Smartnews. Performance Summary. Production. Revenue. June 2007

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Smartnews

June 2007

Performance Summary

371

510 2,958

2,357

850

518

824

470 -500

1,000

1,500

2,000

2,500

3,000

Jun-06

Jun-07

R

p

b

ill

io

n

Sales

Gross Profit

EBITDA

Net Income

The Company achieved stronger

results in the first semester of 2007

compared to the same period last

year. Gross profit tremendously

increased

by

64.0%

to

Rp 850.18 billion, while EBITDA

tagged along and considerably

improved

by

75.3%

to

Rp 823.66 billion. Net income also

recorded an increase of 37.3% to

Rp

509.92 billion

from

Rp 371.42 billion last year.

As of June 30, 2007, total palm plantation hectarage of the Company was about 122,000 hectares, which

included mature (95,800 hectares) and immature (26,200 hectares) estates. Nucleus estates comprised

98,500 hectares and plasma estates comprised 23,500 hectares. Total area increased by 11.6%

compared to June 30, 2006, following our successful planting of approximately 13,800 ha of palm

plantations.

Production

Description

June 2006

June 2007

Growth

FFB produced - ton

1,030,167

948,109

-8.0%

CPO produced - ton

267,063

243,332

-8.9%

PK produced - ton

55,982

53,618

-4.2%

Oil extraction rate - %

23.30

23.51 0.9%

Kernel extraction rate - %

4.88

5.18 6.1%

FFB production in the second quarter of

2007 improved by 10% over the first quarter

of 2007. However, year to date FFB

production was still lower by 8.0%

compared to the first semester of last year.

The decrease was mainly due to the

prolonged drought that had affected our

production in Jambi and South Kalimantan

since the last quarter of 2006. Oil and

kernel extraction rates increased to 23.51%

and 5.18%, respectively.

The combination of these resulted to CPO production of 243,332 tons and PK production of 53,618 tons,

a decrease by 8.9% and by 4.2%, respectively, compared to the first semester of 2006.

Revenue

Sales Volume (in mn tons)

584

76

89

485 -100

200

300

400

500

600

700 CPO Based

PK Based

Jun-06

Jun-07

Total revenues for the first semester of

2007 grew by 25.5% to Rp 2,957.97 billion

regardless of a decline in sales volume by

13.0%, due to lower CPO production and

reduced trading volume. The sales volume

decrease was nonetheless compensated

by a 44.5% increase in average selling

prices in line with the uptrend of

international CPO prices from US$ 375 per

ton to US$ 622 per ton during the first

semester of 2007.

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The increase in average selling price in Rupiah terms was lower than the increase in international CPO

market price because of the appreciation of average foreign exchange rate of Rupiah against US$

to Rp 9,031 per US$ 1 during the first semester of 2007 from Rp 9,202 per US$ 1 during the first semester

of 2006.

June 2006

June 2007

Products

Rp bn

%

Rp bn

%

Cooking Oil

239.85

10.2

354.66

12.0 Margarine

102.84

4.4

177.40

6.0 Total Branded

342.69

14.6

532.06

18.0 Refined Product *)

1,148.00

48.7 1,273.58

43.1 CPO and

non-refined product

840.28

35.6 1,127.16

38.1 Total Unbranded

1,988.28

84.3 2,400.74

81.2 Others

26.33

1.1

25.17

0.8 Total Sales

2,357.30

100.0 2,957.97

100.0 During the first semester of 2007, sales of

branded products, both in cooking oil and

margarine segments, showed substantial

increases of 47.9% and 72.5%, respectively,

supported by increase in selling price and

sales volume as well. Branded products sales

increased to Rp 532.06 billion from

Rp 342.69 billion last year. At the same time,

sales of unbranded products also increased

by 20.7% to Rp 2,400.74 billion from

Rp 1,988.28 billion during the first semester

last year.

Cost of goods sold

Cost of goods sold for the first semester of 2007

increased by 14.6% to Rp 2,107.79 billion from

Rp 1,838.97 billion for the same period last year.

