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ublicly listed oil and gas company PT Medco Energi Internasional is reporting a sharp decline in net profits for 2012 despite double-digit growth in total revenues.

Medco reported US$909.05 million in revenues in 2012, up 11.2 percent from $817.72 million a year earlier, while gross profits were up almost 13 percent to $396.23 million, compared to $350.88 million in 2011.

The company also reported $341.5 million in earnings before interest, tax, depreciation and amortization (EBITDA) last year, beating its own estimate of $337 million.

However, net profits slumped 79.6 percent to $17.92 million in 2012, down from $87.78 million.

In April 2011, Medco’s stake in PT Donggi Senoro LNG (DSNLG) was diluted to 11.1 percent from 20 percent when the company declined to purchase new shares issued by DSLNG.

According to Indonesian accounting standards, Medco booked $8.47 million in gains from “the dilution of the company’s ownership”.

However, the account was no longer recorded on the firm’s financial report for 2012 after the company ceased to use equity-based accounting methods.

Medco also recorded higher costs of selling and general and administration expenses, which were up 12 percent to $143.04 million, and an increased financing burden of $95.93 million, up 23 percent from 2011, due to repayments of bank loans and bonds.

The firm’s tax burden rose 29 percent to $156.34 million last year from $120.77 million in 2011, which was attributed to deferred tax assets.

“Given the company’s strong operational performance last year and progress on its main development projects, we are optimistic about the company’s performance in the future,” Medco president director Lukman Mahfoedz said.

“We are expecting to maintain oil and gas production at the same level until our main projects, which are the Senoro Upstream and the DNSLNG, come into operation by the end of 2014,” Lukaman said, referring to the Donggi-Senoro liquefied natural gas refinery.

Medco’s oil and gas production reached 68,000 barrels of oil equivalent per day (BOEPD) in 2012, with a sales volume of 14.7 million barrels of oil (MMBO) priced at $115.6 per barrel.

Meanwhile, the firm’s gas sales volume reached 56.3 trillion British thermal units (TBTU) priced at $4.03 per million British thermal units (MMBTU) last year.

Lukman previously said that Medco would book around $360 million in EBITDA this year, which would be an increase of around 5 percent.

Medco also said that it cooperated with strategic partners last year to boost the company’s non oil and gas business, divesting a 51 percent stake in PT Medco Power Indonesia to Saratoga Power and 63.88 percent stake in PT Medco Sarana Kalibaru to Puma Energy.

After the divestments, Medco no longer consolidates the two companies on its financial statement.

“Our focus will remain on exploration and production. Partnerships with Saratoga in Medco Power and with Puma Energy are progressing well. We continue [to look for] opportunity for partnership in the downstream business such us ethanol,” Lukman said.

Shares in Medco (MEDC) closed at Rp 1,610 (17 US cents) apiece on Wednesday, down 1.83 percent from Tuesday.