Tuesday, 9 July 2013

PT. AKRA PROJECT OIL PRICE TO GROW BY 20 PERCENT IN 2013



PT AKR Corporindo Tbk [ARKA] set target for oil sales in 2013 to increase by 15% to 20% or equal to 2.47 million kiloliter till end of 2013. Meanwhile a sale of oil through 2012 was posted at 2.15 million KL.
               
AKRA was optimistic to be able to sell oil considering that the oil reserves possessed by BPH MIGAS sill remained 612 thousand KL.AKRA was optimistic that the demand for company’s oil was still strong in line with drilling activities in Kalimantan, Sulawesi and Papua. Moreover AKRA was to get extra supply a of certain type of oil.
               
The President of AKRA. Haryanto Adikoesoemo stated that today that the company was expanding distribution network by building reserve tanks in various locations in Java, Sumatra, Kalimantan and Sulawesi. The company’s allocated quota for 3013 for benzene and solar soil had increased to 880,850 kilo liter against the previous 267,892 liter.
               
While expanding distribution network for some regencies and cities in North Sumatra, Lampung, Greater Jakarta, Yogyakarta, South Kalimantan, East Kalimantan, Banten, West Java, East Java, Bali and South Sulawesi, “AKRA also made investment in oil tankers to meet increasing demand in some regions, so the volume would increase positively well” Haryanto remarked [3/6].
               
By Q 1-13, AKRA had succeeded in attainting sales volume of 507 thousand kl worth Rp4, 22 trillion. Meanwhile, sales income of oil in Q-1-12 was only posted at Rp4.05 trillion. As with sales of basic chemicals, AKRA managed to make Rp773 billion in Q1-13, an increase against sales in Q1-12 at below Rp747 billion.
               
Suresh Vembu, Director of AKR Corporindo stated that to increase income this year, AKRA was spurring on infra structure project aimed at supporting expansion of oil distribution. “Around 16 gas stations and fishermen’s gas stations would be put in operation” he said
               
The biggest income was contributed by oil trading and sales which came to Rp17.3 trillion or 79.8% of company’s total income, compared to realization of previous year of Rp14.9 trillion, oil distribution grew by 16%. “This year we are optimistic that income from oil would grow by up to 20%” Suresh said.
               
Last year, Suresh said, AKRA was able to distribute volume of non subsidy oil at 2.1 million kiloliter, most of which was absorbed by the industry segment. This year, AKRA was optimistic that sales would increase in line with the operation of four new terminals in Bitung, Samarinda, Palembang, and South Sulawesi.
               
As planned, the four terminals built by total investment of Rp500 billion would start to operate by quarter ll 2013 next. Today PT AKRA had built oil terminals or infra structures in 19 locations all over Indonesia including Medan, Palembang, Bandung, and Makassar. PT AKR had 140 oil storage tanks with total capacity of 549,000 kiloliter.

To Built Gas Stations
               
Meanwhile, to distribute subsidized oil based on public service obligations [PSO] of the government, this year AKRA planned to add another16 new gas station units which had been already operating since 2012. The investment for building a gas station was posted at Rp5 billion. “This year we will have 47 units of gas stations to smoothen pipelining of subsidized oil” Suresh was quoted as saying.
               
This year, AKRA had quota for pipelining of subsidized oil amounting to 267.892 ll or 160% against previous year at 103.000 kl. Besides, AKRA also had the opportunity to pipeline quota of subsidized oil reserves with total volume of 612,958 kl.
               
Suresh disclosed that over the period of January-March 2013, distribution of subsidized oil was still stable but was not increasing significantly because the number of gas stations in operations was still the same as last year i.e. 31 units. “In quarter two next, we project increase of volume” Suresh remarked without mentioning the volume of oil.
               
Head of Riset Bahana Securities Harry Su said that business in the industrial estate was attractive. However, AKRA’s income would not be felt until 2015. Instead he saw that in the short run the project would erode AKRA’s net profit.
               
According, to Harry, some part of income would be allocated for financing the project. By his calculation, this year AKRA’s income would increase by 12.3% to become Rp24.6 trillion against Rp21.9 trillion in 2012. However, net profit was only posted at Rp734 billion. “The profit was used for company expansion expenses” Harry said.
               
Harry estimated that the distribution volume of AKRA’s oil was still growing by 10% this year. However the volume was still far from the prediction of Bahana or even market consensus. The result was that Bahana’s income dropped against Harry’s target of Rp22, 34 trillion in 2012 and 2013.
               
Analyst of Kim Eng Securities. Adi Wicaksono wrote in this research that AKRA needed a new catalyst to increase income. Projects of the industrial estate could serve as positive catalyst as soon as operating. However in the short run, that AKRA could do was to increase 80 oil reserves stations this year as there was quota for oil distribution amounting to 600,000 kiloliter.
               
By Adi’s projection’s, AKRA’s net profit would still increase this year by 10% to the amount of Rp856 billion of the projected Rp771 billion in 2012. He also rated that AKRA’s bonds worth Rp1.5 trillion to be released this year would increase interest obligations of AKRA from Rp545 billion to Rp186 billion. (SS)  




Business News - June 07,2013

No comments: