SMGR Corp Material Presentation_ December 2009.

(1)

CEMENTING

USTAINABLE ROWTH

DECEMBER 2009

(2)

AGENDA

I. Indonesia: Country & Cement Industry Profile

II. Corporat e Prof ile

III. Market Updat e

IV. Financial Updat e

V. St rat egic Proj ect s

VI. Environment al Focus

VII. Fut ure of Indonesia’ s Cement Indust ry

VIII. Appendix

(3)

2 THE COUNTRY & INDONESIAN CEMENT INDUSTRY AT A GLANCE

GEOGRAPHY



Area

: 1, 922, 570 km



Capit al Cit y

: Jakart a



Number of Isl ands

: More t han 8, 500 isl ands



Signif icant Isl ands

: Java, Sumat era, Kal imant an Sul awesi, Papua

DEMOGRAPHY

• Popul at ions (June 2009)

: 230 Mil l ions

• Popul at ion Growt h

: 1. 3% p. a.

ECONOMY

2008

2009F

_2010F

• GDP Per Capit a

_:

• Annual GDP Growt h

:

• Annual Inf l at ion rat e

:

• BI Rat e (year end)

:

• US$ Exchange Rat e (year end) :

CEMENT INDUSTRY

2008

2009F

_2010F

• Product ion Capacit y

:

• Domest ic Growt h

:

• Domest ic Ut il izat ion

:

• Supply



Domest ic

:



Export

:



Import

_:

2, 324 US$

6. 1%

11. 0%

9. 3%

Rp10, 950

2, 193 US$

4. 5%

3. 9%

6. 5%

Rp9, 700

2, 616 US$

5. 4%

5. 9%

6. 7%

Rp9, 549

46. 62 mio t ons

11. 5%

82%

38. 09 mio

t ons

4. 93 mio t ons

1. 53 mio t ons

51. 00 mio t ons

0%

75%

38. 09 mio

t ons

4. 50 mio t ons

-52. 50 mio t ons

5. 0%

76%

40. 00 mio

t ons

3. 60 mio t ons

-1) Based on median of Cit y, Danareksa & Bahana Resear ch Inst it ut e 2) Based on Cit igroup Gl obal Market Research

3) Based on Deut sche’ s f orecast

(4)

Singapore Kual a Lumpur

SGG

1

2

3

4

5

6

7

8

9 Semen Andalas Indonesia

Lhok Nga, Nanggroe Aceh D.

Cap. 1.6 mn tons

(under reconstruction)

Indocement Tunggal Perkasa

Jakarta

Cap. 17.1 mn tons

Semen Tonasa

South Sulawesi, Cap. 3.5 mn tons

Semen Padang

West Sumatera, Cap. 5.9 mn tons

Holcim Indonesia

Jakarta

Cap. 7.9 mn tons

Semen Bosowa Maros

Maros, South Sulawesi

Cap. 1.8 mn tons

Semen Baturaja

Palembang, South Sumatera

Cap. 1.25 mn tons

Semen Gresik

East Java, Cap. 8.6 mn tons

_{Semen Kupang}

Kupang, East Nusa Tenggara

Cap. 0.57 mn tons

1.

2.

3.

4.

5.

6.

7.

8.

9. INDUSTRY STRUCTURE AND PLANTS LOCATION

PT Semen Gresik (Persero) Tbk.

Total Cap. 18,0 mn tons

PT Semen Gresik (Persero) Tbk.

Total Cap. 18,0 mn tons

(5)

4 SGG

*)

: HIGHEST OVERALL CAPACITY AND CAPACITY UTILIZATION IN INDONESIA



SGG has highest overal l capacit y



The ut il izat ion rat es are t he best in

t he l ocal indust ry



Wide geogr aphical cover age t hrough

dispersed f act ories

COMPARISON WITH PEERS (2008 Cement Product ion – Domest ic Ut il izat ion)

82%

46, 620, 000

-INDUSTRY

66%

3, 620, 000

-Ot hers

67%

7, 900, 000

Narogong and Cil acap (Cent ral Java)

Hol cim

70%

17, 100, 000

Cit eureup (West Java), Tarj un (Sout h Kal imant an)

Indocement TP

92%

18, 000, 000

Java, Sumatera, Sulawesi

SGG Total Capacity

91%

3, 500, 000

Pangkep (Sout h Sul awesi )

• Semen Tonasa

87%

5, 900, 000

Indarung (West Sumat era)

• Semen Padang

97%

8, 600, 000

Gresik & Tuban (East Java)

• Semen Gresik

Ut ilization (%)

Capacit y (t ons)

Locat ion

Company

KEY HIGHLIGHTS

_{Semen Gresik Group}

(6)

