1

COMPANY PRESENTATION

PT Semen Indonesia (Persero) Tbk

March 2019

Table of Content

Indonesia Cement Industry

Indonesia Cement Players

SMGR as the Market Leader in Indonesia

Indonesia Cement Market

Market by Geography 2018

SMGR Strategy and 9M 2018 Performance Result

Strategic Business Priorities 2019

Key Strategy 2018

Performance Overview 9M 2018

SMGR Financial Position

Acquisition of Holcim Indonesia

Experienced Board of Management

Installed Capacity

Indonesia’s Cement Players

Total

108.1 Mio

Ton

SMGR market share 2018 was 39.4% despite of only 33.2% capacity share

2018

Semen Indonesia

SBI (ex Holcim Indonesia)

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SMGR as the Market Leader in Indonesia

2

SMGR is the market leader in Indonesia with a market share of 39.4% in 2018 despite having only

33.2% capacity share. The top three players in Indonesia’s cement industry dominates 80.3% of

domestic market share. With the acquisition SMCB, our market share will increase by around

15%.

33,2%

23,0%

13,7%

4,9%6,8% 6,8%

3,6%1,4% 1,7% 1,8%

0,3%2,9%

39,4%

25,5%

15,4%

4,8% 3,5% 3,1% 3,1% 1,9% 1,9% 1,0% 0,3% 0,1%

SMGR INTP SMCB Conch Bosowa Merah Putih Baturaja Jui Shin SiamCement

STAR SemenKupang

Others

Capacity Share Market Share

18.9 21.5 24.6 25.3 26.2 27.5 28.9 30.5

26.530.3 32.6 33.7 34.5 33.4 37.4 39.0

21.94.6%

17.6%

14.4%

5.5%3.5% 3.5%

28.2-0.6%

7.6%4.8%

2010 2011 2012 2014 2015 2017 20182013

OutsideJava Java

2016

Growth

32.8 34.239.2

44.1 45.7 46.9 47.5 46.8 49.4 50.8

6.2 6.6

8.8

10.812.2 13 14.5 14.8

16.9 18.830.0%

25.0%

20.0%

15.0%

10.0%

5.0%

0.0%

-5.0%

20

10

0

60

50

40

30

80 40.0%

Bulk Vol

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Bag Vol Growth Bag Growth Bulk Bulk Portion

CAGR Bulk: 13.1%

70 CAGR Bag: 5% 35.0%

Retail (residential) sector is still the largest consumer of cement in Indonesia.

Bulk cement growth is higher than bag cement in the last two years. Bulk demand

growth 2018 was 11% while demand for bag was 2.7%.

Government infrastructure budget is significantly increasing since 2015 along with the

5 years National Strategic Projects.

Indonesia Cement Market

BAG

73%

BULK

27%

source: Indonesia Cement Association

Bag cement still represent the largest portion of

Indonesia cement consumption

Cement demand growth was dominated by the growth of bulk

cement to support infrastructure projects.

86114

146

184 178

290317

388410 415

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

Infrastructure Budget

CAGR: 6.6%

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source: Indonesia CementAssociation

BAG

71%

BULK

29%

Market by Geography January 2019

,

SMGRMS 30.33%

SMGRMS 18.07%

SMGRMS 41.34%

21.12% of total

national demand

3.01% of total

national demand

SMGRMS 57.11%

8.29% of total

national demand

WEST JAVA, DKIJAKARTA BANTEN27.28% of total national demand

5.27% of total

national demand

EASTJAVA13.86% of total national demand

SMGRMS 35.90%

6.40% of total national

demand

SMGRMS 63.16%

SMGRMS 39.04%

SMGRMS 41.35%

CENTRALJAVA14.78% of total national demand 4

SMGR is still the dominant player in all regions other than West

Java & Jakarta where the competition is more intense

Sales Volume

2019 2018 Chg (%)

Domestic 2,146,463 2,289,931 -6.27%

Export 210,918 202,415 4.20%

2,357,381 2,492,346 -5.42%

TLCC

Domestic 80,000 148,573 -46.15%

Export 59,000 144,780 -59.25%

139,000 293,353 -52.62%

Total Group 2,496,381 2,785,699 -10.39%

JANUARY

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2019 2018 + (%)

