PT AKR Corporindo Tbk. Delivering Positive Growth. Corporate Presentation October 2013

Transcription

1 PT AKR Corporindo Tbk Delivering Positive Growth Corporate Presentation October 2013

2 Agenda I. Corporate Information II. Financial Performance III. Business Segments Review - Basic Chemicals - Petroleum Distribution - Logistics IV. Integrated Industrial Port Project (JIIPE) 2

3 I. Corporate Information 3

4 Milestones of Corporate Growth Chemical trading business founded Building storage tank facilities in several ports Listed on Indonesia Stock Exchange First national private company to import and distribute non subsidized fuel First private company awarded distribution of subsidised fuel Divestment of manufacturing subsidiary company PT Sorini Agro Asia Corporindo Tbk Maiden issuance of Bond for industrial port project 2013 Launching of Integrated Industrial Port Project at Gresik - East Java, Joint Venture with Pelindo III Future PT AKR Corporindo Tbk become comprehensive Infrastructure Logistic Company and Energy Distribution 4

5 Integrated Logistic & Supply Chain Business - Delivering Sustainable Growth in Future Basic Chemicals Petroleum Logistics Industrial Port Trading and distribution of basic chemicals, a business that grows with demand for raw materials of consumer goods in Indonesia Distribution of fuel to industries, mining & power plants (nonsubsidized) and growth opportunities in retail (subsidised) in Indonesia A comprehensive logistics and supply chain networks in Indonesia and China, comprising port, warehouses, storage tank terminals and transportation units Java Integrated Industrial and Ports Estate, a project that intregrates deep sea port and industrial estate into one package Energy Distribution Integrated Infrastructure Logistics 5

6 Extensive Supply Chain Network Ports Indonesia 19 China 5 Capacity 100% Own Use (Distribution) JV Independent Tank Terminal Additional Capacity (2013) Total Capacity (2013) Tank Terminals Petroleum 200, ,000 70, ,000 Petroleum 450,000 KL Chemical 100, , ,000 Chemicals 100,000 KL Total 300, , , ,000 SPOB/Vessels Warehouses Trucks Retail Petrol Stations 8 Units 25 Units 250 Units 50 Units JTT the largest tank terminal at Jakarta 6

7 II. Financial Performance 7

8 Strong Growth Financial Performance Sales and Revenues (IDR billion) Gross Profit (IDR billion) 21,674 1,261 18,806 1,052 10,321 10, , H H13 Income from Operations (IDR billion) Net Income (IDR billion) H H13 * Excluding extraordinary gain from divestment of Rp 1, billion * 8

9 Strong Balance Sheet For Future Growth Consolidated Balance Sheet (IDR billion) Jun-13 Dec-12 Current assets 6, ,414.6 Cash 1, ,884.9 Trade receivables 3, ,166.2 Inventories 1, ,415.2 prepaid tax Other current assets Non-current assets 5, ,372.9 Investment in shares of stock Fixed assets 3, ,177.4 Advances for land acquisition Other non-current assets TOTAL ASSETS 12, ,787.5 Current liabilities 4, ,142.4 Trade payables 3, ,836.9 Short-term bank loans Current maturities of long-term bank loans Other current liabilities Non-current liabilities 2, ,435.4 Long-term bank loans and others Bond payable 1, ,488.1 Other non-current liabilities Equity 4, ,209.7 Equity attributable to equity holders of parent entity 4, ,037.0 Minority interest TOTAL LIABILITIES AND EQUITY 12, ,787.5 Financial Position (Rp billion) Jun-13 Dec-12 Cash and Cash Equivalents 1, ,884.9 Shareholder Equity 4, ,037.0 Ratios 1H13 FY 12 Return on Equity (%) Return on Assets (%) Net Profit Margin (%) Total Assets Turnover (x) Current Ratio (x) Net Gearing Ratio (x)

