DSNG FY15 Presentation Web
DSN Group FY 2015 Results Update
DSN Group is a
growing, and green,
producer of palm oil
and wood products
sold into global
markets. DSN
plantation operations
are among the most
or.
productive in the sector.
The DSN Group was originally established as a wood products
manufacturer. We expanded into the plantation sector in 1997,
building upon our relationships within local communities. Both
business segments are growing, but the palm oil business is
growing at a higher rate.
Palm oil accounted for 69% of total revenue in 2015, down from
72% in 2014, driven by lower CPO average selling prices.
Our history of expansion has accelerated in recent years, with
the acquisition of ten new oil palm estates since 2010, and two in
the past year.
We also took a controlling interest in Tanjung Kreasi Parquet
Industry, a manufacturer of globally branded engineered
flooring in 2012.
These subsidiaries provide long-term opportunities for
expansion in both of our core businesses.
Our plantations five-year track record highlights strong
growth and consistently effective and efficient management
Planted Area: Total, Nucleus & Plasma ('000 ha)
Mill Production: CPO, PK & PKO ('000 tons)
90
56
49
61
52
71
58
80
63
69
CPO
PK
PKO
391
407
336
257
189
Total
Nucleus
Plasma
7
9
13
2011
2012
2013
17
21
2014
2015
Mature Area: Total, Nucleus & Plasma ('000 ha)
24
36
43
13
53
18
61
20
2011
2012
2013
2014
2015
Revenue: CPO, PK & PKO (Rp trillions)
3.26
34
32
42
38
49
44
54
48
58
52
CPO
PK
PKO
2.81
2.37
1.84
1.41
Total
Nucleus
Plasma
2
4
5
6
6
2011
2012
2013
2014
2015
FFB Harvested: Total, Nucleus & Plasma (million tons)
1.02
1.24
1.15
1.38
1.26
1.49
1.35
0.09
0.12
0.07
0.04
0.21
0.05
0.20
0.04
2011
2012
2013
2014
2015
ASP: CPO, PK & PKO (Rp millions)
CPO
PK
PKO
7.4
10.8
7.3
0.74
4.4
Total
Nucleus
Plasma
0.00
0.04
0.09
0.12
0.14
2011
2012
2013
2014
2015
Yield per Hectare: FFB, CPO & PK - Nucleus only (tons)
25.5
26.4
26.2
26.2
22.4
FFB
CPO
PK
2012
4.2
2.7
2013
2014
2015
Mill Efficiency & Effectiveness: OER & FFA (%)
24.6
24.4
24.3
23.9
23.6
OER
FFA
5.4
6.0
6.4
6.3
6.2
0.7
0.9
0.8
0.9
0.9
2011
2012
2013
2014
2015
2
2011
6.9
4.9
3.3
10.3
8.3
7.1
7.0
2.5
2.7
2.6
2.9
2.6
2011
2012
2013
2014
2015
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Our estates are clustered across East, West and Central
Kalimantan, with acquisitions AAN & MNS in the West
Nucleus
Total
Planted
Mature
DSN acquired 2 18,000 ha estates
in 2015. AAN is partially planted
while MNS is greenfield.
(‘000 ha)
163.6
69.3
51.8
At year end, we had 69,291 ha
nucleus and 51,783 ha of mature
estates with an average ages of
7.5 and 9.5 years respectively.
Our FFB yield was 26.2 tons/ha.
N. Kal
Our land bank now totals just over
94,000ha after 3 estates were
dropped – DBL, MAL and RUT. In
addition to expiring Ijin Lokasi,
these estates were unlikely to
allow for development in light of
recent changes in industry policy.
E.
E Kal
W. Kal
C. Kal
Land Rights
Land Area ('000 Ha)
Estate
Year
Province
Acquired
Mature Planted
Total
Avail.
HGU
PB
IL
Avg Age (Yrs)
Mature
Area*
Total
Area
Yield
2015
(t/ha)
DIL
D
2009
N. Kal.
-
2.9
7.2
4.4
-
2.0
-
SWA
DWT
DAN
D
DIN
D
KPS
2001
2007
1997
1997
2011
E. Kal.
E. Kal.
E. Kal.
E. Kal.
E. Kal.
15.3
8.0
9.0
8.7
2.1
15.3
10.2
9.0
8.7
6.1
16.9
13.6
10.0
9.8
6.2
1.6
3.4
1.0
1.0
0.1
14.7
6.0
8.9
8.9
6.4
14.7
5.2
8.9
8.9
3.5
27.9
24.5
29.0
31.5
21.8
-
1.0
17.0
16.0
-
0.2
-
1.1
-
2.6
2.4
1.2
1.2
18.2
14.9
10.6
6.1
15.6
12.5
9.4
4.9
4.3
-
2.5
1.4
1.1
0.9
3.6
-
PUL
P
2012
E. Kal.
AAN
KAP
K
PSA
P
DPS
2015
2010
2010
2010
W. Kal.
W. Kal.
W. Kal.
W. Kal.
MNS
M
2015
W. Kal.
-
-
18.0
18.0
-
-
-
PWP
P
2004
C. Kal.
7.6
8.7
15.2
6.4
5.7
5.2
18.9
51.8
69.3
163.6
94.3
9.5
7.5
26.2
Total
35% 12% 53%
* As of year-end 2015
Full Year 2015 Operating Results Update
3
Our planted area has grown by acquisition and plantin
planting
since 2001, resulting in a relatively young age profile
Annual Estate Growth History
Cum. Area
Plasma %
8.8
8.8
11.9
15.2
19.9
23.5
31.1
0%
Acquiring AAN in Q2 provided
nearly 1,900 ha of nucleus and
800 ha of plasma, of which 1,200
ha were mature.
