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PT Ancora Indonesia Resources Tbk Public Expose December 2023 Stronger foundation for future growth to serve our stakeholders across all our businesses
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Disclaimer
These materials have been prepared by PT Ancora Indonesia Resources Tbk (AIR) 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. AIR or any of its affiliates, advisers or representatives
accepts no liability whatsoever for any loss howsoever arising from any information presented 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.
The information contained in this presentation is intended solely for User reference. This presentation contains "Forward Looking"
statements relating to future events, which are inherently subject to risk and significant uncertainty. All statements, except historical
facts contained in this presentation, include but are not limited to statements regarding AIR’s future financial position and results of
operating activities, strategies, plans, goals, objectives and targets, future developments in the Market where AIR participates or
wishes to participate, and other statements that begin with or are followed by the words "believe", "expect", "aim", “intend”, “will”,
“may”, “project”, “estimate”, “anticipate”, “predict”, “seek”, “should” or other similar words and expressions both in English and Bahasa
Indonesia, are statements that are "Forward Looking".
Under no circumstances shall AIR be responsible or liable for the correctness of such material or for damage or loss of opportunity as
a result of use of this material. AIR makes no representations whatsoever regarding the opinions or statements of any analyst or other
third party statements. AIR does not monitor or control the content of third party opinions or statements and does not accept or
assume responsibility regarding anything related to the content or use of such opinions or statements. This presentation does not
constitute an offer to sell or a solicitation of an offer to buy or sell the AIR shares in any jurisdiction.
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Ancora Indonesia Resources:
Providing solutions for a diverse set of resources
across 3 core businesses
PT Multi Nitrotama Kimia (MNK) provides PT Bormindo Nusantara (Bormindo) is an PT Indotan Lombok Barat Bangkit (ILBB)
end-to-end mining services for onshore oil and gas drilling and is a gold and mineral mining company
companies across Indonesia. workover services provider. with a project site in West Lombok.
MNK is the main driver for AIR’s business, The company offers a range of The company has a permit for production
as well as its future growth and drilling-related services, including high operations and is in the process of finalizing
diversification opportunities. pressure well control equipment, special reserves exploration to start infrastructure
drilling pipes, drilling register and monitoring development for production next year.
The company provides end-to-end services systems, top drive drilling and rig transfer
through manufacturing ammonium nitrate equipment. The site has 3 main areas Pelangan and
and nitric acid, developing detonators, as Mecanggah (Epithermal deposit area), and
well as providing mining blasting services. The company has multiple drilling and Selodong (Porphyry deposit area).
workover rigs in operations and is currently
It has manufacturing plants in Cikampek, operating in Duri, Riau.
West Java and Handil, East Kalimantan.
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Financial Highlights Progressing towards strong financial foundation to support future growth
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Financial Highlights: Continued robust top line growth
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Financial Highlights: Stronger balance sheet position
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Financial Ratios: Healthier leverage position overall
Financial Ratio 9M23 9M22 Change
Gross Profit Margin 28,5% 32,7% - 415 bps
Net Profit Margin 8,8% 13,0% - 419 bps
Return on Assets 6,7% 8,4% - 169 bps
Return on Equity 33,3% 115,9% - 8254 bps
Current Ratio 76,1% 65,2% + 1095 bps
Leverage Ratio 9M23 9M22 Change
Bearing Debt to Asset 40,9% 53,4% - 1253 bps
Bearing Debt to Equity 204,4% 741,0% - 53665 bps
Bearing Debt to EBITDA 283,6% 313,8% - 3018 bps
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RKAB vs Current Actual: Hitting our top line targets
Financial Variable (USD million) RKAB 9M23 Actual 9M23 Realization
Revenue 136,11 137,45 100,99%
Gross Profit 39,02 39,17 100,39%
EBITDA 29,66 26,07 87,88%
Net Profit 13,76 12,06 87,65%
Capital Expenditure 12,98 5,86 45,16%
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Operational Highlights
Stronger productivity,
demand, and partnerships
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MNK significant growth supported by growing demand
and production in every aspect of its business
MNK encompasses the majority of AIR’s business and has experienced an increase in growth in sales
across each of its main businesses, reflecting continued trust among our customers.
Double digit growth experienced across each line of the core businesses of MNK.
