PT HEXINDO ADIPERKASA Tbk Financial Statements For Third Quarter ended December 31, 2009 and 2008 (in US Dollars)FOR THIRD QUARTER ENDED DECEMBER 31, 2009 AND 2008 Balance Sheets Statements of Income Statements of Changes in Equity Statements of Cash Flow Notes to the Financial Statements PT HEXINDO ADIPERKASA Tbk FINANCIAL STATEMENTS. Table of Contents 12PT HEXINDO ADIPERKASA Tbk KawatenInduet Plo Gadung JLo Reming a Ht No.3 Joke 3730, elo (21) 411688 Hunk) Fo: (021 4611686 ip Iwewhesindotbkeoid ‘SURAT PERNYATAAN DIREKSI! DIRECTORS’ STATEMENT TENTANG/ REGARDING say WT TANGGUNG JAWAB ATAS LAPORAN KEUANGAN THE RESPONSIBILITY FOR THE FINANCIAL STATEMENTS UNTUK TRIWUI = GAL 31 DESEMBER 2009 FOR THE THIRD QUARTERLY ENDED 31 DECEMBER 2008 PT. HEXINDO ADIPERKASA Tbk ‘Kami vena bertandatangen i bawah ii We, tre undersigned 1. NamaiName Dis, Manuntun Stumorang Alamat KantorOffice Address 4Jl Pula Kambing 1! Kav I-l No.33, Jakarta Timur ‘Alamat DomisiResidental Address - Pulo Gebang Petmai Blok H7/23 LOOT Rew.078, Cakung- Jakarta Timur Nomor TeleponiTelephone 021-4811688 JabataniTtie President Director 2, NamaiNtame Hideo Satake Alamat KantorOfice Address -JkPulo Karnbing It Kav Il No33, Jakarta Timur ‘Alamal Domisli/Residental Address | Oskwood Apartment - Mega Kuningan Jakarta Setatan ‘Nomar TeleponiTelephone 021-4611688 JabataniTile Director Menyatakan behwa Daclare that 1 jawab atas inan den penvaiian snagn perusahaan: We are responsible forthe preparation and the presentation of tha financial statement of the company: 2. Laporan keuangan aan telah disusun dan 19 sesuai dengan prinsio akuntanel vana besleku mur. The financial statements of the company have baen prepared and fairy presented in conformity with accounting principles generally acoepted in Indonesia 3. a Semua int an Key jetusahaan telah di fan benar, ‘All information has been fully and corectly disclosed in the financial statements of the company: b. uangan perusahaan tidak mengand: n aden idak menghilangkan informas! atau fakta material, ‘The financial statements of the company do not contain false materia! information or facts, do not they ‘omit material information or facts; 4, Bertanaauna lawab atas sistem penaendalian intern d rusahean. We are responsible for the internal contr systern of the company. ‘Demikian pemvataan ini di 39 sebenam ‘This our declaration, which has been made truly. Jalcerta, January 28, 2010 Waugh rae 6000, W Drs. Manuntun Situmorang Hideo Satake b President Director Brestor JAKARTA @ MEDAN @ PEKANBARU PADANG Q PANGKAL PINANG 4 JAMBI A PERAWANG A TANJUNG ENIM ‘A BANDAR LAMPUNG @ SURABAYA 4 SEMARANG 4 PONTIANAK @ BALIKPAPAN @ SANGATTA A SAMARINDA ‘A BANJARMASIN @ MAKASSAR PALUPT HEXINDO ADIPERKASA Tbk. BALANCE SHEETS December 31, 2009 and 2008 (Expressed in US Dollars, unless Otherwise Stated) ASSETS: CURRENT ASSETS Cash on hand and in hanks Receivables - Third partios ( Net of allowance for doubtful accounts of US$ 1.552.394 as of December 31, 2009 and US$ 2,048,202 as of December 31, 2008) - Related parties Finance lease receivables - current portion - Other receivables - third parties Inventories ‘Advance payment Prepaid expenses Prepaid Tax TOTAL CURRENT ASSETS NON CURRENT ASSETS Due from related parties Investment in shares of stock Finance lease receivables - long term portion Estimated claim for tax refund Deferred tax asacts - net Fixed Assets Acquisition cost Accumulated Depreciation Net - Book Value Other assets ‘Total Non-Current Assets TOTAL ASSETS The accompanying notes form an integral part ofthese financial statements. Notes 3 2b 2c,5a 31,6 24,8 10 20 26,5 of 2,6 20,16 2g, 11 2g, 11 1 2009 2008 USS uss 35,808,061 7,789,361 30,479,384 35,596,266 3,804,956 2.182.324 1,424,199 5,516,528 125,280 25.288 91,072,473 99,892,579 5,690,673 34,883 311,583 175.104 9,690,653 2023,888 177842,91 334,054 wan9 4612142 1,588,142 934.997 2295,996 1,300,479 1,099,552 2.734.956 134,256 417,608,072 127,848, (20,043,094) (17,690,356) 27,564,978, 23,787,488 204.25 eRe 30,695 956 215.528.0838 _187,252,008. ag 4PT HEXINDO ADIPERKASA Tbk. BALANCE SHEETS December 31, 2009 and 2008 (Expressed in US Dollars, unless Otherwise Stated) LIABILITIES AND EQUITY Notes 2009 2008 CURRENT LIABILITIES USS USS Short-term bank loans 2 15,000,000 18,000,000 ‘Trade payables Related parties 2e,be 61,735,815 57,985,351 = Third parties 13 3,738,977 2,571,906 Other payables 9,706,233 3,267,671 ‘Accrued expenses 12,826,462 5227841 Taxes payables 8,963, 495 7,301,995, Divident payables 5 Current maturities of long term liabilities: Bank loans 7 1,046,267 2,992,065 Finance lease obligation 18 16,917 73,31 Other payables 19 1,213,605, 7,484,360 Estimated liability for employes benefits 20 66,883 e ‘Total Current Liabilities 114,404,0" Due to related parties 20, Bd 6,647,272 33,236 Derivative instrument payables 2m, 30f 145,054 903,141 Long-term liabilities-not of current portioy Bank loan 17 6,359,599 3,595,799 Finance lease obligation 18 20,643 32,238 Other payables 19 803,016 2,016,717 Estimated liability for employees! benefits 20 1,873,523 1,804,709, Total Non-Current Liabilities 14,749,106 3,585,540 EQUITY Share capital - par value Rp100 per share Authorized - 1.680,000.000 shares Tesued and fully paid - 840.000.000 shares 121 23,282,926 23,232,026 Additional paid-in capital-net 1b}, 22 7,998,836 7,998,836 Retained earnings Appropriated 23 2,622,530 2,138,630 Unappropriated 52,521,238 41,906,420 TOTAL EQUITY 36,375,523 75,271,712 ‘TOTAL LIABILITIES AND EQUITY 215,528,683 187,252,068 Jakarta, January 26, 2010 1 staunan stare President Director | 772p The accompanying notes form an integral part of these financial statements 2PT HEXINDO ADIPERKASA Tbk. STATEMENTS OF INCOME For Third Quarter Ended December 31, 2009 and 2008 (Expressed in US Dollars, unless Otherwise Stated) Notes 2008 uss uss 26.2424 NET REVENUES 30b,306,3, 229875015 202,908,264 08 (COST OF REVENUES 20 2k,25 GROSS PROFIT OPERATING EXPENSES 24,26 sling 11,898,022, 12,096,512 General and administrative 9,396,999 716,921 Totol operating expenses 2,204,960 20,812,455 OPERATING INCOME, 29657,079 28,668,522 ‘OTHER INCOME (CHARGES) Interest income 2iar 305,942 1,487,682 Gain on sales of property & equipment 21,756 37,898 Interst expenses 2028 (1,208,288) 1,313,822) Loss on foreign exchange-net 2n (475,339) (31581,142) Provision (reversal of allowance) for doubtful accounts 24 427.580 (246,550) Miscelaneous - net 594.720 128.814 Other income (charges) - net (245.546) (8.626.922) INCOME BEFORE INCOME TAX INCOME TAX BENEFIT (EXPENSES) ‘Current 20,18 (6,739,920) Deferred 20:18 526,980 Income Tax Expense - Net (212,940) NET INCOME 21,200,489 17,418,761 BASIC EARNINGS PER SHARE 2 os" oe (in US Dollar Jakarta, January 26, 2010 OWipewe tt President Director By ‘The accompanying notes fom an irtegra part of hese financial statements‘swwowojers eoueuy esau Jo Hed 1,80} Ue uN se}ou BUMUEdLERD® aL cess oe Teevewes oes eaae Bea 865Z wewee ee Go0e Fe aGUEDEG TOUR eoro02'1z cov 002'tz. - 6002 seqwesacr uty pouad awoout ron] Kooo'ser) 0'ser ‘1u2sauj20U08 44 voneudoxddy foro ve'on, \oso'sve'on) : 289 spuapip use9| ‘Ovoss0'9L ‘apleoozy oeseerz oes s6e wae Booz wis'089 our'ts6) _ 10882 corse = 991 20687 ver sOoEY eee ‘S609 Liseee ee 2. Ana pue panes fnba pereudoxideun | _paroudoxddy eee we. ‘sbuwea pour feo a1eus. ‘002 pue 600% ‘be 1oquie29q pepua JoUeND pul JO ALiNOa NI S3ONVHO 40 SINSMSLVIS HAL VSYIUAdIGY OGNIXSH “Ld |PT HEXINDO ADIPERKASA Tbk. [STATEMENTS OF CASH FLOWS: For Third Quarter Ended December 31, 2009 and 2008, (Expressed in US Dollars, Unless Otherwise Statod) 2000 2008 (CASH FLOWS FROM OPERATING ACTIVITIES USS. USS (Cash receipts from customers 282,817.038, 172330768 Cash pai to ‘Suppliers (161,246,600) (153,341,742) (Operating activites (12:428,416) (40,140,626) ‘Salaries, wages and benefit of employees 11.397 813) 10,525,114 Net cash proved by operations 17,804,120 (1.976.714) ‘Received frm intrest income 395,042 287297 Payment of interest expenses (1.483287) (734947) Payments for income taxes Ga12827) (e00.318) Payments for value added taxes (4388-280 Net ash provid by used in) Operating Activities 65,475,469 (2,533,742) (CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sales of property equipment aura sagrt ‘Acausilons of property and equipment 2.231.876) (4,405,832) Construction in progress (657.405) (4.901.961) Payment of investment in shares of sock (1'389\283) Adltional of advance payment (4.548.131) 33,402, Not cash used in investing ‘Activities (7,413,634) (7,599,193) (CASH FLOWS FROM FINANCING ACTIVITIES Proceeds fom shor-torm bank loan 12,000,000 18,180,183, Proceeds ftom iong-term bank loan ci 5352320 Cash dvent (10,844,010) (810.860) Paymeatof short-term bank loan (31,000,000), (15,875,068) Payment of ong-erm bank oan (1,156,026) 1,068,317) Payment of otter payables z (6,850,634) Payment of nance lease obligation 179.134 109,772) Net cash proved by (used in) Financing Actives 94,179.17 982,232) ‘Not increaso (Decrease) in cash on hand 27,882,688 (14.15,187) ‘and in banks Cash on hand and in bank at beginning of period 7.920.408 18,904,520 ‘CASH ON HAND AND IN BANK AT END OF PERIOD 35,003, I The accompanying notes form an