Our commitment to plasma
holders is a critical element in
the success of DSN’s palm oil
activities, often easing title
conversion, and minimizing the
prospect of social
disturbances.
4
35.1
6%
41.2
7%
45.0
9%
49.4
14%
52.1
18%
57.9
22%
62.8
28%
69.3
30%
Our plasma area spans 20,920
ha at the end of 2015, or 30% of
our planted area. DSN
manages 17,914 ha under a
BoT model, which results in
higher yields and revenues for
plasma holders, while DSN
benefits from milling margins.
DSN retains a 5% management
fee from FFB revenues. The
plasma holders claim 30% of
the remainder, while 70%
services bank loans, upkeep
and maintenance of the estate
prior to breaking even.
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Our planting and age profile to date suggests an average
10% annual growth in FFB production through 2018
Based on area planted through 2015
Our planted areas will all
mature by 2019. The yield
expansion of the sizeable
Young Mature areas should
offset the decline in Old
Full Year 2015 Operating Results Update
Mature areas, with a standard
FFB yield expanding to as high
as 26.5 tons/ha (Class II soil) in
2020, up from a standard yield
of 24.7 tons/ha in 2015.
5
Our younger estates have achieved or exceeded the
standard yields for Class II soil over a number of years
Standard yields for our age
profile suggest yields
could continue to increase
through 2020, barring
environmental factors.
Our mature area will
increase from 51,783 ha in
2015 to 69,291 ha by 2019
based on the area already
planted, with a prospective
Class II soil yield of 1.84
million tons FFB in 2020.
6
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Despite the adverse weather in 2015, nucleus yields
remained at 26.2 t/ha, while plasma yields expanded
In 2015, DSN produced 1.35
million tons FFB from
nucleus estates, with an
additional 138 thousand tons
from plasma. In aggregate,
FFB output increased by 8.2%
from 2014, with a nucleus
yield of 26.2 tons per hectare
and a plasma yield of 22.6
tons per hectare.
3rd party purchases were
reduced by 10% in 2015,
despite the launch of Mill 6 in
Q1. In all, FFB processed
rose by 6% to 1.73 million
tons.
Full Year 2015 Operating Results Update
7
Our most develo
developed
elo
lop
ped cluste
cluster
err - w
e
with 5 estates, 5 CPO
C
Mills
and 56,000 ha
a - is nearly the size of Singapore
71% of our planted area is
located in a contiguous block
in East Kalimantan - an area
the size of Singapore.
Five of our palm oil mills are
located within these estates,
supporting an 8-hour standard
for harvest-to-mill, resulting in
minimal spoilage of FFB and
lower FFA.
Each mill’s capacity can
accommodate peak output
from a 10,000 ha estate, while
mills servicing developing
estates (such as PWP) may
purchase external FFB.
At a cost of roughly $18 - $20
million per mill, this adds
$2,000 to development costs
per hectare.
CPO mill capacity designed for peak production
DWT
Mill 6
Mill 3
Mill 2
Mill 7
DAN
DIN
SWA
Mill 4
KPS
Mill 1
Existing CPO Mills
Planned CPO Mills
Trans-East Kal. Road
We are a member of the
Roundtable on Sustainable Palm
Oil (RSPO), and strive to comply
with global RSPO and the
Indonesian Sustainable Palm Oil
(“ISPO”) principles.
We have received RSPO
certification for our SWA, DAN
and DIN palm oil plantations
along with their respective mills,
8
and have ISPO certification for
Mill 1.
We are also committed to
protecting our environment. By
setting aside 6,600 hectares, or
an area roughly equivalent to
10% of our total planted area, for
conservation purposes
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Stable FFB yields and a slightly lower OER generated 6.2
tons of CPO per hectare, with an FFA level of just 2.57%
CPO production
expanded by 4.2% in
2015, with an Oil
Extraction Rate (OER) of
23.6% for the year. Palm
Kernel production rose
by 13.6% to 60,598 tons,
with most used by our
Palm Kernel Oil mill
which produced 20,489
tons of PKO.
Our CPO production quality improved during the year, with
aggregate FFA levels of just 2.57%. The maximum monthly FFA
level from our own production was just 2.88% Q4.
Over 75% of our East Kalimantan output for the year was sold with
FFA below 3%, and can receive a premium to standard CPO.
Full Year 2015 Operating Results Update
9
DSN s productivity, at 6.2 tons of CPO per hectare in 201
DSN’s
2015,
is consistently ahead of peers, whatever the age profile
Source: Company reporting and analyst research
With FFB yields remaining stable in 2015 at 26.2 tons per hectare,
CPO yields dropped slightly to 6.2 tons per hectare, largely as a
result of a 1% drop in the OER.
This was driven, at least in part, by the extremely dry conditions
in the second half of the year. Our East Kalimantan estates
experienced four successive months of historically low rainfall,
only moderately alleviated in the final two months of the year.
10
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Expan
Expanding
pan
nd
ding domestic refining capacity, coupled with our
high
ghgh
h-quality product, ensures robust demand for our CPO
DSN Estates
D
DSN Ports
D
DSN Customers
D
Re
Refineries
Sales Performance
P erio d
CPO
PK
PKO
Vo lume
A SP
'000 to ns
%Δ
FY 2015
410
4
2014
2013
2012
2011
394
336
253
190
17
33
33
40
FY 2015
10
-6
2014
2013
2012
2011
10 -35
16 -55
35 63
21 23
FY 2015
20
2014
2013
20 110
9
-
-1
Rp mn/to n
Revenue
%Δ
Rp B n
%Δ
6.86 -17
8.27 17
7.05 -3
7.29 -2
7.44 12
2,810 -14
4.17 -14
40 -19
4.85
2.70
3.33
4.38
79
-19
-24
33
10.33 -5
10.84 52
7.11
-
Full Year 2015 Operating Results Update
3,262
2,369
1,840
1,411
38
29
30
57
49 16
42 -63
115 24
93 63
202
-6
214 219
67
-
Our customers are
primarily CPO refineries
located in Kalimantan
and Java, including
Smart, Wilmar, Kuala
Lumpur Kepong, Musim
Mas and Dermaga
Kencana Indonesia.
