Firms will not pay dividends for '98

JAKARTA (JP): Publicly listed companies PT Bayer Indonesia and Sumi Indo Kabel announced on Friday that they would not pay dividends for 1998.

Bayer president director Wolfgang Piroth said the company booked some profit last year, but still suffered a loss because of the high operational costs resulting from high lending rates during the year.

He said the company booked a strong increase in operating income to Rp 8.6 billion last year.

"But after interest and taxes, the company sustained a net loss of Rp 15.4 billion, against a Rp 1.6 billion profit in 1997," he told the company's shareholders meeting on Friday.

Piroth said the high interest rate resulted in a soaring interest burden of Rp 49.8 billion, up from Rp 15.8 billion in 1997.

Bayer is owned by Germany's Bayer AG, with a 75.99 percent stake, PT Bayer Kimia Farmasindo, formerly PT PD Djawa Maluku (3.82 percent), PT Bima Nuansa Perkasa (6.66 percent), Zaidatun Osman (1.18 percent) and the investing public (12.35 percent).

Shareholders approved the management's plan to raise its capital to Rp 64 billion from Rp 32 billion through a rights issue.

Piroth said the capital injection, the second in two years, was expected to improve the company's financial basis to compensate for 1998 losses.

He said that after the increase, the company's capital would be made up of 58.33 million of Series A shares and 5.66 million of Series B shares, each with a nominal value of Rp 1,000 per share.

The company expected to raise Rp 40 billion in fresh funds from the rights issue to be used to increase its equity-to-asset ratio from 17 percent to 23 percent, he said.

Publicly listed cable manufacturer Sumi Indo also plunged into the red in 1998 despite better sales.

Executive director Kusuo Sanjo said Sumi Indo's total sales, in fact, increased to Rp 392.2 billion from Rp 235.2 billion in 1997.

"But the company still suffered a loss of Rp 28 billion in 1998," he said in the company's shareholders meeting. In 1997, the company suffered a loss of Rp 36 billion.

The shareholders meeting also approved a reshuffle of Sumi Indo's management, with Sanjo appointed a new member of the board of commissioners and Katsuichi Chikazawa replacing him as the president. (cst)