The higher cost of goods sold was mainly due to

the increase in average FFB purchase price from

plasma and average CPO purchase price for

trading requirements due to the increase in

international market price.

1,839

2,108

-500

1,000

1,500

2,000

2,500

Jun-06

Jun-07

COGS (Rp billion)

Nonetheless, the increase in cost of goods sold was not as high as the increase in sales, resulting to higher

gross margin of 28.7% compared to 22.0% for the first semester of 2006.

Operating income

For the first semester of 2007, the Company’s

operating

income

almost

doubled

to

Rp 729.68 billion from Rp 382.85 billion as a result

of

increasing

gross

profit

by

64.0%

to

Rp 850.18 billion.

470 824 696 371 510 730 383 398

-200

400

600

800 1,000

Jun-06

Jun-07

R

p

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ill

io

n

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Assets

As of June 30 2007, the Company’s total assets grew

by 34.8% to Rp 6,442.06 billion from Rp 4,777.69 billion

last year.

The increase mainly resulted from the expansion of oil

palm plantations by about 13,800 ha, the on-going

construction of a new refinery in South Kalimantan and

increase in cash balances.

4,778

6,442

2,494

3,399

2,281

3,043

-1,000 2,000 3,000 4,000 5,000 6,000 7,000 Jun-06 Jun-07

R

p

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Assets

Liabilities

Shareholders' equity

Liabilities

Total liabilities as of June 30, 2007 increased by 36.3% to Rp 3,398.67 billion from Rp 2,494.39 billion,

mainly as the result of increase funding requirements. Of this amount, total bank debts was

Rp 627.96 billion.

As of June 30, 2007, our gearing remained at healthy levels with debt to equity ratio of 1.12 and bank debts

to EBITDA ratio of 0.38 (on annualized basis).

Shareholders’ equity

Shareholders’ equity at the end of June 2007 sharply increased by 33.4% to Rp 3,043.38 billion from

Rp 2,280.91 billion at the preceding year. The Company’s retained earnings was Rp 541.58 billion at end of

June 2007 after distribution of Rp 132.12 billion dividends on June 25, 2007 against 2006 earnings.

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PT SINAR MAS AGRO RESOURCES AND TECHNOLOGY Tbk PT SINAR MAS AGRO RESOURCES AND TECHNOLOGY Tbk

DAN ANAK PERUSAHAAN AND ITS SUBSIDIARIES

Neraca Konsolidasi Consolidated Balance Sheets

30 Juni 2007 dan 2006 June 30, 2007 and 2006

2007 2006

Rp Rp

AKTIVA LANCAR CURRENT ASSETS

Kas dan setara kas 650,963,436,118 118,679,465,155 Cash and cash equivalents

Investasi jangka pendek 37,335,606,717 164,385,831,999 Short-term investments

Piutang usaha Trade accounts receivable

Pihak yang mempunyai hubungan istimewa 135,046,304,089 112,145,511,251 Related parties

Pihak ketiga 273,257,911,455 197,585,334,702 Third parties

Piutang lain-lain - pihak ketiga 19,600,861,703 53,525,093,432 Other receivables - third parties

Persediaan 938,683,715,743 700,567,142,854 Inventories

Biaya dibayar dimuka dan aktiva lancar lainnya 405,584,896,812 158,273,919,526 Prepaid expenses and other current assets

Pajak Pertambahan Nilai dibayar dimuka - bersih 148,197,837,164 73,912,513,183 Prepaid Value Added Tax - net

JUMLAH AKTIVA LANCAR 2,608,670,569,801 1,579,074,812,102 TOTAL CURRENT ASSETS

AKTIVA TIDAK LANCAR NON-CURRENT ASSETS

Piutang dari pihak yang mempunyai hubungan

istimewa 134,195,354,153 140,767,893,525 Due from related parties

Aktiva pajak tangguhan - bersih 53,632,078,652 18,856,635,415 Deferred tax assets - net

Investasi dalam saham pada perusahaan asosiasi 151,774,242,642 334,774,951,796 Investments in shares of associates

