KIJA Investor Presentation - June 2016

PT Jababeka Tbk
Investor Presentation
June 2016
Leading township developer & infrastructure powerhouse
PT Jababeka Tbk ("KIJA") is a leading township developer with an established track record in industry-based townships
supported by residential & commercial components...
Jababeka ("KIJA") overview
Business segments
FY15 Revenue Breakdown (%)
(Rp 3,140 billion)
PT Jababeka Tbk
Real Estate




Infrastructure
& Port, 12%
Infrastructure
Industrial
Power
Residential
Infrastructure
Commercial
Dry Port
Established in 1989 and became the first publicly listed industrial
estate developer in Indonesia in 1994
Kota Jababeka, KIJA's flagship development, is a mature industrybased integrated township in Cikarang with on-site power plant
and dry port
Pipeline projects: Kendal Industrial Park in Central Java and
tourism-based township in Tanjung Lesung, Banten
Large and strategically located land bank of 3,277 hectares as of 31
March 2016
Vision: To Create Modern Self Sustained Cities in Every
Province in Indonesia and Provide Jobs for Better Life
Real Estate &
Others, 41%
Power
Plant, 48%
FY15 Gross Profit Breakdown (%)
(Rp 1,389 billion – 44% GPM)
Infrastructure
& Port, 12%
Power
Plant, 15%
Real Estate &
Others, 72%
…with world class infrastructure to support its developments
1
Established track record in large-scale industrial estate + infrastructure
More than 25 years track record in industrial township development
Selected awards
#1
#1
#1
Ministry of Industry - 2015
Best Industrial Estate –
Infrastructure & Facilities
Indonesia Property Watch2015
The best township
development concept
Investor Magazine - 2012
Top 10 Best performing
listed companies and Best
listed company in property
Fortune Indonesia - 2015
Best Company award
2014
2013
2012
#1
2011
Frontier Consulting Group Award
2014 #1 Corporate Image
Industrial Estate
Supply Chain Asia Awards 2014
Asia Logistics Centre/Park of the
Year
2010
2003
2001
1996
1994
1989
Jababeka Group
established and
started
development of
the industrial
estate
IPO on
Jakarta and
Surabaya
Stock
Exchange
Acquisition of
Menara Batavia
in Jakarta CBD
Inauguration of
Education Park,
including President
University
Commenced
development of
Jababeka CBD
Cikarang Dry
Port begins
operations
Acquisition
of 1,500 ha
land in
Tajung
Lesung,
Banten
D’Khayangan
Senior Living
Launched
Bekasi
Power Plant
commenced
operations
Entered into a JV
with Sembcorp
to develop
Kendal Industrial
Park in Central
Java
2
Sizeable land bank in strategic locations with upside potential
Kota Jababeka Cikarang
Master plan: 5,600 hectares
35km east of Jakarta
Land Bank: 1,233ha(1)
Karawang
Tanjung Lesung
Master plan: 1,545 hectares
170km southwest of Jakarta
Land Bank: 1,544ha(1)
Kendal, Central Java
Master plan: 2,700 hectares
450km east of Jakarta
Land Bank: 472ha(1)
Note:
1
Land bank as at 31 March 2016
3
Key credit strengths
1
Leading industry-based integrated township developer in Indonesia
2
The ONLY industrial developer with on-site power and dry port
3
Stable, USD-denominated recurring income from infrastructure operations
4
Diversified land bank and projects
5
Clear strategic focus over different time frames
6
Robust operating and financial performance
7
Experienced management team
8
Beneficiary of favourable macro and sector fundamentals
4
1
Kota Jababeka — Flagship industry-based integrated township
Kota Jababeka is a mature industry-based township strategically located in close proximity to Jakarta CBD, sea port and
airport…
Toll Road
Future Toll Road
Tajung
Priok Port
SoekarnoHatta
International
Airport
Heavy industries
& Petrochemicals
DKI
JAKARTA
Tangerang
Bekasi
(in km)
Distance from
Kota Jababeka
Jakarta CBD
35
Seaport
55
Airport
65
South
Tangerang
Automotive, Consumer,
Electronics & other Light
to medium industries
Kota Jababeka
1
Strategically located in Cikarang area, the most established industrial estate zone in Greater Jakarta
2
Close to central Jakarta, sea-port, airport and accessible by both toll and railroads
3
Mature township with a well-established talent/labor pool supported by complementary facilities (residential, commercial, hospitality, etc)
4
Superior infrastructure facilities which serve to enhance Kota Jababeka's competitive positioning for customers
…and is home to over 1,600 local and multinational customers from over 20 countries
5
1
Kota Jababeka – Anchored by a blue-chip customer base
The portfolio of high quality multinational and domestic customers at Kota Jababeka is a testament to the township's
strategic location and superior infrastructure facilities
Diverse mix of occupants across sectors
(breakdown by number of occupants) – As of 31 March 2016
Portfolio of high quality customers
Electronics
12%
Consumer
Goods
7%
Machinery
7%
Others
44%
Chemicals
6%
Automotive
6%
Textile
2% Building
3%
Metal
Fabrication
4%
Food
5%
Plastics
5%
6
1
Kota Jababeka – Continued build-out of complementary facilities
Kota Jababeka has successfully achieved a critical mass of occupants which provides an opportunity to continue introducing
complementary services and infrastructure to enhance the township's value proposition
Residential
Housing clusters
The Veranda
D’Java
Residence
Commercial
High-rise residence
Tropikana
Garden
Simprug
Garden
Elvis Tower
Sentra Niaga
Square
Senior housing
Senior Living @
D’Khayangan
Simprug Plaza
Mixed-use superblock developments within Kota Jababeka
Partnered with Plaza Indonesia to develop “MAYFAIR Estate & Park Land”
70%
Phase 1
Phase 2
30%


