PT Aneka Tambang Tbk : ANTAM Financial & Operational Performance Remains Solid During The First Six Month Period of 2022
Jakarta, 2 September 2022 – PT Aneka Tambang Tbk (ANTAM; IDX: ANTM; ASX: ATM) member of Mining Industry Indonesia (MIND ID) – the State-Owned Enterprise Holding of the Mining Industry, is pleased to announce the Company’s financial and operational performance are remains solid during the first six month period of 2022 (January – June 2022, 1H22). The Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) level in 1H22 was recorded at Rp3.74 trillion, an increase of 50% from the previous EBITDA during the first six month period of 2021 (January – June 2021, 1H21) of Rp2.49 trillion. The Company’s performance during the second quarter of 2022 (April – June 2022, 2Q22) was influenced by the global economic volatility and geopolitical tension as well as the COVID-19 pandemic approached in East Asia. A series of conditions that affect the significant fluctuation of base metal price (nickel), energy cost (oil fuel and coal), and also the nickel product absorption in both domestic and export markets.
In the midst of recent development conditions, ANTAM focuses on the implementation of strategic policies to meet an appropriate cost efficiency approach, while maintaining the stability of production level and aims to expand the market shares of base and precious metal products in line with the improvement of global economic condition and the positive outlooks of base and precious metal absorption in 2022.
During the 1H22 period, ANTAM revenue was marked at Rp18.77 trillion, or a 9% increase from the 1H21 sales revenue of Rp17.28 trillion. In the midst of the upward trend of fuel price, raw material cost, and mining transportation & shipment fees, ANTAM gross profit in 1H22 amounted to Rp4.03 trillion, a 27% increase year over year (YoY) compared to 1H21 achievement of Rp3.17 trillion. ANTAM operating profit in 1H22 amounted to Rp1.46 trillion with total other income, net attributed to Rp748.62 billion. The Company’s consolidated net profit for the period of 1H22 amounted to Rp1.53 trillion, which rose 32% YoY from the 1H21 net profit of Rp1.16 trillion.
At the end of 1H22 period, ANTAM financial position is maintained in well condition with a cash and cash equivalent position of Rp3.23 trillion. The solid position of ANTAM’s financial structure in 1H22 is also reflected in the decrease in the Company’s liability. Throughout 1H22, the Company was able to reduce its interest-bearing debt liabilities which consist of short-term bank loans and investment loans up to Rp2.76 trillion. Moreover, ANTAM’s interest-bearing debt at the end of the 1H22 period amounted to Rp4.32 trillion which decreased to 39% from the interest-bearing debt level at the end of 1H21 of Rp7.08 trillion. Furthermore, ANTAM’s solid financial structure within 1H22 was also reflected in the improvement of the Company’s S&P Global corporate credit outlook in 2022 from “B+/outlook Stable” to “B+/outlook Positive” that was announced on July 2022.
On June 2022, in accordance with the ANTAM Annual General Meeting Shareholders 2021 mandate and the profitability of the Company’s performance, ANTAM distributed the dividends to shareholders amounted to Rp930.87 billion or 50% of the net profit for the Financial Year of 2021.
As part of the Company’s commitment to the implementation of Good Corporate Governance principles, the Company ensures the financial aspect is fully managed with prudence, accountability, and transparency by complying with the applicable financial accounting standards. The implementation of the principles was reflected in the provision for legal cases in accordance with thorough, credible, and accountable mitigation of risk management aspect. Principally, provision is an accounting concept in the application of PSAK 57 to measure the uncertainty condition over the final decision of a legal case in the context of financial statements preparation. Related to the lawsuits that faced, ANTAM believes the Company has a strong position and legal defenses in the case. The Company will continue to file further legal efforts comprehensively in line with the applicable laws and regulations. The Company is always committed to implementing the Good Corporate Governance principles in every line of the Company’s business activity.
