Analyst Briefing2Q13 performance results

14 Aug 2013

2

The views expressed here contain information derived from publicly available sources that have not been independentlyverified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. Anyforward looking information in this presentation has been prepared on the basis of a number of assumptions which mayprove to be incorrect. This presentation should not be relied upon as a recommendation or forecast by PT. IndoTambangraya Megah Tbk. Nothing in this release should be construed as either an offer to buy or sell or a solicitation ofan offer to buy or sell shares in any jurisdiction

3

AppendicesFinancial reviewCommercial reviewOperational reviewIntroduction

34

21

2Q12 3Q12 4Q12 1Q13 2Q13 3Q13E

4

Highlights of 2Q13 and 1H13 results

Units: Mt

Up 0.1 Mt+1% Q-Q

Up 0.4 Mt +6% y-y

7.5

Indominco

Trubaindo

Kitadin

Jorong

Bharinto

QUARTERLY OUTPUTFINANCIAL SUMMARY

Coal sales6.9 Mt

Down 0.2 Mt -3% Q-Q

Coal sales14.0 MtUp 1.6 Mt

+13% y-y

6.87.0

8.0

7.1 7.2

Total Revenue

GPM

EBIT

Net Income

ASP* (USD/ton)

1Q13

563

23%

85

72

$80.0

y-y

-9%

-12%

-52%

-50%

-20%

1H12

1,204

34%

321

247

$97.7

2Q13

527

21%

70

52

$76.8

Q-Q

-6%

-2%

-18%

-28%

-4%

1H13

1,090

22%

155

123

$78.4

• Increase sales to 29.0 Mt from 27.2 Mt

• Market development

• Leverage high CV competitiveness

• Consider to secure long-term price for off-spec products both internally and with third party blending

• Strengthen product and shipment reliability

Overview of current strategic initiatives

• Lower SR to decrease production costs

• Infrastructure improvement and logistics efficiency

• Control overhead costs

• Further operating cost reduction through IPCC, fuel substitution study etc.

• Continuous improvement on organization structure to support good corporate governance

• Enhance risk management best practices

• Rules and regulation compliance in all mine sites

• Banpu Spirit as ITM people character

• Strong balance sheet

• Prudent cash management

• Maintain dividend payout policy

COST FOCUSREVENUE FOCUS

BEST PRACTICEFINANCIAL POLICIES

2013 TARGETS MID-YEAR REVIEW FOCUS FOR 2H13

RE

VE

NU

E

Revenue Focus

• Increase sales to 29.0 Mt from 27.2 Mt

• Achieved 14.0 MT sales for 1H13 • On track to meet the full year target

• Market development • Trial shipment of Bharinto coal to non-Japan market

• Bharinto coal shipment to premium price market

• Consider to secure long-term price for off-spec products both internally and with third party blending

• Establishment of ITM trading company

• Look out for business opportunities

• Strengthen product and shipmentreliability

• Bidding and winner selection for 1st

stage of BoCT expansion• Awarding and starting of

construction

CO

ST

Cost Focus

• Lower SR to decrease production cost

• Reduced SR by 11% HoH• Lower S/R at Indominco and

Trubaindo by 7% HoH and 19% HoH, respectively

• Plan to lower costs further through improved productivity

• Infrastructure improvement and logistics efficiency

• Facilities sharing between Trubaindo and Bharinto sites

• Road hauling improvement• Reduce fuel consumption on tug

boats and renegotiate barging contract

• Further operating cost reduction through IPCC, fuel substitution study etc.

• Installation of IPCC equipment at Indominco site

• IPCC expected to start around 4Q13• Trial of alternative/other supplier

for explosive and fuel oil• Coal recovery improvement at

Bharinto site

Progress review

2013 TARGETS MID-YEAR REVIEW FOCUS FOR 2H13

PO

LIC

IES

Financial Policies

• Strong balance sheet • Large cash balance with zero debt position

• Maintain zero debt position

• Prudent cash management • Positive cash flow for ITM • Maintain positive cash flow for ITM

• Maintain dividend payout policy • Strong dividend payout for 2H12 performance

• Maintain dividend payout policy

BE

ST

PR

AC

TIC

E

Best Practice

• Continuous improvement on organization structure to support good corporate governance

