SMGRCorpPresentation NDR Jan2012

(1)

Corporat e Present at ion

JANUARY 2012

THE PROSPECT OF

INDONESIAN CEMENT INDUSTRY

THE PROSPECT OF

INDONESIAN CEMENT INDUSTRY

±

41%

Domestic

Market



SP



SG

(2)

INDONESIA’ S CEMENT INDUSTRY: NOW and THE FUTURE

SMGR Corporat e Present at ion

January 2012

(3)

2 1. SMGR

22. 5 mn t on

-

Semen Padang : 6. 4 mn t on

-

Semen Gresik : 11. 4 mn t on

-

Semen Tonasa : 4. 7 mn t on

2. Semen Andalas

2)

_{1. 6 mn t on}

3. Semen Bat uraj a

1. 3 mn t on

4. Indocement TP

18. 6 mn t on

5. Holcim Indonesia

8. 5 mn t on

6. Semen Bosowa

3. 8 mn t on

7. Semen Kupang

4)

_{0. 5 mn t on}

TOTAL

56. 8 mn ton

CEMENT INDUSTRY AT A GLANCE

• Design Capacity

: 54. 4 mio ton

56. 8 mio ton

63. 9 mio ton

• Domestic Growth

: 17. 7%

5. 0%

• Domestic Utilization

: 89%

89%

83%

• Total Utilization

: 91%

90%

85%

• Supply



Domestic

: 48. 0 mio ton

50. 4 mio ton

53. 0 mio ton



Export

: 1. 2 mio ton

1. 0 mio ton

1. 5 mio ton



Import

: 1. 8 mio ton

_{1. 5 mio ton}

_{1. 0 mio ton}

1) Based on t he Company’ s f orecast

2) Import ed cement by PT Semen Andal as (1. 0 mio t on) and cl inker by Bosawa and SMGR

3) Import ed cement & cl inker

4) Semen Kupang does not produce or sel l cement in t he l ast 3 years due t o it s f inancial probl em

Singapore

Kuala Lum pur

SMGR

2

1

3

4

5

1

6

7 THE PLAYERS and CAPACITY (2012)

SMGR: 22. 5 mio ton

(38% of Industry Cap. )

CEMENT INDUSTRY

2011

2012F

1)

_2013F

1)

(4)

COMPARISON: CEMENT CONSUMPTION PER CAPITA 2010

Source: UBS; Deut sche, Indonesi a Cement Associ at i on

0

200

400

600

800 1000

1200

1400

1600

S

au

di

_A

ra

bia

C

hin

_a

S

ou

th

K

or

_ea

S

in

ga

po

re

M

ala

ys

_ia

I ta

ly

Ja

pa

_n

V

ie

tn

am

U

S

_A

Th

ail

_an

d

G

er

_m

an

_y

I n

do

ne

sia

I n

dia

Ph

ilip

_in

a

kg/ capit a

172 kg

(5)

4

Source: Indonesian Cement Associat ion & BPS St at ist ic

Growth

:

1.1%

Growth

:

9.7%

Growth

:

4.2%

Growth

:

1.8%

Growth

:

6.6%

Growth

:

5.8%

Growth

:

19.4%

Domest ic consumpt ion (LHS)

GDP growt h % (RHS)

(mio t ons)

40, 8

48, 0

39, 1

27, 2

27, 5

30, 2

31, 5

32, 1

34, 2

38, 1

6, 10%

5, 6%

4, 7%

5, 1%

5, 4%

4, 4%

6. 3%

6. 1%

4. 60%

6, 60%

6. 0%

11. 5%

4. 2%

9. 7%

2. 5%

6. 6%

1. 8%

1. 1%

5. 8%

17. 7%

0, 0

10, 0

20, 0

30, 0

40, 0

50, 0

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

0, 0%

10, 0%

20, 0%

Cement growt h % (RHS)

(F)

INDONESIA HAS EXPERIENCED SOLID ECONOMIC AND DOMESTIC CEMENT

CONSUMPTION GROWTH

(6)

DOMESTIC MARKET CONSUMPTION (2011)

Retail (residential) sector is the largest

consumer of cement in Indonesia

Bag

80%

Bulk

20%

Key Drivers of Domestic cement demand:

