SMGR CORP Presentation Jan 2015

(1)

Together We Build a Better Future

0

(2)

INDONESIA’S CEMENT INDUSTRY: NOW and THE FUTURE

SMGR Corporate Presentation

JANUARY 2015

INDONESIA’S CEMENT INDUSTRY: NOW and THE FUTURE

(3)

Singapore Kuala

Lumpur

22

11 CEMENT INDUSTRY AT A GLANCE

SMGR

• Design Capacity

: 68.0 mio tons

71.5 mio tons

• Production Capacity : 55.2 mio tons

60.0 mio tons

• Domestic Growth

: 5.5%

6.0%

• Domestic Utilization : 100%

100%

CEMENT INDUSTRY

2013

2014F

1)

• Domestic Utilization : 100%

100%

• Supply



Domestic

: 58.0 mio tons

61.0 mio tons



Export

: 0.5 mio tons

0.5 mio tons



Import

: 3.3 mio tons

2)

3.0 mio tons

3)

1) Based on the Company’s forecast

2) Imported cement by PT Semen Andalas (1.0 mio ton) and clinker by Bosawa and

3) Imported cement & clinker

CEMENT INDUSTRY AT A GLANCE

1

66

77 1. SEMEN INDONESIA

29.5 mn ton

- Semen Padang :

7.3 mn ton

- Semen Gresik :

14.4 mn ton

- Semen Tonasa:

7.8 mn ton

82.2 mio tons

69.8 mio tons

6.0%

94%

DOMESTIC CAPACITY (2014

)

2015F

1)

2 - Semen Tonasa:

7.8 mn ton

2. Semen Andalas

2)

_{1.6 mn ton}

3. Semen Baturaja

1.3 mn ton

4. Indocement TP

20.5 mn ton

5. Holcim Indonesia

12.1 mn ton

6. Semen Bosowa

6.0 mn ton

7. Semen Kupang

0.5 mn ton

TOTAL

71.5 mn ton

94%

65.8 mio tons

0.5 mio tons

)

_{3.0 mio tons}

3)

(4)

New Cement Capacity from Existing Players (2013 – 2017)

No

Company

Targeted Plant

Location

Declared Capacity

(mn tons)

Prognose

(mn tons)

1 Semen

_Indonesia

Java, Sumatera,

_Sulawesi

11.5

2 Indocement

Java, Kalimantan

8.8

3 Holcim

East Java

3.8 ADDITIONAL INSTALLED CAPACITY IN THE NEXT 5 YEARS

New Cement Capacity from Potential Players (2013 – 2017)

No

Company

Targeted Plant

Location

Declared Capacity

(mn tons)

1 Siam Cement (Thailand)

Sukabumi, West Java

1.8

2 CNBM (China)

Central Java

2.4

3 Semen Merah Putih

Bayah, Lebak, Banten

11.5

4 Anhui Conch Cement

Various

13.7

4 Bosowa

Java, Sulawesi

7.9

5 Semen Andalas

Sumatera

1.6

6 Semen Baturaja

Sumatera

2.6 T O T A L

36.2

4 Anhui Conch Cement

- Tanjung

- Tanah Grogot

- Pontianak

- West Papua

Various

- South Kalimantan

- East Kalimantan

- West Kalimantan

- West Papua

13.7

3.8

2.4

5 Ultratech

Wonogiri, Centr Java

4.5

6 Semen Puger

East Java

0.6

7 Semen Barru

Barru, South Sulawesi

3.3

8 Semen Panasia

Ajibarang, Central Java

2.0

9 Jui Shin Indonesia

Karawang, West Java

1.5 T O T A L

40.3 Prognose Design Capacity

(mn tons)

Investment

(US$ mn)

Remarks

9.0

970 Upgrading +

_{green/brownfield}

6.3 1,560 (E)

Cement Mill +

_{brown/greenfield}

3.4 680 (E)