integral part ofthese financial statements.PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (Expressed in US$ Unless Otherwise Stated) 1 GENERAL a Establishment of the Company PT Hexindo Adiperkasa Tbk (the “Company*) was established in Indonesia based on Notarial Deed dated November 28, 1988 No. 37 of Mohamad Ali, S.H. The Deed of Establishment was approved by the Ministry of Justice of Republic Indonesia in its Decision Letter No, C2- 4389,HT.01.01.TH.89 dated -May 12, 1989, and was published in Supplement No. 1251 of the State Gazette No, 54, dated July-7, 1989. Its Articles of Association has been amended several times, the latest amendment was notarized through Notarial Deed No. 163 and 164, June 29, 2009 and No. 61, August 20, 2009 of Robert Purba, S.H.. These amendments will register to the Department of Justice and Human Rights of Republic Indonesia ‘The Company started its commercial operations in January 1989. ‘According to Article 3 of the Company's Articles of Association, its scope of activities comprises of trading and rental of heavy equipment and rendering of after-sales services. Presently, the Company acts as a distributor of certain heavy equipment and related spare parts under Hitachi, John Deere and Krupp trademarks. The Company is domiciled in Jakarta, located at Kawasan Industri Pulo Gadung, Jalan Pulo Kambing I! Kav. I! No, 33, Jakarta 13930. As of December 31, 2008, the Company has 11 main branches, 2 sub-branches, 9 representative offices and 10 project offices, which are all located at various places in Indonesia, Company's Initial Public Offering ‘The Company's registration statement for its public offering of its 10 milion shares (with Rpt,000 (full amount) par value per share) at an offer price of Rp2,800 (full amount) per share became effective in accordance with the Letter No. S-1958/PM/1994 dated December 5, 1994 issued by the Chairman of the Capital Market and Financial Institution Supervisory Agency (BAPEPAM-LK), ‘All of the Company's shares have been registered in the Indonesia Stock Exchange since February 13, 1995. ‘The Company's registration statement for its First Limited Public Offering of 42 million shares. (with Rp1,000 (full amount) par value per share) to shareholders with pre-emptive rights at an offer price of Rp1,000 (full amount) per share became effective in accordance with Letter No. S- 1264/PM/1998 dated June 19, 1998 issued by the Chairman of BAPEPAM-LK In the minutes of the Extraordinary Shareholders’ Meeting of the Company held on June 12, 2000, as covered by Notarial Deed No. 12 on the same date of Fathiah Helmi, S.H., the shareholders resolved fo amend its Articles of Association, which include, among others, change in par value from Rp1,000 (full amount) per share to RP500 (full amount) per share. These amendments were accepted and recorded by the Department of Justice and Human Rights of Republic indonesia in its Letter No. C-21025 HT.01.04.Th.2000 dated September 20, 2000. On July 28, 2002, the stock split was effectively implemented1 PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (Expressed in USS Unless Otherwise Stated) GENERAL (Continued) In the minutes of the Extraordinary Shareholders’ Meeting of the Company held on June 15, 2004, as covered by Notarial Deed No. 24 on the same date of Fathiah Helmi, S.H., the shareholders resolved to change the par value from Rp500 (full amount) per share to Rp100 (full, amount) per share. This amendment was accepted and recorded by the Department of Justice and Human Rights of Republic Indonesia in its Letter No. C-23337 HT.01.04.Th.2004 dated ‘September 17, 2004. On September 1, 2005, the change of the par value was effectively implemented. Boards of Commissioners, Directors, Audit Committee and Employees. ‘The composition of the Company's boards of commissioners and directors as of December 31, 2009 are as follows: Board of Commissioners: Kardinal Alamsyah Karim, MM. = -——~President Commissioner Harry Danui = Commissioner Donald Christian - Commissioner Directors: Manuntun Situmorang President Director Toshiaki Takase - Director Hideo Satake = Director Yoshiya Hamamachi - Director Shinichi Hirota - Director Hideo Kumagai ~ Director Tony Endroyoso. - Director ‘Shogo Yokoyama - Director Toru Sakai - Director ‘The composition of the Company's audit committee as of December 31, 2009 are as follows: Harry Danui - Chairman Danny Lolowang, = Member Bambang Wiharto - Member ‘The composition of the Company's boards of commissioners and directors as of December 31, 2008 are as follows Board of Commissioners: Kardinal Alamsyah Karim, MM. --—_—~President Commissioner Harry Danui - Commissioner Donald Christian = CommissionerPT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (Expressed in USS Unless Otherwise Stated) ¢. Boards of Commissioners, Directors, Audit Committee and Employees (Continued) Directors: Manuntun Situmorang - President Director Toshiaki Takase - Director Hideo Satake = Director Yoshiya Hamamachi = Director Shinichi Hirota - Director Tetsuo Maruyama - Director Tony Endroyoso - Director Naoki Kito = Director Yasushi Ochiai - Director ‘The composition of the Company's audit committee as of December 31, 2008 are as follows: Harry Danui - Chairman Danny Lolowang. - Member Bambang Wiharto - Member The salaries and other compensations benefits incurred for the Company's commissioners and directors amounted to US$889,288 for December 31, 2009 and USS 933,093 for December 31, 2008 ‘As of December 31, 2009 and December 31, 2008, the Company had 997and 956 permanent employees 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES a. Basis of Preparation of the Financial Statements The financial statements are prepared in accordance with generally accepted accounting principles in Indonesia, which are the Statements of Financial Accounting Standards (PSAK), BAPEPAM-LK regulations and the Guidelines for Financial Statements Presentation as circulated by BAPEPAMLLK for trading companies, which offer their shares to the public. ‘The financial statements are prepared on the historical cost basis, except for inventories which are valued at the lower of cost or net realizable value and derivative instrument which are valued at fair value. The financial statements are prepared based on accrual basis, except for the statements of cash flows. ‘The statements of cash flows presents cash receipts and payments classified into operating, investing and financing activities using the direct method. In accordance with the minutes of the Extraordinary Shareholders’ Meeting of the Company held on July 21, 2008, as covered by Notarial Deed No. 159 on the same date of Robert Purba, S.H., the shareholders resolved to change the Company's fiscal year from January to December to April to March that will be effective for 2009 fiscal year. The change was approved by the Directorate General of Tax in its decision letter No. KEP-00003/THBK/ WPJ.07/KP.0803/2008. ‘The reporting currency used in the financial statements is United State Dolla. 8PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (Expressed in US$ Unless Otherwise Stated) 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) b. Allowance for Doubtful Accounts ‘The Company provides allowance for doubtful accounts based on the certain percentage of accounts receivable balance and review on the condition of each customer at balance sheet date. ¢. Transactions with Related Parties ‘The Company has transactions with certain related parties, Related parties are defined in accordance with PSAK No. 7, "Related Parly Disclosures’ Alll transactions with related parties are disclosed in the notes to the financial statements d. Inventories Effective January 1, 2009, the Company has applied PSAK No. 14 (Revised 2008), "inventories", which supersedes PSAK No. 14 (1994), “Inventories”. The adobtion of this revised PSAK did not result in a significant effect in the Company's financial statements. Inventories are stated at the lower of cost or net realizable value. Cost of heavy equipment inventories reclassified from heavy equipment previously being leased out, at the end of the lease terms are stated at net book value The cost of heavy equipment inventories is determined by the specific identification method while the cost of spare parts is determined using the average method. Net realizable value is the estimated selling price in the ordinary course of business, less estimated cost of completion and the estimated cost necessary to make the sale. Allowance for inventories obsolescence is provided based on a review of the condition of the inventories at balance sheet date e. Prepaid Expenses Prepaid expenses are charged to operations over the periods benefited f. Investment in shares of stock Investment in shares in which the Company has ownership ess than 20% is recorded using cost method,PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (Expressed in USS Unless Otherwise Stated) 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Q. Property and Equipment 1 Direct ownership Effective January 1, 2008, the Company applied PSAK No. 16 (Revised 2007). “Fixed Assets’ which supersedes PSAK No. 16 (1994), “Fixed