Jakarta. State-owned plantation holding Perkebunan Nusantara PTPN III recently announced that it booked a consolidated profit of Rp 4.64 trillion, or about $323 million, in 2021.

This marks an increase of 500 percent or Rp 5.73 trillion compared to the company’s profit in 2020. At the time, PTPN Group suffered a loss of Rp 1.14 trillion.

PTPN attributed this growth to the transformation program that the company had been doing in the past two years.

"The transformation efforts of PTPN have been successful, with a positive impact on PTPN Group's financial performance in 2021," Perkebunan Nusantara PTPN III president director Mohammad Abdul Ghani said in a recent press statement.

According to Ghani, the revenue growth boosted the company's net profit. The company recorded a revenue of Rp 53.57 trillion in 2021, up by 36 percent from Rp 39.39 trillion in 2020.

Earnings before interest, taxes, depreciation, and amortization (Ebitda) stood at Rp 14.18 trillion in 2021, marking a 206.69 percent increase compared to the previous year and 124.26 percent above the budget in 2021.

"We will continue to spur business revenue growth, through improvement of the company's production and productivity, as well as through operational optimization both in upstream and downstream fields," Ghani said.

Among others by improving the sugar land area productivity and revitalizing sugar mills through its subsidiary Sinergi Gula Nusantara (SGN).

Ghani added that among the transformation efforts that PTPN Group had done was changing the company from a strategic holding to an operating holding. Digital transformation was also in place for better efficiency and effectiveness.

The company also lowers its short-term liabilities via debt restructuring programs to the banks. The total short-term liabilities dropped from Rp 38.19 trillion in 2020 to Rp 20.03 trillion last year — thus enabling the management to expand business, improve cash flow and provide space for companies to increase their capital expenditures.

In the second quarter of 2021, PTPN  launched the Ebitda transformation program, which encompasses revenue enhancement, organizational excellence, zero based budgeting, logistic optimization, procurement excellence, among others. As well as operations control tower, cash office, management review cycle, and strategic transformation office program, according to Ghani.

PTPN also enjoyed an increase in production.

Its oil palm fresh fruit bunches (FFB) production reached 12.47 million tons in 2021, rising 13.36 percent from the previous year. PTPN also reported an increase in crude palm oil (CPO) production of 2.68 million tons, or 12.57 percent compared to 2020.  

FFB and CPO productivity jumped to 21.07 tons/ha and 4.83 tons/ha respectively, or at a rate of 7.18 and 7.51 percent from the 2020 figures. The cost price of palm oil commodities also dropped from Rp 4,161/kg to Rp 3,956/kg.

PTPN’s average CPO selling price in 2021 stood at Rp 11,293/kg, a significant leap from Rp 8,521/kg in the previous year.

In 2021, PTPN produced 171 thousand tons of rubber, rising 7.21 percent compared to the previous year. Sugar production in 2021 amounted to 768.6 thousand tons or an increase of 9.42 percent from the previous year, according to PTPN.

"We will continue to transform and strive to improve performance through various strategic initiatives and other corporate actions, such as listing on the stock exchange at the end of this year,” Ghani said.

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