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Issuer Flash: PTT Global Chemical 1Q2026 Results

Issuer Flash: PTT Global Chemical 1Q2026 Results

Report date: 2026-05-06 Event date: 2026-05-05 Event title: Q1 2026 Results

1. Flash Conclusion

PTT Global Chemical (PTTGC, GC)’s 1Q2026 results are modestly positive from a credit perspective, but should still be read not as confirmation of a full-fledged recovery, but as a strong temporary rebound from a loss-making phase. The company reported revenue of THB 146,936 million, EBITDA of THB 13,977 million, Adjusted EBITDA of THB 14,846 million, and net profit attributable to owners of the parent of THB 3,232 million in 1Q2026. This was a large improvement from 4Q2025 revenue of THB 92,143 million, Adjusted EBITDA of THB 4,239 million, and a net loss of THB 5,502 million, and marks clear progress on the end-2025 issue that “Q1 had not yet been disclosed and the recovery hypothesis remained unproven.”

However, the substance of the results was not simply a straightforward operating recovery. The company recognized stock gain / NRV of THB 7,182 million, commodity hedging loss of THB 7,991 million, net gain from foreign exchange and financial derivatives of THB 1,011 million, and a THB 3,300 million gain from the partial sale of Thai Tank Terminal (TTT) shares and the restructuring of the jetty and tank farm, while also booking impairment and business restructuring provisions related to GCP, GCA, and PTTMCC totaling THB 6,561 million. Net income turned positive, but volatile one-off and market-linked items were also large. Therefore, for credit assessment, more weight should be placed not on the net profit turnaround itself, but on the recovery in Adjusted EBITDA to THB 14,846 million, the improvement in Upstream and Performance Chemicals, and the strengthening of liquidity to THB 56,685 million.

The conclusion for bond investors is that the weight of the Negative outlook has eased somewhat, but has not yet been removed. GC maintains its funding capacity and business platform as PTT Group’s strategic chemicals company, and Q1 benefited from the convergence of normalized operations, petroleum product spreads, olefins prices, and the seasonal recovery at allnex. At the same time, many of the drivers were low-repeatability factors, including price and supply tightness caused by the Middle East conflict, stock gains, and the TTT disposal gain. Unless we see the extent to which crude premium, logistics costs, stock losses, and renewed petrochemical spread compression appear from 2Q2026 onward, it is too early to front-run rating stabilization.

2. What Was Announced

The company’s IR Financial Statements and MD&A page posted the Financial Statement Quarter 1/2026 (Reviewed) and Management Discussion and Analysis Q1/2026. According to the MD&A, 1Q2026 revenue was THB 146,936 million, up 11% year on year and 59% quarter on quarter. The revenue increase was driven by higher product prices in line with higher crude oil prices, as well as a recovery in upstream sales volumes after the Refinery and Aromatics Unit 2 returned to normal operations following the planned maintenance in 4Q2025.

On earnings, EBITDA was THB 13,977 million, the EBITDA margin was 10%, Adjusted EBITDA was THB 14,846 million, and the Adjusted EBITDA margin was also 10%. Adjusted EBITDA improved substantially from THB 5,377 million in the prior-year period and THB 4,239 million in the previous quarter. Net profit attributable to owners of the parent was THB 3,232 million, turning positive from a net loss of THB 2,567 million in the prior-year period and a net loss of THB 5,502 million in the previous quarter.

By business segment, the improvement in Upstream drove almost the entire recovery. Upstream Adjusted EBITDA was THB 12,938 million, comprising Refinery at THB 8,926 million, Aromatics at THB 1,597 million, and Olefins at THB 2,415 million. Refinery benefited from supply constraints caused by the Middle East conflict and improved product spreads; Aromatics benefited from improved paraxylene and benzene spreads; and Olefins benefited from higher ethylene / propylene prices and lower ethane costs under the contractual terms with PTT. Performance Chemicals also improved to THB 2,363 million, supported by seasonal demand in Europe and the US for allnex, easing destocking effects, and cost management.

At the same time, weak segments remain. Intermediates Adjusted EBITDA was negative THB 671 million, and Polymers and Chemicals was negative THB 126 million, indicating that margin pressure persisted despite the company-wide recovery. In particular, Polymers and Chemicals was pressured by higher ethylene feedstock costs even though polymer prices increased. From a credit perspective, this shows that even if the upstream business improves, the entire downstream chain does not necessarily recover at the same pace.

On the balance sheet, total assets at end-March 2026 were THB 662,742 million, liabilities were THB 360,900 million, and shareholders’ equity was THB 301,842 million. Interest-bearing debt / equity was 0.61x, unchanged from end-2025, while the interest coverage ratio improved to 3.44x. Cash and cash equivalents were THB 54,319 million, and cash and investments including current financial assets were THB 56,685 million, indicating thicker liquidity than at end-2025. However, the current ratio was 1.14x, down slightly from 1.19x at end-2025, so headroom in a phase of expanding working capital still needs to be monitored.