Assets and Other Assets’, and PSAK No. 17 (1994), "Accounting for Depreciation”, whereby the Company has chosen the cost model. The adoption of this revised PSAK did not result in a significant effect in the Company's financial statements. Property and equipment is stated at cost less accumulated depreciation and impairment losses. ‘Such cost includes the cost of replacing part of the property and equipment when that cost incurred, f the recognition criteria are met. Likewise, when a major inspection is performed, its cost is recognized in the carrying amount of the property and equipment as a replacement if the recognition criteria are met. All other repairs and maintenance costs that do not meet the recognition criteria are recognized in profit or loss as incurred Depreciation, except for heavy equipment being leased out, is computed using the straight-line method over the estimated useful lives of the assets as follows: Year Rate Building 20 5% Vehicles, office equipment, furniture and fixtures and machineries 5 20% Tools for after-sales service 2 50% Depreciation for heavy equipment being leased out is based on operational hours and over the term of the lease, which are in line with the related leased agreements ‘An item of property and equipment is unrecognized upon disposal or when no future economic benefits are expected from ifs use or disposal. Any gain or loss arising from unrecognized of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or oss in the year the asset is unrecognized ‘The asset's useful lives and methods of depreciation are reviewed, and adjusted prospectively if appropriate, at each financial year end Costs incurred in connection with the acquisition or renewal of landrights are deferred and amortized over the lower of legal terms of the related landrights or economic lives of the land using the straight-line method. The deferred charges are presented as part of ‘Other Assets” account in the balance sheets. 2 Construction in progress Construction in progress represents the accumulated cost of materials and other costs related to the asset under construction. When the asset is completed and ready for its intended use, these costs are reclassified to the related accounts 10PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended Decombor 31, 2009 and 2008 (Expressed in US$ Unless Otherwise Stated) 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) h Impairment in Assets Value ‘At balance sheet date, the Company conducts a review for any indication of impairment due to possible events or changes in circumstances that the carrying value may not be fully recoverable, Impairment in asset value, if any, is recognized as loss in the statement of income of the current year. Lease Effective January 1, 2008, the Statement of Financial Accounting Standards (PSAK) No. 30 (Revised 2007), "Leases" supersedes PSAK No. 30 (1990), “Accounting for Leases”. Based on PSAK No. 30 (Revised 2007), the determination of whether an arrangement is, or contains a lease is based on the substance of the arrangement at inception date and whether the fulfilment of the arrangement is dependent on the use of a specific asset and the arrangement conveys a Tight to use the asset. Under this revised PSAK, leases that transfer substantially o the lessee all the risks and rewards incidental to ownership of the leased item are classified as finance leases, Moreover, leases which do not transfer substantially all the risks end rewards incidental to ownership of the leased item are classified as operating leases, The Company as a lessee Based on PSAK No. 30 (Revised 2007), under a finance leases, the Company shall recognize assets and liabilities in their balance sheets at amounts equal to the fair value of the leased property of, if lower, the present value of the minimum lease payments, each determined at the inception of the lease. Minimum lease payments shall be apportioned between the finance charge and the reduction of the outstanding liability. The finance charge shall be allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liabilty. Finance charges are reflected in profit and loss. Capitalised leased assets, (presented under the account of property and equipment) are depreciated over the shorter of the estimated useful life of the assets and the lease term, if there is no reasonable certainty that the Company will obtain ownership by the end of the lease term, Under an operating lease, the Company recognized lease payments as an expense on a straight- line basis over the lease term The Company as a lessor Based on PSAK No.30 (Revised 2007), under a finance lease, the Company shall recognise assets held under a finance lease in its balance sheets and present them as a receivable at an ‘amount equal to the net investment in the lease. Lease payment receivable is treated as repayment of principal and finance income. The recognition of finance income shall be based on a pattem reflecting a constant periodic rate of retum on the Company's net investment in the finance lease "PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (Expressed in USS Unless Otherwise Stated) 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Lease (Continued) Under an operating lease, the Company shall present assets subject to operating leases in its balance sheets according to the nature of the asset. Initial direct cost incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognized over the lease term on the same basis as rental income. Lease income from operating leases shall be recognized as income on a straight-line basis over the lease term, ‘At the application of this revised PSAK, the Company has chosen to apply this revised PSAK retrospectively in which all leases transactions that existed before January 1, 2008, were evaluated by the Company to determine their classifications in accordance with this revised PSAK and treated as if it had been applied since the commencement of the lease term, Additional Paid-in Capital - Net ‘Additional paid-in capita -netis the difference between the offering price and the par value of share capital issued, net ofthe costs incurred in connection with the public offering, k. Revenue and Expense Recognition Revenue from sales of heavy equipment and spare parts are recognized when the heavy equipment and spare parts are delivered to the customers. Revenue from repairs and ‘maintenance services and commission income are recognized when the services are rendered to the customers. Revenue from rental of heavy equipment is recognized based on the usage of heavy equipment in accordance with the related agreement. Expenses are recognized when incurred (accrual basis). 1. Estimated Liability for Employees’ Benefits The Company adopts PSAK No. 24 (Revised 2004), “Employee Benefits’ that recognizes the accounting and disclosures of estimated labilty for employees’ benefits. Total estimated liability for employees’ benefits is calculated in acoordance with the Labor Law No. 13 Year 2003 dated March 25, 2003. Under PSAK No. 24 (Revised 2004), the defined benefit obligation, current service cost and past service cost are calculated using the projected unit credit actuarial valuation method. Actuarial gains and losses are recognized as income or expense when the net cumulative unrecognized actuarial gains and losses at the end of the previous reporting year exceeded 10% of the present value of defined benefit obligation at that date, These actuarial gains or losses are recognized on a straight line basis over the expected average remaining ‘working lives of the employees. Further, past-service costs arising from the introduction of a defined benefit plan or changes in the benefit payable of an existing plan are required to be amortized over the period until the benefits concerned become vested 12PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (Expressed in US$ Unless Otherwise Stated) 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) m. Derivative Instruments Every derivative instrument (including embedded derivatives) is recorded in the balance sheets as either asset or liability and measured at their fair values of each contract. Changes in derivative fair value are recognized in current earnings unless for specific hedges which allow a derivative's gains and losses to offset related results on the hedged item in statements of income. ‘An entity must formally document, designate and assess the effectiveness of transactions that meet hedge accounting. The Company’s derivative instruments are not designated as hedging instruments for accounting purposes. n. Foreign Currency Transactions and Balances Transactions involving foreign currencies are recorded in US Dollar atthe rates of exchange prevailing atthe time the transactions are made. At balance sheet date, monetary assets and Jiabilties denominated in foreign currencies are adjusted to Rupiah to reflect the rates at such date. The resulting gains or losses are credited or charged to operations for the period ‘As of December 31, 2009 and December 31, 2008, the rates of exchange used are, as follows (full amount of US Dollar): 2009 2008 1 Euro (EUR) 13,510 15,432 1 United States Dollar (USS) 9,400 10,950 1 Australian Dollar (AUD) 8432 7,555 1 Singapore Dollar (SGD) 6699 7,607 1 Japanese Yen (JP¥) 102 121 ©. Income Tax Current tax expense is provided based on the estimated taxable income for the period. Deferred tax assets and liabillies are recognized for temporary differences between the financial and the tax bases of assets and labililes at each reporting date. Future tax benefits are also recognized to the extent that realization of such benefits is probable, Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the balance sheet date. Changes in the carrying ‘amount of deferred tax assets and liabilities due to a change in tax rates is charged to current period operations. Atbalance sheet date, the carrying amount of deferred tax asset is reviewed and adjusted to the extent that its no longer probable that part or all ofthat deferred tax assets willbe realized in the future ‘Amendments to tax obligations are recorded when an assessment is received or, if appealed against by the Company, when the result of the appeal is determined. 13PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (Expressed in USS Unless Otherwise Stated) 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) p. Basic Earnings per Share Basic earnings per share is computed by dividing the net income for the period with the weighted- average number of the shares outstanding during the period. The weighted-average number of shares outstanding as of December 31, 2009 and 2008 is 840,000,000 shares, @. Segment Information The Company classifies its segment reporting as follows: i) Business segment (primary) based on the nature of its products sold, consists of sales and rental of heavy equipment, sales of spare parts of heavy equipment and repairs and maintenance services ii) Geographical segment (secondary) based on location of sales, consists of within Java island and outside Java island, F, _Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in Indonesia requires management to make estimations and assumptions that affect ‘amounts reported therein. Due to inherent uncertainty in making estimates, actual results reported in future periods might be based on amounts that differ from those estimates. s. _ Revised Statements of Financial Accounting Standards ‘The following summarizes the revised Statements of Financial Accounting Standards (PSAK) which have been issued by the Indonesian Institute of Accountants but not yet effective in 2009; 1 PSAK No. 50 (Revised 2006), “Financial Instruments: Presentation and Disclosure: contains the requirements for the presentation of financial instruments and identification of the information that should be disclosed. The presentation requirements apply to the Classification of financial instruments, from the perspective of the issuer, into financial assets, financial liabilities and equity instruments; the classification of related interests, dividends, losses and gains; and the circumstances in which financial assets and financial liabilties should be offset. This standard requires the disclosure, among others, of information about factors that affect the amount, timing and certainty of an entity's future ‘cash flows relating to financial instruments and the accounting policies applied to those instruments, PSAK No. 50 (Revised 2006) supersedes PSAK No. 50, "Accounting for Certain Investments in Securities” and is applied prospectively for the periods beginning on or after January 1, 2009 (which was subsequently revised to become on or after January 1, 2010). Earlier application is permitted and should be disclosed 14PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (Expressed in US$ Unless Otherwise Stated) 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) 2 PSAK No. 55 (Revised 2006), "Financial Instruments: Recognition and Measurement’, establishes the principles for recognising and measuring financial assets, financial liabiliies, and some contracts to buy or sell non-financial items. This standard provides for the definitions and characteristics of a derivative, the categories of financial instruments, recognition and measurement, hedge accounting and determination of hedging relationships, among others. PSAK No. 55 (Revised 2006) supersedes PSAK No. 55, “Accounting for Derivative Instruments and Hedging Activities’, and is applied prospectively for financial statements covering the periods beginning on or after January 1, 2009 (which was subsequently revised to become on or after January 1, 2010). Earlier application is permitted and should be disclosed 3 PSAK No. 26 (Revised 2008) "Borrowing cost’ prescribes the accounting treatment for borrowing cost, and supersedes PSAK No. 26 (1997). This revised PSAK provides guidance on borrowing cost of that are directly attributable to the acquisition, construction r production of a qualifying asset form part of the cost of that asset. Other borrowing costs are recognized as an expense. This revised PSAK is effective start on January 1, 2010. Earty application is permitted 4 PSAK No. 10 (Revised 2009), "The Effect of Changes in Foreign Exchange Rates’, this PSAK supersedes PSAK No. 10 (1994), PSAK No. 11 (1994) and PSAK No. 52 (1997) ‘This revised PSAK is effective start on January 1, 2011. 5 PSAK No. 48 (Revised 2006), "Impairment Of Assets", this PSAK revised PSAK No. 48, (1998). This revised is effective start on January 1, 2011 ‘The Company is currently evaluating the effect of the above revised PSAK and has not determined the effect on its financial statements. 15PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quartor Ended December 31, 2009 and 2008 (Expressed In US Dollars, unioss Otherwise Stated) ‘GASH ON HAND AND IN BANKS This account consist of December 2000 December 2008 Cash on hand USS USS: Cash, RP 962,928,010 as of December 31, 2000 and 102439 38.22 RP. 417 439,637 as of December 31, 2008 ‘cash in bank Rupiah accounts PT Bank CIMB Niage Tok (Frovicusly Bank Lippo Tox) (@PO5%4570114 sof Deambee 3, 2008 an AP 1394073817 aso December 3,208) 112,188, 1,245,730 PT Bank Reson Perdania APO CO4BIT asf Dever, 2008) 8.525 7.400 PT Bank Intertiona Indonesia Thc (92 5484160884 a Decree 31,200 snd 580,230 422539 [e426 8070 oo Deca’ 31,2003) PT Bank Rakyat Indonesia (fi 022447105 ce Denar, 2000 and RP 126 90.05 arc December, 2008) 87.491 11397 PT Bank Danamon Tbk. (2206056240 a of Deeb 3, 0094 Rp 16 720 a Desembar1,2009) 218,099 53,088 PT Bank Mandi (F102 170.02 a of December 3, 009 "RP 1.89 8.4 af Date 2008) 409.487 165,923, PT Bank Mega (625750406 a8 of Deember 9,200 ‘RP 061150 240 a cf Deer 9, 708) 676,340 708,428 Clbenkc NA, Jakarta (2P 162235365 of Decanter 31,2009 RP 135044.00 asf Docent, 208) 172801 105,800 PT Bank Negara Indonesia (Perse) TOK (9 125400112 Deconber 3,200 sd Fe ep200,719 act December 3, 2000) 1347 6.064 PT. Bank Mizuho Indonesia (70707758 eset December 1, 200028 [RPO7O4 178 eof Decber 9,208) 11033 04 ‘The Bank of Tokyo Mitsubishi UFJ, Lid, Jakarta (FP 345270285 of Deoanber 3,200 and "RP-.98 720882 a of Does 1, 2008) 367,318 310,204 ark Samoan oncla (8 097032248 Dovaner 2,200) 11062 Total Rupiah Accounts 3,247,650. 3,116,396 United States Dollars accounts PT Bank Resona Perdania 2503 2.543 PT Bank Intemational Indonesia To 25,490,947 4.923.027, “Tho Bank of Tokyo Mitsubishi UFJ, Ltd. Singapore 432.839 411.097 PT Bank Mega 739,692 59,181 Citbank NA, Jokarta 231,538 292,189 PT. Bank Mizuho Indonesia 111053, 7.485 PT Bank Shinta| 195 195 ‘Tne Bank of Tokyo mitsubishi UFJ, Lid 5.445577 1,987,742 Bank Sumitomo Mitsui Indonesia Tort ‘otal United States Dolor Accounts Baa 454 F553 570 Japanese Yon accounts Tho Bonk Tokyo MMS UF, kta (PY 165722191 eect Deconbe 3,20 ant JPY 8.70048 2 Decent 208) 20,006 70618 (JP 1915828 a of December 31, 208 a “PY s79 85898 Grcanber 1, 08) 1424 10,846 Total Japanese Yen accounts 21516 31,464 “otal cash in Banks 5700622 751239 “otal eash on hand an in banks 35,808,061 7,788,364 16PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 34, 2009 and 2008 (Exprossod in US Dollar, unless Otherwise Stated) 4. TRADE RECEIVABLES - THIRD PARTIES “This account cepcesents trade reetvables- tid pares arising from: December 2000 December 2008 USS. iss Sales and rental of heavy equipment, used in Plantation and loging 4,288,038 8276260 Contretons 7874 31872 ‘Ming 3,426,987, 12,446,491 Tosa 702.590 20,754,623 Repairs and maintonace services 9,605,648 7,863,616 Sales of spare parts 14633531 9.028 229 Tota 32,031,778, 37,644,408, Allowance for doubiful accounts 1.852,308 (2,048,202) Net 30,479,384 35,596,266, “The movements of allowance for doubtful accounts during the petad are ftows: December 2009 _Decerrher 2008 USS i Begining balance 11979,745, 1,968,160 Proviso daring the period "164,869 198,046 Reverso allowanee for account receivables (680,952) 3 ‘Write off of acces during te period 1,068 (118.90 ating balance 1,552,304 2,048,202 “The aging analysis of trade receivables - thi parties based on due dates areas folowe: ‘December 2009 ‘December 2008, Sales and rentl of heavy equips USS (Curent and les than 3 months 7,318,108 3-6 ments 280.656 (Over 6 moms 1 year 30.228, Over I year 65,508, Tota 7,702,599 20,754623 