Company Presentation 1H 2013
PT Toba Bara Sejahtra Tbk ( Toba )
Company Presentation1
First Half 2013
Disclaimer
These materials have been prepared by PT Toba Bara Sejahtra (the “Company”).
These materials may contain statements that constitute forward-looking statements. These statements
include descriptions regarding the intent, belief or current expectations of the Company or its officers with
respect to the consolidated results of operations and financial condition of the Company. These statements
can be recognized by the use of words such as “expects,” “plan,” “will,” “estimates,” “projects,” “intends,” or
words of similar meaning. Such forward-looking statements are not guarantees of future performance and
involve risks and uncertainties, and actual results may differ from those in the forward-looking statements
as a result of various factors and assumptions. The Company has no obligation and does not undertake to
revise forward-looking statements to reflect future events or circumstances.
These materials are for information purposes only and do not constitute or form part of an offer, solicitation
or invitation of any offer to buy or subscribe for any securities of the Company, in any jurisdiction, nor
should it or any part of it form the basis of, or be relied upon in any connection with, any contract,
commitment or investment decision whatsoever. Any decision to purchase or subscribe for any securities
of the Company should be made after seeking appropriate professional advice.
2
Content
1
Corporate Profile
2
Operational & Marketing Profile
3
Business Overview
4
Operational & Financial Highlights
5
CSR & Environmental Highlights
3
1
Corporate Profile
4
Toba in Brief
Toba specializes in thermal coal production and comprises three operating subsidiaries: Adimitra
Baratama Nusantara (ABN), Indomining (IM) and Trisensa Mineral Utama (TMU), which hold adjacent
concession areas located in East Kalimantan, Indonesia
• Substantial and diversified thermal coal
reserves and resources
o JORC-compliant proved and probable reserves of
147 MM tons and measured, indicated and
inferred resources of 236 MM tons
o Coal brands with calorific values ranging from
4,700 - 5,800 Kcal / kg GAR
• Strong growth profile
o Produced 5.2 MM tons of coal in 2011 and grew to
produce around 5.6 MM tons of coal in 2012
o Prime location provides the operational cost edge to
grow as a logistical & operational center for the area
o Continued exploration effort to increase our Reserves and
Resources. Current reserves only account for 52% of our
total area has been explored
Revenue (1)
EBITDA(1)
Reserves
Resources
%
%
%
%
TMU
4.4%
TMU
4.5%
IM
21.8%
TMU
5.4%
TMU
18.2%
IM
15.0%
IM
19.6%
IM
15.7%
ABN
76.0%
ABN
73.7%
ABN
79.6%
Total: US$ 425 MM
Total: US$ 30 MM
Note: (1) Last Twelve Month analysis ~ Revenue and EBITDA
Total: 147 MM Tonnes
ABN
66.1%
Total: 236 MM Tonnes
5
Ownership Structure
PT Toba Sejahtra ( TS )
Davit Togar Pandjaitan (1)
71.8%
0.8%
PT Bara Makmur Abadi
PT Sinergi Sukses Utama
6.2%
Roby Budi Prakoso
Public
3.6%
5.1%
12.5%
ABN Minorities
49.0%
99.99% (2)
PT Toba Bumi Energi ( TBE )
51.00%
License
Area
• 20-year Production
Operation Mining Permit
( IUPOP ) expiring in
December 2029
• IUPOP was converted from
Kuasa Pertambangan
( KP ) in 2009
• 2,990 ha
Reserve • Reserves: 117MT- JORC
• Resources: 156MT- JORC
Notes:
1. Son of TS founder, Luhut B. Pandjaitan
2. Figures are rounded off
99.99% (2)
• IUPOP expires in June 2013
• IUPOP was converted from KP in
2010
• IUPOP extension was completed
in March 2013 (First out of 2
extensions: in 2023, with tenor of
10 years each)
99.99% (2)
• 13-year IUPOP expires in December
2023
• IUPOP was converted from a KP in
2010
• 683 ha
• 3,414 ha
• Reserve: 22 MT- JORC
• Resources: 37MT- JORC
• Reserves : 8 MT - JORC and
additional 7 MT of internal estimate
• Resources: 43 MT- JORC
90.00%
• Plantation permit expires in 2036
• 8,633 ha (Right to Use Land)
• Planted Area: 2,896 ha
6
Majority Shareholder
Toba believes it benefits from Toba Sejahtra’s experience in the Indonesian coal sector as well as its
leadership and experience
Controlling Shareholder with Established Track Record…
… Helmed by an Experienced Leader
• A privately owned group founded in 2004 with interests in energy
and plantations
• General (Ret.) Luhut B. Pandjaitan is the key shareholder and
founder of Toba Sejahtra group. He is currently the chairman of TS
• Its business segments are as follow:
• Mr. Luhut had a long and illustrious career in the civic service
before turning to the commercial sector. Over the course of thirty
years in the Army Special Forces, Mr. Luhut rose to become a fourstar general
– Energy: Owns 5 coal mining concessions through Toba and PT
Kutai Energi. All of TS' mines are characterized by low production
costs and favorable proximity to ports
– Oil & Gas: In the exploration phase of the 4,567 sq miles South
East Madura Block through subsidiary E&P company PT Energi
Mineral Langgeng
– Power Plant: Operates a 30 MW coal-fired power plant in Palu,
Central Sulawesi and is developing a 120 MW greenfield power
plant in Senipah, East Kalimantan
– Agribusiness: A 25% stake in a 12,000 ha palm oil plantation in
East Kalimantan
– In 1999, Mr. Luhut retired from the military service to serve as
Ambassador for the Republic of Indonesia to Singapore
– In 2000, he was appointed Minister of Industry and Trade of the
Republic of Indonesia
• Thereafter, Mr. Luhut applied his knowledge and leadership skills to
