Corporate Info

Message from the Chairman

To Our Shareholders

Sawasdee krub. I do hope that you and your family are safe and well. 2020 was an unprecedented challenging year. It is difficult to understate the impact of the Coronavirus 2019 (COVID-19) pandemic on every aspects of our lives, on every community, and every country around the world. I know the level of stress and pain that you have faced and I want to acknowledge the incredible circumstances that we all endured. Yet, despite all these, we helped our business rise to the unique challenges that the pandemic has presented to our industry and Esso (Thailand) Public Company Limited. It is inspiring to see that we have achieved record safety and strong reliability performance, while supplying Thailand critical energy's need. We met our business objectives and support various relieve efforts critical to the response of the pandemic. We achieved all these while balancing health concerns and new responsibilities both at work and at home.

With the Company's stringent COVID-19 measures in-placed following the recommendations from the Ministry of Health, the cooperation and the attention of our employees, as well as the great leadership in the organization, I'm proud to report that in 2020 there were no employees of Esso Thailand infected by COVID-19. Moreover, in regard to safety, Esso Sriracha refinery and terminals continued to operate with an excellent safety performance without a lost-time incident. Clearly, this reflected our commitment to ensure proper safe guards are in place so we can achieve our key safety objective of Nobody Gets Hurt.

The refining industry and the sales of petroleum products have been severely affected globally from COVID-19 pandemic. The demand for petroleum products had diminished significantly, especially jet fuel, gasoline, and diesel, as a result of lockdown measures in many countries as well as travel restrictions during the first half of 2020. These demand destructions have caused significant pressure on refining margins. Both crude and finished product prices collapsed to the lowest levels in the past decades. Despite the fact that oil prices started to rebound during the second half of the year from relaxing lockdown measures, the price levels have not yet reached back to the pre COVID-19 level.

The uncontrollable factors mentioned above resulted in significant impact in Esso's financial performance in 2020 when comparing to those of the past years. Nevertheless, I am pleased to share that our operations in many businesses had outstanding performances in 2020. Esso Sriracha refinery creatively adjusted the production to meet declining demand. The refinery was able to stop producing jet fuel by upgrading to diesel. In addition, in August the refinery achieved the highest asphalt production in the past 3 years in responding to higher demand and strong uplift. In Retail business, the Company continued to expand service stations network to 702 stations at the end of this year, which is the highest number in decade. Furthermore, we have partnered with our new alliance, Minor Food, launched quality coffee at affordable prices called, "Coffee Journey" shops, in Esso service stations, and will continue to grow. In Commercial business, sales to industrial and commercial segment had increased against industry declining demand. It is imperative in this challenging environment that we put significant focus on structural cost reduction effort. In 2020, the Company managed to reduce its selling and administration expenses by 15% when compared to the previous year.

During this difficult time, we have done our best to ensure the safety and health of frontline personnel and help the vulnerable overcome the crisis. For instance, we gave face shields made by our employees and their families, and Personal Protective Equipment (PPE) to several public hospitals such as Bamrasnaradura Infectious Diseases Institute for use by medical staff battling COVID-19. In addition, our employees and customers donated 355,600 baht for the Thai Red Cross for obtaining medical devices and other medical necessities.

Anticipating that students of low-income families would be forced to leave schools due to economic recession caused by COVID-19, the Company, together with employees, Esso Club, Esso service station dealers, alliance partners, Mobil lubricant distributors, donated more than 2.5 million baht to Equitable Education Funds in the program "Esso brings back students to schools."

The pandemic has brought a significant head winds for our business and we continue to navigate the most difficult economic environment ever seen. 2020 achievements reflect the competency, experiences, and strong dedication of all employees to ensure that the Company continues to grow strongly and sustainably and to be an integral part of Thailand future growth in years to come as well as to create highest value to our shareholders following our vision "Power Life with Premier Energy Experience".

Last but not least, on behalf of the Board of Directors, I would like to thank you for your continued support to Esso Thailand.