PT Pelabuhan Indonesia III (Persero)

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DISCLAIMER

2 This presentation has been prepared by PT Pelabuhan Indonesia (Persero)

(“

Pelindo

III”

or the

“Issuer”)

. This presentation is being presented solely

for your information and is subject to change without notice. By accessing this presentation, you are agreeing to be bound by the restrictions set out

below. Any failure to comply with these restrictions may constitute a violation of applicable securities laws.

This presentation contains forward-looking statements that involve risks and uncertainties. All statements other than statements of historical facts are

forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause the actual results,

performance or achievements of Pelindo III to be materially different from those expressed or implied by the forward-looking statements.

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TABLE OF CONTENT

3 PRIVATE & CONFIDENTIAL

COMPANY OVERVIEW

I

INDUSTRY OVERVIEW

II

KEY CREDIT HIGHLIGHTS

III

FINANCIAL HIGHLIGHTS

IV

4

12

15

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COMPANY OVERVIEW

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1,856 1,968 2,117

1,355 1,396 2,504 2,643 2,802

1,023 1,055

Domestic International

LEADING PORT OPERATOR IN INDONESIA

5 COMPANY OVERVIEW

Pelindo III is a leading port operator in Indonesia, serving the fast growing regions of Central and Eastern Indonesia,

focusing on both the domestic and international container market

(TEUs '000)

CAGR (2015 – 2017) : 6.2%

Operates

4 out of the top 10 container

ports in Indonesia

CARGO SERVICES (78%)

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SHIP SERVICES (11%)

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OTHER SERVICES (11%)

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Cargo handling services and provision of

cargo storage and transportation facilities:

- Containerized

- Dry Bulk

- Liquid Bulk

- General Cargo

43 ports

in some of the largest and fastest growing provinces

Operating history of more than

57 years

Strategically important

to the maritime development of Indonesia

Gateway hub

to Central and Eastern Indonesia

Complete range of ship services

including:

- Pilotage

- Towage

- Berthing Services

Complementary value added services,

such as:

- Provision of fresh water

- Electricity

- Medical services

- Other non port related services

Pelindo

III’s container traffic

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(1) Based on internal estimates and excluding private ports and non-commercial government-owned ports (2) As a percentage of net revenue for 1H 2018

YoY 3.1%

4,360 4,611

4,919

2,378 2,451

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76% 11%

7%

2% 4%

Containers General Cargo Dry Bulk

Liquid Bulk Other Cargo Services

14%

40% 21%

25%

Pilotage Towage Berthing Other Ship Services

5,016 5,357

Cargo Services Ship Services Other Services

INTEGRATED SERVICE OFFERING

6 COMPANY OVERVIEW

CARGO SERVICES (78%)

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SHIP SERVICES (11%)

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OTHER SERVICES (11%)

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NET REVENUE GROWTH

(Rp Billions)

Rp3.5

Trillion

(1) As a percentage of net revenue for 1H 2018

1H 2018 REVENUE SPLIT PER BUSINESS LINE

6,480

Other Services (%) of net revenue

1H 2018 REVENUE SPLIT PER BUSINESS LINE

_{YoY REVENUE TREND}

2015 2016 2017 1H 2017 1H 2018

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GROUP AND SHAREHOLDING STRUCTURE

7 COMPANY OVERVIEW

6

4

13 DIRECT SUBSIDIARIES

AFFILIATES

INDIRECT SUBSIDIARIES

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GATEWAY DOMESTIC AND INTERNATIONAL PORT

COMPANY OVERVIEW

Pelindo

III’s main branch in

Tanjung

Perak serves as the gateway port for Surabaya (Indonesia’s second largest city), as the domestic hub

for Central and Eastern Indonesia, and one of the key hub identified in the Sea Toll Program

Port Net Revenue (Rp Billions)

Small Port

S

Tanjung Emas (TEUs)

Tanjung Perak (TEUs)

Banjarmasin (TEUs)

Other Ports (TEUs)

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(B)

(C)

Capacity Throughput Utilization 1,191 1,487

Capacity Throughput Utilization

619 619 825

984 1,058 1,158 1,058 1,158

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EVOLUTION OF PELINDO III TO A FULLY-FLEDGED

COMMERCIAL PORT AGENCY

COMPANY OVERVIEW

1992

Formally incorporated as

a limited liability company

pursuant to Deed No. 5

dated December 1, 1992

1999

Pelindo III entered into a

JV with DP World Asia

Holdings Limited

(“DPW”) under 20 year

concession ending 2019

2010

We pioneered the window

system at Nilam Terminal at

Tanjung Perak and TPKB at

Banjarmasin

2011

2012

We entered into two joint

ventures with PT Usaha Era

Pratama

Nusantara (“UEPN”),

a subsidiary of PT AKR

Corporindo

(“AKR”) to

develop and operate Java

Integrated Industrial Port and

Estate (“JIIPE”)