10 3 y 4 y Outstanding Loan Position Loan as per June 30, 2013 IDR USD RMB Net Gearing 0.5 Bn Mn Mn 0.4 Short Term Bank Loans Long Term Loans * Bond Payables 1,490 Total 2, M11 6M11 9M M12 6M12 9M M13 6M Debt Split by Currency % 3 B, M R Debt Split by Maturity 1 y < % 9 1 r, a e * AKR has exposure to debt in USD for Jakarta Tank Terminal which is guaranted by Vopak (JV Partner). % 1 3 D, S U 5 y > % 6 3 r, a e % 5 r, a e Net gearing is well managed at 0.4x equity with majority having > 3 years maturity. % 7 6 R, D I Despite majority debt in IDR. Functional currency is in USD which translation impact from debt in Balance Sheet should be zero to positive. % 0 4 r, a e 10

11 III. Business Segments Review 11

12 Basic Chemicals Sales Revenue (Rp Billion) Volume (in 000 s MT) 2,990 2,648 1,133 1,237 1,275 1,641 1,934 1, H H13 Sales volume grew over 6% driven by demand from Indonesian industries during 1H Principals Chemicals commission-based sales volume contributed 65% to total sales volume and trading 35%. The increase on sales volume came mostly from commission-based products during 1H Key principals for Chlor-Alkali products have increased production capacity during April May 2013 which should positively impact volume sales. Basic chemical demand expected to rise in coming periods in line with Indonesian economic growth. 12

13 Unsubsidized Petroleum Distribution Sales Revenue (Rp Billion) Volume (in 000 s KL) 14,915 17,296 2,040 2,149 1,356 7,474 8,317 1,025 1,025 5, H H13 Maintained the sales volumes in unsubsidized fuel despite the slowdown in the coal industry. The slowdown in the mid and small coal mines was compensated by increasing sales to higher calorie mines in Central Kalimantan. AKR invested in logistics facilities including self propelled oil barges, storage facilities to service these customers. Sales volume of unsubsidised fuel during 1H 2013 was impacted due to disruption of supplies in a major customer site during the second quarter; However, supplies to this customer have resumed from July Gross margin of petroleum improved during the 1H 2013 to 4.5%. 13

14 S u, g n, n i n i m S u n i n i m Petroleum Distribution Fuel Volume & ASP Fuel Capacity Coverage 4,000 3,500 3,000 2,500 2,000 1,500 1, , , ,906 1,025 5,513 1,356 7,313 2,040 8,047 8,111 2,149 1,025 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1, ,000 5,000 4,000 3,000 2,000 1, H13 Total Tank Space ML (12 Annual Turns) Fuel Sales Volume (ML) Fuel Split by Region Fuel Split by Industry s e ti d i o m m o c / l i t a R e % 8 % 5, d y s b i i r u t c f u a n ma % 5 1, a pu P a % 0 1 l oa c % 5 4 g, t, n l p a r we o p n, t a n ma l i K a % 2 1 % 9 4 li, B a & va J a % 1 2, ra t e % ma 5 l a S u % 5 i s, we l ra ne i m % 5 2 g, 14

15 Subsidized Petroleum Next Growth Driver AKR s Allocated 880,850 KL of Subsidized Fuel for the year 2013 BPH Migas entrusted AKR the entire reserve in June 2013 increasing the allocation of subsidised fuel to 880,850 Kilo liters for the year Earlier in December 2012, AKR allocation of petroleum to 267,892 Kilo liters from 103,263 Kilo liters granted in 2011/2012. Plan to increase the petrol stations to 141 locations from 31 petrol stations last year to cater to increased allocation. Additional 110 new locations will be built in Java, Sumatera and Kalimantan, including petrol stations for motorists and fishermen. Expecting the delivery of additional allocation received in June 2013 to start picking up from Q on the commissioning of stations and expect full utilization of quota in Allocated Volume Quota (000 s KL) No of Petrol Stations Dec Dec Jun-12 Akhir