Brown/Greenfield

ADDITIONAL INSTALLED CAPACITY IN THE NEXT 5 YEARS

Declared Capacity

Prognose Design

Capacity (mn tons)

Investment

(US$ mn)

Remarks + Local Partner

1.8 (2016)

360 Greenfield

0

350 Greenfield, Semen Grobogan

3.0 (2016)

600 Greenfield (PT Cemindo Gemilg)

2,350

Greenfield

3.4

620 Cement

Mill + Brownfield

0

300 Greenfield

1.5

325 Greenfield/Brownfield

23.6 4,130

0

827 Greenfield

0 n.a

Upgrading

0

470 Greenfield (Fajar Group)

1.5 (2016)

240 Greenfield

1.5 (2015)

n.a

Greenfield

(5)

kg

1.600

1.800 kg/capita

COMPARISON: CEMENT CONSUMPTION PER CAPITA 201

200

400

600

800

1.000

1.200

1.400

Source: Deutsche, Indonesia Cement Association

0

200 Ch

ina

Sin

_gap

ore

Ma

lay

sia

Vie

tna

_m

kg/capita

COMPARISON: CEMENT CONSUMPTION PER CAPITA 2013

229 Vie

tna

_m

Tha

_ilan

d

Ind

one

_sia

Phil

ipp

ine

_s

(6)

INDONESIA’S ECONOMY AND DOMESTIC CEMENT CONSUMPTION GROWTH

Domestic consumption (LHS)

GDP growth % (RHS)

(mio tons)

50.0

60.0 Cement growth % (RHS)

Growth

Source: Indonesian Cement Association & BPS Statistic

1.1%

9.7%

5.8%

1.1%

1.8%

0.0 2002

2003

2004

2005

2006

2007

2008

AND DOMESTIC CEMENT CONSUMPTION GROWTH

GDP growth % (RHS)

48.0 Cement growth % (RHS)

Growth

2008

2009

2010

2011

2012

2013

2014

(7)

ARISING INFRASTRUCTURE EXPANSION

Bag and Bulk cement consumption (million tons)

40

45

21.0

18.1

16.9

20.0 22.7 23.7 23.7

25.2 25.5

10

15

20

25

30

35

6.5

1.0

1.9

2.3

3.0

3.5

3.8

5.0

6.0

0

5

10 1997 1998 1999 2000 2001 2002 2003 2004 2005

Bagged Cement

INFRASTRUCTURE EXPANSION TREND

Bag and Bulk cement consumption (million tons)

39.2 44.1 45.7 46.9

26.9

28.2

32.2

32.8

34.2

8.8 10.8 12.2

13

6.0

5.1

6.0

5.9

6.2

6.6

8.8 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

(8)

Bulk

22%

• Ready

• Fabricator (pre

•

• Ready

• Fabricator (pre

• ±

DOMESTIC MARKET CONSUMPTION

Bag

78%

Key Drivers of Domestic cement demand:

• Projects (mortar, render):

• Housing:

• Cement based industry:

• Housing:

• Cement based industry:

±

Retail (residential) sector is the largest

consumer of cement in Indonesia

Key Drivers of Domestic cement demand:

• National Economic Growth

• Favorable Interest Rate Environment

• Infrastructure Expansion

• Per Capita Consumption

current low levels

Source: Internal Research

Ready-mix (infrastructure):

±

60%

Fabricator (pre-cast, fiber cement, cement based industry):

±

35%

Ready-mix (infrastructure):

±

60%

Fabricator (pre-cast, fiber cement, cement based industry):

±

35%

DOMESTIC MARKET CONSUMPTION (2014)

Key Drivers of Domestic cement demand:

Projects (mortar, render):

±

5%

Projects (mortar, render):

±

5%

Housing:

±

90%

Cement based industry:

±

10%

Housing:

±

90%

Cement based industry:

±

10%

Key Drivers of Domestic cement demand:

National Economic Growth

Favorable Interest Rate Environment

Infrastructure Expansion

(9)

DOMESTIC

SMGR Corporate Presentation

JANUARY 2015

DOMESTIC MARKET UPDATE

(10)



REGION

MARKET SHARE (%)

SMGR

INTP

SMCB

1. JAVA

40.4

38.8

18.3 Domestic Market Share (FY2014

1. JAVA

40.4

38.8

18.3 2. SUMATERA

42.9

14.1

14.7 3. KALIMANTAN

50.2

29.6

11.1 4. SULAWESI

63.1

13.3

0.9 5. NUSA TENGGR.

