Gulf Energy Development Public Company Limited (SET: GULF) reported the financial results of Q4’21 with core profit of THB2,728 million, an increase of THB1,488 million or 120% year-on-year (YoY). The growth mainly came from the commercial operation of Gulf SRC’s (GSRC) first unit and second unit (installed power generation capacity of 1,325 MW) in March and October 2021, respectively. The rise in core profit also came from a share of profit of THB1,093 million from Intouch Holdings Public Company Limited (INTUCH). In Q4’21, GULF recorded net profit of THB3,043 million, an increase of 65% YoY, compared to THB1,844 million in Q4’20.
In 2021, GULF recorded total revenue of THB52,870 million, an increase of 48% YoY, and core profit of THB8,812 million, an increase of 97% YoY, compared to THB4,478 million in 2020. The growth came from the dividend income of THB2,349 million from INTUCH plus a share of profit of THB1,093 million following the change in accounting treatment of the investment in INTUCH to equity method since Q4’21. The rise in core profit also came from the commercial operation of new power plants including GSRC (first unit and second unit); the gas-fired power plant in Oman (DIPWP) Phase 1 with an installed capacity of 40MW, which started the commercial operation in December 2021; the full-year revenue recognition of 465-MW Borkum Riffgrund 2 offshore wind power project (BKR2) in Germany; and a full-year share of profit from PTT Natural Gas Distribution Company Limited (PTT NGD).
The 12 SPPs under GMP group also had a higher volume of electricity sold to the Electricity Generating Authority of Thailand (EGAT) and industrial customers, especially from the electronic components, the automotive and packaging sectors, despite the maintenance of four power plants. The average load factor of industrial customers under GMP group in 2021 was 60% compared to 56% in 2020 while the 7 SPP power plants under GJP group had higher volume of electricity sold to industrial customers, with the average load factor of 64% compared to 60% in the previous year, reflecting the rebound in electricity demand of industrial customers across all sectors.
Gross profit margin for this year was 27.3%, a slight decrease from 27.6% in 2020 due to the rise in natural gas costs by 9%, from 244.51 THB/MMBTU to 266.02 THB/MMBTU, while the average Ft rate decreased by 29% from the previous year, from -0.1188 THB/kWh to -0.1532 THB/kWh. However, since GULF sells 86% of its electricity to EGAT, in which the cost of natural gas is passed through to EGAT, while sales to industrial customers account for only 14% of GULF’s electricity sales, there was limited impact from the spike in natural gas prices. GULF’s EBITDA margin was 41.9% in 2021 compared to 37.6% in 2020 on account of the dividend income from INTUCH.
In 2021, GULF recorded net profit attributable to the parent company, which includes the impact from foreign exchange rate, of THB 7,671 million, an increase of 79% YoY from the better performance as mentioned previously.
As of December 31, 2021, GULF had a net interest-bearing debt to equity ratio of 1.77 times, an increase from 1.47 times at the end of 2020. This was due to the drawdown of loans from financial institutions for the construction of two IPP power plant projects, GSRC and Gulf PD (GPD), with total installed power generation capacity of 5,300 MW. GULF also issued debentures of THB 30 billion for partial loan repayment for the acquisition of INTUCH shares. Nonetheless, the net interest-bearing debt to equity ratio is still below the bond covenant level of 3.50 times, providing room for potential investments by more than THB100 billion.
Ms. Yupapin Wangviwat, Chief Financial Officer, revealed that total revenue for 2022 is expected to grow approximately 60% from 2021 due to the commercial operation of GSRC’s third unit and fourth unit in March and October 2022, respectively, with a total installed capacity of 1,325 MW; Mekong Wind offshore wind power project in Vietnam, which is scheduled for commercial operation within Q2’22 with an installed capacity of 128 MW; and solar rooftop projects under GULF1 with a total installed capacity of 100 MW which will gradually commence operation by the end of this year. All of this will increase GULF’s gross installed capacity from 7,875 MW in 2021 to 9,422 MW in 2022. In addition, this year, GULF will record full-year profit from GSRC’s first and second units and DIPWP project Phase 1 in Oman, together with the full-year share of profit from the investment in INTUCH.
“GULF recognizes the importance of decarbonization, which is in line with the government’s policy towards clean energy. We will therefore emphasize investment in renewable energy business including hydroelectric power projects in Laos, solar farm projects and wind power projects, both in Thailand and overseas. Moreover, GULF has expanded the business into digital infrastructure, which focuses on investment in digital transformation, such as data center business development, cloud computing and blockchain technology businesses. These technologies have substantial impact on our daily lives and become more important in economic activities, driving the nation’s society and economy to grow exponentially as well as providing new business opportunities for the Company,” Ms. Yupapin concluded.
Additionally, the Board of Directors has resolved to propose to the 2022 Annual General Meeting of Shareholders to consider and approve the dividend payment from the Company’s operating results for the year ended December 31, 2021 to shareholders at the rate of THB 0.44/share or equivalent to the dividend payout ratio of 88%. The date to determine names of the shareholders who would be entitled to the dividend (Record Date) is on March 7, 2022, with the dividend payment date on April 28, 2022. The ex-dividend date (XD) is March 4, 2022, while the 2022 Annual General Meeting of Shareholders is to be held on April 8, 2022.
