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Thursday, 05 July 12
BUMI ACHIEVES HIGHER SELLING PRICE IN FIRST QUARTER
 COALspot.com - PT Bumi Resources Tbk (BUMI), Indonesia's largest coal producer and exporter, has successfully maintained a higher sales margin, despite months of despair in the commodities sector, especially, thermal coal due to apprehension about the Eurozone crisis and speculation of lower short term growth prospects in China and India.
− Sales revenue up 19%, crosses $1 billion mark
− strong operating performance; approaching 16 million tons Volume
− stable operating income $149 million
− falling market, weakening currency hurts bottom line
− on track to cross 100 million tons coal production in 2014
According to BUMI’s today press release, first quarter 2012 audited financial results, a production and sales of 15.9 million tons was recorded compared with 14.3 million tons and 13.9 million tons, respectively, in the same period last year.
Bumi’s sales revenue was $1,007.9 million in Jan/Mar '12 up 18.6 percent compared with $849.9 million in this period last year. This revenue excludes 30 percent of coal sales from KPC and Arutmin attributable to Tata Power, according to BUMI’s press release.
Quite to the contrary, the average selling price of our coal is $92.8/ton in Q1'12 compared with $87.7/ton in Q1'11 or higher by 5.8 percent. BUMI has benefited greatly by its long term contracts with its blue chip customers. Although we experienced an 18.9% fuel cost increase ($0.98/liter in Q1'12 vs $0.83/liter in Q1'11) and expensed full stripping, our gross margin increased by 18.6 percent to $321.3 million yoy, the report said.
Bumi has been able to reduce selling commission to 2.5% (from 4%) when Glencore became its agent for Arutmin in the fourth quarter last year.
Operating income of $149.1 million in Jan/Mar '12 was recorded. A point to note is that this number adjusts $ 65.7 million as a one off amortization on our development assets arising from the new internal accounting policy we adopted this year, the report furtherer said.
The lower restated net income for Q1'11 is due to the new accounting policy adopted last year. Under this policy we have restated some figures from last year which may attract investors' attention in the short term. However, we believe that the benefits from an improved reputation and adoption of best international practices would far outweigh the short term book adjustments necessary, Bumi said in its report.
An adverse global market environment, the worsening Eurozone situation, a weakening rupiah and lower activity at Newmont's Indonesia operations have contributed in,
a) reversing our previous derivative gains because our share price fell by 30% yoy and revaluation of prepayment options of the 2 remaining tranches of CIC loan,
b) forex losses arising from the quarterly revaluations of VAT refundable by the Government of Indonesia,
c) a much lower income inflow from Newmont Nusa Tenggara because of the expected reduced activity from their Batu Hijau mine until their new mines are operational.
These factors have been the primary reasons for recording a reversal of our net income from positive to negative in Q1'12. But as the global and market environment registers improvement we believe the situation would favour Bumi during the later part of this year, BUMI explained its report.
Still delivering all promises
Acording to press release from BUMI, the proactive adjustments to new accounting standards - as per regulation and our new management policy in line with international practices -is another step by BUMI to deliver its promises in addressing four strategic issues the market is focused on i.e.
a) debt reduction (deleveraging and interest cost reduction),
b) value improvement,
c) operational excellence, and
d) a perception turnaround.
On operational excellence, Bumi's production increased by 11.5 percent to 15.9 million tons in Q1'12 from 14.3 million tons in Q1'11. We are hopeful of ending the year at ca 75 million tons (compared with 65.9 million tons in 2011), of this 80 percent is already contracted and priced at upwards of $85/ton FOB, the report said.
The average strip ratio in Q1'12 is 10.8 compared with 11.9 in the same period last year and we are working to drop this further to ca 10 which is targeted for this year. This indicates increasing efficiency in coal production. If fuel price weakens, we benefit by lower costs. Since 2009 the cost of diesel oil to produce 1 ton of coal has ranged from $ 5.6 (2009) to a high of $12.6/ton (Q1'12). Hence, the impact is significant and accounted for 27% of our production cash cost in Q1’12. A lower strip ratio (which is the volume of overburden removed - bcm - for every ton of coal mined) would be another downward cost trigger.
Infrastructure balancing projects to achieve a production capability exceeding 100 million tons/annum of coal in 2014 are on track. The underlying principle adopted is to build overcapacity across all elements of the coal supply chain and give us a 'make up' capability during adverse environmental conditions.
The 2nd OLC (Overland Conveyor) has already been installed in KPC - this now enables KPC to transport 64 million tons of processed coal to the port in a year (in 25 minutes at a speed of 30 km/ hour). The ship loading capacity at Tanjung Bara port in KPC is already operating at 7500 tons per hour (compared with earlier rate of 4500 tons per hour).
According to Bumi Resources Tbk's President Director Ari Hudaya, “Sustaining BUMI's global market leadership in thermal coal export while facing an uncertain and declining price environment can only be done by investing more in company's production facility to increase production capacity whilst improving efficiency.”