• National Economic Growth

• Favorable Interest Rate Environment

• Infrastructure Expansion

• Per Capita Consumption increase from

current low levels

• Ready-mix (inf rast ruct ure):

±

60%

• Fabricat or (pre-cast , f iber cement , cement based indust ry):

±

35%

• Proj ect s (mort ar, render):

±

5%

• Ready-mix (inf rast ruct ure):

±

60%

• Fabricat or (pre-cast , f iber cement , cement based indust ry):

±

35%

• Proj ect s (mort ar, render):

±

5%

• Housing:

±

90%

• Cement based indust ry:

±

10%

• Housing:

±

90%

• Cement based indust ry:

±

10%

±

(7)

21, 0

6, 5

18, 1

1, 0

16, 9

1, 9

20, 0

2, 3

22, 7

3, 0

23, 7

3, 5

23, 7

3, 8

25, 2

5, 0

25, 5

6, 0

26, 9

5, 1

28, 2

6, 0

32, 2

5, 9

32, 8

6, 2

34, 2

6, 6

39, 2

8, 8

0

5

10

15

20

25

30

35

40 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Bag Consumpt i on

Bulk Consumpt i on

SO FAR INFRASTRUCTURE EXPANSION HAS BEEN RELATIVELY SLOW

Bag and Bulk cement consumpt ion 1997 – 2011 (million t ons)

6

(8)

Region

Population

Cement

Consump-tion (ton)

Cement

Consumpt.

Per Capita

(kg)

1. JAVA

136, 563, 142

21, 996, 688

161 2. SUMATERA

50, 613, 947

9, 690, 931

191 3. SULAWESI &

MALUKU

19, 926, 385

3, 421, 522

172 4. KALIMANTAN

13, 772, 543

2, 833, 018

206 5. BALI & NUSA

TENGGARA

13, 067, 599

2, 326, 931

178 6. PAPUA

3, 612, 854

513, 287

142 Tot al Indonesia

237, 556, 470

40, 782, 377

172 MARKET BY GEOGRAPHY & CEMENT CONSUMPTION PER CAPITA (FY2011)

Papua

Bali & N T

Kalimantan

Sulawesi

Population Distribution (2010)

Sumatera

21.3%

Java

57.5.%

8.4%

5.8%

5.5%

1.5%

REGION

MARKET SHARE (%)

SMGR

INTP

SMCB

BSWA ANDLS

BTRJA

1. JAVA

36. 2

40. 7

20. 8

2. 0

-

0. 01

2. SUMATERA

43. 1

15. 5

11. 7

3. 0

16. 0

11. 0

3. SULAWESI

60. 1

13. 6

1. 1

25. 0

-

-4. KALIMANTAN

47. 6

28. 9

14. 1

9. 0

-

-5. NUSA TENGGR.

37. 2

36. 9

4. 5

19. 6

-

-6. EASTERN IND.

62. 2

17. 3

0. 5

20. 3

-

-TOTAL

INDONESIA

40. 8

31. 5

15. 6

5. 8

3. 6

2. 6



SG

SP

ST

1

2

3

4

5

6 23.0%

7.3%

7.0%

5.8%

1.6%

Java

55.2%

Sumatera

Cement Distribution (2011)

(9)

8 DOMESTIC DEMAND VS NATIONAL CAPACITY

40.800

48.000

50.400

53.000

56.200

59.600

63.120

39.100

0 1 0 .0 0 0 2 0 .0 0 0 3 0 .0 0 0 4 0 .0 0 0 5 0 .0 0 0 6 0 .0 0 0

2 0 0 9 2 0 1 0 2 0 1 1 2 0 1 2 2 0 1 3 2 0 1 4 2 0 1 5 2 0 1 6

TAHUN

INSTALLED CAPACITY REAL PRODUCTION CEMENT CONSUMPTION

2.5%

6.0%

17.7%

5.0%

Real

&

Proj ected

Growth

5.0%

6.0%

Domestic

Consumption

Domestic

Consumption

(10)

COMPANY PROFILE

SMGR Corporat e Present at ion

January 2012

(11)

10 

1957 : Inaugurat ion of Gresik I, inst al l ed capacit y of 250, 000 t on cement per annum



1991 : Init ial Publ ic Of f ering, Market Cap. : IDR0. 63t n, resul t ing sharehol ding st ruct ure 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, Market Cap. : IDR4. 9t n



