Bumi Resources to Take Care of Debt Ahead of Schedule
Bumi Resources, Indonesia’s biggest coal miner by production, plans to repay the second and third tranches of its debt to a Chinese sovereign wealth fund two years ahead of schedule.
Dileep Srivastava, the investment relations director at Bumi, said the Jakarta-based company plans to pay off $600 million in debt, which is the second tranche of payment to China Investment Corporation, in the fourth quarter of this year, two years early.
It will also pay the final tranche of $700 million in the fourth quarter of 2013, which would also be two years early.
In 2009, Bumi signed a deal with CIC for $1.9 million in loans, according to Bumi’s Web site. The first $600 million tranche was paid in the fourth quarter of 2011.
Bumi also plans to settle its $375 million in convertible bonds before they mature in August 2014.
Dileep said the company aims to “cut interest costs by 50 percent by the end of 2013.”
He also affirmed the early repayment of loans from two major shareholders of the company, Recapital Asset Management and Bukit Mutiara.
Operationally, Dileep said Bumi is “on track to reach production of 100 million tons per year in 2014. Infrastructure upgrades to achieve this are expected to be commissioned over 2012 and 2013.”
Local media reported last week that Bumi aims to increase the traffic at its Tanjung Bara ship and barge coal loading terminal to 7,500 tons per hour this year from 4,500 tons per hour in 2011. The terminal serves its mining unit Kaltim Prima Coal.
Dileep estimated sales revenue at around $5.8 billion for the 2011 fiscal year versus $4.3 billion in 2010.
As for 2012, he said the company has a target to reach an annualized coal mining capacity exceeding 80 million tons, and expects an increase in sales volume of around 20 percent, versus around 63 million tons in 2011.
Bumi shares rose 2 percent on Friday to close at Rp 2,525 on the Indonesia Stock Exchange.