AGENDA

I. Indonesia: Count ry & Cement Indust ry Prof il e

II. Corporate Profile

III. Market Updat e

IV. Financial Updat e

V. St rat egic Proj ect s

VI. Environment al Focus

VII. Fut ure of Indonesia’ s Cement Indust ry

VIII. Appendix

(7)

6 

1957: Inaugurat ion of Gresik I



1991: Init ial Publ ic Of f ering, Market Cap IDR0. 63t n, resul t ing sharehol ding post IPO:

• Government of Republ ic of Indonesia: 73%

• Publ ic: 27%



1995: Acquisit ion of PT Semen Padang (Persero) and PT Semen Tonasa (Persero)



1998: Cemex became a st rat egic part ner by buying a 14% st ake, Market Cap IDR 4. 9t n



1999: Cemex upsized it s st ake t o 25% by end 1999



2005: Tot al inst all ed product ion capacit y: 16. 92mm t . p. a. , Market Cap IDR 10. 6t n



2006: Bl ue Vall ey Hol dings bought Cemex’ s 24. 9% st ake in SGG, Market Cap IDR 21. 5t n



2008: Tot al Inst al l ed Capacit y: 18. 00mm t . p. a, Market Cap IDR 24. 8t n



2009: Target ed t ot al inst all ed cap: 19. 00mm, Market Cap per Sept 30, 2009: IDR 37. 4t n

Bl ue Val l ey Hol dings Pt e.

Lt d. (24. 90%)

Publ ic

(24. 09%)

The Government of t he Republ ic of Indonesia

(51. 01%)

PT Semen Gresik (Persero) Tbk.

PT Semen Padang

(99. 99%)

PT Semen Tonasa

(99. 99%)

Six subsidiaries

Non-cement producers

BRIEF HISTORY

OWNERSHIP STRUCTURE

SGG IS THE #1 CEMENT COMPANY IN INDONESIA

¹ As Sept 30, 2009

0,0

5,0

10,0

15,0

20,0

19

57

19

80

19

80

19

84

19

85

19

86

19

94

19

96

19

97

19

98

20

06

20

07

20

08

20

09 SGG CAPACITY BUILD-OUT (MM TONS)

Current capacity =

19. 0 mm tons

Five subsidiaries

Non-cement producers

(8)

SGG’ s COMPARATIVE & COMPETITIVE ADVANTAGE

Broadest footprint of

plants and distributors

in Indonesia

GEOGRAPHIC SCOPE

Superior product quality

through production and

operational excellence

TECHNICAL CAPABILITIES

Highest plants ut ilisation

in Indonesia

ASSET UTILISATION

Deep relationships with

distributors to serve t he

retail and bulk markets

DISTRIBUTION NETWORK

Superior customer

service via consistency in

product and delivery

CUSTOMER REPUTATION

High operating margins

plus disciplined financial

management

FINANCIAL STRENGTH

SGG

(9)

8 BY ADOPTING THE MARKET LEADERSHIP POSITION IN INDONESIA, SGG HAS

DRIVEN SIGNIFICANT VALUE INCREASE

Cost leadership

EBITDA

Distribution leadership

Market share

Brand leadership

Price

(10)

AGENDA

I. Indonesia: Count ry & Cement Indust ry Prof il e

II. Corporat e Prof ile

III. Market Update

IV. Financial Updat e

V. St rat egic Proj ect s

VI. Environment al Focus

VII. Fut ure of Indonesia’ s Cement Indust ry

VIII. Appendix

(11)

10 MARKET UPDATE (Cement Sales up to 11M2009)

0. 1

16, 185, 671

16, 207, 110

GRAND

TOTAL

(36. 0)

955, 490

611, 369

Total Export

(47. 1)

105, 093

55, 548

- Tonasa

(34. 6)

850, 397

555, 821

- Padang

-- Gresik

EXPORT:

2. 4

15, 230, 181

15, 595, 741

Total

Domestic

15. 0

2, 919, 880

3, 359, 072

- Tonasa

(2. 8)

4, 677, 286

4, 546, 974

- Padang

0. 7

7, 633, 015

7, 689, 695

- Gresik

DOMESTIC:

CHANGE

(%)

11M2008

11M2009

DESCRIPTION

SMGR Sales Volume (Tons)

(17. 6)

664, 336

547, 566

Yogyakart a

(1. 5)

4, 720, 217

4, 649, 905

East Java

(3. 0)

39, 550, 049

38, 375, 351

GRAND

TOTAL

(17. 5)

4, 587, 481

3, 784, 539

Total Export

(14. 6)

3, 039, 098

2, 593, 913

Export Cl inker

(23. 1)

1, 548, 383

1, 190, 626

Export Semen

(1. 1)

34, 962, 568

34, 590, 812

TOTAL

INDONESIA

(5. 0)

788, 009

748, 612

Mal uku & Papua

4. 6

1, 867, 585

1, 954, 407

Nusa Tenggara

(1. 9)

