BRMS Initiating Cov 01FebJan12editedMS

Initiating Coverage | 01 February 2012
FOCUS
BUY
Monetizing assets and potential sizable tax saving
Monetizing assets is imminent, in our view. Bumi Resources Minerals (BRMS) has abundant diversified high-quality mineral assets, with most of the projects being green field. It needs a lot of money to develop its assets. We estimate it is very likely for BRMS to sell some of its ownership in its subsidiaries while keeping its majority stakes in order to unlock their value and fund their development. We expect such partial divestment will happen after the Gorontalo and Citra Palu have received JORC certifications in 1H12 or after the Dairi asset gets exploitation permit. Potential sizable corporate tax saving ahead. The biggest contributor to the consolidated net income and cash flow is NNT. MDB, a subsidiary of BRMS, has 24% stake in NNT. According to the Indonesian tax regulation, contribution from associate company is not taxable if the ownership is at least 25%, which means MDB needs to increase its stake in NNT by at least 1% in order to make NNTs contribution not taxable. There are several ways for MDB to increase its stake at NNT. However, we think the most likely way is increasing its stake when NNT launches an IPO, which may happen in 2012. Based on our scenario analysis, If contribution from NNT is not taxable, consolidated FY13F net income would increase by 19% and 18% from our base case scenario and consensus estimates, respectively. Catalysts: 1) Bumi Mauritania commences its production in 1H12. 2) Gorontalo and Citra Palu get Joint Ore Reserve Committee (JORC) certification on their reserves in 2012. 3) issuance of exploitation permit for Dairi project. 4) MDB increases its stake at NNT to at least 25%. Key Risks: 1) commodity price fluctuation. 2) project delay. 3) regulatory issues. Initiate with a Buy recommendation, Target price at Rp830. We use a conservative SOTP valuation method which resulted in a TP of Rp830. We apply DCF method for valuing NNT Batu Hijau, Dairi and Bumi Mauritania, while we use investment cost plus capex for valuing Gorontalo, Citra Palu and Konblo. We does not take into account Bumi Japan, NNT Elang and Rinti, Dairi Lae Jahe and Base Camp to our valuation, which may generate significant upside when they are realized.
FINANCIAL SUMMARY YE Dec (Rp bn) EBITDA Net Profit EPS (Rp) EPS growth (%) P/E Ratio (x) EV/EBITDA (x) P/B Ratio (x) Dividend Yield (%) ROAE (%) 2009A 3 (0) (253) n/a (2.2) 48.7 (0.0) 0 0.1 2010A 118 765 60 n/m 9.4 67.3 0.4 0 9.3 2011F 95 722 28 (52.6) 19.8 181.3 0.8 0 4.2 2012F 398 814 32 12.7 17.6 47.0 0.8 0 4.6 2013F 896 1,806 71 121.9 7.9 19.0 0.7 0 9.4
Bumi Resources Minerals

SECTOR: METAL MINING
Current Price Price Target Fair value 52-wk range Rp560 Rp830(+48.2%) Rp830 Rp500-Rp800
Stock data
Bloomberg Code Market Cap (Rp bn/US$ mn) Issued Shares (mn) Avg. Daily T/O (Rp bn/US$ mn) BRMS IJ 13,808/1,530 25,570 8.6/0.95
Major shareholder
Bumi Resources Others 87.0% 12.9%
EPS consensus
11F Consensus (Rp) 34 12F 50 (36.6)
MS est. vs Consensus (%) (16.1)
Share price performance

3m Absolute (%) Relative to JCI (%) 1.9 (5.3) 6m (31.6) (25.8) 12m (16.9) (31.6)
Hariyanto Wijaya, CPA, CFA +6221 5296 9553 hariyanto.wijaya@mandirisek.co.id Verdi Budiman +6221 5296 9542 verdi.budiman @mandirisek.co.id
Source: Company, Mandiri Sekuritas
Please see important disclosure at the back of this report
Page 1 of 30
Investment thesis
In progress to become one of the leading metal mining companies in Asia BRMS through its subsidiaries has diversified mineral assets, i.e. gold, copper, zinc, lead, iron ore, molybdenum, and diamond in several locations in three countries, i.e. Indonesia, Liberia, and Mauritania. From risk management perspective, various locations reduce local-related risks, such as local government regulation and natural disaster. Currently, only gold and copper are in production at BRMS associate company, i.e. Newmont Nusa Tenggara (NNT). Meanwhile, the other commodities are in development stage. BRMS has effective stake of 18% in NNT. The majority stake in NNT is owned by Newmont Mining Corporation (NEM US), a listed company in New York Stock Exchange. Newmont Mining Corporation also acts as the operator in NNT.
EXHIBIT 1. BRMS MINERAL ASSETS ARE SPREADED IN SEVERAL LOCATIONS
Source: Company
EXHIBIT 2. MINERAL ASSET PORTFOLIO AT VARIOUS LEVEL OF DEVELOPMENT CYCLE

FIRST PHASE SECOND PHASE
Asset NNT (batu hijau) Mauritania Dairi (Anjing Hitam) Gorontalo Citra Palu Konblo Bumi (Liberia)
Exploration Production
2010
2011
2012
2013
2014
2015
PRODUCTION DEVELOPMENT DSO PRODUCTION PRODUCTION DEVELOPMENT PRODUCTION FEASIBILITY STUDIES DEVELOPMENT PRODUCTION FEASIBILITY STUDIES DEVELOPMENT PRODUCTION EXPLORATION AND DEVELOPMENT ACTIVITIES
Source: Company
Page 2 of 30
EXHIBIT 3. BRMS HAS VARIOUS MINERAL ASSETS AT ITS SUBSIDIARIES LEVEL

Public
13%
PT Bumi Resources Tbk (BUMI)

87%
PT Bumi Resources Minerals Tbk

99.99% 99.99% 20% 100% 99.99% 100%
PT Multi Capital
75%
Calipso Investment Pte. Ltd.

80% 100%
International Minerals Company LLC
Lemington Investments Pte. Ltd.
Bumi Resources Japan
PT Multi Daerah Bersaing
Herald Resources Ltd.

100% 60%
Gain and Win Pte. Ltd.

24% 80% 80% (1) 96.97%
Bumi Holding S.A.S

89% (2) 94.1%(3)
PT Newmont Nusa Tenggara

Effective ownership
18.0% Legend
PT Dairi Prima Mineral

Effective ownership
80.0%
PT Sarkea Prima Minerals

Effective ownership
100.0%
PT Gorontalo Minerals
Effective ownership
80.0%
PT Citra Palu Minerals

Effective ownership
96.97%
Bumi Mauritania SA
Effective ownership
53.39%
Konblo Bumi Inc. (Liberia Project)

