PTTEP Q1 2025 presentation: Stable performance amid strategic expansion

Introduction & Market Context

PTT Exploration (OTC:PEXNY) and Production PCL (PTTEP) presented its Q1 2025 financial results and strategic outlook during an analyst meeting on April 28, 2025. The presentation highlighted the company’s stable performance amid ongoing strategic expansion efforts, as PTTEP celebrates its 40th anniversary as Thailand’s National Oil Company.

The company operates in a complex energy landscape shaped by competing priorities of energy security, technological advancement, and climate commitments. PTTEP’s strategy focuses on balancing these factors while maintaining its position as a key energy provider in the region.

As shown in the following strategic overview, PTTEP is navigating multiple industry challenges while pursuing growth opportunities:

Quarterly Performance Highlights

PTTEP reported a net profit of $488 million for Q1 2025, representing a decrease from $539 million in Q4 2024. However, profit from normal operations showed a 2% year-over-year increase, despite being down quarter-over-quarter. The company attributed the quarterly decline primarily to lower sales volume, a reduced liquid portion in its production mix, and higher depreciation, depletion, and amortization (DD&A) expenses.

The following chart illustrates PTTEP’s profit comparison across recent quarters:

Total (EPA:TTEF) production volume for Q1 2025 reached 484,218 barrels of oil equivalent per day (BOED), with a weighted average sales price of $45.74 per barrel of oil equivalent (BOE). The company maintained a strong EBITDA margin of 72% during the quarter, demonstrating operational efficiency despite market fluctuations.

PTTEP’s unit cost increased slightly to $30.77/BOE in Q1 2025 compared to $29.32/BOE in Q4 2024, primarily due to higher DD&A expenses. The breakdown of unit costs is detailed in the following chart:

The company’s financial position remains robust, with cash flow from operations of $3,938 million and ending cash of $4,144 million as of March 2025. PTTEP maintains a conservative debt-to-equity ratio of 0.25, with 100% fixed-rate debt, providing financial stability in a potentially volatile interest rate environment.

Strategic Initiatives

PTTEP’s long-term strategy centers on ensuring energy security as Thailand’s National Oil Company while pursuing international growth opportunities. The company is focusing on three key gas corridors—Eastern, Western, and Southern—to support its production targets.

The company forecasts production volume to reach 716,000 BOED in 2025, with a compound annual growth rate (CAGR) of 2-3%. This growth strategy is illustrated in the following strategic roadmap:

PTTEP’s portfolio is geographically diverse, with operations spanning Thailand (68% of sales), Southeast Asia (21%), the Middle East (10%), and Africa (1%). The company is actively developing major projects across these regions to sustain and grow production.

Key development projects include additional stake acquisition in Sinphuhorm and Arthit CCS in Thailand, Malaysia Greenfield in Southeast Asia, Ghasha Concession and Abu Dhabi Offshore 2 in the Middle East, and projects in Algeria and Mozambique in Africa.

Forward-Looking Statements

For Q2 2025, PTTEP forecasts sales volume of 500-505 thousand BOED, with full-year 2025 projections of 505-510 thousand BOED. The company expects gas prices to remain stable at approximately $5.8/MMBTU for both Q2 and the full year 2025.

Unit costs are projected to remain around $30/BOE, with EBITDA margins expected to stay strong at 70-75%. These projections reflect PTTEP’s confidence in maintaining operational efficiency while pursuing growth initiatives.

The company’s strong financial outlook is supported by solid credit ratings from major agencies, including BBB+ (Stable) from S&P Global and Fitch, Baa1 (Stable) from Moody’s, and AAA (Stable) from TRIS.

Diversification & Sustainability

As part of its long-term strategy, PTTEP is diversifying beyond traditional exploration and production activities. A significant step in this direction is the acquisition of a 25.5% stake in the Seagreen Offshore Wind Farm, which has a total capacity of 1.1 GW. The acquisition was completed on May 31, 2024, marking PTTEP’s entry into renewable energy production.

The company has also established AI and Robotics Ventures to enhance operational efficiency and develop new technological capabilities. These initiatives align with PTTEP’s strategic pillars of driving value, decarbonizing operations, diversifying the business portfolio, and enabling future growth.

On the sustainability front, PTTEP has committed to achieving net-zero emissions by 2050. The company’s decarbonization strategy includes improving operational efficiency, implementing carbon capture and storage (CCS) technology, and investing in renewable energy projects.

PTTEP’s balanced approach to energy security, financial stability, and sustainability positions the company well for navigating the evolving energy landscape while delivering value to shareholders in the coming years.

Full presentation:

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