INDIKA ENERGY GROUP COMPANY UPDATE 9M 2020

PT Indika Energy Tbk.

November 2020

INDIKA ENERGY GROUP

COMPANY UPDATE

9M 2020

Investors and security holders are cautioned that this communication contains forward-looking statements

and that forward-looking statements are subject to various risks and uncertainties, many of which are difficult

to predict and are generally beyond the control of PT Indika Energy Tbk.

Neither PT Indika Energy Tbk., its affiliates nor any other person assumes responsibility for the accuracy

and completeness of the forward-looking statements in this communication.

This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities in

the United States or any other jurisdiction in which such offer, solicitation or sale would be unlawful prior to

registration or qualification under the securities laws of any such jurisdiction.

Disclaimers

3

Table of Contents

Page #

▪ Coal Price Outlook and Recent Development in Domestic Coal Sector 4 - 7

▪ Indika Energy - Overview 8

▪ Income Statement Analysis 9

▪ Highlights – Latest Cash and Debt Position 10 - 12

▪ Corporate Guidance 13

▪ Our View and Strategy 14 – 19

▪ New Growth Projects, Non-Coal Diversification 20 – 22

▪ ESG Highlights 23 – 26

▪ Appendix 27 - 48

4

Coal Outlook 2020 – Challenging environment

Newcastle, ICI-4 & ASPUS$/ton

• Demand for thermal coal remains driven by China, India and SEA

• Indonesia government plans to cut supply from 610 million tons in 2019 to 550 million tons in 2020.

• Covid-19 pandemic has caused lower demand in commodity sector, including for coal.

• China’s policy on coal remains key factor for price movement.

• Coal price has started to recover as of October 20.

• Thermal coal buyers in China had been looking for alternate sources in the wake of China banning Australian coal imports

• As nearing year-end, positive sentiment on the coal price as market expects China to renew import quotas for next year

52.8 51.3

67.1

95.7

80.9 80.1

95.2 97.2103.4 106.6

117.5

102.4 92.4

75.6 65.9 63.9 68.4

54.3 54.2

26.6 27.2 32.2 42.0 42.8 40.1 43.1 45.4 48.0 44.8 41.6

33.5 35.5 37.6 33.0 34.2 34.4 25.3 24.2

37.9 36.037.3

42.749.6

51.8 54.0 52.5 56.4 52.1 53.3 49.3 45.7 47.1 44.4 45.1 43.036.4 36.3

0

20

40

60

80

100

120

140

1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20

Newcastle ICI-4 ASP

5

Coal Outlook – LT demand remains solid

Source: BP Energy Outlook 2019

• In the LT basis, International Energy Agency forecasts higher global coal

consumption by 2030 and only marginally lower consumption by 2040

• Thermal coal remains the largest power generator in the world

• Growing demand driven by China, India and SE Asia ( Vietnam, Indonesia)

6

Indonesia Coal Sector

210.0272.0 304.0

356.0 381.0 365.0 331.0 364.0434.0 472.0

412.5 65.0

79.0 82.0

96.0 76.0 86.0 128.0 97.0

115.0 138.0

138.0

0.0

100.0

200.0

300.0

400.0

500.0

600.0

700.0

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019E 2020F

National Coal Production

Million Ton

73.8103.8 109.0 125.7 138.6

130.2

151.8 162.1156.2

160.8

0.0

50.0

100.0

150.0

200.0

250.0

300.0

350.0

2015 2016 2017 2018 2019 2020F

Indonesia Other Countries

China Coal Import

Million Ton

GWIndonesia LT Plan - Additional Power Generation 2019 – 2038

Coal Hydro Gas Geothermal Other renewable

• Government aims to control coal output in 2020, limiting at 550MT, as a

step to boost coal price

• No significant change on DMO policy with benchmark price at

USD70/ton and minimum allocation of 25%

• Indonesia coal export to China has been consistently increasing since

2015 to 2019.

• New mining law has been enacted which give certainty for CCOW

holders to extend the license.

• Coal still play as major contributor to additional domestic power

generation in the LT

Revised Mining Law No. 3 – 2020

7

Key points

• Authority to issue licenses and production approval now is at central government/ minister (previously

governor and head of regency had also)

• CCOW holders are guaranteed to extend their license, in the form of IUP-K, 2 x 10 years. For those

already got extension, can get another 10Y.

• Can keep existing size of operation area

• The extension can be applied 5 years prior to the expiration date. CCOW holders need to submit their

expansion plan to be reviewed by Ministry of Energy and Mining Resources

• Tax of 10% from net income (profit sharing), will be allocated 4% to central government and 6% to

regional government (further details will be determined under follow-up regulation)

For taxes such as royalty, corporate income tax, and others (including VAT), will be determined on the

follow-up regulation.

Indika Energy – A Leading Integrated and Diversified Company in Indonesia

8

4)

Revenue 9M20: US$1,538.7 million

Subsidiary 9M20 Revenues

(US$ mn)

9M19 Revenues

(US$ mn)

Kideco 918.5 1,194.3

Petrosea 249.9 378.7

Tripatra 269.4 304.1

Indika Resources 155.0 245.8

MBSS 40.9 60.6

Others 36.5 63.5

Total Gross Revenue 1,670.2 2,247.0

Elimination (131.6) (167.1)

Total Net Revenue 1,538.7 2,079.9

CAPITALIZE

INTEGRATE

LEVERAGEOPTIMIZE

DIVERSIFY

✓ Integrated energy value chain with portfolio spanning across Indonesia

✓ Well-placed to capture domestic economic growth and global economic recovery

✓ Provides complementary products and services to domestic and international customers

✓ Strong operating track-record, with focus on cost control and unlocking synergies within the Group

✓ Ongoing diversification initiatives such as renewables, digital technologies and gold mining (target 50% non-coal revenue by 2025)

✓ Strong focus on and commitment to ESG initiatives

✓ Prudent financial management, with established track record in debt and equity capital markets

Kideco55%

Indika Resources9%

Petrosea 15%

Tripatra16%

MBSS3%

Others 2%

Indika Energy’s Consolidated Income Statement Highlights

9

*) Consolidated EBITDA plus dividends received from associates

**) Core Profit refers to the current year’s profit attributable to the owner of the company, excluding non-operating gains / losses and

related taxes (amortization of intangible assets, impairment of assets, fair value changes on contingent consideration obligation, and

gain on revaluation).