Effective ownership
94.1%
Investment Holding Companies Operating/Developing companies Marketing Service company (1) (2) (3) Subject to progressive divestment to 49.0 % beginning from the end of the fifth year after commencement of production at the Gorontalo project In January 2012, Bumi Holding SAS divest its ownership by 10% to Government of Mauritania to meet Mauritania regulation. Government of Mauritania has an option to get additional 10% ownership. Subject to dilution to 80.0%
Source: Company
Monetizing its mineral assets is imminent, in our view. BRMS has abundant diversified high-quality mineral assets at its subsidiary levels, but most of the projects are still green field. It would take a lot of money to develop them until they start production. We estimate it is very likely that BRMS will partly divest its ownership in its subsidiaries while maintaining its majority stakes in order to unlock its subsidiaries value and develop their projects. We estimate divestment may happen after Gorontalo and Citra Palu have got JORC certifications in 2012 or after Dairi gets exploitation permit.
EXHIBIT 4. PROGRESS FOR EACH PROJECTS
Projects NNT (elang & rinti) Mauritania Dairi Gorontalo Citra Palu Konblo Bumi (Liberia) Effective stake 18% 53% 80% 80% 97% 94% JORC certification Others not yet Expect in 1H12 Obtained exploitation permit in Jan'12 Yes Obtained Principle Agreement for Underground Mining in Nov'11 Yes. Got in December 2010 Expect in 2H12 Yes. Got in September 2011 Expect in 2H12 Yes. Under seven exploration permits not yet Has got exploration permit? Yes. Valid from Sep'10-Feb'30 Yes. Yes. Got in October 2010
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NNT would IPO in 2H12, which would unlock its value and open door for MDB for increasing its stake in NNT NNT has got approval to launch IPO from its shareholders on 19 August 2010. NNT plans to offer 10% in new shares after the divestment of 7% of foreign investors stake in NNT has been settled. NNT had planned to go public in 2011 but as the 7% divestment stalled, the IPO of NNT is being delayed. The 7% was purchased by the Government of Indonesia, but the payment has yet to be paid pending endorsement from the Energy and Mineral Resources Minister and clearance from the BKPM. The divestment process may be completed in 1H12. Therefore, the IPO of NNT may be done in 2H12. The IPO will unlock the value of NNT itself. Soon after IPO, in our view MDB would buy NNTs share in the secondary market in order to increase its stake in NNT to at least 25% in order to get corporate tax saving at MDB level. Potential sizable corporate income tax saving if MDB increases its stake at NNT to at least 25% According to the Indonesian tax regulation, corporate income tax is calculated on company basis, not on consolidated basis. Equity in net income of associated company is not taxable. Meanwhile, dividend receipt from associated company is taxed at corporate income tax rate. However, dividend receipt is not taxable if all three conditions are fulfilled. Currently, the only condition has not been fulfilled by MDB is its ownership in NNT, which is still below 25%. There are several ways for MDB to increase it; 1) purchase the latest 7% divestment of NNT, 2) purchase the stake from Pukuafu Indah or Indonesia Masbaga Investama, 3) purchase in the secondary market after the NNTs IPO. Any of the ways will bring double benefits for MBD: 1) no more tax on equity in NNTs dividend. 2) entitled for higher proportion from NNTs earnings and dividend. At the moment, we think the most possible is a purchase in the secondary market. We have not factored in the corporate tax saving in our model, but based on our scenario analysis there will be sizable corporate tax saving of around Rp424bn in FY13F (62.8% of FY13F consolidated corporate income tax) which should increase FY13F consolidated net income by 333bn (19% and 18% from our base case scenario and consensus estimates, respectively).
EXHIBIT 5. DIVIDEND RECEIPT FROM NNT IS NOT TAXABLE IF MDB INCREASES ITS STAKE AT NNT FROM CURRENT 24% TO AT LEAST 25%
PT NNT (an associate company) Income Statement Revenue Gross profit Operating profit Pretax income Corporate tax (Tax rate= 35%) Net income xxxx xxxx xxxx xxxx xxxx A PT MDB (a subsidiary company) Income Statement Revenue Gross profit Operating profit Equity in associated company's net income Pretax income Corporate tax (Tax rate= 25%) Net income Cash flow Statement Cash Flow from Operation Cash Flow from Investing activities: Dividend received Cash Flow from Financing activities xxxx xxxx xxxx A X 24% xxxx xxxx xxxx
Not taxable
Cash flow Statement Cash Flow from Operating activities Cash Flow from Investing activities: Cash Flow from Financing activities: Dividend paid
xxxx xxxx xxxx B
xxxx xxxx B X 24% xxxx
Taxable at Corporate income tax rate
Dividend received is not taxable if MDB meets all 3 conditions: 1 Dividends received from an Indonesian company by limited liability company incorporated in Indonesia 2 Dividends are paid out of retained earnings 3 Have at least 25% of the paid-in capital in the company distributing dividend Meet the condition? Yes Yes Not yet. We estimate MDB would increase from 24% to at least 25% by buying NNT shares after NNT IPO
Source: Mandiri Sekuritas, Indonesian tax regulation
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EXHIBIT 6. THE BIGGEST COMPONENT OF CORPORATE TAX EXPENSE COMES FROM CORPORATE INCOME TAX ON DIVIDEND RECEIPT FROM NNT. THERE WOULD BE SIZABLE CORPORATE TAX SAVING IF MDB INCREASES ITS STAKE AT NNT TO AT LEAST 25%.
Rp bn % MDB ownership in NNT at end of year INCOME STATEMENT Equity in net income of NNT Consolidated pre tax income CASH FLOW STATEMENT Dividend received from NNT % dividend received from NNT to consol pre tax incom 2009 17% 488 422 2010 24% 2,132 1,422 2011 24% 1,231 953 2012 2013 24% 24% 1,462 1,248 2,615 2,970 Not taxable
0%
1,583 111%
439 46%
522 2,037 42% 69%
Taxable at Corporate tax rate
Base case scenario: MDB's stake in NNT stay at 24%. Dividend received from NNT is taxable Consolidated income tax BRMS only Subsidiaries: Bumi Resources Japan 31 48 52 62 MDB (parent company of NNT) 268 29 41 424 Bumi Mauritania 68 68 Dairi Prima 120 TOTAL Consolidated Income tax 299 77 161 675 Consolidated net income (net of Minority) (0) 765 722 814 1,806
Scenario analisis: If dividend received from MDB is not taxable since 2013 Consolidated income tax MDB (parent company of NNT) TOTAL Consolidated Income tax
268 299
29 77
41 161
251 Increase in Net % Increase Income 2,140 333 19%
Consolidated net income (net of Minority)
(0)
765
722
814
Source: Mandiri Sekuritas
Page 5 of 30
Earnings grow by 2010-2013F CAGR of 33.2% We forecast consolidated net income (net of minority) to grow by a CAGR of 33.2% from Rp765bn in FY10 to Rp1,806bn in FY13F. The main contributors of the growth are: 1) higher equity income from investment in NNT. We estimate NNT gold and coopers production will be back to its 2010 peak level in 2013 as the Phase 6 mine site will start production in 2013, 2) higher earnings contribution from BUMI Mauritania because BUMI Mauritania is in the process to ramp up its production after it starts production in 2012, 3) Dairi Prima will start to generate earnings in 2013, 4) higher sales of Bumi Japan.
EXHIBIT 7. EARNINGS GROW BY 2010-2013F CAGR OF 33.1% COMES FROM HIGHER REVENUE AND EQUITY INCOME
Rp bn
3,000 2,500 2,000 1,500 1,000 500 0 (500) (1,000) (1,500)
2009
2010
2011F
2012F
2013F
Revenue Interest expenses Net Income (net of minority)
Equity in NNT net income Corporate tax
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SWOT Analysis
EXHIBIT 8. SWOT ANALYSIS
Strengths World class, high-quality metal assets Diversified metal exposures Located in various locations Opportunities Potential significant tax saving if MDB able to increase its stake in NNT to at least 25% Substantial revenue streams from new mines Significant upside in reserves and resources from NNT Elang and Rinti
Weaknesses Most of projects are greenfield projects Biggest contributor to net income comes from NNT, meanwhile BRMS does not have control over NNT Threats Regulation risk Delay in projects Increase in costs Lower earnings and dividend received from NNT
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Valuation
Deriving TP: Rp830 per share using conservative SOTP valuation method We initiate our coverage on BRMS with a Buy recommendation with TP: Rp830 per share, which implies PER FY12F, FY13F of 26.1x and 11.8x, respectively. Our Target Price also implies PBV FY12F, FY13F of 1.2x and 1.1x, respectively. BRMS is one of few mineral companies, which are traded below its par value. We use conservative SOTP valuation method to value BRMS share value. We use: 1) DCF method for valuing NNT Batu Hijau, Dairi Anjing Hitam and Bumi Mauritania. 2) Investment cost plus capital expenditure for valuing Gorontalo, Citra Palu and Konblo Bumi. 3) We do not value NNT Elang and Rinti, Dairi Lae Jahe and Base Camp and Bumi Japan. Sizable upside to our valuation on NNT Elang and Rinti, Gorontalo, Citra Palu, Dairi Lae Jahe and Base Camp Our valuation on BRMS is exposed to sizable upside when NNT Elang and Rinti, Gorontalo, Citra Palu, Dairi Lae Jahe and Base Camp is realized. The biggest upside may come from NNT Elang whose reserve is significantly higher than the Batu Hijau mine, according to a preliminary estimate by Newmont Mining Corporation.
EXHIBIT 9. DERIVING TARGET PRICE OF RP830 USING SOTP METHOD
EV (100%) Investments using DCF (book value) US$mn 9,643 606 39 17 236 45 105 80 US$mn Capital expenditure US$mn 18% 18% 80% 80% 97% 53% 94% 100% Effective Stake BRMS' Value US$mn 1,736 485 115 94 126 42 2,598 9,100 23,642 2,309 21,333 25,570 830 560 48.2%
Projects
Valuation Method
NNT - Batu Hijau DCF with WACC = 12.0% and TV growth = 0% NNT - Elang and Rinti Not valued Dairi Prima Minerals DCF with WACC = 12.0% and TV growth = 0% Gorontalo Minerals Investment Cost + Capex Citra Palu Minerals Investment Cost + Capex Bumi Mauritania DCF with WACC = 12.0% and TV growth = 0% Konblo Bumi Inc. (Liberia) Investment Cost + Capex Bumi Resources Japan Not valued
Total BRMS' value, US$mn Forex Total BRMS' value, Rp bn Net Debt - 31 December 2011, Rp bn Equity Value, Rp bn No. of shares (mn) Equity Value per share, Rp Current Share price Potential upside
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EXHIBIT 10. KEY ASSUMPTIONS
Unit Macro Average exchange rate(Rp/US$) NNT Batu Hijau Production volume Gold Copper Sales volume Gold Copper Average Selling Price Gold Copper Cost Applicable to sales Gold Copper Amortization Gold Copper Reclamation and remediation Gold Copper Dividend payout ratio Bumi Mauritania Production volume Iron Sales volume Iron Average Selling Price Iron Cash Cost per unit FOB (US$/ton) Dairi Production volume Ore Zinc Lead Silver Sales volume Zinc Lead Silver Average Selling Price Zinc Lead Silver Cash Cost per unit Mining opex Processing cost Royalties
2009 10,396
2010 9,084
2011F 8,818
2012F 9,101
2013F 9,101
Rp full
('000 oz) (mn lbs) ('000 oz) (mn lbs) (US$/oz) (US$/lbs) (US$/oz) (US$/lbs) (US$/oz) (US$/lbs) (US$/oz) (US$/lbs)
560 494 550 498 1,000 2.59 214 0.62 55 0.16 4.00 0.01 0%
737 542 656 489 1,183 3.45 237 0.69 63 0.19 5.00 0.01 78%
380 320 380 320 1,570 3.50 440 1.10 100 0.22 8.00 0.02 36%
400 350 400 350 1,650 3.55 440 1.10 100 0.22 8.00 0.02 36%
730 540 730 540 1,650 3.55 430 1.05 100 0.23 8.00 0.02 78%
('000 tonnes) ('000 tonnes) (US$/ton)
600 600 115 65
600 600 115 65
('000 tonnes) ('000 tonnes) ('000 tonnes) ('000 oz) ('000 tonnes) ('000 tonnes) ('000 oz) (US$/ton) (US$/ton) (US$/oz) (US$/ton) (US$/ton) (US$/ton)
130 19 10 42 19 10 42 2,200 2,200 30 46 36 21
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Sensitivity analysis
EXHIBIT 11. SENSITIVITY ANALYSIS
Gold price Base case FY12F 1,650 Net Income 879 846 814 782 749 FY12F 3.55 Net Income 936 875 814 753 692 FY12F ('000 oz) 400 (mn lbs) 350 ('000 tons) 600 ('000 tons) Dairi is still not ('000 tons) production ('000 oz) Net Income 10.0% 949 5.0% 882 Base case 814 -5.0% 746 -10.0% 679 FY12F FY13F 1,650 1,915 1,861 1,806 1,752 1,697 FY13F 3.55 1,980 1,893 1,806 1,719 1,632 FY13F 730 540 600 19 10 42 2,048 1,927 1,806 1,685 1,564 FY13F Change (%) 16.6% 13.4% 8.3% 6.7% 0.0% 0.0% -8.3% -6.7% -16.6% -13.4% FY12F FY13F FY12F Change (%) 8.0% 4.0% 0.0% -4.0% -8.0% FY12F Change (%) 15.0% 7.5% 0.0% -7.5% -15.0% FY12F FY13F
(US$/oz) 10.0% 5.0% Base case -5.0% -10.0%
Rpbn
6.0% 3.0% 0.0% -3.0% -6.0% FY13F
Cooper price Base case
(US$/lbs) 10.0% 5.0% Base case -5.0% -10.0%
Rpbn
9.6% 4.8% 0.0% -4.8% -9.6% FY13F
Sales Volume Base case Gold Copper Iron Zinc Lead Silver
Rpbn
Operating expenses Base case NNT: Gold (US$/oz) Copper (US$/lbs) Mauritania: Iron (US$/ton) Dairi: Mining opex (US$/ton) Processing cost (US$/ton) 10.0% 5.0% Base case -5.0% -10.0%
440 1.10 115 not in production Net Income 742 778 814 850 886 FY12F 9,101 Net Income 891 852 814 776 737
430 1.05 115 46 36 1,701 1,753 1,806 1,859 1,911 FY13F 9,101 1,990 1,898 1,806 1,714 1,623 Change (%) -8.8% -4.4% 0.0% 4.4% 8.8% FY12F -5.8% -2.9% 0.0% 2.9% 5.8% FY13F
Rpbn
Average Forex Base case
(Rp/US$) 10.0% 5.0% Base case -5.0% -10.0%
Rpbn
Change (%) 9.4% 10.2% 4.7% 5.1% 0.0% 0.0% -4.7% -5.1% -9.4% -10.2%
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Relative valuations
It is not appropriate to compare BRMS with its peers as there are no peers with relatively similar asset size and portfolio, earnings profile, and project development stages.
EXHIBIT 12. PEERS COMPARISON