2006 : Bl ue Val l ey Hol dings bought Cemex’ s 24. 9% st ake in SMGR, Market Cap. : IDR21. 5t n



2010 : In March 31, Bl ue Val l ey Hol dings sol d al l of it s st ake ownership in SMGR, Market Cap per March 31, 2010: IDR43. 3t n



2011 : Tot al inst al l ed capacit y of 20. 00mm t ons, Market Cap per Dec 30, 2011: IDR67. 9t n



2012 : Target ed t ot al inst al l ed capacit y of 22. 50mm t ons

BRIEF HISTORY

SMGR IS THE #1 CEMENT COMPANY IN INDONESIA

0,0

5,0

10,0

15,0

20,0

25,0

19

57

19

70

19

80

19

84

19

85

19

86

19

90

19

95

19

97

19

98

20

06

20

07

20

08

20

09

20

10

20

11

20

12 SMGR CAPACITY BUILD-OUT (MM TONS)

Pre-consol i dat ed capaci t y Pre-consol i dat ed capaci t y

Post -consol i dat ed capaci t y

Based capacit y: 16. 9 mio t ons

Upgrading: 3. 1 mio t ons

(12)

Public

The Government of the Republic of Indonesia

PT Semen Gresik (Persero) Tbk.

PT Semen Padang

PT Semen Tonasa

OWNERSHIP STRUCTURE

FOCUSES IN CORE BUSINESS

¹ As of Apri l 09, 2010

Four subsidiaries Non-cement producers:

51. 01%

48. 99%

99. 99%

Name

Act ivit ies

% Ownership

1. Igasar

Cement dist ribut ion

12. 00%

2. Sepat im B

General t rading, cement packaging 85. 00%

3. Bima SA

General t rading, cement packaging 80. 00%

4. SUPS

Cement Packaging

10. 00%

Six subsidiaries Non-cement producers:

Name

Act ivit ies

% Ownership

1. UTSG

Limest one & Clay Mining

55. 00%

2. IKSG

Cement Packaging

60. 00%

3. KIG

Indust rial Est at e

65. 00%

4. Swadaya Gra

St eel f abricat ion, cont ract or

25. 00%

5. Varia Usaha

Transport and general t rading

24. 90%

6. Et ernit Gresik

Building mat erials

17. 60%

(13)

12 

Tot al product ion capacit y EoY 2011: 19. 8 mn t ons and t arget t ed EoY 2012: 22. 2 mn t ons



Nat ionwide dist ribut ion net works: 361 Dist ribut ors



35 distribution warehouses in all areas of Java, Bali, Sumatra, Kalimantan, Sulawesi and Papua



Operat e 4 special sea port s: Padang, Tuban, Gresik, Biringkassi



18 large packing plants

SMGR’s PRODUCTION FACILITIES ARE WELL SUPPORTED BY STRATEGICALLY

LOCATED MARKETING AND DISTRIBUTION FACILITIES

(2011)

T eluk Bayur Sumat era Kalimant an Sulawesi Maluku Papua Lombok Bali Java Bat am Ciwandan

T anj ung Priok Jakart a

Samarinda Banj armasin Palu Bit ung Ambon Makassar Biringkasi Bali T abanan Denpasar Singaraj an DI Yogyakart a

Lempuyangan Jant i Cent ral Java T egal Purwokert o Kudus Magelang Solo/ Palur Alas T uwo Moj opahit Sayung West Java

Serang T angerang Bogor Cibit ung Bandung T asik Malaya Cirebon Narogong Belawan Singapore Kuala Lumpur T uban Surabaya

Cement Plant Packing Plant Port

Warehouse

East Java Margomulyo T anj ung Wangi Bangkalan Swabina Aceh

Pelabuhan T uban

Pelabuhan Gresik

Installed Cap.:

6.1 mn tons

Installed Cap.:

10.0 mn tons

Installed Cap.:

4.1 mn tons

(14)

3. 0%

_2.7%

5.2%

4. 1%

3.2%

2006

2007

2008

2009

2010

Average: 3, 6%

2.0%

_1.6%

3.2%

1. 0%

JSX

Top-20

*)

