Bangchak Corporation - Global Alliance Partners
Bangchak Corporation Buy (17E TP Bt41.00)
Company Update
Close Bt32.75
Energy & Utilities April 26, 2017
Earnings upgrade / Earnings downgrade / Overview unchanged
Expect soaring earnings in 1Q17E Price Performance (%)
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
3.872
4.145
KT ZMICO vs. consensus Share data
1.0%
1.3%
Reuters / Bloomberg
BCP.BK/BCP TB
Paid‐up Shares (m)
1,376.92
Par (Bt)
1.00
Market cap (Bt bn / US$ m)
45.00/1,311.00
Foreign limit / actual (%)
25.00/15.78
52 week High / Low (Bt)
37.00/28.25
Avg. daily T/O (shares 000)
5,630.00
NVDR (%)
8.00
Estimated free float (%)
59.8
Beta
0.94
URL
www.bangchak.co.th
CGR Anti‐corruption
Level 4 (Certified)
Note: An executive of KT ZMICO Securities is also a member of BCP’s board.
Patcharin Karsemarnuntana Analyst, no 17834 [email protected] 66 (0) 2695‐5837
Growth story intact Given the company’s marketing business making a back‐to‐normal contribution in 1Q17E to help relieve the market’s concern, the good mix of diversified earnings continuing, as well as the growth stories of BCPG (underway, with a new MW addition towards 2018E) and its 3E project (to be fully complete in 2020E), we maintain a Buy rating on BCP. Expect soaring NP at Bt1.75bn in 1Q17E We expect BCP to deliver soaring earnings in 1Q17E with projected NP of Bt1.75bn (+36.5 times YoY, +54.5% QoQ) and core profit of Bt1.44bn, reversing from a normalized loss in 1Q16 (due to the 46‐day planned shutdown and a substantial stock loss in the quarter) and increasing 24% QoQ with operational improvement seen (EBITDA level) in all major businesses. Stronger EBITDA contribution in 1Q17E, particularly in the case of marketing business QoQ and refinery business YoY We expect a stronger EBITDA contribution in 1Q17E, particularly in the case of the marketing business on a QoQ basis, whose EBITDA contribution should be back to the normal level in 1Q17E (~mid‐ Bt600mn) following stronger sales volume to 1,540mn litres and a rebound of the marketing margin to Bt0.76/litre (vs. a negative EBITDA contribution of Bt3bn in 4Q16, with the unadjusted retail price causing a low margin of Bt0.56/litre, as well as high advertising expenses and the set up expenses of SPAR supermarket). Meanwhile, its refinery is expected to make a stronger EBITDA contribution in 1Q17E, especially YoY given the sustained high crude run at 110kbd (vs. 64kbd in 1Q16 from a planned shutdown) and projected accounting GRM of US$7.6/bbl in the quarter given the higher market GRM driven by competitive Brent‐linked crude and slim stock gain (vs. ‐US$0.24/bbl in 1Q16 and US$8.73/bbl in 4Q16). At the same time, a solid EBITDA contribution is expected at its solar business in 1Q17E, with higher power generation at both solar Thailand (with the first full‐quarter contribution from the solar co‐op totaling 12MW) and solar Japan (with the kickoff of the new project with the 10.5MW PPA in Mar‐2017). Keep 2017E earnings estimate unchanged We are comfortable with our 2017E forecasts calling for Bt13bn EBITDA and Bt5.3bn core profit (with the 1Q17E figures accounting for 26% and 27%, respectively), with no refinery shutdown and higher profit from BCPG following the ramp up of the contribution from solar Japan as the major drivers. Financials and Valuation FY Ended 31 Dec Revenues (Btmn) Net profit (Btmn) EPS (Bt) EPS growth (%) Dividend (Bt) BV (Bt) FY Ended 31 Dec PER (x) EV/EBITDA (x) PBV (x) Dividend yield (%) ROE (%) Net gearing (%)
2015 151,140 4,151 3.01 495.55 2.00 25.77 2015 10.88 6.04 1.27 6.1% 12.1% 60.1%
2016 144,705 4,773 3.47 15.28 1.80 28.72 2016 9.44 6.10 1.14 5.5% 12.7% 47.1%
2017E 163,996 5,378 3.91 12.56 1.95 30.67 2017E 8.39 6.20 1.07 6.0% 13.2% 85.2%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 5