establish TS in 2004, building it from the ground up into a major
business group with interests in energy oil and gas, power and
agribusiness
7
Initial Public Offering
Listed on IDX
Number of Shares Offered
IPO Proceed
Anchor Investor
Ticker Code
06 July 2012
210,681,000 shares or 10.47%
IDR 400,293,900,000
Baring Private Equity Asia (8% at IPO)
TOBA
8
Key Milestones
Strong track record of acquisitions, development of greenfield mines, rapid production ramp-up and
experience to adjust operation in a down-market
2007
2009
2011
2013
• IM commenced
production
• ABN & IM production
reached 2m tons
• TMU commenced
production
• IM successfully
extended IUPOP
until 2023
• Toba production
hit 5m tons
2007
2008
2009
2010
2011
2012
2013
2008
2010
2012
• ABN commenced
production
• TS acquired the remaining share
for IM from minority shareholder
• Toba acquired the minorities’
shares in TBE and TMU
• Operational
adjustment due to
drop in coal
market
• Toba acquired 51.0% of ABN,
52.5% of TBE (IM’s shareholding
company) and 51.0% of TMU
• IPO/Listed on IDX, 6th July
2012
• Toba production hit 4m tons
• Eliminated overlapping issues
with plantation company (PKU)
9
Operational & Marketing Profile
10
Solid Operating Track Record
Toba is transitioning from Greenfield into growing major player
Production Growth
MT = Million Tons
6
~5,8~ –6,5
6,4
ABN
IM
TMU
5,6
5,3
0.0
5
3,9
4
0.3
0.3
1.0
1.4
0.9
3
2,0
2
3.8
0.9
1
0
4.4
Forecast
7
3.1
0,8
0,2
0.7
0.1
1.1
2007
2008
2009
Source: Company data
TMU
2010
Indomining
2011
2012
2013
ABN
• Toba started exploration at ABN & IM in 2006 and at TMU in 2008
• Production grew at 65% CAGR from initial size of 800k in 2008 to 5.6 MT in 2012
• Toba focuses on Continuous Production Growth and this is supported by available infrastructure
capacity of 13 MT of coal
• Additional 3 MT of capacity is expected to be realized in 3-4Q13 to become total of 16 MT
11
• Production growth will be driven by TMU and Additional CAPEX will help it fuel growth
Prime Location Gives Significant Advantage in Cost
Prime Location
0
12
24
36
Major City
Jetty
Transhipment Point
TMU - IM Hauling Road
48
kilometers
4
Major city is
less than 50
km
Muara
Berau
3
Furthest pit to
jetty 25km | with
closest one ~5km
Samarinda
~55 km
(total ~120 km)
Mahakam River
2
IM
ABN
ABN
TMU
~ 5 km
IM Jetty
Close proximity
transhipment
point & jetty
Makassar Strait
ABN Jetty
Kutai Energy 17km
Jetty
1
Adjacent
locations for all
3 mines
~65 km
Muara Jawa
Balikpapan
Toba owns all infrastructures (coal processing plants, overland conveyors, and jetties),
giving significant operating leverage vs other concessions in surrounding areas
12
Substantial Reserves and Resources
Support Production Expansion
Reserves and resources upside from conversion of resources to reserves and further exploration of
concession areas
Reserves (1)
Resources (1)
MM Tons
MM Tons
Coal Reserves and Resources (1) (2) (JORC)
TMU
5.4%
Coal Reserves
Proved
Probable
Total
Reserves
Measured
Indicated
Inferred
Total
Resources
ABN
70
47
117
73
70
13
156
IM
11
10
22
24
10
4
37
TMU
5
4
8
9
8
26
43
Total
86
61
147
106
88
43
236
(MM Tons)
IM
15.0%
TMU
18.2%
IM
15.7%
ABN
66.1%
ABN
79.6%
Total: 147 MM Tons
Coal Resources
Total: 236 MM Tons
Notes:
1. Differences in totals are due to rounding off
2. The Runge Report for ABN was as of 31 December 2011, the PT SMG Consulting Report for IM was as of 1 January 2012 and the Marston Report for TMU
was as of 31 October 2011
13
Strong Relationships with Multinational Customers
Major customers provide the stable
business support for Toba’s marketing…
… minimum marketing fees because Toba
handles our own marketing internally
Major Customers
Toba’s Marketing Operations
Central Marketing Operations of all 3
subsidiaries
Internally developed customer base
that allows Toba to have low marketing
costs
Balance mix of long term contracts,
short term and spot
DRAGON ENERGY GROUP
Active participation in reputable
conference and trade shows to promote
Toba brand
Enhance marketing strategy to sell
directly to end-users
14
3
Business Overview
15
Strategic Initiatives to Manage Changing Environment
Returning future
Profitability
Level
Strategic Initiatives / Response to Changing Coal Prices
1
Manage cash costs: Lower SR,
Shorten Dump Distance
2
3
Construct hauling road from
TMU to IM
Share current infrastructures :
CPP & Jetty & lower costs
4
Centralize fuel supply
5
6
Optimize sales through hedging
activities
Increase our reserves through
acquisition and exploration
16
Milestone 2013
• IM entered into
new Mining
Contract with
RPP for 5 years
Jan’13
• Hauling Road TMU – IM
completed ahead of
schedule
• New CPP at IM
expected to be
completed
• TMU Production ready
for ramp up to 80 - 100 K
tons/month
• IM’s capacity
expected to increase
up to 6 MMTPA
Apr’13
2007
May’13
2008
• TMU set up mine
operations in new
pit (block 4)
Sept’13
………..
2009
2010
Oct’13
2011
2012
• 2nd underpass in
ABN expected to
be completed
• Border-mining at
ABN & IM
commenced
Toba is on track in integrating its operation and infrastructure
capabilities
17
Business Strategies
1
2
3
4
5
Integration of three
(3) mines
Organically increase
coal production levels
Increase coal reserve
and resource
Strengthen existing
and develop new
customer
relationships
Continue to focus on
health and safety,
environmental track
record and
commitment to CSR
• Benchmarking and
sharing between
departments and
functions
• Expand coal production
through increased
production and mine
development activities
• Optimize and
coordinate mine
planning and logistics