16 Integrating Infrastructure with Technology to Distribute Subsidised fuels - The only private sector player in PSO distribution Indonesian petroleum downstream deregulation body (BPH Migas) awarded the tender to AKR after evaluating the extensive infrastructure across Java, Sumatera, Bali, Kalimantan, Sulawesi and the IT platform to support the sales and reporting of subsidised fuel. The only private sector player allotted the distribution of subsidised fuel. Innovative Point of Sales System Over 250 trucks delivering fuel and chemicals Products sold at subsidised prices Self Propelled Oil Barges and Tankers to move cargo across archipalego Network of Tank Terminals to support Imports and distribution across 19 locations 16

17 Progress of Construction of Outlets No of PSO Outlets Status as on 31/8/2013 Region Total SPBKB SPBN Already Under Allocation Commissioned Construction Sumatera Jawa Bali Kalimantan Sulawesi Total * SPBKB for Motorists, SPBN for Fishermen

18 Photos of New Stations Singkawang - Kalimantan Barat Banjarbaru - Kalimantan Selatan Cempaka - Kalimantan Barat Lempasing - Lampung Tegineneng II Lampung Babatan Lampung 18 18

19 Photos of New Stations Yos Sudarso Medan, Sumatera Utara Tapin Kalimantan Selatan Tegineneng I Lampung Sungai Loban Kalimantan Selatan Sanggau Kalimantan Barat Canang Medan, Sumatera Utara 19 19

20 Tankers and Self Propelled Oil Barges Tanker AKRA 10 SPOB AKRA 20 Tanker AKRA 30 Tug Boat AKRA 40 Oil Barge AKRA 50 SPOB AKRA 60 Over 20 vessels (owned and chartered) and over 250 trucks deliver fuel interisland and up water ways to industrial and retail customers. 20

21 Subsidised Petroleum Market Continues To Grow Despite Goverment Efforts To Reduce Subsidies Although Indonesia has a plenty of oil production fields and is among the top 25 oilproducing nations in the world, it is a net importer of petroleum. Gasoline is so heavily subsidized that at the end of 2012, the country had the lowest fuel prices of any net oil-consuming nation in the world, according to the World Bank. Indonesian Government has been making efforts to reduce fuel subsidy that could go to crucial public social programs including health care, as well as much-needed infrastructure investment. Under penetration in retail petroleum network also offers opportunity for growth in distribution of Petroleum to retail segment. Indonesian downstream Petroleum volumes Million KL 2012 Volumes 60% subsidised Million KL Year E Fuel Subsidy Fuel Non Subsidy Total Demand

22 Aim to Secure Larger Volumes in Subsidised Sector Leveraging Infrastructure Closely Working with Franchisees AKR aims to increase its volumes sales in the Subsidised petroleum sector by winning higher allocations from BPH Migas and by leveraging its logistics infrastructure. Work closely with Franchisees ( DODO, CODO, COCO Model ) to expand the network. Low capital outlay; most cost funded by Franchisees. Efficient IT and systems enables AKR to collect the subsidies from the Government while maintaining its sales growth combined with stable margins. SPBKB : ( Motorists) Dealer Location Criteria Owns land located in major roads with high traffic count. Land area must be at least 2,000 square meters in size with frontage minimum of 40 meters. SPBN ( Fisheries) Located in the center of fishermen, in fishing ports, in fish landing centers or fishing villages. The location can be reached by tanker with 8,000 liter capacity. Proposed location must have approval from DKP and recommendation from local Department of Fisheries and Marine Resources. The cost of land preparation utilities connection and government permits borne by Dealer. AKR invests in the civil works (building, canopy, driveways and building plans), mechanical works (dispensers, storage tanks, product lines, oil / water separator and other station equipment), Information Technology and safety as required by the Government provided by AKR. Inventory belongs to and controlled by AKR Dealer receives fixed fee for distribution while AKR manages the collection of subsidies from the Government Implementation & Costs 22