2, 257, 217

2, 214, 885

Kal imant an

15. 1

2, 388, 888

2, 748, 465

Sul awesi

(3. 0)

8, 185, 752

7, 940, 570

Sumat era

(2. 5)

19, 475, 117

18, 983, 872

Total Java

1. 4

3, 983, 143

4, 037, 694

Cent ral Java

0. 5

4, 902, 994

4, 928, 837

West Java

(12. 2)

1, 880, 806

1, 650, 642

Bant en

(4. 6)

3, 323, 621

3, 169, 228

Jakart a

CHANGE

(%)

11M2008

11M2009

DESCRIPTION

(12)

MARKET BY GEOGRAPHY (11M2009)

Domest ic Consumption – Java remains as t he

largest market

23%

8%

6%

2%

East of Indonesia

Nusa Tenggara

Kalimantan

Sulawesi

Java

55%

Sumatera

Indocement

Domest ic Market Share

Sour ce: ASI (Indonesi a Cement Associ at ion)

TOTAL INDONESIA

45. 2

29. 9

13. 5

11. 3

8. 0

1. 1

11. 7

79. 1

6. EASTERN IND.

14. 4

3. 0

39. 7

42. 8

5. NUSA TENGGARA

9. 0

6. 9

24. 6

59. 3

4. KALIMANTAN

20. 5

0. 1

13. 7

65. 6

3. SULAWESI

30. 5

8. 4

15. 3

45. 7

2. SUMATERA

2. 0

19. 9

38. 7

39. 3

1. JAVA

OTHERS

HOLCIM

INTP

SMGR

MARKET SHARE (%)

REGION



SG

SP

ST

1

2

3

4

5

6

(13)

12 AGENDA

I. Indonesia: Count ry & Cement Indust ry Prof il e

II. Corporat e Prof ile

III. Market Updat e

IV. Financial Update

V. St rat egic Proj ect s

VI. Environment al Focus

VII. Fut ure of Indonesia’ s Cement Indust ry

VIII. Appendix

(14)

22.3 9,213

7,530

Total Equity

22.1 11,735

9,610

Total Assets

34.4 2,408

1,791

Net Income

21.4 3,379

2,783

EBITDA

12.6 5,647

5,014

Cost of Revenue

25.7 4,757

3,784

Gross Profit

36.0

410

302 EPS (full amount)

27.7 3,059

2,396

Operating Income

22.3 1,698

1,388

Operating Expenses

18.3 10,404

8,798

Net Revenue

Change

(%)

9M09

9M08

(restated)

Description

(Rp bn)

FINANCIAL SUMMARY (9M2009 RESULTS)

EBITDA (Rp bil l ion)

EBITDA Margin (%)

32. 5%

31. 6%

29. 2%

27. 1%

26. 0%

9M09

9M08

9M07

9M06

9M05

3.379

2.783

2.063

1.760

1.422 1000

1500

2000

2500

3000

3500

9M05

9M06

9M07

9M08

9M09

NET INCOME (Rp bil l ion)

2.408

706

1.027

1.272

1.791

400

800 1200

1600

2000

2400

9M05

9M06

9M07

9M08

9M09

NET INCOME Margin (%)

23. 1%

20. 3%

17. 9%

15. 8%

12. 9%

9M09

9M08

9M07

9M06

9M05

(15)

14 FOCUS ON REVENUE AND COST MANAGEMENT

435,376

116,431

60,528

42,152

63,627

113,606

39,031

9M09

14.4 380,692

COGS

24.0 91,618

Fuel

19.3 50,753

Transport.

13.9 102,249

Other

(1.5)

42,801

Maintenance

5.8 60,142

Electricity

17.8 33,128

Packaging

CHANGE

(%)

9M08

COGS / Ton

250000

350000

450000

550000

650000

750000

850000

3M2008

6M2008

9M2008

FY2008

3M2009

6M2009

9M2009

Domest ic ASP 2008/2009

COGS per ton 2008/2009

816,240

9M09

19.4 683,660

Rp/Ton

CHANGE

(%)

9M08

Domestic

Revenue/Ton

(16)

7532

8728

9601

12210

2892

3328

4001

5355

965 2397

1412

6068

2061

1539

1779

3387

1999

2234

2849

3867

509 1002

1296

1775

2524

0 2000

4000

6000

8000

10000

12000

2004

2005

2006

2007

2008

Reve nue

Gross Profit

Ope rating Profit

Ebitda

Net Profit

22%

12%

49%

29%

37%

27%

19%

CAGR

(2004 – 2008)

Total Equity

Total assets

Net profit

EBITDA

Operating profit

Gross Profit

Revenue

(Rp billions)

(17)

16 CONSISTENT REVENUE GROWTH WITH STRONG BALANCE SHEET

Revenue—last 5 years (IDR bn)