In 2015, we sold 410
thousand tons of CPO,
at an average selling
price of Rp6.86 million
per ton. While volume
was up by 4.3%, pricing
fell 17.1% below the
previous year.
Pricing for Palm Kernel
(PK) was also lower by
14.1%, while Palm Kernel
Oil (PKO) was off by
4.6% from 2014.
11
Costs were lower during the year, and the seasonality of
o
fertilizer application led to expanding margins in Q4
C ost of Sales (IDR b n)
Fertilizer
Labor
Others
2015
337.2
479.5
267.1
2014
324.7
401.0
328.6
2013
288.7
336.0
244.7
2012
326.7
274.3
224.3
2011
193.7
166.1
227.4
FFB Purchased
Milling
517.1
105.6
663.5
101.6
294.1
99.5
179.1
65.1
69.0
33.6
Total cash cost
1,706.5
1,819.3
1,263.0
1,069.5
689.7
Fertilizer
Labor
Others
19.8%
28.1%
15.7%
17.8%
22.0%
18.1%
22.9%
26.6%
19.4%
30.5%
25.6%
21.0%
28.1%
24.1%
33.0%
FFB Purchased
Milling
30.3%
6.2%
36.5%
5.6%
23.3%
7.9%
16.7%
6.1%
10.0%
4.9%
4.16
20.93
4.61
21.95
3.76
19.92
4.23
21.51
3.64
17.82
312
1,566
388
1,848
359
1,906
451
2,293
414
2,029
3.38
323
3.90
416
3.46
394
C ost as a % of total
U nit Cash Costs
(IDR mn)
IDR/ton CPO - Total
IDR/Mature Ha*
(USD)
USD/ton CPO - Total
USD/Mature Ha*
*Excluding Milling Costs
U nit Cash Costs from Internal FFB Only
IDR/ton CPO
USD/ton CPO
3.64
272
3.73
314
U nit Cash Costs from Internal FFB, net of revenues for FFB, PK & PKO
IDR/ton CPO - net
USD/ton CPO - net
Avg IDR/USD Rate
3.00
224
3.00
253
3.04
291
3.45
367
2.97
338
13,360
11,878
10,451
9,380
8,779
Cash costs per mature hectare improved
by nearly 5% to Rp20.9 million.
P alm Oil Financ ial Summary (I DR bn) Q 4- 2015 Q 3- 2015 Q o Q Δ%
Revenue
Gross Profit
% margin
Operating Profit
% margin
EBITDA
% margin
Profit Before Tax
% margin
12
824
363
44.0
300
36.3
362
43.9
274
33.2
716
201
28.1
106
14.8
171
23.9
46
6.4
15.1
80.4
182.7
111.8
499.8
Our total cash cost
declined by Rp113
billion in 2015, on falling
FFB purchases and
Other expenses.
We produced CPO at a
cash cost of Rp4.16
million per ton, for a 10%
improvement over 2014.
Excluding the costs of
purchasing and milling
3rd party FFB, our cost
per ton was just Rp3.64
million.
If we also net off the
revenues derived from
the sale of FFB, Palm
Kernel and Palm Kernel
Oil, our cash cost per
ton declines further, to
Rp3.0 million, consistent
with the previous two
years.
2 015
3,055
1,106
36.2
788
25.8
1,043
34.1
611
20.0
2 014* Y o Y Δ%
3,525
1,509
42.8
1,166
33.1
1,376
39.0
1,051
29.8
(13.3)
(26.7)
(32.4)
(24.2)
(41.9)
2 013
2,478
1,046
42.2
707
28.5
885
35.7
517
20.9
PT Dharma Satya Nusantara Tbk (DSNG.JK)
DSN is also a leading
ng w
wood products manufacturer with reputable
brand names & long
g-standing
client relationships
We are the 4th largest wood
products manufacturer in
Indonesia, producing panels,
engineered floors and doors.
Recent acquisitions and JVs
are shifting our product mix
into higher margin engineered
flooring and doors.
We have sufficient capacity to
meet our current growth plans,
but will be enhancing our
efficiency by consolidating
W ood P roduc t s Operat ing Summary
Q4-2015
operations from Surabaya and
Gresik to a new processing
plant in Lumajang by 2015,
thereby reducing our
transportation costs.
We comply with numerous
international environmental
standards, and seek to ensure
that all logs and sawn timber
purchased for our operations
are sourced from sustainable
forest resources.
