Holcim Indonesia

Stock Quote Holcim Indonesia - SMCB:

Business Summary

Holcim Indonesia operates two cement plants; one in Narogong (West Java) and the other in Cilacap (Central Java), and it owns a cement grinding station in Ciwandan (Banten). In a period of four years, Holcim intends to expand its production capacity to 12.5 million tons of cement per year. Increased output will originate from two new cement plants: the Tuban 1 plant, which will commence production in the third quarter of 2013, and the Tuban 2 plant, which is expected to start operations in 2015. Production capacity of both Tuban 1 and Tuban 2 is estimated at 1.7 million tons per year each. As such, the two Tuban plants, which are located in East Java, will add 3.4 million tons (annually) to the company’s current output of 9.1 million tons per year.

Holcim and its Indonesian-based subsidiaries primarily serve the island of Java, home to about 60 percent of Indonesia's total population. Java is characterized by rapid urban housing and commercial development as well as pressing needs in its infrastructure, including new power stations, ports, highways, and watercourses. Its customers include wholesalers, retailers and concrete products manufacturers (CPMs).

Holcim and its subsidiaries have a combined cement production capacity of approximately 9.1 million tons in Indonesia and a further 1.2 million tons in Malaysia. The company, which was founded as PT Semen Cibinong in 1971, is part of the Swiss-based Holcim Group, one of the largest global cement manufacturers.

Holcim Indonesia's Operational Highlights:

	2014	2015	2016	2017	2018
Domestic Cement Sales in million tons	8.8	9.1	9.6	10.5
Cement Exports in million tons	0.2	0.5	0.7	0.6

 

	2008	2009	2010	2011	2012	2013
Domestic Cement Sales in million tons	6.0	6.0	6.2	8.2	9.4	8.5
Cement Exports in million tons	1.6	1.9	1.6	0.5	0.1	0.2

^{Source: Holcim Indonesia, Annual Report 2017}

Holcim Indonesia's Financial Highlights:

	2014	2015	2016	2017	2018
Net Sales	9,483.6	9,239.0	9,458.4	9,382.1
Gross Profit	2,776.3	2,139.4	1,930.9	1,874.1
Income from Operations	1,206.2	909.5	205.9	218.9
Net Profit	659.9	175.1	(284.6)	(758.0)
EBITDA	1,872.1	1,833.9	1,365.7	1,259.4
Total Assets	17,199.3	17,321.6	19,626.4	19,763.1
Total Liabilities	8,617.3	8,871.7	11,702.5	12,429.5
Earnings per Share¹	86	23	(37)	(99)
Dividend per Share¹	99

 

	2008	2009	2010	2011	2012	2013
Net Sales	5,341.1	5,943.9	5,960.6	7,524.0	9,011.1	8,714.1
Gross Profit	1,950.0	2,249.7	2,249.4	2,862.9	3,346.8	3,160.0
Income from Operations	498.4	1,717.3	1,362.6	1,689.0	2,038.5	1,764.2
Net Profit	282.0	895.6	830.4	1,063.6	1,350.8	1,006.4
EBITDA	925.7	2,183.6	1,909.2	2,317.3	2,614.6	2,338.1
Total Assets	8,209.0	7,265.4	10,437.2	10,950.5	12,168.5	14,895.0
Total Liabilities	5,403.1	3,949.2	3,611.2	3,423.2	3,750.5	6,217.3
Earnings per Share¹	37	117	108	139	176	124
Dividend per Share¹	n.a.	n.a.	23	55	80	53

^{in billion IDR rupiah, unless stated otherwise
¹ in IDR rupiah
Source: Holcim Indonesia, Annual Report 2017}

Future Prospects of the Indonesian Cement Sector

Indonesia's cement sector has shown a steep increase in domestic cement production and consumption. This trend is estimated to continue for a number of reasons:

• Indonesia's current low per capita cement consumption
• The government's intention to ramp up much-needed infrastructure development
• An expanding middle class that gives rise to to new housing and real estate development
• Solid national economic conditions with annual GDP growth of plus 5 percent

What are issues that negatively affect the Indonesian cement sector?

• Infrastructure development is not reaching its full potential due to red tape, a weak legal system, and a lack of public and private funds
• International financial turmoil (USA and Europe) can influence Indonesia's economic growth, thus affecting domestic cement demand
• Recent central bank monetary tightening led to a cooling property market

Companies that dominate Indonesia's cement sector are Semen Indonesia, Indocement Tunggal Prakarsa and Holcim Indonesia. Click here for a detailed analysis of Indonesia's cement industry and market.