SMGR CORP Presentation June 2014
Together We Build a Better Future
0
INDONESIA’S CEMENT INDUSTRY: NOW and THE FUTURE
SMGR Corporate Presentation
JUNE 2014
CEMENT INDUSTRY AT A GLANCE
2
Kuala
Lumpur
Singapore
1
SMGR
3
4
CEMENT INDUSTRY
• Design Capacity
• Production Capacity
• Domestic Growth
• Domestic Utilization
•Supply
Domestic
Export
Import
:
:
:
:
1
1
6
7
5
2013
68.0 mio tons
55.2 mio tons
5.5%
100%
: 58.0 mio tons
: 0.5 mio tons
: 3.3 mio tons2)
2014F 1)
2015F 1)
71.5 mio tons
60.0 mio tons
6.0%
100%
82.2 mio tons
69.8 mio tons
6.0%
94%
61.0 mio tons
0.5 mio tons
3.0 mio tons 3))
65.8 mio tons
0.5 mio tons
3.0 mio tons3)
1) Based on the Company’s forecast
2) Imported cement by PT Semen Andalas (1.0 mio ton) and clinker by Bosawa and Kupang
3) Imported cement & clinker
DOMESTIC CAPACITY (2014)
1. SEMEN INDONESIA
- Semen Padang :
- Semen Gresik :
- Semen Tonasa:
2. Semen Andalas 2)
3. Semen Baturaja
4. Indocement TP
5. Holcim Indonesia
6. Semen Bosowa
7. Semen Kupang
TOTAL
29.5 mn ton
7.3 mn ton
14.4 mn ton
7.8 mn ton
1.6 mn ton
1.3 mn ton
20.5 mn ton
12.1 mn ton
6.0 mn ton
0.5 mn ton
2
71.5 mn ton
COMPARISON: CEMENT CONSUMPTION PER CAPITA 2013
201
kg/capita
kg
1.800
1.600
1.400
1.200
1.000
800
600
400
229
200
0
a
di
In
p
ili
Ph
a
s
ne
pi
si
ne
do
In
nd
la
ai
Th
re
a
si
ay
al
po
m
na
et
Vi
M
a
ng
Si
a
in
Ch
Source: Deutsche, Indonesia Cement Association
INDONESIA’S ECONOMY AND DOMESTIC CEMENT CONSUMPTION GROWTH
(mio tons)
60.0
20.0%
Cement growth % (RHS)
17.7%
GDP growth % (RHS)
Domestic consumption (LHS)
58.0
54.9
50.0
14.5%
48.0
11.5%
40.0
38.1
9.7%
30.0
27.2
20.0
10.0
27.5
5.8%
4.4%
30.2
5.6%
5.1%
Growth
4.7%:
5.8%
31.5
Growth
:
4.2%
2002
2003
5.4%
10.0%
6.10%
6.3%
9.7%
4.60%
6.1%
Growth
:
4.2%
1.8%
2004
2005
Source: Indonesian Cement Association & BPS Statistic
2006
39.1
34.2
Growth6.6%
:
1.1%
1.1%
0.0
32.1
40.8
2.5%
6.00%
23.7
6.50%
Growth
6.0%
:
6.80%
Growth
:
1.8%
6.6%
5.5%
Growth
5.70%
:
3.7%
19.4%
0.0%
2007
2008
2009
2010
2011
2012
2013
5M2014
ARISING INFRASTRUCTURE EXPANSION TREND
Bag and Bulk cement consumption (million tons)
44.1 45.7
45
40
39.2
35
32.2
30
25
22.7
21.0
20
23.7 23.7
25.2 25.5
26.9
32.8
34.2
28.2
20.0
18.1
18.7
16.9
15
10
6.5
5
1.0
1.9
2.3
3.0
3.5
3.8
5.0
6.0
5.1
6.0
5.9
6.2
6.6
8.8
10.8 12.2
5
0
1997
1999
2001
2003
2005
Bagged Cement
2007
Bulk Cement
2009
2011
2013
DOMESTIC MARKET CONSUMPTION (2013)
Bulk
± 21%
Bag
± 79%
•
Ready
Ready-mix
(infrastructure): ± 60%
•
Fabricator (pre-cast,
(pre
fiber cement, cement based industry): ± 35%
•
Projects (mortar, render): ± 5%
•
Housing: ± 90%
•
Cement based industry: ± 10%
Key Drivers of Domestic cement demand:
Source: Internal Research
Retail (residential) sector is the largest
consumer of cement in Indonesia
• National Economic Growth
• Favorable Interest Rate Environment
• Infrastructure Expansion
• Per Capita Consumption increase from
current low levels
DOMESTIC MARKET UPDATE
SMGR Corporate Presentation
JUNE 2014
MARKET BY GEOGRAPHY
Population Distribution (2013)
Cement Distribution (5M2014)
2
4
3
SP
1
SG
7.4%
7.9%
6
ST
5
5.5%
2.3%
Papua
Bali & N T
21.0%
%
Kalimantan
Java
55.9%
Domestic Market Share (5M2014
5M2014)
REGION
MARKET SHARE (%)
SMGR
INTP
SMCB
1. JAVA
41.2
38.2
17.9
2.4
-
2. SUMATERA
42.9
15.2
14.4
3.3
15.6
3. KALIMANTAN
49.3
30.8
11.3
8.6
4. SULAWESI
61.5
15.4
0.9
5. NUSA TENGGR.
40.9
33.9
6. EASTERN IND.
54.2
TOTAL
INDONESIA
44.0
BSWA ANDLS BTRJA
KPG
-
0.2
8.6
-
-
-
-
22.1
-
-
-
4.3
16,0
-
-
4.8
21.1
0.7
23.8
-
-
30.5
14.