JAKARTA 367,754 430,032 -14.48%

BANTEN 283,700 276,346 2.66%

WEST JAVA 885,522 841,904 5.18%

CENTRAL JAVA 712,056 788,407 -9.68%

YOGYAKARTA 121,598 86,433 40.68%

EAST JAVA 786,526 772,279 1.84%

TOTAL JAVA 3,157,156 3,195,401 -1.20%

SUMATRA 1,184,679 1,217,444 -2.69%

KALIMANTAN 362,162 350,453 3.34%

SULAWESI 462,961 483,719 -4.29%

NUSA TENGGARA 289,966 287,580 0.83%

INDONESIA TIMUR 164,980 161,152 2.38%

TOTAL INDONESIA 5,621,904 5,695,749 -1.30%

EXPORT SEMEN 72,908 70,328 3.67%

EXPORT KLINKER 174,629 168,706 3.51%

TOTAL EXPORT 247,537 239,034 3.56%

GRAND TOTAL 5,869,441 5,934,783 -1.10%

JANUARYAREA

5

Strategic Business Priority 2019

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Key Strategy 2018

Cost Transformation & Enable Corporate Growth

(Growth)StrategyRefresh

Centralize Procurement

Centralize Marketing

Supply Chain OptimizationStriving to optimize our supply chain management with“least cost to serve” principle to achieve logistic andtransportation cost efficiency.

Centralizing marketing function at holding level to eliminatedouble brand, reduce negative margin and at the endoptimize net corporate margin

Centralizing procurement function on strategic andsignificant items to leverage our bargaining power,standardizing product quality as well as guaranteeingcontinuous supply

Reducing operating expenses, Reducing cost redundancyamong cement subsidiaries, Optimizing Rembang plantutilization and maximizing synergy among subsidiaries andSoE

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Performance Overview – 9M2018

Total Production Volume

21,7 mil ton

Total production decrease by -0,7%yoy

Total Sales Volume

23,8 mil ton

Total Sales Volume increase by 5.8%yoy Combine clinker + cement

Revenue

IDR 21,45trl

Total Revenue increase by 4.4% yoy

Cement Plant Utilizations

87,0 %The Company recorded a better

utilization rate than the averagecement industry which only reached around 65%

Operating Expenses

IDR 3,00tril

Total OPEX decrease by (21.4)% yoy

COGS

IDR 627.084/ton

Total COGS / ton decrease by 2%yoy

Net Income

IDR 2,09trl

Net Income increase by 43% yoy

EBITDAMargin

21,8 %

Ebitda Margin increase by 2.6% yoy

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9 Months 2018 Revenue increase 4.4% YoY inline with the 6% increase in sales volume.

COGS grew 4.2% or lower than revenue growth related to SMGR initiatives:o Centralizing coal procurement on holding level to gain better pricing, standardized quality and 3 months fixed price.

o Rerouting distribution network to ensure margin optimization and list cost to serve.o Reducing clinker factors

o Operating Waste Heat Power Generator in Tuban Plant

Operating expenses reduced 21.4% related to our initiatives to reduce cost redundancy among cement subsidiaries as well as work based on the priority activities

Performance Overview – 9M2018

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SMGR Financial Position

Cash Balance (IDRbn) Total Interest Bearing Debt (IDRbn)

4,213

5,032

3,989

2,847

3,6654,082

2013 2014 2015 2016 2017 9M 2018

Debt/EBITDA (x)

4,083 3,913 3,999

6,260

10,019 10,288

2013 2014 2015 2016 2017 9M 2018

Net Debt/Equity

20.9%19.5%

0.5 0.5 0.5

0.9

1.91.7

2013 2014 2015 2016 2017 9M 2018

31%32%

11.2%16% 15%

20%

-0.6% -0.5% 0.0%

2013 2014 2015 2016 2017 9M 2018 2014 2015 2016 2017 9M 2018

22.1820.20

19.14

7.13 6.49

2014 2015 2016

Gross Debt/Equity

2017 9M2018

EBITDA/Interest

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Acquisition of Holcim Indonesia

Deal has attractive strategic and operational value

1

Create a dominant role in Indonesia with scale benefits along

the value chain, reinforcing SI leadership with combine market share 55%, long-term attractive

market

3

Generate significant operational synergies in centralized

procurement, logistics and maintenance.

Combined entities will be one of largest domestic coal consumer, demanding 9-10mm MT of coal

per annum.

