1H17 MPM Company Highlights and Financial Results (Ticker: MPMX) - - PowerPoint PPT Presentation

1H17

MPM Company Highlights and Financial Results (Ticker: MPMX) August 2017

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MPM: FROM “PIPELINE” TO “PLATFORM” BUSINESS

OUR CREDO Progressive Thinking Active Ownership Collaboration OUR VISION

To positively impact lives through smart mobility and social integration

OUR MISSION To create ecosystems of the best ideas (game changing innovation) delivered through the most relevant products and services (understanding people better) in the most effective ways (optimized business models & cross selling), by the most talented people (high performance culture) in our industry

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TABLE OF CONTENT

01 MPM: Company Highlights 02 Consolidated Financial Results: 1H 17 Updates 03 Business Segment Performance

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MPM IN A SNAPSHOT: LEADING SMART MOBILITY COMPANY IN INDONESIA

• Est. in 1987 by W. Soeryadjaya as

2W distribution business for Honda

• Expertise and leading market

positions in consumer automotive (2W & 4W) supply chain and value chain

• Recognized by industry as 2016

Top 50 Best Company in Indonesia (Forbes) and other various awards

Market expertise With 30 year of experience

• BOC & BOD has over 100 years of

management and governance with industry experts, independent commissioners, and professionals in place

• Listed in IDX (Ticker: MPMX) in

2013, raising Rp 1.5T from public (22% enlarged TSO)

• Total Equity @ Rp 5.1T with cash

balance @ Rp 1.3T (June ’17)*

Strong Corporate Governance & Financials

• 4 main business segments, each with

growth potential

• Network and presence across

archipelago serving 10MM+ individual customers, 1,000+ corporate clients, and 10,000+ 3rd party channels

• 8,000+ employees with high

performance culture

Significant Growth Potentials

Resource: MPMX, as of 30 June 2017 *Figures are post MPMF deconsolidation

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MPM BUSINESS: COLLECTIVE POWER

Rp 17.7T

FY16 Revenue

77% 10% 6% 7%

Distribution & Retail

• 2W Honda distribution in E. Java + NTT

with 290 dealer relationships, serving ~4.2MM active customers

• 2W Honda 3S dealerships with 40
• utlets across Indonesia
• 4W Nissan & Datsun 3S dealerships

with 5 outlets across Indonesia

Consumer Parts

• 2W & 4W engine lubricant principal &

parts distribution company

• 3,300+ Federal Oil Centers & 10,000+ 3rd

party workshops nationwide, serving 10MM+ customers per year

Auto Services

• Independent 4W rental/lease company

with 13K+ fleet, serving 1,000+ corporates

• Fleet & logistic management services

Financial Services

• Independent 2W, 4W, lease financing

business with 87 outlets nationwide, serving 135K+ customers

• Non-life general insurance including

2W, 4W, cargo, & property with 22

• ffices & 6 service points nationwide

Resource: MPMX, as of 30 Jun 2017

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GOVERNANCE AND MANAGEMENT

48.6% 15.3% 6.8% 29.3%

PT Saratoga Investama Sedaya Tbk Morninglight Investment S.a.r.l Claris Investment Pte. Ltd. Public & Others

Board of Commissioners

Strong mix of operational, strategy, M&A, and governance expertise

Board of Directors

Over 100 years of combined professional experience Rudy Halim

Group CEO

Troy Parwata

Group CFO

Agung Kusumo

Managing Director

Titien Supeno

HR Director

Andi Esfandiari

Director

Edwin Soeryadjaya

Chairman

Tossin Himawan

Commissioner

Danny Walla

Commissioner

Lee Chul Joo

Commissioner

Istama Siddharta

Independent Commissioner

Simon Halim

Independent Commissioner

Shareholding

Resource: MPMX, as of 30 Jun 2017

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MPM GROUP NETWORK: PRESENCE ACROSS INDONESIA

Resource: MPMX, as of 30 Jun 2017

22 MPMInsurance Offices & Outlets 47 FKT Distributors for Federal Oil & Federal Mobil 30 MPMRent Offices & Service Points 5 MPMAuto Dealers 87 MPMFinance Offices & Outlets 40 MPMotor Retail Outlets 290 MPMulia Dealers

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TABLE OF CONTENT

01 MPM: Company Highlights 02 Consolidated Financial Results: 1H17 Updates 03 Business Segment Performance

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1H17 REVENUES: SEGMENT CONTRIBUTION & MOVEMENT

Revenues 1H17 Rp 7.7T

9.9% QoQ, -7.7% YoY

80% 11% 8% 1%

• 10%
• 4%

+19% +38%

• 7.7%

(777) (40) 106 24 46 %YoY 1H16 1H17 7,708 8,349

YoY revenue growth

Distribution & Retail Consumer Parts Auto Services *Financial Services Elimination

Revenues Growth % YOY, in Rp billion

Summary

 Total Revenue was impacted by shorter working period during Lebaran holidays.  Sales from 2W distribution was affected by slow harvest condition in East Java while consumer cautious spending affected Consumer Parts sales.  Higher revenue in Auto Services was driven by stable rental business and higher disposal value of used cars.  Financial Services continues to deliver strong performance.

* Includes MPMInsurance only

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%YOY

• 17%
• 14%

+114% +51% +79% (18) (21) 13 10 38 180 1H16 1H17 323 141 +9,950% +136%

YoY NPATMI growth

1H17 NPATMI: SEGMENT CONTRIBUTION & MOVEMENT

*8% 10% 41% 41%

0% 10% 20% 30% 40% 50%

Financial Services Auto Services Consumer Parts Distribution & Retail

Rp 323B 50.6% QoQ, 79.5% YoY

NPATMI 1H17

Distribution & Retail Consumer Parts Auto Services **Financial Services Discontinued Operation Head Office

NPATMI Growth % YOY, in Rp billion

Summary

 NPATMI strong growth is driven by overall improvement of operational efficiency and one-off gain of MPMFinance divestment.  Higher operational efficiency contributed to the significant increase of profitability in Auto Services.  Improved asset quality and strong business growth drove the solid profitability in Financial Services.  The profitability in Distribution & Retail and Consumer Parts were impacted by the lower sales.

• 226%

(20) Minority Interest

*Includes Discontinued Operation (MPMFinance) 7% and MPMInsurance 1% ** Includes MPMInsurance only

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1H17 Financial Highlights

Summary

 Gross margin, EBITDA margin and Net margin all increased compared to the same period last year.  CAPEX spending continues to come down, in line with the key focus of 2017.  Strong balance sheet with healthy Net Debt/Equity ratio.  ROE, ROA and FCCR ratio have improved significantly.

* Annualized figure

Net Debt/EBITDA* Net Debt/Equity ROE* ROA* FCCR 1H17 1.2x 0.3x 11.0% 5.8% 4.3x 1H16 4.5x 1.0x 6.7% 2.5% 3.5x

Key Ratios P&L Highlights

Net Revenues Gross Profit NPATMI EBITDA CAPEX 1H17 7,708 893 323 779 253 QoQ% 9.9% 9.6% 50.6% 12.6% 7.0% YoY%

• 7.7%
• 4.4%

79.5% 28.5%

• 42.5%

%Rev N/A 11.6% 4.2% 10.1% 3.3%

(In Rp Billion)

Cash and Cash Equiv. Total Asset Bank Funding Bonds BV of Equity 1H17 1,314 9,751 324 2,679 5,097 QoQ% 61.8%

• 34.1%
• 92.0%

1.8%

• 12.5%

YoY%

• 24.4%
• 35.7%
• 92.3%

1.6%

• 9.0%

B/S Highlights

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MPMFinance Divestment and Deconsolidation Impact

