Pt Chandra Asri Pacific Tbk · IDX:TPIA
Pt Chandra Asri Pacific Tbk — PT Chandra Asri Petrochemical — Non-Deal Roadshow (December 2017)
39 slides from Pt Chandra Asri Pacific Tbk's roadshow presentation, Dec 15, 2017
Slide 1: PT Chandra Asri Petrochemical Tbk NDR Presentation - Bangkok
PT CHANDRA ASRI PETROCHEMICAL TBK [TPIA.JK] NDR Presentation - Bangkok December 15th, 2017 (hosted by Credit Suisse)
Slide 2: Table of Contents
Table of Contents 1. Introduction to Chandra Asri Petrochemical 2. Key Investment Highlights 3. Attractive Growth Profile 4. Financial Highlights 1
Slide 3: Introduction to Chandra Asri Petrochemical
1. Introduction to Chandra Asri Petrochemical 2
Slide 4: Indonesia's Leading and Preferred Petrochemical Company
Chandra Asri – Indonesia’s Leading and Preferred Petrochemical Company Largest Integrated Petrochemical Producer in Indonesia Largest integrated petrochemical producer in Indonesia and operates the country’s only naphtha cracker, styrene monomer and butadiene plants Market leadership in highly attra
Slide 5: 25 Year Track Record of Successful Growth
25 Year Track Record of Successful Growth CAP 510m 2011 2015 Merger of CA and TPI 155m effective from 1 Jan 2011 Completed cracker expansion project and (US$) Adjusted 135m 2.1bn Completed de- bottlenecking to raise TAM 2017 polypropylene capacity to EBITDA 1.9bn 1.9bn 480 KT/A SCG Chemicals acquire
Slide 6: Vision to be Indonesia's Leading and Preferred Petrochemical Company
Vision to be Indonesia’s Leading and Preferred Petrochemical Company 1 Increase capacity and build on leading market position Expand product offerings and further optimize integration along the 2 petrochemical value chain 3 Develop feedstock advantage to improve cost competitiveness 4 Develop and nu
Slide 7: Integrated Production of Diverse Products
Integrated Production of Diverse Products Use of Goods (examples) Capacity (KT/A) Capacity (KT/A) Polyethylene (336) Naphtha Ethylene (860) Styrene Naphtha Monomer (340) consumption of 2,450 KT/A at full Merchant capacity market (430) Propylene (470) Polypropylene (480) Pyrolysis Gasoline (400) Mixe
Slide 8: CAP is Indonesia's Largest Petrochemical Producer
CAP is Indonesia’s Largest Petrochemical Producer Capacities of Petrochemical Producers in Indonesia (March 2017) Capacity ('000 tons per year) Polytama Others Total Ethylene 860 860 Propylene 470 608 1,078 LLDPE 200 200 400 HDPE 136 250 386 Polypropylene 480 45 240 765 Ethylene Dichloride 644 370 1
Slide 9: Key Investment Highlights
2. Key Investment Highlights 8
Slide 10: Key Investment Highlights
2. Key Investment Highlights 1 Attractive industry outlook Well-positioned to benefit from attractive Indonesian growth 2 fundamentals Indonesia’s leading petrochemical producer with a diverse 3 product portfolio 4 High degree of operational integration Diversified customer base and strategically lo
Slide 11: Attractive Industry Fundamentals Providing Tailwinds for Petrochemicals Demand Growth in SEA
1 Attractive Industry Fundamentals Providing Tailwinds for Petrochemicals Demand Growth in SEA Polyolefins Demand in SEA Expected to Outpace Global Market Growth… Polyolefin Spreads Expected to Remain Resilient (US$/t) Polyethylene consumption growth (2017 – 2023E CAGR) 850 4.4% 800 3.4% 3.9% 750 70
Slide 12: Well-Positioned to Benefit from Attractive Indonesian Macroeconomic Growth
2 Well-Positioned to Benefit from Attractive Indonesian Macroeconomic Growth and Consumption Trends GDP Growth CAGR (2017 – 2020F)(1) Polyolefins Consumption per Capita(2)(3)(4) 10% 7.7% Bubble size indicates 6.8% demand in 2016, million tons Projected CAGR 2017-2023F 6.3% 6.2% 8% 5.4% India 9 4.8%
Slide 13: Strong Demand Growth for Petrochemical Products in Indonesia
2 Strong Demand Growth for Petrochemical Products in Indonesia Total Demand Growth (1) End Markets (2017F – 2023F CAGR) Plastic films Polyethylene Containers 4.4% PE Bottles 3.4% Plastic bags Packaging Films and sheets 4.7% Polypropylene Fibers and filaments PP 3.6% Toys Automotive parts Drinks cups
Slide 14: Increasing Gap Between Supply and Demand in Indonesia
