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November 2016
Golden Agri-Resources LtdCompany Presentation
2slide
Disclaimer
This presentation has been prepared by Golden Agri-Resources Ltd. (“GAR” or “Company”) forinformational purposes, and may contain projections and forward looking statements that reflect theCompany’s current views with respect to future events and financial performance. These views arebased on current assumptions which are subject to various risks and which may change over time. Noassurance can be given that future events will occur, that projections will be achieved, or that theCompany’s assumptions are correct. Actual results may differ materially from those projected. Aprospective investor must make its own independent decision regarding investment in securities.
Opinions expressed herein reflect the judgement of the Company as of the date of this presentation andmay be subject to change without notice if the Company becomes aware of any information, whetherspecific to the Company, its business, or in general, which may have a material impact on any suchopinions.
The information is current only as of its date and shall not, under any circumstances, create anyimplication that the information contained therein is correct as of any time subsequent to the datethereof or that there has been no change in the financial condition or affairs of GAR since such date.This presentation may be updated from time to time and there is no undertaking by GAR to post anysuch amendments or supplements on this presentation.
The Company will not be responsible for any consequences resulting from the use of this presentationas well as the reliance upon any opinion or statement contained herein or for any omission.
© Golden Agri-Resources Ltd. All rights reserved.
3slide
Contents
Corporate Overview 41
Key Competitive Strengths 72
Growth Strategy 173
Financial Performance 204
4slide
Corporate Overview
5slide
Planted Area (as of 30 Sep 2016)1 : 482,228 haOutput of Palm Products (CPO and PK)
YTD Sep 2016 : 1,633,000 MTFY 2015 : 2,967,000 MT
Overview of GAR
Plantation Profile
• Listed on SGX since 1999 • A leading Indonesian plantation group with integrated operations for the production of palm oil-based
edible oil and fat products• It has also operations in China and India including a deep sea port, soybean crushing plants, and
production of refined edible oil products as well as other food products such as noodles
Key Products• Cooking Oil• Margarine• Shortening• Specialty Fats• Stearin• Oleochemicals
• Crude palm oil (CPO)• Palm Kernel (PK)• Palm Kernel Oil (PKO)• Palm Kernel Meal• Soybean Oil and Meal• Biodiesel
Financial Statistics (in US$ million)
Notes:1. Including plasma2. Earnings before tax, non-controlling interests, interest on borrowings,
depreciation and amortisation, net gain/loss from changes in fair value of biological assets and foreign exchange gain/loss.
YTD Sep 2016 FY 2015Revenue : 5,071 6,510EBITDA2 : 393 542Net Profit3,4 : 353 10Equity3,4 : 4,005 3,710
3. The comparative results for FY 2015 has been restated to account for retrospective adjustments arising from the adoption of amended IAS 16 and IAS 41.
4. Attributable to owners of the Company.
6slide
Leading Indonesian Plantation Group with Integrated Operations
Plantations & Harvesting CPO milling
Basic product Processing Processed
product
CPO Refining Branded & Unbranded Cooking Oil
Margarine
Specialty Fats
Palm kernel (PK)
Kernel crushing
Palm Kernel Meal
Planted area1,2
Total 482,228 ha• Nucleus 380,987 ha• Plasma 101,241 ha
Mature area2
465,057 ha
FFB production2
5,744,525 MT (YTD Sep 2016)10,050,626 MT (FY 2015)
No of mills45
Capacity1
12,606,500 MT FFB p.a.
Palm Kernel Oil
Production1,313,981 MT (YTD Sep 2016)2,380,047 MT (FY 2015)
No of plants6Capacity1
4,680,000 tpa
Production319,386 MT (YTD Sep 2016) 586,489 MT (FY 2015)
No of plants9Capacity1
1,425,000 tpa
Notes:1. Data as of 30 Sep 20162. Including plasma
Research & Development
Seedling
Collaborate with CIRAD
Dami Mas Seed Garden
Capacity1
24,000,000 seeds p.a.
