Remaining Solid During Pandemic15 May 2020 11:27
ITM recorded net income despite global economic slowdown in the middle of pandemic.
The Covid-19 outbreak which occurred first at the end of 2019 has spread globally and has caused global economic slowdown and pressurized the already strained domestic and international trade due to the US and China trade war last year.
Apart from the impact that was caused by COVID-19 pandemic, some early signs of recoveries can be seen in countries across Asia in which the threat of pandemic has been lowered and economic activities started again after relaxation on social restriction imposed. This condition gives indication of recovering potential in economic terms going into second semester of 2020.
PT Indo Tambangraya Megah Tbk. recorded solid results despite impact from the global economic slowdown induced by pandemic with positive net profit during the first quarter of 2020.
The Company has focus on three main areas to ensure business and operation affected at minimum during this challenging condition. Firstly, the Company keeps its commitment to its employees physically and mentally. Secondly, the Company secures its business through careful planning and decisive implementation. Lastly, the Company maintains its support for the community with sustainable approach.
The Company also prepares its Business Continuity Plan to anticipate longer effect from pandemic. The Company has mapped issues that may arise due to the pandemic and prepared its appropriate response. This move was prepared in all aspects of the Company business which includes sales and logistic, mine operations, and finance and admin. The implementation of this plan is fully supported by our Health Safety and Environment (HSE) function.
During the first quarter of 2020, the Company booked a lower average selling coal price by 17% from USD 71.1 per ton to USD 58.7 per ton on year-on-year basis. The sharp drop in coal price was mainly due to lower coal demand which was induced by seasonal factor and further impacted by pandemic situation. As a result, net income during this period shrank by 63% to USD 14 million from USD 39 million during first quarter last year.
Such a significant decrease in average selling price also eroded the Company Total Revenue, from USD 453 million to USD 366 million while gross profit margin went down from 21% to 18% year-on-year.
EBIT was recorded at USD 36 million or 37% lower than the same period last year which was at USD 57 million. As for earnings per share, it was booked at USD 0.014.
By the end of March 2020, ITM’s total assets were valued at USD 1,239 million while total equity was USD 865 million. The Company has maintained a strong net cash position of USD 222 million with short term working capital borrowings of USD 1.9 million.
This year sales volume target is set at 22 million ton. In the first quarter of 2020, the Company sold 5.8 million tons of coal which was exported to China (1.6 million tons), Japan (1.5 million tons), Indonesia (0.7 million tons), Bangladesh (0.5 million tons), Thailand (0.4 million tons), India (0.3 million tons), Philippines (0.3 million tons) and other countries in East and Southeast Asia.
In line with the production target for this year, the Company produced 4.5 million tons of coal in this first quarter.Back to News