITDA on Assets

20 14 15 13 12 12 14 14 16 18 18 15 5 10 15 20 25 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 H1/18

H1/18 Net Debt

Leverage rose slightly to 1.5 times (x). P.15

99.9 120.5 122.0 83.6 112.1 137.6 157.8 164.4 162.5 146.9 145.0 137.6 2.0 3.1 2.6 1.8 2.4 3.0 2.6 2.5 2.0 1.5 1.4 1.5

0.0 2.0 4.0 6.0 8.0 10.0 50 100 150 200

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 H1/18

Billion Baht

(Net Debt)

Times (x)

(Leverage)

Net Debt to Equity = 0.4x Net Debt on EBITDA

H1/18 CAPEX & Investments

Amounted to 17,866 MB in H1/18, as investments accounted for 43% of the total. P.16

27.2 42.4 34.5 18.4 32.0 47.0 50.0 45.0 45.2 34.8 46.1 17.9

0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 H1/18

Billion Baht

50% 23% 23% 4% Others Cement- Building Materials Packaging Chemicals

• CAPEX includes debottlenecking, expansion projects, and major turnaround.
• Investments are acquisitions and purchase of shares (EV basis).

43% 32% 12% 2% 11%

Efficiency Projects Others Greenfield & Expansion Maintenance

H1/18

SBU: Types:

Investment

H1/18 Interest and Finance Costs

Amounted to a total of 3,416 MB, while interest cost was 3.3%, with 98% at fixed rate. P.17

1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 H1/18

MB

5,273 6,089 5,649 4,670 6,048 6,321 8,193 7,266 9,076 7,573 7,112

3,416

Financial Highlights & Outlook

P.18

• H1/18 dividend of 8.5 Bt/sh (10,200 MB), and is payable on Aug 22/18 (XD date is

Aug 8/18).

• FY2018 CAPEX & Investments of approx. 40,000-50,000 MB, with forecast of
• approx. 60,000 MB in FY2019.

Agenda

P.19

• I. Consolidated Results
• Q2/18 Consolidated Results
• H1/18 Summary
• Financial Updates

II. Cement - Building Materials Business

• III. Chemicals Business
• IV. Packaging Business
• V. Summary

Q2/18 Market situation

P.20

ASEAN (ex-Thailand) markets in Q2/18:

• The demand of grey cement in ASEAN was positive. (details in page 21)

Thailand market in Q2/18:

• Grey cement demand increased +2% y-o-y in Q2/18 from the continuous growth of

megaprojects.

• Ready-mixed concrete (RMC) demand increased +6% y-o-y in Q2/18 while the average

prices remained in the range of 1,600 – 1,650 Baht per cubic meter.

• Housing products demand (roof ceiling & wall) decreased -2% y-o-y in Q2/18.
• Ceramic tiles demand dropped -6% y-o-y in Q2/18.

ASEAN market insight

P.21

Grey Cement Demand Growth ( y-o-y )

Q1/17 Q2/17 Q3/17 Q4/17 2017 Q1/18 Q2/18 H1/18

Cambodia

+5% +5% +7% +16% +8% +14% +15% +14%

Indonesia

+1%

• 3%

+22% +10% +8% +6% +1% +4%

Myanmar

0% +1%

• 6%
• 6%
• 3%

+1%

• 2%

0%

Vietnam

+4%

• 4%
• 6%
• 2%
• 1%

+5% +1%* +3%*

Thailand

• 7%
• 7%
• 2%
• 3%
• 5%

0% +2% +1% Note: Indonesia’s grey cement demand is based on the data from Indonesian cement association (ASI).

* Vietnam’s grey cement demand in Q2/18 included only Apr-May, H1/18 included only the first five months of 2018.

Revenue from Sales

Sales in Q2/18 increased +5% y-o-y from Thai market and the expansion of ASEAN

• peration and Non-ASEAN market.

