Thai Oil Public Co. Ltd. · SET:TOP
Thai Oil Public — Q2 2010 Earnings Presentation
50 slides from Thai Oil Public's earnings presentation, 2010
Slide 1: Thai Oil Group
http://www.thaioilgroup.com
Slide 2: Confidentiality notice
The information contained in this presentation is intended solely for your personal reference. Please do not circulate this material. If you are not an intended recipient, you must not read, disclose, copy, retain, distribute or take any action in reliance upon it. 2
Slide 3: Vision, Mission, Value
A LEADING FULLY INTEGRATED REFINING & PETROCHEMICAL VISION COMPANY IN ASIA PACIFIC • To be in top quartile on performance and return on investment • To create a high-performance organization that promotes MISSION teamwork, innovation and trust for sustainability • To emphasis good Corporate Governan
Slide 4: Corporate Governance Policy Roles and Responsibilities for Stakeholders
Corporate Governance Policy Roles and Responsibilities for Stakeholders The board of directors, management • Truthfully report company’s situation and and all staff shall commit to moral future trends to all stakeholders equally principles, equitable treatment to all on a timely manner. stakeholders
Slide 5: Q2/10 Highlights, Performance Analysis, Market Outlook
Q2/10 Highlights Performance Analysis Market Outlook 5
Slide 6: Q2/10 Highlights
Q2/10 Highlights
Slide 7: Market Condition and Performance Highlights
Market Condition • Based GRM improved on firm middle distillate markets driving from higher demand from the region. • Aromatics margin dropped as a supply glut from China and Middle East depressed prices. • Robust lube base margins due to strong demand generated by the economic recovery and the tigh
Slide 8: Performance Analysis
Thood 5@ Performance Analysis
Slide 9: Market GRM
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials GO + Higher ME demand for power plant LPG (controlled price) (Unit: $/bbl) + Continued strong spot demand from India - Lower China demand during annual fishing -16 ban period in South China Sea -24 -31 -40 11 -47 -48 -49
Slide 10: Market GRM, Crude Oil Price, Stock Gain/Loss
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials (Unit: $/bbl) Crude Oil Price - Dubai Market GRM (Unit: $/bbl) + Positive industrial data to support oil demand 100 - Concern over EU’s debt crisis - High US crude stock - Sell-off in global equity market 3.8 1.2 0.7 2.7
Slide 11: Sources of Crude and Spread over Dubai
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Sources of Crude Spread over Dubai Spread over Dubai (US$/bbl) (US$/bbl) Others1 4% 3% -10.7 2 3% 2 -15.5 LPG 9% 13% Far East 14% 14% Platformate 2% Local 12% 16% 12.6 16% 9.4 Gasoline 19% 9.4 19% 11.7 Jet Middle East 87
Slide 12: Domestic Oil Demand, Refinery Intake, Sales
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Domestic Oil Demand / Refinery Intake Domestic Oil Demand (KBD) 3% (KBD) 1,400 89% 88% 86% 89% 89% 89% 87% 100% 739 714 1,200 80% 1,000 1H/09 202 138 147 60% 1H/10 0% 800 215 221 155 192 600 40% -4% 330 328 17% 400 699 7
Slide 13: Aromatics Spot Prices & Margins
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Aromatics Spot Prices & Margins (US$/Ton) Q1/09 Q2 Q3 Q4 Q1/10 Q2 1H/10 2010 %Utilization PX-ULG95 384 475 355 321 286 226 256 Q1 Q2 1H BZ-ULG95 -60 79 160 178 215 159 187 87% 88% 88% (US$/Ton) 384 1,200 89 Paraxylene (P
Slide 14: Base Oil & Bitumen Spot Prices & Margins
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Base Oil & Bitumen Spot Prices & Margins (US$/Ton) Q1/09 Q2 Q3 Q4 Q1/10 Q2 1H/10 2010 %Utilization 500SN-HSFO 398 268 404 429 375 435 541 Q1 Q2 1H BIT-HSFO 70 -5 -3 -23 10 27 38 92% 94% 93% (US$/Ton) 374 10 Lube Base Oil
Slide 15: Accounting GIM and Market GIM
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials (US$/bbl) 20.6 20.3 20.7 20.2 15.7 20.4 13.4 14.5 Product to Feed Q1/09 Q2 Q3 Q4 Q1/10 Q2/10 1H/09 1H/10 (US$/bbl) 3.8 2.7 2.9 2.8 2.5 Market 1.2 0.7 Crude GRM* -1.4 Q1/09 Q2 Q3 Q4 Q1/10 Q2/10 1H/09 1H/10 (US$/bbl) 19.0
Slide 16: Q2/10 Net Profit Breakdown
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Refinery Aromatic Lube Base Plant Plant Ship SAKC Utilization Utilization Production Production Availability Utilization Utilization 98% 93% 105% 94% 94% 97% 93% 88% 87% 93% 76% 83% 85% Q2/09 Q2/10 . 13% *HDS-2 S/D 13 da
