analyst conference q4/15 - listed companyscc.listedcompany.com/misc/presn/20160127-scc... ·...

Analyst Conference Q4/15Wednesday, January 27, 2016

2

AGENDA

I. Consolidated Results- Q4/15 Consolidated Results- FY2015 Summary- Financial Updates

II. SCG Cement - Building MaterialsIII. SCG ChemicalsIV. SCG PackagingV. Summary

3

121,765 124,795 124,275116,710

109,276 113,818 110,898105,622

0

30,000

60,000

90,000

120,000

150,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

MB

Revenue from SalesQ4/15 revenue decreased -10% y-o-y and -5% q-o-q, attributed to lower chemicals revenue which is linked to the drop in oil prices.

- 10% y-o-y

- 5% q-o-q

4

15,071 15,82614,203

16,04818,131

23,281

18,982 18,952

3931,189

1,8761,887

284

1,983

98 979

0

3,000

6,000

9,000

12,000

15,000

18,000

21,000

24,000

27,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

MB

15,46417,015

16,07917,935 18,415

25,264

NOTE: EBITDA = EBITDA from Operations + Dividend from Associates

EBITDAHealthy chemicals spreads were the main drivers towards the EBITDA growth of 11% y-o-y and 4% q-o-q.

Dividend from Associates

EBITDA

EBITDA from Operations

+11% y-o-y

+4% q-o-q

+18% y-o-y

Flat q-o-q

19,93119,080

5

Equity IncomeContributions from chemicals associates drove the 37% y-o-y gain, but was sideways q-o-q.

1,047 672 533

1,061 752 747 717 878

678

445 1,107

565 1,495

2,900

1,456 1,348

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

Chemicals

Non-ChemicalsMB

1,725

1,117

1,640 1,626

2,247

+37% y-o-y

+2% q-o-q

3,647

2,173 2,226

6

Profit for the PeriodProfitability was a healthy 11,449 MB, as a result of the solid chemicals earnings which accounted for 66% of SCG’s total Q4/15 profitability.

Key Non- recurring 460 (30) 700 (2,710) 1,020 700 (3,630) 1,3201) FX Gain (Loss)

(170) 0 680 130 460 (270)(420)

(1,050)510

2) Inventory Gain (Loss)* 180 (80) (130) (2,960) (930) 970 (2,160) 330

3) Insurance Claim (Sub + Asso.) 450 50 150 120 0 0 0 0

4) Others 0 0 0 0 1,490 0 0 480

*Note: SCG Chemicals (Sub + Asso.)

+29% y-o-y

+27% q-o-q

-3,000

0

3,000

6,000

9,000

12,000

15,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

MB

8,381 8,532 7,8468,856

11,073

13,877

9,001

11,449

7

AGENDA



8

Segmented Revenue from SalesThe chemicals business accounted for 46% of Revenue in FY2015.

FY2015439,614 MB (-10% y-o-y)

Cement-Building Materials

38%

Packaging16%

Chemicals46%

FY2014487,545 MB


36%

Packaging13%

Chemicals51%

185,423

248,118

64,614

178,988200,433

70,907

0

50,000

100,000

150,000

200,000

250,000

MB

FY2014 FY2015 FY2014 FY2015 FY2014 FY2015Cement -

Building MaterialsChemicals Packaging

9

Segmented Profit for the PeriodThe growth was from the chemicals business which accounted for 62% of the FY2015 earnings.

(Mainly SCG Investment and Corporate )

13,180 12,461

3,448 4,829

10,250

28,488

3,463 3,457

0

5,000

10,000

15,000

20,000

25,000

30,000MB

FY2014 FY2015 FY2014 FY2015 FY2014 FY2015 FY2014 FY2015Cement - Building

MaterialsChemicals Packaging Others

Sub.21,289

Sub.9,666

FY201433,615 MB

FY201545,400 MB (+35% y-o-y)

Other15%

ChemicalsEquity Income

8%

Chemicals Subsidiaries

28%Cement-Building Materials

39%

Packaging10%

Other8%

ChemicalsEquity Income

16%

Chemicals Subsidiaries

46%


23%

Packaging7%

Eq Inc.

Eq Inc.

10

FY2015 Revenue from Sales & EBITDASales decreased -10% y-o-y on lower chemicals prices, while EBITDA and profitability gained as a result of the surge in chemicals performance.

