TTA reported high net profits of Baht 1,448.7 million in 3Q/2022

• TTA reported solid revenues of Baht 8,072.7 million in 3Q/2022, increasing 36%YoY.
• Shipping Segment outperformed the net Supramax market rate by 24% with its TCE rate of US$ 23,169 per day on average.
• Offshore Service Segment continued to be profitable with strong at US$ 329 million at the end of 3Q/2022.
• Agrochemical segment's domestic and export sales volume had been recovering.
• Due to solid operating profits and low IBD/E at 0.35 times, financial position remained strong with cash under management of Baht 12.8 billion.

Bangkok, Thailand, 10 November 2022 - In 3Q/2022, Thoresen Thai Agencies Public Company Limited (TTA) reported solid revenues of Baht 8,072.7 million, increasing 36%YoY mainly driven by the significant growth in Offshore Service and remained stable QoQ. Shipping, Offshore Service, Agrochemical, Food & Beverage, and Investment segments contributed 43%, 30%, 17%, 6%, and 4% to the consolidated revenues, respectively. Gross profits amounted to Baht 2,389.9 million decreased 3%YoY and 9%QoQ mainly due to the lower Shipping's time charter equivalent (TCE) rate. EBITDA decreased by 9%YoY and 12%QoQ to Baht 1,757.1 million. In summary, TTA reported high net profits of Baht 1,448.7 million in 3Q/2022, decreasing 10%YoY but increasing 40%QoQ.

As of September 30, 2022, TTA had total assets of Baht 45,660.2 million, increased by Baht 6,713.1 million or 17% from the end of 2021, mainly due to an increase in cash and cash equivalents from operating profit of 9M/2022, an increase in property, plant, and equipment from the acquisition of an Offshore Service vessel, and an increase in right-of-use assets from a charter-in vessel for Offshore business. Cash under management, which combines cash, cash equivalents, and other current financial assets, remained high at Baht 12,785.1 million. Total liabilities were Baht 15,942.2 million, increased by Baht 1,395.4 million or 10% from the end of 2021, mainly due to a growth in trade payable in line with the increasing revenues and an increase in lease liabilities from a charter-in vessel.

Mr. Chalermchai Mahagitsiri, TTA President and Chief Executive Officer, said: "Baltic Supramax Index (BSI) averaged 1,793 points in 3Q/2022, decreased from an average of 2,627 points in 2Q/2022 due to the easing of port congestion and the impact of economic headwinds. Therefore, the TC rate of Supramax averaged US$ 19,728 per day in 3Q/2022 decreasing from US$ 28,901 per day in 2Q/2022.

Shipping Segment continued to maintain its outstanding position with TCE rate outperforming the net market rate. Offshore Service segment are now more likely than ever to outperform on profitability with a strong order book and positive outlook driven by the cable laying business. The Agrochemical segment reported the increased sales revenue from fertilizer due to the increasing fertilizer selling price, and the increase in fertilizer sales volume both domestic and export. Moreover, TTA has succeeded to be listed in the Stock Exchange of Thailand's (SET) 'Thailand Sustainability Investment (THSI) 2022' in the 'Services' category. Looking forward to sustainable development, we continue to make significant investments to support our long-term plans and to strengthen corporate governance."

Key Strategic Business Segment Performance

Shipping Segment:

Thoresen Shipping's freight revenues were reported at Baht 3,480.6 million in 3Q/2022. TCE rate is at US$ 23,169 per day on average which outperformed the net Supramax market rate of US$ 18,741 by 24%. Meanwhile, vessel operating expenses (OPEX) decreased by 2%YoY and 7%QoQ to US$ 3,764 per day, mainly due to lower expenses related to crew change.

Thoresen Shipping delivered net profits to TTA of Baht 1,214.1 million, decreasing 31%YoY and 31%QoQ in 3Q/2022. At quarter-end, Thoresen Shipping owned 24 vessels (22 Supramaxes and 2 Ultramaxes) with an average size of 55,913 DWT and an average age of 14.5 years.