38.8

33.3

5.4 6. EASTERN IND.

56.7

20.8

0.7 TOTAL

INDONESIA

43.7

30.3

14. MARKET BY GEOGRAPHY

Papua

Bali & N T

Sulawesi

Population Distribution (2013)

8.4%

5.8%

5.5% 1.5%

5.6% 2.1%

Cement Distribution (FY2014)

Sulawesi

Kalimantan

Sumatera

21.3%

Java

57.5.%

5.8%

MARKET SHARE (%)

SMCB BSWA ANDLS BTRJA

KPG

(11)

MARKET UPDATE - Cement Consumption

DESCRIPTION

FY-13

FY-14

CHANGE (%)

DOMESTIC

25,449,714

26,155,918

2.8 Semen Indonesia

13,239,252

13,993,231

5.7 Semen Padang

6,927,490

6,742,831

(2.7)

FY 2014 - SMGR Sales Volume

(million tons)

Semen Padang

6,927,490

6,742,831

(2.7)

Semen Tonasa

5,282,971

5,419,856

2.6 EXPORT

328,756

197,284

(40.0)

GRAND TOTAL

25,778,470

26,353,202

2.2 SMGR Sales Type (mio tons)

FY-13

FY-14

YoY Change

Bag

19.4 (76.4%)

19.6 (76.0%)

2.3

*) Source: Indonesia Cement Association, un-audited figures *) Source: Indonesia Cement Association, un-audited figures

Industry Sales Type (mio tons)

FY-13

FY-14

YoY Change

Bag

45.7 (78.8%)

46.8 (78.2%)

2.5 Bulk

12.2 (21.2%)

13.0 (21.8%)

6.0 Bag

19.4 (76.4%)

19.6 (76.0%)

2.3 Bulk

6.0 (23.6%)

6.2 (24.0%)

4.1 Cement Consumption FY2014

AREA

FY 2013

FY 2014

CHANGE (%)

Jakarta

5,379,767

5,782,219

7.5 Banten

3,474,592

3,204,137

(7.8)

West Java

8,615,161

8,842,494

2.6 FY 2014 – Domestic Consumption

(mio tons)

Central Java

6,848,260

6,907,373

0.9 Yogyakarta

986,157

998,579

1.3 East Java

7,400,367

7,997,366

8.1 Total Java

32,704,304

33,732,168

3.1 Sumatera

12,182,616

12,492,536

2.5 Kalimantan

4,387,998

4,546,679

3.6 Sulawesi

4,273,766

4,527,956

5.9 Nusa Tenggara

3,255,259

3,335,787

2.5 Maluku & Papua

YoY Change

Maluku & Papua

1,201,093

1,274,374

6.1 TOTAL

INDONESIA

58,005,037

59,909,500

3.3 Export Cement

178,418

220,284

23.5 Export Clinker

396,934

44,878

(88.7)

Total Export

575,352

265,162

(53.9)

(12)

SMGR Corporate Presentation

JANUARY 2015

COMPANY PROFILE

(13)



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

1998 : Cemex became a strategic partner, Market Cap.: IDR4.9tn

BRIEF HISTORY

SMGR IS THE #1 CEMENT COMPANY IN INDONESIA



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

20,0

25,0

30,0

SMGR CAPACITY BUILD-OUT (Mio TONS)

