Tjiwi Kimia, Indah Kiat expect stronger profit this year

JAKARTA (JP): Publicly listed PT Indah Kiat Pulp and Paper and PT Tjiwi Kimia expect stronger profits this year on the back of higher sales revenues.

Tjiwi Kimia's chief financial officer Gunawan Taslim said on Monday that the net profit in 2000 was expected to reach US$110 million compared to $103.9 million last year.

Speaking to reporters following a shareholders meeting, he said that sales this year were projected to increase by 15 percent amid higher worldwide pulp and paper prices.

Gunawan said that the paper company, a unit of the giant Sinar Mas Group, had a debt of $800 million and planned to repay $200 million in 2001, and the remaining $600 million in 2004.

Meanwhile, chief financial officer of Indah Kiat Robin Maliola said that the net profit this year was projected to grow to about $388 million if pulp and paper prices remained strong throughout the year.

"We had a net profit of $97 million in the first quarter of this year, and if pulp and paper prices remain strong we can annualize this figure to get the full year's net profit," he said following a shareholders meeting.

He said that the international pulp price was expected to remain strong at $700 per ton until the third quarter of next year.

He said the price of pulp touched a low level of $380 per ton in 1998.

Indah Kiat is also a unit of Sinar Mas.

Indah Kiat reached a "net profit" of $152 million in 1999, but the company had to pay $148 million in penalties to a U.S. firm for canceling the purchase of machinery. As a result, the company only booked a net profit of $4 million last year.

Robin said that Indah Kiat planned to repay $200 million of its debt this year.

"Our cash on hand is more than enough to repay our debt," he said.(rei)