Q3-2015
QoQ Δ%
2015
2014
YoY Δ%
2013
Sales Volume
Panel (m3)
34,263
38,905
(11.9)
179,567
201,696
(11.0)
Engineered doors (pcs)
18,325
16,754
9.4
61,948
51,469
20.4
51,989
Engineered floors (m2)
282,246
298,926
(5.6)
1,098,251
1,145,956
(4.2)
1,073,412
244,642
Average Selling Price (IDR mn)
3.6
4.68
4.37
7.2
3.97
Engineered doors (pcs)
1.06
1.11
(3.9)
1.25
1.24
1.1
1.06
Engineered floors (m2)
0.39
0.44
(11.1)
0.41
0.37
11.4
0.31
Q4-2015
Q3-2015
QoQ Δ%
2015
2014*
YoY Δ%
2013
300
337
(10.9)
1,370
1,374
(0.2)
1,364
27
(33)
(180.5)
69
200
(65.3)
144
8.9
(9.8)
5.1
14.6
0.0
10.5
Panel (m3)
4.95
4.78
Wood P roduc t s Financ ial Summary (I DR bn)
Revenue
Gross Profit
% margin
Operating Profit
% margin
EBITDA
% margin
Profit Before Tax
% margin
50
(40)
16.6
(12.0)
63
(27)
21.1
(8.0)
54
(78)
18.0
(23.3)
Full Year 2015 Operating Results Update
(223.7)
51
11
374.6
20
3.7
0.8
0.0
1.5
(334.3)
104
64
61.6
73
7.6
4.7
0.0
5.4
(30)
(41)
(27.8)
(2.2)
(3.0)
(168.8)
(80)
(5.9)
13
Full Year 2015 Financial Summary
T ot al C ons olidat ed (I DR bn)
Q 4-2015 Q 3-2015 Q oQ Δ%
Revenue
Gross Profit
% margin
Operating Profit
% margin
EBITDA
% margin
Net Profit
% margin
Forex gain (loss) from financing
Exceptional item
Adjusted Profit**
% margin
Cash flow from operations
Cash flow from investments
Cash flow from financing
T ot al P alm Oil (I DR bn)
1,125
389
34.6
300
26.7
376
33.4
177
15.7
34
45
118
10.5
1,053
168
16.0
51
4.9
130
12.3
(49)
(4.6)
(55)
51
(45)
(4.3)
198
(132)
254
94
(198)
41
824
363
44.0
300
36.3
362
43.9
274
33.2
Tot al Wood P roduc t s (I DR bn)
190.4
(463.5)
(360.7)
110.8
(33.2)
527.1
716
201
28.1
106
14.8
171
23.9
46
6.4
15.1
80.4
182.7
111.8
499.8
Q4- 2015 Q3- 2015 Qo Q Δ%
Revenue
Gross Profit
% margin
Operating Profit
% margin
EBITDA
% margin
Profit Before Tax
% margin
300
27
8.9
50
16.6
63
21.1
54
18.0
Financ ial P os it ion
337
(33)
(9.8)
(40)
(12.0)
(27)
(8.0)
(78)
(23.3)
(10.9)
(180.5)
(223.7)
(334.3)
(168.8)
Q4- 2015 Q3- 2015 Qo Q Δ%
Total debt
Net debt
Total Asset
Total Equity
Total debt / equity
Net debt / equity
Net debt / EBITDA
4,321
3,299
7,853
2,507
1.7x
1.3x
3.2x
* Restated
3,919
3,346
7,454
2,287
1.7x
1.5x
3.4x
10.2
-1.4
5.4
9.6
2 015
2 014*
Y oY Δ%
2 013
2 012
4,425
1,175
26.6
730
16.5
1,039
23.5
303
6.8
(71)
128
259
5.9
4,898
1,709
34.9
1,075
22.0
1,339
27.3
650
13.3
(12)
(69)
711
14.5
(9.7)
(31.3)
3,842
1,190
31.0
657
17.1
888
23.1
216
5.6
(184)
3,411
961
28.2
494
14.5
666
19.5
252
7.4
(34)
(63.5)
354
9.2
278
8.2
239
(699)
193
997
(885)
593
(76.0)
(21.1)
(67.4)
595
(745)
96
149
(826)
488
2015
2014*
Y o Y Δ%
2013
2012
3,055
1,106
36.2
788
25.8
1,043
34.1
611
20.0
3,525
1,509
42.8
1,166
33.1
1,376
39.0
1,051
29.8
(13.3)
(26.7)
2,478
1,046
42.2
707
28.5
885
35.7
517
20.9
1,997
820
41.1
496
24.8
614
30.8
416
20.9
2015
2014*
Y o Y Δ%
2013
2012
1,370
69
5.1
51
3.7
104
7.6
(30)
(2.2)
1,374
200
14.6
11
0.8
64
4.7
(41)
(3.0)
(0.2)
(65.3)
1,364
144
10.5
20
1.5
73
5.4
(80)
(5.9)
1,414
141
10.0
70
4.9
123
8.7
33
2.3
(32.1)
(22.4)
(53.4)
498.3
(32.4)
(24.2)
(41.9)
374.6
61.6
(27.8)
2015
2014*
Y o Y Δ%
2013
2012
4,321
3,299
7,853
2,507
1.7x
1.3x
3.2x
3,532
2,408
7,174
2,293
1.5x
1.0x
1.8x
22.3
37.0
9.5
9.3
2,961
2,474
5,921
1,679
1.8x
1.5x
2.8x
2,733
2,195
5,141
1,406
1.9x
1.6x
3.3x
** Consolidated adjusted profit excludes the impact of unrealized financing forex gains/losses
I D R Bn
US$ MM
Revolving Loan
Current Portion of LT Debt
Long Term Debt
Finance Leases
538
303
2,816
4
28.9
9.7
9.2
0.1
Total
3,661
47.8
14
486.0
Q 4- 2015 Q3- 2015 Qo Q Δ%
Revenue
Gross Profit
% margin
Operating Profit
% margin
EBITDA
% margin
Profit Before Tax
% margin
Loans by C urrenc y, FY2015
6.8
131.6
Note: Annual Financial Statements are
audited by Siddharta & Wijaja, Registered
Public Accountants - a Member Firm of
KPMG International.
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Full Year 2015 Operations Summary
Full Year 2015 Operating Results Update
15
DSNG Daily Share Price (rp/share) & Trading Volume (shares)
1,000
750
500
250
0
For additional information,
please refer to our website at:
14-Jun-13
14-Dec-13
14-Jun-14
14-Dec-14
14-Jun-15
www.dsn.co.id
14-Dec-15
If you have additional
questions or requests, you may
contact us at:
DSNG Share Price vs. IDX & Agri Index
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2.5
DSNG
2.0
investor.relations@dsngroup.co.id
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䇻
DSN Group is a
growing, and green,
producer of palm oil
and wood products
sold into global
markets. DSN
plantation operations
are among the most
or.
productive in the sector.