2018E 152,754 5,785 4.20 7.58 2.10 32.77 2018E 7.79 5.72 1.00 6.4% 13.2% 82.9%
2019E 167,643 6,333 4.60 9.47 2.30 35.07 2019E 7.12 5.15 0.93 7.0% 13.6% 69.7%
Figure 1: BCP’s 1Q17E earnings preview Profit and Loss (Btmn) Year-end 31 Dec Revenue Gross profit EBITDA Interest expense Other income Income tax Forex gain (loss) Other extraordinary Items Gn (Ls) from affiliates Minority interests Net profit (loss) Core profit (loss) Reported EPS (Bt) Gross margin (%) EBITDA margin (%) Net margin (%) Current ratio (x) Interest coverage (x) Interest-bearing debt / equity (x) BVPS (Bt) ROE (%)
1Q16 30,276 949 835 (373) 289 167 141 2 13 72 47 (96) 0.03 3.1 2.8 0.2 2.8 (0.7) 0.9 25.8 0.5
4Q16 40,481 3,759 2,966 (415) 111 (164) (285) 258 16 (77) 1,131 1,159 0.83 9.3 7.3 2.8 1.7 4.1 1.0 28.7 11.4
1Q17E 40,855 3,666 3,452 (418) 105 (309) 311 10 (84) 1,748 1,437 1.27 9.0 8.4 4.3 1.8 5.1 0.7 30.0 16.9
Source: KT Zmico Research Note: *including stock gain (loss) impact as the recurring item
% YoY 34.9 286.5 313.4 12.2 (63.7) nm 121.3 (100.0) (20.3) nm 3,650.9 nm 4,131.1
% QoQ 0.9 (2.5) 16.4 0.7 (5.2) 89.1 nm (100.0) (35.6) 9.1 54.5 24.0 53.1
2016 144,705 11,896 10,442 (1,484) 634 (689) 276 263 21 44 4,773 4,234 3.47 8.2 7.2 3.3 1.7 3.8 1.0 28.7 12.7
2017E 163,996 14,046 13,070 (1,549) 235 (916) 60 35 (661) 5,378 5,318 3.91 8.6 8.0 3.3 1.9 5.3 0.9 30.7 13.2
% YoY 13.3 18.1 25.2 4.4 (63.0) 32.9 (78.3) (100.0) 66.9 nm 12.7 25.6 12.6
Figure 2: BCP’s quarterly data A) BCP’s quarterly crude run
B) BCP’s quarterly accounting GRM
Source: KT Zmico Research REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 5
YTD (% of 17E) 25% 26% 26% 27% 45% 34% 518% nm 29% 13% 33% 27% 32%
Figure 3: BCP’s PBV band
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 5
Financial tables PROFIT & LOSS (Btm) Revenues Cost of sales and service Gross profit SG&A EBITDA Depreciation & amortization EBIT Interest expense Other income / exp. EBT Corporate tax Forex gain (loss) Extra Items Gain (loss) from affiliates Minority interests Net profit Reported EPS Fully diluted EPS Core net profit Core EPS Dividend (Bt) BALANCE SHEET (Btm) Cash and equivalents Accounts receivable Inventories PP&E‐net Other assets Total assets ST debt & current portion Long‐term debt Total liabilities Paid‐up shares Shareholder equity Minority interests Total liab. & shareholder equity CASH FLOW (Btm) Net income Forex and other extraordinary adjustments Depreciation & amortization Change in working capital Cash flow from operations Capex (Invest)/Divest Others Cash flow from investing Debt financing (repayment) Equity financing Dividend payment Others Cash flow from financing Net change in cash Free cash flow FCF per share (Bt) PROFITABILITY Revenue growth (%) EBITDA growth (%) EPS growth (%) Gross margin (%) EBITDA margin (%) Operating margin (%) Net margin (%) Core profit margin (%) Effective tax rate (%)
2014 183,016 (178,473) 4,543 (4,480) 3,377 3,313 63 (1,427) 932 (431) 691 758 (393) 5 67 696 0.51 0.51 331 0.24 1.00
2015 151,140 (139,686) 11,454 (5,175) 10,987 4,708 6,279 (1,615) 61 4,725 (673) 22 11 12 53 4,151 3.01 3.01 4,118 2.99 2.00
2016 144,705 (132,809) 11,896 (6,189) 10,442 4,734 5,707 (1,484) 634 4,858 (689) 276 263 21 44 4,773 3.47 3.37 4,234 3.07 1.80
2017E 163,996 (149,950) 14,046 (5,872) 13,070 4,896 8,173 (1,549) 235 6,859 (916) 60 0 35 (661) 5,378 3.91 3.91 5,318 3.86 1.95
2018E 152,754 (138,414) 14,341 (5,481) 14,429 5,569 8,860 (1,546) 260 7,574 (1,047) 0 0 35 (777) 5,785 4.20 4.20 5,785 4.20 2.10
2019E 167,643 (152,253) 15,389 (6,003) 15,283 5,897 9,386 (1,347) 260 8,300 (1,173) 0 0 35 (829) 6,333 4.60 4.60 6,333 4.60 2.30
2014 8,577 7,095 14,059 39,532 7,703 76,966 1,312 28,913 43,000 1,377 33,309 657 76,966
2015 12,390 5,977 13,945 41,687 7,943 81,942 1,026 32,675 45,959 1,377 35,481 502 81,942
