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COMPANY PROFILE Q2

PT. PAN BROTHERS Tbk.& SUBSIDIARIES

With Integrity, Commitment, Precision and Passion for the Company’s Enhancement

CONTENTS

2

COMPANY OVERVIEW 3

PT. Pan Brothers Tbk. & Subsidiaries

FINANCIAL OVERVIEW 18

APPENDIX 22

3

COMPANY OVERVIEW

• Indonesia’s largest listed garmentmanufacturer.

• Well-established business founded in 1980 andlisted on the Indonesia Stock Exchange since1990.

• Strong export focused-markets include US,Europe, Asia, Canada, Australia and NewZealand.

• Long-standing relationships with numerous topglobal fashion and apparel brands, whilemaintaining a strong CSR/work ethics.

• Plants located in Tangerang, West Java andCentral Java with 26,626 machines andproduction capacity of 90 million pieces ofgarment by the end of 2016.

• Selective expansion to both upstream anddownstream segments.

PT. PAN BROTHERS Tbk.

Vision:TO BE AN INTEGRATED AND WORLDWIDE APPAREL SUPPLIER


4

GROUP STRUCTURE

5 PT. Pan Brothers Tbk. & Subsidiaries

PT. PAN BROTHERS TBK.

PT. Trisetijo ManunggalUtama27.98%

Public52.16%

PT. Ganda Sawit Utama19.86%

Continent 8 Pte. Ltd. (51.00%)

PT. Hollit International (51.04%)

PT. Pancaprima Ekabrothers (99.91%)

PT. Ocean Asia Industry (51.00%)

PT. Apparelindo Prima Sentosa (99.00%)

PT. Eco Smart Garment Indonesia (85.00%)

Cosmic Gear Limited (51.00%)

PT. Prima Sejati Sejahtera (99.00%)

PT. Teodore Pan Garmindo (51.00%)

PT. Victory Pan Multitex (51.00%)

PT. Berkah Indo Garment (99.00%)

* As of August 16, 2016 PT TMU share increase from 26.33% to 27.98%

PB International B.V. (100.00%)

GROUP OVERVIEW

6

• Started in1980.

• ManufacturesWovenGarmentssuch asPadded andLight WeightJackets,Pants, Shortsand CasualPants as wellas Cut andSewn KnitGarmentssuch as PoloShirts, GolfShirts, TrackSuits, SweatSuits

• Acquired in2005.

• ManufacturesTechnical,Functionaland ActiveWear Jacketsand OuterWear suitedfor SnowBoarding,Skiing,Jogging,Hiking, andother Sportsand OutdoorActivities

• Established in2013 as a JVwithMitsubishi.

• Planned tobuild 6garmentmanufacturingfacilities

• 4 Facilitiesalready builtin 2014.

• And expansionof ESGIexpected tofinish by 2017.

• Manufactureswovengarment


• Established in2014.

• ManufacturesTechnical,Functionaland ActiveWear Jacketsand OuterWear suitedfor SnowBoarding,Skiing,Jogging,Hiking, andother Sportsand OutdoorActivities


• ManufacturesCut and SewnKnit Garmentssuch as PoloShirts, GolfShirts, TrackSuits, SweatSuits

Garment ManufacturingBusiness

Group Companies

Brief Description

PT Teodore

Pan Garmindo

“TPG”“PSS”

PT Eco Smart

Garment

Indonesia“ESGI”

PT Pancaprima

Ekabrothers

“PPEB”

PT Pan

Brothers Tbk

“PBT”


• ManufacturesWoven Garmentsuch as CasualShirts, Tops,Casual Bottoms,Casual Shorts,Denims,GarmentDyeing.

PT Berkah Indo

Garment

“BIG”

• Started in 2013.

• Incorporated in Indonesia to engage in apparel retail business

• Launched its women’s fashion brand, ZOE black in 2013.

• JV men’s fashion brand , Salt n Pepper in 2015.


• Produces various kinds of knit fabrics, such as single knits and double knits (Single Jersey and Lycra Single Jersey, Pique and Lacoste, Fleece / French Terry Interloop / Lycra Interloop, Jacquard Jersey) and flat knits.

• Established in 2014.

• Produces various Sewing and embroidery thread.

