PLN books RP 2 trillion in net losses
Leony Aurora, The Jakarta Post, Jakarta
State power firm PT PLN suffered a net loss in 2004 of Rp 2.02 trillion (US$211 million), but was able to book a operational profit for the first time since the 1997 monetary crisis.
PLN recorded an operational profit of Rp 2.56 trillion last year, from an operational loss of Rp 3.5 trillion in 2003, the company's president commissioner, Roes Ariawijaya, said after a general shareholders meeting on Tuesday.
"In principal, we are pleased with PLN's audited financial report," said Roes, who represented the Office of the State Minister for State Enterprises at the meeting.
The company's net loss in 2004 was an improvement on the net loss of Rp 5.9 trillion in 2003, he said.
PLN booked a pretax profit of Rp 1.44 trillion last year, while its profit before interest, taxes, depreciation and amortization stood at Rp 14.1 trillion, which if converted to U.S. dollars was roughly equivalent to precrisis levels.
Despite the improved performance, the meeting decided against paying employee bonuses.
A decision last year to award Rp 238 billion in bonuses to the board of commissioners, board of directors and other company employees was met with a public outcry given PLN's lackluster performance.
PLN president director Eddie Widiono said the discussion on bonuses began when the board of directors proposed a raise. "We have been requesting raises since 2002, but they have never been approved."
Roes said the raises could not be approved last year because they would have added an additional burden to PLN's cash flow.
"The board of commissioners, board of directors and shareholders all agreed to give a bonus to show our appreciation for PLN's achievement in improving its performance," he said.
PLN and the government have traded blame over who was responsible for the decision to award bonuses in 2004. The police are investigating the possibility of corruption in the case.
Meanwhile, Eddie indicated it would be difficult for the power firm to return to the black this year, particularly after the government raised fuel prices by an average of 29 percent on March 1.
"The government has said that it will not raise electricity rates this year," he said.
Many power plants in the country are still operating on diesel fuel.
"We have targeted a net income this year without raising rates, calculating in the government subsidy," said Eddie.
However, he added, the amount of the subsidy had not yet been decided on.
The government subsides power for small, individual customers.
PLN's finance director, Parno Isworo, said the company's budget assumed a subsidy of Rp 8.6 trillion.
"We are trying to get Rp 3.9 trillion from the revised state budget," he said, without elaborating on where the company planned to obtain the rest of the subsidy.