30%
Mixed use superblock on a 12-ha site
Groundbreaking happened in June
2015; first stage of Phase 1 targeted
completion in 2018

70%
Phase 2 to be
developed on a
4-ha site
7
2
Enhancing Kota Jababeka's value proposition: Bekasi Power Plant
Jababeka is the only industrial estate developer in Indonesia with its own power plant located within its estate
Integrated Power Generation & Distribution Process
1
2
3
100% output to PLN
Buy back from PLN
(+16% margin)
PLN

130MW gas fired combined cycle plant

20 year 100% off-take agreement from Perusahaan Listrik Negara
(“PLN”)
–
–
–
–
–
Direct sale to factories
(+ margin)
Rate per KWH: ~US$11 cents
Average gas cost / MMBTU: ~US$10.0
Fuel costs borne by PLN on a pass-through basis
Fully contracted gas supply
Flexibility to buy back power and resell it at a premium
Factories
Improving efficiency, has led to higher margins
IDR billion
1,600
1,400
1,200
1,000
800
600
400
200
-
Key highlights of operations at Bekasi Power Plant
1,499
1,267
1,062
14.3%
15.1%
12.2%
7.7%
369
82
2013
Revenue
155
215
56
16.0%
14.0%
12.0%
10.0%
8.0%
6.0%
4.0%
2.0%
0.0%
Description
2014
2015
Net Dependable Capacity
118.8MW
120MW
Load Factor
108MW
110MW
Capacity factor
90.01%
90.01%
Equivalent Availability Factor
90.34%
96.39%
Planned Outage Factor
7.88%
3.09%
Equivalent Forced Outage Rate
1.78%
0.52%
2014
2015
1Q16
Gross Profit
Gross Profit Margin
Providing a significant marketing advantage over its competitors as access to reliable electricity supply is one of the primary
concerns for industrial clients in Indonesia
8
2
Enhancing Kota Jababeka's value proposition: Cikarang Dry Port
Strategic location in the heart of the largest manufacturing zone along the Bekasi-Cikampek industrial corridor
JABABEKA
MM 2100
EJIP
62%1
LIPPO
HYUNDAI
SURYA CIPTA
GIIC
KIIC
KIKC
KIM
KBI
International Port Code: IDJBK
Surrounded by 11 Industrial Estates and
more than 3,000 manufacturing companies
Notes:
1 Estimated % of total throughput at Tanjung Priok Port originating from this area
9
2
Enhancing Kota Jababeka's value proposition: Cikarang Dry Port
Facilities & services offered at Cikarang Dry Port
Container Yard
Reefer Services
Terminal
Operation 24/7
Container
Freight Station
Bonded Trucking
Rail Freight Service
Logistics Park
• Warehouses
• TPP
Bonded Logistics Center 2
(Under Construction)
Empty Depot
24/7 Security
Gate
Bonded Logistics Center
Office:
CDP, Customs,
Quarantine
CFS
Railway:
• Domestic
• International
CY
Physical Check
Reefer
CY Expansion Plan
Port (70 Ha):
• Customs
• Quarantine
• Physical Check
• Container Yard
• Reefer Plugs
• CFS
Emplacement
Expansion Plan
General
Warehouse
Special Containers
Handling
10
Integrated Customs & Quarantine
Empty Container Depot
Online Tracking & INSW Connected
2
Enhancing Kota Jababeka's value proposition: Cikarang Dry Port
Cikarang Dry Port (CDP) is the first and only integrated customs and service estate in Indonesia…
Overview