P.22

Others ASEAN Thailand +5% y-o-y

• 4% q-o-q

Note: Thailand : Revenue from sales in Thailand market

ASEAN : Revenue from sales in ASEAN market (ex Thailand) Others : Revenue from sales in Non-ASEAN market

64% 63% 29% 29% 7% 8% H1/17 H1/18 66% 62% 64% 63% 65% 62% 27% 31% 30% 31% 28% 30% 7% 7% 6% 6% 7% 8%

10,000 20,000 30,000 40,000 50,000

Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18

MB 42,657 44,402 44,824 43,372 46,461 44,658 87,481 91,119

EBITDA and Profit for the Period

EBITDA increased +1% y-o-y in Q2/18 from Thai market, profitability increased +6% y-o-y. P.23

6,042 5,336 5,385 4,687 6,458 5,367 2,261 1,582 1,570 1,044 2,484 1,677 2,000 4,000 6,000 8,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 EBITDA Margin * Total 13% 12% 12% 11% 13% 12% ASEAN and Others 13% 14% 12% 11% 11% 12% Thailand only 12% 12% 12% 11% 14% 12%

Thai Structural Prod.

18% 16% 17% 16% 22% 20%

EBITDA Portion ASEAN and Others 35% 41% 37% 37% 29% 38% MB EBITDA Profit for the period Note: * EBITDA margin = EBITDA from Operations, excludes divided from associates.

+1% y-o-y

• 17% q-o-q

+6% y-o-y

• 32% q-o-q

v

3,843 4,161 H1/17 H1/18 Profit H1/18 H1/17 H1/18 EBITDA H1/18 11,378 11,825

v

ASEAN and others sales segmentation

Q2/18 sales in ASEAN and others increased +6% y-o-y, attributed to Exports, ASEAN

• peration, and Non-ASEAN markets.

P.24

Note: ASEAN = ASEAN Operations, exports from Thailand to ASEAN, and Trading business in ASEAN market

Others = Exports from Thailand to Non-ASEAN, and Trading business in Non-ASEAN market

+6% y-o-y +5% q-o-q

Others 20% ASEAN Operations 56% Export to ASEAN 24%

Others Exports to ASEAN ASEAN Operations

57% 59% 61% 61% 56% 56% 24% 24% 22% 23% 24% 23% 19% 17% 17% 16% 20% 21%

3,000 6,000 9,000 12,000 15,000 18,000

Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18

MB 15,933 16,014 15,817 15,243 16,228

33,277 MB (+6% y-o-y) ASEAN and Others Sales (H1/18)

17,049

Grey cement exports

Export volume from the Thai operations remain unchanged at 1.2 MT q-o-q but slightly decreased y-o-y in Q2/18, while the average prices increased for y-o-y as the world price clinker went up.

P.25

0.5 0.9 0.5 0.4 0.6 0.8 0.5 0.4 0.4 0.4 0.6 0.4

47 40 44 46 47 45 10 20 30 40 50 60 70 0.0 1.0 2.0 3.0 4.0 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18

Sales volume and Average prices (FOB)

$/Ton Note: FOB price does not include handling charges and discount. THB/USD 35.1 34.3 33.4 32.9 31.5 31.9

1.3 0.9 0.8 1.0

MT

Clinker Export Grey Cement Export Average FOB Prices

1.2 1.2

Thailand sales segmentation

Q2/18 sales in Thailand improved +4% y-o-y, from bulk sales volume of cement and trading of non-SCG products. P.26

44% 44% 44% 46% 45% 45% 14% 14% 13% 12% 15% 15% 13% 13% 13% 11% 11% 11% 29% 29% 30% 31% 29% 29% 5,000 10,000 15,000 20,000 25,000 30,000 35,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 MB 29,581 26,643 28,586

v

+4% y-o-y

• 9% q-o-q

Ceramics Building Products Cement and Construction Solution Distribution and Retail 27,438 30,233 Note: Cement and Construction Solution: Grey cement, RMC and Others (mortar and white cement).

Building Products: Roofing products, Board & Wood sub and Lightweight concrete blocks. Ceramics: includes Sanitary ware and Fittings. Distribution and Retail: including Home improvement.

57,842 MB (+3% y-o-y) Thailand Sales (H1/18)

45% 15% 11% 29%

27,609

Thailand grey cement segment

Grey cement demand increased +2% y-o-y in Q2/18. P.27

Q1/17 Q2/17 Q3/17 Q4/17

2017

Q1/18

Q2/18 H1/18 Total Market* (100%)

• 7%
• 7%
• 2%
• 3%
• 5%

0% +2% +1% Commercial

(Approximately 15%)

• 7%
• 9%
• 3%
• 6%
• 6%
• 3%

0%

• 2%

Gov’t

(Approximately 35%)

• 4%
• 3%

+6%

+1% 0% +6% +8% +7% Residential

(Approximately 50%)

• 9%
• 9%
• 8%
• 5%
• 8%
• 3%
• 1%
• 2%

Note: * Estimated volume market distribution

% Growth ( y-o-y )

