SET Opportunity Day 4Q21

1. How much will the revenue target for 2022 grow from 2021 and what is the direction of the performance during Q1/22?

Most of OR's revenue (90%) comes from the Mobility business, which varies with the level of oil prices and oil sales volume. From the preliminary assessment, it is expected that the average oil price level in 2022 will be higher than that of 2021, and in terms of sales volumes, it is expected tobe growing in line with the country's GDP. At present, Q1/22, the picture is not clear. We'll have to wait for some more time to collect information

2. How much is the investment budget in 2022 and how is it used?

Investment budget for the year 2022 - 2026, approximately 93,500 million baht (only in 2022, about 26,900 million baht), with investment plans divided by business as follows

Mobility: Mainly for expanding PTT stations and focusing on investment in clean energy, including EV Charging station both inside and outside PTT stations, including investment in solar rooftop. Lifestyle : Most for expanding Cafe Amazon and Other F&B brands, and for other investment opportunities.

Global : Mainly for expanding of PTT stations and Cafe Amazon overseas, including searching for business opportunities through partners abroad for joint investments.

OR Innovation : Investing through venture capital and ORZON Ventures to seek business opportunities to extend the existing business, including the search for new S-Curve. Other: Investments in various infrastructures such as IT systems

3. How can rising oil prices have a positive or negative impact on OR?

OR operates in mobility business, which has a cost plus business model and has a relatively stable gross profit in the range of 0.70 - 1.30 baht per liter. Thus, this may affect OR but not much. OR also has a risk management policy in regards to oil prices to reduce the impact as well.

4. Expansion plan for EV charging stations in 2022

In 2022, OR plans to expand 350 additional EV charging stations, divided into 200 inside service stations and 150 outside service stations

5. What is the impact of government control measures to OR?

OR helped alleviate the burden of the public sector from the pressure from high oil prices in the world market. As a result, there has been a delay in the price adjustment of diesel at service stations in the past, resulting in a slight weakening of OR's marketing margin.

6. Has the price of coffee beans increased or not? And how will it affect the cost of Café Amazon business? How much coffee beans does the company have to support the expansion of Cafe Amazon outlets?

As OR coffee beans are sourced 100% locally, they are not based on global market price, and it is done thorugh a bidding process in which a pre-contract is signed. Therefore, the rise in coffee bean prices has increased costs to some extent, but at present, OR has been able to maintain its EBITDA margin at a reasonable level. However, the situation was closely monitored.

As for the consumption of coffee beans of cafe amazon is expected to be in line with the amount of domestic production, and at present, OR is looking for ways to increase the amount of coffee beans, for example, with the Royal Project Foundation by providing local farmers with knowledge and support on cultivation of quality coffee beans in order to build strong communities, including expanding the area for coffee beans cultivation and adding green space for sustainable growth.

7. In the presentation, the 2022 oil price forecast averages 78.6 USD/BBL. From the situation of the Ukraine-Russia war, has the company re-evaluated the world oil price and how it affects the business direction?

Oil prices are expected to rise. The projected oil price in 2022 is approximately 107 USD/BBL. OR's business is a cost-plus business model, so OR will not be too much affected by the oil price increase. However, the government's request for cooperation in supporting the retail fuel prices at the service stations will result in a slight weakening of the marketing margin. In addition, the rising oil prices will also affect the Lifestyle business as it affects the inflation rate and the purchasing power of consumers may decrease.

8. What is the average sales per branch for Café Amazon?

Average sale per day per store in 2021 was at 15,158 baht, an increase of 9.8% from 2020 at 13,803 baht.

9. How does the company plan to manage the marketing margin during the rising oil prices?

OR operates a Mobility business using the cost-plus business model. Therefore, OR's marketing margin is not much affected by an increase or decrease in oil prices. On average, OR's marketing margin will be approximately 1 baht per liter or slightly above or below this number.

SET Opportunity Day 3Q21

1. OR’s position and direction in the EV industry

OR is aware of the rapid changes in today's world, whether it is technology and the importance of clean energy. OR, a flagship company in the PTT Group, will play a role as the Marketing Arm in the EV ecosystem for the PTT Group. OR is well prepared to support the business transition from Oil to EV, as has studied EV business trends as long with government policies. At present, OR has installed EV chargers in 31 stations at the end of 3Q21 and will expand to 97 stations at the end of 2021 and 300 stations by 2022, respectively. OR also has an EV application to meet the needs of consumers from searching for EV Charging Stations in areas close to the customer’s location, booking service time, checking the charging status, offering various payments, etc.

