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Bullish Bumi Dismisses Euro Fears
Jakarta Globe | December 11, 2011

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Bumi Resources, the world’s largest thermal coal exporter, says its target to increase coal production by 10 percent is on track and the price its coal attracts will remain strong despite the euro zone crisis creating concern.

Dileep Srivastava, Bumi Resources’ investor relations director, said that 2011 coal production of 66 million tons was on track, while average sales remained strong at $92 per ton for the year, though the euro zone crisis has created some perception of “market softness.”

Bumi produced 60 million tons of coal in 2010 at an average sales price of $77 per ton.

“Bumi is fully sold out for fiscal year 2011 and sees very strong growth in fiscal year 2012, and production expansion plans to exceed 100 million tons in 2014 are on track,” said Dileep, speaking in New York at Macquarie’s Asean Mining Forum held last Tuesday and Wednesday.

Bumi sold 45.7 million tons of coal in the first nine months of 2011, up 2 percent on the same period last year. The average selling price rose 32 percent to $94 a ton.

Dileep also said the company’s intention to cut interest charges by more than 50 percent by 2013 was on track as it prepares to repay $1.3 billion worth of debt to China Investment Corporation.

Bumi’s profit rose 17 percent and revenue climbed 34 percent in the first nine months of this year on higher production and a surge in prices.

The Jakarta-based company’s net income in the January-September period rose to $228.8 million from $195.5 million a year earlier.

Revenue surged to $2.86 billion from $2.13 billion. In the same period, production rose 10 percent to 47.2 million tons from 42.8 million tons a year earlier.