PT DELTA DUNIA MAKMUR Tbk Investor Presentation | October 2013 - PowerPoint PPT Presentation

PT DELTA DUNIA MAKMUR Tbk Investor Presentation | October 2013

Overview

Delta Overview Shareholding Structure Share Data Bloomberg Ticker Public DOID.IJ NTP Ltd (1) Reuters Ticker Shareholders DOID.JK Shares Outstanding 39.96% 60.04% 8,216,846,232 Free Float 60.04% Share Price (As of 31 October 2013) 100% (2) Rp87 Market Capitalization (3) US$64 million Notes: 1.Northstar Tambang Persada Ltd., a company owned by a consortium of investors consisting of affiliates/nominated investment vehicles of TPG Capital, Government of Singapore Investment Corporation, China Investment Corporation and Northstar Equity Partners 2.Less one share as required by Indonesian company regulations 3.Based on an exchange rate of Rp.11,234 = US$1.00 Source: Company data and Bloomberg 3

Management Key Focus Areas Free cash Flow. The primary financial focus of BUMA with objective to create and hold cash. � Account Receivables : Past due ARs peaked in Q4 2012. Management has a focused calling plan on every � customer that has past due ARs. All accounts are moving in the right direction – will be FCF accretive in 2013 CAPEX : Management has cancelled or reallocated most CAPEX for this year. CAPEX number will be reduce � by 80%-90% against 2012 (may change due to new contracts). 2011 cash capex was US$220 million and 2012 was US$ 256 million People Efficiency : Management is taking difficult human resource decisions through right sizing process. � Cost Reduction : Management is driving efficiency across all operations (example: fuel, drill & blast, tire, rental, � park equipment) Customer Optimization. Management is reviewing every contract to assure long term mutually beneficial � partnership Operational Excellence. Management continues to drive excellence in operational executions � Business Excellence (BE): To deliver improvement initiatives and institutionalize operational excellence � BUMA Management Systems (BMS) : Institutionalize operational excellence with system and process � BUMAnisasi : Institutionalize operational excellence behavior through leadership, welfare, training and � development programs. 4

BUMA’s Existing Contracts Kalimantan Berau - Lati No Customers Period Berau - 1 Adaro (Tutupan) 2009-2013 Binungan 2 Adaro – Coal Hauling 2009-2013 Berau - Suaran 3 Kideco (Extension) 2004-2019 4 Berau Coal (Lati) 1998-2018 Bayan – GBP 5 Berau Coal (Suaran) 2003-2018 Pontianak Bayan - PIK Kideco 6 Berau Coal (Binungan) 2003-2018 Samarinda Lanna 7 Lanna Harita Indonesia 2001-2013 Adaro Balikpapan 8 Bayan - PIK 2007-2017 Arutmin KPC 9 Bayan - GBP 2007-2017 Banjarmasin 10 Arutmin (Senakin Pits 4-7) 2010-2014 11 KPC (Elang) 2011-2016 Contract Underwriting Criteria Coal Marketability � – Coal Quality must meet minimum requirements Customer Requirements � – Shareholder reliability / sufficient risk mitigates – Significant reserves – Low operating costs Profitability of Contract � – Specified minimum return – Contract duration 5

Production Track Record OVERBURDEN REMOVAL VOLUME COAL GETTING (mn bcm) (mn tons) 348.1 36.4 334.1 34.7 34.5 -14% 35.0 32.8 292.3 277.7 -2% 264.3 262.1 25.0 227.9 24.5 2008 2009 2010 2011 2012 9H12 9H13 2008 2009 2010 2011 2012 9M12 9M13 COAL HAULING IMPLIED STRIPPING RATIO (mn tons) (x) -12% 10.6 10.1 12.9 9.6 9.3 12.2 12.4 +29% 11.5 8.5 10.6 8.3 9.9 7.2 7.6 2008 2009 2010 2011 2012 9M12 9M13 2008 2009 2010 2011 2012 9M 12 9M 13 6

Monthly Production Trend Coal OB Removal Stripping Ratio 11.4 11.0 10.8 10.8 10.5 10.4 10.6 10.6 10.6 10.2 10.1 10.0 10.0 9.9 9.8 9.6 9.6 9.5 9.6 9.3 9.5 9.3 9.5 9.4 9.3 9.2 9.2 9.0 8.7 8.9 8.6 8.5 8.2 33.5 33.3 31.5 32.4 32.1 31.2 31.4 31.0 29.7 28.1 28.9 29.3 27.8 27.8 27.7 26.5 26.0 25.8 25.0 23.8 26.3 25.2 25.0 25.8 27.8 27.6 23.3 25.4 26.3 26 25.1 23.0 20.8 2.6 2.5 2.6 2.7 2.8 3.3 3.4 2.8 3.0 3.3 3.1 2.7 2.5 2.2 2.6 2.8 2.8 3.1 3.2 2.8 3.1 3.2 3.2 3.1 2.5 2.3 2.7 2.5 2.8 2.9 2.8 2.9 3.1 7

BUMA’s Financial Highlights NET REVENUE EXCL. FUEL EBITDA (US$ mn) (US$ mn) 241 240 740 227 684 202 -10% 199 -16% 179 580 546 504 487 489 151 2008 2009 2010 2011 2012 9M 12 9M 13 2008 2009 2010 2011 2012 9M12 9M13 EBITDA MARGIN* CAPITAL EXPENDITURES (%) (US$ mn) 256 40.9 40.0 239 39.1 220 35.1 32.8 32.6 209 31.0 95 75 17 2008 2009 2010 2011 2012 9M12 9M13 2008 2009 2010 2011 2012 9M12 9M 13 8 * EBITDA to net revenue excl. fuel

