"In principle, the shareholder (the state enterprises ministry) has agreed on KAI`s plan to issue bonds in 2018," PT KAI President Director Edi Sukmoro said after attending a general meeting of the company`s shareholders at the State Enterprises Ministry building here on Wednesday.
PT KAI`s plan to issue bonds has received a seal of approval. Now the company only has to send other written qualifications to relevant agencies, including the use of funds from the issuance of the bonds, he said.
In November 2017, PT KAI also issued bonds worth Rp2 trillion. But because of its high fund needs, the company plans to issue another bonds.
PT KAI is expected to use proceeds from the issuance of the Rp2 trillion bonds to procure/rejuvenate its trains.
Most of the train cars are more than 30 years old so that they must be replaced, he said.
The company has set the target of its net profit for 2018 at Rp1.7 trillion, up 21.4 percent from its 2017 profit prognosis of Rp1.4 trillion.
The company has projected its income this year to increase to Rp21 trillion, higher than its income forecast of Rp17 trillion last year, Sukmoro said.
"The 21.4 percent profit hike is very good. It is high in view of the fact that KAI is a public service company rather than pure business company. It means that its profit must be returned to its service," he added.
Reported by Royke Sinaga