GC Opportunity Day FY2018 Performance Presentation The Stock - - PowerPoint PPT Presentation

GC Opportunity Day

FY2018 Performance Presentation

The Stock Exchange of Thailand

26 February 2019 1

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. PTTGC 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 PTTGC 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.

Disclaimer

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Vision and Mission

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PTTGC Sustainable Development

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Agenda

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02 01

2018 Financial Result 2018 Key Achievement

Overview of business unit performance

Operating rate

FY18 net profit at 40,069 MB, +2% yoy, because of

• Increasing in sale volume from having high operating rate

and new capacity of LLDPE II, 400KTA, which COD in March

• Average HDPE price, $1,330/T, increase by +14% yoy,

meanwhile improving in phenol performance and increasing in share of profit of investment as full year realize the benefit from asset injection project. This mainly support from upside of acrylonitrile business.

• These partial offset by effect to stock loss in Q4, from

dropping of oil price at the end of the year.

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39,298 4,714 1,894 469 4,394 2,516 40,069

2017 2018

Performance comparison YoY 7

Stock Gain/(Loss) & NRV&Commodity Hedge 2018 = (3,331) 2017 = 1,383 FX Gain/(Loss) 2018 = 407 2017 = 2,301 Unit : MB Operating Profit from main BUs Others Sharing from Subsidiaries, JV & Associate 2018 = 7,209 2017 = 2,816 Loss from GGC’s inventory (72.29%) net DTA = (1,272)

• Comparing with previous year, the main operation was improved especially from increasing in volume as a result of improving in
• perating rate and additional capacity of LLDPE II since March 2018. Phenol performance is also improve from tight supply in the market.

Sharing from JV & Associate was increased mainly from PTTAC which AN was increased as well as improving in performance from NatureWorks because of accessing to high value product market. In 2018, GC has fully realize the benefit from asset injection project, which was completed in July 2017.

• Nevertheless, the soften in oil price, impact from US-China trade war and geopolitical have impact to product price and demand growth,

which lead to softening in polyethylene price and stock loss, especially in the last quarter. Refinery GRM is also impact from decreasing in ULG and Naphtha spread and Aromatic BTX margin is slightly decrease from pressure of expecting new capacity in 1H but recovery after gaining support from PX downstream demand and less than expectation of new volume to the market in 2H.

12,793 2,153 529 7,327 85 1,191 4,060

Q3-18 Q4-18

Performance comparison QoQ 8

Stock Gain/(Loss) & NRV&Commodity Hedge Q4’18 = (6,749) Q3’18 = 578 FX Gain/(Loss) Q4’18 = 252 Q3’18 = 167 Unit : MB Operating Profit from main BUs Others Sharing from Subsidiaries, JV & Associate Q4’18 = 1,580 Q3’18 = 2,108

• Overall operating profit from main BUs in Q4’18 was lower than previous quarter as a consequence of
• Mainly from dropping in oil price and polyethylene price in the period, while there are S/D of 3 polymer plants in the

period, which leads to high selling volume of ethylene that facing downward trend in this quarter. This quarter is also has impact from stock loss from decreasing of oil price.

• Sharing from JV & Associate was decreased from decreasing of product spread of main product i.e. PP, AN.

’ DTA from GGC’s inventory loss = ’

Strong Financial Position

Cash Flow

THB Bn

Statements of Financial Position

Cash +ST Investment CA PPE Liab. IBD Share Holder’s Equity Dec 31,2018 469 Bn Dec 31,2017 435 Bn

• Cash & ST Investment (54 billionTHB) and private fund

and inhouse management of 6.8 billion THB at the end

• f 2018.
• In 2018, the interest bearing debt is 61% on fixed rate

and 39% is float rate. THB debt is a major portion of 57% of our debt profile, while 43% is in USD, mainly from US Bond.

• 2018 CAPEX still based our core investment from
• ngoing projects, including ORP, PO (GCO) ,Polyols

(GCP).

• The repayment profile is around 10 billion THB per

year on average but 2021 will increase from THB bond retirement (4-yr, 3.05%), as well as 2022 will increase from USD bond maturity.

• The average loan life is ~3.43 years with average cost of

long term debt ~3.85%.

Note : Private Fund and In house management around 6,800MB

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Non CA

80 75 245 220 90 85 54 55 303 280 97 98 69 57

55 54 54 28 27

Beginning Cash + S/T Investment Operating Cash Flow CAPEX Financing Ending Cash + S/T Investment

Agenda

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02 01

2018 Financial Result 2018 Key Achievement

2018 Key achievement

2018 Achievement

Another record year of net profit of 40,069 Million bath Maintain high operating rate in all major units

REF 102%

(103% in 2017)

ARO 93%

(80% in 2017 )

OLE 101%

(96% in 2017 )

POL 100%

(113% in 2017)

Execution of downstream integration

• Acquisition of PTA 970KTA and PET 147KTA
• Acquisition of Rotomolding Compound 61KTA

Achieved sale target in CLMV

Achieved polymer sale volume > 250KT

DPS

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… … … … … … …

• JV in PA9T and HSBC business
• Full year benefit from realizing JV

performance from asset injection deal, which closed in July 2017.

• Enhance performance from surging in

Phenol, Acrylonitrile and PP chain. Achieved polymer sale volume through JV in Myanmar ~3KT in the past year

Sustainable Growth

Strengthen production home base

• Joint venture in Myanmar with strategic partner
• Establish sale office in Myanmar and Vietnam
• Establish logistic business in Vietnam
• Achieved MAX target of 10,800MB
• Kick off digitalization module
• Establish GC Treasury Center for fx management

and USD fund raising

• Production flexibility of LLDPE/HDPE in 1H19
• Establish Customer Solution Center to

support marketing strategy to grow as a partner with customer

3Rs Concept

(Reduce / Reuse / Recycle)

Efficiency enhancement Market Strategy & Intelligence Expand market portfolio in high growth region Sustainable development

Bio- packaging

Fashion Items

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Long term strategic execution

• Constructing new 1.1MTA of new capacity
• Project progress
• ORP

~32% (COD 2H20)

• Propylene oxide ~36% (COD 2H20)
• Polyols

~41% (COD 2H20)

• KRR

COD 2022

• Considering investment opportunity through

Joint venture, Green field and M&A

Strategic investment through the value chain Opportunity to strengthen investment base

• Explore opportunity in EEC and

alignment with policy

• Resource preparation for

investment roadmap i.e. GC Estate for land preparation

International strategic investment Future opportunity in green business

• Explore opportunity in

international strategic investment in the region that can support existing value chain or new market

• pportunity in both green

field and M&A

• Opportunity in bio complex in

Thailand

• Balance portfolio and align with

global trend i.e. potential investment in recycle plant, COD

• f ME II in Q1’19

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Thank You

1 Thitipong Jurapornsiridee VP-Corporate Finance & IR Thitipong.j@pttgcgroup.com +662-265-8574 2 Jittasak Soonthornpan IR Manager Jittasak.s@pttgcgroup.com +662-265-8172 3 Nattchanon Chawinsittangkul IR Analyst Nattchanon.c@pttgcgroup.com +662-265-8364 4 Pantaree Nantanakom IR Analyst Pantaree.n@pttgcgroup.com +662-140-8714 5 Jinthip Prakobwit IR Analyst Jinthip.p@pttgcgroup.com +662-265-8361 6 Preeyapa Asarangchai IR Analyst Preeyapa.a@pttgcgroup.com +662-265-8213 7 Pavena Thongpan Coordinator zPavena.T@pttgcgroup.com +662-265-8421

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