PT Indorama sets net profit target of Rp 148 billion
PT Indorama sets net profit target of Rp 148 billion
JAKARTA (JP): Publicly listed polyester producer PT Indorama
Synthetics has set a net profit target of Rp 148 billion and
sales target of Rp 934 billion this year and is preparing
capacity expansions to support their goals.
Indorama's Managing Director S.P. Lohia said yesterday after
the firms annual shareholders' meeting: "We will invest about
US$250 million this year and in 1998, to increase our polyester
textured yarn capacity by 50 percent".
The company bucked the industry's trend by increasing its
polyester output and exports last year while the world polyester
industry suffered a steep drop in capacity utilization.
Indorama said it benefited greatly from being the only
Indonesian company exempted from the anti-dumping duties imposed
by the European Union on imports of polyester textured yarn from
Indonesia last year.
As a result, the company booked a net profit of Rp 122 billion
last year from total sales of Rp 678 billion.
Lohia said yesterday the company would provide about 30
percent of the investment and finance, and 70 percent would come
from offshore loans.
"But the equity investment will be taken out of our retained
earnings," he said.
He said Indorama would also build a power generation plant at
its plant in Purwakarta, West Java.
"The power generation project is part of the new investment
package," he said.
He said Rp 32.71 billion of last year's profits would be
distributed as dividends and the remaining Rp 89.47 billion would
be kept as retained earnings.
He said the company's steady performance was supported by its
high quality yarn which earned premium prices.
He said the global market, which saw a downward trend in
polyester products in the middle of 1995, had recovered in the
third quarter of 1996.
He said prices of fibers such as rayon and acrylic were
expected to stabilize this year.
"The stability in raw material prices is expected to enable
the company to achieve its sales and income targets this year,"
he said.
Indorama's Senior Manager for Finance V.S. Baldwa said the
company had booked total sales of Rp 195.55 billion in the first
quarter this year, up 23 percent from Rp 158.06 billion in the
same period last year.
The company also posted a net profit of Rp 36.17 billion in
the January to March period this year, up 77 percent from the
same period last year, Baldwa added.
Indorama Synthetics, which was established in 1974, produces
polyester filament yarn, polyester staple fiber, PET resin, spun
and blended yarns, polyester fabrics.
The company is 19.79 percent owned by Indorama International
Finance PLC, United Kingdom, 38.70 percent by PT Irama Unggul,
4.40 percent by International Finance Corporation and 37.11
percent by the public. The Philippines' Asian Institute of
Management judged it the best managed Indonesian company for
operations management in 1995. (09)