In April 2011, CDP became an official port of origin and
destination with an international port code, IDJBK
Adjacent to the main railway line that runs from west Java to
east Java for domestic distribution
Upside potential from direct rail connection to Tanjung Priok
port – Trial already took place in 1Q16.
Bonded Logistics Centre for Cotton – result from the 2nd
Economic Stimulus Package by the government
Selected customer & partner profile at Cikarang Dry Port
Strong momentum in CDP operations
Revenue (IDR billion)
140
120
120
100
78
80
62
60
34
40
20
9
15
2011
2012
2013
2014
2015
1Q16
Throughput (TEU)
60,000
50,844
50,000
37,507
40,000
30,000
25,808
20,000
10,000
14,283
3,334
5,995
2011
2012
2013
2014
2015
1Q16
…allowing customers to more efficiently manage their imports and exports and benefit from cost savings
11
3
Sizeable and stable USD-denominated recurring income base
The provision of these infrastructure services has enabled the progressive build out of a significant recurring revenue base…
Recurring revenue & EBITDA (IDR billion)
Total Revenue & Breakdown
2,000
2015
1,800
Recurring(1)
41%
Real Estate(2)
59%
1,200
57%
IDR 3,139 billion
800
600
2013
IDR 2,799 billion
49%
200
IDR 2,740 billion
17%
IDR 1,401 billion
468
400
0
83%
1,349
1,400
1,000
43%
2012
1,592
1,600
2014
51%
1,868
183
240
40
64
2011
2012
210
2013
Recurring EBITDA
349
418
128
2014
2015
1Q16
Recurring Revenue
…based on USD pricing terms (power & water), further enhancing stability and visibility
of cash flows for Jababeka and also providing a natural hedge for its USD-denominated
interest expenses
Furthermore, US$ 200 million notional is hedged by means of call spreads with an average lower
strike at 13,014 Rupiah and an average upper strike of 14,964.
Notes:
1 Recurring revenue/EBITDA includes contribution from power plant, dry port and service & maintenance fees
2 Comprises real estate, golf and other non-infrastructure segments
12
4
Diversified land bank
A geographically diversified land bank allows KIJA to capture different market segments and enhances earnings resilience…
Land bank breakdown by location (in hectares)
Township
Location
Acquired land bank (March 31, 2016)
Kota Jababeka
Cikarang
1,233
Kendal Industrial Park
Central Java
472
Tanjung Lesung
Banten
1,544
Total
3,248
Kota Jababeka
Established MNCs and domestic companies willing to pay a premium for strategic location and mature
township with top notch infrastructure in place
Kendal Industrial Park
More cost-conscious customers looking for an alternative to Greater Jakarta industrial estates that still
provides top notch infrastructure
Tanjung Lesung
Tourism, leisure and hospitality focused integrated township to tap into entertainment/leisure spending by
rising middle class in Indonesia
…in addition to benefiting from future infrastructure developments across its land bank locations
13
4
Diversified projects: Kendal Industrial Park
Kendal Industrial Park benefits from Sembcorp's expertise in developing and marketing industrial zones across Asia
(China, Vietnam, Batam, Bintan, etc)…
Kendal Industrial Park is a JV between KIJA and Sembcorp
Excellent connectivity to major infrastructure in Central Java
Kendal Port
49%
Tanjung Emas
Seaport
51%
Ahmad Yani
Int'l Airport
Semarang
Total planned area: up to 2,700 ha
Phase 1: 860 ha (472 ha acquired as of 31 March, 2016)
Distance to Kendal Industrial Park
Tanjung Emas Int'l Seaport
25 km
Ahmad Yani Int'l Airport
20 km
Semarang (provincial capital)
21 km
…and complemented by KIJA's long track record and
experience in Indonesian industrial estate developments and infrastructure operations
14
4
Diversified projects: Kendal Industrial Park
Our Kendal Industrial Park development in Central Java is well-positioned to benefit from growing demand for relatively low
cost industrial estates with good connectivity and competitive labor costs
Affordable land prices
relative to Greater Jakarta
industrial estates
Average industrial land
prices (USD/sqm)
Why Central Java?
300
224
200
185
174
Karawang
Bogor
Avg. Greater JKT industrial
land price: US$175/sqm
159
133
100
0
Bekasi
Tangerang
Serang
Relative low wages
Monthly minimum wage
(IDR m)
Source: Colliers Indonesia Research 4Q 2014, converted using 1USD =12,245 IDR
3.0
2.0
2.4
2.7
2.8
Surabaya
Bekasi
1.7
1.0
0.0
Semarang
Serang
Source: Colliers Indonesia Research 4Q 2014
Less congested
infrastructure

