Record Dividend Income In 2023, Saratoga’s NAV Reaches IDR 48.9 Trillion

Jakarta, March 18, 2024
During 2023, PT Saratoga Investama Sedaya Tbk (Saratoga, ticker code: SRTG) successfully optimized the performance of its portfolio companies resulting in strong dividend and divestment outcomes, as reflected in Saratoga’s dividend and divestment cash flow at the end of the year which reached its highest level at IDR 3.9 trillion.

Saratoga Investment Director Devin Wirawan said that 2023 was an especially important period for Saratoga to carry out its strategy as an investment company. In addition to encouraging dividend increases amid dynamic market conditions, Saratoga successfully divested and monetized mature portfolios and generated maximum returns for the company.

“We are grateful that in 2023, Saratoga achieved a record high total dividend income from the
portfolio compan ies , thus making the company’s liquidity very strong. With these cash funds, we have ample capacity to undertake various investment strateg ies , both in 2023 and in the years to come,” said Devin through an official statement in Jakarta on Monday, March 18, 2024.

With the support of a strong balance sheet, Saratoga also carried out its investment strategy in 2023 by increasing its stake in PT MGM Bosco Logistik (MBL) to become the majority shareholder.

Devin stated that in 2023, Saratoga recorded a Net Asset Value (NAV) of IDR 48.9 trillion. The NAV decreased by 20 percent compared to 2022. “The commodity price volatility throughout 2023 has impacted the share prices of Saratoga’s main portfolio companie s, namely PT Adaro Energy Indonesia Tbk ticker code: ADRO) and PT Merdeka Copper Gold Tbk ticker code: MDKA). A s a result , the share price fluctuations impacted Saratoga’s NAV at the end of last year,” explained Devin.

According to Devin,
ADRO and MDKA’s strong business fundamentals will allow them to achieve sustainable and profitable growth. Moreover, the two entities are currently positioned in several strategic sectors, namely coal, gold, and nickel commodities as well as downstream businesses, which have a direct impact on global and domestic economies.

Saratoga Finance Director Lany D. Wong revealed that Saratoga successfully strengthened its internal liquidity in 2023. This was reflected in the reduction of debt position, which resulted in interest costs decreasing by 49 percent in 2023. This success is in line with the company’s efforts to manage capital prudently amid the ongoing high global interest rate environment.

“As of December 31, 2023, we have reduced Saratoga’s net debt by 62 percent to IDR 263 billion, compared to IDR 688 billion in the previous year. Moreover, we succeeded in maintaining a healthy level of cost and debt ratio s . Operating cost to NAV was stable at 0.5 percent and loan to value was 0.4 percent compared to 1.1 percent in 2022,” Lany explained.

Lany stated that this year, Saratoga would continue to be active in implementing its investment
strategies . This step is in line with Indonesia’s projected economic growth, which remains positive. The peaceful end of the general election process in February also provided good capital for business stakeholders to continue investing and developing their businesses.

“We will remain focused on increasing investment s in economic sectors that make major contributions to the Indonesian economy. One strategy is by strengthening investments in existing portfolios or adding new portfolios which have good business growth prospects in the long term,” Lany concluded.

Saratoga Portfolio Company Update

Listed Companies

1. PT Adaro Energy Indonesia Tbk ticker code: ADRO)

   In 2023, ADRO continued to have positive performance. It recorded a coal production volume of 65.9 million tons, growing five percent year on year (yoy) with sales volume up seven percent yoy to 65.7 million tons. The achievement was above the 2023 target of 62 64 million tons.

   ADRO posted revenue in 2023 of USD 6.5 billion, down 20 percent yoy with operating earnings before interest, taxes, depreciation, and amortization (EBITDA) reaching USD 2.6 billion, down 49 percent yoy. This was due to a 26 percent yoy decline in average coal sales price in 2023.

   Nevertheless, ADRO’s balance sheet remained at a healthy level with a net cash position of USD 1.9 billion in 2023.

