Bayan targets gross profit to rise by 86.2 percent

Ika Krismantari ,  The Jakarta Post ,  Jakarta   |  Thu, 06/25/2009 8:45 PM  |  Business

Local coal producer publicly listed PT Bayan Resources is targeting this year's gross profit to rise by 86.2 percent on the back of higher sales volume and lower production costs.

Bayan director for corporate affairs and corporate secretary Jenny Quantero said on Thursday that gross profit would reach Rp 1.75 trillion (US$171.5 million) this year from Rp 939.5 billion.

"This is mostly because of an increase in production volume and a drop in production costs," she said.

She said the company had signed contracts to deliver 10 million tons of coal for clients in Korea, Japan, Taiwan, Malaysia and India this year as opposed to only 5.9 million tons sold last year. Therefore, the company's revenue would increase by 32.6 percent to Rp 6.5 trillion this year.

She added the drop in production costs, estimated to reach between $50 and $55 a ton this year, lower than $71 in the fourth quarter last year on the back of lower oil prices, would contribute to the rise in revenue

Bayan president director Chin Wai Fong said the company would start producing briquettes from its new upgraded coal plant at a rate of 300,000 tons this year.

"The volume has been included in the sales volume target for this year," Fong said.

He said that the new plant would be the first one in Indonesia, explaining that the technology would enable the company to process low-grade coal to make it more valuable. The $68-million plant would start operations in the third quarter of this year.

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