Kaset Thai International Sugar Corporation PCL 22 February 2019 Page 1 of 19
Important Notice This presentation is confidential. This presentation is not a prospectus. This presentation does not constitute or form part of any offer for sales or solicitation of any offer to buy any securities nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever. This presentation has been prepared for the purpose of providing certain individuals with business, financial and other information concerning Kaset Thai International Sugar Corporation Company Limited (“KTIS”) The information contained in this presentation is intended solely for your personal reference only. If you are not an intended recipient, you must not read, disclose, copy, circulate, retain, distribute or take any action in reliance upon this material. This presentation is not intended to substitute your own analysis and investigation, and should not be considered a recommendation to any recipient of this presentation. Some statements contained herein are forward-looking statements identified by the use of forward- looking terminology such as “may” , “will” , “expect” , “anticipate”, “intend” , “estimate” , “continue”, “plan” or ot her similar words, which are subject to various risks and uncertainties. These statements include statements with respect to KTIS’s corpo rate plans, strategies and beliefs and other statements that are not historical facts. This presentation is prepared based on the assumptions and beliefs of KTIS’s management in light of the information currently available to KTIS involving risks and unce rtainties which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Nothing in this presentation is, or shall be relied on as promise or representation of KTIS as to the future. For more information, contact : IR@ktisgroup.com Page 2 of 19
Agenda Q1-2019 Operating Results Sugar & Bio Industrial Trends Page 3 of 19
Q1-2019 Operating Results Page 4 of 19
Summary of Operating Results - 1 Total Revenues Total Expenses Net Profit Unit: Baht million Income Tax Benefits Income tax expenses Net Profit Other Income Financial Costs Sales & Services Revenues Selling & Admin. Expenses Cost of Sales & Services 2,799 799 2,350 350 3,000 2,934 34 183 183 2,843 43 20 20 110 110 2,000 69 69 65 65 630 2,616 616 770 2,219 219 1,000 2,269 2,00 005 0 -196 196 Q1-2018 1-2018 Q1-2019 1-2019 Q1 Q1-20 -2018 Q1 Q1-20 -2019 (Oct.-Dec.2017) (Oct.-Dec.2018) (Oct.-Dec.2017) (Oct.-Dec.2018) -495 495 -500 Q1 Q1-20 -2018 Q1 Q1-20 -2019 (Oct.-Dec.2017) (Oct.-Dec.2018) Total revenues increased due to higher revenues from both sugar business and bio business Total expenses increased due to higher cost of sales & services which in line with higher sales & services revenues Net loss was less than last year Page 5 of 19
Summary of Operating Results - 2 Sales & Service Revenues Gross Profit & Margin Unit: Baht million 2.4% 2.1% GP - Sugar GPM - Sugar GP - Bio GPM - Bio 17.7% Sugar 400 40% Paper Pulp 347 347 Q1-2018 Ethanol 30% 201 201 214 214 Electricity 16.7% 21.6 .6% 61.1% 200 20% 62 62 Others 11.2 .2% 10% 8.7% 7.2% 152 152 146 146 3.1% 3.7% 0 0% Q1-2018 1-2018 Q1-2019 1-2019 13.8% (Oct.-Dec.2017) (Oct.-Dec.2018) Sugar Paper Pulp Q1-2019 Ethanol 15.1% Electricity 64.3% Others Page 6 of 19
Sugar Revenue Sugar Revenue Sugar Sales Volume (‘000 Ton) & Price (Baht) Unit: Baht million Sugar - Domestic Domestic Sales Volume Domestic Selling Price * Sugar - International International Sales Volume International Selling Price 1,684 684 200 2,000 Molasses 19,5 ,507 1,356 356 116 116 17,5 ,565 18,000 17,3 ,383 51 51 127 127 265 265 804 804 100 1,000 69 69 79 79 13,000 15 15 1,040 040 764 764 10,1 ,147 53 53 47 47 0 8,000 0 Q1-2018 1-2018 Q1-2019 1-2019 Q1-2018 1-2018 Q1-2019 1-2019 (Oct.-Dec.2017) (Oct.-Dec.2018) (Oct.-Dec.2017) (Oct.-Dec.2018) Molasses Sales Volume (‘000 Ton) & Price (Baht) Production 2017/18 2018/19 Molasses Sales Volume Molasses Selling Price Thailand Cane 134.9 86.1 MMT 40 4,105 105 Sugar 147.1 91.4 MBg 4,000 30 Molasses 5.5 3.4 MMT 3,092 092 20 KTIS Cane 11.6 6.5 MMT 3,000 Sugar 11.9 6.4 MBg 10 37 37 12 12 Molasses 0.5 0.3 MMT 0 2,000 Q1-2018 1-2018 Q1-2019 1-2019 Source: Office of the Cane and Sugar Board, 19 February 2019 (Oct.-Dec.2017) (Oct.-Dec.2018) Note: * white & refined sugar selling price only Page 7 of 19
