Board of Directors
Dear Esteemed Shareholders,
On behalf of the Board of Directors, we would like to thank God for His blessing and we would like to present the Company’s Annual Report as the Company’s responsibility especially to the shareholders and generally to the public.
The Indonesian economic growth decreased to 5.7% in 2013 compared to 6.2% in 2012 following the decline in the world economic growth which is still affected by the global crisis.
The average price of Aluminum and Copper in 2013 decreased to US$1,845.91/ton and US$7,326.17/ton respectively.
The Company recorded consolidated net sales of Rp.2.51 trillion in 2013 which consist of export sales of Rp.281.06 billion and local sales of Rp.2.23 trillion.
The Company recorded gross profit of Rp.258.01 billion or 10.28% of sales in 2013 compared to 2012 of Rp.372.11 billion or 14.98% of sales. The Company recorded operating profit of Rp.122.75 billion or 4.89% of sales in 2013 decreased compared to 2012 of Rp.217.24 billion or 8.74% of sales.
In the human resource sector, the Company implemented 4 groups system for operators from previously of 3 groups. In 2013, the Company achieved production capacity for Aluminum cable of 27,600 ton, Copper cable of 9,600 ton and fiber optic cable of 1,600,000 Fkm.
Through all challenges in 2013, the Company booked net profit of Rp.39.09 billion.
The Company is optimist to face the future with the stable government, the recovery of the world economy in general and Indonesia in particular.
In the State Budget year 2014, the Government allocates Rp.145.4 trillion for construction of infrastructure to stimulate the economic growth, which consist of transportation of Rp.124.5 trillion, electricity & energy of Rp.16.3 trillion, housing of Rp.4.6 trillion. The Ministry of transportation targets to build 20 new airports, renovate 120 airports, and build new rail road track of 98.1 km (including double tracks). Meanwhile, the budget for energy infrastructure will be allocated to increase power plant capacity to 164 MW, transmission of 4,881 kms, substation of 1,020 MVA and distribution of 136.72 MVA. In addition, the Government target to increase electrification ratio to 81.4% next year.
PLN will allocate more than Rp.5.5 trillion for capital expenditure in the next year. The fund will be allocated to build power plant and transmission projects in each island in Indonesia. PLN assumes that Crash Program of 10,000 MW Power Plant Phase I will finish next year, since this program already finished 80%. This is a good prospect for the Company to increase sales of power cable, especially to PLN and private sector.
In 2014, PT Telkom plans to optimize the existing IP Radio contract through an amendment contract to accelerate the provision of Telkomsel backhaul Node-B and restructuring TITO contracts and add 4 global partners in the FTTH deployment. We expect demand for optical fiber will increase next year.
In the property sector, Perseroan predicts the property sector will grow around 20-25%, slightly decrease compared to this year of average 30%. The Company needs to formulate marketing strategy to increase free market sales as the market is still huge and potential. The Company needs to set competitive price, increase production capacity, expand market share and improve brand image.
The Company will increase its export sales to African and Asian countries next year to have natural hedging and minimize foreign exchange risk. Since Indonesia will hold Presidential Election in year 2014, The Company will focus on boosting export sales, as local market will be relatively stagnant in year 2014.
As the Management’s commitment to the environment and safety workplace, the Company has implemented Safety and Health Management System and Prevention of Environmental Pollution and achieved ISO 14001 and OHSAS 18001 certificates from SGS in 2010.
The Company performs Corporate Social Responsibility (CSR) by maintaining harmonious relationship with the local community. The Company’s concern toward the community’s prosperity is aimed to find potentiality which can grow and develop within the Company.
The Company highly appreciates the public trust by implementing good corporate government principals i.e. transparency, accountability and responsibility and believes that those elements will increase the Company’s value in long term period. The Company has socialized and implemented the Company’s Code of Business and Work Ethics to all employees.
The Company will consistently perform continuous improvement, increase production capacity in order to satisfy market demand with high efficiency and productivity as well as to challenge more competitive market. The Company will formulate effective strategy to face the competitive market. The Company’s core values, vision and mission will become our beacon to step into the future with high spirit.
On behalf of the Company’s Board of Directors, we would like to thank and highly appreciate the shareholders, Board of Commissioners, customers, business partners and all employees for their support and cooperation to the Company. With the continuous support, we are confident that the Company will be able to improve its performance to achieve target and business plan.
Jakarta, April 2014