Reports to the Stock Exchange
Audited Financial Statements of IVL 2009 and MD&A
Ref.No.IVL009/02/2010
February 25, 2010
The President
The Stock Exchange of Thailand
Subject: Submission of Audited Financial Statements of Indorama Ventures
Public Company for the year ended December 31, 2009 and the Management's
Discussion and Analysis (MD&A)
We are pleased to submit:
1. A copy of Consolidated Audited Financial Statements for the year ended
December 31, 2009 (a copy in Thai and English)
2. Management's Discussion and Analysis (MD&A) for the year ended December 31,
2009 and quarter 4 of year 2009 (a copy in Thai and English)
3. Company's performance report, Form F45-3 (a copy in Thai and English)
Please be informed Form 45-3 shows earnings per share for year 2008 of Baht
16.51 per share is based on par value of Baht 10 per share and weighted issued
and paid-up capital. The earnings per share for year 2008 would have been Baht
0.79 per share based on par value of Baht 1 per share and issued and paid-up
capital at end of year. The par value was split from Baht 10 per share to Baht
1 per share in year 2009.
Please be informed accordingly.
Sincerely yours,
(Mr. Aloke Lohia)
Group Chief Executive Officer
Company Secretary
Tel: +66 (0) 2661-6661
Fax: +66 (0) 2661-6664
-1-
INDORAMA VENTURES PUBLIC COMPANY LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS (MD&A)
FOR THE PERIOD OF 4Q09 AND FY2009 (Consolidated)
IVL 2009 HIGHLIGHTS
- Record consolidated sales and earnings in year 2009:
- Net sales for year 2009 of Baht 79,994 million, a growth of 50%
- EBITDA for year 2009 of Baht 10,636 million, a growth of 177%
- Profit before tax of Baht 6,573 million, a growth of 107%
- *Net profit after tax and minority of Baht 5,346 million
(including minority interest for IRP considering on completion of
tender offer IVL shareholding has increased from 69.29% to
99.08% on February 3, 2010), a growth of 68%
- Benefit from integration with PTA which is a key raw material for PET
resins and Polyester fibers and yarns:
- Gross margin improved to 15.4% from 9.7%
- EBITDA margin improved to 13.3% from 7.2%
- Net profit margin improved to 7.5% from 5.9%
- Earnings per share of Baht 1.44 per share and return on equity of 30%
- Increase in free cash flow before capex and investments of Baht 7,404
million and free cash flow after capex of Baht 3,454 million
- Net debt reduced by Baht 3,152 million, resulting in net gearing ratio of
63% (before including IPO proceeds which have been received in Q1, 2010)
lower than 70% at the end of 2008
- Completed major capital expenditure:
- Greenfield PET resin plant of 432,000 tons per annum located in
Decatur, Alabama, USA. AlphaPet first line with capacity of
216,000 tpa started-up initial operations in October 2009
- Phased restart of commercial operations in year 2009 at Indorama
Polyester Industries (Rayong facility, Thailand) with a total
capacity of 252,000 tons per annum of which Polyester fibers and
yarns 144,000 tpa and PET resins 108,000 (converted a line to PET
resins which started in Q4, 2009)
Year 2009 reflects the full year results of operations of major acquisitions
completed in year 2008 within our product lines of PTA, PET resins and
Polyester fibers and yarns. Despite the recessionary conditions in year 2009,
our products saw positive growth in global demand reflecting of there
consumer staple nature. PET resins and Polyester fibers and yarns are
primarily used in daily necessity like food and beverage and clothing. The
management emphasized on lowering of costs through integration, increase
utilization rates to full capacity and take benefit of lower energy prices.
*Net profit after tax and minority as per audited financial statements for
year 2009 is Baht 4,824 million
-2-
IVL CONSOLIDATED PERFORMANCE
OPERATIONS
This section presents a summary of the key events observed in 2009 at each of
IVL's business groups.
PET business reported sales of Baht 44,456 million a growth of 9% over the
corresponding period. The increase in sales is from growth in sales volume by
32% to 1.02 million tons. Lower raw material prices led to lower selling
prices. The sales volume increase came from full year sales from European
assets acquired on March 31, 2008 and higher utilization rate of 101%. The PET
business represented 55.6% of consolidated sales and 53.5% of consolidated
EBITDA.
Polyester fibers and yarns & Wool yarns business reported sales of Baht 11,668
million, a growth of 87% over the corresponding period. The increase in sales
is primarily from 199% increase in sales volume in polyester fibers and yarns
business contributed from the restart of Indorama Polyester Rayong facility
which was restarted in phases for commercial operations in Q1, 2009 after
acquisition on September 30,2008. The Polyester fibers and Wool yarns business
represented 14.6% of consolidated sales and 12.7% of consolidated EBITDA.
