PTL posts upsurge in Q1 profit

The flexible packaging industry witnessed an increase of 30-40% in demand for PET thin film in Q1. Flexible packaging accounts for approximately 70-75% of PTL revenues.

As a result, Polyplex (Thailand) Plc (PTL)’s normalized net profit in Q1 2020-21 (April 1-June 30, 2020) surged by 40% to 818 million baht (YoY), propelled largely by this increased demand for polyethylene terephthalate (PET) film which allowed for selling prices to hold steady while raw material prices declined.

Demand growth in the second quarter is expected to be healthy, however not at the same levels as the first quarter as the pandemic related panic buying has eased. There is still a steady reliance on plastics for their barrier properties when it comes to food and hygiene related products in consumer goods and the company remains confident of outperforming the industry performance, PTL Managing Director Amit Prakash said.

The PET film industry also saw a drop in demand for Thick PET film in industrial application mostly tied to discretionary goods and spending. However this is expected to pick up with the upcoming economic recovery. The revenues from film sold into industrial applications account for around 25-30% of PTL’s portfolio.

PTL’s financial performance is bolstered by the company’s strong position as the world’s fifth largest PET film producer and its judicious mix of standard and specialty films, effectively coupled with an extensive and stable customer base and its focus on innovation.

PTL has earmarked about US$90-100 million to increase output and upgrade its production capacities in Indonesia, Thailand and Turkey, while ensuring that the company’s US plant achieves maximum cost-effectiveness and efficiency.