2q18 opportunity day - set · 2,000 2,500 1q17 2q17 3q17 4q17 1q18 2q18 jul'18 fy17 ... (1 st...

2Q18 Opportunity Day

Wednesday August 22rd, 2018

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 described

herein. 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 and

financial performance. Actual financial performance of the entities described herein could differ

materially from that projected in the forward-looking statements due to the inherent uncertainty of

estimates, forecasts and projections, and financial performance may be better or worse than

anticipated. Given these uncertainties, readers should not put undue reliance on any forward-looking

statements.

Forward-looking statements represent estimates and assumptions only as of the date that they were

made. The information contained in this presentation is subject to change without notice and GGC

does not undertake any duty to update the forward-looking statements, and the estimates and

assumptions associated with them, except to the extent required by applicable laws and regulations.

Agenda

Highlights

GGC Growth Project

Palm Oil Market Update

Financial Performance

2Q18 Highlights

Palm Oil Market UpdatesGGC Growth ProjectHighlights

Key HighlightsKey Highlights

+ Both ME & FA plants utilized at full capacity+ Both ME & FA plants utilized at full capacity

FA Business Unit:+ Natural FA prices were in competitive range

to Synthetic FA

+ Improved FA sales volume 9% yoy

+ THB Depreciation over USD

FA Business Unit:+ Natural FA prices were in competitive range

to Synthetic FA

+ Improved FA sales volume 9% yoy

+ THB Depreciation over USD

- CPO & CPKO price continue downward trend

- Core Performance:

• Consoled Adj. EBITDA -56%yoy• ME Adj. EBITDA -36%yoy

• FA Adj. EBITDA -64%yoy

- CPO & CPKO price continue downward trend

- Core Performance:

• Consoled Adj. EBITDA -56%yoy• ME Adj. EBITDA -36%yoy

• FA Adj. EBITDA -64%yoy

ME Business Unit:+ Mandate of B7

+ Improved ME sales volume 5% yoy

● B20 has been implemented on 2nd July 2018

ME Business Unit:+ Mandate of B7

+ Improved ME sales volume 5% yoy

● B20 has been implemented on 2nd July 2018

- Issue on raw material procurement- Issue on raw material procurement


GGC Feedstock Management Going Forward

Highlights

Refinery GGC FA

Suppliers DP

GGC ME1

CurrentCurrent

Refinery

Refinery

GGC ME2

Going ForwardGoing Forward

Benefits:

- Shorten Inventory lead time,

consequent to lower WC and reduces

performance volatility.

Benefits:

- Shorten Inventory lead time,

consequent to lower WC and reduces

performance volatility.

DPSuppliersGGC ME1

GGC FA

Refinery

Palm Oil Market Updates Financial PerformanceGGC Growth Project

4.95 5.14 5.13 5.06 5.13

2Q17 1Q18 2Q18 6M17 6M18

25.84

20.34 20.78

28.31

20.56

2Q17 1Q18 2Q18 6M17 6M18

2Q18 Operation Highlights

Highlights

CPO (DIT) : THB/KgCPO (DIT) : THB/Kg

ME (EPPO) : THB/LtME (EPPO) : THB/Lt

METHYL ESTER (B100) BUSINESS UNITMETHYL ESTER (B100) BUSINESS UNIT

Biodiesel MandateBiodiesel Mandate

ME EPPO P2F : THB/KgME EPPO P2F : THB/Kg

GGC’s ME Operational PerformanceGGC’s ME Operational Performance

Plant Utilization Rate

Adjusted EBITDA (MB)

Sales Volume (Tons)2Q17 1Q18 2Q18 6M17 6M18

B7

B5,B7

B5,B7

B7 B7

THB/Kg 2Q17 1Q18 2Q18 6M17 6M18

ME EPPO 34.38 28.51 28.94 36.96 28.72

29.74

24.66 25.03

31.97

24.85

2Q17 1Q18 2Q18 6M17 6M18

106% 119% 108%96%

113%

2Q17 1Q18 2Q18 6M17 6M18

85,879 102,754 90,100 155,084

192,854

2Q17 1Q18 2Q18 6M17 6M18

182 180 116345 296

2Q17 1Q18 2Q18 6M17 6M18


2Q18 Operation Highlights

Highlights

FATTY ALCOHOLS BUSINESS UNITFATTY ALCOHOLS BUSINESS UNIT

CPKO (MPOB) : USD/TonCPKO (MPOB) : USD/Ton

FA (ICIS) : USD/TonFA (ICIS) : USD/Ton

Natural Fatty Alcohols regainedCompetitiveness vs. Synthetic onesNatural Fatty Alcohols regainedCompetitiveness vs. Synthetic ones

