ANNUAL REPORT - deltadunia.com · acquiring PT Bukit Makmur Mandiri Utama (BUMA) > BUMA is the...
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Delta Dunia MakMur annual rePOrt 2009 a
ANNUAL REPORT
Delta Dunia MakMur annual rePOrt 2009b
Company Profile 04Financial Highlights 08Operational Performance 10Message from the President Commissioner 12Business Strategy 16Message from the President Director 20Operating review 26Financial review 38Corporate Governance 40Financial Statement 49
cONTENTS
Delta Dunia MakMur annual rePOrt 2009 1
2009: towards a leading integrated coal mining platform in Indonesia
> DeltaDuniahassuccessfullyenteredthecoalsectorbyacquiringPTBukitMakmurMandiriUtama(BUMA)
> BUMAisthesecondlargestcoalcontractor,withaportfoliooflongtermcontractsworthoverUS$5billionwithleadingmines
>Significantcoalsectorgrowthprospects• Rapidlyexpandingexportmarkets–China,afirsttime
netimporterin2009• Governmentcoal-basedprogramtoboostthenational
powergrid
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cOMPANY PROFILE
Institutions & Public
Northstar Tambang Persada
Pte Ltd
60%
40%
+
Delta
An investment holding company focused on capturing value and realizing growth potential in the coal mining sector
Delta – the holding companyPTDeltaDuniaMakmurTbk(Delta)isalistedinvestmentholdingcompany.TheshareholdersofDeltaarecomprisedofNorthstarTambangPersadaPte.Ltd.,aSingaporevehiclecontrolledbyNorthstarEquityPartnersIILtd.,witha40%shareholding,andpublicandinstitutionalinvestorsowningtheremaining60%.
Deltawasestablishedin1991andinitiallyengagedinavarietyofbusinessesincludingrealestatedevelopment,textilemanufacturingandexporting.ItsshareshavebeenlistedontheIndonesiaStockExchange(IDX)sinceJune2001.InNovember2009followingashiftofinvestmentstrategy,Deltaacquired100%ofthesharesofPTBukitMakmurMandiriUtama(BUMA).
ThemanagementofDeltahasstatedthatitwillconcentrateoncapturingvalueacrossthecoalminingchainbyevaluatingpotentialstrategicacquisitionsinthecontractor,miningandsales&marketingareas.Additionally,theteamwilllooktodivestthelegacypropertyassetsstartingin2010.
PT Bukit Makmur Mandiri Utama (BUMA)Establishedin1998,BUMAiscurrentlythesecondlargestminingcontractorinIndonesia’scoalsector,providingopen-cutminingandoperationservicestocoalminingconcessionowners.
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BUMA
VisionTo lead in total mining services through long term preferred partnerships
MissionTo provide trusted total mining services through competent people, high quality engineering, efficient processes, a Safety, Health and Environment (SHE) culture and community development
BUMAmanagesaportfoliooflong-termoperatingagreementswithsomeofIndonesia’slargestcoalproducers,suchasPTBerauCoal,PTAdaroIndonesia,PTKidecoJayaAgungandcertainsubsidiariesofPTBayanResources.Miningcontractsrangeforperiodsfromthreetotenyears.BUMAhasareputationforreliability,efficiencyandalongstandingtrackrecordofcustomerretention.
BUMAhasover8,000employeesandoperatesapproximately3,200unitsofheavyequipmentusedincoalminingandlogistics,includingbulldozers,excavators,graders,cranes,drillingmachines,primemoversanddumptrucks.
OperationsaremainlylocatedinEastandSouthKalimantan,thelocationofthemajorityofIndonesiancoalreserves.Inthepastfiveyears,BUMA’soverburdenremovalandcoalproductiongrewbycompoundedannualgrowthratesof25.2%and13.6%,respectively.
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MALAYSIA
SINGAPORE
VIETNAM
PHILIPPINES
AUSTRALIA
TIMOR LESTE
THAILAND
INDONESIAJava
Sumatra
Sulawesi
Papua
Kalimantan
Pontianak
Banjarmasin
Palangkaraya
Balikpapan
Samarinda
LATI
BINUNGAN
SUARAN
PIK
LANNABBE
BAYAN
KIDEcO
MGM
ADARO
ARUTMIN
coal mining contracts:
Bayan - Gunungbayan Pratamacoal Period:2007 - 2013
Marunda Graha Mineral (MGM) Period:2003 - 2012
KidecoPeriod:2004 - 2019
Adaro Period:2009 - 2013
Arutmin Period:2008 - 2011
coal mining contracts:
Berau - Lati Period:1998 - 2018
Berau - Binungan Period:2003 - 2018
Berau - Suaran Port Period:2003 -2018
Bayan - Perkasa InakakertaPeriod:2007 - 2012
Lanna Harita Indonesia Period:2001 - 2013
Bukit Baiduri Energi (BBE) - Merandai Period:2001 - 2010
MAP OF OPERATIONS
Kalimantan
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Acquisition Overview• August2009–PTDeltaDuniaMakmur
Tbk.(Delta)signsaCSPAwithJohanLensaandPTBukitMakmurWidyatopurchase100%sharesofPT.BukitMakmurMandiriUtama(BUMA)
• 29October2009–BUMAexecutesloandocumentationwithaSyndicatedBankGroupforUS$285million
• 2November2009–BUMAissuesaUS$315millionHighYieldBondthroughitswhollyownedSingaporesubsidiary,PrimeDigPteLtd.
• 6November2009- Deltaacquires100%sharesofBUMA(minusoneshareasperregulations)
- NorthstarTambangPersadaPteLtd(NTP)acquires40%ofDeltashares
- PublicplacementofDeltasharestointernationalinstitutionalinvestors.Asaresult60%ofDelta’ssharesheldbypublic.
- Followingthecompletionoftheacquisition,BUMAistheprincipaloperatingsubsidiaryofDelta,accountingforpracticallyallofitsoperatingrevenues,netincomeandtotalassets.
• 11November2009–DeltaEGMS:shareholdersapprovedthefollowingappointments:- Mr.ErryFirmansyahasPresidentCommissionerofDelta
- Mr.PatrickWalujoasCommissionerofDelta
- Mr.ThomasHustedasDirectorofDelta• 21December2009–DeltaEGMS:
shareholdersapprovedthefollowingappointments:- Mr.HagiantoKumalaasPresidentDirectorofDelta
- Mrs.ArianiVidyaSofjanasDirectorofDelta
ntP 1 PuBliC / inStitutiOnS
Shareholding Structure
Delta
BuMa
leGaCy PrOPerty aSSetS 3
40% 60%
100% 2
1 Northstar Tambang persada Pte Ltd (Singapore) 2 Less one share as required by Indonesian regulations3 Three small property subsidiaries (PT Margamas Griya Royalty - 99.99%, PT Nusa Makmur cipta Sentosa - 99.99%
and PT Sanur Hasta Mitra - 90%)
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FINANcIAL HIGHLIGHTS
DELTA DUNIA
Income StatementinRpbn 20081) 2009* Gross Amount2) 2009* Net Amount3)
Netrevenue 10 6,351 1,129
Costofrevenues 0 4,860 813
Grossprofit 10 1,491 316
Operatingexpenses 5 255 100
Operatingprofit 5 1,236 216
EBITDA 6 2,096 1,076
Othercharges-net -13 -614 -322
Income(loss)beforeincometaxexpense -9 622 -106
Taxexpenses 1 270 55
Profitbeforepre-acquisitionincome -10 352 -160
Pre-acquisitionincome 0 512 0
Profitbeforeminority
interests
-10 -160 -160
Minorityinterests 0 0 0
Netprofit -10 -160 -160
Recurringprofit4) -2 106 13
Balance SheetInRpbn 20081) 2009*
Cash 1 543
STinvestments 148 43
Accountsreceivable 1 1,719
Othercurrentassets 149 660
Undevelopedland 119 128
Fixedassets–net 2 3,176
Othernon-currentassets 9 301
Total Assets 429 6,571
Accountspayable 0 360
LTdebt–current 50 328
Othercurrentliabilities 9 276
LTdebt 0 5,326
Othernon-currentliabilities 9 81
Total Liabilities 68 6,370
Minority interests 8 8
Total Equity 353 193
Financial Ratio (Gross Method)
2009*
Grossmargin 23.5%
Operatingmargin 19.5%
EBITDAmargin 33.0%
Pretaxmargin 9.8%
Netmargin -2.5%
Recurringnetmargin 1.7%
*BUMAwasconsolidated/acquiredinNovember20091)AsRestated2)Grossamountincludes12-monthBUMA’sresultsand
pre-acquisitionresultsareeliminatedatthenetprofitline.
