Thai Oil Public Co. Ltd. · SET:TOP
Thai Oil Public — Q4 2010 Earnings Presentation
64 slides from Thai Oil Public's earnings presentation, February 2011
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: Presentation Outline
Presentation Outline ® Q4 & FY/10 Highlights - «? Performance Analysis “° «? Market Outlook " «? TOP Way Forward
Slide 6: Q4 & FY/10 Highlights
Thadoy. Group 5@ wie a (ve Q4 & FY/10 Highlights _
Slide 7: Operation & Business, Corporate & Finance, Investments
Operation & Business • With recovery in global economy, driven by Asia, market GIM gradually improved to 5.7 $/bbl vs. 4.3 $/bbl last year • With a certain shutdown, utilization rate at 95% which allows TOP to run at max capacity in 2011. • Advanced Euro IV Gasoil and Gasoline production and sales a
Slide 8: Awards received 2010
TOP received TOP Corporate Governance Report Awards - SET Awards 2010 TOP received Platts TOP 250 Global Energy Companies Awards 2010 - Platts, TPX & IPT received EIA Monitoring Singapore Awards 2009 • # 9 of Oil & Gas Refining and Marketing in Asia • # 12 of Oil & Gas Refining and TOP has been anno
Slide 9: Performance Analysis
ats (ve Performance pnalysise =
Slide 10: Crude prices up on tightening grounds
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials $/bbl Crude prices managed to break the $70-$85 range to trade above $90 . . . 160 140 120 99.0 $/bbl as of 18 Feb 100 80 78 62 60 40 44 59 68 75 77 74 75 84 20 Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10 Q4/10 2011 … bett
Slide 11: Market GRM
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials + Strong heating oil demand due to Colder-than- LPG - DB (controlled price) (Unit: $/bbl) GO normal weather in North Asia, US & EU -16.4 + Strong Chinese diesel demand -31.2 -33.8 13.0 -40.0 -41.3 11.3 12.4 11.4 -47.5 -4
Slide 12: 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 99.0 $/bbl (Unit: $/bbl) as of 18 Feb 100 3.8 1.2 0.7 2.7 2.9 3.7 3.6 1.1 3.3 -1.4 80 Stock Gain/Loss 78 (Unit: $/bbl) 62 60 6.1 0.8 3.5 0.4 3.6 2.3 0.8 -0.9 -0.4 -0.1 Acc
Slide 13: Crude sourcing and product yield
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Sources of Crude Spread over Dubai Spread over Dubai (US$/bbl) (US$/bbl) Others1 1% 4% 2 3% 2 -16.4 6% -14.8 LPG 9% 4% 14% Far East 14% Platformate 11% Local 8.5 16% 10.3 Gasoline 17% 8.3 20% 12.1 Jet 19% Middle East 88%
Slide 14: Domestic oil demand and TOP's domestic and export sales
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Domestic Oil Demand / Refinery Intake Domestic Oil Demand (KBD) 3% (KBD) 1,400 88% 86% 90% 90% 87% 89% 100% 713 737 1,200 FY/09 80% 1,000 FY/10 202 160 60% 0% 800 221 120 192 144 600 40% 15% -1% 318 319 400 7% -4% 748 69
Slide 15: Aromatics spot prices and margins
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Aromatics Spot Prices & Margins Aromatics %Utilization (US$/Ton) Q1/09 Q2 Q3 Q4 Q1/10 Q2 Q3 Q4 FY/10 2009 2010 PX-ULG95 384 475 355 321 286 226 218 456 296 87% 85% BZ-ULG95 -60 79 160 178 215 159 132 152 165 Paraxylene (
Slide 16: Base oil and bitumen spot prices and margins
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Base Oil & Bitumen Spot Prices & Margins Base oil %Production Rate (US$/Ton) Q1/09 Q2 Q3 Q4 Q1/10 Q2 Q3 Q4 FY/10 2009 2010 500SN-HSFO 398 268 404 429 435 541 607 593 544 93% 82% BIT-HSFO 70 -5 -3 -23 27 38 46 -25 22 Lube
Slide 17: Accounting GIM and Market GIM
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials (US$/bbl) 20.6 20.3 20.7 20.2 15.7 17.4 20.7 13.4 12.0 14.7 Product to Feed Q1/09 Q2 Q3 Q4 Q1/10 Q2/10 Q3/10 Q4/10 FY/09 FY/10 3.8 2.7 2.9 3.7 3.6 3.3 Market 1.2 0.7 1.1 Crude GRM* (excluded stock gain / loss) -1.4 Q1/09
Slide 18: FY/10 Net Profit Breakdown (excluding stock gain/loss & LCM)
