PT Harum Energy Tbk

Deutsche Bank Building 9th Floor

Jl. Imam Bonjol No. 80, Jakarta 10310, Indonesia
Phone: (62-21) 3983-1288

31 July 2023

PT HARUM ENERGY Tbk

1H 2023 Summary and Highlights
Important Note: The results provided below reflect the unaudited consolidated results of PT Harum Energy Tbk. (“the
Company”) for the 6-month period ending 30 June 2023, which include the results of PT Mahakam Sumber Jaya (“MSJ”), PT
Layar Lintas Jaya (“LLJ”), PT Santan Batubara (“SB”), PT Karya Usaha Pertiwi (“KUP”), PT Bumi Karunia Pertiwi (“BKP”), PT
Tanito Harum Nickel (“THN”), PT Harum Nickel Industry (“HNI”), Harum Energy Australia Ltd and Harum Asia Capital Pte Ltd.
The report below is prepared by the management and unaudited.

• Total coal sales volume for 2Q 2023 came at 1.8 million tonnes (“Mt”), or similar to the volume sold
in the previous quarter. In 1H 2023, coal sales volume rose by 71.8% y-o-y to 3.6Mt;
• Average Sales Price (ASP) achieved in 2Q 2023 was USD 109.8 per tonne (“/t”), or 31.8% lower q-o-q.
In 1H 2023, the Company’s ASP declined by 23.4% y-o-y to USD 135.6/t;
• In 2Q 2023, the Company’s revenues decreased to USD 197.7 million or 32.9% lower q-o-q, but in 1H
2023, revenues still rose by 30.4% y-o-y to USD 492.2 million,;
• EBITDA generated in 1H 2023 improved by 13.6% y-o-y to USD 242.0 million;
• Consolidated net profit attributable to owners of the parent in 1H 2023 reached USD 150.6 million.

Q-o-Q Y-o-Y
1Q 2023 2Q 2023 1H 2022 1H 2023
change change

Sales volume (Mt) 1.8 1.8 -1.8% 2.1 3.6 71.8%

Average Sales
(USD/t) 160.9 109.8 -31.8% 177.0 135.6 -23.4%
Price

Revenues (USD million) 294.5 197.7 -32.9% 377.5 492.2 30.4%

EBITDA (USD million) 159.1 82.9 -47.7% 213.0 242.0 13.6%

Net profit
attributable to
(USD million) 103.0 47.6 -53.8% 146.0 150.6 3.2%
owners of the
parent

Coal Production and Sales

The Company’s coal production in 2Q 2023 totaled 1.7 Mt, which brings its total coal production in the first
six months of 2023 to 3.5 Mt. In the same period, the Company managed to sell 1.8 Mt of coal, which is
similar to previous quarter’s sales. Overall, the Company’s sales volume reached 3.6 Mt in 1H 2023, or
71.8% higher than the volume sold in the same period a year ago (see Chart 1).

The Company’s Average Sales Price (ASP) declined by 31.8 % q-o-q in 2Q 2023 to USD 109.8/t from USD
160.9/t achieved in previous quarter. The decline in the Company’s ASP mirrored the decline in global coal
prices that has been on a downward trend since the beginning of the year as global commodity prices

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 PT Harum Energy Tbk
Deutsche Bank Building 9th Floor
Jl. Imam Bonjol No. 80, Jakarta 10310, Indonesia
Phone: (62-21) 3983-1288

normalized from last year’s record levels. Consequently, the Company’s ASP for the first six months of 2023
also decreased by 23.4% y-o-y to USD 135.6/t from USD 177.0/t in 1H 2022 (see Chart 2).

Due to the lower ASP, the Company recorded revenues of USD 197.7 million in 2Q 2023, compared with
USD 294.5 million in 1Q 2023 or 32.9% lower q-o-q. Nevertheless, since the Company had successfully
increased its sales volume significantly in 1H 2023, in spite of the lower ASP, the Company still managed to
generate revenue of USD 492.2 million, or 30.4% higher y-o-y than the USD 377.5 million recorded in 1H
2022.

