Post on 12-Mar-2018
GLOW ENERGY PLC.
Date : 13 May 2015
Results for 1Q/2015
Disclaimer
The views expressed here may contain information derived from publicly available sources that
have not been independently verified. No representation or warranty is made as to the accuracy,
completeness or reliability of the information. Any forward looking information contained in this
presentation has been prepared based on number of assumptions which may be incorrect and/or
not properly represent actual situation incurring in the future. The actual information contained in
this presentation is for the purpose of illustration and presentation only. Should there be any
discrepancies with audited/reviewed financial statements, annual report, and other official filings to
SEC, the information presented in such documents should be relied upon as official information.
This presentation should not be relied upon as a recommendation or forecast by Glow Group.
This presentation shall not be construed as either an offer to sell or a solicitation of an offer to buy
or sell shares in any jurisdiction.
2 GLOW GROUP – Results of 1Q/2015 – 13/05/2015
HEADLINE
COMMENTS
3 GLOW GROUP – Results of 1Q/2015 – 13/05/2015
4 GLOW GROUP – Results of 1Q/2015 – 13/05/2015
Headline Comments • NNP reported at 2,286 MTHB for 1Q15, being 10% increase YoY and 13% increase QoQ.
• Robust operational performance.
• High maintenance activity (including Gheco1 and CFB3).
• Material Other Income items (Doosan Settlement: 733 MTHB at Gheco1 level; CFB3 Insurance: 250
MTHB).
• NNP excluding these Other Income items would have been 1.7 billion THB.
• Cogeneration Business
• CFB3 Insurance
• Volumes down slightly (power -1% YoY;
steam -4% YoY including as a result of
maintenance/tie-in activities for a major
customer).
• Still fairly stable spread environment
(notwithstanding drop in oil prices).
• 10 Satang Ft reduction in January; Ft
back to the Q1 2014 level.
• Gas-to-power spread down slightly YoY;
Coal-to-power spread up.
• Higher generation from CFB’s,
notwithstanding CFB3
scheduled/unscheduled maintenance.
• Gheco-One
• Doosan Settlement
• Maintenance (completed on schedule)
resulting in lower availability payments
for the quarter, lower energy margin and
higher maintenance costs.
• Strong availability and high dispatch
since re-commissioning.
• GIPP
• Significantly lower dispatch (60% YoY),
somewhat lower availability.
• HHPC
• Lower dispatch (2014 higher because of
2013 transmission line incident).
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 5
RESULTS
OVERVIEW
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 6
• Financial Lease
• From 1Q/2014, Thai GAAP has started adopting a new accounting standard with respect to Financial Lease. In our view, the
changes resulting from the adoption of this new accounting standard do not affect cash flows and are therefore not directly
operations-related. We therefore show results excluding the impact of Financial Lease, except when mentioned.
• Normalized Net Profit
• Glow’s management focuses on core profitability. Therefore, we consider Normalized Net Profit (NNP) as our key profitability
metric. NNP is defined as Net Profit, excluding (i) Net Unrealized FX Gains/Losses, (ii) Deferred Tax Income/Expense, and
(iii) the impact of the Financial Lease treatment. NNP is also the metric we focus on in considering our dividend payments.
• Unrealized FX Gains and Losses.
o Glow IPP, GHECO-One and HHPC have outstanding loans in USD which will be repaid with USD linked cash flows.
o Under Thai GAAP the outstanding USD loan is converted at year-end to THB at the then current exchange rate. Any
difference in the outstanding loan amount in THB resulting from a change in exchange rate compared to last year
leads to an Unrealized FX Gain (THB appreciation) or Loss (THB depreciation).
o Since the USD loans in Glow IPP, GHECO-One and HHPC are served by USD linked cash flows, these Unrealized
FX Gains/Losses should, in Glow’s view, be ignored from an economic point of view.
• Deferred Taxes
o From 1Q/2013, Thai GAAP has started adopting Deferred Tax accounting practices. In our view, Deferred Tax
Income/Expense is an accounting item resulting from differences in accounting and tax book values, and is therefore
not directly operations-related.
General Comments
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 8
1Q/2015 Headline P&L 1Q2015 Act 1Q2015 Act without lease
with lease without lease vs with lease
Revenue 15,999 16,256 257
Gross Margin 6,001 6,257 257
EBITDA 4,696 4,953 257
Depreciation 1,104 1,188 84
EBIT 3,592 3,765 173
Exchange Gain(Loss) 109 109 0
- Realised exchange gain / loss (69) (69) 0
- Unrealised exchange gain / loss 178 178 0
Profit Before Tax 2,925 3,098 173
Corporate Income Tax 429 429 (0)
Deferred Tax (4) 25 29
Net Profit 2,183 2,319 137
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 9
1Q/2015 P&L Comparison (without lease) Difference
2015 Act 2015 Act
2014 Act 2015 Act vs 2014 Act vs 2014 Act (%)
Revenue 18,197 16,256 (1,941) -10.7%
Gross Margin 5,762 6,257 495 8.6%
EBITDA 4,734 4,953 219 4.6%
EBIT 3,492 3,765 272 7.8%
Exchange Gain(Loss) 191 109 (82) (42.8%)
- Realised exchange gain / loss 14 (69) (82) -596.5%
- Unrealised exchange gain / loss 177 178 1 0.4%
Profit Before Tax 2,835 3,098 262 9.2%
Corporate Income Tax 262 429 167 63.6%
Deferred Tax 33 25 (9) (26.4%)
Net Profit 2,177 2,319 142 6.5%
Normalised Net Profit 2,076 2,286 210 10.1%
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 10
SELECTED
KEY DRIVERS
1227
897
YTD Mar/2014 YTD Mar/2015
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 11
IPP Availability and Dispatch IPP Business
GHECO1 Dispatch (GWh)
HHPC Dispatch (GWh)
1291
510
YTD Mar/2014 YTD Mar/2015
118 98
YTD Mar/2014 YTD Mar/2015
GIPP Dispatch (GWh)
-60.5%
GIPP Availability
98.1% 95.36%
YTD Mar/2014 YTD Mar/2015
GHECO1 Availability
89.25% 56.26%
YTD Mar/2014 YTD Mar/2015
1,272 (-1.5%)
796 (-37.4%)
963 (+21.0%)
1,292 509 (-47.1%)
414 415 463
360 467 445 458
126 212
272
426
265
83 75
351
0
200
400
600
Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15
310
438 479 467 484 475 492 471 448 475 473 450
43
364
490
0
100
200
300
400
500
600
Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15
1,426 (+16.3%)
1,411 (-1.1%)
1,398 (-0.9%)
1,227 897 (-35.8%)
226 (+92.6%)
119 (-47.5%)
146 (+22.9%)
117 98 (-33.1%)
0
43
74 72 77 77 65
26 28
68
43 35
10
26
61
0
20
40
60
80
100
Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15
Extensive periods of reserve shutdown during 1Q 2015 (Unit1: 39 days and Unit2: 42 days).
Planned maintenance during Jan-Feb/2015.
Transmission Line outage in 4Q/2013 and restoration works completed in
Jan/2014.
Planned maintenance during 27/Jan-05/Feb/2015.
-26.9%
-16.9%
670
732
YTD Mar/2014 YTD Mar/2015
GLOW GROUP – Results of 1Q/2015 – 13/05/2015
592
700
YTD Mar/2014 YTD Mar/2015
12
Cogen Main Assets Generation Volumes Cogen Business
CFB 1-3 Dispatch (GWhe)
+18.3%
Phase5 Dispatch (GWhe)
810 (+21.0%)
726 (-10.3%)
813 (+12.0%)
670 732 (-10.0%)
233
159
278 276 269 265 241 258
227 273 266 275
232 210
291
0
50
100
150
200
250
300
350
Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15
CFB2: 6 days of unplanned outages in Feb/2015
CFB3 :Load gear incident during 10/Jan/2014 – 12/Jul/2014 (70% load); 32 days scheduled/unscheduled maintenance during Jan
to Feb.
