Sumitomo Forestry

Business in Indonesia

Sumitomo Forestry Co., Ltd. April.2017

1 CORPORATE PROFILE （As of March, 2017）

Net sales USD9,853M / Ordinary profit USD512M / Market capitalization USD2,653M (as of 31/Mar/2017)

Sumitomo Forestry Co., Ltd.

1691/ 1948

17,802 (Consolidated), 4,485 (Non-consolidated)

110 (Overseas 76)

Note: Net sales of each segment shown include inter-segment transactions.

※Exchange rate USD1＝JPY113

Company Name

Founded / Incorporated

Number of Employees

Affiliated Companies

Others USD204M

Overseas business USD2,194M

Housing business USD4,127M

Timber and building materials business

USD3,755M

History of Sumitomo Forestry Co. Ltd. 2

1881: Former smelting worksite

1691

Opening of the Besshi Copper Mine; permission granted by the Tokugawa

Shogunate for use of timber from nearby forests.

1903

Organization and start of the first private “Operation Plan (Forestry Plan)”

Establishment of “Sustainable Forestry” principle

1894

The Large-Scale Reforestation Plan was established. The Besshi

mountains, devastated by excessive timber harvesting and smoke

damage, were revived through large-scale reforestation.

国土報恩

2003: View of reforested smelting worksite

Teigo Iba

＜Corporate Philosophy＞

Sumitomo Spirit and Corporate Philosophy 3

＜Sumitomo Spirit＞

4 Important Objectives

・Promote traceability and environmental preservation. ・Promote forestry management that contributes to local communities’ economic development.

・ Utilize domestic lumber

・ Utilize energy saving technologies and build

“smart houses”.

・Promote reduction of carbon

footprints through utilization of biomass power generation,

etc.

Provide wood products and materials from sustainable forests

Promote global warming countermeasures through our business activities

Provide environmentally friendly homes

Promote employees’ family-oriented lifestyle

・Create a workplace that

allows each employee to realize his/her ideal

work- life balance.

We conduct business that is beneficial to society based on the principles of integrity and sound management.

The Sumitomo Forestry Group will utilize timber, which is an environmentally friendly natural material, to contribute to a prosperous society through all types of housing-related services.

Domestic

Overseas

Forestry & environment business

Overseas tree planting business

Domestic forestry business

1950～ 1691 1960～ 1970～

4 Business Fields

Upstream Midstream Downstream

Distribution of timber and building materials in Japan and overseas

Wooden building materials distribution business

Domestic manufacturing business

Overseas manufacturing business

Wooden building materials manufacturing business

Housing-related business

Custom-built home Construction & sales

business

Remodeling, leasing, other housing-related

business

Overseas housing

5 Overseas Network

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Distribution Base(14 companies), Plantation（4 companies）, Building materials manufacturing（13 companies）, Housing（26 companies）

Sumitomo Forestry has a vertically integrated business model:

China

Southeast Asia

Oceania

North America

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⑱

⑭⑮⑯

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⑳

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16 Countries, 57 bases (as of April 2017)

● Distribution Bases/Offices ：① Vancouver ② Khabarovsk ③ Kota Kinabalu (Malaysia) ④ Amsterdam ⑤ SF Dalian ⑥ SF Singapore ⑦ SF Indonesia

⑧ SF Australia ⑨ SF Vietnam ⑩ SF Thailand ⑪SF Indian ⑫ PAN ASIA PACKING ⑬Spacewood Furnishers Pvt ⑭ SF Singapore (Yangon)

●Forestry Business：① Open Bay Timber ② Mayangkara Tanaman Industri ③Wana Subur Lestari ④Tasman Pine Forests Limited

● Building materials Manufacturing Business ：① Kutai Timber Indonesia ② Kutai Timber Indonesia (Probolingo) ③ Kutai Timber Indonesia (Surabaya)

④ Kutai Timber Indonesia(Samarinda) ⑤ AST Indonesia ⑥ Rimba Partikel Indonesia ⑦ Rimba Partikel Indonesia(Jakarta) ⑧ Sinar Rimba Pasifik Indonesia

⑨ Nelson Pine Industries ⑩ Vina Eco Board ⑪ SFNZ ⑫ Canyon Creek ⑬ Mos Lumber Products

● Housing Business ：① SFC Homes ②MainVue Homes Group ③ Paragon Wood Product (Shanghai) ④ Paragon Wood Product (Dalian)

⑤ Dalian Sumirin Information Technology Service ⑥ Henley Arch ⑦ Henley U.S.A ⑧ 335 Grices Road Pty ⑨ Yantai Golden Bridge Enterprise ⑩ SF America

