UT net income up 11%
Friday, February 27 2015 - 01:01 AM WIB
IDX-listed heavy equipment company PT United Tractors Tbk (UT) said that net income in 2014 increased by 11 percent to Rp 5.37 trillion from Rp 4.83 trillion in the previous year on higher revenue.
The company, which distributes Komatsu brand heavy equipment, said in a statement Thursday that consolidated net revenue in 2014 recorded an increase by 4 percent to Rp53.14 trillion from Rp51.01 trillion in 2013.
?The favorable exchange rate serves as one major factor that generates positive impact, thus increasing the Company?s gross profit by 27 percent,? said UT, which also operates mining services and coal mining subsidiaries.
UT said the continuing decrease of the coal price led it to assess its mining properties value and determine provision of impairment of this mining property. The provision charge to profit after tax attributable to owners of the parent was amounted to Rp1.54 trillion.
Construction machinery segment recorded a decrease in Komatsu sales volume by 16 percent to 3,513 units from 4,203 units, the company said. On the other hand, revenue of spare parts and maintenance services increased by 8 percent to Rp5.98 trillion. Added with the impact of US Dollar strengthening made the total net revenue from construction machinery segment was only down 4 percent to Rp14.98 trillion, UT said.
It said that mining contracting business segment, through PT Pamapersada Nusantara (PAMA) recorded a 6 percent increase in net revenue amounted to Rp33.49 trillion. ?This performance was made possible by increased coal production volume and hauling reached 119.4 million tons or up 14 percent, despite a decreased of overburden removal, which was 806.4 million bcm or decreased by 5 percent,? the company explained.
Mining business segment recorded a 42 percent increase in coal sales volume to 5.94 million tons and recorded a 22 percent increase in revenue to Rp4.67 trillion.
On January 5, 2015, UT through its subsidiary, PT Karya Supra Perkasa has acquired 40 percent shares in IDX-listed construction firm PT Acset Indonusa Tbk (ACST) from two majority shareholder of ACST, namely PT Cross Plus Indonesia and PT Loka Cipta Kreasi.
Mining contracting
The company operates its mining contracting business through its subsidiary PT Pamapersada Nusantara (PAMA). As of December 2014, PAMA was able to maintain 45 percent revenue market share (based on internal market research).
Until December 2014, PAMA booked an increase on coal production and hauling by 14 percent from 105.1 million tons to 119.4 million tons, while the overburden removal decreased by 5 percent from 844.9 million bcm to 806.4 million bcm. As a result, revenue for the Mining Contracting segment rose by 6 percent to Rp33.49 trillion from Rp31.55 trillion in 2013 and continued to be major contributor by contributing 63 percent of the company?s total consolidated revenue.
Coal mining
The company?s mining business segment was operated by PT Tuah Turangga Agung (TTA) as well as some coal mining concession owned by TTA and has been in operation namely PT Prima Multi Mineral, PT Asmin Bara Bronang and PT Duta Nurcahya.
Total coal production capacity of Mining business increased in 2014, causing United Tractors to have an increase in coal sales volume by 42 percent or a total 5.94 million tons, compared to 4.18 million tons in 2013. This has caused an increase in revenue of Mining business by 22 percent, from Rp3.81 trillion in 2013 to Rp4.70 trillion.
However, a decrease in the average selling price of coal has reduced its profitability rate.
The company said it has completed a review of the carrying value of its coal mining properties due to the continuing decrease of the coal price, and has consequently impaired its coal mining properties at the 2014 year-end.
The company said it recognized an impairment charges amounted to Rp 2.74 trillion, included non-controlling interest and deferred tax. The net impact of impairment on United Tractors?s attributable profit after minorities and taxes is Rp 1.54 trillion.
Construction machinery
As of December 2014, Komatsu sales volume was 3,513 units or 16 percent lower than last year?s volume of 4,203 units. The decrease was still mainly impacted by the slowing down in mining and plantation sectors, that reflected in market volume of heavy equipment in Indonesia which was down from 10,252 units in 2013 to 8,867 units in 2014 (source: internal research). Throughout 2014, Komatsu managed to maintain its position as market leader in the local heavy equipment market by recording 40% market share (source: internal market research). The lower activity in mining sector also caused a decrease in sales of UD Trucks from 365 units to 171 units, and Scania trucks from of 445 units to 365 units.
On the other hand, due to the growing need from customers to maintain the life cycle of their heavy equipment, revenue of spare parts and maintenance services increased by 8 percent to Rp5.98 trillion. However, the increase in spare parts sales and maintenance services during the year was not able to push the total revenue of construction machinery business line, which recorded a decrease to Rp14.98 trillion compared to Rp15.64 trillion in 2013.
Editing by Reiner Simanjuntak