Thai Oil Public Co. Ltd. · SET:TOP
Thai Oil Public — Q3 2022 Earnings Presentation
53 slides from Thai Oil Public's earnings presentation, Nov 18, 2022
Slide 1: Q3/22 Analyst Presentation
Thai Oil Public Company Limited Q3/22 Analyst Presentation 18 Nov 2022 Time : 10:00 - 12:00 hrs. 1
Slide 2: Disclaimer
2 Disclaimer 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. Some statements made
Slide 3: Presentation Agenda (Q3/22)
3 Presentation Agenda (Q3/22) KEY HIGHLIGHTS PERFORMANCE ANALYSIS OUTLOOK FINAL REMARKS
Slide 4: Positive Net Profit in Q3'22
Positive Net Profit in Q3’22 4 From Normalized GRM and Stock Loss Key Highlights Performance Outlook Final Remark Key Market Highlights Key Business Highlights Financial Performance Strategy - 3Vs Key Events A Market Factors B Decline in Net Profit from 2 Major Factors Slower Demand Growth on Recess
Slide 5: Q3 & 9M/22 Key Performance Highlights
5 Q3 & 9M/22 Key Performance Highlights Softer GRM Amid Strong Contribution from Aromatics & LAB, and Lube Market Highlight Contribution ($/bbl) QoQ Dubai declined from $113.2/bbl to $90.9/bbl Dubai ($/bbl) (ending price) YoY Dubai rose from $72.6/bbl to $90.9/bbl • Concerns over global economic slo
Slide 6: Q3 & 9M/22 Key Business Highlights
6 Q3 & 9M/22 Key Business Highlights Key Highlights Performance Outlook Final Remark Key Market Highlights Key Business Highlights Financial Performance Strategy - 3Vs Key Events Key Business Highlight Operational Commercial Financial • High and reliable refinery production to fulfill • Capture high
Slide 7: Q3 & 9M/22 Financial Performance
7 Q3 & 9M/22 Financial Performance Key Highlights Performance Outlook Final Remark Key Market Highlights Key Business Highlights Financial Performance Strategy - 3Vs Key Events TOP Group Net Profit Net Profit Contributions* Unit : Million Baht (MB) Q2/22 Q3/22 9M/21 9M/22 25,327 MB 12 MB 7,545 MB 32
Slide 8: Achievement: 3Vs Strategy
8 Achievement: 3Vs Strategy Key Highlights Performance Outlook Final Remark Key Market Highlights Key Business Highlights Financial Performance Strategy - 3Vs Key Events Value Maximization Value Enhancement Value Diversification Integrated Crude to Chemical Integrated Value Chain Mgmt. CFP • Reposit
Slide 9: Key Events
9 Key Events Key Highlights Performance Outlook Final Remark Key Market Highlights Key Business Highlights Financial Performance Strategy - 3Vs Key Events Awards, Recognitions, and ESG Regional Award and 3 National Awards Quality Persons of The Year 2022 from Alpha Southeast Asia Magazine in the cat
Slide 10: Presentation Agenda (Q3/22)
10 Presentation Agenda (Q3/22) KEY HIGHLIGHTS PERFORMANCE ANALYSIS OUTLOOK FINAL REMARKS
Slide 11: Refinery: High & Reliable Utilization
Refinery: High & Reliable Utilization 11 To Capture Strong Domestic Demand Key Highlights Performance Outlook Final Remark Refinery Aromatic & LAB Base Oil GIM Power Olefin All business F/S & others TOP/ Domestic Refinery Utilization Rate Domestic Oil Demand Unit: % Utilization Rate Sep’21 Mogas Jet
Slide 12: Refinery: Softer Mkt GRM
Refinery: Softer Mkt GRM 12 On Concerns over Global Economic Slowdown Key Highlights Performance Outlook Final Remark Refinery Aromatic & LAB Base Oil GIM Power Olefin All business F/S & others Dubai Crude Price & Key Petroleum Product Spreads Refinery Utilization 2021 2022 2021 Q2/22 Q3/22 9M/21 9M
Slide 13: Aromatics: Higher Contribution
Aromatics: Higher Contribution 13 From Improved Aromatics & Strong LAB Margins Key Highlights Performance Outlook Final Remark Refinery Aromatic & LAB Base Oil GIM Power Olefin All business F/S & others Aromatic Spreads and Margins Aromatics Production 2021 2022 2021 Q2/22 Q3/22 9M/21 9M/22 $/ton Q1
Slide 14: Base Oil: Higher Contribution
