S

tate construction company PT Adhi Karya (ADHI) is targeting a 50 percent year-on-year revenue increase in 2014 and planning to diversify its business outside construction.

Such confidence was shown after the company successfully booked a near-double profit increase last year.

Adhi Karya corporate secretary M. Aprindy, in a statement posted on the Indonesian Stock Exchange (IDX) web portal, said that the company aimed to reap Rp 14.7 trillion (US$1.2 billion) in revenue this year, up by 50.6 percent compared to Rp 9.8 trillion in 2013.

Aprindy said that the company was looking to focus its business in other segments beside construction and loosen its dependence on the sector.

'€œThis year, we aim to distribute growth more evenly across our five business segments, so hopefully we will no longer only rely on construction projects but also be supported by our other business segments,'€ he said.

The publicly listed company operates five main business segments '€” construction; engineering, procurement and construction (EPC); property, realty and real estate.

Aprindy did not elaborate on the contribution each business segment gave to Adhi'€™s revenue last year, but construction business dominated its total revenues in 2012 with 84 percent, followed by EPC with 12 percent, property with 4 percent and real estate with 1 percent.

Adhi recorded a significant profit jump last year, up by 91.9 percent to Rp 405.9 billion compared to
Rp 211.6 billion in 2012.

Aprindy said that of the total profits booked last year, its property subsidiary Adhi Persada Properti (APP) contributed Rp 117.9 billion or 29.04 percent and its realty wing Adhi Persada Realti (APR) contributed Rp 75.4 billion or 18.58 percent, indicating that it had started to successfully diversify its business.

As for this year, construction still dominated Adhi'€™s total new contracts of Rp 21.1 trillion with 54 percent or Rp 11.9 trillion of the total figure.

Its EPC wing is expected to contribute 12.2 percent or Rp 2.7 trillion of the new contracts.

Adhi'€™s property business makes 6.2 percent of the contracts with Rp 1.3 trillion, while its realty
subsidiary contributes 3.5 percent or Rp 777.7 billion.

Aprindy said that the company hoped APR and APP would contribute 50.2 percent to Adhi'€™s profits this year, saying that APP is projected to generate Rp 169.5 billion in net income while APR is expected to earn Rp 116.6 billion.

Adhi has also established a new subsidiary, Adhi Persada Gedung, which is expected to attract more private consumers interested in building skyscrapers. The new subsidiary is projected to net Rp 1.4 trillion of revenue and Rp 76.6 billion of profits.

To support its target this year, Adhi is planning to disburse Rp 879 billion of capital expenditure (capex), which is 17.67 percent up compared to Rp 747 billion in 2013. Aprindy said that the capex would be allocated to finance its hotel businesses, property and realty wings, and its infrastructure and transportation projects.

Among Adhi'€™s ongoing and finished projects are Cimone City Mall in Tangerang, Banten; Mandau City Mall in Riau; Taman Dhika housing complex in Sidoarjo, East Java; Salemba Residences Apartment in Central Jakarta; Jatinangor Apartment in Bandung, West Java; and Grand Dhika Apartment in Bekasi, West Java.