0

100,000

200,000

300,000

400,000

500,000

FY2014 FY2015

MB487,545

439,614

Revenue from Sales

0

20,000

40,000

60,000

80,000

100,000

FY2014 FY2015

Dividend


MB

EBITDA

66,493

82,690

EBITDA 13% 18%Margin:

EBITDA

61,148

3,344

5,345

79,342

0

10,000

20,000

30,000

40,000

50,000

FY2014 FY2015

MB

EPS: 28 % 38%

Profit for the Period

45,400

33,615

11

61% 60%

9% 11%

12% 12%

18% 17%

0%

20%

40%

60%

80%

100%

FY2014 FY2015

ASEAN40%

ASEAN43%

China/HK, 24%

China/HK, 24%

S. Asia, 7%S. Asia, 8%

N. Asia, 9% N. Asia, 6%

Others, 20% Others, 19%

0%

20%

40%

60%

80%

100%

FY2014 FY2015

Segments: Export Sales and ASEAN OperationASEAN exports and ASEAN operations accounted for 23% in FY2015, compared to 21% in FY2014.

% of Sales 30% 29%

Sales Destinations

23%

Domestic

ASEAN Operation

Export to ASEAN

Export to Others

Export Destinations

21%

143,261 MB 126,996 MB439,614 MB 487,545 MB

12

0

20,000

40,000

60,000

80,000

100,000

120,000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Export to ASEAN

ASEAN Operation

Percentage of total sales from ASEAN Operations:

3% 5% 5% 7% 7% 7% 8% 9% 9% 11%

ASEAN Sales

Segments: Export Sale and ASEAN OperationSales to ASEAN (exports and localized operations) reached 100,510 MB in FY2015 (Thai Baht term).

MB

30,93637,496

43,923 40,56651,750

61,213

74,46585,537

100,912 100,150

Vietnam31%

Indonesia26%

Cambodia11%

Myanmar10%

Philippines9%

Malaysia5%

Singapore5%

Laos3%

ASEAN Sales by countries

Export to ASEAN by countries

ASEAN Operation by countries

Vietnam46%

Indonesia29%

Philippines11%

Cambodia11%

Myanmar1%

Singapore1% Laos

1%

Indonesia24%

Myanmar17%

Vietnam17%

Cambodia12%

Malaysia9%

Singapore9%

Philippines7%

Laos5%

(Flat y-o-y)

+6% y-o-y

-6% y-o-y

13

HVA’s Revenue from Sales

Consolidated:

Business 2013 2014 2015

Cement- Building Materials 41% 42% 41%

Chemicals 27% 27% 31%

Chemicals (Includes associates) 50% 50% 53%

Packaging 38% 39% 39%

0

50,000

100,000

150,000

200,000

2004 2007 2008 2009 2010 2011 2012 2013 2014 2015

HVA as a % of 4% 17% 19% 25% 29% 32% 34% 35% 35% 37%Revenue from Sales

MB

$200m

149,924136,762

117,992

85,768

59,46154,86538,837

7,783

169,071 161,851

$4.7 billion

(-4% y-o-y)

14

42%

43%

11%

4%Cement-Building Materials

Packaging

Chemicals

Others

R&D and Product DesignTeam

R&D and Product Design Team

R&D Spending

SBU:

364 (Ph.D. = 9) 1,646 (Ph.D. = 114)2007 Jan/16

% R&D SPENDING ON SALES: 0.3% 0.4% 0.5% 0.6% 0.8%

40370

720 880 921 1,1111,430

2,0682,710

3,510

0

1,000

2,000

3,000

4,000

2004 2007 2008 2009 2010 2011 2012 2013 2014 2015

MB

$1m

$102m

15

AGENDA



16

EBITDA on Assets and EBITDA Margin

Percent (%)

EBITDA on Assets = EBITDA / Consolidated Assets EBITDA margin = EBITDA from Operations / Co nsolidated Sales

EBITDA Margin (%):

23 27 23 22 22 23 26 22 19 16 14 18 14 11 10 13 13 18

EBITDA on Total Assets

1416 16 17

1821

2927 26

20

14 1513 12 12

14 1416

0

5

10

15

20

25

30

35

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

17

Net DebtLeverage registered 2.0 times (x), on healthy EBITDA and lower net debt.