Base Oil: Higher Contribution 14 Supported by Stronger Lube and Bitumen Spread Key Highlights Performance Outlook Final Remark Refinery Aromatic & LAB Base Oil GIM Power Olefin All business F/S & others Base Oil & Bitumen Spreads & Margins Base oil Production 2021 2022 2021 Q2/22 Q3/22 9M/21 9M/22 $
Slide 15: Integrated Margin & Competitive Cash Cost
15 Integrated Margin & Competitive Cash Cost Key Highlights Performance Outlook Final Remark Refinery Aromatic & LAB Base Oil GIM Power Olefin All business F/S & others Gross Refining Margin Refinery’s Cash Cost (Unit: US$/bbl) (Unit: US$/bbl) Market GRM Accounting GRM (Market GRM + Stock G/L) Opera
Slide 16: Power: Higher Contribution
Power : Higher Contribution 16 From higher NG price Key Highlights Performance Outlook Final Remark Refinery Aromatic & LAB Base Oil GIM Power Olefin All business F/S & others Power Business Sector Equity holding in SPP (5)(6) 100% Power & Steam Sales Electricity(1) (5) TOP shareholding in GPSC decr
Slide 17: Olefins: Softening Contribution
Olefins : Softening Contribution 17 From weak Chinese demand Key Highlights Performance Outlook Final Remark Refinery Aromatic & LAB Base Oil GIM Power Olefin All business F/S & others Olefin Product Spreads TOP Investment Indonesia (TII)* Performance Polymer Spreads Monomer Spreads Net Profit (mill
Slide 18: Q3/22 Performance Breakdown
18 Q3/22 Performance Breakdown Key Highlights Performance Outlook Final Remark Refinery Aromatic & LAB Base Oil GIM Power Olefin All business F/S & others Unit : Million Baht (MB) (1) Others & Consolidated Petroleum & Lube Base Petrochemical Power (2) New Business (3) Net Profit Q2/22 26,092 (682) 3
Slide 19: Q3/22 Consolidated Financial Performance
19 Q3/22 Consolidated Financial Performance Key Highlights Performance Outlook Final Remark Refinery Aromatic & LAB Base Oil GIM Power Olefin All business F/S & others (MB) Q3/22 Q2/22 QoQ+/(-) Q3/21 YoY+/(-) 9M/22 9M/21 YoY+/(-) ) (A) (D) Sales Revenue 124,174 143,892 (19,718) 79,960 44,214 382,571
Slide 20: 9M/22 Consolidated Cash Flow
20 9M/22 Consolidated Cash Flow Key Highlights Performance Outlook Final Remark Refinery Aromatic & LAB Base Oil GIM Power Olefin All business F/S & others (Unit: MB) 9M’21 9M’22 Represent 9M’21 9M’22 Operating Cash Flow (CFO) 4,840 22,778 Investing Cash Flow (CFI) (35,415) (7,213) Net income 8,871
Slide 21: Financial Position & Financial Ratios
Q3/22 TOP Group Financial Position & 21 Financial Ratios Key Highlights Performance Outlook Final Remark Refinery Aromatic & LAB Base Oil GIM Power Olefin All business F/S & others Statements of Financial Position Consolidated Long-Term Debt as at 30 Sep 22 (Unit: million THB) Total IBD Net Debt 362
Slide 22: Presentation Agenda (Q3/22)
22 Presentation Agenda (Q3/22) KEY HIGHLIGHTS PERFORMANCE ANALYSIS OUTLOOK FINAL REMARKS
Slide 23: Slower Oil Demand Growth on Global Economic Concern
23 Slower Oil Demand Growth on Global Economic Concern Key Highlights Performance Outlook Final Remark Crude Refinery Petrochemical Lube & Bitumen Conclusion A High Inflation and China’s Dynamic Zero-COVID Policy B Slower Demand Growth on Softer GDP to Pressure Economic Growth US and EU Inflation Ra
Slide 24: Balancing Market with Uncertainties on Demand Growth and Russian Supply Loss
Balancing Market with Uncertainties on Demand Growth 24 and Russian Supply Loss Key Highlights Performance Outlook Final Remark Crude Refinery Petrochemical Lube & Bitumen Conclusion A Limited Increase in OPEC Production amid Low OPEC Spare Balancing Market with Uncertainties on Demand Growth Capaci
Slide 25: Normalizing Refinery Margin to Slightly Above Pre-Covid Level
Normalizing Refinery Margin to Slightly Above 25 Pre-Covid Level Key Highlights Performance Outlook Final Remark Crude Refinery Petrochemical Lube & Bitumen Conclusion Singapore Cracking GRM ($/BBL) Avg. 2017: $7.1/BBL Avg. 2018: $5.9/BBL Avg. 2019: $3.7/BBL Avg. 2020: $0.4/BBL Avg. 2021: $3.4/BBL 2
