Bangchak Corporation Plc.
Analyst Meeting FY2018
February 25th, 2019
Bangchak Corporation Plc.
FY2018 Performance Summary
BCP Group Portfolios – FY2018 Key Takeaways
Bangchak Corporation Plc. 3
Refinery & Trading
• 2018 Crude Run meet the budget (102 KBD) and if exclude TAM days, average daily Crude Run was historical high (115 KBD)
• GRM was affected by lower UNL95 spread and lower crude run
• 1,489 MB Inventory Loss
Bio-Based ProductGreen Power Plant
Natural Resource
• Successfully recapitalize OKEA as associated company and acquired assets in Draugen & Gjøa on 30 Nov’18
• Performance contribution from Nidodiscontinued from Q3/18 onwards, after the share divestment
• Ethanol sales volume grew from full year performance realized from KSL
• Biodiesel sales volume increased from B7 mixing portion throughout the year
• Biodiesel gross margin recovered from last year, but still affected by the low price level
Capacity & Regional Expansion
• Additional 14 MW COD of Solar Power Plant
• Sold 19.3 MW power plant in Japan with 793 MB profit before tax
• Total electricity sales marginally grew 2%
Marketing
• Full year Market Share at 15.8% for 2018
• Retail market grow 5% YoY, but Industrial market soften due mainly to limited supply during TAM
• Marketing Margin still in a healthy level, backed by various high margin products
BCP Group Performance – 2018 Key Takeaways
EBITDA FY Comparison
Bangchak Corporation Plc. 4
Unit: THB Million
*Operating EBITDA = EBITDA exclude inventory gain/loss, FX Fwd, one-time items
5,608
2,463
0
2,000
4,000
6,000
2017 2018
Unit: THB Million
Net Profit 1/
1/ Profit attributable to owners of the Company
Unit: THB/Share
EPS
7,5966,268
3,9285,330
2,301
2,097
2,177
2,194
2,846
2,695
3,569
3,468
529
754
692
779
286
286
117
43
13,421
11,963
10,201
11,532
2017 2018
Refinery
Marketing
Green Power Plant
Bio-Based ProductNatural Resource
Refinery
Marketing
Green Power Plant
Bio-Based ProductNatural Resource
OperatingAccounting
4.07 1.79
Operating EBITDA stay the same level as 2017
Despite 2018 refinery’s 45 days turnaround maintenance
OperatingAccounting
Factors affecting 2018 Profit
- Inventory Loss 1,594 MB (include LCM)
- Oil Hedging Loss 442 MB
- Impairment Loss 441 MB
0%
50%
100%
150%
200%
0.5 1.5 2.5 3.5 4.5 5.5
EBITDA Performance - BCP Group
Bangchak Corporation Plc. 5
Target100%
Solar Power3,569
Marketing2,177
Refinery3,928
Biofuel692
E&P117
FY2018 Performance Compare to Target by Business Unit
Accounting EBITDA 10,201 Million Baht
Unit: THB Million
39%21%
35%
7%
1%
BCP Group Portfolios
Bangchak Corporation Plc. 6
Refinery
Marketing
Green Power Plant
Bio-basedProducts
Natural Resources& New Businesses
109
67
119 114 111102
Q1/18 Q2/18 Q3/18 Q4/18 2017 2018
Production ProfileActual Crude Run Unit: KBD
(TAM)
Refinery Business – Strong operation despite TAM
Bangchak Corporation Plc. 7
(TAM)
31% 29% 28% 24% 28% 23%
69% 71% 72% 76% 72% 77%
Q1/18 Q2/18 Q3/18 Q4/18 . 2017 2018
9% 12% 7% 12% 13% 10%
3% 3%5% 3% 2% 3%
53% 53% 53% 53% 51% 53%
12% 12% 14% 11% 12% 12%
21% 17% 19% 18% 19% 19%
3% 3% 2% 3% 3% 3%
Q1/18 Q2/18 Q3/18 Q4/18 . 2017 2018TAM
Product Yield
LPG
Gasoline
Jet
Diesel
Fuel OilUCO
Maximize high value product
Crude Sourcing
Diversify Crude Sourcing: Satisfactory GRM regardless of the changing crude sources
Domestic
Import
TAM
2018 - Record high monthly crude run 123 KBD in March’18- 85% Full Year Utilization rate, despite 45 days TAM in Q2
