KONTAN.CO.ID – JAKARTA. PT Kabelindo Murni Tbk (KBLM) revealed that the company’s losses last year were due to soaring raw material prices. The basic materials for cable production, namely Aluminum and Copper, experienced a significant increase.
“The cause of the sales loss in 2021 was a significant increase in copper and aluminum that could not be offset by the selling price. So it had a negative impact on gross profit,” said Kabelindo Murni Director Andika Saputra Wongkar in a virtual public presentation, Wednesday (8/6).
Andika said that the increase in prices can be seen in the price of copper which reached US$ 9,300/ton in 2021, a significant increase from 2020 which was US$ 9,000/ton.
As is known, last year KBLM was only able to record sales of Rp 1.21 trillion from the targeted sales of Rp 1.5 trillion. As a result, the company recorded a net loss of Rp 13 billion last year.
However, this year the company considers that the adjustment of selling prices can be done. Andika said, the step of adjusting the selling price of the product is to overcome the soaring price of raw materials due to the high inflation that is currently occurring.
“In 2022, we have been able to adjust the selling price. It is proven that in the first quarter of this year, we have recorded a net profit that has increased significantly from a loss. Sales were recorded at IDR 473 billion,” added Andika.
However, KBLM did not reveal how much the increase in selling price was. What is clear, Andika continued, is that the company will increase efficiency in selecting raw materials and implement a strategy to adjust selling prices for raw materials.
Contacted separately, the General Chair of the Indonesian Electrical Cable Manufacturers Association (Apkabel) Noval Jamalullail confirmed that the cable industry was under pressure from rising raw material prices.
“Clearly, there is pressure on the cable industry because the price of metal materials and the like which are the basic materials for cable production has risen sharply,” Noval told Kontan, Wednesday (8/6).
Noval added, imported materials are also now expensive and hard to get. This is none other than because of the war conditions between Russia and Ukraine which have affected the industry globally, and have caused cable prices to rise.
Moreover, the cable industry cannot simply work around the spike in raw material prices by reducing the size of the cable capacity. Noval said, because the cable industry already has agreed standards, the cable product cannot be reduced in size or voltage.
According to him, the only thing that cable manufacturers can do to overcome the high prices of aluminum and copper is to increase the selling price of the product and renegotiate the selling price .