PER (x) 2012F 2013F GOLD PEERS NEM US ASR CN ARZ CN CG CN ELD CN IAG US POG LN SMF CN Simple average ANTO LN AVM CN CS CN CUM CN FCX US IMN CN Simple average BRMS IJ NEWMONT MINING CORP ALACER GOLD CORP AURIZON MINES LTD CENTERRA GOLD INC ELDORADO GOLD CORP IAMGOLD CORP PETROPAVLOVSK PLC SEMAFO INC 11.2 12.1 12.1 9.3 16.0 12.4 6.6 12.0 11.5 COPPER PEERS 11.8 8.3 15.3 4.6 10.6 12.3 10.5 17.6 10.5 10.3 10.3 7.6 13.3 9.6 5.7 10.2 9.7 10.9 6.9 13.8 3.7 8.5 10.1 9.0 7.9 1.8 1.8 2.3 2.3 2.2 1.6 1.0 2.5 2.0 2.5 1.4 1.1 2.0 2.4 1.3 1.8 0.8 1.6 1.5 1.8 1.9 2.0 1.4 0.9 2.0 1.6 2.2 1.0 1.0 1.2 2.0 1.1 1.4 0.7 5.9 7.4 4.6 5.5 8.6 5.3 4.8 6.3 6.1 4.8 4.1 5.6 4.8 4.9 5.6 5.0 47.0 5.4 5.0 3.4 4.9 7.5 4.4 4.0 5.2 5.0 4.6 3.3 4.7 3.5 3.9 4.7 4.1 19.0 PBV (x) 2012F 2013F EV/EBITDA (x) 2012F 2013F
TICKER
COMPANY NAME
ANTOFAGASTA PLC ANVIL MINING LTD CAPSTONE MINING CORP COPPER MOUNTAIN MINING CORP FREEPORT-MCMORAN COPPER INMET MINING CORPORATION BUMI RESOURCES MINERALS
Source: Bloomberg, Mandiri Sekuritas
Page 11 of 30
About the company

