Download - Formosa Petrochemical 2007Q1 Results Presentation For the Three Months Ended in March 31, 2007
Formosa Petrochemical 2007Q1 Results Presentation
For the Three Months Ended in
March 31, 2007
2
Index
11 Our Company
Financials
Refinery Division
Olefins Division
Capital Expansion
22
33
44
55
3
Our Company: Leading Private Integrated Producer in Asia
FormosaPlastics29.4%
FormosaPlastics29.4%
Nan YaPlastics23.8%
Nan YaPlastics23.8%
Formosa Chemicals & Fibre
25.2%
Formosa Chemicals & Fibre
25.2%
Formosa Taffeta
4.0%
Formosa Taffeta
4.0%
Formosa PetrochemicalFormosa PetrochemicalFormosa PetrochemicalFormosa Petrochemical RefineryRefineryRefineryRefinery
OlefinsOlefinsOlefinsOlefins
UtilitiesUtilitiesUtilitiesUtilitiesFormosa Formosa Petrochemical Petrochemical TransportationTransportation
Formosa Formosa Petrochemical Petrochemical TransportationTransportation
Formosa OilFormosa Oil(Asia Pacific)(Asia Pacific)
Formosa OilFormosa Oil(Asia Pacific)(Asia Pacific)
100% 88%
Source: Company data.
PrincipalPrincipalShareholdersShareholders
Note 1: Shareholding percentage as of December 2006.Note 2: Taiwan Ratings on FPCC as of January 2005.
OUTLOOKOUTLOOK RATINGSRATINGS
Long term credit twAA-
Short term credit twA-1
Long term outlook Stable
Taiwan Ratings on FPCC
Taiwan Stock Exchange IPO on December 26, 2003. Founded by Formosa Plastics Group companies in 1992
One refinery, two naphtha cracker plants and three co-generation plants vertically integrated in No.6 Naphtha Cracker Complex site
As of Dec 2006, total refining capacity is 510,000 bpd, ethylene capacity is 1.735 million MTY and electricity generation is 2,720 MW
Source: Company data.
1
2
4
Co-GenCo-GenII-UPBII-UPB(600)(600)
Plant IIPlant II(900,000)
Our Company:Our Track Record
128.651.6
529.6443.3
347.4
169.4236.5
2000 2001 2002 2003 2004 2005 2006
Sales Revenue (NT$ billion)
Start-UpStart-UpStart-UpStart-Up Rapid GrowthRapid GrowthRapid GrowthRapid Growth Consolidating the LeadConsolidating the LeadConsolidating the LeadConsolidating the Lead
CDU ICDU I(150,000)(150,000)
CDU IICDU II(150,000)(150,000)
CDU IIICDU III(150,00)(150,00)
CDU IIICDU IIIDe-De-
bottleneckbottleneck(180,00)(180,00)
CDU ICDU IDe-De-
bottleneckbottleneck(180,00)(180,00)
CDU IICDU IIDe-De-
bottleneckbottleneck(180,00)(180,00)
Plant IPlant I(450,000)
Plant IPlant I De-De-
bottleneckbottleneck(700,000)
RefineryRefinery(bpd)(bpd)
RefineryRefinery(bpd)(bpd)
CrackerCracker(tpa)(tpa)
CrackerCracker(tpa)(tpa)
Co-GenCo-Gen(MW)(MW)
Co-GenCo-Gen(MW)(MW)
Co-Co-Gen Gen II
(300)(300)
Co-Gen Co-Gen IIIIII
(320)(320)
Co-GenCo-GenII-UPA II-UPA
(600)(600)
CFBCFB(300)(300)
Co-GenCo-GenII-UPCII-UPC(600)(600)
Source: Company data.
