Gulf Energy Development Public Company Limited

Transcription

1 Management Discussion and Analysis of the Company s Performance For the Third Quarter Ended September 30, 2018 The Management Discussion and Analysis of the Company s Performance (the MD&A ) is intended to present and analyze the Company s results of operations and financial position at the end of the accounting period. Such information may change in the future. The MD&A is primarily prepared in Thai. In cases where the content in the translation contains any conflict or is interpreted differently from the Thai version, the Thai version shall prevail. For questions or queries, please contact our Investor Relations Department: Tel: +66 (0) or ir@gulf.co.th

2 Definition Company Group EGAT EPC GBL GBP GJP GMP GNC GNS GPD GSRC GTS1 GTS2 GTS3 GTS4 Gulf HK Gulf SG GUT GVTP IPD IPP Mitsui PEA QoQ SPP TFRIC 4 YoY The Company, its subsidiaries, its associates and its joint ventures The Electricity Generating Authority of Thailand Engineering, procurement and construction Gulf BL Co., Ltd., a power project operator under the subsidiary of GMP Gulf BP Co., Ltd., a power project operator under the subsidiary of GMP Gulf JP Company Limited, an associate in which the Company has a 40.0% equity interest Gulf MP Company Limited, a subsidiary in which the Company has a 70.0% equity interest Gulf NC Co., Ltd., a power project operator under the subsidiary GMP Gulf JP NS Co., Ltd., a power project operator under the associate GJP Gulf PD Co., Ltd., a power project operator under the subsidiary of IPD Gulf SRC Co., Ltd., a power project operator under the subsidiary of IPD Gulf TS1 Co., Ltd., a power project operator under the subsidiary GMP Gulf TS2 Co., Ltd., a power project operator under the subsidiary GMP Gulf TS3 Co., Ltd., a power project operator under the subsidiary GMP Gulf TS4 Co., Ltd., a power project operator under the subsidiary GMP Gulf International Investment (Hong Kong) Limited, a subsidiary in which the Company has 100.0% equity interest, and registered in Hong Kong Gulf International Holding Pte. Ltd., a subsidiary in which the Company has an indirect shareholding of 99.99%, and registered in Singapore Gulf JP UT Co., Ltd., a power project operator under the associate GJP Gulf VTP Co., Ltd., a power project operator under the subsidiary GMP Independent Power Development Company Limited, a subsidiary in which the Company has a 70.0% equity interest Independent Power Producer in which capacity sold to EGAT is more than 90 megawatts Mitsui & Co., Ltd. The Provincial Electricity Authority Comparison of performance between this accounting period and the previous quarter Small Power Producer in which capacity sold to EGAT is more than 10 megawatts but not more than 90 megawatts Revenue recognition standard applied for the IPPs to record revenue from availability payment as income from financial lease Comparison of performance between this accounting period and the previous year 1