3. Credit Read-Through

First, these results somewhat ease GC’s near-term downgrade pressure. As of full-year 2025, the weakness of Net interest-bearing debt / EBITDA at 8.68x, EBITDA margin at 3.78%, and net loss of THB 14,600 million was consistent with the rating agencies’ Negative outlook. In 1Q2026, Adjusted EBITDA recovered to THB 14,846 million and interest coverage improved to 3.44x, so at minimum, the scenario that earnings are deteriorating further has receded.

Second, the quality of the recovery is not yet fully strong. The improvement in Upstream reflected the convergence of post-maintenance normalization, price increases, supply tightness caused by the Middle East conflict, and improved ethane contract terms. Some of these may persist, but stock gains could reverse from Q2 onward. The company itself has indicated the possibility of recording stock losses if crude oil prices normalize from 2Q2026 onward, and the possibility that higher crude premium, freight costs, and insurance premiums may mainly affect results from Q2 onward. Therefore, simply annualizing Q1 EBITDA to judge leverage improvement would be risky.

Third, liquidity improved as a support for bondholders. Operating cash flow was positive THB 31,340 million, while investing cash flow was also positive THB 5,682 million, supported by proceeds related to the TTT disposal and the jetty and tank farm restructuring. The increase in cash and cash equivalents plus current financial assets to THB 56,685 million indicates that, in addition to capital market access and hybrid funding, asset monetization is actually feeding through to liquidity. This is clearly positive for senior bond investors.

Fourth, structural credit constraints remain. Intermediates and Polymers and Chemicals generated negative EBITDA, and company-wide earnings were skewed toward Upstream and Performance Chemicals. GC’s credit quality continues to be supported by its relationship with PTT, integrated domestic assets in Thailand, market access, and capital policy including hybrid issuance and asset disposals. At the same time, the intrinsic earnings power of the commodity chain is still in the process of being verified. The potential olefins and polyolefins JV with SCGC, US ethane imports under the Olefins Feedstock Security Enhancement project, and stabilization of allnex earnings are medium-term upside factors, but the Q1 results alone are not enough to upgrade the credit story to a defensive IG profile.

In conclusion, the 1Q2026 results are positive as an initial confirmation of recovery. However, a significant portion of the turnaround to profit involved market-linked and one-off items, and sustainability cannot be judged until crude premium, stock losses, hedging, spreads, and working capital are observed from Q2 onward. The existing view should be moved forward modestly from a cyclical chemical credit with a strong business platform but still in the process of rebuilding financial headroom amid industry headwinds to a cyclical IG chemical credit that showed signs of recovery in Q1, but where earnings quality and deleveraging still need to be verified.

4. What To Watch Next

The first metric to watch next is 2Q2026 EBITDA and the stock / hedging effect. In Q1, stock gain / NRV of THB 7,182 million and commodity hedging loss of THB 7,991 million were large, and Q2 may show the impact of crude price normalization and higher crude premium. The core issue for credit assessment will be how far Adjusted EBITDA can be maintained from the Q1 level.

Second is the sustainability of the Upstream improvement. We should track Refinery, Aromatics, and Olefins utilization, product spreads, ethane costs, and the reversal of naphtha / LPG supply disruption. The company assumes 2026 Refinery utilization of 104%, Aromatics utilization of 82%, and Olefins utilization of 87%, so if actual results undershoot these levels, the Q1 improvement is likely to be reassessed as a short-term factor.

Third is the narrowing of losses in downstream and intermediates. If Intermediates and Polymers and Chemicals remain in negative EBITDA, GC’s recovery will remain skewed toward Upstream, limiting the assessment of group-wide earnings stability. In particular, it is necessary to confirm the gap between polymer prices and ethylene feedstock costs, as well as phenol / BPA / PTA / MEG spreads.

Fourth is the sustainability of liquidity and funding. Cash and investments of THB 56,685 million at end-March 2026 are substantial, but the current ratio is 1.14x and could decline easily if working capital increases or investment resumes. Interest-bearing debt / equity of 0.61x, interest coverage of 3.44x, the terms of conventional bond and bank funding, and market access excluding hybrids should continue to be monitored.

Fifth is progress on structural measures. The TTT disposal has already been monetized, demonstrating execution capability in asset monetization. Next, we should watch how far the non-binding MOU with SCGC becomes concrete in the evaluation targeted for Q3/2026, whether the OFS project progresses as planned toward US ethane imports in 2029, and whether allnex can sustain the improvement seen in Q1.

5. Sources

6. Unverified / Pending