PT Alamtri Resources Indonesia Tbk · IDX:ADRO
PT Alamtri Resources Indonesia Tbk — PT Adaro Energy — Morgan Stanley Annual Asia Pacific Summit 2011
38 slides from PT Alamtri Resources Indonesia Tbk's conference presentation, Nov 15, 2011
Slide 1: On Track to Build a Bigger and Better Adaro Energy
On Track to Build a Bigger and Better Adaro Energy ------------------------------------------------------------- Morgan Stanley Annual Asia Pacific Summit Singapore 15-17 November 2011
Slide 2: Disclaimer
Disclaimer These materials have been prepared by PT Adaro Energy (the “Company”) and have not been independently verified. No representation or warranty, expressed or implied, is made and no reliance should be placed on the accuracy, fairness or completeness of the information presented or contained
Slide 3: Agenda
Agenda Recent Developments Adaro’s Integrated Business Strategy Why Adaro Energy? 2
Slide 4: 9M11 – Adaro Energy's Operational and Financial Results
9M11 – Adaro Energy’s Operational and Financial Results 9M11 9M10 % Change OPERATIONAL Coal Produced (mt) 35.3 31.8 11.0% Coal Sold (mt) 38.3 32.4 18.2% Strip Ratio (x) 5.9 5.5 - FINANCIAL Net Revenue 2,925 1,981 47.7% Cost of Revenue (1,919) (1,352) 42.0% Operating Income 911 559 63.0% Operating Ma
Slide 5: Agenda
Agenda Recent Developments Adaro’s Integrated Business Strategy Why Adaro Energy? 4
Slide 6: Adaro Indonesia – A Snapshot
Adaro Indonesia – A Snapshot Adaro Indonesia Highlights 2009A: 40.6 Mt 9 Largest single-site coal producer in southern Production 2010A: 42.2 Mt (5-year CAGR of 10%) hemisphere (10 year CAGR of 11%) Sub-bituminous, medium calorific value, 9 Top 5 thermal coal exporter globally Envirocoal ultra
Slide 7: Adaro Energy - Vision
Adaro Energy - Vision To be a Leading Indonesian Mining and Energy Group 6
Slide 8: Simplified structure
Creating Sustainable Value from Indonesian Coal Listed on IDX in July 2008 PIT TO POWER INTEGRATION Adaro Energy 9M11: Revenue: US$2,925million PT Adaro Energy Tbk EBITDA: US$1,046million Adaro Mining Adaro Adaro Alam Tri Abadi Adaro Power Services Logistics Marketing Simplified structure 100% 2
Slide 9: PT Adaro Indonesia
Balikpapan East Kalimantan Central Kalimantan Tanjung Kelanis Barge River Terminal PT Adaro Indonesia Banjarmasin South Kalimantan Taboneo Anchorage Domestic and Direct Barging South Pulau Laut Coal Terminal Coal and Fuel Storage Handling Port 8 8
Slide 10: PT Adaro Indonesia - Mining
PT Adaro Indonesia - Mining Coal Reserves Coal Mining Coal Hauling Coal Crushing Coal Barging Coal Loading Coal Port Resources Measured Indicated Inferred Total (Mt) Wara Deposit (Mt) (Mt) (Mt) Tutupan 775 814 865 2,455 North 117 96 85 299 Paringin Wara 1 492 366 449 1,307 Wara 2 133 134 100 368 Tot
Slide 11: Largest single site coal mine in the southern hemisphere
Largest single site coal mine in the southern hemisphere 10 10
Slide 12: Dedicated Coal Hauling Road
Dedicated Coal Hauling Road Coal Reserves Coal Mining Coal Hauling Coal Crushing Coal Barging Coal Loading Coal Port Hauling Equipment Capacity: 60 million tonnes Hauling Road Capacity: 80 million tonnes Hauling Road Distance: 80 km Hauling Road Vehicles: 200 road trains Balikpapan East Kalimantan C
Slide 13: Kelanis: One of World's Largest Inland Bulk Terminals
Kelanis: One of World’s Largest Inland Bulk Terminals Coal Reserves Coal Mining Coal Hauling Coal Crushing Coal Barging Coal Loading Coal Port Crushing Capacity: - 7 crushers with total capacity of 7,500 tph - Annual capacity of 55 Mt Stockpiling Capacity: 2 stockpiles with capacity of 250,000t Barg
Slide 14: PT Maritim Barito Perkasa (MBP) – Barging