23 Third Party Logistics Guigang Ports Reported Better 1H13 Performance Investment in Pearl River Ports in China Located in Pearl River - Guigang, South China for handling containers, bulk, coal, steel and grains; acquired from Chinese Government in 2006 Subsidiary companies: Guangxi (GuiGang) AKR Container Port Co. Ltd. (94.64%) AKR (GuiGang) Port Co. Ltd. (100%) AKR (GuiGang) Transshipment Port Co. Ltd. (78%) All the river ports are well connected by railway and other infrastructure. 1H13 performance: - Volume of general and bulk cargo up 39% in 1H13 compared to 1H12 - Volume of container grew up to 20% - Sales Revenues is increased by 48% compare to last year period - Net profit margin increased by 17% from the same period last year Container Port Coal and Bulk Transhipment Port 23

24 Third Party Logistics UEPN Indonesia Container Volumes up 35% AKR s subsidiary PT Usaha Era Pratama Nusantara (UEPN) works closely with Pelindo III at Tanjung Perak Port, Surabaya; Investment in harbour mobile crane: 8 units and RTG 2 units, Stevedoring & Port handling services 1H13 performance: - Volume of containers served during 1H13 increased up to 65% compared to the same period of last year from 183,187 TEUs to 302,823 TEUs. - Operating profit grew 32% from previous year, from IDR 13.7 billion to IDR 22.3 billion. - Net income increased up to 13% from IDR 8.3 billion to IDR 11.0 billion. New JV with Pelindo for expansions in Surabaya Port PT Terminal Nilam Utara has been set up with AKR subsidiary holding 60% to further expand terminal operations in Surabaya Port for bulk liquids and Gas. 24

25 IV. Java Integrated Industrial and Ports Estate 25

26 Project Profile and Update 26 26

27 JIIPE Vision To become the most reliable and trusted partner in providing efficient and competitive logistic & energy to our clients JIIPE will provide an Integrated Port and well connected Industrial Estate in the most populous and industrious area of EAST JAVA with Access to Energy, Rail and Road and Single widow coordination to start business in our estate The deep sea port will be an important export and import gateway for East Java and a favorable location for development of industrial complex with access to energy, ports, road, railway, and other logistic infrastructures to attract significant domestic and international investors

28 JIIPE Business Model "The costs of logistics across Indonesia account for some 24% of GDP (Gross Domestic Product), higher than in neighboring countries. Cutting costs and improving the quality of logistics and transport systems would vastly improve Indonesia s access to international markets and increase trade, ---- World Bank. The higher costs were due to inefficiencies and bottlenecks in most of the country s roads and ports, both of which accounted for 92% of the country s logistical traffic. Business case for JIIPE : Logistics and Energy Solution in one location : Development of large integrated Industrial parks provided with good transportation access, including road and rail located close to transport facilities, especially where more than one transport modes coincide, including highways, railroads, airports, and ports. Aim is to reduce Per-business expense by providing infrastructure such as roadways, railroad sidings, ports, high-power electric supplies high-end communications, large-volume water supplies, and high-volume gas supplies. 28

29 The Developers PT. AKR CORPORINDO Tbk, One of the biggest & reputed Publicly listed Energy and Logistics company in Indonesia PT. BERLIAN JASA TERMINAL INDONESIA, a subsidiary of PT. PELABUHAN INDONESIA III, a state owned enterprise handling all the public ports in Central & East Java, Bali, South & Central Kalimantan and Nusa Tenggara. MASTERPLANNING CONSULTANT NIPPON KOEI CO., LTD and PT. INDOKOEI INTERNATIONAL 29

30 Location 30 30

31 JIIPE is located at the heart of East Java industrial area, with fast growing economic and conducive investment condition. Location LAMONGAN GRESIK Madura Island SURABAYA 31 31

