Timah suffers loss in Q1

By Thomas R. Sembiring

IDX-listed tin giant PT Timah Tbk swung to a loss in the first quarter of this year due to a combination of falling price of the commodity and escalating cost.

The company reported that it booked a 19.1 billion loss in the March quarter of this year compared to a net profit of Rp 95.02 billion in the corresponding period of last year.

Although tin price has fallen since the beginning of the year, the company managed to booked a 9.5 percent increase in revenue to Rp 1.36 trillion in the first quarter of this year compared to the same period of last year, thanks to a nearly 23 percent increase in sales volume of tin metals.

However, cost of revenue escalated by 32.6 percent to Rp 1.2 trillion. As a result, the company's gross profit tumbled to Rp 145 billion during the quarter from Rp 325 billion in the same period of last year, while operating profit dropped to Rp 1.8 billion from Rp 177.49 billion.

President Director of Timah Sukrisno said that to help cope with the current market downturn the company will continue diversification strategy and efficiency measures to reduce cost of production.

Sukrisno said the target is for the cost to go down to US$ 15,000 per ton this year. He did not provide comparative figure.

To help cut down cost and help lift tin price, the company will limit export, he added. Offshore exploration will also be the firm's focus as it is cheaper than onshore exploration.

In the first quarter of this year, tin ores output increased by 7.08 percent from 6,213 tons in the same period of last year, while tin metal production rose by 37.07 percent to 5,148 tons in the corresponding quarter of last year.

Editing by Reiner Simanjuntak