Indonesia Companies Gripped by Virus Warn Earnings May Fall 75%

(Bloomberg) -- Indonesian companies are warning investors to brace for yet another quarter of missed earnings as they continue to reel from the economic impact of the biggest outbreak of the coronavirus in Southeast Asia.

The pandemic has hurt sales, from cigarettes to cars and luxury condos, in Southeast Asia’s largest economy after social distancing measures were introduced in March to contain the virus. Companies are now warning of a plunge in profit and revenue between 25% and 75% in the first half after more than 600 firms making up the Jakarta Composite Index of stocks saw earnings tumble 42% in the first quarter, the worst since the final quarter of 2018.

Conglomerate PT Astra International and state miner PT Aneka Tambang said the mobility restrictions hurt their operations, while cigarette maker PT Gudang Garam suffered lower sales as purchasing power dropped. Indonesia now has the most Covid-19 cases and fatalities in Southeast Asia, prompting the government to form a special panel to lead efforts to contain the outbreak.

Here’s a roundup of profit and revenue warnings from Indonesian companies and steps they are taking to minimize the hit from the pandemic:

Astra International

With a bulk of its business coming from vehicle sales, Astra expects its net income to decline 25%-50% in the first half, excluding one-time gains. It also expects revenue to fall less than 25% as automobile sales plunge. The company, majority-owned by Jardine Cycle & Carriage Ltd., is conserving cash and securing credit lines, it said in a statement.

Waskita Karya

The state builder’s first-half net income may plunge more than 75% and revenue is seen sliding between 51% and 75% due to limited operations in areas with high infections. The company extended the tenor of 2.75 trillion rupiah ($188 million) of short-term debt, it said in an exchange filing this week.

Bukit Asam

The coal miner projects net income to slide 25%-50% and revenue to drop as much as 25% in the first half. The state-owned company may also lower this year’s coal output target from 30.3 million tons if prices continue to fall, it said on July 14.

Bank Tabungan Negara

The state lender expects its net income to drop 25%-50% in the first six months and revenue to fall less than 25%.

Blue Bird

The nation’s biggest taxi operator, which was forced to limit its operations following social distancing curbs, is warning of a more than 75% slump in first-half profit with revenue declining between 25% and 50%. Blue Bird is in talks with creditors to relax terms for repayment of 484.6 billion rupiah of short-term debt.

Gudang Garam

The cigarette producer expects net income and revenue to fall less than 25% in the five months through May due to lower sales, higher excise tax and weakening of people’s purchasing power.

Agung Podomoro Land

The builder of high-end condominiums and shopping malls forecasts a more than 75% decline in net income and less than 25% drop in revenue in the five months ended May. While the developer has resumed operations at its shopping centers, it’s cutting promotional and marketing costs to deal with the blow from the pandemic.

Aneka Tambang

The state miner expects its net income and revenue to decline as much as 25% in the five months through May after the virus outbreak limited its operations. Aneka Tambang is targeting an improvement in profit margin in its nickel segment this year and is taking steps to reduce operational costs.

PT PP

The state construction company was forced to temporarily suspend some projects while work on some others were slowed by the pandemic. It expects net income to dive more than 75% in the January-May period and revenue to drop as much as 50%. Its ability to repay short-term debt of 1.63 trillion rupiah is impacted as well, it said in a filing.

Bank Central Asia

Indonesia’s largest lender by market value forecasts net income and revenue to fall less than 25% in the five months through May as it adjusted some of its operations due to the virus outbreak.

Surya Citra Media

The operator of two free-to-air television services and content producer projects 25%-50% decline in net income for the January-May period and less than 25% drop in revenue. It’s slashing operational costs and maximizing collaborations with within its group to maintain businesses, it said in a statement.

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