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Change in business strategy boosts Elnusa profits
Publicly listed oil and gas firm PT Elnusa reported a significant increase in its profits in the first quarter of this year, partly due to the companyâs policy to prioritize projects with higher margins
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ublicly listed oil and gas firm PT Elnusa reported a significant increase in its profits in the first quarter of this year, partly due to the company's policy to prioritize projects with higher margins.
Nurkolis, Elnusa's vice president for corporate finance, said that the company had recorded net profits of Rp 117.8 billion (US$10.37 million) as of September, a 48 percent increase from the Rp 79.5 billion gained in the same period last year.
With this figure, the company has almost fulfilled its net profit target of Rp 138 billion this year, which represents a 10 percent increase from Rp 127 billion last year.
'Our net profits up to the third quarter of this year amounted to around 85 percent of our annual target. We are optimistic we can achieve it,' Nurkholis said in a statement.
'We have implemented a business policy that gives priority to projects and services offering high margins,' he explained.
During the third quarter, Elnusa also booked a 14 percent profit margin, up from the 11 percent recorded last year. The firm's net profit margin also rose to 4 percent from 2 percent.
With improved cash flow, the company was able to pay its US dollar debt obligation during the third quarter. The payment resulted in a fall in its outstanding loans to $68 million as of September, down from $124 million in the same month last year.
Elnusa, as previously reported, expects to secure new contracts worth Rp 2.8 trillion ($288 million) this year to conduct seismic, drilling and oil field services in the country's oil and gas sector.
The new contracts are expected to boost the company's revenue to Rp 5.3 trillion this year, which will be an increase of about 10 percent from the Rp 4.8 trillion in revenue last year.
Elnusa recently expressed an interest in entering other energy-related services to secure more sustainable income. The company's contracts usually comprise short-term agreements.
It is seeking new business opportunities, including marine support services and logistics, operations and maintenance and independent power plants..
According to Indonesia Stock Exchange (IDX) data, Elnusa is 41.1 percent owned by PT Pertamina; 24.6 percent owned by Jakarta-listed PT Benakat Petroleum Energy; 5.25 percent owned by BSI Bank Limited, with the remaining shares under public ownership.