Pulp Revenue Pulp Revenue Sales Volume (ton) & Selling Price (Baht) Pulp - Domestic Domestic Sales Volume Domestic Selling Price Unit: Baht million Pulp - International International Sales Volume International Selling Price 394 394 17,418 418 371 371 16,364 364 400 24,1 ,170 24,000 23,6 ,644 320 320 14,560 560 310 310 10,000 200 13,249 249 22,000 21,3 ,332 21,2 ,274 74 74 61 61 3,115 115 2,858 858 0 0 20,000 Q1-20 Q1 -2018 Q1 Q1-20 -2019 Q1-20 Q1 -2018 Q1 Q1-20 -2019 (Oct.-Dec.2017) (Oct.-Dec.2018) (Oct.-Dec.2017) (Oct.-Dec.2018) Pulp revenue increased as a result of higher average bagasse pulp selling price even though lower pulp sales volume Page 8 of 19
Ethanol Revenue Ethanol Revenue Sales Volume (‘000 Liter) & Selling Price (Baht) Ethanol - Domestic Domestic Sales Volume Domestic Selling Price Unit: Baht million Ethanol - International International Sales Volume International Selling Price 20,000 30 15,650 650 15,301 301 393 393 362 362 400 25.6 .67 25 23.1 .10 10,000 200 20 0 15 0 Q1-20 Q1 -2018 Q1 Q1-20 -2019 Q1-20 Q1 -2018 Q1-20 Q1 -2019 (Oct.-Dec.2017) (Oct.-Dec.2018) (Oct.-Dec.2017) (Oct.-Dec.2018) Ethanol revenue decreased due to lower average selling price Page 9 of 19
Electricity Revenue Electricity Revenue Electricity Supplied (MWH) & Selling Price (Baht) Electricity Revenue Electricity Supplied Selling Price Unit: Baht million 50,000 3.10 3.05 100 3.01 01 3.00 2.90 81 81 26,980 80 53 53 2.80 17,318 18 0 0 2.70 Q1-2018 1-2018 Q1-2019 1-2019 Q1-2018 1-2018 Q1-2019 1-2019 (Oct.-Dec.2017) (Oct.-Dec.2018) (Oct.-Dec.2017) (Oct.-Dec.2018) Revenue from electricity business increased, as a result of higher electricity sold, despite lower average electricity selling price per unit Page 10 of 19
Sugar & Bio Industry Trends Page 11 of 19
Positive Factors for Sugar The global balance will switch from surplus at around 9.8 million tons for 2017/18 season to balance in 2018/19 season, with chance to get to deficit almost 6.0 million tons in 2019/20 season, largely due to global consumption growth and a large fall in Indian production from 31.5 million tons in 2018/2019 to 26.5 million tons in 2019/2020 WTI crude oil has gained around 20%, recovering from a low of USD 43/bbl reached at the end of Dec to USD 55/bbl. currently The Brazilian real has strengthened 6%, recovering from BRL 3.94/USD reached at the early of Dec to BRL 3.7/USD. Page 12 of 19
Negative Factors for Sugar Another big crop be expected in India, which will still reach 30.5 - 31.5 million tons in 2018/19, although ISMA reduced their estimate. And India is expected to export 5 million tons in 2018/19. Ethanol parity is around 13c/lb and will be below 13c/lb in the middle of the year. Sweetener tax in Thailand is stagnating industrial sugar consumption in domestic market. Page 13 of 19
World Sugar Price – 10 Years Source: Reuters Page 14 of 19
World Sugar Price – 5 Years Source: Reuters Page 15 of 19
Production Surplus/Deficit World Sugar Supply / Demand Balance Source: LMC Page 16 of 19
Brazilian Real / USD vs. ICE No.11 Exchange rate(R$/US$) Sugar Price (cent/lb) Source: Reuters Page 17 of 19
Price Comparison (2013 – 2018) Eucalyptus Pulp & Bagasse Pulp 450 550 650 750 850 Jan-13 Apr-13 Jul-13 Oct-13 Bagasse ( Baga Euc Eucal Jan-14 alyptus Apr-14 ptus ( e (CF Jul-14 CFR) (CIF CIF) R) Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Source: RISI + Company Apr-18 Jul-18 Oct-18 Jan-19 Page 18 of 19
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