IRPC Records THB300 Million of Profit in 1Q23 with THB1.7 Billion Inventory Loss and Declining Margin

IRPC Public Company Limited (SET: IRPC) has announced its 1Q23 consolidated financial statement through the Stock Exchange of Thailand as follows;

Year 1Q23 1Q22
Net Profit (Loss)
Million Baht
300.72 1,501.09
Earning Per Share
0.0100 0.0700
% Change -79.97

In 1Q23, IRPC reported a net profit of Baht 301 million, decreased by 80% from that in 1Q22.

The company’s net sales decreased by Baht 848 million or by 1% from that in 1Q22 due to a 13% decrease in average selling prices following lower crude oil price versus a 12% increase in sales volume. The average crude intake was 196,000 barrels per day rising by 1%.

The Market Gross Integrated Margin (Market GIM) increased by Baht 2,979 million or by 73%, mainly from the decline in the cost of crude premium as well as a rise in petroleum products spreads. There was a net inventory loss of Baht 1,742 million in 1Q23 compared to a net inventory gain of Baht 5,786 million in 1Q22. This led to Accounting GIM decline by Baht 4,549 million or by 46%. Meanwhile, the operating expenses dropped by 9%.

Therefore, EBITDA was Baht 2,020 million decreasing by Baht 4,580 million or by 69%. Furthermore, the Company recorded an unrealized gain on oil hedging of Baht 61 million compared to an unrealized loss on oil hedging of Baht 2,699 million in 1Q22, while gain on investment dropped by Baht 119 million or by 92%.

Compared to the previous quarter, the Market GIM was Baht 7,084 million or USD 11.80 per barrel rising by 172% following a decrease in the cost of crude premium as well as an increase in petrochemical products spreads.

The crude oil price in 1Q23 decreased from USD 84.85 per barrel in 4Q22 to USD 80.23 per barrel. This was mainly due to the recession concerns following bank crises in the U.S. and Europe during March 2023 though crude oil price in the first 2 months of this quarter increased following OPEC and allies’ production cut, the sanction on Russian petroleum products and rebounding China demand from China reopening. This led to the net inventory loss of Baht 1,742 million or USD 2.90 per barrel including the stock loss of Baht 3,763 million or USD 6.26 per barrel as well as a reversal on Net Realizable Value (NRV) of Baht 2,021 million or USD 3.36 per barrel.

Therefore, the Accounting Gross Integrated Margin (Accounting GIM) was Baht 5,342 million or USD 8.90 per barrel compared to the loss on Accounting GIM of Baht 4,207 million or USD 10.50 per barrel in the previous quarter.