14.2
5.7
3.2
1.8
5.5%
1.5%
5.8%
Sulawesi
Sumatera
8.4%
0.4
Sumatera
21.3%
Java
57.5.%
MARKET UPDATE - Cement Consumption 5M2014
5M 2014 - SMGR Sales Volume (million tons)
DESCRIPTION
5M 2014 – Domestic Consumption (mio tons)
5M-14
5M-13
10,467,232
10,017,522
4.5
Semen Indonesia
5,648,678
5,190,159
8.8
Semen Padang
2,723,628
2,796,549
(2.6)
Semen Tonasa
2,094,926
2,030,813
3.2
22,155
89,907
(75.4)
10,489,387
10,107,429
3.8
DOMESTIC
EXPORT
GRAND TOTAL
CHANGE (%)
SMGR Sales Type (mio tons)
5M-14
5M-13
YoY Change
Bag
7.9 (76.4%)
7.7 (77.6%)
2.8%
Bulk
2.4 (23.6%)
2.2 (22.4%)
10.0%
Industry Sales Type (mio tons)
AREA
5M 2014
5M 2013
CHANGE (%)
Jakarta
2,369,820
2,177,464
8.8
Banten
1,276,761
1,382,750
(7.7)
West Java
3,575,296
3,288,320
8.7
Central Java
2,544,369
2,578,205
(1.3)
389,026
368,214
5.7
3,132,778
2,869,734
9.2
13,288,051
12,664,688
4.9
Sumatera
4,989,864
4,932,070
1.2
Kalimantan
1,882,895
1,803,045
4.4
Sulawesi
1,763,360
1,622,599
8.7
Nusa Tenggara
1,317,726
1,355,331
(2.8)
542,968
556,752
(2.5)
23,784,864
22,934,485
3.7
32,155
85,240
(62.3)
-
21,467
(100.0)
32,155
106,707
(69.9)
23,817,019
23,041,192
3.4
Yogyakarta
East Java
Total Java
Maluku & Papua
TOTAL
INDONESIA
Export Cement
5M-14
5M-13
YoY Change
Bag
18.7 (78.9%)
18.2 (79.5%)
2.9%
Bulk
5.0 (21.1%)
4.7 (20.5%)
6.6%
*) Source: Indonesia Cement Association, un-audited figures
Export Clinker
Total Export
GRAND TOTAL
COMPANY PROFILE
SMGR Corporate Presentation
JUNE 2014
SMGR IS THE #1 CEMENT COMPANY IN INDONESIA
BRIEF HISTORY
1957 : Inauguration of Gresik I, installed capacity of 250,000 ton cement per annum
1991 : Initial Public Offering, Market Cap.: IDR0.63tn, resulting shareholding structure post IPO:
1995
1998
2006
2010
2011
2012
● Government of Republic of Indonesia: 73%
● Public: 27%
: Acquisition of PT Semen Padang (Persero)) and PT Semen Tonasa (Persero)
: Cemex became a strategic partner, Market Cap.: IDR4.9tn
: Blue Valley Holdings bought Cemex’s 24.9% stake in SMGR, Market Cap.: IDR21.5tn
: In March 31, Blue Valley Holdings sold all of its stake ownership in SMGR, Market Cap per April 30, 2010: IDR72.1tn
0mm tons, Market Cap per June 29, 2012: IDR67.0tn
: Total installed capacity of 20.00mm
: Acquisition of Thang Long Cement Vietnam, Total
otal installed capacity of 2.3mm tons, Market Cap Dec 19th, 2012: IDR91.9tn
SMGR CAPACITY BUILD-OUT (Mio TONS)
30,0
consolidated capacity
Post-consolidated
25,0
• Total Installed capacity: 30 million
tons (2013) including TLCC;
20,0
• Market share of Semen Indonesia in
2013 was 44% based on sales volume
15,0
10,0
5,0
• 2013 Revenues amounted to IDR 19.6
trillion (equivalent to EUR 1.2 billion),
with EBITDA margin of 35%
Pre-consolidated capacity
_
_
_
_
_
_
19 70
19 80
19 8
19 4
8
19 5
86
19 90
19 9
19 5
9
19 7
98
20 0
20 6
0
20 7
0
20 8
0
20 9
1
20 0
1
20 1
1
20 2
13
19
57
0,0
FOCUS IN CORE BUSINESS
OWNERSHIP STRUCTURE1
The Government of the Republic of Indonesia
Public
51.01%
48.99%
PT Semen Indonesia (Persero)
(
Tbk.
99.99%
PT Semen Padang
99.99%
99.23%
PT Semen Tonasa
PT Semen Gresik
Name
Activities
% Ownership
1. Igasar
Cement distribution & Trading
12.00%
2. Sepatim B
General trading, cement packaging 85.00%
3. Bima SA
General trading, cement packaging 80.00%
4. SUPS
Cement Packaging
10.00%
Thang Long Cement, VN
Name
Name
Activities
Activities
% Ownership
% Ownership
1. UTSG
UTSG
1.
Limestone
& Clay
Mining
Limestone
& Clay
Mining
55.00%
55.00%
2. IKSG
IKSG
2.
Packaging
Paper
Cement
Packaging
60.00%
60.00%
3. KIG
KIG
3.
Industrial
Estate
65.00%
Industrial
Estate
4. Swadaya Graha65.00%
Contractor & Machine Fabricator 25.00%
Swadaya
Gra
Steel
fabrication,
4.
5. Varia Usaha
Transport
and contractor
general trading 25.00%
24.90%
Usaha
and
general trading
24.90%
5.
6. Varia
Eternit
Gresik Transport
Building
materials
17.60%
6.
7.
7.
8.
Eternit
Gresik
Building
SGG Energy
Prima
Coal materials
Mining and Trading
SGG
Trading
Coal
SGG Prima
Prima Coal
Beton
Ready
Mix Concrete
8. SGG Prima Beton Ready Mix Concrete
¹ As of Jan, 2014
70.00%
17.60%
97.00%
99.99%
99.99%
99.99%
REGIONAL CEMENT PLAYERS
SMGR Corporate Presentation
JUNE 2014
COMPETITIVENESS OF SEMEN INDONESIA
Kiln
1 unit
Cement
Mill
1 unit
Integrated Cement Plant
Kiln
13 Unit
Cement Mill
22 Unit
Grinding Plant
Grinding
Plant
Kiln
4 unit
Cement
Mill
6 unit
Kiln
4 unit
Cement
Mill
9 unit
Cement Mill
1 unit Cement
Mill
Grinding
Plant
3 unit Cement
Mill
4 location
2 location
4 Unit
Warehouse
30 location
Packing Plant
22 location
Sea Port
11 location
Kiln
4 unit
Cement
Mill
6 unit
STRATEGIC
TRATEGIC POSITION IN THE REGION
Kiln
1 unit
Cement
Mill
1 unit
Grinding
Plant
1 unit Cement
Mill
NEW TARGET
Kiln
4 unit
Cement
Mill
6 unit
Kiln
4 unit
Cement
Mill
9 unit
Grinding
Plant
3 unit Cement
Mill
Kiln
4 unit
Cement
Mill
6 unit
SUPPLY-DEMAND
DEMAND CEMENT IN SOUTH EAST ASIA
Potential Market
Cap. : 1.5 mio
Cap. : 54.4 mio
Cap. : 5.6 mio
Export :
Clinker : 6.17
Cement: 5.77
Cap. : 75 mio
Cap. : 22 mio
Cap. : 1.0 mio
Cap. : 0.55 mio
Cap. : - mio
Cap. : 66.4 mio
Cap. : 28.9 mio
Source : Global cement
MAJOR PLAYERS IN SOUTH EAST ASIA
Cement Plant Capacity of Major Player in
South East Asia
Cement Plant Capacity of Major Player in
South East Asia after LafargeHolcim Merger
25
35
30
20
25
20
No of Plant
No of Plant
15
Holcim
Heidelberger
Semen Indonesia
10
5
SCG
0
10
0
Italcementi
-10
10
20
30
40
50
Vicem
SCG
Cemex Italcementi
0
-5
Semen Indonesia
Heidelberger
5
0
-10
15
Lafarge
VIcem
Cemex
LafargeHolcim
10
20
30
40
50
60
70
Cement Plant Capacity (Milion Ton)
Cement Plant Capacity (Milion Ton)
•Setelah
Setelah merger Holcim dan Lafarge, total kapasitas perusahaan menjadi 63 Juta Ton atau 2
kali lipat kapasitas Semen Indonesia dan memiliki Kapasitas yang dapat memenuhi 34%
konsumsi semen di Asia Tenggara
• LafargeHolcim dan Semen Indonesia merupakan Perusahaan Semen yang terkemuka di Asia
Tenggara
80
CEMENT PLAYERS IN SOUTH EAST ASIA
Company
Heidelberg
Indonesia
Malaysia
Philip.
