Company Presentation 9M 2013

(1)

1 PT Toba Bara Sejahtra Tbk ( Toba )

(2)

Disclaimer

These materials have been prepared by PT Toba Bara Sejahtra (the

“Company”)

.

These materials may contain statements that constitute forward-looking statements. These statements

include descriptions regarding the intent, belief or current expectations of the Company or its officers with

respect to the consolidated results of operations and financial condition of the Company. These statements

can be recognized by the use of words such as

“expects,”

“plan,”

“will,”

“estimates,”

“projects,”

“intends,”

or

words of similar meaning. Such forward-looking statements are not guarantees of future performance and

involve risks and uncertainties, and actual results may differ from those in the forward-looking statements

as a result of various factors and assumptions. The Company has no obligation and does not undertake to

revise forward-looking statements to reflect future events or circumstances.

(3)

3 Content

Financial Highlights

2

5 Corporate Profile & Updates

4 Investment Highlights & Growth Strategies

3 Business Overview & Updates

CSR & Environmental Highlights

(4)

Corporate Profile & Updates

(5)

5 Toba specializes in thermal coal production and comprises three operating subsidiaries: Adimitra

Baratama Nusantara (ABN), Indomining (IM) and Trisensa Mineral Utama (TMU), which hold adjacent

concession areas located in East Kalimantan, Indonesia

Toba in Brief

• Substantial and diversified thermal coal

reserves and resources

o

_{JORC-compliant proved and probable reserves of}

147 MM tons and measured, indicated and

inferred resources of 236 MM tons

o

_{Coal brands with calorific values ranging from}

4,700 - 5,800 Kcal / kg GAR

Reserves

%

• Strong growth profile

o

Produced 5.2 MM tons of coal in 2011 and grew to

produce around 5.6 MM tons of coal in 2012

o

_{Prime location provides the operational cost edge to}

grow as a logistical & operational center for the area

o

Continued exploration effort to increase our Reserves and

Resources. Current reserves only account for 52% of our

total area has been explored

Revenue

(1)

Total: 147 MM Tonnes

Total: US$ 443 MM Total: US$ 45 MM Total: 236 MM Tonnes

Note: (1) Last Twelve Month analysis ~ Revenue and EBITDA

(6)

Toba’s coal quality

is in mid-upper

range

Coal Specifications

Calorific Value

(7)

7

Notes:

1. Son of TS founder, Luhut B. Pandjaitan 2. Figures are rounded off

Ownership Structure

•20-year Production Operation Mining Permit ( IUPOP ) expiring in December 2029

•IUPOP was converted from Kuasa Pertambangan ( KP ) in 2009

• IUPOP expires in June 2013 • IUPOP was converted from KP in

2010

• IUPOP extension was completed in March 2013 (First out of 2 extensions: in 2023, with tenor of 10 years each)

•13-year IUPOP expires in December 2023

•IUPOP was converted from a KP in 2010

• Plantation permit expires in 2036

• 2,990 ha • 683 ha • 3,414 ha • 8,633 ha (Right to Use Land)

• Reserves: 117MT- JORC • Resources: 156MT- JORC

• Reserve: 22 MT- JORC • Resources: 37MT- JORC

• Reserves : 8 MT - JORC and additional 7 MT of internal estimate • Resources: 43 MT- JORC

• Planted Area: 2,896 ha

License

Area

Davit Togar Pandjaitan (1) _{PT Bara Makmur Abadi}

PT Toba Sejahtra ( TS ) PT Sinergi Sukses Utama Roby Budi Prakoso

71.8% 0.8% 6.2% 5.1%

PT Toba Bumi Energi ( TBE )

99.99% (2)

3.6%

ABN Minorities

(8)

Majority Shareholder

Toba believes it benefits from Toba

Sejahtra’

s experience in the Indonesian coal sector as well as its

leadership and experience

Controlling Shareholder with Established Track Record…

… Helmed by an Experienced Leader

• A privately owned group founded in 2004 with interests in energy and plantations

• Its business segments are as follow:

–Energy: Owns 5 coal mining concessions through Toba and PT Kutai Energi. All of TS' mines are characterized by low production costs and favorable proximity to ports