32 JIIPE Map of Project Location 32

33 JIIPE Aerial Photo of Madura Strait 33

34 Accessibility Direct access to sea, major toll road network, arterial road and railway system as well as air transport access. FROM EST. DISTANCES GRESIK CITY VIA ARTERIAL ROAD 10.5 MANYAR TOLL GATE 3.5 SURABAYA CITY VIA TOLLROAD 24 TJ.PERAK PORT 26.7 JUANDA AIRPORT 55 DUDUK RAILWAY STATION

35 L O T Access Plan TOLL TO TUBAN TOLLROAD ACCESS M K 5 3. = E P JI O T R A Y N A M M O R F RAILWAY ACCESS 10 KM FROM DUDUK STATION MANYAR TOLLGATE DUDUK RAILWAY STATION KEBOMAS TOLLGATE 35 35

36 Master Plan 36

37 Industrial Estate - Master Plan and Development 37 37

38 Industrial Estate - Master Plan and Development JV Company Berkah Kawasan Manyar Sejahtera (BKMS) Stake Acquired 60% Partner Pelindo III Location Gresik, East Java Total Area 1761 Hectares Rationale 1. Commercially and Financially attractive area with fast growing economic and conducive investment condition. 2. Direct access to deep water port, toll road, arterial road and railway system as well as air transport access. Development Progress 3. Contributes to the development of distribution efficiency by reducing logistic costs to be more competitive. 1. Land already acquired 1,000 Ha 2. 1 stage of 798 ha will be developed and ready by October Refilling the land on progress from June Railway and Toll Road connection is on going progress of land acquisition and negotiation with authority. 5. First piling for Tanggok bridge development started October 3, Significant interest from industrial players like CPO industry, Feed Mill, manufacturing and etc Financing Combination from Bond issuance and Internal cash Expected Debt vs Equity 30;70 38

39 Revenue Streams & Business Model Stage 1 Stage 2 Stage 3 - Land Acquisition - Development of industrial estate - Deep water port & infrastructure - Phased development of industrial estate - Launch of industrial estate and sales to domestic international investors - Development of port facilities Real Estate Revenue - Sales of land phase II & III - Recurring revenue from industrial estate - Development of key infrastructure such as power plants, water treatment, roads and piping. Recurring Income - Gas & energy distribution - Port logistics & port infrastructure - Other business opportunity - Railway depot Expansion & New Business Opportunity 1. Significant value to investors 2. Quality earnings and impressive returns 3. Shall take AKR business to the next level 39

40 Reclamation in Progress 40 40

41 1 st Piling for Bridge Commenced

42 Sea Port - Master Plan and Development JV Company Berlian Manyar Sejahtera (BMS) Stake Acquired 40% Partners Pelindo III Location Total Area Rationale Gresik, East Java 371 Hectares (Reclamation) 1. Deep Water Port of draft 16 Meters capable of handling large size vessels. 2. Sheltered Port with natural break water Madura island. Development Progress 1. Multi purpose port of 70 Ha will be built and expected to be ready by the end of Oct Bridge of 500 meters length will be built as the access road to connect port area and industrial estate. Having 2 x 2 lanes (80 meters width) 3. Jetty will be built for 250 meters first and the construction will start in October Sea reclamation will start on October Dredging of the channel from 12 meters up to 16 meters Financing Combination of Equity Portion and Commercial Loan Expected Debt vs Equity 30;70 42

43 Illustration of JIIPE port Reclamation Phase 1 43

44 Timeline for Development o COMPLETION OF MASTER PLAN COMMENCEMENT OF LAND FILLING o COMMENCEMENT OF LAND FILLING COMPLETION OF STAGE 1 OF INDUSTRIAL ESTATE o GROUND BREAKING AND LAUNCHING 7 MAY 2013 SEPTEMBER 2014 o COMPLETION OF STAGE 1 OF INDUSTRIAL ESTATE COMPLETION OF STAGE 1 A OF PORT FACILITY (MULTI PURPOSE TERMINAL) o COMPLETION OF STAGE 1 OF PORT FACILITY (MULTI PURPOSE TERMINAL) SEPTEMBER

