Cement companies in Indonesia

Transcription

1 - April

2 Cement companies in Indonesia Domestic Capacity (2017) 2017F Design Capacity : mt Production Capacity: 74.0 mit Domestic Growth : 5.0% Domestic Utilization: 70% Supply Domestic : 69 mt Export : 5 mt Import : 3 mt 1. Semen Indonesia 35.5 mt 2. Indocement TP 24.9 mt 3. Lafarge Holcim Indonesia 14.5 mt 4. Semen Merah Putih 7.5 mt 5. Semen Bosowa 7.0 mt 6. Semen Anhui Conch 4.5 mt 7. Semen Baturaja 3.8 mt 8. Semen Pan Asia 1.9 mt 9. Siam Cement Group 1.8 mt 10. Semen Jui Shin 1.5 mt 11. Semen Serang (Haohan) 1.2 mt 12. Semen Jakarta 1.0 mt 13. Semen Hippo (Sun Fook) 0.6 mt 14. Semen Kupang 0.3 mt 15. Semen Puger 0.3 mt TOTAL 2 106,3 mio ton *) Source: SMGR intemal calculation

3 Opportunity Regional Cement Market 3

4 Semen Indonesia sales volume Million tonnes Feb-17 Feb-16 Change (%) 2M17 2M16 Change (%) Indonesia Semen Indonesia % % Semen Padang % % Semen Tonasa % % Total domestic % % Exports % % Total volume from Indonesia % % Vietnam Domestic Vietnam % % Exports % % Total volume from Vietnam % % Total volume % % Source: Company data, Indonesia Cement Association 4

5 Indonesia cement sales volume SMGR sales volume (million tons) Feb-17 Feb-16 Change (%) 2M17 2M16 Change (%) Domestic Semen Indonesia % Semen Padang % (10.6) Semen Tonasa % Total domestic % Export % Total volume % Market share 42.1% 39.9% 2.2% 41.5% 40.4% 1.2% Semen Indonesia: Bag 77.2% (+1.7% YoY) Bulk 22.8% (+2.2% YoY) Industry: Bag 77.4% (-2.0% YoY) Bulk 22.6% (+2.4% YoY) Indonesia domestic sales volume (million tons) Area Feb-17 Feb-16 Change (%) 2M17 2M16 Change (%) Jakarta (6.1) (6.9) Banten (0.7) (7.6) West Java (2.0) Central Java Yogyakarta East Java Total Java Sumatera (5.1) (5.8) Kalimantan (8.4) (11.3) Sulawesi (12.7) (6.3) Nusa Tenggara Maluku & Papua (5.9) Total outside Java (4.7) (4.6) Total Indonesia (1.0) Export Cement , Clinker (89.6) Total export Grand total Source: Company data, Indonesia Cement Association 5

6 Domestic market consumption ± Bulk 22.6% Ready-mix (infrastructure): ± 60% Fabricator (pre-cast, fiber cement, cement based industry): ± 35% Projects (mortar, render): ± 5% ± Bag 77.4% Housing: ± 90% Cement based industry: ± 10% Source: Internal Research Retail (residential) sector is the largest consumer of cement in Indonesia 6

7 Market by Geography National cement distribution Semen Indonesia market destinations Source: Company data, Central Bureau of Statistics, Indonesia Cement Association Population distribution Domestic Market Share 7

8 Current overcapacity condition Source: Internal Research, Indonesia Cement Association 8

9 Long-term demand growth 6% pa Source: Company data, Indonesian Cement Association & BPS Statistic 9

10 Key Factors Supporting Domestic Cement Consumption INFRASTRUCTURE DEVELOPMENT Infrastructure Spending Planned for (USD Bn) Central Govt Regional Govt 106 COMMERCIAL & INDUSTRIAL High growth in retail, commercial and SOEs Private Total institutional sector in urban and semi-urban area High growth industry segment (precast, light brick, cement fiber, pave, ready mixed concrete) POTENTIAL MARKET The fourth largest population in the world: 240 millions people (2014) HOUSING Population Growth Rising per Capita Income Mass urbanization CEMENT CONSUMPTION 2016 (KG/CAPITA) DEMOGRAPHIC BONUS Cement Consumption per Capita (kg) average (ex china) = 459kg Rapidly Growing Productive Population