• Software application to align allstandard operating procedures across business function with company’s key performance indicator

• Continue aligning with other business functions across the company

• Improve budgeting process

• Enhance risk management best practices

• Establishment of Compliance and Risk Management Department in the Organization Structure

• Strengthen Enterprise Risk Management (ERM)

• Rules and regulation compliancein all mine sites

• Establishment of compliance checklist for all mine sites

• Effective compliance monitoring

• Banpu Spirit as ITM people • Banpu Spirit Retreat • Enhance Banpu Spirit in practice

Progress review – cont’d

8

AppendicesFinancial reviewCommercial reviewOperational reviewIntroduction

34

21

9

2Q13 production achieved lower than target due to bad weather affecting the production performance.

IPCC trial stage: installation of crushing equipment already 60% progress. Waiting to start for erection of conveying and stacking system. Project expected to commence by 4Q13.

Port expansion: Under process of awarding bidding winner.

QUARTERLY UPDATES

Indominco MandiriSCHEMATIC

EAST BLOCK

Santan RiverPort stock

yard

Bontang City

Asphalt haul road

2.5Km

35Km

Sea conveyor

Mine stockyard

Inland conveyor 4km

0 106 82 km4

WEST BLOCK

Operations

Stockpile

Ports

Hauling

Crusher

ROM stockpile

Post Panamax

95,000DWT

2013 target: 14.8mt

E B

LOC

KW

BLO

CK

E B

LOC

KW

BLO

CK

2.1 2.0 2.5 2.4 2.5 2.7

1.4 1.82.0

1.1 1.1 1.13.5 3.8

4.5

3.5 3.6 3.8Units: Mt

Units: Bcm/t

2Q12 3Q12 4Q12 1Q13 2Q13 3Q13e

15.2

11.6

13.2

9.2

13.9

9.0

19.1

9.3

QUARTERLY OUTPUT

19.1

9.3

Avg.SR: 13.0 11.1 10.2 12.4 12.0

2Q12 3Q12 4Q12 1Q13 2Q13 3Q13e

19.1

9.3

12.3

10

Trubaindo: 2Q13 production achieved higher than target due to adequate raw coal stock and better hauling performance.Bunyut port expansion: Continue with EPC bidding process and waiting for EPC contractors to submit the bidding proposal.

Bharinto: 2Q13 production achieved higher than target due to improvement in hauling capacity.

QUARTERLY UPDATES

Trubaindo and BharintoSCHEMATIC

QUARTERLY OUTPUT

Mahakam River

South Block 1(Dayak Besar)

North Block

40kmMine to port

KedangpahuRiver

ROM stockpile

BunyutPort

0 10 2515 205 km

Product coal conveyor, stacking,

stockpile

EAST KALIMANTAN

Bharinto 60km south west of

Trubaindo North Block

South Block 2(Biangan)

PT. BHARINTO

PT. TRUBAINDO

Operations

Stockpile

Hauling

Barge Port

2013 Target: TCM : 7.7mt BEK : 1.9mt

2.0 2.0 2.1 2.0 2.0 2.0

2.0 2.02.4 2.3

2.6 2.6

TRUBAINDO13.5

TRUBAINDO

BHARINTO

13.4

Units: Mt

Units: Bcm/t

12.7

BHARINTO 7.4 7.8

0.6

10.9

7.6

0.6

10.9

7.5

2Q12 3Q12 4Q12 1Q13 2Q13 3Q13e

2Q12 3Q12 4Q12 1Q13 2Q13 3Q13e

10.9

7.5

11

Kitadin Embalut:

2Q13 production is according to target.

Kitadin Tandung Mayang:

2Q13 production was lower than target due to change of mining plan.