The DSN Group was originally established as a wood products
manufacturer. We expanded into the plantation sector in 1997,
building upon our relationships within local communities. Both
business segments are growing, but the palm oil business is
growing at a higher rate.
Palm oil accounted for 69% of total revenue in 2015, down from
72% in 2014, driven by lower CPO average selling prices.
Our history of expansion has accelerated in recent years, with
the acquisition of ten new oil palm estates since 2010, and two in
the past year.
We also took a controlling interest in Tanjung Kreasi Parquet
Industry, a manufacturer of globally branded engineered
flooring in 2012.
These subsidiaries provide long-term opportunities for
expansion in both of our core businesses.
Our plantations five-year track record highlights strong
growth and consistently effective and efficient management
Planted Area: Total, Nucleus & Plasma ('000 ha)
Mill Production: CPO, PK & PKO ('000 tons)
90
56
49
61
52
71
58
80
63
69
CPO
PK
PKO
391
407
336
257
189
Total
Nucleus
Plasma
7
9
13
2011
2012
2013
17
21
2014
2015
Mature Area: Total, Nucleus & Plasma ('000 ha)
24
36
43
13
53
18
61
20
2011
2012
2013
2014
2015
Revenue: CPO, PK & PKO (Rp trillions)
3.26
34
32
42
38
49
44
54
48
58
52
CPO
PK
PKO
2.81
2.37
1.84
1.41
Total
Nucleus
Plasma
2
4
5
6
6
2011
2012
2013
2014
2015
FFB Harvested: Total, Nucleus & Plasma (million tons)
1.02
1.24
1.15
1.38
1.26
1.49
1.35
0.09
0.12
0.07
0.04
0.21
0.05
0.20
0.04
2011
2012
2013
2014
2015
ASP: CPO, PK & PKO (Rp millions)
CPO
PK
PKO
7.4
10.8
7.3
0.74
4.4
Total
Nucleus
Plasma
0.00
0.04
0.09
0.12
0.14
2011
2012
2013
2014
2015
Yield per Hectare: FFB, CPO & PK - Nucleus only (tons)
25.5
26.4
26.2
26.2
22.4
FFB
CPO
PK
2012
4.2
2.7
2013
2014
2015
Mill Efficiency & Effectiveness: OER & FFA (%)
24.6
24.4
24.3
23.9
23.6
OER
FFA
5.4
6.0
6.4
6.3
6.2
0.7
0.9
0.8
0.9
0.9
2011
2012
2013
2014
2015
2
2011
6.9
4.9
3.3
10.3
8.3
7.1
7.0
2.5
2.7
2.6
2.9
2.6
2011
2012
2013
2014
2015
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Our estates are clustered across East, West and Central
Kalimantan, with acquisitions AAN & MNS in the West
Nucleus
Total
Planted
Mature
DSN acquired 2 18,000 ha estates
in 2015. AAN is partially planted
while MNS is greenfield.
(‘000 ha)
163.6
69.3
51.8
At year end, we had 69,291 ha
nucleus and 51,783 ha of mature
estates with an average ages of
7.5 and 9.5 years respectively.
Our FFB yield was 26.2 tons/ha.
N. Kal
Our land bank now totals just over
94,000ha after 3 estates were
dropped – DBL, MAL and RUT. In
addition to expiring Ijin Lokasi,
these estates were unlikely to
allow for development in light of
recent changes in industry policy.
E.
E Kal
W. Kal
C. Kal
Land Rights
Land Area ('000 Ha)
Estate
Year
Province
Acquired
Mature Planted
Total
Avail.
HGU
PB
IL
Avg Age (Yrs)
Mature
Area*
Total
Area
Yield
2015
(t/ha)
DIL
D
2009
N. Kal.
-
2.9
7.2
4.4
-
2.0
-
SWA
DWT
DAN
D
DIN
D
KPS
2001
2007
1997
1997
2011
E. Kal.
E. Kal.
E. Kal.
E. Kal.
E. Kal.
15.3
8.0
9.0
8.7
2.1
15.3
10.2
9.0
8.7
6.1
16.9
13.6
10.0
9.8
6.2
1.6
3.4
1.0
1.0
0.1
14.7
6.0
8.9
8.9
6.4
14.7
5.2
8.9
8.9
3.5
27.9
24.5
29.0
31.5
21.8
-
1.0
17.0
16.0
-
0.2
-
1.1
-
2.6
2.4
1.2
1.2
18.2
14.9
10.6
6.1
15.6
12.5
9.4
4.9
4.3
-
2.5
1.4
1.1
0.9
3.6
-
PUL
P
2012
E. Kal.
AAN
KAP
K
PSA
P
DPS
2015
2010
2010
2010
W. Kal.
W. Kal.
W. Kal.
W. Kal.
MNS
M
2015
W. Kal.
-
-
18.0
18.0
-
-
-
PWP
P
2004
C. Kal.
7.6
8.7
15.2
6.4
5.7
5.2
18.9
51.8
69.3
163.6
94.3
9.5
7.5
26.2
Total
35% 12% 53%
* As of year-end 2015
Full Year 2015 Operating Results Update
3
Our planted area has grown by acquisition and plantin
planting
since 2001, resulting in a relatively young age profile
Annual Estate Growth History
Cum. Area
Plasma %
8.8
8.8
11.9
15.2
19.9
23.5
31.1
0%
Acquiring AAN in Q2 provided
nearly 1,900 ha of nucleus and
800 ha of plasma, of which 1,200
ha were mature.
Our commitment to plasma
holders is a critical element in
the success of DSN’s palm oil
activities, often easing title
conversion, and minimizing the
prospect of social
disturbances.
