Message From CEO
Our Valued Shareholders,
On behalf of the Board of Commissioners allow me to convey our appreciation to the Board of Directors and Management for their success in undertaking their roles and responsibilities in managing the Company.
In 2005, the Board of Commissioners closely monitored and kept its supervisory control over the management, and gave direction in formulating the Company’s values, vision, mission, policy, and budget.
The Commissioners draw on the expertise of its Audit Committee, which has been enhanced to ensure adequate internal control and risk management measures in order to safeguard the Company’s assets as well as long-term stakeholder value creation.
In general we conclude that the Board of Directors and Management have managed the Company in accordance with sound and prudent financial and operational management to achieve the Company’s objectives in line with the business plan and strategy that have been agreed upon.
The Company achieved a net profit of Rp1.22 trillion in 2005, an increase of 13.21% from Rp1.8 trillion in 2004. The Company’s earnings per share in 2005 rose by Rp7.35 to Rp62.98 (13.21%) compared to Rp55.63 in 2004, whereas return on assets and return on equities in 2005 were relatively high, reaching 7.43% and 66.09%, respectively, compared to 7.76% and 117.05% in 2004.
Another key achievement by the Company was the issuance of a seven-year structured export notes amounting to US$600 million with an interest rate of 7.134% per annum. An achievement that we can look up to, for the fact that it was the first transaction of its kind by an Indonesian company in post economic crisis of 1998.
A number of recognitions at national and international levels were received by the Company in 2005, including awards in corporate social responsibility, work safety, environment and the capital markets. This is tangible proof of the Company’s concern and responsibility over various social, environmental and economical programs.
The year 2005 was noted for the designation of PT Arutmin Indonesia by the government of Indonesia as a National Vital Object, that merit state protection, as was the case with PT Kaltim Prima Coal.
We regard the completion of the shares divestment of PT Kaltim Prima Coal as something that is very important towards the performance improvement of our subsidiaries as well as our overall operations.
However, the Board of Directors and Management should increase their awareness over the overlapping perimeters of PT Arutmin Indonesia mine concessions, in addition to prevailing special regional regulations pertaining to excise fees which contravene with the CCOW and may have an impact on the Company’ operations. It is our hope that both the Board of Directors and the Management of the Company will give their attention on the matter and engage both the central and regional governments in constructive dialogues to fi nd the best solution for all parties.
BUMI Resources remains committed to implement Good Corporate Governance simultaneously with its subsidiaries. In 2005, we engaged a management consultant to undertake the policies of corporate governance and Code of Conduct that are in line with national and international standards. The socialisation and implementation of GCG and Code of Conduct in the Company and its subsidiaries have been designed to be carried out on an annual basis.
With the increasing price of crude oil as a primary source of energy, businesses will seek out alternative energy sources. This represents a challenge and opportunity for BUMI Resources to try to innovate and create alternative forms of energy for industries in Indonesia and other parts of the world.
Moving forward, the Company is expected to continue to search for alternative financing both at home and abroad that will be used for our business expansion in the mining and energy sector.
The Board of Commissioners has reviewed the report of the Board of Directors as well as the Balance Sheet and Income Statement for the ended 31 December 2005 which has been audited by the public accounting fi rm of Jimmy Budhi & Rekan, members of Moores and Rowland International. As such we recommend their approval by shareholders and that the Directors are given Aquitte a Decharge for the management of the Company, and to the Board of Commissioners for its oversight.
Finally, we express our gratitude to the shareholders who have placed their trust in us to supervise the Company. We also convey our highest appreciation to all employees and other stakeholders for their dedication, hard work, trust and support to the Company all this time.
May we continue to achieve more successes in the future.
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