Polyplex (Thailand) PLC (PTL) Fe Februa uary 13 13 th th , 2 , - - PowerPoint PPT Presentation

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Polyplex (Thailand) PLC (PTL) Fe Februa uary 13 13 th th , 2 , - - PowerPoint PPT Presentation

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Thi Third Qua uarter FY FY 2018 2018-2019 2019 Fi Fina nanc ncial Resul sults s & Sum ummary Polyplex (Thailand) PLC (PTL) Fe Februa uary 13 13 th th , 2 , 2019 Disclaimer This presentation may contain forward-looking

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SLIDE 1

Polyplex (Thailand) PLC (PTL)

Thi Third Qua uarter FY FY 2018 2018-2019 2019 Fi Fina nanc ncial Resul sults s & Sum ummary Fe Februa uary 13 13th

th, 2

, 2019

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SLIDE 2
  • This presentation may contain forward-looking statements which are based on the Company’s

current expectations and estimates about the industry, the management’s beliefs and various other

  • assumptions. These forward-looking statements are subject to various risks, uncertainties and
  • ther factors, some of which maybe beyond our control. No assurance is given with regards to

future events or the actual results, which may differ materially from those projected herein.

  • This presentation does not constitute an offer to sell or a solicitation of an offer to buy or sell PTL

stock and in no event shall the Company be held responsible or liable for any damages or lost

  • pportunities resulting from use of this material

Disclaimer

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SLIDE 3

Polyplex: A Brief Introduction

2500+ Employees From Varied Nationalities Working In Harmony Focus on Sustainability Polyplex group is among the world’s largest manufacturers of thin PET Film

Capabilities

  • Thin PET
  • Thick PET
  • BOPP
  • Blown PP/PE
  • CPP

Downstream

  • Metallizing
  • Silicone Coating
  • Offline chemical

coating

  • Extrusion Coating

1600 Cust stomers s in 70 countries s across ss Europe, Americas, s, the Middle East st and th the In Indian Subcont Subcontinent nent

In Operation for 30+ Years

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SLIDE 4

USA Mexico China Thailand Malaysia India Turkey South Korea Netherlands Singapore Indonesia Japan

Manufacturing Locations Upcoming Manufacturing Location

Polyplex: A Global Presence

Warehouse Trading Company / Representative Office

Six Manufacturing Facilities in 5 Countries, Multiple warehouses and Liaison offices around the world

Parent Company Locations

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SLIDE 5

Sachet Pack Ready 2 Eat Pack Spouted Pack Aroma Pack Easy Peeling Lids Can Lamination Stand Up Pouch Susceptor Film Electrical Grade Window Films Electronic Grade PV Backsheets Graphics Construction Liner Grade Optical Grade

P A C K A G I N G I N D U S T R I A L

Value Chain

NATURAL RESOURCES BASIC PETROCHEMICALS RAW MATERIALS PLASTIC & INTERMEDIATE PRODUCTS Ethylene MEG Paraxylene PTA Polyproylene Fi Film Grad ade e PET Resi sin PP Resin Packaging & Industrial Customers Base se Fi Films Co Coatin ing Metallizi zing Ho Holo lography

Na Natural Ga Gas Oi Oil

Polyplex’s Area of operation

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SLIDE 6

CAPACITY

PET Film Resin (MT)

Base Films (MT) Coated/ Value Added Films

77,600 80,500 57,600 57,600 73,000

55,000 58,000 44,000 42,000 31,000 28,800

10,000 8,845

28,500 21,700 17,700 270 865 146 Metallized (MT) Coated (Sqm)

INDIA THAILAND TURKEY U.S.A INDONESIA

U P C O M I N G

P A R E N T

PET Thin PET Thick CPP Blown PP

175,000 28,800 10,000 8,845 54,900 1,011 230,000 28,800 10,000 8,845 83,400

35,000 BOPP

35,000 1,281

Holographic (MT)