QUARTERLY UPDATES

Kitadin Embalut and Tandung MayangSCHEMATIC

QUARTERLY OUTPUT

0.3 0.3 0.3 0.2 0.3 0.3

0.7 0.6 0.4 0.8 0.5 0.5

1.0 0.9 0.71.0

0.8 0.8

Balikpapan

MahakamRiver Samarinda to Muara Berau

Bontang city

EMBALUT

Embalut Port

to Muara Jawa

ROM stockpile

Operations

Stockpile

Ports

Hauling

Crusher0 106 82 km4

5km Mine to port

TD. MAYANG

EAST KALIMANTAN

IMM EBIMM WB

BontangPort

TDM : 2.4mt

11.8

TDM

EM

BE

MB

TDM 15.1

11.4

15.1

Units: Mt

Units: Bcm/t

6.0

15.1

11.5

15.1

2013 Target: EMB : 1.0mt

10.9

15.1

2Q12 3Q12 4Q12 1Q13 2Q13 3Q13e

2Q12 3Q12 4Q12 1Q13 2Q13 3Q13e

11.6

15.1

Coal terminal

Jorong

Pelaihari

Pacific Ocean

Haul road

0 10 2515 205 km

20km

Operations

Stockpile

Hauling

Barge Port

FY13 target: 1.2mt

MAJOR QUARTERLY UPDATES

12

Jorong

• 2Q13 production as according to target.

• Construction of river diversion project is nearly finished and expected to be completed within 3rd Qtr 2013.

SCHEMATIC

QUARTERLY OUTPUT

8.68.68.6 8.6 8.6 8.6

Units: Mt

Units: Bcm/t

2Q12 3Q12 4Q12 1Q13 2Q13 3Q13e

0.3 0.3 0.3 0.3 0.3 0.3

2Q12 3Q12 4Q12 1Q13 2Q13 3Q13e

13

AppendicesFinancial reviewCommercial reviewOperational reviewIntroduction

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21

14

SUPPLYOVERALL VIEW DEMAND

● Expect to see better conditions starting 2014

● New demand continues to soak up supply excess

● Cutbacks gradually capped supply increase

● The share of poorer grade coals in total exports continues to grow

● Any sharp change, would encourage an upward spike, as the ability of producers to add near term capacity reduces as market weakness continues.

● If US increase to 3.5 - 4.0% GDP growth by mid-2014, it would have positive impact and bring positive flow on to other economies especially coastal manufacturing in China.

● Chinese stimulation, if of any substance by end-2013, would compound any upward lift

View on seaborne thermal coal market

15

Seaborne thermal coal market drivers: 2Q update OTHER DEMAND DRIVERSCHINESE DEMAND ASIA PACIFIC DEMAND

● Despite high summer demand, oversupply to continue through 2013

● Political constraints add uncertainty, albeit no caps yet

● Limited new demand while past investment leads to excess supply

● World still growing; positive GDP ● Thermal coal demand still on course

to be up almost 40 Mt YoY

● India has up-paced import with a likelihood to show 30 Mt YoYincrease

OTHER SUPPLY DRIVERSWEATHER INDONESIA AND AUSTRALIA

● All effects negative for coal● Good hydro. Good renewables● No major supply disruptions

● USA ceases to be big factor ● Though mines cut back, new supply

from past investments came online. Biggest cutbacks are in China

● Supply interruptions in regions like Colombia, South Africa, Russia are only short-term

● Indonesia still feeling a squeeze; many producers are not achieving sales plans

● Depreciation of Australian dollar insulates Australian coal output from weak spot coal prices. South Africa and Columbia similar

16

ITM ASPs vs thermal coal benchmark pricesITM ASP VS BENCHMARK PRICES

* Barlow Jonker Index: benchmark NSW FOB thermal coal index

ASP 2Q13 $76.8

ASP 2Q12 $94.6

NEX* Aug 01, 2013 $77.1

Unit: $/t

COMMENTS

• ASP declined marginally in 2Q, reflecting the general market weakness

• Despite healthy demand, continuing pressure from the well-supplied market impacts ASP

• July JPU benchmark was agreed at $89.95/t , down from April JPU benchmark of $95.00/t