• Strengthen
relationships with third
party mining
contractors and work
closely with them to
improve their
productivity
• Continue exploration
activities to increase
proven and probable
reserves as only 52%
has been explored to
JORC standard
• Supply a higher
proportion of sales
volume to end users,
while maintaining
relationships with
existing coal traders
• Consider opportunities
to acquire coal
concessions with
significant reserves
• Target customers in
Japan, Taiwan, South
Korea, China, Vietnam
and Hong Kong, South
East Asia and India
• Centrally coordinate
and streamline
corporate finance,
legal, human resource
and CSR functions
• Maintain and enhance
high international
operating standards,
utilize automated
mining methods to
minimize accidents and
enhance safety
• Foster community ties
through development
programs as well as job
creation
• Joint mine plan and
infrastructure sharing
Growing Reserves and Maintain Profitability at Different Cycles
18
4
Operational & Financial Highlights
19
Toba’s Operational Performance in 2Q 2013
Quarterly Production & Stripping Ratio (SR)
Thousand Tons
Production volume
Stripping Ratio (SR)
2,000
20x
17.6x
16.6x
1,500
15.1x
14.2x
13.6x
15x
12.1x
1,000
10x
1,097
1,373
1,574
1,587
1,287
1,501
1Q 2012
2Q 2012
3Q 2012
4Q 2012
1Q2013
2Q2013
500
5x
• Production volume of 2.8
MMT in 1H 2013 was 44%
of our FY 2013 production
target
• To achieve FY target of
5.8MT-6.4MT,
TMU
is
expected
to
be
instrumental in boosting
overall
growth
via
continued ramp-up
Production Summary
Sales
(Mn tons)
1Q13
2Q13
1.44
1.37
Change
Comment
-4.9%
Sales volume in 1Q13 was slightly higher than in 2Q13
mainly due to inventory clearance accumulated from
4Q12
Q-o-Q production in 2Q13 increased by 16.6%
resulting from completion of pre-stripping at ABN and
TMU
Production
(Mn tons)
1.29
1.50
16.6%
SR (x)
15.1
13.6
-9.9%
SR fell due to completion of pre-stripping at ABN
ABN Operational Performance
Production & Stripping Ratio
Thousand Tons
IM
Production volume (mt)
Stripping ratio
1.500
20x
17,6x
17,1x
16,6x
14,7x
ABN
14,2x
1.000
15x
12,6x
TMU
10x
884
1.078
1.224
1.225
925
995
1Q 2012
2Q 2012
3Q 2012
4Q 2012
1Q2013
2Q 2013
500
5x
Key Highlights
PT Kutai Energi
Despite higher than anticipated rainfall delayed operational activities in 1H13,
ABN still managed to increase production by 7.6% from 1Q13 to 2Q13
ABN’s 2nd underpass is currently under construction and expected to be
completed by 4Q13 with aim to lower OB dump distance
Operational Advantage & Focus
2
1
Short coal hauling
distance 4km
3
High Built Crusher
Cap 10 mm ton/year
Barge Loading Jetty
Loading Speed of up to
1,800 ton/hour
4
Under-pass:
Capitalizing on Infra
Strength
21
IM Operational Performance
Production & Stripping Ratio
Thousand Tons
500
Production volume (mt)
Stripping ratio
12.7x
14,5x
ABN
13,1x
14,6x
9,7x
15x
11,2x
250
TMU
20x
10x
5x
190
236
265
272
278
360
1Q 2012
2Q 2012
3Q 2012
4Q 2012
1Q 2013
2Q 2013
0
PT Kutai Energi
0x
Key Highlights
IM’s production in 2Q13 increased by 30% Q-o-Q, contributed by
higher production volume from border mining
On y-o-y basis, dump distance fell by ~1000m, decreased by 40%
Operational Advantage & Focus
2
1
Short coal
hauling dist. < 5km
4
3
CPP Ramp up to
6MM TPY
Conveyor for TMU
& Others
Cross Border
Mining with ABN
22
TMU Operational Performance
Production & Stripping Ratio
Thousand Tons
IM
Production volume
100
Stripping Ratio
45,6x
ABN
45x
35x
50
0
PT Kutai Energi
25x
17,0x
10,8x
14,4x
11,2x
12,7x
15x
23
59
85
1Q 2012
2Q 2012
3Q 2012
90
4Q 2012
84
1Q 2013
146
5x
2Q 2013
Key Highlights
Note:
---
Hauling road
TMU Coal Production (ktons)
80
70
60
50
40
30
20
10
0
72
50
32
TMU’s production in 2Q13 increased by 74% Q-o-Q, mainly due to strong
contribution from recently-opened Block 4
TMU’s hauling road to IM was completed ahead of schedule in end-May 2013.
To date, IM has been using IM’s CPP and jetty facilities for coal shipment
In June 2013, production reached 72,000 tons/month, rising 125% from 32,000
tons/month in January 2013. This level of productivity is expected to be
maintained for the rest of year
Operational Advantage & Focus
1
2
3
34
22
25
Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13
16-17km Hauling Road
to ABN is completed
Mine operations
commenced
at Block 4
Integrate CPP
Ops with IM
23
Financial Performance YTD 2013
TOBA
Operation
Sales Volume
Coal production
Stripping Ratio
NEWC Index
Per Ton Basis
ASP
FOB Vessel Cash Cost
Adj. FOB Vessel Cash Cost
EBITDA
Financial
Sales
Gross Profit
Operating Profit
EBITDA
Net Income before Minority
Interest
Ratio
Gross Profit Margin
EBITDA Margin
Net Profit Margin
Notes
1Q 2013
2Q 2013
YTD 2013 Change %
1
kton
kton
x
US$/ton
1.435
1.287
15.1
93.0
1.367
1.500
13.6
85.9
2.802
2.787
14.3
89.5
-5%
17%
-10%
-8%
US$/ton
US$/ton
US$/ton
US$/ton
66.4
55.4
59.3
6.6
68.1
54.9
56.0
9.1
67.2
55.2
57.7
7.8
3%
-1%
-6%
39%
US$'000
US$'000
US$'000
US$'000
94,942
14,392
7,745
9,448
93,138
16,692
10,655
12,486
188,079
31,084
18,400
21,934
-2%
16%
38%
32%
US$'000
5,975
6,616
12,591
11%
%
%
%
15.2%
10.0%
6.3%
17.9%
13.4%
7.1%
16.5%
11.7%
6.7%
18%
35%
13%
(a) FOB vessel cash costs: COGS, Selling Expenses, Royalty,excluding depreciation fixed assets and amortization of exploration
and development
(b) Adj. FOB vessel cash costs: COGS, Selling Expenses, Royalty excluding depreciation fixed asset and amortization of
exploration and development asset & without accounting for component of deferred striping cost
2
3
•
In 2Q13, SR was
lowered by 10%, while
production increased
by 17%...
