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Kencana Agri Limited

1H 2012

Performance Review

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Disclaimer

This document has not been independently verified and has been prepared for

informational purposes only. No representation or warranty express or imply is

made as to, and no reliance should be placed on, the fairness, accuracy,

completeness or correctness of the information or opinions contained herein.

It is not the intention to provide, and you may not rely on this document as

providing, a complete or comprehensive analysis of the company’s financial or

trading position or prospects. The information and opinions contained in these

materials are provided as at the date of this presentation and are subject to

change without notice.

None of Kencana Agri Limited or any of its affiliates, advisers or representatives

shall have any liability whatsoever (in negligence or otherwise) for any loss

whatsoever arising from any use of this document or its contents.

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Total Production

2011 : 116,515 MT

1H2012 : 53,474 MT

No. of Palm Oil Mills : 4

Total Capacity : 190 MT/hour

Biomass Power Plant

Supporting Business

Port and Bulking Terminal

Logistics

No of Plant : 2 (Bangka,

Belitung)

Total Capacity : 13.5 MW

Palm Kernel

Cake

CPO

CPKO

Fresh Fruit Bunches (FFB)

Total Land bank :175,003* ha

Nucleus :159,956 ha

Plasma : 15,047 ha

Total Planted Area : 57,093 ha

Nucleus : 44,801 ha

Plasma : 12,292 ha

Overview of Our Group’s Activities

Total capacity : 66,000 MT

No of Vessels : 5

Total Capacity: 12,550 MT

No. of Kernel Crushing Plant : 2

Total Capacity : 435

MT/day

Products Processing Plantation

Total Production

2011 : 13,231 MT

1H2012 : 5,718 MT

Total Production

2011 : 27,641 MT

1H2012 : 12,906 MT

* Subject to final measurement

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Where We Are…

Oil palm estate

Oil palm estate with palm oil mill and kernel

crushing plant

Palm oil mill

Port and bulking terminal, Joint venture with Louis Dreyfus

Commodities

Biomass power plant

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Phase 1

Oil Palm cultivation started in 1996 in Bangka island, Sumatra (1,215 ha). This was followed by the 2nd planting in 1998 in South

Kalimantan.

Phase 2

Started in 2004 in south and east Kalimantan with rapid planting programme. Total planted hectarage increased by about 5 times

(from phase 1)

Phase 3

Started in 2011 in Sulawesi. Expect to double up the total planted ha by 2018.

* By 1H2012: Approximately 57,093 ha of oil palms planted

Development of Oil Palm Plantations

Phase 1 Phase 2

Planted Area : Nucleus + Plasma (Ha)

Year of Planting Plasma Nucleus

-

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

55,000

60,000

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 1H2012

Plasma

Nucleus

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Potential Double-Digit FFB Production Growth

AGE DISTRIBUTION OF OIL PALMS (NUCLEUS)

% o

f N

ucle

us

Pla

nte

d

AGE PROFILE OF OIL PALMS (Ha)

Immature % Young

Mature %

Prime

Mature % Total

Nucleus 21,138 47% 11,595 26% 12,068 27% 44,801

Plasma 3,590 29% 4,434 36% 4,268 35% 12,292

Total 24,728 43% 16,029 28% 16,336 29% 57,093

• RELATIVELY YOUNG PROFILE: 71% OF YOUNG AND IMMATURE PALMS

• POTENTIAL FOR STRONG DOUBLE-DIGIT PRODUCTION GROWTH OVER THE NEXT 5 YEARS

Weighted

Average

Age = 6.5

Years 0%

3%

6%

9%

12%

15%

18%

21%

17 16 15 14 13 12 11 10 9 8 7 6 5 4 3 2 1

Age (Years)

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FFB Production Trend (Nucleus)

• 2000 – 2011 CAGR = 28.3%

• 2012 onward – expect steady increase in production

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 1H 2012

MT

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Significant Land Bank for Future Planting

Total Land Bank 175,003 ha (including Plasma)

Land

Bank

(ha)

Planted

Area

(ha)

Planted

Area

(%)

Nucleus 159,956 44,801 28.0

Plasma 15,047 12,292 81.7

Total 175,003 57,093 32.6

14%

9%

10%

67% Immature

Young Mature

Prime Mature

Unplanted Area

Planted Area: 33%

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Production Volume

1H 2011 1H 2012 Change 2Q 2011 2Q 2012 Change

FFB (MT)

