AOP to acquire more parts makers<\/p>\n
Rendi A. Witular, Bogor<\/p>\n
Automotive component producer PT Astra Otoparts (AOP) plans to
\nfocus on expanding its domestic business next year by acquiring
\nsmaller component companies and factories, and increasing output,
\nthe company's senior official said.<\/p>\n
AOP finance director Widya Wiryawan said the company plans to
\nallocate some Rp 300 billion (US$33 million) for capital
\nexpenditure (capex) next year, in order to support the expansion
\nof its replacement component business.<\/p>\n
\"For next year, we may allocate capex amounting more or less
\nsimilar with this year. The funds will be used to increase our
\nproduction facilities, buying component factories and companies,\"
\nsaid Widya recently.<\/p>\n
Widya explained that since early this year, the company had
\nacquired a few smaller component producers, such as PT Mopart
\nJaya Utama in August, and production facilities, such as those in
\nSidoarjo, East Java in February.<\/p>\n
The publicly listed company has also diversified its
\nproduction lines, such as producing ball joint and tie-rod, floor
\nshift transmission for Avanza and Xenia van, shock absorbers for
\nHonda Supra motorcycle. The company has also developed new
\npainting facilities for motorcycle maker PT Astra Honda Motor.<\/p>\n
To finance the projects, AOP has already spent, as of August,
\nsome Rp 150 billion of this year's total capex allocation of Rp
\n300 billion.<\/p>\n
Widya said the company, which currently has 24 subsidiaries,
\nwould consider seeking for external financing scheme next year to
\nsupport its expansion plans if its capex was deemed inadequate.<\/p>\n
In the first six months of this year, AOP recorded a currency
\nloss of Rp 30.9 billion, from a profit of Rp 11.4 billion in the
\nsame period of last year. The currency loss is mainly due to a
\ndrop in the value of the rupiah against the U.S. dollar, which
\nincreases the company's dollar-denominated debt burden.<\/p>\n
The loss has reduced the company's net profit to Rp 108.3
\nbillion in the first half of this year, as against Rp 132.3
\nbillion in the corresponding period of last year.<\/p>\n
Widya said the company does not hedge its dollar-denominated
\ndebts, totaling $21 million, against currency fluctuation because
\nof the high hedging cost.<\/p>\n
Automotive conglomerate PT Astra International owns 86.45
\npercent shares in AOP, while the remaining 13.55 is owned by the
\npublic.<\/p>",
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