Tambang Timah's net profit rises 350%

Tambang Timah's net profit rises 350%

JAKARTA (JP): The net profits of publicly listed mining firm
PT Tambang Timah rose by more than 350 percent to Rp 454.9
billion (US$60.65 million) in the first nine months of this year,
up from Rp 100.6 billion over the same period last year, the
company said in a statement released on Thursday.

The company said that its sales increased by 243 percent to Rp
1.58 trillion in the third quarter of this year alone.

Tin production increased by 4.8 percent to 32,225 tons during
the first nine months of this year, up from 30,763 tons over the
same period last year, the company said.

Although world tin prices are stronger than those for other
base metals, average prices declined by 2.5 percent in the first
nine months of this year to US$5,586 per ton. The average price
over the corresponding period last year was $5,727 per ton, the
statement said.

"But lower tin prices were compensated for by a favorable U.S.
dollar-rupiah exchange rate resulting in higher sales revenues,"
the statement said.

The company generates most of its revenue in American dollars
while most of its production costs are quoted in rupiah.

The statement said that total tin concentrate production for
the period surged by 3.8 percent to 32,712 tons, up from 33,942
tons in the same period of last year.

Company president Erry Riyana Hardjapamekas said on Thursday
that the recent strengthening of the rupiah toward the Rp 7,000
level against the U.S. dollar would not affect the company's
profitability.

The company's tin output is expected to reach 40,000 tons this
year on the back of bright prospects facing the country's mining
industry, Erry told journalists on the sidelines of an Indonesia
Forum business conference.

He also said that the company was currently negotiating the
purchase of a 23 percent stake in PT Kaltim Prima Coal (KPC), the
country's largest coal mining firm.

"We have not arrived at a price yet, but hopefully
negotiations will be concluded in April next year," he told the
media on the sidelines of a seminar here on Thursday.

KPC, which operates Indonesia's largest coal mine in Sangatta,
East Kalimantan, is a joint venture between the U.K.-based
British Petroleum Co. and Rio Tinto PLC.

The company, which started production in 1992, is required to
divest up to 51 percent of its shares to Indonesian corporations
after the first five years of production.

The company is obliged to divest a 15 percent stake in the
first year of its operations followed by an 8 percent stake in
the second year.

Tin mining firm PT Tambang Timah is among state-owned
companies earmarked for privatization under a government
initiative to generate US$1.5 billion in the current fiscal year.

Tambang Timah shares are listed on both the Jakarta Stock
Exchange (JSX) and the London Sock Exchange. (jsk/aly)