Tanaman perkebunan Plantations

Tanaman telah menghasilkan - setelah

dikurangi akumulasi amortisasi sebesar Mature plantations - net of accumulated amortization

Rp 266.085.479.764 pada periode 2007 dan of Rp 266,085,479,764 in 2007 and

Rp 220.774.214.043 pada periode 2006 866,802,831,841 855,440,085,408 Rp 220,774,214,043 in 2006

Tanaman belum menghasilkan 309,065,919,090 136,817,617,813 Immature plantations

Aktiva tetap - setelah dikurangi akumulasi Property, plant and equipment - net of accumulated

penyusutan sebesar Rp 547.369.488.977 depreciation of Rp 547,369,488,977 in 2007 and

pada periode 2007 dan Rp 457.124.439.478 Rp 457,124,439,478 in 2006

pada periode 2006 1,826,596,999,975 1,376,431,589,942

Aktiva tidak berwujud Intangible assets

Goodwill - bersih 35,205,442,422 65,748,044,748 Goodwill - net

Merek dagang - bersih 5,725,950,000 6,486,562,500 Brands and trademarks - net

Aktiva lain-lain Other assets

Taksiran tagihan pajak 95,024,191,195 76,985,127,325 Estimated claims for tax refund

Bibitan 31,397,320,140 37,837,511,132 Nursery

Biaya tangguhan hak atas tanah - bersih 19,815,479,663 18,130,533,631 Deferred landrights - net

Biaya pengembangan piranti lunak - bersih 11,437,274,480 11,437,274,480 Software development costs - net

Biaya ditangguhkan lainnya - bersih 2,336,122,587 8,472,989,345 Other deferred charges - net

Lain-lain 290,384,691,486 110,433,815,611 Others

Jumlah aktiva lain-lain 450,395,079,551 263,297,251,524 Total other assets

JUMLAH AKTIVA TIDAK LANCAR 3,833,393,898,326 3,198,620,632,671 TOTAL NON-CURRENT ASSETS

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Neraca Konsolidasi Consolidated Balance Sheets

30 Juni 2007 dan 2006 (Lanjutan) June 30, 2007 and 2006 (Continued)

2007 2006

Rp Rp

KEWAJIBAN DAN EKUITAS LIABILITIES AND EQUITY

KEWAJIBAN LANCAR CURRENT LIABILITIES

Hutang bank jangka pendek 443,646,000,000 239,940,000,000 Short-term bank loans

Hutang usaha Trade accounts payable

Pihak yang mempunyai hubungan istimewa 371,262,710,854 279,849,360,361 Related parties

Hutang lain-lain Other payables

Pihak yang mempunyai hubungan istimewa 22,635,000,000 23,250,000,000 Related party

Uang muka pelanggan Advances from customers

Pihak yang mempunyai hubungan istimewa - 131,376,341 Related party

Biaya yang masih harus dibayar 44,803,211,887 34,475,993,008 Accrued expenses

Hutang pajak 87,837,568,289 11,988,014,735 Taxes payable

Bagian hutang jangka panjang yang akan jatuh

tempo dalam waktu satu tahun 52,607,118,163 215,553,401,031 Current maturities of long-term debts

JUMLAH KEWAJIBAN LANCAR 1,247,164,956,224 1,040,473,670,956 TOTAL CURRENT LIABILITIES

KEWAJIBAN TIDAK LANCAR NON-CURRENT LIABILITIES

Kewajiban pajak tangguhan - bersih 230,192,402,717 129,438,957,362 Deferred tax liabilities - net

Cadangan imbalan pasti pasca-kerja 54,026,603,000 34,116,967,823 Defined post-employment benefits reserve

Hutang jangka panjang - setelah dikurangi bagian

yang akan jatuh tempo dalam waktu satu tahun 131,708,611,808 630,511,006,061 Long-term debts - net of current maturities

