#1A Archi Indonesia PT Archi Indonesia Tbk (IDX: ARCI) Earnings Call-1H22 Published date: 5 August 2022 E#2Disclaimer IMPORTANT: You must read the following before continuing. In accessing the presentation (this "presentation"), you agree to be bound by the following terms and conditions. The materials in this presentation have been prepared by PT Archi Indonesia Tbk (the "Company" or "Archi") and are general background information about Archi's consolidated business performances as at the date of this presentation and are subject to change without prior notice. This information is given in summary form and does not purport to be complete. Information in this presentation, including if there is any forecast on operational/financial information, should not be considered as advice or a recommendation to investors or potential investors in relation to holding, purchasing or selling securities or other financial products or instruments, as well as does not take into account their particular investment objectives, financial situation or needs. Before acting on any information, readers should consider the appropriateness of the information having regard to these matters, any relevant offer document and in particular, readers should seek independent financial advice. This presentation may contains certain non-GAAP measures, including All in Sustaining Costs ("AISC") and Earnings Before Interests Tax Depreciation and Amortization ("EBITDA"), that are not audited, not included in the Company's audited financial statements and not presented in accordance with Indonesian Financial Accounting Standards. The measures have been used by management as a supplemental measure of the Company's performance. Although these measures are either contained in or fully reconcilable to line items on the Company's financial statements and/or based on management accounts, they may not be equivalent to similarly named measures used by other companies, and should not be considered as a measure comparable to income statement items for the year in the financial statements. This presentation may contain certain statistical data and analyses (the "Statistical Information") which have been prepared in reliance upon information furnished by the Company and/or third party sources for which the Company has either obtained or is in the process of obtaining the necessary consents for use. Numerous assumptions were used in preparing the Statistical Information, which assumptions may or may not appear herein. As such, no assurance can be given as to the Statistical Information's accuracy, appropriateness or completeness in any particular context, nor as to whether the Statistical Information and/or the assumptions upon which they are based reflect present market conditions or future market performance. Moreover, any information from third party sources contained in these materials may not be used or relied upon by any other party, or for any other purpose, and may not, directly or indirectly, be reproduced, disseminated or quoted without the prior written consent of such third party. This presentation may contain forward looking statements including statements regarding our intent, belief or current expectations with respect to Archi businesses and operations, market conditions, results of operation and financial condition, capital adequacy, specific provisions and risk management practices. Readers are cautioned not to place undue reliance on these forward-looking statements; past performance is not a reliable indication of future performance. The Company does not undertake any obligation to publicly release the result of any revisions to these forward-looking statements to reflect events or circumstances after the date hereof to reflect the occurrence of unanticipated events. The Company disclaims any responsibility or liability whatsoever arising which may be brought or suffered by any person as a result of acting in reliance upon the whole or any part of the contents of this report and neither Archi and/or its affiliated companies and/or their respective employees and/or agents accepts liability for any errors, omissions, negligent or otherwise, in this report and any inaccuracy herein or omission here from which might otherwise arise. 