rd Quarter 2018 3 rd Operating Results 4-Star Corporate Governance - PowerPoint PPT Presentation

rd Quarter 2018 3 rd Operating Results 4-Star Corporate Governance Rating Oppo rt unit y Day in 2018 13 December 2018 0

1 Q3/2018 Operating Results 2 Market Outlook 3 Investment & Delivery Plan 1

1 Q3/2018 Operating Results 2

Consolidated P/L Statement 1) Timely shifting of business emphasis Unit: MTHB Q2/2018 Q3/2017 Q3/2018 9M2017 9M2018 from FSU to domestic trading since the beginning of 2018 in response to the 1 Sales 1,106.3 1,132.0 1,195.8 3,421.3 3,320.5 recent market changes has resulted in 261.0 300.1 931.9 858.8 2 Gross Profit 317.9 a significant improvement in PRM performance 32.2 41.0 41.7 98.2 3 Share of P/L fr Assoc. 23.6 2) Acquisition of Big Sea Co., Ltd. since 5.5 54.9 16.7 76.9 4 Other incomes 15.7 July 2018 generated 17.2% of total net profit in Q3/2018 which is in line with 5 Net FX Gain/(Loss) (19.9) 30.4 1.0 86.8 5.5 expectation (82.2) (106.6) (246.5) (291.7) 6 SG&A (77.2) 3) Increase in share of profit from (60.4) (45.7) (172.2) (127.3) 7 Financial cost (36.5) associated companies came from international trading and FSU Business 8 Income Tax (18.9) (21.8) (15.1) (4.7) (39.44) 4) Other income in Q3/2018 Included gain 164.7 229.6 653.7 581.04 9 Net Profit 204.7 on sale of FSU vessel of 44.4 MTHB 10 EBITDA 380.2 413.4 419.0 1,319.1 1,123.9 5) FX gain was based on 9.3 MUSD loan outstanding at the end of Q3/2018 23.1% 25.1% 27.3% 25.9% 11 Gross Profit Margin(%) 28.7% 6) Increase in SG&A in Q3/2018 was due to payment of advisory fees relating 12 FX rate (Baht/USD) 31.9182 33.3866 32.9709 34.2684 32.1425 Big Sea acquisition and higher selling 13 No. of Vessels 24 25 37 25 37 expenses required to support incremental business volume 2,235.9 1,991.7 2,235.9 1,991.7 14 Capacity (‘000 DWT) 2,524.8 3

Domestic Oil and Petrochemical Tanker (“Domestic Trading”) Business 1) Acquisition of Big Sea on 1 July 2018 added 13 vessels to PRM’s R e v e n u e U n i t : M T H B domestic tanker fleet and generated 169.0 MTHB of revenue and 33.5% 49.0 MTHB of gross profit in Q3/2018 1,366.5 2) Replacing 2,499 DWT tanker by a new 3,000 DWT tanker since Q1/2018 supported incremental business volume 1,023.2 55.9% 3) Market demand for back haul shipment from Phuket route remained strong 578.6 423.9 371.1 4) PRM’s market share for the sector increased from 25% in last quarter to 49.3% at end of Q3/2018 Q2/2018 Q3/2017 Q3/2018 9M/2017 9M/2018 5) Majority of our customers are major oil companies 13/48 13/45 27/84 Vessels/ ‘000 DWT V o l u m e T r a d i n g b y C h a r t e r e r s U n i t : M L 92.5% 82.9% 85.4% Utilization Rate 2,171.0 (Included Big Sea) G r o s s P r o f i t U n i t : M T H B 83.7% 270.1 251.5 OTHERS 80.2% 122.4 CHEVRON 320.9 77.6 IRPC 1,181.9 1,154.9 519.8 ESSO 120.9% 96.2 187.3 55.3 SHELL 178.1 74.6 68.4 29.4 148.1 113.2 112.0 67.0 PTT 113.8 114.2 146.4 27.0% 18.1% 25.6% 17.4% 23.5% 929.6 701.7 638.3 Q2/2018 Q3/2017 Q3/2018 9M/2017 9M/2018 4 Q1/2018 Q2/2018 Q3/2018

International Oil and Petrochemical Tanker ( “ International Trading ” ) Business 1) Higher revenue and fuel cost saving from time chartering resulted in R e v e n u e U n i t : M T H B significant improvement in international trading business -10.8% 2) Revenue increased 20% or 83.1 MTHB as the two Aframax vessels were 261.7 operated on time chartering basis in 2018 versus spot chartering in 233.3 Q3/2018 20.0% 3) Significant fuel cost saving was also achieved in Q3/2018 under time chartering contract 83.1 81.2 69.2 4) Spot freight market is gradually moving up during the quarter following tight supply of vessels and is expected to push chartering rate shortly which will further improve international trading performance. Q2/2018 Q3/2017 Q3/2018 9M/2017 9M/2018 G l o b a l F r e i g h t U n i t : $ U S D / D a y 2/211 Vessels/ ‘000 DWT 2/211 2/211 SPOT Market Time Charter Market 93.4% 81.0% 95.2% Utilization Rate G r o s s P r o f i t U n i t : M T H B Aframax (Indo-Jap) Rate improved with WS 135 Q2/2018 Q3/2017 Q3/2018 9M/2017 9M/2018 (5.7) due to short supply from vessel -15.0% -91.0% scrapping -10.4% -35.4% -7.8% (12.2) (6.4) (24.3) (63.0) 89.8% 73.7% (92.6) Fearnley projected TC rate for Aframax to be increased to $22,500USD/Day in 2019, compared to $10,900USD/Day in 2018 5 Source : Clarksons Research as of 26 Oct 2018 and Fearnley Research