Summary P&L Quarter Data Year To Date

3Q20 3Q19 YoY 2Q20 QoQ 9M20 9M19 YTD YoY

Revenues 409.7 699.4 -41.4% 487.4 -15.9% 1,538.7 2,079.9 -26.0%

COGS (369.7) (607.0) -39.1% (418.0) -11.6% (1,324.4) (1,752.0) -24.4%

Gross Profit 40.0 92.5 -56.7% 69.4 -42.3% 214.3 327.9 -34.6%

SG&A Expenses (28.8) (28.8) 3.5% (40.5) -28.9% (105.5) (100.4) 5.1%

Operating Profit 11.2 63.7 -82.4% 28.9 -61.2% 108.8 227.5 -52.2%

Pre tax Profit (38.5) (6.5) 491.3% 6.0 -742.6% (49.3) 53.5 -192.1%

Adjusted EBITDA *) 52.1 91.3 -43.0% 72.2 -27.9% 226.6 346.1 -34.5%

Income Tax 9.2 (8.0) -214.8% (4.0) -330.0% 4.3 (44.0) -109.8%

Core Profit (12.0) 0.6 -2183.1% 5.6 -312.6% (5.5) 57.0 -109.7%

Net Profit (30.6) (21.3) 43.7% (0.9) 3330.9% (52.5) (8.6) 509.4%

Gross Margin(%) 9.8% 13.2% -26.1% 14.2% -31.4% 13.9% 15.8% -11.7%

EBIT Margin(%) 2.7% 9.1% -70.0% 5.9% -53.8% 7.1% 10.9% -35.3%

Core Profit Margin(%) -2.9% 0.1% -3655.9% 1.2% -353.0% -0.4% 2.7% -113.1%

Net Profit Margin(%) -7.5% -3.0% 145.4% -0.2% 3981.2% -3.4% -0.4% 723.8%

488.5

48.886.1 1,125.0

337.8

55.7

0.0

200.0

400.0

600.0

800.0

1000.0

1200.0

1400.0

1600.0

CASH DEBT

Cash Fin. Assets Rest. Cash Bonds 2) Bank Loans 3) Leases 4)

Indika Energy – Strong Cash Position

10

601.71)

1,518.5

US$ million

Cash and Debt Breakdown as of 30 Sept 2020

1) PTRO: $92.4mn, MBSS: $43.3mn, Tripatra: $50.4mn, Kideco: $126.9mn, Indika Resources: $31.9mn, ILSS-Interport: $16.6mn, HoldCo: $240.2mn.

2) $265mn due 2022 (Senior Notes V), $285mn due 2023 (Senior Notes IV), and $575mn due 2024 (Senior Notes VI).

3) PTRO: $100.7mn, MBSS: $27.1mn, Tripatra: US$16.5mn; HoldCo: $193.4mn

4). PTRO $48.3mn; additional lease impact of new PSAK 73 : US$16.2mn

4)

Indika Energy – Sound Balance Sheet

11

Net Debt Ratio Long Dated Debt Maturity Profile

US$ millionUS$ million

Cash Breakdown by Subsidiaries LTM Free Cash Flow

US$ millionUS$ million

146.3

337.9 336.9 310.4 288.7

144.4 171.3114.1 126.9

67.8

59.681.3

84.7 92.4

60.3

152.5133.6

154.350.4

37.5

34.6 4040.3

43.3

2016 2017 2018 2019 9M20

HoldCo & Others Kideco Petrosea Tripatra MBSS

122.9

211.0

323.0

198.4 204.0

0

50

100

150

200

250

300

350

2016 2017 2018 2019 9M20

78 102

348 357

620

0

100

200

300

400

500

600

700

2020 2021 2022 2023 2024 2025 2026

3.2

2.4

1.1

2.1 2.9

0.7 0.6 0.6

0.9 1.0

-

0.5

1.0

1.5

2.0

2.5

3.0

3.5

-

200.0

400.0

600.0

800.0

1,000.0

2016 2017 2018 2019 9M20

Net debt Net debt to EBITDA Net debt to Equity

78 102 83 72 45

265 285

575 675

0

100

200

300

400

500

600

700

800

2020 2021 2022 2023 2024 2025 2026

Refinancing to support Indika Energy future growth

12

US$ million

Indika Energy successfully issued global bond of US$675million with 5-year tenor and 8.25% coupon

Sources & Uses

USD Million Sources

Original Issue (22 October 2020) 450

Tap Issue (4 November 2020) 225

Total 675

USD Million Uses

Call Balance 2022s, Including Call

Premium 274

Call Balance 2023s, Including Call

Premium 288

Repayment of principal debt matured in

202125

Diversification, and Transaction

Expenses 88

Total 675

Consolidated Debt Maturity Profile Post Liability Management

Loans & Lease Bonds

Indika Energy’s Operational Highlights Vs 2020 Corporate Guidance

13

Operational Data Guidance

2020

9M20 %

Revised

Budget 9M19

KIDECO

Production (MT) 33.1 23.9 25.6 -6.6%

Strip Ratio (x) 5.8 5.9 6.4 -7.8%

Newcastle Benchmark ($/ton) 60.0 58.9 78.0 -24.5%

Average Selling Price ($/ton) 38.4 38.8 45.7 -15.1%

Cash Cost xRoyalty ($/ton) 27.1 27.7 31.2 -11.2%

Overburden Volume (BCM) 191.8 141.3 163.3 -13.5%

PETROSEA

Overburden Volume (mBCM) 105.1 68.8 96.9 -29.0%

Coal Getting (MT) 27.3 19.0 24.6 -22.8%

MBSS

Barging Volume (MT) 25.3 18.6 19.1 -2.6%

Floating Crane Volume (MT) 7.8 7.6 8.6 -11.6%

INDIKA RESOURCES

Coal Traded Volume (MT) 4.8 3.5 5.1 -30.9%

MUTU Production Volume (MT) 1.3 1.1 1.2 -7.0%

CAPEX

2020

Revised

Budget 9M20 %

(US$M) (US$M)