Sales volumes—last 5 years (mm t ons)

Cash balance (IDR bn)

Total debt (IDR bn)

5, 614

6,933

8,163

8, 948

11,760

454

599

565

653

450 2004

2005

2006

2007

2008

Domest ic Sales

Expor t Sales

_CAGR (04—08)

(0. 2%)

20%

13.3 14.3 15.0 15.2

16.7

2.3 2.1 1.8

1.8 1.0

2004

2005

2006

2007

2008

Domest ic Expor t

(19%)

CAGR (04—08)

Not e: Sales volumes include cement and clinker volumes

1, 929

3, 836

2, 939

908 1, 424

2004

2005

2006

2007

2008

CAGR

(04—0

8) 43%

180 1,217

854

224

159 2004

2005

2006

2007

2008

CAGR (04

_{—08) -38%}

(18)

SOLID CREDIT METRICS

Debt/ EBITDA

EBITDA/ int erest

27.8x

245.0x

12.7x

5.9x

147.6x

2004

2005

2006

2007

2008

Debt/ capital

11%

12%

_9%

66%

46%

2004

2005

2006

2007

2008

Debt/ equit y

0.19x

0.33x

0.02x

0.04x

_0.02x

2004

2005

2006

2007

2008

0.40x

0.90x

0.05x

0.10x

_0.06x

(19)

18

*) Adj ust ed t o st ock split 1: 10 on August 2007 Source: I/ B/ E/ S mean est imat es

Not e: Act ual numbers are report ed number on t he year of announcement

SUSTAINABLE EPS GROWTH VS. ANALYST ESTIMATES

SGG HAS BEEN ABLE TO OUTPERFORM MARKET EXPECTATIONS

ACT

UAL

EP

S C

AGR

(20

02-

200 8):

6 0%

5 9

_{5 1 , 4}

74 , 3

1 2 1

2 1 5

2 8 3

3 55

2 6

63 8 6

1 6 9

21 8

2 99

4 2 6

0 5 0

10 0

15 0

20 0

25 0

30 0

35 0

40 0

2 0 0 2

2 0 0 3

2 00 4

2 0 0 5

20 0 6

2 0 0 7

2 0 08

20 0 9

Consensus analyst EPS forecasts

Actual EPS

(20)

1,7%

2,5%

3,0%

_2,7%

5,2%

2004

2005

2006

2007

2008

Average: 3, 0%

_{5, 4%}

3, 1%

5, 2%

JSX

T o p

**-20 * )**

INT P

SMCB

SGG

SGG DIVIDEND YIELD IN THE LAST 5 YEARS

Not e: Based on median of Top-20 JSX list ed companies in dividend yield, excluding Semen Gresik f or FY2008

2008 DIVIDEND YIELD

REGULAR DIVIDENDS



Key det erminant s of dividend pol icy:



Hist orical dividend payout t rends



Comparison wit h peers



Proj ect ed cash-f l ows avail abl e f or dividends (af t er t aking int o account

pot ent ial expansionary capex et c)



Anal yst and invest or expect at ions



Shareholder prof il e

SGG HAS BEEN ABLE TO DELIVER HIGH DIVIDEND YIELD

1)_{shares price}

based on closing price at t he end of year

(21)

20 AGENDA

I. Indonesia: Count ry & Cement Indust ry Prof il e

II. Corporat e Prof ile

III. Market Updat e

IV. Financial Updat e

V. Strategic Proj ects

VI. Environment al Focus

VII. Fut ure of Indonesia’ s Cement Indust ry

VIII. Appendix

(22)

INVESTMENT COSTS OF STRATEGIC PROJECTS

US$ 708

TOTAL CAPEX

1. 63

114

70 Sub Total

1. 63

2011

2008

114 2 x 35

Sul awesi

Completed

Start

Investment US$

mn/ MW

Construction

Investment

(US$ mn)

Capacity

(MW)

Power Plants

Location

119

594 5. 0

Sub Total

116 2011

2008

290 2. 5

Sul awesi

122 2012

2008

304 2. 5

Java

Completed

Start

Investment

US$/ Tons

Construction

Investment

(US$ mn)

Capacity

(mn tons)

New Plants

Location

(23)

