PT. BAYAN RESOURCES Tbk. - bayan.com.sg fileBayan Adaro PTBA Indika ITMG Golden Energy 2017 EBITDA...

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Bayan’s Transformation

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Financial Performance

Revenue (in million USD) 555.5 1,067.4 ↑ 92%

Gross Profit (in million USD) 210.4 553.6 ↑ 163%

EBITDA (in million USD) 166.8 485.1 ↑ 191%

Net Profit After Tax (in million USD) 18.0 338.0 ↑ 1776%

Financial Ratios

Gross Profit Margin (%) 37.9% 51.9% ↑ 37%

EBITDA Margin (%) 30.0% 45.4% ↑ 51%

Net Profit Margin (%) 3.2% 31.7% ↑ 876%

Net Debt to EBITDA (x) 2.6 0.1 ↓ (97%)

Operational Statistics

Overburden Removal (MBCM) 32.8 84.9 ↑ 159%

Strip Ratio (x) 3.4 4.1 ↑ 21%

Coal Production (Million Tones) 9.7 20.9 ↑ 115%

Sales Volume (Million Tones) 13.0 20.1 ↑ 55%

% Change2016 2017

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One of the Quickest Growing Coal Producers

Bayan is currently in the top ten coal producers in Indonesia with a view to moving into the top 3 within the next few years.

2017 completed the initial phase of infrastructure to allow Bayan to continue to be one of the quickest growing producers.

MT

2017 Production

86.0

51.8

32.0 24.2 22.1 20.9 15.6

0

40

80

120

Bumi Adaro Indika PTBA ITMG Bayan GoldenEnergy

Source: Company Filings, Company Data

2015 - 2017 CAGR (Production)

33.2 29.6

13.9

2.0

(2.7) (7.4) (8.8) -9-416

1116212631

GoldenEnergy

Bayan PTBA Bumi Adaro Indika ITMG

Source: Company Fillings. Company Data

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One of the Lowest Cost Producers in Indonesia

2017 Strip Ratio Competitors (x)


Global Cost Competitive Positioning

Source: Wood Mackenzie, Company Data

1.5

3.6 4.0 4.1 4.6

6.0

7.2

11.1

0

2

4

6

8

10

12

Tabang PTBA GoldenEnergy

Bayan Adaro Kideco Bumi ITMG


2017 EBITDA Margin (%)

45.7 40.0

33.8 28.6 26.5 24.3

0

10

20

30

40

50

Bayan Adaro PTBA Indika ITMG GoldenEnergy

2017 EBITDA (Million USD)

1,302.0

734.0

486.0 485.1 448.0

184.0

0

200

400

600

800

1,000

1,200

1,400

Adaro Indika PTBA Bayan ITMG GoldenEnergy


0

10

20

30

40

50

60

70

80

90

200 400 600 800

To

tal C

ash

Co

st

(US

$/t

No

min

al)

RoW Indonesia Australia Bayan Seaborne Export Supply (MT)

4

Net Debt / EBITDA

x

10.2x

5.8x

2.6x

0.1x

0

5

10

15

2014 2015 2016 2017

1.3x 2.7x

3.7x

16.8x

0

4

8

12

16

20

2014 2015 2016 2017

EBITDA / Net Interest Expense

x

Management prudently utilised the significantly improved financial performance to deleverage the Group.

The Group now has the financial strength to continue with the next phase of expansion of Tabang.

Targeted leverage of less than 2x EBITDA throughout the commodity cycle.

Deleveraged the Group

5

Low Cost Incremental Growth

Able to continue expansion using existing infrastructure whilst building for the next phase is completed.

New coal haul road and barge loading facility targeted to the constructed and brought into operations in 2021 which will double existing capacity.

Budgeted capex in the region of USD 255 in the next three years.