3 1. Executive Summary 1.1) Overview of key events in Quarter 3 of 2018 Investment in wind and solar power projects in Vietnam with total installed power generation capacity of 340 megawatts In August 2018, the Company entered into an investment holding 49% shares in two power projects located in Ben Tre province, Vietnam, namely a wind power project with an installed power generation capacity of 310 megawatts and a solar power projects with an installed power generation capacity of 30 megawatts. The Company expects the project cost of the two projects to be approximately USD 651 million. Combined with the two solar power projects in Tay Ninh province with a total installed power generation capacity of approximately 119 megawatts in which the Company holds 49% shares, an investment made in the previous quarter, this brings the Company s total investment in Vietnam to approximately 460 megawatts with a total project value of approximately USD 770 million. The details of each project are summarized in the table below. Project Province Fuel type Approx. installed capacity (MW) Equity installed capacity (MW) Project cost (million USD) SCOD TTCIZ-01 Tay Ninh Solar March 2019 TTCIZ-02 Tay Ninh Solar May 2019 Solar VN Ben Tre Solar June 2019 Wind VN Ben Tre Near-shore/Offshore wind Total Gulf BL power project begins commercial operation In September 2018, the Gulf BL power project (GBL), the 7 th gas-fired SPP developed as part of the 12 SPP program under the subsidiary, GMP, began commerical operation. The project is located in the Hi-tech Industrial Estate, Ayutthaya province, with an installed power generation capacity of megawatts and an installed steam generation capacity of 10.0 tons per hour of which 90.0 megawatts will be sold to EGAT under a 25-year PPA while the remaining power and steam will be sold to industrial users under long-term power purchase agreements. Investment in a gas-fired power project in Oman with an installed power generation capacity of approximately 326 megawatts On September 6, 2018, the Company entered into a joint venture with Oman Oil Company Limited S.A.O.C. ( OOC ) to invest in Duqm Power Company L.L.C. ( DPC ) in which the Company purchased 45% of shares from OOC to jointly develop a gas-fired power project with an installed power generation capacity of 326 megawatts and an installed water generation capacity of 1,667 cubic meters per hour ( Duqm Independent Power and Water Project or Duqm Power Plant ) located in the Duqm Special Economic Zone, Oman, to generate and sell power and water under a 25-year PPA to the Duqm Refinery and Petrochemical Industrial 2

4 Company L.L.C., a large-scale refinery with a crude oil production capacity of approximately 230,000 barrels per day. This refinery is owned by the Omani government through the OOC group and by the Kuwaiti government through the company, Kuwait Petroleum International ( Q8 ), with each party holding 50% shares. On October 28, 2018, the Company completed the payment of USD 8.75 million to the OOC group for the purchase of 45% of shares in DPC. The Duqm Power Plant is scheduled to reach commercial operation in stages from 2020 to Establishment of an overseas subsidiary to support the Company s overseas expansion On August 10, 2018, the Company s Board of Directors passed a resolution to establish Gulf Energy (Vietnam) Limited Liability Company ( Gulf Vietnam ) with a registered capital of VND 2,350 billion, equivalent to approximately USD 100,000, with the purpose of supporting the Company s business expansion and increasing its business efficacy in Vietnam. On September 13, 2018, the Company s Board of Directors passed a resolution to establish Gulf Energy Mauritius Company Limited ( Gulf Mauritius ) in the Republic of Mauritius with a registered capital of USD 100,000 as a holding company to invest in energy and/or other businesses, as well as to facilitate financial arrangements for companies under the Group in order to ensure overseas investments are conducted efficiently and maximize benefits to the shareholders. 1.2) Summary of the performance in Quarter 3 and the first nine months of 2018 The Group s performance Consolidated financial information 3Q 18 2Q 18 3Q 18 Change 9M 17 9M 18 Change M.Baht M.Baht M.Baht % YoY % QoQ M.Baht M.Baht % YoY Revenue from sales and service 1, , , % 10.9% 1, , % Profit for the period (554.1) 1, % N.A. 2, , % Profit attributable to owners of the parent (438.0) 1, % N.A. 2, , % Less: gain (loss) on exchange rate from subsidiary Less: gain (loss) on exchange rate from share of profit (loss) from an associate and joint ventures Profit attributable to owners of the parent before gain (loss) on exchange rate ( Core profit ) 93.7 (467.5) % N.A % (765.3) % N.A. 1, % % -5.1% 1, , % The Group earned revenue from an increase in sales and services of 10.9% QoQ and 195.2% YoY, respectively, with revenue in 9M 18 increasing 506.9% YoY as a result of the successive commercial operation of three power projects under the GMP group in 2018, namely GTS4 and GNC in Q1 and GBL in Q3. As of the end of 3Q 18, the Company has a total of 7 power plants in operation under the GMP group compared to 3 power plants in operation in the same period in the previous year. Net profit attributable to the Company in 3Q 18 was 1,205.2 million baht, a reversal from a net loss of million baht in the previous quarter as a result of SPP power plants under the GMP and GJP groups showing improved performance due to the increase in industrial users for both power and steam despite the SPP power projects in the group being affected by a 6% increase in the average natural gas cost in the previous quarter while the Ft rate remained the same. In addition, the Company recorded profit from exchange rates as a result of the appreciation of the Thai baht against the US dollar in 3Q 18 compared to 2Q 18. 3

