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PT Adaro Minerals Indonesia Tbk
Public Expose
Monday, November 27, 2023
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Disclaimer
These materials have been prepared by PT Adaro Minerals Indonesia 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 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.
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. These statements can be recognized by the use of words such as
“expects,” “plan,” “will,” “estimates,” “projects,” “intends,” or words of similar meaning. 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.
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Business Overview
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PT Adaro Minerals Indonesia Tbk at a Glance
Indonesia's top metallurgical coal producer, with an industry-leading cost structure and growing client
base. We are also developing an Aluminium Smelter at the Kalimantan Industrial Park Indonesia in
North Kalimantan, as our first step in supporting the Government’s downstream initiatives.
Large coal reserves and resources, supporting long-term sustainable growth. Coal reserves: 165.4 Mt.
Coal resources: 975 Mt.*
Strong demand profile from blue-chip steel companies. Customers are primarily from Asian countries
including Japan, China, India, South Korea, and Indonesia.
Offers coal supply diversification for customers and close proximity to key markets, reducing
transportation times and enabling a competitive cost structure.
Consistent volume growth in the medium term, reaching 6 Mt in 2025.
Developing an aluminium smelter project, with planned total capacity of 1.5 Mt, supporting the
Indonesian government’s downstream initiatives for batteries and electric vehicles ecosystem.
*Coal Reserves and Resources data is as of August 2021 from independent consultant PT Quantus Consultants Indonesia
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Company Overview
CCoWs Locations Coal Resources and Reserves
Total Coal Total Coal
Compliance
Company / Locality Reserves Resources
Standard
(Mt) (Mt)
Lahai Coal - Haju
2.3 4.3 JORC
(Metallurgical)
Maruwai Coal - Lampunut
84.3 100.3 JORC
(Metallurgical )
Juloi Coal - Juloi Northwest
- 629.9 JORC
(Metallurgical)
Juloi Coal - Bumbun
55.5 174.5 JORC
(Metallurgical)
Kalteng Coal - Luon
17.7 50.9 JORC
(Metallurgical)
Sumber Barito Coal - Dahlia Arwana
5.6 15.0 JORC
(Metallurgical)
TOTAL 165.4 975.0
Coal production (in million tonnes)
5.0
55% 4.0
4.0 3.4
3.0 2.3 2.6
1.9
2.0
1.1
1.0
0.0
2019 2020 2021 2022 9M22 9M23
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Established Infrastructure
to Ensure Operational Excellence
Lampunut Coal Handling and Processing Plant
Crushing Plant : 600 tph
One of the largest CHPPs in
Indonesia in terms of capacity
Reduces ash from 12% ad to 4.5% ad
Washing Plant : 525 tph (max: 550 tph)
WASHING – 3 Process Circuit
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Our ongoing Investment in Facilities
and Infrastructure
Hauling road progress Barge loading conveyor area Employee dorms’ construction
Washing Plant : 525 tph (max: 550 tph)
Our projects in Maruwai Coal (MC) and Lahai Coal (LC) continue the ongoing investment in facilities and infrastructure
through the upgrading of our hauling roads, expansion of fuel storage facilities, and staff accommodation.
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Supply Chain: from Coal Terminal to Vessel
Loading Points
Barge-to-barge Barge-to-Barge
▪ Barge-to-Barge transfers are done at
Tuhup Port Taboneo and North Kelanis using FC
A Hasan Basri
Barge-to-Vessel
B Tumpung Laung
Barge-to-Vessel (Taboneo)
C Kalahein Bridge
▪ Safe for loading for a wide range of
Teluk TimbauISP- ISP vessel sizes
▪ Floating Office at Permata Barito
Indonesia Bulk Terminal Indonesia Bulk Terminal
▪ Located at Pulau Laut Southeastern
coast of South Kalimantan.