Reps and raierance sevice: Curren nls thin months 9,543,588, 7977.608 3-6 ments 109,900 119518 ‘Over months 1 year 16457 28,559 Ove yeae 25613 37,931 Tota 9.695.648, 7,883,616, Soles of sare parts (Current rl esi than 3 months 14,540,801 8,905,749, 3-6 months 43637 "103,282 Over 6 months- ear 33,887 5310 Over I year 15.116 11917, ‘oval 14,633,531 9,026,229 etal of trade recelvables- tied partes based en original currencies areas folwn: December 2009 __Decernber 2008_ USS USS: Unted States Dears 28,165,552 35,097,707 Rui 3,885,226, Total 32,031,778, vPT HEXINDO ADIPERKASA Tok NOTES TO THE FINANCIAL STATEMENTS. For Third Quartor Ended Decomber 3, 2008 and 2008 (Expressed in US Dollars, unless Otherwise Stated) &_ BALANCES AND TRANSACTIONS WITH RELATED PARTIES 2 Trade Receivables Details tae seni fom rested nates onsale ansctionare a fllows December 2002 _Dacomber 2008 uss USS isch Consbuction Machinery Asa and esi Pe Lt Singapore 1270428 2,180,324 Hitachi Construction Machinery Thaiand 2227 SHOM Service 5.875 : PP Hitachi Construction Machinery Finance Indonesia 2017 426 7 “Total 3.304.956, Zia December 2009 _Dacomber 2008 . Other Receivables USS USS. Employees 278.537 282,167 Hitachi Construction Machinery Asia and Paciic Pe, Lid, Singapura er Hitachi Construction Machinery Co, Japan 50,192 east Hitachi Construction Truck Menufectring Lid Canada : 98.824 PT Hiachi Construction Machinery Finance indonesia 5.385 Toto ee ee rr “Total of receivables from related partes 369,010 Percentage FRocchtles rom emoyees manly represent noninterest bearing for housing loans ellectibe through manly pal deductons. © Teale Payales esl of tae payabesto relied partis on prc transaction areas follows Deemer 2009, December 2008, USS USS PT Hitachi Construction Machinery Indonesia 40812632 244703320 ‘Hitachi Construction Machinery Asia & Pasi Pte, Lis 20,778,498 31,991,907 Singapore Hitachi Construction Machinery Co, id. Japan 123,354 305,430 Hitachi Construction Truck Manufacturing Lis ‘Canada 12,140 27685 HOM Trading 8.991 : oval SRE RIS ep ars Payables oP Hitachi Consteton Machinery Indonesa represent payables on purchases of spare parts Inventories and heat equipment Payables to Hitachi Construction Machinery Asia and Pacific Pte, Lid, Singapore (HMAP), represent payables cn purchases of spare parts inventories and heavy equipment, and deposits received bythe Company om HMAP's customers for purchases of heavy eauipment 10 HMAP, of which the Company isthe sales agent Payables to Hitachi Construction Machinery Co.,Ltd, Japan, represent payables cn purchases of spee pats inventories, Payables to Flach Construction Truck Manufecturing ic, Canada (HTN), represent portion of revenue sharing of HTM for the rental of hhezuy equipment ned by HTM to certn custmer 18PT HEXINDO ADIPERKASA Tok NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (Exprossed in US Dollars, unless Othorwise Stated) 6 BALANCES AND TRANSACTIONS WITH RELATED PARTIES (continued) December 2000 December 2008 ame or Cher Payables USS USS * * Fitch Consituction Machinery Co. td, Japan 210,630 9732 om oat Hitachl Construction Machinery Asia & Posie Pte, 16 5,333,902 - an ‘Otners (below Fip:300 milion each) 2740 23508 om aw otal 5.547.272 ao om ‘The nature of relationship ofthe Company with related partes areas follows: ‘Name of Related Pats Relationship 4. Hitch Construction Machinery Ca, Lid, Japan ‘Shareholder 2. Hitachi Construction Machinery Asia Pasiie Pe, Lid, Singapore ‘Shareholder 3. tect Corporation, Japan ‘Shareholder 4. Hilachi Construction Truck Menvfacturing Li, Cana Afliated Company 5. PT Hiachi Construction Machinery Indonesia Afiaed Company 6. Michi Construction Machinery (Shargha) Co., Lt, Cina Afftaed Compeny FINANCE LEASE RECEIVABLES The {ure collection fnance lease receivtles required under the lease agreements ae as folows: December 2009 December 2008 _ uss. uss. Finance lease resiables 2,359,198, tos12.824 LUncarned finance lease income A - Total Zaoise = SCSC«OBTSD {Less Curent potion (1424-199) (8,516,528) Lone erm potion 954.937 2,295,996, Finance lease receivables represent receivables from PT Kaltim Prima Coal (KPC) in cennection with rentals of 14 units of heavy ‘equipment purchased from Mitsubishi Corperation ‘The Company/s management bllves hall fence lease receivables can be collected, and thus no alowsnce for doubtful accounts were rowed for. OTHERS RECEIVABLES - THIRD PARTI This account consist of: December 2008 December 2008 uss USS ‘Anglo Coal South Aca : 4en (CiptaKrca Bahan 2.500 (Gracemount Pesut ay 67.953, ‘a bangun Persada 354 Machani Talatah Nusa 17933 10.995, AMA Persada 4820 Ptroconas a2 ; “Trackspare PT 1,005 Waratah : 41352 Others sor 4525 Tova 125,300 25,228PT HEXINDO ADIPERKASA Tok NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 34, 2009 and 2008 (Expressed in US Dollars, unloss Otherwise Stated) INVENTORIES - WET “his aocount consis of: December 2000 December 2008, uss uss Merchandise inentoies Heavy equipment 31,787,735 49.007.672 Spare pars en 714834 51422971, Total 93,502,589 707.330.648 Less allowance for inventories cbsolescence 2.430.096) (1,438,084) Net 91,072473 99,092,578 The movements of allowance fer inventeris cbsclescence during the period are as follow: ecornber 2008, ‘December 2008 USS. USS Balance at beginning of year 1.304,306 1057,619 Provision cing the parod 11378553 787,708 Reversal of allowance during th year (42.38%) és Wiite-ff during the period 407,261) Balance zt end of year ZeBODEE. 738,084, “The Companys management betowes that he allowance for inventories obsolescence is adequate to cover posible losses frm inventories obsolescence. ‘Allinventoric (except fr inventros in trans are covered by insurance aginst losses from fie an other ks unde blanket policies of -Rp499,466,000,000 (equivalent. USS48,845,578) as of December 31, 2009 and Rp416, 169,000 000 (equhalent USS45, 113,171) as of December 20, 2008, which the Company's management bates tat the insurance coverage is adequate lo cover possible losses arising from such risk, 210. PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (Expressed in US Dollars, Unless Otherwise Stated) PREPAID TAXES Prepayment of income taxes: Atticle 22. Article 23, Avticle 25 Total prepayment of income taxes Value Added Tax Total prepaid taxes Estimated tax receivables: Income taxes: ~ Period 2007 - Period 2008 Total estimated tax receivables ADVANCE PAYMENT This acount consists of: Purchasing goods Travelling Others Total December 2008 December 2008 USS, USS. 615,096 4,221,373 5 5,176,579 - 8,013,048 7 4,677,605 2,023,838 9,690,653 2,023,838 December 2009 December 2008 USS USS 5,279,444 336,984 42,712 : 17,899 354,883 24PTHEXINDO ADIPERKASA Tok NOTES TO THE FINANCIAL STATEMENTS. Fox Third Quarter Ended Decanter 21, 2009 and 2008 (Expressed in US Doers, Unless Otherwise Stated) PROPERTY AND EQUIPMENT “Thi scznt con ot Dlcest owmershio —___________Aitbecomber 000 Beginning Balance pare Deducfon ending Balance Recastestons) __(Recsaiteatin) cost uss uss. uss us, tee ats8 eae : 9240404 Baty es.a72 a.se.004 4 s7asgo ‘verses s.stoo04 7ss00 235085 078.500 Ofc equpment sseasi2 94400 40948 aera niu 8 fos 74998 aor. 1612002 Mocneares 1.78857 ease 20871 2529.98 Toa er ahersles serene a.s.t85 sass 59.000 5.981 Heavy eqveront-rena s.8c0957 : ‘0.005, 1.409.202 Lenses asst vere soar : 480007 Const noes eo.7r8 es7405 sasoeu eager Teta cot ss75.504 soase.4 eazasea 700072 ‘Accumulated Depreciation Und . Baadeg asnarra 5480 4s 007197 venetes seanaes arate 20.133 4.500200 fio eqment 010724 sesc00 eon sua.712 Fane & tures 4,198,508 4908 2035 40717 actrees samen 169,179 aoe sate.st “oot ser saos serves eure waar ss0se a.am4s7 Hay caveman rer 60.19 79.008 1208 casart eased ast vena seus com 20.908 Total Assumes Depredaion 1051000 24.510 arrzat___agssona Book vie Direct ownership Und 118656 199708 e eign Bats ‘ves7s00 soar ro.1m8674 Vetice 79540 amen 4946 1.168.208 otic equipment 1.5.88 sae 1.951 1 2y0278 Future & ures 219,600 enese a 306485 ectinees ArT 998 5502 : si34sr Tel for ater ste ; servone aro 0.380 “ asta eau eqspment etal 1.004.698 (279.005) 6,022 xr veces aonga exe) : nase ation ha omares aso.776 eras seen ‘47 Net ook vale 75573666 7.915 ‘actor 27 se478 22PTHEXINDO ADIPERKASA Tb [NOTES TO THE FINANCIAL STATEMENTS For Third Quartr Endod Decomber 31, 2009 and 2008, (xpreseed in US Doors, Unless Ohervee Stat) PROPERTY AND EQUIPMENT (continued) Direct ownership Apt December 2008 . ‘adiens ry Begining Belace——asereemenins) ——_(Rotnneny _Estng Balance cost uss uss uss USE Land 3.383.620 z2071 : 9.115697 Building 8.763504 32.520 5 8.706.034 venicles 5520830 124409 241.583 403,717 ffce equipment 4066,873 187388 37.169 4.167.052 Furniture & otros 11380885 o4s72 aa sanior Mactineries 1,490,880 8.480 1268 1,722,102 “Too fr afer ealoe sonices 2060458 34488, 35,091 3,106,050 Heavy equement rental 1.492.052 : 1.402.892 Vehisies 41955 sn ase037 ‘Sonstucton in oars 7584 seressr ss7251 Tota cost ET om 168 sre6 aa ‘Accumulated Depreciation Land ° uling 3700201 390,198 : ‘4,060,504 Vehicles 905,088 133.505 2at.138 4797455, foe enue 2.686,887 307,242 19.359 292,770 Furmiore &fures 4102558 72856 412 saToz02 Machineries 4189560 92.456 7288 szas.rs7 Tool for aftersales senvicns 2597 408 176458 asa67 2.788088 Heavy equipment rental 72408) ro1aza : ere.908 essed set 5 Vehicies 79529 2502 5 149.001 ‘Sonstucion in eoares ° Total Accumulated Depreciation 76 086,036 1.076355, ‘72.088 17680,368 Book value Land 3.885,620 ze0r7 : 9.115607 Bulaing 5.083.113 297,068) : 4738440 Voices 615,742 (9.065) a5, 06,281 Ofce equipment 11967. 