Post-consolidated capacity

Inauguration of Gresik I, installed capacity of 250,000 ton cement per annum

Initial Public Offering, Market Cap.: IDR0.63tn, resulting shareholding structure post IPO:

) and PT Semen Tonasa (Persero)

became a strategic partner, Market Cap.: IDR4.9tn

SMGR IS THE #1 CEMENT COMPANY IN INDONESIA

became a strategic partner, Market Cap.: IDR4.9tn

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

otal installed capacity of 2.3mm tons, Market Cap Dec 19

th

_{, 2012: IDR91.9tn}

consolidated capacity

• Total Installed capacity: 30 million

tons (2013) including TLCC;

• Market share of Semen Indonesia in

200

6

200

7

200

8

200

9

201

0

201

1

201

2

201

3 _

• Market share of Semen Indonesia in

2013 was 44% based on sales volume

• 2013 Revenues amounted to IDR 19.6

(14)

The Government of the Republic of Indonesia

OWNERSHIP STRUCTURE

1

OWNERSHIP STRUCTURE

1

51.01%

PT Semen Indonesia (

PT Semen Padang

99.99%

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%

Name

PT Semen Gresik

¹ As of Jan, 2014

4. SUPS

Cement Packaging

10.00%

3.

4. FOCUS IN CORE BUSINESS

PT Semen Indonesia (Persero) Tbk.

PT Semen Tonasa

99.99%

Name

Activities

% Ownership

UTSG

Limestone & Clay Mining

55.00%

IKSG

Cement Packaging

60.00%

KIG

Industrial Estate

Thang Long Cement, VN

70.00%

Name

Activities

% Ownership

UTSG

Limestone & Clay Mining

55.00%

IKSG

Packaging Paper

60.00%

KIG

Industrial Estate

65.00%

KIG

Industrial Estate

65.00%

Swadaya Gra

Steel fabrication, contractor

25.00%

Varia Usaha

Transport and general trading

24.90%

Eternit Gresik Building materials

17.60%

SGG Prima Coal Trading Coal

99.99%

SGG Prima Beton Ready Mix Concrete

99.99%

Swadaya Graha Contractor & Machine Fabricator 25.00%

Varia Usaha

Transport and general trading

24.90%

Eternit Gresik

Building materials

17.60%

SGG Energy Prima Coal Mining and Trading

97.00%

SGG Prima Beton Ready Mix Concrete

99.99%

(15)

REGIONAL CEMENT PLAYERS

SMGR Corporate Presentation

JANUARY 2015

REGIONAL CEMENT PLAYERS

(16)

Kiln

1 unit

Cement

Mill

1 unit

COMPETITIVENESS OF SEMEN INDONESIA

Grinding

Plant

1 unit Cement

Mill

Kiln

4 unit

Cement

Mill

6 unit

Kiln

4 unit

Cement

Mill

9 unit

_Grinding

Plant

3 unit Cement

Mill

Integrated Cement Plant

4 location

Kiln

13 Unit

Cement Mill

22 Unit

Grinding Plant

2 location

COMPETITIVENESS OF SEMEN INDONESIA

Cement Mill

4 Unit

Warehouse

30 location

Packing Plant

23 location

Sea Port

12 location

Kiln

4 unit

Cement

Mill

6 unit

(17)

Export :

Clinker : 6.17

Cement: 5.77

Cap. : 5.6 mio

Cap. : 54.4 mio

SUPPLY-DEMAND CEMENT IN SOUTH EAST ASIA

Cement: 5.77

Cap. : 1.0 mio

Cap. : - mio

_{Cap. : 66.4 mio}

Potential Market

Cap. : 1.5 mio

DEMAND CEMENT IN SOUTH EAST ASIA

Cap. : 75 mio

Cap. : 22 mio

Source : Global cement

Cap. : 0.55 mio

mio

(18)