2 Petrochemical Market in Indonesia will Continue to See an Increasing Gap Between Supply and Demand Ethylene Propylene Polyethylene (KT/A) 2,357(1) (KT/A) (KT/A) 1,900(1) 1,078 1,078 1,078 1,824 1,625 1,638 1,658 899 1,317 1,384 811 876 1,231 1,231 860 890 900 833 (457)(1) 267 202 179 (484) (394) (
Slide 15: CAP is the Indonesian Market Leader
3 CAP is the Indonesian Market Leader 1 Largest Petrochemical Company in Indonesia(1) Olefin Top 10 South East Asia Producers(3) ('000 tons per year) Olefin Polyethylene 5,000 4,000 3,000 7 Pertamina CAP LCT(2) CAP 2,000 24% 24% 1,000 52% 31% 0 PTTGC Sumitomo Pertamina Shell/QPI ExxonMobil Chandra A
Slide 16: Highly Integrated Production Process with Operational Flexibility
4 Highly Integrated Production Process with Operational Flexibility Cogen Naphtha cracker, polyethylene and butadiene plants Naphtha Cracker Fuel Gas 51.56MW GTG source approximately half of the power from PLN and & 31.25MW STG the remaining half from the GTG, with the STG being used HDPE & LLDPE as
Slide 17: Strategically Located to Supply Key Customers
5 Strategically Located to Supply Key Customers CAP’s Integrated Petrochemical Complexes Rhone Poulenc SBL Sulfindo Adi. Sulfindo Adiusaha EDC, VCM NAOH, CL2 Santa Fe Sulfindo Adi. PVC Showa Esterindo Redeco Styrene Monomer Polychem Plant Puloampel- Cont Carbon CB Trans Bakrie Capacity 340 KT/A Sera
Slide 18: Diversified Client Base of Industry Leaders
5 Diversified Client Base of Industry Leaders Sales & Marketing Strategy Top 10 Customers (2016) % of Customer Long term relationships with key customers Customer Products Revenue Since Location Connected to production facilities via CAP’s pipeline (ethylene and Polyethylene, Customer 1 7.4% 1995 In
Slide 19: Stable and Flexible Feedstock Supply
6 Stable and Flexible Feedstock Supply Feedstock Procurement Overview Main Raw Materials (2016) Long-standing stable supplier relationships Naphtha/ 100% No material feedstock supply disruption historically Condensate Flexibility in feedstock purchasing (spot vs. contract) Benzene 100% − Avoids sing
Slide 20: Strong Commitment from Shareholders
7 Strong Commitment from Shareholders Shareholder Structure (as of 30 Sep 2017) Prajogo Marigold Public Pangestu(1) Resources(2) 41.51% 14.11% 4.75% 30.57% 9.06% Barito Pacific Key benefits of partnership Indonesia based conglomerate with business interests in property, Barito Pacific is committed t
Slide 21: Strong Management Team with Substantial Industry Experience
8 Strong Management Team with Substantial Industry Experience Board of Commissioners DJOKO SUYANTO TAN EK KIA HO HON CHEONG AGUS SALIM LOEKI SUNDJAJA CHAOVALIT CHOLANAT President Commissioner VP Commissioner Commissioner, PANGESTU PUTERA EKABUT(1) YANARANOP(1) Independent Independent Independent Com
Slide 22: Strong Track Record of Delivering Operational Excellence and Performance
8 Strong Track Record of Delivering Operational Excellence and Performance Naphtha Cracker Utilization(1) 99% TAM/ Expansion tie-ins: Q4/2015 94% 99% 103% 100% 99% 90% 97% 98% 97% Ramp-up of new capacity: Q1/2016 97% 92% 82% 74% 76% 66% 65% 57% 11% 2014 2015 2016 YTD 1Q2014 2Q2014 3Q2014 4Q2014 1Q20
Slide 23: Strong Success of Both Vertical and Horizontal Expansion
8 Strong Success of Both Vertical and Horizontal Expansion (KT/A) Successfully acquired and integrated SMI and TPI Cracker Merger with expansion & TPI & BD Plant Cracker Acquisiton Increase PE operation expansion of SMI Capacity Expanded naphtha cracker in 2015 to achieve economies of scale and take
Slide 24: Attractive Growth Profile
3. Attractive Growth Profile 23
Slide 25: Strategic Growth via Expansion and Debottlenecking (Excluding Second Petrochemical Complex)
Strategic Growth via Expansion and Debottlenecking (Excluding Second Petrochemical Complex) SSBR PE expansion C2, C3, MTBE operation, BD & PP Debotlenecking and Butene-1 expansion 2016 – 2020 CAGR: 6.2% C2: ∆40KT C3: ∆20KT PE: ∆400KT SSBR: ∆120KT MTBE: ∆130KT PP: ∆110KT BD: ∆37KT B1: ∆43KT After dou
Slide 26: Strategic Growth via Expansion and Debottlenecking