• Incorporated in Hong Kong to help the group better cater the international market.

• Engages in product development and material sourcing.

• Incorporated in Singapore.

• Engages in sourcing activities that will allow the Group’s products to reach more international markets.

• A product development company focusing on the development and creation of latest trends in styling, finishing and material.

• Acquired in 2011.

• A product development company focusing on the development and creation of latest trends in styling, finishing and material.

• Also manages the collection and production of world renowned fashion brands.

GROUP OVERVIEW

7

RetailFabric SupplySewing &

Embroidery Thread

Product Development and Marketing Business

Group Companies

Brief Description

PT Hollit

International

“Hollit”


PT Apparelindo

Prima Sentosa

“APS”

PT Ocean Asia

Industry“OAI”

PT Victory

Pan Multitex

“VPM”

Cosmic Gear

Limited“Cosmic”

Continent 8

Pte Ltd

“C8”

PB International

BV

&

PB Fashion B.V


• Engaged in business as Apparel Buying Agent and Product DevelopmentCompany, etc, set-up to support Europe activities.

PBRX MILESTONE


2013

2007

1980

2005

2012

2011Established PBT (Cut &

Sewn Knit OEM Factory)

Established PBT (Cut &

Sewn Knit OEM Factory)

a) Expansion of PPEB at

Boyolali (Woven

Factory)

b) Expansion of PBT at

Sragen (Woven

Factory)

a) Expansion of PPEB at

Boyolali (Woven

Factory)

b) Expansion of PBT at

Sragen (Woven

Factory)

Acquired PPEB (Light &

Heavy Woven Jacket

Factory)

Acquired PPEB (Light &

Heavy Woven Jacket

Factory)

Set up OAI (Apparel

material

manufacturer)

Set up OAI (Apparel

material

manufacturer)

a) Expansion of PBT at

Boyolali (Woven

Factory)

b) Expansion of PPEB at

Boyolali

(Woven Factory)

a) Expansion of PBT at

Boyolali (Woven

Factory)

b) Expansion of PPEB at

Boyolali

(Woven Factory)

a) Set up APS (Apparel Retail

and Brand)

b) Set up ESGI (Woven Factory)

a) Set up APS (Apparel Retail

and Brand)

b) Set up ESGI (Woven Factory)

2014

Set up Cosmic Gear

(Product Development)

Set up Cosmic Gear

(Product Development)

a) Set up TPG at Bandung

(Cut & Sewn Knit Factory)

b) Set up VPM at Bandung

(Sewing and Embroidery

thread)

c) Set up PSS at Boyolali

(Woven Factory)

a) Set up TPG at Bandung

(Cut & Sewn Knit Factory)

b) Set up VPM at Bandung

(Sewing and Embroidery

thread)

c) Set up PSS at Boyolali

(Woven Factory)

2016

a) Set up Berkah Indo

Garment at Ungaran and

Demak (Woven Factory)

b) Set up PB International BV

(Buying Agent and Product

Development Company)

a) Set up Berkah Indo

Garment at Ungaran and

Demak (Woven Factory)

b) Set up PB International BV

(Buying Agent and Product

Development Company)

INDUSTRY OUTLOOK

• Textile and garment exports from Indonesia are expected to growfrom US$13.2bn in 2015 to US$ 75.3bn in 2030

• Proportion of Indonesian exports in total global demand to rise from 1.8% in 2015 to 5% in 2030.

Strong Outlook Despite Global Uncertainties

• Economic policies packaged issued for labor intensive industries;tax incentives, electricity tariff discounts and employee taxdeduction

• FTA with the European Union expected to be signed in 2017• Government has expressed support of strengthening domestic

manufacturing industry and reducing dependence on commodity-based exports

Indonesian Government Support

on Textile & Garment Industry

• China faces rising labor cost and lack of labor supply.• India & Bangladesh are constrained by inadequate infrastructure

and rising labor wages.• Vietnam & Cambodia have smaller workforce relative to Indonesia

and are constrained by rising labor cost.

Key Asian Garment Suppliers Face

Growth Constraints

• Indonesia has huge population of more than 260 million.• In 2030, it is expected the middle class income earners will

contribute up to US$ 1.7bn to the country’s GDP (86% of the totalGDP).