709 (+19.8%)
806 (+13.7%)
704 (-12.7%)
591 700 (-0.06%)
259 235
97
205
267 237
264 275 267 263
215 226 279
223 199
0
50
100
150
200
250
300
Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15
1) Average steam conversion - Gas is 3.95 ton/MWheq and Average steam conversion – Coal is 2.90 ton/MWheq
+9.4%
8-day planned minor maintenance (27/Feb-06/Mar/2015).
Major maintenance in Mar/2014.
1839
1762
YTD Mar/2014 YTD Mar/2015
1265
1247
YTD Mar/2014 YTD Mar/2015
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 13
Industrial Customer Volumes Cogen Business
IC Power Sales (GWh)
IC Steam Sales (ktons)
1,284 (+1.5%)
1,332 (+3.7%)
1,219 (-8.5%)
1,265 1,247 (+2.3%)
450 379
436 444 437 403
434 451 447 444 372
403 437
390 420
0
100
200
300
400
500
Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15
1,814 (-1.4%)
1,948 (+7.4%)
1,785 (-8.4%)
1,840 1,762 (-1.3%)
616 587 637 616 594 604 654 664 630 630 539
616 634 560 568
0
100
200
300
400
500
600
700
Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15
Mostly maintenance (and tie-in) activities for 2 key customers.
Favorable impact of market conditions (including high ethylene, HDPE and PP spreads) compensated by site-specific
factors for 1 key customer.
-1.4%
-4.2%
0.9
1.1
1.3
1.5
1.50
2.00
2.50
3.00
3.50
Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 14
Normalized Spread Trends Cogen Business
1) PEA Price = Base Tariff at 2.8 THB/kWh + actual FT 2) Gas Cost = Blended Cogen gas price in THB/mmBTU x normalized gas-fired
heat-rate at 8,600* BTU/kWh / 10^6 3) Coal Cost = Average FOB coal price in THB/mmBTU x normalized coal-fired
heat-rate at 10,300 BTU/kWh / 10^6
Note :
2.43 THB/kWh
0.54 THB/kWh
Avg. PEA Price
(LHS)
Gas Cost
(LHS)
Coal Cost
(RHS)
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 15
YoY Prices/Spreads Comparison Cogen Business
YTD Mar/2014 YTD Mar/2015
326
330 Average Gas Price (THB/mmBTU)
+1.0%
YTD Mar/2014 YTD Mar/2015
87.92
76.22
Average Coal Price (USD/ton JPU)
YTD Mar/2014 YTD Mar/2015
3.37 3.37
Average PEA Price (THB/kWh)
0.0%
-13.3%
YTD Mar/2014 YTD Mar/2015
0.57
0.54
Average Gas Spread (THB/kWh)
YTD Mar/2014 YTD Mar/2015
2.26
2.41
Average Coal Spread (THB/kWh)
+6.5%
-5.2%
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 16
VARIANCE
ANALYSIS
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 17
1Q/2015 vs. 4Q/2014
NNP 4Q/2014 Act Cogen Business GIPP GHECO-1 HHPC NNP 1Q/2015 Act
2,018
367 8 (61) (46) 2,286
NNP 1Q/2014Act
NNP 2Q/2014Act
NNP 3Q/2014Act
NNP 4Q/2014Act
Gross Profit MaintenanceCosts
OtherOperating
Costs
Depreciation& Asset
Replacements
FinanceExpenses
Income Tax MinorityInterest(MI)
NNP 1Q/2015Act
2,076
3,133
2,442 2,018
229 (163) 254 71 42 (198) 33 2,286
EBITDA Impact +320 MTHB Below EBITDA
-85 MTHB
NNP 1Q/2014 Act Gross Profit MaintenanceCosts
Other OperatingCosts
Depreciation &Asset
Replacements
Finance Expenses Income Tax MinorityInterest(MI)
NNP 1Q/2015 Act
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 18
1Q/2015 vs. 1Q/2014
NNP 1Q/2014 Act Cogen Business GIPP GHECO-1 HHPC NNP 1Q/2015 Act
2,076
372 (64) (81) (17) 2,286
2,076
EBITDA Impact +178 MTHB
Below EBITDA -41 MTHB
495 11
54 72 (167) 33 2,286 (328)
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 19
FINANCIAL
STATUS
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
23 17 18 13
7 7 8
8
9 10 10 11 10
66 60 57 63