243.5

197.1

178.0 175.7

148.4

126.3114.9

100.6 100.5 103.0 99.9

120.5 122.0

83.6

112.1

137.6

157.8164.4 162.5

9.2

7.7

6.4

5.8

5.1

4.1

3.1

1.8 1.9 1.8 2.0

3.12.6

1.8

2.4

3.02.6 2.5

2.0

0

1

2

3

4

5

6

7

8

9

10

0

50

100

150

200

250

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Billion Baht(Net Debt)

Times (x)(Leverage)

Net Debt to Equity = 0.7x

Net Debt on EBITDA

18

0

10

20

30

40

50

60

70

80

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Billion Baht

10.0

3.5

10.3 8.55.7

11.914.0

19.123.6

27.2

42.4

34.5

18.4

32.0

47.050.0

45.0 45.2

CAPEX & InvestmentsAmounted to 45,184 MB in FY2015, which was mainly from the greenfield expansion in the cement-building materials business.

- CAPEX includes debottlenecking, expansion projects, and major turnaround.- Investments are acquisitions and purchase of shares .

Efficiency projects

19%

Others3%

Greenfield & Expansion

62%Maintenance

11%

FY2015SBU: Types :

60%26%

11%

4%Others

Cement-Building MaterialsPackaging

Chemicals

Investment5%

19

Interest and Finance CostsThe FY2015 total of 9,076 MB included a cumulative FX loss of 770 MB, while interest cost was 3.9% at the end of Dec/15.

NOTE: Interest & financial charges include FX gain/ loss transactions.

FX gain (loss): 660 940 (690) 640 (770)

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

MB

15,006

12,995

14,030

11,487

10,038

8,101

5,878

4,762 5,169 5,2736,089

5,6494,670

6,048 6,321

8,1937,266

9,076

20

1.7 2.3 2.2 2.5 3.0

4.6

9.3

11.2 11.1

9.5

6.38.1

7.2 6.9 6.37.6

8.89.9

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Interest Coverage Ratio

Times (x)

Note: - Interest Coverage Ratio = EBITDA / Interest Expense

- Interest Coverage Ratio excludes the effect of FX gain/loss.

21

Financial Highlights & Outlook

Highlights:

� FY2015 dividend of 16.0 Bt/share (42% payout) or 19,200 MB. This is comprised of the H1/15 interim of 7.5 Bt, and the H2/15 year-end of 8.5 Bt.

� Net Working Capital increased 13% q-o-q to 60,998 MB, with Inventory to Net Sales of 45 days from 43 days in Q3/15.

� Cash & cash under management of 40,279 MB at the end of Q4/15.

� Issued 10 Billion Baht (4 years, 3.40% fixed) debenture on Nov 2/15 to replace the matured 10 Billion Baht tranche (4-years, 4.50% fixed).

Outlook:

� Continued strong cash flow generation from operations is expected.

� Forecasted FY2016 CAPEX & Investments of approximately 50,000 MB.

� Estimated FY2016 depreciation of 24,000 MB, up 3,000 MB y-o-y.

� FY2016 maturing debenture of 50 Billion Baht (Apr 1/16 = 25 Billion Baht @ 4.15%, and Nov 1/16 = 25 Billion Baht @ 4.15%). The Apr 1/16 maturity will be refinance with a 25 Billion Baht issuance (25 Billion Baht with a 4 year tenure).

22

AGENDA



23

69% 65% 67% 64% 65% 63% 65% 62%

31% 35% 33% 36% 35% 37% 35% 38%

0

50,000

100,000

150,000

200,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

Revenue from Sales Sales in Q4/15 decreased -5% y-o-y due to the domestic market softness.

-5% y-o-y

-2% q-o-qInternationalDomestic

MB

47,512 46,378 46,382 45,151 47,081 45,663 43,570 42,674 66% 64%

34%36%

2014 2015

185,423178,988

FY2015 Sales-3% y-o-y

24

EBITDA Margin *Total 16% 15% 14% 13% 15% 14% 13% 12% 14% 14%

International 9% 9% 9% 10% 10% 11% 10% 8% 10% 10%Domestic 18% 16% 16% 15% 18% 16% 14% 15% 17% 16%Domestic Structural Pro 28% 26% 25% 21% 27% 24% 22% 21% 25% 23%

EBITDA PortionInternational 19% 25% 23% 28% 24% 29% 28% 24% 24% 26%

EBITDA and Profit for the PeriodQ4/15 EBITDA dropped -13% y-o-y on the weak domestic market.FY2015 Profit declined -22% y-o-y due to increased depreciation expense.