2#3Asset Overview Asset / Project Operating Companies Location Toka Tindung Gold Mine PT Meares Soputan Mining ("PT MSM") & PT Tambang Tondano Nusajaya ("PT TTN"); both are wholly-owned subsidiaries of PT Archi Indonesia Tbk North Sulawesi, Indonesia Mineral Resources 5.5 Moz (as of end 2020) 3.9 Moz (as of end 2020) Ore Reserves Contract of Work Contract of Works ("CoWs"), expires on 2041 (extendable as IUPK for another 2x10 years) Mine Life c. 21 years with expansion (as of end 2021) Mining Method Open Pit (with future prospect of underground mining) Operation History Commenced mining operations in 2009, first gold pour in 2011 • 4.0 Mtpa (as of end 2021) Processing Plant Capacity Carbon in Leach (CIL) Source: Company Information Head Office Jakarta Toka Tindung Gold Mine Mapanget Likupang Barat COW of PT TTN WESTERN CORRIDOR COW of PT MSM Likupang Selatan Likupang Timur Marawuwung Toka Tindung Araren Blambangan Kopra Talawaan EASTERN CORRIDOR Minahasa Utara Ranowulu Alaskar 3#4Key Highlights – 1H22 1 2 3 4 5 6 Ore processed reached 1.82 Mt, 4% higher compared to 1.75 Mt in the same period last year. While the average gold head grade of ore processed was 1.10 g/t, 35% lower compared to the same period last year of 1.70 g/t. As a resulted, gold production was 29% lower at 58.3 koz compared to 81.6 koz in the same period last year. Consolidated revenue reached US$119.6 million, 16% lower compared to the same period last year of US$142.4 million. This was mainly due to the 18% lower gold sold volume to 62.5 koz compared to 76.1 koz in the same period last year. EBITDA reached US$49.3 million, 35% lower than the same period last year of US$75.5 million. Furthermore, the Company's net profit reached US$14.1 million, 57% lower compared to the same period last year of US$32.6 million. Total net debt was at US$313.7 million at 30 June 2022, thus, the Company's debt to equity ratio ("DER") as of 30 June 2022 was 1.3x. Capex realized amounted to US$32.2 million during the period, mainly for development activities of mining infrastructure, tailing storage facility and pit remediation post natural disasters. Remediation process for pit affected by natural disasters is still on progress align with the Company's plan/targets, and is expected to start the production by the fourth quarter of 2022. The Company successfully maintained operational safety with current LTI free hours were 10.5 million hours#5Mining, Processing & Production Lower gold produced mainly due lower average gold head grade The Company has optimized mining activities of 3 (three) mining pits and processed high grade ore to maintain operational performances. Stripping ratio was significantly lower at 3.2x compared to 10.2x in the same period last year, led to higher total ore mined during the period to 2.5 mn tons from 1.9 mn tons in the same period last year. The Company was able to process higher volume of ore at 1.82 mn tons supported by the completion of increased mill capacity, but at lower average gold head grade at 1.10 g/t, resulting in lower gold produced of 58 koz compared to 82 koz in the same period last year. Source: Company Information Toka Tindung Operational Data UOM FY2020 FY 2021 H1 2021 H12022 Ore Mined mn tons 5.0 4.6 1.9 2.5 Waste Mined mn tons 18.6 41.1 19.5 7.9 Material Mined mn tons 23.6 45.7 21.4 10.4 Stripping Ratio X 3.7 9.0 10.2 3.2 Ore Processed mn tons 3.44 3.64 1.75 1.82 Avg. Gold Head Grade g/t 2.12 1.93 1.70 1.10 Gold Recovery Rate % 87.7 87.0 87.2 86.2 Gold Produced koz 206.8 194.4 81.6 58.3 Gold Sold koz 213.8 188.1 76.1 62.5 5#6Exploration Updates Throughout the first six months of 2022, Archi continued doing exploration activities, both in the Eastern and Western Corridor, in order to discover new Mineral Resources and Ore Reserves. Exploration activities carried out by the Company, through its subsidiaries PT MSM and PT TTN, for the year were focused on increasing the potential additional discoveries of the current open pit operations in the Eastern Corridor area and gold resource drillings in Western Corridor area. During the period, the Company had undertaken a total of 36 Diamond Drill ("DD”) holes, represents almost 8,754 drilling meters, with the total cost for exploration activities carried out amounted to US$2.5 mn. There were several significant exploration results in the Western Corridor which are suitable for future underground project. @8.0m, Au 17.8 g/t and Ag 17.9 g/t, including @2.1m, Au 45.6 g/t and Ag 29.7 g/t. @14.9m, Au 9.55 g/t and Ag 7.1 g/t, including @2.4m, Au 46.6 g/t and Ag 33.6 g/t. @5.4m, Au 2.9 g/t and Ag 3.1 g/t, including @1.9m, Au 6.2 g/t and Ag 5.5 g/t. The initial exploration drilling of geothermal project has been carried out in