JAKARTA (TheInsiderStories) – Indonesia’ construction services firm PT Waskita Beton Precast Tbk (IDX: WSBP), plans to issue bonds of Rp1.5 trillion (US$105.63 million) in the fourth quarter of 2019. The bonds are part of a total bond of Rp2 trillion, said the management on Tuesday (8/20).
Company’ Corporate Secretary Fathia Syafurah said the subsidiary of state-owned contractor developer PT Waskita Karya Tbk (IDX: WSKT) had issued Rp500 billion of the total Rp2 trillion issuance. Syafurah explained the funds from the bond issuance will be used for working capital of Rp500 billion. While the rest will be used for refinancing.
The investment of Rp500 billion will be used to prepare a factory in Penajam Paser Utara, East Kalimantan. This plant was built to absorb market in the central and eastern regions of Indonesia, even regional markets in Southeast Asia. The Plant in Penajam will have a production capacity of 250 thousand tons/year and produce Box Girder, PCT Girder, Square Pile, and CCSP.
The company will also use the plant for supporting facilities in the form of production area, workshop area, and waste treatment area. Waskita Beton plans to expand by having its own jetty to facilitate access to shipping precast products directly from the plant to other islands because it has a strategic location with Balikpapan Bay.
As of July 2019, Waskita Beton received a new contract of Rp3.29 trillion or around 31.7 percent of the target value of the new 2019 contract. The company also maintains synergy with the Waskita Group for business development projects such as electric power poles, 1067 railroad bearings, Building precast, and façades; and initiating cooperation with global companies operating in Indonesia.
Three months ago, the company has issued a bond amounting to Rp500 billion with a three-year tenor. The total offering amounts to Rp2 trillion. The underwriters in the issuance are PT Danareksa Sekuritas, PT Bahana Sekuritas, PT Mandiri Sekuritas, PT BNI Sekuritas, PT Indopremier Sekuritas, and PT CGS-CIMB Sekuritas Indonesia.
The company said the bond issuance aims to support the company’s capital expenditure of Rp900 billion in 2019. WSBP has also budgeted working capital of Rp6 trillion to Rp7 trillion to pursue this year’s revenue target of Rp10 trillion and net profit of Rp1.31 trillion.
Meanwhile, at the end of 2018, WSBP had received payment of Rp 1.8 trillion for the Krian-Legundi-Bunder-Manyar toll road project and other projects. This year, the company is optimistic can achieve the target because infrastructure projects are still rife.
The government has prepared an infrastructure budget of Rp415 trillion to support connectivity, housing provision, and food security. The targets for infrastructure development include the construction of 1,837 kilometers of roads and 37,177 meters of bridges and 16 toll road projects.
This budget is also to continue the construction of a dam of 48 units. Then the railway line will cover 394.8 km, complete new airports in four locations, and build an irrigation network of 170.4 thousand hectares.
Last year, WSBP’s production capacity reached 3.5 million tons, an increase of 7.7 percent compared to 2017 which was 3.25 million tons. At present, WSBP has 11 plants spread across a number of regions, namely Cibitung, Palembang, Karawang, Subang, Sadang, Sidoarjo, Kalijati, Bojonegara, Klaten, Gasing, and Legundi. The company also has 72 batching plants.
Last year, the value of the new WSBP contract reached Rp6.66 trillion. The total contracts managed (order book) worth Rp17.34 trillion, including carry-over contracts in 2017 amounting to Rp10.68 trillion.
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