–Oil & Gas: In the exploration phase of the 4,567 sq miles South East Madura Block through subsidiary E&P company PT Energi Mineral Langgeng

–Power Plant: Operates a 30 MW coal-fired power plant in Palu, Central Sulawesi and is developing a 120 MW greenfield power plant in Senipah, East Kalimantan

–Agribusiness: A 25% stake in a 12,000 ha palm oil plantation in

• General (Ret.) Luhut B. Pandjaitan is the key shareholder and founder of Toba Sejahtra group. He is currently the chairman of TS • Mr. Luhut had a long and illustrious career in the civic service

before turning to the commercial sector. Over the course of thirty years in the Army Special Forces, Mr. Luhut rose to become a four-star general

– In 1999, Mr. Luhut retired from the military service to serve as Ambassador for the Republic of Indonesia to Singapore

– In 2000, he was appointed Minister of Industry and Trade of the Republic of Indonesia

(9)

9 Initial Public Offering

Listed on IDX

06 July 2012

Number of Shares Offered

210,681,000 shares or 10.47%

IPO Proceed

IDR 400,293,900,000

Anchor Investor

Baring Private Equity Asia (8% at IPO)

(10)

Ticker Code: Toba

In full amount IDR

IPO (6

th

_{Jul 2012)}

IDR 1900

1

st

Nov 2013

IDR 700

Historical Share Price

Sources: Bloomberg

• Decline in TOBA

’s

share price reflects lack of liquidity and lack of stock coverage

2012

2013

(11)

11 2007

• IM commenced

production

2011

• TMU commenced

production

• Toba production

hit 5m tons

2008

• ABN commenced

production

• Operational

adjustment due to

drop in coal

market

2010

• TS acquired the remaining share

for IM from minority shareholder

• Toba acquired 51.0% of ABN,

52.5% of TBE (IM

’

s shareholding

company) and 51.0% of TMU

• Toba production hit 4m tons

Key Milestones

Strong track record of acquisitions, development of greenfield mines, rapid production ramp-up and

experience to adjust operation in a down-market

2007

2008

2009

2010

2011

2012

2013

2012

• Toba acquired the minorities

’

shares in TBE and TMU

• IPO/Listed on IDX, 6

th

_July

2012

• Eliminated overlapping issues

with plantation company (PKU)

2009

• ABN & IM production

reached 2m tons

2013

(12)

(13)

Source: Company data

2007

2008

2009

2010

2011

2012

2013

TMU

Indomining

ABN

13 Solid Operating Track Record (i)

0,8

2,0

3,9

5,3

5,6

Production Growth

MT = Million Tons

• Toba started exploration at ABN & IM in 2006 and at TMU in 2008

• Production grew at 65% CAGR from initial size of 800k in 2008 to 5.6 MT in 2012

• Toba focuses on

Continuous Production Growth

and this is supported by available infrastructure

capacity of

13 MT

of coal

• Additional

3 MT

of capacity is expected to be realized in 3-4Q13 to become total of

16 MT

• Production growth will be driven by TMU and Additional CAPEX will help it fuel growth

ABN IM TMU

Toba is transitioning from Greenfield into growing major player

Fo

re

ca

st

(14)

Toba’s production growth is among the highest in the industry over the

last 4 years

Production Growth Comparison 2009 - 2012

CAGR %

(15)

15 Prime Location Gives Significant Advantage in Cost (i)

Samarinda Mahakam River

Muara Jawa Muara Berau

Makassar Strait

Major City Jetty

Transhipment Point

~55 km

Kutai Energy

Adjacent locations for all

3 mines

Furthest pit to jetty 25km | with closest one ~5km

3

Major city is less than 50

km

4

Close proximity transhipment

point & jetty

2 Toba owns all infrastructures (coal processing plants, overland conveyors, and jetties),

giving

significant operating leverage

vs other concessions in surrounding areas

Prime Location

TMU - IM Hauling Road

(16)

Prime Location Gives Significant Advantage in Cost (ii)

Coal Chain Distance

(a)

In km

Toba’s transportation costs are low due to its close proximity to the

Transhipment Point

Notes : (a) Weighted average distance based on respective production usage of each transportation facility (from pit to vessel) (b) Represent ABN & IM only

Source : Broker Reports

(b)

(17)

29

47 ₄₅

39 71

67

0 10 20 30 40 50 60 70 80

2009 2012

Global Cash Cost Environment &

Indonesia’s Position

Average cash cost prices have moved up by close to 50%...

