1q2019 opportunity day · 5/16/2019 · cpko (mpob) : usd/ton fa (icis) : usd/ton natural fatty...

1Q2019 Opportunity DayThursday, May 16, 2019

Disclaimer

This presentation includes forward-looking statements that are subject to risks and uncertainties,including those pertaining to the anticipated benefits to be realized from the proposals describedherein. This presentation contains a number of forward-looking statements including, in particular,statements about future events, future financial performance, plans, strategies, expectations,prospects, competitive environment, regulation and supply and demand.

GGC has based these forward-looking statements on its views with respect to future events andfinancial performance. Actual financial performance of the entities described herein could differmaterially from that projected in the forward-looking statements due to the inherent uncertainty ofestimates, forecasts and projections, and financial performance may be better or worse thananticipated. Given these uncertainties, readers should not put undue reliance on any forward-lookingstatements.

Forward-looking statements represent estimates and assumptions only as of the date that they weremade. The information contained in this presentation is subject to change without notice and GGCdoes not undertake any duty to update the forward-looking statements, and the estimates andassumptions associated with them, except to the extent required by applicable laws and regulations.

Agenda

Highlights

Palm Oil Market Update

Financial Performance

GGC Going Forward

Key Highlights

1Q2019 Highlights

+ Natural FA prices were being in competitive range to synthetic FA+ FA Supply was tight due to plant shutdown in EU and China+ Improve FA sales volume compares to 1Q2018

+ ME plant 2 has commenced the commercial operation on April 5, 2019.

+ Mandate of B7 + Gov. has attempted to build up demand of B20

+ Extend price subsidies on B20 = B7-5 THB/litre(From Feb 19 to Jul 19)

+ Government targets to increase no. of B20 gas station to 1,000 stations

- Consolidated EBITDA -32% YoY - ME EBITDA -98% YoY + FA EBITDA +192% YoY

- High competition led to narrow margin- Glycerine price drop from glut supply- CPO prices continue downward trend due to high inventory in domestic and international market

ME Business Unit: FA Business Unit:

Financial Performance:

- FA Plant planned shutdown during 1 - 11 January 2019 for changing catalyst

Palm Oil Market Updates Financial PerformanceGGC Going ForwardHighlights

Plant Operation :

- CPKO prices continue downward trend due to high inventory in domestic and international market

20.34

16.94 16.04

19.57

1Q18 4Q18 1Q19 FY18 1Q18 4Q18 1Q19 FY18

5.14 5.22 4.87 5.19

1Q18 4Q18 1Q19 FY18

24.6621.78 20.74

24.15

1Q18 4Q18 1Q19 FY18

1Q2019 Operation Highlights

ME (EPPO) : THB/Litre

METHYL ESTER (B100) BUSINESS UNIT

Biodiesel Mandate

ME EPPO P2F : THB/Kg

GGC’s ME Operational Performance

B7 B7 B7 B7

CPO (DIT) : THB/Kg

119% 112% 102% 113%

1Q18 4Q18 1Q19 FY18

102,754 97,431 (2)

94,703 (1)

374,922

1Q18 4Q18 1Q19 FY18

18026 21

509

1Q18 4Q18 1Q19 FY18

Adjusted EBITDA (MB)

Sales Volume (Tons)

THB/Kg 1Q18 4Q18 1Q19 FY18

ME EPPO 28.51 25.18 23.98 27.91

ME1 Plant Utilization Rate

Note: The company could only realize the total sales volume from ME plant 1 because ME plant 2 is under testing run for commercial operation in 4Q18 and 1Q19. (1) In 1Q19, Sales volume from ME plant 2 = 15,678 tons(2) In 4Q18, Sale volume from ME plant 2 = 7,109 tons