2,640

PTL

Consolidated

Polyplex Group

Consolidated

268,700 346,300

9 5 6 2 6 4

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SLIDE 7

Q3 2018 Summary

Q3 Revenue 3,724 Million Thb, 16% YoY Normalized EBITDA 686 Million Thb, 16% YoY, Normalized EBITDA margin 18% Q3 Normalized EPS 0.51 Thb (Annualized 2.03) Operating Cash Flow 298 Million Thb Net D/E ratio: 0.19 , Credit Rating at A- (tha) with ”Stable Outlook” by Fitch Ratings (Thailand) Ltd 22% YoY Increase in Production of Value Add Films

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SLIDE 8

Q3 2018 Production Highlights

Base Films

PET – Thin 33,477 MT

4% YoY 0% QoQ

PET – Thick 5,363 MT

1% YoY

  • 6% QoQ

CPP 2,089 MT

  • 8% YoY
  • 1% QoQ

Blown Film* 1,162 MT

79% YoY

  • 7% QoQ

Metallizer 7,965 MT

14% YoY 11% QoQ

Offline Coated 606 MT

67% YoY 54% QoQ

Saralam 56 Million Sqm

10% YoY

  • 4 QoQ

Saracote 67 Million Sqm

  • 1% YoY
  • 8% QoQ

Value Added Films

*Including new Capacity start up in Q3 *Focus on value added / coated films

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SLIDE 9

Q3 2018 YoY Financial Highlights

EBITDA 686 M Thb

16% YoY

ROCE* 15.08%

303 bps

D/E 0.19 ROE* 16.78%

255 bps

EPS 0.51 Thb Net Profit 455 M Thb

28% YoY

Earnings normalized for Forex Gain/Loss

  • ROCE/ROE figures are annualized and in bps (basis points / bips)

bps = unit of measure to describe the percentage change in the value or rate of a financial instrument. One basis point = 0.01%

28% YoY 5% YoY

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SLIDE 10

0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% 35.00% 40.00% 45.00%

  • 500,000

1,000,000 1,500,000 2,000,000 2,500,000 3,000,000 3,500,000 4,000,000 4,500,000

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 YTD 9M annualized

Normalized EBITDA* As % of Revenue

EBITDA* (PTL Consolidated)

591 698 686

480 540 600 660 720 Q3'17 Q2'18 Q3'18

Million

16% YoY growth in Normalized EBITDA led by improved market conditions and capacity debottlenecking 18% EBITDA Margin

*Normalized for Forex gain/(loss) and one time exceptional items (impairment loss in 2015-16)

16% YoY

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SLIDE 11

1.07 1.14 1.22 4.82 1.85 0.28 (0.12) (0.11) 0.37 1.18 1.59 2.03

  • 1

1 2 3 4 5

2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 YTD 9M annualized

EPS* (PTL Consolidated)

0.40 0.51 0.51 Q3'17 Q2'18 Q3'18

YoY improvement in Normalized EPS led by narrowing demand-supply and improvement in operating efficiencies

*Normalized for Forex gain/(loss) and one time exceptional items (impairment loss in 2015-16), post dilutive effect of Rights issue in 2016

28% YoY

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SLIDE 12

* Annualized and normalized

ROCE

0.79 0.59 0.26 0.17 0.19 31.3.2015 31.3.2016 31.3.2017 31.3.2018 31.12.2018

  • Slight increase due to borrowing for

PFI (Polyplex Indonesia) as well as smaller investments in Thailand

Net D/E

  • Improving Industry CUF
  • Improved CUF across business verticals
  • Increased capacity via de-bottlenecking
  • Continued focus on cost structure

2.03% 7.35% 9.14% 12.30% 15.08% FY 14-15 FY15-16 FY 16-17 FY 17-18 YTD (31.12.2018)

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SLIDE 13

Ø Improved margins owing to widening gap between RM cost and prices – eventually to be corrected Ø Profitability maintained despite low season Ø Improved CUF of downstream businesses Ø Focus on increased capacity in Indonesia Ø Improved margins owing to widening gap between RM cost and prices – eventually to be corrected Ø Profitability maintained despite low season

Regional Overview and Outlook

  • Mature and Protected Market
  • Premium placed on domestic supply
  • Pricing more longer term
  • Receding RM cost
  • Q3 typically slow quarter
  • Fastest growing region
  • Demand supply Balance in China –

improved Chinese margins = overall improved industry margins in the region

  • Mature and Open Market
  • Pricing mostly quarterly
  • Premium placed on domestic supply
  • Receding RM cost
  • Main competition = Indian imports
  • Q3 typically slow quarter

