Timah targets 15% profit growth under new leadership
The newly-appointed president director of state-owned tin producer PT Timah Tbk, Sukrisno, has set a target of up to a 15 percent increase in net profits this year on bigger production volume.
Hitting such a target is expected to drive Timah to book up to Rp 1 trillion (US$109 million) in net profits by year end, as the company reported Rp 896.78 billion in net profits last year.
“Our growth will be supported by growing production volume to between 40,000 and 45,000 metric tons of refined tin this year,” Sukrisno, who previously served as president director of PT Tambang Batu Bara Bukit Asam. Last year the company produced 38,132 metric tons.
Increasing tin prices, according to Sukrisno, would also contribute to the company’s bottom line. The company weathered volatile market prices for tin last year, which swung from $18.610 to $33,255 per metric ton as a consequence of financial crisis in Europe and the United States. The price volatility led to lower shipments as Indonesian producers, including Timah, halted exports in an attempt to stabilize tin prices.
Timah is allocating up to Rp 1.4 trillion in capital expenditures this year, partly to finance the procurement of bucket wheel dredgers and upgrades for its existing processing and smelting facilities.
Moreover, Timah also wants to acquire an additional five cutter-suction dredgers.
Timah recently obtained standby loans amounting Rp 3 trillion from local and foreign banks. “The funds will be used to improve our business, such as capital expenditures, and productive investment,” Timah director Abrun Abubakar said.
The company is also planning to use the loans to finance the acquisition of a coal mining concession.
Abrun said that Timah expected to acquire at least one coal mining concession this year.
“There are four concessions we are looking at. We hope to acquire one of them,” he said.
Currently, Timah has a coal mining area in South Kalimantan, which has a production capacity of 600,000 metric tons per year.
Sukrisno, who was appointed as president director in a shareholders meeting on Thursday to replace Wachid Usman, said that coal mining was part of his company’s business expansion.
“We are still a minority in the coal mining business, at about 8 to 9 percent of ownership. We haven’t decided to go into the coal mining business or other sectors. It is just a business calculation, as coal mining is booming,” Sukrisno said.
In a shareholders’ meeting on Thursday, Timah announced that it would disburse Rp 448.39 billion in dividends, or 50 percent of its Rp 896.78 billion in net profits from 2011. The dividend pay-out ratio is equal to Rp 89.09 per share.
“The dividends will be paid at the end of May,” Abrun said.
Shares in Timah closed at Rp 1,820 a piece on Thursday, increasing by 4 percent from Rp 1,750 a piece a day earlier. (yps)
Previous board of directors New board of directors
Wachid Usman (president director) Sukrisno (president director)
Setyo Sardjono (director) Dadang Mulyadi
Surawardi (director) Purwijayanto
Krishna Syarif (director) Ahmad Rosidi
Gatut Hari Prasetyo (director) Abrun Abubakar
Previous board of commissioners New board of commissioners
Insmerda Lebang (president commissioner) Insmerda Lebang (president commissioner)
Bingrosalto L Tobing Bingrosalto L Tobing
(independent commissioner) (independent commissioner)
Fachry Ali (independent commissioner) M Lobo Balia (commissioner)
Boni Siahaan (commissioner) Suhendro (commissioner)
Lobo Balia (commissioner) Suryadi Saman (independent commissioner)
Suhendro (commissioner) Erfi Triassunu (commissioner)
—JP/ Raras Cahyafitri