Waskita Karya Eyes Rp 70t in New Contracts; Plans to Divest Toll Roads

President Joko 'Jokowi' Widodo, center, Public Works Minister Basuki Hadimuljono, left, and State-Owned Enterprises Minister Rini Soemarno inspect a section of the new Bekasi-Cawang-Kampung Melayu Toll Road on Nov. 7. (Antara Photo/Yudhi Mahatma)

By : Lona Olivia & Sarah Yuniarni | on 10:44 AM December 19, 2017
Category : Business, Corporate News

Jakarta. State-controlled construction firm Waskita Karya eyes Rp 70 trillion ($5.2 billion) worth of new contracts next year on the back of new infrastructure projects across the archipelago.

That would be a 28 percent increase from this year's target of Rp 60 trillion, thanks to new projects in 2018, including the Jakarta light rail transit system, railway lines and projects from Waskita Beton Precast, its concrete-producer subsidiary.

Waskita only booked Rp 44.5 trillion in new contracts in the January-September period this year, down 24.5 percent compared with the corresponding period last year.

The company has also set a net profit target of Rp 5.3 trillion for next year – 32.5 percent higher than this year's projection.

"We are optimistic of achieving a positive performance in 2018 as Waskita will receive payments from several near-completion turnkey projects next year, especially from the Palembang LRT [in South Sumatra] and toll road projects," Waskita Karya president director M. Choliq said on Monday (18/12).

Choliq said Waskita's cash flow would improve in 2018 as the company expects to receive Rp 30 trillion from the Palembang LRT project in the first half of the year.

Waskita Karya reported negative operating cash flow of around Rp 5.08 trillion in the first nine months of this year, which was an improvement from the Rp 9 trillion in negative cash flow in the corresponding period last year.

Meanwhile, the company also plans to divest its 18 toll road segments in Java and Sumatra, operated by its subsidiary Waskita Toll Road, to prospective investors under three schemes.

As part of the first scheme, the company will sell all its toll roads, with a few undisclosed investors especially eying the new 8.26-kilometer Bekasi-Cawang-Kampung Melayu Toll Road, which connects Jakarta and Bekasi in West Java.

The second option involves the sale of parts or half of its 18 toll roads, with state-controlled toll operator Jasa Marga and Astratel Nusantara, the infrastructure unit of conglomerate Astra International, having expressed interest.

The third option is the sale of a chunk of its stake in Waskita Toll Road to the Islamic Development Bank, oil and gas giant Saudi Aramco, Malaysian sovereign wealth fund Khazanah, or several to undisclosed Chinese investors.

"All of the divestment options will potentially secure us funds of around Rp 4 trillion," Choliq said.

The company also plans to increase its toll road segments to around 584 kilometers next year, from 279 kilometers this year.

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