2016 21,006 7,213 14,560 48,401 10,603 101,783 11,141 28,483 57,874 1,377 39,543 4,366 101,783
2017E 3,902 8,087 16,433 61,978 11,601 102,002 4,572 35,308 54,744 1,377 42,232 5,027 102,002
2018E 386 7,533 15,169 67,091 12,697 102,875 3,193 34,600 51,948 1,377 45,124 5,803 102,875
2019E 939 8,267 16,685 64,740 13,902 104,534 4,957 29,642 49,611 1,377 48,291 6,632 104,534
2014 696 (758) 3,313 169 3,421 (8,822)
2015 4,151 (22) 4,708 1,552 10,389 (6,881)
2016 4,773 (276) 4,734 3,485 12,716 (11,825)
2017E 5,378 (60) 4,896 (5,919) 4,295 (18,582)
2018E 5,785 0 5,569 1,379 12,734 (10,795)
2019E 6,333 0 5,897 (1,146) 11,084 (3,665)
(8,822) 9,289 (180) (1,859) (531) 6,719 1,318 (5,401) (3.92)
(6,881) 3,477 (536) (1,377) (1,258) 306 3,813 3,508 2.55
(11,825) 5,923 2,334 (2,754) 2,220 7,724 8,616 892 0.63
(18,582) 256 (764) (2,550) 242 (2,817) (17,104) (14,287) (10.38)
(10,795) (2,088) (946) (2,689) 268 (5,455) (3,516) 1,938 1.41
(3,665) (3,193) (1,067) (2,893) 288 (6,865) 554 7,419 5.39
2014 (1.9) (55.8) (85.0) 2.5 1.8 0.0 0.4 0.2 160.0
2015 (17.4) 225.4 495.6 7.6 7.3 4.2 2.7 2.7 14.2
2016 (4.3) (5.0) 15.3 8.2 7.2 3.9 3.3 2.9 14.2
2017E 13.3 25.2 12.6 8.6 8.0 5.0 3.3 3.2 13.3
2018E (6.9) 10.4 7.6 9.4 9.4 5.8 3.8 3.8 13.8
2019E 9.7 5.9 9.5 9.2 9.1 5.6 3.8 3.8 14.1
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 4 of 5
Note: KT ZMICO has two major shareholders, Krungthai Bank PLC (KTB) and Seamico Securities PLC (ZMICO). Therefore, prior to making investments in the securities of KTB and ZMICO, investors should consider the risk factors carefully. An executive of KT ZMICO Securities is also a board member of BCP, BTC, CI, CPI, KBS, MAJOR, MK, PACE, PSL, SVH, VNG, ZMICO, SAWAD, TFG. A management member of KT ZMICO Securities is also a board member of BTC and NFC. KT ZMICO is a financial advisor for U, LOXLEY, ZMICO, MAKRO, CPALL, SAFARI, M‐CHAI, POMPUI, TFD, TTL, NMG.
Corporate Governance Report (CGR) Source: Sec, Thai Institute of Directors Association (IOD)
Excellent (scores: 90 ‐ 100) Very Good (scores: 80 – 89) Good (scores: 70 – 79)
Anti‐corruption Progress Indicator
Satisfactory (scores: 60 – 69) Pass (scores: 50 – 59) No Logo N/A (scores: below 50)
Source: Sec, Thailand's Private Sector Collective Action Coalition Against Corruption programme (Thai CAC) Level 1 (Committed) : Organization’s statement or board's resolution to work against corruption and to be in compliance with all relevant laws. Level 2 (Declared) : Public declaration statement to participate in Thailand's private sector Collective Action Coalition Against Corruption (CAC) or equivalent initiatives Level 3 (Established) : Public out preventive measures, risk assessment, communication and training for all employees, including consistent monitoring and review processes Level 4 (Certified) : Audit engagement by audit committee or auditors approved by the office of SEC, and receiving certification or assurance by independent external assurance providers (CAC etc.) Level 5 (Extended) : Extension of the anti‐corruption policy to business partners in the supply chain, and disclosure of any current investigations, prosecutions or closed cases Insufficient or not clearly defined policy Data not available / no policy DISCLAIMER
This document is produced using open sources believed to be reliable. However, their accuracy and completeness cannot be guaranteed. The statements and opinions herein were formed after due and careful consideration for use as information for the purposes of investment. The opinions contained herein are subject to change without notice. This document is not, and should not be construed as, an offer or the solicitation of an offer to buy or sell any securities. The use of any information contained in this document shall be at the sole discretion and risk of the user.
