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United Tractors ramps up capex, continues diversification to non-coal sectors
United Tractors plans to use $1 billion of its capex budget for the mining and coal mining contractor sector.
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Industry Minister Airlangga Hartarto visits the United Tractors booth at the Gaikindo Indonesia International Commercial Vehicle Expo (GIICOMVEC) 2018 on March 1 after officiating the event, at JCC Senayan in Jakarta. (tribunnews.com/File)
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ublicly listed heavy equipment distributor PT United Tractors has increased its capital expenditures (capex) by 16.6 percent year-on-year (yoy) to around US$1.4 billion this year, as the firm makes its push to diversify its business, which is currently dominated by coal mining.
The company, a subsidiary of conglomerate PT Astra International, plans to use $1 billion of its capex budget for the mining and coal mining contractor sector.
It allotted the rest for washing plants and ports, gold mining infrastructure and construction machinery, among many others.
“Our priority is to meet our capex needs for business as usual using internal cash flow,” said United Tractors director Iwan Hadiantoro at a press conference on Wednesday.
“Currently, our cash reserves are sufficient to fund our target,” he added, detailing that the fund was deemed enough for dividends, merger and acquisition plans as well as corporate actions for the rest of the year.
Read also: Heavy equipment sales take a dive as commodity prices plunge
While United Tractors plans to self-finance its core business operations, it will seek partnerships with third parties for new investments, Iwan said, particularly in the mineral mining sector.