• Concluded sales of 6.9 Mt in 2Q at ASP of $76.8/t, down 4% QoQ0

20

40

60

80

100

120

140

160

180

200

Jan-

07A

pr-0

7Ju

l-07

Oct

-07

Jan-

08A

pr-0

8Ju

l-08

Oct

-08

Jan-

09A

pr-0

9Ju

l-09

Oct

-09

Jan-

10A

pr-1

0Ju

l-10

Oct

-10

Jan-

11A

pr-1

1Ju

l-11

Oct

-11

Jan-

12A

pr-1

2Ju

l-12

Oct

-12

Jan-

13A

pr-1

3Ju

l-13

Monthly NEX

Quarterly Banpu Indonesia ASP

Monthly NEX

ITM quarterly ASP

17

China thermal coal market review

CHINA DOMESTIC COAL PRICES

Source: www.sxcoal.com/cn 30 June 2013

Unit: RMB/t

630585510

400

500

600

700

800

900

1,000

Feb-

11

May

-11

Aug

-11

Nov

-11

Feb-

12

May

-12

Aug

-12

Nov

-12

Feb-

13

May

-13

> 5,800 kcal/kg

> 5,500 kcal/kg

> 5,000 kcal/kg

93

103

147

147 5 4

2010 2011 2012 2013E

Import Export

ANNUALIZED ACTUAL IMPORT 3Q11 - 4Q12 & 2Q13

CHINA THERMAL COAL IMPORTS/EXPORTS

Sources: China Coal Report Jan 2013, Banpu MS&L Estimates

Unit: Mt Unit: Mt

Net import142 Mt

c.145-155?

143

116

151 146

175

148140

4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13

Import Export

Net importc.141-

151 Mt ?

84%

11%5%

18

Indicative coal sales 2013COAL SALES CONTRACT AND PRICING STAUTS

Contract Status Price Status

Fixed

Index

Unsold

TARGET SALES 2013: 29.0 Mt

95%

5%

Contracted

Uncontracted

COAL SALES 1H13

19

ITM coal sales 1H13COAL SALES BREAKDOWN BY DESTINATION

JAPAN2.4 Mt

PHILIPPINES 1.0 Mt

THAILAND1.0 Mt

INDIA1.5 Mt

HK0.2 Mt

S KOREA1.2 MtCHINA

3.7 Mt

TAIWAN0.5 Mt

ITALY0.3 Mt

1.5

INDONESIA1.4 Mt

MALAYSIA0.4 Mt

26%

17%

11%10%

9%

7%

7%

4%3%

2%2%

Total Coal Sales: 14.0 Mt

Japan

China

Taiwan

S Korea

Italy

Thailand

Philippines

Hong Kong

IndiaIndonesia

Malaysia

2%

USA

USA0.3 Mt

OTHERS 0.1 Mt

COAL SALES 2013e

20

ITM coal sales 2013eCOAL SALES BREAKDOWN BY DESTINATION

JAPAN4.9 Mt

PHILIPPINES 1.9 Mt

THAILAND1.8 Mt

INDIA3.3 Mt

HK0.3 Mt

S KOREA1.8 MtCHINA

7.4 Mt

TAIWAN1.4 Mt

ITALY0.8 Mt

1.5

INDONESIA3.2 Mt

MALAYSIA0.9 Mt

26%

17%

12%

11%

7%

6%

6%

5%3%

3%2%

Total Coal Sales: 29.0 Mt

Japan

ChinaTaiwan

S Korea

Italy

Thailand

Philippines

Hong Kong

IndiaIndonesia

Malaysia

2%

USA

USA0.5 Mt

OTHERS 0.7 Mt

Others

21

AppendicesFinancial reviewCommercial reviewOperational reviewIntroduction

34

21

22

SALES VOLUME

Sales revenueREVENUE* GROWTH

ASP

2Q12 3Q12 4Q12 1Q13 2Q13

Units: US$M

Indominco

Trubaindo

JorongKitadin

Bharinto

2Q12 3Q12 4Q12 1Q13 2Q13

Units: Mt

Indominco

Trubaindo

JorongKitadinBharinto

Units: US$/t

2Q12 3Q12 4Q12 1Q13 1Q13* excluding port revenue

622

572

653

94.687.5 80.6

6.6 6.6

8.2

-19% YoY-4% QoQ

+4% YoY-3% QoQ-16% YoY

-6% QoQ

559

7.1

80.0

523

6.9

76.8

23

Average gross margin

Revenue

GPM* (%)

