ANTAM’s President Director, Alwin Syah Lubis said:
“Our significant jump in performance in the first half of 2010 reflects higher production and sales performance of our main commodity of nickel, as well as prices. We continue our efforts to lower costs through various efficiency measures and were able to save around Rp21.8 billion in the first half of 2010. We are certain 2010 is another year of solid return to our shareholders.“
Inline with an 80% increase of revenue to Rp2.9 trillion from ANTAM’s nickel segment which comprised of ferronickel and nickel ore, due to higher sales volume and prices, ANTAM’s first half of 2010 consolidated revenue of Rp4.3 trillion was only slightly lower over the same period of 2009. Decreased total sales value was due to lower precious metals trading activities which have low margins. ANTAM’s nickel segment was the biggest contributor to ANTAM’s sales in first half of 2010 with 68% contribution. ANTAM’s gold segment which comprised of revenue from gold, silver and precious metals refinery services, contributed 30% to ANTAM’s total first half 2010 revenue, amounted to Rp1.3 trillion. The 78% of ANTAM’s sales was generated from abroad with a value of Rp3.3 trillion.
Due to the optimal load of the FeNi III smelter following the optimisation program which was completed in September 2009, ferronickel production at Pomalaa rose 52% at the first half of 2010 over the same period of 2009 to 9,252 TNi. Ferronickel production during the first half of 2010 was 50% of annual production target of 18,500 TNi. Inline with higher production and demand, sales rose 38% over the same period of 2009 to 9,743 TNi and was 51% of 2010 target of 19,000 TNi. As the average selling price of ferronickel rose 70% to US$9.39/lb., revenue from ferronickel in the first half 2010 rose 98% to Rp1.8 trillion.
The volume of nickel ore production in the first half of 2010 rose by 20% to 3,393,336 wmt. Nickel ore sales in first half of 2010 was up 16% over the same period of 2009 to 2,721,497 wmt, and consisted of 1,832,256 wmt of high grade nickel ore, in which all came from Buli mine, and 889,241 wmt of low grade nickel ore. Production of nickel ore during the first half of 2010 was 55% of 2010 target of 6,150,000 wmt while sales volume was 51% of 2010 target of 5,350,000 wmt. The revenue benefits from nickel ore were higher due to increased ore prices, generated Rp1.1 trillion in revenue in first half 2010 or a 57% increase over first semester of 2009. Production at Pongkor in the first half of 2010 amounted to 1,382 kg, an increase of 2% over the same period of 2009. Pongkor production in first half of 2010 was 54% of annual target of 2,580 kg. As ANTAM begins to operate the new Cibaliung gold mine at the end of May, gold production at Cibaliung amounted to 30 kg with silver production of 120 kg in the first half of 2010. Inline with lower precious metals trading activities, ANTAM’s gold sales decreased by 54% to 3,403 kg. Management decided to limit gold trading activities inline with the gold price fluctuations which increased risks. Sales of gold in the first half of 2010 was 43% of 2010 target of 7,980 kg. During the first half of 2010, 56% of ANTAM’s gold sales came from trading revenue from gold decreased by 54% to Rp1.2 trillion.
ANTAM’s bauxite export of Rp23.3 billion in the first half of 2010 was a 23% decrease over the same period of 2009. Lower bauxite export was largely due to lower prices and a 7% decrease of bauxite sales volume of 136,911 wmt in the first half of 2010.
The cost of goods sold decreased 26% to Rp2.9 trillion. This was due to the decreased cost of precious metals purchases that fell 68% to Rp704 billion. Due to higher nickel ore production, ANTAM’s ore mining fees during the first half of 2010 increased by 5% to Rp470.5 billion. Fuel cost also rose by 62% to Rp464.7 billion due to higher ferronickel production. During the first half of 2010, ANTAM’s operating expenses rose 28% over the same period of 2009 to Rp317.8 billion. ANTAM’s freight and insurance costs rose 19% to Rp42.4 billion due to higher sales of nickel ore and ferronickel. ANTAM’s financial position remains solid and strong in the first half of 2010 as cash and cash equivalents grew 11% over the same period of 2009 to Rp3.2 trillion. ANTAM also posted higher trade receivables by 88% to Rp1.6 trillion. As well, total debt was lowered to US$38.25 million in the first half of 2010 compared to US$62.6 million in the first half of 2009. ANTAM’s financial strength was further evidenced with its interest bearing debt to equity ratio of 4%, urrent ratio of 5.45 times and working capital of Rp5 trillion. ANTAM is in the solid position to further support its investment plans in view of its strong financial structure. Net cash provided by operating activities jumped in the first half of 2010 by 116% to Rp841.7 billion due to lower payment to suppliers by 27% to Rp2.5 trillion inline with lower trading activities as well as higher receipts from tax restitution of Rp338 billion. As ANTAM posted a 77% lower of net cash used in financing activities of Rp117 billion, ANTAM’s cash and cash equivalents rose by 11% to Rp3.2 trillion.
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