JAKARTA (TheInsiderStories) - PT Aneka Tambang Tbk (IDX:ANTM), a state controlled gold and nickel miner, has set capital expenditure of $150 million, which will mainly used to fund its three ongoing projects, namely SGA Menpawah, Halmahera nickel project and Anode Slime.
The company’s President Director Tedy Badrujaman said that Antam will also collaborate with giant copper and gold producer PT Freeport Indonesia and PT Smelting Gresik to build Anode Slime and Preciuos Metal Refinery. To realize the plan, Antam will set up JV in fourth quarter this year. Antam, he said, expects hold 30-40 percent shares in the JV firm.
In 2015, the company produced 2.2 tons of gold and traded 12.09 tons of the precious metal.
In addition, the company mulls a plan to explore gold mining potentials in Myanmar and nickel in Philippines.
“The most rapid to push our revenues are sales of raw materials and we try to find out mines in other countries which allows us to sell raw materials as in Indonesia banned,” Tedy said.
When asked about the progress of plan to acquire Freeport shares, Teddy said Antam is still waiting for the government’s decision. “There has been direction from the government to set up consortium with Inalum (Antam-Inalum consortium) or other mining state owned companies (to acquire the Freeport stakes),” Tedy said. The company and potential consortium partners are now preparing the financing schemes.
PT Freeport Indonesia is obliged to further divest 10.64 percent shares of the company to Indonesia. Freeport has earlier set the price for the stakes at US$1.7 billion.
Financial Results
In 2015, the company recorded a 12 percent increase in sales compared to 2014 (FY14) to Rp10.5 trillion ($789.47 million), where gold was the largest component of Antam’s revenue, contributing Rp7.31 trillion or 70 percent of net sales. Ferronickel was the second largest contributor to Antam’s revenue, contributing Rp2.72 trillion or 26 percent of net sales.
Coupled with continued efficiency initiatives, our gross profit remains positive in FY15. Antam also recorded Rp2.33 trillion of increase on land from revaluation.
Antam’s increase of sales was a result of a significant increase in gold sales volume. Antam posted a 42 percent yoy increase of gold sales to 14,179 kg (455,865 oz). In FY15 Antam posted other comprehensive income of Rp912.56 billion after deducting the increase on land from revaluation with the operational performance of Rp1.44 trillion.
In FY15 Antam spent Rp2.02 trillion for capital expenditure consisting of Rp226.43 billion for routine capital expenditure, Rp1.75 trillion for development capital expenditure and Rp42.33 billion for deferred charges. Amidst volatility of commodity prices, ANTAM implements prudent investment spending.
Antam recorded a positive operating performance in 2015. Gold production in 2015 reached 2,210 kg (71,053 oz) from the Pongkor and Cibaliung mines compared to 2014 production of 2,342 kg (75,297 oz). Antam’s gold sales in FY15 surged by 42% to 14,179 kg (455,865 oz) compared to FY14. In addition to gold production from Pongkor and Cibaliung, Antam also refines gold for domestic third parties.
Ferronickel production in FY15 grew by 2% to 17,211 tons of contained nickel in ferronickel (TNi) compared to FY14. The increase was due to higher quantity and grade of the ore feed, which were mined from the Pomalaa and Pakal Island nickel mines. Sales volume of ferronickel in FY15 remained high despite volatility of global mining industry and was recorded at 18,643 TNi.
Antam continued its development initiatives prudently. The overall progress of Antam’s key projects was on track with the Engineering, Procurement and Construction (EPC) progress of the Pomalaa Ferronickel Plant Expansion Project (P3FP) reached 98.67 percent. Antam was reviewing the redesign as well as retendering its East Halmahera Ferronickel Plant Development Project (P3FH) after the Company received state injection at the end of 2015.
In other development initiatives, Antam and Antam signed a Memorandum of Understanding with Aluminum Corporation of China to develop and operate a Smelter Grade Alumina Refinery (SGAR). The production capacity of SGAR is estimated at 2 million tons of SGA per year which will be developed in stages. The refinery require 6 million wet metric tons (wmt) per year of ore feed. The capacity of the first stage of the SGAR is estimated at 1 million tons of SGA per year with the construction of the additional capacity of 1 million tons of SGA will commence when the operations of the first phase of the plant is positive. (*)