2q08 performance - listed...

Analyst Meeting2Q08 PerformanceTuesday 19 August 2008

2

Agenda

2Q08 Management HighlightsSales ReportGRM & Plant UtilizationCAPEX Industry OutlooksFinancial PerformanceAppendix

3

1H08 Highlight

Overview High volatilities in crude prices resulting from US economic slowdown, weaken USD, and tensions on ongoing geopolitical concerns in a number of producing countries, including Nigeria, Iraq, Israeli and Iran on conflict in nuclear issue.

Average crude cost is relatively higher from 92 $/bbl in 1Q08 to 117 $/bbl in 2Q08 2Q08 average crude run at 85%, slightly increased resulting from better gas oil spread.Integrated GRM in 2Q08 at 11 $/bbl: Petrochemical GRM 4.1 $/bbl and Refinery GRM 6.9 $/bbl or 1.4 B/Lt.

Cost reduction programs continue, 1H08 cost reduced by Baht 640 million or USD 20 million

Finance Fitch Ratings (Thailand) affirmed IRPC’s National Long-term rating at “A-(tha)” and National Short-term rating at “F2(tha)”. The Outlook on the ratings remain “Stable”.

Forbes ranked IRPC the 1434th biggest companies in the world on 2 April 2008.

1st ESOP exercised on 30 June 2008, executed only 0.7% of total shares.

Operation ABS expansion project ($70 million) got approval from BOD and ready to proceed

4

Sales Report

5

Export33%

Domestic67% Domestic

64%

Export & Re-

export36%

1H08 Product Sales Value by MarketOil products

(~ 73% of sales value)Petrochemical products(~ 26% of sales value)

1H08 sales included Baht 5,196 million or USD 160 million excise tax & all oil funds

2007 : FX 34 Baht/USD, 1Q08 : FX 32.40 Baht/USD, 2Q08 : FX 32.60 Baht/USD

mill.Baht Oil Petrochem. Total mill.USD Oil Petrochem. Total1H07 73,938 + 30,588 = 104,526 OR 1H07 2,174 + 900 = 3,074 1H08 98,590 34,956 133,546 1H08 3,033 1,075 4,108

6

Diesel53%

Mogas9%

Naphtha4%

Lube5%

Asphalt Wax8%

ATB18%

LPG2% Others

1%

Fuel Oil0.2%

Diesel62%

ATB12%

Lube6%

Mogas10%

Naphtha4%

Asphalt Wax4%

LPG0.5%

Fuel Oil0.2%

Others1%

1H08 Petroleum Product Sales

1H08 Volume = 3,942 m Ltrs1H07 Volume = 4,135 m Ltrs

1H08 Value = Bt 98,590 m1H07 Value = Bt 73,938 m

Volume Value

2Q08 Volume = 1,955 m Ltrs1Q08 Volume = 1,987 m Ltrs

2Q08 Value = Bt 54,484 m1Q08 Value = Bt 44,106 m

7

CD-13%

EPS2%

PS9%

Polyol1%

Others2% EB/SM

0.5%

HDPE8%

Olefins14%

BTX21%

ABS7%

PP32%

BTX15%

Olefins14%

HDPE9%ABS

9%CD-13%

EPS2%

PS10%

Others0.5%

Polyol2% EB/SM

1%

PP35%

Q2’07 Petrochemical Products Sale

1H08 = 755,137 M/T1H07 = 738,606 M/T

1H08 = Bt 34,956 m 1H07 = Bt 30,588 m

1H08 Petrochemical Product SalesVolume Value

2Q08 = 390,186 M/T1Q08 = 364,951 M/T

2Q08 = Bt 18,499 m 1Q08 = Bt 16,457 m

8

GRM & Plant Utilization

9

5.3

8.7

3.21.9

4.3

7.15.0

6.44.7

5.7 5.8

4.0

3.7

7.1

5.5

6.6

5.6

6.34.7

5.2

5.84.5

6.9

4.2

4.1

5.4

11.0

9.6

11.09.9

11.5

10.39.4

12.4

10.3

7.4

10.9

12.7

11.3

0

2

4

6

8

10

12

14

1Q06

2Q06

3Q06

4Q06

1Q07

2Q07

3Q07

4Q07

1Q08

2Q08

2006

2007

1H08

GRMPetchem &others

GRM Oil

IntegratedGRM

2Q08 GRMUS$ / bbl

10

87% 86%90%

38%

68%

79%

89% 89% 89%83%

87%91% 93%

88%

82% 85% 83%88% 85%

81% 84% 82% 83% 84%

90%85% 85%85%

86%

0

20

40

60

80

100

120

140

160

180

200

JAN FEB MAR APR MAY JUN. JUL. AUG. SEP. OCT. NOV. DEC. Y. AVG.0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2006 Crude run 2007 Crude run 2008 Crude run 2006 % utilization 2007 % utilization 2008 % utilization