5
0
2
4
6
8
10
12
Refinery Olefins Utilities
04Q1 05Q1
06Q1 07Q1
Propylene10%
BTX2%
Ethylene12%
Fuel Oil3%
Jet Fuel/Kero8%
Naphtha5%
Electricity & Steam5%
Other Products11%
Gasoline19%
Gasoil25%
Financials
Sales Revenue by DivisionSales Revenue by DivisionSales Revenue by DivisionSales Revenue by Division Operating Profit by DivisionOperating Profit by DivisionOperating Profit by DivisionOperating Profit by Division
Historical Operating Profit by DivisionHistorical Operating Profit by DivisionHistorical Operating Profit by DivisionHistorical Operating Profit by DivisionSales Revenue by ProductsSales Revenue by ProductsSales Revenue by ProductsSales Revenue by Products
Note 1: “Other Products” includes Butadiene, LPG, MTBE, Asphalt, Sulfur and etc.
Source: Company data.
1 1
1
(NT$ billion)
Unit: NT$ billion 06Q1 (%) 07Q1 (%) Change Growth
Refinery 81.0 74% 104.2 78% 23.1 29%
Olefins 32.8 30% 35.6 27% 2.8 8%
Utilities 6.1 6% 8.2 6% 2.1 34%
Others -10.5 -10% -14.7 -11% -4.2 40%
TOTAL 109.5 100% 133.3 100% 24 22%
Unit: NT$ billion 06Q1 (%) 07Q1 (%) Change Growth
Refinery 2.68 39% 10.67 66% 8.0 298%
Olefins 3.76 54% 4.20 26% 0.4 12%
Utilities 0.35 5% 1.12 7% 0.8 223%
Others 0.14 2% 0.10 1% 0.0 -31%
TOTAL 6.93 100% 16.08 100% 9.2 132%
1
6
FinancialsSource: Company data.
Category Units 2006Q1 2007Q1 Differential
Total Assets NT$ billion 405,822 441,886 8.9%
Shareholders’ Equity NT$ billion 217,389 233,069 7.2%
Basic EPS NT$/share 0.5 1.34 0.84
Expense/Revenue % 2.11 1.96 (0.15)
Interest Coverage % 12.03 20.13 8.1
Debt Gearing % 87 90 3
7
-20
-18
-16
-14
-12
-10
-8
-6
-4
-2
0
2
4
6
8
10
12
14
16
18
20
22
24
J-06 F-06 M-06 A-06 M-06 J-06 J-06 A-06 S-06 O-06 N-06 D-06 J-07 F-07 M-07 A-07
Gasoline GasoilNaphtha-MOPJ
Jet Fuel/KeroMF180
Refining Division: Macro Environment
Crude Price IndexCrude Price IndexCrude Price IndexCrude Price Index Dubai Crude/Oil Product DifferentialsDubai Crude/Oil Product DifferentialsDubai Crude/Oil Product DifferentialsDubai Crude/Oil Product Differentials
Singapore Refining MarginSingapore Refining MarginSingapore Refining MarginSingapore Refining Margin
Source: Reuters, industry sources.
(US$/bbl)(US$/bbl)
(US$/bbl)
05
1015202530354045505560657075
J-06 F-06 M-06 A-06 M-06 J-06 J-06 A-06 S-06 O-06 N-06 D-06 J-07 F-07 M-07 A-07
NYMEX
IPE Brent
Dubai 1Mo
(4)
(2)
0
2
4
6
8
10
12
14
16
J-06 F-06 M-06 A-06 M-06 J-06 J-06 A-06 S-06 O-06 N-06 D-06 J-07 F-07 M-07 A-07
FPCC Export Raw Material Margin Singapore Simple Margin Singapore Complex Margin
8
Refining Division: Operations
CDU (180kbpd): March ~ April
CDU (150kbpd): revamped 120%
RDS (70kbpd): revamped 117~130%
RCC (73kbpd): revamped 110%
88%
98%
77%
96%
78%
05
101520253035404550556065707580859095
100105110115120125
1Q'06 2Q'06 3Q'06 4Q'06 1Q'07
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Refinery Sales Rev Utilization Rate
Refinery Sales and Utilization RateRefinery Sales and Utilization RateRefinery Sales and Utilization RateRefinery Sales and Utilization Rate 2006 Upgraded Facilities2006 Upgraded Facilities2006 Upgraded Facilities2006 Upgraded Facilities
2007 Schedule Maintenance2007 Schedule Maintenance2007 Schedule Maintenance2007 Schedule Maintenance
(NT$ million)
Source: Company data.
