PT Indo Tambang Raya Megah Tbk (ITMG) has maintained its coal sales volume target of 22 million tons by the end of 2020, even though the world economy is still slowing down. This target is supported by the acquisition of 87% of sales contracts from the target set by the company. President Director of Indo Tambang Raya Megah Mulianto said that the Covid-19 pandemic caused a global economic slowdown and suppressed trade flows, both domestic and international, thus impacting the company’s financial performance. However, the company is optimistic that it can still achieve the coal sales volume target that has been set since the beginning of the year.
“The company is optimistic that it will achieve the sales volume target of 22 million tons of coal this year. Even though the achievement until the first semester of 2020 has only reached 11.1 million tonnes, Mulianto explained in his official statement received by Investor Daily in Jakarta. Entering the second half of this year, he said, the company has secured 87 percent of sales contracts from this year’s sales volume target. As much as 67% of the selling price has been determined and 20% refers to the coal price index. He is also optimistic that demand for coal is likely to improve and is expected to have an impact on the average selling price in the second half of this year. This expectation is supported by the recovery of China’s economy.
Meanwhile, during the first semester of 2020, the company’s average coal selling price fell to a level of US $ 55.8 per ton, compared to the same period in the previous year of US $ 68.8 per ton. Mulianto added that his party will continue to maintain operational activities without interruption, implement cost control and discipline capital expenditures to support this year’s performance. “We will also continue to maintain a strong cash position through the implementation of an effective and efficient cash management strategy, so that the company has sufficient funds for organic expansion and regular dividend payments,” he said. As of the first semester of 2020, the company posted revenues of US $ 652.62 million, corrected by 26.89% from the same period last year of US $ 892.70 million.
Net profit decreased by 57.80% to US $ 29.88 million, compared to the first semester of 2019 valued at US $ 70.82 million. “This is due to the decrease in the average selling price of coal which causes net income to shrink and erodes net income,” said Mulianto. Indo Tambang Raya Megah has sold 11.1 million tons of coal during the first semester of 2020. In detail, the sales were exported to China as much as 3.2 million tons, Japan with 2.6 million tons, the Philippines with 0.8 million tons, and Thailand with 0.7 million tons), while for domestic needs as much as 1.9 million tons. tons and the rest for other countries in East and Southeast Asia. Meanwhile, the company’s coal production volume is targeted to reach 19-20.1 million tons this year.
The company produced 8.9 million tons of coal in the first half of 2020. As of the end of June 2020, the company’s total assets were valued at US $ 1,229 million with equity of US $ 862 million. The company has a strong cash and cash equivalents position of US $ 208 million without debt.