Capacity UtilizationKBPCD

Refinery Capacity Utilization

Petrochemical and Lube

Remark: Utilization 2008 = 1H08 annualized

1Q07 2Q07 3Q07 4Q07 2007 1Q08 2Q08 1H08% Utilization 87% 88% 87% 90% 88% 84% 85% 85%

0100200300400500600700800

Ethylene

Propylene

Butadiene

Benzene

Toluene

Mixed Xylene SM

HDPE PPABS/AS PS EPS

Lube Base Oil

Asphalt

% U

tiliz

atio

n

020406080100120140160

KTA

Nameplate Capacity (LHS) Utilization 2007 (LHS) Utilization 2008 (LHS)%Utilization 2006 (RHS) %Utilization 2007 (RHS) %Utilization 2008 (RHS)

11

CAPEX

12

Future Project ProgressAs of July 2008 CAPEX

Amount (Million USD)

Benefit/year (Million

USD/year)

% IRR Start Complete Progress Purpose

Phase IHDPE Compound 12.60 3 21% 2Q07 1Q09 84% Increase capacity from 17 KTA to 57 KTA

ABS Expansion 17.10 4 21% 2Q07 1Q09 89% Increase capacity from 96 KTA to 117 KTA

Power Plant 220.00 39 23% 2Q07 3Q09 40% CHP 216 MW for internal use, reduce power & steam cost, improve power stability

Safety Improvement 39.00 n/a n/a 2011 41%

Total 288.70 46

Phase IIABS Expansion 6 70.00 n/a 21% 2008 2010 Increase capacity from 117 KTA to 200 KTA

New Reg_EURO IV 360.00 n/a 14% 2009 2011 Comply to regulation

Petroleum Improvement

620.00 n/a 22% 2009 2011 Increase capacity from 215 to 265 kbpd & improve product slate

Propylene Booster 88.00 n/a 36% 2009 2011 Increase capacity by 100 KTA

Port Dredging 46.00 n/a 16% 2009 2011 Accommodate 300,000 ton VLCC

Total 1,184.00

Grand Total 1,472.70

13

Industry Outlooks

14

Industry Outlooks

Very volatile & No more cheap crude oilGeopolitical tension / Supply concernsHigher finding cost for new oil reserveUS Dollar fluctuationGrowing demands in Asia

Crude OilIs the recently declining in crude price a Bubble Burst?

Tagging along crude oil pricesApproaching lower season in the third quarterRecently declining of crude prices and government’s excise tax cut could boost short term domestic demand

Refined Products

Close watch on naphtha pricesNew capacity addition from MELower demand from China

Petrochemical Products

15

Financial Performance

16

Financial HighlightsUnit: Million Baht 2Q08 2Q07 %YoY 1Q08 %QoQ 1H08 1H07 %YoYSales 73,740 55,276 33.4% 61,258 20.4% 134,997 105,827 27.6%Net Sales 71,521 50,845 40.7% 58,280 22.7% 129,801 97,157 33.6%Cost of Goods Sold (63,912) (45,012) 42.0 (55,481) 15.2 (119,392) (87,829) 35.9 Gross Profit 7,609 5,833 30.5% 2,799 171.9% 10,408 9,328 11.6%Gross Margin 10.6% 11.5% 4.8% 8.0% 9.6%Other Revenue 245 145 118 363 328 SG&A (935) (1,203) -22.3% (782) 19.5% (1,717) (2,087) -17.7%EBITDA 6,919 4,775 44.9% 2,134 224.2% 9,054 7,568 19.6%EBITDA Margin 9.7% 9.4% 3.7% 7.0% 7.8%Depre. & Amort. (820) (765) (817) (1,637) (1,530) EBIT 6,099 4,008 52.2% 1,317 363.0% 7,417 6,038 22.8%Net Interest Expenses (247) (30) (252) (498) (89) Pretax Profit 5,853 3,978 47.1% 1,066 449.1% 6,919 5,949 16.3%Taxes (18) (14) (9) (27) (23) Net Profit before Extra. 5,835 3,965 47.2% 1,056 452.3% 6,890 5,926 16.3%Doubtful Account (7) 173 (10) (16) 57 FX. Gain/(Losses) (474) 273 953 (149.7) 479 723 (33.8) Investment Gain (Loss) (257) 510 (367) (624) 960 Asset Gain (Loss) 33 40 0 33 59 Other Expenses (4) (5) (5) (9) (10) Net Profit 5,126 4,956 3.4% 1,628 214.8% 6,753 7,715 -12.5%No. Share (M.) 19,500 19,500 19,500 19,500 19,500 Norm. EPS 0.30 0.20 0.05 452.3% 0.35 0.30 16.3%EPS 0.26 0.25 0.08 214.8% 0.35 0.40 -12.5%BV 4.90 4.58 4.84 4.90 4.58 8.9%