Indonesian Retail Outlook


Source: KemenPerin; Index Valuation Division API Publication; Goverment Policy Package;BPS

INTEGRATED BUSINESS MODEL

11PT. Pan Brothers Tbk. & Subsidiaries

FibreProduction

Spinning, Fabric weaving, knitting,

finishing

Designing, cutting, sewing, buttonholing, ironing

Marketing and distribution

Retail Outlets

Raw Material Production

Textile Manufacturing

Apparel Manufacturing

Branded Apparel Players

Retailers

• Actively pursuing JV / M&A opportunities into fabric mills sector.

• Set up Victory Pan Multitex as Sewing and Embroidery Thread manufacturer in

2014.

• Acquired Hollit International set up some product development company.

• Established Apparelindo Prima Sentosato increase presence in apparel retail

business, with in-house brand, ZOE

black & JV SnP

• JV / M&A with some local brands and multi-brand retailer.

��

Upstream expansion Downstream expansion

�

• Joint Venture with Mitsubishi to set up 6 factories in Central Java area and

already built 4 factories in 2014,

expansion expected to finish in 2017

• Set up Prima Sejati Sejahtera in Boyolali in Central Java in 2014

• Set up Teodore Pan Garmindo in West Java in 2014 and 2016.

Garment Manufacturing

KEY PILLARS OF FURTHER GROWTH

Upstream – Category Expansion

• Expansion into new sectors, such as:• Fabric mills

(synthetic woven fabric)

• Target route: JV or M&A

Manufacturing Expansion

• Domestic• JV with Mitsubishi

(ESGI) increasing capacity to another 21 million pcs with total 48 million pcs by end 2017.

• TPG (Teodore Pan Garmindo) expansion at West Java

• BIG (Berkah Indo Garment) at Central Java

• Regional• Expansion to other

countries to increase diversification and better reach the addressed markets.

• Target countries: Vietnam and other prospect countries.

Downstream – Channel Expansion

• Continuous expansion of brand, ZOE black, SnP, FTL, and Asylum.

• Joint venture with local and overseas partners for retail brands.

• Collaboration with global fashion brand.

• Planning to enter the e-commerce sector.

• Target route: JV or M&A

Product Optimalization

• Increasing capability in embroidery facility, printing facility, and laundry facility.


GARMENT MANUFACTURING


Marketing Office

Rep offices

Plants

Indonesia

Singapore

Hong KongTaiwan

Indonesia

Tangerang

Bandung

Boyolali

Sragen

CategoryTotal Machines

(Units)Manufacturing

Capacity (‘000pcs)

Mix catagories (Technical , Woven Garment and Cut & Sewn Knit)

26,626 90,000

Production and distribution spread across key Asian markets

Manufacturing Capabilities in years 2016

Strong manufacturing capabilities with production plants in Indonesia

Key production facilities

State of the art production facilities are situated across West Java and Central Java

Strategically positioned throughout Asia with offic es in Taiwan, Singapore and Hong Kong to serve customers in regio nal & global markets

Maintains close proximity to both customers’ region al offices in Hong Kong and Singapore as well as key fabric suppl iers in Taiwan

Vietnam

Ungaran

Demak

ACCREDITATIONS AND AWARD


ACCREDITATIONS

�ISO 9001:2008

�ISO 9001:2015

�ISO 14001

�WRAP

�GSV

�SA 8000

�OHSAS

�C-TPAT

SA 8000 ISO 9001:2008 ISO 14001:2004

Note: ISO 9001 : Quality Management System ISO 14001 : Environment Management System WRAP : Workplace Environment Management SystemGSV similar to CT-PAT : Global Security Verification ProgramSA 8000 : Social Accountability Management System OHSAS 18001 : Occupational Health & Safety Management System

ISO 9001:2008SNI ISO 9001 : 2008

ACCREDITATIONS AND AWARD


AWARDS

Indonesia Export Award 2016

Indonesia Best eMarkAward 2016

Best Listed Companies 2016 in Textile and Garment

Indonesia Living Legend

Companies 2016

Green Industry Award 2016

Product quality compliance and overall performance, 2016

Boyolali IndustrialAward 2016

Corporate University

Award 2016

Green Industry Award 2017

from Tangerang Government

TOP CSR 2017 on Garment and Textile Industry

Award APTI 2016

� Sending sewing trainers to Vocational Training Center

� Holding Science and Technology Olympics regularly (2015 -2016)