10

23

32

50

65 71

85

96 98

110

130

159 161

175

207

218

0

50

100

150

200

250

25.0

50.0+

Today Upside

…Unlocking tangible capacity

upside at ~US$10/ton

discretionary growth Capex

Tabang Capacity Growth

Capex Intensity by Country (1)

Source: Wood Mackenzie

Notes

(1) Based on 2012 real dollars

(2) US$255m Capex divided by an incremental 25+ Mtpa production / sales capacity

6

4Q 2017

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Overburden Removal

Coal Production

Weighted Average Strip Ratio

Average Cash Costs

Coal Sales

Average Selling Price

Committed & Contracted Sales

EBITDA

Net Debt and Cash Position

Capital Expenditure

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Overburden Removal (OB)

(in million BCM) 4Q17B 4Q17

Teguh Sinar Abadi / Firman

Ketaun Perkasa5.8 12.2

Perkasa Inakakerta 1.7 2.2

Tabang Concessions 5.6 8.0

Gunung Bayan 1.5 1.1

Wahana Baratama Mining 3.9 3.8

Total 18.4 27.3

4Q17 Overburden removal and 2017 significantly above Budget

(million BCM)

Note : B stands for Budget Figure

9.2

27.3

0.0

5.0

10.0

15.0

20.0

25.0

30.0

4Q16 4Q17B 4Q17

18.4

4Q17 OB was 27.3 million BCM which was slightly higher than 3Q17 levels despite being significantly impacted by high rain levels, especially at Tabang.

Considerably above the Budget as the Group pushed to meet stretch targets.

8

Coal Production

3.0

6.1

0.0

1.0

2.0

3.0

4.0

5.0

6.0

4Q16 4Q17B 4Q17

4.5


(in million MT) 4Q17B 4Q17

Teguh Sinar Abadi/ Firman






Total 4.5 6.1

2017 coal production of 20.1 million MT exceeded Budget by 18%

(million MT) 4Q17 coal production of 6.1 million MT was lower than 3Q17 production due to very high rain levels which significantly impacted Tabang’s operations.

4Q17 coal production of 6.1 million MT was higher than the Budget due to all sites pushing to reach the stretch targets.

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Weighted Average Stripping Ratio (SR)

4Q17B 4Q17

Teguh Sinar Abadi / Firman






Total 4.1 4.5

Weighted Average SR (:1)

3.1

4.5

0.0

1.0

2.0

3.0

4.0

5.0

4Q16 4Q17B 4Q17

4.1


Low stripping ratio when compared to our competitors

4Q17 weighted average stripping ratio of 4.5:1 was higher than 3Q17 and above the Budget mainly due to WBM operating in a higher SR area and TSA/FKP operates at a higher SR due to geotechnical issue.

However the years average of 4.1:1 was one of the lowest compared to our competitors.

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Average Cash Costs

28.9 32.3

0.0

10.0

20.0

30.0

40.0

4Q16 4Q17B 4Q17

29.4


Average Cash Costs include Royalty, Barging and SGA

2017 cash cost of USD 29.0 remained below Budget

4Q2017 Cash Costs were US$ 32.1/MT, which was slightly higher than the 3Q2017 and the Budget mainly due to:

• Higher royalty due to higher ASP

as coal prices remained strong.

• Increasing fuel prices.

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Coal Sales (by volume)

3.9

6.1

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

4Q16 4Q17B 4Q17

5.1

(million MT)


Geographic Distribution

(4Q17) (YTD)

India

27%

China

16%

Malaysia

13%

Korea

13%

Vietnam

1%

Indonesia

14%

Philippines

8%

Others

7% India

28%

China

13%

Malaysia

13%

Korea

15%

Vietnam

1%

Indonesia

14%

Philippines

9%

Others

8%

2017 sales volumes of 20.1 million Mt exceeded Budget by15%

4Q17 coal sales volumes of 6.1 were higher than 3Q17 and 4Q17B as sales were made in advance on the back of increased production levels in the previous quarters.

India and China are the top two destinations in 4Q2017.

Top customers 4Q2017 and YTD (by sales volume) are: TNB Fuel Service Sdn. Bhd., Mercuria Energy and Noble Resources.

Indonesian domestic sales are becoming more significant due to continued effort to support GoI expansion program.

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Average Selling Price (ASP)

45.8

57.5

0.0

10.0

20.0

30.0

40.0

50.0

60.0

4Q16 4Q17B 4Q17

37.8

2017 ASP of US$ 53.1/MT exceeded the Budget as the Company benefited from continued higher benchmark prices


(U

S$

/ M

T)

ASP includes coal and non-coal sales *

4Q17 ASP of US$ 57.5/MT was higher than 3Q17 of US$ 52.3/MT and the Budgeted ASP of US$ 37.8/MT due to :

• Coal prices remaining strong into the 4Q2017 whilst the Budget anticipated a weakening coal price.