- Produced from Nucleus 160,761 178,902 +11.3% 84,349 97,899 +16.1%

- Purchased from Plasma 66,258 55,423 -16.3% 36,289 31,937 -12.0%

- Purchased from other

external parties 66,129 46,601 -29.5% 31,154 16,597 -46.7%

Crude Palm Oil (MT) 57,667 53,474 -7.3% 30,324 28,132 -7.2%

Crude Palm Kernel Oil (MT) 6,396 5,718 -10.6% 2,382 2,333 -2.1%

FFB Yield (MT/ha)-Nucleus 7.5 7.6 +1.3% 4.0 4.1 +2.5

CPO Extraction Rates 20.4 20.4 - 20.3 19.8 -2.5%

CPKO Extraction Rates 41.6 41.7 +0.2% 42.1 41.7 -1.0%

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Sales Volume and Revenue (CPO & CPKO)

1H 2011

1H 2012

% change

2Q 2011

2Q 2012

% change

Sales Volume (MT)

- CPO 126,212 122,501 -2.9% 86,283 49,600 -42.5%

- CPKO

4,666 5,272 +13.0% 2,473 1,572 -36.4%

Sales Revenue (USD’000)

- CPO 123,644 110,321 -10.8% 85,066 43,074 -49.4%

- CPKO 7,345 5,594 -23.8% 3,610 1,595 -55.8%

- OTHERS* 10,354 9,957 -3.8% 4,660 3,540 -24.0%

Average Sales Price (USD)

- CPO 980 901 -8.1% 986 868 -12.0%

- CPKO 1,574 1,061 -32.6% 1,460 1,015 -30.5%

*) Others include sales of Kernel, Cake, FFB, and income from logistic and power generation

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Financial Performance

USD’000 1H 2011 1H 2012 % Change 2Q 2011 2Q 2012 % Change

Revenue 141,343 125,872 -10.9% 93,336 48,209 -48.3%

Gross profit 21,662 16,144 -25.5% 10,494 6,723 -35.9%

Operating profit 16,416 5,607 -65.8% 8,124 1,543 -81.0%

Profit before tax 12,354 2,832 -77.1% 5,984 111 -98.1%

Net profit for the

period 9,135 2,890 -68.4% 4,491 739 -83.5%

EBITDA 18,946 8,142 -57.0% 9,369 2,948 -68.5%

Gross margin (%) 15.3 12.8 -2.5pp 11.2 13.9 +2.7pp

Net Profit margin (%) 6.5 2.3 -4.2pp 4.8 1.5 -3.3pp

EBITDA margin (%) 13.4 6.5 -6.9pp 10.0 6.1 -3.9pp

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Balance Sheet

USD’000 As at

31 Dec 2011

As at

30 June 2012 Change

Current Assets 97,695 82,849 -15.2%

Non-current Assets 380,728 395,373 +3.8%

Total Assets 478,423 478,222 0 %

Current Liabilities 64,901 73,084 +12,6%

Non-current Liabilities 185,730 187,903 +1.2%

Total Liabilities 250,631 260,987 +4.1%

Shareholders’ Equity 227,792 217,235 -4.6%

Net Debt/Equity Ratio (%) 55.2 70.1 +14.9pp

Net Debt/Total Assets (%) 26.3 31.9 +5.6pp

Debt/EBITDA (x) 6.5 9.8 +3.3pp

EBITDA/Interest Expense (x) 3.0 2.7 -0.3pp

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Cash Flows

n/m = not meaningful

USD’000 1H 2011 1H 2012 Change 2Q 2011 2Q 2012 Change

Cash at beginning of period 24,216 29,880

Net cash (used in)/from

operating activities 23,387 7,065

Net cash used in

investing activities (37,157) (24,989)

Net cash from

financing activities 15,483 12,421

Net effect of

exchange rate changes in

consolidating entities

(410) 1,142

Net increase/(decrease)

in cash 1,303 (4,361)

Cash at end of period 25,519 25,519

USD’000 1H 2011 1H 2012 Change

Cash at beginning of period 24,216 23,019 -4.9%

Net cash from operating activities 23,387 10,534 -55.0%

Net cash used in

investing activities (37,157) (30,542) +17.8%

Net cash from

financing activities 15,483 5,511 -64.4%

Net effect of

exchange rate changes in consolidating entities (410) (596) -45.4%

Net increase/(decrease)

in cash 1,303 (15,093) n/m

Cash at end of period 25,519 7,926 -68.9%

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Updates and Future Developments

Updates:

Planted area (including plasma) increased by

approximately 2,200 ha in 1H 2012

Construction of 4th palm oil mill with 45MT/hour

capacity in East Kalimantan has been completed

Acquired 2 additional vessels in 1H 2012

Future Developments:

To maintain new planting of around 8,000 ha

each year

To acquire more vessels in 2012/2013 to handle

greater trading volume with completion of new

port

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Thank You