•
…resulting in 6%
decline in adj FOB
Vessel cash cost
•
ASP slightly rose by 3%
despite 8% Q-o-Q fall
in NEWC Index…
•
… EBITDA and Net
Income increased by
32% and 11%
respectively
24
Financial Performance – 1H 2013 vs 1H 2012
1H 2012
Operation
Sales Volume
million ton
Coal Production
million ton
Striping Ratio
x
NEWC Index
US$/ton
Financials
Sales
US$ Million
Gross Profit
US$ Million
Operating Profit
US$ Million
EBITDA
US$ Million
Net Income
US$ Million
Net Income after Minority US$ Million
Interest
Ratio
Gross Profit Margin
%
EBITDA Margin
%
Net Profit Margin
%
Per Ton Basis
ASP
US$/ton
(a)
FOB Vessel Cash Cost US$/ton
1H 2013
Change %
2.45
2.47
17.1
105.3
2.80
2.79
14.3
89.5
14.1
13.0
(16.4)
(15.0)
202.86
35.90
25.11
27.63
18.15
9.73
188.10
31.10
17.82
21.92
12.65
6.61
(7.3%)
(13.4%)
(29.0%)
(20.7%)
(30.3%)
(32.1%)
0.18
0.14
8.95
0.17
0.12
6.73
(6.6%)
(14.4%)
(24.8%)
82.6
67.6
67.2
55.0
(18.6%)
(18.6%)
Coal production grew 13% (yoy)
driven by TMU and border mining
at IM
Toba’s 1H13 production achieved
44% of 2013 highest production
target of 6.4 million tons
FOB vessel cash cost slashed by
18.6% yoy mainly due to lower
SR and shortened dump
distance
EBITDA declined 20.7%
attributable to 18.6% drop in ASP,
but compensated by lower
COGS and increased sales
volume
25
Note (a)
FOB vessel cash costs: COGS, Royalty, Selling Expenses excluding depreciation and
amortization
Balance Sheet
Balance Sheet
US$’000
Dec-12
Mar-13
Jun-13
Movement
(Jun'13 - Dec'12)
Cash and cash equivalents
36,307
60,348
53,289
47%
Fixed Assets
34,053
35,678
41,337
21%
Others
191,166
187,232
199,681
4%
Total Assets
261,526
283,258
294,307
13%
49,033
43,352
55,804
14%
Other Liabilities
101,549
122,991
123,395
22%
Total Liabilities
150,582
166,343
179,199
19%
Shareholders Equity
110,944
116,915
115,108
4%
Debt
Total Net debt/Equity
44%
37%
48%
•
Total Assets as of June 2013 increased
by 13% from December 2012
•
Cash and cash equivalent rose by 47%
compared to December 2012
•
Shareholders Equity surged by 4% from
December 2012 to June 2013, reflecting
positive growth return
NEWC Index Price (US$/tons)
120
115
114
Despite decreasing trend in Coal index price,
we have successfully grown total assets
through stronger equity base
110
105
100
97
95
93
90
90
87
86
85
80
26
1Q 2012
2Q 2012
3Q 2012
4Q 2012
1 Q 2013
2Q 2013
Debt and Cash Position
Net Debt Position
US$ Mn
70
60
60
56
53
49
50
40
44
43
39
34 35
36
35
Cash
Debt
30
20
16
10
0
1Q 2012
Net Debt to
Equity
2%
2Q 2012
34%
3Q 2012
4Q 2012
6%
11%
1Q 2013
Net Cash
2Q 2013
3%
Cash balance rose from US$16.5 mn in 2Q12 to US$53.3mn in 2Q13, causing net debt
position to improve from US$18.5mn in 2Q12 to US$3.0mn in 2Q13
27
5
CSR & Environmental Highlights
28
Toba is Committed to Being a Responsible
Corporate Citizen
• Toba is continuously developing and implementing its corporate social responsibility programs
– Creating educational opportunities for local communities including renovating schools, training teachers,
providing post-graduate educational assistance and creating a literacy program for adults and a scholarship
program for school-aged children
– Providing health services to the local communities
– Helping groups of farmers plant crops of vegetables and bamboo and assisting with land rehabilitation
– Creating local employment opportunities by sourcing some of the Company’s site workforce from the
neighboring areas
Providing Health Services
Creating Educational Opportunities
Helping Farmers Plant Crops
29
Award and Recognition
ABN
East Kalimantan PROPER Green
Mining Award
2011
2007
Ernst and Young
Social
Entrepreneur of
the Year 2011
2012
2008
PT Toba Bara Sejahtra
Ranks as one of Indonesia’s
Top 50 companies
2014
2013
2009
Indomining
East Kalimantan PROPER Blue
Mining Award
2010
!
2
0
Target
1
1
PROPER Gold Mining
Award in ABN & IM
30
Appendix
31
ABN: Coal Concession Overview
Overview
• Area: 2,990 ha
• Location: Sanga-Sanga, Kutai Kartanegara, East Kalimantan
IM
• Type of license: IUPOP
• Expiry date: 1 December 2029
• Commencement of production: September 2008
• 2012 production: 4.4 MM tonnes
ABN
• Mining consultant: PT Runge Indonesia
ABN
Jetty
Operations
TMU
• Current production capacity (31 December 2012):
– Crusher: 10 MM tonnes p.a.
– Conveyor: 10 MM tonnes p.a.
• Produces two varieties of blended thermal coal
– ABN 52: Marketed
CV(1)
of 5,200 kcal / kg GAR
– ABN 55: Marketed CV of 5,500 kcal / kg GAR
– ABN 58 : Marketed CV of 5,800 kcal / kg GAR
• Substantially all of the owners of the land within ABN’s
concession area have been compensated and ABN has been
granted the exclusive right to mine those areas
Marketing
• Historically sold between 50%-100% of its annual production through
long-term (longer than 1 year) with coal trading companies
– The remainder were sold on the spot market
•
Currently, IM sells coal to buyers based on fixed priced contracts up
to one year, backed with pre-determined cash prepayments
32
Note:
1. Calorific value
IM: Coal Concession Overview
Overview
IM
Jetty
• Area: 683 ha
• Location: Sanga-Sanga, Kutai Kartanegara, East Kalimantan
IM
• Type of license: IUPOP
• Expiry date: IUPOP effective until 2023 and can be renewed for
another 10 years
• Production commencement: August 2007
• 2012 production: 1 MM tonnes
ABN
• Mining consultant: PT SMG Consultants
TMU
Operations
• Current production capacity (31 December 2012):
– Crusher: 3.0 MM tonnes p.a.
– Conveyor: 4.5 MM tonnes p.a.
• Produced one variety of blended thermal coal “Indomining”
with marketed CV(1) of 5,700 kcal / kg GAR in 2012
– May produce additional varieties of blended thermal coal in
the future
• Has compensated the majority all of the owners of the land
within its concession area for their land and has been granted
the exclusive right to mine those areas
Marketing
• Historically sold approximately 50% of its annual production through
short-term (one year or shorter) contracts with coal trading companies
– Clients include Glencore, Flame, Peabody, Dragon, Aempire
• The remainder are sold on the spot market
• Currently, IM sells coal to buyers based on fixed priced contracts up to
one year, backed with pre-determined cash prepayments
33
Note:
1. Calorific value
TMU: Coal Concession Overview
Overview
• Area: 3,414 ha
• Location: Loa Janan, Muara Jawa and Sanga-Sanga,
Kutai Kartanegara, East Kalimantan
• Type of license: IUPOP
• Expiry date: 14 December 2023
• Commencement of production: October 2011
• 2012 coal production: ~257,000 tons
IM
Sungai Sangasanga
• Mining consultant: Marston & Marston
ABN
Operations & Marketing
• Current production capacity (31 December 2012):
Completed haul road
to ABN and IM (25 km)
TMU
– Crusher: 1.4 MM tons p.a.
• Produces one variety of blended thermal coal “Trisensa47”, with marketed CV(1) of 4,700 kcal / kg GAR
– May produce additional varieties of blended thermal
coal in the future
Kutai Energi haul
road and jetty
(17 km)
Pulau Seribu
Jetty KE
Sungai Dondang
34
Note:
1. Calorific value
Company Presentation1
First Half 2013
Disclaimer
These materials have been prepared by PT Toba Bara Sejahtra (the “Company”).