45 Funding for Stage 1 Arranged by Equity, Bond and Borrowing (US$ Million) Fund Requirement Land Land Equipment / Total Acquisition Reclamation Development Port Industrial Estate Total (US$ Million) Financing Port Industrial Estate Total Equity Injection Bond Issuance Bank Loan/Borrowing Total Do not anticipate any right issue Revenue Stage1 (US$ Million) Income Saleable land (560 ha/ 70%)

46 Consistent Payout Dividend Consistent dividend payout ratio above 30% in the last 5 years. Year Cash Dividend per Net Profits Total Dividend Payout Share (Rp) (Rp Bn) (Rp Bn) Ratio % % % interim ** ,293.4 * , % 38.7% * Includes extraordinary profit from divestment of subsidiary 59.9% ** Interim dividend paid on October 4, % 34.4% 39.3% 38.7%

47 Stock Price Performance 7,000 Share Performance 6 Months 1 Year 5 Years AKR Corporindo Tbk PT % +3.66% % JSX COMPOSITE INDEX % +2.76% % 160,000,000 6, ,000,000 5,000 4, ,000, ,000,000 80,000,000 3,000 2,000 60,000,000 40,000,000 1,000 20,000,000 - Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 - Source: (Sept 30, 2013) Bloomberg Code : AKRA IJ Market Cap : US$ 1.34 billion Issued Shares : 3,880,727,500 Major Shareholders (%) PT Arthakencana Rayatama : 58.77% Public : 41.23% AKRA Constituent stock of LQ 45 Index ( Most liquid stocks in Indonesian Stock Exchange ) AKRA also part of IDX Bisnis 27 and Sri Kehati Green Stock index Included in MSCI Indonesia Small cap Index Eligible for 5% corporate tax deduction as more than 40% free float held by Public shareholders 47 47

48 Group Structure PT Arthakencana Rayatama Public 58.77% 41.23% Trading and Distribution Logistic Services Manufacturing Coal Mining and Trading PT AKR Niaga Indonesia 99.99% PT Jakarta Tank Terminal 51.00% Guangxi (Guigang) AKR Container Port Co Ltd Khalista (Liuzhou) Chemical Industries PT Arjuna Utama Kimia Co Ltd 94.64% 99.96% % 94.64% PT Anugrah Karya Raya AKR (Guangxi) Coal Trading Co Ltd % PT AKR Sea Transport AKR (Guigang) Port Co Ltd 99.99% % PT AKR Transportasi Indonesia 99.99% AKR (Guigang) Transshipment Port Co Ltd 78.00% PT Andahanesa Abadi 99.99% PT Terminal Nilam Utara 60.00% PT Usaha Era Pratama Nusantara 99.99% PT Berkah Kawasan Manyar Sejahtera 60.00% PT Berlian Manyar Sejahtera 40.00% 48

49 Thank You V Suresh Director suresh.vembu@akr.co.id Heri Akhyar Head of Investor Relations heri.akhyar@akr.co.id PT AKR Corporindo Tbk Wisma AKR 8 th Floor Jl. Panjang No. 5 Kebon Jeruk Jakarta Barat Indonesia 49

50 Disclaimer These materials have been prepared by PT AKR Corporindo Tbk (the Company ) and have not been independently verified. No representation or warranty, expressed or implied, is made and no reliance should be placed on the accuracy, fairness or completeness of the information presented or contained in these materials. The Company or any of its affiliates, advisers or representatives accept no liability whatsoever for any loss howsover arising from any information presentated or contained in these materials. The information presented or contained in these materials is subject to change without notice and its accuracy is not guaranteed. These materials 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. 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. These materials are for information purposes only and do not constitute or form part of an offer, solicitation or invitation of any offer to buy or subscribe for any securities of the Company, in any jurisdiction, nor should it or any part of it form the basis of, or be relied upon in any connection with, any contract, commitment or investment decision whatsoever. Any decision to purchase or subscribe for any securities of the Company should be made after seeking appropriate professional advice. 50