MANAGEMENT PRESENTATION FINANCIAL STATEMENTS 30 SEPTEMBER 2017 2 - PowerPoint PPT Presentation

MANAGEMENT PRESENTATION FINANCIAL STATEMENTS 30 SEPTEMBER 2017

2 TABLE OF CONTENTS Company Overview Business Overview Strategy & Projection in 2017 & 2018 Performance 9M 2017

3 COMPANY OVERVIEW • A Leader in Southeast Asia’s Textile Industry 1 • Vertically Textile and Garment Company 2 • Strategic Locations 3 • Milestones 4 • Board of Commisioners and Directors 5 • Company Structure 6

A LEADER in SOUTHEAST ASIA’s 4 TEXTILE INDUSTRY PT Sri Rejeki Isman Tbk (“ Sritex “) is one of the largest vertically integrated textile companies in SE Asia, with operations across Spinning, Weaving, Finishing and Garment Manufacturing, located in Central Java, Indonesia. COMPANY OVERVIEW  One of the largest vertically-integrated textile garment companies in SE Asia.  Established by the Lukminto family with history dating back to 1966; headquarter in Sukoharjo, Central Java, Indonesia.  Product portfolio comprises yarn, greige, fabric, as well as military and corporate uniform and fashion clothing.  Strong and diversified customer base with presence in over 100 countries.  Strong reputation with numerous awards and accreditations; ISO 9001 & ISO 14001 Certified Company  Listed on the Indonesia Stock Exchange since June 2013 SPINNING WEAVING FINISHING GARMENT Capacity 27 million Capacity 654,000 Capacity 180 million Capacity 240 million pieces/year bales/year metre/year yards/year

5 VERTICALLY TEXTILE & GARMENT COMPANY UPSTREAM MIDSTREAM DOWNSTREAM RETAIL RAW MATERIAL GREIGE DYED FABRIC APPAREL YARN 60% RAYON SPINNING WEAVING FINISHING GARMENT 20% 20% COTTON WORLDWIDE 20% POLYSTER CAPACITY CAPACITY CAPACITY CAPACITY 180 Mn Meters/Year 240 Mn Yards/Year 27 Mn Pieces/Year 654.000 Bales/Year 65%-70% 15%-20% 100% 60%-70% SOLD OUTSIDE SOLD OUTSIDE SOLD OUTSIDE SOLD OUTSIDE Four main production processes of Sritex: Spinning, Weaving, Fabric Finishing and Garment are vital to the integration of the Company’s Business.

STRATEGIC LOCATIONS 6 SPD: Area~18ha Tanjung Emas International Port, Semarang BItraTex Primayudha Mandiri Jaya Sritex 2: Central Java, Indonesia Area~19ha Total Area ~ 79ha Total Population: 35 Million peoples Sritex 1: Area~42ha Production facilities situated in a region with heavy Unique competitive advantage through offering its customers integrated solutions focus on textiles and close proximity to low-cost and supported by economic of scale, consistent high quality, shorter lead times, skilled workforce. And 2 hours to international port. enhanced operational and cost efficiency, leading to competitive pricing policies.

7 MILESTONES Present 2015 “Our company is growing rapidly from • President of the Republic Indonesia • Award from the inaugurated the Expansion New PT Sri Rejeki Factory of PT. Sri Rejeki Isman Tbk on year to year with a strong Fundamental Indonesian World Records Isman Tbk April 21, 2017. Museum with the officially • Best Liability Management – Asset category of “Pioneer and and continuous expansion” listed its Asian Award 2016 by Triple A. Organizer of the • The Top 50 Company For 2016 – initial shares Creation of the Largest Achieved Best of the Best Awards, Forbes (with ticker Share Investors within a vertical Became Indonesia. code SRIL) on Company” integration a military • Rank-1 For Textile and Garment the Indonesia • Intellectual Property and uniform Group – Economic Review. Stock Rights Award in the expanded • Rank A For Best GCG 2016 – supplier Exchange category of IP Enterprise Established production Economic Review for . Trophy by Sritex from 2013 the first capacity to 4 • Top Ten Blue as one of the best IDX NATO WIPO (World Intellectual finishing Registered Iwan S. Lukminto business Listed Company – 2016 and the Property Organization). at the began to engage in plant Established • Best Enterprise Achievers 2016 for segments: German • Awarded “Top Ministry of a leadership role. that Local Giants category from Spinning, weaving army. Performing Listed Industry 1997 Obsession Media Group . produces Weaving, factory 1994 Companies in Textile and and finished Finishing , with 1,000 Garment Sector ” from fabric established Garment weaving Investor Magazine Founded by H.M. as a limited and 1992 machines Lukminto as a liability whitening 1982 traditional company materials trading company (putihan) in 1978 in Pasar Klewer, Solo. Solo. The textile 1968 center market in central java 1966

BOARD OF COMMISIONERS AND DIRECTORS 7 8 BOARD OF COMMISIONERS BOARD OF DIRECTORS

9 COMPANY STRUCTURE AFTER NON PRE-EMPTIVE RIGHT FOUNDER PT HUDDLESTON PUBLIC *) SHARES INDONESIA 0.04% 60.06% 39.90% PT SRI REJEKI ISMAN TBK (SRIL-ID) 99.90% PT SINAR PANTJA DJAJA Indonesia Singapore 100.00% GOLDEN LEGACY PTE LTD 100.00% GOLDEN MOUNTAIN TEXTILE AND TRADING PTE LTD