These materials may contain statements that constitute forward-looking statements. These statements
include descriptions regarding the intent, belief or current expectations of the Company or its officers with
respect to the consolidated results of operations and financial condition of the Company. These statements
can be recognized by the use of words such as “expects,” “plan,” “will,” “estimates,” “projects,” “intends,” or
words of similar meaning. Such forward-looking statements are not guarantees of future performance and
involve risks and uncertainties, and actual results may differ from those in the forward-looking statements
as a result of various factors and assumptions. The Company has no obligation and does not undertake to
revise forward-looking statements to reflect future events or circumstances.
These materials are for information purposes only and do not constitute or form part of an offer, solicitation
or invitation of any offer to buy or subscribe for any securities of the Company, in any jurisdiction, nor
should it or any part of it form the basis of, or be relied upon in any connection with, any contract,
commitment or investment decision whatsoever. Any decision to purchase or subscribe for any securities
of the Company should be made after seeking appropriate professional advice.
2
Content
1
Corporate Profile
2
Operational & Marketing Profile
3
Business Overview
4
Operational & Financial Highlights
5
CSR & Environmental Highlights
3
1
Corporate Profile
4
Toba in Brief
Toba specializes in thermal coal production and comprises three operating subsidiaries: Adimitra
Baratama Nusantara (ABN), Indomining (IM) and Trisensa Mineral Utama (TMU), which hold adjacent
concession areas located in East Kalimantan, Indonesia
• Substantial and diversified thermal coal
reserves and resources
o JORC-compliant proved and probable reserves of
147 MM tons and measured, indicated and
inferred resources of 236 MM tons
o Coal brands with calorific values ranging from
4,700 - 5,800 Kcal / kg GAR
• Strong growth profile
o Produced 5.2 MM tons of coal in 2011 and grew to
produce around 5.6 MM tons of coal in 2012
o Prime location provides the operational cost edge to
grow as a logistical & operational center for the area
o Continued exploration effort to increase our Reserves and
Resources. Current reserves only account for 52% of our
total area has been explored
Revenue (1)
EBITDA(1)
Reserves
Resources
%
%
%
%
TMU
4.4%
TMU
4.5%
IM
21.8%
TMU
5.4%
TMU
18.2%
IM
15.0%
IM
19.6%
IM
15.7%
ABN
76.0%
ABN
73.7%
ABN
79.6%
Total: US$ 425 MM
Total: US$ 30 MM
Note: (1) Last Twelve Month analysis ~ Revenue and EBITDA
Total: 147 MM Tonnes
ABN
66.1%
Total: 236 MM Tonnes
5
Ownership Structure
PT Toba Sejahtra ( TS )
Davit Togar Pandjaitan (1)
71.8%
0.8%
PT Bara Makmur Abadi
PT Sinergi Sukses Utama
6.2%
Roby Budi Prakoso
Public
3.6%
5.1%
12.5%
ABN Minorities
49.0%
99.99% (2)
PT Toba Bumi Energi ( TBE )
51.00%
License
Area
• 20-year Production
Operation Mining Permit
( IUPOP ) expiring in
December 2029
• IUPOP was converted from
Kuasa Pertambangan
( KP ) in 2009
• 2,990 ha
Reserve • Reserves: 117MT- JORC
• Resources: 156MT- JORC
Notes:
1. Son of TS founder, Luhut B. Pandjaitan
2. Figures are rounded off
99.99% (2)
• IUPOP expires in June 2013
• IUPOP was converted from KP in
2010
• IUPOP extension was completed
in March 2013 (First out of 2
extensions: in 2023, with tenor of
10 years each)
99.99% (2)
• 13-year IUPOP expires in December
2023
• IUPOP was converted from a KP in
2010
• 683 ha
• 3,414 ha
• Reserve: 22 MT- JORC
• Resources: 37MT- JORC
• Reserves : 8 MT - JORC and
additional 7 MT of internal estimate
• Resources: 43 MT- JORC
90.00%
• Plantation permit expires in 2036
• 8,633 ha (Right to Use Land)
• Planted Area: 2,896 ha
6
Majority Shareholder
Toba believes it benefits from Toba Sejahtra’s experience in the Indonesian coal sector as well as its
leadership and experience
Controlling Shareholder with Established Track Record…
… Helmed by an Experienced Leader
• A privately owned group founded in 2004 with interests in energy
and plantations
• General (Ret.) Luhut B. Pandjaitan is the key shareholder and
founder of Toba Sejahtra group. He is currently the chairman of TS
• Its business segments are as follow:
• Mr. Luhut had a long and illustrious career in the civic service
before turning to the commercial sector. Over the course of thirty
years in the Army Special Forces, Mr. Luhut rose to become a fourstar general
– Energy: Owns 5 coal mining concessions through Toba and PT
Kutai Energi. All of TS' mines are characterized by low production
costs and favorable proximity to ports
– Oil & Gas: In the exploration phase of the 4,567 sq miles South
East Madura Block through subsidiary E&P company PT Energi
Mineral Langgeng
– Power Plant: Operates a 30 MW coal-fired power plant in Palu,
Central Sulawesi and is developing a 120 MW greenfield power
plant in Senipah, East Kalimantan
– Agribusiness: A 25% stake in a 12,000 ha palm oil plantation in
East Kalimantan
– In 1999, Mr. Luhut retired from the military service to serve as
Ambassador for the Republic of Indonesia to Singapore
– In 2000, he was appointed Minister of Industry and Trade of the
Republic of Indonesia
• Thereafter, Mr. Luhut applied his knowledge and leadership skills to
establish TS in 2004, building it from the ground up into a major
business group with interests in energy oil and gas, power and
agribusiness
7
