The government’s big infrastructure-spending plans for this year have resulted in two major contractors digging up increased growth in the first quarter, the firms said on Monday.
The first three months saw the country's largest state-owned contractor, PT Wijaya Karya (WIKA), clinch contracts worth Rp 2.7 trillion ($262 million), a jump of about 26 percent from Rp 2.1 trillion during the same period last year. The firm also recorded unaudited revenue of Rp 1.26 trillion for the first quarter, compared with Rp 1.1 trillion in the year-earlier period.
The company said it hoped to secure Rp 3.7 trillion in new contracts by the end of the first half, or about 40 percent of its anticipated Rp 9.4 trillion in new projects for the year.
“We expect that most of the work will take the form of government projects,” said Bintang Pernowo, WIKA’s president director. “We’re currently participating in a number of tenders for government infrastructure projects and will hopefully have secured the contracts by July.” He declined to give details of the tenders.
Bintang said that the firm planned to pay out 30 percent of its 2008 net profit of Rp 156 billion in dividends to its shareholders.
“We’ll move a resolution to this effect during the shareholders’ meeting in late May,” he said, adding that the payout ratio would be the same as last year.
He said that WIKA expected to post Rp 7.4 trillion in revenue this year, an increase of about 14 percent from Rp 6.5 trillion in 2008, while net profit was expected to come in at about Rp 175 billion, up 12 percent from Rp 156 billion last year.
Separately, PT Duta Graha Indah, a private contractor, said that it expected the government’s infrastructure spending plans for this year to help the company maintain its growth trajectory.
As of the end of March, Duta Graha had already secured Rp 148 billion in new contracts, including projects for the construction of roads in the Nias Islands, off North Sumatra, worth about Rp 31.29 billion. The company said it had also secured a joint operating contract with Tokyo-based Tokyu Construction to build schools in Aceh worth about Rp 62.5 billion.
In 2008, the company booked Rp 1.73 trillion in revenue, and expects to grow its contract book this year by about 20 percent, or Rp 12.5 trillion.
Duta Graha said government infrastructure projects in the first three months had produced positive growth for the company of about 62.3 percent compared with the same period last year.
WIKA’s shares closed up Rp 5, or 1.54 percent, at Rp 325 in Jakarta on Monday, while Duta Graha’s fell 1.37 percent to Rp 73.