Slide 17: Financial Ratios
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Balance Sheet Consolidated Long-Term Debt 1) (Unit: MB) 137,745 138,218 1H/10 Total LT Debt Net Debt LT Debt* Bt. 44,486 mn. Bt. 34,282 mn. Current 42,134 44,486 (US$ 1,365 mn.) (US$ 1,052 mn.) Assets Trade Payable 23,92
Slide 18: 2010 Market Outlook
2010 Market Outlook •July 2010 Market Highlight •Macroeconomics & Crude Prices •Petroleum Market •Aromatics & Base Oil •Conclusion
Slide 19: July 2010 Market Highlight
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion ‘10 ‘10 ‘10 Q1 Q2 QTD Crude declined on weak economic data and Dubai 76 78 73.6 absence of hurricane Strong regional demand for gasoline and MO-DB 13 9.4 9.7 gasoil and supply disruption supported GRM JET-DB 9
Slide 20: Macroeconomics & Crude Prices
Macroeconomics & Crude Prices
Slide 21: Economic sentiment, manufacturing, unemployment, retail sales
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Sentiment “Unusually Uncertain” Slowdown in manufacturing globally 65 110 Economic Sentiment CN 45 PMI IN JP (RHS) US 100 55 JP EU 40 EU 90 CN 35 45 80 US 30 35 70 60 25 25 50 20 15 Jul Nov Jul Mar Mar Apr Apr
Slide 22: 2010 and 2011 GDP Forecast
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion 2010 GDP Forecast (%YoY) 2011 GDP Forecast (%YoY) 12% 12% 10% 10% World 8% 8% 6% US 6% 4.6% 4.3% 4% EU 4% 2% 2% JP 0% 0% CN -2% -2% -4% IN -4% Jan-09 Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-09 Jan-10 Apr-
Slide 23: Global Oil Demand Outlook 2009/2010/2011
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Global Oil Demand Outlook 2009/2010/2011 Thousands barrels per day FSU Europe North America 177 121 345 -890 -260 -78 -20 -236 Middle East 347 231 315 Asia -884 910 537 654 Africa Latin America 3 41 114 238 210
Slide 24: WTI Prices vs Dow Jones, USD:EUR, Net Long
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion WTI Prices vs Dow Jones Index WTI Prices vs USD:EUR $/BBL Points 90 12,000 $/BBL 90 USD/EUR 1.57 80 11,000 80 1.50 70 10,000 70 1.43 60 9,000 60 1.36 50 8,000 50 Though EUR has weakened 1.29 Funds flow is still
Slide 25: Crude Price Forecast
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Crude Price Forecast 2011 WTI Price Forecast As of $/BBL $/BBL UBS 80.00 17-Nov-09 100 2009 WTI Standard Chartered 82.00 27-Jan-10 2009 Dubai 90 2010 WTIF JPMorgan 90.00 25-Feb-10 87 2010 DubaiF 85 82 Deutsche
Slide 26: Petroleum Market
Petroleum Market GRM has significantly improved … BUT will it last?
Slide 27: US, EU, Singapore Cracking Margins
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion 20 20 20 US Cracking Margin EU Cracking Margin Singapore & TOP Margin 16 16 16 TOP S’Pore Crk S’Pore Hydro 12 12 12 8 8 8 4 4 4 0 0 0 -4 -4 -4 -8 -8 -8 Jan-10 May-10 Jan-10 May-10 Jan-10 May-10 Jan-09 May-09 Ja
Slide 28: High inventory of middle distillates could pressure margin
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion High inventory of middle distillates could pressure margin if demand can’t catch up with supply 28
Slide 29: Breathing period during 2011-13
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion “1st wave has passed Breathing period during 2011-13 KBD before 2nd wave of new ME refinery during 2014-16” 3,500 2.47 MBD ME Additional Demand 3,000 1.47 MBD AP Additional Demand 2,500 Taiwan 3.75 MBD ME 2,000
Slide 30: Expect refining capacity closures by 2020
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion “Expect 10 MBD of refining capacity to close down by 2020” 30
Slide 31: Aromatics
Aromatics Market Imbalance, Waiting for demand to catch up with supply
Slide 32: Major applications of Aromatics products
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion “ Major applications of Aromatics products ” Shaoxing Fabric Transaction (Daily Average) PX BZ @ Shaoxing Market US Auto Sales (sqm mn) (sqm mn) China Construction Activities “ 4 major areas where productions a
Slide 33: PX and BZ Additional Supply
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion PX Additional Supply BZ Additional Supply Q1’09 Q2’09 Q3’09 Q4’09 Q1’10 Q2’10 Q3’10 Q4’10 Q1’11 Q2’11 Q3’11 Q4’11 Q1’09 Q2’09 Q3’09 Q4’09 Q1’10 Q2’10 Q3’10 Q4’10 Q1’11 Q2’11 Q3’11 Q4’11 Period Company, Site PX