I NTP

SMCB

SMGR

SMGR DIVIDEND YIELD IN THE LAST 5 YEARS

*): Based on medi an of Top-20 Bi ggest Market Capi t al i zat i on JSX l i st ed compani es i n di vi dend yi el d, excl udi ng Semen Gresi k f or FY2010

2010 DIVIDEND YIELD

REGULAR DIVIDENDS



Key determinants of dividend policy:

• Historical dividend payout trends

• Comparison with peers

• Proj ected cash-flows available for dividends (after taking into account

potential expansionary capex etc)

• Analyst and investor expectations

• Shareholder profile

REGULAR DIVIDEND PAYMENTS WITH ATTRACTIVE YIELD

1)_{shares pri ce}

based on cl osi ng pri ce at t he end of year

(15)

14 MARKET UPDATE

SMGR Corporat e Present at ion

January 2012

(16)

MARKET UPDATE - Cement Consumption FY2010 and FY2011

DESCRIPTION

2010

2009

CHANGE

(%)

DOMESTIC

17, 64

17, 82

(1. 0)

EXPORT

0. 29

0, 60

(52. 9)

GRAND TOTAL

17, 93

18, 43

(2. 8)

FY 2010 – Cement Consumpt ion

(mio tons)

Java

21, 99

21, 15

4. 0

Sumat era

9, 69

8, 87

9. 2

Kalimant an

2, 83

2, 44

15. 8

Sulawesi

3, 04

3, 00

1. 5

Nusa Tenggara

2, 32

2, 18

6. 6

Maluku & Papua

0, 88

0, 80

10. 4

TOTAL IND.

40, 78

38, 46

6. 0

Export Semen

0, 77

1, 23

(37. 2)

Export Clinker

2, 10

2, 79

(24. 7)

Tot al Export

2, 88

4, 03

(28. 5)

GRAND TOTAL

43, 66

42, 49

2. 7

*) Source: Indonesia Cement Associat ion, un-audit ed figures *) Source: Indonesia Cement Associat ion, un-audit ed figures

DESCRIPTION

2011

2010

CHANGE (%)

DOMESTIC

19, 591, 300

17, 639, 686

11. 1

EXPORT

127, 148

290, 551

(56. 2)

GRAND TOTAL

19, 718, 448

17, 930, 237

10. 0

Jakart a

6, 630, 161

3, 820, 650

21. 2

Bant en

2, 779, 158

2, 091, 186

32. 9

West Java

7, 060, 905

5, 875, 212

20. 2

Cent ral Java

5, 302, 862

4, 471, 010

18. 6

Yogyakart a

762, 668

611, 889

24. 6

East Java

5, 979, 268

5, 126, 741

16. 6

Tot al Java

26, 515, 022

21, 996, 688

20. 5

Sumat era

11, 027, 719

9, 690, 931

13. 8

Kalimant an

3, 360, 842

2, 833, 018

18. 6

Sulawesi

3, 526, 632

3, 046, 896

15. 7

Nusa Tenggara

2, 779, 241

2, 326, 931

19. 4

Maluku & Papua

790, 889

887, 912

(10. 9)

TOTAL

INDONESIA

48, 000, 345

40, 782, 376

17. 7

Export Cement

252, 340

776, 297

(67. 5)

Export Clinker

999, 588

2, 106, 699

(52. 6)

Tot al Export

1, 251, 928

2, 882, 996

(56. 6)

GRAND TOTAL

49, 252, 273

43, 665, 372

12. 8

(17)

16 FINANCIAL UPDATE

SMGR Corporat e Present at ion

January 2011

(18)

FINANCIAL SUMMARY: FY2010 RESULTS

EBITDA

(Rp billion)

NET INCOME

(Rp billion)

NET INCOME

(Rp billion)

EBITDA Margin

(%)

EBITDA Margin

(%)

FY06

FY07

FY08

FY09

FY10

25. 6

29. 7

31. 7

33. 2

34. 6

NET INCOME Margin

(%)

NET INCOME Margin

(%)

FY06

FY07

FY08

FY09

FY10

14. 8

18. 5

20. 7

23. 1

25. 3

Description

(Rpbn)

FY2009

FY2010

Change

(%)

Revenue

14,388

14,344

(0.3)

Cost of revenue

7,614

7,534

(1.0)

