Displaying items by tag: Indonesia
Siam Cement Q3 net profit falls by 13%
24 October 2012Thailand: Siam Cement's third-quarter net profit has fallen by 13% to US$201m from US$240m. The conglomerate blamed higher expenses and the cost of sales.
For the quarter ending on 30 September 2012, sales increased by 11% to US$3.39bn from US$3.01bn. The cost of sales rose by 9.1% to US$2.89bn from US$2.65bn. Total expenses grew by 15% to US$305m from US$266m. Contributions from the cement unit rose by 33% to US$2.45bn.
Despite the profit decline, the conglomerate said that its board had approved plans to spend US$358m on a new cement plant in Indonesia and US$179m on an expansion of its cement business in Cambodia. Siam Cement has aggressively expanded its business in local and overseas markets over the past few years, particularly in members of the Association of Southeast Asian Nations, as it seeks to boost future income and diversify risk across markets.
Indonesian cement sales in September rise by record 34.4%
12 October 2012Indonesia: Cement sales in Indonesia have hit a record high of 5.16Mt in September 2012, according to data from the country's largest cement producer PT Semen Gresik. The amount represents a 34.4% rise compared to the same month in 2011 when sales were 3.84Mt.
September 2012 sales were boosted by increased monthly sales on the main islands of Java and Sumatra. However sales on the island of Moluccas and Papua fell by 21.7% on a monthly basis. The strong September 2012 sales follow a dip in sales in August 2012 due to fewer working days during religious festivities. Domestic cement sales in Indonesia fluctuate with factors such as holidays and government project completion deadlines.
"We expect domestic volume growth of 12.6% in 2012 and 10.8% in 2013, helped by strong marketing sales," commented Teguh Hartanto, an analyst for Bahana Securities in Jakarta.
Chinese projects gain Indonesian approval
03 October 2012Indonesia: Chinese producers are expected to increase their capacity in Indonesia to 65Mt/yr from 60.56Mt/yr, according to an Indonesian industry official.
"Production will increase by 7% because the capacity of the factories will be ramped up and there will be additional investment in the cement business as well," said Director General for Basic Manufacturing Industry, Panggah Susanto. The plans for investment have been approved by the Capital Investment Coordinating Board (BKPM).
Chinese producer Anhui Conch Cement Co Ltd has said that it will will build a 10Mt/yr plant in either South Kalimantan, East Kalimantan, West Kalimantan or West Papua.
China Trio Bit Engineering Co Ltd will build a 1.5Mt/yr plant in Subang, West Java. Another Chinese firm, State Development and Investment Corperation (SDIC), will build a 1.8Mt/yr plant in Papua. In addition, Siam Cement, the largest cement producer in Thailand, has also expressed interest in building a 1.8Mt.yr plant in West Java.
Semen Gresik plans expansion in Vietnam
29 June 2012Indonesia: PT Semen Gresik, Indonesia's largest cement producer, plans to spend US$400m-US$500m to expand its operation into Vietnam and Myanmar by the end of 2012, according to its general director Dwi Soetjipto.
Semen Gresik intends to finance 20% of the expansion with internal cash and the remainder with external sources, possibly from a global bonds issue. In case any negotiations conclude by the end of 2012, Semen Gresik would likely issue bonds in 2013, Dwi added.
The company has been assessing potential local partners for a joint venture for a plant in Myanmar to produce around 600,000t/yr, in which Semen Gresik will contribute US$150m. However, Dwi Soetjipto declined to discuss Vietnamese expansion plans in detail, hinting at an acquisition.
Semen Gresik reported total assets of US$2.25bn at the end of March 2012. The firm's revenues in the first quarter of 2012, rose by 20% year-on-year to US$458m. Its cement sales fell at 4.94Mt in Jan-Mar period, making up 39.3% of Indonesia's market share. Semen Gresik predicts that its cement sales will reach 22.5Mt/yr in 2012, up from 19.72Mt/yr in 2011. Revenues are expected to rise 15% year-on-year to US$1.93bn.
Indonesia – How high can you go?
18 April 2012Indonesia: It seems that not a week goes past without a forecast, announcement or other report about the continued boom in the Indonesian cement industry. Similarly, there is a steady stream of expansion announcements to accommodate the future demand. In light of another round of impressive cement statistics, what's the story for Indonesia in 2012 and beyond?
In the three months to 31 March 2012 Indonesia produced 12.5Mt of cement, an 18% rise on the first quarter of 2011. In the whole of that year, the cement industry turned out a massive 17% more cement than in 2010. These headline increases are certainly impressive and show that if the first quarter of 2012 was repeated three more times throughout the rest of the year, Indonesia would hit its 53Mt production forecast. This is more than double the cement production of 1998 (22Mt/yr in the midst of the Asian banking crisis) and, while from a low base, the values represent incredible sustained year-on-year demand growth.
But what is the potential of the Indonesian cement industry? This can be assessed by looking one of Indonesia's neighbours, namely Malaysia, and doing a quick thought-experiment. What would the Indonesian cement industry look like if the country were to suddenly develop demands and cement consumption patterns like Malaysia does today? Indonesia has a population 8.3 times higher than Malaysia1 and a cement consumption/capita rate approximately 2.4 times lower.2 Assuming current Indonesian cement consumption to be 50Mt, if all of the people in Indonesia were to suddenly start using cement like Malaysia does today, the country's cement industry would have to be nearly 1000Mt/yr to support demand!
