Astra International failed to stave off unfavorable domestic macroeconomic conditions, as the diversified conglomerate posted flat growth last year, dragged down by declining business in its subsidiaries.

According to a press release made available on Thursday, the publicly listed giant recorded a flat 4 percent year-on-year growth in consolidated revenue to Rp 193.9 trillion (US$16.6 billion) in 2013. Its consolidated profits remained unchanged from the previous year, standing at Rp 19.4 trillion.

In comparison, Astra booked 16 percent and 9 percent year-on-year increases in its consolidated revenue and net income respectively in 2012.

Astra president director Prijono Sugiarto said that the conglomerate was actually satisfied with the performance, considering the grim economic climate of the second half of 2013.

'€œDespite some of our divisions facing challenges last year, Astra still posted an outstanding performance in 2013,'€ Prijono said in the statement.

'€œBusiness prospects in 2014 are projected to stay promising, although heavy competition in car sales will sustain and coal prices are still weak. Meanwhile, we still have to keep our eyes on loan rates increasing and currency volatility.'€

Astra currently runs six business segments: automotive, financial services, heavy equipment and mining, palm oil, toll road and document solution.

Out of six, two major divisions '€” heavy equipment and mining and palm oil plantations '€” saw decreasing profits and revenue in 2013. Its automotive segment '€” which is the backbone of Astra'€™s business '€” saw muted growth.

Astra automotive division posted a 4 percent year-on-year increase in profits to Rp 9.8 trillion, which makes up 50.5 percent of the holding company'€™s total profits.

The company'€™s annual motorcycle sales surged by 15 percent to 4.7 million units in 2013, boosting its market share from 58 percent in 2012 to 61 percent last year.

However, Astra'€™s car sales rose by only 8 percent to 655,500 units, below the national car sales growth of 10 percent. Its market share dropped by a percentage point to 53 percent last year.

'€œDemand for vehicles is still high but the competition is getting tighter. That condition plus an increasing labor wage affected profits contributed from our car division,'€ the statement said.

Astra'€™s automotive component manufacturer, Astra Otoparts, recorded a 29 percent year-on-year increase in revenue to Rp 10.7 trillion last year, compared to Rp 8.23 trillion in the previous year.

Its profits, however, declined by 4 percent to Rp 1.06 trillion in 2013 compared to Rp 1.13 trillion in the previous year '€” suffering from surging prices of raw materials due to currency depreciation and increasing labor wages.

Its heavy equipment and mining division suffered most, experiencing an annualized profit drop of 15 percent to Rp 3 trillion.

United Tractors (UT) reported a 16 percent year-on year decline in profits to Rp 4.8 trillion, mainly attributed to sales of heavy equipment falling by 32 percent to 4,200 units. The plunging sales were mainly due to declining demand from the mining industry, with coal prices still low.

UT'€™s mining division also posted a 34 percent decline in revenue last year.

Nevertheless, Astra'€™s finance, logistics and distribution, and IT division managed to book significant growths last year, helping Astra cushion the falls in the other sectors.

Astra'€™s financial division recorded a 5 percent year-on-year increase to Rp 4.3 trillion in 2013, supported by the growth of Bank Permata and autofinance units Astra Credit Companies, Toyota Astra Financial Services and Federal International Finance.

Astra'€™s automotive financing units channeled Rp 57 trillion in loans last year, an increase of 13 percent year-on-year.

Bank Pemata, meanwhile, saw its profits rise by 26 percent to Rp 1.7 trillion last year compared to 2012.

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