UT expects 10% growth in revenue on rosier coal outlook
Friday, March 10 2017 - 03:24 AM WIB
Petromindo
IDX-listed heavy equipment and mining company PT United Tractors Tbk (UT) expects consolidated revenue to grow by 10 percent this year, driven by its mining contracting business, heavy equipment sales, and coal mining operation.
?Revenue (this year) will probably grow by 10 percent,? said UT President Director Gidion Hasan recently, but did not provide further details.
Rising trend in the price of coal is expected to help improve the performance of UT?s heavy equipment, coal contracting and coal mine business units.
Last year, the company saw consolidated net revenue decreased by 8 percent to Rp 45.5 trillion compared to Rp 49.3 trillion in 2015, driven mainly by lower coal production volume and revenue from mining contracting business unit. The mining contracting business unit, which accounted for 53 percent of the total revenue, recorded a 21 percent decrease in net revenue last year.
Coal mining services companies in the country are expecting greater business volume this year as coal miners plan higher production amid rising price of the commodity, Kontan reported on Tuesday.
Coal contractor PT Pamapersada Nusantara, a subsidiary of UT, is optimistic for higher coal production this year. ?We expect coal production volume this year to increase by 5 percent,? Sara K. Loebis, Corporate Secretary of UT told the paper.
The paper said that last year, Pamapersada?s coal production stood at 124.5 million tons. Sara is optimistic that with improving coal price outlook this year, Pamapersada will obtain new coal mining contracts.
This portal previously quoted Gidion as saying that UT plans to increase capital expenditure (capex) in 2017 by 20 percent to US$240 million from $200 million allocated for this year.
He said that about 80 percent of the planned 2017 capex will be allocated for Pamapersada Nusantara. ?The funds will be used for the procurement of heavy equipment in coal mining,? Gidion said.
Editing by Reiner Simanjuntak