PTA business reported merchant sales (excludes captive sales) for PTA of Baht
23,870 million, a growth of 318% over the corresponding period. The increase
in sales is from full year operations of all 3 PTA plants acquired in year
2008 and higher utilization rate of 100%. 48% of PTA sales was for captive use
to PET resins and polyester fibers and yarns business within the group. The
PTA business represented 29.8% of consolidated sales and 33.8% of consolidated
EBITDA.
CONSOLIDATED FINANCIAL RESULTS
IVL's consolidated sales were Baht 79,994 million in 2009, increasing 50% from
the previous year. These were driven by increases in sales volume of PET
resins, Polyester fibers and yarns and PTA. The sales increase was mainly
driven by full year operation of acquired business in year 2008 in Thailand
and Europe in PET resins, Polyester fibers and yarns and PTA. The acquired
plants were operating at full capacity by Q4, 2009.
EBITDA, as a result of higher sales and cost improvements, jumped to Baht
10,636 million in 2009 which was 177% higher than 2008. EBITDA margin also
improved significantly from 7.2% in 2008 to 13.3% in 2009. High EBITDA
generation in 2009 resulted in free cash flow after capex of Baht 3,454
million which was used in reduction of debt. The net debt in the year 2009
decrease by Baht 3,315 million after draw down of additional debt for
completion of AlphaPet project and for expansions and improvements in
Indorama Polyester Rayong Facility.
IVL posted profit before tax of Baht 6,573 million in 2009, increasing 107%
from the previous year, on the back of the strong sales and operating income
in the year. Tax expense was higher at Baht 554 million in the year 2009
compared to Baht 53 million in the previous year. The tax expense was 8.4% of
profit before tax and was primarily on the earnings of subsidiaries in USA and
Europe.
IVL posted net profit after minority interest of Baht 4,824 million,
increasing 82% from the previous year. In 2008, IVL recorded net profit after
minority interest of Baht 2,656 million. Minority interest increased from
Baht 467 million to Baht 1,195 million in year 2009 and the major components
are minority shareholders in Indorama Polymers Public Company Limited "IRP"
and TPT Petrochemicals Public Company Limited.
For comparison to future results, considering IVL has increased shareholding
in IRP from 69.29% to 99.08% on completion of share swap on February 3, 2010,
the IVL net profit after minority interest (except IRP) was Baht 5,346
million, an increase of 68% over 2008.
-3-
CAPITAL EXPENDITURES AND NET DEBT
Total capital expenditure of IVL in year 2009 of Baht 3,785 million which was
primarily in greenfield project for PET resins in AlphaPet for Baht 2,479
million and expansion and improvement projects in Indorama Polyester Rayong
facility for Baht 665 million. The total capital expenditures in 2009, Baht
3,478 million was for investment/ expansion and Baht 307 million was for
maintenance. The total capital expenditure in year 2008 was Baht 4,856 million
which Baht 3,466 million was in the greenfield project for PET resins in
AlphaPet Inc., USA. The total assets at the end of December 31, 2009 were Baht
74,260 million of which net fixed assets are Baht 49,505 million, equivalent
to 67% of total assets.
At the end of the year, IVL's total net debt stood at Baht 37,540 million, an
8% decrease from the previous year. The company repaid debt from its high
EBITDA generation and free cash flow after capex. Net gearing ratio went down
from 70% in 2008 to 63% at the end of the year. The net debt consists of:
Bank overdrafts and short term loans Baht 10,004 million
Current portion of long term loans Baht 4,692 million
Long term loans net of current portion Baht 25,404 million
TOTAL Baht 40,100 million
Less: Cash and cash equivalents Baht 2,560 million
Net debt Baht 37,540 million
-4-
IVL 4Q09 HIGHLIGHTS
- Higher consolidated sales and earnings in 4Q09:
- Net sales for 4Q09 of Baht 20,922 million, a growth of 2% over 3Q09
and 25% over 4Q08
- EBITDA for 4Q09 of Baht 2,610 million, a growth of 26% over 3Q09
and 668% over 4Q08
- Profit before tax for 4Q09 of Baht 1,709 million, a growth of 94%
over 3Q09 and loss in 4Q08
- Net profit after tax and minority interest for 4Q09 of Baht 1,380
million, a growth of 141% over 3Q09 and loss in 4Q08
- Benefit from integration with PTA which is a key raw material for PET
resins and Polyester fibers and yarns:
- Gross margin improved to 13.7% from 11.8% in 3Q09 and 3.6% in 4Q08
- EBITDA margin improved to 12.5% from 10.1% in 3Q09 and 2.0% in 4Q08
- Net profit before minority margin improved to 7.5% from 3.8% in
3Q09 and loss in 4Q08
- Annualized earnings per share of Baht 1.65 per share and return on equity
of 31.2% in 4Q09
PET business reported sales of Baht 11,614 million a growth of 6% over 3Q09.
