Embracing a New Era of Transformation

Natural Empowerment
Embracing
a New Era
of Transformation
PT Barito Pacific Tbk
Wisma Barito Pacific Tower B, 8th floor
JL. Let Jend S. Parman Kav 62-63
Jakarta 11410, Indonesia
Tel +62 21 530 6711
Fax +62 21 530 6681
www.barito-pacific.com
www.barito-pacific.com
Barito Pacific is changing,
both internally and
externally, grounded upon
the transformational efforts
of the Company with the
aim of securing sustainable
long-term growth.
In all lines of business,
Barito Pacific places high
respect to natural resources
by continuously caring
about our environment,
and espousing sustainable
production.
A new spirit is brewing at Barito Pacific, among our dedicated men and
women; a spirit that will allow the Company to embrace a new era, pursue
more dynamic growth opportunities, and become a fully energized, diversified
resource-based enterprise. We believe that Barito Pacific’s new direction
provides us with the strategic platform to achieve sustainable development
and growth over the long term.
Table of contents
Embracing a New Era of Transformation 01_Barito Pacific in Brief 03_Our Subsidiary Companies 04_Timber 06
Petrochemicals PT Chandra Asri 09_PT Styrindo Mono Indonesia 11_PT Tri Polyta Indonesia Tbk 13
Properties PT Griya Idola 14_Our Core Asset 15_Working with Society 16
B a r i to Pa ci f i c Natu ra l Em p owe r m e nt _ 0 1
There comes a time for every company
to turn a new page in its history
and embark upon a new journey
that leads to brighter future...
Our conduct of business
A broarder view of the future
Performing with guarded confidence
We achieve constant improvements by
continuously evolving. A key decision in
our on-going transformation was the
change of name, identity and colors of
PT Barito Pacific Timber Tbk to those of
PT Barito Pacific Tbk. We have decided to
drop the word “Timber” to reflect
the diversified scope of our businesses
today and increasingly in the future.
The Company is enhancing its
experience to the implementation
of good corporate governance
practices in its operational business.
Through the sound implementation of
GCG practices, the Company ensures that
the transformation process towards a
diversified company in the energy
resource base is being on the right track.
The Company has developed a
comprehensive risk management
framework as an integral part of its
business. Evaluative and anticipative
measures at the earliest stage of a
potential risk are the cornerstones of
the Company’s rigorous risk
management process.
Barito Pacific is moving quickly
to establish footholds in industries
that are evergreen, resource-based
oriented, and with significant downstream
growth opportunities. We are now engaged
in the forestry, petrochemicals and property
industry sectors, and have ultimately
evolved into a fully diversified resourcebased enterprise.
The GCG practices represent the Company’s
commitment that underlines transparency,
accountability, responsibility, fairness and
independence in its business operation.
With the implementation of GCG, it is
expected that integrity will always be kept
within the Company’s network to maintain
the value of our stakeholders.
The major risk categories of importance
to the Company are strategic,
operational and finance. The indicators
and parameters of all risk elements
attributable to the risk categories have
been and continue to be systematically
identified and analyzed in a timely
manner. The identified risk elements are
then closely and constantly monitored
at all levels of management. This highly
organized and bottom-up approach to
risk management provides reasonable
assurances towards the business
continuity and sustainability
of the Company.
Our immediate next step will be to build
our plantation portfolio. This initiative
will include planting for new oil-palm
estates, as well as regenerating sustainable
timber estates to support our wood-based
industries.
Moreover, we always ensure the
implementation of corporate social
responsibility as part of good corporate
governance. We instill in our governance
policy the need for the Barito group
of companies to be socially and
environmentally responsible for all
of our business undertakings.
We believe that Barito Pacific’s new
direction provides us with the strategic
platform to achieve sustainable
development and growth over
the long term.
Years of thorough planning and preparation have led us to
a brilliant transformation into a fully diversified resourcebased enterprise.
1979 Established in
South Kalimantan;
an Indonesianbased integrated
wood company.
1993 Listed its shares
in Jakarta and
Surabaya Stock
Exchange.
0 2 _ Bar ito Pacific Natural Em p ower m ent
B a r i to Pa ci f i c Natu ra l Em p owe r m e nt _ 0 3
2007 Changed name to
PT Barito Pacific Tbk.
2007 Completed the
acquisition of
PT Chandra Asri
and its subsidiary
(PT Styrindo Mono
Indonesia).
2008 Completed the
acquisition of
PT Tri Polyta Tbk.