5 Core profit in 3Q 18 was million baht, a decrease of 40.7 million baht or 5.1% QoQ mainly due to a decrease in share of profits from the GJP group resulting from a decrease in the availability payment QoQ from GUT power project due to lower availability payment rates in the rainy season in Q3 versus the summer season rates in Q2. In any case, the change in the availability payment rate during these seasons conforms to the conditions set out in the PPA with EGAT, where GUT will continue to receive the full availability payment for the year 2018 as set out in the PPA. For the GNS power project, there was an improvement in performance QoQ despite the same impact from the change in the availability payment rate because GNS performed planned maintenance in May 2018 while there was no scheduled maintenance in 3Q 18. For SPP power plants under the GJP group, there was an improvement in performance QoQ as a result of an increase in the new industrial users despite having planned maintenance of three SPP power projects (GKP1, GTLC and GNNK). Compared to 3Q 18, core profit increased million Baht or 131.4% YoY mainly due to increased realization of profits in line with the increase in the number of projects under the GMP group which achieved commercial operation as well as the improved performance of both the GMP and GJP groups, bringing the core profit to 2,304.7 million Baht in 9M 18, an increase of 1,287.1 million Baht or 126.5% YoY. 1.3) Progress of projects under construction and development The GBP power project, with an installed power generation capacity of megawatts and an installed steam generation capacity of 10 tons per hour, began commerical operation as scheduled on November 1, 2018 and the remaining four SPP projects under the GMP group which are under construction have progressed faster than planned, with all projects at about 85.0% % completed. Construction of the biomass SPP, with an installed power generation capacity of 25.0 megawatts, has progressed to approximately 25.0%. Construction on the two natural gas distribution pipeline ( NGD ) projects, which will distribute natural gas to industrial users in the Hemaraj Eastern Seaboard Industrial Estate, has progressed to approximately 58.0% %. The Company estimates that the first project, NGD 2, will begin commerical operation within December The solar power projects TTCIZ-01 and TTCIZ-02, located in Tay Ninh province, Vietnam, with a total installed power generation capacity of 119 megawatts, are progressing on schedule, with approximately 13.6% % of construction completed. The Group has entered into financing agreements with 12 domestic and foreign financial institutions to obtain long-term loan facilities to develop and construct the GSRC power project, with an aggregate amount totaling 38,000 million Baht, of which 50% is denominated in Baht and 50% is denominated in USD. The GSRC power project has commenced engineering and site preparation work on July 1, 2018 and will begin construction in December The gas-fired power project located in the Duqm Special Economic Zone in Oman, with an installed power generation capacity of 326 megawatts and an installed water generation capacity of 1,667 cubic meters per hour, commenced construction in August 2018 and is currently in the phase of site preparation and foundation work, with approximately 6.6% of construction completed. 4