crude run maximization tested and proven in preparation for capacity expansion project
Operation Excellence
115*
119*
*Normalized crude run excluding TAM days
*Normalized crude run excluding TAM days
• 95% Utilization rate on nameplate capacity
• 105% Utilization rate on full complex refinery capacity
6.718.81 7.59 5.94 6.38 7.10
-0.12-0.39 -0.21 -0.40
0.25
-0.27
-0.22
4.39
0.66
-7.25
0.60
-1.23
Q1/18 Q2/18 Q3/18 Q4/18 2017 2018
6.37 12.82 8.05 (1.72) 7.23 5.61
Refinery Business – Operation still strong, affected by oil price volatility
8
44
54
64
74
Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18
-8
-3
2
7
12
17
Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 Q3/18 Q4/18
Refinery EBITDAUnit: THB MillionUnit: THB Million
GRM Performance Unit: $/BBL
Crude Price & Crack Spreads ($/BBL)
DB
DTD
GO/DB
UNL95/DB
Inventory G/L
Oil Hedging
Market GRM
1,2
79
1,9
29
2,1
40
-1,4
19
7,5
96
3,9
28
1,3
48
97
7
1,9
27
1,0
77
6,2
68
5,3
30
Q1/18 Q2/18 Q3/18 Q4/18 2017 2018
Accounting Operating
IK/DB
FO/DB
* Operating EBITDA : exclude Inventory gain/loss, One-time items, Gain/loss from FX forward contracts
EBITDA soften mainly from:
• Weaker GRM from a drop in UNL95 spread and higher crude cost
• Lower crude run during 45 days TAM in Q2/18
• 1,489 MB Inventory Loss in 2018, compared to 834 MB Inventory Gain in 2017
BCP Trading EBITDA 76 MB increased from higher transactions after tapping to new products and markets
Share of profit from Bongkot Marine Service 39 MB
2018 – Strong operation, with cushion from supporting businesses
Distribution channel – Retail market sales continues to grow as our main priority
9
259
284
307
334 342
186 179190 184
167
47 51
86
5850
92 93
82
112 111
0
50
100
150
200
250
300
350Unit: Million Litre / Month (monthly AVG in the quarter)
Total Sales Volume
Retail Market
IndustrialMarket
Wholesales
Exports(FO & UCO)
Total Sales Volume
Unit: % Portion of total sales volume in 2018
8%
25%
14%
RetailMarket
IndustrialMarket
Wholesales
Export
Marketing Business
3,820
2,196
7061,121
4,020
1,925
6221,026
0
1,000
2,000
3,000
4,000
5,000
Retail Industrial Wholesales Export
2017
2018
Unit: Million Litre
(+5%)
(retail market portion
+4% from 2017)
53%
Marketing Performance – Retail market is the main priority
Bangchak Corporation Plc. 10
Marketing EBITDA
Unit: THB Million
Retail sales volume grows 5% YoY from customer base expansion and service station sales push, but Industrial sales volume reduced 12% YoY from the intensified competition and limited stock during TAM
Total Marketing Margin remain at the same level as in 2017, although there was a diesel price cap during the middle of the year, but crude oil price dropped during Q4/18 helped increasing margin
BCR revenue growth from branches expansion, but EBITDA still negative from high SG&A expense
2018 – Satisfied Margin, retail market prioritized
Net Marketing MarginUnit: Baht/Litre
1.030.93
0.83
1.050.97 0.96
0.440.35 0.40 0.46 0.43 0.41
Q1/18 Q2/18 Q3/18 Q4/18 2017 2018
0.83 0.75 0.70 0.85 0.77 0.78
73
5
50
9
46
8
46
5
2,3
59
2,2
54
-58
-77
Q1/18 Q2/18 Q3/18 Q4/18 2017 2018
Oil Business Non-oil Businesses
Net Retail Margin Net Industrial Margin
(include elimination)
43.1%41.1%
15.1%15.0% 15.1%
15.4%
15.8%
14.5%
12.7%12.8%
12.6%
10.0%
11.0%
12.0%
13.0%
14.0%
15.0%
16.0%
17.0%
18.0%
19.0%
20.0%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