KT ZMICO RESEARCH – RECOMMENDATION DEFINITIONS STOCK RECOMMENDATIONS
SECTOR RECOMMENDATIONS
BUY: Expecting positive total returns of 15% or more OVERWEIGHT: The industry, as defined by the analyst's over the next 12 months coverage universe, is expected to outperform the relevant OUTPERFORM: Expecting total returns between ‐10% primary market index by at least 10% over the next 12 months. to +15%; returns expected to exceed market returns NEUTRAL: The industry, as defined by the analyst's coverage over a six‐month period due to specific catalysts universe, is expected to perform in line with the relevant UNDERPERFORM: Expecting total returns between primary market index over the next 12 months. ‐10% to +15%; returns expected to be below market UNDERWEIGHT: The industry, as defined by the analyst's returns over a six‐month period due to specific coverage universe, is expected to underperform the relevant catalysts primary market index by 10% over the next 12 months. SELL: Expecting negative total returns of 10% or more over the next 12 months
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 5 of 5
KT ZMICO Securities Company Limited Head Office
WWW.KTZMICO.COM
8th, 15th‐17th,19th, 21st Floor, Liberty Square Bldg., 287 Silom Road, Bangrak, Bangkok, Thailand 10500 Telephone: (66‐2) 695‐5000 Fax: (66‐2) 695‐5173 KT ZMICO Connect 662 695 5555
Central World Branch
Amarin Branch
22nd Floor, Amarin Building, 496‐502 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 018‐6200 Fax: (66‐2) 018‐6298, (66‐2) 018‐6299
8th Floor, Ton Son Tower, 900 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 626‐6000 Fax: (66‐2) 626‐6111
Phaholyothin Branch
Sindhorn Branch
Viphavadee Branch
2nd Floor, Sindhorn Tower 1, 130‐132 Wireless Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 627‐3550 Fax: (66‐2) 627‐3582, 627‐3600
G Floor, Lao Peng Nguan 1 Bldg., 333 Soi Cheypuand, Viphavadee‐Rangsit Road, Ladyao, Jatujak, Bangkok 10900 Telephone: (66‐2) 013‐8600 Fax: (66‐2) 618‐8569
BangKhae Branch
Chiang Mai Branch
Pak Chong Branch
999/9 The Offices at Central World, 16th Fl., Rama 1 Rd, Pathumwan, Bangkok 10330 Telephone: (66‐2) 264‐5888 Fax: (66‐2) 264 5899
1291/1, Shinnawatra Tower II, 3rd Floor, Phaholyothin Road, Phayathai, Bangkok 10400 Telephone: (66‐2) 686‐1500 Fax: (66‐2) 686‐1666
Ploenchit Branch
518 The Mall Group Building Bangkhae Branch, 6th Floor, Petchkasem Road, North Bangkhae, Bangkhae, Bangkok 10160 Telephone: (66‐2) 454‐9979 Fax: (66‐2) 454‐9970
422/49 Changklan Road, Changklan Subdistrict, Amphoe Meuang, Chiang Mai 50100 Telephone: (053) 270‐072 Fax: (053) 272‐618
173 175, Mittapap Road, Nong Sarai, Pak Chong, Nakhon Ratchasima 30130 Telephone: (044) 279‐511 Fax: (044) 279‐574
Korat Branch
Khon Kaen Branch
Chonburi Branch
624/9 Changphuek Road, T.Naimaung, A.Maung, Nakhon Ratchasima 30000 Telephone: (044) 247222 Fax: (044) 247171
5th Floor, Charoen Thani Princess Hotel, 260 Srichan Road, T. Naimuang, A. Muang, Khon Kaen 40000 Telephone: (043) 389‐171‐193 Fax: (043) 389‐209
4th Floor, Forum Plaza Bldg., 870/52 Sukhumvit Road, T. Bangplasoy, A. Muang, Cholburi 20000 Telephone: (038) 287‐635 Fax: (038) 287‐637
Pattaya Branch
Chachoengsao Branch
Hat Yai Branch
Easy Point 2, 392/65 Moo.9, T.Nong Prue, A. Bang Lamung, Chonburi 20260 Telephone: (038) 420‐965 Fax: (038) 420‐968
108/34‐36 Mahajakkrapad Road, T.Namuang, A.Muang, Chachoengsao 24000 Telephone: (038) 813‐088 Fax: (038) 813‐099
200/301, 200/303 JULDIS HATYAI PLAZA Floor 3 , Niphat‐Uthit 3 Rd, Hatyai Songkhla 90110 Telephone: (074) 355530‐3 Fax: (074) 355534
Phuket Branch
22/61‐63, Luang Por Wat Chalong Road, Talat Yai, Mueang Phuket, Phuket 83000 Telephone: (076) 222‐811, (076) 222‐683 Fax: (076) 222‐861
Phitsanulok Branch
227/171 Borom Trilokkanat Road, Muang, Phitsanulok 65000 Telephone: 055‐219‐255 to 8 Fax: 055‐219‐259
Nakhon Pathom
Cyber Branch Ayutthaya
Cyber Branch @ North Nana
Cyber Branch Chiangrai
KrungThai Bank, Rojana Branch 253 Moo 5, Rojana Road, Phai Ling, Phra Nakhon Si Ayutthaya, Phra Nakhonsi Ayutthaya, 13000 Telephone: 035‐242‐477 Fax: 035‐242‐476
Krung Thai Bank PCL, 2 Floor, North Nana Branch 35 Sukhumvit Rd., Klong Toey Nua Subdistrict , Wattana District , Bangkok 10110 Telephone: 083‐490‐2871
River Hotel (Building 3rd),1156 Petchakasem Road, Sanamchan Subdistrict, Amphoe Meuang , Nakhon Pathom Province 73000 Telephone: (034) 271300 Fax: (034) 271300 #100
KrungThai Bank, Hayaek Phokhun Mengrai Branch 116/19 Moo 19, Highway 110 Road, Rop Wiang, Mueang Chiang Rai, Chiang Rai, 57000 Telephone: 053‐715‐067 Fax: 053‐715‐068
Company Update
Close Bt32.75
Energy & Utilities April 26, 2017
Earnings upgrade / Earnings downgrade / Overview unchanged
Expect soaring earnings in 1Q17E Price Performance (%)
Source: SET Smart
FY17
FY18
Consensus EPS (Bt)
3.872
4.145
KT ZMICO vs. consensus Share data
1.0%
1.3%
Reuters / Bloomberg
BCP.BK/BCP TB
Paid‐up Shares (m)
1,376.92
Par (Bt)
1.00
Market cap (Bt bn / US$ m)
45.00/1,311.00
Foreign limit / actual (%)
25.00/15.78
52 week High / Low (Bt)
37.00/28.25
Avg. daily T/O (shares 000)
5,630.00
NVDR (%)
8.00
Estimated free float (%)
59.8
Beta
0.94
URL
www.bangchak.co.th
CGR Anti‐corruption
Level 4 (Certified)
Note: An executive of KT ZMICO Securities is also a member of BCP’s board.