Lowest Median

Weighted average US$/ton

Prod. Cash Cost by Country (Thermal Coal)

Cash Cost Curve in 2009

Cash Cost Curve in 2012

(18)

Cost Re

du

ction

Cost Reduction Initiatives

ABN

Potential Cost Saving

Up to US$8/ton

(19)

19

Coal Reserves Coal Resources

(MM Tons) Proved Probable

Total

Reserves Measured Indicated Inferred

Total

Reserves and resources upside from conversion of resources to reserves and further exploration of

concession areas

Notes:

1. Differences in totals are due to rounding off

2. The Runge Report for ABN was as of 31 December 2011, the PT SMG Consulting Report for IM was as of 1 January 2012 and the Marston Report for TMU was as of 31 October 2011

Total: 147 MM Tons Total: 236 MM Tons

Substantial Reserves and Resources

Support Production Expansion

(20)

Note: Areas already explored

Substantial Reserves and Resources due to Vast

Unexplored Areas & Relatively Long Reserve Life

• Explored 3,704 of 7,087 hectares of concession areas

(52% of total concession area)

and drilled 3,512

boreholes as of 31 December 2011

• Additional JORC coal reserves and resources

expected to be discovered, especially at TMU where

only 680 hectares out of 3,414 hectares of

TMU

Source : Broker report

Toba’s reserve life of over 20 years compares

favorably with other listed peers

Toba’s Concessions

Reserve life ~ Industry Comparison

ABN

IM

(21)

21 Coal Market Update

Range-bound US$77-95/ton

• Coal Prices have bounced back from high 70

’s

in 2Q 2013 and now on decline trend within

US$ 77-83/ton

• Going forward, prices are expected to trade within range-bound of US77-95/ton

Source: Newcastle Index

2012

2013

Changes in Forward Curve Newc Global Coal Index

Source: Global Coal

Coal Price Trend

70 80 90 100

78,4

81,5

84,5

88,4

91,6

81,7

83,2

86,6

90,3

93,6

95,4

96,7

100,6

105,9

110,2

0 50 100 150 200 250 300 350

(22)

Strong Relationships with Multinational Customers

Major Customers

DRAGON ENERGY GROUP

Major customers provide the stable

business support for

Toba’s

marketing…

…

minimum marketing fees because Toba

handles our own marketing internally

Toba’s

Marketing Operations



Central Marketing Operations of all 3

subsidiaries



Internally developed customer base

that allows Toba to have low marketing

costs



Balance mix of long term contracts,

short term and spot



Active participation in reputable

conference and trade shows to promote

Toba brand

(23)

23 Sales by Destination

Our coal is distributed to

major countries in Asia:

-

China

-

Taiwan

(24)

Business Overview

(25)

25 Manage cash costs: Lower SR,

Shorten Dump Distance

Construct hauling road from

TMU to IM

Share current infrastructures :

CPP & Jetty & lower costs

Centralize fuel supply

Optimize sales through hedging

activities

Increase our reserves through

acquisition and exploration

Strategic Initiatives to Manage Changing Environment

Returning future

Profitability

Level

Strategic Initiatives / Response to Changing Coal Prices

1

2

3

4

5

(26)

Execution and Achievement so far… (I)

Manage Cash Cost: lower SR &

dump distance

OPERATION

Achievement

Execution

Initiative

Construct Hauling Road from

TMU to IM

Share Existing Infrastructure

Mine-plan was adjusted in 3Q12.