Units: US$M

Indominco Trubaindo Kitadin Jorong

39%

28%

Bharinto

19%1Q13

0

ITM Consolidated

2Q13

527

21%

2Q12 2Q12

626

31%

434

20%

2Q12

218

30%

2Q12

95

41%

2Q12

23

26%

2Q12

340

15%

179

18%

66

24%7

46

26%

2Q13 2Q13 2Q13 2Q132Q13

* COGS included royalty

354

17%

200

17%

1Q13

73

1Q13

28%

24

17%

34

31%

1Q13 1Q13 1Q13

563

23%

(0.5%)

24

Cash cost

2Q12 3Q12 4Q12 1Q13 2Q13

Units: US$/t

* Cash production cost + royalty + SG&A2Q12 3Q12 4Q12 1Q13 2Q13

Units: US$/Ltr

2Q12 3Q12 4Q12 1Q13 2Q13

Units: Bcm/t

2Q12 3Q12 4Q12 1Q13 2Q13

Units: US$/t

WEIGHTED AVERAGE STRIP RATIO CASH PRODUCTION COST

TOTAL CASH COST *FUEL PRICE

13.1

1.07

51.6

70.01.02

12.0 49.8

67.2

10.8

1.03

47.7

65.0

11.7

1.04

46.3

62.7

Avg.2011: 11.9Avg.2012: 12.2

Avg.2011: $46.4/tAvg.2012: $50.1/t

Avg.2011: $66.0/tAvg.2012: $68.0/t

Avg.2011: $1.02/ltrAvg.2012: $1.04/ltr

11.6 46.9

0.9763.1

25

EBITDACONSOLIDATED

*COGS = Prod cost + Transport cost + Inv. movement

Units: US$M

Revenue1Q132Q12 2Q13

98.9

COGS SellingRoyalty Admin

86.5

167.9

MINE BY MINE

Units: US$M

78.6

49.239.8

17.8 18.4

45.3

19.1 13.2

(0.8)0.49.3

Indominco Trubaindo2Q12

Kitadin Jorong1Q13 2Q13

Bharinto

4.2 2.39.7

2Q12 1Q13 2Q13 2Q12 1Q13 2Q13 2Q12 1Q13 2Q132Q12 1Q13 2Q13

+17.5

(35.8)

+3.7 +4.1 (1.9)

-48% YoY-12% QoQ

Lower sales volume by 3%and ASP by 4%

51.0

59.0

33.133.8

12.3 12.51.0

28.4

10.7 8.5

(1.8)

39.2

0.15.3 6.3

(0.3)

26

Net incomeCONSOLIDATED

122.2

51.571.9

Units: US$M

MINE BY MINE

Units: US$M

1Q13 2Q13OthersEBIT IncomeTax

DerivativeTransactions

Net Fin.Charges

2Q12

Indominco Trubaindo Kitadin JorongBharinto2Q12 1Q13 2Q13 2Q12 1Q13 2Q13 2Q12 1Q13 2Q13 2Q12 1Q13 2Q132Q12 1Q13 2Q13

(14.6) (0.8)

+0.9

-58% YoY-28% QoQ

Lower sales volume by 3% and ASP by 4%

+0.4

(6.3)

27

CASH POSITION

Net Gearing (%)

Net D/E (times)

(0.47)

(44%)

(0.57)

(57%)

(0.41)

(41%)

2009 20112010 2012

(0.46)

(46%)

Balance sheetKEY RATIOS

DEBT POSITION

Units: US$M

2009

429

2011

612

295

2010 2012

461

Units: US$M

55

2009

0

2011

0

2010

0

2012 2Q13

0

2Q13

400

2Q13

(0.42)

(42%)

28

2013 capital expenditure plan

Note: Total capex plan including Jakarta office

Units: USD million

Indominco

Trubaindo

Bharinto

Kitadin

Jorong

ITM Consolidated

22

Realized up to Jun’13

2013 Capex plan

70

64

6

150

2

6

31

2

1

4

1

29

Appendices

ITM structure

30

ITMG

65.00%

Indominco Trubaindo Jorong

PT Indominco Mandiri

(CCOW Gen.I)

PT Trubaindo Coal Mining

(CCOW Gen II)

PT Kitadin-Embalut

(KP)

PT Jorong Barutama Greston

(CCOW Gen II)

50.00%

PT Indo TambangrayaMegah Tbk.