The increase in sales is from growth in sales volume by 7%. AlphaPet
commenced commercial operations at its first line in October, 2009. The PET
business represented 55.5% of consolidated sales and 44.6% of consolidated
EBITDA.
Polyester fibers and yarns & Wool yarns business reported sales of Baht 3,622
million, a growth of 14% over 3Q09. The increase in sales is primarily from
13% increase in sales volume in polyester fibers and yarns business on
increase in utilization rate due to better plant utilization and
implementation of switch of utilities from fuel oil to natural gas at
Indorama Polyester Rayong Facility. Also, the sales volume in wool business
increased by 27%. The earnings and margins improved in 4Q09 for polyester
fibers and yarns and wool business. The Polyester fibers and yarns and wool
yarns business represented 17.3% of consolidated sales and 19.4% of
consolidated EBITDA.
PTA business reported merchant sales (excludes captive sales) for PTA of Baht
5,685 million, lower by 9% over 3Q09. The merchant sales reduced on higher
captive sales resulting in integration ratio increasing from 48% to 52%. The
PTA business represented 27.2% of consolidated sales and 36.0% of consolidated
EBITDA.
-5-
FINANCIAL INFORMATION
- IVL consolidated tables
- Business segment tables
- IVL consolidated balance sheet and statement of income
-6-
IVL CONSOLIDATED
Table 1
IVL : REVENUES
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Total revenues
Baht in millions 20,922 20,422 16,738 2% 25% 79,994 53,332 50%
USD in millions 628 602 481 4% 31% 2,331 1,600 46%
Proportion of revenues by geographic
Thailand 16% 17% 14% 15% 11%
Asia 24% 21% 19% 24% 11%
(excluding Thailand)
North America 14% 13% 20% 16% 24%
Europe 37% 39% 41% 38% 48%
Rest of the World 9% 10% 7% 8% 7%
Table 2
IVL : KEY FINANCIAL PERFORMANCE AND MARGINS
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
EBITDA
Baht in millions 2,610 2,067 340 26% 668% 10,636 3,838 177%
USD in millions 78 61 10 29% 702% 310 115 169%
Margin (%) 12.5% 10.1% 2.0% 13.3% 7.2%
Profit (loss) before tax
Baht in millions 1,709 881 (1,462) 94% n/a 6,573 3,176 107%
USD in millions 51 26 (42) 97% n/a 192 95 101%
Margin (%) 8.2% 4.3% -8.7% 8.2% 6.0%
Net profit (loss) after tax and minority
Baht in millions 1,380 573 (1,179) 141% n/a *5,346 *3,182 68%
USD in millions 41 17 (34) 145% n/a 156 95 64%
Margin (%) 6.6% 2.8% -7.0% 6.0% 5.0%
*including minority interest for IRP considering on completion of tender offer
IVL shareholding has increased from 69.29% to 99.08% on February 3, 2010
Table 3
IVL : CASH FLOW
FY09 vs.
Baht in millions FY09 FY08 FY08
EBITDA 10,636 3,838 177%
Net working capital and others (1,084) (1,290) -16%
Net financial expenses (1,884) (1,302) 45%
Income tax (264) (28) 843%
Free cash flow before Capex 7,404 1,218 508%
Capital expenditures (3,785) (4,856) -22%
Net (acquisitions) disposals of subsidiaries
(165) (14,194) -99%
Free cash flow after Capex 3,454 (17,832) n/a
Dividends (182) (136) 34%
Proceeds from issues of shares 0 4,025 -100%
Changes in net debt (3,272) 13,943 n/a
Note: The consolidated financials are based upon elimination of intra-company
(or intra business segment) transactions reason which the total of each
segment may not tally with consolidated financials.