Sustainability of ANTAM’s Production and Sales Performance within 1H22 period
During the 1H22 period, ANTAM revenue amounted to Rp18.77 trillion. The revenue from domestic market sales became dominant with the contribution of Rp14.54 trillion or equal to 77% from 1H22’s net sales figure. In 2022, ANTAM has focused to develop domestic-based customers for its gold, nickel ore, and bauxite product.
During 1H22, ANTAM’s gold product sales became the largest contributor to total sales with a contribution of Rp12.28 trillion or 65% of ANTAM’s total sales. Furthermore, within 1H22, ANTAM gold sales volume achieved 13.47 ton, an increase compared to the 1H21 sales volume of 13.34 ton. In line with the national economic recovery and the improvement of gold metal in the domestic market, in 2Q22, ANTAM gold sales performance was growing by 5% to 6.89 ton compared to the first quarter period 2022 (January – March 2022, 1Q22) sales of 6.58 ton of gold. In terms of gold production, during 1H22, the gold outputs from the Company’s mine amounted to 673 kg. The profitability of the Company’s Precious Metals and Refinery remains solid with the segment’s net profit for the period of 1H22 marked at Rp859.96 billion or an 8% increase YoY from the 1H22 period of Rp795.50 billion.
To maintain excellent service to the gold customer, ANTAM applies the terms of online gold transactions through the Logam Mulia website, www.logammulia.com, and the ANTAM official boutique at the online marketplace platform of Tokopedia (“Butik Emas Antam Official” account), Shopee (“Butik Emas Antam Official Shop” account), and TikTok Shop (“Butik Emas Antam” account). This initiative is inlining with the Company’s aims to broader its market shares in the domestic gold market.
Within 1H21, the sales of ferronickel were the second largest contributor to ANTAM’s revenue, amounting to Rp3.12 trillion or 17% of total sales. During the 1H22 period, ANTAM’s ferronickel production and sales volume were recorded at 11,982 tons nickel within ferronickel (TNi) and 9,622 TNi respectively. Moreover, on the nickel ore commodity, nickel ore production volume in 1H22 amounted to 4.39 million wet metric tons (wmt) and nickel ore sales which were entirely absorbed by the domestic customer amounted to 3.04 million wmt. The operation and sales Nickel Segment’s performance in 1H22 was also affected by the global market volatility, particularly the COVID-19 lockdown conditions in several ferronickel’s product sales destinations in East Asia during 2Q22, which resulted in restrictions on export trading activities. In addition, the significant upward trend in nickel ore prices during 2Q22 was not followed by a similar significance in the price of nickel ore derivative products (e.g. stainless steel products) which also brought affected the absorption rate of ANTAM’s nickel segment products.
Nevertheless, despite the challenges faced during the 1H22 period, the profitability of ANTAM’s Nickel Segment (ferronickel and nickel ore products) remained solid. The sales contribution of the Nickel Segment in 1H22 reached Rp5.45 trillion, growing 18% YoY from the 1H21 sales of Rp4.64 trillion. The Nickel Segment’s net profit for the period of 1H22 reached Rp2.35 trillion, which rose 23% compared to the 1H21 period of Rp1.91 trillion. The Company believes the performance of ANTAM’s Nickel Segment will consistently grow in line with strengthening global economic conditions and the positive outlook for the absorption of nickel commodities.
In line with the ANTAM sustainability aims to reduce Greenhouse Gas (GHG) emissions, on June 2022, ANTAM signed a memorandum of understanding (MoU) with PT Perusahaan Listrik Negara (Persero) (PT PLN) for the potential cooperation on electricity supply in the Ferronickel Plant at Pomalaa, Southeast Sulawesi, by using New Renewable Energy (NRE) based power plant.