10 BUSINESS OVERVIEW • Customers 1 • Competitors 2 • Textile Industry Overview 3

11 CUSTOMERS “ Sritex has a broad and diversified network of customers both domestic and international level” YARN Sritex is a major supplier of high quality yarn for major textile customers globally. SPINNING GREIGE Sritex greige or raw fabric is renowned for its excellent standard and high quality. WEAVING

12 FABRIC Sritex high-quality fabric is both extremely Pan Brothers Tbk comfortable and classy. It is a reputable brand within a competitive fashion industry. FINISHING

13 Garment Uniform - Military Uniform - Corporate Fashion Sritex is a leading partner in supplying Sritex’s flexibility allows penetration into Sritex also manufactures uniforms for military uniforms to more than 30 the international fashion market, with Indonesian companies, for work-wear countries since 1993 and has become many leading international players as its international companies and also uniforms supplier for German militatry uniform with clients for government agencies high specification. TJ Max Buffalo LC Waikiki RnB Martha Steward Vintage American Maxx Splash Hybrid Hanes Le Paul Ambler IMIP Champion Nodstorm New Yorker Ready Care United Tractor SAJ Ross Kohl’s Guess Target PPUM IGM Hospital OZ Fashion Express Forever 21 El-Zatta Swarna Propan Pelindo Planet Surf Volcom Syaf Co Rip Curl

COMPETITORS 14 “Relative to its domestic competitor. Sritex is the market leader with 9M 2017 US$ 573 Million” Sritex is in a fairly competitive position within the textile industry in Indonesia. According to the Indonesian Textile Association ("API"), the textile industry in Indonesia is still fragmented with 2,930 textile companies in 2014. According to the Ministry of Industry Indonesia, about 2,600 textile companies are still using machines older than 20 years, companies using newer machines are considered to have a greater competitive advantage and Sritex is one of the few companies that does. COMPETITOR PRODUCT COUNTRY SALES COMPETITOR PRODUCT COUNTRY SALES 9M 2017 9M 2017 Million USD Million USD Yarn, Fabric India 705 Vardhman Textiles Ltd Indonesia Greige, and 26,21 PT. Ever Shine Tex Tbk (ESTI) Fabric Knitwear China 1,304 (1H Shenzhou Int. Group 2017) PT. Pan Brothers Tbk Garment Indonesia 241,65 (1H Yarn China 1.176 (1H (PBRX) TEXHONG Textile 2017) 2017) Garment Taiwan 734 (1Q 2017) Makalot Industrial Co Ltd Garment India 895 Arvind Limited Knitwear Taiwan 922 Eclat Textile Co. Ltd Competitor Military Uniform (Domestic) : PT. APAC Inti Corpora (Bawen-SMG), PT. Mulia Knitting (Kalideres-JKT), PT. Daya Mekar Teksindo (Batu Jajar-West Java), PT. Yuntex (Bandung-West Java), and PT. Bhinneka Karya Manunggal (Karawang). Competitor Military Uniform (International) : Iturri (Spain), Fecca (Spain), Saintex (Belgium), Cooneen Watts & Stone (UK), Vaife (Holland), Kwintet Sverige (Holland), Oskar Pederson (Norway), and Sari Leo Mihob (France).

15 TEXTILE INDUSTRY OVERVIEW “With the rising labor cost in China and labor issues in Bangladesh, Indonesia now becoming more favorable place for investment” Sales By Geographical Area Sales By Geographical Area Textile Export Market Share in 2016 9M 2016 9M 2017 Market Share Global Market Share China America, Europe, America, Europe, Singapura 30% 8% 9% 6% 8% 4% Kamboja 9% UAE & Vietnam UAE & Africa, 30% India Africa, Australia, 6% Row Malaysia Australia, 4% 22% 12% 3% Asia, 33% Domestik, SEA 47% Thailand Asia, 32% 9% 15% Domestik, Japan USA Germany 2% 50% Pakistan 5% 5% Turkey Indonesia 3% 4% 30% Hong Kong Italy Taiwan 3% Korea 4% 3% 4% Regional Minimum Wage Comparisons Between Countries in 2017 Indonesian Textile Exports 2003-2016 2017 minimum monthly wages of comparison countries Source : Trading Economics DAILY MIN WAGE MONTHLY MIN WAGE COUNTRY (US$) (US$) 6,92 – 7,52 207,49 – 230,33 Malaysia Thailand 8,50 259,52 7.7 4.84 – 10,61 101 – 333,ô China 4.1 4.8 4.5 4.6 5.2 6.0 2.87 – 7,74 86.14 – 232,19 Indonesia – – Sukoharjo 113,33 2.9 3.0 3.4 3.6 3.8 3.7 3.2 4,52 – 5,10 136,51 – 153,11 Vietnam 3.15 – 3,79 94,64 – 113,56 Pakistan Bangladesh 2.19 68 Cambodia 4.67 140,00 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 (a) 2017 minimum wage of Rp. 1,513,000 converted at IDR/USD = 13,351