Kideco 3.4 1.2 34.8%

Petrosea 38.2 21.9 57.2%

MBSS 12.7 10.4 82.0%

Tripatra- -

Indika Resources 4.0 1.9 47.1%

Interport 46.3 30.2 65.2%

Indika Holding

Company1.0 0.9 90.5%

Total Capex 105.6 66.4 62.9%

Strategies to Enhance Our Position as a Leading Integrated and Diversified

Indonesian Company

14

Continue to extract operational efficiencies and adopt a proactive approach to a lower coal price environment

Continuing to increase operational efficiency and reduce costs

Managing capital expenditure and negotiating with suppliers to distribute impact of adverse market conditions

Continuing to provide a high-quality service and ongoing efficiency and optimisation improvements at coal mining services

business

Continue to harness significant synergies among Group companies

Continuing to leverage intra-Group cross-selling opportunities

Centralising certain functions among Group companies (e.g. ICT, supply chain and procurement)

Further integration of capabilities across businesses to increase profitability

Diversify cash flows and increase revenue contribution from non-coal related businesses

Increasing non-coal customer segments for energy-related services

Exploring investment opportunities in non-coal mining sectors

Developing other non-coal businesses

Continue to exercise prudent financial management and maintain healthy operating cash flows

Using internally-generated cash ahead of external financing and maintaining a target total debt to EBITDA ratio

Ongoing focus on delevering and controlling costs to position to be able to take advantage of future opportunities

Generating sufficient cash flows from operations and diversifying access to available capital sources

Continue to exercise prudent financial management

15

Consolidated CAPEX

US$ millionTotal Debt and Total Cash

US$ million

✓ Lowering interest cost by buying back bonds / early debt repayment

partially refinanced by bank loans with lower interest rate (Fixed 3.4%

vs coupon of 6.375%)

✓ Net debt to EBITDA has declined from high 3.2x in 2016 to 2.9x as of

Sep 2020

✓ Cash balance remains strong at USD601.7m as of Sept 2020

✓ Selective capital spending – balancing maintenance capex and

replacement and additional capacity

1,073 1,038 1,026 977

806

1,440 1,476 1,523 1,504

421 406 411 339 312

729 763 704

602

-

200

400

600

800

1,000

1,200

1,400

1,600

2012 2013 2014 2015 2016 2017 2018 2019 9M20

Total Debt Total Cash

212.5

74.5 68.558.7

21.9

65.6

150.4 156.9

66.4

0

50

100

150

200

250

2012 2013 2014 2015 2016 2017 2018 2019 9M20

Group-wide cost saving and operational improvement initiatives

16

Oil Brent Price

US$/bbl Minerva Project - a technology based initiative,

using digitalization and data analysis. The initiative

is aimed to reduce cost (e.g fuel consumption),

improve efficiency and increase assets utilisation

(e.g fewer fleet requirement/ unit production).

More contracts for Petrosea in Kideco

Expanding existing projects (e.g fuel storage)

Value Creation : Synergy / Integration

41

-

10

20

30

40

50

60

70

80Jan

-19

Fe

b-1

9

Ma

r-1

9

Apr-

19

Ma

y-1

9

Jun

-19

Jul-

19

Aug

-19

Sep

-19

Oct-

19

No

v-1

9

De

c-1

9

Jan

-20

Fe

b-2

0

Ma

r-2

0

Apr-

20

Ma

y-2

0

Jun

-20

Jul-

20

Aug

-20

Sep

-20

17

Minerva Project: performance impact through innovative digital

mining adoption

Digital dispatch (brain of the

mine)

▪ Reduce number of trucks by ~10%

– 61% reduction in hanging time

– 49% reduction in queueing time

▪ ~50% increase in daily production

Digital maintenance system

using predictive analytics▪ Components with potential issues identified with ~80% accuracy

– 2-4 months in advance

▪ Extends component lifetimes by up to 130%

Real-time crew management ▪ Production increase of 32%

– Increase of utilization by 7%

– Increase of truck productivity by 15%

▪ 95% reduction in time taken to produce reports

▪ Single source of truth across organization

Digital operational mine

planning

▪ Rapid decision-making and escalation for non-compliance

▪ ~95% time saved for mine surveys and plan creation

▪ Transparent and predictable digger movement with clarity on reasons for delays

Digital control tower

Significant capex reduction and optimal mining operations translate to significantly higher cashflow generation and ROE for Petrosea

18

Petrosea has been inducted into WEF's Global Lighthouse Network

Industrial lighthouses are diversifying and digitizing beyond the four walls of the factory

Petrosea is the only local company in Indonesia and Southeast Asia with this status

19

Diversification Beyond Coal is a Core Part of Strategy

✓ Seeking to transition toward lower contribution from coal-related activities

✓ Target non-coal related businesses to make up c.50% of total revenue by 2025

✓ Various initiatives underway

✓ Energy Services and Energy Infrastructure targeting further expansion into oil & gas and

other sectors

✓ Diversification into minerals and precious metals

✓ Evaluation of opportunities in renewable energy

✓ Benefit of synergies across businesses (e.g. Petrosea providing FEED to Awak Mas and also

targeting E&C services)

✓ Financial prudence and discipline maintained for all investments

Awak Mas Gold Project

Key Highlights

Gold project in South Sulawesi (est.1.5Moz reserves, 2.3Moz

resources)

In the process of increasing beneficial equity interests to 53.9%

Definitive feasibility study completed 2018

Cost of development expected to be c.USD200mn

First production expected in mid-2022 and 16-year mine life(2)

c.100kozpa production (128kozpa for the first four years) with

estimated NPV of USD517mn(2)

Selected Other Initiatives

(1) Revenue is pre-elimination of intersegment sales

(2) Per Nusantara Resources Noosa Mining presentation Jul-2020. NPV calculated at gold price of USD1,700/oz

Project Key Highlights

Petrosea E&C services to Freeport Indonesia, which operates the Grasberg gold and copper mine

Providing FEED services to Awak Mas Gold Project; also targeting E&C services

Tripatra Providing EPC and O&M services in oil and gas, petrochemical and geothermal sectors

Fuel Storage

96mnL capacity fuel storage facility in East Kalimantan under construction

Expected commercial operations by end 2020

Leased to ExxonMobil (initial 20-year term with option to extend for additional 10 years)

Plans to begin construction of second fuel storage terminal in Gresik, East Java in 2021