29% 36% 32% 3%

Polyplex Region wise Sales Mix*

Asia North America Europe Others

*Data from 2017-2018

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SLIDE 14

Current Updates

Indonesia :

  • Estimated Start Up Date: August 2019
  • Updated Project Cost within budget
  • Construction in full swing
  • Machine delivery underway with main

components already on site

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SLIDE 15
  • In 2013-14 product differentiation withstood the negative cyclical effects
  • Strategy to increase specialized products & applications over the next few years to further hedge

against market cyclicality

* Normalized for Forex gain/(loss) and any one time exceptional items (impairment loss in 2015-16)

Initiatives

Specialized Products and Applications

  • 100

200 300 400 500 600 700 800 900 FY 12-13 FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 Annualized 2018-19

MN THB/ annum

Net Margin from High Value Add and Specialty (HVAS) Films

0% 10% 20% 30% 40% 50% 60% 70% 80%

500 1,000 1,500 2,000 2,500 3,000 FY 12-13 FY 13-14 FY 14-15 FY 15-16 FY 16-17 FY 17-18 Annualized 2018-19

MN THB/ annum

EBITDA v/s Net Margin from HVAS

EBITDA (normalized) Net Margin from HVAS as % of EBITDA

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SLIDE 16

Sustainability: Outlook and Actions

Green PET Film

PVC Twist Wrap Film with Green PET wrap film in the Confectionary Industry Aluminium foil with metallized barrier PET film in food packaging ( + cost reduction) Dedicated recycling unit in Thailand – sustainable solutions for plain/coated film waste and post- consumer waste (Prod. Capacity of 1300 MT/Month)

Bio Based Films – (Bio MEG) Bio Degradable Films Mono – Layer Blown Film This unit is a member of Ceflex This unit is partnered with RafCycle Initiative Produces R-PET resin using post consumer waste

DEVELOPED REPLACED INVESTED

500000 1000000 1500000 2000000 2500000 2012 2013 2014 2015 2016 2017 Savings Investments

LED Lighting Direct Melt Casting Twin Screw Extruder Auto water Treatment for Cooling Tower Chill Roll Free Cooling Erema Free Cooling TDO Heat Recovery Oxygen Trimming System for Burner VAM Chiller for waste heat utilization VFD Implementation :

  • Offline Coater Main Hot Oil

Pump

  • Chips Cooling Tower Circulation
  • Thermal Fluid Pumps

SAVED ENERGY

R-PET film (70-90% PCR Content)

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SLIDE 17

Global Demand And Supply | RM and Film Price Trends

  • Improving industry CUF despite new investments
  • Improving Chinese margins
  • ½ Mn capacity addition announced to start up by 2021 – temporary disruption

(margin depression) expected

85% 70% 73% 76% 79% 81% 85% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 2011 2016 2017 2018 2019 2020 2021 KMTPA Global Capacity Global Demand CUF (%)

1.06 1.03 1.13 1.33 1.14 1.22 1.33 1.58 1.62 1.75 1.86 0.79 0.80 0.85 0.95 0.85 0.97 1.01 1.09 1.06 1.20 1.26 0.26 0.23 0.28 0.38 0.29 0.25 0.33 0.49 0.56 0.54 0.60 0.00 0.20 0.40 0.60 0.80 1.00 1.20 1.40 1.60 1.80 2.00 Q1 FY 16-17 Q2 FY 16-17 Q3 FY 16-17 Q4 FY 16-17 Q1 FY 17-18 Q2 FY 17-18 Q3 FY 17-18 Q4 FY 17-18 Q1 FY 18-19 Q2 FY 18-19 Q3 FY 18-19

China VA Trend

12µ PET Resin VA

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SLIDE 18

Key Takeaways

Polyplex Thailand is well positioned to deliver value with its Strong and Steady Growth evidenced by growing EBITDA Global Presence and Leadership Focus on Sustainability Diversification of Product Mix