500 1,000 1,500 2,000 2,500

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Thailand grey cement price

The average price in Q2/18 was improved y-o-y in the range of 1,700-1,750 Baht/ton. P.28 2016 2017 2018

Baht/Ton

Average Domestic Price of Grey Cement (Net ex-factory)

Bulk cement portion in Q2/18 was in the range of 65 - 70%

Ceramic Tiles

Sales volume slightly dropped y-o-y due to intense competition in domestic; while regional market remains in growth mode. P.29

Average Price Sales volume

Sales volume & prices for all ASEAN subsidiaries

45 47 46 44 46 46

20 40 60 80 100 120 140 160 20 40 60 80 100

Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18

Baht/sqm. M sqm.

NOTE: sales volume includes the elimination of intercompany sales

• 2% y-o-y
• 1% q-o-q

Volume change

Outlook

P.30

Outlook:

• ASEAN (ex-Thailand) demand for grey cement and building materials products are

forecasted to see growths.

• Thai grey cement demand in FY2018 are forecasted to be slightly positive, which

emphasis on the government’s infrastructure projects and improving in the household income.

• Demand for housing products and ceramic tiles in Thailand are projected to remain soft

for FY2018.

Investment Highlights:

• “COTTO” or ”SCG Ceramics PCL” expects to trade on Aug 3rd, 2018.
• SCG’s 49% logistics JV with JUSDA: Formation of an integrated logistics and supply

chain management company in southern China (Guangxi province) with linkages to

• ASEAN. JUSDA is a service platform of the supply chain management of FOXCONN.
• SCG’s 29% investment in Indonesian retail trade: PT Catur Sentosa Adiprana Tbk is

the operator of the modern retailer (“Mitra 10”) and distributor of home products. This transaction is expected to be completed in Q3/18.

Agenda

P.31

• I. Consolidated Results
• Q2/18 Consolidated Results
• H1/18 Summary
• Financial Updates

II. Cement - Building Materials Business

• III. Chemicals Business
• IV. Packaging Business
• V. Summary

Q2/18 Market Situation

P.32

Q2/18 Q-o-Q Change Notes Crude (Brent) $75/bbl +$8/bbl (+12%) Brent price surged on concern of tightening supply after the U.S. re-imposed sanction on Iran. Naphtha $641/ton +$60/ton (+10%) Naphtha price rose following crude price although upside was limited from lower demand of LPG replacement at crackers. Ethylene $1,222/ton

• $22/ton (-2%) Ethylene price dropped from influx of European cargoes caused by their downstream plant

shutdowns. Propylene $1,003/ton +$16/ton (+2%) Propylene price in-line with increase of naphtha but capped by resume of supply from on- purpose and refineries turnaround. HDPE $1,384/ton +$6/ton (0%) HDPE priced unchanged. PP $1,299/ton +$28/ton (+2%) PP price stronger from tight polypropylene in China. EDC $300/ton +$98/ton (48%) EDC price rose sharply from strong demand of non-vinyl Chinese producers as concern of U.S.-China trade tension heightened. PVC $925/ton +$20/ton (2%) Increase in PVC price supported by limited supply from planned maintenance in North Asia and ongoing environmental inspection in China. PVC-EDC/C2 $398/ton

• $55/ton (-12%) Gap narrowed with the sharp rise in EDC cost, which is attributed to strong demand from

China; while PVC price gained slightly owing to tight supply from North Asian producers. MMA- Naphtha $2,012/ton +$99/ton (+5%) Gap gain, following tight supply in all regions. BD-Naphtha $922/ton +$153/ton (+20%) BD spread rose sharply as supply was tight from maintenance and firm import demand from the U.S. PTA-PX $152/ton +$37/ton (+32%) Spread widened from higher PTA price caused by plant shutdowns in China.

