TO BE A SUSTAINABLE ASEAN-CLASS COMPANY Company Update January 2017
Table of Contents 1. Company Overview 3 2. Company Update 9 3. Financial Highlights 12 4. Opera?onal Highlights 19 IMPORTANT: The following forms part of, and should be read in conjunction with, this presentation This presentation contains privileged information and has been prepared solely for the recipient. By accepting a copy (or the contents) of this presentation, you are deemed to have acknowledged and agreed to the provisions appearing hereinafter. The existence of this presentation and the contents thereof should not be disclosed, reproduced, copied or otherwise disseminated to any other person or published, in whole or in part, without prior consent of PT PP (Persero) Tbk. ( PTPP or the Company ) Unless otherwise stated, the Company is the source for all data contained in this presentation. 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Any decision to purchase or subscribe for securities should be made only on the basis of the information contained in a prospectus or offering circular issued by the Company in connection with any such offering. This presentation has no regard to the specific investment objectives, financial situation or particular needs of any recipient. This presentation contains forward-looking statements that involve risks and uncertainties. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements as a result of a number of risks, uncertainties and assumptions. Although the Company believes that such forward-looking statements are based on reasonable assumptions, it can give no assurance that such expectations will be met. Representative examples of these factors include (without limitation) general industry and economic conditions, interest rate trends, cost of capital and capital availability, and competition from other companies. 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Sec/on 1 Company Overview 3
Brief Overview About PTPP PT PP (Persero) Tbk ( PTPP or the Company ) is one of Indonesia s leading construc?on SOEs with proven track records of over 60 years with focus on property (high rise buildings and property projects) and infrastructure (EPC and port projects) segments. Involved in various high quality and innovahve projects, PTPP is well- posi?oned to benefit from strong demand growth in Indonesia construc?on and infrastructure sectors. With integrated business from upstream to downstream, divided into 7 pillars consisted of infrastructure, energy, property, construc?on, EPC, precast and equipment, PTPP has also extensive na?onwide network and opera?onal area from Aceh to Papua and Timor Leste. Innova?ve projects led PTPP to mul?ple awards, including the Green technology for various building and property construc?on projects, and the Company ranked as the first Green Contractor in Indonesia in 2008. PTPP has demonstrated its efficient operahon which led to its superior profit margin with strong and healthy balance sheet (rela?vely low gearing ra?os) to compete in securing new contracts; hence, crea?ng significant value for all of the Company's shareholders. VISION To be a leading and sustainable construc?on and investment company in South East Asia MISSION Providing Construc?on and EPC services as well as Good Corporate Governance- based Investment, QSHE Management, Risk Management, and Green Concept that priori?ze on customer sa?sfac?on and sustainability Developing Business Synergy Strategy to create high compe??veness and op?mal value add for the Stakeholders Crea?ng Excellent Human Resources with Recruitment, Development and Assessment based on Corporate Culture Op?mizing Knowledge Management to achieve Sustainable Excellent Performance Developing Corporate Strategy through Financial strengthening to increase Equity Corporate Value Hotel Indonesia, 1962 Kalibaru Port, 2015 4
