UT?s 2015 net profit drops 28 percent on lower sales, impairment loss
Thursday, February 25 2016 - 12:56 PM WIB
IDX-listed integrated mining and service company PT United Tractors Tbk announced on Thursday a net profit of Rp 3.9 trillion in 2015, down 28 percent from Rp 5.4 trillion in the previous year.
Consolidated net revenue during 2015 decreased by 7 percent to Rp 49.3 trillion, from Rp 53.1 trillion in 2014, the firm said in a statement.
The continued decrease in coal price has led the company to assess the carrying value of its coal mining properties and other noncurrent related assets. The company thus recorded an impairment loss in the fourth quarter of 2015. The net impact of the impairment loss charged to profit after tax attributable to owners of the parent was Rp 2.6 trillion (2014: Rp 1.5 trillion). These factors have led to a decrease in the company?s net profit. Excluding the impact of non-cash impairment loss recorded in relation to coal mining properties and other non-current related assets, the company recorded net income of Rp 6.4 trillion (2014: Rp 6.9 trillion) or 7 percent lower.
In the firm?s Construction Machinery segment, subsidiary Komatsu?s sales volume fell by 40 percent to 2,124 units from 3,513 units. On the other hand, after sales services revenue increased by 2 percent to Rp6.1 trillion. Overall, revenues from Construction Machinery segment reached Rp 13.6 trillion or decreased by 9 percent.
Meanwhile, in the Mining Contracting business segment, subsidiary PT Pamapersada Nusantara (PAMA), recorded a decrease in net revenue by 9 percent to Rp30.5 trillion, as well as a decrease in coal production by 4 percent to 109.0 million tons, with overburden removal down 5 percent to 766.6 million bcm. Mining business segment also recorded a decrease by 18 percent to 4.6 million tons, with net revenue declined by 18 percent to Rp3.8 trillion.
Overall, revenue contribution from Mining Contracting, Construction Machinery, Mining, and Construction Industry was 62 percent, 27 percent, 8 percent, and 3 percent respectively.
Construction Machinery
As of December 2015, Komatsu sales volume fell by 40 percent to 2,124 units, lower compared to the sales volume in 2014 of 3,513 units. However, Komatsu is still ranked as market leader in heavy equipment with 36 percent domestic market share (according to internal market research). The decrease in sales of heavy equipment was felt nationwide and this condition was reflected in market volume of heavy equipment in Indonesia which was down from 8,867 units in 2014 to 5,912 units in 2015 (source: internal market research). In line with decreasing demand in mining sectors, sales volume of other UT?s distributed brands such as UD Trucks declined from 171 units to 77 units, while Scania products decreased from 365 units to 246 units.
On the other hand, the revenue of product support increased by 2 percent to Rp 6.1 trillion, due to the need to maintain the life cycle of heavy equipment. Overall, total revenue of Construction Machinery business segment in 2015 decreased by 9 percent to Rp 13.6 trillion, from Rp 15.0 trillion in 2014.
Mining contracting
The company operates its Mining Contracting business through PAMA. In 2015, PAMA was able to maintain 48 percent revenue market share (source: internal market research).
As of December 2015, PAMA recorded a decrease in net revenue by 9 percent to Rp 30.5 trillion, compared to Rp 33.5 trillion in 2014. This performance was the result of decreasing target of coal production, which was 109.0 million tons, compared to 113.5 million tons in 2014, while overburden removal was down from 806.4 million bcm to 766.6 million bcm.
Coal mining
The company?s Mining business segment was operated by PT Tuah Turangga Agung (TTA).
As of Desember 2015, total coal sales volume decreased by 18 percent to a total of 4.6 million tons from 5.7 million tons in 2014. This has caused a decrease in the revenue of mining business segment by 18 percent, from Rp 4.7 trillion to Rp 3.8 trillion. Considering the continued decrease in oil prices, the company has reviewed the carrying value of coal mining properties and other non-current related assets.
The company recognized impairment loss amounting to Rp 4.7 trillion (2014: Rp2.7 trillion) including non-controlling interest and deferred tax. The net cost of mining properties and other non-current related assets impairment was imposed on the company?s profit after tax attributable to the parent entity, which amounted to Rp 2.6 trillion.
Ediitng by Johannes Simbolon