* Annualized figure

Without MPMF Divestment (Estimated) 1H17 Income statement (in Rp T) Revenue EBITDA NPAT NPATMI 1H17 Balance sheet (in Rp T) Assets Liabilities Equity Net Debt Key ratios EBITDA margin NPAT margin ROA* ROE* Net Debt to Equity Net Debt to EBITDA* After MPMF Divestment (Actual) 1H17 Income statement (in Rp T) Revenue EBITDA NPAT NPATMI 7.7 0.78 0.35 0.32 1H17 Balance sheet (in Rp T) Assets Liabilities Equity Net Debt 9.8 4.7 5.1 1.7 Key ratios EBITDA margin NPAT margin ROA* ROE* Net Debt to Equity Net Debt to EBITDA* 10.1% 4.5% 5.8% 11.0% 0.3x 1.2x

MPMF Deconsolidation Impact

8.3 0.68 0.25 0.21 15.4 9.5 5.9 6.7 8.2% 3.0% 3.2% 8.5% 1.1x 4.9x

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KEY FOCUS 2017: (1) COST LEADERSHIP

Financial Highlights (in Rp billion) Summary

 Major OPEX items: C&B, A&P, T&S, have decreased YoY in line with the key focus of 2017.  Provision was driven by MPMRent as a result of the introduction of prudent accounting management.  Continue monitoring Revenue per headcount as part of the key focus of 2017. Revenue / HC Total Opex

• Compensation & Benefit
• Advertising & Promotion
• Transportation & Storage
• Provision

Average CoF 1H17 2.5 536 217 99 39 12 10.1% QoQ% 13.0% 9.4%

• 3.7%

7.4% 20.4% 85.0% YoY%

• 4.6%
• 4.4%
• 2.0%
• 21.7%
• 12.1%

56.1% %Rev

• 7.0%

2.8% 1.3% 0.5% 0.2%

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KEY FOCUS 2017: (2) OPERATING CASH FLOW

AR Days AP Days Inventory Days 1H17 18.3 22.5 17.6 YoY% 2.6%

• 20.7%
• 14.7%

Operational Highlights Summary

 Keep up the momentum of producing positive cash flow.  CF from Investing grow significantly due to the proceeds from MPMF divestment.  CF from Financing decreased significantly due to the effect of centralized treasury center.  Continue to monitor Cash Conversion Cycle.

1H17 Cash Flow (in Rp billion)

1H16 17.8 28.4 20.6

Balance as of

December 31st

Operating Activities Investing Activities Financing Activities Balance as of

June 30th

* Net off with the Beginning balance of Disc. Operation.

• Beg. Balance of Disc. Op.
• Adj. Beg. Balance*

CF from Operating CF from Investing CF from Financing Ending Balance 1H17 (83) 1,202 243 407 (538) 1,314 YoY%

• 22.6%

252.2%

• 206.4%
• 24.4%

1H17 1H16

1,869 314 (268) (176) 1,739 1,202 243 407 (538) 1,314

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KEY FOCUS 2017: (3) COLLABORATIVE ECONOMY & NEW GROWTH

Collaborative Economy- ACE Performance

 Improving cross-selling and up-selling between

• perating companies, aligned with the Accelerated

Collaborative Economy initiatives.

New Growth-MPM Planet-The Power of Network Effects

 Rally Point App is the “window” to our MPM planet.  Stretch Dollar is key to the value proposition of MPM planet.  New business models and concepts to be launched in 2H17.

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2Q17 KEY EVENTS

FKT was recognized by the HR Asia Award as HR Asia Best Companies to work for in Asia 2017

Apr’17

MPMInsurance awarded 1st for Best General Insurance Award for companies with Rp 150-250 billion equity by Media Asuransi

May ’17

FKT received Superbrands 2017 award for category Automotive Lubricants

Jun’17 Jun’17

MPMulia launched All New Honda Scoopy in Surabaya

Jun’17

MPM is ranked 32nd in Most Valuable Indonesian Brands 2017 with a US$ 181 mio Brand Value & A Brand Rating from SWA Magazine MPM Group named Top 5 Best at Investor Relations by FinanceAsia

Jul’17 Jul’17

MPMFinance rank 2nd for Best Multifinance Company for category Asset under 5T by Infobank