22 PROGRESS OF CEMENT & POWER PLANTS PROJECT - St at us of OCT 15, 2009

Description

Weight

Planning

Actual

Preparat ion

1. 57%

48. 55%

49. 28%

Management

3. 05%

18. 22%

27. 94%

Engineering

4. 53%

15. 38%

28. 40%

Procurement

60. 19%

15. 47%

15. 15%

Const ruct ion

28. 67%

2. 44%

0. 97%

Commissioning

1. 99%

0. 00%

Total

100 %

12. 03%

12. 31%

Progress of Tonasa V Cement Plant Proj ect

Description

Weight

Planning

Actual

Preparat ion

3. 09%

23. 16%

21. 84%

Management

3. 45%

20. 31%

18. 17%

Engineering

4. 35%

16. 08%

14. 02%

Procurement

59. 97%

10. 46%

11. 69%

Const ruct ion

27. 27%

0. 95%

0. 82%

Commissioning

1. 88%

0. 00%

Total

100 %

8. 65%

9. 15%

Progress of Tuban IV Cement Plant Proj ect

Descript ion

Weight

Planning

Actual

Preparat ion

5. 00

30. 60%

30. 00%

Management

5. 00

16. 00%

Engineering

4. 00

26. 50%

26. 50 %

Procurement

45. 0

0. 08%

0. 078%

Const ruct ion

35. 0

0. 00%

Commissioning

6. 00

0. 00%

Total

100 3. 42%

3. 39%

Progress of Power Plant Proj ect - Tonasa 2 x 35 MW

(24)

PROJECTION PRODUCTION CAPACITY (Mio Ton)

20. 0

24. 0

27. 0

11. 1

8.2 _8.6

9. 0

9.1

9.4

13.2 6 .7

6.4

6.3

5.4

5.9

6.3

4.1 4. 1

3. 5

3.5

4.3

6.5

7.1 2007

2008

2009F

2010F

2011F

2012F

2013F

SG

SP

ST

17. 1

18. 0

(25)

24 Det ailed capex schedule (US$ mm)

Uses of funds

0.67

6

4.82

2

6

5

6

37 37 41

31 5 68 264 230 27 14 24 66 5 5 6 8 7 7 7 4 40 222 402 383 102 56 57

3

9 29

₇

26

59 2 2

2008

2009

2010

2011

2012

2013

2014

HCMP & ICT Mandat or y

Power plant s (under r eview) Capac it y exp.

Ot her s

Keep Per f or manc e Eff ic ienc y Impr ovement De-bot t lenec king

CAPEX PLANNING PROFILE (2008 – 2014)

5%

4%

8%

30%

32%

18%

3%

%

2014

2013

2012

2011

2010

2009

2008

Key Items (Capex)

(US$ Mio)

Capaci t y Expansi on

594 Power Plant s

114 De-bot t lenecking

106 Human Capi t al Mast er Plan & ICT

40 Ot hers

101 Keep Perf ormance

227 Ef f i ciency Improvement

35 Mandat ory

45

(26)

AGENDA

I. Indonesia: Count ry & Cement Indust ry Prof il e

II. Corporat e Prof ile

III. Market Updat e

IV. Financial Updat e

V. St rat egic Proj ect s

VI. Environmental Focus

VII. Fut ure of Indonesia’ s Cement Indust ry

VIII. Appendix

(27)

26 Generate revenue



Emissions reduction programs



Carbon credits trading

Environmental

Management

Reduce operating expense



Energy efficiency programs



Technology-driven cost

savings

Promote company image



Domestic capacity expansion



Investment communities

SGG IS FOCUSED ON DRIVING VALUE THROUGH AN

ENVIRONMENTALLY-SUSTAINABLE BUSINESS PLATFORM

(28)

CLEAN DEVELOPMENT MECHANISM (CDM) PROJECT

Alternative

Fuel

1. Alternative Fuel

2. Waste Heat Recovery

The use of alternative

fuel is

the company’

strategy plan in order to

improve non renewable

energy efficiency as well as

consume friendly

environmental energy.

Waste Heat Recovery Generation

Utilize exhaust (waste gas) from pre-heater & cooler

to produce electricity (power plant).

(29)

28 CDM ROAD MAP

(30)

ALTERNATIVE FUEL ROAD MAP (SEMEN GRESIK ONLY)

2009

2012

Alternative fuel 1%



Mapping alternative

Fuel source



Install feeding facilities



Procurement and

operations



Trial

Alternative fuel 2,5%



Agriculture & industry

waste



5%

Note : Facility for solid

alternative fuel, 1 unit at

Tuban-3

alternative fuel 7,5%



Agriculture & Industry

waste



7,5%

2010

2011

alternative fuel 5%



Agricul t ure &

Indust ry wast e



5%



Add facilities at

Tuban-1/2

2013

alternative fuel 10%



Agriculture & Industry

waste



10%

Not e:

CER value per t on: €10 (Rp14, 500/ €1)

Not e:

CER value per t on: €10 (Rp14, 500/ €1)

Alt ernat ive Fuel Percent age

Biomass Consumpt ion

Decrease on Coal Consumpt ion

CER Result ed

(31)

30 AGENDA

I. Indonesia: Count ry & Cement Indust ry Prof il e

II. Corporat e Prof ile

III. Market Updat e

IV. Financial Updat e

V. St rat egic Proj ect s

VI. Environment al Focus

VII. Future of Indonesia’ s Cement Industry

(32)



