JSX resumes trading on Lonsum shares

The Jakarta Post Jakarta

The Jakarta Stock Exchange (JSX) has decided to resume trading in shares of plantation company PT PP London Sumatra (Lonsum), as a problem with the company's dividend payment has been resolved.

In its statement on Thursday, the JSX said it had lifted the trading suspension on Lonsum shares in the morning session upon the company's decision to cancel its plan to pay a final dividend from its 2003 net profit.

The JSX halted on Tuesday trade in Lonsum shares following the company's plan to pay dividend despite its accumulated losses of about Rp 150 billion (US$16 million) in 2003.

Companies with negative retained earnings are not allowed to pay dividend by regulation.

Lonsum shareholders approved on June 23 a dividend payment of Rp 10 per share, or 3.3 percent of its 2003 net profit of Rp 311 billion. It was to be the company's first dividend payment since 1998.

In a report to the JSX on Thursday, Lonsum president director and former chairman of the now-defunct Indonesian Bank Restructuring Agency Glenn Yusuf said: "The company has revoked plans to pay the dividend. However, the company remains committed to pay dividend to its shareholders in the form of interim dividend based on its 2004 financial accounts."

Elsewhere in the report, Glenn said Lonsum had signed a $75 million loan agreement with a syndicate as part of its program to refinance its long-term debts.

The syndicate includes Bank Negara Indonesia as arranger and agent, and PT NC Securities and Bank Niaga as participants.

Lonsum shares ended higher on Thursday on the local bourse by Rp 75 and closed at Rp 975 after the suspension.

Lonsum said it expected sales to surge by 15 percent to Rp 1.4 trillion this year, primarily due to an increase in sales of its crude palm oil, which is expected to reach 340,000 metric tons, up from Rp 267,000 metric tons last year.