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AKRA posts 28% increase in net profit

AKRA posts 28% increase in net profit

JAKARTA: Major logistics company PT AKR Corporindo (AKRA) posted over Rp 1.03 trillion in net profit in 2015, up 28 percent from the previous year despite tough business condition.

The company also reported significant improvements across all business segments with a gross margin of 11,21 percent, operating margin of 6.83 percent and net margin of 5,23 percent in 2015.

Its consolidated gross revenue declined to Rp 19.76 trillion in 2015 from Rp 22.46 trillion a year earlier due to low oil prices, according to the company’s financial statements.

The strong profits reported during 2015 year demonstrates the company’s ability to maintain its growth momentum despite the significant decline in petroleum prices and slowing demand from industries in Indonesia.

The business performance was due to the company’s ability to deliver effective supply chain solutions while maintaining a strong focus on risk management and cost control.

“Continuing from strong performance in the previous year, it’s my privilege to announce that in 2015 AKRA continues to produce solid financial results evidenced by 28 percent growth in net income year-on-year,” president director Haryanto Adikoesoemo said.

“Our strategy to maximize profits while maintaining margins through strong cost controls have enabled us to meet our earnings target.”

Haryanto added the company will use its extensive infrastructure network to capitalize the opportunity from the low oil price by expanding the distribution of petroleum and raw materials.

“One of the key initiatives we have embarked this year is the introduction of RON92 product which we will distribute through our existing and new retail outlets,” he said.

Regarding the development of the Java integrated industrial and port estate (JIIPE) in Gresik, East Java, Haryanto said the development of infrastructure and preparation for industrial plots have shown significant progress.

Construction of industrial plants at the site has commenced and the port operations in first stage of 85 ha and 500 meters jetty has commenced since January 2016, he said.

“We are now finalizing the first power plants and other utilities which will enable us to offer integrated industrial estate with low cost logistics and energy solutions to our industrial estate tenants,” he added.

The company whose business is providing logistic services and supply chain solutions for bulk chemicals and energy distribution was confident about high demand for basi raw material, petroleum products and industrial estates in 2016.

The confidence was supported by the country’s GDP growth from 4.9 percent in 2015 to 5.4 percent this year as estimated by Asian Development Bank.

Several economic packages issued by the government including deregulation in downstream petroleum segment is expected to increase demand for unsubsidized fuels in industrial and retail segments which will eventually help AKRA to increase its volumes and maintain growth in its earnings.

In addition, the company continues to maintain a strong balance sheet as of Dec. 31, 2015 with adequate liquidity and low leverage evidenced by a 44 percent increase in its cash position to Rp 1.29 trillion compared to Rp 897 billion during the previous year.

The company’s total assets stood at Rp 15,203 billion as of Dec. 31, 2015 with total liabilities of Rp 7.91 trillion.

In terms of capital expenditures, AKRA continues to expand its network of tank terminals and infrastructure by investing Rp 272 billion in 2015, compared to Rp 578 billion in the previous year.