Kiln

1 unit

Cement

Mill

1 unit

Grinding

_Plant

NEW TARGET

STRATEGIC POSITION IN THE REGION

Kiln

4 unit

Cement

Mill

9 unit

Kiln

4 unit

Cement

Mill

6 unit

Grinding

1 unit Cement

Mill

TRATEGIC POSITION IN THE REGION

Kiln

4 unit

Cement

Mill

6 unit

Grindin

(19)

SMGR Corporate Presentation

JANUARY 2015

FINANCIAL UPDATE

(20)

FINANCIAL SUMMARY: 9M-2014 RESULTS

Description

(Rpbn)

9M-2013

9M-2014

Change

(%)

Revenue

17,391

19,349

11.3 Cost of revenue

9,551

10,898

14.1 Gross profit

7,840

8,451

7.8 Operating expenses

2,794

3,341

9.6 Operating income

5,104

5,209

2.1 Ebitda

5,838

6,090

4.3 Net Income

3,906

4,088

4.7 EPS (full amount)

659

689

4.7 9M

9M

Ratio (%)

Formula

₂₀₁₃

9M

₂₀₁₄

9M

Ebitda margin

Ebitda / Revenue

33.6

31.5 Interest coverage (x)

Ebitda / Interest

_expense

25.15

25.22 Cost ratio

[COGS + Opex] /

_Revenue

71.0

73.6 Total debt to equity *)

Total debt / Total

_equity

20.4

16.7 Total debt to asset *)

Total debt / Total asset

14.5

12.1 *) Total debt calculated from interest bearing debt

RESULTS

EBITDA (Rp billion)

6090

NET INCOME (Rp billion)

EBITDA Margin (%)

9M-10

9M-11

9M-12

9M-13

9M-14

34.5%

32.8%

34.6%

33.6%

31.5%

4088

9M10

9M11

9M12

9M13

9M14

Together We Build a Better Future

NET INCOME Margin (%)

2.522

2.761 9M10

9M11 9M2012 9M2013 9M2014

9M-10

9M-11

9M-12

9M-13

9M-14

(21)

Cash balance (IDR bn)

3709

4.213

3.905

3.682 _3.317

3.846

5.283 * Include short term investment

STRONG BALANCE SHEET AND RETURNS

3709

4.213

3.905

3.682 _3.317

3.846 2008

2009

2010

2011

2012

2013 9M2014

Debt/EBITDA

2008 2009

2010 2011 2012 2013

The projected adjusted debt/EBITDA of 2.0x to

maintain rating level from Moody’s Investors

Service.

Total debt (IDR bn)

3.912

4.083

3.850

1.871 STRONG BALANCE SHEET AND RETURNS

251

199

686

1.871 2008

2009

2010

2011

2012

2013 9M2014

Return on Assets

24,0%

25,8%

23,5%

_20,1%

Together We Build a Better Future

17,4%

18,2%

24,0%

23,5%

_20,1%

2008

2009

2010

2011

2012

2013

(22)

REGULAR DIVIDEND PAYMENTS WITH ATTRACTIVE YIELD

1,829.5 1,816.7

1,962.7

2,181.3

2,416.6

2000

2500

3000

Total Dividend Payout

Average: 50%

SMGR DIVIDEND PAY OUT RATIO IN THE LAST 7 YEARS

887.7 2007 2008 2009 2010 2011 2012 2013

Total

Dividend

(IDR billion)

50%

55%

50%

_45%

2007

2008

2009

2010

2011

2012

2013

Average: 50%

REGULAR DIVIDENDS

REGULAR DIVIDEND PAYMENTS WITH ATTRACTIVE YIELD



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

(IDR billion)

(23)

SMGR Corporate Presentation

JANUARY 2015

STRATEGIC PROJECTS

(24)

SMGR LONG TERM STRATEGIC FOCUS

THE OVERALL

1. Undertake Capacity Growth

THE OVERALL

STRATEGY

COMBINES

66 CRITICAL

ELEMENTS

1. Undertake Capacity Growth

2. Manage Energy Security

3. Enhance Company Image

4. Move Closer To The Customer

5. Enable Corporate Growth

ELEMENTS

6. Manage Key Risks

SMGR LONG TERM STRATEGIC FOCUS

Undertake Capacity Growth

Manage Energy Security

Enhance Company Image

Move Closer To The Customer

Enable Corporate Growth

(25)