3)Netamountreflects2-monthsofBUMAresults,fromrevenuetonetprofit
4)Excludingnon-recurringitems.
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BUMA
Income StatementInRpbn 2008 2009 YoY
Netrevenue 6,765 6,350 -6.1%
Netrevenueexcludingfuel 4,748 5,182 9.1%
Costofrevenues 5,352 4,851 -9.4%
Grossprofit 1,413 1,498 6.1%
Operatingexpenses 219 246 12.2%
Operatingprofit 1,194 1,253 4.9%
EBITDA 1,968 2,103 6.9%
Othercharges-net -847 -344 -59.5%
Incomebeforeincometaxexpense 347 909 162.3%
Taxexpenses 118 277 134.9%
Netprofit 229 632 176.4%
Recurringprofit1) 627 653 4.1%
Balance SheetInRpbn 2008 2009 YoY
Cash 429 492 14.7%
Accountsreceivable 1,662 1,718 3.4%
Othercurrentassets 952 601 36.9%
Receivables-relatedparty 24 2,466 10291.6%
Fixedassets–net 3,120 3,039 2.6%
Othernon-currentassets 180 290 61.7%
Total Assets 6,366 8,607 35.2%
Accountspayable 508 360 -29.2%
STdebt 810 328 -59.5%
Othercurrentliabilities 159 266 67.1%
LTdebt 3,197 5,326 66.6%
Othernon-currentliabilities 73 78 6.5%
Total Liabilities 4,748 6,358 33.9%
Total Equity 1,617 2,249 39.1%
Financial Ratio2)
2008 2009
Grossmargin 29.8% 28.9%
Operatingmargin 25.1% 24.2%
EBITDAmargin 41.5% 40.6%
Pretaxmargin 7.3% 17.5%
Netmargin 4.8% 12.2%
Recurringnetmargin 13.2% 12.6%
1)excludingnon-recurringitems2)excludingfuel
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coal Production mmtons
2008 2009
3633
-9.9%
coal Haulage mmtons
2008 2009
1215
27.5%
Overburden Removal mmbcm
2008 2009
262278
6.0%
Monthly Strip Ratio(overburden:coal)14.0
12.0
10.0
8.0
6.0
4.0
2.0
0.0
7.7x8.6x 8.2x
9.0x 8.8x9.2x
8.4x8.9x 8.9x
8.0x8.3x
7.9x
J 09 F M A M J J A S O N D
mm:millionbcm:bankcubicmeterofrock
OPERATIONAL PERFORMANcE
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2001 2002 2003 2004 2005 2006 2007 2008 2009
6.79.7
11.3
17.3
23.5
32.3 32.736.4
32.8
Historical coal Production mmtons
Historical Overburden Removal mmbcm
2001 2002 2003 2004 2005 2006 2007 2008 2009
50.9 56.6 61.5
90.3
139.7
190.7
207.0
262.1 277.7
Historical Implied Strip Ratio
2001 2002 2003 2004 2005 2006 2007 2008 2009
12.0
9.0
6.0
3.0
0.0
7.6x
5.8x 5.4x 5.2x5.9x
6.3x5.9x
7.2x
8.5x
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MESSAGE FROM THE PRESIDENT cOMMISSIONER
Erry Firmansyah PresidentCommissioner
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Dear Shareholder,
The results and work in progress towards a bright future IampleasedtowelcomeyoutothefirstannualreportofPTDeltaDuniaMakmurTbk,duringaparticularlyinterestingphaseforthecompanyanditsstakeholders.
During2009,Deltaunderwentachangeinownershipandatookonacompletelynewfocus-theexcitinganddynamiccoalminingsector.Tosucceedwiththenewfocusasaninvestmentholdingcompanypursuinggrowthandvalue,Deltaanditsmanagementhaverespondedrapidlytoopportunitiesemerginginthesector.Inlightofthis,thefinancialcondition,asreportedattheendof2009,shouldbeseenasatransitionalstageaheadofwhatwebelievewillbeasignificantandpositivestepchangeinthescopeofoperationsandearningspotentialinthenextfewyears.
Theresultin2009fortherecord,wasalossofRp160billion,duetofinancingcostsassociatedwiththeprincipalsubsidiary,PTBukitMakmurMandiriUtama(BUMA)andaprovisiontakenagainstthelegacypropertyportfolio.Intheinterestsoftransparentreporting,additionaldetailonthefinancialperfomanceofthesubsidiaryis
presentedonpage9oftheannualreporttofullyreflecttheunderlyingperformanceandconditionofthecoalcontractingbusiness.
Investment view Turningbacktothepastyear,commoditiesprovedtobeastrongthemein2009,representingaboutonethirdoftheJakartaCompositeIndexbymarketcapitalization.Coalwasparticularlyfavored,basedonstrongfundamentalsasannualindustryproductionreachedanewhighof254milliontonnes,up5.8percent,alevelconsiderablyabovepreviousGovernmentestimatesofaround230milliontonnes.Theofficialforecastfor2010callsfortenpercenthigheroutputat280milliontonnes,withover70percentofproductiondestinedforexportmarketsinadditiontoanexpectedriseindemandasnewGovernmentpowergenerationprojectscomeonline.
Comparedwithitsmaincompetitors,AustraliaandSouthAfrica,Indonesia’sthermalcoalexportscontinuetobenefitfromseveralfactors,notleastoneofthelowestcashminingcostsintheAsiaPacificregion:afunctionofopencutminingtechniquesandextensivereserves.ProximitytoChina,IndiaandotherkeyAsianimporters,isasecondfactor.
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Localmarketprospectsforthecoalindustrylookbright.Indonesia’sGovernmentpolicycallsforreducedrelianceonoilbasedpowergenerationandanincreasingroleformorecosteffectivecoalintheenergymix,risingfromabout11percentin2007to33percentby2025.Theincreaseistobedrivenbycoal-firedelectricitygenerationwithover40newplantsplannedbyPTPerusahaanListrikNegaraPersero(PLN).
Bidshavebeensoughtforafurther70smallcoal-firedgeneratingstationstoaddresssupplyneedsoutsideJavaandnationalelectricityconsumptionisestimatedtohaverisenover40percentinthefiveyearsto2008.Fortheimmediatefuture,PLNhasindicatedcoal-firedelectricalpowergenerationcapacitywillriseto18.0GWby2010(from10.4GWbackin2007)whichwouldliftdomesticcoalconsumptiontoabout54milliontonnesby2010,anincreaseof75percentfromabout31milliontonnesin2007.
Expansionofotherhighcoalusageindustries,includingcementandpaperwillalsoboostdemand.Undertheseconditionsweviewthefutureprospectsforyourcompanyasextremelyfavorable.