988 (9874) 3.820 1,204,202 Fumiture & ftures 270.297 e790) 3 ‘240,10 Mochinorios serait 6,034 : 4850s Tool er ater-sales : : services 252,860 195.028 2 area Heauy equipment rental 1,685,378, 31.422) : 873.054 Lessectasset - : : ° Vonicos 342,606 (20.020) 22976 constuction in peoares 7584 so7s97 5887251 Bock value - net z 70784866 08.305 zi, 2787488 I 2207S AOD 23PT HEXINDO ADIPERKASA Thi [NOTES TO THE FINANCIAL STATEMENTS For Ths Quarter Ended Decembar 31, 2009 and 2008 (Expressedin US Dolars, Unoes Othenise Stated) 1 PROPERTY AND EQUIPMENT (continued) Depreciston charged fo operations ae a oows: Seconbee 2000 December 2008 uss US Seling Tre 612,080 General and administrative e792 asiez7 Cost of rental heavy equipment 378,098 191422 Total 763,534 1.506.028 ‘The Company's land are under “Hak Guna Bangunan (HGB)" (non-ownership with limited duration) and "Hak Mii of December 31, 2009, the related lancrights under HGB will expire between 2017 to 2038 and the Company's management believes that these rights are renewable upon thelr expiry Property and equipment, except for land, are covered by insurance against losses by fire and other risks under blanket policies of Rp220, 186,000,000 (equivalent USS21,§32,127) as of December 31, 2009 and Rp158,620,000,000 {equivalent USS17, 194,580) as of December 31, 2008, which the Company's management believes thatthe insurance | adequate to cover possible losses arising from such risks. ‘As of December 31, 2009 and December 31, 2008, the Company's management believes that there is no events or Conditions that may indicate impairment of assets. Leased assets are acquired through financing from PT Orix Indonesia Finance. The leased assets are pledged against the related finance lease obligations. 24PT HEXINDO ADIPERKASA Tok NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended Decomber 31, 2008 and 2008 (Expressed in US Dotrs, unless Otherwise Stated) 72, SHORT-TERM BANK LOANS ‘This account represents short-term bank loan cbtained fram various banks, as follow: December 2009 Docombor 2008, USS ‘he Bank of Totyo-Mitaish UR, Lx 15,000,000 Total 15,000,000 16,000,000 ‘The Banko Tokyo Misi UF Li “The Company and PT Hach Construction Machinery Indonesia etained @ muti-curency loan fait fem The Bank of Tokyo. Mitsubishi UF Lid, Jakarta (BTMU Jakarta) wth a maximum creat fect of US$25,000,000 and USS49,000,000, respec “The tem of this fait is 38 months since dae ofthe agreement. The oufstancng principals ea the date of payment of he interest every mont but subject orl-over every date of payment of intrest unt the end of ce faciity. The fan bears Interest {10.26% above LIBOR per year for 2009 and 2008. Tis loan is guarantee by Hitachi Construction Machinery Co. Lid. Japan, 8 shareholder. The outstanding balance as of December 31, 2009 and December 31, 2008 are USS15, 000,000 and UISS1,000,000, respectively. “The losn obtained fom The Bank of Tokyo Mitsubishi UFJ, Lid. Singapore (TMU Singapore) fs @ mult curency oan fect for the Company ands ested partes (Le. Hilachi Construction Machinery Asia and Pact Pe. Ld, Singapore Hitachi Construction Machinery Thaland Co., Lid, Taland, PT Hitachi Consttuction Machinery Indonesia, Htachi Consicton Machinery San, Bhd, Malaysia and Cableprice (NZ) Limited) with a maémum cred acy amounting to USS30,000,000, ‘The term ofthis Fait is 98 months since date ofthe agreement. The oustanding principal is due atthe date of payment ofthe interest every month but subject 0 rl-over every dat of payment of intrest unt the end fered fait. The oon bears interest ‘0.25% above LIBOR per year. ‘On July 28, 2009, the Company obtained an unsecured short Lem working capital fait from The Bank of Tokyo-Mitsubishi UFJ, Uc, Jakarta Branch witha maximm credit faclty of US$ 10,000,000. Avaiabity period on July 22, 2008 - March 31, 2010. Te loan bears interest at 0.70% above SIBOR per yer. Each oon can be drawdown through BIMU Singspore andor BTMU Jara, Thien granted by Hitachi Consrustion Machinery Co Lad, Sapna shareholder. “The related lean agreements vith BTMU Jakarta and BTMU Singapore contain certain restriction an the Cempany, among others, change ofits business, and sel lease transferor lnerwise dispose substantial pat of is assets, unless such acta is made in. the ortnary course ofthe Company's business, Cink NA (On ie 5, 2006, tbe Company cba a short-term working capt aility fom Cisbank, NA. Jakarta with maximum ee: ily of 'USB15,000,000 "This oa ait ave been extended seve ins, tlt was ui June 5,201. The lan bers interes at 075% above [LIOR per year and ie payable in 3 mons PL sh i (On Apri'24, 2009, the Company obtained a short term werking capital faci from PT Bank Mizuho Indonesia wih @ maximum credit faity of US$10,000,000. Tis Ian faciity have been extended several times, the lest was until July 27.2008, The loan bears inforest at 0.75% above SIBOR per year, Is payable in 3 months. The laan contains certain restriction an the Company, ‘among others, o consolidate wih o merge into any ther corporation and change oe buslness 13. TRADE PAVABLES THIRD PARTIES Details ude payables hd partesin relation with purchases of goods and avis are a flows December 2008 December 2008, USS USS Heavy equipment 129,453, “419,913, Spare pats 1.485.003 41201/340 Repairs and maintonance ‘585,543 “on 372 others 1437-260 249.281, Totat 3.738377 ZSTI,506 xeon Current and les than 3 months 120.453, 419913 3-6 months é : ‘Over 6 months - 1 year : : (Overt year : Totat [es eePT HEXINDO ADIPERKASA Th NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2008 and 2008 (Expressed n US Dollars, unless Othervice Stated) 42. TRADE PAVABLES— THIRD PARTIES (Continwed) Srare-pnts ‘Current and less than 3 monthe 1485,093, 41201,340 3-6 months 5 (Over 6 months - 1 year : Over 1 year Total Rensissnd Current andiess than 3 months 686.543 ronsre 3-6 months : Over 6 months - 1 year : Over 1 year 2 Total Be TT ‘sof December 31, 2009 and 2008, the aging of alia payables - third pares was Curent and less than 3 months 14, OTHER PAYABLES - THIRD PARTIES ‘This sccount consists of December 2008 USS. Heavy equipment 12,496,087 Spe pars 112271 27.184 Service and Maintanance 11331 13.230 Others 720220 Total 5267 671 48 ACCRUED EXPENSES “This account consists of: December 2009, December 2008 USS: Salaries ard employer” benefits 1,969,618 865,008 Interest 67.393, 183,085, Marketing expenses 10,986 435, 3414275 ters. zaps crete 765.413 Tota! 12,526,462, 227.844 46, TAXES PAYABLES “Tses payable represts income aes payableson December 2000 December 2008 Estimated tax payable in curent USS. period 8,730,020, 4.057.221 ‘The ther tmees payables ‘ile 2126 wire 551.489 ‘ile 2326 45,263, 28610 Ale 4(2) 8.061 Artie 25 2,856,605. Total ERIE 7:301,995 Income Tox Expense Curent ‘The reconciliation between income before income tx, a shown inthe statements of income and taxable income for nine months ended December 31,2009 and forthe year ended December 31, 2008, area falls: December 2000 December 2008, USS: uss Income before income tax expense er statement of income 9.413.433 25,041,600 Add (deduct) temporary ferences: Provsion (reversal of alowance) for Inventories obsolescence 692,108 715,658 Inventories witten-off (683,409) Provision for employee benef : 400,136 Payment of employee benefits : 01.725) Depreciation of rope sn equipment 2227318) (98.948) Deposition ofleased ass 69,906, 54,535, Depreciation -Asets leased z Provision fr doubt accounts 164.860 208,343 Revers ofallonance for dou acouns 622220) - Finance lease receivables 35,269 ain on seo property and equipment (21,758) 65.77)PT HEXINDO ADIPERKASA Tok NOTES TO THE FINANCIAL STATEMENTS. For Third Quarter Ended December $1, 2009 and 2008 (rpressed in US Dolars, unless Otherwise Stated) 76. TAKES PAYABLES (continued) Added pe Donation neces income aleady ibe to ‘inal tax Rental Revenue Salres and wages Tres cent Payment of fiance le obligation Entertainment Others expenses Taxable Income oz (996,141) 3,957,408 180,708 26.242 (4595) 35,168 22's6a 31214,122 2010 (68,972) 24.545 zai 19 (8,025) 138813 347 245 26,400,692 tions of deferred income tax benefit (expense) on temporary differences between commercial and tax reporting purposes. sing the maimum tax rate of 28% and 30% for nine months ended December 31, 2009 and the yeer ended December 312008, respectively, areas follows Depreciation of property and equipment Depreciation of leased assets Depreciation on rental assets Gain onsale of property and equipment Provion fr employee - bono net Provsion for douifl accounts Provision (reversal of alowance) for Inventories cbsclescence Finance ease receivables Payment of finance lease obligation Total Reduction on tax rate Deferred income tax tenet net Taxable income Estimated Income tax expenses “The deferred