Patcharin Karsemarnuntana Analyst, no 17834 [email protected] 66 (0) 2695‐5837
Growth story intact Given the company’s marketing business making a back‐to‐normal contribution in 1Q17E to help relieve the market’s concern, the good mix of diversified earnings continuing, as well as the growth stories of BCPG (underway, with a new MW addition towards 2018E) and its 3E project (to be fully complete in 2020E), we maintain a Buy rating on BCP. Expect soaring NP at Bt1.75bn in 1Q17E We expect BCP to deliver soaring earnings in 1Q17E with projected NP of Bt1.75bn (+36.5 times YoY, +54.5% QoQ) and core profit of Bt1.44bn, reversing from a normalized loss in 1Q16 (due to the 46‐day planned shutdown and a substantial stock loss in the quarter) and increasing 24% QoQ with operational improvement seen (EBITDA level) in all major businesses. Stronger EBITDA contribution in 1Q17E, particularly in the case of marketing business QoQ and refinery business YoY We expect a stronger EBITDA contribution in 1Q17E, particularly in the case of the marketing business on a QoQ basis, whose EBITDA contribution should be back to the normal level in 1Q17E (~mid‐ Bt600mn) following stronger sales volume to 1,540mn litres and a rebound of the marketing margin to Bt0.76/litre (vs. a negative EBITDA contribution of Bt3bn in 4Q16, with the unadjusted retail price causing a low margin of Bt0.56/litre, as well as high advertising expenses and the set up expenses of SPAR supermarket). Meanwhile, its refinery is expected to make a stronger EBITDA contribution in 1Q17E, especially YoY given the sustained high crude run at 110kbd (vs. 64kbd in 1Q16 from a planned shutdown) and projected accounting GRM of US$7.6/bbl in the quarter given the higher market GRM driven by competitive Brent‐linked crude and slim stock gain (vs. ‐US$0.24/bbl in 1Q16 and US$8.73/bbl in 4Q16). At the same time, a solid EBITDA contribution is expected at its solar business in 1Q17E, with higher power generation at both solar Thailand (with the first full‐quarter contribution from the solar co‐op totaling 12MW) and solar Japan (with the kickoff of the new project with the 10.5MW PPA in Mar‐2017). Keep 2017E earnings estimate unchanged We are comfortable with our 2017E forecasts calling for Bt13bn EBITDA and Bt5.3bn core profit (with the 1Q17E figures accounting for 26% and 27%, respectively), with no refinery shutdown and higher profit from BCPG following the ramp up of the contribution from solar Japan as the major drivers. Financials and Valuation FY Ended 31 Dec Revenues (Btmn) Net profit (Btmn) EPS (Bt) EPS growth (%) Dividend (Bt) BV (Bt) FY Ended 31 Dec PER (x) EV/EBITDA (x) PBV (x) Dividend yield (%) ROE (%) Net gearing (%)
2015 151,140 4,151 3.01 495.55 2.00 25.77 2015 10.88 6.04 1.27 6.1% 12.1% 60.1%
2016 144,705 4,773 3.47 15.28 1.80 28.72 2016 9.44 6.10 1.14 5.5% 12.7% 47.1%
2017E 163,996 5,378 3.91 12.56 1.95 30.67 2017E 8.39 6.20 1.07 6.0% 13.2% 85.2%
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 1 of 5
2018E 152,754 5,785 4.20 7.58 2.10 32.77 2018E 7.79 5.72 1.00 6.4% 13.2% 82.9%
2019E 167,643 6,333 4.60 9.47 2.30 35.07 2019E 7.12 5.15 0.93 7.0% 13.6% 69.7%
Figure 1: BCP’s 1Q17E earnings preview Profit and Loss (Btmn) Year-end 31 Dec Revenue Gross profit EBITDA Interest expense Other income Income tax Forex gain (loss) Other extraordinary Items Gn (Ls) from affiliates Minority interests Net profit (loss) Core profit (loss) Reported EPS (Bt) Gross margin (%) EBITDA margin (%) Net margin (%) Current ratio (x) Interest coverage (x) Interest-bearing debt / equity (x) BVPS (Bt) ROE (%)
