Delta Dunia Group Reports Stable 9M 2024 Performance Amidst Strategic Diversification

Jakarta, Indonesia – December 20, 2024 – Delta Dunia Group (IDX: DOID) has announced stable revenue of USD 1.35 billion for the first nine months of 2024, despite significant operational challenges due to extreme weather in Indonesia and Australia. The company also highlighted a strategic shift towards diversification through key acquisitions and long-term contracts.

The company’s performance in the first nine months of 2024 reflects resilience in the face of a 38% increase in rainfall in Indonesia and a 53% increase in Australia, the company said in the statement.

While the weather caused operational disruptions, Delta Dunia Group effectively mitigated the impact, limiting the decline in overburden removal to 9% year-on-year and increasing coal production by 3%. The Group’s EBITDA decreased by 16% YoY to USD 252.3 million due to the weather conditions and planned investments to expand production capacity.

However, the net loss improved significantly, decreasing to USD 17.4 million from USD 26.6 million in the first half of 2024. This improvement was supported by favorable currency exchange rates and the stability of the Secured Overnight Financing Rate (SOFR).

According to the press release, Delta Dunia Group has made strategic moves to diversify its portfolio including:

• The acquisition of a majority stake in Atlantic Carbon Group, Inc. (ACG) in the U.S., expanding the company into mine ownership and increasing non-thermal coal revenue to 26% of total revenue, with projections to reach 28% by the end of 2024.
• A binding agreement to acquire 51% of the Dawson Complex, a major metallurgical coal mine in Australia.
• Increased investment in 29Metals Limited, a copper-focused mining company in Australia, further diversifying into base and precious metals.

These acquisitions are part of a strategy to reduce reliance on thermal coal, expand geographically, and ensure long-term growth.

Iwan Fuad Salim, Director of Delta Dunia Group, stated, “The 9M 2024 period has been another important phase in our transformation journey, marked by significant achievements that solidify our steps toward sustainable growth. Through strategic acquisitions, significant contract wins, and further diversification into non-thermal coal and base metals, we are building a diversified and future-ready business that provides lasting value for all stakeholders”.

The company also secured several significant long-term contracts including an 11-year agreement with PT Indonesia Pratama worth USD 7.8 billion, a two-year contract extension at Meandu Mine in Australia for AUD 200 million per year, and a life-of-mine contract with PT Persada Kapuas Prima for USD 755 million. These contracts have tripled the group’s order book to over USD 12.7 billion.

The financial health of the Group remains strong with a net debt-to-EBITDA ratio of 2.17x as of September 2024. The successful issuance of BUMA II Bonds in September 2024, which was 1.4 times oversubscribed, demonstrates strong investor confidence in the group’s cash flow management.

Delta Dunia Group’s strategic shift towards diversification and its commitment to operational excellence have positioned it for long-term success in the global mining sector. The company’s expansion into the US market and diversification of commodities demonstrates an understanding of future trends and an effort to become a global diversified mining company. The acquisitions did lead to a short-term decrease in free cash flow, but the investments are part of the group’s long-term strategy.

The company also established PT Bukit Teknologi Digital (BTech) to develop AI-based deep learning technology to improve efficiency, reduce emissions, and minimize health and safety risks. Additionally, PT BISA Ruang Nuswantara (BIRU), a social enterprise, focuses on education and promoting a circular economy.

Timeline of Events (Primarily covering 9M 2024):

• Early 2024 (through September 2024):Delta Dunia Group experiences significant challenges due to extreme weather in Indonesia and Australia, with increased rainfall impacting operations (38% increase in Indonesia, 53% increase in Australia).
• Despite weather challenges, the group maintains stable revenue of USD 1.35 billion.
• Delta Dunia Group invests heavily in capital expenditures, increasing 79% YoY to USD 133.1 million.
• Operational cash flow grows 2% YoY to USD 232 million.
• The group’s net loss improves to USD 17.4 million, down from USD 26.6 million in 1H 2024, despite increased financing costs.
• The group experiences a 16% YoY decrease in EBITDA, reaching USD 252.3 million, due to weather and planned investments.
• Net debt to EBITDA ratio stands at 2.17x as of September 2024.
• The group secures several significant contracts, including:
• 11-year, USD 7.8 billion contract with PT Indonesia Pratama (Bayan Group subsidiary).
• 2-year, AUD 200 million per year contract extension at Meandu Mine with TEC Coal Pty Ltd.
• Life-of-Mine contract worth USD 755 million with PT Persada Kapuas Prima.
• Delta Dunia Group’s order book increases threefold to over USD 12.7 billion.
• June 2024:Delta Dunia Group, via PT Bukit Makmur Internasional, acquires Atlantic Carbon Group, Inc. (ACG), marking expansion into the US market. ACG results are consolidated into Delta Dunia Group’s Q3 financials.
• Delta Dunia Group is recognized as one of the top 200 companies in the FORTUNE Southeast Asia 500 ranking.
• Q3 2024:Delta Dunia Group’s capital expenditures reach USD 133.1 million.
• The group signs a binding agreement to acquire 51% of the Dawson Complex in Australia.
• The group increases its investment in 29Metals Limited, an Australian base and precious metals mining company.
• September 2024:Delta Dunia Group issues BUMA II Bonds which are oversubscribed by 1.4x.
• Rasio Utang Bersih terhadap EBITDA remains at 2.17x.
• Throughout 9M 2024:The group strategically increases its investments in non-thermal coal, reaching 26% of revenue by the end of 9M 2024.
• Projected End of FY2024:Non-thermal coal revenue is projected to increase to 28%.
• December 20, 2024:Delta Dunia Group announces its stable 9M 2024 results and transformative achievements, signaling a shift towards long-term growth.