FA Market P2F : USD/TonFA Market P2F : USD/Ton

GGC’s FA Operational PerformanceGGC’s FA Operational Performance

Plant Utilization Rate

Sales Volume (Tons)

Synthetic FA (C1215) Price : USD/Ton

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

Crude Oil Price (WTI) : USD/BBL

Ethylene Price (USGC) : USD/Ton

1,783 1,784 1,5702,013

1,677

2Q17 1Q18 2Q18 6M17 6M18

584

419 465 504442

2Q17 1Q18 2Q18 6M17 6M18

4863 68

5065

2Q17 1Q18 2Q18 6M17 6M18

2,657 2,381 2,2492,557 2,315

1,802 2,160 1,786

2,154 1,973

2Q17 1Q18 2Q18 6M17 6M18

27,643 24,235 30,209 47,533 54,444

2Q17 1Q18 2Q18 6M17 6M18

471264

170

652434

2Q17 1Q18 2Q18 6M17 6M18

703 669582

716626

2Q17 1Q18 2Q18 6M17 6M18

113% 101%120%

101% 110%

2Q17 1Q18 2Q18 6M17 6M18

999 1,138 921

1,258 1,029

2Q17 1Q18 2Q18 6M17 6M18

Adjusted EBITDA (MB)


Agenda

Highlights

GGC Growth Project



3Q18 Highlights of Palm Oil & Oleochemicals Market

Highlights

ME Chain ME Price & Spread

FA Price & Spread FA Chain

5.17 4.95 4.80 4.93 5.14 5.13 5.27 4.96

39.54

34.38

30.45 28.62 28.51 28.94

30.53 33.25

30.78

25.84

22.43 20.48 20.34 20.78 21.59

24.89

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 Jul'18 FY17

THB/KG Spread ME CPO

424 584

433 488 419 465 442 483

2,243

1,783 1,820

2,054

1,784

1,570 1,487

1,975

1,516

999 1,156

1,304 1,138

921 871

1,244

0

500

1,000

1,500

2,000

2,500

1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 Jul'18 FY17

USD/T Spread FA CPKO

ME:

• ME demand is expected to decline in Q3/18 due to;

Low Biodiesel demand in rainy season Some Biodiesel producers use ME stock to produce B7

B20 has small effect to market demand as distribution channel

is limited. (1st Target 6 MLPD vs estimated actual 1 MLPD)

CPO:• Local CPO price trend to be weak-to-stable due to upcoming

harvest period during end of Aug’18-Sep’18

• According to DIT, local CPO stock is lower than 400,000T for the

fist time in this year;

Jun’18 : 379,672T

FA:• Natural FA demand is quite stable in Q3/18

• Overall supply is tight; Some Chinese producers remained have issue with

environment and safety regulations

Indian producers have low operating rate as they cannot

reach competitive feedstock due to high palm oil import tax

• Natural FA price is still more competitive than Synthetic FA Q3/18 contract price

CPKO:

• CPKO price shall move in narrow range as there is no new

supporting fundamentals in the market • Palm stock in Indonesia and Malaysia remained high


Agenda

Highlights

GGC Growth Project



Projects Timeline

Highlights

Refined GlycerinePlant 220 KTA

Project Methyl EsterPlant 2

Refined GlycerinePlant 2

Oleo Specialties BiocomplexPhase 1

Capacity Methyl Ester200 KTA

Refined Glycerine20 KTA

14 KTA Sugarcane : 2.4 mm TPAEthanol : 186 mm LPA

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

Project Progress Update 100% Construction,Commissioning Test

Contactor Bidding Feasibility Study FID : 3Q18

Scheduled COD End of August 2018 4Q19 Target 2Q20 Early of 1Q21

Methyl Ester Plant 2200 KTA

BiocomplexPhase 1

Sugarcane : 2.4 mm TPA

Ethanol : 186 mm LPA

Oleo Specialties14 KTA

2018End

2019End

2020End


Projects Timeline

Highlights

Progress :