Our Subsidiary Companies
01
PT Tunggal Agathis Indah
Wood Industries
Plywood &Blackboard
Being perceptive with the current climate of
national timber industry, we have pursued
a strategy of downsizing our timber-based
operations, whilst diversifying our business
into other resource-based industries.
The acquisition of Chandra Asri was a significant mark
for Barito Pacific as we embark on our new beginning,
following our decade-long restructuring
and regeneration.
PT Tunggal Agathis Indah Wood Industries
(“TAIWI”) was established in 1980,
currently engaged in the production
and exports of plywood and blockboard
products.
02
PT Kirana Cakrawala
Industrial Forest Plantation
PT Kirana Cakrawala (“KC”) was
established in 1992 to engage in the
management of an Industrial Timber
Estate that encompasses the activities
of seedling, nursing, planting, cultivating
and harvesting of logs and timber for
the manufacturing and marketing of
wood-based products by itself and other
wood-based manufacturing and marketing
companies within the Barito Pacific c
Group. KC is 60% owned by TAIWI and 40%
by the state-owned forestry company, PT
Inhutani II.
03
PT Mangole Timber Producer
Plywood &Blockboard & Particle Board
PT Mangole Timber Producer (“MTP”) was
established in 1970. MTP manufactures
and exports mainly plywood, blockboards
and particleboards, MTP is 99.99% owned
by the Company.
04
07
PT Kalpika Wanatama (“KW”) was
established in 1992 to engage in the
development of timber industrial estates
as well as in related activities that enhance
the productivity of the estates as well as to
preserve the natural environment within
and surrounding those estates. KW is 60%
owned by MTP and 40% owned by the
state-owned forestry company,
PT Inhutani II.
Acquired by CA in April 2007, PT Styrindo
Mono Indonesia (“SMI”) is the only local
producer of styrene monomer, mostly sold
to domestic market with a total market
share of 80%. SMI exported its remaining
products to China and other Southeast
Asian countries. SMI’s production facility is
located in Bojonegara, Banten. Occupying
more than 141,400m2 of land, the factory
is strategically located between Port of
Merak and one other international port,
which is being built by PT Pelindo II. SMI’s
annual production capacity is 340,000
tones.
PT Kalpika Wanatama
Industrial Forest Plantation
05
PT Griya Idola
Property
PT Griya Idola (“GI”) was established in
1989, originally under the name of PT
Griya Idola Real Estate. The company
was formed to undertake real estate
development primarily related to the
activities of the Company. It is now the
owner and operator of the Barito Pacific
Twin Towers office complex in Jakarta. GI,
which is 99.99% owned by the company
also has a landbank totaling 179,240 sqm
in a prime district of Jakarta.
06
PT Chandra Asri
Petrochemical
Founded in 1991, Chandra Asri (“CA”)
is the leading petrochemicals producer
in Indonesia. Since 2005 the overall
utilization rate has reached 100%. It
has a dominant market position with
over 50% share of the olefins ns market,
with strong local customer base. The
nameplate production capacities of CA are
Ethylene 520KTPA, Propylene 280KTPA and
Polyethylene 300KTPA.
CA’s petrochemical complex comprises of
an integrated ethylene cracker and twopolyethylene production trains. CA is the
only ethylene cracker & py-gas producer
in Indonesia, one of the two producers
of propylene and a leading producer of
polyethylene.
B a r i to Pa ci f i c Natu ra l Em p owe r m e nt _ 0 5
PT Styrindo Mono Indonesia
Petrochemical
08
PT Tri Polyta Indonesia Tbk
Petrochemical
Established in 1988, PT Tri Polyta
Indonesia Tbk (“TPIA”) is the largest
Indonesian manufacturer of polypropylene
resins in Indonesia. TPIA started its
commercial operations in 1992 with two
production trains with a combined annual
capacity of 160,00 metric tons. Today
TPIA has three production trains located
in the petrochemical complex in Cilegon,
Banten with a combined annual capacity
to produce between 360,000 to 380,000
metric tons of polypropylene, depending
on the production mix.
TPIA received its ISO 9002 certification,
in 1996, ISO 14001 certification in 2000,
and subsequently ISO 9001 certification in
2002.
09
Marigold Resources Pte. Ltd
Holding Company
Marigold Resources Pte. Ltd. (“MR”) is
located in Singapore. 100% MR’s shares is
owned by Barito Pacific.
PT Tunggal Agathis Indah Wood Industries (“TAIWI”) and
PT Mangole Timber Producers (“MTP”)
Timber
Barito Pacific
holds sizeable
forestry
concessions
and wood
manufacturing
plants that
conform to
international
ecological
safe practice
standards that
are recognized
by major wood
product buyers
and consumers
around the
world.
