Mar 31, 2011

Darma Henwa returns in net profit

Indonesia's coal mining contractor PT Darma Henwa Tbk (DEWA) returned to a positive bottom line last year. The company reported to post net income of US$588,128 last year, a 131.83% increase from US$1.85 million net loss in the previous year.
Darma Henwa, which is 28.8% owned by Indonesia's largest thermal coal exporter PT Bumi Resources Tbk (BUMI), booked a 11.39% increase in operating profit to US$5.28 million from US$4.74 million.
Revenue grew 14.21% to US$230.09 million from US$201.47 million. Darma Henwa is awarded contracts at Kaltim Prima Coal's coal mine site Bengalon and Asam Asam. 
Based on Vallar Plc, London-based company which owns 25% shareholding in Bumi, Darma Henwa produced 6 million tons, 6 million tons, and 6.6 million tons of coal in 2008, 2009, and 2010 respectively. The figures represent 11.3% and 9.5% respectively of total coal production of KPC and Arutmin Indonesia in those periods.
In August and September 2010, Bumi Resources experienced a 23-day strike at the Bengalon mine by the employees of Darma Henwa over a dispute regarding payments of holiday bonuses, which is estimated to have caused a loss in coal production of 560,000 tonnes the Bumi Resources could have achieved during this period.

Disclosure: No position at the stock mentioned above.
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