- Pretreatment unit commissioning completed. The

product Refined palm oil (RPO) show FFA 0.01% from

Feed FFA 10.0%- Bio-diesel Unit (Methyl ester) commissioning

completed. The 1st product bio-diesel (B100) run down

to storage tank

Next Action : Request 2 licenses required from DOEB

1) Anti-oxidation license (expected to get license within

mid of Aug)2) Production and distribution license (expected to get

license within early of Sep)

Timeline/Completion Date :

COD/Plant Acceptance within Aug 18

Methyl Ester Plant2


Project Construction Progress

Highlights

Methyl Ester Plant 2Methyl Ester Plant 2


Projects Timeline

Q4

2018

Ror Ngor.4

& BOI

APPROVAL

Q4

2018

FID

STAGE

Q1

2019

EIA

APPROVAL

PLANT CONSTRUCTION

≈23 months

Early of Q1

2021

COMMISSIONING

& COD

Progress : In July 2018, the cabinet approved as following;

- To amend Sugar Act. 2527-on using of sugar cane to be produced products other than sugar

- To add “exceptional clause” in the Notification of the Ministry of Industrial about the location of

factory that using sugar cane as raw material in Thailand 2559 must have a distance between each factory at least 50 km. The exceptional clause is “except the factory in such

location provide consent to the other”.

Next Action : Proceed project to BoD for FID

BIOCOMPLEX

Palm Oil Market Updates Financial PerformanceGGC Growth ProjectHighlights

Agenda

Highlights

GGC Growth Project



1.5% 1.4%

-43.7%

2.4%-20.2%

Consolidated Financial Performance

Highlights

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

2Q182Q17 1Q18 6M17

ME EBITDA ME Adjusted EBITDA FA EBITDA FA Adjusted EBITDA

Consolidated Adjusted EBITDA Margin

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

2,903 2,774 2,690

5,546 5,464

1,923 1,857 1,546

3,527 3,403

4,826 4,631 4,236

9,073 8,867

2Q17 1Q18 2Q18 6M17 6M18

ME Business Unit FA Business Unit

71 64

-1,853

216

-1,789

2Q17 1Q18 2Q18 6M17 6M18

6M18

13.5%

9.6%

6.8%

11.0%8.2%

65

182 163 180 106 116

196

345 269 296 163

471

48

264

31

170

343

652

79

434

228

653

211

444

137

286

540

998

348

730


Financial Position

Highlights

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

June 30, 2018

Baht 12,842 million

December 31, 2017

Baht 14,535 million

Key Financial Ratios

Repayment Plan Cash Flows

Million Baht

Million Baht

Million Baht

528

935

(2,292)

2,575 1,745

*

*Cash from IPO was invested in ME2 project of 900 MB and WC 96 MBEnding Cash had not included short-term investment of 1,738MB

9,058 7,923

11,073 11,137 9,080

833 2,689

2,400 2,399

2,258

FY15 FY16 FY17 1Q18 2Q18

0.10.3 0.2 0.2 0.2

0.6

1.82.1 2.3 2.4

2,422

745

2,300

Beginning

Cash

Operating

Cash Flows

CAPEX &

Investment

Financing Ending

Cash

-483

140

338

441

567

765

2018 2019 2020 2021 2022

-384


Performance 2Q18 vs. 2Q17

Highlights

Net Profit : Million Baht

Overall operating profit in 2Q18 was lower than 2Q17, mainly attributed to the lower profitability of Fatty Alcohols driving by lower market P2F margin and profitability of ME due to high competition.

Stock Gain (Loss) & NRV in 2Q18 was recognized stock loss & NRV of 149 MB improved from 2Q17 by 277 MB, mainly due to the slower pace of downward trend of crude palm oil prices and

crude palm kernel oil price.

Gain/(Loss) from FX in 2Q18 was recorded gain of 44 MB improved from 2Q17 by 70 MB due to

the impact from the depreciation of the THB, in which the THB was depreciated from 31.2 THB/USD

in April-18 to 33.2THB/USD in June-18 or 6 % depreciation.

-1,853


Performance 2Q18 vs. 1Q18

Highlights


Overall operating profit in 2Q18 was lower than 1Q18, attributed to the lower profitability of ME due to lower ME sales volume and lower profitability of FA due to different product portion sold.

Stock Gain (Loss) & NRV in 2Q18 was recognized stock loss & NRV of 149 MB improved from 1Q18 by 84 MB, mainly due to the slower pace of downward trend in crude palm kernel oil price.