▪ 11 Mtpa capacity
▪ Up to 82kt DWT
Taboneo ▪ Dedicated stockpiles of 640kt
Anchorage
Indonesia
Bulk Terminal 8
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The Value of the Green Economy
Substantial investment opportunities in Indonesia
Value at stake Growing demand for
Green economy Green minerals
$3T
Investment in renewable energy
by 2030
$800B
Global EV sector by 2030
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The Green Economy
Driving demand for green minerals
Electric vehicle Wind technology Solar technology
13 28 3 26 13 14 13
AI Ni Li Fe AI Si AI
Aluminium Nickel Lithium Iron Aluminium Silicon Aluminium
More Aluminium used in electric Metallurgical coal needed to produce Polysilicon needed for each MW
30% vehicles than internal combustion
90 Steel for each MW of wind power
7 solar PV plant
engines tons tons
35 kg Nickel needed in a single car lithium-ion
battery pack
50- 120 Steel needed for each MW of wind
power (depending on offshore or 4M Aluminium demand from the solar
power sector by 2040
tons onshore) tons
Lithium needed in a single car lithium-
8 kg ion battery pack
1 ton Aluminium for 1 MW of wind turbine
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Developing Our Green Minerals Business
Increasing revenue contribution from minerals used within the EV and battery supply chains
Supporting the Government’s downstream initiatives in green industry and the processing of minerals
Our first step is via Aluminium smelting project, with gradual development to reach 1.5 Mtpa
capacity
Positive LT outlook of aluminum as supporting materials in many industries such as automotives, EV
battery, constructions, etc.
Through this project, could reduce Indonesia’s dependency on aluminum imports, creating job
opportunities and contributing to green industrial development
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Aluminum Smelter in Kalimantan Industrial
Park Indonesia
Scope of project is 1.5 Mtpa of Aluminum production
Additional capacity of up to
500,000 tpa of Green
Aluminum. Adaro plans for this
Additional production to be powered by hydro.
capacity of up to 500,000 tpa
aluminum.
Adaro may invest in the
smelter’s power generation.
Power generation is under
Production capacity: 500,000 tpa discussion but will likely be a
aluminum. Adaro plans to invest in the hybrid of coal and renewables.
smelter’s power generation.
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Progress of Aluminum Smelter
• Smelter: KAI started the piling works for the foundation
of the aluminium smelter area. In 4Q23, KAI will
continue to work on the earthworks and land levelling.
• Jetty: finished coastal jetty breakwater, and will
continue work on dredging and piling work, construction
for heavy cargo, universal cargo and berthing trestle.
• Power plant: conducting piling works at power plant
area.
• Supporting facilities
o Completed the land clearing for the permanent dorm
o Completed temporary housing installation
o Completed construction of ancillary facilities such as
batching plant, outdoor laydown warehouse, heavy
equipment workshop, and brick factory.
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Global Supply and Demand Balance
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Solid Performance in HSE
• ADMR implements the Adaro Group’s Adaro Zero
Accident Mindset (AZAM) which emphasizes on
continuous improvements in safety SOPs to improve
workers’ behavior.
PT KAI continues its construction progress while
consistently emphasizing health and safety
governance for each operational activity.
Indicator MC & LC KAI
LTIFR 0.46 0
SR 17.17 0
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CSR and Green Initiatives
• ADMR applies Adaro Group’s “Adaro Ignites Change” CSR
initiatives and Adaro Group’s initiatives in ESG.
• To improve ESG performance, and as the first step towards
energy efficiency, ADMR and Adaro Power are actively in the pre-
feasibility study phase of installing a mini-hydro power plant at our
mining site.
• As another initiative related to ESG aspects, ADMR also actively
educates students at mentored schools in Laung Tuhup and
Bastura districts on safe driving and promotes a hygienic and
healthy lifestyle.
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Industry Overview
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Strong Market Fundamentals Have Held Prices
Elevated
Price Trends
800.00
• The year-to-date average of Premium low-volatile
700.00 hard coking coal FOB Australia price declined by
22% year-on-year. Despite the decline,
600.00 metallurgical coal prices remain well supported,
500.00
reaching nearly US$300/mt on average. Shortage
US$/tonne
of supply from Australia as well as robust demand
400.00 from China, India, Southeast Asia are the main
drivers.
300.00
200.00 • Overall demand for ADMR’s premium hard coking
coal product remains strong, as reflected on the
100.00 sales growth of 38% year-on-year at 3.01 million
tonnes by 9M2023.
