Gajah Tunggal YTD 9M08 Sales Grew by 20% Amid Increasing Material Costs and Weaker Currencies

PT Gajah Tunggal Tbk increased 9M08 sales by 20% Y-o-Y to Rp. 6,045bn from Rp. 5,048bn, as both domestic and export demand remained strong despite a difficult global earning environment. As average raw material costs reached historic highs and European currencies became weaker in 3Q08, 9M08 gross margin decreased to 14.5%, compared to 18.1% in 9M07. Consequently EBITDA in 9M08 decreased to USD 79mn, compared to EBITDA in 9M07 of USD 83mn.

The company’s 9M08 net income increased by 21 % y-o-y, from Rp. 112bn to Rp. 135bn, despite a small forex translational loss due to the weakening rupiah versus the US dollar and also the weakening in Euro and Pound Sterling in 3Q08. Positive performance from our associated company, PT Polychem Indonesia Tbk of Rp. 28bn, also contributed to the rise in net income.