GovernanceFollowingthechangeofownership,theBoardofCommissionerswasconsiderablystrengthenedwiththeadditionoffournewmembersinthefinalquarteroftheyear.ItakethisopportunitytothankSiswanto,whoservedin2008asPresidentCommissionerandfromwhomIhavesucceeded.IampleasedtonotehehasagreedtocontinuetoserveasanIndependentCommissioneralongwithBennyWirawansa,asCommissioner.WeappreciatetheeffortsofStevenCahyadiwhosteppeddownfromtheBoardofCommissioners,andwelcomethreenewmembers,PatrickWalujoasVicePresidentCommissioner,NurdinZainalasIndependentCommissionerandIldaHarmynasCommissioner.
AnumberofappointmentsweremadetotheBoardofDirectors,andIwelcomeHagiantoKumalaasPresidentDirector,ThomasHustedasFinanceDirectorandArianiSofjanasDirectorandHeadofInvestorRelations.
ItisourviewthattheBoardofDirectorsofBUMA,havemanagedtheoperationsofthesubsidiarysatisfactorilyandthattherearenomajormattersoutstandingtoreport.Wenoteasoundperformanceintermsofoperationsandinparticular,thecontinuationofanoutstandingsafetyrecordatthesubsidiarycompany.
Inclosingwetakethisopportunitytothankallouremployeesfortheireffortsduringaperiodofchange,ourbusinesspartnersandourcustomers,andnotleastourshareholdersforcontinuingtheirsupportandforsharingourlongtermvisionofDeltaasaleadingintegratedcoalminingplatform,capturingvalueacrosstheentirecoalminingchain.
ForandonbehalfoftheBoardofCommissioners
Erry Firmansyah President commissioner
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BUSINESS STRATEGY
coal sector fundamentals
Deltaviewsthecoalsectorashavingsignificantandsustainedpotential.Asalowcostandreliablesourceofenergy,coalwillcontinuetobeindemandinAsiaforthelongterm.Indonesia’sresourcebaseassuresitspositionaskeyexporterofthermalcoal,enjoyingsubstantialrevenuesfromexportsintoregionalgrowtheconomies,notleastChinaandIndia.Domestically,theGovernmentofIndonesiahasplacedcoalatthecenterofextensiveinfrastructureprogramsforboostingelectricitysupply.
Post acquisition: 4 strategic themes
TheacquisitionofcoalcontractorBUMAtowardstheendof2009haspositionedDeltaasthesecondlargestoperatorinasectorwhichhandlesapproximately90percentofthecoalindustry’sannualproduction.BUMAhasbuiltasignificantmarketshareandofferssoundgrowthprospectsbaseduponanexcellentportfoliooflongtermcontractsthatgeneratestable,highqualityrevenuestreams.LeadingmineconcessioncustomersincludePTBerauCoal,PTAdaroIndonesia,PTKidecoJayaAgung,BayanResourcesGroup,PTArutminIndonesiaandLannaResources.BUMAhasarespectedmanagementteamwithaprofessionaltrackrecordthatcombinesstrongcustomerloyaltyandhighcontractrenewalrates,withequipmentsupplierrelationshipsthatyieldcostsavingsandattractivetermstosupportfutureexpansion.Inthefirstfewmonthsofassumingmajoritycontrol,wehaveintroducedfurthercoalindustryandfinancialexpertiseattheDeltaBoardleveltosustainourexpansionplans,superviseorganicgrowthandaddvalue.
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Wewillconcentrateonfourthemes:
• Maintainareputationasareliable,costeffectivecontractor
• Strongemphasisoncostmanagementandsavingstoimproveoperatingmargins
• Boostbusinessandcapacityexpansionplanstomeetrisingdemandforcontractmining
• Capitaliseonopportunitiestotakeoverunderperformingcontractsand/orreplacecontractors
Thusfar,ataformativestageinthelifeofthecompanywehavebeenabletosecuresatisfactoryunderlyingannualgrowthof9percentinnetrevenues(excludingfuelcosts)atthesubsidiarylevel,basedonoverburdengrowthof6percentrepresentingacontributionofover82percentofgrossrevenue.Theresultsfor2009takeintoaccountanumberofnon-recurringcostsassociatedwithfinancingandthestrategicshiftinbusinessdirectionofDeltaitself,underthenewownershipstructure.Theyearahead,2010,willpresentthechancetoengageourplansandgrowthprogramsoverafullcalendar.
Vertical expansion and integration strategies
DeltaseekstobeanactiveconsolidatorintheIndonesiancoalsector.Themanagementteamhasidentifiedafewopportunitiestoselectivelyexpandalongthecoalsectorvaluechain.Wearefocusedoncapturingvaluebyintegratingminingservicecapabilities,includingoverburdenremoval,coalproductionandtransportation.
Lookingforward,weseekabalancedexposuretotheunderlyingcommoditybyselectivelyidentifyingopportunitiesincoaltradingandmarketingviastrategicalliancesaswellastoaddvaluethroughtheacquisitionofminingconcessions.Keyconsiderationstothisstrategyincludescale,integration,captivebusinessandstabilityofcorerevenuesandearnings.
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1 23
4
5 6
DELTA, BOARD OF cOMMISSIONERS
1 Siswanto IndependentCommissioner2 Benny Wirawansa Commissioner3 Nurdin Zainal IndependentCommissioner4 Ilda Harmyn Commissioner5 Patrick Walujo VicePresidentCommissioner6 Erry Firmansyah PresidentCommissioner
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1
2 3
4 5
DELTA, BOARD OF DIREcTORS
1 Thomas Husted Director2 Ariani Vidya Sofjan Director3 Hagianto Kumala PresidentDirector4 Gunawan Angkawibawa Director5 Henry Kurniawan Latief Director
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MESSAGE FROM THE PRESIDENT DIREcTOR
Hagianto KumalaPresidentDirector
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Dear Shareholder,
Delta Results for 2009Welcome to the 2009 annual report of PT Delta Dunia Makmur Tbk. (Delta) covering a year in which the acquisition of PT Bukit Makmur Mandiri Utama (BUMA) was successfully completed.
Consolidated revenue in 2009 was Rp 1,129 billion with recurring net profit of Rp 13 billion. The results as presented in this report include the post acquisition earnings of BUMA for the two months ended December 31st 2009. Assuming contribution from BUMA on a full year gross basis, consolidated revenue was Rp 6,351 billion and operating profit was Rp 1,236 billion respectively in 2009. Extraordinary expenses were incurred firstly in respect of an impairment to Delta’s property portfolio and secondly in the form of financing and acquisition costs. After deduction of these extraordinary items and an adjustment for pre-acquistion income, Delta reported a loss of Rp 160 billion in 2009.
BUMA’s key performance highlightsThe underlying business performance of the subsidiary BUMA featured net revenue growth of 9.1 per cent, (excluding fuel costs) to Rp 5,182 billion. This was based on rising volumes of overburden removed, up 6 per cent to 277.7 million bank cubic meters (bcm), contributing 82 per cent to total gross revenue at BUMA. Coal production was down 9.9 per cent to 32.8 million tons (mmt). Two contracts were discontinued
during 2009, representing 16.9 per cent and 2.6 per cent of 2008 and 2009 production respectively. The implied stripping ratio was 8.5x in 2009, a substantial increase from 7.2x in 2008. Coal hauling volumes for the year grew by 27.5 per cent to 15.1 mmt. Over the past nine years BUMA has grown overburden volume by 5.4 times and coal mined by 5 times.
Positive outlook Prospects remain good for the sector, and hence for the contracting business. Though considerably below the all time peak in 2008, coal prices were again rising during 2009, as, for the first time, China became a net coal importer. Demand in the region as a whole has been strengthening, with economic growth levels resuming an upward trend. Recent export contract terms announced are approaching the US$100 per ton mark, as this report is being completed, an indicator that we may expect sustained growth during the year ahead.
