SET-listed PTT Global Chemical (GC) aims to shift from red to black this year by continuing its cost reduction plan amid the sluggish global petrochemical industry.
The company will also better manage its assets, plan long-term purchases of raw materials as well as focus more on producing value-added products to increase revenue.
"We plan to reduce costs by 4.5 billion baht this year," said Narongsak Jivakanun, chief executive of GC.
In 2024, the company posted a total loss of 29.1 billion baht, including the impairment of assets and business operations.
Mr Narongsak said losses from business operations alone stood at 3.4 billion baht, so it should not be too difficult to deal with this loss through the cost reduction programme.
Last year GC managed to reduce costs by 9.6 billion baht.
The company will better manage assets in its portfolio by considering recycling some assets.
Earlier GC announced it had decided to withdraw from PTT Asahi Chemical, a petrochemical company that represents a joint venture with multinational Japanese chemical company Asahi Kasei Corporation, attributed to tougher competition in Asia.
GC made a 50% investment in PTT Asahi Chemical, with the other half of the investment coming from Asahi Kasei Corporation.
The withdrawal process will be completed by 2028, according to Mr Narongsak.
Business adjustments are needed as competition in the global petrochemical market is intensifying as China is exporting more petrochemical products to the Asian market after the US opted to impose a high tariff on these products, especially those used to produce plastics, from China.
This trade barrier has emerged even though the Asian market is already flooded with petrochemical products.
"It is not easy to precisely predict the petrochemical industry outlook as it depends on various factors. The supply glut should last until the middle of next year," said Mr Narongsak.
GC is reducing the risk of raw material price fluctuation by signing a 15-year purchase of ethylene, a feedstock for making plastic products.
It will also focus more on making more specialty polymers, which are needed in the car and electrical appliance industries.
This type of polymer faces less price volatility than common-grade polymers.
Specialty polymers currently make up 20% of polymer production while common-grade polymers account for 80%.
