Tpi Polene Public Co. Ltd. · SET:TPIPL
Tpi Polene Public — 9M 2023 Earnings Presentation
39 slides from Tpi Polene Public's earnings presentation, Dec 4, 2023
Slide 1: TPI Polene Company Update SET Opportunity Day – 3Q 2023
TPI Polene Company Update SET Opportunity Day – 3Q 2023 4 December 2023
Slide 2: Disclaimer
Disclaimer: The information contained in this presentation is for information purposes only and does not constitute an offer or invitation to sell or the solicitation of an offer or invitation to purchase or subscribe for share in TPI Polene Public Company Limited ( “The Company”) in any jurisdictio
Slide 3: Topics
Topics Business Overview Financial Performance & Position Outlook and Guidance Sustainability and Other Matters Opportunity Day
Slide 4: The Corporate Structure
The Corporate Structure TPI Polene Public Company Limited Agriculture, Healthcare & Construction Specialty Polymers &Chemicals Others Energy/Utilities 70.24% TPI Concrete Co., Ltd. 99.99% TPI All Season Co., Ltd. 99.99% Thai Propoxide Co., Ltd. TPI Polene Power Plc. 99.99% 99.99% Thai Nitrate Co., L
Slide 5: Key Assets and Features
Key Assets and Features Construction Materials Specialty Polymers/Chemical Segment Energy & Utilities • Specialty Polymers – 158k tpy capacity • Total current capacity 440 MW as below comprising >65% • Cement - 4 lines totaling 13.5m tpy capacity − HVA, customized with in-house proven R&D Green powe
Slide 6: Comprehensive and diversified product suite
Comprehensive and diversified product suite > 5,000 SKUs Opportunity Day 6
Slide 7: Strong Innovation Culture – The Many Firsts In Thailand
Strong Innovation Culture – The Many Firsts In Thailand Innovation creates competitive moats and better-than peers’ margins Most diversified mortar portfolio (non-shrink, sulfate-resistance, etc) First to produce hydraulic cement First and only stucco wall producer First and only cement producer tha
Slide 8: Strong Innovation Culture – A Patent
Strong Innovation Culture – A Patent The innovative products, could help TPIPL penetrate a wider market. According to IndustryARC’s latest market research the fiber cement market is forecast to grow 6.2% pa reaching USD16.81 billion by 2030. Link: https://lnkd.in/gh9vdUBq Opportunity Day
Slide 9: EBITDA margin better; valuation cheaper relative to peers
EBITDA margin better; valuation cheaper relative to peers Local peer comparison: EBITDA margin Specialty polymers’ superior spread profile 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 7Q avg ConsMat Positioning in EVA Peer 1 12.0% 9.8% 7.7% 4.0% 9.5% 9.9% 8.0% 9.0% really HVA Peer 2 22.0% 25.0% 13.0% 7.0% 15.
Slide 10: Financial Performance & Position
Financial Performance & Position
Slide 11: 9M/3Q 2023 Performance
9M/3Q 2023 Performance Common Size Common Size THB million 9M22 9M23 YoY 9M22 9M23 THB million 3Q 2022 3Q 2023 % Growth 3Q 2022 3Q 2023 Sales 37,434 33,528 -10.4% 100 100 Revenue 12,523 10,838 -13% 100 100 COGS (inc dep'n) (27,032) (25,716) -4.9% (72.2) (76.7) COGS (9,095) (8,008) -12% (72.6) (73.9)
Slide 12: Segment performance 9M 2023
Segment performance 9M 2023 ConsMat Division is 56% of TA, 56% of sales but 26% of EBITDA generation Specialty Polymer/Chemicals has small asset base but 2nd in sales and 3rd EBITDA generation YoY Growth YoY Growth 6% -15% -37% -58% -2% 19% -19% -84% -10% -27% Performance Profile 9M 2023 % of Sales
Slide 13: Performance Drivers 3Q 2023
Performance Drivers 3Q 2023 • CCM: Volume sales for cements rose by 4% YoY , thanks to strong sales of hydraulic cement. It was slightly QoQ as per seasonality. The good performance of hydraulic cement is inline with our push to Green Cement & Building Products. However, for the whole CCM division w
Slide 14: EBITDA margin sequentially improving
EBITDA margin sequentially improving Opportunity Day 14
Slide 15: Financial – falling leverage ratio; defensive cash positioning
Financial – falling leverage ratio; defensive cash positioning Funding costs: ~4.0% TRIS rating A- 1st time ever @ A level * Calculated: 1) Accounts & other receivables + 2) Inventories - 3) Accounts & other payables Opportunity Day 15
Slide 16: Outlook and Guidance
Outlook and Guidance
Slide 17: Variables to watch
Variables to watch • CCM: thus far, Thailand’s gross fixed capital formation (FCF) have been weaker this year compared to 2022 partly due to the slow formation of the government. Now that the government is formed, but thus far the approval of 2024 national budget is delayed causing the stagnation of
Slide 18: Variables to watch cont’d…
Variables to watch cont’d… Energy prices off the 2021/22 highs EU gas prices = drives Ft (main factor) Ft adjustment for Jan-Apr 2024 (2024) mentioned in discussions Opportunity Day 18
Slide 19: Variables to watch – demand drivers