HDPE-Naphtha Price Gap

HDPE prices remain resilient q-o-q despite steep increase in naphtha cost. Y-o-Y increase is $195 per ton for naphtha. P.33

Note: Prices refer to SEA regional prices

300 600 900 1,200 1,500 1,800

Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 To date

HDPE- Naphtha 759 743 749 684 677 687 670 656 798 743 717 Spread ($/ton) HDPE-C2 91 54 82 156 86 143 48 31 135 162 88 C2-Naphtha 668 689 668 528 591 544 622 625 663 581 629

$/ton HDPE-N Naphtha Ethylene HDPE

673 734

Q2/18 HDPE-N +8% y-o-y

• 7% q-o-q

771

PP-Naphtha Price Gap

PP-N gap maintained, while regional plant turnarounds resulted in tight supply to support the PP-C3 spread. P.34

300 600 900 1,200 1,500 1,800

Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 To date

PP-Naphtha 589 680 704 636 661 667 682 625 690 658 649 Spread ($/ton) PP-C3 285 372 365 364 226 372 359 367 284 296 327 C3-Naphtha 305 308 339 272 435 295 323 258 406 362 322

$/ton

659 652

Note: Prices refer to SEA regional prices

PP-N Naphtha Propylene PP Q2/18 PP-N

• 1% y-o-y
• 5% q-o-q

674

Benzene & Toluene

BZ-N: Gap plunged from new capacity addition in the Middle East and China. TL-N: Gap decreased following lacklustre demand. P.35

Note: Benzene price refer to SEA regional price, toluene price refer to NEA regional price

300 600 900 1,200 1,500 $/ton Naphtha Toluene Benzene

Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 To date

BZ-Naphtha 218 211 241 267 428 317 289 260 304 181 161 TL-Naphtha 231 184 175 190 200 170 160 109 137 117 96 BZ-Spread TL-Spread

Q2/18 Toluene-N

• 31% y-o-y
• 15% q-o-q

195 160 234 324

Q2/18 Benzene-N

• 43% y-o-y
• 40% q-o-q

242 196

Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 To date

PVC- EDC/C2

302 331 354 494 421 374 429 436 453 398 365

Spread ($/ton)

PVC

PVC-EDC/C2 gap narrowed with the sharp rise in EDC spot price, which is attributed to strong demand from China; while PVC prices gained slightly owing to tight supply from north Asian producers.

P.36

415 370

Note: Prices refer to FE regional prices

$/ton PVC EDC PVC-EDC/C2 Ethylene 300 600 900 1,200 1,500 1,800

426

Q2/18 PVC-EDC/C2 + 6% y-o-y

• 12% q-o-q

Price Gaps of Associates

MMA-N: Gap gain, following tight supply in all regions. PTA-PX: Spread widened from higher PTA prices, attributed to Chinese shutdowns. BD-N: BD spread rose sharply, due to tight supply on maintenance issues and firm import demand from the U.S.

P.37

50 100 150 200 250 300 500 1,000 1,500 2,000 2,500

Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 to date MMA-N 955 1,055 1,323 1,398 1,465 1,754 1,871 1,882 1,913 2,012 2.097 PTA-PX 66 73 67 66 68 80 88 93 115 152 173 BD-N 546 602 702 1,158 2,127 669 742 522 769 922 998

Note: MMA price refers to SEA regional prices, PTA and BD prices refer to Asian regional prices

MMA-Naphtha $/ton, BD-Naphtha $/ton PTA-PX $/ton

MMA-Naphtha BD-Naphtha PTA-PX

516,000 531,000 401,000 411,000

917,000 942,000

H1/17 H1/18 256,000 260,000 270,000 253,000 255,000 276,000 201,000 200,000 217,000 195,000 196,000 215,000 457,000 460,000 487,000 447,000 451,000 491,000 200,000 400,000 600,000 800,000 1,000,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Ton PP PE

Polyolefin Sales Volume

Strong HDPE sales volume, together with widening downstream spread allowed for 9% increased q-o-q. P.38

+ 7% y-o-y + 9% q-o-q

187,000 189,000 221,000 202,000 208,000 205,000 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 ASEAN operations Domestic operation

PVC Sales Volume

Sales volume decrease -1% q-o-q, due to softer seasonal demand in Thailand and Indonesia, while sales in Vietnam remained healthy. P.39

Note: *ASEAN Operations = Sales volume from PVC operations in Vietnam and Indonesia

Ton

376,000 413,000

H1/17 H1/18 66% 34% 35% 65%

+ 8% y-o-y

• 1% q-o-q

` `

33% 67% 34% 34% 34% 34% 37% 66% 66% 66% 66% 63%

Revenue from Sales

Q2/18 revenue increased 4,186 MB or +8% q-o-q to 57,053 MB mainly from higher sales volume and prices. P.40