Chart 1 – Coal Sales Volume (Mt)

1.8 1.8 1.8

1.2 1.2
0.9

1Q 2022 2Q 2022 3Q 2022 4Q 2022 1Q 2023 2Q 2023

Coal Production Cost

In 2Q 2023, the overall production cash cost per tonne (/t) decreased by 13.6% from the previous quarter
mainly due to lower royalty expense/t and lower average fuel price.

For the first six months of 2023, the Company’s overall production cash cost/t declined 11.4% y-o-y, which
also resulted from lower royalty expense/t and lower average fuel price.

Chart 2 – Average Sales Price (USD/t)

ASP (USD/t) Stripping Ratio (x)

USD/t x
240 12
10.2x 10.2x
9.8x
200 9.2x 10
8.9x
7.5x
160 183.3 183.4 8
168.4 165.7
160.9
120 6

109.8
80 4

40 2
1Q 2022 2Q 2022 3Q 2022 4Q 2022 1Q 2023 2Q 2023

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 PT Harum Energy Tbk
Deutsche Bank Building 9th Floor
Jl. Imam Bonjol No. 80, Jakarta 10310, Indonesia
Phone: (62-21) 3983-1288

Nickel Mining & Refining

The Company’s nickel mining subsidiary, PT Position (POS), continued to progress with the various
permitting process, which is required prior to construction of the mining infrastructure and other pre-
operating activities.

For the first six months of 2023, the Company’s 49% owned smelter, IMI, successfully produced 12,221 ton
of Ni metal equivalent, while generating EBITDA of USD 30.0 million and a net profit of USD 26.2 million for
1H 2023.

Q-o-Q Y-o-Y
IMI (100% basis) 1Q 2023 2Q 2023 1H 2022* 1H 2023
change change
NPI Production (tonne) 40,123 45,741 14.0% 68,002 85,864 26.3%
Nickel Metal
(tonne) 5,935 6,286 5.9% 10,552 12,221 16.2%
Production
EBITDA (USD million) 19.9 10.1 -49.0% 47.0 30.0 -36.1%

Net Profit After Tax (USD million) 17.9 8.3 -53.6% 41.5 26.2 -37.0%
*) 1H2022 data is shown for information purposes, but the utilization rate was low as it was still in trial production period. Commercial
production started in April 2022.

The Company’s second smelter at its associate company, PT Westrong Metal Industry (WMI), is currently
in late stage of construction. As previously announced, WMI will have four lines of RKEF smelter designed
to produce annually up to 56,000 ton of Ni metal in the form of NPI and high-grade nickel matte. In June
2023, the progress of civil construction at WMI has reached nearly 90%, and the smelter is expected to
commence commercial production in stages starting from 4Q 2023, which will support the continued
growth of the Company’s nickel production going forward. In addition, with the flexibility to produce high-
grade nickel matte, WMI is also expected to obtain stronger margins compared to lower grade NPI.

WMI development progress (as of June 2023)

June 2023

Profitability

The Company recorded a gross profit margin of 45.8% in 2Q 2023, or lower from the 55.3% margin achieved
in 1Q 2023 as a result of lower ASP which more than offset the improvement in the Company’s production

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 PT Harum Energy Tbk
Deutsche Bank Building 9th Floor
Jl. Imam Bonjol No. 80, Jakarta 10310, Indonesia
Phone: (62-21) 3983-1288

costs. Year-on-year, the Company recorded a lower gross profit margin of 51.5% in 1H 2023 compared with
a margin of 64.8% in 1H 2022 when the Company’s ASP was much higher.

In 2Q 2023, the Company generated a quarterly EBITDA of USD 82.9 million or 47.9% lower q-o-q than USD
159.1 million generated in 1Q 2023. The lower EBITDA is due to lower ASP in the second quarter, which
more than compensated the decrease in production costs during the period. In the first 6 months of 2023,
the total EBITDA generated is USD 242.0 million, or still 13.6% higher than the USD 213.0 million generated
in 1H 2022. The EBITDA margin in 1H 2023 decreased to 49.2% from 56.4% in 1H 2022 due to the lower
ASP.

The Company recorded a positive USD 21.1 million share of profit from associates for 1H 2023, the majority
of which came from its investment in IMI and Nickel Industries Limited (NIC).

