Investor Summit & Capital Market Expo 2015

Transcription

1 Analyst briefing Investor Summit & Capital Market Expo Q15 performance results 13 th August 2015 Jakarta, 12 Nov 2015

2 DISCLAIMER The views expressed here contain information derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. Any forward looking information in this presentation has been prepared on the basis of a number of assumptions which may prove to be incorrect. This presentation should not be relied upon as a recommendation or forecast by PT. Indo Tambangraya Megah Tbk. Nothing in this release should be construed as either an offer to buy or sell or a solicitation of an offer to buy or sell shares in any jurisdiction 2

3 Introduction Operational review Commercial review Financial review 3

4 Highlights of 3Q15 and 9M15 results Coal sales 6.8 Mt Down 0.1Mt Coal sales 20.9 Mt Down 0.8Mt Unit: USD Million 2Q15-1% Q-Q 3Q15 Q-Q 9M14* -4% Y-Y 9M15 y-y Total Revenue % 1,488 1,206-19% Gross Profit Margin 19% 22% +3% 21% 22% +1% EBIT % % EBITDA % % Net Income % % ASP (USD/ton) $57.2 $55.9-2% $68.7 $ % *) Restated due to PSAK No.24 4

5 2015 operational summary 2015 OUTPUT TARGET QUARTERLY OUTPUT TREND 2015 Target: 28.7 mt East Kalimantan KITADIN- TD.MAYANG 2.4 Mt Unit: Mt Bharinto Jorong Kitadin INDOMINCO 13.4 Mt Bunyut Port Bontang Coal Terminal Trubaindo Indominco Central Kalimantan TRUBAINDO 7.7 Mt BHARINTO 2.8 Mt Samarinda Balikpapan KITADIN- EMBALUT 1.2 Mt 4Q14 1Q15 2Q15 3Q15 4Q15e 4Q14 1Q15 2Q15 YEARLY OUTPUT TREND Unit: Mt 3Q15 4Q15e Palangkaraya South Kalimantan Bharinto Jorong Kitadin Banjarmasin Trubaindo JORONG 1.2 Mt Indominco Jorong Port e 5

6 Awards and recognition ITM received 1 gold and 4 platinum medals of Gelar Pemberdayaan Masyarakat Berbudaya (GPMB) Award, Jul Awards given by the coordinating Ministry of People s Welfare PT Bharinto Ekatama, one of ITM subsidiaries received Gold Award for Safety & Health Management System, Sep Award was given by The Ministry of Manpower of Republic of Indonesia PT Indominco Mandiri, one of ITM subsidiaries received Gold Level (ADITAMA) for Environmental Management Program from Ministry of Energy and Mineral Resources Republic Indonesia in Sep 2015 ITM won the Gold Award in International Convention on Quality Concept Circle (ICQCC), Oct 2015 at Changwon South Korea 6

7 Introduction Operational review Commercial review Financial review 7

8 Indominco Mandiri SCHEMATIC 2015 target: 13.4Mt West Block ROM stockpile Mine stockyard Santan River km East Block Asphalt haul road 35Km Port stock yard Inland conveyor 4km Operations Ports Hauling Stockpile Crusher Bontang City Sea conveyor 2.5Km Post Panamax 95,000DWT QUARTERLY UPDATES 3Q15 production was lower than target due to high inventory at stockyard area. IPCC project: The system is already in operation and showed improvement in performance. QUARTERLY OUTPUT Unit: Mt E BLOCK W BLOCK E BLOCK W BLOCK Unit: Bcm/t Avg SR: Q14 4Q14 1Q15 2Q15 3Q15 4Q15e Q14 4Q14 1Q15 2Q15 3Q15 4Q15e *SR based on FC coal **SR FY14 IMM: 9.7, WB: 18.9, EB: 8.2 8