without stock gain/loss Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Refinery Aromatic Lube Base Plant Plant Ship SAKC Utilization Utilization Production Production Availability Utilization Utilization 99% 95% 96% 93% 94% 96% 87% 85% 93% 82% 75% 80% 77% 28% FY/09 F
Slide 19: FY/10 Net Profit Breakdown (including stock gain/loss & LCM)
with stock gain/loss Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Refinery Aromatic Lube Base Plant Plant Ship SAKC Utilization Utilization Production Production Availability Utilization Utilization 99% 95% 96% 93% 94% 96% 87% 85% 93% 82% 75% 80% 77% 28% FY/09 FY/1
Slide 20: Q4/10, Q3/10, Q4/09 financial summary
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials (US$/bbl) Q4/10 Q3/10 Q4/09 QoQ+/(-) FY/10 FY/09 YoY+/(-) % Market GRM 3.6 3.7 -1.4 (0.1) 3.3 1.1 2.2 200% Market GIM 6.2 6.1 2.4 1.0 5.7 4.3 1.7 37% (MB) Sales Revenue 81,244 79,041 78,944 2,203 318,391 284,123 (34,268)
Slide 21: Financial Ratios
Refining Aromatics Lube Base Integrated Margin Performance Breakdown Financials Balance Sheet Consolidated Long-Term Debt 1) (Unit: MB) 137,745 146,607 Total LT Debt FY/10 Net Debt 43,563 LT Debt* Bt. 43,563 mn. Bt. 29,989 mn. 42,134 Current (US$ 1,438 mn.) (US$ 990 mn.) Assets 23,924 26,206 Trade P
Slide 22: Dividend Policy
Dividend Policy : Not less than 25% of consolidated net profit after deducting reserves, subject to cash flow and investment plan Dividend Payment THB/Share Payout THB/Share 25% Min. Div. Payout n.a. FY/04 1.80 25% 9.19 9.40 FY/05 3.50 40% EPS 8.13 7.82 FY/06 3.50 45% 48% 45% Interim 1.50 43% 45% 40
Slide 23: 2011 Market Outlook
2011 Market Outlook •Q1-2011 Market Highlight •Macroeconomics & Crude Prices •Petroleum Market •Aromatics & Base Oil •Conclusion 23
Slide 24: Q1 2011 market highlights
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion ‘10 ‘10 ‘11 Q3 Q4 QTD Crude surged on supply disruption, better Dubai 73.9 84.4 94.2 economic data and Egypt Unrest MO-DB 8.6 10.6 13.2 Gasoline rose on supply tightness from plant JET-DB 12.8 14.3 18.3 turnaroun
Slide 25: Macroeconomics & Crude Prices
Macroeconomics & Crude Prices Upbeat economics outlook… Higher oil prices 25
Slide 26: GDP Growth (%YoY)
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Developed countries in better-than-expected shape, emerging countries’ growth decelerate amid overheating & inflation pressures . . . 2010 2011 2012 16% China 10.3% 9.6% 9.5% 12% India 9.7% 8.4% 8.0% 8% GDP Growt
Slide 27: Global oil demand and supply outlook
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Global oil demand to grow by another 1.5 MBD this year, Non-OPEC supply fails to match rising demand, touching a record high of 89.3 MBD OPEC spare capacity to be further depleted MBD MBD 35 Total Crude Oil Produ
Slide 28: Geopolitical risks and fund flows
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion … Geopolitical Risks Net Long Positions in WTI Futures Positions $/bbl 180,000 160 Political unrests spreading throughout ME and NA (Tunisia, 150,000 140 Egypt, Jordan, Yemen, Iran, 120,000 120 Bahrain, Libya) ca
Slide 29: WTI vs ICE Brent vs Dubai
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Chart 1: WTI vs ICE Brent vs Dubai $/BBL $/BBL 140 4 135 0 130 -4 125 -8 120 -12 115 WTI-ICE BRT -16 110 -20 WTI -24 105 -28 100 BRT -32 95 -36 DB 90 -40 85 -44 80 -48 75 -52 70 -56 65 -60 Jan-10 Apr-10 Jul-10 Oc
Slide 30: What the Others Say
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion What the Others Say Crude prices continue to move upward in a $80 - $100 range . . . Oil Price Forecast WTI BRENT Unit : USD/BBL 2011 2012 2011 2012 Barclays $91.0 $106.0 $91.0 $105.0 BNP Paribas $89.0 $95.0 $90.