-7-
Table 4
IVL : FINANCIAL RATIOS
4Q09 3Q09 4Q08 FY09 FY08
Current ratio (times) 0.9 0.9 0.8 0.9 0.8
Net gearing ratio (%) 63% 63% 70% 63% 70%
*Net operating gearing ratio 61% 60% 67% 60% 67%
Interest coverage ratio (times)7.4 5.6 0.5 6.7 2.7
** ROE (%) 31.2% 15.7% -47.9% 30.0% 26.0%
*** ROCE (%) 12.8% 8.8% -4.0% 13.8% 6.7%
*Based on net operating debt which is net debt less debt for capex and
investments not generating revenue and earnings
** Profit before minority to average total shareholder's equity
*** Operating income to average capital employed (net operating debt plus
total shareholder's equity)
-8-
PET
Table 5
PET : CAPACITY AND UTILISATION (%)
4Q09 vs. FY09
vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Production capacity 293,500 239,500 239,500 23% 23% 1,012,000 869,250 16%
(in Tonnes)
Production volumes 280,011 248,946 216,778 12% 29% 1,026,582 804,190 28%
(in Tonnes)
Utilisation rate (%) 95% 104% 91% 101% 93%
Table 6
PET : REVENUES
4Q09 vs. FY09
vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Total revenues
Baht in millions 11,614 10,989 10,053 6% 16% 44,456 40,969 9%
USD in millions 349 324 289 8% 21% 1,295 1,229 5%
Growth in Baht revenues from:
Volume movement 7% 18% 32%
Price movement -1% -2% -18%
Proportion of revenues by geographic
Thailand 7% 7% 6% 6% 6%
Asia 4% 3% 3% 3% 3%
(excluding Thailand)
North America 24% 23% 30% 27% 30%
Europe 57% 61% 54% 58% 54%
Rest of the World 8% 6% 9% 6% 8%
Table 7
PET : OPERATING EBITDA AND MARGIN
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
*Operating EBITDA
Baht in millions 1,164 1,119 330 4% 253% 5,687 2,873 98%
USD in millions 35 33 9 6% 269% 166 86 92%
Margin (%) 10.0% 10.2% 3.3% 12.8% 7.0%
*Based on pro-rata allocation of earnings of PTA business calculated on
intra-group sales to PET and Polyester fibers
-9-
POLYESTER & WOOL
Table 8
POLYESTER & WOOL : CAPACITY AND UTILISATION (%)
POLYESTER FIBERS & YARNS
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Production capacity 88,330 88,330 25,040 0% 219% 333,080 100,000 233%
(in Tonnes)
* Production volumes89,127 83,319 24,982 7% 257% 318,582 109,651 191%
(in Tonnes)
Utilisation rate (%) 101% 94% 100% 96% 110%
WOOL YARNS
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Production capacity 1,475 1,475 1,475 0% 0% 5,900 5,900 0%
(in Tonnes)
* Production volumes 824 709 716 16% 15% 3,062 4,136 -26%
(in Tonnes)
Utilisation rate (%) 56% 48% 49% 52% 70%
* volumes based on equivalent production
Table 9
POLYESTER & WOOL : REVENUES
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Total revenues
Baht in millions 3,622 3,179 1,155 14% 214% 11,668 6,243 87%
USD in millions 109 94 33 16% 228% 340 187 82%
Growth in Baht revenues from:
Volume movement 13% 320% 193%
Price movement 9% -33% -37%
Proportion of revenues by geographic
Thailand 24% 20% 37% 22% 37%
Asia 36% 45% 36% 45% 32%
(excluding Thailand)
North America 4% 5% 6% 5% 3%
Europe 22% 13% 19% 14% 25%
Rest of the World 15% 17% 3% 14% 3%
Table 10
POLYESTER & WOOL : OPERATING EBITDA AND MARGIN
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Operating EBITDA
Baht in millions 507 268 63 89% 704% 1,353 593 128%
USD in millions 15 8 2 92% 740% 39 18 121%
Margin (%) 14.0% 8.4% 5.5% 11.6% 9.5%
*Based on pro-rata allocation of earnings of PTA business calculated on
intra-group sales to PET and Polyester fibers
- 10 -
PTA
Table 11
PTA : CAPACITY AND UTILISATION (%)
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Production capacity 397,500 397,500 397,500 0% 0% 1,590,000 572,500 178%
(in Tonnes)
Production volumes 390,138 400,654 385,998 -3% 1% 1,584,683 534,260 197%
(in Tonnes)
Utilisation 98% 101% 97% 100% 93%
rate (%)
Table 12
PTA : REVENUES
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Total revenues
Baht in millions11,804 12,126 8,732 -3% 35% 45,981 14,732 212%
USD in millions 354 358 251 -1% 41% 1,340 442 203%
Growth in Baht revenues from:
Volume movement -4% 0% 197%
Price movement 1% 35% 5%
Sales to PET business
Baht in millions 4,010 4,079 2,825 -2% 42% 15,418 8,645 78%
USD in millions 120 120 81 0% 48% 449 259 73%
Sales to Polyester business
Baht in millions 2,109 1,799 377 17% 459% 6,693 377 1675%
(more)
February 25, 2010
The President
The Stock Exchange of Thailand
Subject: Submission of Audited Financial Statements of Indorama Ventures
Public Company for the year ended December 31, 2009 and the Management's
Discussion and Analysis (MD&A)
We are pleased to submit:
1. A copy of Consolidated Audited Financial Statements for the year ended
December 31, 2009 (a copy in Thai and English)
2. Management's Discussion and Analysis (MD&A) for the year ended December 31,
2009 and quarter 4 of year 2009 (a copy in Thai and English)
3. Company's performance report, Form F45-3 (a copy in Thai and English)
Please be informed Form 45-3 shows earnings per share for year 2008 of Baht
16.51 per share is based on par value of Baht 10 per share and weighted issued
and paid-up capital. The earnings per share for year 2008 would have been Baht
0.79 per share based on par value of Baht 1 per share and issued and paid-up
capital at end of year. The par value was split from Baht 10 per share to Baht
1 per share in year 2009.