Thailand
1.2
1,6
Lafarge
Cambodia
12.5
9.1
0.5
6,5
Siam Cement
0.5
29.5
2.3
23.5
31.8
7
7
Sources : AFCM dan Annual report 2012
+ 63
6.16
23
Italcementi
21.1
0.96
5.2
Cemex
41.9
5.2
16.5
Total
21.05
0.55
Holcim
VICEM
Brunei
20,5
9.9
Semen
Indonesia
Vietnam
18
Design Capacity 2013 in Mio Ton
Lokasi pabrik Lafarge dan Holcim lebih menyebar dan saling memperkuat
posisi
18
Cement
Capacity
(MT)
CAPACITY SHARE IN SOUTH EAST ASIA
Capacity Share of Major Players
Vicem
10%
Italcementi
4%
Capacity Share of Major Players Post
Merger
Heidelberger
12%
Other
7%
Heidelberger
12%
Holcim
23%
SMI
17%
Vicem
10%
Italcementi
4%
Other
7%
Lafarge
Holcim
34%
SMI
17%
SCG
13%
Lafarge
11%
Cemex
3%
SCG
13%
Cemex
3%
Dengan merger Lafarge dengan Holcim, maka Kapasitas produksinya mampu memenuhi 34%
konsumsi semen di Asia Tenggara dan meningkat 2 kali kapasitas Semen Indonesia
FINANCIAL UPDATE
SMGR Corporate Presentation
JUNE 2014
FINANCIAL SUMMARY: 1Q2014 RESULTS
Description
(Rpbn)
1Q2013
1Q2014
Change
(%)
Revenue
5,544
6,178
11.4
Cost of revenue
3,059
3,503
14.5
Gross profit
2,485
2,675
7.7
880
1,021
16.0
Operating income
1,605
1,655
3.1
Ebitda
1,862
1,953
4.9
Operating expenses
Profit attributable to
equity holders of parent
entity (Net Income)
1,236
5.4
2,250
2,000
1,750
1,500
1,250
1,000
750
500
250
1,862
1,125
3M-10
1,410
1,185
3M-11
1,953
3M-12
3M-13
3M-14
EBITDA Margin (%)
3M-10
3M-11
3M-12
3M-13
3M-14
34.6%
33.3%
32.9%
33.6%
31.6%
NET INCOME (Rp billion)
EPS (full amount)
Ratio (%)
1,303
EBITDA (Rp billion)
208
Formula
220
5.4
1Q13
1Q14
Ebitda margin
Ebitda / Revenue
33.59
31.61
Interest coverage (x)
Ebitda / Interest
expense
24.65
24.50
Cost ratio
[COGS + Opex] /
Revenue
Total debt to equity *)
Total debt / Total
equity
18.72
18.61
Total debt to asset *)
Total debt / Total asset
13.26
11.96
71.16
73.47
1400
1200
1000
800
600
400
200
1,236
802
3M-10
1,303
1,011
871
3M-11
3M-12
3M-13
3M-14
NET INCOME Margin (%)
3M-10
3M-11
3M-12
3M-13
3M-14
24.7%
24.4%
23.5%
22.3%
21.1%
STRONG BALANCE SHEET AND RETURNS
Cash balance (IDR bn)
Total debt (IDR bn)
* Include short term investment
3.846
2008
5.283
2009
3.905
2010
3.682
2011
3.317
2012
4.083
2012
2013 1Q2014
3.838
4.719
4.213
2013
3.850
1.871
686
251
199
2008
2009
1Q2014
Debt/EBITDA
2010
2011
Return on Assets
2,00x
0,35x
0,06x
0,04x
2008
2009
0.56x 0,50x
24,0%
2012
2008
25,8%
23,5%
20,1%
18,2%
17,4%
2011
2012
2013
0,14x
2010
2011
The projected adjusted debt/EBITDA of 2.0x to
maintain rating level from Moody’s Investors
Service.
2013
2009
2010
REGULAR DIVIDEND PAYMENTS WITH ATTRACTIVE YIELD
Total Dividend Payout
3000
2,416.6
2,181.3
1,962.7
1,829.5 1,816.7
2500
2000
1500
1000
REGULAR DIVIDENDS
Total
Dividend
(IDR billion)
1,261.7
887.7
500
0
2007 2008 2009 2010 2011 2012 2013
SMGR DIVIDEND PAY OUT RATIO IN THE LAST 7 YEARS
Average: 50%
50%
2007
50%
2008
55%
2009
50%
2010
50%
2011
45%
2012
45%
2013
Key determinants of
dividend policy:
• Historical dividend payout
trends
• Comparison with peers
• Projected cash-flows
available for dividends
(after taking into account
potential expansionary
capex etc)
• Analyst and investor
expectations
STRATEGIC PROJECTS
SMGR Corporate Presentation
JUNE 2014
SMGR LONG TERM STRATEGIC FOCUS
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
6. Manage Key Risks
SMIG
CEMENT PLANTS PROJECTS
Capacity Investment
(mn tons) (US$ mn)
Construction
Start
Completed
Indarung VI-SumBar
3.0
352
2013
2015
Q4-2015
Rembang-Java 2
3.0
403
2013
Q2-2016
2016
TOTAL CAPEX
6.0
755
Tuban
New Plants
Location
Tuban’s view
Preheater Tuban IV
Tonasa
Pyroprocessing Tonasa V
Raw Mill Dept. Tonasa V
Tonasa
These strategic projects will ensure sustainability of
the Company’s market leadership
ESP Power Plant
Jetty Extension Area
INSTALLED CAPACITY (Mio Ton)
Installed Capacity
39,3
25,3
17,1
18
19
19
30
31,8
40,8
33,3
20,2
2007 2008 2009 2010 2011 2012 2013 2014F 2015F 2016F 2017F
CONCLUSION: WHY SMGR?
SMGR Corporate Presentation
JUNE 2014
SMGR’s COMPARATIVE & COMPETITIVE ADVANTAGE DRIVES
DRIVE SMGR TO
BE THE MARKET LEADER IN INDONESIA
Outstanding business performance
Strengths of SMGR
Experienced
management
team
Outstanding
business
performance
Favorable
industry
outlook
Conservative
capital
structure and
financial
policies
Outstanding
performance
Robust cash flow
generation
– Leading cement player in Indonesia with over 43.8% market share based on
sales volume for 10M-2013 and approximately 41% share of total installed
cement capacity (Source: Indonesia Cement Association (“ASI”))
– Strategically plants location is close to key markets throughout the country
– As of Dec 2012, acquired Thang Long Cement Company, Vietnam by 70%
share with installed capacity 2.3 mio tons per annum
– Substantial growth opportunities through expansion and optimization
– Superior distribution network and strong brands recognition
– Long-term
Long
access to raw materials for cement production and coal for fuel
consumption
– Concerns on environmental and Corporate Social Responsibility programs to
ensure sustainable growth.
