Harum Energy?s output drops 42%

By Romel S. Gurky

IDX-listed coal mining firm PT Harum Energy Tbk announced on Monday that its combined production fell 42.2 percent to 1.3 million tons in the first half of the year from 2.3 million tons in the same period of last year.

Price dropped by 12.4 percent to $47.4 per ton from $54.1 per ton.

Malaysia is the largest market for the firm?s coal, followed by South Korea and Taiwan. Sales to China had been on the decline over the past two years due to the decrease in imports by Chinese buyers.

Production costs of FOB vessel cash cost fell by 24.7 percent to $30.2 per ton in the first half of the year, from $40.1 per ton in the corresponding period of last year. Stripping ratio fell to 5.7x to 7.3x, while average fuel costs dropped 38 percent year on year. Administrative and general expenses also fell.

FOB Vessel Cash Cost fell to US$ 28.1 per ton in the second quarter of 2016 from $ 32 per ton in the first quarter of 2016, particularly due to the decrease in the volume of coal purchasing for blending purpose. Sales volume dropped by 40.3 percent, while average sales price fell by 12.4 percent.

EBITDA in the first semester of 2016 reached $12.7 million, up by 9.6 percent from $11.6 million in the same period of last year as costs declined at a faster rate than revenues.

Net profit in the first semester of the year reached $4.4 million, representing a 55.9 percent increase from $2.2 million in the first half of 2015, thanks to efficiency in operating costs.

Budget allocated for 2016 is $6.5 million. Of the budget allocation, $4 million has been spent in the first half of the year mostly for drilling and exploration activities and pre-operation of PT Karya Usaha Pertiwi and PT Tambang Batubara Harum and land compensation for PT Mahakam Sumber Jaya, maintenance costs of barge and tugboat and purchasing of vehicles.

Harum is a holding company, with business portfolio engaged in coal mining and logistics activities in East Kalimantan

Editing by Johannes Simbolon