The year of 2017 is considered as the starting point of Prima Marine Public Company Limited ("Company") to operate its business in oil shipping vessel business which could be connected with the exploration, drilling, production and trading of natural gas, petroleum and petrochemicals in fully integrated system of the Company. This is derived from the merger of some businesses of Nathalin Co., Ltd. ("Nathalin"), the major shareholder of the Company and Nathalin's joint venture which operates the same type of business along with the expansion of services covering: 1) Shipping Vessel Business for crude oil, refined oil products, semi-refined oil products and liquid petrochemicals (“Trading”); 2) Shipping and Storage Vessel Business for crude oil and refined oil products (“Floating Storage Unit (SFU)”); 3) Offshore Support Vessel; and 4) Ship Management. In order to enable the Company to have the potential and flexibility in expanding its business base in the future as well as to quickly adjust its business strategy in line with the characteristics of the petroleum and petrochemical industry which is fluctuated in demand, supply, and product prices all the time, this will result in a stable and sustainable business operation of the Company.
Owing to the business structure which is strong and proper to the industry, the stability of the Company's customer base comprising both domestically and internationally leading oil companies, the potential of the executive, and knowledgeable and skillful employees with high experience, the Company could be highly successful in offering ordinary shares to general investors and it has been listed on the Stock Exchange of Thailand on September 14, 2017 as well as capably raised funds to support long-term business expansion as planned.
For the operation in 2017, it was satisfactorily successful that the Company was able to adjust its strategy to mitigate its impact on businesses caused by severe fluctuations of crude oil prices in world market and changes in China's energy policy. As a result, the Company and its subsidiaries had total revenues of 4,540.75 Million Baht and net profit of 795.11 Million Baht or 0.33 Baht per share.
The sharp increase in crude oil prices from US$ 40-45 per barrel in mid-2017 to approximately US$ 60-65 per barrel by the end of the year was resulted by the rising global oil demand of 1 million barrels per day in accordance with the economic growth of the United States, Europe, China and emerging markets.
OPEC and Non-OPEC oil producers, especially Russia, also have significantly reduced their production capacity, causing oil traders in Singapore to reduce their FSU crude stocks for speculation in the 4th Quarter of 2017 because the oil futures market forecasted that the crude oil price tends to be dropped below US$ 60/barrel in the future if USA increases its Shale Oil production or OPEC and Non-OPEC oil producers resume to produce more crude oil. In addition, the use of FSU for storage and blending of bunker oil for selling as materials to the Teapot Refinery in China also was also declined during 2017 because the Chinese government changed its policy to control crude oil imports and allow these teapot refineries to import crude oil for refining to replace the use of bunker oil.
However, the Company has a plan to temporarily reduce the number of FSU vessels while the oil future market is waiting for the adjustment of crude oil prices, for minimizing costs and enabling the FSU fleet to be fully utilized. For the trading of Aframax vessels which is decreased due to the lower demand for bunker oil in China has been reduced since the end of 2017, the Company was able to acquire customers to use this service in long-term by replacing individual trip service for both vessels in 2018, and both vessels shall certainly earn income. Both trading and ship management businesses has continued to grow as expected in 2017 and are expected to grow further in 2018 because the Company provides vessels for refined oil to serve the increasing demands of its customers. For the new oil depot constructed in the South, the Company expects that the government's policy regarding the concession for exploration, drilling of natural gas and crude oil in the Gulf of Thailand will be clearer in 2018, which will benefit the Company's Offshore Support Vessel Business. We believe that the overall business in 2018 will be improved by the above-mentioned operations and the economic growth of many countries including Thailand will result in the increasing demand of using and transportation of petroleum and petrochemicals, that will be in line with the Company's business expansion plan. Furthermore, in order to make all shareholders and stakeholders to believe in the Company’s operation which is transparent and fair to all parties and to place a solid foundation for sustainable business growth, the Board of Directors recognizes the importance of good corporate governance to be compared with the international standard and established sub-committees consisting of Audit Committee, Risk Management Committee, and Nomination, Remuneration and Good Corporate Governance Committee, to regularly supervise, control and monitor all functions. The Company also announced its commitment in participating in Thailand’s Private Sector Collective Action Coalition Against Corruption (CAC) since September 2017.
Last but not least, I am pleased to inform all shareholders that the Board of Directors approved to propose the Annual General Meeting of Shareholders for the year 2018 to approve the dividend payment for the business operation of 2017 at 0.10 Baht per share, representing approximately 30.3% of the Company's and its subsidiaries’ total net profit even though the Company's ordinary shares has been traded on the Stock Exchange of Thailand for only 109 days in 2017. On behalf of the Board of Directors, I would like to take this opportunity to express our gratitude to all shareholders for supporting the Company with good cooperation and also express our appreciation to the Company’s management and employees for cooperatively work with utmost capability to make the organization successfully achieved its goal in listing on the Stock Exchange of Thailand and succeeded in business performance for 2017 as mentioned above. Wish you all happiness, success and prosperity forever.
Mr. Bowon Vongsinudom
Chairman of the Board of Directors
Prima Marine Public Company Limited