Due to the above factors, the quarterly consolidated net profit attributable to the owners of the parent in
2Q 2023 was USD 47.6 million, or 53.8% lower q-o-q. Nevertheless, for the first six months of 2023, the net
profit attributable to the owners of the parent still increased to USD 150.6 million from USD 146.0 million
in 1H 2022. The net profit margin decreased to 30.6% in 1H 2023, compared to 38.7% in 1H 2022.

Balance Sheet

During the first six months of 2023, the Company continued to maintain a robust and liquid balance sheet.
As of 30 June 2023, the Company recorded total assets of USD 1,367.0 million or 6.9% higher than USD
1,278.8 million recorded at the end of 2022.

The Company’s current assets decreased to USD 513.4 million as of 30 June 2023, or 1.1% lower than USD
519.3 million recorded as at 31 December 2022. As of 30 June 2023, the Company maintained a cash and
cash equivalents balance of USD 357.5 million with no outstanding bank loan.

The Company’s non-current assets increased to USD 853.7 million as at 30 June 2023 from USD 759.5
million as at 31 December 2022. The net movement of non-current assets mainly came from the
investment advance made to PT Blue Sparking Energy, amounted to USD 100.0 million.

Total capital expenditure in the first six months of 2023 was USD 12.9 million in relation to (i) addition of
mine properties in MSJ, KUP and THN; (ii) maintenance expenditure for the barging fleet owned by LLJ; as
well as (iii) purchase of vehicles and heavy equipment.

The Company’s total liabilities as of 30 June 2023 stood at USD 184.1 milion, or 35.7% lower than USD
286.5 million recorded at the end of 2022. The decrease was primarily driven by the decrease in dividend
payables and taxes payables which were partially offset with the increase in trade payables.

The equity attributable to owners of the parent as at 30 June 2023 was USD 885.7 million, which reflects a
20.6% increase from the position as at 31 December 2022, due to the additional income generated during
the period.

The Current Ratio (defined as the ratio of current assets to current liabilities) as at 30 June 2023 is 4.2x.

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 PT Harum Energy Tbk
Deutsche Bank Building 9th Floor
Jl. Imam Bonjol No. 80, Jakarta 10310, Indonesia
Phone: (62-21) 3983-1288

Environment, Health and Safety

During 2Q 2023, there were no lost time accidents and no environmental incidents across the Company’s
operations.

Marketing

The Company’s coal sales during the first six months of 2023 were sold to China (46%), followed by
Indonesia (24%), Japan (20%), Bangladesh (6%), India (1%), Thailand (1%), Vietnam (1%) and Taiwan (1%).

1H 2023 Coal Sales Volume by Destination

Thailand Vietnam
India 1% 1% Taiwan
1% 1%
Bangladesh
6%
Japan
20% China
46%

Indonesia
24%

***

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 PT Harum Energy Tbk
Deutsche Bank Building 9th Floor
Jl. Imam Bonjol No. 80, Jakarta 10310, Indonesia
Phone: (62-21) 3983-1288

3Q 2023 Outlook

Operations
Operations at MSJ will continue to ramp up production volumes quarter on quarter. 2Q 2023 overburden
removal was higher by approximately 20% versus 1Q 2023; again, 3Q 20233 is forecast to increase volumes
from 2Q 2023 by a similar percentage. The increase is a combination of drier weather and the mobilisation
of additional mining equipment. Coal production will remain flat, resulting in slightly higher strip ratios
through 3Q 20233 v 2Q 2023. MSJ is still on track to meet its annual target of 6MT this year.

At SBB, operations continue to expand from the recommencement of mining during 1H 2023, with the first
coal sales targeted for this quarter. SBB's production levels will stabilise at current 3Q 2023 levels through
to the end of this year. In the coming quarter, the Company's primary aim is to commence an extensive
drilling programme within a highly prospective block at SBB. No previous mining has taken place in this
block. The drilling plan consists of 337 holes which will increase geological confidence to meet JORC
classification for resources and reserves.

Markets and Sales

With 1H 2023 demand relatively flat year on year for most importing countries, Chinese demand continues
to be strong and remains the determining pricing factor, with any slight deviation from the fragile
supply/demand balance causing rapid changes within a narrow price range. Chinese domestic production
reached 1.9 billion tonne for January to May 2023, a record period for coal output. This increased supply
has been matched with higher coal burn of 10% year on year, due to higher overall electricity demand and
lower hydro power generation. Record temperatures in June and July have ensured consistent demand for
imported coal.