Note: Utilization rate calculated base on nameplate capacity of ME1


419535 553

471

1Q18 4Q18 1Q19 FY18

1,7841,395 1,365 1,568

1Q18 4Q18 1Q19 FY18

1,138

717 677 914

1Q18 4Q18 1Q19 FY18

FATTY ALCOHOLS BUSINESS UNIT

CPKO (MPOB) : USD/Ton

FA (ICIS) : USD/Ton

Natural Fatty Alcohols regainedCompetitiveness vs. Synthetic ones

FA Market P2F : USD/Ton

GGC’s FA Operational Performance

Plant Utilization RateCrude Oil Price (WTI) : USD/BBL

Ethylene Price (USGC) : USD/Ton

Synthetic FA (C1215) Price : USD/Ton

Natural Mid Cut FA (C1214) Price : USD/Ton

1Q2019 Operation Highlights

63 59 55 65

1Q18 4Q18 1Q19 FY18

669 660 614 643

1Q18 4Q18 1Q19 FY18

2,3811,764 1,565

2,039

2,160 1,562 1,502 1,742

1Q18 4Q18 1Q19 FY18

101%129%

111% 115%

1Q18 4Q18 1Q19 FY18

24,235 33,442

24,798

114,784

1Q18 4Q18 1Q19 FY18

264 284 196

877

1Q18 4Q18 1Q19 FY18

Adjusted EBITDA (MB)

Sales Volume (Tons)


Agenda

Highlights



GGC Going Forward

ProjectMethyl Ester

Plant 2Refined Glycerin

Plant 2Biocomplex

Phase 1

CapacityMethyl Ester

200 KTARefined Glycerin

20 KTASugarcane : 2.4 mm TPAEthanol : 186 mm LPA

CAPEX 1,650 MB 326 MB 7,500 MB (GGC hold 50%)

Project Progress Update COD Awarded EPC 2Q19Site Preparation

Loan Agreement SignedEPC Selection

Scheduled COD 5 Apr 2019 2Q20 Early of 1Q21

COD as of Apr 5, 2019

Projects Timeline

Refined GlycerinPlant 220 KTA

Methyl Ester Plant 2200 KTA

BiocomplexPhase 1

Sugarcane : 2.4 mm TPA

Ethanol : 186 mm LPA

2018End

2019End

2020End


Agenda

Highlights



GGC Going Forward

2Q19 Highlights of Palm Oil & Oleochemicals MarketME Chain ME Price & Spread

FA Price & Spread FA Chain

ME:• ME demand in Q2/19 remains healthy due to supportive Biodiesel

policies from government;- Target to implement B10 as an optional fuel for diesel car in May’19- B20 demand is accelerating with increase no. of B20 stations- Government also plans to extend B20 subsidiary program at 5 THB/L from end of May’19 to Jul’19

- Gap of ME (B100) vs B7 price encourages some users to use ME (B100) directly

CPO:• Local CPO price is slightly firmer amid healthy demand from EGAT and

Biodiesel producers• Local CPO stock Mar’19: 434,244 tons Apr’19: 383,957 tons

FA:• FA demand is still healthy amid tight supply• Natural FA price still has advantage over Synthetic FA• Some Chinese producers were forced to shutdown due to strict Safety

and EnvironmentalCPKO:• CPKO price is moving sideway due to ending of palm harvesting season

in Malaysia and Indonesia• However, CPKO price is still pressured by high inventory level

Palm Oil Market Updates Financial Performance GGC Going ForwardHighlights

5.2 5.0 4.8 4.9 5.1 5.1 5.3 5.2 4.9 5.6 5.0 5.2

39.5

34.430.5

28.6 28.5 28.9 29.025.2 24.0 23.7

33.3

27.9

30.8

25.822.4 20.5 20.3 20.8 20.2

16.9 16.0 15.3

24.9

19.6

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 Apr-19 FY17 FY18

THB/KG Spread ME CPO

424 584 433 488 419 468 463 535 553 580 483 471

2,243 1,783 1,820

2,054 1,784

1,570 1,521 1,395 1,365 1,263

1,975

1,568 1,516

999 1,156

1,304 1,138

919 882 717 677 570

1,244 914

0

500

1,000

1,500

2,000

2,500

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 Apr-19 FY17 FY18

USD/TSpread FA CPKO


Opportunity: Potential to increase Biodiesel blending rate

*GGC expected B20 from diesel passenger car maximum consumption 157 ML/M -> B100 30.2 ML/M ( additional from B7 19.6 ML/M)