• Combined with significant element of unfixed sales book.

Partially offset with:

• Lower CV than the Budget (4,569 GAR vs 4,653 GAR) as the proportion of Tabang was higher than the Budget as we exceeded Budgeted production volumes.

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Committed and Contracted Sales for 2018

2018

Fixed Price Floating Price

18.1 million MT

21%

79%

Contracted sales already underpin 2018 growth

Strong demand and contacted volumes underpin 2018 volumes.

As at 31 December 2017 the Group had committed and contracted sales volumes of 18.1 million MT with an average CV of 4,606 GAR kcal which underpins the Group 2018 sales volumes.

Additional sales will be made as production levels continue to grow throughout 2018.

2018 Fixed Price element at US$ 48.71/

MT with an average CV of 4,467 GAR kcal.

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EBITDA

32.9

153.3

0.0

50.0

100.0

150.0

200.0

4Q16 4Q17B 4Q17

46.5

EBITDA Margin (%) Competitors Table

45.4 40.0

33.8 28.6 26.5 24.3

0

10

20

30

40

50

Bayan Adaro PTBA Indika ITMG GoldenEnergy

One of the best EBITDA margin’s in Indonesia

4Q17 EBITDA of USD 156.3m exceed the 3Q’s results and was the highest of the year.

The 2017 EBITDA of USD 485.1m exceeded some of the larger, more established Indonesian coal producers.

EBITDA margin in excess of 45% is one of the best in Indonesia.


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318.3

263.1

177.1

40.6

119.9

156.2

108.2

71.2

0.0

50.0

100.0

150.0

200.0

250.0

300.0

350.0

1Q 2Q 3Q 4Q

Net Debt Cash and Restricted Cash

Net Debt and Cash - 2017

Deleveraged the Company

(in

millio

n U

S$

)

As of 31 December 2017, fully prepaid all existing long term debt.

Drew down USD 100 million under new Permata Working Capital facility.

The Group leverage significantly reduced, Net Debt to EBITDA Ratio of 0.1x.

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Capital Expenditure

50.1 48.9

-

10.0

20.0

30.0

40.0

50.0

60.0

Budget YTD

Minimal Capex required to achieve growth

In

Mil

lio

n U

SD

Capex YTD was US$ 48.9 million, which was slightly below the Budget.

Majority of spend was at Tabang related to infrastructure at:

• Senyiur Jetty

• Improvement of the CHR

• Additional Equipment & Machinery.

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PT Gunungbayan Pratamacoal GBP

PT Perkasa Inakakerta PIK

PT Teguh Sinarabadi TSA

PT Firman Ketaun Perkasa FKP

PT Wahana Baratama Mining WBM

PT Fajar Sakti Prima FSP

PT Bara Tabang BT

PT Brian Anjat Sentosa BAS

PT Tanur Jaya TJ

PT Silau Kencana SK

PT Orkida Makmur OM

PT Tiwa Abadi TA

PT Sumber Api SA

PT Dermaga Energi DE

PT Bara Sejati BS

PT Apira Utama AU

PT Cahaya Alam CA

PT Mamahak Coal Mining MCM

PT Bara Karsa Lestari BKL

PT Mahakam Energi Lestari MEL

PT Mahakam Bara Energi MBE

Appendix

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Appendix

PT Graha Panca Karsa GPK

Kangaroo Resources Limited KRL

PT Dermaga Perkasapratama DPP

PT Indonesia Pratama IP

PT Muji Lines Muji

PT Bayan Energy BE

PT Metalindo Prosestama MP

PT Sumber Aset Utama SAU

PT Karsa Optima Jaya KOJ

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Disclaimer

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This presentation contains forward-looking statements based on assumptions and forecasts made by PT. Bayan Resources Tbk management. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. These statements are based on current plans, estimates and projections, and speak only as of the date they are made. We undertake no obligation to update any of them in light of new information or future events. These forward-looking statements involve inherent risks and are subject to a number of uncertainties, including trends in demand and prices for coal generally and for our products in particular, the success of our mining activities, both alone and with our partners, the changes in coal industry regulation, the availability of funds for planned expansion efforts, as well as other factors. We caution you that these and a number of other known and unknown risks, uncertainties and other factors could cause actual future results or outcomes to differ materially from those expressed in any forward-looking statement.

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Thank You

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