Favourable industry outlook
– Cement consumption pretty much in-line
in
with Indonesian economic growth
– Real estate and infrastructure projects and declining interest rates key
demand drivers
– High barriers to entry (plant, distribution and brand investment costs)
– Disciplined investment on supply side
Robust cash flow generation
– Historically strong revenue, margin and price trends
– High plant utilization and strong focus on cost and revenue management
Conservative capital structure and financial policies
– [Investment grade-like
grade
credit metrics]
– Conservative capital structure policy; low use of leverage
– Access to capital markets for expansion initiatives
Experienced management team
– Experienced and successful management team
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.
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
infrastructur 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 Indone
Indonesia (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.
informa
(
We expressly disclaim any responsibility or liability (express or implied) of PT Semen Indonesia (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 Indonesia (Persero)
Tbk, its affiliated companies or their respective employees or
agents accepts liability for any errors, omission or mis-statements,
statements, negligent or otherwise, in the report and any liability in respect of the report or any inaccuracy therein or omission
omi
therefrom
which might otherwise arise is hereby expresses disclaimed.
Gresik Office:
Semen Indonesia Tower
Jln. Veteran
Gresik 61122 – Indonesia
Phone: (62-31) 3981731 -2, 3981745
Fax: (62-31) 3983209, 3972264
Jakarta Office:
The East Building, 18th Floor,
Jln. DR. Ide Anak Agung Gde Agung Kav. E3.2 No.1,
Mega Kuningan, Jakarta 12950 – Indonesia
Phone : (62-21) 5261174 – 5
Fax
: (62-21) 5261176
www.semenindonesia.com
COGM & COGS BREAKDOWN (1Q-2014)
(
COGM / Ton*
Raw & Supporting
Material
Fuel
Electricity
Direct Labor
1Q-2013(Rp)
28,786
111,032
69,931
47,997
1Q-2014 (Rp)
30,675
121,821
76,794
49,610
CHANGE (%)
6.6%
COGS / Ton**
1Q-2013 (Rp)
1Q-2014 (Rp)
COGM
350,094
386,976
10.5%
Packaging
33,976
37,668
10.9%
Transportation
73,012
87,380
19.7%
Other
24,039
8,759
(63.6%)
481,121
520,784
9.7%
9.8%
3.4%
COGS
Maintenance
39,032
48,392
CHANGE (%)
8.2%
24.0%
**) Divided by sales volume exclude commercial volume for sales
Depletion,
Depreciation &
Amortization
38,036
41,279
8.5%
GA, Tax &
Insurance
15,281
18,405
20.4%
350,094
386,976
10.5%
COGM
*) Divided by cement production exclude commercial volume for production
DOMESTIC DEMAND VS NATIONAL CAPACITY (2013
(201 – 2017)
‘000 tons
Design Capacity
Real Production
Consumption Cement
120,000
100,000
80,000
60,000
40,000
20,000
0
2013
2014F
2015F
2016F
2017F
ton(‘000)
Installed Capacity
Real Production
Consumption
Surplus/(deficit)
Domestic Utilization
Export
Domestic Consumption
Growth
2013
2014F
2015F
2016F
2017F
68,000
55,200
58,580
-3,380
100%
500
71,500
62,205
62,095
110
100%
500
82,200
69,870
65,820
4,050
94%
500
97,800
78,240
69,770
8,470
89%
500
100,800
85,680
73,956
11,724
86%
500
5.5%
6%
6%
6%
6%
ADDITIONAL INSTALLED CAPACITY IN THE NEXT 5 YEARS
New Cement Capacity from Existing Players (2013 – 2017)
No
Company
Targeted Plant
Location
Declared Capacity
(mn tons)
1
Semen
Indonesia
Java, Sumatera,
Sulawesi
11.5
9.0
2
Indocement
Java, Kalimantan
8.8
6.3
1,560 (E)
Cement Mill +
brown/greenfield
3
Holcim
East Java
3.8
3.4
680 (E)
Brown/Greenfield
4
Bosowa
Java, Sulawesi
7.9
3.4
620
Cement Mill + Brownfield
5
Semen Andalas
Sumatera
1.6
0
300
Greenfield
6
Semen Baturaja
Sumatera
2.6
1.5
325
Greenfield/Brownfield
36.2
23.6
TOTAL
Prognose Design Capacity
(mn tons)
970
Prognose Design
Capacity (mn tons)
Remarks
Upgrading +
green/brownfield
4,130
No
Company
Targeted Plant
Location
1
Siam Cement (Thailand)
Sukabumi, West Java
1.8
1.8
360
Greenfield
2
CNBM (China)
Central Java
2.4
0
350
Greenfield, Semen Grobogan
3
Semen Merah Putih
Bayah, Lebak, Banten
11.5
3.0
600
Greenfield (PT Cemindo Gemilg)
4
Anhui Conch Cement
- Tanjung
- Tanah Grogot
- Pontianak
- West Papua
Various
- South Kalimantan
- East Kalimantan
- West Kalimantan
- West Papua
13.7
3.8
3.8
3.8
2.4
3.0
2,350
400
600
600
750
Greenfield
Greenfield
Greenfield
Greenfield
Greenfield
5
Ultratech
Wonogiri, Centr Java
4.5
0
827
Greenfield
6
Semen Puger
East Java
0.6
0
n.a
Upgrading
7
Semen Barru
Barru, South Sulawesi
3.3
0
470
Greenfield (Fajar Group)
8
Semen Panasia
Ajibarang, Central Java
2.0
1.5
240
Greenfield
9
