PTG Energy, a publicly listed fuel retailer, is negotiating with sugar millers to expand into the ethanol business, say its executives.
Rangsun Puangprang, PT’s executive vice president, said the company expected to take another two or three months to conclude a major investment project that would use the proceeds raised from its initial public offering last May.
The investment will help the firm diversify its business from fuel retailing, he said.
PT raised about Bt1.6 billion from its IPO last year but it has not yet been able to conclude the plans to invest the sum. The country’s sixth-largest fuel retailer announced net profit of Bt312.3 million last year, down from Bt340.3 million in 2012. Earnings per share decreased from Bt0.27 to Bt0.21, down 28.57 per cent year on year.
Chief executive officer Pitak Ratchakitprakarn said the marketing margin in the fuel-retailing business in Thailand had been quite low, at about Bt1.3 per litre, while the suitable rates should be around Bt1.50-Bt1.70 a litre or higher. The company hopes the marketing margin, calculated from the gap between retail and ex-refinery prices, will improve this year.
PT also announced yesterday that it would spend more than Bt1 billion to expand its retail business this year, including an increase in the number of service stations to 1,000 from 739 at the end of last year. It will also build two “signature stations” at Highways Department rest areas in Prachuap Khiri Khan and Chai Nat.
It is also finalising the location for its eighth fuel depot, which will be in either Sri Sa Ket or Roi Et.
The company aims to increase its market share by 1 percentage point to 7 per cent this year, with total sales of 2 billion litres, catching up with Caltex, which has an 8-per-cent share. It sold 1.578 billion litres of fuel last year, up 14 per cent from 2012.
By station number, PT will move up to No 2, second only to PTT, although most of its service stations are small and located on secondary roads.
Sales volume per station has increased from 150,000 litres in 2012 to 170,000 last year and is expected to increase further to 185,000-190,000 litres this year, Pitak said.
He said PT would like to have partnerships with many sugar millers, some of which have not yet built an ethanol plant. As E20 (20-per-cent ethanol) gasohol sales have increased considerably and are expected to replace normal petrol in the future, ethanol demand should continue to rise.
Currently, fuel business makes up 99 per cent of PTG’s revenues.
Nattisa Pongtaranont, executive vice president for marketing and customer relationship management, said PT was the only company to offer substantial rewards to consumers who buy their fuel with its loyalty card. To promote its PT Max Card further, the company is offering double reward points to its members until May 31.