In addition to EV charging at ptt stations, OR also installs EV charging posts outside service stations. In the future, our FIT Auto will also provide EV maintenance services as well.

In this regard, OR is ready to meet the needs of all types of motorists—both of those who want to use oil and those who want to use other types of energy in the future. OR will continue to maintain its leadership in the oil ecosystem and expand our business to the energy solution ecosystem to meet all the needs of motorists.

2. Does OR have plans to use cryptocurrency?

We currently are conducting feasibility study on the matter. Nonetheless, this is subject to strict compliance with the rules and regulations of the government and related agencies.

3. Growth direction of 4Q/21 compared to 3Q/21

Several positive factors that may contribute to the outlook for 4Q/21 include the reopening of international borders, improvement of the COVID-19 situation in Thailand, progress in the COVID-19 vaccination, end-of-year holidays season where people would spend and travel during the long holidays, and increasing foreign tourists, which will contribute to an increase for both oil and non-oil sales. However, there is still downward pressure from increasing global oil prices that may softens oil retail gross profit/liter.

Furthermore, Thailand and the world still face the uncertainty of the new Omicron variant, but OR has a business response plan regarding such uncertainty through our Business Continuity Management (BCM) plan.

4. Trend of oil retail gross profit/liter in 4Q/21 compared to 3Q/21 and what should be the appropriate range for the business?

Gross profit per liter in 4Q21 is likely to weaken compared to 3Q21

The appropriate GP/liter range for OR is around 0.80-1.30 baht per liter.

5. What is the direction of crude oil prices? Projected oil sales volume and revenue target for 2022?

For crude oil price trends in 2022, PTT Group projects the average Dubai crude oil price in 2022 to be around 65 USD/BBL

In this regard, PTT Group regularly reviews estimates to ensure they are in line with the current situation

For oil sales volume in 2022, it is expected to recover due to the government’s policy to open the country (Thailand) starting 1st November compared to Pre-COVID-19 level, except for aviation fuel, which is expected to increase by 50% next year compared to the pre-COVID-19 level.

6. Details of the investment budget and M&A plan for 2022?

OR constantly looks for investment opportunities and synergies with startups and SMEs to extend our strengths, including PTT station network across the country, as well as non-oil businesses such as Cafe Amazon and other F&B brands with strong potential across the country. We are continually making joint investments to diversify our F&B portfolio. In the future, OR will expand our business into the Health & Wellness and Tourism sectors, which can be linked to core businesses and current customers such as organic food, fitness, etc. OR wants to go beyond the oil business while growing together with partners, society, community and the environment

As for the 2022 investment plan, it is in the process of receiving the board’s approval this month (Dec’21)

7. Size and details of deal(s) that ORZON will invest in.

The details cannot be disclosed at this time. The deal must be closed completely first. ORZON has a policy to invest in startups during the early stage by focusing on new businesses under the Mobility & Lifestyle framework such as Smart Retail, Mobility, Energy, F&B, Travel, Health and Wellness and Information Technology to expand OR's business

8. International expansion plan for existing international countries and new countries?

In 2021, the international business segment has the plan to expand 43 service stations and 46 Cafe Amazon outlets. There are also 5 branches of CVS stores under the Jiffy brand.

OR currently has a presence in 10 countries. When expanding into new countries OR will leverage its strong brand, expertise and well-accepted reputation, and adjust accordance with the needs of the market in each country, including seeking suitable opportunities for acquisitions (M&A) and/or joint ventures (JVs) in foreign countries. Countries that we are interested in and are in the process of studying business opportunities, for example, Indonesia.

9. OR’s source of fund & any plan to raise fund in 2022?

OR received funding from our IPO, and we plan to use the money to expand the oil and non-oil outlets both domestically and internationally. There is also cash flow received from operations, which will be used for M&A’s and Joint Venture.

At the present, OR has no plans to raise additional funds.

1. Has OR been affected by the weakening of Thai baht?

Most of OR's business transactions occur in the country. Consequently, OR's transactions using foreign currency are rare, below 10%, and there are no foreign currency loans. Therefore, the effect of FX on OR is relatively small. Moreover, OR offers foreign exchange risk service, closing more than 90% of the risk of trading transactions.

2. How is the performance of oil sales volume in the third quarter? What would be the projection on OR's performance for the second half of the year, including how much growth is forecasted for this year's performance?