Gain/(Loss) from FX in 2Q18 was recorded gain of 44 MB improved from1Q17 by 71 MB due to the impact from the depreciation of the THB, in which the THB was depreciated from 31.2 THB/USD

in April-18 to 33.2THB/USD in June-18 or 6 % depreciation.

-1,853


Performance 6M18 vs. 6M17

Highlights


Overall operating profit in 6M18 was lower than 6M17, mainly attributed to the lower profitability of FA due to lower market P2F and slightly lower profitability of ME due to CPO price decreased.

Stock Gain (Loss) & NRV in 6M18 was recorded stock loss & NRV of 382 MB improved from 6M17 by 77 MB, mainly due to the slower pace of downward trend in palm product price.

Gain/(Loss) from FX in 6M18 was recorded gain of 17 MB improved from 6M17 by 68 MB due to the impact from the depreciation of the THB.

-1,789


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, ThailandTel: +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

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

15

.00

20

.00

25

.00

30

.00

35

.00

40

.00

45

.00

Jan-16

Feb-16

Mar-16

Apr-16

May-16

Jun-16

Jul-16

Aug-16

Sep-16

Oct-16

Nov-16

Dec-16

Jan-17

Feb-17

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-17

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Mar-18

Apr-18

May-18

Jun-18

Jul-18

CP

O_

DIT

CP

O_

DIT

(B/k

g)

Pa

lm O

il & O

leo

ch

em

ica

ls M

ark

et

Page 2

3

CPKO CPO

2016

2017

2018

924

1,002

1,156

1,286

1,205

1,304

1,276

1,438

1,481

1,375

1,515

1,625

1,776

1,584

1,188

950

1,065

982

989

1,126

1,352

1,332

1,338

1,243

1,256

1148

1009

987

925

851

871

-

20

0

40

0

60

0

80

0

1,0

00

1,2

00

1,4

00

1,6

00

1,8

00

2,0

00

Jan-16

Feb-16

Mar-16

Apr-16

May-16

Jun-16

Jul-16

Aug-16

Sep-16

Oct-16

Nov-16

Dec-16

Jan-17

Feb-17

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-17

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Mar-18

Apr-18

May-18

Jun-18

Jul-18

CP

KO

CP

KO

(US

D/T

on

)

0

200

400

600

800

1000

1200

Spread RGL CGL

Palm Oil & Oleochemicals Market

GGC Going Forward

Gly

ce

rin

e

2016 2017 2018

Go to pg.11

2Q2018 2Q2017 % yoy 1Q2018 % qoq 6M2018 6M2017 % yoy

Utilization (%) 120% 113% 7% 101% 19% 110% 101% 9%

Sales Volume (Ton) 30,208 27,643 9% 24,235 25% 54,444 47,533 15%

Revenue from Sales (million baht) 1,546 1,923 -20% 1,857 -17% 3,403 3,527 -4%

EBITDA (million baht) 31 163 -81% 48 -35% 79 343 -77%

EBITDA margin(%) 2.0% 8.5% -6.5% 2.6% -0.6% 2.3% 9.7% -7.4%

Stock Gain/(Loss) & NRV -139 -308 -55% -216 -36% -355 -309 15%

Adjusted EBITDA (million baht)(1)

170 471 -64% 264 -36% 434 652 -33%

Adjusted EBITDA Margin (%) 11.0% 24.5% -13.5% 14.2% -3.2% 12.8% 18.5% -5.7%

Key Performance By Business Unit

ME

TH

YL

ES

TE

R (

B100)

BU

SIN

ES

S U

NIT

ME

TH

YL

ES

TE

R (

B100)

BU

SIN

ES

S U

NIT

FA

TT

Y A

LC

OH

OL

S B

US

INE

SS

U

NIT

FA

TT

Y A

LC

OH

OL

S B

US

INE

SS

U

NIT

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

(2) Conversion ratio: 0.865 Tons = c.1,000 Liters

(3) Adjusted EBITDA refers to EBITDA excluding impact of Stock Gain/(Loss) and NRV Note : (1) Nameplate Capacity 300,000 Tons per year


Note : (1) Nameplate Capacity 300,000 Tons per year


2Q2018 2Q2017 % yoy 1Q2018 % qoq 6M2018 6M2017 % yoy

Utilization (%)(1)