As we move into the autumn season, it is likely that China will reduce its overall coal consumption which
may dampen prices for imported coal. At the same time, Indonesian domestic production in May reached
record levels of 65.7Mt, with 1H 2023 production annualising at 719.5Mt - an increase of 5% year on year.
Indonesian miners have however begun to react to the lower pricing and high cost environment, with many
expected to reduce production in 3Q 2023 should the current levels persist. The current royalty structure,
especially for higher CV coal, continues to make Indonesian coal relatively uncompetitive against other
origins and miners now also face the DHE (Dana Hasil Ekspor) regulation - a new regulation requiring 30%
of export proceeds to be placed into an escrow account for 3 months, which could adversely impact
working capital cashflow and prompt a quicker supply response.

There are, however, a few bright spots. Both Pakistan and Vietnam, which have been notably absent for
the 1st half of the year have recently shown indications of returning to the market for Indonesian mid-cv
coal. In addition, the Indian government's directive for import-coal based power plants to operate at full
capacity until September will ensure a steady flow of South African and Indonesian cargoes.

Overall, with ample supply and buying countries seemingly well stocked, we expect pricing to remain
rangebound for 3Q 2023 and into 4Q 2023.

***

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 PT Harum Energy Tbk
Deutsche Bank Building 9th Floor
Jl. Imam Bonjol No. 80, Jakarta 10310, Indonesia
Phone: (62-21) 3983-1288

SUMMARY FINANCIAL STATEMENTS

Consolidated Statements of Profit and Loss
For the six months ended 30 June 2022 and 2023

Consolidated Statement of Profit or Loss (in USD millions)

Unaudited Unaudited Unaudited Unaudited
Description 1Q23 2Q23 % chg 6M22 6M23 % chg
Revenues 294.5 197.7 -32.9% 377.5 492.2 30.4%
Cost of revenues & direct costs (131.7) (107.2) -18.6% (133.0) (238.9) 79.7%
Gross profit 162.8 90.6 -44.4% 244.5 253.4 3.6%
Operating expenses (18.6) (24.1) 29.6% (44.1) (42.8) -3.0%
Operating profit 144.2 66.4 -53.9% 200.4 210.6 5.1%
Depreciation and amortization 15.0 16.5 10.1% 12.6 31.4 148.9%
EBITDA 159.1 82.9 -47.9% 213.0 242.0 13.6%
Share of profit of associates 14.7 6.4 -56.8% 26.7 21.1 -20.9%
Other income (expense) 0.8 1.1 34.7% 0.6 2.0 208.8%
Profit before income tax 159.7 73.9 -53.7% 227.7 233.7 2.6%
Income tax expense (32.1) (15.0) -53.2% (44.0) (47.2) 7.2%
Profit for the period 127.6 58.9 -53.9% 183.7 186.5 1.5%
Attributable to:
Owners of the parent 103.0 47.6 -53.8% 146.0 150.6 3.2%
Non-controlling interests 24.6 11.3 -54.1% 37.7 35.9 -4.8%

Gross profit margin 55.3% 45.8% 64.8% 51.5%

Operating profit margin 49.0% 33.6% 53.1% 42.8%
EBITDA margin 54.0% 41.9% 56.4% 49.2%
Net profit margin 35.0% 24.1% 38.7% 30.6%

Coal sales volume (mi l l i on tonne) 1.8 1.8 -1.8% 2.1 3.6 71.8%
Coal production volume (mi l l i on tonne) 1.7 1.7 -2.4% 2.3 3.5 49.1%
Monthly coal production run rate (mi l l i on tonne) 0.6 0.6 -2.4% 0.4 0.6 49.1%

Average coal sales price (US$/tonne) 160.9 109.8 -31.8% 177.0 135.6 -23.4%

Stripping ratio (times ) 7.5 9.8 9.5 8.6

Overburden volume (mi l l i on bcm) 13.1 16.7 27.5% 21.9 29.8 36.0%

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 PT Harum Energy Tbk
Deutsche Bank Building 9th Floor
Jl. Imam Bonjol No. 80, Jakarta 10310, Indonesia
Phone: (62-21) 3983-1288