Slide 26: High Demand Growth to Offset New Capacity Addition in 2023
High Demand Growth to Offset New Capacity Addition 26 in 2023 Key Highlights Performance Outlook Final Remark Crude Refinery Petrochemical Lube & Bitumen Conclusion Key Projects : New Addition AP/ME Effective CDU Addition VS Additional Demand Country Company CDU (KBD) Start-up Saudi Arabia Jizan1 De
Slide 27: Gasoline and Jet/Kero Markets
Gasoline : Steady Demand amid Low Inventory 27 Jet/Kero : Resuming Air Travelling Demand Key Highlights Performance Outlook Final Remark Crude Refinery Petrochemical Lube & Bitumen Conclusion Gasoline Market Jet/Kero Market 1 Steady Demand Growth, Pressured by Recession Fears especially in U.S. 1 Hi
Slide 28: Gasoil and Fuel Oil Markets
Gasoil : Steady Demand and Lower Russian Supply 28 Fuel Oil : Higher Demand and Lower Russian Supply Key Highlights Performance Outlook Final Remark Crude Refinery Petrochemical Lube & Bitumen Conclusion Gasoil Market Fuel Oil Market 1 Steadily High Demand following 2 Low Inventories with Stock Belo
Slide 29: Recovering Domestic Gasoline, Gasoil, and Jet Demand in 2023
Recovering Domestic Gasoline, Gasoil, and Jet Demand 29 in 2023 while Fuel Oil Slowdown Key Highlights Performance Outlook Final Remark Crude Refinery Petrochemical Lube & Bitumen Conclusion A Higher Gasoline Demand from Higher Travel Mobility B Higher Jet Demand from Fully Opening the Country Gasol
Slide 30: Challenging Aromatics Market from Over Built Capacity
30 Challenging Aromatics Market from Over Built Capacity Key Highlights Performance Outlook Final Remark Crude Refinery Petrochemical Lube & Bitumen Conclusion A High Capacity Start-up to Pressure PX Market amid Improved B High BZ Capacity Addition to Limit Market amid Stronger Demand Textile Demand
Slide 31: Soft Olefins Market from Continuing Large Capacity Addition
Soft Olefins Market from Continuing Large Capacity Addition and 31 Economic Uncertainties amid Recovering Demand Growth Key Highlights Performance Outlook Final Remark Crude Refinery Petrochemical Lube & Bitumen Conclusion A Large HDPE Capacity Start-up, with Improving Demand from B Continuing PP Ca
Slide 32: Softer Base Oil Market on More Supply from New Capacity
Softer Base Oil Market on More Supply from New Capacity 32 and Higher Feedstock Price Key Highlights Performance Outlook Final Remark Crude Refinery Petrochemical Lube & Bitumen Conclusion A Pressured by Gr.2/3 Capacity Addition but Permanent Closure Of Gr.1 B Higher Feedstock Price to Pressure Bitu
Slide 33: 2023 Outlook Conclusion
33 2023 Outlook Conclusion (vs. 2022) Key Highlights Performance Outlook Final Remark Crude Refinery Petrochemical Lube & Bitumen Conclusion Balancing Supply Crude Oil Market with Uncertainties on Demand Growth and Crude Oil Russian Supply Loss Refinery Normalizing Refinery Margin to Slightly Above
Slide 34: Presentation Agenda (Q3/22)
34 Presentation Agenda (Q3/22) KEY HIGHLIGHTS PERFORMANCE ANALYSIS OUTLOOK FINAL REMARKS
Slide 35: Looking Forward
35 Looking Forward Key Highlights Performance Outlook Final Remark Normalized Refinery Margin Strong Refining Margins Period Short Term VS Long Term but Still above Pre-Covid 2023 2024-2030 Coinciding with CFP’s completion Crude Oil • Easing supply tightness on more OPEC and Non-OPEC • Balancing Sup
Slide 36: APPENDIX
APPENDIX • Dividend • CAPEX • Financial Performance • Optimised & Flexible Operations…Superior Performance • World GRM / Inventories • Thailand petroleum demand by products 36
Slide 37: Dividend Payment