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Operational Highlights: Productivity growth as the
backbone for continued strong demand
Productivity
Ammonium Nitrate (AN) Debottlenecking & Reliability
● Reached highest ever AN production output, increasing production YoY by 11%,
Record Breaking Detonator Production
● Reached highest ever detonator production output, increasing production YoY by 11%
Increased Rig Utilization
● Increased rig utilization rate YoY by 9%, but still on-going process in increasing rig productivity
Demand
Strong Ammonium Nitrate (AN) Demand
● Aligned with the continued strong coal demand domestically, MNK’s AN customer base increased YoY by 17%
Accessories & Detonator Market Leader
● Supplying 40% of domestic non-electric detonator market
● First and only electronic detonator producer in Indonesia
Strong Interest for Services, but Uncaptured
● Strong interest in drilling services, but unable to fulfill entire user tender requirements due to CAPEX needs
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Operational Improvements: Strengthening partnerships
for sustainable supply and growth
Partnerships
BME (part of Omnia Group)
● Joint venture with BME for blasting services business to improve technical services provision
Auxin Chemical Technology Limited
● Term sheet for joint operation partnership with Auxin to develop booster plant in Handil, East Kalimantan
New Ammonia Supplier
● Partnered with additional Ammonia supplier to ensure sustainable ammonia supply for consistent AN
production for our customers
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MNK joint venture with BME, one of the world’s leading
chemicals and mining services providers to form KMB
BME is part of Omnia group which also leads in the agriculture space and in providing diversified
chemicals, with a focus on research and development, and providing solutions to customers globally.
Synergy: The joint venture with BME is a fitting partnership as it
provides synergy between MNK’s strong ammonium nitrate and
accessories production capability with BME’s advanced blasting
services quality to provide greater end-to-end solutions for our
customers in the long term.
Success: Since the beginning of our joint venture, our customer
base for blasting services has increased by 21%.
Growth: Our partnership with BME and Omnia group allows us
to continue to maintain the highest safety and ESG standards,
be up to date with technology, and have opportunities to expand
into other business development opportunities and markets.
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New Developments Focus towards diversification, completing value chain, and ESG
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MNK signed a term sheet with Auxin to partner on building
a Booster plant in our Handil, Kalimantan complex
Auxin Chemicals Technology, Limited is the largest import and export civil explosive products company in China,
with operations and customers globally.
Construction of the booster plant
will begin in 2024
Through this partnership, MNK aims to be a
manufacturer and provider across another
component of the mining services value chain.
This will allow us to provide a more integrated
mining services solution for our customers and
expand to other markets.
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ILBB has almost completed its JORC process to finalize its
gold reserves exploration
The JORC process will validate the gold reserves capacity in Raja, part of the Epithermal area of ILBB’s
project site, and allow us to move forward with financing for the construction of gold production plant.
98% completed
96% completed
JORC is expected to be completed before mid-2024
We have invested IDR 45 billion (USD 2,9 million), which has allowed us to complete 98% of the drilling for the
JORC process. We are continuing to invest resources to issue the JORC report before mid-2024.
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ILBB has almost completed its JORC process to finalize its
gold reserves exploration
ILBB Project Site Conducting drilling operations to explore the gold potential within the
(Pelangan, Mencanggah, Selodong) Raja prospect area.
