Semen Indonesia's profit may ease this year

Semen Indonesia expects its net profit to drop this year as slowing demand and rising costs put pressure on the company's margin.

"We expect revenue to be maintained [at the same level as last year's]. However, our EBITDA margin might be squeezed by around three per cent and our profit might be lower by about two per cent," Semen Indonesia president director Suparni told the Jakarta Post.

Suparni told reporters on Tuesday that while he was upbeat infrastructure projects would progress in the second half and demand would increase to balance slow sales in the first half, rising costs would trim its bottom line as annual sales volume was expected to remain flat this year.

Domestic sales slipped by 5.9 per cent YoY to 12.2Mt as of August, according to Suparni. In the first six months, net profit contracted 20.63 per cent YoY to IDR2.18trn (US$161.5m). Revenues dropped 1.9 per cent to IDR12.64trn from IDR12.88trn a year earlier.