Company Milestones Diversifica?on to Construc?on Equipment 2016 Market cap: IDR 23.6 trillion (2016 Year- End) Transformed to become PT Pembangunan Perumahan (Persero) 1953 EMBO Government of Republic Indonesia 51% KKSPP 49% 1971 Established as NV PP 1991 2004 Diversifica?on to Property and Realty Diversifica?on to EPC and Investment Market cap: IDR 2.7 trillion (IPO) 2010 2011 2012 2014 Diversifica?on to Precast 2015 IPO: February 9 Listed on the Indonesia Stock Exchange Offering about 1.0 billion shares @IDR560 Completed Right Issue 4.4 trillion Rupiah @IDR3,250 Diversifica?on to Energy and Infrastructure IPO: May 19 Subsidiary PT PP Proper? Tbk was listed on the Indonesia Stock Exchange 5
Corporate and Shareholding Structure Government of Republic of Indonesia Employee CooperaHve Of PTPP Shareholders Public 51.00% 3.16% 45.84% 64.98% 99.98% 99.99% 99.00% 99.00% PT PP ProperH Tbk PT PP Peralatan Konstruksi PT PP Pracetak PT PP Energi PT PP Infrastruktur Associates (less than 50%) PT HKM 99.00% PT GSN 99.90% PT PGI 15.00% PT Griyaton 96.57% PT MDP 49.00% PT IME 35.00% PT PMT 25.00% PT AIE 30.00% PT JMKT 15.00% PT PP TAISEI 15.00% PT PPP 20.00% PT MP 4.67% PT PG 15.00% PT CW 12.50% PT SIP 20.00% PT JMPM 35.00% PT JMBS 15.00% PTJMMB 15.00% PT AIE : PT Alam In? Energi PT JMPM : PT Jasa Marga Pandaan Malan PT CW : PT Citra Waspphutowa PT MDP : PT Muba Daya Pratama PT GSN : PT Gitanusa Sarana Niaga PT MP : PT Mitracipta Polasarana PT Griyaton : PT Griyaton Indonesia PT PGI : PT Pancakarya Grahatama Indonesia PT HKM : PT Hasta Kreasi Mandiri PT PG : PT Pancakarya Grahatama PT IME : PT Inpola Meka Energi PT PMT : PT Prima Mul? Terminal PT JMBS : PT Jasa Marga Balikpapan Samarinda PT PP Taisei : PT PP- Taisei Indonesia Construc?on PT JMKT : PT Jasa Marga Kualanamu Toll PT PPP : PT Pekanbaru Permai Proper?ndo PT JMMB : PT Jasa Marga Manado Bitung PT SIP : PT Sinergi Investasi Proper? 6
Key Business Pillars UPSTREAM MIDSTREAM DOWNSTREAM INFRA ENERGY PROPERTY CONSTRUCTION EPC PRECAST EQUIPMENT TOLL ROAD PORT AIRPORT POWER PLANT GAS COMMERCIAL RESIDENTIAL HOSPITALITY HIGH RISE BUILDING ROAD & BRIDGES PORT DAM POWER PLANT OIL & GAS MINING CONSTRUCTION PRECAST FACTORY HIGH RISE PRECAST BUILDING MANAGEMENT FOUNDATION CONSTRUCTION ASPHALT MIXING PLANT READY- MIX PLANT EQUIPMENT RENTAL 7
Extensive NaHonwide Network and OperaHonal Area DVO Branch OperaHon Branch VI: Balikpapan DVO I Branch I: Branch II: Aceh, North Sumatera Lampung, Bengkulu, South Sumatera, BaBel & Banten Branch I: Medan Branch IX: West Sumatera, Jambi, Riau & Riau island Branch IX: Pekanbaru DVO II DVO III Branch III: Branch IV: Branch V: Branch VI: DKI Jakarta West Java Central Java, East Java, DIY Kalimantan DVO IV Branch VII: Branch VIII: Bali, NTB, NTT, Papua & Timor Leste Sulawesi, North Maluku, Maluku Branch VIII: Makassar Branch II: Palembang Branch III: Jakarta Branch IV: Bandung Branch V: Semarang Branch VII: Bali Timor Leste 8
Sec/on 2 Company Update 9
4Q 2016 Updates RaHng upgraded, stable outlook. Credit ra?ng agency Pefindo upgraded PTPP s rahng and its outstanding Bonds and Medium- Term Notes (MTN) by one notch from A to A+ on November 2016. According to Pefindo, the outlook for PTPP s corporate ra?ng is Stable. The ra?ng period started from November 15, 2016 up to November 1, 2017. 10 Completed IDR4.4 trillion of right offering. PTPP has just successfully completed its right offering process on December 2016 with the issuance of about 1.36 billion of new serial B shares at IDR3,250 per share (about 15.6% discount to TERP), raising fresh funds from the Government of Republic Indonesia and public investors as much as about IDR4.4 trillion. Above target new contracts. FY2016 new contracts reached nearly IDR32.6 trillion, well above the ini?al FY2016 target (IDR 31.0 trillion) and this represented about 20% increase from FY2015 new contracts (IDR 27.1 trillion). For FY2017, PTPP is targe?ng new contract to grow by more than 20% from the Company s ini?al FY2016 new contract target (IDR31.0 trillion). 10
11M Result Summary 2016 NEW CONTRACTS +38.9% 11M 2015 IDR 21.1 Trillion 11M 2016 IDR 29.3 Trillion REVENUES +24.6% NET INCOME +41.5% 11M 2015 IDR 11.9 Trillion 11M 2016 IDR 14.8 Trillion 11M 2015 IDR 600 Billion 11M 2016 IDR 848 Billion 11
Sec/on 3 Financial Highlights 12
9M 2016 Result Summary NEW CONTRACTS +39.9% 9M 2015 IDR 16.8 Trillion 9M 2016 IDR 23.5 Trillion REVENUES +23.6% NET INCOME +46.2% 9M 2015 IDR 8.8 Trillion 9M 2016 IDR 10.8 Trillion 9M 2015 IDR 450 Billion 9M 2016 IDR 658 Billion 13
