Saratoga’s Reached a Record High Dividend Income of Rp 2.6 Trillion in 2022, With NAV Growing by 8% to Rp 60.9 Trillion
Jakarta, March 13, 2023 – PT Saratoga Investama Sedaya Tbk. (ticker code: SRTG), an active investment company, recorded a Net Asset Value (NAV) of IDR 60.9 trillion in 2022, an increase of approximately eight percent from IDR 56.3 trillion in 2021. The strong NAV growth, despite pressures from multiple economic factors over the past year, is proof of the solid investment strategy and the robust business fundamentals within Saratoga’s investment portfolio.
Saratoga President Director Michael William P. Soeryadjaya explained that in 2022, dividends earned from portfolio companies reached IDR 2.6 trillion. This achievement reflects an increase of 57 percent on a year-on-year basis and is the highest dividend income ever for Saratoga. PT Adaro Energy Indonesia Tbk. (ADRO) and PT Mitra Pinasthika Mustika Tbk. (MPMX) contributed the largest dividends last year.
“We would like to express our appreciation for the outstanding performance of our investment portfolios – such as ADRO, MDKA, TBIG, MPMX, as well as our other portfolios – for successfully optimizing available business opportunities and generating record dividend income for Saratoga. The positive NAV growth and dividend yield are also a testament to the capability of Saratoga’s human resources, as they were able to adapt the company’s investment strategy amidst an unfavorable economic climate and volatile capital market in 2022,” explained Michael William P. Soeryadjaya in an official statement in Jakarta on Monday (13/3).
Michael said that amid surging inflation and rising interest rates, both globally and domestically, Saratoga reduced its debt to IDR 1.6 trillion in 2022, down more than 60 percent compared to 2021. This also resulted in the company’s low net debt of IDR 688 billion. As a result of solid and prudent cashflow management, Saratoga is in a favorable position to participate in quality investment opportunities that are in line with the company’s investment DNA.
“Saratoga closed 2022 with solid capital reserves, giving the company ample room to execute its investment strategy. Our hope is that the growth of Saratoga’s investment portfolio will continue to contribute to economic development and create more jobs for Indonesia,” Michael said.
Saratoga Director of Investment Devin Wirawan stated that amid various economic pressures and increasing investment volatility across the globe, management has successfully maintained both the operating expense and debt position within the favorable limits in 2022. The ratio of operating expense to NAV was 0.4 percent, while the ratio of loan to NAV decreased significantly to 1.1 percent from 5.8 percent in 2021.
“The success of maintaining healthy cost and debt position indicates that proper investment planning, supported by efficient, prudent, and measured capital management, have enabled Saratoga to achieve solid performance in a highly challenging year. Saratoga’s well-rounded experience and ability to execute investment strategies during the COVID-19 pandemic in the past three years have also driven the company’s NAV to a record high in 2022,” Devin added.
SARATOGA’S 2022 INVESTMENT PORTFOLIO
- PT Adaro Energy Indonesia Tbk. (ticker code: ADRO)
In 2022, ADRO successfully recorded its all-time highest net profit of USD 2.49 billion, or around IDR 38 trillion. The 167 percent increase compared to 2021 was driven by increased sales volume and high average coal prices throughout 2022.
As a result of its brilliant performance, ADRO announced its largest interim dividend of USD 500 million for the 2022 financial year. This is an increase of 67 percent from the 2021 interim dividend of USD 300 million.
ADRO also successfully listed its non-coal thermal business unit, PT Adaro Minerals Indonesia Tbk. (ADMR) on the Indonesia Stock Exchange (IDX). ADMR is the operator of the metallurgical coal production and aluminum smelter projects. Metallurgical coal is a key component in the production of stainless steel, while aluminum is used in solar panels and electric vehicles, among others. Hence, playing an instrumental role in driving the green energy transition.
In November 2022, ADMR signed a memorandum of understanding (MoU) with Hyundai Motor Company (Hyundai) for the provision of a steady supply of aluminum. Both companies agreed to form a comprehensive partnership for the production and supply of aluminum with a potential volume of 50,000-100,000 metric tons per year for Hyundai.
- PT Merdeka Copper Gold Tbk. (ticker code: MDKA)
In 2022, MDKA acquired a world-class nickel mine and nickel smelter project, consolidated under the Merdeka Battery Materials (MBM) entity. Its assets include:
- Sulawesi Cahaya Mineral (SCM) Nickel Mine, one of the world’s largest undeveloped nickel resources. The Joint Ore Reserve Committee (JORC)’s total resources amount to over 1.1 billion dmt at 1.22 percent Ni, containing 13.8Mt of nickel, and at 0.08 percent Co, containing 1.0Mt of cobalt;
- Cahaya Smelter Indonesia (CSI) and Bukit Smelter Indonesia (BSI), two rotary kiln-electric furnace (RKEF) nickel smelters that are operational and cash-flow generating with a combined production capacity of 38 ktpa of nickel;
- Zhao Hui Nickel (ZHN), currently building an RKEF nickel smelter with an installed capacity of 50ktpa and aiming to start operation in July 2023;
- Acid Iron Metal (AIM), which will process pyrite ore from the Wetar Copper Mine and produce steam, sulfuric acid and iron, as well as gold and silver. Demand for sulfuric acid is expected to increase significantly, driven by the construction of additional high-pressure acid leach (HPAL) plants in Indonesia. AIM’s first production is expected to commence in the second half of 2023;
- Indonesia Konawe Industrial Park (IKIP), a joint venture with Tsingshan to develop a downstream nickel processing industrial zone within SCM’s area (IUP).