17

Balance Sheet: Healthy financial position

61,388

48,798

17,642

82,953

15,071

29,804

62,311

58,191

12,673

92,777

21,945

18,454

63,652

80,628

4,714

95,643

24,726

28,625

2006 2007 1H08

Interest Bearing Debt

Other Liabilities

Equities

Cash & S/T Investment

Other Assets

PP & E

Treasury policy :

Net Debt/Equity < 1.0x

Net Debt/EBITDA < 2.0x

133,175127,828

Current Status

= 0.25x

= 1.32x

Unit: Millon Baht148,994

18

Key Financial Ratios

2Q08 2Q07 1Q08 1H08 1H07

Liquidity & Leverage Ratio (Times)Quick Ratio 0.93 1.49 1.29 0.93 1.49 Total IBD / Equity 0.30 0.10 0.19 0.30 0.10 Net IBD / Equity 0.25 0.04 0.11 0.25 0.04 Liabilities / Equity 0.56 0.31 0.41 0.56 0.31 Net IBD / EBITDA 1.32 0.25 1.22 1.32 0.25 IBD / EBITDA 1.58 0.58 2.07 1.58 0.58 EBITDA / Interest Exp. 25.94 18.36 6.82 33.95 14.52

Profitability RatioGross Profit Margin 10.6% 11.5% 4.8% 8.0% 9.6%EBITDA Margin 9.7% 9.4% 3.7% 7.0% 7.8%Net Profit Margin 7.2% 9.7% 2.8% 5.2% 7.9%ROE 14.1% 17.3% 6.9% 14.1% 17.3%ROCE 10.9% 15.7% 5.8% 10.9% 15.7%

19

Appendix

20

20

40

60

80

100

120

140

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Price :$/BBL

0

10

20

30

40GRM : $/BBL

Dubai 2007

Dubai 2006

S’pore GRM 2007

Dubai 2008

S’pore GRM 2008

Tight Markets: Crude prices skyrocket

Crude prices driven by:Supply concerns Geopolitical tensionHigher finding costWeakening US DollarGrowing demands in Asia

$/BBL 2006 1Q07 2Q07 3Q07 4Q07 2007 1Q08 Apr-08 May-08 Jun-08 2Q08 Jul-08Dubai 62 55 65 70 83 68 91 103 118 128 116 132Brent 65 59 69 75 89 73 97 109 123 133 122 134WTI 66 58 65 75 91 72 98 113 126 134 124 134S'pore GRM 5.5 6.8 9.5 6.3 7.7 7.6 7.0 10.1 7.5 6.7 8.1 4.6

Crude Price Analysis

Crude Price Outlooks

No more cheap crude Volatile marketsJul-Aug 08 crude price soften by:

Ending of high seasonsSubsidy cut in Asian countriesUS economic slowdown

21

Paradox: Gas oil spread record high VS FO record low

7384

105

129

98 101 105 110118

130140 136

7786

114

154

106 106 111

126138

157166 167

4858

73

91

72 72 72 7682

92 98111

406080

100120140160180

2006

2007

1Q08

2Q08

Dec

07

Jan0

8

Feb0

8

Mar

08

Apr

08

May

08

Jun0

8

Jul0

8

ULG 95 Gas Oil 0.5%S Fuel Oil 180cst

Unit = USD / BBL

Gas oil Price & Spread: Record High, driven by soaring crude prices and supply shortage due to plant shutdown coupled with growing demand in China plus extra demand for