Green

Initiatives

Exploring business opportunities in renewable energy and other related businesses

IMP business arm (biomass wood pellet production and carbon trading)

Technology

Minerva: In-house technology platform that optimizes fleet performance and coal production

efficiency for contract mining; intention to offer to other mining services providers

Two ICT companies (Xapiens and Zebra X) support Group’s IT systems; intention to offer services

to external customers in near future

55%

6%

9%

6%

16%

Coal Trading

Kideco

4%

2%

Tripatra

MUTU

MBSS

Petrosea E&C & etc

Petrosea Mining

2%

Others

Non Coal : 24%

Coal : 76%

20

Diversification Investments – Fuel Storage Project

Build and operate fuel storages exclusively for ExxonMobil

Location : Balikpapan, Kariangau, East Kalimantan

Project Company : PT Karingau Gapura Terminal Energy

Total Project Cost : US$115million

Funding Structure : US$75 million - bank loan & US$38 million - equity

Storage Capacity : 75ML – Diesel; 13ML – MoGas; - 8ML –B100

Construction Periods : 18 months starting January 2019

COD : Commercial operation as of 9 November 20

Contractors : Tripatra & Petrosea

Phase 1

21

Diversification Investments – Gold Asset Project

A Strategic investment in Nusantara Resources Limited (ASX: NUS).

Nusantara owned 100% PT Masmindo Dwi Area which has sole rights

to exploit in Awak Mas Gold Project

Location : South Sulawesi, 370 km from Makasar

Potential Resources : 2.35 million onz

Potential Reserves : 1.53 million onz

Total Project Cost : US$150 - 200 million

Target Production : 2H22

License : COW (Contract of Work) amended in March 2018

Total concession : 14,390Ha, explored area ± 2,000Ha

Current Status : FEED

Definitive feasibility study has been completed in 2018

Ownership : Total 45.8% in Masmindo , through 27.8% in Nusantara Resources

Limited & 25% direct ownership in Masmindo (with option to

increase up to 40%)

Potential Direct or Indirect ownership = 56.7% (exc. Petrosea’s portion in Masmindo)

Awak Mas/Masmindo Gold Project – Investment Structure

22

23.2%

1st Stage: USD 15m

For 25% in MDWI

Indika Energy

Nusantara (ASX Listed)

Masmindo DWI Area

75%

2nd Stage: USD 25m

For 15% in MDWI

Project Activities 2 stage

Stage 1 : during 2020 to reach Final Investment Decision

Complete: FEED

Detailed Design, permit for Tailings Storage Facility (TSF)

Land Access and compensation

Early Civil works

Conclude Debt and equity funding

Stage 2: late 2020

Award major contracts

Full scale construction

Commissioning is expected 2Y from Final Investment Decision

Ownership: Has exercised first stage option; paid USD 15m and

owns 25% of Masmindo. Transaction has been approved by MEMR

on 25 Aug 20.

Final Investment

Decision

25%

Current

After 2nd

Option

Direct ownership 25.00% 40.00%

Indirect through Nusantara 17.40% 13.92%

Total 42.40% 53.92%

Strong Focus on and Commitment to ESG Initiatives

23

Environmental

✓ Comply with all Indonesian environmental laws,

regulations and standards

✓ Strong focus on five key elements

✓ Climate change (Greenhouse gas and carbon

emissions)

✓ Water & effluents

✓ Waste management

✓ Biodiversity conservation

✓ Environmentally friendly initiatives

✓ Environmentally friendly technologies at operations

✓ Ultra-supercritical coal-fired technology which reduces

CO2 emissions

✓ Solar panels at Kideco and CEP

✓ Low ash and sulfur Kideco coal relatively cleaner

burning

✓ Industry 4.0 (decreased materials, fuel and spare parts

usage)

✓ Environmental management practises recognized by

governments

✓ Kideco received Gold PROPER award from Ministry of

Environment and Forestry

✓ Promote green activities, including by partnering with

local communities

✓ Contribute to Indonesia’s wildlife protection efforts

Social Responsibility

✓ Focus on supporting long-term economic growth and

improving the quality of life in regions of operation

Governance

✓ Continuously implementing and improving good

corporate governance

✓ Recent addition of three individuals to Board of

Directors, including a female member (representing

20% of the board)

✓ Robust anti-bribery management system – Petrosea

obtained ISO37001 while the group and other

subsidiaries are in the process of obtaining

✓ Complying with prevailing laws and regulations

Transparency

Accountability

Responsibility

Independence

Fairness & Equality

Corporate Principles

Education Develop education infrastructure

Provide scholarships and key skills

vocational training

Health and

Safety

Employees receive mandatory health

and safety specialized training

Comply with Indonesian safety and

health standards

Engage in programs to promote

healthier living in the community

Community

Significant portion of site workforce

from local areas

Support small community businesses

Sponsor infrastructure development in

local communities

Collaboration with key welfare

organisations (Indorelawan)

Intercultural Innovation Awards (UNAOC(1) and

BMW Group)1

“Achievements in promoting national tolerance and diversity”

(1) United Nations Alliance of Civilizations

Environment

24

Integrating Environmental SDGs into Operations

Regional & Central Government Recognition on

Environmental Management

2015 2016 2017 2018 2019

Ministry of

Environment &

Forestry

Green Green Green Green Gold

International HSE Standards in Our Operations

✓ Occupational Health & Safety Management System ISO 45001:2018

✓ Environmental Management System ISO 14001: 2015

✓ Comply with all Indonesian environmental laws, regulations and standards

✓ Asset environmental impact based on five key factors

✓ Environmentally friendly technologies at operations

✓ Promote green activities, including by partnering with local communities to

rehabilitate mangrove and tree planting

✓ Contribute to Indonesia’s wildlife protection efforts

Parameter Emission

Regulation Cirebon Power

Particle (mg/Nm3) 100 31

SOx (mg/Nm3) 750 87

NOx (mg/Nm3) 750 219

Opacity (%) 20 10

Cirebon 660MW Power Plant Produces Cleaner Emissions

Nature and Energy Saving Programs at Kideco

2018 2019 Change

Reclamation 4,147.08ha 4,675.05ha +12.7%

Intensity of GHG

Emission0.0330t CO₂ / mnt 0.0316t CO₂ / mnt

-4.2%

Reduced GHG

Emission Load105,613t Eq CO₂ 107,263t Eq CO₂

+1.6%

Social Responsibility

25

Education

Develop education infrastructure

Provide scholarships and key skills vocational training

Engineering camps

Provide computer literacy and education equivalency programs for school

students

Educational programs for remote indigenous people and marginalized

communities

Health and Safety

Engage in programs to promote healthier living in the community

Working with local governments on managing COVID-19 pandemic

Comply with Indonesian health and safety standards

HSE management system in accordance with OHSAS 18001:2007

Employees receive mandatory health and safety specialized training

Personal protective equipment provided for all employees

Established emergency medical facility at mine sites

Established committee who review Occupational, Health and Safety issues

Community

Empowerment

Significant portion of site workforce from local areas

Donate to local schools in communities surrounding our operations

Entrepreneurship programs

Assist in disaster relief programs

Support small community businesses (capacity building and microfinancing)