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TABLE OF CONTENT

01 MPM: Company Highlights 02 Consolidated Financial Results: 1H 17 Updates 03 Business Segment Performance

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1H16 1H17

Sales Volume (Unit in thousands, YoY%) 902 912 863

FY15 FY16 TTM

• 5%

Revenue (in Billions of Rupiah, YoY%) +1% 261 338 330

FY15 FY16 TTM

+30% Mulia 129 132 131

FY15 FY16 TTM +2%

MSO

FY15 FY16 TTM

14,459 13,961 +7% 13,544

• 0%
• 3%
• 2%

NPAT (in Billions of Rupiah, YoY%) 1H17 Highlights

• Lower sales volume was driven by slow harvest, increase in

vehicle registrations and earlier Lebaran break.

• NPAT fell marginally in line with lower revenue for the period

Key Initiatives

• Launch of 6 new models and revamped 11 models during 2017.
• Increase in promotional activities to consumer, dealers and

financing companies.

• Built the third warehouse to lower rental costs and optimize

distribution.

2W DISTRIBUTION & RETAIL :

CONTINUE LEADERSHIP IN E. JAVA AND NTT

1H16 1H17 1H16 1H17 1H16 1H17

455 406 63 63 6,673 7,172

• 11%
• 1%
• 7%
• 5%

149 157 Mulia + MSO Mulia + MSO

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• 85
• 102
• 96

4W DEALERSHIP :

IMPROVE SALES PRODUCTIVITY & SERVICE LEVEL

Sales Volume (Units, YoY%) 1H17 Highlights

• Intense competition in the 4W market and the decline in

market attractiveness of Nissan and Datsun brand from lack of new products contributed to the fall in sales.

• Number of dealerships is also lower as compared to last

year due to scaling down of operations. Key Initiatives

• Focus on operational efficiency and sales productivity as

well as after-sales service quality to the customers.

FY15 FY16 TTM

• 43%

+29%

• 19%

260

• 10%

9,823

NPAT (in Billions of Rupiah, YoY%) Revenue (in Billions of Rupiah, YoY%)

FY15 FY16 TTM FY15 FY16 TTM

773 502 +20% 643

• 35%

1H16 1H17 1H16 1H17

480

• 48
• 32

1H16 1H17

3,078 1,023 209

• 67%
• 57%
• 22%

3,680 4,755 2,700 48

• 16*
• 16*

*One-off loss from sale of fixed asset.

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1H16 1H17

• 6%

CONSUMER PARTS:

STRENGTHEN CHANNEL & NEW PRODUCT DEVELOPMENT

• Shorter working days in June impacted the sales volume.
• Gross margin remain stable though revenue was slightly lower.
• NPAT was lower due to the lower revenue and less finance

income. Key Initiatives

• Federal Oil (2W)
• Strengthen channel development
• Increase product quality
• Federal Mobil (4W)
• Focus on market growth outside of Jakarta and Surabaya
• Improve B2B channels

Sales Volume (Units in thousand litres, YoY%)

FY15 FY16 TTM

+7%

260 9,823

NPAT (in Billions of Rupiah, YoY%) Revenue (in Billions of Rupiah, YoY%)

• 3%

FY15 FY16 TTM

1,675 1,629 1,582

• 3%

59,200 63,341 61,297

• 7%

1H17 Highlights

1H16 1H17

• 6%

30,002

• 10%

48 253 +6% 32,046 845 799 272 254

TTM FY16 FY15 1H16 1H17

• 12%

153 135

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+103% 1 15

• 33

1H17 Highlights

AUTO SERVICES:

MAINTAIN OPERATIONAL EXCELLENCE & CASH FLOW

• Higher revenue was driven by stable rental business and higher

disposal value of used cars.

• Higher NPAT driven by OPEX efficiencies and finance cost

saving. Key Initiatives

• Continuous improvement on operational efficiency and

productivity of the fleet.