2013

ESTABLISHED

2014

Awarded 25 years

concession for Surabaya

West Access Channel and

established APBS

2015

Sea Toll Program

Implementation

commenced

operations of the

international

container terminal

at Teluk Lamong

2016

commenced

operations of the

domestic dry and

liquid bulk terminal

at JIIPE Port

2017

Achieved capacity of

more than 10 million

TEUs and close to 5

million TEUs throughput

2018 - 2022

Key future developments

• Phase III of Teluk Lamong

Terminal

• JIIPE Project

• Kendal Port

• Tanjung Bulupandan

• New Gili Mas Terminal at

port in Lembar

• Expansion of Benoa port

in Bali

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KEY BUSINESS STRATEGIES

10 COMPANY OVERVIEW

People

Processes

Technology

Cultivate a productive culture in the

organization

Business Processes

Enables People & Processes, and

supports daily operations



Participative leadership culture



Maintain optimal number of

employees with appropriate skill

sets



Compatible values



Improve competencies and

understanding of the Company

through rotation of roles



Standardize services in all ports to

increase efficiency



Port Community System



Automation of services



ICT Based System



Finance platform for payment

transfers

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•

Reconfiguring our terminals to cluster our cargo handling services at our major ports and at our other ports where feasible

•

Each terminal will have designated areas that are dedicated to handling specific types of cargo, thereby improving

productivity and reducing the waiting time for customers

•

Example of clustering services plan:

•

Tanjung Perak Port: Nilam Termina to focus on container and bulk commodities services and

Kalimas Terminal to focus on providing traditional shipping services, logistics and docking of small boats

•

Tanjung Emas Port: West Kalibaru Terminal to focus on dry and liquid bulk terminal services and Tambak Lorok to focus on traditional shipping services

11 KEY STRATEGIES

COMPANY OVERVIEW

Clustering of Services

To Achieve Greater Operational

and Cost Efficiency

•

Modernizing our port equipment and infrastructure throughout our port facilities to increase the capacity of our ports and improve the services provided to our customers

•

Modernizing our IT infrastructure, together with state of the art cargo handling equipment, will eliminate equipment down

time, increase berth utilization and continuously maximize efficiency and throughput at our ports

•

Modern equipment will provide greater automation of services and minimize costs

Modernization of Facilities at

Existing Ports

•

Expanding our operations by increasing capacity at our existing facilities and developing new ports in strategic locations

•

For example:

•

The development of our Teluk Lamong Terminal in 2011 order to reduce overcrowding at Tanjung Perak

•

The development of JIIPE port, an in integrated port and industrial estate, featuring multipurpose cargo handling capabilities

Prudent Development and

Expansion of New and Existing

Ports and Related Infrastructure

•

Expanding service offerings into other lines of business to

optimize the utilization of resources and diversify revenue base

•

Recently established subsidiaries to operate and grow new non-core lines of business

•

Net revenue from our non-core lines of business is expected to contribute more than 20.0% of total net revenue by 2019

Diversify Into Complementary

Business Lines

•

Focus on developing human resources and corporate culture as a recognition of the need to uphold a corporate culture that is aligned with business, industry and strategy

•

in recent years, employee benefits are reviewed and changes are implemented which we is believed contributed to a

reduction in employee turnover rate

Develop Our Human Resources

and Corporate Culture

•

Focusing on utilizing information technology as a key aspect in creating value for customers, partners and stakeholders

•

in the process of implementing an information and

communication technology (“ICT”) based system to monitor,

coordinate and execute our business activities

•

Plan to establish a fully integrated terminal and logistics handling system by 2019

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INDUSTRY OVERVIEW

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MARKET OVERVIEW

13 INDUSTRY OVERVIEW

GLOBAL PORT GROWTH 2006 - 2017

54%

Middle East-Indian Sub-Continent North America

Latin America

Africa

growth of 4.9% between 2006 to 2017

Asia accounting for 54% of global

container throughput for 2017

Impact of potentially untapped markets and

a rising middle class in Asia

Growth rate of container rate throughput has risen 4.9% globally since 2006-2017, with most contribution from Asia (60%) as an impact of

potentially untapped markets and a rising middle class

4.9%

Africa Oceania

REGIONAL CONTAINER THROUGHPUT MARKET

SHARE (2017)

