PT Tugu Pratama gained net profit of Rp 137b in 1997
PT Tugu Pratama gained net profit of Rp 137b in 1997
JAKARTA (JP): The monetary crisis has given a windfall profit
to PT Tugu Pratama Indonesia, an insurance arm of state oil and
gas company Pertamina, the company said yesterday.
Company president director Sonni Dwi Harsono said the company,
which is one of the country's leading insurance firms, booked a
net profit of Rp 137 billion (US$13.7 million) last year, almost
three times as much as its 1996 profit of Rp 50 billion.
"This is because our operation is mostly based in dollars. We
capitalized on the sharp appreciation of the dollar against the
rupiah," Sonni said, adding that 80 percent of the company's
policies were based in dollars.
He said about Rp 150 billion of the company's gross profit of
Rp 213 billion last year was due the dollar's appreciation
against the rupiah.
The company had projected a net profit of Rp 98.5 billion on
the assumption that its foreign exchange earning was based on an
exchange rate of Rp 5,000 per dollar.
Tugu Pratama offers indemnity insurance to the country's oil
and gas industry as well as other industries like aviation and
marine transportation. Seventy percent of its business is from
oil and gas firms.
The company insures oil and gas companies against loss during
exploration, exploitation, storage and transportation.
The company is 45 percent owned by Pertamina and 20 percent by
Pertamina's pension fund. The remaining 35 percent is held by PT
Nusantara Ampera Bhakti (Nusamba), controlled by timber tycoon
Mohammad Hassan.
It is one of the most profitable subsidiaries of Pertamina.
In terms of dollars, Tugu's profit actually decreased by 20
percent last year due to a worldwide downturn in the oil and gas
industry over the past several years, Sonni said.
The downturn caused an overcapacity in the insurance market
for the oil and gas industry, forcing insurance firms to cut
their rates in the tight competition for customers, he added.
Sonni said Tugu Pratama was trying to lessen its dependency on
the country's oil and gas industry by expanding services to other
industrial sectors, as well as to overseas oil and gas
industries.
"When Tugu Pratama was established in 1981, 90 percent of its
operation was in the country's oil and gas industry but we now
have lowered the percentage to only 70 percent," he said.
Company finance director A.R. Indrakesuma told The Jakarta
Post that Tugu Pratama was going to open an office in the Russian
territory of Sakhalin next month to cater to the growing demand
for indemnity insurance from the area's oil and gas industry.
The company was also studying the possibility of opening
offices in Mongolia, Georgia and Myanmar in the near future, he
said.
"We are going at the invitation of the local authorities who
want us to provide insurance services to their oil and gas
industries," Indrakesuma said, adding that the company was
considered the leading oil and gas insurance firm in Southeast
Asia.
Currently, the company has offices Hong Kong, London,
Singapore and Kuala Lumpur.
Indrakesuma said Tugu Pratama expected its current overseas
operation to contribute between 10 percent and 20 percent to the
company's revenue and hoped to increase the percentage in the
future. (jsk)