Jakarta, 31 March 2008 (ANTARA) - PT Timah (Persero) Tbk reported today its Consolidated Financial Statement for the year ended 31 December 2007. The company posted 2007 net profit of Rp1.78 Trillion (Rp 1,784.6 billion) or Rp3,546,- per share, which was 757% higher compared to that of 2006 net profit of Rp208.1 billion or Rp414,- per share. Higher net profit was due to better performance of the Company as well as higher global tin price that was supported by more favorable situation on the national tin industry.
Law enforcement on the tin mining activity has contributed significantly to the more favorable situation of the Indonesian tin industry. This was followed by the Government's action through the issuance of Trade Minister Decree No. 4 of 2007, which creates a more conducive environment to the mining activities. Furthermore, "harmonization" program initiated by the company to enhance common awareness of the benefit of tin resources between the company and the local community at large during the year has resulted in improved performance of the company as well as better community welfare being nurtured by the company.
In addition, better control of tin export has affected the global tin price level. During 2007, the highest level of world's tin price was recorded at US$17,300 per metric ton, and the lowest at US$10,175 per metric ton, with the average annual price recorded at US$14,529 per metric ton, an increase of 166% from 2006 average price of US$8,763 per metric ton. PT Timah (Persero) Tbk contributed 18% of the world supply of refined tin with total production of 58,325 metric ton in 2007.
Operational Highlight
The company's revenue in 2007 reached Rp8,542.4 billion, or 110% higher than 2006 revenue of Rp4,076.4 billion. The largest contributor of the company's consolidated revenue came from the sales of refined tin which was 91.15%, while the sales of coal contributes 8.6%. Revenue from sale of refined tin increased 225.7% from Rp3,450.3 billion in 2006 to Rp7,786.2 billion. The significant increase was due to the increased in sales volume sold and higher average tin price received by the company. Sales volume of refined tin was 38% from 42,613 metric ton in 2006 to 58,927 metr ic ton in 2007.
The average tin price received by the company in 2007 reached US$14,474 per metric ton, which was 64% higher than that of 2006 average of US$ 8,844 per metric ton. Meanwhile, the exchange rate of US Dollar to the Indonesian Rupiah in 2007 was relatively stable compared to that in 2006. The exchange rate of US Dollar in 2006 was Rp9,166 and in 2007 was Rp9,129 per US dollar.
Refined tin production in 2007 was 58,325 metric ton, which was 31% higher compared to 2006 of 44,689 metric ton.
In addition to the increased in smelter capacity, higher refined tin production in 2007 was also due to higher availability of tin-in-concentrate. Total tin-in-concentrate production in 2007 was 58,086 metric ton, or 12% higher than that in 2006 of 51,847 metric ton. Higher production of refined tin has also resulted in decreased tin-in-concentrate inventory level by 56%, from 13,325 metric ton at end of 2006 to only 5,919 metric ton at end of 2007.
The largest contributor of tin-in-concentrate production came from inland mining, which produced 46,078 metric ton Sn, an 18% increase compared to that of 2006 production of 39,141 metric ton Sn. This was due to continuous law enforcement measures in the tin mining activities, as well as the result of more effective security effort in the company's mining rights areas, and thus securing better supply of tin-in-concentrate from the land mines. Production from offshore, however, experienced 5% decrease from 12,706 metric ton in 2006, down to 12,008 metric ton in 2007. Bad sea weather along 2007 and temporary stoppage in operation due to maintenance of dredges have caused such decrease.
The increase production of refined tin utilizing the tin-in-concentrate produced during the year as well as beginning year inventory has also resulted to the increase of tin-slag (work in process) volume by 54%, from 10,925 metric ton at the end of 2006 to 16,866 metric ton at the end of 2007.