6 2. Analysis of the Group s Results of Operations for the Third Quarter and the First Nine Months of 2018 The following table shows the Group s results of operations from the consolidated financial information. The Group s results of operations 3Q 17 2Q 18 3Q 18 Change 9M 17 9M 18 Change M.Baht M.Baht M.Baht % YoY % QoQ M.Baht M.Baht % YoY Revenue from sales 1, , , % 11.1% 1, , % Revenue from management fee % 0.0% % Cost of sales (1,117.9) (2,929.2) (3,304.7) 195.6% 12.8% (1,409.1) (8,718.2) 518.7% Cost of management fee (43.9) (53.1) (32.4) -26.2% -39.0% (144.7) (131.2) -9.3% Gross profit , , % 8.1% , % Other income % -14.1% % Interest income ,135.3% -44.6% % Dividend income % -23.9% % Share of profit (loss) from an associate and joint ventures (58.9) % N.A. 3, , % Administrative expenses (208.8) (397.9) (403.4) 93.2% 1.4% (679.7) (1,031.5) 51.8% Finance costs (397.1) (441.9) (448.7) 13.0% 1.5% (1,005.3) (1,361.0) 35.4% Corporate income tax benefits (expenses) (0.6) N.A. N.A % Gains (losses) on exchange rate (819.0) % N.A % Profit for the period (554.1) 1, % N.A. 2, , % Profit attributable to owners of the parent (438.0) 1, % N.A. 2, , % Less: gain (loss) on exchange rate from subsidiaries Less: gain (loss) on exchange rate from share of profit (loss) from associates 93.7 (467.5) % N.A % (765.3) % N.A. 1, % Profit attributable to owners of the parent before gain (loss) on exchange rate ( Core profit ) % -5.1% 1, , % 5

7 The following table shows the Group s revenue structure from the consolidated financial information. Revenue structure 3Q 17 2Q 18 3Q 18 Change 9M 17 9M 18 Change M.Baht M.Baht M.Baht % YoY % QoQ M.Baht M.Baht % YoY Revenue from electricity sold to EGAT and PEA 1, , , % 9.8% 1, , % Revenue from electricity sold to industrial users % 14.9% , % Revenue from steam sold to industrial users % 17.1% % Revenue from management fee % 0.0% % Share of profit (loss) from associate and joint ventures before effect from exchange rate % -7.2% 2, , % Dividend income % -23.9% % Interest income ,135.3% -44.6% % Other income % -14.1% % Total revenue from operations 2, , , % 7.2% 4, , % The following table shows volume of electricity and steam sold of the power projects under the subsidiary GMP. Power project Commercial operation date Volume of electricity sold (Gigawatt-hour) Volume of steam sold (Ton) EGAT Industrial users Industrial users 2Q 18 3Q 18 2Q 18 3Q 18 2Q 18 3Q 18 GVTP May 16, , GTS1 July 8, , ,495.5 GTS2 September 1, , ,170.5 GTS3 Novomber 1, , ,249.6 GTS4 January 1, , ,452.0 GNC March 1, , ,980.4 GBL September 1, ,137.6 Total , , ,464.1 Revenue from sales of electricity and steam of SPPs under GMP for the nine months ended September 30, 2018 GVTP 1,982.4 MB GTS1 2,118.1 MB GTS2 2,074.9 MB GTS3 1,937.3 MB GTS4 2,059.0 MB GNC 1,272.3 MB GBL MB 0.5% 5% 5% 3% 3% 2% 1% 25% 74% 24% 71% 22% 73% 20% 77% 24% 73% 9% 89% 29% 70% 6