9 Trubaindo and Bharinto SCHEMATIC 2015 target: TCM: 7.7Mt BEK: 2.8Mt East Kalimantan PT. Bharinto Operations Barge Port Hauling Stockpile ROM stockpile Bharinto 60km south west of Trubaindo North Block South Block 2 (Biangan) Product coal conveyor, stacking, stockpile South Block 1 (Dayak Besar) Mahakam River Bunyut Port 40km Mine to port North Block Kedangpahu River PT. Trubaindo km QUARTERLY UPDATES Trubaindo: 3Q15 production achieved as according to plan. Bunyut port expansion: New crushing plant and barge loader upgrade already completed. Bharinto: 3Q15 production was slightly lower than target due to lower visibility at hauling road. QUARTERLY OUTPUT Unit: Mt BHARINTO TRUBAINDO Unit: Bcm/t BHARINTO TRUBAINDO Q14 4Q14 1Q15 2Q15 3Q15 4Q15e Q14 4Q14 1Q15 2Q15 3Q15 4Q15e *SR based on FC coal **SR FY14 TCM: 10.0, BEK: 8.9 9

10 Kitadin Embalut and Tandung Mayang SCHEMATIC 2015 target: EMB: 1.2Mt TDM: 2.4Mt Embalut Port East Kalimantan km ROM stockpile Mahakam River Balikpapan IMM WB Embalut Samarinda TD. Mayang IMM EB 5km Mine to port Bontang city to Muara Jawa to Muara Berau Operations Ports Hauling Stockpile Crusher Bontang Port QUARTERLY UPDATES Kitadin Embalut: 3Q15 production achieved as according to plan. Kitadin Tandung Mayang: 3Q15 production achieved as according to plan. Last mining activity was done in Sep 2015 while coal crushing activity will continue until end of 2015, followed by mine closure activities in the beginning of next year. QUARTERLY OUTPUT Unit: Mt TDM EMB Unit: Bcm/t EMB TDM Q14 4Q14 1Q15 2Q15 3Q15 4Q15e Q14 4Q14 1Q15 2Q15 3Q15 4Q15e *SR based on FC coal **SR FY14 EMB: 10.8, TDM:

11 Jorong SCHEMATIC 2015 target: 1.2Mt Pelaihari MAJOR QUARTERLY UPDATES 3Q15 production achieved as according to target. Mine reserves will be fully depleted by mid Mine closure plan is being reviewed by government for approval. Haul road 20km QUARTERLY OUTPUT Unit: Mt Q14 4Q14 1Q15 2Q15 3Q15 4Q15e Operations Barge Port Hauling Stockpile Jorong Coal terminal Pacific Ocean km Unit: Bcm/t Q14 4Q14 1Q15 2Q15 3Q15 4Q15e *SR based on FC coal ***SR FY14 JBG:

12 Introduction Operational review Commercial review Financial review 12

13 Global thermal coal market trends: 2015 vs 2014 SUPPLY TRENDS DEMAND TRENDS Expected significant production cuts due to limited demand, mostly on the off-spec coal, while producers continue to cut costs where possible. China s withdrawal drives Asian demand lower in 2015 but capacity additions boost demand elsewhere. Most buyers have increasing preference for higher quality coals. USA : low gas prices and a potential mild El Niño winter lowers coal demand; no export boom is expected; significant production cuts are required. Colombia : night coal railing ban will be lifted; depreciation of local currency and low costs improve competitive position South Africa : depreciation of local currency improved competitiveness; continued political and social issues; limited rail capacity; uncertain expansion Russia : export to Europe fell due to limitation on demand side; weak ruble and infrastructure developments will help boost exports to Asia in the medium term Indonesia : considerable falls in lower-cv coal exports to China; slow domestic demand growth increases the availability of coal for export; huge oversupply on LCV coal; significant production cuts is expected Global Indonesia Australia Colombia Russia S.Africa +2 Mt +5 Mt +2 Mt USA -55 Mt Others Global China* India : import demand is likely to be flat this year due to slow economic growth and improved domestic coal production while infrastructure constraint remains India +0 Mt +1 Mt -5 Mt -64 Mt Other : growing demand from the power sector in Brazil offset by weaker import demand from the US and Chile Australia : existing spare capacity and the completion of projects in the near term will lead to continued growth in exports; take-or-pay continues to force producers to export more coal, currency depreciation assists China : weak demand; declining domestic coal prices; intense competition; coal industry reform; ultralow emissions for coastal plants will keep coal imports in the mix. Europe : low gas price; gas-switching; increased renewable energy and coal-fired capacity closures will reduce coal burn Other N.Asia Other Asia : capacity additions in South Korea and several emerging markets boost coal demand in Asia Europe Others +10 Mt +6 Mt -10 Mt -14 Mt -64 Mt -69 Mt Note: *include anthracite and lignite 13

