Jan 18, 2012

Delta Dunia boosts capex to US$300 mio

PT Delta Dunia Makmur Tbk (DOID), Indonesia's second largest coal contractor, will jack up capital expenditure (capex) to US$250 million-US$300 million this year in a bid to underpin spare part replacement on its heavy equipments. 
Director Ariani Vidya Sofjan at Delta Dunia said many clients want to grow this year."We try to support them with equipments. We have source of financing to meet our capex," she said yesterday.
In 2011, Delta Dunia, parent of PT Bukit Makmur Mandiri Utama (BUMA) which controls 16.7% market share in coal contracting business in 2009 after PT Pamapersada Nusantara, posted a 14.33% increase in overburden removal and a slight decrease of 0.85% in coal production from 2010.
Delta Dunia's overburden in 2011 was 334.1 million bcm from 292.2 million bcm, while coal production reached 35.1 million tons from 34.8 million tons in 2010.
The overburden is slightly below the company's target of 340 million bcm-350 million bcm due to heavy rainfall in December 2011 compared to that in December 2010. "We calculated that rain hours rose 29% in December last year from a year ago."
The slight decrease in coal output was due to higher stripping ratio to 9.6 times from 8.3 times. Delta Dunia is 40% controlled by a consortium of Northstar Tambang Persada Ltd, which is backed up by TPG Capital, Government of Singapore Investment Corporation, and China Investment Corporation, and Northstar Equity Partners, founded by Patrick Walujo, former investment banker of Goldman Sachs.

Disclosure: No position at the stock mentioned above.

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