IRPC Faces a Net Loss in 1Q20 after Recording Higher Stock Loss and Lower Sales

IRPC Public Company Limited (IRPC) has reported its 1Q20 consolidated financial statement through the Stock Exchange of Thailand as follows;

IRPC reported a net loss of 8,904 million baht in 1Q20, plunged from a net profit of 152 million baht in 1Q19 mainly due to a net stock loss totaling 6,811 million baht and a drop in sales revenue.

IRPC’s net sales dropped by 10,657 million baht or 20%, including a 14% decrease in product price as well as 6% decrease in sales volume. The average crude intake was 188,000 barrels per day, declined by 6%. The Market GIM decreased by 1,293 million baht or 26% (declined by USD 1.86 per barrel) mostly caused by the drop of products spread both petroleum and petrochemical businesses amidst the U.S.–China trade war tension combined with the COVID-19 outbreak.

IRPC stated that the crude oil price collapsed during 1Q20. At the beginning of the quarter, Dubai price was USD 67.3 per barrel compared to USD 23.4 per barrel at the end of the quarter, down by USD 43.9 per barrel amid supply glut situation because OPEC and its partners were unable to reach an agreement for production cut. Together with the pandemic of COVID-19, the number of infected people kept growing leading to the limitation of economic activities and the lockdown measures resulting in a dramatic drop in oil demand. These caused IRPC to have a net stock losstotaling 6,811 million baht or USD 12.66 per barrel including the stock loss of 4,461 million baht and a loss of LCM amounting to 2,673 million baht against oil hedging gain of 323 million baht.