8.816.7

25.7

40.0

50.055.0

60.566.6

73.280.5 81.3 82.1

0.00

15.00

30.00

45.00

60.00

75.00

90.00

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

ML/MForecast

2019 Forecast B20 Demand

MOEN reported B✓ 20 consumption in Apr’19: ̴40 ML (increased by 55% from previous month)As of Mar✓ ’19, there are 207 stations(B20) nationwide and expanding up to 1,000 stations by the end of this yearGovernment also plans to prolong B✓ 20 subsidiary program at 5 THB/L from end of May’19 Jul’19

Palm Oil Market Updates Financial Performance GGC Going ForwardHighlights Palm Oil Market Updates Financial PerformanceGGC Going ForwardHighlights

Opportunity: Potential to increase Biodiesel blending rate

B10 Development Timeline

Next StepB10 Mandate

JAMA recommends B100 and B10 specification;B100, MG < 0.4% wt.B10 Water < 200 ppm

97 models of

accepted B20

DOEB announced B10 and B100 specification as JAMA suggestion

MOF announced the Excise Tax for additional Biodiesel Blending Ratio

15th May 2019

22nd Apr 2019

15th May 2019

11st Mar 2019


Agenda

Highlights



GGC Going Forward

Consolidated Financial Performance

Sales Revenue (MB) EBITDA & Adjusted EBITDA* (MB) /Adjusted EBITDA Margin* (%)

1Q191Q18 4Q18

ME EBITDA ME Adjusted EBITDA FA EBITDA FA Adjusted EBITDA

Consolidated Adjusted EBITDA Margin

Net Profit (MB) & Net Profit Margin (%)

FY18

2,774 2,079 1,714

9,913 1,857

1,575 1,102

6,312

4,631 3,654

2,816

16,225

1Q18 4Q18 1Q19 FY18

ME Business Unit FA Business Unit

64 443 (1) 22

-1,161 (2)

1Q18 4Q18 1Q19 FY18

1.4%

12.1%

0.8%

163 180

1 26 3 21

429 509

48

264

285 284

140 196

494

877

211

444

286 310

143 217

923

1,386

9.6% 8.5% 7.7% 8.5%

-7.2%

Note:(1) In 4Q18, net profit was recorded 443 MB which was included tax income

from deferred tax assets amounting to 272 MB. (2) In FY18, net profit was recorded -1,161 MB which was included tax

income from deferred tax assets amounting to 356 MB and expenses from raw materials derogation amounting to 2,004 MB.


Financial Position

Statements of Financial Position

Cash and Cash Equivalent

Account Receivable, Inventory, and other

Current Assets

PP&E

Non-current Assets

Other Liabilities

Interest Bearing

Debt

Shareholders’

Equities

December 31, 2018Baht 13,084million

Key Financial Ratios

Repayment Plan Cash FlowsMillion Baht

Million Baht

Million Baht

528

935

(2,292)

2,575 1,745

*

*Cash from IPO was spent in ME2 project of 1,150 MB and WC 308 MBEnding Cash had not included short-term investment of 1,350 MB

