PT Indocement Tunggal Prakarsa Tbk · IDX:INTP
PT Indocement Tunggal Prakarsa Tbk — Q3 2018 Earnings Presentation
30 slides from PT Indocement Tunggal Prakarsa Tbk's earnings presentation, Nov 8, 2018
Slide 1: PT Indocement Tunggal Prakarsa Tbk Q3 2018 Results
INDOCEMENT PT Indocement Tunggal Prakarsa Tbk Q3 2018 Results
Slide 2: Agenda
Agenda INDOCEMENT Indocement : a well positioned player Market & Financial Update Vision 2020 – Strategies & Outlook Final Message Slide 2 - 8 November 2018 Q3 2018 Results – PT Indocement Tunggal Prakarsa Tbk
Slide 3: Indocement: a well positioned player
Indocement: a well positioned player INDOCEMENT Favorable • Presence in strongly growing markets West and Central Java regional • Strong RMC position in Jakarta with pull-through on CEM exposure Innovative • Innovative ways to maintain competitive cash cost, while still ways to maintaining high prod
Slide 4: Strong footprint in West Java as a key advantage
Strong footprint in West Java as a key advantage INDOCEMENT Integrated CEM plant AGG plant Country capital ANDAMAN SEA CEM terminal RMC plant BRUNEI MALAYSIA Asset base 25 mt CEM capacity 2.8 mt AGG capacity 43 RMC plants Jakarta INDIAN OCEAN West Java is one of the fastest growing part of the count
Slide 5: Strategic location of plants & terminals
Strategic location of plants & terminals INDOCEMENT 13 CEM 8 CEM 2 AGG 39 RMC 18 172 plants terminals plants plants distributors warehouses Market position Trends & potential Strategy & focus 50% market share in West Huge infra projects in West Defending market share in Java and 40% in Jakarta
Slide 6: Brand is a very important marketing tool in Indonesia
Brand is a very important marketing tool in Indonesia INDOCEMENT Our premium Perception Award brand • “Tiga Roda” brand is perceived to have best quality & service in the country. • “Top Brand” since eleven years. • In 2017, we won in the three categories: cement, white cement and mortars. BUILDING
Slide 7: Agenda
Agenda INDOCEMENT Indocement : a well positioned player Market & Financial Update Vision 2020 – Strategies & Outlook Final Message Slide 7 - 8 November 2018 Q3 2018 Results – PT Indocement Tunggal Prakarsa Tbk
Slide 8: Indonesia – Favorable macroeconomic environment
Indonesia – Favorable macroeconomic environment INDOCEMENT Strong population Key: growing middle Upward trend in growth class urbanization +32 million +107 million 62.8% 53.3% 264 296 222 +9.5% 115 2017 2030 2017 2030 2015 2030 One of the fastest By 2050 almost 75% of growing countries Middle class
Slide 9: Long-term potential of Indonesia is clearly visible
Long-term potential of Indonesia is clearly visible INDOCEMENT Cement consumption tons per capita in kg Essroc adds 1.7mt 1,648 1,000 Average 763 excluding 617 China: 458 399 462 262 248 244 163 China South Malaysia Vietnam Thailand Australia Indonesia Phillippines India Pakistan Korea Significant h
Slide 10: Over Supply market in Indonesia remains high
Over Supply market in Indonesia remains high INDOCEMENT Overcapacity of 42 Mt in 2018 and 41 Mt in 2019 Supply growth =3% Demand growth=5% Additional Capacity in 2018 – 2.6 mt: Semen Indonesia: 1.5 mt (upgrade in Padang) Anhui Conch: 1.1 mt (start up of Bolmong North Sulawesi) Slide 10 - 8 November
Slide 11: Recent years were challenging but the worst is left behind
Recent years were challenging but the worst is left behind INDOCEMENT New entrants adopted low-pricing policies to gain market share which put pressure on pricing in the recent years. Declining ASP in 2017 was halted in 2018 with flat ASP in H1 and hiked ASP in Q3 2018 Our dual-brand strategy has su
Slide 12: Regional Shift of Demand
Regional Shift of Demand: INDOCEMENT Better Growth Outlook in Central Java and Sumatera Market shares based on cement domestic sales (Q3 2017, Q3 2018) Indonesia: Data in Box: Utilization Rate and Growth Rates YoY per area for Q3 2018 62% , +4.9% Kalimantan: 47.4Mt 49.8Mt 74% , +8.9% Sulawesi: 39% ,
Slide 13: Solid footing to capitalize on demand recovery in key markets
Solid footing to capitalize on demand recovery in key markets INDOCEMENT Near bottom: <10% vol. growth rate from lowest point in ‟14 – „18 Recovery: 10% - 30% vol. growth rate from lowest point in ‟14 – „18 Strong Recovery: >30% vol. growth rate from lowest point in ‟14 – „18 Indonesia • C. Java • W
Slide 14: Indocement's Strategies under Current Tight Competition
Indocement‟s Strategies under Current Tight Competition: INDOCEMENT More bulk sales focus - as Jakarta & West Java Projects started • High bulk volume in Jakarta Bag/Bulk sales composition • Indocement benefits from proximity to Jakarta & West Java Projects 20,000 In thousand tons 18,000 16,000 3,51
Slide 15: Consolidated Statement of Comprehensive Income
Consolidated Statement of Comprehensive Income INDOCEMENT Q1 2018 Q2 2018 Q3 2018 Q3 '18 vs. 9M 2018 9M 2017 9M18 vs. • EBITDA margin in Q3 normalized Description Q2 '18 9M17 Bio IDR Bio IDR Bio IDR % Bio IDR Bio IDR % after one-off additional expenses Total Sales Volume (thousand tons) 4,432 3,915