Pessimist

: 5. 5%



Moderate

: 6. 5%



Optimist

: 7. 0

%

Annual Growth Rates

NATIONAL DEMAND IS FORECAST TO RISE TO 142mm TONS BY 2030

*)_{Source: The St udy of Inst it ut Teknologi 10 Nopember – Surabaya (ITS)}

Indonesia Cement Market Growth 2010-2030

40

43

46

49

52

56

59

63

67

72

76

81

86

92

98

104

111

118

125

133

142

117

163

0

20

40

60

80

100

120

140

160

180 2010

2015

2020

2025

2030

Pessimist

Moderate

Optimist

(33)

32

Malaysia

Timor Leste Malaysia

Malaysia

Timor Leste Timor Leste Timor Leste

21

50

10 ₃₉

20

16

7 ₁₁

Kalimantan

Sulawesi

Bali

Jawa

Sumatra

Indonesia Timur

2010

2030

Key

Figures are in MT

DEMAND IN 2010-2030 WILL INCREASINGLY SHIFT TO THE OUTER ISLANDS

*)_{Source: The St udy of Inst it ut Teknologi 10 Nopember – Surabaya (ITS)}

SGG wit h it s wide geographical presence is wel l posit ioned t o t ap t he growt h

t hroughout Indonesia

(34)



Distribution warehouses in all areas of Java, Bali, Sumatra, Kalimantan, Sulawesi and Irian



15 large packing plants



Nationwide distribution network



Operate 4 special sea ports: Padang, Tuban, Gresik, Biringkassi



Total installed cap. EoY 2007: 17.1 mn tons and EoY 2008: 18.0 mn tons

SGG’ s PRODUCTION FACILITIES ARE WELL SUPPORTED BY STRATEGICALLY

LOCATED MARKETING AND DISTRIBUTION FACILITIES (2008)

Teluk Bayur Sumatera Kalimantan Sulawesi Maluku Papua Lombok Bali Java Bat am Ciwandan

Tanj ung Pr iok _{Jakart a}

Samar inda

Banj ar masin

Palu Bit ung Ambon Makassar Bir ingkasi Bali Tabanan Denpasar Singar aj an DI Yogyakart a

Lempuyangan Jant i Cent ral Java

Tegal Pur woker t o

Kudus Magelang Solo/ Palur Alas Tuwo Moj opahit Sayung West Java

Ser ang Tanger ang Bogor Cibit ung Bandung Tasik Malaya Cir ebon Nar ogong Belawan Singapore Kual a Lumpur

Tuban

Surabaya

Cement Plant Packing Plant Port

Warehouse

East Java Mar gomulyo Tanj ung Wangi

Bangkalan Swabina Aleh

Pelabuhan Tuban

Pelabuhan Gr esik

Installed Cap.:

5.9 mn tons

Installed Cap.:

8.6 mn tons

Installed Cap.:

3.5 mn tons

(35)

34 SGG LONG TERM STRATEGIC FOCUS

SGG

THE OVERALL

STRATEGY

COMBINES

6 CRITICAL

ELEMENTS

THE OVERALL

STRATEGY

COMBINES

6 CRITICAL

ELEMENTS

1. Undert ake Capacit y Growt h

2. Manage Energy Securit y

3. Enhance Company Image

4. Move Closer To The Cust omer

5. Enable Corporat e Growt h

6. Manage Key Risks

1. Undert ake Capacit y Growt h

2. Manage Energy Securit y

3. Enhance Company Image

4. Move Closer To The Cust omer

5. Enable Corporat e Growt h

(36)

Strong balance sheet

provides flexibility

to explore several

strategic options that

enable sust ainable

growth with

relatively lower risk

Strong operating

performance, growth

and margins

Efficient operations

with high asset

utilization

Further internal

value being

unlocked

Increasing synergies

between the

Company’ s operating

units

Market leader in a

high growth

country & industry

Clear strategy to

achieve same

Scalable production

& distribution

capabilities across

all maj or islands

Ready to tap

country-wide

growth

SGG : VALUE PROPOSITION

Enabl es t he Company t o address t he requirement s of Sharehol ders, Environment and Communit y.