March 31, 2019Baht 12,799 million

338

441

567

765

2019 2020 2021 2022

2,387

+252-90 -17

2,532

BeginningCash

OperatingCash Flows

CAPEX &Investment

Financing EndingCash

7,923 11,073 9,708 9,730

2,689

2,400 2,120 2,121

FY16 FY17 FY18 1Q19

0.3 0.2 0.2 0.2

1.8 2.1 2.3 2.2


Performance 1Q19 vs. 1Q18Net Profit : Million Baht

Operating ProfitsIn 1Q19, operating profits was lower than 1Q18, mainly from these factors;• The lower profitability of ME due to aggressive market competition and decreasing of sales volume• A decrease in refined glycerine price regarding to supply glut

Stock Gain/(Loss) & NRV

In 1Q19, the company recognized stock loss & NRV of 74 MB due to downward trend in CPO & CPKO prices. However, it was improved from 1Q18 by 159 MB due to improving inventory management.

Gain/(Loss) from FX

In 1Q19, the company recorded loss of 3 MB against loss of 27 MB in 1Q18 due to the impact from THB appreciation, in which THB was appreciated by 1.7% in 1Q19 and in 1Q18 was appreciated by 3.7%


Performance 1Q19 vs. 4Q18

Operating ProfitsIn 1Q19, operating profits was lower than 4Q18, attributed to the lower EBITDA of fatty alcohols due to lower sales volume from FA plant planned shutdown for changing catalyst and low seasonal demand in this quarter.

Stock Gain/(Loss) & NRV

In 1Q19, the company recognized stock loss & NRV of 74 MB while recorded stock & NRV of 24 MB in 4Q18, primarily due to downward trend in CPO and CPKO prices.

Net Profit : Million Baht

-50 -2 -4


T H A N K Y O U

Global Green Chemicals Public Company Limited

555/1 , Energy Complex, Building A, 4th Floor,

Vibhavadi Rangsit Road, Chatuchak, Chatuchak,

Bangkok 10900, Thailand

Tel: +66(0) 2 558 7306

Tel: +66(0) 2 558 7345

Fax: +66(0) 2 558 7301www.ggcplc.com

For further information or enquiries,

please contact our Investor Relations Team : [email protected]

Appendix

Palm Oil & Oleochemicals Market

14.76

CP

KO

CP

O

2016 2017 2018

Gly

ce

rin

e

29

.63

30

.10

29

.02

32

.26

33

.93

33

.50

37

.49

34

.00

31

.05

30

.00

29

.63

30

.80

31

.40

31

.97

28

.97

26

.91

26

.77

23

.84

23

.05

22

.13

22

.11

21

.59

20

.73

19

.12

19

.10

21

.28

20

.37

18

.97

20

.16

23

.2

21

.59

20

.09

19

.03

17

.89

16

.22

16

.72

17

.04

16

.32

15.00

20.00

25.00

30.00

35.00

40.00

45.00

Jan

-16

Feb

-16

Mar

-16

Ap

r-1

6

May

-16

Jun

-16

Jul-

16

Au

g-1

6

Sep

-16

Oct

-16

No

v-1

6

Dec

-16

Jan

-17

Feb

-17

Mar

-17

Ap

r-1

7

May

-17

Jun

-17

Jul-

17

Au

g-1

7

Sep

-17

Oct

-17

No

v-1

7

Dec

-17

Jan

-18

Feb

-18

Mar

-18

Ap

r-1

8

May

-18

Jun

-18

Jul-

18

Au

g-1

8

Sep

-18

Oct

-18

No

v-1

8

Dec

-18

Jan

-19

Feb

-19

Mar

-19

CPO_DIT(B/kg)

