Mar 24, 2011

Resource Alam earning soars 418%

Thermal coal producer PT Resource Alam Indonesia Tbk (KKGI), part of Rain Group, posted a 418.84% jump in net income last year as a result of a steep jump in net sales.
In a financial statement published today, Resource Alam booked Rp166.03 billion net income or Rp166 per share last year from Rp32 billion or Rp128 per share in the previous year.
Operating profit surged 390.75% to Rp220.74 billion from Rp44.98 billion, while gross profit augmented 233.24% to Rp476.84 billion from Rp143.09 billion.
Resource Alam's net sales soared 138.39% to Rp969.35 billion from Rp406.62 billion.
The company is eyeing to produce 3.5 million tons of coal in 2011, up 58% year on year. In 2010, the company has sold 2.2 million tons of coal.
Resource Alam expects Rp1.89 trillion revenue this year, a 95.4% increase from 2010 and net profit of Rp413 billion in 2011, a 138.9% rise from last year, assuming average coal selling price of US$59.8 per ton or 24.3% increase YoY.
About 95.4% of its coal was exported with China and India as the main destination, counting for 87.9% of its total sales.
Resource Alam plans to announce one coal asset acquisition within this year. Beside that, KKGI also consider to diversify its business to other mining business like iron ore, bauxite and manganese that have similar model to coal mine.
Total capital expenditure in 2011 is expected around Rp90 billion, where Rp40 billion allocated to its contractor and Rp50 billion is equity portion especially for buying new heavy equipment, and expand its transportation infrastructure.
KKGI has locked 1.7 million tons of coal volume in 1 year contract with average selling price of US$61 per ton FOB vessel, while allocates around 1 million tons to spot market. And the remaining 800,000 tons is allocated to domestic market, supplying to PLN. Around 500,000 tons coal for PLN is priced at US$ 47/ton FOB barge.
Disclosure: No position at the stock mentioned above.
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