9M 2016 Profit Loss Summary (in IDR billion) 9M 2016 9M 2015 Δ YoY Opera?ng Revenues 10,846 8,775 2,071 24% Cost of Goods Sold (9,331) (7,596) (1,735) 23% Gross Profit 1,515 1,178 336 29% Total Opera?ng Expenses 348 286 62 22% Opera?ng Income 1,167 892 275 31% Other Income 72 77 (5) - 7% Other Expenses (29) (37) 8-22% Impairment (39) (46) 7-16% Interest Expenses (193) (177) (16) 9% Profit from JV 56 22 35 159% Income from Associated Company (3) - (3) - Pre- tax Profit 1,032 731 301 41% Total Income (Expenses) Tax (373) (281) (93) 33% Net Profit Aoer Tax 658 450 208 46% EBITDA 1,232 942 290 31% 14
9M 2016 Balance Sheet Summary (in IDR billion) 9M 2016 9M 2015 Δ YoY Assets Cash and cash equivalents 2,306 3,025 (719) - 24% Short- term Investment 268 277 (9) - 3% Trade Receivables, net 4,742 2,927 1,815 62% Gross Receivables from Project Owner, net 5,405 4,721 683 14% Inventories 2,611 2,499 112 4% Other Current Assets 2,542 1,981 561 28% Current Assets 17,874 15,431 2,443 16% Fixed Assets, net 3,486 2,989 497 17% Other Non Current Assets 1,112 709 403 57% Non Current Assets 4,598 3,698 900 24% Total Assets 22,472 19,129 3,344 17% LiabiliHes and EquiHes Short- term Interest- bearing Debts 4,078 1,829 2,248 123% Trade Payables, net 6,831 7,485 (654) - 9% Other Current Liabili?es 1,691 1,447 244 17% Current Liabili?es 12,600 10,762 1,838 17% Long- term Interest- bearing Debts 2,760 1,889 871 46% Other Non Current Liabili?es 1,381 1,359 22 2% Non Current Liabili?es 4,141 3,248 893 28% Total Liabili?es 16,742 14,010 2,732 20% Shareholders Equity 5,731 5,119 612 12% 15
9M 2016 Selected Key RaHos (in IDR billion, unless otherwise stated) Sep 30, 2016 Dec 31, 2015 1. Profitability Gross Profit Margin 14.0% 13.4% Opera?ng Profit Margin 10.8% 10.2% EBITDA Margin 11.4% 10.7% Net Profit Margin 6.1% 5.1% 2. Leverage Short- term Interest- bearing Debt 4,078 1,829 Long- term Interest- bearing Debt 2,760 1,889 Total Interest- bearing Debt 6,838 3,718 Cash and cash equivalents + Short- term Investment 2,575 3,302 Net Debt 4,263 416 Equity, including Non- controlling Interests 5,731 5,119 EBITDA * 1,967 1,678 Gearing ra?o (x) 1.19 0.73 Net Gearing ra?o (x) 0.74 0.08 Debt to EBITDA (x) * 3.48 2.22 Net Debt to EBITDA (x) * 2.17 0.25 EBITDA to Interest Expense (x) ** 6.4 4.5 Notes: * Trailing 12 months for Sep 30, 2016 EBITDA ** 9M 2016 EBITDA and 9M 2016 Interest Expense for Sep 30, 2016 EBITDA to Interest Expense 16
Key Financial Highlights (1) CAGR 12.3% 27,073 31,016 CAGR 35.6% 19,475 19,583 20,240 CAGR 27.4% 21,094 838 1,044 14,217 8,003 11,655 12,427 309 420 532 NEW CONTRACT NET INCOME REVENUES 17
Key Financial Highlights (2) 29,569 CAGR 58.4% 10,420 CAGR 36.4% 19,185 5,151 12,415 14,612 1,655 1,985 2,390 8,550 EQUITY ASSETS 18
Sec/on 4 OperaHonal Highlights 19
2016F Order Book Outlook Total 2016F Order Book: IDR 70 trillion Order Book: IDR 56,940 bn Order Book: IDR 70,156 bn JO 1,950 JO 3,132 CONSTR 16,690 27,073 CONSTR 15,031 PROP 1,987 EPC 3,396 INV 1,930 PP PRECAST 1,366 PP EQUIPMENT 232 CARRY OVER 2014 29,867 REVENUE 14,669 CARRY OVER 2015 39,140 31,016 PROP 2,545 EPC 5,000 INV 3,000 PP PRECAST 1,531 PP EQUIPMENT 300 CARRY OVER 2015 39,140 REVENUE 21,094 CARRY OVER 2016 47,112 2015 2016 E 20
New Contract By Project s Owners RKAP 2016: IDR 31 Trillion As of End- December 2016 (un- audited): IDR 32.6 Trillion 20.8% 19.0% 44.1% 62.3% 35.1% 18.7% SOE Government Private 21
New Contract By Projects RKAP 2016: IDR 31 Trillion 7.7% As of End- December 2016 (un- audited): IDR 32.6 Trillion 6.8% 12.9% 22.3% 52.0% 6.6% 48.7% 6.8% 3.7% 14.0% 18.5% Buildings Iriga?on Road and Bridges Ports Energy Others 22
New Contract By Business Lines RKAP 2016 : IDR 31 Trillion As of End- December 2016 (un- audited): IDR 32.6 Trillion 4.9% 1.0% 6.5% 2.3% 8.2% 7.3% 9.7% 60.1% 10.5% 54.9% 16.1% 18.5% 78.7% IDR 15.3T Investment EPC Construc?on Property Precast Construc?on Equipment 23
THANK YOU Contact us at: Plaza PP Wisma Subiyanto Jl. Letjend. TB. Simatupang No 57 Pasar Rebo, Jakarta 13760 Indonesia Phone +62 21 840 3883 Fax. +62 21 840 3890 website : www.pt- pp.com