8 Revenue from sales Revenue from sales in 3Q 18 was 4,383.3 million baht, an increase of million baht or 11.1% QoQ, as a result of the commencement of commercial operation of the GBL power project in September 2018 and the overall increase in sales of electricity and steam of the power projects under the GMP group in 3Q 18 due to the increased electility demand from both EGAT and industrial users and the increased steam demand from industrial users. Compared to 3Q 17, revenue from sales increase 2,917.7 million baht or 199.1% YoY as the Group recognized revenue from electricity sold to EGAT and revenue from electricity and steam sales to industrial users which increased in conjunction with the increase in the number of SPP power projects under the GMP group which began commerical operation. This increase aligns with the revenue from sales in 9M 18 of 11,688.4 million baht, an increase of million baht or 543.6% YoY. Revenue from management fee Revenue from management fee resulted from the Company s management of the associate, GJP, in 3Q 18. The Company received 75.0 million baht in management fee, equal to that received in 2Q 18 in accordance with the fixed management fee of 25.0 million baht per month. Compared to 3Q17, revenue from management fee increased 30.5 million baht or 68.5% YoY. Revenue from management fee in 9M 18 was million baht, an increase of 78.3 million baht or 53.4% YoY, as the Company adjusted its Secondment Agreement and entered into an additional Major Maintenance Agreement for power projects under the GJP group at the end of 2017, resulting in the Company recognizing increased revenue from management fee when compared with the same period of the previous year. Cost of sales Cost of sales in 3Q 18 was 3,304.7 million baht, an increase of million baht or 12.8% QoQ, as a result of the overall increase in electricity and steam sales by power projects under the GMP group in 3Q 18, a realization of cost of sales from the GBL power project which reached commercial operation on September 1, 2018 and an increase in average gas price in the same period from approximately baht per million BTU in 2Q 18 to approximately baht per million BTU in 3Q 18. Compared to 3Q 17, cost of sales increased 2,186.8 million Baht or 195.6% YoY resulting from an increase in sales of both electricity and steam from SPPs under GMP which gradually reached commercial operation. In addition, cost of natural gas increased from baht per million BTU in 3Q 17 to baht per million BTU in 3Q 18. Such increase in the cost of natural gas was in line with cost of sales in 9M 18 YoY, which is equal to 8,718.2 million baht, an increase of 7,309.1 million baht or 518.7% YoY. Cost of service Cost of service is the cost of management services that the Company provided to its associate, GJP. In 3Q 18, the Company s cost of service was 32.4 million baht, a decrease of 20.7 million baht or 39.0% QoQ, while the cost of service in 9M 18 was million baht, a decrease of 13.5 million baht or 9.3%, resulting from the Company s overall ability to more effectively manage personnel for the GJP group, leading to a decrease in the cost associated with such services. Gross profit The Group s gross profit in 3Q 18 was 1,121.3 million baht, an increase of 84.1 million baht or 8.1% QoQ. This increase resulted mainly from gross profit from the electricity and steam business, which increased 63.4 million baht. Although the Company was challenged by the increase in average gas price in 3Q 18 which resulted in a decrease in the gross profit margin from electricity and steam sales of 25.7% in 2Q 18 to 24.6% in 3Q 18, the Company was able to consistently increase its gross profit from electricity and steam 7

9 sales. In addition, the Company s improved its ability to manage its cost of service, resulting in gross profit from the management business increasing 20.7 million baht and an improvement in gross profit margin from management from 29.2% in 2Q 18 to 56.8% in 3Q 18. The Group s gross profit for 9M 18 was 3,063 million baht, an increase in 2,654.9 million baht or 649.0% YoY, resulting mainly from the successful commencement of commerical operation of four power projects from 4Q 17 to 3Q 18 and a consistent increase in the number of industrial users and volume of sales. Moreover, the gross profit margin from electricity and steam sales increased from 22.4% in 9M 17 to 25.4% in 9M 18. Other income Other income in 3Q 18 was 0.9 million baht, similar to the 1.0 million baht earned in 2Q 18, while in 9M 18, other income was 8.1 million baht, a decrease of 32.4 million baht or 80.0% YoY, as in 9M 17 the Group profited from the sale of investments available for sale totaling 19.0 million baht and received compensation from the EPC contractor for the delay in commercial operation of the GVTP and GTS1 power projects totaling 16.1 million baht. These are non-recurring items. The following table shows volume of electricity, steam and chilled water sold of the power projects under the associate GJP. 3Q 17 2Q 18 3Q 18 9M 17 9M 18 IPPs Volume of electricity sold (gigawatt-hour) GNS 1, , ,629.6 GUT , ,111.6 Total 2, , ,741.2 SPPs Volume of electricity sold to EGAT (gigawatt-hour) 1, , , , ,359.9 Volume of electricity sold to industrial users (gigawatt-hour) Volume of steam sold (ton) 66, , , , ,321.0 Volume of chilled water (refrigeration ton) 7,624, ,793, ,111, ,078, ,570,826.2 The following table shows share of profit from associate and joint ventures from the consolidated financial information. The Group s results of operations 2Q 17 1Q 18 2Q 18 Change 6M 17 6M 18 Change Share of profit from an associate and joint ventures Less: gain (loss) on exchange rate from share of profit (loss) from associates Share of profit from an associate and joint ventures before gain (loss) on exchange rate ( Core profit ) M.Baht M.Baht M.Baht % YoY % QoQ M.Baht M.Baht % YoY (58.9) % N.A. 3, , % (765.3) % N.A. 1, % % -7.2% 2, , % 8