Company Bumi Resources Minerals (BRMS) is a company in the metal sector holding a portfolio of subsidiaries having operations and exploration prospects in Indonesia as well as in Mauritania and Liberia, Africa. Its core operations are the exploration and development of gold, copper, zinc, lead and molybdenum deposits in Indonesia, iron ore in Mauritania and minerals in Liberia. BRMS has 75.0% stake in Multi Daerah Bersaing (MDB). Meanwhile, MDB owns 24.0% of the shares in NNT, a company whose main asset is the Batu Hijau Mine, the second largest copper-gold mine in Indonesia and Asia in terms of estimated production, according to AMEs estimates. BRMS provide coal and other mineral sales, marketing and consulting services through Bumi Japan, which accounted for all of its current consolidated revenues. Corporate Structure. BRMS was established in 2003 as PT Panorama Timur Abadi, a company in the business of selling lubricant oil. In July 2009, BUMI Resources (BUMI) purchased 99.8% of Panorama from an unrelated third party to hold BUMIs non-coal mining assets, and subsequently changed the name of Panorama to PT Bumi Resources Minerals. After a series of reorganization in the second half of 2009 and in 2010, the Company became the holding company for certain of the minerals and related business operations.
EXHIBIT 13. CORPORATE STRUCTURE
Public 13% PT Bumi Resources Minerals Tbk 99.99% PT Multi Capital 75% PT Multi Daerah Bersaing 99.99% Calipso Investment Pte. Ltd. 80% 100% Herald Resources Ltd. 100% Gain and Win Pte. Ltd. 24% PT Newmont Nusa Tenggara Effective ownership
18.0%
PT Bumi Resources Tbk (BUMI) 87%
20%
100% International Minerals Company LLC
99.99% Lemington Investments Pte. Ltd.
100% Bumi Resources Japan Company Limited
60% Bumi Holding S.A.S 80% PT Sarkea Prima Minerals Effective ownership
100.0%
80% PT Dairi Prima Mineral Effective ownership

80.0%
96.97% PT Citra Palu Minerals Effective ownership

96.97%
89% Bumi Mauritania SA Effective ownership

53.39%
94.1%( Konblo Bumi Inc. (Liberia Project) Effective ownership

94.1%
PT Gorontalo Minerals Effective ownership

80.0%
Legend Investment Holding Companies Operating/Developing companies Marketing Service company (1) (2) (3) Subject to progressive divestment to 49.0 % beginning from the end of the fifth year after commencement of production at the Gorontalo pro In January 2012, Bumi Holding SAS divest its ownership by 10% to Government of Mauritania to meet Mauritania regulation. Government of Mauritania has an option to get additional 10% ownership. Subject to dilution to 80.0%
Source: Company
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Capital Expenditure and source of fund BRMS will spend a total of US$581mn for capital expenditure in FY11F-FY13F for Dairi (US$211mn), Bumi Mauritania(US$140mn), Gorontalo (US$105mn), Citra Palu (US$80mn) and Liberia projects(US$45mn). Meanwhile, capital expenditure of NNT will be funded by NNT itself through various options, such as loans and/or an initial public offering to fund capital expenditures and operations of the Phases 6. Total Capex of US$105mn for the Gorontalo project in FY11F-FY12F is enough only up to exploration and get JORC certification. We estimate total capex could reach around US$1bn for construction and to bring the mine to production.
EXHIBIT 14. CAPITAL EXPENDITURES IN FY11F-FY13F
Mauritania commences DSO Dairi commences production Total= US$275mn 5 50
Total= US$240mn 35
30 35 40
70
50 Total= US$66mn 5
100
100
50 11
2011F Dairi Mauritania
2012F Gorontalo Citra Palu Liberia
2013F
EXHIBIT 15. THE USAGE OF CAPITAL EXPENDITURE

Capex allocation 2011F 2012F 2013F Total The usage of capex For feasibility studies, drilling and other exploration costs, and productions costs in relation to the 600,000 tonnes per annum of direct shipping ore For construction and equipment purchases and to bring the mine to production For exploration, drilling and feasibility studies For feasibility studies and exploration program For exploration activities
US$ mn
Mauritania Dairi Gorontalo Citra Palu Liberia TOTAL
40 100 35 30 35 240
50 100 70 50 5 275
50 11 0 0 5 66
140 211 105 80 45 581
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Operating companies
Newmont Nusa Tenggara
Ownership structure of Newmont Nusa Tenggara Under the Contract of Work in 1986 between the Indonesian government and NNT, 51% of NNTs shares must be divested, first, to the Indonesian government or, second, to Indonesian nationals by March 31, 2010. Currently, the last divestment of 7% of the stake is still in the progress, which Pusat Investasi Pemerintah (PIP) is the buyer of the divestment. MDB, a 75% BRMS owned subsidiary, holds 24% stake in NNT after a series acquisitions.
EXHIBIT 16. OWNERSHIP STRUCTURE OF NEWMONT NUSA TENGGARA AS OF 31 DECEMBER 2010
PT Bumi Resources Minerals Tbk (BRMS)
99.9% Newmont Mining Corp Sumitomo Corp PT Multi Capital
75% 56.25% 43.75% Nusa Tenggara Partnership PT Multi Daerah Bersaing PT Pukuafu Indah PT Indoneia Masbaga Investama
56%
24%
17.8%
2.2%
PT Newmont Nusa Tenggara
Elang Concession
Batu Hijau Concession
Rinti Concession
Source: Company
EXHIBIT 17. BRMS COST OF ACQUISITION NEWMONT NUSA TENGGARA

BRMS' Cost of acquisition NNT Phase 1 Phase 2 Phase 3 Total
% of Stake No of shares 10% 7% 7% 24% 683,407 478,385 478,385 1,640,177
Completed in 16-Nov-09 11-Dec-09 15-Mar-10
Cost (US$mn) 391.0 246.8 246.8 884.6
Implied cost per 1% stake (US$mn) 39.1 35.3 35.3
Page 14 of 30
Newmont Nusa Tenggara Batu Hijau copper and gold mine Batu Hijau is a large scale open pit gold and copper mine located in South-west Sumbawa, Indonesia. Batu Hijau has a large copper/gold deposit, which Newmont Mining Corporation discovered in 1990. Development and construction activities began in 1997 and start-up occurred in late 1999. Contract of Work (third generation) signed with Indonesian Government in 1986. Under the Contract of Work, NNT has the right to continue operating the project for 30 years from operational start-up, or longer if approved by the Indonesian government. One of only three mines in the world with total ore tonnage in excess of 1 billion tonnes and gold grades higher than 0.2g/t. One of the lowest cost gold or copper operations in the world ($ 0.7/ lb copper ; $ 237/ oz gold in 2010) The mine is at an elevation of 450 meters (1,476 feet) above sea level and 25 kilometers (15 miles) from the company-built port in Benete Bay. Ore is mined from the open pit by electric shovels and 240-ton haul trucks. The ore is crushed and conveyed 6.4 kilometers (4 miles) to the concentrator which is capable of processing 140,000 tonnes per day through two grinding mill circuits and five flotation lines. The final concentrate is then pumped to the port, where it is filtered and then shipped to smelters in Asia and Europe. At the end of 2010, Batu Hijau has reserve of 7.7bn lbs of copper and 7.6mn oz of gold. Newmont Mining Corporation estimate there is potential increase in reserves up to ~30%-50% of current gold and copper Reserves over the next decade. Batu Hijaus production is expected to decrease in FY11F and FY12F as it moves into Phase 6 stripping since 2H10, whereas FY13F production volume is expected to be similar to its peak performance in 2010.
EXHIBIT 18. NNT BATU HIJAU GOLD AND COPPER RESERVES
Batu Hijau Gold Reserves 2010 Proved Probable Proved and Probable Tonnage (Ore) 100% 348,500 609,000 957,000 Equity 62,640 109,620 172,260 (000 tons) Grade Gold (oz/ton) 0.014 0.004 0.008 Contained Gold 100% 4,872 2,436 7,656 Equity 877 438 1,378 (000 oz)
Batu Hijau Copper Reserves 2010 Proved Probable Proved and Probable
Tonnage (Ore) 100% 348,500 609,000 957,000 Equity 62,640 109,620 172,260 (000 tons)
Grade Copper (%) 0.50% 0.35% 0.40%
Contained Copper 100% 3,584 4,125 7,709 Equity 645 743 1,388 (mm lbs)
Source: Company
Page 15 of 30
EXHIBIT 19. NNT BATU HIJAU
Source: Newmont 2010 factbook
EXHIBIT 20. LOCATION OF BATU HIJAU, ELANG AND RINTI
Source: Company
Page 16 of 30
Newmont Nusa Tenggara Elang and Rinti Currently, Elang project is a green field project. Elang project represents an opportunity in early-stage development that could eventually exceed the size of current operation at Batu Hijau. Newmont Mining Corporation estimates Elangs potential to be approximately 25 million ounces of gold and 15 billion pounds of copper on a 100% basis a world-class deposit by any measure. NNT has received an exploration permit for Elang that is valid from September 27, 2010 to February 28, 2030. Newmont Mining Corporation forecasts commercial production in Elang mine will start since 2020. The Rinti exploration area is 80 kilometers east of the Batu Hijau Mine and 20 kilometers from the Elang prospect. Further exploration is required to determine the economic potential and to generate a JORC compliant resource statement.
EXHIBIT 21. NNT ELANG MINE PLAN
Source: Newmont Mining Corporation
Dairi
Dairi is a very high grade zinc resource located in North Sumatra and is proposed to be developed as an underground mining operation. Its mining concession is located strategically with respect to smelters and shipping routes. Dairi signed Contract of Work with Indonesian Government in 1998. The Contract of Work has a 30 year term from the commencement of production. A series of permits has been get in order to start production: exploration borrow and use permit in October 2010, Presidential Decree to allow underground mining within protected forest area in May 2011, obtained Principle Agreement for underground mining in Nov 2011. Dairi is one of the highest grade zinc deposits in the world (Grades of 11.5% Zn, 6.8% Pb and 7.5 g/t Ag). Low estimated net by-product cash cost of US$0.21/lb. The JORC standard Reserve and Resource was completed by CSA Global (Australia) in Oct 2010 and Mining Plus Pty.Ltd in Feb 2011.
Page 17 of 30
EXHIBIT 22. DAIRI HAS SIGNIFICANT RESERVES AND RESOURCES

