JAKARTA: The plantation unit of Indonesia's PT Astra

JAKARTA: The plantation unit of Indonesia's PT Astra International, PT Astra Agro Lestari, plans to issue around Rp 400 billion in bonds later this year, a source said Tuesday.

"We hope the bond will be issued in the fourth quarter of the year," the source, who declined to be named, told Dow Jones Newswires.

The terms of the bond issue were unavailable, but Astra Agro is expected to offer a bond with a fixed coupon rate to attract investors, who most likely would prefer to buy bonds with a fixed rate rather than a floating rate as domestic interest rates are currently falling.

It is unclear, at this stage, what the proceeds of the issue will be used for, the source said. -- Dow Jones

BP quarterly profit falls

LONDON: British oil major BP announced Tuesday a fall of about one third in second-quarter profit from the year-earlier period but said conditions had improved from the first quarter.

Pro-forma profits, adjusted to take account of exceptional items, fell by 36 percent to US$2.11 billion from the year- earlier period but rose by 38 percent from the first quarter of 2002.

For the first half, pro-forma profit dropped 47 percent from the year-earlier period to $3.76 billion.

"Although the upstream and downstream business environment showed some improvement over the first quarter, the half year's trading conditions were significantly less favorable than a year ago," said chief executive John Browne.

"The world economy continued to recover during the second quarter and further growth is expected in the third quarter, though recent financial market weakness poses a downside risk to this economic outlook.

BP said full-year production remained on track to grow at its target annual rate of 5.5 percent as new projects come on stream. -- AFP

BAT posts 11% jump in profits

LONDON: British American Tobacco on Tuesday reported an 11 percent rise in first-half profits, aided by the absence of a one-off charge and lower interest payments.

BAT, owner of the Lucky Strike, Dunhill and Benson and Hedges brands, reported that pre-tax profit for the six months to June 30 rose to 1.041 billion pounds (US$1.6 billion) from 934 million in the same period a year earlier.

But turnover fell 1.0 percent on the same period a year earlier to 12.478 billion pounds, as cigarette sales declined five percent to 380 billion.

BAT said its performance was adversely affected by currency fluctuations, particularly of the South African rand, which wiped about 40 million pounds off its operating profits.

And, while it said it still expected to achieve high single- figure profit growth for the full year, it warned recent currency movements, particularly the decline of the U.S. dollar, could jeopardize its targets. -- AFP

Nissan to launch fuel cell car

TOKYO: Japanese automaker Nissan Motor Co. Ltd. will launch its first fuel cell vehicle by 2003, two years earlier than planned, president Carlos Ghosn announced Tuesday.

"I can tell you today that the first fuel cell vehicle put on the market by Nissan will be advanced by two years," Ghosn told a news conference.

"We are moving up our fuel cell (offering) from 2005 to 2003," he said.

Nissan said in January it was developing the technology for the environmentally-friendly cars.

Last October Japan's number three car maker and its 44.4 percent shareholder Renault SA of France said they had set aside 85 billion yen (US$708 million) over five years for the project, to be run jointly. Nissan owns 15 percent of Renault.

Rival Honda Motor Co. Ltd's U.S. unit said on July 25 it had received the first U.S. government certificate for fuel cell vehicles, clearing the way for their commercialization. -- AFP

Megabank to set up holding company

TOKYO: Japanese megabank Sumitomo Mitsui Banking Corp. said Tuesday it will establish a holding company by early December to boost its competitiveness as a fully-fledged financial group.

The new firm, named Sumitomo Mitsui Financial Group Inc., will look after three SMBC affiliates -- Sumitomo Mitsui Card Co., SMBC Leasing Co. and Japan Research Institute -- as its wholly owned units, a company statement said.

SMBC's shares in two other affiliates, Daiwa Securities SMBC Co. and Daiwa SB Investments Ltd., will also be transferred to the holding company which will be capitalized at one trillion yen (US$8.3 billion), the statement added.

Daiwa Securities SMBC, a wholesale brokerage, is owned 60 percent by Daiwa Securities Group Inc. and 40 percent by SMBC.

With the reorganization move, SMBC will become the last of Japan's top-four financial groups to be structured into a holding company after Mizuho Holdings Inc., Mitsubishi Tokyo Financial Group Inc. and UFJ Holdings Inc. -- AFP

Losses at Japan's Hitachi shrink

TOKYO: Japan's Hitachi Ltd. said Tuesday its net loss shrank in the three months to June from a year earlier thanks to cost cuts and fresh demand for technology, but it was cautious about future prospects.

The nation's largest electronics firm incurred a group net loss of eight billion yen (US$67 million) in the first quarter against a loss of 34.0 billion yen last year.

It returned to a pre-tax profit of 1.0 billion yen reversing a loss of 25.7 billion yen, but revenue fell four percent to 1,865.2 billion yen.

"Hitachi's first quarter results were better than initially expected thanks to strong performances by information-related equipment and electronic devices," the company said in a statement.

"Together with the sharp appreciation of the yen, the company's operating environment has become increasingly difficult." -- AFP