56% 53% 52% 53% 56% 51% 16% 16% 17% 16% 16% 19% 28% 31% 31% 31% 28% 30% 20,000 40,000 60,000 80,000 100,000 120,000 140,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Others ASEAN (ex-Thailand) Domestic (Thailand) 55% 53% 16% 17% 29% 30% H1/17 H1/18

MB

+15% y-o-y +8% q-o-q 54,271 49,585 50,590 51,834 52,867

103,856 109,920

57,053

EBITDA

EBITDA in Q2/18 rose q-o-q owing to seasonal dividend payout from associates. Y-o-Y performance of subsidiaries remained resilient. P.41

25,990 21,509 8,332 5,739 H1/17 H1/18 15,662 10,328 11,721 11,460 11,002 10,507 1,142 7,190 64 6,089 80 5,659 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Dividend EBITDA from Operations

Note: *EBITDA margin excluded sale of investment.

EBITDA 26%* 21% 23%* 21%* 21% 18% 23%* 20% Margin MB

16,804

• 8% y-o-y

+ 46% q-o-q 17,518 11,785 17,549 11,082

27,248 34,322

16,166

Profit for the Period

Q2/18 earnings stable q-o-q, but dropped -10% y-o-y on lower subsidiaries performance from Baht appreciation. P.42

14,136 10,379 8,115 5,887 H1/17 H1/18 8,501 5,635 6,062 6,249 5,431 4,948 4,677 3,438 3,523 3,188 2,704 3,183 5,000 10,000 15,000 20,000 25,000 30,000 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Equity Income Subsidiaries

NCI (3,700) (2,600) (2,700) (2,400) (2,500) (2,500) (6,300) (5,000) (Non controlling interest) Inventory 930 (1,860) 900 140 220 380 (930) 600 Gain (Loss)* Sale of investment and asset 1,430 - 310 650

• 1,430
• Note: *Sub/Asso: 61% / 39%

MB

9,073 9,585

• 10% y-o-y

flat q-o-q 9,437 8,135 13,178

22,251 16,266

8,131

Outlook

P.43

• Crude – Expected lower prices on output recovery from OPEC and Russia, together with

decreased demand from seasonal refinery turnarounds.

• Naphtha – Forecasted prices to drop, following crude price trends.
• Polyolefin – HDPE and PP prices are supported by demand, in preparation for agricultural

and festive seasons. However, there is growing uncertainty, following developments of the U.S.-China trade war.

• PVC – Prices are projected to increase, following the upcoming construction season and

reduced Chinese exports from stringent environmental inspection.

Investment Highlights:

• Long Son Petrochemicals Complex in Vietnam (LSP): Approximately 94% of the total

EPC costs have been signed. Key contracts include Olefins Plant, HDPE Plant, LLDPE Plant, PP Plant, Ports and Central Utility Plant.

• MOC Cracker Debottlenecking in Thailand (MOC-D): MOC’s 15,500 MB debottleneck

project will increase its olefins capacity by 20% to 2.05 million tons, and is expected to be completed in Q2 of 2021.

Agenda

P.44

• I. Consolidated Results
• Q2/18 Consolidated Results
• H1/18 Summary
• Financial Updates

II. Cement - Building Materials Business

• III. Chemicals Business
• IV. Packaging Business
• V. Summary

Q2/18 Market Situation

Overall demand softened q-o-q due to lower production of beverage and consumer products segment. P.45

Market Segment Situation (Q-o-Q) Market situation Food & Beverage

• Overall demand slightly softened mainly from beverage segment dropped.

Consumer

• Soften demand as a result of lower production during long holiday.

E & E

• Demand grew owing to higher production of air conditioner and export order

increased. Country Situation (Q-o-Q) Market situation Vietnam

• Demand increased from footwear and beverage segment.

Philippines

• Overall demand increased due to strong consumer consumption in food &

beverage segment.

Domestic market ASEAN market

Packaging Chain

Packaging paper prices remained stable while AOCC prices increased due to strong demand from China for high quality grade of OCC. P.46

Note: Based on published regional prices

150 300 450 600 750 $/Ton

Packaging Paper Recovered Paper (AOCC)

Jul/18

220-230 560-570

Q2

Q1/16 450 170 450 170 450 190 460 520 550 Q2/16 Q3/16 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 565 190 Q2/18 465 485 565 210 250 265 255 225 215

Packaging Chain

Total sales volume slightly dropped -1% q-o-q due to the slowdown in domestic demand, while improved +7% y-o-y owning to higher export volume and higher sales in Vietnam. P.47