"This way, not only are we in a position to lower unit production cost but ensure the company's ability to offer long term supply contracts at best prices. Our standing in the short term remains very strong, and our global clientele can have peace of mind due to safe supply," said Dileep Srivastava, Director and Corporate Secretary of Bumi Resources.
Bumi's management was challenged with maintaining sustainable transformation of the company in the short term while strengthening its market leadership for the long term, in our businesses. "For our coal operations, depreciation charges are expected to be higher due to replacement of older equipment with newer technology and machinery to increase efficiency. So are stripping and increased mining activity, historical exploration expenses. We expense these today, as far as we can, as part of our commitment in transforming BUMI as the National Coal Champion with best global practices," Dileep added.
Prospects for 2012
Production - ca 75 million tons (no change)
Expected price - +$85/ton (from ca $90/ton)
Production cash cost -$42/ ton (from $40/ton & restated $44/ton in FY 2011)
We plan to review in October 2012 and provide a further refinement for this year - based on Jan/Sep year to date figures, Bumi's said on its report.
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Friday, 21 August 20
BHP COMMITS TO SELLING ITS THERMAL COALMINES WITHIN TWO YEARS - THE GUARDIAN
Move follows pressure from investors but company stops short of full exit from coalmining
BHP has announced it plans to sell off its ...
Thursday, 20 August 20
MINER BHP CONFIRMS PLANS TO EXIT THERMAL COAL SECTOR - THE SYDNEY MORNING HERALD
The head of mining giant BHP has laid out plans for a reshaping of its global operations by seeking to quit thermal coal mining, offload some cokin ...
Thursday, 20 August 20
LONDON RETAINS ARBITER CROWN - BALTIC EXCHANGE | HFW
Fears that the UK’s decision to leave the European Union would dent the reputation of the nation’s capital as the leader in maritime ar ...
Wednesday, 19 August 20
U.S. COAL STOCKPILES STEADILY INCREASE AFTER REACHING LOWEST LEVEL IN A DECADE IN 2019 - EIA
After reaching their lowest level in more than a decade in March 2019, U.S. coal stockpiles steadily increased to 152 million tons in April 2020, r ...
Wednesday, 19 August 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX DOWN 0.26 PCT - XINHUA
China Taiyuan coal transaction price index stood at 124.92 points Monday, down 0.26 percent week on week.
The index, released by Chi ...
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- Ministry of Finance - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Videocon Industries ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Georgia Ports Authority, United States
- Siam City Cement PLC, Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Sakthi Sugars Limited - India
- Tata Chemicals Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Central Electricity Authority - India
- The Treasury - Australian Government
- Chettinad Cement Corporation Ltd - India
- Essar Steel Hazira Ltd - India
- Sree Jayajothi Cements Limited - India
- Marubeni Corporation - India
- Gujarat Sidhee Cement - India
- Jaiprakash Power Ventures ltd
- Bulk Trading Sa - Switzerland
- Petron Corporation, Philippines
- Cement Manufacturers Association - India
- PetroVietnam Power Coal Import and Supply Company
- OPG Power Generation Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Commonwealth Bank - Australia
- Samtan Co., Ltd - South Korea
- Intertek Mineral Services - Indonesia
- South Luzon Thermal Energy Corporation
- Carbofer General Trading SA - India
- Wilmar Investment Holdings
- Planning Commission, India
- Parry Sugars Refinery, India
- Mercator Lines Limited - India
- Madhucon Powers Ltd - India
- VISA Power Limited - India
- Mintek Dendrill Indonesia
- Interocean Group of Companies - India
- GAC Shipping (India) Pvt Ltd
- Kobexindo Tractors - Indoneisa
- Ministry of Transport, Egypt
- Billiton Holdings Pty Ltd - Australia
- Oldendorff Carriers - Singapore
- SN Aboitiz Power Inc, Philippines
- SMG Consultants - Indonesia
- White Energy Company Limited
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sarangani Energy Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Bhatia International Limited - India
- Indonesian Coal Mining Association
- Lanco Infratech Ltd - India
- AsiaOL BioFuels Corp., Philippines
- MS Steel International - UAE
- Altura Mining Limited, Indonesia
- GVK Power & Infra Limited - India
- Thai Mozambique Logistica
- Miang Besar Coal Terminal - Indonesia
- Wood Mackenzie - Singapore
- Chamber of Mines of South Africa
- Kaltim Prima Coal - Indonesia
- Dalmia Cement Bharat India
- Toyota Tsusho Corporation, Japan
- Binh Thuan Hamico - Vietnam
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indo Tambangraya Megah - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Indian Oil Corporation Limited
- Bhoruka Overseas - Indonesia
- Thiess Contractors Indonesia
