In this report, a description of the discussion and analysis of the Company's financial statements and other important information is provided, with an emphasis on material changes that have occurred.
Sales & Production
During 2023, the Company recorded net sales of Rp 437 billion, a decrease of 19% from 2022 where net sales were Rp 541 billion. Sales in 2023 were dominated by export sales to China and several other countries such as Chile, Philippines, Hong Kong, Spain and Vietnam at 98.65%. While domestic sales were 1.35%.
During 2023, the Company produce 3 types of seaweed, as follows:
1. Dried Eucheuma Cottoni Seaweed
This is a description of seaweed that can produce kappa carrageenan. Carrageenan is used as a thickening and stabilizing agent in ice cream, as a coating material for pharmaceutical capsules, as an adhesive substance, a filter in processed meat, widely used in animal food products, and to provide texture in beverages such as milk and beer.
2. Dried Eucheuma Spinosum Seaweed
This is a description of a type of seaweed that produces iota carrageenan, which is used as a raw material in the textile, cosmetic, and food industries.
3. Dried Gracilaria Seaweed
24 This is a description of a type of red algae used to produce agar and plays a role in the pharmaceutical industry as well as serving as a medium for the cultivation of certain bacteria.
The breakdown of sales as follows:
Collection, Packing & Distribution
Collection, Packing & Distribution processes as follows:
1. The Company purchases seaweed from suppliers who are members of supported farmers in the form of bales or sacks;
2. The seaweed is then transported to the Company's warehouse;
3. Quality tests are conducted to assess the moisture content and level of impurities;
4. The seaweed is sorted, with some requiring drying processes while others can be directly packed;
5. Drying or processing is carried out according to the standards specified in the contract received by the Company, within the Company's facilities that meet the processing eligibility certificate from the HACCP (Hazard Analysis and Critical Control Points) department of fisheries;
6. The seaweed is packed;
7. The packed seaweed is then shipped for export.
There are 2 (two) methods for determining the moisture content of seaweed, namely traditional method and oven method
Traditional Method:
1. Firstly, dried seaweed will release salt from its thallus.
2. Secondly, dried seaweed can also be identified by its physical changes. When wet, seaweed appears transparent, but when it is dried through the drying process, it becomes pale, wrinkled, and shrinks.
25 Raw Material
Collections
Water Content
Test Drying
Packaging Container Distribution 3. Thirdly, by cleaning the salt adhering to the seaweed until it is completely clean, then pressing
the seaweed between the thumb and forefinger. If the cleaned seaweed still feels sticky, it means that the moisture content inside the seaweed is still high.
Oven Method:
1. Use a sample weighing 200 grams, which will be weighed before the oven drying process.
2. Place the sample in an oven at a temperature of 105 degrees Celsius for a specific period of time.
3. After drying, weigh the sample again. The difference in weight will be calculated to determine the moisture content present.
Collection, Packing & Distribution processes Dried Eucheuma Cottoni Seaweed dan Dried Eucheuma Spinosum Seaweed.
Production Process Photos
26 Raw Materials & Suppliers
In selecting raw materials, the Company chooses high-quality raw materials to meet product standards.
Currently, the Company has suppliers from various regions in Indonesia such as East Nusa Tenggara (NTT), Makassar, Nunukan, Tarakan, Southeast Sulawesi, North Sulawesi, and Central Sulawesi.
Balance Sheet (Assets)
The Company's assets as of December 31, 2023 were Rp 197 billion, a decrease of 1% compared to December 31, 2022 of Rp 199 billion. Trade receivables as of December 31, 2023 were Rp 32 billion, a decrease of 11% compared to December 31, 2022 of Rp 36 billion. Trade receivables at the end of 2023 were dominated by receivables from export sales. The Company's management believes that all receivables will be collected, so no Allowance for Bad Debt was formed at the end of 2023. Inventory as of December 31, 2023 was Rp 86 billion, an increase of 36% compared to December 31, 2022 of Rp 63 billion. Advances on Purchases as of December 31, 2023 were Rp 16 billion, a decrease of 22%
compared to December 31, 2022 of Rp 20 billion. Net fixed assets are recognized at cost less accumulated depreciation. Net fixed assets for the last 3 (three) years have not changed, each being in the range of Rp 46 billion.
Balance Sheet (Liability & Equity)
Liabilities as of December 31, 2023 were Rp 89 billion, a decrease of 3% compared to December 31, 2022 of Rp 92 billion. Share capital has not increased for the last 3 (three) years. Equity as of December 31, 2023 was Rp 106.9 billion, an increase of 0.2% compared to December 31, 2022 of Rp 106.8 billion.
This shows that the decrease in the Company's assets was caused by a decrease in the amount of liabilities due to the payment of financing debt.
- 100.000 200.000 300.000 400.000 500.000
2021 2022 2023
Aset Liabilitas Ekuitas
27 Sales & Gross Profit
Sales in 2023 amounted to Rp 437 billion, a decrease of 19% compared to sales in 2022 of Rp 541 billion. The company's sales are dominated by export sales, which account for 98%. Cost of goods sold also decreased by 20%, or Rp 402 billion in 2023 compared to Rp 38 billion in 2022.
