JAKARTA, RAKYAT NEWS – The giant mining PT Bayan Resources Tbk (BYAN), a major coal mining company owned by conglomerate Low Tuck Kwong, has secured a credit facility amounting to $125 million (around IDR 2 trillion) from Bank Mega.

This loan will be used for the company’s working capital and operational activities. The loan agreement was signed on December 13, 2024, and includes both a demand loan facility and a sublimit for Bank Guarantees/Standby Letters of Credit, with the latter totaling $25 million.

The loan, with a term of 36 months, is secured by company guarantees provided by PT Bara Tabang, a subsidiary of Bayan Resources. This financing arrangement will support the company’s operations and those of its subsidiaries, ensuring the necessary capital for continued business activities.

In its official statement, Bayan Resources confirmed that the loan does not have a material impact on the company’s operations and is part of its efforts to strengthen its financial position despite recent challenges. The company’s financial performance has been under pressure, as evidenced by a 48% drop in its net income during the first half of 2024, amounting to $376.76 million compared to $725.85 million in the same period in 2023.

Additionally, Bayan’s revenues for the first half of 2024 decreased by 25%, totaling $1.53 billion, compared to $2.03 billion in the previous year. Sales to third-party buyers were down by 27%, while sales to related parties saw a 25% increase. The company has been working to navigate through these financial difficulties, leveraging the credit facility to ensure that its operations continue smoothly.

This loan agreement underscores Bayan Resources’ commitment to maintaining a strong financial structure while facing market fluctuations. The company has also been preparing to distribute a large dividend of IDR 4.75 trillion as part of its ongoing efforts to support its investors and stakeholders.

In addition to its mining operations, Bayan Resources has been expanding its portfolio. The company recently acquired a palm oil plantation worth IDR 105.14 billion near its mining sites, diversifying its business activities. This move is seen as part of Bayan’s strategy to explore new revenue streams and reduce its dependency on the volatile coal market.

As Bayan continues to face financial and market challenges, the company remains focused on operational efficiency and securing necessary capital to sustain growth. This loan agreement is a critical step in ensuring the company’s financial stability in the coming years, allowing it to remain competitive in a challenging business environment.

Looking ahead, Bayan Resources is also exploring opportunities to improve its financial and operational performance. The company’s management is optimistic that the support from Bank Mega, combined with strategic investments, will help it navigate through this difficult period and emerge stronger in the long term. (Uki Ruknuddin)

 

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