SET Announcements

- TRANSLATION - 1000 / 253 / 2006 November 15, 2006 Subject : Filing Reviewed Financial Statements and Business Operations' Explanation for 3rd Quarter, 2006 Attention : President of The Stock Exchange of Thailand Attachment : 1. Reviewed Financial Statements for 3rd Quarter, 2006 (Thai 1 Copy) 2. Reviewed Financial Statements for 3rd Quarter, 2006 (English 1 Copy) According to the SET's Regulation Re: Preparation and Submission of Financial Statements, Financial Reports and Operating Results of Listed Companies, 2001, a listed company shall prepare and submit quarterly financial statements reviewed by the Auditor within 45 days since the last day of each quarter. The Bangchak Petroleum Public Company Limited (BCP) would like to file reviewed financial statements by the Auditor for 3rd Quarter ending September 30, 2006. Please be further informed that at this period, the Company has changed accounting policy regarding inventory cost valuation method from First In First Out (FIFO) to Weighted Average, being effective from July 1, 2006 onward, therefore this 3rd Quarter financial statements was prepared and compared with the restated, adjustment from FIFO to weighted Average, financial statements of last year as follow: During this 3rd quarter, 2006, the Company's total revenues were Baht 23,742 million, EBITDA was Baht 243 million, net interest expense was Baht 141 million, Depreciation and Amortization were Baht 199 million, and the corporate income tax credit was Baht 144 million. As a result, profits after tax at this quarter posted a net loss of Baht 2 million, comparing with Baht 1,100 million net profit of 3rd Quarter, last year. Major differences came from inventory effects which recorded an inventory gain of Baht 877 million in 2005 while this year it was loss of Baht 582 million. Inventory effects at this quarter are consist of inventory loss of Baht 232 million and allowance for write down of inventories value at Baht 350 million. Details of which are as follow: 1. Gross Refining Margin (GRM) (not including inventory effects) was 3.23 USD/BBL, lower than that of the same period of last year which was at 5.36 USD/BBL. This effects were resulted from rapidly decreased in oil price due to fundamental factors changed i.e. a relief pressure concerning conflict in the Middle East, no serious damage to US and Mexico production units during a Tornado season and demand decreased after driving season. In addition, there were effects from investment adjustment of those investors in the future market. However, the Company has maintained crude run level to be at level of 60 KBD compare to 58 KBD at the same period last year. 2. Marketing Margin (not including lubricant) was 68.40 satang per liter (retail margin was 75.42 satang per liter and industrial margin was at 54.85 satang per liter) higher than that of the same period of last year which was at the level -17.50 satang per liter. These gains were resulted from retail oil prices which were adjusted slower than their cost during down trend market situation. 3. At this quarter, the Company set the allowance for write down of inventory value at Baht 350 million due to average cost of inventories was higher than the net realizable value at the end of the period by 3-4%. From this effect, EBITDA of the company was recorded as follow, Table: Details of breakdown EBITDA (unit : Million Baht) 3rd Quarter, 06 3rd Quarter, 05 Changing +/- (A) (B) (A) - (B) (Reviewed) (Revised) * EBITDA +243 +1,659 -1,416 - Refinery -89 +1,949 -2,038 - Marketing +332 -290 +622 * (Less) Inventory Gain - (877) +877 Plus Inventory Loss & Write Down 582 - +582 * Adjusted EBITDA +825 +782 +43 - Refinery +493 +1,072 -579 - Marketing +332 -290 +622 Please be further noted that without having effects from inventories, the adjusted EBITDA of the Company at this period was Baht 825 million, Baht 43 million higher than those of last year. 4. Net interest expense was Baht 141 million, decreased from that of the same period of last year by Baht 15 million. Please be noted that the interest income also increased by Baht 64 million from Baht 4,726 million financial investments and also the interest expense increased by Baht 49 million since the loan interest rate increased by approximately 1.5%. 5. The Company had credited back income tax for this period of Baht 144 million. This tax credits were resulted from 1) performance loss of this quarter at a credit amount of Baht 41 million and 2) Baht 103 million, tax benefit for capital investment program (mainly PQI project) in accordance with the Notification of the Director-General of Revenue Department on Income Tax (No. 156) effective date the 1st of January 2006. 6. Financial position and ratios; Sep 30, 2006 Dec 31, 2005 Changing +/- (Million Baht) (Reviewed) (Revised) (A) - (B) * Total Assets 40,052 34,199 + 5,853 * Total Liabilities 20,638 21,306 - 668 * Shareholders' Equity 19,414 12,893 + 6,521 * Debt to Equity Ratio (time) 1/ 0.71 1.05 * Book Value per Share (Baht) 2/ 17.35 18.75 Remark 1/ Only Interest Bearing Debt 2/ Number of shares as of Sep 30, 2006 and Dec 31, 2005 were 1,119 million shares and 687 million shares, respectively 7. Changed of accounting policy regarding inventory cost valuation method from First In First Out (FIFO) to Weighted Average required the Company to adjust financial statements for the year 2005 as follow, 7.1) Profit and loss for the three month period; 2006 2005 (Million Baht) WA FIFO +/- WA FIFO +/- * Profit (loss) before tax (146) (277) +131 1,335 1,552 -217 * Income tax 144 183 -39 (235) (302) +67 * Net profit (loss) (2) (94) +92 1,100 1,250 -150 7.2) Profit and loss for the nine month period; 2006 2005 (Million Baht) WA FIFO +/- WA FIFO +/- * Profit (loss) before tax 1,134 1,069 +65 2,625 3,299 -674 * Income tax (227) (208) -19 (92) (294) +202 * Net profit (loss) 907 861 +46 2,533 3,005 -472 In addition to an adjustment of profit and loss statement for the three month period and the nine month period to reflect difference between FIFO method and Weighted Average method, the Company also made adjustment to balance sheets for the year ended December 31, 2005, as a result from this adjustment, retained earning was increased by Baht 23 million. Please be informed accordingly. Yours sincerely, - Signed - (Anusorn Sangnimnuan) President Corporate Planning and Investor Relation Office Tel : 0-2335-4583