Polyplex (Thailand) PLC (PTL) Financial Results and Summary FY 2018-2019 30 th May, 2019
A Brief Introduction on Polyplex the Group* Varied Product Mix 1600 2000+ Upstream - PET Resin Customers in Employees from 30+ Years of Film - Thin PET, Thick PET, Focus on 70 Countries BOPP , Blown, CPP varied nationalities Experience in the Sustainability Downstream - Metallizing, across Europe, Americas, working in industry Silicone Coating, the Middle East, Asia and O ffl ine Coating, the harmony Extrusion Coating, Indian Subcontinent Holography & Transfer Metallized Paper *Includes India (PCL - Parent Company)
A Global Presence KOREA NETHERLANDS USA JAPAN TURKEY MEXICO CHINA INDIA 6 Manufacturing MALAYSIA SINGAPORE THAILAND Facilities INDONESIA In 5 Countries Parent Company Manufacturing Locations Upcoming Manufacturing Location with Multiple Warehouses & Liaison Offices Worldwide Warehouse Liaison/Trading/Representative Offices
Where we are in the Value Chain Sachet Pack Susceptor Film Stand Up Pouch Can Lamination P NATURAL BASIC RAW PLASTIC & INTERMEDIATE RESOURCES PETROCHEMICALS MATERIALS PRODUCTS A C K A MEG Ethylene Easy Peeling Lids Aroma Pack Spouted Pack Ready 2 Eat Pack G I N G Film Packaging & Industrial Customers Grade PET Natural Gas Resin PV Backsheets Electrical Grade Electronic Grade Window Films I Coating N D Paraxylene PTA U S Base Metallizing Films T Optical Grade Liner Grade Construction Graphics R PP Resin I Polypropylene A Oil Holography L
PTL Capacities* Thailand Turkey USA Indonesia BASE FILM 8,845 (MT) 10,000 PET Thin 28,800 PET Thick 58,000 CPP 44,000 42,000 31,000 Blown Film Upstream: 80,500 75,850 73,000 57,600 PET Resin (MT) Downstream: Metallizer (MT) 21,700 985 17,700 Coating (Mn Sqm) 9,500 6,000 Holographic (MT) 140 480 * Including all upcoming capacities
Financial Summary Q4 2018-19 FY 2018-19 3,663 (10% YoY) 14,746 (16% YoY) Revenue (Mn THB) 725 (21% YoY) 2,792 (19% YoY) EBITDA* (Mn THB) 20% 19% EBITDA* Margin 0.56 2.08 (31% YoY) EPS* (THB) Credit Rating at A- (Tha) with “Stable Outlook” from Fitch Thailand Other * EBITDA/EPS Normalized for FX Gains/Losses
FY 2018-19 YoY Financial Highlights Net Profit* D/E** 31% -9% 1,874 M THB 0.15 YoY YoY ROCE* ROE* 330 330 15% 17% bps bps *Normalized for FX Gains/Losses **D/E Net of Cash including only long term and short term debt
Production Production Qty YoY % Change Product Mix 5% PET Thin 2% 6% 12% 12% PET Thick BASE FILMS -4% CPP 80% 57% Blown Film FY 18-19 Metallized 8% 16% Offline Coater 42% VALUE ADDED FILMS 17% Saralam 10% 63% 3% Saracote 6%
High VA Products & Applications 16% 24% 28% Sales Volume 72% 76% 84% FY 18-19 FY 16-17 FY 17-18 32% 28% 32% EBITDA* 68% 68% 72% HVAS All Other Film *Normalized for FX Gains/Losses
High VA Products and Applications 80% 3,000 900 60% 2,250 675 40% 1,500 450 20% 750 225 0% 0 0 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 Incremental Margin From HVAS (THB Million) HVAS Incremental Margin EBITDA* (THB Million) as a % of EBITDA •HVAS Continue To Have Increasing Impact Over Time •HVAS Help Protect Against The Cyclicality Of The Industry •Continued Investment In Growing HVAS In Terms Of Absolute Numbers (Indonesian Investment Will Impact % Of HVAS Margin) *Normalized for FX Gains/Losses
EBITDA Trend 775 5,000 40% 19%. 706 3,750 30% 2,500 20% 638 1,250 10% 569 0 0% 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 Q4 '17-18 Q3 '18-19 Q4 '18-19 EBITDA* (THB Million) As a % of Revenue •Highest EBITDA Margin in the last 5 years •Partly due to the improved margins on Standard Film •Increased HVAS Proportions Have Also Contributed To EBITDA Growth *Normalized for FX Gains/Losses
EPS Trend 0.60 31% 4.82 0.45 0.30 2.08 1.85 1.59 1.22 1.18 1.14 1.07 0.15 0.37 0.28 -0.11 -0.12 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 Q4 '17-18 Q3 '18-19 Q4 '18-19 EPS* •Following EBITDA Growth - EPS is Also The Highest In The Last 10 Years (Excepting ’10-11) Despite The Dilution Due To Rights Issue In 2016 *Normalized for FX Gains/Losses
ROCE & D/E 0.78 0.8 16% 15.14% 0.59 0.6 12% 12.3% 0.4 8% 9.14% 0.26 7.35% 0.17 0.2 0.15 4% 2.03% 0 0% 2014-15 2015-16 2016-17 2017-18 2018-19 2014-15 2015-16 2016-17 2017-18 2018-19 ROCE* Leverage Ratio (D/E)** •Financially Strong Balance Sheet With Low Leverage Ratio •D/E Ratio Expected To Remain Stable Despite Indonesia Debt *Annualized and Normalized for FX Gains/Losses **D/E Net of Cash including only long term and short term debt