Jui Shin Indonesia
Karawang, West Java
1.5
1.5
n.a
Greenfield
40.3
10.8
4,470
TOTAL
Declared Capacity
(mn tons)
Investment
(US$ mn)
Investment
(US$ mn)
Remarks + Local Partner
Infrastructure Project in Corridor
orridor #1 (Trans Sumatera)
Development Phases:
Phase I (2015-2020)
- Bakauheni-Indralaya
- Pekanbaru-Medan
Phase II (2020-2025)
- Indralaya-Pekanbaru
- Medan-Banda Aceh
- Tebing Tinggi-Sibolga
Phase III (>2025)
- Pekanbaru-Padang
- Palembang-Bengkulu
1
2
Medan - Aceh
3
Pekanbaru - Medan
SEMEN ANADALAS
SEMEN BATURAJA
1
Grinding Plant Lampung
2
Grinding Plant Palembang
SEMEN PADANG
4
5
Indralaya - Pekanbaru
PACKING PLANT
1
Malahayati
2
Lhokseumawe
3
Medan
4
Batam
5
Dumai
Grinding Plant Dumai
SOURCES : DIREKTORAT JENDERAL BINA MARGA
2
Bakaheuni - Indralaya
1
UP GRADING CAPACITY PLAN
Year
Plant
Design Capacity
(mio tons)
Est. Time
Operation
Location
2013
New Cement Mill
1.5
Q3
Tuban
2014
New Cement Mill
0.9
Q3
Dumai
Cement Mill
0.4
Q2
Gresik Plant B
2015
New Cement Mill
1.5
Q3
Tonasa
2015
New Cement Plant
3.0
Q4
Indarung
2016
New Cement Plant
3.0
Q2
Rembang
2017
New Cement Plant
-
-
Domestic Area
0
INDONESIA’S CEMENT INDUSTRY: NOW and THE FUTURE
SMGR Corporate Presentation
JUNE 2014
CEMENT INDUSTRY AT A GLANCE
2
Kuala
Lumpur
Singapore
1
SMGR
3
4
CEMENT INDUSTRY
• Design Capacity
• Production Capacity
• Domestic Growth
• Domestic Utilization
•Supply
Domestic
Export
Import
:
:
:
:
1
1
6
7
5
2013
68.0 mio tons
55.2 mio tons
5.5%
100%
: 58.0 mio tons
: 0.5 mio tons
: 3.3 mio tons2)
2014F 1)
2015F 1)
71.5 mio tons
60.0 mio tons
6.0%
100%
82.2 mio tons
69.8 mio tons
6.0%
94%
61.0 mio tons
0.5 mio tons
3.0 mio tons 3))
65.8 mio tons
0.5 mio tons
3.0 mio tons3)
1) Based on the Company’s forecast
2) Imported cement by PT Semen Andalas (1.0 mio ton) and clinker by Bosawa and Kupang
3) Imported cement & clinker
DOMESTIC CAPACITY (2014)
1. SEMEN INDONESIA
- Semen Padang :
- Semen Gresik :
- Semen Tonasa:
2. Semen Andalas 2)
3. Semen Baturaja
4. Indocement TP
5. Holcim Indonesia
6. Semen Bosowa
7. Semen Kupang
TOTAL
29.5 mn ton
7.3 mn ton
14.4 mn ton
7.8 mn ton
1.6 mn ton
1.3 mn ton
20.5 mn ton
12.1 mn ton
6.0 mn ton
0.5 mn ton
2
71.5 mn ton
COMPARISON: CEMENT CONSUMPTION PER CAPITA 2013
201
kg/capita
kg
1.800
1.600
1.400
1.200
1.000
800
600
400
229
200
0
a
di
In
p
ili
Ph
a
s
ne
pi
si
ne
do
In
nd
la
ai
Th
re
a
si
ay
al
po
m
na
et
Vi
M
a
ng
Si
a
in
Ch
Source: Deutsche, Indonesia Cement Association
INDONESIA’S ECONOMY AND DOMESTIC CEMENT CONSUMPTION GROWTH
(mio tons)
60.0
20.0%
Cement growth % (RHS)
17.7%
GDP growth % (RHS)
Domestic consumption (LHS)
58.0
54.9
50.0
14.5%
48.0
11.5%
40.0
38.1
9.7%
30.0
27.2
20.0
10.0
27.5
5.8%
4.4%
30.2
5.6%
5.1%
Growth
4.7%:
5.8%
31.5
Growth
:
4.2%
2002
2003
5.4%
10.0%
6.10%
6.3%
9.7%
4.60%
6.1%
Growth
:
4.2%
1.8%
2004
2005
Source: Indonesian Cement Association & BPS Statistic
2006
39.1
34.2
Growth6.6%
:
1.1%
1.1%
0.0
32.1
40.8
2.5%
6.00%
23.7
6.50%
Growth
6.0%
:
6.80%
Growth
:
1.8%
6.6%
5.5%
Growth
5.70%
:
3.7%
19.4%
0.0%
2007
2008
2009
2010
2011
2012
2013
5M2014
ARISING INFRASTRUCTURE EXPANSION TREND
Bag and Bulk cement consumption (million tons)
44.1 45.7
45
40
39.2
35
32.2
30
25
22.7
21.0
20
23.7 23.7
25.2 25.5
26.9
32.8
34.2
28.2
20.0
18.1
18.7
16.9
15
10
6.5
5
1.0
1.9
2.3
3.0
3.5
3.8
5.0
6.0
5.1
6.0
5.9
6.2
6.6
8.8
10.8 12.2
5
0
1997
1999
2001
2003
2005
Bagged Cement
2007
Bulk Cement
2009
2011
2013
DOMESTIC MARKET CONSUMPTION (2013)
Bulk
± 21%
Bag
± 79%
•
Ready
Ready-mix
(infrastructure): ± 60%
•
Fabricator (pre-cast,
(pre
fiber cement, cement based industry): ± 35%
•
Projects (mortar, render): ± 5%
•
Housing: ± 90%
•
Cement based industry: ± 10%
Key Drivers of Domestic cement demand:
Source: Internal Research
Retail (residential) sector is the largest
consumer of cement in Indonesia
• National Economic Growth
• Favorable Interest Rate Environment
• Infrastructure Expansion
• Per Capita Consumption increase from
current low levels
DOMESTIC MARKET UPDATE
SMGR Corporate Presentation
JUNE 2014
MARKET BY GEOGRAPHY
Population Distribution (2013)
Cement Distribution (5M2014)
2
4
3
SP
1
SG
7.4%
7.9%
6
ST
5
5.5%
2.3%
Papua
Bali & N T
21.0%
%
Kalimantan
Java
55.9%
Domestic Market Share (5M2014
5M2014)
REGION
MARKET SHARE (%)
SMGR
INTP
SMCB
1. JAVA
41.2
38.2
17.9
2.4
-
2. SUMATERA
42.9
15.2
14.4
3.3
15.6
3. KALIMANTAN
49.3
30.8
11.3
8.6
4. SULAWESI
61.5
15.4
0.9
5. NUSA TENGGR.
40.9
33.9
6. EASTERN IND.
54.2
TOTAL
INDONESIA
44.0
BSWA ANDLS BTRJA
KPG
-
0.2
8.6
-
-
-
-
22.1
-
-
-
4.3
16,0
-
-
4.8
21.1
0.7
23.8
-
-
30.5
14.