Coal business unit remained providing significant contribution to the company. Coal sourcing from both PT Tanjung Alam Jaya as well as its business partners has increased by 0.9% from 2,145,254 metric ton in 2006 to 2,164,885 metric ton in 2007. Whereas the sales volume increased by 36% from 1,784,305 metric ton in 2006 up to 2,430,836 metric ton in 2007.
Financial Highlight
The company's gross profit in 2007 reached Rp3,176 billion or 3.8 times higher than that of 2006 of Rp665.1 billion. This was due to higher refined tin cost of goods sold of 57%, while cost of goods sold of consolidated subsidiaries increased by 25% compared to that of the previous year.
The company's operating profit increased by 6.2 times, from Rp381.2 billion in 2006 to Rp2,723.6 billion, and profit before tax was 6.6 times higher compared to that of 2006 of Rp347.5 billion to Rp 2,653.9 billion.
The company's total asset increased by 45% from Rp3,462.2 billion to Rp5,032.7 billion. The increase was mainly due to the increase in current asset by 76% from Rp2,227.1 billion in 2006 to Rp3,922.1 billion in 2007. The largest contributor came from the increase of cash and cash equivalents of 873% from Rp178.2 billion at the end of 2006 to Rp1,734.2 billion at the end of 2007. The company's receivables increased by 44% from Rp 221.1 billion at the end of 2006 up to Rp318.1 billion at the end of 2007.
In 2007, the company decided to repay all of its short term debt, which as of the end of 2006 the company's short term debts amounted to Rp692.4 billion. Trade payable also decreased by 44%, from Rp341.8 billion at the end of 2006 to Rp190.5 billion at the end of 2007. Total equity increased 100% to Rp 3,359 bi llion in 2007 compared to Rp1,676.6 billion in 2006.
Current situation and future outlook
World's demand on refined tin is still showing a high growth rate. Commodity Research Unit (CRU), a London-based independent research institution, estimated that the world's consumption in 2008 will reach 375,000 metric ton, or 2.9% increase from 2007's consumption of 364,000 metric ton. On February 2008, CRU estimated that the tin metal production in 2008 will reach 361,000 metric ton, or 3.9% increase from 2007 of 347,000 metric ton. Thus, it is estimated that there will be supply deficit of 14,300 metric ton in 2008.
The company believes that the tin mining industry is still promising. The company believes that the current condition -- whereby the law is being enforced -- as a process towards a better tin mining industry climate. The company expects that the Government will continuously and consistently implement such enforcement from time to time, so that utilization of national tin resources will produce an optimum value addition to overall national economy, create a healthy and fair business climate, and nurture a competitive and responsible tin mining industry socially and environmentally.
The existence of local or small scale mining becomes a part of overall mining industry. Unorganized local mining, however, will become a future economic hindrance due to its adverse environmental impact. Thus the company takes the effort to accomodate such small scale mining through partnership, while keeping on implementing good mining practice, environmentally responsible practice as well as observing the highest standard of health and safety. The Company believe that support from all stakeholders to establish such efforts is very important.
The transitional period basically will provide a profitable opportunities to all parties by keeping the national tin's industry competitiveness in the global market. By engaging the co-operation of all parties, the company believes that the tin industry will still be prospective. The role of Indonesia in global tin market is very important especially during the transition period, which is also being supported by the increase world's demand of tin metal. In the mean time, the company has been and will be continuously implementing order and legal enforcement to mining activities conducted within the company's mining rights areas in improving the security of its mining areas by establishing extensive security posts. In addition, the company continues to invest in exploration activities to discover new resources, to improve efficiency, to develop high-value-added products, and to diversify into non-tin businesses within the company's competence in order to maintain its longterm business sustainability.
For further information, please contact :
Abrun Abubakar, Corporate Secretary
or
Rosmainita Sari, Investor Relation
Tel. : +62 21 344 4011 /
+62 21 344 4001
Fax. : +62 21 344 4012
E-mail : InvestorRelation@pttimah.co.id
Website : www.timah.com
COPYRIGHT © 2008 -ANTARANEWS
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