14 China thermal coal market review CHINA COMMENTS CHINA THERMAL COAL IMPORTS/EXPORTS* Unit: Mt F Sources: Banpu MS&L Estimates CHINA ANNUALIZED ACTUAL IMPORT 1Q13-2Q15* Unit: Mt Import Export Slowed economy and mild weather has lower power demand. Oversupply depressed coal market caused by weakening demand and intense competition. RMB devaluation to help domestic miners but impact has been limited. Traders face difficulties in L/C opening due to an increase in margin requirements Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 CHINA DOMESTIC COAL PRICES Unit: RMB/t 1, Apr-12 Jun-12 Aug-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 > 5,800 kcal/kg > 5,500 kcal/kg > 5,000 kcal/kg Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Apr-15 Jun-15 Import Export Aug Price cuts by Chinese producers increased downward pressure on Pacific market coal prices. Government tries to accelerate coal industry reform may allow some state-owned enterprises (SOE) to go bankrupt. Continued push of ultra-low emissions for coastal plants would mean imports remain in the mix. Source: 14 October 2015 Note: *include anthracite and lignite imports/exports 14

15 India thermal coal market review INDIA INDIA THERMAL COAL IMPORTS* Unit: Mt F Sources:: Salva Report India, ITM MS&L Estimates INDIA ANNUALIZED ACTUAL IMPORT 1Q13-3Q15 Unit: Mt COMMENTS Lower rainfall and weak hydro lifts coal-fired power generation. Coal stocks are coming down quickly. Coal India Limited (CIL) coal production continues to improve slowly and still lags behind target levels. - Dispatch of coal to market still question due to infrastructure constraint. Production gains from CIL are being offset by reductions at captive mines which have been largely idle since license cancellations from Aug/Sep India commissioned 12 GW of coal-fired power capacity this year which equates to 50Mt new coal demand, and can easily absorb production growth achieved by CIL. Financial distress of distributors caps expansion options. Credit issue remains several buyers were looking to buy on credit amid a lack of cash. 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 Note: *includes lignite grade imports (approximately 25% - 30%) 15

16 ASP vs thermal coal benchmark prices ITM ASP VS BENCHMARK PRICES COMMENTS Unit: $/t Monthly NEX Quarterly ITM ASP ITM ASP slightly eased due to general market weakness 3Q15 ASP was 2% down Q-o-Q NEX benchmark prices remain weak. 0 Jan-07 Aug-07 Mar-08 Oct-08 May-09 Dec-09 Jul-10 Feb-11 Sep-11 Apr-12 Nov-12 Jun-13 Jan-14 Aug-14 Mar-15 Oct-15 ITM ASP 3Q15 NEX* Nov 05, 2015 $55.9/ton $52.1/ton *The Newcastle Export Index (previously known as the Barlow Jonker Index BJI) 16

17 ITM coal sales 9M15 COAL SALES BREAKDOWN BY DESTINATION COAL SALES 9M15 ITALY 0.7 Mt INDIA 4.1 Mt THAILAND 2.2 Mt CHINA 3.6 Mt HK 0.2 Mt KOREA 0.8 Mt 1.5 TAIWAN 0.7 Mt JAPAN 3.7 Mt PHILIPPINES 1.5 Mt USA 0.4 Mt Philippines Thailand Taiwan Korea 10% Indonesia Malaysia Hong Kong USA Italy 1% 7% 3% 3%2% 5% 13% 17% 20% India 17% China MALAYSIA 0.2 Mt Japan OTHERS 0.1 Mt INDONESIA 2.8 Mt Total Coal Sales 9M15: 20.9 Mt 17

18 Indicative coal sales 2015 COAL SALES CONTRACT AND PRICING STATUS Contract Status Price Status Indexed Contracted 3% 100% Fixed 97% TARGET SALES 2015: 28.7 Mt 18

