PTT’s ฿8.4Bn Gain in Oil Price Hedging Mitigates Loss in 1Q20 to Only ฿1.5Bn

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

PTT reported a net loss of 1,554 million baht, contrasted to a net profit of 29,312 million baht in 1Q19, in line with a decrease in EBITDA, an increase in depreciation and amortization expenses mainly from the E&P and TEG Businesses’ acquisition, more loss from foreign exchange loans, and higher tax expenses from the depreciation of Thai Baht against US Dollar despite the increase in gain on derivatives.

In the First quarter of 2020, PTT reported EBITDA decrease by Baht 48,138 million or 59.8% when compared to 1Q2019. This was mainly due to the Petrochemical and Refining businesses’ stock loss in 1Q2020 from the significant drop in crude oil price.

The performance of oil business decreased from higher stock loss and lower sales volume during the COVID-19 pandemic. Nevertheless, the performance of TEG business improved particularly from GPSC’s performance according to the acquisition of GLOW in March 2019.

 

In 1Q2020, sales revenue of PTT was Baht 483,567 million, decreased by Baht 67,307 million or 12.2% from 1Q2019 mainly from most business groups due to lower selling prices and sales volume besides the sales revenue fromTechnology and Engineering business and Exploration and Production Business.

The sales revenue of the Technology and Engineering business increased owing to GPSC’s acquisition of GLOW by the end of 1Q2019 and increased due to higher sales volume from the PTTEP’s acquisition of the Malaysia projectand Partex in 2H2019 together with the increase in Bongkot project sales volume from fewer maintenance shutdown days in 1Q2020 than 4Q2019 while the average selling price decreased.

More importantly, PTT reported an increase in gain on derivatives to Baht 8,470 million in 1Q20 from loss on derivatives of Baht 3,780 million in 1Q2019. The increase was mainly due to unrealized gain on oil price hedging instruments of PTTEP and PTTT.