Sites Anjing Hitam Lae Jahe TOTAL RESERVES Sites Anjing Hitam Lae Jahe Base Camp (shale hosted) Base Camp (carbonate hosted) TOTAL RESOURCE
Source: Company
Proven Probable Probable
Combined Reserves 4.95 Mt at 14.8% Zn, 9.1% Pb, 11.5 Ag g/t 0.93 Mt at 11.3% Zn, 7.0% Pb, 10.1 Ag g/t 5.17 Mt at 8.4% Zn, 4.5% Pb, 3.3 Ag g/t 11.05 Mt at 11.5% Zn, 6.8% Pb, 7.5 Ag g/t Combined Minerals Resources 8.11 Mt at 14.6% Zn, 9.1% Pb, and 12 Ag g/t 16.18 Mt at 8.2% Zn, 4.5% Pb 0.49 Mt at 5.5% Zn, 5.7% Pb, and 10 Ag g/t 0.34 Mt at 4.2% Zn, 4.0% Pb, and 20 Ag g/t 25.12 Mt at 10.1% Zn, 6.0% Pb
EXHIBIT 23. DAIRI PROJECT IS LOCATED IN NORTH SUMATRA
Source: Company
Page 18 of 30
Mauritania Currently, active in these two following areas: Tamagot region, south of the town of Akjoujt, and 250 km NorthEast of the capital Nouakchott. Sfariat region, 250 km north of the town of Zouerat in northern Mauritania Two potential producing operations: 1) Direct shipping ore from Tamagot region. 2) Concentrate for pellet feed from Sfariat region DSO production expected to commence in early 2012 Bumi Mauritania got exploitation permit in January 2012.
EXHIBIT 24. BUMI MAURITANIAS RESERVES AND RESOURCES
Tonnage (Ore) 100% (000 tonnes) 100,000
Mineral Inventory Mauritania Project

Source: Company
Mineral Iron
Grade 58%
Metal contain 100% 58,000 MT
EXHIBIT 25. BRMS PERMITS IN MAURITANIA
Source: Company
Page 19 of 30
Gorontalo BRMS has Contract of Work lincense of a 36,070 hectare mining concession located in the Bone Bolango Regency (Province of Gorontalo). BRMS obtained Exploration Borrow & Use Permit in December 2010. Based on explorations to date, the following have been identified in the concession: Four copper and gold systems Three gold, silver and copper systems Four gold and silver systems JORC Resource to be completed by end 2012 with commissioning expected in 2H 2014 Conceptual development model is to build a 25 million tonnes per annum (feed tonnes) copper concentration plant that would be able to process 0.6% of copper and 0.6 grams per tonne of gold material
EXHIBIT 26. GORONTALOS RESERVES AND RESOURCES
Tonnage (Ore) Mineral Inventory Gorontalo Project (000 tonnes) 125,000 100,000 Mineral Gold Copper
Source: Company
Grade 0.55 g/tonne 0.75%
Contained Metal 2.4 mm oz 2,067 mm lbs 1.9 mm oz 1,653 mm lbs
EXHIBIT 27. BRMS HAS COW RIGHTS TO A 36,070 HECTARE MINING CONCESSION LOCATED IN PROVINCE OF GORONTALO
Source: Company
Page 20 of 30
Citra Palu Citra Palu has rights to a 138,889 hectare mining concession in Central Sulawesi and South Sulawesi, Indonesia through a COW Contract area consists of six separate blocks, of which the Poboya Gold Prospect is the most promising. Initial mineral inventory of: Blok 1: 2.5 million tonnes with 7.5 g/t gold Blok IV: 106 million tonnes at 0.14% molybdenum Conducted a baseline study on economic, social, health and environment in preparation for a detailed infill drilling program in 2011 JORC Resource to be completed by end 2012 with commissioning expected in 2H 2014
EXHIBIT 28. CITRA PALUS RESERVES AND RESOURCES
Tonnage (Ore) 100% 2,500 Citra Palu Project 106,000
Source: Company
Mineral
Grade
Contained Metal 100% Equity 0.6 mm oz 7 mm lbs
Equity 2,400 Gold 7.5 g/tonne 0.14%
(000 tonnes) 0.7 mm oz 8 mm lbs
103,000 Molybdenum
EXHIBIT 29. BRMS HAS COW TO A 138,889 HECTARE MINING CONCESSION LOCATED IN CENTRAL AND SOUTH SULAWESI
Source: Company
Page 21 of 30
Konblo Bumi (Liberia) 94.1% ownedbyBRM (Subject to dilution to 80.0%) Significant potential to discover world class diamond and gold deposits Konblo Bumi has seven exploration licenses to explore for gold, diamond and base metals (Two were awarded in 2009, remaining five were awarded in January of 2010) Current focus is on two diamond license areas located northwest of capital Monrovia and east of the town of Kakata Helicopter-borne magnetic survey has been completed Survey located a number of areas that display features strongly indicative of Kimberlite pipes as large as 5 hectares Licenses located in southern Liberia have excellent potential for economic gold discoveries
EXHIBIT 30. KONBLO BUMI (LIBERIA)
Source: Company
Page 22 of 30
Financial Analysis
Income statement analysis
Solid revenue growth at 114% CAGR10-13F We forecast consolidated revenue to grow at 114% CAGR 10-13F from Rp149bn in FY10 to Rp1,449bn in FY13F due to: 1) Bumi Mauritania starts to generate revenue since FY12F. 2) Dairi Primas revenue stream kicks in since FY13F. 3) growth in Bumi Japan revenue.
EXHIBIT 31. CONSOLIDATED REVENUE AND REVENUE COMPOSITION
Rp bn 1,600 1,400 1,200 1,000 800 600 400 200 0 3 2009A 149 2010A 171 2011F 15% 628 628 196 2012F 383% 226 2013F 76% 50.0 40.0 595 30.0 20.0 10.0 (10.0)
4592%
Dairi Prima (LHS) BUMI Japan (LHS)