Hutang kepada pihak yang mempunyai hubungan

istimewa 1,735,580,086,887 659,844,763,282 Due to related parties

JUMLAH KEWAJIBAN TIDAK LANCAR 2,151,507,704,412 1,453,911,694,528 TOTAL NON-CURRENT LIABILITIES

KELEBIHAN BAGIAN RUGI BERSIH EXCESS OF EQUITY IN NET

PERUSAHAAN ASOSIASI ATAS LOSSES OF AN ASSOCIATE

BIAYA PEROLEHAN - 2,394,770,810 OVER COST

HAK MINORITAS ATAS AKTIVA MINORITY INTEREST IN NET

BERSIH ANAK PERUSAHAAN 10,000,000 10,000,000 ASSETS OF A SUBSIDIARY

EKUITAS EQUITY

Modal saham - nilai nominal Rp 200 per saham Capital stock - Rp 200 par value per share

Modal dasar - 5.000.000.000 saham Authorized - 5,000,000,000 shares

Modal ditempatkan dan disetor

penuh - 2.872.193.366 saham 574,438,673,200 574,438,673,200 Issued and fully paid - 2,872,193,366 shares

Tambahan modal disetor 1,662,472,039,200 1,662,472,039,200 Additional paid-in capital

Selisih kurs penjabaran 104,010,068,115 107,928,118,624 Difference in foreign currency translation

Selisih transaksi perubahan ekuitas Difference arising from changes in subsidiaries'

anak perusahaan 68,077,476,883 24,703,013,824 equity

Selisih transaksi perubahan ekuitas Difference arising from changes in associated

perusahaan asosiasi 561,583,860 16,163,179,153 companies' equity

Selisih nilai transaksi restrukturisasi entitas Difference arising from restructuring transactions

sepengendali 92,241,224,885 (11,987,787,393) of entities under common control

Saldo laba (defisit) 541,580,741,348 (92,811,928,129) Retained earnings (deficit)

JUMLAH EKUITAS 3,043,381,807,491 2,280,905,308,479 TOTAL EQUITY

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Laporan Laba Rugi Konsolidasi Consolidated Statements of Income

Untuk Periode Enam Bulan yang Berakhir 30 Juni 2007 dan 2006 For the Six-Month Periods Ended June 30, 2007 and 2006

2007 2006

Rp Rp

PENDAPATAN USAHA 2,957,968,953,332 2,357,304,790,579 REVENUES

BEBAN POKOK PENJUALAN 2,107,788,242,666 1,838,972,101,456 COST OF GOODS SOLD

LABA KOTOR 850,180,710,666 518,332,689,123 GROSS PROFIT

BEBAN USAHA OPERATING EXPENSES

Penjualan 90,738,584,036 87,477,074,665 Selling

Umum dan administrasi 29,760,291,249 48,001,658,475 General and administrative

Jumlah Beban Usaha 120,498,875,285 135,478,733,140 Total Operating Expenses

LABA USAHA 729,681,835,381 382,853,955,983 INCOME FROM OPERATIONS

PENGHASILAN (BEBAN) LAIN-LAIN OTHER INCOME (EXPENSES)

Bagian atas laba bersih perusahaan

asosiasi - bersih 15,408,958,282 789,558,862 Equity in net profit of associates - net

Pendapatan bunga 6,134,473,049 9,805,728,614 Interest income

Beban bunga dan keuangan lainnya (68,115,576,119) (64,082,733,701) Interest and other financial charges

Laba (rugi) selisih kurs - bersih (11,124,658,543) 65,272,532,201 Gain (loss) on foreign exchange - net

Lain-lain - bersih 24,356,704,000 3,378,765,549 Miscellaneous - net

Penghasilan (Beban) Lain-lain - Bersih (33,340,099,331) 15,163,851,525 Other Income (Expenses) - Net