50.0%
2014 2015 2016 2017 2018
444 457 460 499 527
392
436
479
510 496
416
450
464
451 446
0
200
400
600
800
1000
1200
1400
1600
1800
2000
200
300
400
500
2014 2015 2016 2017 2018
Marketing Network – Increasing Market Share & Thruput per station
Bangchak Corporation Plc. 11
Market Share (Retail Channel)
*AVG Major Oil : PTT, ESSO, SHELL, CALTEX
Thruput per station (K.Litre / Mo)
AVG Major Oil(excl. BCP)
Number of standard stations
BCP Thruput for standard stations continues to surpass major oil’s
Historical Market Share (Retail Channel)
BCP Standard
Jan-Dec’17 Jan-Dec’18 change
41.5% 41.1%
15.4% 15.8%
12.4% 12.7%
13.0% 12.6%
9.5% 9.4%
4.6% 4.3%
1.8% 1.7%
1.6% 1.7%
0.1% 0.6%
Bangchak Service Station – Expansion Progression in 2018
Bangchak Corporation Plc. 12
Standard Type 555 sites
COOP Type620 sites
*COOP Type is small sized service station owned by farmers cooperatives
(≈75% of Retail Sales Volume)
(≈25% of Retail Sales Volume)
+74New ServiceStations
service stations as of Dec 20181,175
523 branches
Dec’18
Dec’18
45 stores
+149 stores
+13 stores
R&M PerformanceRefinery and Marketing business to extract benefit of the value chain
Bangchak Corporation Plc. 13
Refinery Business earning was volatile due to market conditions and Turnaround maintenance (TAM)
Marketing Business Captures a Demand Surge During Low Oil Price Environment
R&M as a fully integrated model
profit can be optimized through business cycle
8.345.88 6.96
9.05
5.99 6.38 7.10
3.31
2.68
3.47
3.53
3.53 3.603.84
2012 2013 2014 2015 2016 2017 2018
Net MKM
Market GRM
Unit: $/BBL
Normalize Integrated Margin
$11.66 $ 8.56 $ 10.43 $ 12.58 $ 9.52 $ 9.98 $ 10.94
BCP Group Portfolios
Bangchak Corporation Plc. 14
Refinery
Marketing
Green Power Plant
Bio-basedProducts
Natural Resources& New Businesses
Power Plant Business – BCPG
Bangchak Corporation Plc. 15
130 130 130 139 13930 30 34 34 15
158 158 158 158158
14 14 14 1414
Dec'17 Mar'18 Jun'18 Sep'18 Dec'18
Operating Capacity (MWac)
Solar
Solar
Geothermal
Wind
66
4
79
3 1,5
42
57
0
2,8
46 3
,56
9
Q1/18 Q2/18 Q3/18 Q4/18 2017 2018
Green Power Plant EBITDA
Unit: THB Million
332 332 336 345 326
66 67 64 73
265 270
9 15 14 4
41 42
1Q/18 2Q/18 3Q/18 4Q/18 2017 2018
JP
TH75.2 81.6 78.1 76.9
306.4 311.8Electricity Sales
Unit: Million kWh
Solar Electricity Sales +2% YoY:
• Increase from COD of War Veteran Organization Solar project (9 MW) and Gotemba project (4 MW)
• Sold Nikaho & Nagi project in Sep’18 (total 19 MW)
Gain from 2 power plant sold to an infrastructure fund in JP: 793 MB (before tax)
Share of profit from Geothermal power plant : 164 MB
Share of profit from Wind power plant : 39 MB
SG&A expense reduced 17% YoY mainly from lower financial advisory expense
35
35 46
32 5
5
14
9
73
68
66 74
24
9 28
1
1Q/18 2Q/18 3Q/18 4Q/18 2017 2018
Ethanol B100
Bio-Based Product Business – BBGI
Bangchak Corporation Plc. 16
Bio-Based Product EBITDA
Biodiesel Performance
Sales volume growth 13% from full year B7 implementation
Gross margin better than 2017, but still pressured by price situation: 2018 Inventory loss 83 MB vs 224 MB loss in 2017, as CPO & B100 price situation stabilize in 1H18
Ethanol Performance
Sales volume growth from full year performance realized from KSL-GI
Gross margin of cassava based ethanol decreased, while margin of molasses based ethanol increased
Unit: THB Million
30
4
17
1
15
1 66
52
9
69