Kendal Industrial Park is situated along the Jakarta-Semarang-Surabaya Economic Corridor

Increasing traffic congestion at Tanjung Priok Port in Jakarta has led to growing interest in alternative
sites with good connectivity via air and sea

Kendal Industrial Park's location provides access to Tanjung Emas Port in Semarang (25km away), the
3rd largest deep sea port in Indonesia after Tanjung Priok (Jakarta) and Tanjung Perak (Surabaya)

Ahmad Yani International Airport at Semarang is also only 20km away
15
4
Diversified projects: Kendal Industrial Park
16
4
Diversified projects: Tanjung Lesung
Tanjung Lesung overview
Location
~ 170 km southwest of Jakarta in Banten
Concept
Tourism-based integrated township
(hotels, apartments, sailing, diving & beach clubs)
Access
Currently accessible by toll road from Jakarta in
~ 3.5 hours
17
4
Diversified projects: Tanjung Lesung
Strong government support for Tanjung Lesung's development as a tourism zone, particularly in the form of building new toll
road access to the area…
Facilities and infrastructure at Tanjung Lesung
Strong government support for development of Tanjung Lesung

Existing infrastructure includes access roads, a water treatment
plant, wastewater treatment plant, electricity supply and
telecommunication links

Visitors currently have access to ~ 300 rooms spread out over
two hotels/resorts, a bed and breakfast and several cottages

Other facilities: restaurant and bar, driving range, a swimming
pool, a spa, a beach club, a sailing
club, school, mosque, residential housing units, and a medical
clinic
 Included in the Master Plan for Acceleration and Expansion of Indonesian
Economic Development (MP3EI)
 Infrastructure development pipeline which will improve access for
Tanjung Lesung:
–
New toll road from Serang Timur to Panimbang
Recent events at Tanjung Lesung
“President Joko Widodo targets the development of the Tanjung Lesung special tourism
economic area to complete in three years.…. President Widodo said he set the three
year deadline in line with construction time of the Serang-Panimbang toll road.
President Widodo said the toll road will be built by the government….
President Joko Widodo speaking on Tanjung Lesung’s
designation as Special Economic Zone for Tourism
Indonesia Finance Today
23 Feb 2015
”
…is expected to increase interest from potential investors/partners for the project
18
4
Diversified projects: Tanjung Lesung
Aerial view
Beach at Tanjung Lesung
Aerial view
Villa at Tanjung Lesung
19
5
Clear strategic focus
Jababeka's existing pipeline provides visible opportunities over different time frames

Short Term
Short-term focus will be to continue developing
Kota Jababeka Township:
–
Target fast growing, low-middle end
residential & commercial segment
–
Cater to preference for smaller land
plots, standard factory buildings
–
Maintain/further improve operational
efficiency at Bekasi Power Plant
–

Development of Kendal Industrial Park in
partnership with Sembcorp in central Java

Development of Bekasi Power Plant Phase 2 on
vacant site adjacent to existing facility
Medium Term
Increase utilization rates at Cikarang Dry Port
–