Capacity1
240,000 tpa
Oleochemical
Fatty Acids
Glycerine
Biodiesel
Capacity1
300,000 tpa
Biodiesel
Soap Noodle
7slide
Key Competitive Strengths
8slide
482
298 272334
208138
605
179 208333
0
200
400
600
GAR Astra Agro Wilmar Indo Agri(incl
Lonsum)
FirstResources
Sampoerna Sime Darby IOI KLK Felda
Planted
2,380 1,737 1,996
1,002 687
351
2,466
782 861
3,101
0
1,000
2,000
3,000
GAR Astra Agro Wilmar Indo Agri FirstResources
Sampoerna Sime Darby IOI KLK FeldaCPO
Largest plantation group in Indonesia and third largest globally in terms of CPO production 1,2
Notes:1. Based on latest full fiscal year data2. Felda is the largest CPO producer with about 68% of its FFB processed sourced from plasma farmers and other parties
Leading in Scale with Vertically Integrated Operations
Largest plantation group in Indonesia and second largest globally in terms of planted area
Indonesia Malaysia
Indonesia Malaysia
Note: Based on latest publicly available information (including plasma, except Felda)
‘000 MT
‘000 ha
9slide
4.94.7
4.3 4.44.0
3.0
3.5
4.0
4.5
5.0
5.5
GAR Astra Agro FirstResources
Wilmar Indo Agri
(MT
/ha)
21.8 21.7
19.0
21.4
18.2
16
18
20
22
24
GAR Astra Agro FirstResources
Wilmar Indo Agri
(MT
/ha)
Palm is the highest yielding vegetable oil
Management Expertise Delivers High Production YieldsGAR is one of the lowest cost producers with industry-leading efficiencies
Note:1. Based on full fiscal year data
CPO yield per hectare 1,2FFB yield per hectare 1
Notes:1. Based on full fiscal year data2. CPO yield/ha is derived from FFB yield/ha multiply by extraction
rate
Source: Oil World and Company
GAR Age Profile 1
4.9
3.6
0.8 0.7 0.5
0
1
2
3
4
5
Palm Oil(GAR)
Palm Oil(Industry)
Rape Oil Sun Oil Soy Oil
(MT/
ha)
Note:1. Data as of 30 Sep 2016, include plasma. Average age is 16 years
6% 4%8%
43%
39%
17,171
41,027
207,715186,550
29,765
Immature (0‐3 years)Young (4‐6 years)Prime 1 (7‐18 years)Prime 2 (19‐25 years)Old (> 25 years)
10slide
0
500
1000
1500
2000
2500
3000
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
CPO PK
Unrivalled Technology Platform Enhancing Operational Efficiency
• War Room utilises SAP, GIS and Google Earth applications
• Block-by-block Performance Analysis (30 ha per block) is updated daily
• Facilitates problem identification (e.g. low yielding areas), enhancing management’s ability to address issues early and prioritise improvements/changes
To monitor and manage its widely spread operations efficiently, GAR utilises a state-of-the-art proprietary information technology system
Output of Palm Products(‘000 MT)
Note:2010 and 2013 output declined due to unfavourable weather conditions and biological tree stress
1,0391,201
1,3431,433
1,6661,794 1,890
1,9672,073
2,3472,273
2,640
2,9112,768
2,9532,966
11slide
Superior fertiliser cost management through operational control and R&D
• GAR utilises GPS-guided aerial manuring to cover expansive plantation hectarage
• With this advanced aerial manuring, fertilisersare applied more effectively compared to manual application
• Fertiliser program developed with CIRAD1
• Accurate fertiliser plan to optimize benefit especially with more volatile climate conditions
• Application and dosage based on cost/benefit analysis using leaf sampling (“blood test”), analysing condition of each plantation
Note:1 CIRAD = Centre de cooperation Internationale en Recherche Agronomique pour le Développement
(French Agricultural Research Centre for International Development)
Unrivalled Technology Platform Optimising the Production Yields and Minimising Cost
12slide
Strong Position Across the Downstream Value Chain
Note:1. Data as per 30 Sep 2016
New biodiesel plant is in operation with capacity of 300k tpa
Sales of palm based refined products increased by 31% year-on-year as refinery capacity expanded
Destination sales contributed 76% to our export volume with our focus on enhancing destination sales capabilities and initiatives
Sourcing of raw materials Processing
Product customisation
Sales and distribution
Maintained sales volume of palm-based products at6.5 million tonnesfor YTD Sep 2016 period
13slide
Strong Commitment to the Environment and Community for Sustainable Palm Oil
Sustainable Practices for Existing Plantations Zero waste policy by recycling of mill wastes