Sponsor infrastructure development in local communities

Key Initiatives

Protect health and wellbeing of Indika’s people and have a positive impact in the community

Indika Foundation

✓ Established in 2017

✓ Key initiatives and programs

✓ Education

✓ Health

✓ Community and economic empowerment

✓ Promoting national peace and tolerance

Intercultural Innovation Awards (UNAOC(1) and BMW Group)1

“Achievements in promoting national tolerance and diversity”

(1) United Nations Alliance of Civilizations

Governance

26

✓ Continuously implementing and improving good corporate governance

✓ Recent addition of three individuals to Board of Directors, including a

female member (representing 20% of the board)

✓ Women in key executive positions increased from 8% to 12% in 2019

✓ Robust anti-bribery management system – Petrosea obtained ISO37001

while the group and other subsidiaries are in the process of obtaining

✓ Complying with prevailing laws and regulations, including those established

by the OJK(1) and Indonesian Stock Exchange

Recognition on Transparency and Disclosure to Stakeholders

Ranked 1st Most Honoured Company (basic materials sector) in 2019 –

from Institutional Investor

Awarded The Best Public Company, Energy sector in 2019 – from CNBC

Indonesia

Criteria Evaluation:

Balance sheet transparency

Communication strategy shifts

Clarity on debt covenant calculation and other provisions

Responsiveness to questions on debt ratings

Engagement with bondholders

High Commitment on

GCG Principles

Commitment to Highly Ethical Business

Practices

1. Transparency

2. Accountability

3. Responsibility

4. Independency

5. Fairness & Equality

1. High integrity in business

2. Mandatory integrity pact for all employees

3. Anti-corruption and Anti-bribery

4. Whistle blowing system

5. Avoiding conflicts of interest

Organisational Structure

General Shareholders’

Meeting

Board of Commissioners

Board of Directors

Managing Director/ CEO

Management Executives

Human Capital

Committee

Audit, Risk &

Compliance Committee

Project & Investment

Committee

Corporate Secretary

Internal Audit

CEO Office

(1) Otoritas Jasa Keuangan (Financial Services authority)

Protocols in place for the supervision and assessment of the

Board of Commissioners and Board of Directors

Appendix

27

28

PT Indika Energy Tbk.

Energy Services Energy InfrastructureEnergy Resources

▪

-Established since 1991

-3rd largest coal producer

-Resources 1,625 MT, reserves

569 MT as of end Dec 2017

-91.0% ownership as of 6 Dec.

2017

▪

-Established since 1989

-Bituminous thermal & coking coal

-Resources 75.2 MT, reserves

40.6 MT

-85.0% ownership

▪

-Established since 2012

-Coal trading, ~7.0 MT volume

▪

-Established since 1994

- Integrated water coal transportation

and logistic

-51% ownership

▪

-Established since 2007

-20.0% owned 660MW, enviro-

friendly supercritical technology

-6.25% owned 1000MW expansion ,

ultra supercritical technology (under

construction)

▪

-Established since 2018

- Integrated logistic services

-Build and operate fuel storage

facility

-Port Business Entity license to

operate and provide port and logistic

services at all Indonesia major ports

▪

-Established since 1973

-Leading EPC and O&M services in

oil & gas and power generation

-100% ownership

▪

-Established since 1972

-Coal contract mining and E&C

capabilities in mining and oil and

gas

-69.8% ownership

Other Portfolios

▪

-Established since 2011

- Investment company in mineral

mining

-Developing gold project Awak Mas

in South Sulawesi

-Resources 2 million oz, reserves

1,1 million oz

-21% ownership

4321

Indika Energy, Indonesia’s leading fully integrated energy company

29

As a Group, Indika Energy creates synergy and offers comprehensive

set of multi-sector expertise and competencies

Example: IEG end-to-end competencies in coal value chain

En

erg

y

reso

urc

es

En

erg

y s

erv

ice

sE

ne

rgy in

fra

str

uc

ture

Identification /

acquisition of assets

Exploration

Economic and

feasibility study

Engineering and

construction

Production

Processing

Land transportation

Barging

Loading /

transshipment

Power generation

Offtake sales

• Operational synergy from intra-Group cross-selling opportunities- Petrosea and MBSS provides part of Kideco's

overburden removal, coal barging and transshipment services

- Kideco provides 1.9mt of coal per year to CEP- MBSS provides coal barging and transshipment

services to MUTU and Kideco

• Cost synergy from integrated operations (work-sharing and knowledge-sharing) among Tripatra, Petrosea and MBSS

• Increasingly stable earnings and cashflow from continued multi-sector diversification

Synergy across the Group

Total Backlog Total Backlog Total Backlog 660MW Power Plant

$835.3M $97.2M $40.1M

9M20 Net Income 9M20 Net Income 6M20 Net Income 9M20 Net Income

$13.2M - $7.5M $7.6M $4.7 (20% Indika)

9M20 EBITDA Margin 9M20 EBITDA Margin 9M20 Adj. EBITDA Margin 9M20 EBITDA Margin

29.9% 26.7% 6.0% 30.1%

ROE ROE ROE ROE

6.1% - 4.6% 6.4% 6.1%

30

Indika Energy Subsidiary Results

Petrosea MBSS Tripatra Cirebon Electric Power

• Coal contract mining and E&C

capabilities

• Opportunity to increase group

synergies by winning more Kideco

contracting share

• 69.8% ownership

• Integrated coal transport & logistics

business

• Consists of 78 barges, 87 tugboats,

1 support vessel, 4 floating cranes

and 2 floating loading facilities

• 51% ownership

• Multi-disciplined engineering/EPC

and project capabilities

• Two subsidiaries:

