Antam sees 9% increase of unaudited income

By Ruli Setiawan

Indonesia listed coal miner PT Antam has announced through its quarterly report that its unaudited income for the first three months of 2012 has increased about 9 percent over the same period of 2011 to Rp 379 billion, attributable to owners of the parent with Earnings per Share (EPS) of Rp39.82.

The company stated that the increase was attributed from higher ferronickel, nickel ore and gold sales.

"Our first quarter results remained solid in the midst of weaker nickel prices. The strong demand for nickel and gold continued to support our performance. The modernization of FeNi II smelter which began in the beginning of the first quarter of 2012, was successfully completed at the beginning of April 2012," said Antam's President Director Alwinsyah Lubis, adding that the company aims at improving the efficiency of the smelter following this program.

"We believe our operational and financial results will remain strong in 2012," he said.

Antam's overall net sales increased 24 percent to Rp2.5 trillion compared to Rp2 trillion in the first quarter of 2011.

Gold was the largest contributor to Antam's total net sales with Rp91 billion contribution or 37 percent of total net sales. Ferronickel was the second largest contributor with 31 percent contribution or equal to Rp774 billion.

Sales of ferronickel almost doubled at 99 percent to 4,402 ton nickel contained in ferronickel. Inline with higher sales volume, ferronickel revenue increased by 44 percent to Rp774 billion despite a 29 percent lower price to US$8.72 per lb.

Ferronickel production was 25 percent lower over first quarter of 2011 to 3,631 TNi as Antam conducted an optimization program for FeNi II smelter, which began at the end of January. Antam expects maximum capacity of the smelter in May 2012.

Inline with continued strong demand, sales volume of nickel ore rose by 9 percent to 1,769,649 wmt. Despite a stronger sales, nickel ore revenue only slightly increased by 1 percent to Rp663 billion inline with lower sales prices. Antam's nickel ore production reached 2,118,473 wmt, a 5 percent higher over the same period of 2011.

The company's gold sales for the first three month of 2012 increased by 3 percent to 1,783 kg due to continued strong demand. Gold production was 3 percent lower at 570 kg. Higher sales volume coupled with a 24 percent increased gold price to US$1,745.72 per toz generated Rp911 billion, a 31 percent higher over first quarter of 2011.

Antam's cost of sales, on the other hand, increased by 40 percent to Rp l.9 trillion due to higher work in process at the end of the period, which increased to Rpl50 billion.

As the increase of the cost of sales exceeded sales, Antam's gross profit was lowered by 11 percent to Rp557 billion. Higher operating expenses of 31 percent to Rp204 billion made Antam's operating profit lowered by 25 percent to Rp353 billion.

In the first quarter of 2012 Antam posted Other Income-Net of Rp135 billion, inline with Rp123 billion dividend income from its joint venture, PT Nusa Halmahera Minerals and a Rp71 billion interest income.

The company's cash and cash equivalents amounted to Rp5.9 trillion with interest bearing debt in the form of bonds issued at Rp3 trillion.

Antam's net cash provided by operating activities was Rp455 billion, an increase of 41 percent over 2011. The increase was largely due to higher cash receipts from customers and cash receipts from interest income. Antam's cash and cash equivalents at the end of the period amounted to Rp5.9 trillion.

Editing by Audy Zandri