tax assets and lables as of Decernbor 31, 2009 and December $1, 2008, are ae flows: Deferred tax assets ‘Alowance fr doubtful accounts ‘Alowance for vento obsolescence Estimated Fabity foe ‘employees’ benefits Defered tax acsiment Total deterred taxassets Deferred tx abies Depreciation of property and equipment Depreciation of eased assots Depresition on rental assets Finance lease reeivable Payment of finance easo bigation Interest income Gain (oss) foreign exchange Gain on sale of property and equipment “Tota deferred taxiabities Doterred tax assets - net ‘Twable income Tome tx expense -curent Prepayment of income tes: aie 22 rise 23, atee 25, ‘otal pressymentofincome tax evomber 2009, December 2008, USS USS (o79.648) (29.084) 19.574 16.360 (6,002) (49,733) 2597 62,568, «e717 86,503, 193,814 99674 1,108,099 10587 (1.687) 20.407) "525.960 175.587 (268,851 525,960 (93284) Brzt4,122 75.400,022 8,739,920 7529.54 December 2009, December 2008, USS USS 435,367 sra010 543.067 302,800 425,970 301,848 ra a (188,137) (115,500) 50,586 27.884 (6,388,755) (2,884,160) 5,304,900 4511399 67013) (atzaty 1,032,865), (1,086,986) ‘581452 396,026 (54516) 60.776) 770,652, 76,520 2.734.956 73a 266 “The compustions of income tax expense ad ta payable of December 3, 2009 and December 31,2008, areas fllows Deoember 2008 December 2008 uss" USS 31214,122 26,409 632 8,730,920 7.520.558 December 2000 ‘Hezember 2008 — USS USS. 11815,095, 1.897.848 1221373, 1560,164 5,176,579 6,301 8,018,048 Bare. 334 725 572 4.057.221 Estimated ta ese) papaPT HEXINDO ADIPERKASA Tok NOTES TO THE FINANCIAL STATEMENTS Foc Third Quarte Ended December 31, 2009 and 2008, (Expressed in US Dallas, unless Otherwise Stated) 17. LONG-TERM BANK LOAN ‘This acoount represents longterm bank loan . a8 flow: December 2009, December 2008 ‘The Bank of Tokyo Mitsubishi UFJ, Lt, Indonesia USS USS: (fp 68.604.000.000 2s of Deceriber 31, 2009 ana 7.406 886 5,927,854 Rp 64.910.000,000 as of December 31, 208) Curent maturities (1,088,287), 2,382,055) portion 6,350,590 3.505.709, Loans obiained from The Bank of Tokyo Mitsubishi UFJ, Lid. Jakarta (BTM Jekarta) are uncom ered facil fer investment ‘purposes that were obtained in December 28, 2007 and various dates in 2008 and 2009 wit a tla maximum cred acy of Rp 118,000,000,000. These loans are payable on instalment basis every manth for 3 yoars. These loans bear annual intrest a 0.50% above cost of fund fr relevant interest period as determined by TMU Jakarta, ‘The related loan agrourent slated thal the Company cannot enter into the various transactions, among others, o el, lease, transfer oc othennise dispose of part ofits assets and obtain 2 loan from any other pay, unless suen act is made in the ordinary course of the Company's business; to deciare or pay chdend to tne shareheldors; to consolidate or merge wth athe party, and to change of ts ‘composition of share cata, shareholders ce their shareholdings, composition of the Boars of Directors and Cornmissioners oils ‘Aricles of Association, without prior writin consent to BTM Jakarta, In cetation vith payment of dividend tothe shareholders, changes inthe composton ofthe Board of Directors and amencment ofits Arts of Association n 2008, the Company had obtained Consent Ltter trom ETTU on February 24, 2009, 18, FINANCE LEASE OBLIGATION ‘Lease assets are acquired through fnancing fram PT Orix Indonesia Finance, The leased acts are pledged agalnt the rested finance lease olgatione, ‘The future misimum finance leese payment required under the lease agreements ar as follows: Years. December 2009, Dovember 2008 USS uss 2009 18072 183,006 2010 19,501 30.495 zon 2.185 3.750 Total 39848 7.191 {Less amnt applicable to interest (2,288) 11.616) Present value of minimum Finance lease payer 37,550 105,575 curren mittee 16.917) (73.337) Lone erm portion 20,643 32.258 19, LONG-TERM OTHER PAYADLES ‘This account repress ong erm payables to Mitsbishi Corporation, apn, n US Dolla crreneyin elation to purchases of I unis of es ‘supe that ar leased otto PT Kam Prin Coal (Not 5. Tis aan is payable in quel inlet in yeas sl Dear average interes at 850% per year. The payablesare guaranteed by eertsin heavy egret beng least oi, The itr nallmentpayaent of tee payables re as fallows December 2009 __December 2008, USS USS 2008 : 7.907.500 2010 2.000.450 2.000458, Total 209,458 70057061 Lesaneutaplabetieest 72837) (608.954) Net 016.621 3451077 (ret mares (243,605) 494/360 Langer pation ‘m3,016 2016717 20, ESTIMATED LIABILITY FOR EMPLOYEES’ BENEETTS “This account consist of December 2000 Decerer 2008 uss uss nee beefy "940.408 4,804,700 Cree mites (65,883) ‘Long term potion 1.873.523, 1,808,708 26PT HEXINDO ADIPERKASA Tok [NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended Deoember 31, 2009 and 2008 (Cxgxezsed in US Dolla, unless Otherwise Stated) 20, ESTIMATED LIABILITY FOR EMPLOYEES? BENEFITS (Continued) The movement of exited ability for employees Benefits during the ero ae elo December 2008 uss Beginsingbalnce "606.323 Benefit costs during the period 409,302 Payment during the period (75,308) Ending tlarce 7.940.408, 24, SHARE CAPITAL, ‘The sar ownership sof December 31,209 ard Decenber 31,2008 based onthe report fom PTSirea Datapro Ped, the shares adinstetor bres, tll December 2009 Namner of Shares sada ily Pat Percentage of Starbolders Rp 100 Onnership Local Commissioner ™ Donald Chistian Sie 164,500 0.008% Diretor Tony Endroyaso 50,000 0.006% “Toru Sakai 1580,000, 0.188% Public (below 5% counership each) 149,043,000 17.850% Foreign itachi Construction Machinay Co. Lid, Japan 408,180,000 48,550% Iochu Corperaten, Japan 189,400,000 22540% itachi Constrstion Machine ‘Asa and Pcie Pe, Lid, Singipore 42,620,000, 076% Public (below 5% owrrship each) 48,162,500 5.734% Balance as of December, 942008 840,000,000, 100.0% ‘Decerbar 2008 unio of Shes Sharcholders sla ly Pad Percentage of Rp 100 Ounership. Local Commissioner Donald Chistian Sie 25,000 0.003% Direeor Tony Endeoyoso 50,000 oor Public (below 5% ‘ownership each) 1716140000 20.45% Foreign Hitachi Construction Machinery Co., Lid, Japan 408,180,000 48.50% !tochu Corporation, Japan 189,400,000 22.55% itachi Consrastion Machinery ‘Asia and Pasitic Poe, Lid, Singapore 42,620,000 sor% Public (below 5% ownership each) 28,111,000, 335% ‘lance as of Dacerber 31,2008, 340,000,000. 100.00% 22, ADDITIONAL paidin CAPITAL NET “This ccourt cons of ‘Amount USS ‘ditional pain cial, '8557,001 Stock ssenee costs (558,165) Not 7,596,836 ‘Amount 1784 4.988 43,700 4,147,160 11,289,543, 5.238.472 4.178,704 332,000 23,232,926 Amount uss 601 41,988 4,740,542 11,289,543, 5238472 1.178,704 777501 23,232,926PT HEXINDO ADIPERKASA TH NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31, 2009 and 2008 (@xpressed in US Dolers, unless Otherwise Stated) 23, CASH DIVIDENDS AND GENERAL RESERVE Inaccordane wit th minses ofthe Annual Shareholders’ Meeting of te Company held on June 29, 2009, the minutssof which were rotrized ‘by Notaral Deed No, 168 ae 164 on th sme dt of Robert Pr, SH, the shears reve to deca cash vided tating p81 560.00.00 (equivalent USE, 956 52) and Rp 19320 000.00 (equivalent USS 889,986) fr the #40000 000 shares or R109 and Rp 23 (l anount) per sre, alo appropriate fo nea eve fom tana earings amonating to RpS00, 00,000 (equivalee USS489, 08). Ths ‘ah dividends wee fly paid fo he turebolders or Aus 7, 2009 ad in September 2003. 24, NET REVENUES Detals of net revenues are as flow: December 2000 December 2008, USS USS ‘Ses and ental of heavy equipment “Td partes 119,585,578 126,622,123 Relate partes 17,484,635, 5.142.037 Sales of spare parts Tha parties 54,484,965 39,761,653 Repais and maintenance services Thi partes 39,882,182 31,481,851 Related partes 4.167.555 : Total Revenue 220,575,015 202,908,264 25. COST OF REVENUES. Desailsofeos of revere ea flows: December 2008 December 2008 Salesand rental hea equipment USS USS Begining balance of inventories 96,550.520 vasiori2 Purchasing 112.450.820 141,997/965 ‘Alla inventories fr sales 149,020:349, 156;317,685 ‘Allowance for inverteries obsolescence 5 Ending tnventeres 31,787,735) (48,07 672) Cost o sles and renal heavy equipment 117.232.6146 106,409 983 Spare pars: Begining balance of inventories 53,960,265 Purchasing 40,281,108 ‘Avalablepats inventories 9424465 ‘Alowance fr inentaries obsolescence 1.378.553 787,706 Ending balance of part inventories (51714894) 51,422,971) Cost of spare pars sales 33,005,162, 23,445.156 Repairs and maintenance services cost 27,485,180 23:572.162 Total cost of revenue 179622.976 153,427,509, 26, OPERATING PXPENSES, Details of pesing experses ave a fallow December 2008 December 2008, 2 Seling Expenses: uss USS Salaries, wages and employee benefits 445577708 5.018.840, Traveling 11522,980.73 tavern Depreciation 778646.14 ‘12/980 (Communication 458,11428 380.483 Warehcusing and shiping 446,113.62 508,135 “Transporation 2,255,681.55 2,247,096, pais and maintenance 187275.15 ‘st.191 Entertainment 20,776.68 127.982 Rental 208/947:55 148.817 Alter sales services 813,178.77 586,035 “Training and esveation 178.918.01 274,716 Professional feos 449,288.52 429;362 ‘Sales and promotion 124,392.78 168.118, “Total seting expenses 11,808,022 12,096,512, 0PT HEXINDO ADIPERKASA Tok NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December 31,2009 and 2008 ‘(Expressed in US Dolars, unless Otherwise Stated) 26. OPERATING EXPENSES (Continued) » General and Administrative Expenses: Salaries, wages and employee benefits 4.122888. 