Strategic Growth via Expansion and Debottlenecking Increase Production Capacity Butadiene Plant Expansion New Polyethylene Plant Furnace Revamp Increase BD capacity by 100 KT/A to 137 KT/A New facility of total 400 KT/A to produce LLDPE, Increase cracker capacity by modifying heat Rationale: HDPE an
Slide 27: Financial Highlights
Chandra Asrt Petrochemical (@ é., Financial Highlights 26
Slide 28: Resilient Revenue Driven by Diverse Product Portfolio and Increased Volumes
Resilient Revenue Driven by Diverse Product Portfolio and Increased Volumes Revenue by Product Segments Sales Volume (US$m) (KT) 2,460 5 1,908 219 85 1,724 419 1,930 277 1,572 204 7 1,798 139 82 6 196 270 289 257 427 1,378 1,173 4 323 46 78 340 471 230 1,303 256 885 316 706 34 243 449 236 7 314 197
Slide 29: Strong Gross Margins Reflecting Improved Supply/Demand Balance
Strong Gross Margins Reflecting Improved Supply/Demand Balance & Higher Utilization Rates Olefins Polyolefins 32.0% 29.6% 27.2% 27.7% 15.8% 2.0% 7.0% (0.9%) 2014 2015 2016 YTD 3Q17 2014 2015 2016 YTD 3Q17 Styrene Monomer and by-products Butadiene and by-products 8.7% 8.4% 16.1% 11.1% 5.0% 2.9% 1.7%
Slide 30: Strong Financials Further Enhanced by Economies of Scale
Strong Financials Further Enhanced by Economies of Scale Gross Profit Adjusted EBITDA (unaudited) 494 Adjusted EBITDA 6% 11% 26% 24% +239% 426 margin yoy 510 +229% yoy 431 146 118 155 135 2014 2015 2016 YTD 3Q17 2014 2015 2016 YTD 3Q17 Net Profit Cashflow from Operations, Capex Net Profit 1% 2% 16%
Slide 31: Strong Balance Sheet Supported by Financial Profile Strengthening
Strong Balance Sheet Supported by Financial Profile Strengthening Cash Balance Debt and Net Debt (US$m) (US$m) 548 634 491 451 425 356 283 299 208 *Net cash 126 position 97 after Rights Offering 2014 2015 2016 YTD 3Q17 2014 2015 2016 YTD 3Q17 Adjusted EBITDA / Finance Costs (1) Leverage Ratios (2) (
Slide 32: Capital Expenditure Plan to Pursue Value-Accretive Growth
Capital Expenditure Plan to Pursue Value-Accretive Growth Capex Plans Breakdown by Year 2017 – 2019 (US$m) Sources of Funding Internal generated cash flows 534 Proceeds from Rights Issue 398 303 Debt drawdown 154 253 81 39 30 45 42 9 24 10 11 62 16 12 8 98 137 63 19 23 - 2017F 2018F 2019F BD expansi
Slide 33: Appendix
Chandra Asrt Petrochemical (@ Appendix 32
Slide 34: Petrochemicals Industry Outlook
Petrochemicals Industry Outlook 33
Slide 35: Ethylene World Supply Growth and Capacity
Ethylene World Supply Growth and Capacity Ethylene World Supply Growth (million tons) (Operating rates) 250 Actual Forecast 100% 200 90% 150 100 80% 50 0 70% 2009 2011 2013 2015 2017 2019 2021 2023 Ethylene Consumption Total Capacity (with Unsactioned Capacity) Total Capacity (with No Unsactioned Ca
Slide 36: The Petrochemical Industry is in a Long Term Cyclical Phase
The Petrochemical Industry is in a Long Term Cyclical Phase Ethylene Spreads Over Naphtha Gap over naphtha (US$/t) % Utilisation 700 100% 600 Average 2013-2016: US$567 Average 2017-2019: US$568 90% 500 Average 2020-2023: US$424 400 80% Average 2009-2012: US$306 300 200 70% 100 0 60% 2009 2010 2011 2
Slide 37: Strong Demand Growth for Petrochemicals in Indonesia
Strong Demand Growth for Petrochemicals in Indonesia Ethylene (CAGR ’17 – ’23) Propylene (CAGR ’17 – ’23) Butadiene (CAGR ’17 – ’23) 3.2% 3.1% 5.4% 17.7% 2.4% 3.4% 1.7% 5.5% 2.4% Global SEA Indonesia Global SEA Indonesia Global SEA Indonesia Polyethylene (CAGR ’17 – ’23) Polypropylene (CAGR ’17 – ’2
Slide 38: Prudent Financial Policies
Prudent Financial Policies Maintain natural economic hedge as underlying sales and majority of costs and borrowings are denominated in US$ Foreign Exchange Treasury risk management on Rupiah currency risks: − Sales are hedged via pricing to customers and forward swaps with reputable banks − Minimum
Slide 39: Contact and Important Notice
Chandra Asrt Petrochemical Address: Contact: PT Chandra Asri Petrochemical Tbk Investor Relations Wisma Barito Pacific Tower A, Lt. 7 » Email: * ®) JI. Let. Jend. S. Parman Kav. 62-63 eh +62 21530 7950 Jakarta 11410 Visit our website at Important Notice oe ” * a ee ah. B rs per Ser i” * This documen
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