KIA expects profit jump

JAKARTA (JP): PT Keramika Indonesia Asosiasi (KIA) of the Ongko Group expects to double its net profits this year to around Rp 22 billion (US$9.3 million), in line with a significant increase in its production capacity.

KIA's president, Sugiarta Gandasaputra, told journalists here yesterday that the drop in company's net profits, from Rp 14.5 billion in 1994 to Rp 11 billion last year, was due to spending on several expansion projects. He also attributed the drop to a change in KIA's accounting system, which required the company to amortize costs of initial public offerings within five years, instead of the 10 years previously allowed.

"We will increase the production of wall tiles from last year's 2.3 million square meters to 6 million square meters this year and floor tiles from 1.7 million square meters to 5.8 million square meters," Sugiarta said.

He estimated that the company's net sales will reach Rp 155 billion this year, as compared to Rp 100 billion last year and Rp 103 billion in 1994.

"In line with the decline of construction projects in the country this year, the company will try to increase exports, besides improving its retail sales domestically," he said.

Meanwhile, KIA's marketing director, Johny Katio, said that retails accounted for about 70 percent of the company's total sales last year. The remaining 30 percent came from sales to property projects. (alo)