Indorama out to dominate polyester market

JAKARTA (JP): PT Indorama Synthetics, which will become the largest polyester producer in Indonesia next year, yesterday reported a 12 percent increase in its net profit to Rp 50.30 billion (US$23.4 million) last year.

Vice president director S.P. Lohia told the company's annual general shareholders meeting at its headquarters in Purwakarta, West Java, that profits increased significantly despite the decline in filament prices due to what he called dumping practices by South Korea and Taiwan.

"Better management of working capital, high capacity utilization, higher value added products and larger sales have contributed to the increased profitability," Lohia said.

He said when Indorama's new US$150 million plant begins operating next year, the company will become Indonesia's largest polyester producer with a daily capacity of 540 tons.

"This will enable Indorama to operate with economies of scale and be globally competitive," Lohia pointed out.

The meeting approved management's proposal for a dividend of Rp 190 per share to be paid for the year 1993, up from Rp 175 in 1992.

He said the additional polyester production capacity would meet the demand for polyester fibers and filament which had been growing at an annual rate of more than 10 percent.

The factory's present capacity utilization has reached 124 percent while its turnover has increased 25 percent, Lohia added.

The financial report for 1993 showed that the company's export turnover increased to Rp 109 billion from Rp 97 billion in 1992 and its total turnover rose to Rp 302 billion from Rp 242 billion.

Touching on the company's latest developments, he said that Indorama's fabric division came on stream last December and was expected to achieve full capacity this year.

Indorama is 34.39 percent owned by Brookgrange International Finance Ltd. of the United Kingdom, 31.82 percent by PT Irama Unggul, 4.73 percent by the International Finance Corporation, an affiliate of the World Bank for private sector development and 29.06 percent by the investing public. (09)