Construction SOE's performance: Signs of PTPP Group's recovery
This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.
Bisnis Indonesia - Kinerja BUMN karya: Geliat pemulihan Grup PTPP
9 March 2023
Jakarta - PT PP (Persero) Tbk (PTPP) logged revenue growth in 2022. However, the potential to continue recovering this year is still full of challenges.
In their 2022 financial report, PTPP logged a revenue of Rp28.92 trillion. Their revenue increased by 12.87% from Rp16.73 trillion in 2021.
Meanwhile, two of PTPP’s subsidiaries also achieved a revenue increase last year. For example, PT PP Presisi Tbk (PPRE) achieved a revenue increase of 29.49% year-on-year (YoY) from Rp2.8 trillion in 2021 to Rp3.63 trillion in 2022.
A higher business revenue increase was achieved by PT PP Properti Tbk (PPRO). In 2022, PPRO acquired a business revenue of Rp1.7 trillion, which increased by 97.65% from Rp862.46 billion last year.
Despite the positive revenue performance, not all issuers of PP Group achieved net profit increase. One of the reasons is PTPP’s cost of revenue that increased by 11.35% YoY from Rp14.58 trillion in 2021 to Rp16.24 trillion in 2022.
In 2022, PTPP increased their current year profit that is attributable to the parent company owner by 2.15% YoY from Rp265.97 billion to Rp271.69 billion in 2022.
Meanwhile, the profitability of PPRO and PPRE logged different directions. PPRO’s net profit slightly declined by 2.01% annually from Rp20.35 billion to Rp19.94 billion.
On the contrary, PPRE’s net profit increased to Rp100.75 billion or by 30.96% YoY from Rp76.93 billion in 2021.
According to Bisnis’ records, PTPP Corporate Secretary Bakhtiyar Effendi said that PTPP’s new contract value growth is forecasted to continue in 2023 with a growth target of around 10% to 11%.
According to him, PTPP is targeting new contract growth in infrastructure, building, engineering, procurement, and construction (EPC), as well as subsidiary segments. In detail, the EPC segment is set to increase by 11%, the infrastructure segment by 7%, the building segment by 5%, and the subsidiary segment by 3%.
In 2023, PTPP is preparing a capital expenditure (capex) of Rp3.43 trillion.
On the subsidiary level, PP Presisi President Director Rully Noviandar revealed that PPRE and its subsidiaries secured new contracts worth Rp5.24 trillion in 2022. The mining service sector dominated contract achievement last year.
Moreover, PPRE Independent Commissioner Nur Rochmad said that the company’s revenue growth forecast in 2023 increased by around 20%-25% YoY.
“The main strategy is to improve the company’s asset management to increase its market capitalisation in civil works as a main contractor and to improve the mining service business line with a wider service range to include mining road construction, jetty construction, stockpile construction, mining operation, and hauling service for mining products,” he said at the extraordinary general meeting (EGM) on Wednesday (22/2).
Moreover, PPRE is focusing to expand their mining commodities in 2023 to include nickel, coal, gold, and bauxite. Meanwhile, for the civil work business line, the company will focus on acquiring contracts that are funded by the state budget (APBN) and national strategic projects as a main contractor.
Phintraco Sekuritas Analyst Rio Febrian said that the Covid-19 pandemic that is currently relatively under control is opening a space for the government to accelerate infrastructure construction, which includes national strategic projects and Nusantara Capital City (IKN) development.
“IKN and the election in 2024 have the potential to increase new contracts for construction issuers, which are predicted to log financial performance growth,” he stated.