Sharehol ders benef it f rom a combinat ion of current yield in t erms of good dividends and prospect s of f ut ure

capit al growt h at accept abl e risk

(37)

36 AGENDA

I. Indonesia: Count ry & Cement Indust ry Prof il e

II. Corporat e Prof ile

III. Market Updat e

IV. Financial Updat e

V. St rat egic Proj ect s

VI. Environment al Focus

VII. Fut ure of Indonesia’ s Cement Indust ry

(38)

Source: Indonesian Cement Associat ion & BPS St at ist ic (Indust rial Origin – *Const ruct ion Growt h – **GDP Growt h – 1H 2009)

INDONESIA HAS EXPERIENCED SOLID ECONOMIC AND DOMESTIC CEMENT

CONSUMPTION GROWTH

Growth

:

1.1%

Growth

:

9.7%

Growth

:

4.2%

Growth

:

1.8%

Growth

:

6.6%

Growth

:

5.8%

Growth

:

19.4%

Construction growth (RHS)

Domestic consumption (LHS)

GDP growth % (RHS)

(mio tons)

DOMESTIC CEMENT CONSUMPTION, CEMENT GROWTH, GDP GROWTH AND CONSTRUCTION GROWTH IN INDONESIA

34.0

27.2

27.5

30.2

31.5

32.1

34.2

38.1 5.6%

4.7%

5.1%

5.4%

4.4%

6.3%

6.1%

_**4.40%

11.5%

4.2%

9.7%

-1.1%

6.6%

1.8%

1.1%

5.8%

*6.30%

4.1%

5.7%

8.2%

7.3%

9.0%

_8.3%

_7.3%

-10.0

0.0

10.0

20.0

30.0

40.0 2002

2003

2004

2005

2006

2007

2008

11M2009

-10.0%

0.0%

10.0%

20.0%

30.0%

40.0%

(39)

38 Main Office:

Main Building of Semen Gresik

Jln. Veteran Gresik 61122 – Indonesia

Phone: (62-31) 3981731 -2, 3981745

Fax: (62-31) 3983209, 3972264

Representative Office:

Graha Irama Building, 11

_Floor,

Jln. HR Rasuna Said, Kuningan, Jakarta 12950 – Indonesia

Phone : (62-21) 5261174 – 5

Fax

: (62-21) 5261176

www.semengresik.com

THANK YOU

IMPORTANT NOTICE

THIS PRESENTATION IS NOT AND DOES NOT CONSTITUTE OR FORM PART OF, AND IS NOT MADE IN CONNECTION WITH, ANY OFFER FOR SALE OR SUBSCRIPTION OF OR SOLICITATION, RECOMMENDATION OR INVITATION OF ANY OFFER TO BUY OR SUBSCRIBE FOR ANY SECURITIES NOR SHALL IT OR ANY PART OF IT FORM THE BASIS OF OR BE RELIED ON IN CONNECTION WITH ANY CONTRACT, COMMITMENT OR INVESTMENT DECISION WHATSOEVER.

THE SLIDES USED IN THIS PRESENTATION ARE STRICTLY CONFIDENTIAL AND HAVE BEEN PREPARED AS A SUPPORT FOR ORAL DISCUSSIONS ONLY. THE INFORMATION CONTAINED IN THIS PRESENTATION IS BEING PRESENTED TO YOU SOLELY FOR YOUR INFORMATION AND MAY NOT BE REPRODUCED OR REDISTRIBUTED TO ANY OTHER PERSON, IN WHOLE OR IN PART.

This presentation includes forward-looking statements, which are based on current expectations and forecast about future events. Such statements involve known / unknown risks uncertainties and other factors, which could cause actual results to differ materially from historical results or those anticipated. Such factors include, among others:

● economic, social and political conditions in Indonesia, and the impact such conditions have on construction and infrastructure spending in Indonesia;

● the effects of competition;

● the effects of changes in laws, regulations, taxation or accounting standards or practices;

● acquisitions, divestitures and various business opportunities that we may pursue;

● changes or volatility in inflation, interest rates and foreign exchange rates;

● accidents, natural disasters or outbreaks of infectious diseases, such as avian influenza, in our markets;

● labor unrest or other similar situations; and

● the outcome of pending or threatened litigation.

We can give no assurance that our expectations will be attained.

DISCLAIMER

The information contained in this report has been taken from sources which we deem reliable. However, none of PT Semen Gresik (Persero) Tbk and/or its affiliated companies and/or their respective employees and/or agents make any representation or warranty (express or implied) or accepts any responsibility or liability as to, or in relation to, the accuracy or completeness of the information and opinions contained in this report or as to any information contained in this report or any other such information or opinions remaining unchanged after the issue thereof.

We expressly disclaim any responsibility or liability (express or implied) of PT Semen Gresik (Persero) Tbk, its affiliated companies and their respective employees and agents whatsoever and howsoever arising (including, without limitation for any claim, proceedings, action, suits, losses, expenses, damages or costs) which may be brought against or suffered by any person as a result of acting in reliance upon the whole or any part of the contents of this report and neither PT Semen Gresik (Persero) Tbk, its affiliated companies or their respective employees or agents accepts liability for any errors, omission or mis-statements, negligent or otherwise, in the report and any liability in respect of the report or any inaccuracy therein or omission therefrom which might otherwise arise is hereby expresses disclaimed.