LABA SEBELUM PAJAK 696,341,736,050 398,017,807,508 INCOME BEFORE TAX

BEBAN PAJAK TAX EXPENSE

Kini 95,045,848,030 2,088,870,518 Current

Tangguhan 91,372,098,826 23,999,446,629 Deferred

Jumlah Beban Pajak 186,417,946,856 26,088,317,147 Total Tax Expense

LABA SEBELUM LABA PRA-AKUISISI 509,923,789,194 371,929,490,361 INCOME BEFORE PRE-ACQUISITION INCOME

LABA PRA-AKUISISI - (514,063,979) PRE-ACQUISITION INCOME

LABA BERSIH 509,923,789,194 371,415,426,382 NET INCOME

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PT SINAR MAS AGRO RESOURCES AND TECHNOLOGY Tbk PT SINAR MAS AGRO RESOURCES AND TECHNOLOGY Tbk DAN ANAK PERUSAHAAN AND ITS SUBSIDIARIES Laporan Perubahan Ekuitas Konsolidasi Consolidated Statements of Changes in Equity Untuk Periode Enam Bulan yang Berakhir 30 Juni 2007 dan 2006 For the Six-Month Periods Ended June 30, 2007 and 2006

Selisih Selisih Transaksi Nilai Selisih Perubahan Transaksi Transaksi Ekuitas Restrukturisasi Perubahan Perusahaan Entitas Ekuitas Anak Asosiasi/ Sepengendali/ Tambahan Selisih Kurs Perusahaan/ Difference Difference

Modal Penjabaran/ Difference Arising from Arising from

Disetor/ Difference in Arising from Changes in Restructuring Saldo laba

Additional Foreign Changes in Associated Transactions of (Defisit)/

Modal Saham/ Paid-in Currency Subsidiaries' Companies' Entities Under Retained Earnings Jumlah Ekuitas/

Capital Stock Capital Translation Equity Equity Common Control (Deficit) Total Equity

Saldo per 1 Januari 2006 574,438,673,200 1,662,472,039,200 116,703,860,204 24,703,013,824 26,467,936,017 (11,987,787,393) (464,227,354,511) 1,928,570,380,541 Balance as of January 1, 2006 Selisih kurs karena penjabaran

laporan keuangan Difference in foreign currency translation of

perusahaan asosiasi - - (8,775,741,580) - - - - (8,775,741,580) associated companies' financial statements

Selisih transaksi perubahan Difference arising from changes in

ekuitas perusahaan asosiasi - - - - (10,304,756,864) - - (10,304,756,864) associated companies' equity Laba bersih periode berjalan - - - 371,415,426,382 371,415,426,382 Net income for the period Saldo per 30 Juni 2006 574,438,673,200 1,662,472,039,200 107,928,118,624 24,703,013,824 16,163,179,153 (11,987,787,393) (92,811,928,129) 2,280,905,308,479 Balance as of June 30, 2006 Saldo per 1 Januari 2007 574,438,673,200 1,662,472,039,200 103,464,328,854 68,077,476,883 16,972,153,478 (11,987,787,393) 163,777,846,990 2,577,214,731,212 Balance as of January 1, 2007 Selisih kurs karena penjabaran

laporan keuangan Difference in foreign currency translation of

perusahaan asosiasi - - 545,739,261 - - - - 545,739,261 associated companies' financial statements

Selisih transaksi perubahan Difference arising from changes in associated

ekuitas perusahaan asosiasi - - - - (16,410,569,618) - - (16,410,569,618) companies' equity

Selisih nilai transaksi restrukturisasi Difference arising from restructuring transactions

entitas sepengendali - - - 104,229,012,278 - 104,229,012,278 of entities under common control

Dividen tunai - - - (132,120,894,836) (132,120,894,836) Cash dividends

Laba bersih periode berjalan - - - 509,923,789,194 509,923,789,194 Net income for the period Saldo per 30 Juni 2007 574,438,673,200 1,662,472,039,200 104,010,068,115 68,077,476,883 561,583,860 92,241,224,885 541,580,741,348 3,043,381,807,491 Balance as of June 30, 2007

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Laporan Arus Kas konsolidasi Consolidated Statements of Cash Flows

Untuk Periode Enam Bulan yang Berakhir 30 Juni 2007 dan 2006 For the Six-Month Periods Ended June 30, 2007 and 2006

