Fri, 11 Jun 2004

Semen Gresik predicts rise in production

The Jakarta Post, Jakarta

State-owned PT Semen Gresik (SG), the country's largest integrated cement producer, said domestic cement production was expected to grow by 10 percent this year on higher demand from the property sector.

SG president Satrio said property sales had increased because of the central bank's lower interest rate policy, which prompted more people to buy houses and apartments via bank loans.

"Domestic cement output is expected to grow by 10 percent .... As for SG, we expect our output to grow by 15 percent this year," said Satrio after attending a discussion hosted by the Jakarta Stock Exchange on Thursday.

A six-year low interest rate, coupled with higher economic growth of 4.8 percent this year, has boosted the property sector and the construction industry, increasing demand for cement.

Domestic cement output was 27.5 million tons last year, relatively flat from 27.2 million tons in 2002.

SG, which is headquartered in Gresik, East Java, is 25.53 percent owned by Mexican cement giant Cemex SA de CV.

Last year, the publicly listed company produced 15 million tons of cement.

Satrio also said he was optimistic the publicly listed Semen Gresik would be able to submit an audited version of its 2003 financial report to the Jakarta Stock Exchange management by the end of this month, the final deadline set by the exchange.

The exchange suspended trading in shares of a number of listed companies last week for failing to submit their audited 2003 accounts by the June 6 deadline. But the exchange extended the deadline until end of this month for SG and state-owned telecommunications firm PT Telkom.

Over the past two years, SG has had troubles with its rebellious West Sumatra-based subsidiary PT Semen Padang, which caused the delay in completing its 2003 financial report.