0.00
Sep-22
Sep-23
Jul-22
Jan-22
Mar-22
May-22
Jan-23
Mar-23
May-23
Jul-23
Nov-22
HCC PLV FOB Australia HCC PLV CFR China Nov-23
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Metallurgical Coal
Seaborne Demand and Supply Outlook
Demand Forecast Supply Forecast
350.0 350.0
300.0 300.0
250.0 250.0
Million Tonnes
200.0 200.0
150.0 150.0
100.0 100.0
50.0 50.0
0.0 0.0
2022 2023 2024 2025 2026 2027 2028 2029 2030 2022 2023 2024 2025 2026 2027 2028 2029 2030
China India Japan South Korea Europe Others Australia Canada United States Mongolia
Sources: Adaro Analysis Russia Mozambique Indonesia Others
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Operational & Financial Highlight
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Strong Production & Sales
Growing Production with Low Strip Ratio Expanding Sales (in million tons)
3.2 +38%
13.8 3.0
2.3 2.2
1.4
1.0
8.4 8.3
2019 2020 2021 2022 9M22 9M23
7.7
6.1 Broad Market Demand (9M23)
5.2
4.2 4.0
3.4
2.3 2.6 3.5 Others 21%
1.9
1.1 2.2 2.2 2.5 2.4 Japan 33%
India 20%
2019 2020 2021 2022 9M22 9M23
China 26%
Overburden removal (in million bcm) Coal production (in million tonnes)
Strip ratio
Others: Indonesia and Korea
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Improved and Solid Performance
Improved Sales Volume Supports Higher Royalties Solid Financial Condition
373.2
34.9%
341.0 9M23
52.7%
43.1%
9M22
62.2%
251.6
219.7 37.0%
2022
58.9%
134.5 34.1%
121.9 2021
52.3%
74.6 -23.2%
48.4 -9.1%
25.6 24.7 26.4
15.6
-0.8%
-11.6%
2019 2020 2021 2022 9M22 9M23
Cost of revenue (in $ million) Operating expense (in $ million) Net profit margin Gross profit margin
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Continue to Deliver Consistent Results
OPERATIONAL PERFORMANCE 9M23 9M22 Change
Production (Mt) 4.0 2.6 55.2%
OB removal (Mbcm) 13.8 6.1 128.2%
Sales (Mt) 3.0 2.2 37.7%
FINANCIAL PERFORMANCE 9M23 9M22 Change
(in US$ million, expect Earning per share)
Net revenue 720.6 666.5 8.1%
Gross profit 379.6 415 -8.5%
Net profit 251.5 287.2 -12.4%
Operating Income 333.3 387.7 -14.0%
Operational EBITDA 358.6 411.5 -12.9%
Interest bearing debt 405.4 561.5 -27.8%
Net debt -176.4 159.7 -210.5%
Capital expenditure 95.7 4.9 1872.6%
Cash 581.9 401.8 44.8%
Free cash flow 152.0 253.0 -39.9%
Earnings per share (full amount) 0.0061 0.0070 -12.9%
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Continue to Deliver Consistent Results
FINANCIAL RATIO 9M23 9M22 Change
Gross profit margin 52.7% 62.2% 9.6%
Net profit margin 34.9% 43.1% 8.2%
Operating margin 46.2% 58.2% 11.9%
Operational EBITDA margin 49.8% 61.7% 12.0%
Net debt (cash) to equity -0.21x 0.33x -163.2%
Net debt (cash) to last 12 months Operational EBITDA 0.49x 0.39x -226.8%
Cash from operations to capex 2.39x 62.97x -96.2%
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FY23 Projections
Coal Capital
Production Strip ratio Expenditure
(in Mt) (in $ million)
9M23A FY23F 9M23A FY23F 9M23A FY23F
4.0 3.8-4.3 3.5 3.8 95.7 70-90
• ADMR’s performance is in line with the Company’s FY23 projections.
Coal production has almost reached the FY23 target in 9M23 of around 90%.
• Strip ratio was inline with the guidance driven by the higher overburden removal
in 9M23.
• Capex realization has exceeded the full-year guidance due to MC’s infrastructure
and the ongoing construction of the aluminum smelter under KAI.
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Conclusions and Takeaways
• ADMR’s competitive strengths include: (i) a large coal reserve and resource, (ii) premium product quality, (iii) a growing
client base amongst blue-chip steel companies, and (iv) industry-leading cost structure.
• Production volume in 9M23 reached 3.98 million tonnes, up 55% year-on-year, with sales reaching 3.01 million tonnes,
reflecting 38% year-on-year increase.
• Capital expenditure in 9M23 reached $95.7 million as we advanced construction of PT Kalimantan Aluminium Industry’s
(KAI) aluminium smelter whilst infrastructure projects at PT Maruwai Coal (MC) continue to progress.
• As of the third quarter of 2023, ADMR’s performance is in line with the 2023 projections.
• The aluminium smelter project under KAI is currently progressing well with the piling works as well as the construction
of other infrastructure related facilities.
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Thank you
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