10 Share of profit from an associate and joint ventures The Group s share of profit from an associate and joint ventures, after adjustment of TFRIC 4, in 3Q 18 was million baht, which, after subtracting gain on exchange rate, was million baht, a decrease of 51.0 million baht QoQ. Such decrease was mainly due to a decrease in share of profit from the GJP group resulting from a decrease in the availability payment QoQ from GUT power project due to lower availability payment rates in the rainy season in Q3 versus the summer season rates in Q2. In any case, the change in the availability payment rate during these seasons conforms to the conditions set out in the PPA with EGAT. For the GNS power project, there was an improvement in performance QoQ despite the same impact from the change in the availability payment rate because GNS performed planned maintenance in May 2018 while there was no scheduled maintenance in 3Q 18. For SPP power plants under the GJP group, there was an improvement in performance QoQ as a result of an increase in new industrial users, despite having planned maintenance of three SPP power projects (GKP1, GTLC and GNNK). Compared to 3Q 17, the Group s share of profit from an associate and joint ventures increased of million Baht, up 15.1% YoY owing to GNS has scheduled maintenance in 3Q 17 while there was no scheduled maintenance in 3Q 18. In addition, the overall performance of 7SPPs was also improved in 3Q 18. Likewise, in 9M 18, the Group s share of profit from an associate and joint ventures, after adjustment of TFRIC 4, was 2,178.6 million baht which, after subtracting gain on exchange rate, was 2,056.5 million baht, an increase of 35.0 million baht or 1.7% YoY. Administrative expenses Administrative expenses in 3Q 18 were million baht, a slight increase of 5.5 million baht or 1.4% QoQ, resulting from the increase in consulting fees for development of future projectscompared to 3Q 18, administrative expenses increased million baht or 93.2% YoY, as the Company incurred increased personnel expenses from power projects under the subsidiary GMP which are under construction and from the increase in consulting fees for development of future projects and advertising and marketing expenses. Likewise, in 9M 18, administrative expenses were 1,031.5 million baht, an increase of million baht or 51.8% YoY. Finance costs Finance costs in 3Q 18 were million baht, a slight increase of 6.8 million baht or 1.5% QoQ, resulting from the commencement of commercial operation of the GBL power project in September 2018 leading to the Company recording increased finance costs. Compared to 3Q 17, finance costs increased 51.6 million baht or 13.0% YoY as a result of the increase in loans from financial institutions for construction of power projects under the GMP group and a change in the method of recording interest expenses from capitalized assets to finance costs for power projects which began commercial operation, despite the Company having paid off loans in December 2017 and January This aligns with finance costs in 9M 18, which were 1,361.0 million baht, an increase of million baht or 35.4% YoY. Gain (loss) on exchange rate As loans for the power projects under the GMP group were denominated in foreign currencies, resulting in the Company recognizing a gain (loss) on exchange rate due to the change in the exchange rate of the Thai baht against the US dollar where the exchange rate at the end of 3Q 17, 2Q 18 and 3Q 18 was , and baht to the US dollar, respectively, leading to the Company making a gain on exchange rate in 3Q 18 of million baht, a reversal from loss on exchange rate of million baht in 2Q 18 and an increase in gain on exchange rate in 3Q 18 of million baht. 9

