Semen Gresik relies on internal cash

Semen Gresik relies on internal cash
Published: 19 January 2009

PT Semen Gresik Tbk allocated internal cash worth IDR2.1-2.5 trillion to cover the US$371m capital expenditure in 2009.

As per September 2008, internal cash stood at IDR3.3 trillion allotted to cover the routine needs worth IDR1 trillion and the capital expenditure worth the rest.

President Director of Semen Gresik Dwi Sutjipto said the mounting use of internal cash is to minimise the financial crisis impact so that the management cut down the external loan as possible.

"The firm capital expenditure of 2008-2014 period stands at US$1.25bn consisting of debt allocation worth US$696 million and internal cash US$555 million," he said in the road show to Gresik yesterday.

The company has cut down the budget for the construction of steam-based power plant as from formerly US$570m into US$114m. "Initially we will develop 10 power plants but it was cut into two power plants with 2x35 MW capacities."

As from the total required funds of US$114m, some 30 per cent will be funded from internal cash and the remaining from bank or other loan instruments.

In public disclosure in November 2008, the company clarified the spending of Semen Gresik capital expenditure of the 2008-2014 periods was allotted for the plant capacity increase worth US$758m, power plant development, company restructuring worth US$40m, change cost and other cost worth US$161m.