⑪ Edgewater Homes ⑫ Bloomfield Homes ⑬ Gehon Homes ⑭ SF Hong Kong ⑮ Partner Ally ⑯ Rainbow Alpha ⑰ SFA Land Developments

⑱ Creekstone Development ⑲ Beijing BBMG Decoration ⑳ Annadale ㉑ DNS AI ㉒ DRB Enterprises,LLC ㉓Phu Hung Thai ㉔ Wisdom Properties Group

㉕Justin Timberbrook ㉖DRSFA

New custom-built house in Japan

Remodeling and Renovation in Japan

6 Housing Business

Condominium in Japan Housing Business in US

Housing Business in Australia Smart House

- Solar Power System

- Home Energy Management System(HEMS)

- 12kWh large capacity lithium battery

7 Overseas Real Estate Development

Hong Kong

Land Area: 2,231sqm.

Condominium: 222 Units

(Condominium, Shopping Center, Day Care Center, etc.)

Construction Term: 2014 - 2017

Vietnam

Land Area: Approx.28,000sqm.

Condominium: Approx.2,100 Units

(Condominium, Shops, etc.)

Construction Term: 2017 - 2021

Australia

1.

Land Area: Approx.25,000sqm.

Condominium: 360 Units

(Condominium, Shops, Offices, etc.)

Construction Term: 2015 – 2018

2.

Land Area: Approx.5,300sqm.

Condominium: 164 Units

(Condominium, Shops, Offices, etc.)

Construction Term: 2016 – 2018

USA

Land Area: 39,659sqm.

Rental Apartment: 346 units

(Rental Apartment, Shops, etc.)

Construction Term: 2017 - 2019

8 Overseas Manufacturing Business

Vietnam

Indonesia

New Zeeland

USA

- Japan’s leading wooden building materials distribution company in terms of volumes handled

- Powerful worldwide procurement and distribution network

- Environmentally friendly and sustainable

9

PB MDF

Timber & Building Materials Business

SFC Group Procurement Policy

1. Traceable and sustainable procurement

2. Reliable supply chains

3. Effective use of wood resources and reduction of

environmental impact

4. Implementation of continuous improvement

with stakeholders

Plywood

10 Plantation Forest Operations

Hokkaido

18,199 ha

Kyushu 9,181 ha

Shikoku 14,783 ha

Honshu 4,280 ha

Plantations Natural

forest Other =500 ha

Company-owned forests in Japan

46,443 ha

Indonesia 160,000 ha

Papua New Guinea 31,000 ha

New Zealand 35,000 ha

=3,000 ha

Owned or managed overseas plantations

Approx. 230,000 ha As of March 31, 2017 As of June 30, 2017

11

Business in Indonesia

12 History in Indonesia

(1970) Plywood

manufacturing company

established in Indonesia

(1942) Starting the rubber plantation

management in Borneo Island

Borneo Island

13 Sustainable Forestry in Indonesia

●WSL/MTI

●ODA ●Project Earth Paliyan ● ●ODA

●ODA

WSL：PT. Wana Subur Lestari MTI：PT. Mayangkara Tanaman Indusutri Total Planation Area: 115,620ha (since 2010)

ODA: Official Development Assistance

After Recovery Before Recovery

14 Sustainable Forestry in Indonesia

Project Earth(since 2009) Plantation for Forest Recovery

in Bromo Tengger Semeru National Park

Manupeu Tanah Daru Laiwangi Wanggameti National Park

Bromo Tengger Semeru National Park

Gunung Ciremai National Park

ODA (Technical Cooperation Project)

2005(Before starting Project)

2013

Mitsui Sumitomo Insurance Tropical Rainforest Recovery Project in Paliyan, Gunungkidul Prefecture (2005-2020)

Kutai Timber Indonesia（KTI)

Established in Probolingo in 1970

Products: Plywood 130,000m3/yr,

PB120,000m3/yr,

Sawn Timber for Door parts and Building

Materials.

15 Manufacturing in Indonesia

Rimba Partikle Indonesia（RPI)

Established in Semarang in 1990

Product: PB 120,000m3/yr

Biomass Power Plant installed in 2008

Sinar Rimba Pasifik (SRP)

Established in Surabaya in 2009

Products: Stairs and floors using solid

hardwood

AST Indonesia（AST)

Established in Semarang in 1996

Products: Musical Instruments and building

materials incl, kitchen panels and housing

materials using RPI PB and NPIL MDF products

16 Interior Design Showroom in Jakarta

Address： Ruko Wisteria, Lantai 1, Jl. Panglima Polim Raya

No. 7A Kebayoran Baru,Jakarta Selatan 12160

17 Interior Design Showroom in Jakarta

Free distribution of seedlings

Scholarship Support

1