Tin Producer PT Timah Reports US$92.85M Net Profit in 2021

TheIndonesia.id - Tin producer and exporter PT Timah has reported a net profit of Rp1.3 trillion (US$92.86 million) in 2021, a significant achievement after Rp341 billion loss in 2020.

Corporate secretary Abdullah Umar said lower cost of revenue contributed to the positive performance.

“The surge in PT Timah Tbk’s profit was due to the cost of revenue in 2021 which decreased by 21 percent to Rp11.17 trillion compared to Rp14.09 in the previous year,” Umar said on Tuesday, March 15, as reported by Antara.

Its EBITDA also rose by 150 percent, from Rp1.16 trillion to Rp2.09 trillion which was driven by the decreasing financial burden because the company was able to implement its deleveraging strategy and get low-cost financing.

PT Timah also reported that the net profit margin increased from -2 percent to 9 percent, while the gross profit margin rose from 7 percent to 24 percent.

Despite the positive financial performance, the tin ore production was only reported at 24,670 tons, declining 15,087 tons from previous year’s production at 39,757 tons. This was noted as a result of the COVID-19 pandemic.

Umar explained that 46 percent of the total production was from land-based mining while the remaining 54 percent was from deep-sea mining in the company’s operational regions in Bangka Belitung and Riau Islands.

According to him, the company continues to work on optimizing its mining as one of the strategies to respond future challenges.

“In the future, we will answer the challenges of operational performance with optimism. The company will optimize the mapping of mining locations more accurately. [We will] also improve several aspects related to our strategy and mining facilities,” Umar said.

Lastly, PT Timah also revealed that it’s currently building a smelter with Ausmelt technology, which is expected to increase the company's production since it can process low-grade tin.

"The use of Ausmelt technology, which will start operating in the second half of this year, is expected to reduce production cost of tin metal, so the company’s profitability can further improve amid the competitive business climate," Umar said.