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ILBB has almost completed its JORC process to finalize its
gold reserves exploration
Coring samples obtained through drilling are processed and packed into bags to be sent to the laboratory for analysis
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ILBB has collaborated with the local community for
project support, community development, and upskilling
Training on making waste Employing local tailors in the surrounding project Assistance in building a mosque
into organic compost area community to support bagging of gold
reserve samples for exploration process
(up to approximately 5,000 bags)
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Increased focus on ESG through always making safety
priority number one in our operations
Safety
Continued Zero Lost Time Accidents (LTAs)
● Continued zero LTAs with over 13,000 hours YoY increase without LTAs as of Sep. 2023 in AN manufacturing plant
● Continue zero LTAs in Handil accessories manufacturing plant
● Continue to maintain ISO 45001:2018 certification through our health and safety management practices
Significant Incident Decrease
● Improved safety quality with over 70% reduction in number of incidents
● Zero Lost Time Incidents (LTIs) this year, and YoY increase in over 740.000 hours without LTIs as of Oct. 2023
● Increase in over 230.000 safe km driven YoY as of Oct. 2023
● Continue to maintain ISO 45001:2018 certification through our health and safety management practices
Safety Priority During Exploration Process
● Zero Lost Time Accidents (LTAs) this year during exploration process
● Over 93,000 safety manhours with zero accident
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Increased focus on ESG through proactive and
collaborative community development
Community & Diversity
Empowering Local Communities & Diverse Workforce
● Supported local Cikampek infrastructure development including roads, bridges, and orphanage construction
● Continuing to provide sewing classes to upskill and economically empower local community
● Maintaining equal opportunity in workforce, with over 40% women in our Handil, Kalimantan manufacturing
operations and close to 90% local workforce in both Cikampek, West Java and Handil manufacturing operations
Employing and Empowering Local Duri Community
● Employing over 90% workforce local from Duri
● Continue to provide training programs for local Duri workforce, with proven cases of non-skilled local employees
promoted to skilled roles
West Lombok Project Site Community Development
● Employing over 70% local workforce (for direct and indirect roles) for the exploration process
● Employing local tailors in the community to bagging of gold reserve samples for exploration process
● Upskilling local community through training programs for organic waste composting
● Assistance in building local community mosque
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Increased focus on ESG through operational initiatives and
renewables planning to drive energy efficiency
Energy & Water Management
Energy & Water Management
● Finalizing ISO 50001 Energy Management certification, expected to be completed by mid 2024
● Successfully reduced gas and electricity consumption by 21% and 12% respectively over last 3 years
● Currently exploring programs for greater water efficiency to be implemented in 2024
New Digitalization Programs Implemented
● Digitalization programs implemented this year to reduce paper usage by 1,080 pages per month
Energy Management
● New programs and quality controls implemented this year for greater fuel consumption efficiency
Renewables
Solar Panel Installation Plans
● In the process of finalizing a partnership to implement solar panels in our manufacturing plants to reduce energy
consumption by planning to source up to 15% of electricity through renewables
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Increased focus on ESG through commitment to proper
waste management and GHG emission reporting
Hazardous Waste & Chemicals Management
Hazardous Waste & Chemicals Management
● Consistently comply with government standards of hazardous waste and chemical management
● Continue to have no hazardous waste and chemicals incident
● Continue to maintain ISO 14001:2015 certification through our overall environment and hazardous waste
management practices
Hazardous Waste & Chemicals Management
● Continue to maintain ISO 14001:2015 certification through our overall environment and hazardous waste
management practices
● Continue to maintain zero spills in our rig operations for the last 5 years
Greenhouse Gas Emissions
GHG Emissions
● Consistently report our GHG emissions to the government according to their standards each year
● Currently in the process of evaluating future investment into more carbon-efficient catalyst technology to
significantly reduce GHG emission output
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Industry Outlook
Continuing strong demand for relevant
commodities to our businesses
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Ammonia (NH3) and Coal Outlook
From a supply perspective: Ammonia prices have decreased recently, and if it maintains at similar levels in the short
term, it will allow us to optimize our supply chain and contribute to our margins for MNK.
From a demand perspective: Coal prices are projected to decrease over the next 2 years. We still expect strong demand
for coal mining, which will support our core business in MNK both in the short run and long run, but it is important for us to
continue to expand and diversify as a business.
Fertecon (USD/t) Coal ($/Mt)
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Source: World Bank, Fertecon
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Oil and Gas Outlook
Oil and gas is projected to remain at similar levels, opening up opportunities to increase the demand for oil and gas
drilling and maintenance services for Bormindo in the short to medium term.
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Source: World Bank, Trading Economics
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Gold Outlook
Gold prices remain at similar levels and is projected to stay around the same level:
Improving the feasibility for our development in this space through ILBB and future projects in minerals.
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Source: World Bank
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Thank You Contact Us: Equity Tower 41st Floor Sudirman Central Business District (SCBD) Jl. Jend. Sudirman Kav. 52-53 Lot 9 Jakarta Selatan Indonesia 12190 Phone: +62 21 290 35 011 Email: corporate.secretary@ancorair.com Website: www.ancorair.com
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