CEO Confident Sustainable Strategy Will Outlast Temporary Market Glut
Jakarta, July 31, 2013 - Holcim Indonesia, has published its first half unaudited financial results today. The Company will again pay a higher interim dividend to shareholders this year, a move which President Director; Eamon Ginley said is reflecting its confidence in a customer focused strategy, an expanding production footprint into East Java, and a positive view of the country’s growth prospects over the medium term.
Selected comparative highlights: Half Year Unaudited Results 2013
|Rp billion||Six months to June 30th 2013
|Six months to June 30th 2012
|Gross Profit Margin||35%||33%|
|Income from Operations||783||795|
President Director, Eamon Ginley confirmed an interim dividend of Rp 37 per share will be paid, representing a 15 per cent increase over last year’s interim dividend.
“With the announced interim dividend it is clear that Holcim continues to deliver results for shareholders, and we have a sound and sustainable strategy based on adding real value to our customers while maximizing efficiencies and boosting capacity to ensure this continues,” Ginley said.
Holcim Indonesia recorded an increase in sales revenues by 7 per cent to Rp 4.48 trillion. This was achieved through an optimised product and distribution mix against challenging market conditions on account of new capacities and expanding imports.
Net profit for the half year of Rp 467 billion was 7 per cent lower year on year. Higher distribution, selling and administrative costs, alongside higher finance costs have impacted earnings in the short term. However, the results for the first half included an improvement in gross profit margin from 33 per cent to 35 per cent, as the company’s programmes to improve energy efficiencies are proving their worth. Process improvements and energy savings initiatives, coupled with wider usage of low rank coal at lower prices have had a positive impact.
Market Conditions and Outlook
Eamon Ginley commented, “Currently Holcim Indonesia is operating in conditions of a market oversupply. However, this condition is temporary in the face of steadily increasing demand over the medium to long term as Indonesia’s economy continues to develop while Government and private sector investment in much-needed infrastructure and housing is pursued”.
He noted the Government’s fuel price hikes in June would also put pressure on the industry to adjust cement prices as transportation costs are increasing.
To manage changing market conditions, Ginley said, Holcim remained focused on a strategy to maximize revenues through continued excellence in products and service delivery via its distribution channels and partners, and through efficiencies in production, via recycling and the well-established use of alternative fuels and raw materials among others.
Ginley said that Holcim, as a premium brand, does compete solely on value, which was a competitive advantage over the longer term. “As a premium cement brand, at Holcim Indonesia we are focussed on delivering extra value to our customers. We are industry leaders in terms of innovation – such as in the Solusi Rumah franchise which has boosted home ownership and new opportunities for masons, retailers and developers. Specialized products like LiteCrete, FloCrete and Speedcrete help developers save money and create buildings/ road that are more energy and resource efficient and therefore sustainable,” Ginley said. .
Holcim’s new cement plant in Tuban, when complete will provide the company with an excellent cost-to-serve position in the main market of East Java, and the ability to ensure the best customer service and reliable supply, Ginley said.
“The first production line will provide 1.7 million tonnes per annum of cement, and is on track to start with the cement grinding operations in August this year”.
About PT Holcim Indonesia Tbk
PT Holcim Indonesia Tbk (Holcim Indonesia) is a publicly listed company which its majority stake (86.35%), is owned and managed by Swiss-based Holcim Group, one of the world’s largest cement companies with more than 85,000 employees and production capacity of more than 170 million tons of cement.
As one of the largest cement companies in Indonesia, PT Holcim Indonesia Tbk maintains integrated businesses of cement, ready-mix concrete, and aggregates production. The company operates three cement plants in Narogong-West Java, Cilacap-Central Java, Tuban 1-East Java and a grinding facility in Ciwandan-Banten with total capacity of 11 million tons of cement and employs more than 2,500 employees.
PT Holcim Indonesia Tbk operates a domestic building material supply network, which covers special distributors, retailers, masons, and Solusi Rumah outlets – the outlet provides housing design service, building materials, building consultation, and financing access. All under one roof.
Further information please contact:
|Rusli Setiawan||Diah Sasanawati (Anna)|
|Relationship Management Director||Corporate Communications Manager|
|PT Holcim Indonesia Tbk||PT Holcim Indonesia Tbk|
|Mobile: 0811 860375||Telepon: +62 21 29861000 ext 8361|
|Mobile: 0813 81818554|
|e-mail: email@example.com||e-mail: firstname.lastname@example.org|
|website: www.holcim.co.id||website: www.holcim.co.id|