Initial Public Offering
Listed on IDX
Number of Shares Offered
IPO Proceed
Anchor Investor
Ticker Code
06 July 2012
210,681,000 shares or 10.47%
IDR 400,293,900,000
Baring Private Equity Asia (8% at IPO)
TOBA
8
Key Milestones
Strong track record of acquisitions, development of greenfield mines, rapid production ramp-up and
experience to adjust operation in a down-market
2007
2009
2011
2013
• IM commenced
production
• ABN & IM production
reached 2m tons
• TMU commenced
production
• IM successfully
extended IUPOP
until 2023
• Toba production
hit 5m tons
2007
2008
2009
2010
2011
2012
2013
2008
2010
2012
• ABN commenced
production
• TS acquired the remaining share
for IM from minority shareholder
• Toba acquired the minorities’
shares in TBE and TMU
• Operational
adjustment due to
drop in coal
market
• Toba acquired 51.0% of ABN,
52.5% of TBE (IM’s shareholding
company) and 51.0% of TMU
• IPO/Listed on IDX, 6th July
2012
• Toba production hit 4m tons
• Eliminated overlapping issues
with plantation company (PKU)
9
Operational & Marketing Profile
10
Solid Operating Track Record
Toba is transitioning from Greenfield into growing major player
Production Growth
MT = Million Tons
6
~5,8~ –6,5
6,4
ABN
IM
TMU
5,6
5,3
0.0
5
3,9
4
0.3
0.3
1.0
1.4
0.9
3
2,0
2
3.8
0.9
1
0
4.4
Forecast
7
3.1
0,8
0,2
0.7
0.1
1.1
2007
2008
2009
Source: Company data
TMU
2010
Indomining
2011
2012
2013
ABN
• Toba started exploration at ABN & IM in 2006 and at TMU in 2008
• Production grew at 65% CAGR from initial size of 800k in 2008 to 5.6 MT in 2012
• Toba focuses on Continuous Production Growth and this is supported by available infrastructure
capacity of 13 MT of coal
• Additional 3 MT of capacity is expected to be realized in 3-4Q13 to become total of 16 MT
11
• Production growth will be driven by TMU and Additional CAPEX will help it fuel growth
Prime Location Gives Significant Advantage in Cost
Prime Location
0
12
24
36
Major City
Jetty
Transhipment Point
TMU - IM Hauling Road
48
kilometers
4
Major city is
less than 50
km
Muara
Berau
3
Furthest pit to
jetty 25km | with
closest one ~5km
Samarinda
~55 km
(total ~120 km)
Mahakam River
2
IM
ABN
ABN
TMU
~ 5 km
IM Jetty
Close proximity
transhipment
point & jetty
Makassar Strait
ABN Jetty
Kutai Energy 17km
Jetty
1
Adjacent
locations for all
3 mines
~65 km
Muara Jawa
Balikpapan
Toba owns all infrastructures (coal processing plants, overland conveyors, and jetties),
giving significant operating leverage vs other concessions in surrounding areas
12
Substantial Reserves and Resources
Support Production Expansion
Reserves and resources upside from conversion of resources to reserves and further exploration of
concession areas
Reserves (1)
Resources (1)
MM Tons
MM Tons
Coal Reserves and Resources (1) (2) (JORC)
TMU
5.4%
Coal Reserves
Proved
Probable
Total
Reserves
Measured
Indicated
Inferred
Total
Resources
ABN
70
47
117
73
70
13
156
IM
11
10
22
24
10
4
37
TMU
5
4
8
9
8
26
43
Total
86
61
147
106
88
43
236
(MM Tons)
IM
15.0%
TMU
18.2%
IM
15.7%
ABN
66.1%
ABN
79.6%
Total: 147 MM Tons
Coal Resources
Total: 236 MM Tons
Notes:
1. Differences in totals are due to rounding off
2. The Runge Report for ABN was as of 31 December 2011, the PT SMG Consulting Report for IM was as of 1 January 2012 and the Marston Report for TMU
was as of 31 October 2011
13
Strong Relationships with Multinational Customers
Major customers provide the stable
business support for Toba’s marketing…
… minimum marketing fees because Toba
handles our own marketing internally
Major Customers
Toba’s Marketing Operations
Central Marketing Operations of all 3
subsidiaries
Internally developed customer base
that allows Toba to have low marketing
costs
Balance mix of long term contracts,
short term and spot
DRAGON ENERGY GROUP
Active participation in reputable
conference and trade shows to promote
Toba brand
Enhance marketing strategy to sell
directly to end-users
14
3
Business Overview
15
Strategic Initiatives to Manage Changing Environment
Returning future
Profitability
Level
Strategic Initiatives / Response to Changing Coal Prices
1
Manage cash costs: Lower SR,
Shorten Dump Distance
2
3
Construct hauling road from
TMU to IM
Share current infrastructures :
CPP & Jetty & lower costs
4
Centralize fuel supply
5
6
Optimize sales through hedging
activities
Increase our reserves through
acquisition and exploration
16
Milestone 2013
• IM entered into
new Mining
Contract with
RPP for 5 years
Jan’13
• Hauling Road TMU – IM
completed ahead of
schedule
• New CPP at IM
expected to be
completed
• TMU Production ready
for ramp up to 80 - 100 K
tons/month
• IM’s capacity
expected to increase
up to 6 MMTPA
Apr’13
2007
May’13
2008
• TMU set up mine
operations in new
pit (block 4)
Sept’13
………..
2009
2010
Oct’13
2011
2012
• 2nd underpass in
ABN expected to
be completed
• Border-mining at
ABN & IM
commenced
Toba is on track in integrating its operation and infrastructure
capabilities
17
Business Strategies
1
2
3
4
5
Integration of three
(3) mines
Organically increase
coal production levels
Increase coal reserve
and resource
Strengthen existing
and develop new
customer
relationships
Continue to focus on
health and safety,
environmental track
record and
commitment to CSR
• Benchmarking and
sharing between
departments and
functions
• Expand coal production
through increased
production and mine
development activities
• Optimize and
coordinate mine
planning and logistics
• Strengthen
relationships with third
party mining
contractors and work