(Empty Fruit Bunch and Palm Oil Mill Effluent) Precise dosage in fertiliser application plan to
minimise risk of pollution Integrated pest management by deploying
biological controls to minimise and mitigate the impact of chemical pesticides
No deforestation footprint in our palm oil operations by not developing on: High carbon stock (HCS) forests High conservation value (HCV) forest areas Peat lands of any depth
Enhanced Planting Procedures
Continuous yield improvement in nucleus and plasma plantations managed by the Company Zero burning policy in land clearing Ensure free, prior and informed consent for indigenous and local communities Comply with all relevant laws and National Interpretation of RSPO Principles and Criteria
14slide
Towards Sustainable Palm Oil Production
Progress on fully traceable palm oil Traceability to the Plantation (TTP) data for GAR-owned mills reported on the Sustainability Dashboard. (GAR already knows 90% of the source of palm oil to its mills) 2nd SMART SEED workshop held in Medan in September for over 80 suppliers – part of supplier engagement and education
Fire preventionNo major fire incidents in the 2016 dry seasonSporadic fire incidents are reported on the Sustainability DashboardDesa Siaga Api community outreach programme to tackle fire and haze to be evaluated before end 2016
15slide
Empowering Communities
Employment• GAR provides employment for about 174,000 people in Indonesia
• 49,000 direct employees, 67,000 smallholders and 58,000 casual workers• We promote small and micro enterprises near our operation areas
Education• Contributed more than US$2.5 million to fund scholarship programmes in 2015
Facilities and infrastructure
The palm oil industry is effective in creating jobs and alleviating poverty
16slide
Growth Strategy
17slide
Strategic Priorities
Build on core competitive strengths and leverage scale to maximize long-term shareholder returns
Continued strong commitment to environmental and social responsibility
To strengthen our position as the world’s leading palm oil plantation company
Accelerate presence and optimise margins in every sector of the value chain
Be the best, fully-
integrated, global
agribusiness and
consumer product
company –the Partner of Choice
Leading global merchandiser for
Indonesia palm oil products while
focusing on higher margin customers
World class producer of
diversified value added, quality and
sustainable products
Deliver value added services and solutions to
customers
Cost Efficiency –mechanisationand automation
Yield Improvement –
research and development
Operational Excellence –best-in-class
plantation management
18slide
Growth Strategy and Outlook
Upstream• Focusing on replanting with higher-yielding seeds to sustain production growth• Continued efforts in yield improvement, cost efficiency and sustainability initiatives• Projected 2016 capex US$70 million
Downstream• Extending product portfolio, distribution coverage and global market reach as well
as logistic facilities to enhance our integrated operations• Constructing new biodiesel processing capacity• GAR is evaluating strategic alternatives and business model adjustment for China
oilseed business• Projected 2016 capex US$110 million
Outlook• GAR remains confident with the robust demand growth for palm oil in the long term • We expect CPO price to remain supported by lower production due to El Nino and
implementation of Indonesia biodiesel mandate
Capitalising on the robust fundamentals of the industry, GAR continues to enhance its integrated operation capabilities to optimise profit opportunities across the value chain
19slide
Financial Performance
20slide
Financial Performance
Notes:1. The comparative results for YTD Sep 2015, FY 2015 and FY 2014 have been restated to account for retrospective adjustments arising from the adoption of amended IAS 16
and IAS 41.2. Based on weighted average numbers of shares.3. Earnings before tax, non-controlling interests, interest on borrowings, depreciation and amortisation, net gain/loss from changes in fair value of biological assets and foreign
exchange gain/loss. The comparative EBITDA for FY 2014 has been recalculated to include share of results of associated companies and joint ventures, net of tax to conform with current period’s presentation.