In 1H22, ANTAM’s Bauxite and Alumina Segment delivered a positive contribution to the Company’s consolidated profitability. Bauxite production volume in 1H22 reached 881 thousand wmt with bauxite sales figure amounted to 661 thousand wmt, a 13% increase from the sales volume in 1H21 of 587 thousand wmt. During the 2Q22 period, ANTAM’s booked bauxite sales volume of 559 thousand wmt, significantly increased from the 1Q22 sales achievement of 102 thousand wmt. In addition to export sales, in 2022, the Company will also focus on developing domestic sales of bauxite ore. On Chemical Grade Alumina (CGA) product, during 1H22, as many as 73,893 ton alumina was produced, a rose to 157% from the alumina production volume of 28,710 ton alumina in 1H21. Alumina production in 2Q22 achieved 40,063 ton alumina, an 18% increase from 1Q22 alumina production of 33,380 ton alumina. Moreover, the alumina sales volume reached 74,143 ton alumina in 1H22, or an increase of 21% from the sales volume in 1H21 at 61,241 ton alumina. In 2Q22, alumina sales volume achieved 39,321 ton alumina, hiked by 13% from 1Q22 sales volume of 34,822 ton alumina.
The proper implementation of the Company’s operational strategy was also reflected in the positive profitability of ANTAM’s Bauxite and Alumina Segment. Throughout 1H22, the net sales contribution from Bauxite and Alumina Segment amounted to Rp889 billion, which rose 45% YoY from the 1H21 period of Rp614 billion. The segment profitability improvement is also reflected in the net profit for the period for the Bauxite and Alumina Segment in 1H22 of Rp85 billion, significantly improved from the segment’s net loss for the period in 1H21 of Rp306 billion.
The Company’s Business Development Through the Implementation of the Mineral Downstream Program
With regards to the Company’s development projects in 1H22, ANTAM is currently completing the construction phase of the ferronickel plant construction project & the supporting plant facility in East Halmahera, North Maluku, which will have an installed capacity of 13,500 TNi per annum. In terms of the electricity supply for the ferronickel plant operation in East Halmahera, on March 2022, the Power Purchase Agreement with PT Perusahaan Listrik Negara (Persero) (PLN) to cooperate in providing electric supply for the next 30 years.
In relation to the development of the EV battery ecosystem, on April 2022, ANTAM with PT Industri Battery Indonesia (Indonesia Battery Corporation (IBC)), and PT Ningbo Contemporary Brunp Lygend Co., Ltd (CBL) signed the framework agreement on the development of an integrated EV Battery project. ANTAM and IBC also signed a similar agreement with LG Energy Solution. As part of the implementation of the nickel-based electric vehicle battery industry development initiative, on 23 August 2022, the Company held has conducted the Extraordinary General Meeting of Shareholders (EGMS) to seek the shareholder’s approval for the partial spin-off of the Company’s nickel segment in East Halmahera, North Maluku to the Company controlled subsidiary entity name PT Nusa Karya Arindo (NKA) and PT Sumberdaya Arindo (SDA) as the First Agenda of EGMS and the approval has been given by the shareholders for the Company’s spin-off proposal. Moreover, on the Second Agenda of EGMS, the shareholders approved the transfer of the Company’s assets in the form of shares in the Company’s subsidiaries, PT NKA and PT SDA where ANTAM will retain the majority ownership in both subsidiaries entity.
In addition, in line with ANTAM’s initiative to develop the added value of nickel ore laterite commodity, on August 2022, ANTAM and CNGR Advanced Material Co., Ltd signed a Strategic Head of Agreement to develop the Industrial Park project through the development of nickel laterite processing facility with the Oxygen-Enriched Side-Blown Furnace (OESBF) technology. The processing plant will convert the nickel lateritic ore into nickel matte products as materials for further battery-grade materials production. The plant will be established with a total nameplate production capacity of 80,000 ton of nickel per annum. In its development, the project will maximize and facilitate the application of green energy to reduce greenhouse gas emissions.
In terms of developing the bauxite downstream process, the Company is currently focusing on the construction of the Smelter Grade Alumina Refinery (SGAR) plant in Mempawah, West Kalimantan, which was jointly developed with PT Indonesia Asahan Aluminum (Persero) with a processing capacity of 1 million tons of SGAR per annum.
The Company believes the implementation of the downstream-based development synergy initiatives with a prudent and thorough application become a base of foundation for the Company’s business development and performance improvement in the future as well as provides a sustainable positive added value to the State, society, the Company shareholders, and stakeholders.