Operating Expense & Net Profit
Operating expenses in 2023 and 2022 were Rp 30 billion and Rp 36 billion, respectively. The largest portion of operating expenses was export and local transportation costs, which were Rp 21 billion and Rp 22 billion in 2023 and 2022, respectively. In 2023, the Company recorded a net profit of Rp 17 million.
Important Financial Ratio
Return on Asset (ROA) in 2023 was 0.01%, an increase compared to 2022 which was -0.97%. Return on Equity (ROE) in 2023 was 0.02%, an increase compared to 2022 which was -1.80%. The Company was able to maintain a positive profit so that the Net Profit Margin (NPM) increased to positive in 2023.
-100.000 0 100.000 200.000 300.000 400.000 500.000 600.000
2021 2022 2023
Penjualan Beban Pokok Penjualan
Laba Kotor Beban Usaha
Laba Sebelum Pajak Laba Bersih
2021 2022 2023
ROA 0,94% -0,97% 0,01%
ROE 1,55% -1,80% 0,02%
NPM 0,43% -0,36% 0,00%
Current Ratio 222,74% 180,50% 175,80%
Debt to Asset 0,39 0,46 0,46
Debt to Equity 0,65 0,86 0,84
28 Current Ratio in 2023 was 175.80%, down from 180.50% in 2022. The Company's ability to meet its current liabilities is still quite safe, although it has decreased.
Debt to Asset ratio in 2023 was stagnant at 0.46 times. Meanwhile, Debt to Equity ratio decreased slightly in 2023 to 0.84 times compared to 0.86 times in 2022.
Cash Flow
Cash and cash equivalents at the end of 2023 and 2022 were Rp 6.8 billion and Rp 25.9 billion, respectively. In 2023, cash receipts from customers amounted to Rp 435 billion, a decrease of 18%
from 2022 of Rp 530.8 billion.
Liability & Capital Stock
The Company's capital structure in 2023 consists of 41% short-term liabilities, 4% long-term liabilities, and 54% equity. The Company emphasizes an optimal combination of debt and equity to reduce the cost of capital. The management will pay close attention to the capital structure where even though the debt equity is quite high, it is used to make sustainable purchases of raw materials or for assets that are used to provide added value, besides the management will always choose the most efficient and safe option in payments.
Hedging
The company main business is in the export sector, so it engages in hedging whenever possible to ensure that all profits meet their targets.
Capital Goods Investment
The capital goods investment realized in 2023 included the purchase of machinery and equipment to add the production value of seaweed, which the demand of seaweed is constantly increasing.
Additionally, there were purchases of office inventory to support operational activities.
Business Prospect
In general, the prospects for seaweed cultivation business are very promising. This is related to the increasing demand for raw materials in modern industries that utilize seaweed, particularly in food processing, pharmaceuticals, textiles, and so on. According to data from the Central Statistics Agency (BPS), Indonesia exported seaweed and other algae around 231,829.70 tons valued at US$397.16 million in 2022. This figure increased by 12.44% compared to the previous year, which saw 206,185.10 tons exported with a value of US$222.61 million. The export figure reached its highest point in the last 5 years, as shown in the data below:
29
200,7 215,24
181,62 222,61
397,16
2018 2019 2020 2021 2022
Nilai (US$ Juta)
Source: Badan Pusat Statistik (BPS)
Based on data above, it can be concluded that there was a significant increase in exports following the COVID-19 pandemic that struck the world in 2020. Indonesia's seaweed exports in 2022 were distributed to 23 countries. China emerged as the primary destination for seaweed and other algae exports, with a volume of 194,115.41 tons valued at US$335.83 million. This serves as a positive signal for the company's business prospects.
The Indonesian government continues to support this by developing downstream programs for both large-scale industries and small and medium enterprises (SMEs). These efforts are seen to have a positive impact on the national economy, increasing value-added and export value. Seaweed, initially exported in raw form or as raw material, is now being developed into semi-finished or finished products, thereby increasing its market value. In this regard, the company is committed to developing processed seaweed products, including SRC Semi Refined Carrageenan, which is a seaweed-based product in powder form used in the food and pharmaceutical industries. This product will be produced by the company's subsidiary, PT Giwang Citra Laut (GCL).
Marketing Aspect
Market Strategy & Market Share
• Maintaining product quality consistently to uphold the company's reputation.
• Expanding into international markets by seeking business opportunities for the company's subsidiary commodities.
•
Business Plan 2024
The Company targets a 10% increase in sales volume in the Annual Business Plan for 2024 compared to 2023. The sales volume increase in 2023 was 18% compared to 2022. With this sales growth, it is hoped that the company's profit margin will improve.
192,84 191,2 177,97 206,19 231,83
2018 2019 2020 2021 2022
Volume (Ribu Ton)
30 Dividen Policy
As a Public Company that aims to create value for all shareholders, the Company has a policy of providing all shareholders with the right to cash dividends at least once a year. Without prejudice to the rights of the General Meeting of Shareholders (GMS), the decision on the amount of dividends always considers several aspects, namely the amount of the Company's net profit, the Company's financial condition, and the need for capital for business development. In the last 2 years (2022 and 2021), the Company has not paid cash dividends.