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Jakarta Post

Weak demand, govt incentives drive PGN profit down 88%

  • Norman Harsono

    Jakarta

Jakarta   /   Thu, September 10 2020   /  01:00 am
A PGN technician inspects a household gas pipe meter beside the homeowner at her residence in Pasuruan, East Java, on 17 October 2019.(JP/Norman Harsono)

Gas distributor PT Perusahaan Gas Negara (PGN) saw its net profit fall 87.6 percent year-on-year (yoy) to US$6.72 million in the first half of the year as a result of weak energy demand and government gas incentives. The publicly listed company’s revenue fell by 17.9 percent yoy to $1.47 billion in the January-June period, dropping more sharply than its expenses, which declined by 16.7 percent yoy to $1.01 billion following operational cuts. Read also: PGN seeks to cut 2020 capex by up to 60 percent PGN finance director Arie Nobelta Kaban said the company was affected by a “triple-down effect” of weak global gas prices, low domestic gas demand and a disadvantageous rupiah exchange rate during the COVID-19 crisis. “Low oil and gas prices lowered upstream revenue, while operational costs did not follow suit,” said Arie in a statement. PGN shares...