A key focus for the next twelve months will be on a program of further improvements at BUMA and we look forward to reporting on the outcome of these measures. I would like to take this opportunity to thank our stakeholders for their support and extend our appreciation to all BUMA Board members who have guided the subsidiary through another year of sound progress. Finally, I would like to thank all BUMA employees for their dedication and hard work, our suppliers and the banks who have supported us over the last year.
For and on behalf of the Board of Directors
Hagianto KumalaPresident Director
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BUMA, BOARD OF DIREcTORS
1 Achmad Kharis Director2 Budikwanto Kuesar PresidentDirector3 William Surnata Director
1
2
3
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The BUMA coal Mining Value chain
DueinparttothehistoricaldevelopmentofminingregulationsinIndonesia,coalproducerstypicallycontractouttheoperationoftheircoalconcessionstothirdpartyminingoperators,suchasBUMA,underlong-termoperatingagreements.Thepracticeofappointingthirdpartyminingoperatorsdatesbacktothefirstgenerationofcoalconcessions.TheseconcessionsstipulatedthatthetitletoallequipmentpurchasedandusedbytheconcessionholderwithrespecttoitsconcessionwouldremainthepropertyoftheGovernmentupontheexpirationoftheconcession.
Asacoal-miningcontractor,BUMA’sresponsibilitiescoveralargepercentageoftheoverallcoalminingvaluechainincludingmininginfrastructuredevelopmentandconstruction,landclearing,removaloftopsoil,drillingandblasting,overburdenremoval,coalmining,hauling,reclamationandrehabilitation.In2009BUMAemployedover8,000staffoperatingmorethan3,200unitsofequipment,includingbulldozers,excavators,cranes,drillingmachines,primemoversanddumptrucks.
OPERATING REVIEW
contractor’s Role in the coal Mining Process
GEOLOGY & PLANNING
OVERBURDEN REMOVAL /cOAL MINING LOAD & HAUL PROcESSING BARGING
· Licenses· Exploration&Evaluation
· Geology–Modeling&interpretation
· Long-TermMinePlanning
· Long-TermandShort-TermMinePlanning
· Drilling&Blasting· Stripping· Excavation
· Loading· Haulage· Roadbuildingandmaintenance
· Reclamation
· Washing· Crushing/grinding
·Processingtoport
TYP
ICA
L AC
TIvI
TIES
BUMA’s core Scope of Work Mine Owners’ core Scope of Work
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customers and contract PortfolioSeveralrenewalandnewcontractsweresignedduringtheyear.InSeptemberacontractextensionforanotherfouryearswassignedwithLannaHaritaIndonesia,toexpireDecember2013.Amonthlateranextensionto2019oftheexistingcontractwassignedwithKidecoJayaAgungandinNovemberaoneyearcontracttoDecember2010wascompletedwithBukitBaiduriEnergy.
BUMA’stopfivecustomersaccountedforabout83percentofrevenuein2009,withoutexceptionalllargescaleproducersandexportersinthecoalindustryinIndonesia,withsignificantreservesandalongtrackrecordofprofitableoperations.Asof2009,BUMAhas11customercontractsinIndonesiawithacontractvalueofapproximatelyUS$5billion.
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WebelievethatBUMAhasestablishedastrongreputationasbeingamongthemostreliableandefficientminingservicecontractorsinIndonesia,withastrongperformancetrackrecordformeetingitscontractedtargetsandcoaldeliveryobligations.Todate,noneofBUMA’scustomershave,ifsorequestedbyBUMA,refusedtoextenditsoperatingagreementsupontheirexpiry,norhavetheyexercisedtheirearlyterminationrightswithrespecttoBUMA’soperatingagreements.
Production PlanningBUMA’sperformanceisbasedondetailedproductionplanningandmonitoringinconjunctionwiththelong-termplansoftheconcessionownersofeachoftheminesitesinwhichweoperate.Forthesmallerminesitismoreusualtoprepareanannualmineplan.Ourproductionplanningteamsmonitoronaquarterly,monthly,weeklyanddailybasisanddailybriefingsareconductedwithminesuperintendentstoensureprogressisbeingmadetoachieveproductiontargets.TheBUMAMineControlCenterSystem(MCC)iscontinuouslyupdatedwithrelevantdatafromeachoperationtoensureperformancemonitoringiseffective.
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Rain FactorCoalminingoperationswillceaseduringheavyraininordertoensurethatsafeminingstandardsareapplied.CertainregionsofIndonesia,inparticularKalimantan,inwhichallofBUMA’sminingprojectsarelocated,havearainyseasonwhichusuallyoccursfromOctobertoApril.Incontrasttotheprevioustwoyearsofexceptionallyheavyrainfall,thewetseasonin2009didnotcausemajordisruptionstotheproductionprocess.Routineprecautionarymeasuresincludetheupgradingofin-pithaulingroadsbyusinggraveltopreventvehiclesfromslipping.Thismethodalsohelpsconservefuelandimproveequipmentavailability.
BUMA: mining equipment and fleetBUMA’sminingoperationsdependgreatlyonitsplant,machinery,andequipmentperformance.Equipmentsizeisacompetitiveadvantage-operatinglargescaleunitswithhighercapacityhelpstoreducelabourrequirementsand,fuelusagepertonneofcoalandperbcmofoverburden.
BUMA’smanagementpreferstopurchasenewequipmentversusrentalofusedequipmentduetothehigherutilizationrateswhichcanbeachievedbynewandmoretechnologicallyadvancedmachinery.ThesizeofBUMA’soperationsgeneratessubstantialbargainingpowerwithequipmentsupplierswithinIndonesiatoobtain:betterequipmentdiscounts,orderpriority,flexiblepaymentterms,superiorsupportandexcellentaftersalesservice.
StrongbuyingpoweralsomeansBUMAhasbeengenerallylessaffectedbyrisingequipmentpricesandtightequipmentsupply.BUMAhastheoptiontopurchaseequipmentviatheIndonesianGovernment’s‘MasterList’facilitywhichofferseligibilityforlowerimportduty.MajorsuppliersincludePTUnitedTractorHeavyIndustry(S)Pte.Ltd.,PTUnitedTractorsTbk,PTTrakindoUtamaandPTEkaDharmaJayaSaktiTbk.
ConsignmentofsparepartsatBUMA’ssitestosupportthemainequipmentbrandsreducesBUMA’sworkingcapitalneeds,reducesobsoletestockandprovidesassuranceofpartavailabilityonsite.Manufacturerwarrantiesfornewequipmentpurchasestypicallylastforaperiodofsixmonths.StrictmaintenanceroutinesoperateatBUMAworkshopslocatedateachminingsite.Regularandappropriatelytimedoverhaulshelpprolongtheoperationallifeofmachinery,rangingfromthreetoeightyears.BUMAgenerallyusesOEMreplacementpartsandcomputer-basedmaintenancemanagementsystemstocontrolsparepartinventorylevels,purchasingandwarranty.
Closemonitoringofequipmentutilizationandstatuscontinuedin2009,allowingmanagementtomakeeffectivedecisionsonequipmentallocations.Totransferheavyminingequipment,BUMAhasalsoinvestedinitsownlandingcraftwhichplyriversandtheirtributariesbetweentherelevantconcessions.
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Fuel and consumablesRepresentingthelargestelementofcostofsales,fuelcostswerereducedin2009asonecustomer,Adaro,optedtoprovidefueldirectly,ratherthanviaBUMA.ThisisapositivedevelopmentforBUMAreducingtheamountofworkingcapitalrequiredtomanagefuelsupply.BUMAprocuresasubstantialamountofitsfuelrequirementsfromPertamina,underasupplyagreementbasedoninternationalmarketpriceslesstheamountofapplicablediscounts.Fuelcostsarepassedthroughtoconsumersgiventhatallcontracttermsallowforfuelcostescalation.Effortscontinuedduringtheyearwiththe“HydrocarbonProject”:aninitiativetoimprovefuelefficiencyandextendtheusefullifeofallequipment.