Slide 31: What We See
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion What We See We revise up average Dubai to $92.6, ranging $85-100/barrel, on pick up economic activities, more fund flow and unexpected events $/BBL $/BBL 100 $95 100 $94 $94 $91 $91 90 90 80 $78 80 70 $68 70 $62
Slide 32: Petroleum Market
Petroleum Market Optimistic GRM … On stronger demand & heavy turnaround 32
Slide 33: US, EU and Singapore cracking margins
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion 20 20 20 US Cracking Margin EU Cracking Margin Singapore Margin 16 16 16 S’Pore Crk S’Pore Hydro 12 12 12 8 8 8 4 4 4 0 0 0 -4 -4 -4 -8 -8 -8 Apr-08 Apr-08 Apr-08 Jun-07 Feb-09 Jun-07 Feb-09 Jun-07 Feb-09 Jan-07
Slide 34: Product supply and cracks downside risk
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Avg.06-09 09 10 11 Avg.06-09 09 10 11 Source: EIA, Reuters, Thai Oil Supplies are coming out from refineries due to healthy GRM. This will be the downside risk for product cracks once winter demand fades 34
Slide 35: Refining capacity closures and maintenance schedule
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion “ Since 2009, almost 1.2 MBD refining capacity has been out of the market” North Unit : KBD Europe Asia Total America Closed 677 317 170 1164 Partial 150 190 0 340 Pending 195 260 0 455 Planned closures (Japan) 3
Slide 36: Thai local supply and demand outlook
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion 1.) Tight local supply as many refineries T/A for Euro IV tight-in Q1 Q2 Q3 Q4 A B C,D 2.) Stabilized Economy & Better Projected Demand as Govt Supports GDP Growth Forecast of 4.0 – 5.0 % YoY Growth ( %YoY) 201
Slide 37: LPG Ex-Refinery Price Implication
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion LPG Ex-Refinery Price Implication • Refineries produce more LPG, hence Previous Current reducing imports and currency outflow (24% * $332) • TOP’s domestic LPG sales increase from $332/ton + 18,000 ton/month to 3
Slide 38: Aromatics
Aromatics PARAXYLENE SKYROCKET…. Will it last for long? 38
Slide 39: PX price breaks the record
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion $/ton $/ton 1,800 1,600 1,400 “ PX Price breaks The Record, hit 16-year-high ” 1,200 1,000 800 600 400 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Naphtha Paraxylene Benzene Toluene 39
Slide 40: PX price and series of outages
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion $/ton $/ton 1,800 1,600 1,400 Series of outage 1,200 CNOOC 1,000 Fujia JX 800 Oman 600 400 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Naphtha Paraxylene Benzene Toluene Unplanned S/D 40
Slide 41: PX price and new PTA plant
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion $/ton $/ton 1,800 Company: Hanbang Petrochemical (Chengxing) Product: PTA Capacity: 600KTPA New PTA 1,600 Technology: Invista 1,400 Series of outage 1,200 CNOOC 1,000 Fujia JX 800 Oman 600 400 Jun-10 Jul-10 Aug-1
Slide 42: PTA futures plunge
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion $/ton $/ton 1,800 Plunge PTA futures on fear of Chinese inflation control New PTA 1,600 1,400 Series of outage 1,200 CNOOC 1,000 Fujia JX 800 Oman 600 400 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Jan-11 F
Slide 43: Kuwait declares force majeure
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion $/ton $/ton 1,800 Plunge PTA futures on fear of Kuwait declared FM Chinese inflation control New PTA 1,600 1,400 Series of outage 1,200 KPPC CNOOC 1,000 Fujia JX 800 Oman 600 400 Jun-10 Jul-10 Aug-10 Sep-10 Oct-1
Slide 44: Fire at AMSB Malaysia
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion $/ton $/ton A fire @ AMSB 1,800 Plunge PTA futures on fear of Kuwait declared FM Malaysia Chinese inflation control New PTA 1,600 1,400 Series of outage 1,200 KPPC AMSB CNOOC 1,000 Fujia JX 800 Oman 600 400 Jun-1
Slide 45: Traders short position
Traders short position Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion $/ton $/ton A fire @ AMSB 1,800 Plunge PTA futures on fear of Kuwait declared FM Malaysia Chinese inflation control New PTA 1,600 1,400 Series of outage 1,200 KPPC AMSB CNOOC 1,000 Fujia JX
Slide 46: Chinese New Year
Traders short position Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion $/ton $/ton A fire @ AMSB 1,800 Plunge PTA futures on fear of Kuwait declared FM Malaysia Chinese inflation control New PTA 1,600 1,400 Series of outage Chinese New Year 1,200 KPPC AMSB CNO
