Indika Energy Receives Petrosea Divestment Approval, Significant records Q1 2022 Financial Performance

An investment company with a diversified business portfolio, PT Indika Energy Tbk. (the Company) , held an Extraordinary General Meeting of Shareholders (EGMS) on 20 May 2022. The EGMS approved the planned sale of all of the Company’s shares in its subsidiary, PT Petrosea Tbk. (Petrosea).

e proceeds of the transaction will be used to support Indika Energy’s new investment and optimize liability management. This transaction will also allow Indika Energy to save on capital costs, as well as strengthen its financial position by reducing liabilities on a consolidated basis,” said Azis Armand, Deputy President Director and Group CEO of Indika Energy. , in a written statement received, Wednesday (25/5/2022).

Petrosea Divestment

Previously on February 18, 2022, the Company signed a Conditional Sale and Purchase Agreement (CSPA) with PT Caraka Reksa Optima (CARA) in connection with the planned sale of all shares in Petrosea or a total of 704,014,200 shares representing 69.8% of the Company’s share ownership in Petrosea. . 

The agreed valuation is equivalent to USD210 million. Thus, the estimated sales value from this transaction is USD146.58 million. Petrosea is a multi-disciplinary company engaged in contract mining, especially coal with 50 years of experience. 

According to Azis, Indika Energy will continue to review its business portfolio, prioritize sustainability aspects, and focus on diversifying outside of its core sectors in the energy and mining sectors.

“This transaction is one of our efforts to increase revenue by 50% from the non-coal sector, as well as develop a business that is in line with the company’s Environmental, Social, and Governance (ESG) commitment to being carbon neutral by 2050,” said Azis.

The Company’s 3M-2022 Gross Profit was recorded at US$ 260.8 million, or an increase of 145.3% compared to USD 106.3 million in 3M-2021. The Company’s Gross Profit Margin also increased to 31.4% from the previous 20.2% which was mainly due to the improvement in Kideco and MUTU performance.

Meanwhile, the Company’s Finance Expenses increased by 2.3% from USD26.0 million to USD26.6 million in 3M-2022 which was mainly due to the relaxation of interest rate swap (IRS) fees of USD0.5 million in connection with refinancing the loan for the terminal construction project. fuel storage in East Kalimantan. 

As a result, the Company posted a Profit for the Period attributable to Owners of the Parent of USD75.0 million in 3M-2022, compared to a Net Loss of USD9.4 million in 3M-2021. The Company also recorded a Core Profit of USD95.1 million in 3M-2022, a significant increase of 638.8% compared to USD12.6 million in the same period the previous year. 

In 3M-2022, the Company’s cash, cash equivalents and other financial assets stood at USD1,125.3 million. Realized capital expenditure in 3M-2022 was USD4.4 million, of which USD1.1 million was used for Kideco, USD1.0 million was used for Interport, and USD0.3 million was used for Indika Indonesia Resources. In 3M-2022, the Company also invested USD36.1 million, of which USD22.0 million was used for the Awak Mas gold project in South Sulawesi.