Source: Company, Mandiri Sekuritas estimates
Bumi Mauritania(LHS) Revenues growth (RHS)
Equity income from NNT is the biggest contributor to consolidated net income up to FY13F. Since NNT was acquired by MDB in 2009, equity income from NNT is the biggest contributor to consolidated net income. We estimate that even after Dairi produces at its normal capacity since FY14F, NNT is still the biggest contributor to consolidated net income. We expect equity income from NNT would decrease in FY11F and FY12F compare to FY10 due to NNT is in the process of development Batu Hijau phase 6 until the end of 2012. We estimate phase 6 starts to produce since FY13F, therefore its sales volume in FY13F would back to reach its peak volume in 2010.
EXHIBIT 32. MAJOR COMPONENTS OF INCOME STATEMENT: EQUITY INCOME FROM NNT IS THE BIGGEST COMPONENT
Rp bn
3,000 2,500 2,000 1,500 1,000 500 0 (500) (1,000) (1,500)
2009
2010
2011F
2012F
2013F
Revenue Interest expenses Net Income (net of minority)
Equity in NNT net income Corporate tax
Page 23 of 30
Effective Corporate Tax rate decrease from 21.0% in FY10 to 8.1% in FY11F and 12.9% in FY12F. Under Indonesian Tax Regulation, corporate income tax is calculated on company basis, not on consolidated basis. Equity income from associate company (in this case is equity income from NNT) is not taxable. Meanwhile, if ownership in associate company is less than 25%, dividend receipt from associate company is taxable at corporate income tax rate. Therefore, if equity income from associate is the biggest contributor to consolidated net income, effective corporate tax rate is determined by dividend payout ratio of the associate company. In BRMS case, the biggest contributor to consolidated pre-tax income is contribution from NNT. We estimate NNT would reduce its dividend payout ratio from 78% in FY10 to 36% in FY11F and FY12F due to NNT need cash to fund the development of phase 6 until the end of 2012. We estimate NNT would increase its dividend payout ratio back to 78% in FY13F due to the phase 6 is expected to start production since FY13F.
EXHIBIT 33. EFFECTIVE CORPORATE TAX RATE DECREASE DUE TO DECREASE IN NNT DIVIDEND PAYOUT RATIO
Rp bn % MDB ownership in NNT at end of year INCOME STATEMENT Equity in net income of NNT Consolidated pre tax income % contribution equity income to consol pre tax income Consolidated Income tax % effective corporate tax rate CASH FLOW STATEMENT Dividend received from NNT % NNT dividend payout ratio % dividend received from NNT to consol pre tax income 2009 17% 488 422 115% 0% 2010 24% 2,132 1,422 150% 299 21.0% 2011 24% 1,231 953 129% 77 8.1% 2012 24% 1,462 1,248 117% 161 12.9% 2013 24% 2,615 2,970 88% 675 22.7%
Not taxable
0% 0%
1,583 78% 111%
439 36% 46%
522 36% 42%
2,037 78% 69%
Taxable at Corporate tax rate
Earnings grows by CAGR10-13F of 33.2%. We estimate consolidated net income (net of minority interest) grow by CAGR10-13F of 33.2% from Rp765bn in FY10 to Rp1,806bn in FY13F. The main drivers of growth are: 1) NNT production in FY13 is back to FY10 level after the development of phase 6 finish at the end of 2012. We expect consolidated net income in FY11F and FY12F lower than FY10 because we expect NNT production decrease during the period. 2) BUMI Mauritania start to generate earning since FY12F 3) Dairis earning kick in since FY13F.
Page 24 of 30
Balance sheet analysis

Healthier balance sheet ahead. The biggest chunk of BRMS debt is loan from Credit Suisse. We estimate BRMS balance sheet would be healthier ahead as BRMS pays its loan from dividend receipt from NNT. We expect net gearing decrease significant in FY13F before becoming net cash in FY14F as we assume NNT increase its dividend payment in FY13F as NNT production increase significant after phase 6 starts to produce since FY13F.
EXHIBIT 34. HEALTHIER BALANCE SHEET AHEAD
Net gearing 20% 13% 10% 2% 0% 7% 19%
-10% -13% -20% 2009

2010
2011F
2012F
2013F
Increasing ROE and ROA would make trading at below par value become unjustified. Currently, BRMS is traded at far below its book value. We think that increasing return on asset (ROA) and return on equity (ROE) would bring justification for BRMS share to be traded above par value. Lower ROA and ROE in FY11F and FY12F compare to FY10 due to lower equity income from NNT in FY11F and FY12F compare to FY10. Higher ROA and ROE in FY13F due to: 1) higher equity income from NNT as its phase 6 start production. 2) Bumi Mauritania starts to generate earning since FY12F. 3) Dairi s earnings kick in since FY13F.
EXHIBIT 35. ROAA AND ROAE
10% 8% 6% 4.3% 4% 2% 0.1% 0% 0.0% -2% 2009
Source: Mandiri Sekuritas estimates
ROAE ROAA
9.3%
9.4% 7.1%
4.2% 3.5%
4.6% 3.5%
2010
2011F
2012F
2013F
Page 25 of 30
Cash flow analysis

Dividend from NNT is the major component of cash inflow. If we do not count one-off cash inflows, such as: IPO proceed and loan, dividend from NNT is the major component of cash inflow until FY13F. Cash flow from operation would remain negative until FY12F and would start to be positive since FY13F.
EXHIBIT 36. DIVIDEND FROM NNT IS THE MAJOR COMPONENT OF CASH INFLOW
Cash flow analysis (Rp bn) Cash at beginning of the year Cash flow from operation Cash flow from investing Dividend from NNT Other Investing cash flows Cash flow from financing Proceed from Dairi divestment Other financing cash flows Cash at end of the year 2009 1 (151) (14,696) (14,696) 14,894 14,894 47 2010 48 (408) (1,371) 1,583 (2,954) 3,644 3,644 1,913 2011F 1,914 (457) (1,739) 439 (2,179) 830 830 547 2012F 547 322 (2,043) 522 (2,565) 1,222 2,166 (945) 48 2013F 48 120 1,374 2,037 (663) (1,085) (1,085) 457
Source: Mandiri Sekuritas estimates
Risk Factors
We identify the flowing risk factors on BRMS: 1. The biggest contributor to consolidated net income and cash flow is NNT, meanwhile BRMS does not have control on NNT. Although dividend from NNT is the main source of BRMS recurring cash inflow, BRMS does not have ability to control NNTs dividend payout ratio. This may force BRMS to look for other source of fund for its operating activities and required minimum dividend of US$4mn per annum to Daerah Maju Bersaing. 2. Commodity price fluctuation. The prices of its commodities fluctuate from time to time. Significant fluctuation from our forecast may generate different net income. 3. Regulation risk. Its exploration and development activities and future mining operations are regulated by the Indonesian Government primarily through the Ministry of Energy and Mineral Resources, as well as the Ministry of Forestry, the State Ministry for Environmental Affairs and the Investment Coordinating Board. Changes in regulations may bring unfavorable impacts on BRMS. 4. Fluctuations in the exchange rate would affect the forecasted net income and dividend received. 5. Increased operating costs could affect its profitability. A material increase in costs at any significant location could have a significant effect on its profitability and operating cash flow.
Page 26 of 30
Appendix 1. Board of commissioners and Board of Directors