11 Strategic Projects Strategic Projects Capacity Investment (US$mn) Construction Start up commercial Start Completion Indarung VI- Sumatera Barat 3.0 Mt 352 Q Q April 17 Rembang Jawa Tengah 3.0 Mt 403 Q Q Mid 17 Grinding mill Jawa Barat 2.0 Mt 61.1 Q Q Q17 Waste Heat Recovery Power Generation 30.6 MW 49.3 Q Q Q17 These strategic projects are to ensure the Company position as the market leader. 11

12 Our facilities Kiln Cement Mill Grinding Plant 1 unit 1 unit 1 unit Cement Mill Integrated Cement Plant Kiln Cement Mill Grinding Plant Cement Mill Warehouse Packing Plant Sea Port 4 location 15 Unit 26 Unit 2 location 4 Unit 30 location 24 location 12 location Kiln Cement Mill 5 unit 8 unit Kiln Cement Mill 5 unit 11 unit Grinding Plant 3 unit Cement Mill Kiln 4 unit Cement Mill 6 unit 12

13 Financial Summary FY 2016 In Rpbn Change Revenue 26,134 26, % Cost revenue 16,278 16, % Gross profit 9,856 10, % Operating expenses 4,629 4, % Operating income 5,227 5, % EBITDA 6,962 7, % Pre-tax profit 5,085 5, % Net profit after minority 4,522 4, % EPS (Rp) % Ratio EBITDA margin 26.6% 27.7% -1.1% Gross margin 38% 40% -2% Interest coverage - x (1) Cost ratio 80% 78% 2% Net debt to equity % Debt to equity % Debt to EBITDA % Receivable turnover - days EBITDA Net profit 13

14 Balance Sheet Cash balance (Rpbn) Debt/EBITDA (x) Total debt (Rpbn) Net Debt/Equity 14

15 Margin & Returns Return on Equity (%) EBITDA/t (US$/t) Return on Assets (%) Receivables Turnover (days) 15

16 Cost structure Rp000/t Raw materials Fuel Electricity Labor Maintenance Depreciation GA,tax,insurance Packaging Transportation Others Cost of goods sold Unit cash COGS (US$/t) Selling expense G&A Total cost Change 35-6% % 101-6% 49 8% 50 0% 47 14% 20 10% 27 3% 82-24% 50 34% 568-2% 520-3% 93 1% 73 2% 733-1% Cash COGS Rp000/t Energy prices in US$/unit 16

17 EBITDA margin vs utilisation rate Source: Company data 17

18 EBITDA margin vs oil and coal prices Source: Company data 18

19 Development New Industrial Estates is a catalyst for cement demand Semen Indonesia Packing Plant New Industrial Estate Area 19

20 Infrastructure Projects ( ) Sector Amount % of total (Rptn) Road infrastructure % Railway infrastructure 226 5% Sea transportation % Air transportation 144 3% Land transportation 47 1% Urban transportation 86 2% Electricity infrastructure 1,000 21% Oil & gas infrastructure % Telecommunication and Information infrastructure 280 6% Water resources 451 9% Drinking and waste water 403 8% Housing 328 7% Total 4, % Annual spending % APBN-P ,083 APBN-P for infrastructure % Private portion % Source: Bappenas If 1% from total project value were spent for cement, we estimate cement requirement for these projects of around mt per annum. Infrastructure budget cut Rp7tn for 2016, but not affecting main trans road in Papua and Java. 20

21 Infrastructure Spending in State Budget Amount in Rp trillion APBN APBN-P APBN APBN-P Economic infrastructure Ministrial spending Ministry of Public Work and Public Housing Ministry of Transportation Ministry of Agriculture Ministry of Energy and Mineral Resoures Non-ministrial spending Transfer to Region and Village Fund Payment Funding Social infrastructure Infrastructure support Ministry of Agrarian & Spatial Planning Ministry of Industry Total Source: Ministry of Finance 21

22 Instrastructure funding is priority The infrastructure is the government priority Gets funding priority despite tax revenue not achieving target Key risks are more on the project risks such as land acquisition. Increasing government debt to around US$137bn by end of 2015 Government s securities also increased to around Rp1.37tn by end of