Olympic GamesRestoration after disastrous earthquake

The dilemmaFuel Oil Price & Spread: Strong Price but deep dampen negative spreadShrink spread resulting from lower demand caused by:

High price Switching of Fuel Oil to gas oil in China effort to reduce pollution for Olympic Games

In the long run, refineries keep upgrading, fuel oil might come to scarcity, consequently, fuel oil price could be driven up

4

-13 -11

-18

-26

-13 -16 -18 -21 -21-26

-30

-21

1215 14 13 13 13 15 13 15 12 12

20

38

1815

17

23

2129

3539 38 35

-40

-20

0

20

40

2006

2007

1Q08

2Q08

Dec

07

Jan0

8

Feb0

8

Mar

08

Apr0

8

May

08

Jun0

8

Jul0

8

ULG 95 -Dubai Gas Oil - Dubai Fuel Oil - Dubai

Price & Spread Analysis

Source: Platt

22

Petrochemical: Price inflated from costs.

704

880

1,049

863 885 893941

1,0421,163 1,1741,160 1,179

1,240

13851,326 1,275 1,273

1,3981,485

1,618

1,572 1,548 1,576 1,593 1,596

584

1,120

1,764 1,780

1,2291,331

1,670 1,650

1,976

1732

1,2371,334

1,5081,475 1,513 1,536 1,556

1,665

2,058

500

700

900

1,100

1,300

1,500

1,700

1,900

2,100

2,300

2006 2007 1Q08 2Q08 Jan 08 Feb 08 Mar 08 Apr 08 May 08 Jun 08 Jul 08

Naphtha Ethylene Propylene HDPE PP

Unit = USD / Ton

576

475

360 337

463390

332

645 627692 700

655601 610

111181

215 210147

239 258212

177240

209

227 356 322 338

608691

621685

0

100

200

300

400

500

600

700

800


Ethylene - Naptha HDPE - Naptha PP - Propylene


Naphtha: marked its new high on 4 July 08 at 1,255 $/ ton following soaring crude price. This high cost brought down production volume of many olefins producers

Ethylene: price soaring but moderate spread, a sequel to high naphtha cost coupled with supply shortage as some olefins plants become uneconomical and shutdown.

Propylene: price soaring driven by tight supply due to production cutback and maintenance shutdown, also the start-up of a polypropylene plant in China take some propylene out of the markets.

Polymers: price soaring but moderate spread due to high monomer cost. New capacity expansion in 2H08 primarily from ME could put pressure on product spreads.

Source: ICIS

23

Styrenics: Weak demand

704

880

1,049

863 885 893 9411,042

1,163 1,1741,204

1,356 1,402

1549

1,358 1,401 1,4471,553

1,648 1,635

584

1,446

1,5311,700

1,7821952

1,764 1,773 1,810 1,821

2,126 2,183

1,908

1,794 1,820

1,277

1,459

1,639 1,6051,478

1,4571,477

1,500 1,519

1,866

1705

1,353

1,512 1,519 1,473 1,514 1,569 1,5831,665

1,868

500

700

900

1,100

1,300

1,500

1,700

1,900

2,100

2,300


Naphtha Styrene ABS PS EPS

327 344 380 402 406 372 374

103146 185

693755

598 591 594 592 607 578 563631 646

548

478

355364

72547673 9990 76 520

100

200

300

400

500

600

700

800


ABS - SM PS - SM PS - Naphtha

Unit: USD / Ton

Styrene Monomer: Bearish Weak demand Pressure from some players to liquidate supplies for cash.Operation rate has been reduced but the market is still sloppy.Supply from JCP expected to arrive in September 2008.

PS: SluggishWeak demand Threat of oversupply by the influx of JCP’s products

ABS: ModerateHigh ACN, Butadiene cost but producers could benefit from depressed SM market


Source: ICIS

24

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The information contained herein does not purport to be all-inclusive or to contain all of the Information that may be material to the recipient’s decision. Each recipient of the information and data contained herein should perform its own independent investigation and analysis of the transaction and the creditworthiness of IRPC . Reference in this Disclaimer to this shall include references to the Appendices (if any) hereto.

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2q08 performance - listed...

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