Our presence in the timber and
woodworking industries since 1983 has
made Barito Pacific a widely recognised and
reputable name in the forestry sector in
Indonesia.
Our reputation for sustainable forest
exploitation and regeneration of
Indonesia’s vast timber resources is
second to none. Barito Pacific is one of
the pioneers of sustainable HTI - Hutan
Tanaman Industri - the Indonesian
term for industrial forest estate, the
sustainable practice of forestry whereby
plots of land of industrial timber are
planted, harvested, replanted and
harvested on a never-ending cyclical
and rotational basis of several years
depending on the maturity period of
the planted trees.
With the first truly sustainable
industrial timber estate operations in
Indonesia at the time, Barito Pacific
quickly built a reputation for being one
of the early environmentally focused
wood-based company to emerge from
Asia.
B a r i to Pa ci f i c Natu ra l Em p owe r m e nt _ 0 7
With that in mind, our timber industrial
estate and its integrated downstream
wood-processing mills will be part
of Barito Pacific’s Plantation Group
portfolio. We will leverage our
more than 25 years of experience
in sustainable forestry development
and management to benefit future
development of oil palm and jatropha
plantations primarily in Indonesia.
Overview
L a u t H al m ah e r a
The company produces timber products with its 2
subsidiaries, PT Tunggal Agathis Indah Wood Industries
(“TAIWI”) and PT Mangole Timber Producers (“MTP”)
• Holding 445, 296 ha of forest
concessions rights (HPH) and
over 110,321 ha concession
for industrial forest (HPHTI)
in various regions in
Indonesia.
Our presence in the timber and
woodworking industries since 1983 has
made Barito Pacific a widely renowned
and reputable name in the forestry
sector in Indonesia.
Barito Pacific owns a vast grouping
of industrial timber estates, with
integrated woodworking and processing
facilities. The range of our products also
extended from basic plywood to block
boards and particleboards. While our
markets ranged broadly from Asia to
the Middle East, Europe and America.
On the point of nurture, a key strategy
of Barito Pacific, as we strive constantly
to enhance our long-term sustainability,
is to develop a HTI portfolio that will be
one of the Group’s primary businesses
as a fully diversified resource-based
enterprise.
• Operates 3 mills, 1 mill in
South Kalimantan (particle
board product) and 2 mills in
Maluku Utara (plywood and
block board products.
P. H A L M A H ER A
Laut MALUKU
PT TAIWI 1
PT TAIWI 2
P. TA L I A B U
PT MTP 3
L a u t S ER A M
P. S ER A M
PT MTP 5
PT MTP 2
LAUT BANDA
PT Chandra Asri (“CA”)
Being perceptive with the current climate of
Petrochemicals
national timber industry, we have pursued
a strategy of downsizing our timber-based
operations, whilst diversifying our business
into other resource-based industries.
Being
perceptive with
the current
climate of
national timber
industry, we
have pursued
a strategy of
downsizing our
timber-based
operations,
whilst
diversifying
our business
into other
resource-based
industries.
Founded in 1991, CA is the leading
petrochemicals producer in Indonesia.
Our petrochemical complex comprises
of an integrated ethylene cracker and 2
polyethylene production trains.
Today, petro-derived chemical
substances that are produced in giant
petrochemical complexes - such as
CA’s - will invariably find their way to
virtually every household product,
every industrial insulation, and every
manufacturing part that we can think of.
CA is the first and only Olefin
manufacturer in Indonesia. Olefin is the
first-tier derivative of Naphtha, which in
turn is derived from crude oil.
From Naphtha, the hydrocarbon
component of this highly flammable
liquid is “cracked” to produce raw
material for petrol and Olefin - the basic
building block for all manufactured
plastics, home sidings, synthetic
fibers, resins, films, adhesives, coating
materials, insulators, paints, dyestuffs,
foams, detergents, automotive and
electronic components, tire cords, the
list is endless.
Overview
• It has dominant market
position with over than 50%
of the olefin markets, with
strong local customer base.
• Production capacities
of CA are Ethylene 520
KTPA, Propylene 280 KTPA,
Polyethylene 300 KTPA.