23 Semen Indonesia highlights 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: Government of Republic of Indonesia: 73% Public: 27% 1995 : Acquisition of PT Semen Padang (Persero) and PT Semen Tonasa (Persero) 1998 : Cemex became a strategic partner, Market Cap.: IDR4.9tn 2006 : Blue Valley Holdings bought Cemex s 24.9% stake in SMGR, Market Cap.: IDR21.5tn 2010 : In March 31, Blue Valley Holdings sold all of its stake ownership in SMGR, Market Cap per April 30, 2010: IDR72.1tn 2011 : Total installed capacity of 20.00mm tons, Market Cap per June 29, 2012: IDR67.0tn 2012 : Acquisition of Thang Long Cement Vietnam, Total installed capacity of 2.3mm tons, Market Cap Dec 19 th, 2012: IDR91.9tn 2013: Transformed to PT Semen Indonesia (Persero) Tbk as strategic holding co. SMGR CAPACITY BUILD-OUT (MM TONS) 35,0 30,0 25,0 20,0 15,0 10,0 5,0 0, ,8 mn tons 23

24 Semen Indonesia as strategic holding company Komposisi Pemegang Saham Per 31 Desember 2016 SG 99,9% SP ST TLCC 50,0% 99,9% 99,9% 70,0% 55,0% PT Krakatau Semen Indonesia PT United Tractors Semen Gresik CEMENT COMPANY 97,0% PT SGG Energi Prima No Shareholders % 1 Government RI Foreign Institution Foreign Individual 0.03 NON CEMENT COMPANY 60,0% 65,0% 99,99% 73,65% PT Industri Kemasan Semen Gresik PT Kawasan Industri Gresik PT SI Beton PT Varia Usaha 25% PT Swadaya Graha 4 Domestic Institution Domestic Individual ,6% 85% 24 85% PT Eternit Gresik PT SISI PT SII

25 Thank You IMPORTANT NOTICE THIS PRESENTATION IS NOT AND DOES NOT CONSTITUTE OR FORM PART OF, AND IS NOT MADE IN CONNECTION WITH, ANY OFFER FOR SALE OR SUBSCRIPTION OF OR SOLICITATION, RECOMMENDATION OR INVITATION OF ANY OFFER TO BUY OR SUBSCRIBE FOR ANY SECURITIES NOR SHALL IT OR ANY PART OF IT FORM THE BASIS OF OR BE RELIED ON IN CONNECTION WITH ANY CONTRACT, COMMITMENT OR INVESTMENT DECISION WHATSOEVER. THE SLIDES USED IN THIS PRESENTATION ARE STRICTLY CONFIDENTIAL AND HAVE BEEN PREPARED AS A SUPPORT FOR ORAL DISCUSSIONS ONLY. THE INFORMATION CONTAINED IN THIS PRESENTATION IS BEING PRESENTED TO YOU SOLELY FOR YOUR INFORMATION AND MAY NOT BE REPRODUCED OR REDISTRIBUTED TO ANY OTHER PERSON, IN WHOLE OR IN PART. This presentation includes forward-looking statements, which are based on current expectations and forecast about future events. Such statements involve known / unknown risks uncertainties and other factors, which could cause actual results to differ materially from historical results or those anticipated. Such factors include, among others: economic, social and political conditions in Indonesia, and the impact such conditions have on construction and infrastructure spending in Indonesia; the effects of competition; the effects of changes in laws, regulations, taxation or accounting standards or practices; acquisitions, divestitures and various business opportunities that we may pursue; changes or volatility in inflation, interest rates and foreign exchange rates; accidents, natural disasters or outbreaks of infectious diseases, such as avian influenza, in our markets; labor unrest or other similar situations; and the outcome of pending or threatened litigation. We can give no assurance that our expectations will be attained. DISCLAIMER The information contained in this report has been taken from sources which we deem reliable. However, none of PT Semen 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. 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 misstatements, negligent or otherwise, in the report and any liability in respect of the report or any inaccuracy therein or omission therefrom which might otherwise arise is hereby expresses disclaimed. Main Office: Main Building of Semen Gresik Jln. Veteran Gresik Indonesia Phone: (62-31) , Fax: (62-31) , Representative Office: The East Building, 18 floor Jl. Lingkar Mega Kuningan Blok E 3.2 No. 1, JAKARTA Telp.: , ; Faks :