1. PT Cotrans Asia – 45% stake

barging / transportation business

2. PT Sea Bridge Shipping – 46%

stake; domestic coal

transshipment for Kideco

• Kideco cross sells approximately

1.7MT to CEP annually

• Indika’s portion of net income in

FY19 is US$6.9M

• 20% ownership of CEP

• 6.25% ownership of CEP II

(expansion project)

Indika Energy’s Subsidiaries Backlog

31

Descriptions

Remaining

Contract Value

New Contract/

Adjustment ValueRevenue

Recognition

Remaining

Contract Valuein 2020

Per 31 Dec 2019 Per 30 Sep 2020 Per 30 Sep 2020

Petrosea

Contract mining 483.1 406.4 151.7 737.8

E&C 120.1 (11.4) 46.5 62.2

POSB 51.4 3.0 19.1 35.3

Total (USD mn) 654.6 398.0 217.3 835.3

Tripatra

Tripatra Engineers & Constructors 251.7 28.0 249.3 30.4

Tripatra Engineering 21.3 9.8 21.5 9.6

Total (USD mn) 273.1 37.8 270.8 40.1

MBSS

Barging 35.0 41.0 29.1 46.9

Floating Crane 40.4 21.6 11.7 50.3

Total (USD mn) 75.4 62.7 40.9 97.2

Total Consolidated (USD mn) 1,003.1 498.4 529.0 972.6

32

Indika Energy’s Financial Highlights

Gross Profit (USD mn) Operating Profit (USD mn)

Income from Associates (USD mn)Core Profit/Loss**

(USD mn)

Net Profit/Loss*(USD mn)

* Profit/loss for the period attributable to owners of the company** Core Profit refers to the current year’s profit attributable to the owner of the company, excluding non-operating gains / losses and related taxes

(amortization of intangible assets, impairment of assets, fair value changes on contingent consideration obligation, gain on revaluation, acceleration on

amortization of bond issuance cost).

.

Revenues (USD mn)

775.2

1,098.8

2,962.9

2,079.9

1,538.7

-

500.0

1,000.0

1,500.0

2,000.0

2,500.0

3,000.0

3,500.0

2016 2017 2018 2019 9M20

88.7 122.9

641.2

426.7

214.3

0

130

260

390

520

650

780

2016 2017 2018 2019 9M20

(10.1)34.1

508.1

289.5

108.8

-100

0

100

200

300

400

500

600

700

800

2016 2017 2018 2019 9M20

59.5

136.2

20.6 30.0

21.3

0

40

80

120

160

2016 2017 2018 2019 9M20(65.9)

335.5

80.1

(18.2)

(52.5)

-100

0

100

200

300

400

2016 2017 2018 2019 9M20

(43.3)

94.5

168.4

75.5

(5.5)

-100

-50

0

50

100

150

200

2016 2017 2018 2019 9M20

Gross Debt & Net Debt / LTM Adj. EBITDA (x)

Adj. FCF / Debt (%)

Debt / Capital (%)

33

Indika Energy’s Key Business and Credit Ratios

LTM Adj EBIT / Interest (x)

LTM Adj EBITDA* (USD mn) & LTM Adj EBITDA

Margin (%)

LTM Adj EBIT (USD mn) & EBIT Margin (%)

155.7

291.9

652.5

436.0 319.6 20.1%

26.6%

15.6% 15.7%14.3%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

-

100.0

200.0

300.0

400.0

500.0

600.0

700.0

2016 2017 2018 2019 9M20

EBITDA EBITDA Margin

5.2 4.9

2.3

3.5

4.7

3.2

2.4

1.1

1.9

2.9

-

1.0

2.0

3.0

4.0

5.0

6.0

2016 2017 2018 2019 9M20

52.3%

56.4% 56.7%

59.9%

61.8%

46.0%

48.0%

50.0%

52.0%

54.0%

56.0%

58.0%

60.0%

62.0%

64.0%

2016 2017 2018 2019 9M20

74.6

330.8

519.9

298.7

180.3

9.6%

30.1%

17.5%

10.7%8.1%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

0.0

100.0

200.0

300.0

400.0

500.0

600.0

2016 2017 2018 2019 9M20

Adj. EBIT EBIT Margin

1.2

0.4

5.1

2.6

1.8

0.0

1.0

2.0

3.0

4.0

5.0

6.0

2016 2017 2018 2019 9M20

16.6%15.7%

21.9%

13.0% 13.6%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

2016 2017 2018 2019 9M20

39.0

32.1 32.0 34.0 34.3

29.7

3.4

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

2015 2016 2017 2018 2019 2020F

Actual Gov Approval Additional Target

34

Kideco – Leading Coal Producer in Indonesia

SM 4200-4300 Kcal

65%

Blended 4500 Kcal

8%

Roto 4900 Kcal

27%

Kideco Product Mix Kideco Production

Million Ton

33.1

Kideco Sales – by country

• Third largest coal producer in Indonesia

• Environmental friendly thermal coal with ultra-low sulphur of 0.1% and low ash of

(2.1% to 4.9%)

• Attractive location with well-built infrastructure, and integrated value chain within

the group, allowing for strong control over operation

• Low cost coal producer

• Resources of 1,550 MT and reserves of 531 MT based on JORC report Dec 2019

• Geographically diversified customer base

China35%

Indonesia31%

Korea3%

India11%

Taiwan4%

Southeast Asia12%

Japan3%

Others1%

35

Kideco’s Financial Highlights

Revenues (USD mn) Gross Profit (USD mn) Operating Profit (USD mn)

Net Profit (USD mn) EBITDA (USD mn) Cash Balance (USD mn)