Dividend 37 Dividend Payment Dividend Policy : Not less than 25% of consolidated net profit after deducting reserves, subject to cash flow and investment plan Unit : THB/share EPSR 2H dividend 1H dividend Year Dividend *** Annual DPS 1.80 3.50 3.50 4.50 2.75 2.55 2.00 3.30 2.70 2.30 1.16 2.70 4.50 5
Slide 38: TOP Group Strategic Investment Plan
CAPEX 38 TOP Group Strategic Investment Plan CAPEX Plan (Unit US$ million) Updated as of Oct 2022 Estimated Budgeting for Actual Investment Plan Project 9M/22 Q4/2022 - 2025 CFP project * 633 644 Total Ongoing CAPEX 35 132 Reliability, Efficiency and Flexibility Improvement 7 46 Infrastructure Impro
Slide 39: Q3/22 - Financial Performance
Financial Performance 39 Q3/22 - Financial Performance TOP Group Net Profit Gross Refining Margin - GRM Unit : Million Baht (MB) $/bbl Q2/22 Q3/22 9M/21 9M/22 Q2/22 Q3/22 9M/21 9M/22 Market GRM 25.1 6.7 0.9 12.9 25,327 MB 12 MB 7,545 MB 32,510 MB Stock 7.8 (9.6) 5.4 4.5 Gain/(Loss) Gain on GPSC shar
Slide 40: Optimized & Flexible Operations
Operations 40 Optimized & Flexible Operations Superior Performance Thai Oil is able to diversify its type of crude intake and product outputs to maximize demand and margin Crude Assays based on Sources of Product Reference Domestic demand for TOP configuration* Crude output Price petroleum products*
Slide 41: Asian Margin Vs. US-EU margin
World GRM 41 Asian Margin Vs. US-EU margin Total Capacity: 3.45 MBD Total Capacity: 17.9 MBD Total Capacity: 14.4 MBD 87.4% 65.8% 75.8%
Slide 42: Global Crude Oil Inventories
Inventories 42 Global Crude Oil Inventories
Slide 43: Global Gasoline Inventories
Inventories 43 Global Gasoline Inventories
Slide 44: Global Middle Distillate Inventories
Inventories 44 Global Middle Distillate Inventories
Slide 45: Global Fuel Oil Inventories
Inventories 45 Global Fuel Oil Inventories
Slide 46: China's Refined Product Exports
46 China’s Refined Product Exports
Slide 47: Domestic LPG Demand
Thailand Petroleum Demand by Products -47- Domestic LPG Demand Thailand LPG Demand LPG Demand Highlight KT/Day • In 9M’22, LPG demand increased by 8.6% YoY mainly following the increase in automobile and petrochemical sectors by 37.8% and 8.6% YoY, respectively. It is resulted from the Russian-Ukrai
Slide 48: Domestic Gasoline/Gasohol Demand
Thailand Petroleum Demand by Products -48- Domestic Gasoline/Gasohol Demand Thailand Gasoline/Gasohol Demand GASOLINE/GASOHOL Demand Highlight MML/Day • In 9M’22, Gasoline demand was increased by 5.4% YoY to an average of 29.9 MML/day. The demand was supported by higher transportation activities. In
Slide 49: Domestic Jet Demand
Thailand Petroleum Demand by Products -49- Domestic Jet Demand Thailand JET Demand JET Demand Highlight MML/Day • In 9M’22, Jet consumption increased by 80.1% YoY. The demand was recovered from fully opening the country by canceling of Test & Go program for fully vaccinated travelers since 1 May’22.
Slide 50: Domestic Gasoil and NGV Demand
Thailand Petroleum Demand by Products -50- Domestic Gasoil and NGV Demand Thailand Gasoil Demand Gasoil Demand Highlight MML/Day • In 9M’22, Gasoil demand increased by 19.0% YoY. The demand was supported by the improve of economic activities and also supported by government that capped diesel price
Slide 51: Domestic Fuel Oil Demand
Thailand Petroleum Demand by Products -51- Domestic Fuel Oil Demand Thailand Fuel Oil Demand Fuel Oil Demand Highlight MML/Day • In 9M’22, Fuel Oil consumption rose by 19.4% YoY, as the demand in the transportation sector, which accounted for 56.0% of total Fuel Oil demand, rose by 19.0% YoY, align
Slide 52: Thank You
Empowering Human Life Thank You Through Sustainable Energy and Chemicals Any queries, please contact: at email: ir@thaioilgroup.com Tel: 662-797-2999 / 662-797-2961 Fax: 662-797-2976 52
Slide 53: We Appreciate Your Feedback
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