9M 2013 Financial Results

Interim Production Results OVERBURDEN REMOVAL (1) COAL COAL HAULING (mn bcm) (mn tons) (mn tons) 2011 2012 2013 2011 2012 2013 2011 2012 2013 3.6 3.6 98 9.6 9.5 93 3.2 9.1 89 9.0 8.8 3.1 86 8.6 3.0 8.5 3.0 84 8.2 2.8 80 80 79 8.0 77 2.7 75 7.5 7.3 70 2.4 2.4 2.2 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q During Q3 2013, OB removal production declined by 1% QoQ (-20% YoY) to 78.7mn bcm while coal � production grew by 8% QoQ (down 3%YoY) to 8.8mn tons. OB removal production declined by 14% YoY to 228mn bcm during 9M 2013 while coal production � remained flat at 24.5mn tons, translating to a strip ratio of 9.3x in 9M 2013 versus 10.6x in 9M 2012. Coal hauling volume increased by 29%YoY to 9.9mn tons in 9M 2013. The average hauling distance for overburden remained relatively flat at 2.36 km versus 2.40 km in 9M � 2012. On a quarterly basis, the average hauling distance increased by 5% QoQ to 2.48 km in Q3 2013. Top four customers :Berau Coal, Kideco, Adaro and Bayan Group contributed 78% to overburden and coal � production in 9M 2013 vs. 79% in 9M 2012. 10

Delta / BUMA – Key Financial Highlights (1) � Reporting Currency. Delta and BUMA changed the reporting currency from Rupiah to its functional currency, US Dollars, starting from the FY 2012 audited financial report. � Depreciation Policy. With effect from January 1, 2013, BUMA adopted a straight-line method for commercial/accounting depreciation policy to be in-line with the industry standard. BUMA Key Highlights: Net revenue (excl. fuel) declined by 10%YoY to US$489 million in 9M 2013 on lower volume. � EBITDA declined by 16% YoY to US$151 million in 9M 2013 as fixed costs can not adjust as quickly as customer � volumes. EBITDA margin to net revenue contracted to 31% versus 32.8% in 9M 2012 and 32.1% in 4Q 2012. � Management continues to put persistent focus on cost reduction. BUMA significantly scaled back capital expenditures during 9M 2013 to US$17mn versus US$239 million � spent in 9M 2012. Around 68% was for replacement capex, 21% for infrastructure at mine sites and others made up the balance. Depreciation expenses amounted to US$90.5 million (down 30%YoY) T otal debt as of the end of Sept 2013 was US$904 million versus US$927 million in December 2012. � Delta Key Highlights: Delta 9M 2013 consolidated EBITDA was at US$150 million � Total consolidated net debt as of the end of September 2013 was US$716 million � We posted a net loss of US$13 million in 9M 2013 � 11

Delta / BUMA – Key Financial Highlights (2) Delta’s Consolidated Balance Sheet BUMA’s Balance Sheet In US$ mn Dec-12 Sep-13 YTD In US$ mn Dec-12 Sep-13 YTD Cash and cash equivalent 57 200 251% Cash 4 152 3563% Trade receivable 235 163 -31% Trade receivable 235 163 -31% Other current assets 94 102 8% Other current assets 86 100 17% Fixed assets - net 598 515 -14% Receivables related party 253 260 3% -14% Other non-current assets 176 140 -21% Fixed assets - net 592 511 Other non-current assets 152 110 -28% TOTAL ASSETS 1,160 1,119 -4% TOTAL ASSETS 1,323 1,296 -2% ST loan 2 50 2400% ST Loan 2 50 2400% Trade payable 75 68 -9% Trade payable 75 68 -9% LT debt - current 98 132 35% LT debt - current 98 132 35% Derivative liabilities-current 11 11 2% Derivative liabilities-current 11 11 4% Other current liabilities 20 27 35% Other current liabilities 20 27 37% LT debt - non current 827 722 -13% LT debt 827 722 -13% Derivative liabilities 21 12 -41% Derivative liabilities 21 12 -42% Other non-current liabilities 16 14 -11% Other non-current liabilities 12 10 -14% TOTAL LIABILITIES 1,070 1,036 -3% TOTAL LIABILITIES 1,066 1,033 -3% TOTAL EQUITY 90 83 -7% TOTAL EQUITY 257 263 2% *) Restatement were done in compliance with revised PSAK 1, effective Jan 1, 2011 - to adopt the revised PSAK 10, effective Jan 1, 2012 - USD is now the functional and presentation currency Delta’s Consolidated Profit and Loss BUMA’s Profit and Loss In US$ mn 9M12 *) 9M13 YoY In US$ mn 9M12 *) 9M13 YoY Net revenues 628 541 -14% Net revenue 628 541 -14% Revenue excl. fuel 546 489 -10% Revenue excl. fuel 546 489 -10% Gross profit Gross profit 76 88 77 90 17% 16% Operating income 44 56 Operating Income 48 59 28% 23% EBITDA 177 150 -15% EBITDA 179 151 -16% Pretax loss (11) (13) Pretax profit 5 1 19% -72% Net profit 8 0 -99% Net loss (8) (13) 57% 12