Antam to rise stakes in subsidiaries for profits

The Jakarta Post | Business | Wed, March 20 2013, 1:22 PM

Publicly-listed diversified mining company PT Aneka Tambang (Antam) is seeking opportunities to increase its ownership in some of its subsidiaries after realizing that the companies generated more profits last year.

“We have several subsidiaries and are evaluating which companies we can increase stakes in,” Antam corporate secretary Tedy Badrujaman said.

He declined to reveal which subsidiaries the company was looking at.

Antam booked Rp 2.48 trillion (US$255 million) in its fair value adjustment last year. The company attributed the gain to its increased stake in PT Nusa Halmahera Minerals to 25 percent from a previous level of 17.5 percent.

Antam signed a deal last year to purchase a 7.5 percent stake in Nusa Halmahera Minerals, which is the contract holder for work in the Gosowong gold mine in North Maluku, from Newcrest Mining Limited in a deal worth US$130 million.

Antam will pay another $30 million if the mining site is found to have an additional million ounces of gold resources by December 2017.

“Increasing a stake in Nusa Halmahera Minerals is part of Antam’s management strategy to increase the contribution from its gold portfolio, which has a solid position in the commodity market,” Tedy said.

The increasing stake in Nusa Halmahera Minerals contributed Rp 375 billion in dividends in 2012, according to Tedy.

The gain from the adjustment of investment in Nusa Halmahera Minerals offset the company’s flat growth in its revenue of 1 percent to Rp 10.45 trillion.

It was also able to push net profits to Rp 2.99 trillion, a 55 percent increase compared to Rp 1.93 trillion in 2011.

Antam has a number of majority owned subsidiaries. According to its financial report of December 2012, the company also has investments in a number of companies, including sponge iron manufacturer PT Meratus Jaya Iron & Steel (34 percent), diversified unit PT Menara Antam Sejahtera (25 percent) and alumina firm PT Indonesia Chemical Alumina.

Antam has built joint ventures for free, in which the company has an ownership interest in the entities without making any cash contributions.

The joint ventures are PT Sorikmas Mining (25 percent), PT Galuh Cempaka (20 percent), PT Dairi Prima Minerals (20 percent), PT Gorontalo Minerals (20 percent), PT Sumbawa Timur Mining (20 percent), PT Pelsart Tambang Kencana (15 percent) and PT Weda Bay Nickel (10 percent).

Antam is expecting sales of gold to remain the main contributor to the company.

Gold production is expected to touch 3,316 kilograms this year, up by around 16 percent compared to 2, 849 kilograms last year.

Meanwhile, gold sales are targeted to be at 7,601 kilograms this year, increasing by around 8 percent from 7,024 kilograms last year.

Income from gold sales contributed around 38 percent to the company’s total revenue last year, followed by sales of ferronickel (30 percent) and nickel ore (29 percent). The company also sells other mining products, such as silver, coal and bauxite.

Antam said it would launch a new product this year, which is chemical grade alumina, following the completion of its chemical grade alumina plant (CGA Plant) in Tayan, West Kalimantan.


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