BUMAsecuresthemajorityofitsradialtiresthroughdirectlong-termfixed-pricecontractswithtireproducertherebyprotectingagainsttheriskoftireshortages,agrowingissueinlinewiththesubstantialminingsectorexpansioninrecentyears.
Information Management SystemsBUMAusesseveralinformationtechnologymanagementsystems.MineControlCentermonitorsproductionactivitieson-siteanddistributesinformationtodivisionalheads.FleetEdmonitorsequipmentperformanceandhistoricalrecordsforequipmentplanningandcosting.TheIntegratedInventoryControlSystemrunsallinventorycontrolreportsonobsolescence,inventoryturnoverandconsumption,andreportsstockanalysis,itemhistory,partsallocationandpurchaseorders.
Inadditiontothesesystems,BUMAalsohasaproprietarytirecontrolandmanagementsystemtoidentifythemostappropriatetiresforindividualprojects,calculatetiredeliveryschedules,monitortirerelateddowntimes(scheduledversusnon-scheduled),andtoprovidereportsandanalysessuchasimmediatereal-timecomparisonofdifferenttirebrandresults.
BUMAhasalsosecuredtelecommunicationssupporttolinkwithallofitsmininglocationswhicharegenerallylocatedintheremotepartsofKalimantanwherelocaltelecommunicationinfrastructureiseithernon-existentorrudimentary.CommunicationswiththesesitesaremadethroughtheVSATnetwork(VerySmallApertureTerminal),whichprovidesvoice,VoIP,fax,email,internetanddataconnectivity.
Delta Dunia MakMur annual rePOrt 2009 33
InApril2010,BUMAwillcommencetheimplementationofanEnterpriseResourcePlanning(“ERP”)systemusingSAPsolutionstooptimizetheperformanceofthebusinessprocesses,coveringfinance,humancapitalmanagement,informationtechnology,operationsandcorporateservices.TheimplementationofSAPERPisbeingdonebyDeloitteConsultingandisexpectedtogoliveforselectedmodulesinearly2011.
Health and SafetyBUMAemphasizesandplacesgreatimportanceonworkplacesafetyinallofitsminingoperations,andhasimplementedIndonesianandinternationallyrecognizedstandardsforindustrialhealthandsafety.Workplacesafetyisanimportantfactortakenintoaccountwhendeterminingmineplansandincreasingproductioncapacityatthemines.BUMA’sproprietaryhealth,safetyandenvironmentalmanagementinitiative,B’Safefocusesonhazardidentificationandriskassessment,aswellascontrolandmitigationofpotentialhazards.B’SafeisbasedonOHSAS(Occupational,HealthandSafetyAssessmentSeries)18001,ISO14001andIndonesianlaborregulations.Currently,BUMAhasobtainedOHSAS18001certificationswithrespecttoitsactivitiesonminingsiteslocatedattheAdaro,KidecoandIMKconcessions,andtheLatiminelocatedontheBerauconcession.
Allplantandequipmentisinspectedbeforeuseon-site,andissubjecttodailyinspectionsandmaintenanceinaccordancewithmanufacturerspecifications.Personalprotectiveequipmentisprovidedforallemployees,andallrequiredsafeguardsunderIndonesianhealthandsafetyregulationshavebeenimplemented.
AllofBUMA’semployeesreceivebasicsafetytrainingandspecializedtrainingwithrespecttohigh-riskworkactivities.BUMAalsoprovidescomprehensivetrainingandassessmentforallplantoperators,drivers,riggers,craneoperators,andsafetymanagementtrainingforallsupervisorypersonnel.
BUMA’ssafetyperformancehasimprovedovertheyears,asevidencedbythedecreasesinitsLostTimeInjuryFrequencyRate(“LTIFR”)andPropertyDamageFrequencyRate(“PDFR”).LTIFRmeasuresthenumberofincidentsperonemillionmanworkinghours,involvinginjurythatpreventsareturntowork,andPDFRmeasuresthenumberofunscheduledbreakdownsperonemillionequipmentworkinghours.
Environmental IssuesEnvironmentalawarenessandresponsibilityisequallyimportant,withISO14001accreditationfortheenvironmentalmanagementsystemsatfourminesites(Adaro,Kideco,Lati,andBinungan-Suaran).Furthersiteaccreditationisplannedtobecompletedintheyearahead.
Delta Dunia MakMur annual rePOrt 200934
Human Resources Development and TrainingPeopledevelopmentisaconstantcommitmentasthescaleandrangeofcontractscontinuestoexpandandinevitablycustomerstandardsandexpectationsrise.BUMAhasinvestedinequipmentsimulationdisplaysinordertoprovideeffectiveandefficienttrainingasnew,moresophisticatedmachineryisavailable.Simulatorsareaneffectivemeanstoensureoperatorscanmasterthenecessaryskillsinashortperiodoftime.
Throughtheyearimprovementswereexecutedtostrengthenthecapabilityofthetrainingcentertoprovidecomprehensiveandeffectivecoursesforalloperatorsandfrontlinemanagement.Advancedtechnicaltrainingwasalsoimplementedtobuildcompetenceinengineering,includingcoursestosupportupgradesinmineplanningsoftwareandhardware.Intensivemechanicaltraininghasimprovedknowledgeandtechnicalskillsformechanics.
Delta Dunia MakMur annual rePOrt 2009 35
Looking Ahead: Operational ImprovementsTherewereanumberofspecificimprovementprogramsin2009thatrequirespecialmention.Theseincludedupgradesinthestandardofoverburdenhaulingroadsbylayeringgravelinordertoimprovecycletimes,topreserveundercarriagelifetime,andtopreventagainstexcessivefuelusagethroughlackoftractiononslipperysurfaces.Plansareunderwaytoshifttolarger
capacitiesforthetruckfleet:inexcessof150tonpayloads,inordertoachievehigherproductivity,equipmentavailability,utilization,costeffectivenessandimprovedsafety.Multi-stagepumpsarebeinginstalledtoimprovedrainagefordeepmineareasinexcessof100metersandplansareunderwaytocompleteadispatchingsystemby2012inordertoimprovefleetmanagement.
Delta Dunia MakMur annual rePOrt 200936
Delta Dunia MakMur annual rePOrt 2009 37
Delta Dunia MakMur annual rePOrt 200938
FINANcIAL REVIEW
Overview – a shift of investment strategyIn2009,DeltamadeastrategicchangeinitsinvestmentfocusbyenteringthecoalminecontractingbusinessthroughtheacquisitionofPTBukitMakmurMandiriUtama(BUMA).AnewmanagementteamhasbeeninstalledbyshareholderstopropelDeltatoaleadingpositionintheIndonesiancoalindustry.Aspartofthetransformation,thelegacypropertybusinesses,whichoperateasseparatesubsidiaries,willbestrategicallydivestedstartingin2010.
Important InformationTheauditedfinancialstatements,includingtheincomestatementandfinancialpositionpresentedforDelta,theparentcompany,reflecttheperformanceofBUMAforonlypartof2009,theyearinwhichtheacquisitionoccurred.ThusnomeaningfulcomparisonwiththeresultsforDeltain2008ispossible.Fortransparencyandclaritythecommentarybelowincludesreferencetoselectedcomparativedatacoveringboth2009and2008,sourcedfromtheaccountsofBUMAinordertogivethereaderaproperperspectiveonthesubsidiary’sperformance,yeartoyear.