• Improve the portfolio of corporate clients, including new offerings

to customers. Fleet Size (Units, YoY%)

FY15 FY16 TTM

+1%

260

NPAT (in Billions of Rupiah, YoY%) Revenue (in Billions of Rupiah, YoY%)

• 6%

FY15 FY16 TTM

1,091 1,197 1,123

• 3%

+10% 13,935 14,137 13,327 +1,318%

1H16 1H17

• 6%

1H16 1H17

+19% 547 12 25

1H16 1H17 +114%

14,334 13,524

TTM FY16 FY15

653

22

31 41 51

FY15 FY16 TTM FY15 FY16 TTM

385 393 259 41 42 1H17 Highlights

MPMINSURANCE:

INCREASE PENETRATION GROUP & NON-GROUP BUSINESSES

Gross Premium (in Billions of Rupiah, YoY%) +49% 31

9,823

NPAT (in Billions of Rupiah, YoY%) +2% +32% +24%

204 212

1H16 1H17

20 30

1H16 1H17

+51% +4%

• Gross premium grew steadily driven by increase in new

policies especially for the MV segment.

• NPAT increased in 1H17 primarily due to higher

underwriting and investment income. Key Initiatives

• Increase market penetration in MPM Group business as

well as non-affiliated businesses.

• Plans to increase network penetration via opening up new

branches (Pontianak and Lampung).

• Working together closely with strategic brokers both online

and offline to grow portfolio and acquire new clients.

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1H17 Highlights 1,185 1,226 1,164 +2% +3%

MPMFINANCE:

SELECTIVE GROWTH WHILE MAINTAINING FOCUS ON ASSET QUALITY

• Asset quality improved YoY basis as reflected by NPL level.
• New Booking growth was driven by new 4W financing through

strengthening relationship with various dealers.

• Increased NPAT was due to higher gross profit and improved

asset quality. New Booking (in Billions of Rupiah, YoY%)

FY15 FY16 TTM +37%

9,823

NPAT (in Billions of Rupiah, YoY%) Revenue (in Billions of Rupiah, YoY%)

+18%

2,934 4,015 4,728 Key Initiatives

• Continuously monitor and manage asset quality by implementing

early warning system across network.

• Diversify and optimize source of funding to ensure competitive

pricing.

1H16 1H17

+40% 2,522

1H16 1H17

588 82 128 27 +198% +56% 2 48

1H16 1H17

+2,313%

1,808 +8% 547

TTM FY16 FY15 TTM FY16 FY15

3.3% 3.2% 3.2% 2.7% 2.3% 2.60% Mar'16 Jun'16 Sep'16 Dec'16 Mar'17 Jun'17

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DISCLAIMER

• These materials have been prepared by PT Mitra Pinasthika Mustika Tbk (the

“Company”, “MPM”) and have not been independently verified. No representation or warranty, expressed or implied, is made and no reliance should be placed on the accuracy, fairness or completeness of the information presented or contained in these materials. The Company or any of its affiliates, advisers or representatives accepts no liability whatsoever for any loss howsoever arising from any information presented or contained in these materials. The information presented or contained in these materials is subject to change without notice and its accuracy is not guaranteed.

• These materials may contain statements that constitute forward-looking
• statements. These statements include descriptions regarding the intent, belief or

current expectations of the Company or its officers with respect to the consolidated results of operations and financial condition of the Company. These statements can be recognized by the use of words such as “expects,” “plan,” “will,” “estimates,” “projects,” “intends,” or words of similar meaning. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ from those in the forward-looking statements as a result of various factors and assumptions. The Company has no obligation and does not undertake to revise forward-looking statements to reflect future events or circumstances.

• These materials are for information purposes only and do not constitute or form part
• f an offer, solicitation or invitation of any offer to buy or subscribe for any securities
• f the Company, in any jurisdiction, nor should it or any part of it form the basis of, or

be relied upon in any connection with, any contract, commitment or investment decision whatsoever. Any decision to purchase or subscribe for any securities of the Company should be made after seeking appropriate professional advice.

Thank You