� Donating for a total 3000 scholarship to highly performed highschool students in Central Java (2014 - 2017)

� Scholarship package for 100 students in University of Indonesiafor bachelor degree (2017 - 2021)

� Organizing Employment programs on Synergy investmenttogether with Madrasah and PonPes

� Sponsoring medical trip to Papua presented by The HOPE

� Organizing health education such as cancer, HIV, etc

� Donating to natural disaster victims

� Coordinating blood donor regularly

16

CORPORATE SOCIAL RESPONSIBILITY



Sponsoring medical trip to Papuapresented by The HOPE

Coordinating blood donor regularly

Organizing Employmentprograms on Synergyinvestment together withMadrasah and PonPes

Sending sewing trainers toVocational Training Center

Donating to natural disastervictims

Holding Science and TechnologyOlympics regularly (2015-2016)

Donating for a total 3000 scholarshipto highly performed high schoolstudents in Central Java (2014 - 2017)

Scholarship package for 100students in University ofIndonesia for bachelor degree(2017 - 2021)

Organizing health education suchas cancer, HIV, etc

18

FINANCIAL OVERVIEW

GLOBAL PRESENCE – BY SALES


2013 2014 2015 2016 2Q17

30.46% 25.47% 28.29% 26.40%29.34%

30.43%

28.97% 19.88% 16.83% 13.46%

38.78%44.44%

50.79%55.70%

48.71%

0.33% 1.12% 1.05% 1.07% 8.49%

OTHERS

ASIA

EUROPE

USA

FINANCIAL HIGHLIGHT


SALES (US$m)

NET INCOME (US$m) / SALESEBITDA (US$m) / SALES

GROSS PROFIT (US$m) / SALES

(%) 12.3% 11.7% 12.8% 13.5%

(%) 3.1% 2.8% 2.1% 2.8%

10.4 9.3 8.6

13.3

4.5

2013 2014 2015 2016 2Q17

26.1 21.7

28.5

38.9

18.1

2013 2014 2015 2016 2Q17

41.8 39.6

53.6 65.3

32.6

2013 2014 2015 2016 2Q17

339.7 338.5 418.6

482.2

241.7

2013 2014 2015 2016 2Q17

13.5%

1.9%(%) 7.7% 6.4% 6.8% 8.1% 7.5%

FINANCIAL HIGHLIGHT


TOTAL DEBT & CASH (US$m)

OUTSTANDING SHARES (mn shares)TOTAL ASSETS (US$m)

DEBT / EQUITY (x)

3,084.90

6,478.30 6,478.30 6,478.30 6,478.30

2013 2014 2015 2016 2Q17

233.8

367.3 442.8

519.5 590.4

2013 2014 2015 2016 2Q17

0.8

0.5

0.7

0.9

1.1

2013 2014 2015 2016 2Q17

78.7 95.4

140.4

205.4

262.4

38.4

127.8

73.6 78.4 75.0

2013 2014 2015 2016 2Q17

Total Cash

Total Debt

22

APPENDIX

SUMMARY – Income Statement


(US$m) 2013 2014 2015 2016 2Q17

Net sales 339.7 338.5 418.6 482.2 241.7

% growth 118.5 99.6 123.6 115.2

COGS -297.9 -299 -365 -416.9 -209.0

% of sales -87.7 -88.3 -87.2 -86.4 -86.5

Gross profit 41.8 39.6 53.6 65.3 32.6

% margin 12.3 11.7 12.8 13.5 13.5

Selling expenses -5.5 -5.3 -8.5 -13.3 -6.4

% of sales -1.6 -1.6 -2.0 -2.7 -2.7.