19 Introduction Operational review Commercial review Financial review 19

20 Sales revenue USD million % QoQ -27% YoY Jorong -28% (QoQ) ; -44% (YoY) Kitadin -25% (QoQ) ; -26% (YoY) Bharinto +8% (QoQ) ; -11% (YoY) Jorong Trubaindo -7% (QoQ) ; -25% (YoY) Kitadin Bharinto Trubaindo Indominco Indominco -1% (QoQ) ; -31%(YoY) ASP 3Q15 : $55.9 /ton 2Q15 : $57.2 /ton 3Q14 : $67.1 /ton 9M15 : $57.9 /ton 9M14 : $68.7 /ton 3Q14* 2Q15 3Q15 Note : Total consolidated revenue after elimination *) Restated due to PSAK No.24 20

21 Average gross margin Units: US$M Revenue GPM** (%) % 43 11% 11% 39% 20% 28% 19% 28% % 30% 21% 16% 20% 10% 29% 24% 27% 3Q14* 2Q15 3Q15 3Q14* 2Q15 3Q15 3Q14* 2Q15 3Q15 3Q14* 2Q15 3Q15 3Q14* 2Q15 3Q15 Indominco Trubaindo Bharinto Kitadin Jorong 18% 19% 23% 3Q14* 2Q15 3Q15 ITM Consolidated *) Restated due to PSAK No.24 **) Gross profit after royalty expense 21

22 Cost WEIGHTED AVERAGE STRIP RATIO COST OF GOODS SOLD Unit: Bcm/t Avg. FY14: 10.0 Avg.9M15: Unit: US$/t Avg. FY14: $52.9/t Avg. 9M15: $45.4/t Q14 4Q14 1Q15 2Q15 3Q15 3Q14 4Q14 1Q15 2Q15 3Q15 FUEL PRICE TOTAL COST* Unit: US$/Ltr Avg. FY14: $1.02/ltr Avg. 9M15: $0.57/ltr Unit: US$/t Avg. FY14: $58.8/t Avg. 9M15: $50.9/t Q14 4Q14 1Q15 2Q15 3Q15 3Q14 4Q14 1Q15 2Q15 3Q15 * Cost of Goods Sold + Royalty + SG&A 22

23 EBITDA USD million +18% QoQ -2% YoY Jorong -50% (QoQ) ; -67% (YoY) Kitadin -8% (QoQ) ; +140% (YoY) Bharinto +50% (QoQ) ; -25% (YoY) Trubaindo +56% (QoQ) ; +25% (YoY) Jorong Kitadin Bharinto Trubaindo Indominco -5% (QoQ) ; -28%(YoY) Indominco 3Q14* 2Q15 3Q15 *) Restated due to PSAK No.24 23

24 Net income USD million +23% QoQ +19% YoY Jorong -90% (QoQ) ; -50% (YoY) Kitadin -14% (QoQ) ; +500% (YoY) Bharinto -33% (QoQ) ; -50% (YoY) 3 Jorong Kitadin Bharinto Trubaindo Indominco Trubaindo +56% (QoQ) ; +17% (YoY) Indominco +100% (QoQ) ; +20%(YoY) 3Q14* 2Q15 3Q15 *) Restated due to PSAK No.24 24

25 Balance sheet KEY RATIOS CASH POSITION Net Gearing (%) 612 Unit: US$M Net D/E (times) (57%) (46%) (32%) (26%) (38%) (0.57) (0.46) (0.32) 2013 (0.26) 2014 (0.38) 3Q DEBT POSITION Q15 Unit: US$M Q15 25

26 2015 capital expenditure plan Units: USD million Indominco Trubaindo Bharinto Realized up to Sep 15 Kitadin Capex plan Jorong ITM Consolidated Note: Total capex plan including Jakarta office and PT. TRUST (Mining Contractor Business) after elimination 26

27 Dividend Dividend payout (%) Dividend per share (Rp) 10% div yield 90% 9% div yield 80% 10% div yield 60% 50% % div yield 88% 67% 50% 1, % div yield 75% 75% % 1,168 2,506 1,666 90% 1,464 9% div yield 11% div yield 70% 80% 90% 108% 1, , % div yield 100% 752 1H08 3Q08 4Q08 1H09 2H09 1H10 2H10 1H11 2H11 1H08 3Q08 4Q08 1H09 2H09 1H10 2H10 1H11 2H11 1H12 1H12 1H13 2H13 1H14 2H14 1H15 Rp 1,345 /s Rp 1,964/s ( 60% payout ) ( 70% payout ) Rp 1,202/s Rp 3,674/s ( 75% payout ) ( 85% payout ) 1H12 2H12 1H13 2H13 1H14 2H14 Rp 3,130/s Rp 1,989/s Rp 1,745/s ( 85% payout ) ( 85% payout ) ( 80% payout ) 1H15 * 1H15 dividend payment was paid on 26 Oct

