0 Despite Strong Finish, Adaro Posts 2012 Drop in Coal Sales

The country’s second-largest coal miner, Adaro Energy, saw a 1 percent decline in production volume and a 4 percent decrease in sales volume last year, the company said in a filling to the Indonesian Stock Exchange on Friday. The company did not provide any reason for the decline in production and sales. The miner produced 47.19 million metric tons of coal last year, while sales volume fell to 48.62 million metric tons. On a quarter to quarter basis, the miner closed the year with strong performance in the fourth quarter with production rising 7 percent to 13.31 million metric tons. 

“We benefited from our preparation in the third quarter of 2012 for the rainy season, as we finished the year in a strong position to meet demand,” said Cameron Tough, Adaro’s head of investment relations. Sales volume climbed 12 percent to 13.95 million tons in the fourth quarter, thanks to a rebound in the coal market, according to Tough. Years of strong demand from China and India, Indonesia’s largest coal consumers, have encouraged local producers to mine more coal, and that has contributed to a global supply glut. 

The decline in coal’s price was worsened by the fact that the United States has been using a large amount of natural gas, pushing the country to ship coal to Asian markets. This year, however, the market situation is expected to improve thanks mostly to an expected economic recovery in China. “We view 2013 as a year of consolidation to focus on improving our business processes and reducing costs by improving collaboration with all our contractors to have effective, efficient and safe operations,” Tough added. 

Adaro set a target to reach a production volume between 50 to 53 million metric tons and to generate $850 million to $1 billion in Ebitda (earnings before interest, taxes, depreciation and amortization) this year. Ebitda is used to measure a company’s operating cash flow. Adaro saw its revenue fall 5.8 percent to $2.75 billion, with a 7.9 percent decline in revenue to $347 million during the first nine months last year. Indonesia, the world’s largest coal exporter, shipped close to 75 percent of its production volume of 386 million tons last year, according to data from the Energy and Mineral Resources Ministry.

source : the jakarta globe