(1)



SGG’ s PRODUCTION FACILITIES ARE WELL SUPPORTED BY STRATEGICALLY

LOCATED MARKETING AND DISTRIBUTION FACILITIES (2008)

Teluk Bayur Sumatera Kalimantan Sulawesi Maluku Papua Lombok Bali Java Bat am Ciwandan

Tanj ung Pr iok _{Jakart a}

Samar inda

Banj ar masin

Palu Bit ung Ambon Makassar Bir ingkasi Bali Tabanan Denpasar Singar aj an DI Yogyakart a

Lempuyangan Jant i Cent ral Java

Tegal Pur woker t o

Kudus Magelang Solo/ Palur Alas Tuwo Moj opahit Sayung West Java

Ser ang Tanger ang Bogor Cibit ung Bandung Tasik Malaya Cir ebon Nar ogong Belawan Singapore Kual a Lumpur

Tuban

Surabaya

Cement Plant Packing Plant

Port Warehouse

East Java Mar gomulyo Tanj ung Wangi

Bangkalan Swabina Aleh

Pelabuhan Tuban

Pelabuhan Gr esik

Installed Cap.:

5.9 mn tons

Installed Cap.:

8.6 mn tons

Installed Cap.:

3.5 mn tons

(2)

SGG LONG TERM STRATEGIC FOCUS

SGG

THE OVERALL

STRATEGY

COMBINES

6 CRITICAL

ELEMENTS

THE OVERALL

STRATEGY

COMBINES

6 CRITICAL

ELEMENTS

1. Undert ake Capacit y Growt h

2. Manage Energy Securit y

3. Enhance Company Image

4. Move Closer To The Cust omer

5. Enable Corporat e Growt h

6. Manage Key Risks

1. Undert ake Capacit y Growt h

2. Manage Energy Securit y

3. Enhance Company Image

4. Move Closer To The Cust omer

5. Enable Corporat e Growt h

(3)

Strong balance sheet

provides flexibility

to explore several

strategic options that

enable sust ainable

growth with

relatively lower risk

Strong operating

performance, growth

and margins

Efficient operations

with high asset

utilization

Further internal

value being

unlocked

Increasing synergies

between the

Company’ s operating

units

Market leader in a

high growth

country & industry

Clear strategy to

achieve same

Scalable production

& distribution

capabilities across

all maj or islands

Ready to tap

country-wide

growth

SGG : VALUE PROPOSITION

(4)

AGENDA

I. Indonesia: Count ry & Cement Indust ry Prof il e

II. Corporat e Prof ile

III. Market Updat e

IV. Financial Updat e

V. St rat egic Proj ect s

VI. Environment al Focus

VII. Fut ure of Indonesia’ s Cement Indust ry

(5)

INDONESIA HAS EXPERIENCED SOLID ECONOMIC AND DOMESTIC CEMENT

CONSUMPTION GROWTH

Growth

:

1.1%

Growth

:

9.7%

Growth

:

4.2%

Growth

:

1.8%

Growth

:

6.6%

Growth

:

5.8%

Growth

:

19.4%

Construction growth (RHS)

Domestic consumption (LHS)

GDP growth % (RHS)

(mio tons)

DOMESTIC CEMENT CONSUMPTION, CEMENT GROWTH, GDP GROWTH AND CONSTRUCTION GROWTH IN INDONESIA

34.0

27.2

27.5

30.2

31.5

32.1

34.2

38.1 5.6%

4.7%

5.1%

5.4%

4.4%

6.3%

6.1%

_**4.40%

11.5%

4.2%

9.7%

-1.1%

6.6%

1.8%

1.1%

5.8%

*6.30%

4.1%

5.7%

8.2%

7.3%

9.0%

_8.3%

_7.3%

0.0

10.0

20.0

30.0

40.0 0.0%

10.0%

20.0%

30.0%

40.0%

(6)

Main Office:

Main Building of Semen Gresik

Jln. Veteran Gresik 61122 – Indonesia

Phone: (62-31) 3981731 -2, 3981745

Fax: (62-31) 3983209, 3972264

Representative Office:

Graha Irama Building, 11

_Floor,

Jln. HR Rasuna Said, Kuningan, Jakarta 12950 – Indonesia

Phone : (62-21) 5261174 – 5

Fax

: (62-21) 5261176

www.semengresik.com

THANK YOU

IMPORTANT NOTICE

● economic, social and political conditions in Indonesia, and the impact such conditions have on construction and infrastructure spending in Indonesia; ● the effects of competition;

● the effects of changes in laws, regulations, taxation or accounting standards or practices; ● acquisitions, divestitures and various business opportunities that we may pursue; ● changes or volatility in inflation, interest rates and foreign exchange rates;

● accidents, natural disasters or outbreaks of infectious diseases, such as avian influenza, in our markets; ● labor unrest or other similar situations; and

● the outcome of pending or threatened litigation.

We can give no assurance that our expectations will be attained.

DISCLAIMER