SUMMARY FINANCIAL STATEMENTS

Consolidated Statements of Financial Position
As of 31 December 2022 and 30 June 2023

Consolidated Statement of Financial Position (in USD millions)

Audited Unaudited
Description 31-Dec-22 30-Jun-23 % change
Cash and cash equivalents 370.5 357.5 -3.5%
Trade receivables 69.3 38.6 -44.3%
Inventories 43.2 31.3 -27.6%
Advances - 100.0 n/a
Prepaid Taxes 4.0 19.1 374.5%
Prepaid Expenses 4.6 12.0 159.7%
Deferred tax assets 4.8 5.1 7.2%
Goodwill 3.9 - -100.0%
Investments in an associate 389.4 408.1 4.8%
Fixed assets 51.9 48.9 -5.7%
Mine properties 273.3 258.9 -5.3%
Other assets 63.9 87.5 36.9%
Total Assets 1,278.8 1,367.0 6.9%

Trade payables 20.9 44.7 114.5%

Taxes payable 75.2 23.4 -68.8%
Accrued expenses 62.2 50.8 -18.5%
Dividend payable 63.2 - -100.0%
Deferred tax liabilities 45.3 45.3 0.0%
Employee benefits liability 8.9 9.6 8.5%
Provision for environmental management 8.1 8.1 0.2%
Other Liabilities 2.8 2.2 -21.8%
Total Liabilities 286.5 184.1 -35.7%

Equity attributable to the owners of the parent 734.3 885.7 20.6%

Non-controlling interests 257.9 297.2 15.2%
Total Equity 992.3 1,182.9 19.2%

Net debt/(net cash)* (370.5) (357.5)

Net debt/(net cash) to equity (x) (0.5) (0.4)
Current ratio (x) 2.3 4.2
Trade receivables days 19 20
Trade payables days 19 25
Notes:
*) Defined as total debt, which consist of bank loans and finance lease obligations, minus cash and cash equivalents

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 PT Harum Energy Tbk
Deutsche Bank Building 9th Floor
Jl. Imam Bonjol No. 80, Jakarta 10310, Indonesia
Phone: (62-21) 3983-1288

SUMMARY FINANCIAL STATEMENTS

Consolidated Statements of Cash Flows
For the six months ended 30 June 2022 and 2023

Consolidated Statement of Cash Flows (in USD millions)

Unaudited Unaudited
Description 6M22 6M23 % chg

Cash Flows From Operating Activities

Cash generated from operations 362.0 523.0 44.5%
Cash paid related to operations (200.3) (346.7) 73.1%
Net Cash Provided by Operating Activities 161.7 176.3 9.0%

Cash Flows From Investing Activities

Additions to mine properties (4.1) (11.8) 186.4%
Additions to fixed assets (0.6) (1.0) 62.7%
Payment of docking expense (0.1) (0.8) 741.7%
Receipt of dividend 2.4 2.4 -2.1%
Advance to third party - (100.0) 100.0%
Placement of mine reclamation & closure guarantees (2.4) 0.1 106.0%
Acquisition of associate (75.0) - -100.0%
Addition to investment in an associate (4.1) - -100.0%
Capital contibution from NCI 0.0 3.2 4571095.8%
Others 1.2 4.8 313.9%
Net Cash Used in Investing Activities (82.8) (103.1) 24.4%

Cash Flows From Financing Activities

Reissuance of treasury shares 42.6 - -100.0%
Payment of cash dividend (14.1) (63.6) 352.2%
Receipt/(Addition) of other receivable to related party - (22.0) 100.0%
Others (2.9) (0.6) -77.8%
Net Cash Used in Financing Activities (17.6) (86.2) 390.4%

Net Increase in Cash and Cash Equivalents 61.2 (13.1) -121.3%

Cash and Cash Equivalents at Beginning of the Year 149.4 370.5

Cash and Cash Equivalents at End of the Period 210.6 357.5

For further information, investors and shareholders can contact:

PT Harum Energy Tbk

Corporate Secretary
email : corsec@harumenergy.com