2
30
0
18
5
17
3
12
1
75
4
77
9
Q1/18 Q2/18 Q3/18 Q4/18 2017 2018
Accounting Operating
Biofuel Sales Volume
Unit: million litres
B5-B7B7
KGI performance included 2 mths
2018 – Steady & Strong, despite B100 price drop
20
22
24
26
28
30
32
34
36
Jan-1
7
Feb-1
7
Mar-
17
Apr-
17
May-1
7
Jun-1
7
Jul-17
Aug-1
7
Sep-1
7
Oct
-17
Nov-1
7
Dec-
17
Jan-1
8
Feb-1
8
Mar-
18
Apr-
18
May-1
8
Jun-1
8
Jul-18
Aug-1
8
Sep-1
8
Oct
-18
Nov-1
8
Dec-
18
Ethanol B100
Biofuel Price Movement Unit: Baht / litres
Source: EPPO
Full year KGI performance
realized
* Operating EBITDA : exclude Inventory gain/loss, One-time items, Gain/loss from FX forward contracts
Natural Resource Business – Petroleum Exploration & Production
Bangchak Corporation Plc. 17
OKEA AS
performance realized from 1 Dec’18 onwards, BCP currently hold 49.33% of OKEA shares
Nido Petroleum
Operating assets (Galoc) sold in July 2018
Short list buyers for non-operating / developing assets
2018 – OKEA acquisition & Galoc divestment completed
Petroleum E&P EBITDA
Unit: THB Million
68 3
6
-81
94
28
6
11
7
Q1/18 Q2/18 Q3/18 Q4/18 2017 2018
49%35%
16%Minor Shareholder
GjoaIvar Aasen
Yme
0.554% 15% 55% 44.56% 12%
DraugenGrevling
ProducingProducing Developing Developing Producing
Successfully acquired interests inin 30 Nov’18
FY2018 Financial Performance
FY2018 Highlights
Bangchak Corporation Plc. 19
• Bangchak Refinery TAM 2018 Completed as planned. (period between 30th April – 13th June: 45 Days)
• Bond Issuance 4,000 MB with 2-7 years maturity and coupon of 2.13 – 3.42% p.a. in Aug 2018
• Bond Issuance 7,000 MB with 10 years maturity and coupon of 4.04% p.a. in Dec 2018
• Established subsidiaries: BCPR Co., Ltd. (in Thailand) and BCPR Pte. Ltd. (in Singapore) to subscribe 90% of the increased capital of OKEA, with total investment approx. 3,760 MB, to acquire interests in DraugenField and Gjøa Field in Norway
• Established new subsidiaries in Thailand to invest in new Start-ups, a total of 4 new companies 1. BCV Bio-based Co., Ltd. 3. BCV Innovation Co., Ltd.2. BCV Energy Co., Ltd. 4. BCV Partnership Co., Ltd.
• Divestment of Galoc oil Field to Tamarind Galoc Pte. Ltd., valued at USD 20 million (approximately 660 MB)
BCP Consolidated: Nido Assets Impairment 412 MB
Company Only: BCPE Investment Impairment 271 MB
FY2018 Highlights
Bangchak Corporation Plc. 20
• The Acquisition of ordinary share in Lomligor Co., Ltd. Wind Power Plant Project with a capacity 8.97 MW (Total investment approx. 825 MB)
• COD of 2 solar power plant project, a co-project with the War Veterans Organization (WVO)
Total contract capacity 8.94 MW (Saraburi province 5.00 MW and Kanchanaburi province 3.94 MW)
• BCPG sold 2 solar power plant projects in japan (Nikaho, Nagi) into an infrastructure fund
Income from the sales of assets 3,046 MB
Profit from the sales of assets before tax 793 MB
• Finalization of the valuation of net assets of BCPG’s investment in Star Energy Group Holdings Pte. Ltd. which resulted in restatement of 2017 consolidated financial statement:
Asset : Investment in associated companies 242 MB
Equity : Retained Earnings 170 MB
Non-controlling interest 72 MB
• BCPR Pte. Ltd., completely subscribed for newly issued shares of OKEA AS at the total investment amount of NOK 939 million or approximately THB 3,618 million. The shares allotted to the company is equal to 49.33% of total registered shares in OKEA.
