Gresik fails to meet financial report deadline

Gresik fails to meet financial report deadline

The Jakarta Post, Jakarta

The country's largest cement maker, PT Semen Gresik, expects its
consolidated 2002 financial report to be finalized by December,
after missing an end-of-September deadline.

"I expect the full consolidated report will be completed by
December," Gresik president Satriyo said on Monday.

The publicly listed company has faced difficulties in filing
its report as its West Sumatra-based subsidiary PT Semen Padang
declined to give its financial accounts. For months, a new
management team for Padang could not enter the company due to a
blockade by the old management team. It was only on Sept. 5 that
the new management could finally enter the company.

Gresik was supposed to file the report by the end of August
with the Jakarta Stock Exchange. But the company failed to meet
this original deadline, forcing it to pay penalties to the
exchange.

Satriyo also acknowledged that shareholders would not get
dividends for the 2002 fiscal year due to the delay.

The previous managers of Padang, supported by local
politicians and some employees, for over two years had rejected
the government's plan to sell a majority 51 percent stake in
Gresik and its two subsidiaries (Semen Padang and Semen Tonasa in
South Sulawesi) to Mexico's Cemex SA de CV.

These people had demanded the central government spin off
Semen Padang from Gresik.

Semen Padang's shares are 99.99 percent owned by Gresik, which
is 51 percent owned by the government, 23.46 percent by the
public and 25.53 percent by Cemex, which became Gresik's
shareholders in 1998.

Gresik's combined output is 17.25 million metric tons per
year. Semen Padang contributes an annual capacity of 5.5 million
metric tons, compared to Tonasa's 3.48 million tons.

In the meeting, the company also reported a steep decline in
its first semester unaudited consolidated net profit, as against
the same period the year before, due to higher cost of sales.

Gresik's first half net profit fell to Rp 83.47 billion from
Rp 170.38 billion a year earlier, as sales cost rose to Rp 1.74
trillion.

The 6.7 percent increase in sales cost outweighed the 3.5
percent rise in sales to Rp 2.49 trillion.

While foreign exchange gains also fell to Rp 7.58 billion from
Rp 69.80 billion, all resulting in a decline in the gross profit
to Rp 752 billion from Rp 775.5 billion.

In another part of the meeting, Satriyo also reiterated the
company's plans to seek fresh funds to refinance its debts, which
amount to Rp 1.2 trillion.

To do that, he went on, the company might issue commercial
papers and seek more bank loans, whose interest rates of around
12 percent to 13 percent at the moment would be lower than the
loans' rate of 16 percent to 18 percent it has been shouldering
so far.

Gresik's debts are Rp 600 worth of bonds, and Rp 590 billion
in bank loans.

As much as Rp 117 billion of the bonds, issued in 2001, is to
mature in July 2004 and another Rp 493 billion in 2006, Satriyo
said.