Gajah Tunggal Posts Growth in Revenue for FY2008, But Takes Large Translational Forex Hit at Year End
In a difficult earning environment, especially in the 4th Quarter of 2008, PT Gajah Tunggal Tbk managed to increase its whole year sales in 2008 by 20% to reach Rp. 7,963bn from Rp. 6,660bn in 2007. While sales revenue showed strength, EBITDA in 2008 decreased to USD 94mn, as significant raw material fluctuations and a lag time in increasing prices before the onset of the economic crisis, pressed gross margin from 17.6% in 2007 to 14.3% in 2008. Operations in 2008 were characterized by steep rises in raw materials in the first three Quarters of the year, as the Company steadily increased installed Radial and Motorcycle capacity, and a sharp drop in demand in both the export as domestic markets towards the end of the year.
Bottom line swung to a loss in 2008, as the depreciating Rupiah against the US Dollar caused a significant forex translational loss and our associated company, PT Polychem Indonesia Tbk negatively contributed with a loss of Rp 76bn. Gajah Tunggal posted a net loss of Rp. 625bn in 2008, compared to a net income of Rp. 91bn in 2007.