9
Refining Division:Product Market
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2,200
1Q06 1Q07 1Q06 1Q07
Export
Domestic
44%44%
Gasoline Gasoil
56%56%
50%50%
50%50%
14%14%
86%86%
14%14%
86%86%
Gasoline and Gasoil CracksGasoline and Gasoil CracksGasoline and Gasoil CracksGasoline and Gasoil Cracks
FPCC Gasoil Production Yield RateFPCC Gasoil Production Yield RateFPCC Gasoil Production Yield RateFPCC Gasoil Production Yield Rate
0 500 1,000 1,500 2,000 2,500
1Q06
1Q07
50ppm 500ppm 5000ppm
Source: Company data.
(‘000 KL)
Domestic vs. Export Sales VolumeDomestic vs. Export Sales VolumeDomestic vs. Export Sales VolumeDomestic vs. Export Sales Volume
0
5
10
15
20
25
J-06 F-06 M-06 A-06 M-06 J-06 J-06 A-06 S-06 O-06 N-06 D-06 J-07 F-07 M-07 A-07
Ron92 0.5%Gasoil
0.05%Gasoil
(‘000 KL)
(US$/bbl)
10
Olefins Division:Macro Environment
Global Ethylene Utilization EstimatesGlobal Ethylene Utilization EstimatesGlobal Ethylene Utilization EstimatesGlobal Ethylene Utilization Estimates Naphtha vs. Ethylene SpreadNaphtha vs. Ethylene SpreadNaphtha vs. Ethylene SpreadNaphtha vs. Ethylene Spread
Source: CMAI, Reuters, industry sources,.
(US$/MT)
0
200
400
600
800
1000
1200
1400
1600
1800
J-06
F-06
M-06
A-06
M-06
J-06
J-06
A-06
S-06
O-06
N-06
D-06
J-07
F-07
M-07
A-07
Naphtha-MOPJ
Ethylene CFR TW
11
0
200
400
600
800
1000
1200
1400
1600
1800
J-06
F-06
M-06
A-06
M-06
J-06
J-06
A-06
S-06
O-06
N-06
D-06
J-07
F-07
M-07
A-07
HDPE (inject)
EG
PP
ABS
Olefins Division: Macro Environment
Downstream SpreadsDownstream SpreadsDownstream SpreadsDownstream Spreads Regional Petrochemical PricesRegional Petrochemical PricesRegional Petrochemical PricesRegional Petrochemical Prices
Source:, Reuters, industry sources,.
(US$/MT)(US$/MT)
0
200
400
600
800
1000
1200
1400
1600
1800
J-06
F-06
M-06
A-06
M-06
J-06
J-06
A-06
S-06
O-06
N-06
D-06
J-07
F-07
M-07
A-07
Ethylene (WCP)
Propylene
Butadiene
12
Olefins Division:Plant Operation
OL#2 (1.035m tpa): undeclared
OL#1 (700ktpa): Sep ~ Oct
Quarterly Sales and Utilization Rate Quarterly Sales and Utilization Rate Quarterly Sales and Utilization Rate Quarterly Sales and Utilization Rate 2006 Schedule Maintenance2006 Schedule Maintenance2006 Schedule Maintenance2006 Schedule Maintenance
2007 Schedule Maintenance2007 Schedule Maintenance2007 Schedule Maintenance2007 Schedule Maintenance
116%
99%
108%115%117%
0
5
10
15
20
25
30
35
40
1Q'06 2Q'06 3Q'06 4Q'06 1Q07
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
110%
120%
Olefins Sales Rev Utilization Rate
Source: Company data.
