Astra International: 2014 Profit of Indonesia’s Largest Firm Slightly Down
Indonesia’s largest listed company in terms of market capitalization and one of the country’s largest diversified conglomerates, Astra International (which is often labelled the barometer of the Indonesian economy due to the company’s presence in various sectors, from car distribution to plantations, financial services and heavy equipment) posted mixed results in 2014. Based on Astra’s latest corporate earnings report, its full-year 2014 net profit fell 1.2 percent year-on-year (y/y) to IDR 19.2 trillion (USD $1.5 billion).
The slight decline in Astra International’s overall net profit was attributed to lower earnings in its automotive and infrastructure & logistics divisions. On the other hand, the company recorded improved earnings in its agribusiness, contract mining operations and financial businesses divisions. Meanwhile, Astra International booked a 4 percent (y/y) growth in revenues to IDR 201.7 trillion (USD $15.7 billion).
Prijono Sugiarto, President Director at Astra International, said in a statement that the company’s cost of revenue climbed 2.72 percent (y/y) to IDR 162.89 trillion (USD $12.7 billion) attributed (partly) to higher general as well as administrative expenses and impairment losses on the company’s mining properties. The statement further mentioned that Astra International controlled IDR 236.03 trillion (USD $18 billion) in assets at end-2014, while liabilities reached IDR 115.71 trillion (USD $9.0 billion) and equities at IDR 120.32 trillion (USD $9.4 billion).
Astra International's Net Income per Business Segment:
| Business Segment | 2013 |
2014 | Change (Y/Y) |
| Automotive | 9,829 | 8,480 | -13.7% |
| Financial Services | 4,273 | 4,748 | +11.1% |
| Heavy Equipment & Mining | 2,971 | 3,268 | +10% |
| Agribusiness | 1,435 | 1,995 | +39% |
| Infrastructure, Logistics & Other | 748 | 490 | -34.5% |
| Information Technology | 161 | 200 | +24.2% |
| Total | 19,417 | 19,181 | -1.2% |
in billion of IDR rupiah
Source: Astra International, Financial Report 2014
Astra International's Financial Highlights:
| 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | |
| Net Revenue | 97,064 | 98,526 | 129,038 | 162,564 | 188,053 | 193,880 | 201,700 |
| Net Profit | 9,191 | 10,040 | 14,366 | 17,785 | 19,421 | 19,417 | 19,180 |
| Total Assets | 80,740 | 88,938 | 113,362 | 154,319 | 182,274 | 213,994 | 236,030 |
| Total Liabilities | 40,163 | 40,006 | 54,559 | 78,481 | 92,460 | 107,806 | 115,710 |
in billion of IDR rupiah
Source: Astra International, Financial Report 2014
Sugiarto added that the company remains cautious about the immediate outlook given the uncertain external macroeconomic environment in Indonesia, increased competition in the car market and the likelihood of a continuation of lower coal prices. However, as the group is well financed and delivers quality products and services it has solid prospects over the longer term, particularly as economic growth in Indonesia is estimated to accelerate.
Astra International, controlled by the Hong Kong-based Jardine Matheson Group, is particularly known for its dominating role in Indonesia’s automotive sector. Through a jointly-controlled entity with Japan’s Toyota Motor Corporation, the company holds the exclusive right to distribute Toyota vehicles - the most popular car brand in Southeast Asia’s largest economy - on the Indonesian market. In 2014, Astra International held a 51 percent market share in terms of car sales in Indonesia. However, over the past decade the company’s market share has been declining due to increased competition in Indonesia’s car industry, triggering discount wars hence limiting profitability.
Several notable subsidiaries of Astra International are:
• Astra Otoparts (automotive components)
• Astra Agro Lestari (palm oil)
• Serasi Autoraya (car rental services)
• Astra Graphia (document information & communication technology)
• United Tractors (heavy equipment)
The company submitted its corporate earnings report to the Indonesia Stock Exchange (IDX) a few minutes after trading had ended on Thursday (26/02). However, speculation that earnings were weaker than in the previous year led to its shares declining 1.2 percent to IDR 8,050 per share on Thursday. Today, after investors have been able to study the report, the decline continued. Astra International’s shares were down 2.17 percent to IDR 7,875 at 10:30 am local Jakarta time on Friday (27/02).
Stock Quote Astra International - ASII:
Astra International's stock chart shows a sharp fall in early June 2012 as the company conducted a 1:10 stock split, thereby making the company's shares more affordable and increasing its liquidity