Please be informed accordingly.
Sincerely yours,
(Mr. Aloke Lohia)
Group Chief Executive Officer
Company Secretary
Tel: +66 (0) 2661-6661
Fax: +66 (0) 2661-6664
-1-
INDORAMA VENTURES PUBLIC COMPANY LIMITED
MANAGEMENT'S DISCUSSION AND ANALYSIS (MD&A)
FOR THE PERIOD OF 4Q09 AND FY2009 (Consolidated)
IVL 2009 HIGHLIGHTS
- Record consolidated sales and earnings in year 2009:
- Net sales for year 2009 of Baht 79,994 million, a growth of 50%
- EBITDA for year 2009 of Baht 10,636 million, a growth of 177%
- Profit before tax of Baht 6,573 million, a growth of 107%
- *Net profit after tax and minority of Baht 5,346 million
(including minority interest for IRP considering on completion of
tender offer IVL shareholding has increased from 69.29% to
99.08% on February 3, 2010), a growth of 68%
- Benefit from integration with PTA which is a key raw material for PET
resins and Polyester fibers and yarns:
- Gross margin improved to 15.4% from 9.7%
- EBITDA margin improved to 13.3% from 7.2%
- Net profit margin improved to 7.5% from 5.9%
- Earnings per share of Baht 1.44 per share and return on equity of 30%
- Increase in free cash flow before capex and investments of Baht 7,404
million and free cash flow after capex of Baht 3,454 million
- Net debt reduced by Baht 3,152 million, resulting in net gearing ratio of
63% (before including IPO proceeds which have been received in Q1, 2010)
lower than 70% at the end of 2008
- Completed major capital expenditure:
- Greenfield PET resin plant of 432,000 tons per annum located in
Decatur, Alabama, USA. AlphaPet first line with capacity of
216,000 tpa started-up initial operations in October 2009
- Phased restart of commercial operations in year 2009 at Indorama
Polyester Industries (Rayong facility, Thailand) with a total
capacity of 252,000 tons per annum of which Polyester fibers and
yarns 144,000 tpa and PET resins 108,000 (converted a line to PET
resins which started in Q4, 2009)
Year 2009 reflects the full year results of operations of major acquisitions
completed in year 2008 within our product lines of PTA, PET resins and
Polyester fibers and yarns. Despite the recessionary conditions in year 2009,
our products saw positive growth in global demand reflecting of there
consumer staple nature. PET resins and Polyester fibers and yarns are
primarily used in daily necessity like food and beverage and clothing. The
management emphasized on lowering of costs through integration, increase
utilization rates to full capacity and take benefit of lower energy prices.
*Net profit after tax and minority as per audited financial statements for
year 2009 is Baht 4,824 million
-2-
IVL CONSOLIDATED PERFORMANCE
OPERATIONS
This section presents a summary of the key events observed in 2009 at each of
IVL's business groups.
PET business reported sales of Baht 44,456 million a growth of 9% over the
corresponding period. The increase in sales is from growth in sales volume by
32% to 1.02 million tons. Lower raw material prices led to lower selling
prices. The sales volume increase came from full year sales from European
assets acquired on March 31, 2008 and higher utilization rate of 101%. The PET
business represented 55.6% of consolidated sales and 53.5% of consolidated
EBITDA.
Polyester fibers and yarns & Wool yarns business reported sales of Baht 11,668
million, a growth of 87% over the corresponding period. The increase in sales
is primarily from 199% increase in sales volume in polyester fibers and yarns
business contributed from the restart of Indorama Polyester Rayong facility
which was restarted in phases for commercial operations in Q1, 2009 after
acquisition on September 30,2008. The Polyester fibers and Wool yarns business
represented 14.6% of consolidated sales and 12.7% of consolidated EBITDA.