4
35.1
6%
41.2
7%
45.0
9%
49.4
14%
52.1
18%
57.9
22%
62.8
28%
69.3
30%
Our plasma area spans 20,920
ha at the end of 2015, or 30% of
our planted area. DSN
manages 17,914 ha under a
BoT model, which results in
higher yields and revenues for
plasma holders, while DSN
benefits from milling margins.
DSN retains a 5% management
fee from FFB revenues. The
plasma holders claim 30% of
the remainder, while 70%
services bank loans, upkeep
and maintenance of the estate
prior to breaking even.
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Our planting and age profile to date suggests an average
10% annual growth in FFB production through 2018
Based on area planted through 2015
Our planted areas will all
mature by 2019. The yield
expansion of the sizeable
Young Mature areas should
offset the decline in Old
Full Year 2015 Operating Results Update
Mature areas, with a standard
FFB yield expanding to as high
as 26.5 tons/ha (Class II soil) in
2020, up from a standard yield
of 24.7 tons/ha in 2015.
5
Our younger estates have achieved or exceeded the
standard yields for Class II soil over a number of years
Standard yields for our age
profile suggest yields
could continue to increase
through 2020, barring
environmental factors.
Our mature area will
increase from 51,783 ha in
2015 to 69,291 ha by 2019
based on the area already
planted, with a prospective
Class II soil yield of 1.84
million tons FFB in 2020.
6
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Despite the adverse weather in 2015, nucleus yields
remained at 26.2 t/ha, while plasma yields expanded
In 2015, DSN produced 1.35
million tons FFB from
nucleus estates, with an
additional 138 thousand tons
from plasma. In aggregate,
FFB output increased by 8.2%
from 2014, with a nucleus
yield of 26.2 tons per hectare
and a plasma yield of 22.6
tons per hectare.
3rd party purchases were
reduced by 10% in 2015,
despite the launch of Mill 6 in
Q1. In all, FFB processed
rose by 6% to 1.73 million
tons.
Full Year 2015 Operating Results Update
7
Our most develo
developed
elo
lop
ped cluste
cluster
err - w
e
with 5 estates, 5 CPO
C
Mills
and 56,000 ha
a - is nearly the size of Singapore
71% of our planted area is
located in a contiguous block
in East Kalimantan - an area
the size of Singapore.
Five of our palm oil mills are
located within these estates,
supporting an 8-hour standard
for harvest-to-mill, resulting in
minimal spoilage of FFB and
lower FFA.
Each mill’s capacity can
accommodate peak output
from a 10,000 ha estate, while
mills servicing developing
estates (such as PWP) may
purchase external FFB.
At a cost of roughly $18 - $20
million per mill, this adds
$2,000 to development costs
per hectare.
CPO mill capacity designed for peak production
DWT
Mill 6
Mill 3
Mill 2
Mill 7
DAN
DIN
SWA
Mill 4
KPS
Mill 1
Existing CPO Mills
Planned CPO Mills
Trans-East Kal. Road
We are a member of the
Roundtable on Sustainable Palm
Oil (RSPO), and strive to comply
with global RSPO and the
Indonesian Sustainable Palm Oil
(“ISPO”) principles.
We have received RSPO
certification for our SWA, DAN
and DIN palm oil plantations
along with their respective mills,
8
and have ISPO certification for
Mill 1.
We are also committed to
protecting our environment. By
setting aside 6,600 hectares, or
an area roughly equivalent to
10% of our total planted area, for
conservation purposes
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Stable FFB yields and a slightly lower OER generated 6.2
tons of CPO per hectare, with an FFA level of just 2.57%
CPO production
expanded by 4.2% in
2015, with an Oil
Extraction Rate (OER) of
23.6% for the year. Palm
Kernel production rose
by 13.6% to 60,598 tons,
with most used by our
Palm Kernel Oil mill
which produced 20,489
tons of PKO.
Our CPO production quality improved during the year, with
aggregate FFA levels of just 2.57%. The maximum monthly FFA
level from our own production was just 2.88% Q4.
Over 75% of our East Kalimantan output for the year was sold with
FFA below 3%, and can receive a premium to standard CPO.
Full Year 2015 Operating Results Update
9
DSN s productivity, at 6.2 tons of CPO per hectare in 201
DSN’s
2015,
is consistently ahead of peers, whatever the age profile
Source: Company reporting and analyst research
With FFB yields remaining stable in 2015 at 26.2 tons per hectare,
CPO yields dropped slightly to 6.2 tons per hectare, largely as a
result of a 1% drop in the OER.
This was driven, at least in part, by the extremely dry conditions
in the second half of the year. Our East Kalimantan estates
experienced four successive months of historically low rainfall,
only moderately alleviated in the final two months of the year.
10
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Expan
Expanding
pan
nd
ding domestic refining capacity, coupled with our
high
ghgh
h-quality product, ensures robust demand for our CPO
DSN Estates
D
DSN Ports
D
DSN Customers
D
Re
Refineries
Sales Performance
P erio d
CPO
PK
PKO
Vo lume
A SP
'000 to ns
%Δ
FY 2015
410
4
2014
2013
2012
2011
394
336
253
190
17
33
33
40
FY 2015
10
-6
2014
2013
2012
2011
10 -35
16 -55
35 63
21 23
FY 2015
20
2014
2013
20 110
9
-
-1
Rp mn/to n
Revenue
%Δ
Rp B n
%Δ
6.86 -17
8.27 17
7.05 -3
7.29 -2
7.44 12
2,810 -14
4.17 -14
40 -19
4.85
2.70
3.33
4.38
79
-19
-24
33
10.33 -5
10.84 52
7.11
-
Full Year 2015 Operating Results Update
3,262
2,369
1,840
1,411
38
29
30
57
49 16
42 -63
115 24
93 63
202
-6
214 219
67
-
Our customers are
primarily CPO refineries
located in Kalimantan
and Java, including
Smart, Wilmar, Kuala
Lumpur Kepong, Musim
Mas and Dermaga
Kencana Indonesia.