14.2
5.7
3.2
1.8
5.5%
1.5%
5.8%
Sulawesi
Sumatera
8.4%
0.4
Sumatera
21.3%
Java
57.5.%
MARKET UPDATE - Cement Consumption 5M2014
5M 2014 - SMGR Sales Volume (million tons)
DESCRIPTION
5M 2014 – Domestic Consumption (mio tons)
5M-14
5M-13
10,467,232
10,017,522
4.5
Semen Indonesia
5,648,678
5,190,159
8.8
Semen Padang
2,723,628
2,796,549
(2.6)
Semen Tonasa
2,094,926
2,030,813
3.2
22,155
89,907
(75.4)
10,489,387
10,107,429
3.8
DOMESTIC
EXPORT
GRAND TOTAL
CHANGE (%)
SMGR Sales Type (mio tons)
5M-14
5M-13
YoY Change
Bag
7.9 (76.4%)
7.7 (77.6%)
2.8%
Bulk
2.4 (23.6%)
2.2 (22.4%)
10.0%
Industry Sales Type (mio tons)
AREA
5M 2014
5M 2013
CHANGE (%)
Jakarta
2,369,820
2,177,464
8.8
Banten
1,276,761
1,382,750
(7.7)
West Java
3,575,296
3,288,320
8.7
Central Java
2,544,369
2,578,205
(1.3)
389,026
368,214
5.7
3,132,778
2,869,734
9.2
13,288,051
12,664,688
4.9
Sumatera
4,989,864
4,932,070
1.2
Kalimantan
1,882,895
1,803,045
4.4
Sulawesi
1,763,360
1,622,599
8.7
Nusa Tenggara
1,317,726
1,355,331
(2.8)
542,968
556,752
(2.5)
23,784,864
22,934,485
3.7
32,155
85,240
(62.3)
-
21,467
(100.0)
32,155
106,707
(69.9)
23,817,019
23,041,192
3.4
Yogyakarta
East Java
Total Java
Maluku & Papua
TOTAL
INDONESIA
Export Cement
5M-14
5M-13
YoY Change
Bag
18.7 (78.9%)
18.2 (79.5%)
2.9%
Bulk
5.0 (21.1%)
4.7 (20.5%)
6.6%
*) Source: Indonesia Cement Association, un-audited figures
Export Clinker
Total Export
GRAND TOTAL
COMPANY PROFILE
SMGR Corporate Presentation
JUNE 2014
SMGR IS THE #1 CEMENT COMPANY IN INDONESIA
BRIEF HISTORY
1957 : Inauguration of Gresik I, installed capacity of 250,000 ton cement per annum
1991 : Initial Public Offering, Market Cap.: IDR0.63tn, resulting shareholding structure post IPO:
1995
1998
2006
2010
2011
2012
● Government of Republic of Indonesia: 73%
● Public: 27%
: Acquisition of PT Semen Padang (Persero)) and PT Semen Tonasa (Persero)
: Cemex became a strategic partner, Market Cap.: IDR4.9tn
: Blue Valley Holdings bought Cemex’s 24.9% stake in SMGR, Market Cap.: IDR21.5tn
: In March 31, Blue Valley Holdings sold all of its stake ownership in SMGR, Market Cap per April 30, 2010: IDR72.1tn
0mm tons, Market Cap per June 29, 2012: IDR67.0tn
: Total installed capacity of 20.00mm
: Acquisition of Thang Long Cement Vietnam, Total
otal installed capacity of 2.3mm tons, Market Cap Dec 19th, 2012: IDR91.9tn
SMGR CAPACITY BUILD-OUT (Mio TONS)
30,0
consolidated capacity
Post-consolidated
25,0
• Total Installed capacity: 30 million
tons (2013) including TLCC;
20,0
• Market share of Semen Indonesia in
2013 was 44% based on sales volume
15,0
10,0
5,0
• 2013 Revenues amounted to IDR 19.6
trillion (equivalent to EUR 1.2 billion),
with EBITDA margin of 35%
Pre-consolidated capacity
_
_
_
_
_
_
19 70
19 80
19 8
19 4
8
19 5
86
19 90
19 9
19 5
9
19 7
98
20 0
20 6
0
20 7
0
20 8
0
20 9
1
20 0
1
20 1
1
20 2
13
19
57
0,0
FOCUS IN CORE BUSINESS
OWNERSHIP STRUCTURE1
The Government of the Republic of Indonesia
Public
51.01%
48.99%
PT Semen Indonesia (Persero)
(
Tbk.
99.99%
PT Semen Padang
99.99%
99.23%
PT Semen Tonasa
PT Semen Gresik
Name
Activities
% Ownership
1. Igasar
Cement distribution & Trading
12.00%
2. Sepatim B
General trading, cement packaging 85.00%
3. Bima SA
General trading, cement packaging 80.00%
4. SUPS
Cement Packaging
10.00%
Thang Long Cement, VN
Name
Name
Activities
Activities
% Ownership
% Ownership
1. UTSG
UTSG
1.
Limestone
& Clay
Mining
Limestone
& Clay
Mining
55.00%
55.00%
2. IKSG
IKSG
2.
Packaging
Paper
Cement
Packaging
60.00%
60.00%
3. KIG
KIG
3.
Industrial
Estate
65.00%
Industrial
Estate
4. Swadaya Graha65.00%
Contractor & Machine Fabricator 25.00%
Swadaya
Gra
Steel
fabrication,
4.
5. Varia Usaha
Transport
and contractor
general trading 25.00%
24.90%
Usaha
and
general trading
24.90%
5.
6. Varia
Eternit
Gresik Transport
Building
materials
17.60%
6.
7.
7.
8.
Eternit
Gresik
Building
SGG Energy
Prima
Coal materials
Mining and Trading
SGG
Trading
Coal
SGG Prima
Prima Coal
Beton
Ready
Mix Concrete
8. SGG Prima Beton Ready Mix Concrete
¹ As of Jan, 2014
70.00%
17.60%
97.00%
99.99%
99.99%
99.99%
REGIONAL CEMENT PLAYERS
SMGR Corporate Presentation
JUNE 2014
COMPETITIVENESS OF SEMEN INDONESIA
Kiln
1 unit
Cement
Mill
1 unit
Integrated Cement Plant
Kiln
13 Unit
Cement Mill
22 Unit
Grinding Plant
Grinding
Plant
Kiln
4 unit
Cement
Mill
6 unit
Kiln
4 unit
Cement
Mill
9 unit
Cement Mill
1 unit Cement
Mill
Grinding
Plant
3 unit Cement
Mill
4 location
2 location
4 Unit
Warehouse
30 location
Packing Plant
22 location
Sea Port
11 location
Kiln
4 unit
Cement
Mill
6 unit
STRATEGIC
TRATEGIC POSITION IN THE REGION
Kiln
1 unit
Cement
Mill
1 unit
Grinding
Plant
1 unit Cement
Mill
NEW TARGET
Kiln
4 unit
Cement
Mill
6 unit
Kiln
4 unit
Cement
Mill
9 unit
Grinding
Plant
3 unit Cement
Mill
Kiln
4 unit
Cement
Mill
6 unit
SUPPLY-DEMAND
DEMAND CEMENT IN SOUTH EAST ASIA
Potential Market
Cap. : 1.5 mio
Cap. : 54.4 mio
Cap. : 5.6 mio
Export :
Clinker : 6.17
Cement: 5.77
Cap. : 75 mio
Cap. : 22 mio
Cap. : 1.0 mio
Cap. : 0.55 mio
Cap. : - mio
Cap. : 66.4 mio
Cap. : 28.9 mio
Source : Global cement
MAJOR PLAYERS IN SOUTH EAST ASIA
Cement Plant Capacity of Major Player in
South East Asia
Cement Plant Capacity of Major Player in
South East Asia after LafargeHolcim Merger
25
35
30
20
25
20
No of Plant
No of Plant
15
Holcim
Heidelberger
Semen Indonesia
10
5
SCG
0
10
0
Italcementi
-10
10
20
30
40
50
Vicem
SCG
Cemex Italcementi
0
-5
Semen Indonesia
Heidelberger
5
0
-10
15
Lafarge
VIcem
Cemex
LafargeHolcim
10
20
30
40
50
60
70
Cement Plant Capacity (Milion Ton)
Cement Plant Capacity (Milion Ton)
•Setelah
Setelah merger Holcim dan Lafarge, total kapasitas perusahaan menjadi 63 Juta Ton atau 2
kali lipat kapasitas Semen Indonesia dan memiliki Kapasitas yang dapat memenuhi 34%
konsumsi semen di Asia Tenggara
• LafargeHolcim dan Semen Indonesia merupakan Perusahaan Semen yang terkemuka di Asia
Tenggara
80
CEMENT PLAYERS IN SOUTH EAST ASIA
Company
Heidelberg
Indonesia
Malaysia
Philip.
