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[News] Barito's First Semester Net Income Surges 807%
Journalists: Abdul Malik & Adi Teguh
PT Barito Pacific Tbk (BRPT) booked a net profit increase of 807.6 percent to Rp 226.4 billion (US$ 25.35 million) in the first half of 2011, compared to the first semester of 2010 with Rp 24.9 billion. Agustino Sudjono, Senior Vice President of Investor Relations of Barito, said that the net profit increase was supported by the 87.9 percent growth in profit before tax to Rp 353.8 billion in the first half. In the same period last year, profit before tax amounted to Rp 188.3 billion.
Barito’s profit increase was also sustained by development in revenues of 13.9 percent to Rp 10 trillion in the period. Its petrochemical business unit accounted for 99.5 percent of the company’s total revenue. The rest came from the forestry, plantation and property sectors.
According to Agustino, the performance in the first half solidified Barito’s plan to implement a quasi-reorganization. It also encouraged efforts to realize the company's short, medium and long term targets.
The quasi-reorganization was originally planned for May 2011. But the State Market Supervisory Agency (Badan Pengawas Pasar Modal dan Lembaga) asked Barito Pacific to postpone it until the annual financial statements are submitted to show a profit.
Quasi-reorganization will be done so that the company can cover a Rp 6 trillion deficit accumulated over the years. Previously, the company's equity amounted to Rp 5.9 trillion. It is expected to increase to Rp 7.1 trillion derived from the additional paid-in capital of Rp 5.9 trillion with the rest coming from revaluation plan assets of Rp 1.2 trillion.
By June 30, 2011, Barito’s cash and cash equivalents reached Rp 1.29 trillion. Agustino said that the sale of the 7.13 percent stake in the company’s petrochemical business unit, PT Chandra Asri Petrochemical Limited, to SCG Chemicals Co. Ltd., a subsidiary of Siam Cement Group, Thailand, will accelerate its expansion plan.
According to the IFT Research Department, the quasi-reorganization is meant to show that the company’s balance sheet has reasonable value, without the burden of past deficits.
After the deficit is eliminated, the company can distribute dividends to shareholders and increase the liquidity of stocks.
On Tuesday’s trade closing, Barito’s share price edged up Rp 70 or 8.75 percent to Rp 870, compared to the previous trade closing.
Barito targets to diversify its revenues from the domination of its petrochemical unit. Agustino said that so far, the majority of company’s revenue is contributed by Chandra Asri.
Barito is currently expanding its palm oil plantation through its subsidiary, PT Grand Utama Mandiri. Of the Rp 16.97 trillion total revenue in 2010, the oil sector accounted for Rp 1.9 billion.
Reza Andriansyah, President Director of Grand Utama, targets a Rp 15 billion revenue this year. This target is estimated to grow threefold in 2012, with the palm oil plantation ready for harvest. The plantation will increase to 6,000 hectares from this year’s 2,000 hectares.
Although the current palm oil sector's contribution to Barito’s earnings is still small, it is estimated that in 2014-2015, the contribution will increase significantly. The estimation is based on the company’s target to add land concession rights from 29 thousand hectares this year, to 50 thousand hectares in 2015.
Barito also targets other income contributions, such as the coal mining business, by using the proceeds from the release of 50 percent stake in Chandra Asri.
Source: Indonesia Finance Today