WIKA secures H1 target, pushes for more

One of Indonesia’s largest construction companies, PT Wijaya Karya (WIKA), expects to end the first half of the year on a high note after recording Rp 7.5 trillion (US$795 million) worth of new contracts.

Corporate secretary Natal Argawan said the company was likely to reap Rp 500 billion in new contracts before the end of the month, boosting the company’s performance well above its Rp 7 trillion target for the first six months.

“We are in the bidding process in several projects, the results of which are scheduled to be published this week,” WIKA corporate secretary Natal Argawan said on Thursday.

WIKA announced on Thursday that it had just obtained a contract to construct seven bridges to support the double track railway connecting Semarang in Central Java to Bojonegoro in East Java. The bridge construction contracts are worth Rp 122.8 billion.

WIKA previously also won a tender to construct 8-kilometers of the double track railway for Rp 191.2 billion. The work started in March and will be completed within 19 months.

As of Thursday, the total value of contracts signed by the company stood at Rp 7.5 billion, Natal said.

The double track Semarang-Bojonegoro railway is part of the planned double track route connecting Jakarta to Surabaya. The double track is expected to improve the country’s railway system, some parts of which still use a single track. The Transportation Ministry recently said that about 390-kilometers of the double track railway was completed out of a total of 727-kilometers connecting Jakarta–Surabaya.

The double track railway is also expected to service the transport of goods in Java, which currently relies heavily on the island’s north coast highway, which is famous for its abbreviated name, the Pantura.

Besides the double track projects, WIKA also secured the project of port expansion of Dermaga Utara Batu Ampar in Batam, Riau. The port development project is worth Rp 349.9 billion.

WIKA will work on the civil construction of the port expansion, including construction of a new port intended to be 600-meters in length, dredging, procurement, the installation of a crane rail, the improvement of the existing port, lighting installations as well as working on hydrants and a clean water installation.

WIKA will work on the port expansion from this June to December 2014.

“We are the main contractor. However, we will deliver some specific work to other companies, probably local companies, because we have limited resources,” Natal said.

After the improvement, the port will have a loading capacity of 800,000 20-foot equivalent units (TEUs) from its current level of 200,000.

WIKA is targeting to book Rp 16.5 trillion in new contracts by the year end, up 35 percent from last year’s Rp 12.2 trillion.

The total new contracts will see the company work on projects worth Rp 32.09 trillion this year, of which Rp 15.57 trillion projects are carry over works from last year.

Shares in WIKA were unchanged at Rp 1,010 on Thursday. The company’s market capitalization reached Rp 6.13 trillion.

WIKA is aiming to book revenue of Rp 9.17 trillion from its sales and Rp 2.99 trillion from sales of joint operation projects by the end of 2012. The company is projecting that its net profits will stand at Rp 430 billion this year.