(NT$ million)
13
Change Change in FPCC in FPCC Refinery Refinery Capacity Capacity and Yield and Yield
RateRate
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
450kbpd
510kbpd
520kbpd
540kbpd
LPG Naphtha JetFuel Gasoline Gasoil Fuel Oil Propylene Others
Expansion Plan:Refinery
FPCC FPCC Refinery Refinery Expan-Expan-
sionsion
ProjectProject Major ProductsMajor Products Current Current Capacity (bpd)Capacity (bpd)
Expansion Expansion (bpd)(bpd)
Aggregated Aggregated Capacity (bpd)Capacity (bpd)
Completion Completion DateDate
Base-oil Plant Baseoil,
Whiteoil
New 10,000 10,000 2008Q2
OCT Propylene 830 KTY 250 KTY 1,080 KTY 2007Q2
Capacity Revamping
Gasoil,
Naphtha
450,000 90,000 540,000 2008Q2
1
Note 1: Schedule subject to change without prior notice.
Source: Company data.
(bpd)
1
CDU capacity
14
Expansion Plan:Olefins
FPCC FPCC Olefins Olefins Expan-Expan-
sionsion
ProjectProject Major Major ProductsProducts
Current Current Capacity Capacity (KTY)(KTY)
Expansion Expansion (KTY)(KTY)
Aggregated Aggregated Capacity Capacity (KTY)(KTY)
Completion Completion DateDate
Olefins No.3 Ethylene 1,735 1,200 2,935 2007Q2
Propylene Propylene from Olefins No.3
867.5 600 1,467.5 2007Q2
Formosa Formosa Group Group Down-Down-stream stream Expan-Expan-
sionsion
CompanyCompany ProjectProject Major Major ProductsProducts
Current Current CapacityCapacity
Expansion Expansion (KTY)(KTY)
Raw Raw Material Material (KTY)(KTY)
Completion Completion DateDate
FPC AE#2 AE 108 KTY 160 Propylene 120
2008Q1
Butanol Butanol New 250 Propylene 158
2007Q4
PP (Ningbo)
PP New 450 Propylene 468
2007Q3
AE (Ningbo)
AE New 160 Propylene 112
2006Q1
NYP EG#4 EG 1,044 KTY 720 Ethylene 432
2007Q2
PO PO New 100 Propylene 80
2009
1.4BG#2 BG 40 KTY 80 Butadiene 80
2007Q2
FCFC SM#3 SM 600 KTY 720 Ethylene 207
2006Q4
1
Note 1: Schedule subject to change without prior notice.
Source: Company data.
1
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Disclaimer
This document has been prepared by Formosa Petrochemical Corporation (“FPCC” or the “Company”) solely for meetings with potential investors
The information contained in this document has not been independently verified. No representation or warranty express or implied is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of such information or opinions contained herein. None of the Company nor any of its respective affiliates, advisers or representatives shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this document or its contents or otherwise arising in connection with this document
This document does not constitute an offer or invitation to purchase or subscribe for any securities in the Company and neither any part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. Any decision to purchase securities in the offering should be made solely on the basis of the information contained in the Offering Circular
included in this document contain forward-looking statements and information relating to the Company. The Company has generally identified forward-looking statements by the use of terms such as “may”, “might”, “will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “believe” or similar words or phrases. The Company bases these statements and financial information on its beliefs as well as its assumptions made using information currently available to it. Because these statements and financial information reflect the Company’s current views concerning future events, these statements and financial information necessarily involve risks, uncertainties and assumptions. Actual future performance could differ materially from these forward-looking statements and financial information. The Company does not undertake to release the results of any revisions of forward-looking statements and financial information to reflect future events or circumstances. The Company cautions investors not to place undue reliance on these forward-looking statements. All written and oral forward-looking statements attributable to the Company or persons acting on the Company’s behalf are qualified in their entirety by these cautionary statements
No part of this document may be distributed, reproduced or transmitted to any third party