Jakarta, CNBC Indonesia – Minister of State-Owned Enterprises (BUMN) Erick Thohir appreciated the performance of PT Krakatau Steel Tbk (KRAS) which managed to record a net profit of Rp 1.06 trillion as of November 30, 2021. This achievement can be obtained by the company after conducting financial and business restructuring.
This was conveyed by Erick in his upload on his Instagram account @erickthohir.
“Krakatau Steel until the end of 2021 has successfully carried out restructuring and transformation. Until November 2021, the company managed to record a profit of Rp 1.06 trillion. In addition, the company recorded a record production of HRC and CRC which proves to be more efficient and competitive,” Erick wrote in his upload. quoted Thursday (6/1/2022).
In addition to improving financial performance, the company also managed to record the highest production in the company’s history, reaching 80,032 tons.
Krakatau Steel also added production capacity for factories hot strip mill (HSM) 2 with a capacity of 1.5 million tons.
“The transformation and restructuring of Krakatau Steel will continue to improve performance, for Krakatau Steel to be tough,” he said.
This compliment was conveyed by Erick after previously in December 2021 he said there was a possibility that this steel company could default or go bankrupt. Thus, KRAS needs to carry out a number of restructuring steps.
He explained that there were 3 restructuring steps for Krakatau Steel. If these three steps don’t work, Krakatau Steel will go bankrupt.
“There are three restructuring steps, the problem is that the third step is stuck,” said Erik in a Working Meeting with Commission VI DPR RI.
Erick said that there used to be an investment in Krakatau Steel in manufacturing factories blast furnace for US$ 850 million in 2008. However, this project stalled, and provided no benefits. There was hope that this project would be taken over by China but failed.
“This item no can what’s wrong, there was hope that there would be a technology for making steel from iron sand and the price could be competitive from the existing process. Yesterday there was also a discussion with Chinese partners they want to take over blast furnace this,” he said.
“They wanted to completely fix it and had time to add money but it was canceled because the price of steel went up so they could build the factory twice. This is the reason they backed out,” he said.
Then the second step is being taken regarding work negotiations with one of the steel companies Posco as the largest shareholder of KRAS, with a 70% portion.
The final step is the possibility of the Investment Management Institute (LPI) or the Indonesia Investment Authority (INA) to invest in Krakatau Steel.
“This is crucial if the third fails, the second fails, the first fails, then this December (Krakatau Steel) could default,” he said.
(mon / dhf)
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