28 Thank you Question & Answer 28

29 Appendices 29

30 ITM structure Banpu Banpu PCL 99.99% Banpu Coal Investment Co.Ltd INDONESIAN STOCK EXCHANGE IPO 18 th Dec % BCI Public 50.00% 34.94% BMC 50.00% BMS 65.06% ITMG Banpu Minerals Co.Ltd Banpu Minerals (Singapore) Pte Ltd PT Indo Tambangraya Megah Tbk % 99.99% 99.00% 99.99% 99.99% Indominco Trubaindo Bharinto Kitadin PT Indominco Mandiri (CCOW Gen I) PT Trubaindo Coal Mining (CCOW Gen II) Exp: Oct 2030 Exp: Feb 2035 PT Bharinto Ekatama (CCOW Gen III) PT Kitadin- Embalut (IUP) PT Kitadin- Td.Mayang (IUP) PT Jorong Barutama Greston (CCOW Gen II) Exp: May 2035 East Kalimantan East Kalimantan East / East Kalimantan East Kalimantan South Kalimantan Central Kalimantan Output 9M15: 10.2 Mt 5.6 Mt 2.0 Mt 0.9 Mt 1.9 Mt 1.0 Mt Reserves 78 Mt Resources 720 Mt 47 Mt 390 Mt Exp: Jun 2041 Exp: Feb Mt 216 Mt 5 Mt 146 Mt Exp: May Mt 5 Mt Jorong 2 Mt 140 Mt 99.99% ITMI PT ITM Indonesia Coal Trading Jakarta Office 99.99% TRUST PT Tambang Raya Usaha Tama Mining Services Jakarta Office 99.99% IBU PT ITM Batubara Utama Coal Investment Jakarta Office 99.99% IEU PT ITM Energi Utama Power Investment Jakarta Office 6,000-6,300 kcal/kg 6,500-7,300 kcal/kg 6,400-6,800 kcal/kg 5,800 kcal/kg 6,700 kcal/kg 5,300 kcal/kg Note: Updated Coal Resources and Reserves as of 31 Dec 2014 based on estimates prepared by Competent Persons (consider suitably experienced under the JORC Code) in 30 Apr 2015 and deducted from coal sales volume in 9M15. 30

31 Income statement Unit: US$ thousand 2Q15 3Q15 3Q14* QoQ% Y oy% Net Sales 396, , ,426-4% -27 % Gross Profit 7 5,239 85,553 92, % -7 % GPM 19% 22% 18% SG&A (37,499) (36,200) (43,97 1) -3% -1 8% EBIT 37, ,353 48,198 31% 2% EBIT Margin 10% 13% 9% EBIT DA 55,009 64,512 65, % -2% EBIT DA Margin 14% 17 % 13% Net Interest Income / (Ex penses) ,27 6-5% -29% Derivative Gain / (Loss) (10,412) (6,116) (14,616) -41% -58% Others 2,509 (5,583) % % Profit Before T ax 30,607 38, , % 15% Income Tax (1 0,366) (1 3,825) (1 2,7 88) 33% 8% Net Incom e 20,241 24,914 21,018 23% 19% Net Incom e Margin 5% 7 % 4% *) Restated due to PSAK No.24 31

32 Income statement Unit: US$ thousand 9M14* 9M15 Y oy% Net Sales 1,487,613 1,206,550-19% Gross Profit 315, , % GPM 21% 22% SG&A (122,499) (113,417 ) EBIT 193, ,380-24% EBIT Margin 13% 12% EBIT DA 244, , % EBIT DA Margin 16% 16% Net Interest Income / (Ex penses) 4,1 60 2,845 Derivativ e Gain / (Loss) 30,325 (14,37 5) Others 4,383 (3,7 29) Profit Before T ax 232, ,121-44% Income Tax (62,803) (48,1 7 3) Net Incom e 169,412 82,948-51% Net Incom e Margin 11% 7 % *) Restated due to PSAK No.24 32