1Q16 30,276 949 835 (373) 289 167 141 2 13 72 47 (96) 0.03 3.1 2.8 0.2 2.8 (0.7) 0.9 25.8 0.5
4Q16 40,481 3,759 2,966 (415) 111 (164) (285) 258 16 (77) 1,131 1,159 0.83 9.3 7.3 2.8 1.7 4.1 1.0 28.7 11.4
1Q17E 40,855 3,666 3,452 (418) 105 (309) 311 10 (84) 1,748 1,437 1.27 9.0 8.4 4.3 1.8 5.1 0.7 30.0 16.9
Source: KT Zmico Research Note: *including stock gain (loss) impact as the recurring item
% YoY 34.9 286.5 313.4 12.2 (63.7) nm 121.3 (100.0) (20.3) nm 3,650.9 nm 4,131.1
% QoQ 0.9 (2.5) 16.4 0.7 (5.2) 89.1 nm (100.0) (35.6) 9.1 54.5 24.0 53.1
2016 144,705 11,896 10,442 (1,484) 634 (689) 276 263 21 44 4,773 4,234 3.47 8.2 7.2 3.3 1.7 3.8 1.0 28.7 12.7
2017E 163,996 14,046 13,070 (1,549) 235 (916) 60 35 (661) 5,378 5,318 3.91 8.6 8.0 3.3 1.9 5.3 0.9 30.7 13.2
% YoY 13.3 18.1 25.2 4.4 (63.0) 32.9 (78.3) (100.0) 66.9 nm 12.7 25.6 12.6
Figure 2: BCP’s quarterly data A) BCP’s quarterly crude run
B) BCP’s quarterly accounting GRM
Source: KT Zmico Research REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 2 of 5
YTD (% of 17E) 25% 26% 26% 27% 45% 34% 518% nm 29% 13% 33% 27% 32%
Figure 3: BCP’s PBV band
Source: Bloomberg, KT ZMICO Research
REFER TO DISCLOSURE SECTION AT THE END OF THE NOTES page 3 of 5
Financial tables PROFIT & LOSS (Btm) Revenues Cost of sales and service Gross profit SG&A EBITDA Depreciation & amortization EBIT Interest expense Other income / exp. EBT Corporate tax Forex gain (loss) Extra Items Gain (loss) from affiliates Minority interests Net profit Reported EPS Fully diluted EPS Core net profit Core EPS Dividend (Bt) BALANCE SHEET (Btm) Cash and equivalents Accounts receivable Inventories PP&E‐net Other assets Total assets ST debt & current portion Long‐term debt Total liabilities Paid‐up shares Shareholder equity Minority interests Total liab. & shareholder equity CASH FLOW (Btm) Net income Forex and other extraordinary adjustments Depreciation & amortization Change in working capital Cash flow from operations Capex (Invest)/Divest Others Cash flow from investing Debt financing (repayment) Equity financing Dividend payment Others Cash flow from financing Net change in cash Free cash flow FCF per share (Bt) PROFITABILITY Revenue growth (%) EBITDA growth (%) EPS growth (%) Gross margin (%) EBITDA margin (%) Operating margin (%) Net margin (%) Core profit margin (%) Effective tax rate (%)
2014 183,016 (178,473) 4,543 (4,480) 3,377 3,313 63 (1,427) 932 (431) 691 758 (393) 5 67 696 0.51 0.51 331 0.24 1.00
2015 151,140 (139,686) 11,454 (5,175) 10,987 4,708 6,279 (1,615) 61 4,725 (673) 22 11 12 53 4,151 3.01 3.01 4,118 2.99 2.00
2016 144,705 (132,809) 11,896 (6,189) 10,442 4,734 5,707 (1,484) 634 4,858 (689) 276 263 21 44 4,773 3.47 3.37 4,234 3.07 1.80
2017E 163,996 (149,950) 14,046 (5,872) 13,070 4,896 8,173 (1,549) 235 6,859 (916) 60 0 35 (661) 5,378 3.91 3.91 5,318 3.86 1.95
2018E 152,754 (138,414) 14,341 (5,481) 14,429 5,569 8,860 (1,546) 260 7,574 (1,047) 0 0 35 (777) 5,785 4.20 4.20 5,785 4.20 2.10
2019E 167,643 (152,253) 15,389 (6,003) 15,283 5,897 9,386 (1,347) 260 8,300 (1,173) 0 0 35 (829) 6,333 4.60 4.60 6,333 4.60 2.30
2014 8,577 7,095 14,059 39,532 7,703 76,966 1,312 28,913 43,000 1,377 33,309 657 76,966
2015 12,390 5,977 13,945 41,687 7,943 81,942 1,026 32,675 45,959 1,377 35,481 502 81,942
2016 21,006 7,213 14,560 48,401 10,603 101,783 11,141 28,483 57,874 1,377 39,543 4,366 101,783
2017E 3,902 8,087 16,433 61,978 11,601 102,002 4,572 35,308 54,744 1,377 42,232 5,027 102,002
2018E 386 7,533 15,169 67,091 12,697 102,875 3,193 34,600 51,948 1,377 45,124 5,803 102,875