Regional Overview Asia Fastest Growing Region Industry Dynamics Improving Chinese Margins and therefore Industry-wide margins also improving USA ASIA PTL poised to capture market growth with upcoming 3% Indonesian capacity 29% 32% Europe Mature and Open Market (No anti-dumping duties) PTL’s strong historical presence, superior product mix and customer intimacy to help sustain performance 36% 2018-19 Revenue Split EUROPE N. America Large Market with significant imports PTL’s on-shore presence being leveraged to distribute material from low cost group locations as well as specialty products
Indonesia Update ✴ Film Plant and Metallizer on schedule - slated to start Mid August ‘19 ✴ Chips Plant to start End Oct ‘19
Industry Outlook Line Capacity in Likely Start Up Location Line Size (meters) KT Date India 10.6 44 Q2 2019 SUPPLY Indonesia 10.6 44 Q3 2019 PTL Indonesia 8.7 30 Q4 2019 • Approx. 0.7 Million Tons Of Capacity To Be Added In Thin PET By 2022 Globally Hungary 10.6 44 Q1 2020 India 8.7 30 Q1 2020 • Approx. 0.2 Million Tons Of Capacity Expected In Thick PET By 2022 (China) Pakistan 8.7 30 Q1 2020 • Margin Disruption Expected Temporarily While Market Absorbs Added Supply Thailand 10.6 44 Q3 2020 • Most Industry Players = Cautious And Reasoned Growth Poland 10.6 44 Q2 2020 Nigeria 10.6 44 Q3 2020 Russia 8.7 30 Q4 2020 Russia 8.7 30 Q2 2021 85% 85% DEMAND 90% 8000 83% 83% 81% 81% India 10.6 44 Q3 2021 79% 79% 76% 76% 73% 73% 70% 70% China 8.7 120 (4 lines) Q4 2021 • Demand Expected To Grow At A Global 67.5% 6000 China 8.7 120 (4 lines) Q4 2022 Rate Of 5-7% China KMTPA 5.8 100 (4 lines) Q4 2021 • In Asia 7-9% China 45% 4000 5.8 100 (4 lines) Q4 2022 • Europe 3-4% TOTAL 898 • USA 4-5% 22.5% 2000 1.74 1.8 1.70 1.62 1.58 0% 0 1.62 1.51 2011 2016 2017 2018 2019 2020 2021 1.38 1.44 1.33 1.22 1.20 1.26 CUF Global Capacity Global Demand 1.14 1.13 1.09 1.06 1.06 1.02 1.01 1.08 0.97 0.95 0.85 0.85 BOPET Film CUF Trend (Thin + Thick) 0.9 0.64 0.72 0.56 0.54 0.50 0.49 0.54 0.38 0.36 RAW MATERIALS & VA TRENDS 0.29 0.36 0.28 0.25 0.18 • China’s Q3 2018-19 VA Was Due To Sudden Dip In RM Prices Which Normalized To The Trend In Q4 0 7 7 8 8 8 8 9 9 9 9 1 1 1 1 1 1 1 1 1 1 - - - - - - - - - - 6 6 7 7 7 7 8 8 8 8 • RM Volatility Passed Through To Customers With A Lag Of 2-3 Months 1 1 1 1 1 1 1 1 1 1 Y Y Y Y Y Y Y Y Y Y F F F F F F F F F F 3 4 1 2 3 4 1 2 3 4 • PTL Commands A Premium Over Chinese VA Q Q Q Q Q Q Q Q Q Q 12µ PET Resin China VA *Internal Analysis and Industry Sources
Plastics, Perception, Problem…? ~6 Million Tons Of Which Is PET Film 20% 80% 21% 79% Other Film PET Film constitutes less than 1.5% of the World Wide Flexible Packaging plastic use. Single Use Packaging Consumption Other Plastic Use Plastics under more 35% scrutiny 65% Other Packaging “Plastic isn't the problem. It’s what we do with it. And that means the onus is on us to be far smarter in how we use this miracle material” Erik Solheim Former head of the UN Environment ~400 Million Tons Of Plastic Consumed Worldwide *Industry Sources
PTL & Sustainability Our Target: Main Issue in Current Alternative with To Develop Alternatives with PET Films PET Films Olefinic Films Single High Post Multi Single Re-doubled our efforts in R&D with a Substrate Consumer Substrate Substrate renewed focus on sustainability . Structure Recyclate and Structure Structure High Performance high rPET High Performance Low Performance High Barriers High Barriers Low Barriers content in film High Speed High Speed Low Speed Better Recyclability Low Recyclability High Recyclability We Have Invested in Recycling & Our Product Range Now Includes: Sustainability Initiatives That: •Renewable PET Film – Bio source •PVC Replacement • Are Creating Sustainable Solutions For Flexible Packaging •Post Consumer Recyclable PET •PVDC Replacement • Are Working On Recycling Hard To Recycle Materials Film •Transfer Metallization • Develop And Promote rPET Films •Eco Friendly PET Film (Plastic free cartons) •Oxo Biodegradable •HP Indigo Printable • Are Working With Partners To Recycle Post Consumer Film •Biodegradable •Source Reduction Waste •Foil Replacement •Monomeric -Heat sealable
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