• Year-on-year performance affected by the drop in harvested fruits and the implementation of export levy starting in July 2015
• Net profit in 2016 lifted by the deferred tax income arising from tax-based asset revaluations
(in US$ million) YTD Sep2016
YTD Sep20151 20151 20141
Revenue 5,071 4,958 6,510 7,619
Gross Profit 707 736 1,005 1,178
Gross Profit Margin 14% 15% 15% 15%
Operating Profit 98 131 172 222
Tax 215 9 11 (48)
Net Profit attributable to owners of the Company 353 (9) 10 93
Net Profit per Share (in US$ cents)2 2.77 (0.07) 0.08 0.73
EBITDA3 393 401 542 566
EBITDA margin 8% 8% 8% 7%
21slide
Segmental Results
Notes:1. Products from upstream2. Processing and merchandising of palm based products, i.e. bulk and branded products as well as oleochemicals3. Processing and merchandising of oilseed based products, i.e. bulk and branded products 4. Other consumer products in China and Indonesia such as food and beverages5. Earnings before tax, non-controlling interests, interest on borrowings, depreciation and amortization, net gain from changes in fair value of biological assets, as well as
foreign exchange gain/loss. The comparative EBITDA for FY 2014 has been recalculated to include share of results of associated companies and joint ventures, net of tax to conform with current period’s presentation.
US$ millionYTD Sep
2016YTD Sep
2015 2015 2014
RevenuePlantation and palm oil mills1 978 1,132 1,503 1,927Palm and lauric2 4,425 4,445 5,614 6,464Oilseeds3 490 468 644 845Others4 143 151 193 201Inter-segment eliminations -964 -1,237 -1,444 -1,818Consolidated Revenue 5,071 4,958 6,510 7,619
EBITDA5
Plantations and palm oil mills1 239 307 416 56124% 27% 28% 29%
Palm and lauric2 135 83 109 573% 2% 2% 1%
Oilseeds3 16 8 11 -603% 2% 2% -7%
Others4 2 2 5 81% 1% 3% 4%
Eliminations 0 1 1 0Consolidated EBITDA5 393 401 542 566
22slide
Financial Position
Gearing remains prudent after the adoption of amended IAS 16 and IAS 41 starting 2016
Notes:1. The comparative figures for 31 Dec 2015 have been restated to account for
retrospective adjustments arising from the adoption of amended IAS 16 and IAS 412. Includes Bearer Plants, Property, Plant and Equipment, and Investment Properties3. Interest bearing debt less cash, short-term investments and liquid working capital4. Interest bearing debt less cash and short-term investments
5. Trade receivables, inventories (excluding consumables), deposits and advances to suppliers less trade payables and advances from customers
6. Equity attributable to owners of the Company7. 30 Sep 2016 figure is based on annualised EBITDA.
(in US$ million) 30-Sep-16 31-Dec-151 Change
Total Assets 8,367 8,036 4%
Cash and short-term investments 388 502 -23%Fixed Assets2 3,973 4,071 -2%
Total Liabilities 4,318 4,286 1%
Adjusted Net Debt3 1,783 1,908 -7%
Net Debt4 2,615 2,543 3%Liquid Working Capital5 832 635 31%
Total Equity Attributable to Owners of the Company 4,005 3,710 8%
Adjusted Net Debt3/Equity6 Ratio 0.45x 0.51xAdjusted Net Debt3/Total Assets 0.21x 0.24xAdjusted Net Debt3/EBITDA7 3.40x 3.52xEBITDA/Interest 4.13x 4.21x
23slide
Contact Us
Golden Agri-Resources Ltdc/o 108 Pasir Panjang Road#06-00 Golden Agri PlazaSingapore 118535
Telephone : +65 65900800Facsimile : +65 65900887
www.goldenagri.com.sg
Contact Person : Richard Fung richard@goldenagri.com.sg
If you need further information, please contact:
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