July 2022 (Archi in collaboration with PT Ormat Geothermal Indonesia) Chase ViẬT, LOHN: Bu Source: Company Information BIMA DM Au Grade 4.1.49 1.00 MZR ARJUNA Pyroclastic unit DD22TAL0106 4.60 m @ 0.64 g/t Au, From 122.0 mdh DD22TAL0186: 14.90 m 9.55 g Au, From 142.50 mdh out PT.TTN Wecoo Project DH Scotions DD2ZTAL0186 Arjuna Vein Looking North West 6.00 o 10.00 1888 Soole 1.1:900 20m Тоск#7Consolidated Profit & Loss Statement - 1H22 Selected Key Items For the period ended 30st June In US$ million, unless stated otherwise 2022 2021 % chg Revenue 119.6 142.4 (16.0) Cost of goods sold (79.2) (81.8) Gross profit 40.4 60.6 (3.2) (33.3) Selling, general & administrative expenses (6.1) (4.4) 38.6 Other income / (expenses) (2.9) 6.1 (147.5) Income from Operations 31.4 55.5 (43.4) Finance income / (costs) (8.5) (10.9) (22.0) Share in profit of associates 0.5 0.5 0.0 Profit before income tax expenses 23.4 51.8 (54.8) Income tax expenses (9.4) (19.2) (51.0) Net profit 14.1 32.6 (56.7) EBITDA (1) 49.3 75.5 (34.7) Note: Lower revenue and profitability as a result from lower gold sales volume Archi's consolidated revenue reached US$119.6 mn, 16% lower compared to the same period last year of US$142.4 mn. This decrease was mainly due to a decrease in gold sold volume from 76.1 koz to 62.5 koz. Archi's EBITDA reached US$49.3 mn, 35% lower compared to the same period last year of US$75.5 mn. This decrease was mainly due to a decrease in gold sold volume as well as addition remediation expenses of pit post natural disaster incident. Overall, Archi's net profit was US$14.1 mn, 57% lower compared to the same period last year of US$32.6 mn. The financial results for the six-month' period ended 30th June 2022 and 2021 have been prepared in accordance with Indonesian Financial Accounting Standards and are unaudited. (1) EBITDA refers to profit for the year before finance costs/income, income tax expense, depreciation and amortization. 7#8Consolidated Statement of Financial Position - 30th June 2022 Selected Key Items In US$ million, unless stated otherwise As at As at Maintain debt to equity ("DER") level % chg 30th Jun 2022 31st Dec 2021 Cash and cash equivalents (1) 12.4 12.3 0.8) Inventories - current 38.0 39.1 (2.8) Total current assets 87.2 79.2 10.1 Inventories - non current 105.7 101.7 3.9 Fixed assets 161.9 149.2 8.5 Mine properties 276.5 273.1 1.2 Exploration and evaluation assets 56.5 57.7 (1.7) Increase in short term bank loans due to additional of working capital loan in June 2022 Total net debt as of June 2022 was US$313.7 mn, reflected debt to equity ("DER") ratio at 1.3x. The Company has amended some clauses in loan agreement which was related to repayment schedule. Total assets 710.7 689.7 3.0 Short-term bank loans 62.6 34.2 83.0 Trade payables 52.6 41.7 26.1 Current maturities of long-term liabilities 2.2 68.4 (96.8) Total current liabilities 158.9 201.4 (21.1) Long-term non-current liabilities 250.3 201.2 24.4 Total liabilities 463.8 457.1 1.4 Retained earnings 136.3 121.8 11.9 Total equity 246.9 232.6 6.1 Note: The financial position as at 30th June 2022 have been prepared in accordance with Indonesian Financial Accounting Standards and are unaudited. The financial position as at 31st December 2021 has been prepared in accordance with Indonesian Financial Accounting Standards and audited in accordance with the auditing standards established by the Indonesian Institute of Certified Public Accountants (1) Cash and cash equivalents were excluding restricted cash in relation to Debt Service. (2) Net Debt is calculated as the total balance of interest bearing debt reduced by current restricted cash in relation to Debt Service. 8#9Consolidated Statement of Cash Flow - 1H22 Selected Key Items In US$ million, unless stated otherwise For the period ended 30th June Sustainable 2022 2021 chg Net cash flows provided from operating activities 16.6 64.4 (74.2) Net cash flows used for investing activities (32.2) (75.7) (57.4) Net cash flows used for financing activities 16.1 12.7 26.7 Net (decrease) / increase in cash & cash equivalents Net effect of foreign exchange rate changes 0.55 (23.9) 102.3 Cash on hand and in banks at the beginning of the period Cash on hand and in banks at the end of the period 12.3 40.19 (69.3) 12.4 16.1 (22.9) cash flows to expenditures requirements support capital I Net cash flows provided from operating activities was US$16.6 mn for the period, primarily represents cash receipts from customers of US$123.2 mn and payment to contractors, suppliers and others of US$71.0 mn. Net cash flows used for investing activities was US$32.2 mn, represents capex spending during the period. Net cash flows received from financing activities was US$16.1 million for the period, primarily represents additional working capital loans of US$28.5 million and repayment of long-term bank loans amounted to US$17.5 million. Note: The financial results for the six-month' period ended 30th June 2022 and 2021 have been prepared in accordance with Indonesian Financial Accounting Standards and are unaudited. 