- Timah Investasi Mineral - Indoneisa
- Karaikal Port Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Tamil Nadu electricity Board
- Alfred C Toepfer International GmbH - Germany
- Karbindo Abesyapradhi - Indoneisa
- New Zealand Coal & Carbon
- Kohat Cement Company Ltd. - Pakistan
- SMC Global Power, Philippines
- Malabar Cements Ltd - India
- Edison Trading Spa - Italy
- Standard Chartered Bank - UAE
- CNBM International Corporation - China
- Latin American Coal - Colombia
- Australian Commodity Traders Exchange
- Bayan Resources Tbk. - Indonesia
- Posco Energy - South Korea
- Borneo Indobara - Indonesia
- Australian Coal Association
- Sojitz Corporation - Japan
- Indika Energy - Indonesia
- Central Java Power - Indonesia
- International Coal Ventures Pvt Ltd - India
- Indogreen Group - Indonesia
- Global Business Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- Maheswari Brothers Coal Limited - India
- Kapuas Tunggal Persada - Indonesia
- Sical Logistics Limited - India
- Straits Asia Resources Limited - Singapore
- Maharashtra Electricity Regulatory Commission - India
- Bukit Makmur.PT - Indonesia
- Ind-Barath Power Infra Limited - India
- Leighton Contractors Pty Ltd - Australia
- CIMB Investment Bank - Malaysia
- Manunggal Multi Energi - Indonesia
- McConnell Dowell - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Minerals Council of Australia
- Renaissance Capital - South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Meralco Power Generation, Philippines
- Mercuria Energy - Indonesia
- Bukit Baiduri Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Xindia Steels Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Energy Link Ltd, New Zealand
- Aditya Birla Group - India
- GN Power Mariveles Coal Plant, Philippines
- Cigading International Bulk Terminal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Makarim & Taira - Indonesia
- Formosa Plastics Group - Taiwan
- Coalindo Energy - Indonesia
- Jindal Steel & Power Ltd - India
- Romanian Commodities Exchange
- Uttam Galva Steels Limited - India
- Deloitte Consulting - India
- The University of Queensland
- San Jose City I Power Corp, Philippines
- Banpu Public Company Limited - Thailand
- TeaM Sual Corporation - Philippines
- Kepco SPC Power Corporation, Philippines
- Goldman Sachs - Singapore
- GMR Energy Limited - India
- Therma Luzon, Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Price Waterhouse Coopers - Russia
- Heidelberg Cement - Germany
- Mjunction Services Limited - India
- Attock Cement Pakistan Limited
- Global Green Power PLC Corporation, Philippines
- PTC India Limited - India
- Coal and Oil Company - UAE
- Eastern Energy - Thailand
- Savvy Resources Ltd - HongKong
- TNB Fuel Sdn Bhd - Malaysia
- Africa Commodities Group - South Africa
- Sindya Power Generating Company Private Ltd
- Indian Energy Exchange, India
- Star Paper Mills Limited - India
- Globalindo Alam Lestari - Indonesia
- Baramulti Group, Indonesia
- Metalloyd Limited - United Kingdom
- India Bulls Power Limited - India
- Orica Mining Services - Indonesia
- ICICI Bank Limited - India
- Bangladesh Power Developement Board
- Ministry of Mines - Canada
- Medco Energi Mining Internasional
- Bukit Asam (Persero) Tbk - Indonesia
- Siam City Cement - Thailand
- Economic Council, Georgia
- London Commodity Brokers - England
- Semirara Mining Corp, Philippines
- Trasteel International SA, Italy
- Vizag Seaport Private Limited - India
- Ambuja Cements Ltd - India
- Coastal Gujarat Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Electricity Authority, New Zealand
- ASAPP Information Group - India
- Grasim Industreis Ltd - India
- European Bulk Services B.V. - Netherlands
- LBH Netherlands Bv - Netherlands
- Rio Tinto Coal - Australia
- Global Coal Blending Company Limited - Australia
- Riau Bara Harum - Indonesia
- IHS Mccloskey Coal Group - USA
- Singapore Mercantile Exchange
- Directorate Of Revenue Intelligence - India
- Kartika Selabumi Mining - Indonesia
- Energy Development Corp, Philippines
- Bhushan Steel Limited - India
- Holcim Trading Pte Ltd - Singapore
- Port Waratah Coal Services - Australia
- IEA Clean Coal Centre - UK
- Jorong Barutama Greston.PT - Indonesia
- Independent Power Producers Association of India
- Directorate General of MIneral and Coal - Indonesia
- Anglo American - United Kingdom
- Simpson Spence & Young - Indonesia
- PNOC Exploration Corporation - Philippines
- Pendopo Energi Batubara - Indonesia
- Parliament of New Zealand
- Krishnapatnam Port Company Ltd. - India
- Electricity Generating Authority of Thailand
- Larsen & Toubro Limited - India
- Kumho Petrochemical, South Korea
- Antam Resourcindo - Indonesia
- Merrill Lynch Commodities Europe
- Meenaskhi Energy Private Limited - India
- PowerSource Philippines DevCo
- Bahari Cakrawala Sebuku - Indonesia
- Vedanta Resources Plc - India
- Agrawal Coal Company - India
- Power Finance Corporation Ltd., India
- Orica Australia Pty. Ltd.
- Bharathi Cement Corporation - India
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