PTT Global Chemical EBITDA surges 43% in Q3

In 3Q/2013, Dubai crude price averaged at 106 USD/BBL, rose from previous quarter by 5 USD/BBL or 6% due to the anticipation of lower supply with concern on unrest in Middle East and North Africa. This caused prices of most petroleum and petrochemical products to rise from previous quarter. Refinery business had a higher spread of petroleum product over Dubai crude price which resulted in an increase in Market GRM to 3.49 USD/BBL from 2.38 USD/BBL from previous quarter.

The CDU utilization rate in 3Q/2013 was 98%. Aromatics Business had gross margin (P2F) of 260 USD/ton, decreased from previous quarter at 325 USD/ton due to lower spreads of paraxylene and benzene over condensate resulted from the ease in supply tightness of paraxylene and benzene. The BTX utilization rate was at 91%.

Olefins business had utilization rate of 75%, down from previous quarter due to the lower feed of natural gas from unplanned shutdown of PTT Public Company Limited’s (“PTT”) GSP#5. Polyethylene utilization rate was at 88% due to unplanned 78-day shutdown of LDPE plant resulting in less excess output of olefins. HDPE price averaged at 1,489 USD/ton for this quarter or increased 3% from previous quarter.

In 3Q/2013, the Company had stock gain (Net NRV) up to 3,768 MB from increasing in crude price during the quarter and Thai Baht depreciation. In addition, the Company realized Oil Spill expenses and its provision of 1,059 MB in this quarter.

As a result of the market situation and business operations mentioned earlier, in this 3Q/2013, the Company reported EBITDA of 16,388 MB, increased from 2Q/2013 by 43% while the EBITDA margin of this quarter was 12%.

Summary of the Company’s major events that had significant impact on the financial statements of 3Q/2013, 3Q/2012, and 2Q/2013 are as follows:

- In 3Q/2012, the purchase price adjustment (PPA) for the investment of NatureWorks and Vencorex on May 31, 2012 was restated.

The valuation of the PPA was completed at the end of 4Q/2012, thus the accounting standard required the Company to realize the adjusted PPA on the investment date, and therefore 3Q/2012 financial statements were restated.

- On January 10, 2013, PTT Utility Company Limited (“PTTUT”) amalgamated with Independent Power (Thailand) Company Limited (“IPT”) and became Global Power Synergy Company Limited (“GPSC”) which diluted the Company’s shareholding portion from 60% to 30.31%.

In this regard, the Company has changed the method of recording transaction from recognition of all revenue & expenses of PTTUT’s profit and loss into the Company’s consolidated financial statement (Consolidation) to realizing only gain/loss of the investment portion in to the Company’s financial statements (Take equity). This method has been applied since 1Q/2013. However, year-on-year comparison is based on different accounting basis

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PTT Global Chemical