In 2015, we sold 410
thousand tons of CPO,
at an average selling
price of Rp6.86 million
per ton. While volume
was up by 4.3%, pricing
fell 17.1% below the
previous year.
Pricing for Palm Kernel
(PK) was also lower by
14.1%, while Palm Kernel
Oil (PKO) was off by
4.6% from 2014.
11
Costs were lower during the year, and the seasonality of
o
fertilizer application led to expanding margins in Q4
C ost of Sales (IDR b n)
Fertilizer
Labor
Others
2015
337.2
479.5
267.1
2014
324.7
401.0
328.6
2013
288.7
336.0
244.7
2012
326.7
274.3
224.3
2011
193.7
166.1
227.4
FFB Purchased
Milling
517.1
105.6
663.5
101.6
294.1
99.5
179.1
65.1
69.0
33.6
Total cash cost
1,706.5
1,819.3
1,263.0
1,069.5
689.7
Fertilizer
Labor
Others
19.8%
28.1%
15.7%
17.8%
22.0%
18.1%
22.9%
26.6%
19.4%
30.5%
25.6%
21.0%
28.1%
24.1%
33.0%
FFB Purchased
Milling
30.3%
6.2%
36.5%
5.6%
23.3%
7.9%
16.7%
6.1%
10.0%
4.9%
4.16
20.93
4.61
21.95
3.76
19.92
4.23
21.51
3.64
17.82
312
1,566
388
1,848
359
1,906
451
2,293
414
2,029
3.38
323
3.90
416
3.46
394
C ost as a % of total
U nit Cash Costs
(IDR mn)
IDR/ton CPO - Total
IDR/Mature Ha*
(USD)
USD/ton CPO - Total
USD/Mature Ha*
*Excluding Milling Costs
U nit Cash Costs from Internal FFB Only
IDR/ton CPO
USD/ton CPO
3.64
272
3.73
314
U nit Cash Costs from Internal FFB, net of revenues for FFB, PK & PKO
IDR/ton CPO - net
USD/ton CPO - net
Avg IDR/USD Rate
3.00
224
3.00
253
3.04
291
3.45
367
2.97
338
13,360
11,878
10,451
9,380
8,779
Cash costs per mature hectare improved
by nearly 5% to Rp20.9 million.
P alm Oil Financ ial Summary (I DR bn) Q 4- 2015 Q 3- 2015 Q o Q Δ%
Revenue
Gross Profit
% margin
Operating Profit
% margin
EBITDA
% margin
Profit Before Tax
% margin
12
824
363
44.0
300
36.3
362
43.9
274
33.2
716
201
28.1
106
14.8
171
23.9
46
6.4
15.1
80.4
182.7
111.8
499.8
Our total cash cost
declined by Rp113
billion in 2015, on falling
FFB purchases and
Other expenses.
We produced CPO at a
cash cost of Rp4.16
million per ton, for a 10%
improvement over 2014.
Excluding the costs of
purchasing and milling
3rd party FFB, our cost
per ton was just Rp3.64
million.
If we also net off the
revenues derived from
the sale of FFB, Palm
Kernel and Palm Kernel
Oil, our cash cost per
ton declines further, to
Rp3.0 million, consistent
with the previous two
years.
2 015
3,055
1,106
36.2
788
25.8
1,043
34.1
611
20.0
2 014* Y o Y Δ%
3,525
1,509
42.8
1,166
33.1
1,376
39.0
1,051
29.8
(13.3)
(26.7)
(32.4)
(24.2)
(41.9)
2 013
2,478
1,046
42.2
707
28.5
885
35.7
517
20.9
PT Dharma Satya Nusantara Tbk (DSNG.JK)
DSN is also a leading
ng w
wood products manufacturer with reputable
brand names & long
g-standing
client relationships
We are the 4th largest wood
products manufacturer in
Indonesia, producing panels,
engineered floors and doors.
Recent acquisitions and JVs
are shifting our product mix
into higher margin engineered
flooring and doors.
We have sufficient capacity to
meet our current growth plans,
but will be enhancing our
efficiency by consolidating
W ood P roduc t s Operat ing Summary
Q4-2015
operations from Surabaya and
Gresik to a new processing
plant in Lumajang by 2015,
thereby reducing our
transportation costs.
We comply with numerous
international environmental
standards, and seek to ensure
that all logs and sawn timber
purchased for our operations
are sourced from sustainable
forest resources.