PT Maritim Barito Perkasa (“MBP”) – Barging Coal Reserves Coal Mining Coal Hauling Coal Crushing Coal Barging Coal Loading Coal Port Balikpapan East Kalimantan Central Kalimantan Tanjung Kelanis Barge River Terminal Banjarmasin South Kalimantan Taboneo Anchorage Domestic and Direct Barging South Pul
Slide 15: PT Sarana Daya Mandiri (SDM) – Dredging/Water Tolling
PT Sarana Daya Mandiri (“SDM”) – Dredging/Water Tolling Coal Reserves Coal Mining Coal Hauling Coal Crushing Coal Barging Coal Loading Coal Port Adaro’s Innovative Solution to Dredging was completed was started commercial operation on River Bottleneck: January 1, 2009. Subsequently, capacity of the
Slide 16: PT Maritime Barito Perkasa (MBP) – Shiploading
PT Maritime Barito Perkasa (“MBP”) – Shiploading Coal Reserves Coal Mining Coal Hauling Coal Crushing Coal Barging Coal Loading Coal Port Vessels with their own gear and grabs at the Taboneo anchorage MBP’s floating cranes Balikpapan East Kalimantan 9M11: Central Kalimantan Total Coal Loaded: Tanjun
Slide 17: PT Indonesia Bulk Terminal (IBT) – Coal Terminal Services
PT Indonesia Bulk Terminal (“IBT”) – Coal Terminal Services Coal Reserves Coal Mining Coal Hauling Coal Crushing Coal Barging Coal Loading Coal Port Shell’s fuel terminal recently constructed at IBT’s facility Balikpapan East Kalimantan Central Kalimantan Tanjung Kelanis Barge River Terminal Banjarm
Slide 18: IndoMet Coal project map
IndoMet Coal project Strong control Medium control River East Provincial Kalimantan border Kelanis River Tanjung Central Terminal Kalimantan Warukin airport South Barito Kalimantan River Banjarmasin Taboneo Anchorage 17
Slide 19: Strategy – Sustainable Growth and Diversification
Strategy – Sustainable Growth and Diversification Current Strategy Action Plan Resources Growth of Tap into Adaro Energy’s Increase of resources by 900 Mt to 4.4 Bt since Increase coal resources operational expertise and December 2008 through exploration and shareholders contacts to acquisitio
Slide 20: Group Operations and Coal Acquisitions
Group Operations and Coal Acquisitions Diversify Geography, Licenses and Products • Adaro Indonesia, South Kalimantan (thermal coal; resources 4.4 Bt) • 25% JV with BHP Billiton, IndoMet Coal project, Central Kalimantan (coking coal; resources 774 Mt). • 75% stake in MIP, a greenfield coal project,
Slide 21: Agenda
Agenda Recent Developments Adaro’s Integrated Business Strategy Why Adaro Energy? 20
Slide 22: Why Adaro Energy?
Why Adaro Energy? #7 Strong Corporate Governance, Reputable #1 Shareholders, and Experienced Robust Industry Management Team Fundamentals with Proven Track and Outlook Record #6 Good Access #2 to Capital Abundant Resources and Scale #5 Diversified and #3 Loyal Customer Benefit from the Base with Wel
Slide 23: Robust Industry Fundamentals and Outlook
1 Robust Industry Fundamentals and Outlook China’s growth – implications for Energy Sector 22
Slide 24: Electricity Demand - India, Indonesia still have long way to catch up
Robust Industry Fundamentals and Outlook 1 Electricity Demand - India, Indonesia still have long way to catch up….. Potential from Growth in Electricity Consumption Canada Electricity Consumption (Kwh/Capita) US Asia Korea Asia Indonesia Japan France Russia Germany China Brazil WORLD Thailand India
Slide 25: Robust Industry Prospects
1 Robust Industry Prospects China’s role in demand for fossil fuels Sharp increase in consumption of energy in China in the last R/P Oil Gas Coal decade has set a growth momentum for the Energy sector (in years) 10.00% 9.00% 8.00% 7.00% Global 46.2 58.6 118.4 6.00% 5.00% 4.00% China 9.9 29.0 35.3 3.