CEMENT PLANTS PROJECTS

New Plants

Location

(mn tons)

/Capacity

Investment

(US$ mn)

Construction

Start

Completion

Indarung VI-SumBar

3.0

352 2013

Q3-2016

Rembang - Java

3.0

403 2013

Q3-2016

Rembang - Java

3.0

403 2013

Q3-2016

TOTAL CAPEX

6.0

755 Plant

_{(mio tons)}

Capacity

_Operation

Est. Time

Location

New Cement Mill

1.5 2013 - Q3

Tuban

Cement Mill

0.4 2014 - Q2

Gresik Plant B

New Cement Mill

0.9 2015 – Q1

Dumai

New Cement Plant

3.0 2016 - Q3

Indarung

These strategic projects will ensure sustainability of

the Company’s market leadership

New Cement Plant

3.0 2016 - Q3

Indarung

New Cement Plant

3.0 2016 - Q3

Rembang

New Cement Plant

-

Domestic Area

CEMENT PLANTS PROJECTS

INDARUNG PROJECT

REMBANG PROJECT

MAIN SITE STORAGE

CYCLONE PREHEATER

MAIN SUB STATION

PREHEATER AREA

MAIN SITE RAW MILL & PYRO

(26)

INSTALLED CAPACITY (Mio Ton)

Installed Capacity

17,1

18

19

19 20,2

25,3

2007 2008 2009 2010 2011 2012

INSTALLED CAPACITY (Mio Ton)

39,3 40,8

Installed Capacity

25,3

30 31,8 33,3

39,3 40,8

(27)

CONCLUSION: WHY SMGR?

SMGR Corporate Presentation

JANUARY 2015

CONCLUSION: WHY SMGR?

(28)



Outstanding business performance

–

Leading cement player in Indonesia with over

sales volume for

cement capacity (Source: Indonesia Cement Association (“ASI”))

–

Strategically

–

As of Dec 2012, acquired Thang Long Cement Company, Vietnam by 70%

share with installed capacity 2.3 mio tons per annum

Strengths of SMGR

SMGR’s COMPARATIVE & COMPETITIVE ADVANTAGE DRIVE

TO BE THE MARKET LEADER IN INDONESIA

Outstanding

structure and

financial

policies

Robust cash flow

Outstanding

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

consumption

–

Concerns on environmental and Corporate Social Responsibility programs to

ensure sustainable growth.



Favourable industry outlook

–

Cement consumption pretty much in

–

Real estate and infrastructure projects and

cement

–

High barriers to entry (plant, distribution and brand investment costs)

–

Disciplined investment on supply side



Robust cash flow generation

Robust cash flow

generation



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

–

Conservative capital structure policy; low use of leverage

–

Access to capital markets for expansion initiatives



Experienced management team

–

Experienced and successful management team

Outstanding business performance

Leading cement player in Indonesia with over 43.9% market share based on

sales volume for 2Q-2014 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

SMGR’s COMPARATIVE & COMPETITIVE ADVANTAGE DRIVES SMGR

TO BE THE MARKET LEADER IN INDONESIA

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 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 with Indonesian economic growth

Real estate and infrastructure projects and favorable interest rates as key

cement 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 credit metrics]

Conservative capital structure policy; low use of leverage

Access to capital markets for expansion initiatives

Experienced management team

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PART.

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● economic, social and political conditions in Indonesia, and the impact such conditions have on construction and infrastructur

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economic, social and political conditions in Indonesia, and the impact such conditions have on construction and infrastructure spending in Indonesia;

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accidents, natural disasters or outbreaks of infectious diseases, such as avian influenza, in our markets;

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.

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