Krakatau Steel’s operating loss swells to $59 million

Krakatau Steel, Indonesia’s state-owned steelmaker, saw its operating loss balloon to $59 million for the first nine months of 2014 on lower revenue.

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This compares with an operating profit of $8.2 million over the same period last year, the steelmaker said in a filing to the Indonesia Stock Exchange (IDX) on October 29. It recorded an operating loss of $30.13 million in the first half of this year.

Krakatau’s net sales for the January-September period fell 13.4% year-on-year to $1.36 billion. The steelmaker did not provide a breakdown of its quarterly financial results or notes explaining its performance.

A spokesman, however, confirmed to Steel First last month that the steelmaker had embarked on a cost-cutting exercise, which included reducing the scope of work that has been outsourced to other companies and removing some managerial positions.

The restructuring came amid continuous losses, which was compounded by increases in electricity tariffs, gas prices and minimum wage.