SMI
N
Merak
Cilegon
Tri Polyta
Indonesia
Chandra Asri
Anyer
B a r i to Pa ci f i c Natu ra l Em p owe r m e nt _ 0 1
B a r i to Pa ci f i c Natu ra l Em p owe r m e nt _ 0 9
CA’s petrochemical complex, one of
the largest in Southeast Asia, was built
and commissioned at a time when
Indonesia was one of the roaring tiger
economies of Asia. The vision was that,
on aggregate, both Indonesia and its
manufacturing industries would benefit
from locally manufactured olefins. Barito
Pacific regards its acquisition of CA as a
move of immensely strategic value. Not
only does it provide us with a strong
revenue base, going forward; but
• CA’s petrochemical complex
comprises of an integrated
ethylene cracker and 2
polyethylene production trains.
•The only ethylene cracker
& py-gas producer in
Indonesia.
•One of the two producers
of propylene and a
leading producer of
polyethylene.
PT Styrindo Mono Indonesia (“SMI”)
Petrochemicals
Barito Pacific’s downstream expansion
from its Olefin-based petrochemicals
platform has begun in earnest. In April
2007, Chandra Asri acquired 99.97%
ownership stake in PT Styrindo Mono
Indonesia (SMI), the only manufacturer
of styrene monomer in the country
today, with a total share of the
domestic market of approximately 80%,
and key growing export markets to
China and within Southeast Asia.
Located not far from where the Chandra
Asri Plant is situated, SMI is a strong
niche player in Indonesia’s relatively
young petrochemicals industry. SMI
manufactures styrene monomers that
are used in the production of plastic
disposable cups usually found in water
dispenser, plastic food containers,
and high impact plastics used for toys,
household utensils and many more.
To produce styrene monomers,
SMI uses ethylene as the main raw
materials. In 2007, SMI increased its
ethylene consumption from Chandra
Asri from 17% to 60%. CA fully supports
SMI’s production capacity of 340,000
tones of styrene monomers per annum
with high quality ethylene.
Our production facilities comprise
of a 100 KTPA plant using the Badger
& ABB Lumus Technology, and 200 KTPA
plant using the integrated EB/SM ABB
Lumus Technology. With improvement
and optimization, the Complex can now
produce 350 KTPA. SMI also owns a
stake in the Jetty and storage company
Redco, and utilize its world class
facilities to import and export products.
Overview
The only manufacturer of styrene
monomer in the country today, with a
total share of the domestic market of
approximately 80%, and key growing
export markets to China and within
Southeast Asia.
• In 2006, the Ministry of Trade
estimated a total consumption of
styrene monomer in Indonesia of
close to 302,000 ton.
• Average domestic consumption
growth is 6% per annum.
B a r i to Pa ci f i c Natu ra l Em p owe r m e nt _ 1 1
• SMI is the only styrene monomer’s
producer in Indonesia with 80%
domestic market .
• SMI also exports its styrene
monomer to South East Asia and
China.
PT Tri Polyta Indonesia Tbk (“TPIA”)
Petrochemicals
The Company is the largest Indonesian
manufacturer of polypropylene resins.
Polypropylene resins is widely used in
various plastic packaging applications
and is produced using propylene, which
is derived by processing naphtha or
propane.
PT. Tri Polyta Indonesia Tbk
The polypropylene resins produced
included homopolymer, random
copolymer and impact copolymer.
Homopolymer products are mainly
used to manufacture a wide range
of consumer products such as food
packaging, plastic housewares,
cigarettes wrap, woven sacks, carpet
backing, and other applications.
Impact copolymers production was
suspended in 2004 due to unfavorable
market condition. In 2007, as the
impact copolymer segment showed
strong growth, the Company has
re-entered the segment with better
formulated products. The Company
markets its products under the trade
name of Trilene® primarily in the
Indonesia markets.
Meanwhile, random copolymer
products are mainly used to produce
plastic bottle containers such as
cooking oil containers, toiletries
bottles and other liquid containers.
Impact copolymer products are used
in manufacturing automotive parts,
electronic appliances and other
applications.
In 2007, the Company re-activated the
reactor in the third production train.
The three trains have a combined annual
capacity to produce between 360,000 to
380,000 metric tons of polypropylene,
depending on the production mix.
The Company received its ISO 9002
certification in 1996, ISO 14001
certification in 2000 and subsequently
ISO 9001 certification in 2002.
Overview
Established in 1988, TPIA is the largest Indonesian manufacturer of
polypropylene resins, which is widely used in various plastic packaging
applications.
•TPIA markets its products
under the trade name of
Trilene ® primarily in the
Indonesia markets.
B a r i to Pa ci f i c Natu ra l Em p owe r m e nt _ 1 3
• TPIA operates three
production trains, two
production trains are for
homopolymer and copolymer
production and the third is
specifically used for impact
copolymer production.