A majority of inter-island trade and approximately 90% of

international trade is conducted via maritime

transport’

0 5 10 15

2010 2011 2012 2013 2014 2015 2016

Positive economic conditions have led to

Indonesia’s

throughput growth gaining further pace in 2017, with total

throughput volume estimated to have risen between 2016 and

2017 by 7.8% to about 14.8 million TEUs

GDP: CAGR

5.7%

Sea Toll Programme to support major

domestic sea lanes

Pendulum Nusantara system in an effort to

reduce high logistic costs.

State

owned

enterprise

companies

(Pelindos) handling most of the container

volumes in Indonesia

PROMINENT ASIA MARKET

ASIA DRIVING GLOBAL CONTAINER GROWTH

FAVOURABLE MARKET CONDITIONS IN INDONESIA

INTER-ISLAND CONNECTIVITY

INDONESIA CONTAINER THROUGHPUT

GOVERNMENT INITIATIVES

Million TEUs

Source: Drewry Maritime Research Source: Drewry Maritime Research Source: Drewry Maritime Research

Source: Drewry Maritime Research

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MARKET OVERVIEW

14 INDUSTRY OVERVIEW

7%

Belawan

Makasar

Tanjung Emas

Other

Tanjung Priok

Tanjung Perak

INDONESIA TOP 10 CONTAINER PORTS - 2017

PELINDO MARKET SHARE 2010 - 2017

OTHERS

• Banjarmasin 2.8% • Teluk Lamong 3.3% • Pontianak 1.9% • Samarinda 1.5% • Bitung 1,5%

• Remaining (each <0.2 MTEu) 12.0%

Pelindo IV

Pelindo III

Pelindo II

Collaboration of four Pelindo companies

in an effort to reduce high

logistic costs.

Strong domestic economic and trade development, geographic reliance on maritime transport, and stimulus packages from the Government

could support port industry in Indonesia to grow further

PENDULUM NUSANTARA

Develop a more efficient domestic shipping network

between six of

Indonesia’s major ports (

Belawan, Batam, Tanjung Priok, Tanjung Perak,

Makassar and Sorong) by upgrading these port facilities and increasing

their water depth

Allows larger vessels

to be deployed

,

which in turn would

significantly

reduce shipping costs and boost domestic trade

Support major domestic sea lanes

with well-developed ports through a

“hub and feeder model”

SEA TOLL PROGRAMME

Provide for more efficient cargo loading and

unloading services for

vessels as well as

achieve a more balanced distribution

of national

development resources across regions in Indonesia

Ensuring adequate dredging and access channel

to support Panamax

vessels and improving the draft of feeder ports

Source: Pelindo I, II, III, IV, Drewry Maritime Advisors

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KEY CREDIT HIGHLIGHTS

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KEY CREDIT HIGHLIGHTS

16 INVESTOR PRESENTATION

1 Leading market position in high growth

Indonesian market with high barriers to

entry

2 Strategically located ports

serving the fast growing

hinterland

3 Longstanding and diverse customer base

across geographies and industries

4 Established Port Operator Recognized

for Operational Performance

5 Strong Support from the

Government

6 Robust Financial Profile

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Leading Market Position in the Central and Eastern Indonesia

1. Leading market position in high growth Indonesian

market with high barriers to entry

(1)

KEY CREDIT HIGHLIGHTS

CONTAINER

Market Share

LIQUID BULK

Market Share

DRY BULK

Market Share

GENERAL CARGO

Market Share

CONTAINER TRAFFIC INDONESIA

_{MARKET SHARE OF PELINDO COMPANIES FOR 2017}

(2)

GDP INDONESIA, CONSTANT PRICES (Rp Quadrillion)

8%

47% 33%

12%

PELINDO I PELINDO II PELINDO III PELINDO IV

99.8%

97.0%

75.5%

25.8%

International

Domestic

2010

(1) Based on internal estimates and excluding private ports and non-commercial Government-owned ports (2) Market share is based on container throughput volume

High Growth Country with Heavy Reliance on Maritime Transportation

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1. Leading market position in high growth Indonesian

market with high barriers to entry

(1)

