Sampoerna suffers Rp 180b in net loss 1998: Director

Sampoerna suffers Rp 180b in net loss 1998: Director

JAKARTA (JP): Publicly listed cigarette manufacturer PT
Hanjaya Mandala Sampoerna suffered a Rp 180 billion (about US$21
million) net loss in 1998, compared to a net profit of Rp 20.3
billion in 1997, the company's director, Ekadharmadjanto Kasih,
said on Tuesday.

Eka said the company recorded an operating income of Rp 1.07
trillion in 1998, a 75 percent increase from the figure in 1997,
but the huge foreign exchange losses during the year put the
company into the red.

"The negative net income was due to the company's Rp 900
billion foreign exchange loss recorded by the end of 1998," Eka
told a press briefing on the company's unaudited 1998 financial
statement.

The sharp depreciation of the rupiah against the U.S. dollar
has become a great financial burden to the company, as most of
its foreign debts were unhedged.

The rupiah, which was only about Rp 2,500 against the
greenback before the crisis hit Southeast Asian countries in
July, 1997, plunged to a low of Rp 17,000 in January last year.
The rupiah managed to stabilize to the range of Rp 8,000 and Rp
9,000 in the second half of last year. On Tuesday, the rupiah
traded at Rp 8,975 to the dollar.

Eka said Sampoerna's outstanding U.S. dollar debts, which
reached a total of $430 million in 1997, declined to $380 million
in 1998.

He estimated that the foreign debt was expected to further
fall to $250 million by the end of this year.

"Practically all of the company's debt exposure is in the U.S.
dollar," Eko said, adding that some of its debts are in the form
of bonds worth $200 million.

Bonds worth $107 million have been repaid at an aggregate
discount of 50 percent, he said.

Sampoerna has recently reached an agreement with its major
bond holders to convert a part of the bonds into the company's
equity, he said.

The bonds to be converted into equity could be worth 3.1
percent of the outstanding shares, he said.

The company, according to Eka, also has a loan of US$140
million from a syndicate of 14 foreign banks, which was jointly
arranged by the Chase Manhattan Bank and Bank of Tokyo
Mitsubishi. The loan will mature on June 3 this year.

"Sampoerna is trying to reschedule its syndicated loan for
another four years of loan tenor. Currently, we are paying our
financial obligation to the syndication banks on time," Eka told
reporters.

Eka predicts Sampoerna's sales performance in 1999 will be
around the same level of that last year. The sales volume in 1998
increased by three percent from the previous year. (02)