Dr. Kongkrapan Intarajang, Chief Executive Officer of PTT Global Chemical Public Company Limited, or GC, PTT Group’s petrochemical flagship based in Thailand said that GC is delivering on key strategies and adjusting its operations in response to the COVID-19 pandemic, fluctuating oil prices, and the trade war which have together impacted the company’s growth. The company also announced its interim financial results for the Q2/2020, with total sales revenue at 69,271 million baht, a decrease of 26% from Q1/2020 and a decrease of 35% from Q2/2019. GC’s operating profit (excluding stock loss net reversal of NRV, foreign exchange gain and loss from commodity hedging) stood at 1,409 million baht in Q2/2020, a 1,128 million baht or 25% increase from the previous quarter. The company had adjusted EBITDA of 6,463 million baht in Q2/2020, an increase of 2% from Q1/2020, but a 15% decrease from Q2/2019. Furthermore, GC announced an 899 million baht stock loss net reversal (NRV), a 340 million baht loss from commodity hedging, and a 1,501 million baht foreign exchange gain from the appreciation of the Thai baht during the period. GC recorded net profit of 1,671 million baht (0.37 baht/share), an increase of 119% from Q1/2020.
- The refinery had a capacity utilization rate of 102%.
- Olefins had a capacity utilization rate of 100%.
- Aromatics had a capacity utilization rate of 99%.
- GC issued corporate debentures worth around 15,000 million baht last April.
- GC’s shareholders approved a USD 4 billion debenture issuance (2020-2024) for loan payments, investments, and the company’s general business operations.
In addition, GC is continuing to implement three strategic steps into its business operations together with a careful review and strategic adjustments during this critical period. The strategic steps are:
1. Step Change: Strengthening the Company and increasing competitiveness through operational excellence, increasing feedstock flexibility, and the development of the High Value Product (HVP) business. GC recently acquired shares of Dynachisso Thai Co. Ltd. to advance its engineering plastics of PP Compound business.
2. Step Out: Growing Externally through GC’s M&A strategy for new businesses to support High Value Businesses such as High Performance Polymers & Composites and Coating & Adhesives by turning the COVID-19 crisis into an opportunity to negotiate purchases and securing more desirable prices.
3. Step Up: Growing Sustainably as GC will elevate sustainability in its business by implementing a climate strategy and clear targets to reduce gas emissions as follows: 1) A reduction in greenhouse gas emissions (Scope 1 and 2) by 20% by 2030, and 2) A reduction in greenhouse gas emissions intensity (Scope 1 and 2) by 52% by 2050. These two targets are in line with Thailand’s climate goals and support global efforts at keeping temperature rise to well below 2?C. At present, GC is focusing on Scope 3 in extending operating results and reducing greenhouse gas emissions through the supply chain, for instance, reducing traffic by promoting a work-from-home policy among employees.
GC is also integrating the principles of the Circular Economy into its business through the following three mechanisms:
1. Smart Operating: Sustainably Improving Management and Operations. GC is exploring new ways of doing business by using technology to develop and improve manufacturing processes that reduce the use of natural resources and maximize circular usage.
2. Responsible Caring: Developing Eco-friendly Products that promote sustainability and reduce the use of resources ensuring that products are long-lasting. Furthermore, GC is continuing to develop products that are cost-efficient, and which incorporate ecological designs to be a model company in sustainable Product Stewardship. The company has set a firm target to increase the proportion of Performance Products and Green Chemicals from 10% to 30% by 2030.
3. Loop Connecting: Linking All Sectors within the Supply Chain. GC is partnering with all associates in the value chain to continue implementing socially responsible projects that use resources efficiently and reduce the amount of waste by transforming them into value-added products, demonstrating an effective way to build integrated business connections in line with the principles of the Circular Economy. The projects include the 'Send Plastic Home’ pilot project in which GC is collaborating with the Ministry of Natural Resources and Environment, the Thailand Responsible Business Network (TRBN), and other partners to collect waste. The project chose Sukhumvit Road as Thailand’s first “Circular Hotspot” to demonstrate how the public can participate and effectively support a circular economy. A second initiative GC supported is the 'Ten Clean Canals’ project, which produced prototype “litter traps” that catch waste in public canals. The operation will begin at 'Khlong Kut Chao Muang’ in the municipality of Muang Lad Luang before expanding to other canals.
In addition, the 'Upcycling the Oceans, Thailand’ project has been ongoing for three years, in partnership with the Tourism Authority of Thailand (TAT) and the ECOALF Foundation to collect plastic waste in Thailand’s marine tourist areas and oceans, and maximizing its use by transforming it into value-added and fashionable clothing through the upcycling process. This is also Thailand and ASEAN’s first project conducted in accordance with the new BS8001:2017 international standard, a framework to implement the principles of the circular economy in organizations, marking an important inaugural achievement and a cornerstone for other projects in the future.
This year, GC underscored its leadership in sustainability in its business operations by passing the assessment criteria of FTSE, a globally recognized Sustainability Index, while remaining a constituent member of the FTSE4Good Index Series coming in third place in 2020, in addition to being named to FTSE Russell for the fifth consecutive year. These achievements reinforce the company’s responsible approach which support the environment and society, and focus on sustainability and good governance for Environmental, Social and Governance (ESG) performance.