PGN first-quarter net rises 34% on transmission fees
PGN first-quarter net rises 34% on transmission fees
Bloomberg, Jakarta
PT Perusahaan Gas Negara, Indonesia's state-controlled gas
distributor, said first-quarter profit rose 34 percent on higher
transmission fees and gas sales.
Unaudited net income in the three months ended March 31
increased to Rp 197.5 billion (US$$21 million) from Rp 147.6
billion, the company told the Jakarta Stock Exchange in a
statement today, without providing earnings per share.
Jakarta-based Perusahaan Gas, which relies on domestic sales
and fees earned distributing gas for most of its revenue, started
transmitting gas to Singapore in 2003.
"This is a fantastic company to hold -- it's like collecting
toll fees for use of their pipeline," said Ami Tantri, a natural
resources analyst at JPMorgan Chase & Co. in Jakarta. "The fees
for the pipeline to Singapore now represent about one-fifth of
sales."
Sales rose 31 percent to Rp 1.21 trillion from Rp 922 billion,
it said. The company more than doubled revenue from distributing
and transporting gas to Rp 166.3 billion from Rp 74.79 billion in
the same period in 2003.
The shares rose Rp 125, or 4.8 percent, to Rp 2,750 at the 4
p.m. close in Jakarta, matching the close on March 14. They have
gained 45 percent this year, more than the 3.3 percent increase
in the benchmark Jakarta Composite Index.
Tantri has an "overweight" recommendation for the stock with a
12-month target price of Rp 2,500 and may change her
recommendation or target, she said. She had raised the price
target on Jan. 19 from Rp 2,000 in her Nov. 30 report.
The company is building a 180-kilometer pipeline linking South
Sumatra province with West Java to boost revenue.
"You don't want to sell this company," Tantri said. "Once that
South Sumatra pipeline is done, it will enjoy good cash flow."
Higher sales helped offset the effect of lower interest rates.
While interest costs fell 34 percent to Rp 55.8 billion, the
company's interest revenue from holding time-deposits and cash
savings declined more, dropping 86 percent to Rp 10.3 billion,
the profit statement said.
The company also incurred a foreign exchange loss of Rp 46.34
billion, compared with a foreign exchange gain of 8.49 billion in
the first quarter of 2004.