Net Profit of Indo Tambangraya (ITMG) Plummets by 58% in 2023

CORPORATE STRATEGIC – JAKARTA. The performance of PT Indo Tambangraya Megah Tbk (ITMG) shrank throughout 2023. The net profit of this coal mining issuer plummeted 58.30% to US$ 500.33 million by the end of 2023.

Thus, ITMG's net profit per share also fell to US$ 0.44 from previously US$ 1.07 per share.

For comparison, ITMG's current year profit attributed to the parent entity's owners in 2022 reached US$ 1.2 billion.

The decrease in net profit is in line with the decrease in revenue. ITMG pocketed revenue of US$ 2.37 billion in 2023. This revenue fell 35% compared to the revenue in 2022 which reached US$ 3.63 billion.

ITMG management mentioned, one of the causes of the decrease in revenue is the decrease in the average selling price (ASP). The realization of ITMG's average coal selling price last year fell by 41%, from US$ 192 per ton in 2022 to US$ 113 per ton in 2023.

Read Also: Growing 35%, Hasnur International Shipping Gets a Profit of Rp 157 Billion in 2023

However, the decrease in ASP was offset by an increase in coal sales volume by 11% to 20.9 million tons. This increase in sales was supported by a 1% increase in production to 16.9 million tons.

On the other hand, ITMG managed to suppress a number of costs last year. ITMG's cost of revenue fell 6% to US$ 1.63 billion from previously US$ 1.74 billion.

“The decrease in cost of revenue was influenced by the decrease in royalties due to the decrease in coal selling prices and the decrease in benchmark coal prices,” said ITMG management, Thursday (22/2).

Then, sales expenses were suppressed by 44% to only US$ 95 million from previously US$ 170 million. ITMG also managed to cut operating expenses by 35% to US$ 137 million from previously US$ 212 million.

This decrease was mainly caused by the decrease in ASP which eventually reduced the Company's sales expenses. In addition, there was a reversal in the domestic market obligation (DMO) expenses that had been recorded on an accrual basis for performance in 2022 based on the Decision of the Minister of Energy and Mineral Resources No. 399.K/MB.01/MEM.B/2023

The decrease in ASP also impacted the decrease in royalty payments to the government which fell by 35% year-on-year (YoY) to US$ 332 million from previously US$ 514 million in 2022.