JAKARTA (TheInsiderStories) – PT Bumi Resources Tbk (IDX:BUMI), the country’s largest coal producer, said it expects to book net profit of USD101.6 million in 2016, after recording a whopping net loss of USD2 billion in 2015, thanks to higher coal price in second half of the year.
In 2016, the company recorded combined coal sales rise to 87.7 million tons (+10.6% increase) compared with 79.3 million tons in FY 2015. The coal mined increased by 6.5% to 86.5 million tons last year compared with 81.2 million tons previous year.
Arutmin sales increased by 15.3% to 28.6 million tons in FY 2016 compared with 24.8 million tons in FY 2015. KPC, likewise, increased sales by 8.4% to 59.1 million tons in FY 2016 compared with 54.6 million tons in FY 2015, the company said.
The company expects a “very promising” prospect for 2017 fiscal year.
Quarterly results
It said the combined coal sales increased by 10.2% to 23.1 million tons in Q4 2016 compared with 20.9 million tons in Q4 2015.
Arutmin sales increased by 35.5% to 8.4 million tons in the fourth quarter compared with 6.2 million tons in Q4 2015.
KPC Sales were steady at 14.7 million tons in the fourth quarter.
The coal mined rose by 12.3% to 23.8 million tons in the fourth quarter compared with 21.2 million tons in Q4 2016.
Arutmin increased coal that were mined by 37.2% to 9.0 million tons in Q4 2016 compared with 6.5 million tons in Q4 2015. KPC increased coal that was mined by 1.2% to 14.9 million tons in the fourth quarter compared with 14.7 million tons in Q4 2015.
Bumi said the combined Strip Ratio was reduced by 3.7% to 6.9 in FY 2016 compared with 7.1 in FY 2015 due to a reduction by 4.1% in KPC. Meanwhile, the average price realized in FY 2016 was $42.1/ton compared with $44.8/ton in previous year or a reduction by 6.0% - due to market conditions and execution of previous contracts.
However, the ASP shows an upward trend in Q4 2016 to $47.7/ton compared with $42.1/ton in Q4 2015 and $40.5/ton in Q3 2016.
Outlook for 2017
The company is optimistic about the coal price in 2017 and benchmark Coal Price presently is around $80 per ton. The company expects to exceed production between 5% - 7% and its coal average selling price at least 30% above FY 2016 levels.
It said 60% of sales volume is already committed and this is expected to rise to 75% at end of Q1 2017 with finalization of annual contracts with Japan.
Net Income prospects are bright, it said. Its sales are expected to be 5% - 7% higher than FY 2016, while the coal price is expected to be higher by at least 30% compared to 2016.
It also expects an improved efficiency and economies of scale. Apart from coal subsidiaries, Bumi also expects equity contributions from its other investments such as Darma Henwa where the company holds a 31% stake, Pendopo and possibly Bumi Resources Minerals (BRMS). (*)