PT Indah Kiat to increase production to 1.2 million tons

JAKARTA (JP): PT Indah Kiat Pulp and Paper aims to be capable of producing 1.2 million tons of pulp per annum by the end of this year, the company said yesterday. Its current capacity is 800,000 tons.

A company executive, Suresh Kilam, told journalists that 35 percent of company's produce would be exported.

The company, which is part of the Sinar Mas Group, now exports 30 percent of its produce.

Commenting on price developments, Suresh said that shipment prices in late June were US$500 a ton for hardwood pulp. Prices are estimated to increase by between $50 and $100 a ton by August.

He said international pulp prices had steadily dropped from a peak of $900 a ton in June 1995 to a low of $330 a ton in April.

Suresh said that Indah Kiat would not face any difficulty getting raw materials after expanding its capacity.

Indah Kiat's 1995 annual report said that in 1996 it would be able to produce 910,000 tons of industrial paper compared to 280,000 tons in 1994.

Its production capacity of culture paper is projected to remain at 1994's level of 1.4 million tons per annum.

Suresh said that Indah Kiat's shareholders had approved the distribution of a cash dividend of Rp 35 (1.4 U.S. cents) per share and eight dividend shares for every 100 original shares.

The total dividend is Rp 71 billion, or 15 percent of the company's 1995 profit.

Indah Kiat's profit rose sharply from Rp 146 billion in 1994 to Rp 468 billion last year, while its sales increased from Rp 1.04 trillion to Rp 2.07 trillion.

Shareholders also endorsed a proposal to increase Indah Kiat's authorized capital from Rp 5 trillion to Rp 10 trillion.

Meanwhile, PT Tjiwi Kimia, another paper producer of the Sinar Mas Group, said it would pay a Rp 60 dividend per share and issue stock dividends.

"In addition to stock dividends, we will issue one bonus share for every 10 old shares," Tjiwi Kimia's president, Yudi Setiawan, said.

Tjiwi Kimia's production capacity is 615,000 tons per annum. It produces an average of 600,000 tons per annum. (alo)