Dump distance was lowered despite

pre-stripping in 1Q13 at ABN

Construction commenced end-2012

and was scheduled for completion in

2Q13

TMU commenced using ABN’s road

and IM’s CPP & Jetty

Cash cost is on track to be

lowered ~US$8/t by FY13

Hauling road was completed in

May 2013, ahead of schedule

Production ramp-up at TMU has

been underway since completion

of hauling road. Future

incremental capital cost should be

limited



In Progress

Conduct Joint Mine Plan

Maximizing extraction of ~2 MT

of high quality coal reserve at

low SR

ABN & IM commenced Joint

Border mining end-2012

In Progress

Finalize Capex

Completing Coal Processing Plant

(CPP) at IM to increase production

volume to 6 MT from current capacity

of 3 MT

New CPP has been completed

in end-Sept 13 and is expected

to be officially used by mid- Oct

2013



(27)

Execution and Achievement so far… (I

I)

Provide Financing to IM

FINANCIAL

Optimize Sales through Hedging

Centralize fuel supply

Maximized current ideal capital structure

by using loan to finance new CPP

construction and land compensation

Made available at Toba’s disposal

hedging line of coal with notable

financial institutions

Sourced constant bulk supply from

major fuel supplier to allow for good

monitoring of effective fuel usage

Secured 3-year US$ 15 mn term

loan from SCB at competitive

lending rate of LIBOR + applicable

rate

No hedging facilities has been

utilized. Sold ~72% of 2013 sales

volume using fixed pricing, and

securing cash prepayments



Sourced supply at competitive

price, while continuing to seek

other sources with better pricing

In Progress

Achievement

Execution

(28)

Execution and Achievement so far… (

III)

Secure sales volume in 2013

COMMERCIAL

Achievement

Execution

Initiative

TOBA has successfully sold and

secured ~ 80-90% of targeted sales

volume for 2013

• ABN secured ~ 90% of 2013

targeted sales

• IM secured ~90% of total 2013

targeted sales

• TMU secured 50% prepayment

from one of buyers

Enhance marketing expertise

TOBA negotiated directly with

logistics providers

Internal marketing team currently

handles sales activities

Cost Saving Intiatitives (1)

Lower logistics cost (barging

costs) by 18% from 1Q13 to 2Q13



TOBA eliminated dependency on

third party marketing agent



• ABN & IM are currently in

negotiation with contractors to

discuss further cost reduction

initiatives

Cost Saving Intitiatives (2)

TOBA negotiated directly with

Contractors

In

(29)

…Next: Objectives in

4Q 2013 & 2014

Finalize Capex

OPERATION

Status

Execution

Initiative

Finalizing underpass of ABN by 4Q13

to shorten dump distance range and

to increase efficiency

• Expected to be completed by the

end of 4Q13

COMMERCIAL

Execution

Initiative

Develop and implement Corporate

Social Responsibility

CORPORATE SOCIAL RESPONSIBILITY / ENVIRONMENT

Execution

Initiative

Goal to receive “Proper” mining

awards

for all three mines

Increase cooperation and internal

integration with suppliers

Working together with contractors on

fleet management and supply parts

management with the end providers

Status

Expected to be completed in 2H 2013

Status

(30)

Toba’s Milestone 2013

2007

2008

2009

2010

2011

2012

• Hauling Road TMU

–

IM

completed ahead of

schedule

• TMU Production ready

for ramp up to 80 - 100 K

tons/month

May’13

Sept’13

• New CPP at IM

expected to be

completed

• IM’s capacity

expected to increase

up to 6 MMTPA

operations in new

pit (block 4)

• Border-mining at

ABN & IM

commenced

Jan’13

• IM entered into

new Mining

Contract with

RPP for 5 years

Toba is on track in integrating its operation and infrastructure capabilities

(31)

31 Integration of three

(3) mines

• Benchmarking and sharing between departments and functions

• Optimize and coordinate mine planning and logistics

• Centrally coordinate and streamline corporate finance, legal, human resource and CSR functions

• Joint mine plan and infrastructure sharing

1 Increase coal reserve

and resource

• Continue exploration activities to increase proven and probable reserves as only 52% has been explored to JORC standard

• Consider opportunities to acquire coal

concessions with significant reserves

3 Strengthen existing

and develop new

customer

relationships

• Supply a higher proportion of sales volume to end users, while maintaining relationships with existing coal traders

• Target customers in Japan, Taiwan, South Korea, China, Vietnam and Hong Kong, South East Asia and India

4 Continue to focus on

health and safety,

environmental track

record and

commitment to CSR

• Maintain and enhance high international operating standards, utilize automated mining methods to minimize accidents and enhance safety

• Foster community ties through development programs as well as job creation

5 Organically increase

coal production levels

• Expand coal production through increased production and mine development activities