Floating Storage Unit (“FSU”) Business 1) Bongkot FSU is operated under JV with Bangchak. The JV R e v e n u e U n i t : M T H B performance was reported in P/L as income from assoc. but is Bongkot Marine Service included in FSU business for analysis purpose -18.5% 1,596.2 2) Oil future market remained in backwardation 76.6 1,301.5 3) FSU chartering rate was pressured by increased vessel supply and 1,519.6 -31.4% 219.8 caused a negative one-time retroactive adjustment in revenue of 549.6 29.2 MTHB 456.7 1,081.7 74.1 377.0 73.3 4) One FSU vessel was scrapped in Q3/2018 with a gain on sale of 44.4 475.5 74.1 383.5 MTHB 302.9 5) The remaining 5 FSU vessels (included Bongkot FSU) achieved over 90% capacity utilization throughout Q3/2018 Q2/2018 Q3/2017 Q3/2018 9M/2017 9M/2018 6/1,785 7/2,076 5/1,504 Vessels/ ‘000 DWT ▪ Crude oil situation has a trend to be contango market 88.8% 87.0% 93.8% Utilization Rate G r o s s P r o f i t U n i t : M T H B 726.6 -37.7% 20.6 706.0 452.7 -51.7% 225.3 176.9 85.0 19.9 205.4 29.4 367.7 108.9 147.5 26.8 62.81$ 82.1 34.8% 21Nov2018 45.5% 38.7% 50.0% 28.9% 9M/2017 9M/2018 Q2/2018 Q3/2017 Q3/2018 6 Source: https://www.spglobal.com/platts/en/market-insights/latest-news/oil/110818-crude-oil-futures-contango-grows-as- market-eyes-supply-glut-nymex-wti-down-to-6119-b-ice-brent-7163-b

Floating Storage and Offshore Exploration Service (“Offshore”) Business 1) 2 Floating Storage and Off-Loading ( “ FSO ” ) vessels were R e v e n u e U n i t : M T H B on-hired under term contracts throughout Q3/2018. -4.0% 385.2 2) “ Navathani ” the accommodation work barge (AWB) was 369.8 on-hired by PTTEP throughout Q3/2018 where as in Q3/2017 31.1% compared with in Q3/2017 only one month 141.5 135.3 107.9 3) Baht depreciation during the quarter is also favorable to offshore business whose revenue is dominated in USD Q2/2018 Q3/2017 Q3/2018 9M/2017 9M/2018 4) Navathani will complete its existing contract with PTTEP in 2/192 2/192 2/192 FSO/ ‘000 DWT October. PRM is in process of discussion with PTTEP for long- 100.0% 100.0% 100.0% FSO Utilization Rate term contract 1/300 1/300 1/300 AWB/Capacity (PAX) 100.0% 29.0% 100.0% AWB Utilization Rate G r o s s P r o f i t U n i t : M T H B 39.3% 98.1 70.4 237.6% 44.1 41.2 13.1 30.5% 12.1% 31.2% 18.3% 75.4% Q2/2018 Q3/2017 Q3/2018 9M/2017 9M/2018 7

Ship Management (“SM”) Business 1) PRM provides ship management services for 27 vessels of R e v e n u e U n i t : M T H B which 5 are third party vessels: 14.5% 2 VLCC vessels o 269.1 1 Aframax vessel o 235.0 -17.1% 2 containers o 108.3 2) SM service fee increased by ≈ 3% during the quarter in line 89.7 82.4 with service agreement Q2/2018 Q3/2017 Q3/2018 9M/2017 9M/2018 3) Ship management fee is denominated in USD hence, weak No. of 3 rd Party Vessels baht is more favorable to business 5 6 5 4) Lower revenue and GP in Q3/2018 as compared to Q3/2017 was due to scrapping of one 3 rd party vessel under G r o s s P r o f i t U n i t : M T H B ship management contract 34.8% 96.4 71.5 -16.2% 38.5 32.3 27.1 32.9% 35.6% 36.0% 30.4% 35.8% Q2/2018 Q3/2017 Q3/2018 9M/2017 9M/2018 8

Consolidated Financial Position As of As of 30 Sep 2018 31 Dec 2017 1) 2,000 MTHB reduction to 972.9 MTHB in 972.9 cash and cash equivalent was due 1,684.8 1,470.2 623.4 mainly to 1,400 MTHB payment for the 79.2 2,974.3 41.8 first 70% of Big Sea’s shares and 417 2,424.8 2,920.0 MTHB payment for 2 new vessels 498.2 2) 2,200 MTHB increase in non-current assets to 9,405.1 MTHB came from 9,405.1 acquisition of Big Sea Co., Ltd. and 7,206.2 6,812.6 investment in new vessels 6,246.7 3) Higher current assets mainly came from Accounts Receivable (AR) which increased from higher business 10,678.7 10,678.7 11,001.3 11,001.3 volume Current Ratio 2.36:1 0.95:1 4) LT Loan reduced by 495.2 MTHB to D/E Ratio 0.71:1 0.61:1 2,424.8 MTHB from loan repayment during the quarter. Current Liabilities Cash & Cash Equivalents Other Non Current Liabilities Other Current Assets L/T Loan Non Current Assets Shareholders’ Equity 9

2 Market Outlook 10