1,247.8

1,633.0

1,802.2

1,574.2

918.5

0

400

800

1,200

1,600

2,000

2016 2017 2018 2019 9M20

88.6

277.1260.1

119.8

54.0

0

50

100

150

200

250

300

2016 2017 2018 2019 9M20

179.7

526.0489.5

245.7

117.7

0

100

200

300

400

500

600

2016 2017 2018 2019 9M20

32.8

144.4

171.3

114.3126.9

0

50

100

150

200

250

2016 2017 2018 2019 9M20

180.0

527.8492.1

248.5

129.5

0.0

100.0

200.0

300.0

400.0

500.0

600.0

2016 2017 2018 2019 9M20

155.4

469.4450.3

208.2

100.9

0

100

200

300

400

500

2016 2017 2018 2019 9M20

36

Kideco’s Operational Highlights

Cash Cost Breakdown Coal Production (mn ton) Coal Sales (mn ton)

Stripping Ratio (x) Average Selling Price (USD/ton) Cash Cost (USD mn)

32.1 32.034.0 34.3

23.9

0.0

15.0

30.0

45.0

2016 2017 2018 2019 9M20

32.5 31.534.1 34.9

23.7

0

15

30

45

2016 2017 2018 2019 9M20

6.0 6.1 6.3 6.35.9

0.0

2.0

4.0

6.0

8.0

2016 2018 2018 2019 9M20

38.4

51.9 52.9

45.1

38.8

0

15

30

45

60

2016 2017 2018 2019 9M20

32.134.4

37.8 37.3

32.6

27.6 28.030.9 31.2

27.7

2016 2017 2018 2019 9M20

Incl Royalty Excl Royalty

Contract Mining + Rental63%

Gov. Royalty

15%

Material9%

Freight5%

O/H7%

Labor1%

Others0%

Kideco’s Operational Highlights

37

Summary P&L (US$mn)Quarter Data Yearly Data

3Q20 2Q19 YoY 2Q20 QoQ 9M20 9M19 YoY

Sales 255.3 384.3 -33.6% 286.9 -11.0% 918.5 1194.3 -23.1%

Gross profit 15.9 37.9 -58.0% 46.1 -65.5% 129.5 200.1 -35.3%

Operating profit 9.1 33.2 -72.5% 34.9 -73.9% 100.9 171.9 -41.3%

Net income 7.3 21.3 -65.5% 21.6 -66.0% 54.0 100.5 -46.3%

EBITDA 14.8 43.1 -65.7% 40.6 -63.6% 117.7 196.3 -40.0%

Gross margin 6.2% 9.9% -36.8% 16.1% -61.2% 14.1% 16.8% -15.8%

Operating margin 3.6% 8.6% -58.6% 12.2% -70.6% 11.0% 14.4% -23.6%

Net margin 2.9% 5.5% -48.1% 7.5% -61.8% 5.9% 8.4% -30.1%

EBITDA margin 5.8% 11.2% -48.4% 14.1% -59.1% 12.8% 16.4% -22.0%

Overburden (mn bcm) 46.3 65.3 -29.0% 48.5 -4.6% 141.3 163.3 -13.4%

Production volume (Mt) 7.1 9.1 -22.7% 8.1 -12.9% 23.9 25.6 -6.7%

Sales volume (Mt) 7.0 8.7 -18.7% 7.9 -10.9% 23.7 26.1 -9.4%

Stripping ratio (X) 6.6 7.2 -8.2% 6.0 9.5% 5.9 6.4 -7.2%

Cash Cost excl royalty

(US$/ton)28.8 33.7 -14.4% 24.8 16.4% 27.7 31.2 -11.0%

Average selling price (US$/ton) 36.3 44.4 -18.3% 36.4 -0.1% 38.8 45.7 -15.1%

Peer Comparison (6M20 Data)

38

EBITDA MARGIN

PRODUCTION ANNUAL (MT) STRIP RATIO (x)

RESERVE/RESOURCE RATIO

CASH COSTS ex Royalty (US$/t)

Domestic Sales/ Total (DMO 25%)

*Kideco only

DMO requirement

55

34

24

18

0

10

20

30

40

50

60

ADRO INDY * PTBA ITMG

4.43.8

5.6

10.7

0

2

4

6

8

10

12

PTBA ADRO INDY * ITMG

34%

26%

12%

16%

0%

5%

10%

15%

20%

25%

30%

35%

40%

ADRO PTBA ITMG INDY*

60%

29%

22%

13%

0%

10%

20%

30%

40%

50%

60%

70%

PTBA INDY ADRO ITMG

16%

22%

31%

40%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

ITMG ADRO INDY PTBA

30

37

27

51

-

10

20

30

40

50

60

ADRO PTBA INDY * ITMG

39

Petrosea’s Financial Highlights (1)

Revenues (USD mn)

*

EBITDA (USD mn)Coal Getting Volume (MT) Net Profit/Loss* (USD mn)

Gross Profit (USD mn) Overburden Removal (mbcm)

209.4

313.5

465.7 476.4

249.9

0

100

200

300

400

500

600

2016 2017 2018 2019 9M20

34.9

45.7

73.1

81.1

47.7

0

20

40

60

80

100

2016 2017 2018 2019 9M20

57.3

97.6

121.1 123.5

68.7

0

35

70

105

140

2016 2017 2018 2019 9M20

14.2

24.8

34.6

31.0

19.0

0

8

16

24

32

40

2016 2017 2018 2019 9M20

63.874.6

116.8127.1

74.6

0

30

60

90

120

150

2016 2017 2018 2019 9M20(7.9)

11.6

23.4

31.3

13.2

(15.0)

0.0

15.0

30.0

45.0

2016 2017 2018 2019 9M20

40

Petrosea’s Financial Highlights (2)

*

Revenues Breakdown by Value

*Cost Structure

9M20: USD249.9 mn 9M19: USD378.7 mn

9M20: USD202.2 mn 9M19: USD321.6 mn

Contract Mining60.7%

E&C18.6%

POSB7.6%

KPI11.3%

Others1.7%

Contract Mining58.2%

E&C22.7%

POSB9.7%

KPI8.8%

Other0.6%

Salary35.6%

Operations19.7%

Depre22.2%

Subs & Rental15.1%

Rental3.1%

Amortization0.4%

Material3.3%

Other0.6%

Salary26.8%

Operations26.2%

Depre16.7%

Subs & Rental13.4%

Rental8.6%

Amortization0.0%

Material7.9%

Other0.4%

41

Tripatra’s Financial Highlights (1)