Slide 26: Strong Demand for Low CV Coal
1 Robust Industry Fundamentals and Outlook Strong Demand for Low CV Coal Demand for Adaro Indonesia’s Coal Specifications is Expected to Grow Strongly Price (US$/tonne) 140 Asia is expected to make up 76% of total global sea- borne trade in 2021 and contribute 82% of the growth from 2010 to 2021 1
Slide 27: Indonesia's Advantage in the Midst of Tight Supply Environment
Robust Industry Fundamentals and Outlook 1 Indonesia’s Advantage in the Midst of Tight Supply Environment Tight Supply Potential supply constraints include government policies and regulations in most export markets such as: – South Africa: Export quota to satisfy Eskom domestic requirement; labor
Slide 28: Tight Supply Environment
Robust Industry Fundamentals and Outlook 1 Tight Supply Environment 1000 900 903 930 928 896 864 874 800 823 793 Mn tonnes 770 751 700 725 689 689 685 685 683 673 673 638 638 600 584 584 500 400 300 2005 2006 2007 2008 2009 2010F 2011F 2012F 2013F 2014F 2015F Demand Supply Source: Australian Mineral
Slide 29: Abundant Resources and Scale
2 Abundant Resources and Scale Reserves and Resources Evolution 2010 Largest Producing Mine in Southern Hemisphere (Mt) MT 5,000 4,500 4,000 3,500 3,000 3,490 2,500 2,554 2,000 1,865 1,500 2,427 1,920 Top 5 Global Thermal Coal Exporters (Mt) 1,000 500 938 930 938 60 448 414 - 40 2005 2006 2007 2008
Slide 30: Benefit from the Fully Integrated Operations of AE
3 Benefit from the Fully Integrated Operations of AE Detailed Planning and Execution of Operations Expansion and Integration Adaro Indonesia benefits from the vertically integrated operations of the Group. Each subsidiary is positioned to be an independent and competitive profit center allowing sign
Slide 31: Low Cost Producer with High Margins
4 Low Cost Producer with High Margins Adro 9M11 EBITDA Margin (%) Source: Bloomberg *) the company has not published its 9M11 financial results Adaro stood amongst the best EBITDA margin in Indonesian thermal coal at 36% as of 9M11, despite having a moderate heat value coal due to good cost control
Slide 32: Highly Differentiated Product – Envirocoal
5 Highly Differentiated Product – EnvirocoalTM Coal 25 brands within global export trade Lowest ash content among coals produced for global export trade, providing consumers with significant cost savings 20 ASH % (adb) Ash 15 Content Blending Envirocoal with higher ash coal reduces the on-costs
Slide 33: Diversified and Loyal Customer Base and High Earnings Visibility
5 Diversified and Loyal Customer Base and High Earnings Visibility Customer type by volume (9M11) ` Loyal long term customers – Mostly “sovereign backed” power companies 10% 4% – More than 50% have relationship of > 10 years Power cement Average length of coal supply agreements is 5 others years
Slide 34: Exceptional Access to Capital
6 Exceptional Access to Capital 9 US$800 million 10 year, non call 5, Reg S/144A, Guaranteed Senior Notes • Currently rated at Ba1 and BB+ 9 US$500 million 5 year, Amortizing Revolving Credit Facility 9 US$400 million 7 year, concluded with 12 banks • Undrawn $100M 9 US$750 million 10 year bank loan
Slide 35: CSR Commitment has been Recognised
7 CSR Commitment has been Recognised Gold Category in Indonesian Corporate Social Responsibility Awards 2008 Presented by Ministry of Social Affairs, Republic of Indonesia Indonesian Corporate Social Responsibility Award 2008 First rank for Social and second rank for Environment and third rank for E
Slide 36: Reputable Shareholders and Strong Corporate Governance
7 Reputable Shareholders and Strong Corporate Governance Reputable and Supportive Shareholders Wide Recognition Across the Board Top Performing Listed Companies 2010 by Investor Edwin Soeryadjaya Magazine Teddy Rachmat Boy Garibaldi Thohir together hold International Coal Producer of the Y
Slide 37: Experienced Management Team with Proven Track Record
7 Experienced Management Team with Proven Track Record Management Team with Proven Track Record 9 Benefits from experience and active participation of key shareholders’ representatives More than 128 9 High operating and safety standards years of combined Combined 68 years Average 11 years industry w
Slide 38: Thank you
Thank you 37
PT Adaro Energy — Morgan Stanley Annual Asia Pacific Summit 2011 on 6ix