2019E 939 8,267 16,685 64,740 13,902 104,534 4,957 29,642 49,611 1,377 48,291 6,632 104,534
2014 696 (758) 3,313 169 3,421 (8,822)
2015 4,151 (22) 4,708 1,552 10,389 (6,881)
2016 4,773 (276) 4,734 3,485 12,716 (11,825)
2017E 5,378 (60) 4,896 (5,919) 4,295 (18,582)
2018E 5,785 0 5,569 1,379 12,734 (10,795)
2019E 6,333 0 5,897 (1,146) 11,084 (3,665)
(8,822) 9,289 (180) (1,859) (531) 6,719 1,318 (5,401) (3.92)
(6,881) 3,477 (536) (1,377) (1,258) 306 3,813 3,508 2.55
(11,825) 5,923 2,334 (2,754) 2,220 7,724 8,616 892 0.63
(18,582) 256 (764) (2,550) 242 (2,817) (17,104) (14,287) (10.38)
(10,795) (2,088) (946) (2,689) 268 (5,455) (3,516) 1,938 1.41
(3,665) (3,193) (1,067) (2,893) 288 (6,865) 554 7,419 5.39
2014 (1.9) (55.8) (85.0) 2.5 1.8 0.0 0.4 0.2 160.0
2015 (17.4) 225.4 495.6 7.6 7.3 4.2 2.7 2.7 14.2
2016 (4.3) (5.0) 15.3 8.2 7.2 3.9 3.3 2.9 14.2
2017E 13.3 25.2 12.6 8.6 8.0 5.0 3.3 3.2 13.3
2018E (6.9) 10.4 7.6 9.4 9.4 5.8 3.8 3.8 13.8
2019E 9.7 5.9 9.5 9.2 9.1 5.6 3.8 3.8 14.1
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Note: KT ZMICO has two major shareholders, Krungthai Bank PLC (KTB) and Seamico Securities PLC (ZMICO). Therefore, prior to making investments in the securities of KTB and ZMICO, investors should consider the risk factors carefully. An executive of KT ZMICO Securities is also a board member of BCP, BTC, CI, CPI, KBS, MAJOR, MK, PACE, PSL, SVH, VNG, ZMICO, SAWAD, TFG. A management member of KT ZMICO Securities is also a board member of BTC and NFC. KT ZMICO is a financial advisor for U, LOXLEY, ZMICO, MAKRO, CPALL, SAFARI, M‐CHAI, POMPUI, TFD, TTL, NMG.
Corporate Governance Report (CGR) Source: Sec, Thai Institute of Directors Association (IOD)
Excellent (scores: 90 ‐ 100) Very Good (scores: 80 – 89) Good (scores: 70 – 79)
Anti‐corruption Progress Indicator
Satisfactory (scores: 60 – 69) Pass (scores: 50 – 59) No Logo N/A (scores: below 50)
Source: Sec, Thailand's Private Sector Collective Action Coalition Against Corruption programme (Thai CAC) Level 1 (Committed) : Organization’s statement or board's resolution to work against corruption and to be in compliance with all relevant laws. Level 2 (Declared) : Public declaration statement to participate in Thailand's private sector Collective Action Coalition Against Corruption (CAC) or equivalent initiatives Level 3 (Established) : Public out preventive measures, risk assessment, communication and training for all employees, including consistent monitoring and review processes Level 4 (Certified) : Audit engagement by audit committee or auditors approved by the office of SEC, and receiving certification or assurance by independent external assurance providers (CAC etc.) Level 5 (Extended) : Extension of the anti‐corruption policy to business partners in the supply chain, and disclosure of any current investigations, prosecutions or closed cases Insufficient or not clearly defined policy Data not available / no policy DISCLAIMER
This document is produced using open sources believed to be reliable. However, their accuracy and completeness cannot be guaranteed. The statements and opinions herein were formed after due and careful consideration for use as information for the purposes of investment. The opinions contained herein are subject to change without notice. This document is not, and should not be construed as, an offer or the solicitation of an offer to buy or sell any securities. The use of any information contained in this document shall be at the sole discretion and risk of the user.
