UT expects revenue to increase next year on coal price recovery
Saturday, November 5 2016 - 02:37 AM WIB
IDX-listed heavy equipment and mining firm PT United Tractors Tbk (UT) said that sales revenue next year is expected to increase by 10-15 percent on coal price recovery.
UT Finance Director Iwan Hardiantoro said on Friday that the recovery in the coal price, which is projected to average around US$70 per ton next year, will help increase heavy equipment sales in the key mining sector, and revenue from its coal mining contracting business.
?Going forward (next year), probably we could grow (revenue), hopefully by about 10 percent to 15 percent,? he said.
Iwan said that the domestic heavy equipment market has been on a declining trend from 2011 to 2015, due to a combination of weaker market in the mining sector segment because of falling commodity prices, and lower economic growth at home.
He, however, said that the market has bottomed out this year, with expected sales volume this year of 4,800 units, flat compared to last year. UT hopes its heavy equipment sales next year to increase by 2-3 percent. The company expects to sell 2,100 units of heavy equipment this year, relatively flat compared to 2,124 last year.
Iwan said that that the recovery in coal price will reinvigorate its mining contracting business. He said that overburden removal volume is projected to increase by 5-10 percent, while coal production form owned mines will increase by 3-5 percent.
Meanwhile, coal sales volume from its coal mine run by PT Asmin Bara Bronang is expected to increase by 1 million tons next year from this year?s target of 6.7 million tons.
UT saw net profit in the January-September period of this year dropped by 44 percent to Rp 3.1 trillion from Rp 5.6 trillion in the corresponding period of last year as the mining sector continued to suffer from the commodity downturn of the past four years.
UT said in a statement on Thursday that as of September 2016, the company recorded net revenue of Rp 33.9 trillion or down 11 percent compared to Rp 38.3 trillion in the same period in 2015.
Editing by Reiner Simanjuntak