Deltaanditsprimarysubsidiary,BUMA,arerequiredtoreportthefinancialperformanceinRupiahtocomplywithregulatoryrequirements.BUMA’srevenueisreceivedinUSDollarsorinRupiah,peggedtotheprevailingUSDollarexchangerateatthetimeofinvoicing.MostcostsarealsoinUSDollars.AlldebtfinancingisdenominatedinUSDollarssinceitisprimarilyusedtofinanceimportedheavyequipment.AverageRupiahtoUSDollarexchangeratesin2008wereRp10,950/US$andin2009wereRp9,400/US$.
Operating IncomeDelta’sprinciplesourceofrevenueofRp6,351billionin2009(onagrossmethodbasis)wasfromthecoalcontractingoperationsofBUMA.RevenuesgeneratedbyBUMAarebasedonlong-termcontractswithformula-basedpricingforunitratesofoverburdenvolumesremoved,coaltonnagesexcavatedandcoaltonnageshauledtopreagreeddestinations.Contractsalsocontainadjustmentsforchangesinverticalandhorizontaldistancestravelledaswellasanychangeinsiteconditions.In2009therevenuesofBUMAwereRp6,350billion(2008:Rp6,765billion),slightlyloweryearonyearasaresultofloweraveragefuelpricesandduetoachangeofpracticeasonemajorcustomerstartedtoprovideitsownfuel.Fuelcostsarefullypassedthroughandthusprofitabilitywasunaffected.
AlthoughBUMAdoesnottakedirectcommoditypricerisk,itdoesbenefitfromahighcoalpriceenvironmentwhenmineownersaccelerateproductionplanstomonetizehighprices.BUMAalsobenefitsasmarginalcoaldepositsbecomeprofitable.Thistypicallyresultsinanincreaseinstripratios,whichtranslatesintohigheroverburdenremovalvolumetoproducethesametonnageofcoal.
Delta Dunia MakMur annual rePOrt 2009 39
BUMA’stotalcostofrevenue,excludingfuelcost,increasedby10.5%yearonyear,mostlydrivenbyanincreaseintireandblastingmaterialcosts.OperatingexpensesatBUMAwerehigherby12.2%yearonyearbasedonincreasesinsalaries,benefitsandgeneraloverheadanddepreciation.ThistranslatesintoanoperatingincomeofRp1,253billionin2009(2008:Rp1,194billion).BUMArecordedRp2,103billioninEBITDAwhichequatesto40.6%EBITDAmargintonetrevenue(revenueexcludingfuelcost)in2009,relativelystablecomparedtothe2008EBITDAmarginof41.5%.Onaconsolidatedbasis,DeltarecordedanEBITDAofRp2,096billionin2009andoperatingincomeofRp1,236billion.
Non-operating income (expenses)DeltarecordedatotalofRp614billioninnetnon-operatingexpenses,derivedfromtheincreaseininterestexpenseattheBUMAlevelofRp250billionaswellasseveralextraordinaryexpenseswithanaggregateamountofRp436billion,relatingtotheimpairmentofitspropertyportfolioaswellasfinancingandacquisitioncosts.TheseexpenseswereoffsetbyforeignexchangetranslationgainsofRp329billionmainlyontheUSDollardenominateddebt.Taxes and pre-acquisition income adjustments Delta’stotaltaxpaymentwasRp270billion.Aftertheeliminationofthepre-acquisitionincomefromBUMA,priortoDeltaacquiringsharesofBUMA,Delta’snetlosswasRp160billionin2009.Excludingtheextraordinaryitemsmentionedabove,Delta’snetincomewasRp13billion.
Financial position
AssetsTheCompany’sconsolidatedcurrentassetsamountedtoRp2,965billion,comprisedmainlyofBUMA’sreceivablesofRp1,719billionwhilecashandshortterminvestmentamountedtoRp586billion.Receivablesgrowthof3%attheBUMAlevelwasinlinewiththegenerallevelofbusinessactivityfortheyear.InventoriesofRp198billionreflectedfuelandtirestocksheld,amongotheritems,fortheoperationoftheminingcontractingbusiness.
NoncurrentassetsamountedtoRp3,605billion,primarilyconsistingofminingequipment.
LiabilitiesConsolidatedcurrentliabilitiesamountedtoRp964billion,comprisingofRp360billionoftradepayablesonfuel,equipmentmaintenanceandsparesinventorieswhilethecurrentportionoflongtermdebtamountedtoRp328billion.
Non-currentliabilitiesofRp5,407billionincludetheSeniornotesfacilityofUS$315millionandtheUS$285millionsyndicatedloansattheBUMAlevel.
Delta Dunia MakMur annual rePOrt 200940
cORPORATE GOVERNANcE
AtDeltawedefinegoodgovernanceasconductingbusinessandengagingwithstakeholdersinamannerwhichistransparent,responsible,accountable,fair,independentandsustainable.
Governanceispracticedthroughoutalloperationsandatalllevelsofouroperations(includingthoseofoursubsidiaries)andisreflectedin:• Distinctrolesandresponsibilitiesagreed
fortheBoardsofCommissionerswhoareaccountabletoallshareholdersandfortheBoardofDirectorswhoareaccountabletotheBoardofCommissionersandshareholders;
• Wellarticulatedbusinessobjectivesandclearstrategieswithwhichtoattaintheobjectives;
• Theadoptionoffairandethicalpracticeinbusiness,operationsandcommunications;
• Theimplementationofprudentriskmanagementandtimely,accuratereportsanddisclosures;
• Thesettingofsafety,healthandenvironmentalstandards;
• Aprogramofcorporatesocialresponsibilitywhichmitigatesandmaximizesournegativeandpositiveimpactonourneighbors.
Governance StructureInNovemberandDecember2009someimportantmanagementchangeswerecompletedtoensurecohesive,effectivemanagementandgovernanceforboththelistedholdingcompanyandprincipalsubsidiary.
Shareholders ThroughtheAnnualGeneralMeetingofShareholders(AGM),shareholdersdeterminethecompositionoftheBoardsofCommissionersandDirectors;voteonissuesrequiringmajorityconsensus,andapproveimportantCompanyresolutions.
In 2009, several shareholder meetings took place: • ThefirstExtraordinaryGeneralMeetingof
Shareholders(EGMS)wason30June2009andthefollowingwasagreed:(i)thechangeandextensionofthecorebusinessoftheCompany,(ii)increaseofauthorizedcapitalfromRp1trilliontoRp1.35trillion,(iii)placementoffundininvestmentinstrumentand(iv)appointanadditionaldirector.
• EGMSon30September2009passedthefollowingkeyresolutions:(i)approvalfortheacquisitionprocessofPTBukitMandiriMakmurUtama(BUMA),(ii)changeinthescopeofactivitiesoftheCompanyfromapropertydevelopertoanintegratedminingandenergycontractor,(iii)changeoftheCompany’snamefromPTDeltaDuniaPropertyTbk.toPTDeltaDuniaMakmurTbk.
• EGMSon11November2009and21December2009approvedtheappointmentoftheBoardofCommissionersandBoardofDirectors.
Delta Dunia MakMur annual rePOrt 2009 41
DELTA
Board of commissioners As of 31 December 2009, there were six Commissioners, two of whom were Independent Commissioners.
Erry Firmansyah – President commissioner Mr.FirmansyahhasservedasthePresidentCommissionerofDeltasinceNovember2009.HealsoservesasaCommissioneroftheStateOwnedAssetsManagementCompany(thesuccessorofIBRA).Priortohiscurrentposition,hewasthePresidentDirectoroftheIndonesiaStockExchangefromApril2002toAugust2009andthePresidentDirectorofKliringSentralEfekIndonesia(KSEI)from1998to2002.HewasappointedasControlleroftheLippoGroupin1991andasaDirectorofLippoLandin1995.HisbeganhisprofessionalcareerwithPriceWaterhouseasanauditor.HeisagraduateoftheUniversityofIndonesia.