2

Catalyze an enhanced strategy for SI, driving change and innovation in Indonesia. Leveraging the ready mix, and aggregate business with

combine volume *Rp. 4,3 million in ready mix plant

*Based on ytd 2018 (SIB 2,5 mil; HC Beton 1,8 Mil)

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Holcim Indonesia is the 3rd largest cement producer in Indonesia

o 4 integrated cement plants with total designed capacity of 14.8 mtpa in Java (3 locations) and Aceh (1 location), a mothballed grinding station at Ciwandan (0.7 mtpa) and terminals in Sumatera and Kalimantan.

o Holcim Indonesia also owns a leading RMX business and an aggregates quarry operation in Indonesia

o SMGR will acquire 80.6% shares of Holcim Indonesia at USD 917 million (subject to certain closing conditions) and followed by Mandatory Tender Offer

o Implied equity value (100%) of US$1,137 million.o The implied EV/Capacity of USD115-210/ton, which is below :

o the estimated greenfield investment cost for new plants in Indonesia of USD150-180/ ton.

o Lafarge Holcim divestments in the Asia of USD130-177/ton.o The completion of acquisition is subject to the fulfilment of certain

conditions and regulatory approval.

o The transaction will be financed through syndicated bank loan up to USD 1,282 million to cover up to 100% Holcim Indonesia shares.

Acquisition of Holcim Indonesia

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Experienced Board of Management

PRESIDENT DIRECTOR

HENDI PRIO SANTOSO, Born in Jakarta, February 5,

1967. Graduated from Bachelor of Business

Administration, University of Houston, Texas, USA,

Economics, The University of Texas.

Career History:

• Director of Investment Banking of PT JP Morgan

Securities Indonesia (2004-2007)

• Director of Finance, PT PGN (Persero) Tbk (2007-

2008)

• President Director of PT Perusahaan Gas Negara

(Persero) Tbk (2008-2017)

DIRECTOR OF MARKETING AND CHAIN

SUPPLY

ADI MUNANDIR, Born in Sukabumi on July 10, 1981,

graduated with Bachelor of Engineering and Master

of Management degree from Universitas Indonesia.

Career History:

• President Commissioner of PT Solusi Energy

Nusantara

• Commissioner of PT Nusantara Regas

• Executive Officer – Strategic Management Office PT

PGN (2013-2015)

• Head of Strategic Management Division of PT PGN

Tbk. (2015-2016)

• Head of Marketing Group of PT PGN Tbk. (2016-

2017)

DIRECTOR OF HR AND LEGAL

AGUNG YUNANTO, Born in Bandung, May 7, 1962.

graduated with Bachelor of Engineering from Institut

Teknologi Bandung and Master of Management

degree from IMI & Monash University

Career History:

• President Commissioner of PT Jasa Marga Surabaya

in 2013-2017

• General Manager of Human Capital PT Wijaya Karya

Beton period 2014-2017.

DIRECTOR OF PRODUCTION

Benny Wendry, Born in Padang, May 01, 1969.

graduated with Bachelor of Chemical Engineering from

Institut Teknologi Bandung and a Master of

Management degree from Universitas Gadjah Mada.

CareerHistory:

• Commercial Director of PT Semen Padang (2011-

2014)

• Finance Director of PT Semen Padang (2014)

• President Director of PT Semen Padang (2014-2017)

DIRECTOR OF FINANCE

Doddy Sulasmono Diniawan, Born on. February 27,

1967. Graduated with Bachelor’s Degree in

Management from Universitas Katolik Parahyangan,

Bandung and Master's degre of Financial

Managementfrom Universitas Padjadjaran, Bandung.

CareerHistory:

• Executive Vice President – Division Head of Corporate

Business Risk of PT BNI (Persero) Tbk.(2015-2016).

• Executive Vice President – CEO Jakarta Kota Region

Office PT BNI (Persero) Tbk.(2016)

• Director of Finance And Human ResourcesPT

Rekayasa Industri (2016-2017)

• Director of Business Strategy and Business

Development of PT Semen Indonesia (Persero) Tbk.

(2017-2018)

DIRECTOR OF ENGINEERING AND PROJECT

Tri Abdisatrijo, Born in Situbondo, September 05, 1967.

graduated with Bachelor of Chemical Engineering from

Institut Teknologi Sepuluh Nopember, Surabaya, .