Note: *Sales Volume from Philippines and Vietnam 58% 55% 53% 50% 55% 53% 15% 15% 18% 21% 18% 16% 27% 30% 29% 29% 27% 31%

631 596 639 641 643 638

100 200 300 400 500 600 700 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 ’000 tons

(65%) (67%)

57% 54% 15% 17% 28% 29%

1,227 1,281

200 400 600 800 1,000 1,200 1,400 H1/17 H1/18

ASEAN Operation* Thailand Export Thailand Domestic

’000 tons

Packaging Paper Volume

+2% y-o-y

• 6% q-o-q

+7% y-o-y

• 1% q-o-q

flat

Fibrous Chain

P&W Paper prices increase as a result of higher pulp prices which continued to increase due to tightened supply. P.48

Note: Based on published regional prices

200 400 600 800 1,000

Short Fiber Long Fiber

$/Ton

Jul/18 Q2 P&W Paper

Q1/16 Q2/16 Q3/16 Q4/16 Q1/17 730 565 640 Q2/17 800 680 Q3/17 740 860 835 Q4/17 Q1/18 880 885 760 Q2/18 765 665 620 650 940 885 770 925-935 880-890 770-780

Fibrous Chain

Total sales volume decreased -8% q-o-q and -4% y-o-y due to overall demand declined. P.49

73% 71% 27% 29%

226 225

50 100 150 200 250 H1/17 H1/18

75% 72% 72% 66% 71% 71% 25% 28% 28% 34% 29% 29%

114 112 110 111 117 108 50 100 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Export Domestic ’000 tons

• 5% y-o-y
• 8% q-o-q

’000 tons

Printing & Writing Paper volume

• 4% y-o-y
• 8% q-o-q

Revenue from Sales by Business chain

Revenue from sales in Q2/18 dropped -1% q-o-q from domestic demand softness while improved +12% y-o-y mainly from higher selling prices and sales volume of Packaging Chain.

P.50

15,121 15,217 16,396 16,960 17,057 17,091 4,720 4,217 4,345 4,479 4,924 4,701

19,841 19,434 20,741 21,439 21,981 21,792

5,000 10,000 15,000 20,000 25,000

Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Fibrous Chain Packaging Chain MB +12% y-o-y

• 1% q-o-q

30,338 34,148 8,937 9,625

39,275 43,773

5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000

H1/17 H1/18 MB 76% 78% 79% 79% 78% 78% Packaging as percent

• f total

61% 29%

10%

H1/18 Sales Segment

ASEAN Domestic Others

43,773

EBITDA and Profit for the Period

EBITDA and Profit increased +7% and +6% and increased +33% and +59% y-o-y due to higher sales volume of Packaging Chain and higher margin from the effect of cost saving initiatives.

P.51

3,832 2,852 2,537 3,132 3,549 3,783 1,679 1,003 754 1,215 1,512 1,598

500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 2,129

553

2,682 3,110 H1/17 H1/18

MB

EBITDA

Profit for the period (MB)

5,823

861

6,684 7,332 H1/17 H1/18

EBITDA (MB)

Profit for the period

3,058

(excl. TUP)

1,174

(excl. TUP)

2,765

(excl. TUP)

955

(excl. TUP)

TUP’s effect TUP’s effect

+59% y-o-y +6% q-o-q +33% y-o-y +7% q-o-q

EBITDA Margin

Note: *EBITDA margin excluded effect from the cease of TUP’s operation.

Packaging 16% 14% 14% 16% 18% 19% Total 15%* 14%* 12%* 15%* 16% 17% Fibrous 15%* 15%* 8%* 12%* 9% 13%

15%* 17% EBITDA Margin

Outlook

P.52

• Overall domestic packaging demand is expected to maintain in Q3/18 while beverage

segment is expected to drop during rainy season.

• Regional packaging demand is expected to slightly increase due to demand

improvement in Vietnam from higher export orders in food and E&E segment, while Indonesia and Philippines are expected to remain stable.

• Recovered paper prices (AOCC) will continue to increase due to strong demand from
• China. In addition to the basic demand and supply dynamics, China’s recovered paper

import regulations continued to play key roles in the global recovered paper markets turbulence.

Agenda

P.53

• I. Consolidated Results
• Q2/18 Consolidated Results
• H1/18 Summary
• Financial Updates

II. Cement - Building Materials Business

• III. Chemicals Business
• IV. Packaging Business
• V. Summary

P.54

Thank You

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