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1Herkese Açık / Public
2Q20 ResultsInvestor Presentation
2Herkese Açık / Public
Ethylene – Naphtha spread averaged US$ 255/ton in 2Q20
• Ethylene-naphtha spread decreased by 31% from US$ 369/ton in 1Q20 to US$ 255/ton in 2Q20.
• Spread was quite weak in the second quarter, especially in May, as a result of petrochemicals down cycle conditions
compounded by COVID-19 driving overall lower volumes and margins.
• Naphtha prices were on the uptrend in May, on the back of oil production cuts, with demand picking up as lockdowns
started to ease and business activities in general started to resume.
• Starting from mid-May, ethylene supply has become less long since mid-May on the effect of unplanned issues and delays
in restarts from maintenance and ethylene price has shown a partial recovery leading a slight increase in spread again.
Monthly Naphtha - Ethylene Spread (CIF MED Spot Prices)
425 436 479 529611 605
441 502 492 447301 247
329 352435
300194 287 341
449483 515
552 535473 504
442 472 484 513 526 514448
216130
209329
371
875918
9941,080
1,1461,078
944 944 964 931
814773
844801
651
430 403
616712
Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20
US
D/t
on
ne
Spread Naphtha Ethylene
3Herkese Açık / Public
PLATTs Index averaged US$ 565 per ton in 2Q20
• PLATTS Global Petrochemicals Index starts to recover on a monthly basis after seeing the lowest level in April.
• Index averaged at USD565/ton in 2Q20, suggesting 22% decrease Q-Q and 36% decrease Y-Y.
• Despite almost all product prices were lower compared to the first quarter, some product group spreads were quite
strong and higher due to the fact that the decrease in naphtha prices was much more higher than the decrease in the
some product prices, like polymers.
• On the other hand, some of petrochemical products such as, benzene, C4 prices and product spreads were enormously
weak which are severely impacted by the pandemic as its demand is mainly driven by the automotive sector.
Monthly Average Platts Index
868
912 898 898 890
844 837 845 848
814
778 759
794
748
639
501
550
635
681 691
Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20
4Herkese Açık / Public
Product group spreads(Over naphtha CIF MED), USD/MT
Source: Platts, Company
0
200
400
600
Ja
n-1
9
Feb
-19
Ma
r-19
Ap
r-19
Ma
y-19
Ju
n-1
9
Ju
l-19
Au
g-1
9
Sep
-19
Oct
-19
No
v-1
9
De
c-19
Ja
n-2
0
Feb
-20
Ma
r-2
0
Ap
r-2
0
Ma
y-2
0
Ju
n-2
0
Ju
l-2
0
Au
g-2
0
Aromatics group spread
OrthoXylene
Paraxylene
Benzene
Weighted
150
350
550
750
Ja
n-1
9
Feb
-19
Ma
r-19
Ap
r-19
Ma
y-19
Ju
n-1
9
Ju
l-19
Au
g-1
9
Sep
-19
Oct
-19
No
v-1
9
De
c-19
Ja
n-2
0
Feb
-20
Ma
r-2
0
Ap
r-2
0
Ma
y-2
0
Ju
n-2
0
Ju
l-2
0
Au
g-2
0
Polymers group spread
Weighted
PP
LDPE
PVC
HDPE
-100
200
500
800
1100
1400
Ja
n-1
9
Feb
-19
Ma
r-19
Ap
r-19
Ma
y-19
Ju
n-1
9
Ju
l-19
Au
g-1
9
Sep
-19
Oct
-19
No
v-1
9
De
c-19
Ja
n-2
0
Feb
-20
Ma
r-2
0
Ap
r-2
0
Ma
y-2
0
Ju
n-2
0
Ju
l-2
0
Au
g-2
0Fibres group spread
WeightedACN
PTA
MEG
DEG
-100
100
300
500
700
900
Ja
n-1
9
Feb
-19
Ma
r-19
Ap
r-19
Ma
y-19
Ju
n-1
9
Ju
l-19
Au
g-1
9
Sep
-19
Oct
-19
No
v-1
9
De
c-19
Ja
n-2
0
Feb
-20
Ma
r-2
0
Ap
r-2
0
Ma
y-2
0
Ju
n-2
0
Ju
l-2
0
Au
g-2
0
Other group spread
PGP
PA
Crude C4
Weighted
PY-GAS
5Herkese Açık / Public
Product groups and overall weighted spread (over naphtha CIF MED), USD/MT
Source: Platts, Company
0
200
400
600
Weighted averages by product groups spreads
Polymers
Fiber
Others
Aromatics
6Herkese Açık / Public
Feedstock vs. Product Prices
• 279Kton feedstock has been supplied from STAR
Refinery in Q220.