* EBITDA margin = EBITDA from Operations / Consolidat ed Sales

7,605 6,747

6,388 5,943

7,170 6,435

5,590 5,200

4,114 3,445

3,072 2,549

3,558 2,896

2,073 1,723

0

2,000

4,000

6,000

8,000

10,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

MB

EBITDA

Profit for the period-32% y-o-y

-17% q-o-q

-13% y-o-y

-7% q-o-q

2014 2015

2014 2015

EBITDA (MB)-9% y-o-y

Profit (MB)-22% y-o-y

26,683 24,395

13,18010,250

25

Q4/15 Domestic market insight

� Cement demand grew +2% y-o-y in Q4/15, attributed mainly to the demand growth from the infrastructure projects, and resulting in the flat y-o-y growth for FY2015.

� Ready-mixed concrete (RMC) demand grew +3% y-o-y in Q4/15, with flat growth for FY2015. The average prices in Q4/15 dropped y-o-y to the range of 1,750-1,800 baht per cubic meter.

� Demand for housing products (roof ceiling & wall) in Q4/15 dropped -2% y-o-y, while demand for ceramic tiles dropped -4% y-o-y, resulting in the FY2015 declines of -1% and –4% respectively,

26

Domestic sales segmentationQ4/15 sales in Thailand droped -8% y-o-y, primary due to the softer domestic market.

Note : Domestic business: domestic sales from Thai operat ions Structural Products: Grey cement, RMC, Others (mortar, white cement, and lightweight concrete blocks).Housing Products: Roofing products, Board & Wood sub, and Home improv ement.Ceramics: includes Sanitary ware and Fittings.

Grey Cement,

21%

RMC 24%

Others, 5%

Housing Products,

16%

Ceramics14%

Logistic and

Others, 20%

113,978 MB(-7% y-o-y)

Domestic Sales (FY2015)

23% 23% 20% 21% 22% 21% 20% 21%

22%22% 23% 24% 22% 22% 25% 25%

5%5% 5% 5% 5%

5% 5% 5%

16%16% 15%

14%17%

17% 16% 15%

14%

14% 15% 13%

14% 14% 14%

14%

20%

20% 22%23%

20%21% 20%

20%

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

Structural Products

MB

-8% y-o-y

-6% q-o-q

32,91929,959 31,066

28,79630,530

28,840 28,18326,425

27

Domestic cement segments

% Growth ( y-o-y )

Q1/14 Q2/14 Q3/14 Q4/14 2014 Q1/15 Q2/15 Q3/15 Q4/15 2015

Total Market*(100%)

+4% +0% -3% -3% -1% -2% +2% -1% +2% 0%

Commercial(Approximately 20%)

+14% +5% -4% -8% +1% -6% +1% -3% 0% -2%

Gov’t(Approximately 30%)

+1% -2% -3% +0% -1% +10% +11% +11% +12% +11%

Residential(Approximately 50%)

+1% -1% -2% -3% -1% -7% -3% -7% -4% -5%

Note: * Estimated volume market distribution

28

Sale Mix

- Bagged Cement (%) 49 44 42 42 45 44 40 38 41 40 37 37 39 39 35 35

- Bulk Cement (%) 51 56 58 58 55 56 60 62 59 60 63 63 61 61 65 65

Domestic cement priceAverage prices in Q4/15 dropped q-o-q to the range of 1,800-1,850 Bt/ton.

0

500

1,000

1,500

2,000

2,500

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Baht/Ton Average Domestic Price of Grey Cement (Net ex-facto ry)

2010 2011 2012 2013 2014 2015

29

ASEAN market insight

Q1/14 Q2/14 Q3/14 Q4/14 2014 Q1/15 Q2/15 Q3/15 Q4/15 2015

Cambodia +11% +3% +6% +21% +10% +8% +12% +17% +0% +9%

Indonesia +4% +4% +2% +3% +3% -2% -4% +3% +6% +1%

Myanmar +19% +14% +5% +5% +11% +17% +19% +7% +2% +11%

Vietnam +11% +6% +17% +9% +11% -1% +11% +6% +14%* +8%*

Cement Demand Growth ( y-o-y )

Note: Indonesia’s cement demand is based on data fr om the Indonesian cement association (ASI).* Vietnam’s cement demand in Q4/15 included only O ct- Nov.