Statement of Income - Consolidated
Bangchak Corporation Plc. 21
Remark:Statement of Income FY2017 FY2018
(Restated)
Revenue 172,138 192,025
Cost of goods sold (158,596) (180,594)
Gross Profit 13,543 11,431
Investment income and dividend income 156 55
Other income 1,085 1,260
Selling and administrative expenses (7,212) (7,421)
Gain (loss) from oil hedging contract 366 (442)
Gain (loss) from FX forward contracts (225) 162
Gain (loss) on foreign exchange 889 415
Loss from impairment of assets (1,518) (441)
Share of profit of associate and JV 573 254
EBIT 7,656 5,273
Finance costs (1,452) (1,545)
Income tax expense (41) (493)
Profit for the period 6,163 3,235
Owners of the Company 5,608 2,463
Non-controlling interests 555 772
Earnings per share (Baht per Share) 4.07 1.79
(Unit: MB)
Oil hedging, FX hedging, FX Gain/Loss
Net gain resulted from managing oil price & FX risks
Revenue +12% YoY
- Refinery & Marketing : Higher average selling price per unit of finished product
- BCPT: Higher oil trading sales volume and selling price per unit
- Bio-based: Realized full year revenue from KSL Green Innovation Co.,Ltd. following business amalgamation in Q4/17
Impairment loss 441 MB
Mainly from exploration and drilling inventories impairment of Nido Petroleum 412 MB
Other Income 1,260 MB
- BCPG: Gain from selling 2 power plants into Infrastructure fund of 793 MB and insurance compensation for the damages from typhoons in Japan of 104 MB
- E&P: Realized profit from the provision of working capital settlement following the share disposal in Nido Production (Galoc) Pty. Ltd. of 78 MB
Gross Profit -16% YoY
- Inventory Loss 1,594 MB (including LCM 696 MB) in 2018, meanwhile inventory gain 652 MB in 2017
Statement of Income - Consolidated
Bangchak Corporation Plc. 22
Remark:
Share of profit of associate and JV 254 MB
- Star Energy Group Holdings Pte. Ltd 164 MB
- Petrowind Energy Inc. 39 MB
- Bongkot Marine Services 39 MB
- Ubon Bioethanol Plc. 14 MB
- OKEA AS -3 MB
*In 2017, recorded gain on purchase from Petrowind Energy Inc. 362 MB
Finance Costs (+6% YoY)
- Subsidiaries loan draw down 1,629 MB
Unit: MB(Unit: MB)
FY2018 Net Profit
The company groups’ 2018 performance declined significantly compared to 2017, as the Refinery business was affected by the year round global oil price fluctuation, especially in the last quarter which oil price plunged drastically.
