Gunung Agung to open new bookstores, distribution center

JAKARTA (JP): PT Toko Gunung Agung, a bookstore owner listed on the Jakarta and Surabaya stock exchanges, will expand its business network nationwide by opening new stores and a distribution center.

"Toko Gunung Agung will open five new bookstores and a distribution center by 1995 to meet increasing demand for books and stationery in Indonesia," the company's president, Haryadi Bakri, told reporters after an annual meeting of the firm's shareholders yesterday.

The new bookstores will be jointly operated with plazas and shopping malls in Jakarta, Surakarta in Central Java and Ujungpandang in South Sulawesi, Haryadi said.

The company, a subsidiary of the Gunung Agung Group, currently has 35 bookstores, operating alone or jointly, in the country's major cities.

"To facilitate smooth distribution of goods to our bookstores, we will operate an internal distribution center," Haryadi said.

The company's director of finance, Sukirno Siswosudarmo, said the expansion program will be financed by the company's retained profits and bank loans.

Sukirno said the opening of each new bookstore, including its five-year rental fee, fixture, furniture and stock, will cost about Rp 1.5 billion (US$692,200).

He said it will not cost the company anything to set up the planned distribution center because the warehouse and supporting vehicles are already available.

Profit

Sukirno said the company's after-tax profit dropped by 32.79 percent to Rp 3.94 billion last year from Rp 5.86 billion in 1992, while its net revenues increased by 12.70 percent to Rp 89.46 billion from Rp 79.37 billion.

Haryadi said the decrease in net profit was caused by the increase in the company's operational costs, including salaries and electricity bills due to opening seven bookstores last year.

Haryadi said in order to reduce salary expenses, the company will utilize a joint salary payment system with stationery producers, whose products are sold in their bookstores.

"The stationery producers are expected to pay the salaries of employees working at their counters in our bookstores," Haryadi said.

Meanwhile, Sukirno said that the company gained a net income of Rp 22.2 billion in the first quarter of this year.

"The company will likely earn a net income of Rp 7 billion and net revenues of Rp 114 billion this year," Sukirno said, adding that the income from the second and third quarters of the year is historically higher than the first quarter.

He said the shareholders meeting also agreed on the distribution of cash dividends of Rp 45.46 (two U.S. cents) to the holders of its 26 million shares on Sept. 20.(02)