Vietnam’s cement demand in 2015 included only the f irst eleven months.

30

Myanmar39%

Cambodia14%

Laos11%

Others ASEAN

5%

North Asia5%

South Asia5%

Others21%

International sales segmentationInternational sales in Q4/15 was flat y-o-y.

Note : International business = ASEAN Operations, exports from Thailand, and Trading businessHousing - Roofing products, Board & Wood sub, and Home impro vement.Ceramics - includes Sanitary ware and Fittings.Trading - are mainly trading of non-SCG products

FY2015 Exports

FY2015 ASEAN Operations (Products)

Flat y-o-y

+6% q-o-q

39% 39% 40% 43% 38% 39% 44% 47%

28% 27% 24%

22% 31% 30% 26% 25%

33%34%

35%35% 31% 31%

30%28%

0

3,000

6,000

9,000

12,000

15,000

18,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

Trading

Exports

ASEANOperations

MB

FY2015 ASEAN Operations (Country)

Indonesia39%

Vietnam34%

Cambodia16%

Philippines8%

Myanmar3%

Ceramic46%

RMC & Precast

27%

Grey Cement

14%

Building Product

9%

Others4%

14,59316,419

15,31616,355 16,551 16,823

15,387 16,249

31

35

50 51 50 4953 51 51 49 52 49 48

0

20

40

60

80

100

120

140

160

0

10

20

30

40

50

60

70

80

90

100

Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

Baht/sqm.M sqm.

Average Price

Sales volume

Sales volume & prices for all ASEAN subsidiaries

Effect from the consolidation

-5% y-o-y

-1% q-o-q

Volume change

Ceramic Tiles Sale volume dropped -5% y-o-y due to the market softness in Thailand and Indonesia.

32

0.70.4 0.2 0.1

0.4 0.40.1 0.1 0.3 0.2 0.0 0.3

0.70.7

0.70.6

0.9 0.8

0.8 0.9

1.11.0

0.80.7

1.31.1

0.90.7

1.3 1.20.9 1.0

1.41.2

0.8 1.0

5256

6165

58 5964 63 61 62 65

58

0

10

20

30

40

50

60

70

0.0

1.0

2.0

3.0

4.0

Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

Clinker Cement Average FOB Prices

Export volume and Average price (FOB)$/TonMT

Cement exportsExports registered 1 MT in Q4/15, while pricing dropped $5/ton y-o-y as a result of the change in product mix.

Note: FOB price does not include handling charges a nd discount.

33

Outlook

Outlook:� FY2016 domestic cement demand is expected to grow +3% to +5% y-o-y, depending

on the implementation and progress of the government’s infrastructure projects.

� Domestic demand growth of housing products and ceramic tiles are projected to remain negative in FY2016

� In general, ASEAN (ex-Thailand) demand for cement and building materials products are expected to see continued growth in FY2016.

Investment updates :� Indonesia cement plant : commercial operations began in Nov/15.

� Vietnam ceramic business : to acquire the remaining 15% stake in Prime Group, with total investment of 2,190 MB. Following the transactions, SCG holds a 100% stake in Prime Group and related assets in Vietnam.

34

AGENDA



35

Q4/15 Market Situation

Q4/15 q-o-q change Notes

Crude (Brent) $44/bbl -$6/bbl (-13%)Oil markets remained oversupplied and concern over Chinese economy also weighted down crude prices

Naphtha $445/ton -$16/ton (-3%) Naphtha slumped following decreased crude prices

Ethylene $1,033/ton +$63/ton (+7%)Tight supply from the Middle East and key regional cracker’s planned/unplanned emergency shutdowns

Propylene $587/ton -$149/ton (-20%) Supply glut from new regional capacity

HDPE $1,153/ton -$81/ton (-7%) Softened demand as end-product manufacturer maintained lean inventoryPP $998/ton -$135/ton (-12%)

HDPE-Naphtha $708/ton -$66/ton (-9%)Spreads narrowed mainly due to lower product prices

PP-Naphtha $554/ton -$119/ton (-18%)

EDC $216/ton -$112/ton (-34%) Downward trend from abundant supply from the U.S.