KEY CREDIT HIGHLIGHTS

Given the high barriers to entry and Pelindo

III’s first mover advantage, it is well placed to maintain its position as the

largest port operator in Central and Eastern Indonesia

High barriers to entry for new entrants to gain a foothold in Pelindo

III’s regional focus

Scarcity of sizeable coastal land

Process of obtaining licenses / permits

Significant capital expenditure with long lead time

Well-connected port network

Good relationships with key stakeholders

Developing a port requires large amounts of space, located in a maritime

environment with proximity to production or consumption areas

• Road / railway connections to the hinterland

• Gateway port / branch to disperse containers / cargo to domestic

ports throughout the region

• Obtaining government-issued licenses / permits for port operations

requires significant time

• Pelindo III enjoys several first mover advantages

New port opportunities are likely to be put up for tender

• Capital expenditure is required for port development / maintenance

including the acquisition of new equipment

• Construction of a port is a long-term project

• Pelindo III has established relationships with key stakeholders (many

of which are government related)

• Pelindo

III’s expertise in the region well

-positions them for any tender

opportunity

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2. Strategically located ports serving the fast growing hinterland

19 KEY CREDIT HIGHLIGHTS

South Kalimantan

–

Banjarmasin

Surabaya

–

Tanjung Perak

Bali

–

Benoa

Other Branch Connectivity

• One of the

largest cities in Kalimantan

, capital of South Kalimantan

• Strong mining industry; benefits from the

large quantities of coal and other

natural resources exported

from resource-rich Kalimantan

• Real gross regional domestic product CAGR for Central Kalimantan: 6.7%

(2012

–

2016)

• 2nd largest city in Indonesia

and

the industrial /

manufacturing hub of Central Eastern Indonesia

• Gateway hub to Eastern Indonesia

• Second largest province by GDP

,

accounting for

14.8% of Indonesian GDP

• Strategically located

near industrial areas, well

connected by developed toll road

• Real gross regional domestic product CAGR for East

Java: 5.7%

(2012

–

2016)

• One of the 5 largest cities in Indonesia

• Fourth largest province by GDP, accounting for 8.9% of Indonesian GDP

• Strong economic growth supported by various industries relocating

from Jakarta

• Connectivity to good inland road networks and planned railway network

• Real gross regional domestic product CAGR for Central Java: 5.3%

(2012

–

2016)

• Key port in

one of the most attractive tourist

destinations in Asia

• Ministry of Tourism supporting developing Benoa

into the

largest cruise passenger terminal in

Indonesia

• Real gross regional

domestic product CAGR for Bali:

6.5%

(2012

–

2016)

• Most of the ports are connected to road and railway

network

• It allows us and our customers to avoid urban traffic

as well as efficient transportation of cargo in and out

of our ports

• In addition, some plans are made to provide more

connectivity to our ports:

 Reactivation of Indro line at Kandangan railway station in 2028 which will connect the new Teluk Lamong

Terminal to the national railway station.

 Reactivation of a railway network to connect Tanjung Emas to the national railway system

 Local government of South Kalimantan is supporting the development of infrastructure around Banjarmasin

 Construction of a new railway line, for which we are in negotiations with state-owned enterprise, PT Kereta Api Indonesia, to collaborate and jointly develop, is

expected to directly connect and significantly reduce traveling time between Duduk Sampeyan Station in Gresik City to JIIPE Port

Semarang

–

Tanjung Emas

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3. Longstanding and diverse quality customer base

across geographies and industries

KEY CREDIT HIGHLIGHTS

Longstanding relationship with diverse customer base across industries and geographies, with high customer satisfaction

Strong Customer Diversity

Various Industry Served

International Container Destination

Key customers by service offering

Large Domestic Corporation

Shipping Lines

Local

International

Industrial Goods

Consumer

Goods Agriculture Oil and Gas

Mining Energy Infrastructure

SINGAPORE CHINA MALAYSIA

U.S SOUTH KOREA JAPAN

• Highly diversified customer base with low

concentration risk

o

Largest customer

–

20.0% of net revenue

o

Top 10 customers

–

23.4% of net revenue

• Diversity across vessel types,

including dry bulk,

liquid bulk, container, tanker, passenger, etc

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4. Established port operator recognized for operational and execution

performance

21 LONG TRACK RECORD

EFFICIENT OPERATION

OPERATIONAL EXCELLENCE

57 Years of Experience

45 operational and non-operational

awards for excellence between 2015 and

2017

Window System Benefits:

