Antam's 9-month net soars by 260%

State nickel miner PT Antam Tbk announced Friday unaudited consolidated net profit of Rp 521 billion (US$= Rp.9,200)and earnings per share (EPS) of Rp 272.96 for the first nine months of 2004. The 260% increase over the same period last year, is attributed to higher commodity prices.

Antam?s cost of sales rose 7.5% largely due to increased fuel costs, rise in ore exploitation cost following higher sales volume, as well as higher employee bonus. Operating expenses increased 16.6% following increased exploration and mine closure costs. Higher prices widened Antam?s operating margin to 36% from 20% last year.

Largely attributed to exports of nickel, Antam?s consolidated revenue for the nine months to September 30, 2004 rose by 36% to Rp 1,941 billion. Due to higher prices Antam?s nickel division accounted for 75% of revenues, at Rp1,456 billion, with gold contributing Rp 359 billion, or 18% of total revenues.

The major reason for increased revenues is due to the higher average selling prices of all of Antam?s products. The average price Antam charged for its nickel contained in ferronickel rose 66% over the first nine months of 2003 from US $3.72 per pound to US $6.19 per pound, while the weighted average selling price for gold increased by 15%, from 353.75/oz to 405.32/oz.

In 9M04, sales of contained nickel in ferronickel, nickel ores, and gold reached 5,394-ton ni, 2,738,686 wmt and 2,754 kg respectively.

In 2005, Antam expects costs will be lower as the full overhaul of FeNi II will be completed, along with the construction of 3 new power generators, which will normalize production and stabilize power output. The economics of scale following the completion of the FeNi III smelter will also help to lower Antam?s costs further. Another potential source of saving will come from the possibility in using cheaper power, such as gas, for Antam?s new power plants. (Alex)