KT ZMICO RESEARCH – RECOMMENDATION DEFINITIONS STOCK RECOMMENDATIONS
SECTOR RECOMMENDATIONS
BUY: Expecting positive total returns of 15% or more OVERWEIGHT: The industry, as defined by the analyst's over the next 12 months coverage universe, is expected to outperform the relevant OUTPERFORM: Expecting total returns between ‐10% primary market index by at least 10% over the next 12 months. to +15%; returns expected to exceed market returns NEUTRAL: The industry, as defined by the analyst's coverage over a six‐month period due to specific catalysts universe, is expected to perform in line with the relevant UNDERPERFORM: Expecting total returns between primary market index over the next 12 months. ‐10% to +15%; returns expected to be below market UNDERWEIGHT: The industry, as defined by the analyst's returns over a six‐month period due to specific coverage universe, is expected to underperform the relevant catalysts primary market index by 10% over the next 12 months. SELL: Expecting negative total returns of 10% or more over the next 12 months
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KT ZMICO Securities Company Limited Head Office
WWW.KTZMICO.COM
8th, 15th‐17th,19th, 21st Floor, Liberty Square Bldg., 287 Silom Road, Bangrak, Bangkok, Thailand 10500 Telephone: (66‐2) 695‐5000 Fax: (66‐2) 695‐5173 KT ZMICO Connect 662 695 5555
Central World Branch
Amarin Branch
22nd Floor, Amarin Building, 496‐502 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 018‐6200 Fax: (66‐2) 018‐6298, (66‐2) 018‐6299
8th Floor, Ton Son Tower, 900 Ploenchit Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 626‐6000 Fax: (66‐2) 626‐6111
Phaholyothin Branch
Sindhorn Branch
Viphavadee Branch
2nd Floor, Sindhorn Tower 1, 130‐132 Wireless Road, Lumpini, Pathumwan, Bangkok 10330 Telephone: (66‐2) 627‐3550 Fax: (66‐2) 627‐3582, 627‐3600
G Floor, Lao Peng Nguan 1 Bldg., 333 Soi Cheypuand, Viphavadee‐Rangsit Road, Ladyao, Jatujak, Bangkok 10900 Telephone: (66‐2) 013‐8600 Fax: (66‐2) 618‐8569
BangKhae Branch
Chiang Mai Branch
Pak Chong Branch
999/9 The Offices at Central World, 16th Fl., Rama 1 Rd, Pathumwan, Bangkok 10330 Telephone: (66‐2) 264‐5888 Fax: (66‐2) 264 5899
1291/1, Shinnawatra Tower II, 3rd Floor, Phaholyothin Road, Phayathai, Bangkok 10400 Telephone: (66‐2) 686‐1500 Fax: (66‐2) 686‐1666
Ploenchit Branch
518 The Mall Group Building Bangkhae Branch, 6th Floor, Petchkasem Road, North Bangkhae, Bangkhae, Bangkok 10160 Telephone: (66‐2) 454‐9979 Fax: (66‐2) 454‐9970
422/49 Changklan Road, Changklan Subdistrict, Amphoe Meuang, Chiang Mai 50100 Telephone: (053) 270‐072 Fax: (053) 272‐618
173 175, Mittapap Road, Nong Sarai, Pak Chong, Nakhon Ratchasima 30130 Telephone: (044) 279‐511 Fax: (044) 279‐574
Korat Branch
Khon Kaen Branch
Chonburi Branch
624/9 Changphuek Road, T.Naimaung, A.Maung, Nakhon Ratchasima 30000 Telephone: (044) 247222 Fax: (044) 247171
5th Floor, Charoen Thani Princess Hotel, 260 Srichan Road, T. Naimuang, A. Muang, Khon Kaen 40000 Telephone: (043) 389‐171‐193 Fax: (043) 389‐209
4th Floor, Forum Plaza Bldg., 870/52 Sukhumvit Road, T. Bangplasoy, A. Muang, Cholburi 20000 Telephone: (038) 287‐635 Fax: (038) 287‐637
Pattaya Branch
Chachoengsao Branch
Hat Yai Branch
Easy Point 2, 392/65 Moo.9, T.Nong Prue, A. Bang Lamung, Chonburi 20260 Telephone: (038) 420‐965 Fax: (038) 420‐968
108/34‐36 Mahajakkrapad Road, T.Namuang, A.Muang, Chachoengsao 24000 Telephone: (038) 813‐088 Fax: (038) 813‐099
200/301, 200/303 JULDIS HATYAI PLAZA Floor 3 , Niphat‐Uthit 3 Rd, Hatyai Songkhla 90110 Telephone: (074) 355530‐3 Fax: (074) 355534
Phuket Branch
22/61‐63, Luang Por Wat Chalong Road, Talat Yai, Mueang Phuket, Phuket 83000 Telephone: (076) 222‐811, (076) 222‐683 Fax: (076) 222‐861
Phitsanulok Branch
227/171 Borom Trilokkanat Road, Muang, Phitsanulok 65000 Telephone: 055‐219‐255 to 8 Fax: 055‐219‐259
Nakhon Pathom
Cyber Branch Ayutthaya
Cyber Branch @ North Nana
Cyber Branch Chiangrai
KrungThai Bank, Rojana Branch 253 Moo 5, Rojana Road, Phai Ling, Phra Nakhon Si Ayutthaya, Phra Nakhonsi Ayutthaya, 13000 Telephone: 035‐242‐477 Fax: 035‐242‐476
Krung Thai Bank PCL, 2 Floor, North Nana Branch 35 Sukhumvit Rd., Klong Toey Nua Subdistrict , Wattana District , Bangkok 10110 Telephone: 083‐490‐2871
River Hotel (Building 3rd),1156 Petchakasem Road, Sanamchan Subdistrict, Amphoe Meuang , Nakhon Pathom Province 73000 Telephone: (034) 271300 Fax: (034) 271300 #100
KrungThai Bank, Hayaek Phokhun Mengrai Branch 116/19 Moo 19, Highway 110 Road, Rop Wiang, Mueang Chiang Rai, Chiang Rai, 57000 Telephone: 053‐715‐067 Fax: 053‐715‐068