PTA business reported merchant sales (excludes captive sales) for PTA of Baht
23,870 million, a growth of 318% over the corresponding period. The increase
in sales is from full year operations of all 3 PTA plants acquired in year
2008 and higher utilization rate of 100%. 48% of PTA sales was for captive use
to PET resins and polyester fibers and yarns business within the group. The
PTA business represented 29.8% of consolidated sales and 33.8% of consolidated
EBITDA.
CONSOLIDATED FINANCIAL RESULTS
IVL's consolidated sales were Baht 79,994 million in 2009, increasing 50% from
the previous year. These were driven by increases in sales volume of PET
resins, Polyester fibers and yarns and PTA. The sales increase was mainly
driven by full year operation of acquired business in year 2008 in Thailand
and Europe in PET resins, Polyester fibers and yarns and PTA. The acquired
plants were operating at full capacity by Q4, 2009.
EBITDA, as a result of higher sales and cost improvements, jumped to Baht
10,636 million in 2009 which was 177% higher than 2008. EBITDA margin also
improved significantly from 7.2% in 2008 to 13.3% in 2009. High EBITDA
generation in 2009 resulted in free cash flow after capex of Baht 3,454
million which was used in reduction of debt. The net debt in the year 2009
decrease by Baht 3,315 million after draw down of additional debt for
completion of AlphaPet project and for expansions and improvements in
Indorama Polyester Rayong Facility.
IVL posted profit before tax of Baht 6,573 million in 2009, increasing 107%
from the previous year, on the back of the strong sales and operating income
in the year. Tax expense was higher at Baht 554 million in the year 2009
compared to Baht 53 million in the previous year. The tax expense was 8.4% of
profit before tax and was primarily on the earnings of subsidiaries in USA and
Europe.
IVL posted net profit after minority interest of Baht 4,824 million,
increasing 82% from the previous year. In 2008, IVL recorded net profit after
minority interest of Baht 2,656 million. Minority interest increased from
Baht 467 million to Baht 1,195 million in year 2009 and the major components
are minority shareholders in Indorama Polymers Public Company Limited "IRP"
and TPT Petrochemicals Public Company Limited.
For comparison to future results, considering IVL has increased shareholding
in IRP from 69.29% to 99.08% on completion of share swap on February 3, 2010,
the IVL net profit after minority interest (except IRP) was Baht 5,346
million, an increase of 68% over 2008.
-3-
CAPITAL EXPENDITURES AND NET DEBT
Total capital expenditure of IVL in year 2009 of Baht 3,785 million which was
primarily in greenfield project for PET resins in AlphaPet for Baht 2,479
million and expansion and improvement projects in Indorama Polyester Rayong
facility for Baht 665 million. The total capital expenditures in 2009, Baht
3,478 million was for investment/ expansion and Baht 307 million was for
maintenance. The total capital expenditure in year 2008 was Baht 4,856 million
which Baht 3,466 million was in the greenfield project for PET resins in
AlphaPet Inc., USA. The total assets at the end of December 31, 2009 were Baht
74,260 million of which net fixed assets are Baht 49,505 million, equivalent
to 67% of total assets.
At the end of the year, IVL's total net debt stood at Baht 37,540 million, an
8% decrease from the previous year. The company repaid debt from its high
EBITDA generation and free cash flow after capex. Net gearing ratio went down
from 70% in 2008 to 63% at the end of the year. The net debt consists of:
Bank overdrafts and short term loans Baht 10,004 million
Current portion of long term loans Baht 4,692 million
Long term loans net of current portion Baht 25,404 million
TOTAL Baht 40,100 million
Less: Cash and cash equivalents Baht 2,560 million
Net debt Baht 37,540 million
-4-
IVL 4Q09 HIGHLIGHTS
- Higher consolidated sales and earnings in 4Q09:
- Net sales for 4Q09 of Baht 20,922 million, a growth of 2% over 3Q09
and 25% over 4Q08
- EBITDA for 4Q09 of Baht 2,610 million, a growth of 26% over 3Q09
and 668% over 4Q08
- Profit before tax for 4Q09 of Baht 1,709 million, a growth of 94%
over 3Q09 and loss in 4Q08
- Net profit after tax and minority interest for 4Q09 of Baht 1,380
million, a growth of 141% over 3Q09 and loss in 4Q08
- Benefit from integration with PTA which is a key raw material for PET
resins and Polyester fibers and yarns:
- Gross margin improved to 13.7% from 11.8% in 3Q09 and 3.6% in 4Q08
- EBITDA margin improved to 12.5% from 10.1% in 3Q09 and 2.0% in 4Q08
- Net profit before minority margin improved to 7.5% from 3.8% in
3Q09 and loss in 4Q08
- Annualized earnings per share of Baht 1.65 per share and return on equity
of 31.2% in 4Q09
PET business reported sales of Baht 11,614 million a growth of 6% over 3Q09.