9#10Long-term Debt Repayment Schedule Existing Long-term Debt Conventional Facility and MMQ (excl. amortized costs) Repayment Schedule (US$ Mn) Note: Outstanding Balance (as at 30th June 2022) Interest Rate Tenor (Years) Maturity Date US$255.6mn 19 35 55 LIBOR / JIBOR + 4.00% (1) 5.0 2025 80 68 151 400 273 254 220 151 2020 2021 Conventional Facility & MMQ (end of year) 2022 2023 2024 2025 Repayment Schedule (1) Project life coverage ratio = Remaining free cash flow up to Life of Mine (LOM) + ending cash balance for the period) / net debt. (2) Ratio is based on JORC Compliant Ore Reserves / Ore reserves at the Maturity date up LOM. 10 10#11Latest Conditions in Araren Pit Pit wall remediation on progress (in April, ESDM has allowed the Company to access Araren for pit remediation for the purpose of mining activities preparation). Araren river has been diverted Road relocation → currently used temporary road. Fully operations for remediation work at the bottom of the pit. Pit condition prior to Occurrence Water Level : -2.760 RLM Volume : 2.9 million m3 Pit condition post to Occurrence Araren pit is expected to start the production by Q4 2022 Pit condition per July 2022 11#12Business Prospects ☐ Considering the natural disaster incident which affected Araren pit, the Company expects that gold production for this year will be reduced by approximately 25% compared to 2021, and impacted financial performance accordingly. The Company is currently studying underground mining development opportunities, which currently are in feasibility study. The Company believes that underground mining can boost gold production and furthermore improve profitability margin for years to come. 12#13Archi Indonesia Q & A Session#14Archi Indonesia Appendix#15Business Overview Exploration Mining Mine Planning Grade Control Drill & Blast Load & Haul Processing Processing Plant 00 Refining - - Based on latest JORC Report: Ore Reserve 2020 (Gold: 3.9 Moz | Silver: 8.1 Moz) Mineral Resources 2020 (Gold: 5.5 Moz | Silver: 11.0 Moz) Total exploration capital expenditure US$134mn (PTD 2021) Average cost of ore reserves discovery: US$24/oz Mining at site is undertaken by mining contractors using conventional commercial-scale open pit mining methods with low mining costs. Archi is responsible for the mining plan and overall management. Recently replaced 40-ton fleet with 100-ton fleet to accommodate bigger operation and further reduce transportation costs. Gold Dore Process utilizes a standard Carbon in Leach design. Its tailings storage facility has sufficient capacity to support its operations. The final product of processing operations is Dore bars which consist of approximately 30% to 45% gold, and 55% to 70% silver. Continually expand mill capacity from 1.7 Mtpa in 2011 to 4.0 Mtpa in Q2 2021 with further expansion opportunities. Gold Granule sent to The dore bars are Refinery company which to be refined into granule (Au 99.99% and Ag ~ 99.95%). - Buyer collects the product from refinery company by using transporter (ex-work). Buyers/ Cash Received Note: Company Information Established exploration, mining and processing activities with no fatality incidents 15#16Historical Operational Trend Waste Mined ('000 tonnes) 13,766 15,488 14,808 15,256 15,082 Ore Mined 13.5x 11.3x 41,114 10.7x 9.0x 6.4x 5.6x 5.2x 4.4x 6.8x 4.4x 3.7x 3.2x 27,417 23,879 21,828 18,569 15,484 5,025 4,590 7,872 2,744 2,858 3,441 3,212 3,482 2,346 2,552 2,453 1,774 1,219 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 1H22 Ore Processed 2011 2012 2013 2014 2015 2016 2017 Ore mined ('000 tonnes) 2018 2019 2020 2021 1H22 Strip ratio (x) Gold Produced 4.1 4.1 4.1 92.0% 2.5 2.6 2.6 2.4 2.8 2.7 2.1 1.9 90.3% 90.8% 90.9% 92.7% 92.0% 1.1 88.5% 88.0% 89.3% 87.7% 87.0% 86.2% 3,304 3,437 3,638 270 251 261 225 1,738 1,924 2,102 1,997 1,880 2,160 2,350 207 194 1,817 149 168 134 147 877 61 58 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 