Variables to watch – demand drivers 9M23 presales tracking below the internal targets for most ResProp Developers 2023G by THBm 1Q23 2Q23 3Q23 YoY QoQ 9M22 9M23 YoY% Company 9M23/2023F ANAN 5,302 4,408 5,150 26% 17% 10,202 14,860 46% 17,034 87% Likely to remain high on LPN 2,786 2,621 2,581 30% -2%
Slide 20: Specialty Polymer – manufacturing is the main growth driver
Specialty Polymer – manufacturing is the main growth driver China as proxy of global demand and supply PMI data indicates weak manufacturing activities globally Source: SCI-IBU Opportunity Day 20
Slide 21: TPIPL continues to push HVA limits
TPIPL continues to push HVA limits High EVA - Adhesive & Cable HVA EVA EVA – Solar Film EVA – Foam & coating Profit LDPE Difficulty Opportunity Day 21
Slide 22: Polymer prices are still soft, signs of improvement fizzled
Polymer prices are still soft, signs of improvement fizzled Source: ICIS Opportunity Day 22
Slide 23: Baseline Assumptions – slight downside on Sales & EBITDA
Baseline Assumptions – slight downside on Sales & EBITDA Guidance early this year Revised down 9M 2023 relative to EBITDA guidance set early this year: • CCM is 46% - slow clinker exports, delay in formation of government • Specialty Polymer/Chemicals is 64% - squeeze in spread is tighter due to ris
Slide 24: Allocated capex 2023-2024
Allocated capex 2023-2024 CAPEX Deployed 1Q23 1H23 9M23 TPIPL Acquisition of PPE 2,137 3,530 6,302 Advances payment PME 287 714 1,027 2,423 4,244 7,329 TPIPP Acquisition of PPE 994 1,829 3,551 Advances payment PME 276 647 886 1,271 2,477 4,437 Capex in TPIPP/TPIPL consolidated 52% 58% 61% * TPIPP ge
Slide 25: Sustainability and Other Matters
Sustainability and Other Matters
Slide 26: Sustainability Scorecard for 9M 2023
Sustainability Scorecard for 9M 2023 TPIPL Units % Remarks Enviromental Management WTE replacing coal - achievable level 25%** 286,150 14% % of total 60-ton EV trucks 41/4/8 EV trucks/EV wheel loader/converted diesel Reduction in energy consumption (GJ) 2,349,224 8% Higher reduction Reduction GHG in
Slide 27: Our Carbon Situation (Scope 1)
Our Carbon Situation (Scope 1) Opportunity Day 27
Slide 28: Carbon price trends
Carbon price trends Based on forecast: Voluntary market and hybrid scenario indicate that carbon prices will be higher by 2050 Note: SBTi (science-based targets initiative) requires that companies set targets based on emission reductions through direct action within their own boundaries or their val
Slide 29: Proud Moments That Validate Our ESG and BCG Efforts: 9M23
Proud Moments That Validate Our ESG and BCG Efforts: 9M23 TPIPL: Best Sustainable Development 2023 3G Excellence Awards - CSR Activities 2023 Best Corporate Governance Company in Thailand 2023 Brands & Business Magazine International Business Magazine Global Business Review Magazine 3G - Global Good
Slide 30: New Initiatives – Hinges on Strong R&D Capabilities
New Initiatives – Hinges on Strong R&D Capabilities Another Milestone 1 June Major launch of Green Cement and Building Materials Innovation creates competitive moats and better-than peers’ margins TPIPL builds-up from in-house R&D capability; no bolt-on acquisitions Opportunity Day 30
Slide 31: Green Cement (Low CO2 Emission)
Green Cement (Low CO2 Emission) EV Dump truck Hydraulic Cement • Decrease Clinker ratio Kiln Energy Efficiency Improvement • Modify Circulate Clinker cooler grate plate Coal Substitution • 25% MSW replacement Regeneration Downhill Belt Conveyor • Industrial Waste • Shale / Limestone belt conveyor Re
Slide 32: TPI Green Products (Low CO2 Emission)
TPI Green Products (Low CO2 Emission) Opportunity Day 32
Slide 33: Green Cement – TGO Certified
Green Cement – TGO Certified Opportunity Day 33
Slide 34: Conveyor Belt – Quarry to Facility
Conveyor Belt – Quarry to Facility Opportunity Day 34
Slide 35: MSW in Calciners
MSW in Calciners For more details: Link https://drive.google.com/file/d/1h3yYa8c2eoeSM7U2NZ-Ut_qmICfdJyU-/view?usp=share_link Opportunity Day 35
Slide 36: CDE for Limestone Scrap
CDE for Limestone Scrap For more details: https://www.cdegroup.com/about/case-studies/tpi-thailand Opportunity Day 36
Slide 37: EV Dump Trucks for Quarrying
EV Dump Trucks for Quarrying 2022 - 2023 On April 7, 2023 Yutong officially shipped 10 YTK90E battery electric mining trucks, which will be delivered to TPI Polene Public Company Limited (TPIPL), the second largest cement producer in Thailand, for transporting stone between mines. For more details h
Slide 38: Litigation Cases – Still At The Supreme Court
Litigation Cases – Still At The Supreme Court The Court ordered the Company by Case Charge/ Environmental Acts B.E. 2535 to either Case Plaintiff status Date Offense Refill Rocks Pay (Mil. Tons) OR (Mil. Baht) Sor Vor 4/2559 8/7/2015 Department of 31.52 4,047 Pending the Supreme Court Consideration
Slide 39: End of Presentation Q&A Thank You
End of Presentation Q&A Thank You
TPI Polene Public Company — 9M 2023 Earnings Presentation on 6ix