   Throughout last year, ADRO successfully carried out several corporate actions, including the groundbreaking of the Mentarang Induk hydropower project in North Kalimantan in March 2023. The power plant will generate 1,375 megawatts (MW) of electricity with an estimated investment of USD 2.6 billion. It is operated under PT Kayan Hydropower Nusantara (KHN), which is owned by ADRO (50 percent), Sarawak Energy Berhad (25 percent), and PT Kayan Patria Pratama (25 percent).

   Furthermore, in May 2023, it obtained a loan of USD 1.6 billion and IDR 2.5 trillion for the construction of an aluminum smelter.

2. PT Merdeka Copper Gold Tbk ticker code: MDKA)

   In 2023, MDKA recorded an increase in gold production to 138, 666 ounces (oz), up 11 percent on an annual basis. While the average gold sales price also increased by eight percent yoy to USD 1,939/oz. Copper production fell 35 percent yoy to 12,7 06 ton s due to temporary delays in explosive shipments. Copper production has already shown recovery in the fourth quarter (Q4) of 2023.

   Meanwhile, nickel commodity in 2023 consisted of nickel matte production reaching 30,3 33 tons, while NPI production increased 68 percent yoy to 65, 1 1 7 tons as a result of the PT Zhao Hui Nickel ( ZHN smelter commissioning. The Sulawesi Cahaya Mineral (SCM) Mine will supply about half of the nickel ore demand from PT Merdeka Battery Materials Tbk (stock code: MBMA)’s smelter by 2024, thereby reducing the impact of fluctuations in global nickel prices.

   SCM Mine ore shipments jumped from 4 3 989 tons in the third quarter (Q3) of 2023 to 2.9 million tons in Q4 of 2023. SCM targets nickel ore sales of 15 million tons in 2024 (four million tons of saprolite and 11 million tons of limonite).

   In April 2023, one of MDKA’s subsidiaries, PT Merdeka Battery Materials Tbk. ticker code: MBMA successfully completed its Initial Public Offering (IPO) on the Indonesia Stock Exchange (IDX). Priced at IDR 795 per share, the IPO received staunch support from domestic and foreign investors, regional sovereign wealth funds, and strategic investors. The offering involved the issuance of 11.6 billion new shares, wit h a total new capital of IDR 9.2 trillion, equivalent to 10.7 percent of total outstanding shares.

   MBMA successfully executed a series of corporate actions:

   MBMA announced plans to develop a High Pressure Acid Leaching (HPAL) plant at Konawe Indonesia Industrial Estate in Sulawesi, Indonesia. The HPAL project will produce an equivalent of 120,000 tons of nickel per year, which will be divided into two phases. MBMA signed a Memorandum of Understanding (MoU) with Ningbo Brunp Contemporary Amperex Co. Ltd., an affiliate of Brunp CATL for the first phase.

   In June 2023, MBMA acquired a 60 percent stake (40 percent Tsingshan) in PT Huaneng Metal Industry (HNMI) for USD 75 million. It is a high grade nickel matte (HGNM) conversion facility located within the Indonesia Morowali Industrial Park (IMIP). HNMI processes low grade nickel matte (LGNM) into HGNM containing 70 percent nickel. The annual production capacity is 50,000 tons per year.

   In September 2023, MBMA signed a definitive agreement with GEM to build an HPAL plant with a capacity of 30,000 tons of nickel contained in mixed hydroxide precipitate (MHP) per

   The HPAL plant will be built in the Indonesia Morowali Industrial Park (IMIP) and operated under PT ESG New Energy Material a joint venture of MBMA and GEM with a commissioning target of late 2024 for stage 1 and mid 2025 for stage 2. The plant will also purchase and process nickel laterite ore from MBMA’s SCM Mine under a 20 year supply agreemen t.

