Message From Chairman

Dear Shareholders,

Staying focused

These are extraordinary times, and I feel fortunate that we have an extraordinary team at Saratoga, not just in managing change and volatility during the past 12 months but in demonstrating their ability to capitalize on significant opportunities.

Financial performance

Given weaker sentiment, investment outflows and the depreciation of the Rupiah, the net asset value of the portfolio had declined from IDR22 trillion to IDR14 trillion, at the close of 2015. However, I am pleased to report positive news on the financial performance of Saratoga over the past 12 months.The company generated 48% earnings growth, captured value through the listing of our investee Merdeka Copper Gold and broadened the company’s sources of funds using an exchangeable bond. Two new investments in operating companies were agreed and implemented.

Active but prudent investing

Saratoga has adequate liquidity to ensure we are able to capture investment opportunities as they arise. We continue to monitor our levels of leverage and will consider selective divestments if the terms are sufficiently attractive. Just such a case has materialized post-reporting date, through the sale of our interest in the PT Pulau Seroja Jaya.

I have referred in the past to our track record as a long-term investor. From the origins of Saratoga we have established two imperatives, firstly, to be thorough in knowing our shareholder partners and their ability. And secondly the discipline and close attention we pay to the inherent risks involved in every business in which we invest. I hope that in reading this report a better appreciation of Saratoga and our philosophy comes through.

Saratoga closed the year with a well spread portfolio of investments in 22 companies, 11 of them listed. Our diversity and depth provides private shareholders with a unique portfolio proposition: to participate in the significant growth potential across the natural resources, infrastructure and consumer sectors over the medium term. Of equal importance, we provide opportunities via our investment network, to gain access to private companies in early stage and highly prospective businesses, where substantial value has yet to be realized.

Corporate Governance

During the year the Board of Commissioners met on five occasions and jointly three times with the Board of Directors to examine and review the company’s performance in accordance with the annual and medium term business plans and we are satisfied with their performance. The Board of Commissioners also reviewed the work of the Audit Committee and Nomination and Remuneration Committee and a full account of the work of the governance committees is included in this report.

There was one change to the Board of Directors, with Michael W.P. Soeryadjaya being appointed as the President Director as my long time business partner and fellow shareholder, Sandiaga Uno, takes up key duties in the public sector. I take this opportunity to thank Sandiaga for his considerable contribution, his leadership and wise counsel in building Saratoga to one of Indonesia’s most successful investment companies. Sandiaga has resigned from all active involvement in day-to-day management, while he will remain fully invested as a major shareholder.


One of our highest priorities as an active investor is people – both within Saratoga itself and our investee companies. It has been encouraging to see the extent of investment in capacity building and the development of leadership and skills across the group.

Saratoga’s annual CXO network was once again a valuable opportunity for investees to share ideas and build synergy among leaders within the group. And I am delighted to note the level and range of responsible community, social and environmental activities undertaken over the year.

Outlook for 2016

The Board of Commissioners remains cautious but positive about the future. Our confidence is founded on our knowledge of Indonesia’s natural strengths in the resources and consumer base, coupled with our extensive network. We believe this positions us as capable investment partners, providing strong financial and management support. Our sentiments are shared; the World Bank predicts a ‘new normal’ of lower global growth and has forecast above 6% GDP growth for this region – a respectable level of expansion by any measure. Indonesia at current asset values, with low private sector debt, easing credit conditions and massive domestic consumer markets – quite apart from the enviable resource base – offers as compelling a prospect as ever. Let Saratoga be your investment partner for 2016.

On behalf of the Board of Commissioners, I extend our thanks to the Board of Directors and convey our appreciation for the efforts made by the many who work diligently within our invested companies, to our own team at Saratoga for their hard work during a challenging year and to our shareholders and stakeholders. We look forward to the year ahead.