Bumi Resources Minerals (BRMS) Increases Gold Production

Bumi Resources Minerals (BRMS) Increases Gold Production
PT Bumi Resources Minerals Tbk (BRMS) continues to expand the capacity of the gold factory. At the end of last year, BRMS started operating a second gold factory with a utilization of 200 tons of ore to 500 tons of ore per day.

BRMS Director Herwin Hidayat said the utilization of the second gold factory is targeted to increase to the level of 1,000 tons of ore per day in February-March this year. “In April-June 2023 it is hoped that the capacity of the second factory will increase to a level of 2,000 tons of ore per day,” said Herwin to Kontan, Monday (23/1).

Herwin continued, the utilization of this second factory is also expected to reach full capacity of 4,000 tons of ore per day in July this year.

It doesn’t stop there, BRMS is also targeting to build a third and fourth gold factory with a capacity of 4,000 tons of ore per day and 2,000 tons of ore per day respectively.

The third gold factory located in Palu and the fourth factory located in Gorontalo are expected to be completed in the first half of 2024.

“This means starting to operate in the second half of 2024 with production levels increasing periodically until each factory reaches full capacity,” explained Herwin.

Herwin continued, since 2020 BRMS gold production has continued to increase. This increase is supported by the presence of a new factory.

As an illustration, gold production in 2020 reached 2,200 Oz of gold, this amount increased to 4,300 Oz in 2021 and reached around 5,000 Oz in 2022.

“The hope is that in 2023 gold production can increase above 25,000 Oz and in 2024 it will rise again to a level above 40,000 Oz,” added Herwin.

The production increase is targeted to continue to the level of 80,000 Oz of gold per year in the future.

Director of Avere Investama Teguh Hidayat said BRMS performance might indeed be driven by sentiment of rising gold prices. However, the effect is considered not to be significant.

At least, there are two things that affect this condition. One, the mineral commodity assets owned by BRMS are quite large. A number of these assets are still in the exploration stage. Second, the debt level of BRMS is still considered high.

According to him, the exploration for mineral commodities that has been carried out so far requires quite a large amount of money. In addition, this investment is long term.

“Now (gold) is starting to produce, there is already cash flow, which means you can start paying off your debts,” Teguh told Kontan, Monday (23/1).

According to him, the current strategy is to wait and see while waiting for performance improvements. “If the performance is indeed good, at the current price it is also okay. But recently, the performance is still not good, so we will wait for the developments,” said Teguh.

BRMS posted revenue of US$ 8.32 million at the end of September 2022. This figure was a slight increase of 1.03% from actual revenue in the same period last year of US$ 8.25 million.

From a bottomline perspective, BRMS posted a net profit of US$ 6.47 million, up 5.80% from net profit in the same period in 2021 of US$ 6.11 million.

Meanwhile, BRMS’s total liabilities until the third quarter of 2022 were recorded at US$ 153.16 million. This amount consisted of long-term liabilities of US$ 62.14 million and short-term liabilities of US$ 91.02 million.