Name and Position Saptari Hoedaja President Commissioner Past Experience and Education Director of PT Bakrie & Brothers Tbk (2008 Present) President Commissioner of PT Energi Mega Persada Tbk (2007 Present) President Commissioner of PT Kaltim Prima Coal (2007 Present) President Commissioner of PT Arutmin Indonesia (2007 Present) President Director of BUMI (2001) Degree in Mechanical Engineering of Bandung Institute of Technology (1983) President Director of PT Kaltim Prima Coal and PT Arutmin Indonesia (2007 Present) Commisioner of PT. Bumi Resources Tbk and several Bakrie Group companies (2005 Present) Managing Director of Great Asian Holding Pte. Ltd. and Capital Managers Asia Ltd Bachelors Degree in Commerce from Andhra University in India (1970) Institute of Chartered Accountants of India (CPA) (1976) Honorary Chairman of the Board of Indonesian Institute of Accountants Managing Partner and Chairman of KPMG Indonesia Senior Partner of Kanaka Puradiredja, Suhartono, Office of Public Accountant Chairman of Indonesian Institute of Audit Committee Member of the Honorary Board of the Association of Professionals in Risk Management Vice Chairman of the Indonesian Institute of Commissioners and Directors Degree in Economic (Accounting) at Padjadjaran University, Bandung
Nalinkant A. Rathod Commissioner
Kanaka Puradiredja Independent Commissioner
Page 27 of 30
Name and Position Kenneth P. Farrell President Director
Past Experience and Education Director of Bumi Resources (2003 - Present) Director of IndoCoal Resources and PTNNT Commissioner of Arutmin, KPC, Indocoal Kalsel and Indocoal Kaltim (2007) Management and Executives in BHP Billiton (1980 2001) Graduate in University of Queensland in Engineering (1976) and Commerce degree (1986) Gained Graduate Dip of Company Directorship from the University of New England (1994) Finance Director of Bakrie Energy International Pte. Ltd Finance Director of PT Bakrie & Brothers Tbk (2004 - 2009) lecturer at the Masters Program in Accounting at the University of Indonesia Bachelor degree in Computer Science from University of Indonesia Masters in Management from University of Indonesia (1992) Master of Commerce in Advanced Finance from University of New South Wales, Sydney, Australia (1994) Chief Executive Officer of PT Kaltim Prima Coal Several senior positions in PT Bumi Resources Mining Degree in Mining Engineering from Bandung Institute of Technology Corporate Finance Director of PT Capitalinc Investment (July 2009-June 2010) Assistant Vice President Corporate Finance of PT Recapital Securities Senior Manager of Finance Restyle Concept Finance and Business Development Manager of PT Nusacipta Realtindo Bachelor of General Business from University of Houston President Director of PT. Dairi Prima Minerals (2010 Present) Chief Executive Officer of Herald Resources (2008 Present) Managing Director of Kaltim Prima Coal with PT Bumi Resources (2003 2006) Senior Vice President Project Development di PT Bumi Resources Tbk. Chief Operating Officer of PT Kaltim Prima Coal Manager Mining of Rio Tinto Coal Australia Chief Engineer in Western Engineering Services Kalgoorlie Gold Operations and Windarra 7 years experience in finance and Investor Relations within upstream oil & gas industries Corporate Banker in ABN Amro (Global Corporate Group) and Citibank (Financial Institutions & Public Sector) (1998 2003) Director of PT Multi Daerah Bersaing Senior Legal Officer of PT Arutmin Indonesia for 5 years Expert in Indonesian mining law
Yuanita Rohali Director
Endang Ruchijat Director
Febriansyah Marzuki Independent Director
Evan Ball CEO Dairi Prima Minerals
Herwin Wahyu Hidayat Head of Investor Relations
Mohammad Sulthon Corporate Secretary / Chief Legal Officer
Page 28 of 30
Bumi Resources Minerals