Banpu Minerals (Singapore) Pte Ltd

99.99% 99.99% 99.99% 99.99%

Banpu Minerals Co.Ltd

Reserves 376* Mt

Resources 1,595* Mt

BMS

99.99%

BMC

Banpu PCLBanpu

Public35.00%

Kitadin

PT Kitadin-Td.Mayang

(KP)

BCI50.00%

100.00%Banpu Coal Investment

Co.Ltd

East Kalimantan East Kalimantan South KalimantanEast Kalimantan

INDONESIAN STOCK EXCHANGEIPO 18th Dec 2007

6,500-7,300 kcal/kg6,000-6,300 kcal/kg 5,800 kcal/kg 6,700 kcal/kg 5,300 kcal/kg

Output 1H13 : 7.1 Mt Output 1H13 : 3.9 Mt Output 1H13 : 1.8 Mt Output 1H13 : 0.6 Mt

Bharinto

PT Bharinto Ekatama

(CCOW Gen III)

99.00%

East / Central Kalimantan

6,400-6,800 kcal/kg

Output 1H13 : 0.9 Mt

East Kalimantan

152 Mt

679 MtResources

Reserves90 Mt

318 MtResources

Reserves12 Mt

149 MtResources

Reserves112 Mt

298 MtResources

Reserves4 Mt

142 MtResources

Reserves

6 Mt10 Mt

Resources

Reserves

Note: * Updated Coal Resources and Reserves as of 30 Jun 2013

ITMI

PT ITM Indonesia

Coal Trading

99.99%

Jakarta Office

31

Income statement

Unit: US$ thousand 2Q13 1Q13 QoQ%

Net Sales 526,911 562,67 5 -6%Gross Profit 111,644 128,422 -13%GPM 21% 23%SG&A (41,496) (43,67 1) EBIT 7 0,148 84,7 51 -17 %EBIT Margin 13% 15%EBIT DA 86,450 98,860 -13%EBIT DA Margin 16% 18%Net Interest Income / (Expenses) 2,515 2,07 0 Derivative Gain / (Loss) 2,040 2,846 Others (921) 4,660 Profit Before T ax 7 3,019 94,327 -23%Income Tax (21,487 ) (22,429) Net Incom e 51,532 7 1,898 -28%Net Incom e Margin 10% 13%

32

Income statement

Unit: US$ thousand 1H13 1H12 YoY%

Net Sales 1,089,586 1,204,358 -10%Gross Profit 240,066 406,195 -41%GPM 22% 34%SG&A (85,167 ) (84,922) EBIT 154,899 321,27 3 -52%EBIT Margin 14% 27 %EBIT DA 185,310 351,7 18 -47 %EBIT DA Margin 17 % 29%Net Interest Income / (Expenses) 4,585 4,688 FX Gain / (Loss) (7 63) (8,327 ) Derivativ e Gain / (Loss) 4,886 21 ,950 Others 3,7 39 (10,081) Profit Before T ax 167 ,346 329,503 -49%Income Tax (43,916) (82,7 62) Net Incom e 123,430 246,7 41 -50%Net Incom e Margin 11% 20%

COMMENTS

33

Operating costs

● Able to lower operating costs by 11% HoH

● Average strip ratio of 11.6x in 2Q13 down from 13.1x in 2Q12.

● ITM will continue to reduce average strip ratios in 2013 to cope with lower coal price trend

● Continue to focus on cost reductions including implementation of cost reduction program such as IPCC, renegotiate barging contract, fuel substitute, etc.

● IPCC will lower usage of diesel truck and shovel and use more electricity from owned power plant

2Q13 AVERAGE OPERATING COSTS

0

10

20

30

40

50

60

70

80

Mining and contractor cost

* Coal transportations, repair and maintenance, salaries and allowance, etc.

$74 $72$69

$65

$/t

$67

Other production costs*

Dep. & AmortisationSG&A expenses

Royalty

1Q 2Q 3Q 4Q Full year 1Q

$70

Full year2012 2012 2013 2013E

$63$65

2Q