PVC $763/ton -$68/ton (-8%) Limited demand towards year-end

PVC-EDC/C2 $349/ton +$10/ton (+3%) Spreads widened from a decline in EDC prices

MMA-Naphtha $1,025/ton -$194/ton (-16%)Dampened demand amid price competition from Chinese MMA producers

BD-Naphtha $284/ton -$240/ton (-46%)Continually weak automotive demand and more naphtha utilization from crackers

PTA-PX $64/ton +$7/ton (12%) PTA prices firmed up, supported by temporary tight supply

36

Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 To date

HDPE-Naphtha

521 585 568 590 620 618 691 802 694 812 774 708 728

Spread ($/ton)

566 682 747

HDPE-C2 87 178 166 110 113 121 125 234 161 (11) 264 120 75

C2-Naphtha 434 407 402 480 507 496 565 568 532 823 510 588 653

0

300

600

900

1,200

1,500

1,800

$/ton

HDPE-NGap Naphtha

Ethylene

HDPE

Note : Prices refer to SEA regional prices

HDPE – Naphtha Price GapsHDPE spread declined to $708/ton q-o-q as HDPE prices descended from lower demand as downstream producers kept low inventory towards year-end.

Q4/15 HDPE-N

- 12% y-o-y

- 9% q-o-q

37

Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16To date

PP-Naphtha 581 617 597 597 626 632 716 819 664 785 672 554 524

Spread ($/ton) 598 698 669

PP-C3 236 178 182 177 192 304 328 433 325 408 397 412 234C3-Naphtha 345 439 415 420 434 328 388 385 339 376 275 142 290

0

300

600

900

1,200

1,500

1,800

PP-N Gap Naphtha

PP

Propylene

PP – Naphtha Price GapsPP spread contracted to $553/ton q-o-q mainly from abundant on-purpose availabilities in China.


$/ton Q4/15 PP-N

- 32% y-o-y

- 18% q-o-q

38

Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16to date

PVC-EDC/C2 405 386 435 370 336 307 336 348 350 283 339 349 299

Spread ($/ton) 399 332 324

0

300

600

900

1,200

1,500

1,800

PVC

EDC

PVC-EDC/C2

Ethylene

PVCPVC spread improved to $349/ton, attributed to a drop in EDC prices pressured by the excess supply from the U.S.

Note: Prices refer to FE regional prices

$/ton Q4/15 PVC-EDC/C2

Flat y-o-y

+ 3% q-o-q`

39


BZ-Naphtha 420 422 325 329 355 323 394 299 161 228 196 146 180

TL-Naphtha 333 290 234 223 193 153 258 191 159 235 203 212 227

BZ-Spread 374 343 183

TL Spread 270 199 202

0

300

600

900

1,200

1,500

1,800

Benzene & TolueneBZ-Naphtha: benzene prices dropped as SM plants shut down for turnaroundTL-Naphtha: gap slightly improved attributed to high demand for gasoline blending in Asia

Toluene

Naphtha


$/ton Q4/15 Benzene-N

- 51% y-o-y

- 26% q-o-q

Benzene

Q4/15 Toluene-N

+ 11% y-o-y

+ 4% q-o-q

40

0

50

100

150

200

250

300

0

300

600

900

1,200

1,500

1,800


MMA-N 1,174 1,170 1,077 1,093 1,120 1,131 1,240 1,558 1,499 1,291 1,222 1,025 977PTA-PX 62 72 88 42 68 63 70 75 46 92 57 64 71BD-N 844 516 220 609 452 329 556 410 238 581 527 284 406

Note: BD and MMA prices refer to SEA regional prices, PTA prices refer to Asian regional prices

Price Gaps of Associates MMA-Naphtha: market squeezed from bearish demand especially in ChinaPTA-PX: gap improved as several PTA producers underwent planned/unplanned shutdownBD-Naphtha: continually weak automotive demand coupled with high naphtha cracker’s run rates

MMA-Naphtha

MMA-Naphtha $/ton , BD-Naphtha $/ton PTA-PX $/ton

BD-Naphtha

PTA-PX

41

FY14 FY15

260,000 283,000 274,000 280,000 310,000 262,000 274,000 289,000

178,000 180,000 173,000 193,000 190,000180,000 208,000 184,000

0

250,000

500,000

750,000

1,000,000

1,250,000

1,500,000

1,750,000

2,000,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

PP

PE

Polyolefin Sales VolumeQ4/15 sales volume slightly dropped 2% q-o-q and was maintained y-o-y.

