BCP 26.00 THB -0.25 (-0.95%)

Q3/2020

  • The Refinery and Oil Trading Business was still affected by the volatility of oil price and Gross Refinery Margin. This quarter recorded Operating GRM of 2.33 $/BBL which declined from the previous quarter. Mainly due to Gasoil and Dubai crack spread (GO/DB) adjusting downward continually, as Gasoil is the largest yield portion of the refinery. However, the Company has managed its production cost by way of procuring crude oil at a discounted market price from oil traders who stocked crude oil during the preceding periods of low price level. Moreover, as the refinery also adjusted its product yield to optimally satisfy market demand which increased the Gross Refinery Margin. Due to the recovering domestic oil product demand, average production rate was increased to 95.3 KBD or 79% utilization rate. In this quarter, the Refinery Business recorded an Inventory Gain of THB 269 million (including reversal on losses on inventories devaluation (NRV)). As a result, the performance improved QoQ. In regards to the Oil Trading business under BCPT Pte. Ltd., it recorded higher crude oil and finished product transaction volume. However, gross profit declined, primarily due to the gross profit of IMO

Refinery Crude Run

Unit : KBD

Q3/2020 $/BBL
Operating GRM 2.33
Oil Hedging 0.22
Inventory Gain / Loss* 0.97
Total GRM 3.52
* Including NRV

GRM Performance

Unit : $/BBL

Bangchak boasts a complex refinery with a capacity of 120,000 barrel per day based on sophisticated hydro cracking technology. The Company took assorted measures to raise its outputs and manage its refining margins.

Q3/2020

  • recorded improvements in performance. Sales through the retail channel rose by 14% QoQ and 3% YoY following the COVID-19 outbreak which began to subside, resulting in a higher demand oil consumption, combined with the Company’s strategy to continuously push sales volume. As for the industrial channel, it is still affected by the demand for Jet fuel which is still at low levels. Net marketing margin per unit declined slightly QoQ, but increased 15% YoY, from the higher proportion of sales volume through the retail channel which has higher marketing margin compared to the industrial channel. In this quarter, the Marketing Business Group recorded an Inventory Gain of THB 3 million. Nevertheless, the Company’s cumulative market shares of throughput per service station between the months of January - September 2020 was at 15.6%. Thus, the number of service stations as of the end of Q3/2020 was 1,223 locations.

Marketing Sales Volume

Unit : Million Litre

Total Marketing Margin

Unit : Baht/Litre

Market Share (Retail Channel)

Most of finished products from Bangchak’s refining processes were sold through the retail network of over 1,223 Service Station Nationwide Under brand “Bangchak”

BCPG Q3/2020 :

  • recorded superior performance from the investment expansion in various projects. Total electricity sales increased by 78% QoQ and 227% YoY, mainly from the electricity sales by the Hydropower Plant in Lao PDR which increased with significance. Due to the rainy season in Q3/2020, it was a high season for hydropower plant business. Moreover, BCPG Plc. has also acquired the Solar Power Plants in Thailand, “RPV” comprising of 4 projects (PPA of 20 MW), and has started to realize the performance from the 11th August 2020 onwards. The aforementioned projects will help compensate for performance affected by the rainy season. Moreover, under the resolution from the BCPG Plc. extraordinary shareholders’ meeting approving the plans to increase registered capital by issuing and offering new ordinary shares in the amount of 1.3 billion shares. This is expected to increase capital by THB 10.2 billion. The objective is to increase investments under the 5 year strategic plan. Furthermore, parts of the new capital raised will be used for principal payment, strengthening the company’s financial structure.

Total Electricity Sale

Unit : Million kWh

Diversified source of earnings to a stable visibility earnings businesses. In so doing, The establishment of BCPG Co., Ltd. (BCPG), to run and invest in power plants fueled by renewable energy.

Q3/2020
Biodiesel Business

  • Biodiesel Production and Distribution Business saw better gross profit by 53% QoQ and 146% YoY, due to the better raw material cost management, despite the softened sales revenue. B100 product sales volume increased by 7% QoQ, from higher demand, following Bangchak’s B10 product sales volume which expanded following the appointment of B10 product to be standard diesel fuel. However, B100 product sales volume declined 22% YoY, as the same period of last year the government promoted the use of B20 product, while in 2020, the use of B10 was more promoted.

Q3/2020
Ethanol Business

  • The Ethanol Production and Distribution Business, compared to the previous quarter, the sales volume of ethanol products for fuel was higher, corresponding to Bangchak’s sales volume of Gasohol product group which was higher after the launch of S EVO Family Gasohol. However, the higher priced industrial grade ethanol, which are used in the production of alcohol gels and other disinfectant products, saw a softening in demand due to the ease of COVID-19 outbreak situation, hence reducing the gross profit. For the YoY performance, the sales volume of Ethanol increased slightly. Whereas, gross profit declined from higher raw material cost when compared to the same period of the previous year, as in Q3/2019, KGI has adjusted the molasses raw material cost down by a greater amount than the current period in accordance with the announced average molasses domestic selling price. Furthermore, BBGI Plc. invested in company registration in the US which operates business relate to biotechnology, the category of Bio-ingredients.

Biodiesel Business: Production and Sales Volume

Unit : Million Litre

Ethanol Business: Production and Sales Volume

Unit : Million Litre

Bangchak promotes ethanol and biodiesel for blending in gasoline and diesel. Its products in this category include Gasohol 91, Gasohol 95, Gasohol E20, Gasohol E85, and Hi-diesel for national energy security by reducing trade deficits from oil imports.

Q3/2020 :

  • The Natural Resources Business Group saw performance declined by 196% QoQ, due to this quarter recording a realization of loss from the invested capital in the associate company, OKEA. Whereas the previous quarter that realized share of profit. Within this quarter, OKEA recorded higher revenue from the price of crude oil and natural gas that adjusted upward after the COVID-19 outbreak has been subsiding. However, the business realized lesser gains on foreign exchange compared to the previous quarter. Furthermore, increases in impairment of assets was recorded. Mainly, from the Yme asset under development, which saw delays in production start and an increase in capital expenditure, and the realization of deferred income tax, resulting in the net loss for this quarter to decline. As such, OKEA invested in the Calypso and Aurora fields (located near the Draugen and Gjøa field, respectively, which will serve to lower cost in the development and production from the combined synergy). The new fields are under exploration and are sites with potential that could lead to production in the future. As of the end of Q3/2020, the book value of invested capital in OKEA is valued at levels close to market value.

Average Production (Net to OKEA)

Unit : KBD

Bangchak holds 46.32% shareholding in OKEA AS, a norwegian Petroleum E&P company, as an associated company, and realize a profit sharing from OKEA.