The increase in sales is from growth in sales volume by 7%. AlphaPet
commenced commercial operations at its first line in October, 2009. The PET
business represented 55.5% of consolidated sales and 44.6% of consolidated
EBITDA.
Polyester fibers and yarns & Wool yarns business reported sales of Baht 3,622
million, a growth of 14% over 3Q09. The increase in sales is primarily from
13% increase in sales volume in polyester fibers and yarns business on
increase in utilization rate due to better plant utilization and
implementation of switch of utilities from fuel oil to natural gas at
Indorama Polyester Rayong Facility. Also, the sales volume in wool business
increased by 27%. The earnings and margins improved in 4Q09 for polyester
fibers and yarns and wool business. The Polyester fibers and yarns and wool
yarns business represented 17.3% of consolidated sales and 19.4% of
consolidated EBITDA.
PTA business reported merchant sales (excludes captive sales) for PTA of Baht
5,685 million, lower by 9% over 3Q09. The merchant sales reduced on higher
captive sales resulting in integration ratio increasing from 48% to 52%. The
PTA business represented 27.2% of consolidated sales and 36.0% of consolidated
EBITDA.
-5-
FINANCIAL INFORMATION
- IVL consolidated tables
- Business segment tables
- IVL consolidated balance sheet and statement of income
-6-
IVL CONSOLIDATED
Table 1
IVL : REVENUES
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Total revenues
Baht in millions 20,922 20,422 16,738 2% 25% 79,994 53,332 50%
USD in millions 628 602 481 4% 31% 2,331 1,600 46%
Proportion of revenues by geographic
Thailand 16% 17% 14% 15% 11%
Asia 24% 21% 19% 24% 11%
(excluding Thailand)
North America 14% 13% 20% 16% 24%
Europe 37% 39% 41% 38% 48%
Rest of the World 9% 10% 7% 8% 7%
Table 2
IVL : KEY FINANCIAL PERFORMANCE AND MARGINS
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
EBITDA
Baht in millions 2,610 2,067 340 26% 668% 10,636 3,838 177%
USD in millions 78 61 10 29% 702% 310 115 169%
Margin (%) 12.5% 10.1% 2.0% 13.3% 7.2%
Profit (loss) before tax
Baht in millions 1,709 881 (1,462) 94% n/a 6,573 3,176 107%
USD in millions 51 26 (42) 97% n/a 192 95 101%
Margin (%) 8.2% 4.3% -8.7% 8.2% 6.0%
Net profit (loss) after tax and minority
Baht in millions 1,380 573 (1,179) 141% n/a *5,346 *3,182 68%
USD in millions 41 17 (34) 145% n/a 156 95 64%
Margin (%) 6.6% 2.8% -7.0% 6.0% 5.0%
*including minority interest for IRP considering on completion of tender offer
IVL shareholding has increased from 69.29% to 99.08% on February 3, 2010
Table 3
IVL : CASH FLOW
FY09 vs.
Baht in millions FY09 FY08 FY08
EBITDA 10,636 3,838 177%
Net working capital and others (1,084) (1,290) -16%
Net financial expenses (1,884) (1,302) 45%
Income tax (264) (28) 843%
Free cash flow before Capex 7,404 1,218 508%
Capital expenditures (3,785) (4,856) -22%
Net (acquisitions) disposals of subsidiaries
(165) (14,194) -99%
Free cash flow after Capex 3,454 (17,832) n/a
Dividends (182) (136) 34%
Proceeds from issues of shares 0 4,025 -100%
Changes in net debt (3,272) 13,943 n/a
Note: The consolidated financials are based upon elimination of intra-company
(or intra business segment) transactions reason which the total of each
segment may not tally with consolidated financials.
