“The automotive segment contributes around 30 to 40 percent to Astra’s bottom line, so we will likely see further contraction in the bottom line despite the economic recovery,” Koneksi Kapital analyst Alfred Nainggolan said, expecting the profit shrink to continue until year-end due to the low vehicle sales.However, the situation is expected to only be temporary with Alfred believing that the company has the opportunity to grow in 2021 due to improving automotive sales, rising crude palm oil (CPO) prices and growing property business.Astra, which has over 230 subsidiaries working under seven business segments, reported a 23 percent annual decline in revenue to Rp 89.8 trillion (US$6.19 billion) as of June 30. Its net profit, excluding revenue from the sale of Bank Permata shares, nosedived 44 percent annually to Rp 5.5 trillion. Net profit in the company’s automotive segment crashed 79 percent yoy to Rp 716 billion, making it the third-largest contributor to the conglomerate’s net profit, after having contributed the most in June last year.Astra director Johannes Loman expected the company’s motorcycle sales to fall 40 to 45 percent this year. This means Astra projects to sell a total of 2.7 million to 2.95 million motorcycles this year from last year’s 4.91 million units.The pandemic has also affected Astra’s financing business. Director Suparno Djasmin said the company’s financial services subsidiaries had restructured a total of Rp 30 trillion in loans from 1 million customers as of July.“Most of the restructured credits were coming from motorcycle ownership loans because the pandemic disrupted customers’ ability to repay their loans,” he said.He said the rate of loan restructuring had slowed down since June following the government’s decision to ease the PSBB.Astra, a publicly listed company, currently has no plan to expand its businesses despite gaining a significant profit from the sale of its stake at Bank Permata to Bangkok Bank.Bangkok Bank acquired in May a 89.12 percent stake in Bank Permata from Astra and United Kingdom-based Standard Chartered Bank for Rp 33.66 trillion, 1.63 times Bank Permata’s book value. “We are focusing on strengthening our balance sheet, but we are always open if a good opportunity presents itself,” Astra president director Djony Bunarto Tjondro said on Monday.The company announced in June that it halved capital expenditure to between Rp 10 trillion and Rp 11 trillion this year as part of its effort to conserve cash.Astra International shares, traded with the code ASII at the Indonesia Stock Exchange (IDX), had lost 23.47 percent of its value so far this year. The company’s share prices jumped 0.94 percent as of 2:02 p.m. Jakarta time on Tuesday to Rp 5,350 apiece.Topics : Diversified conglomerate PT Astra International is aiming to maintain its car market share at 52 percent this year despite the automotive market’s sluggish performance during the pandemic.The Association of Indonesian Automotive Manufacturers (Gaikindo) has projected that this year’s car wholesales will only reach 600,000 units, a 42 percent plunge compared to last year’s number, as the outbreak hits purchasing power.“We still intend to keep our share at the same rate as last year despite the slump,” Astra director Henry Tanoto said during a virtual press briefing on Monday. This means that Astra expects to sell around 300,000 cars this year, well below Astra’s total car sales in 2019 at 536,402.The market share of Astra, which has around half its revenue sourced from its automotive business, plunged to just 31 percent in May, when national car sales plummeted 95.7 percent year-on-year (yoy) to 3,500 cars following the introduction of large-scale social restrictions (PSBB) to contain the coronavirus spread. Astra usually dominates the market with a share of around 50 percent.Its market share slowly recovered in June to 38 percent and 40 percent in July in line with rebounds in sales nationwide. At least 25,283 cars were sold in July across the country, higher than 12,623 in June but far lower than 89,254 cars in July last year, according to Gaikindo data compiled by Astra.Head of investor relations Tira Ardianti said the company had prepared several strategies to maintain its market share. The strategies include strengthening its product lines with new and revamped models and providing the best customer experience from presales to after-sales, she told The Jakarta Post on Monday.
Monaco-based dry bulk shipping company Scorpio Bulkers has entered into an agreement to purchase exhaust gas cleanings systems (EGCS) for a total of 28 of its vessels.The deal, which is a part of the company’s previously announced program to install scrubbers across its fleet, would see Scorpio Bulkers buy the equipment for 18 of its vessels in 2019 and for another 10 units in 2020.The total value of these contracts was estimated to be around USD 42.4 million.Scorpio Bulkers explained that the systems that are being fitted are of ‘hybrid ready’ design, which allows them to be upgraded to a closed loop configuration at a future date.Furthermore, as part of the agreement, the company has an option to purchase exhaust gas cleaning systems for up to 18 additional vessels in 2020.