State firms book profits of Rp 9.32t
State firms book profits of Rp 9.32t
JAKARTA (JP): State-owned companies recorded significant improvements in their financial performances last year, with combined pre-tax profits rising by 20.5 percent to Rp 9.32 trillion (US$4.05 billion) from Rp 7.73 trillion in 1994.
The Ministry of Finance's Director General for State Enterprises, Bacelius Ruru, said yesterday that the financial improvement came from increased efficiency.
Speaking at a hearing of Commission VII of the House of Representatives, for finance and trade, Ruru said the improvement in the financial performances also reflected the increase in the number of state companies categorized as very healthy.
Tax payments from state companies increased to Rp 2.02 trillion in 1995 from Rp 1.93 trillion in 1994, Ruru told the commission.
Dividends paid by the state firms to the government increased to Rp 1.48 trillion last year from Rp 1.39 trillion in the previous year, he said.
Ruru said that the number of state companies classified as "very healthy" increased to 92 last year from 85 in 1994, while those categorized as "unsound" declined to 86 from 97.
He explained that the total number of the country's state firms declined to 178 last year from 182 in 1994 as the result of the government's consolidation programs.
In 1994, for example, PT Pengelola Kawasan Berikat Nusantara merged with PT Kawasan Berikat Nusantara, while PT Semen Tonasa in South Sulawesi and PT Semen Padang in West Sumatra were consolidated into the East Java-based cement plant, PT Semen Gresik.
The Ministry of Trade and Industry directly oversees 33 state companies, the Ministry of Agriculture 22, the Ministry of Finance 29, the Ministry of Transportation 17, the Ministry of Public Works 19, the Ministry of Mines and Energy seven, the Ministry of Post, Telecommunication and Tourism seven, the Ministry of Forestry six, the Ministry of Defense and Security two, the Ministry of Health four, the Ministry of Information four, the Ministry of Manpower one, the Ministry of Education one and the Strategic Industry Supervising Board 10.
Some other state-owned companies are overseen by Bank Indonesia and non-ministerial offices.
The Ministry of Finance, by law, is the sole shareholder of the state-owned companies, which had total assets of more than Rp 358 trillion at the end of 1994, but their daily activities are overseen directly by related ministries or government offices.
Ruru explained that the government would continue restructuring programs in the state-owned companies to allow them to operate as efficiently as private firms.
He said the programs include the consolidation of their operations and management into other, related, companies and privatizations through local and offshore stock exchanges or through direct placement.
Ruru said the government is now preparing the initial public offering of the shares of a number of state companies, including Bank Negara Indonesia, toll operator PT Jasa Marga, subsidiaries of the electricity company PLN, steel corporation PT Krakatau Steel, port management firm PT Pelabuhan Indonesia II, PT Rajawali Nusantara Indonesia, a diversified business group, state plantation firms and the national flag carrier PT Garuda Indonesia.
Ruru told the House members that state companies which go public or sell their shares to the public should meet certain criteria, such as booking profits in the past two consecutive years. Furthermore their paid-up capital should be at least Rp 50 billion, with a minimum rate of return on equity of 7.5 percent. The debt equity ratio should be a maximum of 7.3 for life insurance companies, 4.8 for those operating in the property industry, 19 for those involved in banking activities and 1.8 for those operating in other business sectors. (hen)