92

4

1,0

02

1,1

56

1,2

86

1,2

05

1,3

04

1,2

76

1,4

38

1,4

81

1,3

75

1,5

15

1,6

25

1,7

76

1,5

84

1,1

88

95

0

1,0

65

98

2

98

9

1,1

26

1,3

52

1,3

32

1,3

38

1,2

43

1,2

56

11

48

10

09

98

5

91

6

85

4

87

1

90

3

87

1

77

7

66

8

70

6

74

8.9

3

67

9.3

8

60

1.7

4

-

500

1,000

1,500

2,000

Jan

-16

Feb

-16

Mar

-16

Ap

r-1

6

May

-16

Jun

-16

Jul-

16

Au

g-1

6

Sep

-16

Oct

-16

No

v-1

6

Dec

-16

Jan

-17

Feb

-17

Mar

-17

Ap

r-1

7

May

-17

Jun

-17

Jul-

17

Au

g-1

7

Sep

-17

Oct

-17

No

v-1

7

Dec

-17

Jan

-18

Feb

-18

Mar

-18

Ap

r-1

8

May

-18

Jun

-18

Jul-

18

Au

g-1

8

Sep

-18

Oct

-18

No

v-1

8

Dec

-18

Jan

-19

Feb

-19

Mar

-19

CPKO(USD/Ton)

0

200

400

600

800

1000

1200

Spread(USD/Ton) RGL(USD/Ton) CGL(USD/Ton)

Key Performance By Business Unit

ME

TH

YL

ES

TE

R (

B100)

BU

SIN

ES

S U

NIT

FA

TT

Y A

LC

OH

OL

S

BU

SIN

ES

S U

NIT

(1) Nameplate Capacity 300,000 tons per year from ME1 (2) In 1Q2019, GGC had sales volume form ME2 of 15,678 tons (3) In 4Q2018, GGC had sales volume form ME2 of 7,109 tons (4) Conversion ratio: 0.865 tons = 1,000 litres(5) Adjusted EBITDA refers to EBITDA excluding impact of Stock Gain/(Loss) and NRV

(1) Adjusted EBITDA refers to EBITDA excluding impact of Stock Gain/(Loss) and NRV

Consolidated Income Statement

MB % MB % MB % MB % MB %

Sale Revenue 2,816 100 4,631 100 (1,815) (39) 3,654 100 (838) (23)

Feedstock (1,975) (70) (3,522) (76) 1,547 (44) (2,575) (70) 600 (23)

Net Realizable Value (NRV) (7) (0) 2 0 (9) (450) (4) 0 (3) 75

Product to Feed Margin 834 30 1,111 24 (277) (25) 1,075 29 (241) (22)

Variable Costs (403) (14) (495) (11) 92 (19) (484) (13) 81 (17)

Fixed Costs (133) (5) (126) (3) (7) 6 (163) (4) 30 (18)

Stock Gain/(Loss) (67) (2) (235) (5) 168 (71) (20) (1) (47) 235

SG&A (110) (4) (72) (2) (38) 53 (140) (4) 30 (21)

Other Income 22 1 28 1 (6) (21) 18 0 4 22

EBITDA 143 5 211 5 (68) (32) 286 8 (143) (50)

Depreciation and Amortization (111) (4) (139) (3) 28 (20) (125) (3) 14 (11)

EBIT 32 1 72 2 (40) (56) 161 4 (129) (80)

Net Financial Costs (4) (0) (5) (0) 1 (20) (5) (0) 1 (20)

FX Gain/Loss(1) (3) (0) (27) (1) 24 (89) (1) (0) (2) 200

Share of Profit/(Loss) from investment 1 0 20 0 (19) (95) 9 0 (8) (89)

Income Tax Expenses (4) (0) 4 0 (8) (200) 7 0 (11) (157)

Net Profit bef extra items 22 1 64 1 (42) (66) 171 5 (149) (87)

Extra item net of tax(2) - n.a. - n.a. - n.a. 272 7 (272) (100)

Net Profit after extra items 22 1 64 1 (42) (66) 443 12 (421) (95)

QoQ1Q2019 1Q2018 YoY 4Q2018

Notes : (1) Including Gain/(Loss) from FX and Derivatives (2) Extra item was tax income from deferred tax assets amounting to THB 272 million.

1q2019 opportunity day · 5/16/2019 · cpko (mpob) : usd/ton fa (icis) : usd/ton natural fatty...

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