Wika secures new contracts worth Rp5.54tn

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.

Investor Daily - Wika Kantongi Kontrak Baru Rp5,54 T

31 May 2021

By: Muawwan Daelami

 

Jakarta – PT Wijaya Karya Tbk (WIKA) has secured new contracts worth Rp5.54 trillion until April 2024. These contracts increased the company’s order book Rp77.13 trillion.

Wijaya Karya (Wika) President Director, Budi Waskito, explained that most of the new contracts came from infrastructure projects, such as Jatiluhur Drinking Water Supply System (SPAM), Mandalika area infrastructure construction, as well as construction of Indonesian Army (TNI AD) official residences in 35 locations across Indonesia. Next, the new contracts also came from industrial, energy, industrial plant, and property sectors.

Meanwhile, until the first quarter of 2021, the company posted a net profit of Rp78.16 billion, which decreased by 20.54% compared to the net profit in the first quarter of 2020 that reached Rp99.12 billion. Net profit from sales reached Rp3.92 trillion. Sales also declined by 6.66% compared to sales in the first quarter of 2020 that reached Rp4.2 trillion.

Agung revealed that this achievement would be the company’s supply to maintain Wika’s production in the future. Its management has also arranged various strategies to maintain business sustainability.

“We believe that the key to maintain [the performance of] the company is to ensure the health of employees to remain productive. The company is also focusing on its financial condition by periodically monitoring its cashflow and being more efficient,” Agung explained in his written statement last week.

Moreover, during the Annual Shareholders Meeting (RUPST), Wika decided to not distribute dividends. From their Rp185.76 billion net profit in 2020, around Rp122.76 billion is set as reserve. The remaining Rp63 billion will be used pay for the perpetual bonds issued in 2018.

Based on the annual report of Indonesia Stock Exchange (IDX), Wika is setting their new contract target to grow 20% every year from 2021. The new contract growth is expected to boost sales and net profit by 20%.

Meanwhile, PT Wijaya Karya Beton Tbk (WTON), Wika’s subsidiary, is targeting their sales to reach Rp7.38 trillion this year. This target forecast is due to the company being optimistic about their positive performance last year despite the Covid-19 pandemic.

Wika Beton is also targeting their net profit this year to reach Rp370.95 billion and to secure new contracts worth Rp8.02 trillion. The 2021 target will be observed further based on the economic development this year.

Last year, the company survived and recorded sales of Rp4.8 trillion, which is 96.34% of the revised 2020 RKAP that reached Rp4.9 trillion. Meanwhile, the company’s net profit reached Rp123.15 billion, which is 114.98% of the revised 2020 RKAP that reached Rp107 billion.

Amid the challenging condition, the company’s cash flow from operation reached Rp802.86 billion. Moreover, cash flow from investment activities reached Rp281.52 billion and from funding activity reached Rp581.41 billion. Hence, the company’s net cash at the end of 2020 reached Rp1.54 trillion.

Several major projects that contributed to the new contracts until December 2020 were dominated by projects in the infrastructure sector that reached 72.87%, followed by projects in the energy sector that reached 12.26%, then projects from property, mining, and industrial sectors that reached 8.84%, 4.97%, and 1.07% respectively.

The projects are Jakarta-Bandung High-Speed Railway, RKEF Nickel Smelter, Patimban Dock, RDMP Balikpapan, Fibre-Optic Cable Route Construction in Semarang, Kijing Terminal, Indrapura-Kisaran toll road, Bogowonto River Flood Control, Tebing Tinggi-Parapat toll road, and Jakarta International Stadium.

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