• Strengthen

relationships with third party mining

contractors and work closely with them to improve their productivity

2 Toba’s

Business Strategies

(32)

1.097 1.373 1.574 1.587 1.287 1.501 1.802

1Q 2012 2Q 2012 3Q 2012 4Q 2012 1Q2013 2Q2013 3Q'13

Production volume Stripping Ratio (SR)

Toba’s Operational Performance in 3Q

2013

Quarterly Production & Stripping Ratio (SR)

Thousand Tons

Production Summary

MMT: Million Metric Ton

2Q13

3Q13

Change

Comment

Production

(MMT)

1.5

1.8

1.4

1.6 17.8%

Sales volume in 3Q13 was higher than in 2Q13 mainly

_{due to significant production ramp-up in TMU}

20.0%

Q-o-Q production in 3Q13 increased by 20.0% to 1.8

MMT, which was the highest volume booked by Toba

throughout its corporate history

Sales

(MMT)

• Production volume of 4.6

MMT YTD September (9M

2013) was 75.4% of our FY

2013 production target

• To achieve FY target of

5.8-6.4MMT,

TMU

is

expected

to

be

instrumental in boosting

overall

growth

via

(33)

Dump

distance 2,492 2,461 1,978 1,723 1,719 1,864 1,843

33 ABN Operational Performance

Production & Stripping Ratio

Thousand Tons

 ABN managed to increase production by 19% from 2Q13 to 3Q13

 ABN’s 2nd_{underpass is currently under construction and expected}

to be completed by 4Q13 with aim to lower OB dump distance

 At 12.7x SR, for every 100 meter-decrease in dump distance is expected to reduce cost by~US$0.65/ton, contributing to ~US$ 3.9/ton in FOB cash cost saving since 3Q12

Operational Advantage & Focus

Short coal hauling

distance 4km Cap 10 mm ton/year High Built Crusher

Barge Loading Jetty Loading Speed of up to

1,800 ton/hour

Under-pass: Capitalizing on Infra

Strength

PT Kutai Energi

884 1.078 1.224 1.225 925 995 1.188

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

(34)

Dump

distance 1,693 2,740 2,136 2,284 1,698 1,662 1,728

IM Operational Performance



IM

’s

production in 3Q13 decreased by 5.8% q-o-q due mainly to

higher-than-expected rainfall



On y-o-y basis, dump distance fell by ~400m, falling by 19%



At 13-14x SR, for every 100 meter-decrease in dump distance is

expected to reduce cost by~US$0.82/ton, translating to y-o-y

FOB cost saving of ~US$ 3.3/ton

Key Highlights

Production & Stripping Ratio

Thousand Tons

Operational Advantage & Focus

1

2

3

4 TMU

ABN

PT Kutai Energi

190 236 265 272 278 360 339

(35)

32 34

Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13

TMU Coal Production (ktons)

35 TMU Operational Performance

Key Highlights

Production & Stripping Ratio

Thousand Tons

Operational Advantage & Focus

 TMU’s production in 3Q13 increased by 88% q-o-q, mainly due to strong contribution from recently-opened Block 4

 TMU’s hauling road to IM was completed ahead of schedule in end-May 2013. To date, IM has been using IM’s CPP and jetty facilities for coal shipment

 In September 2013, production reached 109,000 tons/month, rising 291% from 32,000 tons/month in January 2013. This level of productivity is expected to be maintained for the rest of year

16-17km Hauling Road to ABN is completed

Integrate CPP Ops with IM Mine operations

commenced at Block 4

1

2

3 ABN

IM

PT Kutai Energi

Note:

- - -

Hauling road

(36)

Financial Highlights

(37)

TOBA 1Q 2013 2Q 2013 3Q 2013 YTD 2013 Change %

Per Ton Basis

ASP US$/ton 66.4 68.1 67.8 67.4 0%

Net Income before Minority

Interest US$'M 6.0 6.6 7.0 19.6 6%

Ratio

Gross Profit Margin % 15.2% 17.9% 19.9% 17.7% 11%

EBITDA Margin % 10.0% 13.4% 16.6% 13.5% 24%

Operating Profit Margin % 8.2% 10.8% 10.5% 9.9% -3%

37 Financial Performance YTD 9M 2013

• In 3Q13

, SR was

lowered by 7%

, while

production increased

by 20%

...