Slide 34: PX and BZ Additional Supply
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion PX Additional Supply BZ Additional Supply Q1’09 Q2’09 Q3’09 Q4’09 Q1’10 Q2’10 Q3’10 Q4’10 Q1’11 Q2’11 Q3’11 Q4’11 Q1’09 Q2’09 Q3’09 Q4’09 Q1’10 Q2’10 Q3’10 Q4’10 Q1’11 Q2’11 Q3’11 Q4’11 Period Company, Site PX
Slide 35: World PX Capacity and Aromatics Cash Cost
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion World PX Capacity Aromatics Cash Cost (Integrated Plants) $/Ton Jul Aromatics margin over Naphtha EU NEA TPX China / USA Thailand ME TPX No. of plants PX base on 50%:50% Spot and ACP Other base on 100% Spot “ S
Slide 36: Global PX and BZ Supply-Demand
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Global PX Supply-Demand Global BZ Supply-Demand • PX demand grows at 6.5% during 2011-2015with China and India who will account for nearly all global growth in PX demand as they continue to dominate global text
Slide 37: Base Oil & Bitumen
Base Oil & Bitumen Taking Advantage of supply shortage
Slide 38: Supply shortage and low HSFO push base oil margin higher
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Formosa’s blast effect Supply shortage due to Gr.II Base Oils production Pertamina S/D since early ‘10 Jul Taiwan’s Formosa had shut its 520 Fire causing shutdown of 720 KT/year Gr.I KT/year Gr.II base oils aft
Slide 39: Developing Asia Pacific: China and India
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion China Car Sales 2005-2010 Developing Countries in AP: Total Car Sales China Lubricant Production Source : Bloomberg, Auto Fact Developing Asia Pacific : China and India • China’s PCMO market post over 29% QoQ g
Slide 40: Stimulus budget will continue to support bitumen demand
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion China Expands its Investment in Rapid Thai government’s stimulus package Transit, Paving Way for Future Urban Growth related to road upgrading, Dust-free road China Bitumen Import Phrase II (2011-12) 3,960 $576
Slide 41: Conclusion
Conclusion
Slide 42: Outlook: Refinery, Aromatics, Base Oil
July 2010 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion 2H/2010 2011-13 Moderate economic growth with slower Refinery Slower but steady economic recovery growth from Asia and Europe Crude prices range $70-$85/barrel in H2, with Expect crude prices to move above $80/
Slide 43: Q&A
Q&A
Slide 44: Thank You
Thank You Any queries, please contact: Investor Relations at email: ir@thaioilgroup.com Tel: 662-797-2999 Fax: 662-797-2976 44
Slide 45: Appendices
Appendices
Slide 46: LPG Demand Highlight
Thailand LPG Demand LPG Demand Highlight ML/Mth 900 • LPG Demand in Q2/10 grew 13.6% YoY driven 830 850 801 816 801 793 mainly by industry & Petrochem: 800 750 729 Household +10.3% YoY 700 2008 Transportation -1.9% YoY 650 600 2009 Industry +40.2% YoY 550 500 Petrochemical +16.0% YoY 450 201
Slide 47: Gasoline Demand Highlight
Thailand Gasoline Demand Gasoline Demand Highlight ML/Mth 700 • Gasoline demand contracted 3.8% YoY in Q2/10 due to higher retail price comparing 650 to last year 620 617 607 606 592 599 2008 • Portion of gasohol & gasoline sales is 600 relatively maintained at around 60% : 40% 2009 550 • Average et
Slide 48: Jet-A1 Demand Highlight
Thailand JET-A1 Demand JET Demand Highlight ML/Mth 500 • Despite Bangkok crackdown situation in May, Jet fuel demand in Q2/10 was relatively 450 425 422 healthy with growth of 6% YoY (in line with 400 387 378 2008 flight number growth of 5.8% during the 334 334 same period) 350 2009 300 2010 250 Jan
Slide 49: Gasoil Demand Highlight
Thailand Gasoil Demand Gasoil Demand Highlight ML/Mth • Gasoil demand contracted 1.1% YoY in Q2/10 1,800 1688 • More biodiesel replacement in 1,700 1588 Q2/10, particularly from Jun onward as the 1565 1546 1,600 1550 1509 minimum blended biodiesel is shifted from 2008 1,500 B2 to B3 (now only 2 grad
Slide 50: Fuel Oil Demand Highlight
Thailand Fuel Oil Demand Fuel Oil Demand Highlight ML/Mth 500 • FO demand grew 3.3% YoY in Q2/10 soften from 9% YoY expansion in Q1/10 as no 400 unexpected EGAT requirement occurred in Q2 292 300 2008 • Besides critical swing demand from power 210 216 219 224 206 200 sector, bunker demand expanded h
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