Patrick Sugito Walujo – Vice President commissionerMr.WalujohasservedastheVicePresidentCommissionerofDeltasinceNovember2009.Heisaco-founderofNorthstarEquityPartners,aleadingIndonesiafocusedprivateequityfund.PriortoNorthstar,heservedasSeniorVicePresidentofPacificCenturyGroupVenturesLtdinTokyoandasaninvestmentbankerwithGoldmanSachs,basedinLondonandNewYork.HeholdsaBachelorofScience,majoringinOperationsResearch&IndustrialEngineeringfromCornellUniversity,USA.
Siswanto – Independent commissionerMr.SiswantohasservedasanIndependentCommissionerofDeltasince2008.HeholdsseveralconcurrentpositionsincludingPresidentDirectorofPTSafira,DirectorofPTMuliaBhaktiAbadi,CommissionerofPTLajuPerdanaIndah,CommissionerofPTTrubaBaraBanyuenimandIndependentCommissionerofPTTrubaAlamManunggalTbk.HeisaretiredBrigadierGeneraloftheIndonesianArmy.
Nurdin Zainal – Independent commissionerMr.ZainalhasservedasanIndependentCommissionerofDeltasinceNovember2009.Heretiredin2006asaMajorGeneralinthearmedforcesandsubsequentlyservedinseveralprivatesectorpositions.HeisagraduateoftheNationalTenacityInstitution(Lemhannas)andholdsamastersdegreeinmanagementfromSTIEWidyaJayakarta,Jakarta.
Ilda Harmyn – commissionerMr.HarmynhasservedasaCommissionerofDeltasinceDecember2009.HecurrentlyservesasanOperationsDirectoratNorthstarPacificCapital.From1996to2008,heworkedinseveralpositionsatKaltimPrimaCoal,thelastpositionbeingtheGeneralManagerforMiningOperationsandContractMining.HeholdsaBachelorDegreeinMiningEngineeringfromBandungInstituteofTechnology.
Benny Wirawansa – commissionerMr.WirawansahasservedasaCommissionerofDeltasinceDecember2007.Priortothisposition,Mr.WirawansawastheChiefOperatingOfficeratthePalmSpringGolfandBeachResortonBatamIslandfrom2004to2007.In2008,hewasappointedasaCommissionerofEmeraldaGolfandCountryClub.
Responsibilities – Board of commissioners TheBoardofCommissioners(BoC),ledbyPresidentCommissioner,ErryFirmansyah,provideconsultancyandsupervisionfortheBoardofDirectors,andmonitordecisionandpolicymakingandstrategyimplementation.TheBoCprovidesanassessmenttotheShareholdersontheBoardofDirectors’performancetowardsthestatedbusinessplanandbudget,andontheirfinancialandotherreports.
MembersoftheBoardofCommissionersareappointedbyShareholdersduringtheAGM,andservetermsoffouryears;subsequenttermsmaybeservedwithShareholderapproval.
Delta Dunia MakMur annual rePOrt 200942
Board of DirectorsAsof31December2009,theBoDcomprisedfivemembers.
Hagianto Kumala – President DirectorMr.KumalahasservedasthePresidentDirectorofDeltasinceDecember2009.Priortothisposition,heservedasthePresidentDirectorofPTUnitedTractorsTbk.(UT)from1999to2007andasaCommissionerfrom2007to2009.HewasthePresidentCommissionerofBerauCoalfrom2001to2004havingbeenaCommissionerfrom1998to2001.FormerpositionsincludePresidentCommissionerand/orCommissioneratPTPamapersadaNusantara,PTToyotaAstraMotor,PTKomatsuIndonesia,PTAstraAgroLestariTbk.andPTAstraGraphiaTbk.,amongothers.HeholdsaBachelorDegreeinIndustrialEngineeringfromBandungInstituteofTechnology.
Thomas Husted – Director Mr.HustedhasservedasaDirectorofDeltasinceNovember2009.In2008hefoundedPacificOceanCapital,aninvestmentfirmbasedinSingapore.From2004to2007Mr.HustedwastheHeadofCorporateFinanceatPTBankDanamonIndonesia.HejoinedCitigroupin1999andheldvariouspositionswithintheCorporateandInvestmentBankinIndonesia,SaudiArabiaandHongKong.HeisagraduateoftheUniversityofArizonaandColumbiaUniversityinNewYorkCity.
Ariani Vidya Sofjan – DirectorMs.SofjanhasservedasaDirectorandHeadofInvestorRelationsofDeltasinceDecember2009.ShepreviouslyservedasanExecutiveDirectorofPTNorthstarPacificCapital.From2003to2008shewastheHeadofResearchatMandiriSekuritasandwasaSeniorAnalystfrom1999to2003atBahanaSecurities.ShebeganhercareerasanEquityAnalystwithDeutscheMorganGrenfellAsiain1994.SheholdsaBachelorofSciencedegreeinFinancefromOklahomaStateUniversity,USA.
Gunawan Angkawibawa – DirectorMr.AngkawibawahasservedasaDirectorofDeltasince2007.Hiscareerfocushasbeenpropertydevelopment.PriortojoiningDelta,hewastheGeneralManagerofDevelopmentfortheSurabayaInternationalTradeCenter.HegraduatedfromTrisaktiUniversityinengineeringstudiesandholdsamasterdegreeinmanagementfromPrasetiyaMulyaSchoolofManagement.
Henry Kurniawan Latief – DirectorMr.LatiefhasservedasaDirectorofDeltasince2009.HeholdsabachelordegreeincomputersciencefromtheUniversityofBinaNusantara.
Delta Dunia MakMur annual rePOrt 2009 43
Responsibilities – Board of DirectorsUnderPresidentDirectorHagiantoKumala,theBoardofDirectors(BoD)isresponsibleformanagingtheCompanytowardsthecompletionofitsbusinessplanandinaccordancewithprevailingregulations.TheBoDdeterminesstrategiesandbudgets,andmeasuresoperationalsuccessbaseduponperformanceagainststatedCompanystrategiesandmeasurabletargets.
MembersoftheBoardofDirectorsareappointedbyShareholdersduringtheAGMandservetermsoftwoyears;subsequenttermsmaybeservedwithShareholderapproval.
Remuneration of the Board of commissioners and the Board of DirectorsTotalremunerationfortheBoardofCommissionersandtheBoardofDirectorsfortheyear2009wasRp570million.
Good Governance committeesToassistwithandensuretheimplementationofgoodgovernancepracticesthroughouttheCompany,theBoardsofCommissionersandDirectorsaresupportedbythreegovernancebodies:theAuditCommittee,theInternalAuditDivision,andtheCompany’sCorporateSecretary.
The Audit committeeTobeappointedbyandresponsibletotheBoardofCommissioners,theAuditCommittee’sprimaryroleswillbetoassisttheBoCinfulfillingitsresponsibilities;independentlymonitorandevaluatefinancialinformationandreportingwithintheCompany,andimplementriskmanagement,internalcontrol,andassurance.
TheAuditCommitteecomprisesaChairmanandtwomembers;bothofwhichareindependentofthemajorityshareholdersoftheCompany.
Siswanto – chairmanSteven cahyadi – MemberDarius Handoko – Member
Internal AuditAspartofriskmanagement,theInternalAuditDivision(IAD)conductsinternalauditactivitiesbasedupontheCompany’sannualauditplan,asapprovedbytheBoardofDirectors.TheIADreportstotheBoardofDirectorsandtotheAuditCommittee.