• Thermoplastics demand still much healthier for
packaging, food, health and medical sectors.
• Thermoplastics margin averaged at 681 in the second
quarter ,which is 12% higher on quarterly basis and 2%
higher on yearly basis ,thanks to the low feedstock
prices.
• In the second quarter of 2020, 548Kton total sales was
recorded.
• As historical low levels of oil prices were seen at the
beginning of the second quarter, Petkim management
successfully managed the price volatility and benefited
from low feedstock prices.
667 673 669 600 598 570 581 511 462 507 558 765 764
668 612
1,2011,210
1,1641,092 1,057 1,034 1,053 1,013 964 1,015
1,0401,043
927
849 903
535537 495 492 459 464 472 502 502 507 482
279163 182 291
Petkim - Thermoplastics & Naphtha Spread
Spread Thermoplastics Naphtha
US
D/t
on
225 243
161
105 121 147 138
90 68
54 53
111
90 133 105
(30)
20
70
120
170
220
270
320
200
300
400
50 0
600
700
800
900
1,000
1,10 0
Petkim Unit Margins
Margin (Right Axis) Unit Price Unit Cost
7Herkese Açık / Public
Costs and Operational Efficiency in 2Q20
67% 13%
7%
13%
Raw material
Energy
Labor
Other
Plant Cost Base Breakdown 2Q20*
*Cumulative figures are provided
86%
102% 100%
38%
99%105% 106% 105%
98%92%
1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20
Ethylene Facility Capacity Utilization Rate
788
894 891 870 802
729
2,724 2,468 2,541 2,582
2,861 2,950
1,500
2,000
2,500
3,000
3,500
4,000
1Q19 2Q19 3Q19 4Q19 1Q20 2Q20
2 0 0
3 0 0
4 0 0
5 0 0
6 0 0
7 0 0
8 0 0
9 0 0
1 , 0 0 0
Total Production & Energy Consumption
Total Production (ton k) Unit Energy consumption (103*kcal/ton)
176 176 178 171 166
117 98 137 110 90
90 98 59 74 67
70 71 73 6751
459 461 461 428
378
(50)
50
150
250
350
450
550
650
2 Q 1 9 3 Q 1 9 4 Q 1 9 1 Q 2 0 2 Q 2 0
Thermoplastics Other Aromatics Fiber Ethylene
Sellable Production (ton K)
8Herkese Açık / Public
147
544
143202
13781 57 58
7 043 24
241
557
Revenue (TL mn)
5
122
2 4 931
5
58
7 043
77
321
Export Revenue (TL mn)
2Q20 Volume: 548k ton
In 2Q20 Petkim achieved TL 2,242mn sales via 548k ton volume
2Q20 Revenue: TL2,242mn
2Q20 Export Revenue: TL685mn
27
87
2333
23 28 2035
5
2914 13
58
152
Sales Volume (ton k)
9Herkese Açık / Public
Turkey’s Import
Petkim/Domestic Sale
Domestic Consumption
Domestic Market Share %Source: TURKSTAT, Company
Ton k
605 546
111 137
15% 20%
2018 2019
v
PVC
246 238
252 279
51% 54%
2018 2019
LDPE
566 558
78 86
12% 13%
2018 2019
HDPE
1,646 1,794
117 141
7% 7%
2015 2016
PP
Turkey thermoplastics consumption decreased by 2% in 2Q20 compared to 1Q20.
156 140 33 26
18% 15%
0
200
400
600
800
2020Q1 2020Q2
169 182 23 27
12% 13%
0
200
400
600
2020Q1 2020Q2
72 68
75 71
51% 51%
0
200
400
600
2020Q1 2020Q2
489 489
36 35
7% 7%
(100)
100
300
500
700
900
1,100
1,300
1,500
2020Q1 2020Q2
10Herkese Açık / Public
Turkey’s Import
Petkim/Domestic Sale
Domestic Consumption
Domestic Market Share %
Fiber consumption in Turkey increased by 2% in 2Q20 compared to 1Q20.
