SG profit to fall ‘if Tuban factories disposed’ Indonesia

SG profit to fall ‘if Tuban factories disposed’ Indonesia
Published: 08 February 2005

The net profit of publicly listed PT Semen Gresik Tbk (SG) is going to fall if the company’s Tuban 1, 2, and 3 factories are sold since 80 percent of the company’s profit is contributed by the three factories.   President Director of SG Satryo said that with the net profit declining, SG’s contribution to the government would also be greatly reduced.  

"Even worse, we may lose the brand image and market network that we have built for years," he informed in a meeting with the House Commission VI.  

The disposal of Tuban 1, 2, and 3 factories is one alternative scheme that has been being talked by the government and Cemex Asia to settle their long dispute. The scheme stipulates that the three factories will be sold to Cemex and the funds generated from the disposal would be used to build new cement factories with the production capacities between 2.5-3Mt.  In the meantime, Semen Gresik Labor Union has rejected the plan. The union prefers the new cement factories to still carry SG brand.