Gross profit

6,774

6,810

0.5 Operating expenses

2,432

2,321

(4.5)

Operating income

4,343

4,489

3.4 Ebitda

4,773

4,970

4.1 Net Income

3,326

3,633

9.2 EPS (full amount)

566

613

8.3 4,970

4,773

3,867

2,849

2,234

0

1.000

2.000

3.000

4.000

5.000 2006

2007

2008

2009

2010

3,633

3,326

2,524

1,775

1,296

0

1.000

2.000

3.000

4.000

(19)

18 FINANCIAL SUMMARY: 9M-2011 RESULTS

EBITDA

(Rp billion)

NET INCOME

(Rp billion)

NET INCOME

(Rp billion)

EBITDA Margin

(%)

EBITDA Margin

(%)

9M-07

9M-08

9M-09

9M-10

9M-11

29. 1%

31. 6%

32. 5%

34. 5%

32. 8%

NET INCOME Margin

(%)

NET INCOME Margin

(%)

Description

(Rpbn)

9M-2010

9M-2011

Change

(%)

Revenue

10, 292

11, 611

12. 8

Cost of revenue

5, 356

6, 328

18. 1

Gross profit

4, 936

5, 283

7. 0

Operating expenses

1, 729

1, 881

8. 8

Operating income

3, 207

3, 402

6. 1

Ebitda

3, 546

3, 805

7. 3

Net Income

2, 522

2, 761

9. 5

EPS (full amount)

465

425 9. 4

2.761

1.272

1.791

2.408

2.522

0

500

1.000

1.500

2.000

2.500 9M07

9M08

9M09

9M10

9M11

9M-07

9M-08

9M-09

9M-10

9M-11

17. 9%

20. 3%

23. 1%

24. 5%

23. 8%

3.805

3.546

3.379

2.783

2.063

0

1.000

2.000

3.000

4.000

(20)

STRATEGIC PROJECTS

SMGR Corporat e Present at ion

January 2011

(21)

20 SMGR LONG TERM STRATEGIC FOCUS

SMGR

THE OVERALL

STRATEGY

COMBINES

6 CRITICAL

ELEMENTS

1. Undertake Capacity Growth

2. Manage Energy Security

3. Enhance Company Image

4. Move Closer To The Customer

5. Enable Corporate Growth

(22)

Cement Finish Grinding

Preparation Bored Pile

Coal Storage Steel Structure

Jetty Extension Area

T

u

b

a

n

T

u

b

a

n

T

o

n

a

sa

T

o

n

a

sa

T

o

n

a

sa

T

o

n

a

sa

New Power Plant Area

New Plants

Location

Capacity

(mn tons)

Investment

(US$ mn)

Construction

Start

Completed

Java

2. 5

304 2009

Mar 2012

Sulawesi

2. 5

290 2009

Jun 2012

Sub Total

5. 0

594 Power Plants

Location

Capacity

(MW)

Investment

(US$ mn)

Construction

Start

Completed

Sulawesi

2 x 35

114 2010

Nov 2012

TOTAL CAPEX

US$ 708mn

CEMENT PLANTS & POWER PLANT PROJECTS

These st rat egic proj ect s wil l ensure sust ainabil it y of

t he Company’ s market l eadership

Preheater Tuban IV

(23)

Progress of Tonasa V Cement Plant Project

Progress of Tuban IV Cement Plant Project

Progress of Power Plant Project - Tonasa 2 x 35 M W

PROGRESS OF CEMENT & POWER PLANT PROJECTS – December 31, 2011

22 Description

Weight

Planning

Actual

Preparat ion

0. 39%

100. 00%

Management

2. 88%

100. 00%

98. 19%

Engineering

3. 83%

100. 00%

Procurement

72. 82%

100. 00%

99. 26%

Const ruct ion

18. 03%

100. 00%

78. 86%

Commissioning

2. 05%

100. 00%

5. 05%

Total

100 %

100. 00%

93. 65%

Description

Weight

Planning

Actual

Preparat ion

0. 12%

100. 00%

Management

5. 58%

100. 00%

99. 18%

Engineering

4. 14%

100. 00%

Procurement

69. 41%

100. 00%

99. 83%

Const ruct ion

18. 77%

100. 00%

91. 83%

Commissioning

1. 97%

100. 00%

66. 95%

Total

100 %

100. 00%

97. 65%

Description

Weight

Planning

Actual

Preparat ion

2. 63%

100. 00%

Management

4. 60%

70. 68%

72. 17%

Engineering

5. 75%

99. 77%

98. 62%

Procurement

55. 13%

85. 86%

82. 25%

Const ruct ion

26. 45%

51. 63%

43. 98%

Commissioning

5. 44%

0. 00%

0. 18%

Total

100%

72. 61%

68. 61%

Preheat er Tonasa V

Preheat er Tuban IV

(24)