Source: TURKSTAT, Company
Ton k
187
150 79 86
30% 36%
2018 2019
v
ACN
v270
302
58 78
18% 20%
2018 2019
MEG
v479 552
84 141
15% 20%
2018 2019
PTA
33 30 19 21
36% 41%
0
200
2020Q1 2020Q2
91 83 15 18
15% 19%
0
20
40
60
80
100
120
140
160
180
200
220
240
260
280
300
320
340
360
380
400
2020Q1 2020Q2
172 189 29 25
15% 12%
0
200
400
600
800
2020Q1 2020Q2
11Herkese Açık / Public
Turkey’s Import
Petkim/Domestic Sale
Domestic Consumption
Domestic Market Share %
Turkish Market – Others
Source: TURKSTAT, Company
Ton k
117 130
51 60
30% 32%
2018 2019
v
PX
14
28
35 37
71% 57%
2018 2019
v
PA
31 41 13 10
29% 25%
(10)
20
50
80
110
140
170
200
2020Q1 2020Q2
6 4
10
8
63% 65%
2020Q1 2020Q2
12Herkese Açık / Public
PETKIM 2Q20 Income Statement
TL mn 6M'19 6M'20
Sales 5,941 5,008
Cost of sales (5,062) (4,411)
Gross Profit 879 597
Gross profit % 14.8% 11.9%
Marketing and sales expenses (46) (56)
General admin. Expenses (151) (171)
R&D Expenses (12) (14)
Operating profit 670 356
Other income / (expenses) 50 114
Financial income 1,174 1,298
Financial expense (1,385) (1,564)
Profit before tax 508 203
Income tax (44) (23)
Deferred tax (25) (45)
Net Profit / (loss) 439 135
Net profit % 7.4% 2.7%
Other 48 70
Depreciation 173 190
EBITDA 890 617
EBITDA % 15.0% 12.3%
13Herkese Açık / Public
PETKIM 2Q20 Balance Sheet
TL mn 12M19 6M20
Cash and cash equivalents 4,037 4,560
Trade receivables 1,552 1,334
Inventory 929 746
Other receviables 13 8
Other current assets 3,015 3,510
Current assets 9,547 10,159
Non current assets 5,255 5,581
Total Assets 14,801 15,739
Short term borrowings 4,037 3,741
Trade payables 957 636
Other payables 134 230
Current liabilities 5,129 4,607
Long term borrowings 4,487 5,812
Other non-current liabilities 337 416
Shareholders’ equity 4,849 4,904
Total liabilities 14,801 15,739
Net debt position -4,297 -4,766
Working Capital 27 -153
Days sales outstanding 49 45
Days payable outstanding 89 102
Days sales of inventory 34 29
14Herkese Açık / Public
4,316 4,739 5,164 4,766
2.83x 2.93x
3.55x 3.62x
0.00x
0.50x
1.00x
1.50x
2.00x
2.50x
3.00x
3.50x
4.00x
(500)
500
1,500
2,500
3,500
4,500
5,500
6,500
2018 2019 Q120 Q220
Net Debt Position (mn TL)
Net debt Position Net debt/EBITDA
118 100
21 19
40
28
2 1
2018 2019 Q120 Q220
CAPEX (mn US$)
Maintanance CAPEX Investment CAPEX
1,523 1,589
205 412
836 761
-10145
16%
14%
7%
18%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
(500)
-
50 0
1,000
1,500
2,000
2018 2019 Q120 Q220
EBITDA Net Income EBITDA Margin
EBITDA, Net Income and EBITDA Margin (mn TL)
5,7596,889
1,710 1,528
3,797
4,666
1,044685
2018 2019 Q120 Q220
Revenue (mn TL)
Domestic Sales Export
Financial Performance
15Herkese Açık / Public
Balance Sheet Analysis
Maturity Profile* (mn US$)
As the date of 30.06.2020;
• 85% of deposits are in US$, 10% of deposits are in TRY and the remainder 5% is in EUR.
• Petkim reported total debt of $1.349 billion of which $485 million was related short-term working facilities and letter of credits.
• Petkim utilizes short term credits for its working capital financing mostly from Eximbank with favorable terms.
• Long term loans include the U.S.$212 million project finance credit agreement. On 25 May 2015, Petlim signed a project finance credit agreement with Akbank, maturity of 13 years with 3 years grace period.
• In January 2018, Petkim successfully priced its inaugural $500mm 5.875% due 2023 bond offering.
US$667mn
*Consists of principal amounts, interest accruals of borrowings are excluded.
TRY10% EUR
5%
USD85%
Deposits - by currencyLoan Type Loan Type Currency
Outstanding
principial
(Original
currency)
Outstanding
principial
(USD)
Inv estment Credit EUR 33 37
Inv estment Credit USD 7 1 7 1
Project Finance Loan USD 1 89 1 89
Eurobond USD 500 500
Inv estment Credit TRY 7 0 1 0
Naphtha WC financing Murabaha USD 57 57
Total long-term loan USD 864
WC Financing TRY 1 3 2
WC Financing USD 230 230
WC Financing EUR 20 22
Naphtha WC financing Letter of Credits USD 94 94
Naphtha WC financing Murabaha USD 1 37 1 37
Total short-term loan USD 485
Total USD 1,349
Long-term loan
Short-term loan
US$500mn Eurobond is
expected to refin
389
116 112
559
33
109
2020 2021 2022 2023 2024 2025 andbeyond
Long term Eurobond Short term
16Herkese Açık / Public
Diversified business profile through ancillary infrastructure and energy investments
Description Benefits to Petkim
STAR
Refinery
• Turkey’s first privately constructed Refinery
• Target processing capacity of 10m tons p.a.
