Inline with increased demand, hence higher sales volumes, ANTAM’s unaudited revenue of 1Q11 rose 20% to Rp1.99 trillion compared to the same period of 2010. In 1Q11, sales volume of ferronickel jumped 33% to 2,209 TNi over the same period of last yeardue to higher demand. The ferronickel sales would have been higher if production in transit to ANTAM’s customers had arrived before the end of the quarter. On March 16, 2011, MV Sinar Kudus cargo vessel, owned and operated by PT Samudera Indonesia Tbk, was hijacked on the waters of Somalia. The cargo vessel carried the ANTAM’s ferronickel cargo destined to Europe. ANTAM had notified its European customers on the unfortunate incident. Although the incident resulted in delay of ferronickel shipment to Europe, the cargo was fully insured against the risk of loss and damage. Inline with 31% higher ferronickel price of US$12.32 per pound, ferronickel revenue rose 70% to Rp538 billion. During 1Q11, ferronickel production amounted to 4,836 TNi or a 10% higher over 1Q10 to meet the growing market demands. ANTAM’s ferronickel production during 1Q11 was 27% of annual production target of 18,000 TNi.
Inline with increased demand, sales of nickel ore increased 25% over 1Q10 to 1,626,806 wmt with production volume of 2,008,148 wmt. In 1Q10 ANTAM’s nickel ore production was 29% higher over 1Q10. In 1Q11 revenue from nickel ore amounted to Rp654 billion or 23% higher over the same period of last year.
As ANTAM ceased trading activities to reduce the risk of the volatility of gold price, gold sales volume was 16% lower in 1Q11, amounted to 1,730 kg. Gold production was 15% of annual target, reaching 588 kg. ANTAM’s gold production fell 14% compared to first quarter 2010 due to lower gold grades at Pongkor coupled with production at Cibaliung had not started at the planned gold vein. Despite lower sales volume, a 26% increase in gold price to US$ 1,411.24 per toz resulted in a slight increase in gold revenue by 1% to Rp698 billion.
Although ANTAM does not produce bauxite in 1Q11, sales volume from the Kijang inventory amounted to 130,218 wmt, generated Rp14 billion of revenue.
Inline with increased revenue, gross profit rose 32% to Rp626 billion compared to 1Q10. ANTAM’s gross margin during 1Q11 was 31% compared with 29% in 1Q10. ANTAM's cost of sales increased by 16% to Rp1.4 trillion, primarily driven by 26% increase in fuel cost to Rp284 billion and 47% increase in the cost of materials used to Rp148 billion. Higher fuel cost and materials used were due to increased production of ferronickel.
ANTAM’s operating profit rose 36% to Rp470 billion with operating margin of 24%, higher than 21% of operating margin in 1Q10. ANTAM’s income before tax rose sharply by 72% to Rp466 billion as ANTAM posted Rp106 billion other income. The additional income was largely due to recognition of ANTAM’s ferronickel final invoice from 2010 exports. ANTAM’s income tax expense amounted to Rp120 billion, a 70% higher compared to 1Q10 following higher incomes. Inline with cash and cash equivalents of Rp4 trillion and only Rp919 billion of investment loans, ANTAM’s net cash position remained strong to support its growth projects.