11 Profit attributable to owners of the parent Net profit attributable to the Company in 3Q 18 was 1,205.2 million baht, a reversal from a net loss of million baht in the previous quarter as a result of SPP power plants under the GMP and GJP groups showing improved performance due to the increase in industrial users for both power and steam despite the SPP power projects in the group being affected by a 6% increase in the average natural gas cost in the previous quarter while the Ft rate remained the same. In addition, the Company recorded (unrealized) profit from exchange rates as a result of the appreciation of the Thai baht against the US dollar in 3Q 18 compared to 2Q 18. Core profit in 3Q 18 was million baht, a decrease of 40.7 million baht or 5.1% QoQ mainly due to a decrease in share of profits from the GJP group resulting from a decrease in the availability payment QoQ from GUT power project due to lower availability payment rates in the rainy season in Q3 versus the summer season rates in Q2. In any case, the change in the availability payment rate during these seasons conforms to the conditions set out in the PPA with EGAT, where GUT will continue to receive the full availability payment for the year 2018 as set out in the PPA. For the GNS power project, there was an improvement in performance QoQ despite the same impact from the change in the availability payment rate because GNS performed planned maintenance in May 2018 while there was no scheduled maintenance in 3Q 18. For SPP power plants under the GJP group, there was an improvement in performance QoQ as a result of an increase in the new industrial users despite having planned maintenance of three SPP power projects (GKP1, GTLC and GNNK). Compared to 3Q 18, core profit increased million Baht or 131.4% YoY mainly due to increased realization of profits in line with the increase in the number of projects under the GMP group which achieved commercial operation as well as the improved performance of both the GMP and GJP groups, bringing the core profit to 2,304.7 million Baht in 9M 18, an increase of 1,287.1 million Baht or 126.5% YoY. 10

12 3. Analysis of the Group s Financial Position as of September 30, 2018 Financial position As of Dec 31 As of Sep Change Cash and cash equivalents and deposits in financial institutions used as collateral M.Baht M.Baht M.Baht % 20, ,232.6 (5,166.6) -25.3% Trade accounts receivable 1, , , % Investments in an associate and joint ventures 20, , , % Advance payments for land and power plant construction 1, , % Property, plant and equipment, net 50, , , % Other assets 7, , , % Total assets 100, , , % Accounts payable for power plant construction 2, ,235.8 (970.9) -44.0% Short-term interest-bearing debts 3, , , % Long-term interest-bearing debts 53, ,011.0 (2,886.6) -5.4% Other liabilities 2, , % Total liabilities 61, , , % Issued and paid-up capital 10, , % Share premium 20, , % Unappropriated retained earnings 1, , , % Other components of equity 1, , % Total equity attributable to owners of the parent 34, , , % Non-controlling interests 4, , , % Total equity 39, , , % Assets Total assets as of September 30, 2018 was 107,770.8 million baht, an increase of 7,118 million baht or 7.1% from the end of the 2017 period, resulting from the following factors: The increase in property, plant and equipment, net of 9,382.6 million baht due to the development and construction of gas-fired SPP power projects under the GMP group. This increase in assets resulted partially from the investment of cash in the construction of power projects, leading to a decrease in cash and cash equivalents of 5,631.8 million baht. The increase in advance payment for land and power plant construction of million baht resulting from the GSRC power project under the IPD group having made an advance payment for engineering and construction work. 11

13 Liabilities Total liabilities as of September 30, 2018 was 63,632.9 million baht, an increase of 2,329.2 million baht or 3.8% from the end of the 2017 period. This increase mainly resulted from the increase in long-term loan drawdowns in the first nine months of 2018 for the construction of power projects under the GMP group. Equity Total equity as of September 30, 2018 was 44,127.8 million baht, an increase of 4,789.6 million baht or 12.2% from the end of the 2017 period, resulting from two main factors: 1) An increase in non-controlling interests of Mitsui caused by a call for the capital increase for the GMP and IPD groups in proportion with shareholding and the recognition of net profit from power projects under the GMP group, resulting in an increase in non-controlling interests of 3,165.2 million baht. 2) An increase in the Group s net profit, resulting in unappropriated retained earnings of 1,525.2 million baht. As of September 30, 2018, debt to equity ratio of the Group was 1.44 times. 12