37 33 30 36 35
29 24 29 25
88
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 20
Debt Maturity Profile
2015 2016 2017 2018 2019 2020 2021
4,000
5,500
1,000
1,500
4,600
4,000 3,400
5,555
Glow Cogen Repayment Profile (MTHB)
5,500 5,500 5,600
4,000
3,400
5,555
Bank loan Bond
Note: 1) Value of debts for IPP Business consists of 19,359 MTHB for GHECO-One, 2,313 MTHB for Glow IPP, and 2,635 MTHB for HHPC
2) GHECO-One Loan consists of USD tranche and THB tranche (converted @ 30 Baht/USD)
3) HHPC outstanding debt as of 31 March 2015 is 81 MUSD after refinancing in January 2015
GHECO-One(2)
HHPC(3)
Glow IPP
Consolidated Glow Group Gross Debt
1Q2014 1Q2015
28,038 24,307
36,193
30,070
USD loan (excluding tranches swapped into THB), as of Mar 2015
• GIPP: 71 MUSD
• GHECO-One: 363 MUSD
• HHPC: 81 MUSD
Total Gross consolidated Debt was
• 64,231 MTHB in 1Q 2014 versus
• 54,377 MTHB in 1Q 2015
Cogen Business
IPP Business(1)
64,231
54,377
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 21
Gearing Indicators
1Q2014
1Q2015
D/E Ratio
Conso: Gross D/E (Net D/E) 1.50 (1.32) 1.13 (0.98)
Cogen: Gross D/E (Net D/E) 0.84 (0.79) 0.63 (0.58)
Debt to EBITDA (Conso)
Gross Debt to EBITDA (Net Debt to EBITDA) 3.47 (3.07) 2.58 (2.23)
Note: 1.) Gross D/E = Total Outstanding Debts / Total Equities
Net D/E = (Total Outstanding Debts – cash) / Total Equities
Gross Debt to EBITDA = Total Outstanding Debts / EBITDA
Net Debt to EBITDA = (Total Outstanding Debts – cash) / EBITDA
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 22
Dividends Policy and History
• Our policy is (in simplified terms) to pay “a normal dividend of not less than 50% of NNP”.
• Additionally, since our IPO (2005) we have grown our (normal) dividend by at least 5% per year.
• 2013 and 2014 dividend growth reflects strong increase in profitability following the completion of our 2008/2012 expansion
program (80% increase in installed capacity).
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
0.600 0.600 0.600 0.700 0.735 0.772 0.810 0.851 1.100
1.500
0.975 1.054 1.136 1.123
1.179 1.238
1.300
1.904
2.205
0.750
Special
Annual
Interim
Dividend Split (THB/share)
2.250
1.575 1.654
1.736 1.823
1.914 2.010
2.110
2.755
3.305
+5% +5% +5%
+5% +5%
+5%
+31%
+20%
38% 36% 35% 38% 38% 38% 38% 31% 33%
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 23
SELECTED
UPDATES
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 24
Gheco-One’s “Doosan Settlement”
Nov-11 ---------------------- Aug-12 ------------------- Mar-15 Apr-15
Record DLD Record DLD
Net Cash
Settlement Record DLD
Scheduled
COD
Actual COD
Costs resulting
from Delay Last Milestone
Payment Withheld
25 – Yrs PPA
• Full and final settlement of all disputes (including with respect to DLD’s, damages, etc.) with respect to the Gheco-
One EPC contracts.
• Settlement Agreements have been executed in March 2015.
• Cash Settlement has occurred in April 2015.
• Other Income 1Q 2015 (733 MTHB or approximately 24 MUSD) reflects earlier accrual of expected DLD’s:
• 546 MTHB in (4Q) 2011.
• 1,046 MTHB in (1Q) 2012.
• Net Cash Settlement in April 2015 (payment of approximately 32 MUSD from Doosan to Glow) reflects, among
others:
• Previously withheld milestone payment (due to Doosan).
• Structure comprises a (smaller) in kind component.
GLOW GROUP – Results of 1Q/2015 – 13/05/2015 25
THANK YOU