(Unit: MB)(Unit: MB)(Unit: MB)
Income Tax 493 MB
- Income tax on BCPG’s profit from assets sale into infrastructure fund 136 MB
- In 2017 the company realized tax refund in the amount of 897 MB
Statement of Income FY2017 FY2018
(Restated)
Revenue 172,138 192,025
Cost of goods sold (158,596) (180,594)
Gross Profit 13,543 11,431
Investment income and dividend income 156 55
Other income 1,085 1,260
Selling and administrative expenses (7,212) (7,421)
Gain (loss) from oil hedging contract 366 (442)
Gain (loss) from FX forward contracts (225) 162
Gain (loss) on foreign exchange 889 415
Loss from impairment of assets (1,518) (441)
Share of profit of associate and JV 573 254
EBIT 7,656 5,273
Finance costs (1,452) (1,545)
Income tax expense (41) (493)
Profit for the period 6,163 3,235
Owners of the Company 5,608 2,463
Non-controlling interests 555 772
Earnings per share (Baht per Share) 4.07 1.79
(Unit: MB)
Financial Position - Consolidated
Bangchak Corporation Plc. 23
Unit: THB Million
Current Liabilities
Long Term Debt
Total Equity
Other Non Current Liabilities
(Including current portion of L/T debt)
51,890 49,538
3,470 3,083
36,857 45,460
7,5897,603
10,0166,680
4,0465,004
31 DEC 17 31 DEC 18
Liabilities & Equity
31 Dec 17 31 Dec 18
29,528 30,896
48,049 48,877
2,7343,680
15,72015,135
7,511 6,969
10,32511,813
31 DEC 17 31 DEC 18
Cash and Equivalents & Short term Investment
Other Current Assets
Inventory
PP&E
Other Non Current Assets
117,369
Assets
31 Dec 17 31 Dec 18
Account Receivable
113,869 113,869
Account Payable
Short term loan
117,396
Financial Position - Consolidated
Bangchak Corporation Plc. 24
2,734 3,680
15,720 15,135
7,511 6,969
10,325 11,813
Cash and Equivalents & ST Investment 1,445 MB
mainly from: bond issuance, net profit
Other Current Asset 946 MB mainly from oil fund subsidy
Inventory 585 MB mainly from inventory volume decrease
Account Receivables 542 MB
from lower oil products sales volume and average selling price per litre in Dec’18 compared to Dec’17
Cash and Equivalents & Short term Investment
Other Current Assets
Inventory
36,291
Current Assets
31 Dec 17 31 Dec 18
Account Receivable
37,596
7,589 7,603
10,0166,680
4,046
5,004
31 DEC 17 31 DEC 1831 Dec 17 31 Dec 18
21,65119,288
Other Current Liabilities
Account Payable
Short term loan
Current Liabilities
Account Payable 3,336 MB
Short Term loans 958 MB
mainly from BBGI 819 MB, BCPG 161 MB
31 Dec 17 31 Dec 18
CrudeVol. 3.5 MBBL
Price ≈ 64 $/BBL
Vol. 3.2 MBBL
Price ≈ 70 $/BBL
ProductVol. 312 ML
Price ≈ 16 Baht/L
Vol. 281 ML
Price ≈ 19 Baht/L
Financial Position - Consolidated
Bangchak Corporation Plc. 25
29,528 30,896
48,049 48,877
PP&E 828 MB
Increased mainly from refinery, marketing and power plant assets8,270 MB
PP&E sold in the amount of 2,605 MB, mainly from BCPG power plants sold to infrastructure fund
Depreciation for FY2018 of 4,455 MB
PP&E
Other NonCurrent Assets
77,578
Non-Current Assets
31 Dec 17 31 Dec 18
79,773
3,470 3,083
36,85745,460
31 DEC 17 SEP 1831 Dec 17 31 Dec 18
40,327
48,543
Long Term Debt
Other Non CurrentLiabilities
(Including current portion of L/T debt)
Long-term debt 8,603 MB
BCP Bond issuance 11,000 MB
BCPG & BBGI loan drawdown 1,629 MB
Loan repayment 4,231 MB
Non-Current Liabilities
Other Non Current Assets 1,367 MB
Increased mainly from the investment in OKEA AS in the amount of 112.41 M.USD (approximately 3,618 MB)
Decrease from Change in net fair value of available-for-sale investment (LAC) 2,590 MB
Financial Position - Consolidated
Bangchak Corporation Plc. 26
6,410 6,823
27,814 27,607
15,254 15,273
2,411
31 DEC 17 31 DEC 18
Equities decreased 2,352 MB (-5% YoY) mainly from
Retained Earnings 207 MB from
• FY2018 Net Profit of 2,463 MB
• Dividend paid 2,685 MB
Other component of equity 2,576 MB mainly from
• Net fair value change in available-for-sale investment (LAC) of -2,590 MB
Equity
31 Dec 17 31 Dec 18
51,89049,538
Other Components
Non-controlling Interests
Retained Earnings
Paid up capital, Share premium
and capital surplus
-165
Cash Flow - Consolidated