G&A -17.5 -20.8 -28 -29.9 -14.8

% sales -5.2 -6.1 -6.7 -6.2 -6.1

Operating profit 18.8 13.4 17.1 22.0 11.4

% margin 5.5 3.9 4.1 4.5 4.7

% growth 134.5 74.0 127.5 112.2

Net interest expense -4.7 -0.9 -3..8 -6.3 -7.2

Other income (expenses) 0.3 1.5 -1.8 2.6 1.1

Profit before tax 12.7 12.9 11.5 18.3 5.3

Income tax expense -2.3 -3.6 -2.9 -4.9 -0.8

Profit for the year 10.4 9.3 8.6 13.3 4.5

% margin 3.1 2.7 2.0 2.8 1.9

% growth 150.7 96.7 92.4 154.1

Net Profit (Loss) attributable to equity holders

10.5 9.6 9.4 14.9 4.7

% margin 3.1 3.0 2.2 3.1 1.9

SUMMARY – Balance Sheet


(US$m) 2013* 2014* 2015 2016 2Q17

Cash and bank balances 38.4 127.8 73.6 78.3 75.0

Trade receivables 45.3 51.8 65.7 80.5 104.1

Inventories 55.6 67.4 88.6 101.6 142.4

Other current assets 30.9 37.2 82.6 126.2 135.2

Total current assets 170.2 284.2 310.6 386.6 456.6

Tangible assets 56.8 75.8 122.9 123.4 124.1

Intangible assets 3.4 3.2 3.1 4.9 5.0

Other 3.7 4.1 6.3 4.6 4.7

Total non-current assets 63.9 83.0 132.3 132.9 133.8

Total assets 234.1 367.3 442.8 519.5 590.4

Short-term borrowings 0.0 12.4 5.5 15.9 0.9

Trade payables 45.7 48.8 60.4 57.9 62.1

Other current liabilities 5.1 13.2 20.4 28.9 29.3

Total current liabilities 50.8 74.4 86.3 102.7 92.3

Long-term borrowings 78.5 82.9 134.9 182.2 64.0

Other long-term liabilities 6.6 8.5 5.7 6.9 203.5

Total non-current liabilities 85.1 91.4 140.6 189.1 267.5

Total liabilities 135.9 165.8 226.9 291.8 359.8

Shareholders' funds

Total shareholders' funds 95.7 186.2 197.0 210.7 214.5

Non-controlling interest 2.5 15.3 18.9 16.9 16.0

* As restated on PSAK No.24 (Revised 2013)

RETAIL

ZOE black side with STYLE over trends, thinkTIMELESS is never outdated. ZOE black don’tbelieve MINIMALISM as underdressed – ZOE black isconfident to let our personality shines and use ourclothes to enhance it. For us, the charm is in theMIX. The essence is EFFORTLESS CHIC.

ZOE black is an INDONESIAN BRAND, but ZOE blacksource our fabrics from around the world. Ourdesign, sourcing & production teams serve not usonly, but also well-known international brands.ZOE black take pride in our VALUE & QUALITY.



Salt n Pepper is a contemporary mencasual brand for upper middle class.

Inspired by designs and trends in theUSA and Europe, Salt n Pepper istailored to bring the latest trends in aperfect fitting for Asian sizes.

It’ s a catchy brand, unisex, globalmeaning and easy for people toremember

Just like how food is tasteless withoutsalt and pepper, we believe thatclothes need to have details added tomake it look great

Other brands are FTL and Asylum

RETAIL

GARMENT MAKING PROCESS


Warehouse Fabric Inspection Lab Test

Cutting

Embroidery/PrintNeedle DetectionInspection

Sewing

28

PT. Pan Brothers Tbk.Address : Jl. Siliwangi No. 178, Jatiuwung, Tangerang 15133, IndonesiaPhone : 6221-5900 718 Fax : 6221-5900 717Email : [email protected]/ [email protected] : www.panbrotherstbk.com



STRICLY PRIVATE AND CONFIDENTIALDISCLAIMERThis document is intended to be general information for discussion purposes only and does not create any legally binding obligations on the part of PBRX. The informationcontained in this document is based on materials we believe to be reliable, however we do not represent that it accurate, current, complete, or error free. Information inthis document constitute our judgment as of the period of preparing the document and are subject to change without notice. Any opinion in this information may notnecessarily represent the opinion of PBRX or any entity in the PBRX and Group. Any person and entity receiving this information shall treat the information as confidentialand not misuse, copy, disclose, or distribute, in whole or in part, without PBRX express written permission. PBRX disclaims all liability for any direct, indirect, consequentialor other losses or damages incurred by anyone that may arise from any reliance on this document or for the reliability, accuracy, completeness or timeliness thereof.

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