closely with them to
improve their
productivity
• Continue exploration
activities to increase
proven and probable
reserves as only 52%
has been explored to
JORC standard
• Supply a higher
proportion of sales
volume to end users,
while maintaining
relationships with
existing coal traders
• Consider opportunities
to acquire coal
concessions with
significant reserves
• Target customers in
Japan, Taiwan, South
Korea, China, Vietnam
and Hong Kong, South
East Asia and India
• Centrally coordinate
and streamline
corporate finance,
legal, human resource
and CSR functions
• Maintain and enhance
high international
operating standards,
utilize automated
mining methods to
minimize accidents and
enhance safety
• Foster community ties
through development
programs as well as job
creation
• Joint mine plan and
infrastructure sharing
Growing Reserves and Maintain Profitability at Different Cycles
18
4
Operational & Financial Highlights
19
Toba’s Operational Performance in 2Q 2013
Quarterly Production & Stripping Ratio (SR)
Thousand Tons
Production volume
Stripping Ratio (SR)
2,000
20x
17.6x
16.6x
1,500
15.1x
14.2x
13.6x
15x
12.1x
1,000
10x
1,097
1,373
1,574
1,587
1,287
1,501
1Q 2012
2Q 2012
3Q 2012
4Q 2012
1Q2013
2Q2013
500
5x
• Production volume of 2.8
MMT in 1H 2013 was 44%
of our FY 2013 production
target
• To achieve FY target of
5.8MT-6.4MT,
TMU
is
expected
to
be
instrumental in boosting
overall
growth
via
continued ramp-up
Production Summary
Sales
(Mn tons)
1Q13
2Q13
1.44
1.37
Change
Comment
-4.9%
Sales volume in 1Q13 was slightly higher than in 2Q13
mainly due to inventory clearance accumulated from
4Q12
Q-o-Q production in 2Q13 increased by 16.6%
resulting from completion of pre-stripping at ABN and
TMU
Production
(Mn tons)
1.29
1.50
16.6%
SR (x)
15.1
13.6
-9.9%
SR fell due to completion of pre-stripping at ABN
ABN Operational Performance
Production & Stripping Ratio
Thousand Tons
IM
Production volume (mt)
Stripping ratio
1.500
20x
17,6x
17,1x
16,6x
14,7x
ABN
14,2x
1.000
15x
12,6x
TMU
10x
884
1.078
1.224
1.225
925
995
1Q 2012
2Q 2012
3Q 2012
4Q 2012
1Q2013
2Q 2013
500
5x
Key Highlights
PT Kutai Energi
Despite higher than anticipated rainfall delayed operational activities in 1H13,
ABN still managed to increase production by 7.6% from 1Q13 to 2Q13
ABN’s 2nd underpass is currently under construction and expected to be
completed by 4Q13 with aim to lower OB dump distance
Operational Advantage & Focus
2
1
Short coal hauling
distance 4km
3
High Built Crusher
Cap 10 mm ton/year
Barge Loading Jetty
Loading Speed of up to
1,800 ton/hour
4
Under-pass:
Capitalizing on Infra
Strength
21
IM Operational Performance
Production & Stripping Ratio
Thousand Tons
500
Production volume (mt)
Stripping ratio
12.7x
14,5x
ABN
13,1x
14,6x
9,7x
15x
11,2x
250
TMU
20x
10x
5x
190
236
265
272
278
360
1Q 2012
2Q 2012
3Q 2012
4Q 2012
1Q 2013
2Q 2013
0
PT Kutai Energi
0x
Key Highlights
IM’s production in 2Q13 increased by 30% Q-o-Q, contributed by
higher production volume from border mining
On y-o-y basis, dump distance fell by ~1000m, decreased by 40%
Operational Advantage & Focus
2
1
Short coal
hauling dist. < 5km
4
3
CPP Ramp up to
6MM TPY
Conveyor for TMU
& Others
Cross Border
Mining with ABN
22
TMU Operational Performance
Production & Stripping Ratio
Thousand Tons
IM
Production volume
100
Stripping Ratio
45,6x
ABN
45x
35x
50
0
PT Kutai Energi
25x
17,0x
10,8x
14,4x
11,2x
12,7x
15x
23
59
85
1Q 2012
2Q 2012
3Q 2012
90
4Q 2012
84
1Q 2013
146
5x
2Q 2013
Key Highlights
Note:
---
Hauling road
TMU Coal Production (ktons)
80
70
60
50
40
30
20
10
0
72
50
32
TMU’s production in 2Q13 increased by 74% Q-o-Q, mainly due to strong
contribution from recently-opened Block 4
TMU’s hauling road to IM was completed ahead of schedule in end-May 2013.
To date, IM has been using IM’s CPP and jetty facilities for coal shipment
In June 2013, production reached 72,000 tons/month, rising 125% from 32,000
tons/month in January 2013. This level of productivity is expected to be
maintained for the rest of year
Operational Advantage & Focus
1
2
3
34
22
25
Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13
16-17km Hauling Road
to ABN is completed
Mine operations
commenced
at Block 4
Integrate CPP
Ops with IM
23
Financial Performance YTD 2013
TOBA
Operation
Sales Volume
Coal production
Stripping Ratio
NEWC Index
Per Ton Basis
ASP
FOB Vessel Cash Cost
Adj. FOB Vessel Cash Cost
EBITDA
Financial
Sales
Gross Profit
Operating Profit
EBITDA
Net Income before Minority
Interest
Ratio
Gross Profit Margin
EBITDA Margin
Net Profit Margin
Notes
1Q 2013
2Q 2013
YTD 2013 Change %
1
kton
kton
x
US$/ton
1.435
1.287
15.1
93.0
1.367
1.500
13.6
85.9
2.802
2.787
14.3
89.5
-5%
17%
-10%
-8%
US$/ton
US$/ton
US$/ton
US$/ton
66.4
55.4
59.3
6.6
68.1
54.9
56.0
9.1
67.2
55.2
57.7
7.8
3%
-1%
-6%
39%
US$'000
US$'000
US$'000
US$'000
94,942
14,392
7,745
9,448
93,138
16,692
10,655
12,486
188,079
31,084
18,400
21,934
-2%
16%
38%
32%
US$'000
5,975
6,616
12,591
11%
%
%
%
15.2%
10.0%
6.3%
17.9%
13.4%
7.1%
16.5%
11.7%
6.7%
18%
35%
13%
(a) FOB vessel cash costs: COGS, Selling Expenses, Royalty,excluding depreciation fixed assets and amortization of exploration
and development
(b) Adj. FOB vessel cash costs: COGS, Selling Expenses, Royalty excluding depreciation fixed asset and amortization of
exploration and development asset & without accounting for component of deferred striping cost
2
3
•
In 2Q13, SR was
lowered by 10%, while
production increased
by 17%...