• …resulting in

9%

decline in adj FOB

Vessel cash cost

• ASP slightly

rose by 0.4

% despite 9% Q-o-Q

fall in NEWC Index

…

Notes (a) FOB vessel cash costs: COGS, Selling Expenses, Royalty,excluding depreciation fixed assets and amortization of exploration and development

(b) Adj. FOB vessel cash costs: COGS, Selling Expenses, Royalty excluding depreciation fixed asset and amortization of exploration and development asset & without accounting for component of deferred striping cost

• …

EBITDA and Net

Income increased by

46% and 6%

respectively

1

2

(38)

38 Financial Performance

–

YTD 2013 vs YTD 2012



Coal production grew 13% (yoy)

driven by TMU production

ramp-up

(a)



Hence, EBITDA increased by

78% attributable to lower Cash

Cost and Increased Production

by -16% and 13% respectively



Toba’s 9M13 production achieved

75% of 2013 based on mid

production target of 5.8-6.4

million tons



FOB vessel cash cost slashed by

16% yoy mainly due to lower

mining costs (lowered SR and

shortened dump distance)

YTD 2012

YTD 2013

Change %

Operation

Sales Volume

mton

3.7

4.4 20%

Coal production

mton

4.0

4.6 13%

Stripping Ratio

x

16.0

13.7 -14%

NEWC Index

US$/ton

100.1

85.7 -14%

Per Ton Basis

ASP

US$/ton

77.1

67.4 -13%

Net Income before Minority

Interest

US$'M

15.9

19.7 24%

Ratio

Gross Profit Margin

%

14.4%

17.7%

23%

EBITDA Margin

%

8.0%

13.5%

69%

(39)

39 Evolution of FOB Vessel Cash Cost

on Quarterly Basis

ABN

IM

3Q 2013

2Q 2012

3Q 2012

4Q 2012

Adj. FOB vessel

cash cost

(b)

_US$73/ton

_US$64/ton

_US$51/ton

US$50/ton

US$64/ton

US$49/ton

SR

17,1x

14,7x

12,6x

12,7x

Notes (a) FOB vessel cash costs: COGS, Selling Expenses, Royalty,excluding depreciation fixed assets and amortization of exploration and development

(b) Adj. FOB vessel cash costs: COGS, Selling Expenses, Royalty excluding depreciation fixed asset and amortization of exploration and development asset & without accounting for component of deferred striping cost

FOB vessel

cash cost

(a)

US$68/ton

US$61/ton

US$56/ton

US$57/ton

US$60/ton

US$71/ton

US$57/ton

Adj. FOB vessel

cash cost

(b)

SR

FOB vessel

cash cost

(a)

TMU

Adj. FOB vessel

cash cost

(b)

SR

FOB vessel

cash cost

(a)

US$69/ton

US$64/ton

US$38/ton

US$56/ton

US$41/ton

US$64/ton

US$52/ton

(40)

Source (a) Broker Report (September 2013)

Toba’s Cash Costs Comparisons

• TOBA can operate on higher SR

relative to peers mainly due to

lower transportations costs from

location advantages

Cash Cost

(a)

US$/ton

• On this chart, FOB Vessel Cash

Cost calculation excludes

marketing fees, in which case

HRUM and ITMG paid

significant amounts

(41)

41 Balance Sheet

• Total Assets as per June 2013

increased by 11% from December

2012

• Cash and cash equivalent rose by

25% compared to December 2012

• Shareholders Equity surged by 10%

from December 2012 to September

2013, reflecting positive growth return

Balance Sheet

US$’000

Despite decreasing trend in coal index

price, total assets grew through stronger

equity base

Dec-12

Sep-13

_{(Sep13 - Dec'12)}Movement

Cash and cash equivalents

36,307

45,470

25%

Total Net debt/Equity

44%

25%

114

(42)

Debt and Cash Position

Net Debt Position

US$ Mn

2%

34%

6%

11%

Net Cash

3%

11%

Net Debt to

Equity

34

16

39

36

60

53

46

35 35

44

49

43

56 59

0 10 20 30 40 50 60 70

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

(43)

Sep-12

Sep-13

Cash Generated from Operation

18,393

33,682

Income Tax Payment

(46,338)