Ton

438,000 463,000

762,000

447,000 473,000 442,000

725,000

1,096,000 1,135,000

1,897,0001,821,000

500,000 482,000

Flat y-o-y

- 2% q-o-q

473,000

42

0

100,000

200,000

300,000

400,000

500,000

600,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

ASEAN Operations

Domestic Operations

FY14 FY15

PVC Sales VolumeQ4/15 sales volume was stable with the growth of 1% q-o-q, but improved 12% y-o-y from the additional capacity from VCM debottlenecking.

Note: *ASEAN Operations = Sales volume from PVC ope rations in Vietnam and Indonesia

181,000161,000

734,000687,000

176,000 169,000 177,000

71% 69% 70% 68% 69%

70% 68%

32%30%

31%32%30%31%29%

179,000

68%

32%

188,000

66%

34%

Ton + 12% y-o-y

+ 1% q-o-q

189,000

36%

64%

43

FY14 FY150

25,000

50,000

75,000

100,000

125,000

150,000

175,000

200,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

Note: * ASEAN operations = Sales revenue from PVC o perations in Vietnam and Indonesia

Revenue from SalesQ4/15 revenue decreased to 47,250 MB corresponding to softened crude prices.

60,826 64,958 64,33757,997

47,956

MB

53,636

248,118

200,433

51,591

- 19% y-o-y

- 8% q-o-q

47,250

44

4,834 4,671 5,745 6,151 6,600

13,16910,861 9,921153 970

1,863 1,755 111

1,452

42 744

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

Dividend


FY14 FY15

21,401

Note: EBITDA = EBITDA from Operations + Dividend fr om Associated Companies

EBITDAQ4/15 EBITDA dropped slightly q-o-q to 10,665 MB from lower spreads.

EBITDA 8% 7% 9% 11% 14% 25% 21% 21% 9% 20% Margin

5,6414,987

42,900

7,608 7,906 6,711

MB

14,621

10,903

4,74140,551

2,349

26,142

+ 35% y-o-y

- 2% q-o-q

10,665

45

FY14 FY15

678 4451,107 565

1,495

2,900

1,4561,348

0

2,500

5,000

7,500

10,000

12,500

15,000

17,500

20,000

22,500

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

Equity Income

Subsidiaries

NCI (330) (240) (650) (740) (680) (3,600) (1,540) (1,140) (1,960) (6,960) (Non controlling interest)

Inventory 180 (80) (130) (2,960 ) (930) 970 (2,160) 330* (2,990) (1,790) Gain (Loss)**

2,480 2,259

Profit for the PeriodQ4/15 profit increased to 7,530 MB, with no FX and inventory loss.FY2015 performance improved significantly by 129% y-o-y from lower feedstock. .prices.

*Sub/Asso : 63%/37% **Note: SCG Chemicals (Sub + Asso)

4,188

7,199

3,534

2,795

MB

4,938

9,182 12,461

28,488

6,838

+ 113% y-o-y

+ 10% q-o-q

7,530

46

Outlook

� Crude – crude prices stay low from U.S. excess supply and lifted Iran’s sanctions.

� Naphtha – naphtha fallowing crude oil prices amid tight supply from refinery turnaround.

� Polyolefin – buyers take hand-to-mouth approach awaiting clearer price direction.

� PVC – prices remain weak due to slow restocking activity and strong price competition.

Company highlight:

� Chandra Asri – completed cracker’s debottlenecking with ethylene capacity increased from 600 KTA to 860 KTA, and expected to fully ramp up by February.

� Longson Petrochemical Complex – negotiating with new potential partners.

47

AGENDA



48

Packaging PaperPackaging paper prices continued to decline due to soft regional demand. Similarly, AOCC prices dropped due to demand softness among key Chinese importers.