•
…resulting in 6%
decline in adj FOB
Vessel cash cost
•
ASP slightly rose by 3%
despite 8% Q-o-Q fall
in NEWC Index…
•
… EBITDA and Net
Income increased by
32% and 11%
respectively
24
Financial Performance – 1H 2013 vs 1H 2012
1H 2012
Operation
Sales Volume
million ton
Coal Production
million ton
Striping Ratio
x
NEWC Index
US$/ton
Financials
Sales
US$ Million
Gross Profit
US$ Million
Operating Profit
US$ Million
EBITDA
US$ Million
Net Income
US$ Million
Net Income after Minority US$ Million
Interest
Ratio
Gross Profit Margin
%
EBITDA Margin
%
Net Profit Margin
%
Per Ton Basis
ASP
US$/ton
(a)
FOB Vessel Cash Cost US$/ton
1H 2013
Change %
2.45
2.47
17.1
105.3
2.80
2.79
14.3
89.5
14.1
13.0
(16.4)
(15.0)
202.86
35.90
25.11
27.63
18.15
9.73
188.10
31.10
17.82
21.92
12.65
6.61
(7.3%)
(13.4%)
(29.0%)
(20.7%)
(30.3%)
(32.1%)
0.18
0.14
8.95
0.17
0.12
6.73
(6.6%)
(14.4%)
(24.8%)
82.6
67.6
67.2
55.0
(18.6%)
(18.6%)
Coal production grew 13% (yoy)
driven by TMU and border mining
at IM
Toba’s 1H13 production achieved
44% of 2013 highest production
target of 6.4 million tons
FOB vessel cash cost slashed by
18.6% yoy mainly due to lower
SR and shortened dump
distance
EBITDA declined 20.7%
attributable to 18.6% drop in ASP,
but compensated by lower
COGS and increased sales
volume
25
Note (a)
FOB vessel cash costs: COGS, Royalty, Selling Expenses excluding depreciation and
amortization
Balance Sheet
Balance Sheet
US$’000
Dec-12
Mar-13
Jun-13
Movement
(Jun'13 - Dec'12)
Cash and cash equivalents
36,307
60,348
53,289
47%
Fixed Assets
34,053
35,678
41,337
21%
Others
191,166
187,232
199,681
4%
Total Assets
261,526
283,258
294,307
13%
49,033
43,352
55,804
14%
Other Liabilities
101,549
122,991
123,395
22%
Total Liabilities
150,582
166,343
179,199
19%
Shareholders Equity
110,944
116,915
115,108
4%
Debt
Total Net debt/Equity
44%
37%
48%
•
Total Assets as of June 2013 increased
by 13% from December 2012
•
Cash and cash equivalent rose by 47%
compared to December 2012
•
Shareholders Equity surged by 4% from
December 2012 to June 2013, reflecting
positive growth return
NEWC Index Price (US$/tons)
120
115
114
Despite decreasing trend in Coal index price,
we have successfully grown total assets
through stronger equity base
110
105
100
97
95
93
90
90
87
86
85
80
26
1Q 2012
2Q 2012
3Q 2012
4Q 2012
1 Q 2013
2Q 2013
Debt and Cash Position
Net Debt Position
US$ Mn
70
60
60
56
53
49
50
40
44
43
39
34 35
36
35
Cash
Debt
30
20
16
10
0
1Q 2012
Net Debt to
Equity
2%
2Q 2012
34%
3Q 2012
4Q 2012
6%
11%
1Q 2013
Net Cash
2Q 2013
3%
Cash balance rose from US$16.5 mn in 2Q12 to US$53.3mn in 2Q13, causing net debt
position to improve from US$18.5mn in 2Q12 to US$3.0mn in 2Q13
27
5
CSR & Environmental Highlights
28
Toba is Committed to Being a Responsible
Corporate Citizen
• Toba is continuously developing and implementing its corporate social responsibility programs
– Creating educational opportunities for local communities including renovating schools, training teachers,
providing post-graduate educational assistance and creating a literacy program for adults and a scholarship
program for school-aged children
– Providing health services to the local communities
– Helping groups of farmers plant crops of vegetables and bamboo and assisting with land rehabilitation
– Creating local employment opportunities by sourcing some of the Company’s site workforce from the
neighboring areas
Providing Health Services
Creating Educational Opportunities
Helping Farmers Plant Crops
29
Award and Recognition
ABN
East Kalimantan PROPER Green
Mining Award
2011
2007
Ernst and Young
Social
Entrepreneur of
the Year 2011
2012
2008
PT Toba Bara Sejahtra
Ranks as one of Indonesia’s
Top 50 companies
2014
2013
2009
Indomining
East Kalimantan PROPER Blue
Mining Award
2010
!
2
0
Target
1
1
PROPER Gold Mining
Award in ABN & IM
30
Appendix
31
ABN: Coal Concession Overview
Overview
• Area: 2,990 ha
• Location: Sanga-Sanga, Kutai Kartanegara, East Kalimantan
IM
• Type of license: IUPOP
• Expiry date: 1 December 2029
• Commencement of production: September 2008
• 2012 production: 4.4 MM tonnes
ABN
• Mining consultant: PT Runge Indonesia
ABN
Jetty
Operations
TMU
• Current production capacity (31 December 2012):
– Crusher: 10 MM tonnes p.a.
– Conveyor: 10 MM tonnes p.a.
• Produces two varieties of blended thermal coal
– ABN 52: Marketed
CV(1)
of 5,200 kcal / kg GAR
– ABN 55: Marketed CV of 5,500 kcal / kg GAR
– ABN 58 : Marketed CV of 5,800 kcal / kg GAR
• Substantially all of the owners of the land within ABN’s
concession area have been compensated and ABN has been
granted the exclusive right to mine those areas
Marketing
• Historically sold between 50%-100% of its annual production through
long-term (longer than 1 year) with coal trading companies
– The remainder were sold on the spot market
•
Currently, IM sells coal to buyers based on fixed priced contracts up
to one year, backed with pre-determined cash prepayments
32
Note:
1. Calorific value
IM: Coal Concession Overview
Overview
IM
Jetty
• Area: 683 ha
• Location: Sanga-Sanga, Kutai Kartanegara, East Kalimantan
IM
• Type of license: IUPOP
• Expiry date: IUPOP effective until 2023 and can be renewed for
another 10 years
• Production commencement: August 2007
• 2012 production: 1 MM tonnes
ABN
• Mining consultant: PT SMG Consultants
TMU
Operations
• Current production capacity (31 December 2012):
– Crusher: 3.0 MM tonnes p.a.
– Conveyor: 4.5 MM tonnes p.a.
• Produced one variety of blended thermal coal “Indomining”
with marketed CV(1) of 5,700 kcal / kg GAR in 2012
– May produce additional varieties of blended thermal coal in
the future
• Has compensated the majority all of the owners of the land
within its concession area for their land and has been granted
the exclusive right to mine those areas
Marketing
• Historically sold approximately 50% of its annual production through
short-term (one year or shorter) contracts with coal trading companies
– Clients include Glencore, Flame, Peabody, Dragon, Aempire
• The remainder are sold on the spot market
• Currently, IM sells coal to buyers based on fixed priced contracts up to
one year, backed with pre-determined cash prepayments
33
Note:
1. Calorific value
TMU: Coal Concession Overview
Overview
• Area: 3,414 ha
• Location: Loa Janan, Muara Jawa and Sanga-Sanga,
Kutai Kartanegara, East Kalimantan
• Type of license: IUPOP
• Expiry date: 14 December 2023
• Commencement of production: October 2011
• 2012 coal production: ~257,000 tons
IM
Sungai Sangasanga
• Mining consultant: Marston & Marston
ABN
Operations & Marketing
• Current production capacity (31 December 2012):
Completed haul road
to ABN and IM (25 km)
TMU
– Crusher: 1.4 MM tons p.a.
• Produces one variety of blended thermal coal “Trisensa47”, with marketed CV(1) of 4,700 kcal / kg GAR
– May produce additional varieties of blended thermal
coal in the future
Kutai Energi haul
road and jetty
(17 km)
Pulau Seribu
Jetty KE
Sungai Dondang
34
Note:
1. Calorific value