• Owned 60% by SOCAR Turkey, and 40% by Azerbaijan Ministry of Economy and Industry
• Total investment amounts to $6.3bn.
• Lower naphtha procurement costs
• Replacement of some of the heavy naphtha feedstock with Reformate / Mixed-xylene.
• Increased stability and quality of feedstock, supply security, and reduced inventory costs
• Upside from sharing services such as maintenance, safety, security, waste disposal and tug boat services
• STAR expected to become a stable dividend payer over the medium-term
Petlim
• Largest container sea port in Western Turkey with a 1.5m TEU container handling capacity
• Total construction costs amount to c. $400m
• Petlim has signed a 28-year (+4) concession agreement with Port Operator
• Owned 70% by Petkim and 30% by Goldman Sachs
• Stable stream of income that is not correlated to Petkim’s core business
• Savings on shipments for expansion projects
Windfarm
• Wind farm located in the Aliaga Peninsula licensed to generate 38 MW of electricity
Petkim has applied for a new license allowing generation at full capacity of 51 MW
• The construction of 17 new turbines, each able to generate 3 MW of electricity, was completed in Sep-2017
• Total investment in the windfarm amounts to €55m
• Contributes to revenue diversification
Plan is to sell the electricity generated to Turkey’s national grid, with a guaranteed tariff
• The windfarm provides a 22% increase in Petkim’s electricity generating capacity
• Expected to reduce carbon emissions by 120kt per year
17Herkese Açık / Public
Appendix 1. Petrochemical Complex Flow Chart
Naphtha Propylene
Aromatics
Ethylene
LDPE(350,000 ton/year)
HDPE(96,000 ton/year
MEG(89,000 ton/year
C4(140,000 ton/year)
PVC(150,000 ton/year)
PP(144,000 ton/year)
ACN(90,000 ton/year)
PA(49,000 ton/year)
Benzene(144,000 ton/year)
C5 Mixtures(80,000 ton/year)
P-X(136,000 ton/year)
PTA(105,000 ton/year)
Bag, greenhouse covers, film, cable, toys, pipes, bottles, hose, packaging
Construction and water pipes, packaging film, toys, bottles, soft drink crates, barrels
Polyster fiber, polyester film, antifreeze
Pipe, window shades, cable, bottles, building materials, packaging film, floor tiles, serum bags
Knitting yarn, ropes, tablecloths, napkins, doormats, hoses, radiator pipes, fishing nets, brushes
Textile fibers, artificial wool, ABS resins (acrylonitrile butadiene)
Detergent, solvents, explosives, pharmaceuticals, cosmetics, parts of white goods
Polyester industry
Polyester fiber, polyester resin, films, plasticizers, synthetic chemicals
Ethylene Plant
Aromatics Plant
Petkim has fully integrated operations
Chlor-alkali(100,000 ton/year)
18Herkese Açık / Public
Closing Price as of 30 June 2020 (TRY/Share) 4,27TL
Market Cap (TRY mn) TL 9,018
Free Float (%) 49.0%
PETKIM STOCK PERFORMANCE
Appendix 2. PETKIM Stock Performance
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
500,000
70
90
110
130
150
170
190
210
230
250
270
290
310
330
350
12/16 06/17 12/17 06/18 12/18 06/19 12/19 06/20
Volume Petkim BİST 100
Th Unit
19Herkese Açık / Public
This presentation does not constitute or form part of, and should not be construed as, an offer or invitation to subscribe for,underwrite or otherwise acquire, any securities of Petkim Petrokimya Holding A.Ş. (the “Company”) or any member of its group norshould it or any part of it form the basis of, or be relied on in connection with, any contract to purchase or subscribe for any securitiesof the Company or any member of its group nor shall it or any part of it form the basis of or be relied on in connection with anycontract, investment decision or commitment whatsoever. This presentation has been made to you solely for your information andbackground and is subject to amendment. This presentation (or any part of it) may not be reproduced or redistributed, passed on, orthe contents otherwise divulged, directly or indirectly, to any other person (excluding the relevant person’s professional advisers) orpublished in whole or in part for any purpose without the prior written consent of the Company.
Disclaimer