(7,136)

Interest income/expenses

(1,419)

(937)

Cash flow from Operation

(29,364)

25,610

Cash flow from Investment

(125,145)

(176)

Cash flow from Financing

135,203

(10,972)

Movement in cash flow

(19,306)

14,461

Change in Cash due to forex

-

(5,299)

Beginning Cash

58,573

36,307

Ending Cash

39,267

45,470

43 Strong Cash Flow Generation

• During current volatile coal market, Toba

decided to predominantly enter into fixed

price contracts with buyers, while

securing sales on cash prepayment

basis

• Positive cash position increased by 83%

from US$ 18 mn in 9M 2012 to US$

33mn in 9M 2013 mainly due to

prepayment and lower SR

Cash Flow Statements

US$’000

Extraordinary transaction:

Significant CF from Investment

(44)

CSR & Environmental Highlights

(45)

45

• Toba is continuously developing and implementing its corporate social responsibility programs

–

Creating educational opportunities for local communities including renovating schools, training teachers,

providing post-graduate educational assistance and creating a literacy program for adults and a scholarship

program for school-aged children

–

Providing health services to the local communities

–

Helping groups of farmers plant crops of vegetables and bamboo and assisting with land rehabilitation

–

Creating local employment opportunities by sourcing some of the

Company’s

site workforce from the

neighboring areas

Helping Farmers Plant Crops

Creating Educational Opportunities

Providing Health Services

(46)

2007

2008

2009

2010

2

0

1

1 Target

PROPER Mining Award for

ABN, IM, & TMU

Award and Recognition

ABN

East Kalimantan

PROPER Green

Mining Award

2012

2014

2011

Ernst and Young

Social

Entrepreneur of

the Year 2011

2013

Indomining

East Kalimantan

PROPER Blue

Mining Award

PT Toba Bara Sejahtra Tbk

Ranks as

one of Indonesia’s Top

50 companies

(47)

(48)

• Current production capacity (31 December 2012): – Crusher: 10 MM tonnes p.a.

– Conveyor: 10 MM tonnes p.a.

• Produces two varieties of blended thermal coal – ABN 52: Marketed CV(1)_{of 5,200 kcal / kg GAR} – ABN 55: Marketed CVof 5,500 kcal / kg GAR – ABN 58 : Marketed CVof 5,800 kcal / kg GAR • Substantially all of the owners of the land within ABN’s

concession area have been compensated and ABN has been granted the exclusive right to mine those areas

• Area: 2,990 ha

• Location: Sanga-Sanga, Kutai Kartanegara, East Kalimantan • Type of license: IUPOP

• Expiry date: 1 December 2029

• Commencement of production: September 2008 • 2012 production: 4.4 MM tonnes

• Mining consultant: PT Runge Indonesia

ABN: Coal Concession Overview

IM

TMU

ABN Jetty

ABN

Overview

Operations

Marketing

• Historically sold between 50%-100% of its annual production through long-term (longer than 1 year) with coal trading companies

– The remainder were sold on the spot market

(49)

49

• Current production capacity (31 December 2012): – Crusher: 3.0 MM tonnes p.a.

– Conveyor: 4.5 MM tonnes p.a.

• Produced one variety of blended thermal coal “Indomining” with marketed CV(1)_{of 5,700 kcal / kg GAR in 2012}

– May produce additional varieties of blended thermal coal in the future

• Has compensated the majority all of the owners of the land within its concession area for their land and has been granted the exclusive right to mine those areas

• Area: 683 ha

• Location: Sanga-Sanga, Kutai Kartanegara, East Kalimantan • Type of license: IUPOP

• Expiry date: IUPOP effective until 2023 and can be renewed for another 10 years

• Production commencement: August 2007 • 2012 production: 1 MM tonnes

• Mining consultant: PT SMG Consultants

IM: Coal Concession Overview

IM

TMU

Overview

Operations

Marketing

• Historically sold approximately 50% of its annual production through short-term (one year or shorter) contracts with coal trading companies – Clients include Glencore, Flame, Peabody, Dragon, Aempire • The remainder are sold on the spot market

• Currently, IM sells coal to buyers based on fixed priced contracts up to one year, backed with pre-determined cash prepayments