Q3-2015
QoQ Δ%
2015
2014
YoY Δ%
2013
Sales Volume
Panel (m3)
34,263
38,905
(11.9)
179,567
201,696
(11.0)
Engineered doors (pcs)
18,325
16,754
9.4
61,948
51,469
20.4
51,989
Engineered floors (m2)
282,246
298,926
(5.6)
1,098,251
1,145,956
(4.2)
1,073,412
244,642
Average Selling Price (IDR mn)
3.6
4.68
4.37
7.2
3.97
Engineered doors (pcs)
1.06
1.11
(3.9)
1.25
1.24
1.1
1.06
Engineered floors (m2)
0.39
0.44
(11.1)
0.41
0.37
11.4
0.31
Q4-2015
Q3-2015
QoQ Δ%
2015
2014*
YoY Δ%
2013
300
337
(10.9)
1,370
1,374
(0.2)
1,364
27
(33)
(180.5)
69
200
(65.3)
144
8.9
(9.8)
5.1
14.6
0.0
10.5
Panel (m3)
4.95
4.78
Wood P roduc t s Financ ial Summary (I DR bn)
Revenue
Gross Profit
% margin
Operating Profit
% margin
EBITDA
% margin
Profit Before Tax
% margin
50
(40)
16.6
(12.0)
63
(27)
21.1
(8.0)
54
(78)
18.0
(23.3)
Full Year 2015 Operating Results Update
(223.7)
51
11
374.6
20
3.7
0.8
0.0
1.5
(334.3)
104
64
61.6
73
7.6
4.7
0.0
5.4
(30)
(41)
(27.8)
(2.2)
(3.0)
(168.8)
(80)
(5.9)
13
Full Year 2015 Financial Summary
T ot al C ons olidat ed (I DR bn)
Q 4-2015 Q 3-2015 Q oQ Δ%
Revenue
Gross Profit
% margin
Operating Profit
% margin
EBITDA
% margin
Net Profit
% margin
Forex gain (loss) from financing
Exceptional item
Adjusted Profit**
% margin
Cash flow from operations
Cash flow from investments
Cash flow from financing
T ot al P alm Oil (I DR bn)
1,125
389
34.6
300
26.7
376
33.4
177
15.7
34
45
118
10.5
1,053
168
16.0
51
4.9
130
12.3
(49)
(4.6)
(55)
51
(45)
(4.3)
198
(132)
254
94
(198)
41
824
363
44.0
300
36.3
362
43.9
274
33.2
Tot al Wood P roduc t s (I DR bn)
190.4
(463.5)
(360.7)
110.8
(33.2)
527.1
716
201
28.1
106
14.8
171
23.9
46
6.4
15.1
80.4
182.7
111.8
499.8
Q4- 2015 Q3- 2015 Qo Q Δ%
Revenue
Gross Profit
% margin
Operating Profit
% margin
EBITDA
% margin
Profit Before Tax
% margin
300
27
8.9
50
16.6
63
21.1
54
18.0
Financ ial P os it ion
337
(33)
(9.8)
(40)
(12.0)
(27)
(8.0)
(78)
(23.3)
(10.9)
(180.5)
(223.7)
(334.3)
(168.8)
Q4- 2015 Q3- 2015 Qo Q Δ%
Total debt
Net debt
Total Asset
Total Equity
Total debt / equity
Net debt / equity
Net debt / EBITDA
4,321
3,299
7,853
2,507
1.7x
1.3x
3.2x
* Restated
3,919
3,346
7,454
2,287
1.7x
1.5x
3.4x
10.2
-1.4
5.4
9.6
2 015
2 014*
Y oY Δ%
2 013
2 012
4,425
1,175
26.6
730
16.5
1,039
23.5
303
6.8
(71)
128
259
5.9
4,898
1,709
34.9
1,075
22.0
1,339
27.3
650
13.3
(12)
(69)
711
14.5
(9.7)
(31.3)
3,842
1,190
31.0
657
17.1
888
23.1
216
5.6
(184)
3,411
961
28.2
494
14.5
666
19.5
252
7.4
(34)
(63.5)
354
9.2
278
8.2
239
(699)
193
997
(885)
593
(76.0)
(21.1)
(67.4)
595
(745)
96
149
(826)
488
2015
2014*
Y o Y Δ%
2013
2012
3,055
1,106
36.2
788
25.8
1,043
34.1
611
20.0
3,525
1,509
42.8
1,166
33.1
1,376
39.0
1,051
29.8
(13.3)
(26.7)
2,478
1,046
42.2
707
28.5
885
35.7
517
20.9
1,997
820
41.1
496
24.8
614
30.8
416
20.9
2015
2014*
Y o Y Δ%
2013
2012
1,370
69
5.1
51
3.7
104
7.6
(30)
(2.2)
1,374
200
14.6
11
0.8
64
4.7
(41)
(3.0)
(0.2)
(65.3)
1,364
144
10.5
20
1.5
73
5.4
(80)
(5.9)
1,414
141
10.0
70
4.9
123
8.7
33
2.3
(32.1)
(22.4)
(53.4)
498.3
(32.4)
(24.2)
(41.9)
374.6
61.6
(27.8)
2015
2014*
Y o Y Δ%
2013
2012
4,321
3,299
7,853
2,507
1.7x
1.3x
3.2x
3,532
2,408
7,174
2,293
1.5x
1.0x
1.8x
22.3
37.0
9.5
9.3
2,961
2,474
5,921
1,679
1.8x
1.5x
2.8x
2,733
2,195
5,141
1,406
1.9x
1.6x
3.3x
** Consolidated adjusted profit excludes the impact of unrealized financing forex gains/losses
I D R Bn
US$ MM
Revolving Loan
Current Portion of LT Debt
Long Term Debt
Finance Leases
538
303
2,816
4
28.9
9.7
9.2
0.1
Total
3,661
47.8
14
486.0
Q 4- 2015 Q3- 2015 Qo Q Δ%
Revenue
Gross Profit
% margin
Operating Profit
% margin
EBITDA
% margin
Profit Before Tax
% margin
Loans by C urrenc y, FY2015
6.8
131.6
Note: Annual Financial Statements are
audited by Siddharta & Wijaja, Registered
Public Accountants - a Member Firm of
KPMG International.
PT Dharma Satya Nusantara Tbk (DSNG.JK)
Full Year 2015 Operations Summary
Full Year 2015 Operating Results Update
15
DSNG Daily Share Price (rp/share) & Trading Volume (shares)
1,000
750
500
250
0
For additional information,
please refer to our website at:
14-Jun-13
14-Dec-13
14-Jun-14
14-Dec-14
14-Jun-15
www.dsn.co.id
14-Dec-15
If you have additional
questions or requests, you may
contact us at:
DSNG Share Price vs. IDX & Agri Index
3.0
2.5
DSNG
2.0
investor.relations@dsngroup.co.id
1.5
Agri
1.0
IDX
0.5
0.0
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14-Dec-15
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