Note: regional prices

0

150

300

450

600

$/Ton

Packaging Paper

Recovered Paper (AOCC)

Jan/16

165-175

445-455

Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15

490490495 490 480

200210 195 195 180

Q4

470

Q2/15

190

Q3/15

460

190

Q4/15

450

180

49

64% 61% 60% 58% 59% 57% 57% 57%

12% 14% 15% 19%20% 21% 21% 21%

24% 25% 25% 23%21% 22% 22% 22%482 488 496 500 528 539 552 561

0

100

200

300

400

500

600

700

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

ASEAN Operations*

Thailand Export

Thailand Domestic

Packaging PaperTotal sales volume increased 2% q-o-q and 12% y-o-y owing to higher domestic and export sales.

’000 tons

Note: *Sales Volume from Philippines and Vietnam

(65%) (67%)

61% 58%

15%

20%

24%

22%1,967

2,180

0

400

800

1,200

1,600

2,000

2,400

FY2014 FY2015

+12% y-o-y

+2% q-o-q

+10% y-o-y

+1% q-o-q

50

Fibrous (Printing & Writing Paper)Printing & Writing paper prices declined from continued weak demand. Short fiber pulp prices decreased due to oversupply, while dissolving pulp price increased to $895/ton owing to sustained Chinese demand.

200

400

600

800

1,000

Short Fiber

P&W Paper

Long Fiber

$/Ton

725-735

575-585

Jan/16

555-565

815805 800 795 795

710730 705 705645

570605 555 570 595

Q4

Note: regional prices

Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15

785

660

630

Q3/15

755

630

645

Q4/15

735

595

620

51

Fibrous (Printing & Writing Paper)Total sales volume decreased 2% q-o-q and 5% y-o-y due to continued sluggish demand.

75% 73%

25% 27%

477 476

0

100

200

300

400

500

FY2014 FY2015

79% 76% 72% 72% 75% 73% 73% 72%

21%

24%28% 28% 25%

27% 27% 28%

121 111

123 122 123 119 118 116

0

50

100

150

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

Domestic Export’000 tons

-5% y-o-y

-2% q-o-q

-5% y-o-y

-2% q-o-q

Flat

52

Revenue from SalesRevenue from Sales in Q4/15 increased 1% q-o-q and up 11% y-o-y mainly from higher domestic and export sales in packaging chain.

11,342 11,492 11,703 11,827 12,390 12,621 13,341 13,645

4,611 4,364 4,573 4,7024,721 4,551

4,876 4,762 15,953 15,856 16,276 16,529 17,111 17,172

18,217 18,407

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

Packaging Chain Fibrous ChainMB

+11% y-o-y

+1% q-o-q

46,364 51,997

18,250

18,910

64,614

70,907

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

FY2014 FY2015

MB

71% 72% 72% 72% 72% 73% 73% 74% 72% 73% Packaging as percent of total

53

2,7892,569

2,1522,208

2,6932,512 2,580

3,046*

1,255

887715 591

878764

645

1,176*

0

500

1,000

1,500

2,000

2,500

3,000

3,500

Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15

+99% y-o-y

+82% q-o-q

3,448 3,463

FY2014 FY2015

MB

15% 15%*15% 15%*EBITDA Margin

EBITDAEBITDA

Profit for the period (MB)

EBITDA and Profit for the PeriodPerformance in Q4/15 improved q-o-q with EBITDA increased 18% and Profit increased 82% mainly from non-recurring item (sale of TBSP shares).

9,718

10,831

FY2014 FY2015

EBITDA (MB)+38% y-o-y

+18% q-o-q

Profit for the periodProfit for the period

Packaging 19% 18% 15% 15 % 17% 16% 15% 15%

Fibrous 15% 12% 12% 9% 13% 11% 12% 12%

EBITDA Margin

Total 17% 16% 13% 13% 16% 15% 14% 17%*

*Remark : Include gain from sale of TBSP shares.

Gain from sale of TBSP shares

Flat

54

Outlook:� Demand for packaging is expected to increase slightly both domestically and within

the region.

� Regional packaging paper prices are expected to maintain due to competition.

� Recovered paper prices expect to decrease further due to Lunar New Year downtime plans in China causing demand softness.

� Long fiber and short fiber prices expect to decline as a result of weak demand amidst abundant supply.

Updates:� SCG Packaging has sold 3,520,000 shares (32%) of Thai British Security Printing

Public Company Limited (or “TBSP”) to an investor, with the remaining 18% to be sold within 5 years. The combined value of the transaction is approximately 720 Million Baht.

Outlook

55

AGENDA



56

Thank You

Summary

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