Slide 16: Vertical Integration in Ready-Mix Concrete & Aggregates
Indocement’s Strategies under Current Tight Competition: INDOCEMENT Vertical Integration in Ready-Mix Concrete & Aggregates Strengthening Ready-Mix Concrete business particularly high-grade quality in order to meet the increase demand of infrastructure development in Indonesia. 5,000 000m3 RMC Sales
Slide 17: Balance Sheet
Balance Sheet INDOCEMENT Sept. 30, 2018 Dec. 31, 2017 Variance Description IDR Bio IDR Bio IDR Bio % Current Assets 11,170.5 12,883.1 (1,712.6) -13.3% Non-Current Assets 15,463.8 15,980.6 (516.8) -3.2% Current Liabilities 3,250.0 3,479.0 (229.0) -6.6% Non-Current Liabilities 784.7 828.1 (43.5) -5.2%
Slide 18: Agenda
Agenda INDOCEMENT Indocement : a well positioned player Market & Financial Update Vision 2020 – Strategies & Outlook Final Message Slide 18 - 8 November 2018 Q3 2018 Results – PT Indocement Tunggal Prakarsa Tbk
Slide 19: Vision 2020 – To be the prominent cement producer in Indonesia
Vision 2020 – To be the prominent cement producer in Indonesia INDOCEMENT Highest operating margin in the industry Turn around in selling price Cost leadership Highest customer satisfaction & increase market share “Sales is a Science” program to increase our sales and create customer value
Slide 20: Clear drivers of future growth
Clear drivers of future growth INDOCEMENT Strong volume momentum and outlook Unique market position of Growth Improving supply – demand Indocement drivers dynamics Pricing stabilized and improving Slide 20 - 8 November 2018 Q3 2018 Results – PT Indocement Tunggal Prakarsa Tbk
Slide 21: Potential market consolidation as an additional upside
Potential market consolidation as an additional upside INDOCEMENT Newcomers operate Consolidation at cash losses seems to be imminent Unfavorable cost structure due lower Newcomers actively look for capacity and inferior equipment buyers for their assets Interest to be paid on debt-financed Consolid
Slide 22: Katibung, South Lampung terminal construction
INDOCEMENT 85 % ( Civil & Mechanical) Located in Katibung, South Lampung Coverage area : Lampung 3 steel silos cement @ 4,000 ton (total cap. 12,000 ton) 1 Packers 180 ton/hour 1 Line of bulk loading system 1 Truck scale cap. 100 ton 1 Warehouse 1,000 M2 Area 4.2 Ha Silos constructio
Slide 23: Bulk loading system construction in progress
INDOCEMENT Bulk loading system construction in progress Jetty is finished and operational Office construction in finishing phase Empty bag storage is finished Slide 23 - 8 November 2018 Q3 2018 Results – PT Indocement Tunggal Prakarsa Tbk
Slide 24: Karawang terminal Building Permit process
INDOCEMENT Located in Puspanegara village, Karawang – West Building Permit process 97% (Civil & Mechanical) Java Coverage area : Karawang & vicinity 2 steel silos cement @ 500 ton (total cap. 1,000 ton) 1 Line of bulk loading system 1 Truck scale cap. 80 ton Area 500 M2 Commissioning:
Slide 25: Office & worker facilities are operational
INDOCEMENT Office & worker facilities are operational Additional office is ready to Bulk loading system is use operational Slide 25 - 8 November 2018 Q3 2018 Results – PT Indocement Tunggal Prakarsa Tbk
Slide 26: Cost Efficiency Measure
Cost Efficiency Measure INDOCEMENT Increasing Usage of Alternative Fuel Sources 2015 2016 2017 2018 2030 • Signed agreement with Governor of Coal 96.3% 95.5% 95.8% 94.2% 70.0% West Java on Sept. 4, 2018 to purchase Natural Gas 0.5% 0.2% 0.4% 0.5% 500 ton of Refuse Derived Fuel, Fuel Oil 0.9% 0.9% 0.
Slide 27: Outlook of Indonesian Cement Market
Outlook of Indonesian Cement Market INDOCEMENT National cement consumption growth started to turn positive and grew by 7.6% in 2017 (versus negative growth of -0.6% in 2016) and expected to grow by 5% in 2018 Consumption in 2018 is still driven by infrastructure projects and completion of commercial
Slide 28: Agenda
Agenda INDOCEMENT Indocement : a well positioned player Market & Financial Update Vision 2020 – Strategies & Outlook Final Message Slide 28 - 8 November 2018 Q3 2018 Results – PT Indocement Tunggal Prakarsa Tbk
Slide 29: Indocement: a well positioned player
Indocement: a well positioned player INDOCEMENT Favorable • Presence in strongly growing markets West and Central Java regional • Strong RMC position in Jakarta with pull-through on CEM exposure Innovative • Innovative ways to maintain competitive cash cost, while still ways to maintaining high prod
Slide 30: Important Notice
Important Notice INDOCEMENT Disclaimer This presentation contains general information which provided without any representations or warranties, express or implied and does not constitute or form part of, and is not made in connection with, any offer for sale or subscription of or solicitation, recom
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