T

he increase in fuel costs and the sharp depreciation of the rupiah against the US dollar have severely hurt state-owned electricity company PLN'€™s 2013 balance sheet, which saw earnings swing deeper into negative territory.

PLN said on Wednesday that the company had booked Rp 29.56 trillion (US$2.5 billion) in net losses last year, a massive setback compared to Rp 3.2 trillion in net profits in 2012. It reported a higher revenue last year, but the increase was too small to offset rising operating expenses due to the increase in fuel costs and fall in the rupiah.

According to its financial report, the company'€™s total revenue stood at Rp 257.4 trillion last year, 10 percent higher compared to Rp 232.6 trillion a year earlier. Out of the total amount, as much as Rp 153.48 trillion was obtained from electricity sales, a 21 percent surge compared to Rp 126.72 trillion in 2012.

PLN also received Rp 101.2 trillion in subsidies from the government last year.

It said that increases in revenue, particularly income from the sales of electricity, were driven by the increase in tariff imposed last year and the higher volume delivered.

'€˜The increase of sales volume was spurred by economic growth, which also resulted in the addition of 3.8 million new customers. As of the end of 2013, the company'€™s total customers reached 54 million,'€ PLN said in a written statement.

PLN will likely enjoy further revenue growth this year as the government is planning to impose increases in the electricity tariff for big users starting May 1.

The company'€™s increasing operational performance was tainted by surging expenses. Spending for fuel and lubricants reached a total of Rp 147.63 trillion in 2013, which was a 8 percent increase from a year earlier.

Although the company has increased the use of other energy sources, such as gas, to feed its power plants, it still has numerous power pants fueled by diesel oil.

PLN oil-based fuel and gas division head Suryadi Mardjoeki said the company aimed to reduce the use of diesel-fuel by 1 million kiloliters and replace it with other energy sources, such as biodiesel and gas.

Suryadi targets to save Rp 10 trillion from the reduction in diesel use.

The company also suffered Rp 48 trillion in foreign exchange (forex)losses last year, particularly due to a 20 percent fall in the rupiah exchange rate against the US dollar and 3.6 percent against the Japanese yen, its financial report showed.

'€œThe weakening rupiah caused PLN'€™s loan value and lease liabilities for transactions with the Independent Power Producer [IPP], which is dominated by foreign exchange loans, to increase significantly,'€ the company said.

PLN'€™s total assets were worth Rp 595 trillion as of the end of December 2013. Its equity was Rp 133 trillion and liabilities at Rp 462 trillion.