DESIGN CAPACITY (Mio Ton)

15. 2

16. 7

17. 8

17. 7

19. 6

22. 5

25. 9

27. 3

30. 0

1,8

1,0

0,7

_0,3

0,1

2007

2008

2009

2010

2011

2012F

2013F

2014F

2015F

17. 1

18. 0

19. 0

Export

sales

▪ Domest ic

sales

▪ Export

sales

▪ Domest ic

sales

▪ 20. 2

Based

Capacity

Based

Capacity

Up-grading

New

Capacity

New

Capacity

16. 9

3. 1

10. 0

(25)

CONCLUSION: WHY SMGR?

SMGR Corporat e Present at ion

January 2011

(26)

SMGR’s COMPARATIVE & COMPETITIVE ADVANTAGE HAS DRIVEN SMGR TO BE

THE MARKET LEADER IN INDONESIA

Out st anding performance Experienced

management t eam

Conservat ive capit al st ruct ure

and financial policies

Robust cash flow generat ion

Out st anding business performance

Favorable indust ry

out look



Outstanding business performance

–

Leading cement pl ayer in Indonesia wit h over 41% market share based on

sal es vol ume f or 2010 and approximat el y 37% share of t ot al inst al l ed

cement capacit y (Source: Indonesia Cement Associat ion (“ ASI” ))

–

St rat egical l y l ocat ed pl ant s proximat e t o key market s t hroughout t he

count ry

–

Subst ant ial growt h opport unit ies t hrough expansion and opt imizat ion

–

Superior dist ribut ion net work and st rong brands recognit ion

–

Long-t erm access t o raw mat erial s f or cement product ion and coal f or f uel

consumpt ion

–

Concerns on environment al and Corporat e Social Responsibil it y programs t o

ensure sust ainabl e growt h.



Favourable industry outlook

–

Cement consumpt ion pret t y much in-l ine wit h Indonesian economic growt h

–

Real est at e and inf rast ruct ure proj ect s and decl ining int erest rat es key

demand drivers

–

High barriers t o ent ry (pl ant , dist ribut ion and brand invest ment cost s)

–

Discipl ined invest ment on suppl y side



Robust cash flow generation

–

Hist orical l y st rong revenue, margin and price t rends

–

High pl ant ut il izat ion and st rong f ocus on cost and revenue management



Conservative capital structure and financial policies

–

[ Invest ment grade-l ike credit met rics]

–

Conservat ive capit al st ruct ure pol icy; l ow use of l everage

–

Access t o capit al market s f or expansion init iat ives



Experienced management team

–

Experienced and successf ul management t eam

(27)

26 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:

Gedung The East, 18

_Floor,

Jln. Lingkar Mega Kuningan Kav. E3.2 No. 1,

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)

21 Cement Finish Grinding

Preparation Bored Pile

Coal Storage Steel Structure

Jetty Extension Area

T

u

b

a

n

T

u

b

a

n

T

o

n

a

sa

T

o

n

a

sa

T

o

n

a

sa

T

o

n

a

sa

New Power Plant Area

New Plants

Location

Capacity

(mn tons)

Investment

(US$ mn)

Construction

Start

Completed

Java

2. 5

304 2009

Mar 2012

Sulawesi

2. 5

290 2009

Jun 2012

Sub Total

5. 0

594 Power Plants

Location

Capacity

(MW)

Investment

(US$ mn)

Construction

Start

Completed

Sulawesi

2 x 35

114 2010

Nov 2012

TOTAL CAPEX

US$ 708mn

CEMENT PLANTS & POWER PLANT PROJECTS

These st rat egic proj ect s wil l ensure sust ainabil it y of

t he Company’ s market l eadership

Preheater Tuban IV

(2)

