By Romel S. Gurky
Central Kalimantan metallurgical coal producer PT Adaro Minerals Indonesia Tbk (IDX: ADMR) reported higher revenue and core earnings in fiscal year 2024, driven by a 30% surge in metallurgical coal production and a sharp increase in capital expenditure to support its infrastructure and aluminium smelter projects.
Revenue rose 6% to $1.15 billion, supported by a 26% increase in sales volume to 5.62 million tonnes, which helped offset a 16% decline in average selling prices. Operating income fell 6% to $540.3 million, while core earnings increased 6% to $445.4 million. The company posted an operational EBITDA of $580 million, up 1% year-on-year, with a solid EBITDA margin of 50.3%. Total assets grew 22% to $2.07 billion, while total equity surged 45% to $1.50 billion, reflecting a sharp rise in retained earnings. Interest-bearing debt dropped 30% to $295.8 million following repayments.
President Director and CEO Christian Ariano Rachmat said the company had delivered on its guidance despite price fluctuations, ensuring continued volume growth. "Our expansion is supported by solid profitability and a strong cash position. We continue executing on our strategic investments to support long-term growth," he said.
Metallurgical coal production rose to 6.63 million tonnes in 2024, marking a 30% increase from the previous year, while overburden removal surged 26% to 23.55 million bank cubic meters. The improved operational efficiency reduced the strip ratio to 3.55x from 3.66x in 2023. Domestic sales accounted for 32% of total volume, with Japan leading export sales at 29%, followed by China at 16% and South Korea at 14%.
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Adaro Minerals significantly ramped up capital expenditure to $405.7 million in 2024, more than tripling the prior year's spending, as it pushed forward with key infrastructure projects. Investments in mining operations included the completion of a 400-bed employee camp and additional fuel storage tanks in Tuhup and Lampunut. The company is finalizing the construction of a second barge loading conveyor with a 3,000 tonnes-per-hour capacity, aimed at accelerating coal shipments. A 39-km hauling road upgrade is underway, along with the construction of a new 500-bed employee camp in Lampunut.
The company is also advancing its downstream strategy with the construction of an aluminium smelter under PT Kalimantan Aluminium Industry (KAI). The smelter, located in North Kalimantan, is part of Adaro’s broader plan to diversify its revenue streams and support Indonesia’s push for industrial downstreaming. Once completed, the smelter will have an initial production capacity of 500,000 tonnes of aluminium per year, with potential expansion in later phases. The project is being developed in phases, with the first phase expected to achieve commercial operations by the end of 2025.
In 2024, Adaro completed the construction of the raw material berthing area at the jetty, which will facilitate material imports. Work continues on the foundation and steel structure for the anode and electrolysis plant, the installation of conveyor belt structures, and site office buildings. The company is also developing power and logistics infrastructure to support the smelter’s operations. The facility is expected to play a key role in Indonesia’s aluminium industry, reducing reliance on imports and creating a fully integrated supply chain for aluminium production.
For 2025, Adaro Minerals is targeting sales volumes between 5.6 million and 6.1 million tonnes, with a strip ratio of 3.3x. The company has set capital expenditure guidance at $300 million to $325 million, which includes further investments in the KAI aluminium smelter.
Below graph shows our sales destination in FY24
Editing by Alexander Ginting
