Indonesia Bakrie Sumatera plans $66 mln capex in 07

Reuters / Yahoo Finance - 2006-11-29 11

JAKARTA, Nov 28, 2006 (Reuters) - Indonesian plantation company PT Bakrie Sumatera Plantations Tbk plans to triple capital spending next year in its effort to boost revenue and expand its palm oil business, its chief said on Tuesday.

Bakrie Sumatera, controlled by the family of Indonesia's chief social welfare minister Aburizal Bakrie, said it plans 600 billion rupiah ($65.7 million) in capital spending next year compared with 200 billion budgeted for this year.

"The money will also be used to finance the construction of a biodiesel plant and to build new palm oil mills," the company's President Director Ambono Janurianto told reporters. He did not elaborate.

Janurianto said the company expects revenue growth to be 30 percent and operating profit to grow 35 percent this year. The company expects next year's revenue growth at 35 percent and a 20 percent increase in operating profit.

In 2005 the company posted revenues of 883.31 billion rupiah and operating profit of 223.16 billion.

According to Reuters Estimates, the company's revenue will increase to 1.09 trillion rupiah and 1.26 trillion in 2007.

Bakrie Sumatera plans to jointly build the country's first biodiesel plant with construction firm PT Rekayasa Industri to meet a surge in demand for renewable energy.

The $25 million plant would have the capacity to produce between 60,000 and 100,000 tonnes of biodiesel a year as a substitute for diesel fuel.

Indonesia, a member of the OPEC oil producers' cartel but forced to import a quarter of its fuel, is scrambling for alternative energy sources as its oil and gas reserves dwindle and soaring world oil prices increase the burden of its fuel subsidies.