Progress of Tonasa V Cement Plant Project

Progress of Tuban IV Cement Plant Project

Progress of Power Plant Project - Tonasa 2 x 35 M W

PROGRESS OF CEMENT & POWER PLANT PROJECTS – December 31, 2011

Description

Weight

Planning

Actual

Preparat ion

0. 39%

100. 00%

Management

2. 88%

100. 00%

98. 19%

Engineering

3. 83%

100. 00%

Procurement

72. 82%

100. 00%

99. 26%

Const ruct ion

18. 03%

100. 00%

78. 86%

Commissioning

2. 05%

100. 00%

5. 05%

Total

100 %

100. 00%

93. 65%

Description

Weight

Planning

Actual

Preparat ion

0. 12%

100. 00%

Management

5. 58%

100. 00%

99. 18%

Engineering

4. 14%

100. 00%

Procurement

69. 41%

100. 00%

99. 83%

Const ruct ion

18. 77%

100. 00%

91. 83%

Commissioning

1. 97%

100. 00%

66. 95%

Total

100 %

100. 00%

97. 65%

Description

Weight

Planning

Actual

Preparat ion

2. 63%

100. 00%

Management

4. 60%

70. 68%

72. 17%

Engineering

5. 75%

99. 77%

98. 62%

Procurement

55. 13%

85. 86%

82. 25%

Const ruct ion

26. 45%

51. 63%

43. 98%

Commissioning

5. 44%

0. 00%

0. 18%

Total

100%

72. 61%

68. 61%

Preheat er Tonasa V

Preheat er Tuban IV

(3)

DESIGN CAPACITY (Mio Ton)

15. 2

16. 7

17. 8

17. 7

19. 6

22. 5

25. 9

27. 3

30. 0

1,8

1,0

0,7

_0,3

0,1

2007

2008

2009

2010

2011

2012F

2013F

2014F

2015F

17. 1

18. 0

19. 0

Export

sales

▪ Domest ic

sales

▪ Export

sales

▪ Domest ic

sales

▪ 20. 2

Based

Capacity

Based

Capacity

Up-grading

New

Capacity

New

Capacity

16. 9

3. 1

10. 0

(4)

CONCLUSION: WHY SMGR?

SMGR Corporat e Present at ion

(5)

25 SMGR’s COMPARATIVE & COMPETITIVE ADVANTAGE HAS DRIVEN SMGR TO BE

THE MARKET LEADER IN INDONESIA

Out st anding performance Experienced

management t eam

Conservat ive capit al st ruct ure

and financial policies

Robust cash flow generat ion Out st anding

business performance

Favorable indust ry

out look



Outstanding business performance

–

Leading cement pl ayer in Indonesia wit h over 41% market share based on

sal es vol ume f or 2010 and approximat el y 37% share of t ot al inst al l ed

cement capacit y (Source: Indonesia Cement Associat ion (“ ASI” ))

–

St rat egical l y l ocat ed pl ant s proximat e t o key market s t hroughout t he

count ry

–

Subst ant ial growt h opport unit ies t hrough expansion and opt imizat ion

–

Superior dist ribut ion net work and st rong brands recognit ion

–

Long-t erm access t o raw mat erial s f or cement product ion and coal f or f uel

consumpt ion

–

Concerns on environment al and Corporat e Social Responsibil it y programs t o

ensure sust ainabl e growt h.



Favourable industry outlook

–

Cement consumpt ion pret t y much in-l ine wit h Indonesian economic growt h

–

Real est at e and inf rast ruct ure proj ect s and decl ining int erest rat es key

demand drivers

–

High barriers t o ent ry (pl ant , dist ribut ion and brand invest ment cost s)

–

Discipl ined invest ment on suppl y side



Robust cash flow generation

–

Hist orical l y st rong revenue, margin and price t rends

–

High pl ant ut il izat ion and st rong f ocus on cost and revenue management



Conservative capital structure and financial policies

–

[ Invest ment grade-l ike credit met rics]

–

Conservat ive capit al st ruct ure pol icy; l ow use of l everage

–

Access t o capit al market s f or expansion init iat ives



Experienced management team

–

Experienced and successf ul management t eam

(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:

Gedung The East, 18

_Floor,

Jln. Lingkar Mega Kuningan Kav. E3.2 No. 1,

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