• The three trains have a
combined annual capacity
to produce between
360,000 to 380,000 metric
tons of polypropylene,
depending on the
production mix
Our core asset
Properties
The Company employs a high quality group of people, working closely together and
taking pride in the values and tradition of their work place. The success in facing many
challenges in the past has restored and rekindled a new sense of trust among
the stakeholders of the Company, especially the employees.
PT Griya Idola (“GI”)
Being a fully diversified resource-based enterprise, developing and managing
properties will be increasingly central to Barito Pacific’s interests in the future.
Overview
• Owner and operator of
Wisma Barito Pacific,
an office complex with
twin towers that sits
on 8,672 sqm of lands
at the centre of Jakarta
business district.
• Owns entitlement to
several plots of land
with a total area of
179,240 sqm in several
strategic location of
Jakarta.
• In 2007, GI posted a
total revenue of
US$ 1.8 million.
PT Griya Idola owns and operates
Wisma Barito Pacific, an office
complex with twin towers that sits on
8.672 sqm of lands at the centre of
Jakarta business district. It also owns
entitlement to several plots of land
with a total area of 179.240 sqm in
several strategic location of Jakarta.
Barito Pacific is complementing this
bond by enhancing the competence
and quality of our Human Resources
through various training programs both
within and outside the Company. We also
undertook an organizational expansion
by starting to recruit middle managers
and higher-ranking executives in order to
strengthen our management team.
This makes PT Griya Idola a key and
strategic component of the Barito
Pacific Group.
The entry of several senior staff from a
variety of backgrounds will accelerate the
transformation process of Barito Pacific.
Meanwhile, as the property owner
and manager of the twin towers,
Wisma Barito Pacific, since 1990
Griya Idola has long had a solid and
profitable business in its own right.
Griya Idola generates stable and
growing rental and services revenues,
and is well-positioned to capitalize
on future growth opportunities by
developing the close to 5,290 sqm
plot of land adjacent to the Wisma
Barito Pacific Towers.
1 4 _ Barito Pacific Natural Em p ower m ent
B a r i to Pa ci f i c Natu ra l Em p owe r m e nt _ 1 5
Also, with respect to the transformation,
the Company is currently in the process of
analyzing its organizational requirements.
It is revamping its organizational structure
to align with the Company’s growth needs
for the short to medium-term future, in
order to compete effectively in each of its
business lines.
Working with society
The Company employs a high quality group of people, working closely
together and taking pride in the values and tradition of their work place.
The success in facing many challenges in the past has restored and
rekindled a new sense of trust among the stakeholders of the Company,
especially the employees.
Corporate Information
Barito Pacific understands that
communities and the environment are
integral to the Company’s business over
the long term. Various social programs
are carried out by Barito Pacific as part of
the Company’s care and concern over the
welfare of communities.
In a broader context, Barito Pacific
understands the significance of
environmental preservation. Both are at
the core of the Company’s attention when
dealing in Corporate Social Responsibility
(CSR) programs that are integrated,
focused and sustainable.
The presence of the Barito Pacific group
of companies in a number of areas
clearly provide economic benefits to
local communities; from conducting
educational activities, creating job
opportunities for the local workforce to
inducing economic activities.
Barito Pacific instills in its governance
policy the need for the Barito group
of companies to be socially and
environmentally responsible for all
of their business undertakings. The
implementation of this policy is evident
among other things by the successful
undertaking by the Barito Pacific Group
to apply the most stringent measures of
Safety, Health and Environmental (SHE)
protection at work.
We continuously utilize this pledge to
all our business aspects. Barito Pacific’s
timber operations have long been
recognized for their sustainable ‘green’
approach, whereas Chandra Asri and Tri
polyta have been certified ISO 14001 for
sound environmental management, and
rated “Green” by Indonesian Government
for its environmental friendly production
process.
1 6 _ Barito Pacific Natural Em p ower m ent
Head office
PT Barito Pacific Tbk
Wisma Barito Pacific Tower B, lt.8
JL. Let Jend S. Parman Kav 62-63
Jakarta 11410
Tel. +62 21 530 6711
Fax. +62 21 530 6681
www.barito-pacific.com
Investor Relations
Agustino Sudjono
PT Barito Pacific Tbk
Wisma Barito Pacific Tower B, lt.8
JL. Let Jend S. Parman Kav 62-63
Jakarta 11410
Tel. +62 21 530 6711
Fax. +62 21 530 6680
email: [email protected]