According to Clarksons Research, dry bulk trade growth in full-year 2022 is projected to decrease by 1.6% in tons with a slight decline of 0.5% in ton-miles due to a shift in trade patterns to longer-haul responding to the Russia-Ukraine conflict, while fleet expansion is projected at 2.7% in the deadweight ton (DWT). Despite macroeconomic challenges and demand-side impacts related to the Russia-Ukraine conflict, the dry bulk earnings remain far above historical averages. Looking further to 2023, dry bulk trade is projected to grow 0.8% in tons or 1.9% in ton-miles against the fleet expansion of 0.5%. However, future growth prospects still depend on risks associated with global economic conditions.

Offshore Service Segment:

In 3Q/2022, Mermaid Maritime Public Company Limited (Mermaid Maritime) recorded revenues of Baht 2,396.3 million, with significant increased 179%YoY mainly from the expansion of services to the cable laying, decommissioning, and Transportation & Installation (T&I) businesses, and increased 27%QoQ mainly from decommissioning and T&I projects.

Gross profit margin strongly increased to 20% in 3Q/2022. Gross profits amounted to Baht 476.4 million, increased 534%YoY and 65%QoQ due to better margins of most services, mainly cable laying projects and decommissioning, and T&I projects. In addition, there were share profits of Baht 20.1 million from a joint venture under Offshore Service segment.

Mermaid Maritime's EBITDA significantly improved by 944%YoY and 112%QoQ to Baht 397.1 million. In summary, Mermaid Maritime continued to be profitable with net profits of Baht 114.1 million and net profit to TTA of Baht 61.8 million in 3Q/2022. At the quarter end, the order book remained high at US$ 329 million

Agrochemical Segment:

PM Thoresen Asia Holdings Public Company Limited (PMTA) reported sales revenue of Baht 1,420.2 million in 3Q/2022, increased 71%YoY due to due to increase in revenues from all products and services and increased 40%QoQ largely from the recovery of fertilizer sales volume. The sales revenue from fertilizer increased 73%YoY because of the increasing fertilizer selling price, and increased 45%QoQ due to increase in fertilizer sales volume both domestic and export.

Total fertilizer sales volume recorded at 46.0 Ktons, increased 27%QoQ due to the recovery of domestic and export volume. Domestic fertilizer sales volume accounted for 49% of total fertilizer sales volume, totaling 22.7 Ktons, increased 15%QoQ due to the slow recovery of domestic demand during end of the quarter as wholesalers and farmers start to prepare for the high season in fourth quarter. Meanwhile, fertilizer export volumes to Southeast Asia expanded. Therefore, export fertilizer sales volume increased 67%YoY and 40%QoQ to 23.3 Ktons. Service income from factory area management also increased 58%YoY and 15%QoQ to Baht 27.7 million because of the growing activities for the warehouse and services.

Gross profits increased 91%YoY and 43%QoQ to Baht 198.3 million. With a different sales mix and higher raw material prices caused by less supply and higher oil prices, PMTA has been able to adjust the fertilizer selling price to maintain the margin. The gross profit margin increased to 14% in 3Q/2022. EBITDA increased 102%YoY and 92%QoQ to Baht 82.4 million. In summary, PMTA reported net profits to TTA of Baht 28.0 million in 3Q/2022, increasing 64%YoY and 150%QoQ.

Food & Beverage

Pizza Hut is operated as a 70%-owned subsidiary of TTA. As of 30 September 2022, there were 187 outlets nationwide. All new outlets were opened in the high traffic location in major provinces.

Taco Bell, the leading American restaurant chain serving a variety of Mexican inspired food, is operated as a 70%-owned subsidiary of TTA. As of 30 September 2022, there were 12 outlets nationwide.

Investment:

As of 30 September 2022, TTA's investment in digital assets amounted to Baht 1,139.7 million.

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