Pertamina revises 2018 financial report

State owned energy company PT Pertamina is revising its 2018 financial report to adjust changing in the fuel price formula set by the government, the effective of which dated back to Jan. 1, 2018, a company top official said.

"The financial report is being recalculated by the BPK (Supreme Audit Board) due to the new fuel price formula which became effective since January 1, 2018," Finance Director of Pertamina Pahala N. Mansury was quoted by Bisnis Indonesia.

In April 2019, the Ministry of Energy and Mineral Resources (MEMR) issued Ministerial Decree No. 62 K/10/MEM/2019 which stated that the basic price of certain fuel and fuel under special assignment is determined based on the cost of production which is calculated on monthly from the date of 25 in previous month to 24 in the following month, cost of distribution, storage cost as well as margin.

The basic price formula of certain fuel is determined based on the following formula. The price of kerosene is set based on the formula of 102.49 percent of the market price index (HIP) of kerosene+Rp263.00 per liter. While, the diesel price is set based on the formula of 95% of the HIP of diesel + Rp802.00 per liter.

As for subsidized premium or fuel under special assignment, the price formula is set as 96.46 percent of HIP for RON 88 + Rp821.00 per liter.

Given the financial report revision, Pertamina's profit in 2018 is expected to be lower than in the previous year due to higher external costs.

Recently, President Director of Pertamina Nicke Widyawati claimed that the company booked net profit of around US$2 billion, lower than net profit in the previous year of US$2.54 billion.  In 2017, Pertamina recorded unaudited net profit at US$2.41 billion. (*)