Ongoing discussions with PLN; to commence
only upon securing off-take agreement with
PLN similar to existing power plant
Development of Tanjung Lesung tourism-based
township
Long Term Vision
 Replicate Kota Jababeka's industry-based integrated township model throughout Indonesia
 Build out an infrastructure facility portfolio (power, water, ports, etc.) to support these new townships
20
6
Strong financial performance...
Revenue breakdown (IDR billion)
Gross profit (IDR billion) and Gross profit margin (%)
3,500
3,000
2,740
1,390
1,161
965
2011
1,349
1,868
240
587
400
119
468
200
2014
2015
1Q16
Real estate & other revenue
EBITDA (IDR billion) and EBITDA margin (%)
60%
53%
600
1,019
1,130
1,167
50%
44%
741
800
40%
37%
40%
400
40%
44%
31% 30%
614
20%
182
2012
2013
Gross profit
450
2014
2015
Gross profit margin
1Q16
350
200
326
331 2
300
200
22% 20%
150
0
10%
0%
2014
2015
EBITDA margin
399
380
400
1Q16
Notes:
1 FY2013 includes unrealized foreign exchange loss (non cash) of approximately IDR 421 billion
2 FY2015includes unrealized foreign exchange loss (non cash) of approximately IDR 155 billion
133
1011
100
2013
EBITDA
10%
0%
2011
30%
128
2012
45%
250
37%
509
2011
43%
50%
Net income (IDR billion)
1,400
1,000
860
60%
1,252
0
2012
2013
Recurring revenue
1,200
1,171
53%
800
1,592
1,389
61%
1,000
600
183
-
1,207
1,401
1,148
1,000
500
1,200
1,272
2,000
70%
1,400
2,799
2,500
1,500
1,600
3,140
50
0
2011
2012
2013
2014
2015
1Q16
21
6
Robust balance sheet position…
Assets and cash (IDR billion)
Debt, Equity (IDR billion) and Debt/Equity
12,000
6,000
9,741
10,000
8,255
8,000
1.00
9,829 5,000
4,662
8,505
4,000
7,078
3,975
3,502
4,186
0.61
0.58
3,510
6,000
3,000
8,914
7,660
4,000
0.43
9,072
7,911
0.70
0.60
0.50
2,046
2,000
6,836
0.67
3,457
2,705
2,572
0.40
1,497
0.30
5,470
128
242
0
0.10
595
2011
2012
2013
Cash and cash equivalents
595
827
757
0.00
2011
2012
Total debt
2013
2014
Total equity
2015
1Q16
Debt/Equity
Net debt/EBITDA (x)
3.0
4.5
4.0
3.0
0
2014
2015
1Q16
Total assets (excluding cash)
EBITDA/Interest expense (x)1
3.5
0.20
1,000
2,000
0.90
0.80
0.71
0.51
5,597
5,128
4,978
3.8
3.1
2.7
3.8
2.5
3.4
3.2
2.7
2.4
1.9
2.0
2.5
2.3
1.9
1.5
2.0
1.7
1.5
1.0
1.0
0.5
0.5
0.0
0.0
2011
2012
Notes:
1 Includes capitalized interest + Hedging Fees
2013
2014
2015
1Q16
2011
2012
2013
2014
2015
1Q16
22
7
Experienced management team
Average of more than 20 years of industrial township development experience
Board of Commissioners
Setyono Djuandi Darmono
Bacelius Ruru
President Commissioner
Vice President Commissioner Commissioner
(Founder)
Independent Commissioner (Founder)
Hadi Rahardja
Gan Michael
Ketut Budi Wijaya
Commissioner
Commissioner /
Independent Commissioner
Board of Directors
Budianto Liman
Hyanto Wihadhi
Sutedja Sidarta Darmono
Tjahjadi Rahardja
Setiawan Mardjuki
President Director
Director
Director
Director
Director
23
8
Favorable macro and sector fundamentals
Strong real GDP growth outlook (%)
Continued growth in direct investments – both FDI and domestic (IDR trn)
8.0
600
6.4
6.2
6.0
6.0
5.6
5.0
4.7
5.3
5.5
5.5
4.0
2.0
0.0
545
463
500
179
398
400
323
300
251
200
76
100
175
128
156
93
270
230
366
307
50
96
0
2010 2011 2012 2013 2014 2015 2016F 2017F 2018F
2011
2012
2013
2014
2015
FDI
Domestic Direct Investment
Source: BKPM
Sizeable domestic market size — world's 4th largest population
Greater Jakarta average industrial land prices (USD/sqm)
1,600
1,376
1,311
Source: Global Economic Prospects, World Bank (January 2016)
1,200
400
China
India
US
Indonesia
Brazil
Pakistan
Nigeria
Bangladesh
Russian
Mexico
Japan
Philippines
Ethiopia
Vietnam
Egypt
Germany
Iran
Turkey
Congo
Thailand
UK
France
Italy
S.Africa
Myanmar
Tanzania
Korea
Colombia
Spain
Kenya
0
Source: United Nations Department of Economic and Social Affairs - Population Division, as of July 2015
174
Q1 2016
169
174
2008 2009 2010 2011 2012 2013 2014 2015
Q1
2016
159
160
114
120
322
258
208
189
182
161
143
127
127
101
99
93
92
81
79
79
77
68
65
64
60
54
54
53
50
48
46
46
800
200
147
118
81
80
56
62
40
0
Source: Colliers Indonesia International research
24
Thank You
www.jababeka.com