Bangchak Corporation Plc. 27
Beginning Cash10,106 MB
Change in Cash1,575 MB
Ending Cash11,551 MB
FX adjustment(131) MB
FY2018 Sources and Uses of Cash
Unit: THB Million
10,440
3,360
13,664
5,849
3,878
7,705
3,822
3,091 1,451 1,130
Cash From Operation
(CFO)
Funding
27,983
Sources of Cash Uses of Cash
26,407
Change in Working Capital
Debt Service - Repayment
Investment in PPE
Investment in subsidiaries, associated companies
Tax PaidSelling of PPE, Selling of investments and others
Dividend Paid
Investment in intangible assets and others
Going Forward
10,201
2018 2019
2019 Performance Target
Bangchak Corporation Plc. 29
EBITDA +30%Marketing
• Retail sales volume +9% & Maintain 2nd rank market share
• Estimated Marketing Margin at 75-85 st./litre
• Strengthen & diversify Non-oil Business
Refinery & Trading
• Crude run at 115 KBD and flexible crude mixed
• GRM to be closely managed regarding oil price & crack spread situation
• BCPT to increase trading volume to 35 MBBL
Power Plant
• Additional Capacity in pipeline
• Open for profitable deals in selling power plants to infrastructure fund
• Investment portfolio selection strategy
Bio-Based Product
• Ethanol Capacity increase +30%
• Raw material & Inventory management to adapt with price situation
Natural Resources
• Realize full year share of profit from OKEA (capacity net to BCP 10 KBD) with lower cash cost at ≈ 20 $/BBL
Accounting EBITDA (unit : THB million)
Refinery – 2019 Business Highlight
Bangchak Corporation Plc. 30
Trading Business
6.1
15.3
35
2017 2018 2019 (F)
Oil Trading VolumeUnit: MBBL
Expand coverage to offer more product varieties
Derivatives Trading
2019 crude run target at 115 KBD
Refinery Business
Operation Excellence
• 19% yield in UNL alleviate impact from collapse in its crack spread
• 2H/19 GRM to pick up due to IMO
• Max middle distillate to manage GRM
15%
66%
19%
BCP
Refinery Product Yield Comparison
Gasoline
Middle Distillates
Others
Optimization for oil price & margin situation
50
55
60
65
70
75
80
Q4/17 Q1/18 Q2/18 Q3/18 Q4/18
DB
DTD
WTI
Adapt & optimize crude sourcing to reap most benefit according to oil price situation
Crude oil price($/BBL)
Refinery – Refinery upgrading project
Bangchak Corporation Plc. 31
StatusExpected
Completion
Continuous Catalyst Regeneration Unit (CCR) (CCR: Higher Capacity & maintenance cycle extension)
Detailed Engineering and Design Phase
Start Construction :
Civil and Steel Structure Works
2020
Debottlenecking
#1: Hydrocracker Unit (HCU) Revamping (Higher Optimal Crude Run: Distillate)
Detailed Engineering and Design Phase 2020
#2: Debottlenecking CDU & NPU & ISOU & KTU(Higher Optimal Crude Run: Light & Middle Distillate)
Under Bidding Process /
Value proposition revisit2020
3E Project Updates
Steel Structure Work on Main Piperack (PR-3302) Rebar formwork and pouring concrete of pedestal and foundation
Construction Progress
Continued as planned and expected to be completed in 2020
Refinery – IMO 2020 Preparations
Bangchak Corporation Plc. 32
Bangchak Refinery with Full FlexibilityBangchak Refinery with full flexibility to take crudes of different qualities from several supply regions
Crude Selection
Light Sweet Crude Processing (Low Fuel Oil Yield)
Refinery and Facilities (2019)
Catalyst Replacement in Kerosene Treating Unit
Maintenance for Sulfur Recovery Unit and Sulfur Tank
Blending current Fuel Oil to minimize investment to comply with IMO
17% 18%
15%13% 13%
9.6%
2013 2014 2015 2016 2017 2018
Fuel Oil Production Yield
Marketing Business – 2019 Highlight
Bangchak Corporation Plc. 33
Continue to increase market share in Retail Sales
2019 Network Expansion
+70New StationsMostly Standard size
Lubricant Non-oil (BCR) JET opportunity
Supporting business2019 Target
Sales Volume:5.7 ML/Mo
For both export market & domestic car care service
SPAR: +20 storesInthanin: +200 stores
Jet Fuel market expansion for both
domestic & export sales
160
335
2018 2019F
Retail Sales Industrial Sales
Unit: Million Litres / Month
Marketing Sales Volume Target
484
+9%Retail Sales Vol.
