Manhattan gears up for power business

By Romel S. Gurky

SGX-listed Manhattan Resources Limited (MRL or together with its subsidiaries, the Group) has successfully consolidated the business of PT Kariangau Power (PT KP) after receiving shareholders? approval at an Extraordinary General Meeting.

With the consolidation of PT KP, the Group?s assets in Indonesia have been augmented and total assets grew to S$275.6 million as at 30 June 2016, compared to S$205.6 million as at Dec. 31, 2015. While net assets attributable to owners of the Company have decreased by 9 percent due to an increase in payables and loans in relation to the acquisition of PT KP, the Group?s balance sheet remains healthy with net cash position of S$87.8 million.

For the financial results of 2Q 2016, the Group reported a net attributable loss of S$2.6 million, which narrowed 33% from 2Q 2015. Revenue declined 21% year-on-year to S$1.8 million due mainly to the lower coal carrying activities which was mitigated by the foreign exchange gain of S$1.1 million and partially compensated by an increase in transhipments during the period. Vessel-related expenses were lowered by 20%.

As uncertainties continue to persist in the coal industry and global economic conditions, the Group has started executing its diversification efforts into the power plant business which will broaden its earnings base by tapping on the opportunities of a rising demand for electricity in Indonesia. The Group?s subsidiary, PT KP, which owns and operates 2 x 15MW coal-fired steam power plant in the KIK zone in Balikpapan, East Kalimantan, Indonesia, has been given the right by the Indonesian government to supply electricity exclusively within the Kawasan Industri Kariangau (KIK) zone for a period of 15 years from April 1, 2013.

?We are confident that our move into the power business in Indonesia will diversify our revenue stream, especially with its existing power supply agreements,? said David Low, CEO & Managing Director of MRL.

Editing by Johannes Simbolon