108% 106% 2% 119% -11% 113% 96% 17%

Sales Volume (ton) 90,100 85,879 5% 102,754 -12% 192,854 155,084 24%

Sales Volume (million litre)(2)

104 99 5% 119 -13% 223 179 25%

Sales Revenue (million baht) 2,690 2,903 -7% 2,774 -3% 5,464 5,546 -1%

EBITDA (million baht) 106 65 63% 163 -35% 269 196 37%

EBITDA margin (%) 3.9% 2.2% 1.7% 5.9% -2.0% 4.9% 3.5% 1.4%

Stock Gain/(Loss) & NRV(million baht) -10 -117 -91% -17 -41% -27 -149 -82%

Adjusted EBITDA (million baht)(3)

116 182 -36% 180 -36% 296 345 -14%

Adjusted EBITDA Margin (%) 4.3% 6.3% -2.0% 6.5% -2.2% 5.4% 6.2% -0.8%

MB % MB % MB % MB % MB %

Sale Revenue 4,236 100 4,826 100 (590) (12) 4,631 100 -395 (9)

Feedstock (3,285) (78) (3,540) (73) 255 (7) (3,522) (76) 237 (7)

Net Realizable Value (NRV) 0 - (19) (0) 19 (100) 2 0 (2) (100)

Product to Feed Margin 951 22 1,267 26 (316) (25) 1,111 24 (160) (14)

Variable Costs (485) (11) (421) (9) (64) 15 (495) (11) 10 (2)

Fixed Costs (130) (3) (137) (3) 7 (5) (126) (3) (4) 3

Stock Gain/(Loss) (149) (4) (407) (8) 258 (63) (235) (5) 86 (37)

SG&A (83) (2) (85) (2) 2 (2) (72) (2) (11) 15

Other Income 33 1 11 0 22 200 28 1 5 18

EBITDA 137 3 228 5 (91) (40) 211 5 (74) (35)

Depreciation and Amortization (133) (3) (141) (3) 8 (6) (139) (3) 6 (4)

EBIT 4 0 87 2 (83) (95) 72 2 (68) (94)

Net Financial Costs (8) (0) (15) (0) 7 (47) (5) (0) (3) 60

FX Gain/Loss (1) 44 1 (26) (1) 70 (269) (27) (1) 71 (263)

Share of Profit/(Loss) from investment 27 1 16 0 11 69 20 0 7 35

Income Tax Expenses 0 - 9 0 (9) (100) 4 0 (4) (100)

Net Profit bef extra items 67 2 71 1 (4) (6) 64 1 3 5

Extra item net of tax(2) (1,920) (45) - - (1,920) na. - - (1,920) na.

Net Profit after extra items (1,853) (44) 71 1 (1,924) (2,710) 64 1 (1,917) (2,995)

1Q2018 qoq2Q2018 2Q2017 yoy

Consolidated Income Statement

Consolidated Income Statement

MB % MB % MB %

Sale Revenue 8,867 100 9,073 100 (206) (2)

Feedstock (6,807) (77) (6,886) (76) 59 (1)

Net Realizable Value (NRV) 2 0 (19) (0) 21 (111)

Product to Feed Margin 2,062 23 2,168 24 (106) (5)

Variable Costs (980) (11) (776) (9) (204) 26

Fixed Costs (256) (3) (276) (3) 20 (7)

Stock Gain/(Loss) (384) (4) (440) (5) 56 (13)

SG&A (155) (2) (155) (2) - -

Other Income 61 1 21 0 40 190

EBITDA 348 4 540 6 (192) (36)

Depreciation and Amortization (272) (3) (278) (3) 6 (2)

EBIT 76 1 261 3 (185) (71)

Net Financial Costs (13) (0) (37) (0) 24 (65)

FX Gain/Loss (1) 17 0 (51) (1) 68 (133)

Share of Profit/(Loss) from investment 47 1 46 1 1 2

Income Tax Expenses 4 0 (3) (0) 7 (233)

Net Profit bef extra items 131 1 216 2 (85) (39)

Extra item net of tax(2) (1,920) (22) - - (1,920) na.

Net Profit after extra items (1,789) (20) 216 2 (2,005) (928)

6M2018 6M2017 yoy

2q18 opportunity day - set · 2,000 2,500 1q17 2q17 3q17 4q17 1q18 2q18 jul'18 fy17 ... (1 st...

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