1H22 2011 2012 2013 2014 2015 2016 2017 Ore processed ('000 tonnes) Head grade for Au (g/t) O Gold production (koz) Source: Company Information 2018 2019 2020 2021 1H22 Recovery rate (%) 16#17Shareholding Structure IPO Completion on 28th June 2021 Public Note: 0.50% 99.50% Archipelago Resources PTE LTD 99.50% 100.00% 0.50% PT Meares Soputan Mining (MSM) PT Tambang Tondano Nusajaya (TTN) Toka Tindung Gold Mine CoW Concession Holders RAJAWALI CORP 84.99% 15.00% Archi Indonesia 99.96% 0.01% 99.99% 99.99% PT Wijaya Anugrah Cemerlang 51.00% PT Jasa Pertambangan Perkasa (JPP) (1) PT Karya Kreasi Mulia (2) (KKM) PT Elang Mulia Abadi Sempurna (3) (EMAS) 25.00% PT Geopersada Mulia Abadi (GMA) (1) Holding company of mining services, which holds 25.00% of PT GMA, our mining contractor. (2) Commenced operations in 2018, providing general management and support services in the areas of tax, legal and accounting exclusively for Archi, PT MSM and PT TTN. (3) A joint venture company incorporated in April 2019 to produce minted gold bars for which Archi holds 51.0%. 17#18ESG Commitment Archi will make continuous efforts on sustainable operations and strive to maintain its position as an ESG leader, as recognized by various industry bodies and the Indonesian government. Soil and Mine Management Progressive reclamation of mine sites Manage and minimize environmental impact Erosion and sedimentation control Community Relationship Maintain a strong relationship with the local communities Continue to be a major employer to the local residents Environmental Baseline and Monitoring Re-vegetation with the mine closure model approach Optimize the use of water resources Reduce greenhouse gas emissions and conventional emissions ESG Social Programs Infrastructural programs including village development Educational programs including scholarships, STEM training and apprenticeships Safety management New business programs Improving Mining Practices Optimize way to operate mines by adopting model practices from other established mine sites around the world Other Key Community Initiatives "Clean Water Project" Animal husbandry projects Healthcare programs including COVID-19 control Source: Company Information. 18#19Occupational, Health & Safety Measures Improved safety & risk controls helping to reduce higher potential injuries to the workforce Health & Safety Statistics 2019 2020 2021 1H2022 Incident Frequency Rate 17.33 15.69 13.11 3.12 Lost Time Injury ("LTI") 0 3 0 0 LTI Frequency Rate 0 0.57 0 0 Medically Treated Injury ("MTI") 8 16 4 LTI Free Hours 10,467,875 hours (since 29th Dec 2020) Record Man-hours without LTI 22,130,456 hours (Jul 2011 - Sep 2016) Management, employees, contractors and all other stakeholders are committed and strive for implementing all mine occupational health and safety management system effectively and efficiently across all operations. Human Resources policy put in place to ensure fairness and non-discrimination employment opportunities Contract ors 80% Company 20% Note: (1) Information as of 31st December 2021. Female 9% Employment Statistics (1) Male Female TOTAL Company 685 123 808 Contractors 2,185 163 2,348 2,870 286 3,156 Male TOTAL 91% 19#20Corporate Social Responsibilities Social & Cultural Biodiversity conservation ➡ Forest conservation Worship facilities construction Health ☐ Health post centre 1,000-days life program Covid-19 prevention Education Scholarship education Teacher training Public library Note: M Economy ☐ Micro economy development Sustainable integrated farming Infrastructure Clean water project Public facility construction Company Information. Jalan Likupang - Bitung. Minahasa Utara Monday, 25 January 2021 08.25. Basic foods donation in response to Covid-19 pandemic 1,000 Days of Life program to support babies' health Integrated chicken poultry cultivation as part of animal husbandry programs Clean water program for near-mine communities 000 MI 10T PROI MSM TTN PEDULI Nutri Zinc cultivation pilot project in relation to stunting prevention PUSKESMAS PEMBANTU (PUSTU) KELURAHAN PINASUNGKULAN PROGRAMSEY ANDINA KADAFZI Integrated health service (Posyandu) activities 20 20#21For Further Information, please contact: Archi Indonesia - Head Office MENARA RAJAWALI, 19th Floor JI.DR. Ide anak Agung Gde Agung Lot #5.1 Kawasan Mega Kuningan - Kuningan Timur - Setiabudi, Jakarta 12950 - Indonesia Phone Email Website : +62 21 576 1719 : [email protected] : www.archiindonesia.com Archi Thank You! Indonesia 21 24