2007 2006

Rp Rp

ARUS KAS DARI AKTIVITAS OPERASI CASH FLOWS FROM OPERATING ACTIVITIES

Penerimaan kas dari pelanggan 2,753,848,866,101 2,293,141,383,128 Cash receipts from customers

Pembayaran kas untuk pemasok, kontraktor, Cash paid to suppliers, contractors, employees

karyawan dan lainnya (2,167,292,426,784) (1,816,488,133,993) and others

Kas yang diperoleh dari operasi 586,556,439,317 476,653,249,135 Cash generated from operations

Pembayaran untuk aktivitas operasi lainnya - bersih (294,002,663,562) (402,835,856,265) Payment for other operating activities - net

Pembayaran beban bunga - bersih (85,310,968,097) (85,242,765,903) Payment of interest - net

Pembayaran pajak penghasilan (48,338,886,602) (43,495,424,102) Payment of of income taxes

Kas Bersih Diperoleh dari (Digunakan untuk) Aktivitas Operasi 158,903,921,056 (54,920,797,135) Net Cash Provided by (Used in) Operating Activities

ARUS KAS DARI AKTIVITAS INVESTASI CASH FLOWS FROM INVESTING ACTIVITIES

Penurunan (penambahan) investasi dalam saham Decrease (increase) in investment in shares

pada perusahaan asosiasi 311,500,000,000 (663,000,000) of associated company

Hasil penjualan aktiva tetap 3,687,683,624 8,520,199,326 Proceeds from sale of property, plant and equipment

Perolehan aktiva tetap dan penambahan Acquisitions of property, plant and equipment and

tanaman perkebunan (287,748,584,529) (117,450,983,855) additional plantation estates

Penambahan bersih investasi jangka pendek (24,457,315,050) (43,199,280,929) Net increase in short-term investments

Penambahan pembukaan lahan (13,249,644,252) (12,849,747,768) Additional land clearing

Kenaikan bersih bibitan (3,006,905,450) (12,005,149,331) Net increase in nursery

Penerimaan dividen tunai - 96,750,000,000 Receipt of cash dividends

Pembayaran untuk akuisisi anak perusahaan Payment for acquisition of a subsidiary

setelah dikurangi saldo kas pada tanggal akuisisi - (30,228,072,023) net of cash balance at acquisition date

Kas Bersih Digunakan untuk Aktivitas Investasi (13,274,765,657) (111,126,034,580) Net Cash Used in Investing Activities

ARUS KAS DARI AKTIVITAS PENDANAAN CASH FLOWS FROM FINANCING ACTIVITIES

Penambahan hutang kepada pihak yang mempunyai

hubungan istimewa 1,071,396,558,185 63,135,837,651 Additional due to related parties

Penerimaan hutang bank jangka pendek 454,066,478,208 - Additional short-term loans

Pembayaran hutang jangka panjang (604,601,689,645) (75,313,188,538) Payments of long-term debts

Pembayaran hutang kepada pihak yang mempunyai

hubungan istimewa (275,342,056,000) (425,932,720,000) Payments of due to related parties

Pembayaran hutang bank jangka pendek (244,715,586,168) - Payments of short-term loans

Pembayaran dividen tunai (132,120,894,836) - Payment of cash dividends

Penambahan piutang kepada pihak yang

mempunyai hubungan istimewa (87,113,007,672) (25,046,125,016) Additional due from related parties

Penambahan hutang jangka panjang - 364,528,000,000 Additional long-term debts

Kas Bersih Diperoleh dari (Digunakan untuk) Aktivitas Pendanaan 181,569,802,072 (98,628,195,903) Net Cash Provided by (Used in) Financing Activities

KENAIKAN (PENURUNAN) BERSIH KAS DAN SETARA KAS 327,198,957,471 (264,675,027,618) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

KAS DAN SETARA KAS AWAL PERIODE 323,764,478,647 383,354,492,773 CASH AND CASH EQUIVALENTS AT BEGINNING OF THE PERIOD