• Marketing Margin to be maintained at reasonable level
• Sales expansion in Direct Market
• High Margin product push
+65 Standard
+5 COOP
Bio-Based products – One of the largest bio-based product player in Thailand
Bangchak Corporation Plc. 34
3. Enhancement Program HVA 10% of Production
930,000 L/day (810,000 kg/day)
1,000,000 L/Day (330 ML/Yr)
(860,000 kg/day)
1.R&D: Cooperation with well-known technical provider
2. Set up Pilot Plant / Commercial Plant
Ethanol 1
2. M&A Ethanol plant2. New Refined Glycerin plant
1.Enhance Existing capacity
Bio-complex
Biodiesel 2
Bio-based Products 3 Food Supplement , Animal feed and Personal care4
28,000 Ton/Yr
Sales Volume Target
ML/Yr
- Ethanol Sugar based
500,000 L/Day 1,000,000 L/Day (330 ML/Yr)1.Enhance Existing capacity
350,000 L/Day 650,000 L/Day (215 ML/yr)
150,000 L/Day 150,000 L/Day (50 ML/yr) - Ethanol Cassava based
B100Sales Volume Target
ML/Yr
High Value Bio-Based Products
Investment ≈6,000 MB
1.JV Company
2. Set up Pilot Plant / Commercial Plant
Expand Biofuel Capacity
to 2.0 ML/Day
Natural Resources Business – Production profile
Production Profile Reserves (net to OKEA)
0
10
20
30
40
50
60
70
Draugen Gjoa Ivar Aasen YME Grevling Total
mmboe (as of 31 Dec 2018)
2P 2P 2P 2P 2C
Bangchak Corporation Plc. 26
0
5
10
15
20
25
30
35
2018 2019 2020 2021 2022 2023
Draugen Gjoa Ivar Aasen Yme Grevlingkboe/d
2019 CAPEX Plan
Bangchak Corporation Plc. 36
Refinery52%
Marketing11%
BCPG22%
Bio-based Products
14%
Others1%
CAPEX Plan14,000 MB
Unit: Million Baht CAPEX Plan
Refinery Maintenance Improvement Project
7,2002,5004,700
Marketing 1,600
BCPG - Existing Projects 3,100
Bio-Based Products 1,900
Strategic investment & Other 200
Total 14,000
“Belt tightening” budget acknowledged
* Excluded M&A and new businesses
THANK [email protected] Tel. +662 335 8663, 4390, 8518
www.bangchak.co.th
click Investor Relations
Disclaimer : The information contained herein is being furnished on a confidential basis for discussion purposes only and only for the use of the recipient, and may be subject to
completion or amendment through the delivery of additional documentation. Except as otherwise provided herein, this document does not constitute an offer to sell or purchase any
security or engage in any transaction. The information contained herein has been obtained from sources that Bangchak Corporation Public Company Limited (“BCP”) considers to be
reliable; however, BCP makes no representation as to, and accepts no responsibility or liability for, the accuracy or completeness of the information contained herein. Any projections,
valuations and statistical analyses contained herein have been provided to assist the recipient in the evaluation of the matters described herein; such projections, valuations and analyses
may be based on subjective assessments and assumptions and may utilize one among alternative methodologies that produce differing results; accordingly, such projections, valuations
and statistical analyses are not to be viewed as facts and should not be relied upon as an accurate representation of future events. The recipient should make an independent evaluation
and judgment with respect to the matters contained herein.