“Corporate health” at exceptional levels

In 2023, the Dung Quat Oil Refinery achieved a remarkable milestone, operating continuously for 1,180 days (over three years), the longest duration since its commercial operation began. The plant has consistently pushed boundaries, including a record-breaking average capacity for the whole year of 111% (the highest ever) and a remarkable average crude oil loss rate for the whole year of 0.11% volume (the lowest ever).

In 2023, BSR achieved remarkable success through its flexible adaptive solutions in management and administration, exceeding all production and business targets. The Dung Quat Oil Refinery operated at optimal capacity, producing a record-breaking 7.36 million tons of various products, exceeding the plan by 31%. Of this total, 7.34 million tons were consumed, generating a total revenue of over VND 150 trillion, a 3.5% increase above plan. This achievement also resulted in a significant contribution to the state budget of over VND 17 trillion and a net income of nearly VND 8.8 trillion."

BSR's financial performance has reached its healthiest state in the past five years, driven by production and business efficiency. The company's cash flow from business reached VND 11.6 trillion, a 66% increase over 2022, while its net cash amount reached VND 27.15 trillion, a 33% increase over the same period. These indicators were accompanied by improved liquidity and a reduced debt-to-capital structure ratio, positioning BSR in a strong financial position to capitalize on opportunities in the global oil market amid volatile oil prices. Moreover, this solid financial foundation provides a crucial premise for undertaking new investment projects in the future.

VNDIRECT Securities Corporation estimates that the crack spread (the difference between wholesale petroleum product prices and crude oil prices) of refined petroleum products will remain at a relatively high level in 2024.

Specifically, the company forecasts that the crack spread for diesel and jet fuel in Asia will average 21 USD/barrel and 20 USD/barrel respectively in 2024 compared to the average of 23.5 USD/barrel and 22.5 USD/barrel in 2023. These favorable crack spreads are expected to drive profits at Binh Son Refining and Petrochemical Joint Stock Company in 2024.

“BSR's production and business performance in 2023 stood out amid Vietnam's economy, particularly within the state-owned enterprise sector, where it operated effectively,” Mr. Nguyen Duc Kien, former Deputy Chairman of the National Assembly's Economic Committee and former Head of the Prime Minister's Economic Advisory Group, commented.

“In 2024, with the global oil and gas price fluctuations making it difficult to predict the economic situation, it is crucial for the State to have a reliable tool like BSR at its disposal to help stabilize the macroeconomy. Notably, BSR's performance in 2023 has made a significant contribution to macroeconomic stabilization, deserving of recognition,” Mr. Nguyen Duc Kien added.

Two key drivers for share's growth

BSR will have two additional motivations beyond cash flow and increased production and business for share growth, which include the relocation of the exchange to the HOSE and the implementation of the project to upgrade and expand the Dung Quat Oil Refinery.

On March 28, BSR approved adjustments to the Dung Quat Oil Refinery Upgrade and Expansion Project, which is expected to be implemented over a 37-month period from the signing of the EPC Contract. The project is scheduled to put into operation in 2028. Once complete, the Dung Quat Oil Refinery will be able to process 171,000 barrels of crude oil per day, an increase from the current capacity of 148,000 barrels per day. Additionally, the project will enhance the quality of gasoline and oil products to meet EURO 5 standards.

Furthermore, the project will also increase the proportion of high-value refined petroleum products, (such as LPG and Jet-A1), and petrochemical products. In the future, BSR plans to shift its business focus to the petrochemical industry.

One of BSR's notable issues in 2024 is the planned transfer of 3.1 billion shares, (with Petrovietnam holding approximately 2.9 billion shares), from the UPCoM to the HOSE.

BSR said in its statement that it will continue to implement this process when conditions are met and expects it to be completed this year. The listing transfer to HOSE is expected to enhance transparency, boost liquidity, drive up share prices, and provide access to large investors, ultimately increasing the potential for capital attraction for BSR. Currently, BSR's shares are traded in the range of VND 19,000 to VND 20,000 per share.

Source: Tinnhanhchungkhoan.vn