Bukit Asam posts modest growth in Q1

JAKARTA. After seeing a steep decline in its bottom line last year, state-run coal miner Bukit Asam managed to book modest growth in sales and profits in the first quarter of this year, thanks to the company’s increasing coal prices.

Bukit Asam’s corporate secretary, Joko Pramono, said in a written statement published on Monday that the publicly listed miner had begun to post rising profits by about 9 percent year-on-year (y-o-y), and recorded stronger revenue growth by around 11 percent y-o-y in the first three months of 2014, despite a slight drop in its coal sales.

Bukit Asam posted Rp 536 billion (US$46 million) in net profits between January and March, while it earned Rp 493 billion in the same period last year.

The company’s revenue during the first three months amounted to Rp 3.09 trillion compared to Rp 2.77 trillion in 2013.

The company’s coal production rose by 13 percent to 3.29 million tons during the period, compared to 2.92 million tons produced in the same period last year.

Despite the higher production, the company’s first-quarter sales volume dropped slightly to 4.2 million tons from 4.5 million tons in 2013.

The company attributed the declining coal sales to slowing sales among some of its subsidiaries.

Nevertheless, Joko said the company’s increasing sales prices had helped Bukit Asam to push up its revenue despite the decrease in sales volume.

“The increase in revenue is a result of our strategy to sell seven brands of coal. This strategy successfully increased the average selling price of coal during the period between January and March in the range of Rp 733,396 per ton, up 19 percent from Rp 613,810 per ton in the same period last year,” he said.

Due to a steep decline in commodity prices last year, Bukit Asam saw its profits slump by 38 percent y-o-y to Rp 1.85 trillion. Revenue remained stagnant at Rp 11.2 trillion last year, compared to Rp 11.6 trillion in 2012.

The company produced and sold more coal in 2013 than in 2012.

Its coal output last year hit 15.1 million tons, up by 8 percent compared to the previous year. Bukit Asam’s sales volume rose by 16 percent to 17.76 million tons last year, compared to 15.33 million tons in 2012.

As for 2014, Bukit Asam aims at boost its sales by 39 percent y-o-y to 24.7 million tons.

To further buffer a potential drop in coal prices, the company aims to boost its exports by 41 percent to 13.53 million tons, compared to last year.

Moreover, Bukit Asam hopes to see production reach 19.8 million tons, an increase of 31 percent compared to last year. Its third-party purchases is expected to increase by 46 percent year-on-year to 3.98 million tons.

This year, the company has launched the full operation of its 3 by 20 megawatt (MW) Tanjung Enim plant in South Sumatra and a 2 by 8 MW Tarahan plant in Lampung to reduce production costs and its dependence on state electricity company PT PLN.

Bukit Asam plans to disburse Rp 1.54 trillion capital expenditure this year, of which approximately 75 percent will be allocated to the company’s project development, while the remainder will be set aside for routine maintenance.

The company is currently working on several projects, which include the expansion of its ports and railways at its mining sites in South Sumatra, several power plant projects and a coal bed methane (CBM) project, which is expected to start producing 40 million cubic feet per day by 2015. (Anggi M. Lubis)