Thailand
1.2
1,6
Lafarge
Cambodia
12.5
9.1
0.5
6,5
Siam Cement
0.5
29.5
2.3
23.5
31.8
7
7
Sources : AFCM dan Annual report 2012
+ 63
6.16
23
Italcementi
21.1
0.96
5.2
Cemex
41.9
5.2
16.5
Total
21.05
0.55
Holcim
VICEM
Brunei
20,5
9.9
Semen
Indonesia
Vietnam
18
Design Capacity 2013 in Mio Ton
Lokasi pabrik Lafarge dan Holcim lebih menyebar dan saling memperkuat
posisi
18
Cement
Capacity
(MT)
CAPACITY SHARE IN SOUTH EAST ASIA
Capacity Share of Major Players
Vicem
10%
Italcementi
4%
Capacity Share of Major Players Post
Merger
Heidelberger
12%
Other
7%
Heidelberger
12%
Holcim
23%
SMI
17%
Vicem
10%
Italcementi
4%
Other
7%
Lafarge
Holcim
34%
SMI
17%
SCG
13%
Lafarge
11%
Cemex
3%
SCG
13%
Cemex
3%
Dengan merger Lafarge dengan Holcim, maka Kapasitas produksinya mampu memenuhi 34%
konsumsi semen di Asia Tenggara dan meningkat 2 kali kapasitas Semen Indonesia
FINANCIAL UPDATE
SMGR Corporate Presentation
JUNE 2014
FINANCIAL SUMMARY: 1Q2014 RESULTS
Description
(Rpbn)
1Q2013
1Q2014
Change
(%)
Revenue
5,544
6,178
11.4
Cost of revenue
3,059
3,503
14.5
Gross profit
2,485
2,675
7.7
880
1,021
16.0
Operating income
1,605
1,655
3.1
Ebitda
1,862
1,953
4.9
Operating expenses
Profit attributable to
equity holders of parent
entity (Net Income)
1,236
5.4
2,250
2,000
1,750
1,500
1,250
1,000
750
500
250
1,862
1,125
3M-10
1,410
1,185
3M-11
1,953
3M-12
3M-13
3M-14
EBITDA Margin (%)
3M-10
3M-11
3M-12
3M-13
3M-14
34.6%
33.3%
32.9%
33.6%
31.6%
NET INCOME (Rp billion)
EPS (full amount)
Ratio (%)
1,303
EBITDA (Rp billion)
208
Formula
220
5.4
1Q13
1Q14
Ebitda margin
Ebitda / Revenue
33.59
31.61
Interest coverage (x)
Ebitda / Interest
expense
24.65
24.50
Cost ratio
[COGS + Opex] /
Revenue
Total debt to equity *)
Total debt / Total
equity
18.72
18.61
Total debt to asset *)
Total debt / Total asset
13.26
11.96
71.16
73.47
1400
1200
1000
800
600
400
200
1,236
802
3M-10
1,303
1,011
871
3M-11
3M-12
3M-13
3M-14
NET INCOME Margin (%)
3M-10
3M-11
3M-12
3M-13
3M-14
24.7%
24.4%
23.5%
22.3%
21.1%
STRONG BALANCE SHEET AND RETURNS
Cash balance (IDR bn)
Total debt (IDR bn)
* Include short term investment
3.846
2008
5.283
2009
3.905
2010
3.682
2011
3.317
2012
4.083
2012
2013 1Q2014
3.838
4.719
4.213
2013
3.850
1.871
686
251
199
2008
2009
1Q2014
Debt/EBITDA
2010
2011
Return on Assets
2,00x
0,35x
0,06x
0,04x
2008
2009
0.56x 0,50x
24,0%
2012
2008
25,8%
23,5%
20,1%
18,2%
17,4%
2011
2012
2013
0,14x
2010
2011
The projected adjusted debt/EBITDA of 2.0x to
maintain rating level from Moody’s Investors
Service.
2013
2009
2010
REGULAR DIVIDEND PAYMENTS WITH ATTRACTIVE YIELD
Total Dividend Payout
3000
2,416.6
2,181.3
1,962.7
1,829.5 1,816.7
2500
2000
1500
1000
REGULAR DIVIDENDS
Total
Dividend
(IDR billion)
1,261.7
887.7
500
0
2007 2008 2009 2010 2011 2012 2013
SMGR DIVIDEND PAY OUT RATIO IN THE LAST 7 YEARS
Average: 50%
50%
2007
50%
2008
55%
2009
50%
2010
50%
2011
45%
2012
45%
2013
Key determinants of
dividend policy:
• Historical dividend payout
trends
• Comparison with peers
• Projected cash-flows
available for dividends
(after taking into account
potential expansionary
capex etc)
• Analyst and investor
expectations
STRATEGIC PROJECTS
SMGR Corporate Presentation
JUNE 2014
SMGR LONG TERM STRATEGIC FOCUS
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
6. Manage Key Risks
SMIG
CEMENT PLANTS PROJECTS
Capacity Investment
(mn tons) (US$ mn)
Construction
Start
Completed
Indarung VI-SumBar
3.0
352
2013
2015
Q4-2015
Rembang-Java 2
3.0
403
2013
Q2-2016
2016
TOTAL CAPEX
6.0
755
Tuban
New Plants
Location
Tuban’s view
Preheater Tuban IV
Tonasa
Pyroprocessing Tonasa V
Raw Mill Dept. Tonasa V
Tonasa
These strategic projects will ensure sustainability of
the Company’s market leadership
ESP Power Plant
Jetty Extension Area
INSTALLED CAPACITY (Mio Ton)
Installed Capacity
39,3
25,3
17,1
18
19
19
30
31,8
40,8
33,3
20,2
2007 2008 2009 2010 2011 2012 2013 2014F 2015F 2016F 2017F
CONCLUSION: WHY SMGR?
SMGR Corporate Presentation
JUNE 2014
SMGR’s COMPARATIVE & COMPETITIVE ADVANTAGE DRIVES
DRIVE SMGR TO
BE THE MARKET LEADER IN INDONESIA
Outstanding business performance
Strengths of SMGR
Experienced
management
team
Outstanding
business
performance
Favorable
industry
outlook
Conservative
capital
structure and
financial
policies
Outstanding
performance
Robust cash flow
generation
– Leading cement player in Indonesia with over 43.8% market share based on
sales volume for 10M-2013 and approximately 41% share of total installed
cement capacity (Source: Indonesia Cement Association (“ASI”))
– Strategically plants location is close to key markets throughout the country
– As of Dec 2012, acquired Thang Long Cement Company, Vietnam by 70%
share with installed capacity 2.3 mio tons per annum
– Substantial growth opportunities through expansion and optimization
– Superior distribution network and strong brands recognition
– Long-term
Long
access to raw materials for cement production and coal for fuel
consumption
– Concerns on environmental and Corporate Social Responsibility programs to
ensure sustainable growth.
