Antam profit surges by 306 percent

The Jakarta Post, Jakarta

Publicly listed mining company PT Aneka Tambang said on Monday net profit had more than tripled in the first half of this year from the same period last year due to higher commodity prices and nickel ore sales volumes.

Antam's net profit jumped by 306 percent to Rp 374 billion (US$40 million) in the first half-year ending June 30, from Rp 92.218 billion in the same six-month period last year, the company said.

Earning per share for the first half of 2004 were Rp 196.15.

"The major reason for the increased revenue are the higher average selling prices of all Antam's products," the company said.

The average price for nickel contained in ferronickel rose 57 percent over the first half of 2003 to $6.16 a pound. Nickel prices have been bullish, spurred on by strong global demand, particularly from China, and because of a limited supply.

Ferronickel sales volumes decreased 33 percent to 3,080 tons compared to the same period last year. The company is planning to sell 8,000 tons of contained nickel in 2004.

In the second half of 2004, the company plans to carry out an overhaul of the FeNi II smelter facility. The plan is expected to decrease ferronickel production and sales volume.

Higher prices of gold had offset declining sales volumes in Antam's gold division. The price of gold has been increasing because of geopolitical insecurity and a weaker dollar, the company said. Antam's gold bars increased in price to $412.12 a troy ounce -- up 18 percent from last year.

In the first six months of this year, Antam's cost of sales increased 6 percent to Rp 692 billion. The company attributed the increase to materials, ore exploitation services, labor costs and depreciation. These four components accounted for 73 percent of the total cost.

However, the increase sales costs did little to affect the company's profit, as it was able to lower its indirect labor, water and electricity costs and repairs and maintenance charges, it said.

Antam's share price rose by Rp 25 to close at Rp 1,200 a share on the Jakarta Stock Exchange.