Profit and loss YE Dec (Rp bn) Revenue Gross profit Operating profit EBITDA Net Interest Interest expense Interest income Forex losses/gains Net other Pre-tax profit Income tax Others Minority interests Net Profit 2009A 18 4 0 3 (100) 0 35 487 422 (0) (313) (110) (0) 2010A 149 149 108 118 (1,082) 7 171 2,217 1,422 (299) (36) (322) 765 2011F 171 171 76 95 (392) (478) 86 38 1,231 953 (77) 0 (154) 722 2012F 824 824 377 398 (591) (612) 21 0 1,462 1,248 (161) 0 (273) 814 2013F 1,449 1,449 874 896 (519) (537) 18 0 2,615 2,970 (675) 0 (489) 1,806
Current liabilities Acc. payable ST borrowings Others Long-term liabilities 42 26 0 16 15,413 75 15,338 15,455 295 20 79 196 2,648 2,182 466 2,943 330 23 82 225 3,357 2,774 583 3,687 1,219 110 21 1,087 4,403 3,617 786 5,622 2,105 194 0 1,911 2,887 1,943 944 4,992 Balance sheet YE Dec (Rp bn) Cash and ST Investment (incl. cash equiv) Acc receivable Inventory Others Current assets Investments Fixed assets Others Total assets 2009A 48 1 0 3 52 0 887 14,301 2010A 1,914 0 0 68 1,982 0 909 17,205 2011F 547 0 0 68 615 0 952 20,113 2012F 48 0 0 68 115 0 994 23,556 2013F 457 0 0 68 525 0 1,035 24,735
(100) (1,074)
15,239 20,096 21,681 24,666 26,295
Cashflow statement YE Dec (Rp bn) Operating Profit Other recurring income / (expenses) Depr & Amort Tax Change in working capita Other operating cash flow Operating Cash Flow Capital expenditure Free Cash Flow Other investing cash flow Cash Flow From Investing Net change in debts Equity funds raised Other financing cash flow Cash Flow From Financing Non-recurring income (expenses) Net change in cash Cash at beginning Cash at End 2009A 0 (101) 3 (0) 38 (192) (8,664) 2010A 108 (990) 10 (299) 110 (1,292) (388) 2011F 76 (392) 19 (77) 32 (1,231) (2,116) 2012F 377 (591) 20 (161) 950 (1,462) (2,503) 2013F 874 (519) 22 (675) 908 (2,615) (601)
Long-term payable Others Total liabilities Shareholder's equity
(216) 17,153 17,993 19,044 21,303
Key ratios YE Dec Growth (% yoy) Sales EBIT EBITDA Net Profit Profitability (%) Gross Profit Margin Oper. Margin EBITDA Margin Net Margin ROAA ROAE Leverage Net debt/equity (%) EBITDA/Gross Interest (X) Per share data (Rp) EPS CFPS BVPS (253) 2,855 (384,555) 60 60 1,303 28 29 682 32 33 714 71 71 785 n/a n/a n/a 0.0 24.4 0.7 15.1 (1.2) (0.0) 0.1 (12.6) 0.0 730.4 4,270.7 N.A. 0.0 100.0 72.9 79.7 514.9 4.3 9.3 2.0 0.1 15.0 (30.0) (19.9) (5.5) 0.0 100.0 44.3 55.5 423.0 3.5 4.2 12.8 0.2 382.7 398.6 319.8 12.7 0.0 100.0 45.8 48.3 98.7 3.5 4.6 18.9 0.6 75.8 131.5 125.1 121.9 0.0 100.0 60.3 61.8 124.6 7.1 9.4 7.0 1.7 n/a 89,003.6 2009A 2010A 2011F 2012F 2013F
(362) (2,675) (1,727) (1,140) (2,495)
(9,026) (3,062) (3,843) (3,642) (3,096) (6,032) (984) 377 459 1,975 1,374 (1,695) 0 610 (1,085) 2,615 409 48 457
(14,696) (1,371) (1,739) (2,043) 75 0 14,820 14,895 523 47 1 48 2,187 11,267 (9,808) 3,645 2,303 1,866 48 1,914 595 0 235 830 1,269 (1,367) 1,914 547 782 0 440 1,222 1,462 (500) 547 48
Valuation YE Dec PER (x) EV/EBITDA (X) P/BV (X) P/CF (X) Dividend Yield (%) 2009A (2.2) 48.7 (0.0) 0.2 2010A 9.4 67.3 0.4 9.3 2011F 19.8 181.3 0.8 19.3 2012F 17.6 47.0 0.8 17.2 2013F 7.9 19.0 0.7 7.8 -
DPS
Page 29 of 30
Mandiri Sekuritas A subsidiary of PT Bank Mandiri (Persero) Tbk Plaza Mandiri 28th Floor, Jl. Jend. Gatot Subroto Kav. 36 - 38, Jakarta 12190, Indonesia General: +62 21 526 3445, Fax : +62 21 527 5711 (Equity Research), +62 21 527 5374 (Equity Sales)
RESEARCH
Verdi Budiman Adrian Joezer Hariyanto Wijaya, CPA, CFA Herman Koeswanto Kresna Hutabarat Maria Renata Octavius Oky Prakarsa Raditya Christian Artono Villya Christin Purba Aldian Taloputra Leo Putra Rinaldy Rafdi Prima Wisnu Trihatmojo Head of Equity Research Strategy, Banking Automotive, Consumer, Retail Conglomerate, Plantation, Heavy eq. Mining, Metals Banking Automotive, Construction, Toll road Oil & gas, Telecommunication Chemical Economist Economist Technical Analyst Research Assistant adrian.joezer@mandirisek.co.id hariyanto.wijaya@mandirisek.co.id herman.koeswanto@mandirisek.co.id kresna.hutabarat@mandirisek.co.id maria.renata@mandirisek.co.id raditya.artono@mandirisek.co.id villya.purba@mandirisek.co.id aldian.taloputra@mandirisek.co.id leo.rinaldy@mandirisek.co.id rafdi.prima@mandirisek.co.id wisnu.trihatmojo@mandirisek.co.id +6221 5296 9549 +6221 5296 9553 +6221 5296 9543 +6221 5296 9548 +6221 5296 9546 +6221 5296 9547 +6221 5296 9569 +6221 5296 9638 +6221 5296 9572 +6221 5296 9406 +6221 5296 9551 +6221 5296 9544 verdi.budiman@mandirisek.co.id +6221 5296 9542
Building material, Consumer, Property octavius.prakarsa@mandirisek.co.id
INSTITUTIONAL SALES
Lokman Lie Silva Halim Reinald Wangsanata Oos Rosadi Vera Ongyono Arvita Utami Ananda Andrew Handaya Zahra Aldila Niode Kusnadi Widjaja Edwin Setiadi Henry Sidarta Head of Sales, Trading & Dealing Head of Equity Sales Institutional Sales Institutional Sales Institutional Sales Institutional Sales Institutional Sales Institutional Sales Equity Dealing Equity Dealing Equity Dealing lokman.lie@mandirisek.co.id silva.halim@mandirisek.co.id Reinald.wangsanata@mandirisek.co.id oos.rosadi@mandirisek.co.id vera.ongyono@mandirisek.co.id arvita.ananda@mandirisek.co.id andrew.handaya@mandirisek.co.id zahra.niode@mandirisek.co.id kusnadi.widjaja@mandirisek.co.id edwin.setiadi@mandirisek.co.id henry.sidarta@mandirisek.co.id +6221 527 5375 +6221 527 5375 +6221 527 5375 +6221 527 5375 +62 21 527 5375 +62 21 527 5375 +62 21 527 5375 +62 21 527 5375 +6221 527 5375 +62 21 527 5375 +62 21 527 5375
RETAIL SALES
Marhaendra Yohanes Triyanto Hendra Riady Meta Rama Prilyandari Boy Triono Mochamad Jamil Irawan Endro Surono Ruwie Jakarta Branch Kelapa Gading Branch Mangga Dua Branch Pondok Indah Branch Bandung Branch Banjarmasin Branch Malang & Surabaya Branch Medan Branch marhaendra@mandirisek.co.id Yohanes.triyanto@mandirisek.co.id hendra.riady@mandirisek.co.id meta.prilyandari@mandirisek.co.id boy.triyono@mandirisek.co.id m.jamil@mandirisek.co.id irawan.es@mandirisek.co.id ruwie@mandirisek.co.id +6221 5296 9491 +6221 45845355 +6221 6230 2333 +6221 75818837 +6222 2510738 +62511 442 4020 +6231 535 7218 +6261 457 1116
INVESTMENT RATINGS: Indicators of expected total return (price appreciation plus dividend yield) within the 12-month period from the date of the the last published report, are: Buy (10% or higher), Neutral (-10% to10%) and Sell (-10% or lower). DISCLAIMER: This report is issued by PT. Mandiri Sekuritas, a member of the Indonesia Stock Exchanges (IDX). Although the contents of this document may represent the opinion of PT. Mandiri Sekuritas, deriving its judgement from materials and sources believed to be reliable, PT. Mandiri Sekuritas or any other company in the Mandiri Group cannot guarantee its accuracy and completeness. PT. Mandiri Sekuritas or any other company in the Mandiri Group may be involved in transactions contrary to any opinion herein to make markets, or have positions in the securities recommended herein. PT. Mandiri Sekuritas or any other company in the Mandiri Group may seek or will seek investment banking or other business relationships with the companies in this report. For further information please contact our number 62-21-5263445 or fax 62-21-5275711. ANALYSTS CERTIFICATION: Each contributor to this report hereby certifies that all the views expressed accurately reflect his or her views about the companies, securities and all pertinent variables. It is also certified that the views and recommendations contained in this report are not and will not be influenced by any part or all of his or her compensation.

BRMS Initiating Cov 01FebJan12editedMS

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Initiating Coverage | 01 February 2012

Initiating Coverage | 01 February 2011

Bumi Resources Minerals

MS est. vs Consensus (%) (16.1)

Share price performance

Source: Company, Mandiri Sekuritas

Please see important disclosure at the back of this report

Initiating Coverage | 01 February 2012

EXHIBIT 2. MINERAL ASSET PORTFOLIO AT VARIOUS LEVEL OF DEVELOPMENT CYCLE

Please see important disclosure at the back of this report

Initiating Coverage | 01 February 2012

EXHIBIT 3. BRMS HAS VARIOUS MINERAL ASSETS AT ITS SUBSIDIARIES LEVEL

PT Bumi Resources Tbk (BUMI)

PT Bumi Resources Minerals Tbk

Calipso Investment Pte. Ltd.

International Minerals Company LLC

Lemington Investments Pte. Ltd.

Bumi Resources Japan

PT Multi Daerah Bersaing

Herald Resources Ltd.

Gain and Win Pte. Ltd.

Bumi Holding S.A.S

PT Newmont Nusa Tenggara

PT Dairi Prima Mineral

PT Sarkea Prima Minerals

PT Citra Palu Minerals

Konblo Bumi Inc. (Liberia Project)

Source: Company, Mandiri Sekuritas

Please see important disclosure at the back of this report

Initiating Coverage | 01 February 2012

xxxx xxxx xxxx B

xxxx xxxx B X 24% xxxx

Taxable at Corporate income tax rate

Source: Mandiri Sekuritas, Indonesian tax regulation

Please see important disclosure at the back of this report

Initiating Coverage | 01 February 2012

522 2,037 42% 69%

Taxable at Corporate tax rate

251 Increase in Net % Increase Income 2,140 333 19%

Consolidated net income (net of Minority)

Source: Mandiri Sekuritas

Please see important disclosure at the back of this report

Initiating Coverage | 01 February 2012

Revenue Interest expenses Net Income (net of minority)

Equity in NNT net income Corporate tax

Source: Mandiri Sekuritas

Please see important disclosure at the back of this report

Initiating Coverage | 01 February 2012

Source: Mandiri Sekuritas

Please see important disclosure at the back of this report

Initiating Coverage | 01 February 2012

Source: Mandiri Sekuritas

Please see important disclosure at the back of this report

Initiating Coverage | 01 February 2012

EXHIBIT 10. KEY ASSUMPTIONS

('000 tonnes) ('000 tonnes) (US$/ton)

600 600 115 65

600 600 115 65

130 19 10 42 19 10 42 2,200 2,200 30 46 36 21

Please see important disclosure at the back of this report

Initiating Coverage | 01 February 2012

(US$/oz) 10.0% 5.0% Base case -5.0% -10.0%

6.0% 3.0% 0.0% -3.0% -6.0% FY13F