Favourable industry outlook
– Cement consumption pretty much in-line
in
with Indonesian economic growth
– Real estate and infrastructure projects and declining interest rates key
demand drivers
– High barriers to entry (plant, distribution and brand investment costs)
– Disciplined investment on supply side
Robust cash flow generation
– Historically strong revenue, margin and price trends
– High plant utilization and strong focus on cost and revenue management
Conservative capital structure and financial policies
– [Investment grade-like
grade
credit metrics]
– Conservative capital structure policy; low use of leverage
– Access to capital markets for expansion initiatives
Experienced management team
– Experienced and successful management team
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.
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
infrastructur 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 Indone
Indonesia (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.
informa
(
We expressly disclaim any responsibility or liability (express or implied) of PT Semen Indonesia (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 Indonesia (Persero)
Tbk, its affiliated companies or their respective employees or
agents accepts liability for any errors, omission or mis-statements,
statements, negligent or otherwise, in the report and any liability in respect of the report or any inaccuracy therein or omission
omi
therefrom
which might otherwise arise is hereby expresses disclaimed.
Gresik Office:
Semen Indonesia Tower
Jln. Veteran
Gresik 61122 – Indonesia
Phone: (62-31) 3981731 -2, 3981745
Fax: (62-31) 3983209, 3972264
Jakarta Office:
The East Building, 18th Floor,
Jln. DR. Ide Anak Agung Gde Agung Kav. E3.2 No.1,
Mega Kuningan, Jakarta 12950 – Indonesia
Phone : (62-21) 5261174 – 5
Fax
: (62-21) 5261176
www.semenindonesia.com
COGM & COGS BREAKDOWN (1Q-2014)
(
COGM / Ton*
Raw & Supporting
Material
Fuel
Electricity
Direct Labor
1Q-2013(Rp)
28,786
111,032
69,931
47,997
1Q-2014 (Rp)
30,675
121,821
76,794
49,610
CHANGE (%)
6.6%
COGS / Ton**
1Q-2013 (Rp)
1Q-2014 (Rp)
COGM
350,094
386,976
10.5%
Packaging
33,976
37,668
10.9%
Transportation
73,012
87,380
19.7%
Other
24,039
8,759
(63.6%)
481,121
520,784
9.7%
9.8%
3.4%
COGS
Maintenance
39,032
48,392
CHANGE (%)
8.2%
24.0%
**) Divided by sales volume exclude commercial volume for sales
Depletion,
Depreciation &
Amortization
38,036
41,279
8.5%
GA, Tax &
Insurance
15,281
18,405
20.4%
350,094
386,976
10.5%
COGM
*) Divided by cement production exclude commercial volume for production
DOMESTIC DEMAND VS NATIONAL CAPACITY (2013
(201 – 2017)
‘000 tons
Design Capacity
Real Production
Consumption Cement
120,000
100,000
80,000
60,000
40,000
20,000
0
2013
2014F
2015F
2016F
2017F
ton(‘000)
Installed Capacity
Real Production
Consumption
Surplus/(deficit)
Domestic Utilization
Export
Domestic Consumption
Growth
2013
2014F
2015F
2016F
2017F
68,000
55,200
58,580
-3,380
100%
500
71,500
62,205
62,095
110
100%
500
82,200
69,870
65,820
4,050
94%
500
97,800
78,240
69,770
8,470
89%
500
100,800
85,680
73,956
11,724
86%
500
5.5%
6%
6%
6%
6%
ADDITIONAL INSTALLED CAPACITY IN THE NEXT 5 YEARS
New Cement Capacity from Existing Players (2013 – 2017)
No
Company
Targeted Plant
Location
Declared Capacity
(mn tons)
1
Semen
Indonesia
Java, Sumatera,
Sulawesi
11.5
9.0
2
Indocement
Java, Kalimantan
8.8
6.3
1,560 (E)
Cement Mill +
brown/greenfield
3
Holcim
East Java
3.8
3.4
680 (E)
Brown/Greenfield
4
Bosowa
Java, Sulawesi
7.9
3.4
620
Cement Mill + Brownfield
5
Semen Andalas
Sumatera
1.6
0
300
Greenfield
6
Semen Baturaja
Sumatera
2.6
1.5
325
Greenfield/Brownfield
36.2
23.6
TOTAL
Prognose Design Capacity
(mn tons)
970
Prognose Design
Capacity (mn tons)
Remarks
Upgrading +
green/brownfield
4,130
No
Company
Targeted Plant
Location
1
Siam Cement (Thailand)
Sukabumi, West Java
1.8
1.8
360
Greenfield
2
CNBM (China)
Central Java
2.4
0
350
Greenfield, Semen Grobogan
3
Semen Merah Putih
Bayah, Lebak, Banten
11.5
3.0
600
Greenfield (PT Cemindo Gemilg)
4
Anhui Conch Cement
- Tanjung
- Tanah Grogot
- Pontianak
- West Papua
Various
- South Kalimantan
- East Kalimantan
- West Kalimantan
- West Papua
13.7
3.8
3.8
3.8
2.4
3.0
2,350
400
600
600
750
Greenfield
Greenfield
Greenfield
Greenfield
Greenfield
5
Ultratech
Wonogiri, Centr Java
4.5
0
827
Greenfield
6
Semen Puger
East Java
0.6
0
n.a
Upgrading
7
Semen Barru
Barru, South Sulawesi
3.3
0
470
Greenfield (Fajar Group)
8
Semen Panasia
Ajibarang, Central Java
2.0
1.5
240
Greenfield
9
Jui Shin Indonesia
Karawang, West Java
1.5
1.5
n.a
Greenfield
40.3
10.8
4,470
TOTAL
Declared Capacity
(mn tons)
Investment
(US$ mn)
Investment
(US$ mn)
Remarks + Local Partner
Infrastructure Project in Corridor
orridor #1 (Trans Sumatera)
Development Phases:
Phase I (2015-2020)
- Bakauheni-Indralaya
- Pekanbaru-Medan
Phase II (2020-2025)
- Indralaya-Pekanbaru
- Medan-Banda Aceh
- Tebing Tinggi-Sibolga
Phase III (>2025)
- Pekanbaru-Padang
- Palembang-Bengkulu
1
2
Medan - Aceh
3
Pekanbaru - Medan
SEMEN ANADALAS
SEMEN BATURAJA
1
Grinding Plant Lampung
2
Grinding Plant Palembang
SEMEN PADANG
4
5
Indralaya - Pekanbaru
PACKING PLANT
1
Malahayati
2
Lhokseumawe
3
Medan
4
Batam
5
Dumai
Grinding Plant Dumai
SOURCES : DIREKTORAT JENDERAL BINA MARGA
2
Bakaheuni - Indralaya
1
UP GRADING CAPACITY PLAN
Year
Plant
Design Capacity
(mio tons)
Est. Time
Operation
Location
2013
New Cement Mill
1.5
Q3
Tuban
2014
New Cement Mill
0.9
Q3
Dumai
Cement Mill
0.4
Q2
Gresik Plant B
2015
New Cement Mill
1.5
Q3
Tonasa
2015
New Cement Plant
3.0
Q4
Indarung
2016
New Cement Plant
3.0
Q2
Rembang
2017
New Cement Plant
-
-
Domestic Area