External AuditAppointedbytheBoardofDirectorswithAGMapproval,externalauditoftheCompany’sfinancialstatementswasconductedbyTjiendradjaja&HandokoTomo(Mazars)forthefiscalyear2009.
corporate SecretaryReportingtothePresidentDirector,theCorporateSecretaryensuresthattheCompanyisawareofandcomplieswithallprevailinglawsandregulations.TheCorporateSecretaryalsofacilitatesthesmoothandtimelyflowofinformationbetweentheCompanyanditsstakeholders,andliaiseswiththecapitalmarketauthorities.
AllkeycorporateinformationisreadilyavailableontheCompany’swebsiteatwww.deltadunia.com.Asat31December2009,theroleofCorporateSecretarywasheldbyAndreSoelistyo.
Delta Dunia MakMur annual rePOrt 200944
BUMA
John Lensa – President commissionerMr.LensahasservedasthePresidentCommissionerofBUMAsince2009.Heistheoriginalfounderandmanagerofthecompanyuntilitssalein2009.From1988to2000,heperformedpalmoilcontractingworkforPTAstraAgroLestariTbk.,theSalimandSinarMasGroups.From1994to1998,hebegantheminingcontractingbusinessasasubcontractorofPTPamapersadaNusantara.From1980to1987,hewasinvolvedinthecontractingbusinessthroughPTUnicoUtama,acompanyinvolvedindam,roadandhighwayconstruction.
Patrick Sugito Walujo – Vice President commissionerMr.WalujohasservedastheCommissionerofBUMAsinceNovember2009.Heisaco-founderofNorthstarEquityPartners,aleadingIndonesiafocusedprivateequityfund.PriortoNorthstar,heservedasSeniorVicePresidentofPacificCenturyGroupVenturesLtdinTokyoandasaninvestmentbankerwithGoldmanSachsbasedinLondonandNewYork.HeholdsaBachelorofScience,majoringinOperationsResearch&IndustrialEngineeringfromCornellUniversity,USA.
Sunata Tjiterosampurno – commissionerMr.TjiterosampurnowasappointedasaCommissionerofBUMAinNovember2009.HehasbeenanExecutiveDirectorofNorthstarAdvisorsPte.Ltd.since2006.BeforejoiningNorthstar,hewasanInvestmentBankerforPTDanareksaSekuritasandpriortothataconsultantofBostonConsultingGroup,advisingclientsoncapitalmarket,strategyandbusinessrestructuringacrossdifferentindustries.HebeganhiscareeratLippoSekuritas-SBCWarburgasAssistantVicePresidentinEquityResearch.HeearnedhisMasterinFinancefromLondonBusinessSchoolin2002andBachelorofBusinessAdministrationfromUniversityofWisconsin,Madisonin1995.
Delta Dunia MakMur annual rePOrt 2009 45
Board of Directors
Budikwanto Kuesar – President DirectorMr.KuesarhasservedasthePresidentDirectorofBUMAsince2009.HewastheManagingDirectorofBUMAfrom2001to2009.Mr.KuesarbeganhiscareeratPTUnitedTractorsTbkasAdministrationDepartmentHeadin1974.HeheldseveraladditionalpositionswithinUnitedTractorsuntilbecomingtheDeputyGeneralManagerforthePlantHireMiningDivisionin1991.In1992,hewastransferredtoPTPamapersadaNusantara(Pama),whereheservedasOperationsDirectoruntil2001.HegraduatedfromAkademiPendidikanKejuruanin1973.
William Surnata – Director – cFOMr.SurnatahasservedasaDirectorofBUMAsince2009.HejoinedBUMAin2004astheHeadofBusinessDevelopment.PriortojoiningBUMA,Mr.Surnatawasacareerbanker.HegraduatedfromUniversitasParahyanganinBandungwithadegreeincivilengineering.
Achmad Kharis – Operation DirectorMr.KharishasservedasaDirectorofBUMAsince2009.HisprimaryresponsibilitiesaretooverseeBUMA’sdaytodaybusinessandmarketingoperations.PriortojoiningBUMAin1998,heworkedatPTPamapersadaNusantara(Pama)asanoperationalmanager.HegraduatedfromUniversitasGajahMadainYogyakartawithadegreeingeology.
Delta Dunia MakMur annual rePOrt 200946
ThisAnnualReportandtheaccompanyingfinancialstatementsandrelatedfinancialinformationaretheresponsibilityofthemanagementofPTDeltaDuniaMakmurTbk.andhavebeenapprovedbythemembersoftheBoardofDirectorsandtheBoardofCommissionerswhosesignaturesappearbelow:
Board of commissioners
Erry FirmansyahPresidentCommissioner
Patrick WalujoVicePresidentCommissioner
SiswantoIndependentCommissioner
Nurdin ZainalIndependentCommissioner
Ilda HarmynCommissioner
Benny WirawansaCommissioner
Board of Directors
Hagianto KumalaPresidentDirector
Thomas Husted Director(CFO)
Ariani Vidya SofjanDirector
Gunawan AngkawibawaDirector
Henry Kurniawan Latief Director
Delta Dunia MakMur annual rePOrt 2009 47
SHARE INFORMATION
2009: Share Price Range by Quarter
Period Highest Lowest closing Volume Value Frequency
Q1 520 470 520 80,000 39,875,000 11
Q2 1,080 500 960 43,633,000 36,025,790,000 3,279
Q3 2,100 920 1,880 995,548,000 1,728,958,152,500 37,537
Q4 1,990 1,400 1,690 1,612,813,500 2,619,041,990,000 46,613
History of Stock Listing
Number of Shares Year
InitialPublicOffering 205,770,930 2001
ChangeofShareOwnership 205,770,930 2002
ChangeofShareOwnership 205,770,930 2003
RightIssueI 2,777,895,930 2004
CapitalStockIncrease 3,395,205,930 2007
ChangeofParValue
FromRp50toRp100pershare
6,790,411,860 2008
Total shares 6,790,411,860
Delta Dunia MakMur annual rePOrt 200948
ADDRESSES
PT Delta Dunia Makmur Tbk.Cyber2Tower,28thfloorJl.HRRasunaSaidBlokX-5No.13Jakarta12950,Indonesia
T+62-2129021352F+62-2129021352www.deltadunia.com
PT Bukit Makmur Mandiri Utama (BUMA)KomplekHarmoniMasBlokA/7,8,9,36Jl.JembatanDuaJakarta14450,Indonesia
T+62-216613636F+62-216618917/8
PUBLIc AccOUNTANT
Tjiendradjaja & Handoko Tomo (Mazars)Jl.SisingamangarajaNo.26,2ndfloorJakarta12120,Indonesia
T+62-217202605F+62-2172788954www.mazars.co.id
Delta Dunia MakMur annual rePOrt 2009 49
consolidated Financial StatementsWith Independent Auditors‘ Report
For the Year Ended December 31, 2009(With comparative Figures for the Year Ended December 31, 2008)
PT Delta Dunia Makmur Tbk (Formerly PT Delta Dunia Property Tbk) and Subsidiaries
Delta Dunia MakMur annual rePOrt 200950
Table of contents
BoardofDirectors’Statement
IndependentAuditors’Report
1ConsolidatedBalanceSheet
3ConsolidatedStatementofIncome5ConsolidatedStatementofChangesinEquity
6ConsolidatedStatementsofCashFlows
8NotestotheConsolidatedFinancialStatements
Delta Dunia MakMur annual rePOrt 2009 51
Delta Dunia MakMur annual rePOrt 200952
PT Delta Dunia Makmur Tbk.Cyber2Tower,28thfloorJl.HRRasunaSaidBlokX-5No.13Jakarta12950,IndonesiaT+62-2129021352F+62-2129021352 www.deltadunia.com>