Slide 47: Aromatics supply outlook and polyester market
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Less output from Urumqi New 1 Mill ton PX plant is facing 3 Mill PTA on queue to S/U difficulties from its landscape and 3 New PTA plants in China will on infrastructure stream during Jul-Sep 2011 Market fore
Slide 48: Downstream health check up and new Asian PTA capacities
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion $/Ton 900 PX* “ Despite the heated PX 800 Downstream Health Check Up 700 price, PTA and PET are 600 able to catch up and 500 keep their margin at 400 the enjoyable level ” 300 200 PTA* 100 PTA B/E *PX Margin = PX
Slide 49: Lube Base & Bitumen
Lube Base & Bitumen Developing countries demand Keep Momentum for Base Oil & Bitumen 49
Slide 50: Registered Vehicle and Car Sales
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Registered Vehicle and Car Sales Vehicle Registered in Thailand China Car Sales Thailand Car Sales Unit Car Unit Car 30,000,000 900,000 850,000 25,000,000 800,000 20,000,000 750,000 700,000 15,000,000 650,000 600
Slide 51: Chinese bitumen demand and expressway mileage
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion Chinese Bitumen Demand Forecast Chinese Expressway Mileage Unit : Million TON Unit : km Mileage added %YoY 35 10000 120% 9000 30 95% 100% 8000 86% 80% 25 7000 6000 60% 20 5000 40% 15 4000 20% 10 3000 0% 2000 5 -2
Slide 52: Extract and TDAE
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion 500EX’s Value Added in 2010 Extract and TDAE $/TON Chinese Tire Production 1200 Million Unit 600 1000 550 800 500 600 450 400 400 200 350 0 300 500EX TDAE The blooming demand is the certain factor pulling the Chi
Slide 53: Conclusion
) @ o> é ivers® Posi] Ve 53
Slide 54: Outlook for crude, refinery, aromatics and lube base
Q1-2011 Market Highlight Macro & Crude Petroleum Market Aromatics & Base Oil Conclusion CRUDE “Higher and volatile oil prices from higher demand, fund flow and unexpected events” REFINERY “Improving GRM on less new supply with opportunity from local refineries shutdown and LPG upside” AROMATICS “Roc
Slide 55: TOP Way Forward
ivers® ae TOP Way Forward 55
Slide 56: Growth, OpX and TQC roadmap 2010-2015
2010 2011 2012 2013-2015 Industry Outlook • 2 SPPs @ 220 MW (2015) • HCU Revamp P. I (2013) • Euro IV all grades • HCU Revamp P.II/III • PXMax • Benzene Derivatives • TDAE +50,000 TPA Growth • Full Contribution • Lube Base: G.II/III & from SAPTHIP Specialties OpX • Integrated operation to increase G
Slide 57: Q and A
) mer ats QandAs 57
Slide 58: Thank You
Thank You Any queries, please contact: at email: [email protected] Tel: 662-797-2999 / 662-797-2961 Fax: 662-797-2976 58
Slide 59: Appendices
Thadoy 5 ) er = at (ve 59
Slide 60: LPG Demand Highlight
Thailand LPG Demand LPG Demand Highlight ML/Mth • LPG Demand in 12M grew 11.1% YoY driven 1,000 950 mainly by industry sector: 900 850 816 855 834 844 884 Household +9.4% YoY 801 830 800 801 816 750 793 2008 Transportation +0.9% YoY 729 769 2009 700 650 Industry +34.3% YoY 2010A 600 Petroche
Slide 61: Gasoline Demand Highlight
Thailand Gasoline Demand Gasoline Demand Highlight ML/Mth 800 • Gasoline demand contracted 1.4% YoY 12m 750 2010 due to higher retail price in Q1 700 637 comparing to last year 650 619 607 665 600 606 620 607 617 616 632 2008 • Portion of gasohol & gasoline sales is 599 2009 relatively maintained at
Slide 62: Jet-A1 Demand Highlight
Thailand JET-A1 Demand JET Demand Highlight ML/Mth 500 • After BKK crackdown in May, in-bound 450 tourists have rebounded continuously 436 425 400 422 leaning support JET fuel demand in 2010, 387 389 390 396 378 359 359 2008 where growth is 6.8% YoY 12M 350 334 334 2009 300 2010A 250 200 Jan Feb Mar
Slide 63: Gasoil Demand Highlight
Thailand Gasoil Demand Gasoil Demand Highlight ML/Mth 1,900 • Gasoil demand was flat 12M despite the 1,800 rising retail prices compared with last year. 1,700 (Partially supported by robust manufacturing 1,688 1,666 1,600 2008 growth) 1,5661,546 1,588 1,583 1,550 1,500 1,5091,517 2009 • Current Port
Slide 64: Fuel Oil Demand Highlight
Thailand Fuel Oil Demand Fuel Oil Demand Highlight ML/Mth • FO demand contracted 4.2% YoY 12M 2010 500 450 owing to reduction of requirement from 400 power plants as fewer occurrence of NG 350 2008 disruptions however this was limited by the 300 292 250 251 2009 healthy demand due to recovery of glo
Thai Oil Public Company — Q4 2010 Earnings Presentation on 6ix