• Traffic and Port Efficiency

• More predictable cargo time

• Reduced waiting and berthing time

• Reduced turnover voyage time

Advanced Terminal Operations Systems

for :

• Ship Planning

• Yard Planning

• Gate Control

• Yard Inventory

• Vessel Billing

• Management Control and Reporting

Surpasses DGST standard

Maximum waiting time for domestic non-container cargo

Automated Stacking Cranes

KEY CREDIT HIGHLIGHTS

The highest award for good performance

at the annual BUMN Performance

Excellence Awards

The Zero Accident Award 2017 from

Badan Penyelenggara Jaminan Sosial

Employment

1

2

0.3 _0.2

Tanjung Emas Banjarmasin DGST Standards Pelindo III

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5. Strong Support from the Government

22 KEY CREDIT HIGHLIGHTS

Sea Toll Program

Port Development Program

Pelindo

III’s linkages with the Government of Indonesia

Support major domestic sea lanes with well-developed ports

through a “hub and feeder model”

HUBS

PORT

5

1

Wholly owned by the Government of Indonesia

2

The Ministry of State-Owned Enterprises appoints Board of Commissioners and Board of Directors

3

Favorable government regulatory support

4

Closely aligned between company’s growth with the _{Government’s strategic plan}

Modernization of facilities and equipment

for the purposes of ensuring adequate

dredging and access channel to support

Panamax vessels and improving the draft of

feeder ports

19

1

4 TOTAL

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6. Robust Financial Profile

23 KEY CREDIT HIGHLIGHTS

Our robust financial profile is supported by strong and stable cash flows and a strong capital structure

Net Revenue (Rp Billions)

EBITDA Margin (%)

NCOA

(1)

(Rp Billions)

(1) Net cash provided by operating activities

Outcome

1 Increase in revenue

2 Improve operating margins

3 Increase cash generating ability

Strategy

Expand our operations:

• Increasing capacity at our existing facilities

• Developing new ports

• Diversifying into other lines of business

Increase the operating efficiency:

• Clustering of services

• Modernizing facilities

Supported by:

1

2 Forecasted positive growth of Indonesia’s economy

Indonesia’s reliance on maritime transport

3,248

Cargo Services Ship Services Other Services

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7. Reputable & experienced board & management

24 KEY CREDIT HIGHLIGHTS

Board of Commissioners

Board of Diretors

Hari Bowo

President Commissioner

• Education: Indonesian Naval Academy

• Previous position: Vice Admiral and Deputy Chief of Staff of the Indonesian Navy • Appointed to Pelindo III BoC in 2014

Zainal Abbidin

Commissioner

• Education: Indonesia Military Academy

• Current position: President Commisioner of PT Kartanegara Energi Perkasa • Appointed to Pelindo III BoC in 2017

Wahju Satrio Utomo

Commissioner

• Education: Trisakti University (Bachelor), University of Indonesia (Masters), University of Indonesia (Doctor)

• Current position: Head of Human Resources Development Division, the Ministry of Transportation

• Appointed to Pelindo III BoC in 2016

Heddy Lugito

Commissioner

• Education: Diponegoro University (Bachelor) • Current position: Editor in Chief Gatra

• Appointed to Pelindo III BoC in 2016

I Gusti Ngurah Askhara Danadiputra

President Director

• Education: Gadjah Mada University (Bachelor), University of Indonesia (Masters) • Previous position: Director of PT Wijaya Karya (Persero)

• >20 years experience

Mohammad Iqbal

Commercial and Operational Director

• Education: University of Diponegoro (Bachelor), Sekolah Tinggi Manajemen (Masters)

• Previous position: CEO PT Samudera Golden Mitra • c.20 years experience

Husein Latief

Engineering & IT Director

• Education: Bandung Institute of Technology (Bachelor), IHE-Delft (Masters) • Previous position: Commercial and Business Development Director, Pelindo III • >25 years experience

Toto Heli Yanto

HR & General Affairs Director

• Education: Merdeka Surabaya University (Bachelor), Airlangga University (Masters) • Previous position: General Manager of Tanjung Perak

• c.19 years experience

U. Saefudin Noer

Finance Director

• Education: University of Indonesia (Bachelor & Masters) • Previous position: Senior Vice President, CIMB Niaga • c.21 years experience

Dedi Syaruf Usman

Commissioner

• Education: Parahyangan University (Bachelor), University of Colorado (Masters) • Current position: Director of Separated State Asset, Ministry of Finance