IRPC set for profit increase

Piti said the company was able to boost its profit thanks to cost reduction through restructuring and production improvements over the past year.

It has cut operating costs by Bt700 million a year.

It also launched an early-retirement programme at the end of 2006. Two years ago, it employed nearly 9,000 workers and paid around Bt400 million each month in salaries. It has reduced the number of workers by 20 per cent.

Piti said the early-retirement programme would continue because there should not be more than 4,000 workers under its structure.

"We think our revenue last year will be similar to the previous year, but we believe our profits will show the best performance in the PTT group," he said.

Sicco Securities expects IRPC's fourth-quarter earnings to slightly drop due to lower petrochemical spreads, though refining margin is as high as US$6.73 (Bt222) per barrel. Annualised earnings are estimated at Bt13.39 billion, from Bt6.8 billion last year when the refinery was shut down temporarily. However, it foresees that in 2008 IRPC's earnings would drop to Bt10.58 billion.

According to a statement to the Stock Exchange of Thailand, IRPC posted a net profit of Bt11.5 billion in the first nine months of last year, up 15.6 per cent on year, due to the increasing refining margin, lower interest burden and business restructuring.

Siti said the company's debt had decreased from more than Bt100 billion two years ago to Bt18.1 billion.

Chalida Ekvitthayavechnukul,

Somluck Srimalee

The Nation