OR's performance was primarily in line with the country's growth rate. In the third quarter, economic activity was curtailed, lockdown was concentrated in some areas. Oil sales volume declined in the range of approximately 10% compared to the previous quarter. As for the projection on OR's performance in the second half of the year, if measures are relaxed and the city is opened for tourists, then business-related activites are likely to recover. However, there are still many challenges, such as when herd immunity can be reached and how well infection is controlled.

3. Can OR provide details about the bakery plant, and help explain the benefits of this plant to OR's business?

Currently, OR sources bakery from SMEs to sell in our Café Amazon stores. Therefore, having our own bakery plant and products in the stores will lead to product standardization, quality control, and cost control, which create an opportunity for OR to maintain our desired margins level in the long term. OR also aims to increase our ticket size through the non-drink portion from 9% to 13% in the medium term. We believe that the bakery plant will help drive us to reach our performance goal. Nonetheless, OR continues to focus on growing together with SMEs, and the bakery will supply 30-40% of all products in Café Amazon.

4. How does higher oil prices help OR? Isn't this a cost pass through business where you only make money from higher volumes?

The oil retail price is a cost-plus model. The higher oil price does not directly translate to the margins we receive. Our oil margin is in the range between THB 0.80-1.20/litre. We recommend investors include inventory gain / loss when deriving our margin because it's one of the factors we consider when we adjust the pump price.

5. For inorganic growth, which food business niche would you find interesting? (Meat substitutes like beyond meat)

We have many deals, both F&B and non F&B businesses, which are under discussion. We are open to exploring all opportunities related to the mobility and lifestyle ecosystems.

6. Is there any chance for us to acquire small electric vehicle battery technology to speed up our EV BUSINESS?

Currently, the adoption of EVs is still low. According to the Electric Vehicle Associate of Thailand, the number of battery EVs and Hybrid EV/Plug-in Hybrid EV account for less than 2% of the total registered passenger cars in Thailand. We closely monitor the growth of EV technology and believe that we are well-prepared to meet future demand. We also look for partnerships for the EV charging technology to strengthen our mobility platform. We also developed mobile application for our EV charging station, which provides convenience for our customers in locating our EV stations while allowing us to study the behavior of EV users.

7. How has OR been following the trend for new S-Curve businesses?

OR's investment strategy includes investing in businesses relating to and/or meeting the needs of Mobility and Lifestyle to build on our current business and investing in businesses with an emphasis on technology. Investing in Flash Group that operates a logistics and parcel delivery business, is one example of a new S-curve business that helps increase traffic at our PTT stations while also creates synergy in other aspects with OR. In addition, the investment in Care for Car and Orbit Digital are investments for the development of various platform applications to expand our current business.

8. Can you describe how OR manages its PTT stations to embody the concept of one-stop-service, and how will this help increase revenue in the long term, and what will the proportion of increase look like?

We offer a mix of products & services that aims at meeting the needs of consumers. Ensuring they can enjoy the non-oil services available at our stations while refueling and charging their vehicles at the same time. As for the outlook on long-term revenue increase, our current revenue for the space rental business comes in the form of GP sharing.

9. Is there enough coffee beans as OR expands hundreds of Café Amazon outlets each year?

OR source 100% of our coffee beans locally and believes that from the amount of coffee beans produced in the country per year compared to the coffee demand from Café Amazon outlets, we will be able to support our current and future Café Amazon outlets in the medium term, which is 3-5 years into the future.

10. Please provide an update on your use of proceeds from the IPO and OR's plan for M&A. Are there any progress and whether there will be any deal announcements this year?

OR has set up a 5-year CAPEX plan of 74,600 million THB with the following breakdown: 34.6% oil business, 28.6% non-oil business, 15% foreign business, and 15% other business (new S-Curve) 15%. OR will be focusing on the non-oil business segment, which provides high margins.

If OR can invest according to this 5-year CAPEX plan, the proportion of OR's EBITDA contribution from each business segment will change to the following: Oil business at approximately 50 - 52%, Non-oil business at about 30 - 33%, International business at about 13-15% and other business (New S-Curve) at roughly 5%.

For this year's M&A deals and investment plan, we’re currently still under discussion and cannot disclose such information.

11. What are management's plans for domestic and international JVs in the retail business?

For domestic JVs in the non-oil business, we have discussions and plans to invest mainly in F&B. For international JVs, there are both F&B and Non-F&B.