While this is clearly not the case today and is unlikely to be fully realised, Indonesia will continue to develop economically. As it does, the world's fourth most populous nation will need more cement. How much is open to debate, but even if a small percentage of that hypothetical 1000Mt can be realised, it will certainly justify the current rush to add extra capacity. This is now especially likely in light of the December 2011 relaxation of land acquisition rules, which will make it easier to build both cement projects and the large construction projects that need cement.
Click here for much more on the cement industries of Indonesia and Malaysia (as well as Vietnam) from the April 2012 issue of Global Cement Magazine.
1. CIA World Factbook website, https://www.cia.gov/library/publications/the-world-factbook.
2. Cement consumption per capita data for Malaysia taken from Lafarge 2010 Annual Report. (http://www.lafarge.com/04112011-customers_activities-cement_market_2010-uk.pdf). Malaysia is a representative comparison for Indonesia based on its GDP to cement consumption ratio.
Indonesia's sales grow 18.2% in Q1
18 April 2012Indonesia: Indonesia's domestic cement sales were 12.5Mt in the first quarter of 2012, up 18.2% year-on-year compared to the same period in 2011, according to data from cement firm PT Semen Gresik. March 2012 sales were 4.4Mt, a rise of 16.2% year-on-year, the data showed, with most sales on the islands of Sumatra and Java.
"Indonesia's low cement consumption of around 199kg/capita in 2011 continues to provide ample room for growth," said Teguh Hartanto, analyst at Bahana Securities in Jakarta.
PT Indocement Tunggal Perkasa Tbk, Indonesia's biggest cement firm by market value, has estimated that national demand for cement will grow by 8-10% as infrastructure projects increase after a government law in December 2011 speeds up land acquisition. The country's cement sales fluctuate month to month depending on factors such as holidays and the government's end-of-year project completion deadlines.
Indocement to hit 30Mt/yr by 2017
28 March 2012Indonesia: Indonesia's second-largest cement producer, PT Indocement ,has announced that its recent expansion drive will increase production to up to 30Mt/yr by 2017, up by almost 50% from the 2012 target of 20.6Mt/yr.
One of these projects is the construction of a cement mill in Citeureup, West Java, with an expected production capacity of 1.9Mt/yr. The mill is scheduled for completion in 2013.
Besides the new cement mill, the company is in the final planning stage of constructing a cement factory with a capacity of 4.4Mt/yr at an existing location (brownfield), also in Citeureup. Additionally the company is conducting final studies for the construction of two new cement factories (greenfield) in Central Java and outside Java, each of which will have capacities of up to 2.5Mt/yr.
Finance director Tju Lie Sukanto said the company would fund the expansion projects partly with US$757m of internal cash. He added that this year's market conditions, such as the continuing strong residential-market trends, thanks to an expanding middle class, would further facilitate the company in reaching its growth targets.
Indocement Q4 net profit rises 20%
28 March 2012Indonesia: PT Indocement, Indonesia's second largest cement producer, has announced that its fourth-quarter 2011 net profit rose 20% as demand for construction jumped in Southeast Asia's biggest economy. The firm's fourth quarter net profit was US$109m in 2011, compared with US$91m in the same period in 2010.
The HeidelbergCement subsidiary reported a full year 2011 net profit of US$392m, up by 12% from US$351m in 2010. Analysts forecast that the full-year 2011 net profit will rise by 11% to US$391m. Indocement's 2010 full-year net revenue rose by 25% to US$1.5bn.
Anhui Conch plans US$400m plant for South Kalimantan
15 March 2012Indonesia: Chinese cement giant Anhui Conch Cement plans to begin construction of a plant in South Kalimantan later in 2012, with an anticipated investment of US$400m.
"The planned plant in South Kalimantan will be able to produce 2.5Mt/yr," announced Industry Minister MS Hidayat as he met with a business delegation from China's Anhui province at the ministry's office. The output will be used for domestic purposes.
Anhui Conch Cement is currently awaiting the completion of its land acquisition process and a license to be issued by the South Kalimantan administration so that the plant can be built in Tanjung, Tabalong. The plant will be equipped with a cement-grinding plant, a seaport, a 60MW power plant and other supporting infrastructure.
Hidayat added that Anhui Conch Cement is also preparing to acquire land in Manokwari, West Papua, in 2013 for another cement plant that would require US$400m. It is expected to meet cement demands in the surrounding areas.
Indonesia's domestic sales grow 24% in February 2012
14 March 2012Indonesia: Indonesia's domestic cement sales grew strongly in February 2012, up by 23.9% year-on-year, according to data from the country's largest cement firm PT Semen Gresik. Sales for the month reached 4.1Mt, slightly higher than January 2012's 4.06Mt.
"Low 2011 loan to GDP ratio at around 30% combined with low interest rates should allow credit to continue growing, paving the way for economic growth," said Teguh Hartanto, deputy head of research at Jakarta-based Bahana Securities. The country's cement sales fluctuate from month to month depending on a variety of factors, including religious holidays, which can delay construction, and the government's end-of-year project completion deadlines.