Career History:

• GM of Project Specialist OOTC of PT Semen Indonesia

(Persero) Tbk (2013-2014)

• GM of Energy, Materials and Environment PTSemen

Indonesia (Persero) Tbk (2014)

• Commercial Director of PT Semen Tonasa (2014-2017)

DIRECTOR OF STRATEGIC BUSINESS AND

ENTERPRISE DEVELOPMENT

Fadjar Judisiawan, Born in Surabaya, May 09, 1971.

graduated with Bachelor of Engineering from Institut

Teknologi Sepuluh Nopember, Surabaya, and a

Master of Management degree from Universitas

Gadjah Mada.

Career History:

• Assistant Deputy for Construction Services of the

Ministry of SOEs (2014-2015)

• Assistant Deputy of Construction Business,

Transportation Facilities and Infrastructure IMinistry

of SOE (2015-2017)

• Deputy of Construction Business, Transportation

Facilities and Infrastructure of the Ministryof SOE

(2017)

• Finance Director of PT Semen Indonesia (Persero)

Tbk. (2017-2018).

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Thank You

IMPORTANT NOTICE

THIS PRESENTATION IS NOT AND DOES NOT CONSTITUTE OR FORM PART OF, AND IS NOT MADE IN CONNECTION WITH, ANY OFFER FOR SALE OR SUBSCRIPTION OF ORSOLICITATION, RECOMMENDATION OR INVITATION OF ANY OFFER TO BUY OR SUBSCRIBE FOR ANY SECURITIES NOR SHALL IT OR ANY PART OF IT FORM THE BASIS OFOR BE RELIED ON IN CONNECTION WITH ANY CONTRACT, COMMITMENT OR INVESTMENT DECISION WHATSOEVER.

THE SLIDES USED IN THIS PRESENTATION ARE STRICTLY CONFIDENTIAL AND HAVE BEEN PREPARED AS A SUPPORT FOR ORAL DISCUSSIONS ONLY. THE INFORMATIONCONTAINED IN THIS PRESENTATION IS BEING PRESENTED TO YOU SOLELY FOR YOUR INFORMATION AND MAY NOT BE REPRODUCED OR REDISTRIBUTED TO ANY OTHERPERSON, IN WHOLE OR IN PART.

This presentation includes forward-looking statements, which are based on current expectations and forecast about future events. Such statements involve known / unknown risks uncertainties and other factors, which could cause actual results to differ materially from historical results or those anticipated. Such factors include, among others:

● economic, social and political conditions in Indonesia, and the impact such conditions have on construction and infrastructure spending in Indonesia;

● the effects of competition;

● the effects of changes in laws, regulations, taxation or accounting standards or practices;

● acquisitions, divestitures and various business opportunities that we may pursue;

● changes or volatility in inflation, interest rates and foreign exchange rates;

● accidents, natural disasters or outbreaks of infectious diseases, such as avian influenza, in our markets;

● labor unrest or other similar situations; and

● the outcome of pending or threatened litigation.

We can give no assurance that our expectations will be attained.

DISCLAIMER

The information contained in this report has been taken from sources which we deem reliable. However, none of PT Semen Indonesia (Persero) Tbk and/or its affiliated companies and/or their respective employees and/or agents make any representation or warranty (express or implied) or accepts any responsibility or liability as to, or in relation to, the accuracy or completeness of the information and opinions contained in this report or as to any information contained in this report or any other such information or opinions remaining unchanged after the issue thereof.

We expressly disclaim any responsibility or liability (express or implied) of PT Semen Indonesia (Persero) Tbk, its affiliated companies and their respective employees and agents whatsoever and howsoever arising (including, without limitation for any claim, proceedings, action, suits, losses, expenses, damages or costs) which may be brought against or suffered by any person as a result of acting in reliance upon the whole or any part of the contents of this report and neither PT Semen Indonesia (Persero) Tbk, its affiliated companies or their respective employees or agents accepts liability for any errors, omission or mis-statements, negligent or otherwise, in the report and any liability in respect of the report or any inaccuracy therein or omission therefrom which might otherwise arise is hereby expresses disclaimed.

HeadOffice:

Gedung Utama Semen Indonesia Jalan Veteran, Gresik 61122, East Java – Indonesia

Phone: (62-31) 3981731 -2, 3981745

Representative Office:

The East Tower, 18th floorJalan Dr. Ide Anak Agung Gde Agung Kav. E3.2 No. 1 Jakarta 12950, Indonesia

Fax: (62-31) 3983209, 3972264 Telp.: (62-21) – 5261174, 5261175;Fax : (62-21) – 5261176

www.semenindonesia.com