Last year, MDKA successfully issued 1.2 billion new shares, raising a total of USD 235 million in funds. Through this corporate action, Contemporary Amperex Technology Co., Ltd. (CATL) has become MDKA’s strategic partner with a five percent stake in the company. CATL is a global leader in the development and manufacturing of lithium-ion batteries and is listed on the Shenzhen Stock Exchange.
The partnership has created opportunities for joint investment in mineral resources for the battery metal value chain, such as nickel, cobalt, lithium, copper, manganese, and aluminum.
- PT Mitra Pinasthika Mustika Tbk. (ticker code: MPMX)
In May 2022, MPMX developed a strategic partnership with CARRO, the largest and fastest-growing used car market in Southeast Asia. CARRO invested IDR 784 billion through the acquisition of a 50 percent stake in MPMRent, one of MPMX’s business units.
CARRO is poised to bring technology and digitization capabilities (e.g., Big Data, AI, and relevant pricing algorithms) to create Indonesia’s only integrated online and offline automotive ecosystem. It will offer complete products and services, ranging from marketplace, leasing, and financing to insurance, serving both B2B and B2C markets.
The strategic partnership with CARRO continues to create new synergy and bring forth future initiatives, including:
- Integration of CARRO’s wholesale business into the MPMRent Auction, which is already taking place;
- Exploration of new initiatives: electric vehicle leasing and subscription models;
- Optimization of potential for collaboration opportunities in automotive insurance and financing products.
- PT Samator Indo Gas Tbk. (ticker code: AGII)
In December 2022, the company changed its name from Aneka Gas Industri to PT Samator Indo Gas Tbk. This strategy expects to bring Samator closer to the public and increase recognition of its products in the market.
In November 2022, AGII began construction of a new factory in the Batang Integrated Industrial Zone (KITB), Central Java, targeting commission in the next 18-24 months. This was done after the signing of a sale and purchase agreement with KCC Glass Corporation of South Korea. KCC is building a factory in KITB, which is projected to be one of the largest in Southeast Asia.
In August 2022, AGII started operations of its oxygen plant in Bangka Belitung for PT Timah Tbk. (TINS)’s tin refining smelter.
- PT Tower Bersama Infrastructure Tbk. (ticker code: TBIG)
TBIG successfully operated 21,700 telecommunication tower sites and served approximately 40,700 customers until the third quarter of 2022. This is promising growth compared to the end of 2021, where the number of tower sites owned by TBIG was 20,600 with a total of 39,100 customers.
In an effort to manage its financial flow in an efficient and disciplined manner, TBIG also successfully issued three rupiah-denominated bonds with a total value of IDR 5.4 trillion.
AtriaDC owns and operates Indonesia’s scalable, purpose-built in-town data center. AtriaDC also has land reserve assets that can accommodate a total designed capacity of up to 33 megawatt (MW).
AtriaDC provides flexibility and scalability for customer companies to connect with the global ecosystem and deliver world-class digital experience to their partners and end users. AtriaDC is strategically located near major Internet exchanges and end users, enabling low-latency connectivity that creates the best end-user experience.
- City Vision
In 2022, City Vision successfully launched Indonesia’s most prestigious LED network, the Iconic Bundaran HI (Hotel Indonesia) Digital Network. It is a new network of five digital displays adorning the facades and interiors of the luxurious Plaza Indonesia and the legendary Grand Hyatt Hotel.
Spanning 800 square meters, the iconic Bundaran HI Digital Network allows unlimited reach to the capital’s population of over 12 million. Tailor-made for brand leaders and renowned brands, the HI Roundabout Digital Network becomes the fourth large-scale digital display that City Vision has unveiled since 2019.
- Forest Carbon
Forest Carbon is a premium carbon project developer founded in 2012. The company was built to benefit local communities, biodiversity, and investors through a proven business model.
Forest Carbon’s mission is to create a globally significant climate and ecological impact through the protection of Indonesia’s rainforests and peatlands, which make up one-third of the world’s peatlands. The company specializes in the full cycle of carbon project development, from securing investment, designing and implementing projects, to securing carbon sales and running sustainable businesses.
Forest Carbon’s flagship project includes the Sumatra Merang peatland project, which is now a successful business model for peatland restoration. The sale of carbon credits from the project to major global companies has funded operations and increased forest coverage in the project area by 23 percent. The flagship project also protects endangered species, such as the Sumatran tiger, and supports the advancement of local communities through the provision of health, education, and employment opportunities.
Xurya has successfully completed additional Series A funding, bringing its total Series A funding round to USD 33 million. To strengthen the market, Xurya also developed strategic partnerships with Mitsui Co., Ltd. and PT Surya Semesta Internusa Tbk. (SSIA).
In 2022, Xurya won 1st place in the G20 Digital Innovation Network 2022 for the Green and Renewable Energy category, representing Indonesia among other G20 countries.
Throughout 2022, Xurya opened new branch offices in Medan, Surabaya, and Semarang. The company also completed 28 projects at several large companies, such as Bungasari Flour Mills (FKS Group), Quty Karunia (IKEA supplier), Arwana Citramulia Tbk., Unicharm Indonesia Tbk., Santika Banyuwangi and Palembang Hotels – as well as at the Java Integrated Industrial and Port Estate (JIIPE).
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.