-7-
Table 4
IVL : FINANCIAL RATIOS
4Q09 3Q09 4Q08 FY09 FY08
Current ratio (times) 0.9 0.9 0.8 0.9 0.8
Net gearing ratio (%) 63% 63% 70% 63% 70%
*Net operating gearing ratio 61% 60% 67% 60% 67%
Interest coverage ratio (times)7.4 5.6 0.5 6.7 2.7
** ROE (%) 31.2% 15.7% -47.9% 30.0% 26.0%
*** ROCE (%) 12.8% 8.8% -4.0% 13.8% 6.7%
*Based on net operating debt which is net debt less debt for capex and
investments not generating revenue and earnings
** Profit before minority to average total shareholder's equity
*** Operating income to average capital employed (net operating debt plus
total shareholder's equity)
-8-
PET
Table 5
PET : CAPACITY AND UTILISATION (%)
4Q09 vs. FY09
vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Production capacity 293,500 239,500 239,500 23% 23% 1,012,000 869,250 16%
(in Tonnes)
Production volumes 280,011 248,946 216,778 12% 29% 1,026,582 804,190 28%
(in Tonnes)
Utilisation rate (%) 95% 104% 91% 101% 93%
Table 6
PET : REVENUES
4Q09 vs. FY09
vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Total revenues
Baht in millions 11,614 10,989 10,053 6% 16% 44,456 40,969 9%
USD in millions 349 324 289 8% 21% 1,295 1,229 5%
Growth in Baht revenues from:
Volume movement 7% 18% 32%
Price movement -1% -2% -18%
Proportion of revenues by geographic
Thailand 7% 7% 6% 6% 6%
Asia 4% 3% 3% 3% 3%
(excluding Thailand)
North America 24% 23% 30% 27% 30%
Europe 57% 61% 54% 58% 54%
Rest of the World 8% 6% 9% 6% 8%
Table 7
PET : OPERATING EBITDA AND MARGIN
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
*Operating EBITDA
Baht in millions 1,164 1,119 330 4% 253% 5,687 2,873 98%
USD in millions 35 33 9 6% 269% 166 86 92%
Margin (%) 10.0% 10.2% 3.3% 12.8% 7.0%
*Based on pro-rata allocation of earnings of PTA business calculated on
intra-group sales to PET and Polyester fibers
-9-
POLYESTER & WOOL
Table 8
POLYESTER & WOOL : CAPACITY AND UTILISATION (%)
POLYESTER FIBERS & YARNS
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Production capacity 88,330 88,330 25,040 0% 219% 333,080 100,000 233%
(in Tonnes)
* Production volumes89,127 83,319 24,982 7% 257% 318,582 109,651 191%
(in Tonnes)
Utilisation rate (%) 101% 94% 100% 96% 110%
WOOL YARNS
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Production capacity 1,475 1,475 1,475 0% 0% 5,900 5,900 0%
(in Tonnes)
* Production volumes 824 709 716 16% 15% 3,062 4,136 -26%
(in Tonnes)
Utilisation rate (%) 56% 48% 49% 52% 70%
* volumes based on equivalent production
Table 9
POLYESTER & WOOL : REVENUES
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Total revenues
Baht in millions 3,622 3,179 1,155 14% 214% 11,668 6,243 87%
USD in millions 109 94 33 16% 228% 340 187 82%
Growth in Baht revenues from:
Volume movement 13% 320% 193%
Price movement 9% -33% -37%
Proportion of revenues by geographic
Thailand 24% 20% 37% 22% 37%
Asia 36% 45% 36% 45% 32%
(excluding Thailand)
North America 4% 5% 6% 5% 3%
Europe 22% 13% 19% 14% 25%
Rest of the World 15% 17% 3% 14% 3%
Table 10
POLYESTER & WOOL : OPERATING EBITDA AND MARGIN
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Operating EBITDA
Baht in millions 507 268 63 89% 704% 1,353 593 128%
USD in millions 15 8 2 92% 740% 39 18 121%
Margin (%) 14.0% 8.4% 5.5% 11.6% 9.5%
*Based on pro-rata allocation of earnings of PTA business calculated on
intra-group sales to PET and Polyester fibers
- 10 -
PTA
Table 11
PTA : CAPACITY AND UTILISATION (%)
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Production capacity 397,500 397,500 397,500 0% 0% 1,590,000 572,500 178%
(in Tonnes)
Production volumes 390,138 400,654 385,998 -3% 1% 1,584,683 534,260 197%
(in Tonnes)
Utilisation 98% 101% 97% 100% 93%
rate (%)
Table 12
PTA : REVENUES
4Q09 vs. FY09 vs.
4Q09 3Q09 4Q08 3Q09 4Q08 FY09 FY08 FY08
Total revenues
Baht in millions11,804 12,126 8,732 -3% 35% 45,981 14,732 212%
USD in millions 354 358 251 -1% 41% 1,340 442 203%
Growth in Baht revenues from:
Volume movement -4% 0% 197%
Price movement 1% 35% 5%
Sales to PET business
Baht in millions 4,010 4,079 2,825 -2% 42% 15,418 8,645 78%
USD in millions 120 120 81 0% 48% 449 259 73%
Sales to Polyester business
Baht in millions 2,109 1,799 377 17% 459% 6,693 377 1675%
(more)