3. PT Samator Indo Gas Tbk ticker code: AGII)

   In March 2023, CVC Capital Partners, through Matrix Company Limited, acquired a significant minority stake (32.3 percent) in AGII from existing shareholders for approximately USD 155 million. Leveraging CVC’s global network and experience, including its gl obal knowledge transfer and best practice sharing, will significantly benefit AGII.

   AGII held a groundbreaking ceremony for its new factory project at Batang Integrated Industrial Estate (KITB) in Central Java. The plant will be AGII’s 56th plant and is scheduled for commission in Q4 of 2024. AGII signed a sale and purchase agreement with KCC Glass Corporation from South Korea in November 2022. KCC is also building a plant at the KITB, which is projected to be one of the largest plants in Southeast Asia.

Non Listed Companies :

4. MGM Bosco Logistik (MBL)

   MBL is an end to end cold chain logistics service provider ranging from warehousing , transportation, to logistics solutions with more than 20 years of experience in the industry. MBL currently owns and manages four cold storage facilities with a total capacity of more than 35,000 pallet positions. The locations are spread across South Sumatra, West Java, East Java, and South Sulawesi.

   As one of the largest end to end cold chain logistics service providers in Indonesia, MBL operates nearly 1,000 refrigerated trucks equipped with thermo loggers and a GPS. The facility allows customers to monitor shipment status and product temperature.

   In line with Saratoga’s commitment to increase MBL’s business capacity, in 2023, Saratoga increased its shareholding in the company to become the majority shareholder.

5. Bersama Digital Infrastructure Asia (BDIA)

   As part of BDIA, Bersama Digital Data Centers (BDDC) was launched in 2023, which owns and operates carrier neutral data centers within the city in several strategically connected locations in the Jakarta area.

   BDDC has acquired two sites: PT Rumah Data Kita (South Jakarta), which is still under construction, and PT PCDC Propco One AtriaDC (West Jakarta), which is operational. BDDC has a total design capacity of up to 60MW and occupies a data room area exceeding 20,000 square meters, with the potential to accommodate more than 9,000 racks.

6. Xurya Daya Indonesia (Xurya)

   Xurya is a solar developer that is trusted by more than 100 companies to install and operate rooftop solar power plants on their buildings. The number of rooftop solar power plants in operation has reached 150 projects spread across 11 provinces in Indones ia. Xurya was recognized in the Forbes Asia “100 to Watch List”.

   Xurya has established a strategic partnership with PLN Icon Plus and PLN UID West Java. Together with PLN, Xurya will create a business collaboration plan for renewable energy utilization, provision of photovoltaic systems, energy management systems, carbo n management, and renewable energy certification.

   By 2023, Xurya successfully doubled its energy capacity with an estimated carbon offset of at least 54,000 tons of CO2 between January to December 2023.

   Throughout 2023, Xurya completed construction and operated 58 new projects at several locations, such as Trans Shopping Mall Group, Plaza Indonesia, PT Sariguna Primatirta (CLEO), PT Serena Indopangan Industri (Khong Guan Group), and Surabaya Islamic Hospital Jemursari.

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About PT Saratoga Investama Sedaya Tbk

Founded in 1997, PT Saratoga Investama Sedaya Tbk (Saratoga, ticker code: SRTG) is a leading active investment company in Indonesia. Saratoga plays an active role in managing investee companies and investing in innovative companies with high growth potential across Southeast Asia. The company has a strong track record of identifying, developing, and creating value from the companies in which we invest.

Our investment strategy has been refined to adapt to the changing times, evolving from our initial focus on natural resources, infrastructure, and consumer sectors to our participation in other new emerging sectors, including the rapidly expanding digital technology sector that has grown to become a major main driver of Indonesia’s sustainable economic growth.

Saratoga’s vision is to continue to be a leading world-class active investment company and the partner of choice for both local and foreign investors looking to participate in the dynamics of Indonesia’s economic growth.

For more information, please visit: www.saratoga-investama.com.

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Corporate Secretary	Investor Relations
corporate.secretary@saratoga-investama.com	investor.relations@saratoga-investama.com