* Profit/loss for the period attributable to owners of the company

** Including dividends from associates

Month/year Month/year

Revenue (USD mn) Gross Profit (USD mn) Net Profit* (USD mn)

Income from Associates (USD mn)

Month/year Month/year

Adjusted EBITDA** (USD mn)

217.5

274.8 278.3

462.3

269.4

0

125

250

375

500

2016 2017 2018 2019 9M20

34.2

45.041.7

37.5

19.7

0

15

30

45

60

2016 2017 2018 2019 9M20

22.825.8

28.4

16.9

7.6

0

10

20

30

40

2016 2017 2018 2019 9M20

28.0

35.2 35.1

29.2

16.2

0

8

16

24

32

40

2016 2017 2018 2019 9M20

9.28.4

10.2 10.2

6.0

0

3

6

9

12

2016 2017 2018 2019 9M20

42

Tripatra’s Financial Highlights (2)

*

Revenues Breakdown by Value

Cost Structure

9M20: USD269.4mn 9M19: USD304.1mn

9M20 USD218.2 mn 9M19: USD247.2 mn

TPEC92.1%

TPE7.9%

TPEC92.0%

TPE8.0%

Material3.5%

Sub Contractors

48.6%

Salary6.2%

Handling5.8%

Rental2.3%

Others33.7%

Material16.3%

Sub Contractors

35.2%

Salary6.2%

Handling8.5%

Rental5.8%

Others28.1%

43

MBSS’ Financial Highlights (1) *

Revenues (USD mn)

Net Profit (USD mn)

EBITDA (USD mn)

Floating Crane Vol. (mn ton)Barging Vol. (mn ton)

Gross Profit (USD mn)

65.8 68.5 75.4 77.8

40.9

-

25.0

50.0

75.0

100.0

2016 2017 2018 2019 9m20

0.9

2.5

4.9

18.4

1.4

0

4

8

12

16

20

2016 2017 2018 2019 9M20

14.8

18.4

24.0

27.7

10.9

0

5

10

15

20

25

30

2016 2017 2018 2019 9M20

-29.9

-8.9

-18.2

4.3

-7.5

-35

-30

-25

-20

-15

-10

-5

0

5

2016 2017 2018 2019 9M2022.1

18.5

22.1

25.0

18.6

0

5

10

15

20

25

30

2016 2017 2018 2019 9M20

12.9

8.7

11.810.1

7.6

0

5

10

15

20

25

2016 2017 2018 2019 9M20

44

MBSS’ Financial Highlights (2)

*

Revenues Breakdown

*Cost Structure

9M20: USD39.5 mn 9M19: USD48.9mn

9M20 USD40.9mn 9M19: USD60.6mn

Barging71%

FC 29%

Barging73%

FC 27%

Depreciation42%

Fuel13%

Salaries12%

Port charges7%

Spareparts13%

Charter0% Others

13%

Depreciation36.6%

Fuel18.3%

Salaries12.9%

Port charges7.4%

Spareparts6.7%

Charter4.2%

Others13.9%

Indika Resources’ Financial Highlights

Revenues (USD mn)

Net Profit (USD mn)

Gross Profit (USD mn)

MUTU Production Vol. (mn ton)Coal Trading Vol. (mn ton)

Cost of Good Sold (USD mn)

45

216.7

319.8

395.6

322.1

153.2

-

50.0

100.0

150.0

200.0

250.0

300.0

350.0

400.0

450.0

2016 2017 2018 2019 9M20

209.3

306.5

359.4

300.8

135.7

-

50.0

100.0

150.0

200.0

250.0

300.0

350.0

400.0

2016 2017 2018 2019 9M20

7.4

13.3

36.2

21.3

17.5

-

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

2016 2017 2018 2019 9M20

(15.6)

(142.4)

2.4 4.3 1.4

(160.0)

(140.0)

(120.0)

(100.0)

(80.0)

(60.0)

(40.0)

(20.0)

-

20.0

2016 2017 2018 2019 9M206.8 6.8

8.4

6.5

3.5

0

2

4

6

8

10

2016 2017 2018 2019 9M20

0.1

0.5

1.2

1.6

1.1

0

0.5

1

1.5

2

2016 2017 2018 2019 9M20

46

Indika Resources’ Financial Highlights (2)

*

Revenues Breakdown

*MUTU ASP (USD/ton)

9M20: USD155.0 mn 9M19: USD245.7 mn

MUTU Cash Cost ex Royalty (USD/ton)

Coal Trading61.4%

MUTU38.6%

Coal Trading62.7%

MUTU37.3%

66.5

78.3

87.6

76.3

61.9

0

20

40

60

80

100

2016 2017 2018 2019 9M20

66.5

78.387.6

76.3

61.9

0

20

40

60

80

100

120

2016 2017 2018 2019 9M20

Awards / Recognition in 2019

• CNBC Awards 2019 as “The Best Public Company in Energy Sector” -

PT Indika Energy Tbk

• The International Innovation Award 2019 for “Millenial Islami” –

Indika Foundation

• “Proper Nasional Hijau” environment management for Cirebon

Electric Power

• ASEAN Coal Award/ ACA 2019 – Kideco Jaya Agung

•Coal Mining Category – Sub Category Surface Mining (Winner)

• Indonesia Sustainable Development Goals Awards 2019 – Kideco

Jaya Agung

•Overall : Grand Platinum

•7 out of 11 individual programs : Platinum

•4 out of 11 individual programs: Gold

Kideco Assessment of Environment

Management by Government• Ranked 1st Most Honored Company (in basic material sector) – from

Institutional Investor

o Ranked 1st for Fixed Income Executive Team – High Yield

o Ranked 1st in Best Use of Debt – High Yield

o Ranked 3rd in Best Use of Debt – Investment Grade

48

Notes Outstanding

The Senior

Notes are rated:BB - / Negative Outlook

International Ratings (as of Mar 2020)

A + / Negative Outlook

National Ratings (as of Mar 2020)

Ba 3

Negative Outlook (as of May. 2020)

Indo Energy Capital III Pte. Ltd.

USD575.0 mn

5.875% 7-year Senior Notes

Reg S / 144A

due 2024

November 2017

Indo Energy Capital IV Pte. Ltd.

USD675.0 mn

8.25% 5-year Senior Notes

Reg S / 144A

due 2025

November 2020