4041,930 ‘Stationery and office supplies 2.567,084.06 2:387/700 Depreciation ern 79183 ‘4811627 pais and maintenance 421.054.85, 420.975, Communication| 390.245.50 324,126 Bank charges 66,857.10 71,720 Asutansi 397,505.08, 347,203 Water, gas an electcty 402,227.82 341,056 Toes 8747308, yor.32 Donation 20,776.88 24.060 Membership 21,498.21, 23,408 Otners 8 “Total General and administrative expenses, 396,930 al “Total Operating expenses 21,284 960 20812435, 27 INTEREST INCOME ‘This account represents interest income from ecomber 2000 December 2008 USS USS “Time Deposst - - Curent accounts 72,184 50.972 Financing leases 319.958 11368.038 Trade receivables 001 19672 Total Fis 942 aa 682 28. INTEREST EXPENSES. “This account represents interest pense cn: Dosombor 2000 ecomber 2008 USS USS ‘Bank loons 850,452 483,192 Finance leases 6,300 14,768, Longer othe payables 342/635 835,662 Total 7.208.265, T3302 28, MONETARY ASSETS AND LIABILITIES IN FOREIGN CURRENCIES: ‘sof December 31,2008, the Conpary hus nonetary ass andihltiesdenominaed in eign cree flows auivatent ia Foreign Currencies Uss' Assets (Ca on an orks pian 1g 31,490,638,668 Jopan Yen uPy 1,988.818.19 ‘Trade rooeables Rupiah or 36,288,316,308 [Now Trade receivables Rupiah 10R 292,549,625 “Total Assets Liabities “rade psables Rupiah 10R 23,506, 484,020 2,501,303, AUD AUD 3981.51 3.553 EURO € 153.58 zat aan Yen wPY_835,692 9,042 300 860 21,045.58 15639, Other payables Rupiah or 6,127,128,047 651,026 ‘sco ‘SCD 55 830.00 39,785 EURO € 308.32 31 YEN wPr 30,251,148 sare ‘Bankloan Short em Rupiah IR 5 800,328,947 or7.155 ‘Bankloan - Long potion Rupiah 1oR63.803,605.414 6,788,710 ‘otal Libis 10,955,578 [Net monetary lilies 3,697,827, atPT HEXINDO ADIPERKASA Tok [NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended Dacember31, 2009 and 2008 (Expressed in USS Unless Otherwise Stated) 30, SIGNIFICANT AGREEMENTS AND COMMITMENTS Royalty Agreement In May 1999, the Company entered into royally agreement with Hitachi Construction Machinery Co, Lid, Japan (HCMJ),@ sharehokler. Based on tis agreement, HCR agreed to furish the Company wit cense, technical information and traning in order to reranufacture heavy equipment components. As compensation, the Company shall pay HCN royalty fe forthe lence at 1 of certain product sales and technical assistance services related to heavy equipment component remanufacturing, Ths agreement ‘expired on December 31, 2008. Distributorship Agreements, ‘The Company has several distrbutorship agreements in elation fo the sale of cera heavy equipment adits spare pars wth several [censed companies, among others, HCMJ, Hitachi Construction Machinery Asia and Paciie Pie, Lid, Singapore (HMAP), a shareholder, PT Hitachi Construction Machinery Indonesia, related party. ‘The above agreements generally cove a period of 1 year to 3 years and can be extended from tie fo time as agroed wih the above companies. The agreements require the Company fo achieve certain sales targets and provde aller sles earvcw on the heavy ‘equipment so ‘Threo Parties Sales and Purchase Agreement ‘The Company entered into @ three parties sales and purchase agreements wth HMAP and a certain customer, whereby the Company was eppoined as sales agent on sales of heavy equipment fam HMAP to certain customer in Indonesia. Based on these ‘agreements, the Company s response o provide service warranty that canbe csimed back to HMAP and maintenance support for the heavy equipments sol and administer and ful respensibe fr collection of any payment incurted fram the transaction 'As compensation, the Company received commission fee and adminitration revenue from HMAP for coletion of receivable based on the certain percentage of the sales price of heavy equipment and collected receivables which i recorded as par ofthe "Net Revenues” account inthe stalements of income. ‘Commission Agreement ‘The Company entered inlo'@ commission agreement with HCML, whereby based on the agreement, the Company recehes ‘commission fee from HCMJ based onthe certain percentage ofthe sales price of heaiy equipments sales to certain third partes. As ccompensstion, the Company s responsible o prove the techical assistance of assembling system, perform periodic inspection during the warranty ime and provide the traning to certain third partes. The commission revenue received by the Company is recorded 1s part of "Net Revenues” account in the statements of income Unused Credit Facility sof December 31, 2009, the Company has unused credit facility obtained from PT Bank Resona Perdania under promissory note loan facility with a maximum ereit facility of USS2,000,000 that has been extended until May 16, 2010.PTHEXINDO ADIPERKASA To [NOTES TO THE FINANCIAL STATEMENTS For Third Quarter Ended December31, 2009 nd 2008 (Expressed in US$ Unless Otherwise Stated) 30. SIGNIFICANT AGREEMENTS AND COMMITMENTS (Continued) Derivative Instrument - Cross Currency Swap (On September 1, 2008, the Company entered into cross currency swap contracts with Citibank N.A, Jakarta, whereby the Company ‘shall ecelve an annual interest income of 1% above the Cetficteof Bank Indonesia fem the nominal values of p28, 490 and Rp4,000at the beginning and wil be reduced by Rp,314 every month aed pay anal ntress of 5.75% and 5.60% from the nominal values of USS3,111,961 and US$1,529,219, respoctvaly, a the begining and wil be reduced by US$143.528 every month. The interests wil be received and pal on monthly basis, string frem September 2008. and each wil be metured on July 11, 2011 and December 24, 2010, respectively. Every month, the Company wil receive Rp1,314 and pay US$143,528 lo Citbank NA, Jakarta, 333. INFORMASI SEGMEN PT HEXINDO ADIPERKASA Tbk [NOTES TO THE FINANCIAL STATEMENTS. For Tied Quarter Ended December 31, 2009 and 2008 (Expressedin US Doles, Uness Otherwise Stated) ‘The following tables present certain information regarding the business and geographical segments as of December 31, 2009 and December 33, 2008 a flows ‘Sales, rontal of Hoavy Equip and Repair and commission Sales of spare__Maintonance Docomber.08 income parts service Unallocated Total Business Segment Information (Primary) ‘Segment Revenues 137,040,313 54404965 38,049,797 229,575,015 Segment Gross Proft 19807809 21271,978 9.972.368 50,952,099 ‘Segment Operating Income 16.295315 __ 20,748,720 8.255613 10,580,668) 20,657,079 ‘Sogment Aecots 43570725, __7160,108. 9.250507, 91,090.492 215,528,683, ‘Segment Uapities 3.040.167, _ 12,846,801 698.689 52,587.420 120.183.161 Geographical Segment —er—_— Information (Secondary) Sogment Revenucs Java sand 9.552.449 1,104,784 36796 : 11,024,929 Ouse Jove istane s274s7.864 __50;80,181_ _37,882.041, 218,550,006 Total Segment Revenue 137,000,313 54,484,965, 38,049,737, : 228,575,015, ‘Sogmont Gross Profi eae ‘Java sland 5,992,731 72240 210308 6,905,364 Outsioe Java istane 13874908 __ 20,500,796 9.561.971 4.046.675 ‘Sogment Gross Profit 13,807, 50,962,059 Operating Income ‘davaetand 513.224 705396 100815, (207,004) 9.221.071 Outside Java sland soerr901 __20,041.304 3,146,108 (10,373,565) 23,496,008 Segment Operating Income 15,255315 20,746,720 3,265,618 (10,580,569) 23,657,079 ‘Sales, rental of Heavy Equip and Repair and commission Sales of spare Maintenance December-08 Income parts service Unaocatod Total ‘Business Segment Information (Primary) Segment Revenues 131,964,761 99,761,659 31,481,850 : 202,908,264 Segment Goss Pratt 24467.061 16,420,842 8,593,052 49,480,955 ‘Segment Oporating Income (10.603 859 25658,522 Seginent Assets 74,920,028 50,837,206 787,252,008 ‘Segment Lsbilties 53.990408 13,536,600 ___ 1,400,728 42,618,020, 110,954,006 Geographical Segment Information (Secondary) ‘Segment Revenuos ava island 43402871 4.110.605, 283;368 : 14,816,865 Outside Java island 48 31,218481 189,091,410 Total Segment Revenue 59 31,481,850) 202,908,264at. PT HEXINDO ADIPERKASA Tbk NOTES TO THE FINANCIAL STATEMENTS. For Third Quarter Ended December 31,2009 and 2008 (©xpressed in US Dollars, Uniess Otherwise Stated) INFORMAS! SEGMEN (CONTINUED) Segment Gress Proft ‘dev lan 2zi7231 480,283 ba944 : 2,762,488 Outsice ava stand 222491830 __15.960'550. 8,508,108, ‘Sogmont Gross Profit 24467,061 _16420.862 8,583,062, : Operating Income ava isiand 2.116.498 390,765, (110.556) 215.378) 2,190,829 (Outside Jove itone 17779400 _15.484'762 3.502.416 10,388,481) ‘Sogment Operating Income 19,895,996. 15 344,827 3,531,860 (10,608,559) CHANGES ON THE REPORTING CURRENCY In accordance wth the minutes ofthe Extraordinary Sharcholiors’ Meeting ofthe Company held on June 25, 2008, as covered by Notarial [Deed No. 123 onthe same date of Robert Purba, SH, the shareholders resolved fo change the reporting curency from Rupiah to US Doli that wil be effective fr 2009 fiscal year. The change was approved by the Depariment of Fiance of Repubic Indonesia nits ‘decison letter No, KEP-158NWP,07/ WPA O7/8D.0472008