Holcim Indonesia's 2015 Profit Slumps 73% on Lower Demand, Higher Costs
Jakarta. Holcim Indonesia, the local unit of the Swiss cement maker, booked a 73.46 percent decline in profit last year on the back of low cement demand and rising costs, the company said in a statement on Wednesday (16/03).
Holcim booked Rp 175.13 billion ($13.21 million) in net income in 2015, compared to Rp 659.87 billion a year earlier. The company also recorded a 2.6 percent decline in earnings to Rp 9.2 trillion for the same period, amid slower economic growth.
"[The profit] reflects the lower sales and higher costs from the company's new plant in Tuban [East Java], higher electricity tariffs and restructuring costs before integration with Lafarge Cement Indonesia," the statement said.
Holcim Indonesia completed a Rp 2.14 trillion acquisition of a 99.99 percent share in Lafarge Cement Indonesia in February as part of global merger between the Swiss and French cement makers.
The merger is said to have increased Holcim Indonesia's assets to Rp 21.6 trillion. However, the company's total assets as of Dec. 31 – as reported in the financial statement – improved slightly to Rp 17.32 trillion, which is an increase of only 0.71 percent from a year earlier.
National cement consumption fell 1.7 percent to 60.9 million metric tons last year compared to the same period a year earlier.
"Despite pressures from higher costs and lower revenue, we are still able to maintain our market share. We've restructured to operate in a more efficient way," Holcim Indonesia country chief executive Gary Schutz said in the statement.
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