In the Chief Commissioner’s Report, you will find information related to accountability and oversight of the company’s operations.
In the midst of a global economic slowdown and uncertainty, Indonesia’s economy continued to grow robustly and remained stable. Despite starting from a high base in 2022, where domestic economic growth reached 5.31%, Indonesia achieved a growth rate of 5.05% in 2023. Amidst the global economic slowdown, Indonesia demonstrated consistent growth trends, supported by strong domestic demand activities, particularly in consumption and investment.
Despite facing challenges such as intense competition, commodity and energy price volatility, and market overcapacity, the Company has managed to maintain performance growth through the implementation of efficiency and continuous innovation. This has minimized the increase in operational costs and improved profitability. The Company’s commitment to sustainable development principles is integrated into all operational activities, focusing on the development of sustainable solutions, efficient environmental management, the implementation of a circular economy, social responsibility, and human resource development.
In the midst of a global economic slowdown and uncertainty, Indonesia’s economy continued to grow robustly and remained stable. Despite starting from a high base in 2022, where domestic economic growth reached 5.31%, Indonesia achieved a growth rate of 5.05% in 2023. Amidst the global economic slowdown, Indonesia demonstrated consistent growth trends, supported by strong domestic demand activities, particularly in consumption and investment.
Despite facing challenges such as intense competition, commodity and energy price volatility, and market overcapacity, the Company has managed to maintain performance growth through the implementation of efficiency and continuous innovation. This has minimized the increase in operational costs and improved profitability. The Company’s commitment to sustainable development principles is integrated into all operational activities, focusing on the development of sustainable solutions, efficient environmental management, the implementation of a circular economy, social responsibility, and human resource development.
Performance Journey
The Company recorded revenue of Rp12.37 trillion, representing a 0.89% increase compared to Rp12.26 trillion in 2022. Revenue sources included contributions from cement (89%), ready mix concrete (10%), other construction services (1%) and aggregate (1%). Revenue growth was observed across all segments. Cement sales increased by 0.25% from Rp10.93 trillion in 2022 to Rp10.96 trillion, ready mix concrete rose by 4.53% from Rp1.17 trillion to Rp1.22 trillion, other construction services up 6.75% from Rp90.3 billion to Rp96.4 billion and aggregate surged by 31.33% from Rp72.3 billion to Rp95.0 billion.
Net profit increased by 6.60%, rising from Rp839.0 billion in the previous year to Rp894.6 billion. This performance was accompanied by a growth in total assets of 3.87% to Rp22.21 trillion, liabilities increased by 1.93% to Rp9.70 trillion and equity rose by 5.43% to Rp12.50 trillion. Total sales volume of cement and clinker reached 13.86 million tons, increasing 3.66% from 13.37 million tons in 2022 resulted from domestic sales of 12.35 million tons and exports of 1.51 million tons. The contribution from infrastructure development in Java Island was evident in the ready mix concrete (RMX) and aggregate business segments. The volume of RMX sales reached 1.53 million m3, a 1.69% decrease from 1.56 million m3 in 2022. Meanwhile, the total volume of aggregate sales amounted to 0.86 million tons, experiencing 24.84% increase from 0.69 million tons in 2022.
Business Strategy Initiative 2023
The Company also leveraged the domestic market by channeling cement through the ready mix concrete business unit to provide value-added and environmentally friendly construction solutions. In 2023, more than 40% of revenue was generated from sustainable solutions, such as SpeedCrete and environmentally friendly cement used in infrastructure projects.
The waste management segment managed by waste management business unit, Nathabumi, saw significant growth in 2023. The number of Nathabumi’s clients increased from 696 companies in 2022 to 782 companies. Moreover, Waste Management Unit (UPL) processed a total waste volume of 791.254 MT in 2023, marking a 1.0% increase from 799,318 MT processed in 2022. This resulted in a gross added value of Rp317 billion, down 2.5% from Rp324 billion in 2022.
The Company has formed partnerships with various local governments and private entities to handle urban waste and to convert it into alternative fuel for cement production across its plants. The government has acknowledged the Company’s efforts to address urban waste issues. Notably, the Ministry of Environment and Forestry (KLHK) invited SBI’s CEO to discuss the cement industry’s role in tackling urban waste issues through RDF utilization with co-processing system during a themed talk show titled “Zero Waste and Zero Emission Goals on Municipal Solid Waste” at the Indonesian Pavilion during COP28 UNFCCC UAE Dubai. COP28 Dubai is a global conference focused on accelerating climate change initiatives.
In the aspect of environmental performance, the Company once again received the Green PROPER award from the Ministry of Environment and Forestry (KLHK) for the Lhoknga, Narogong, Cilacap, and Tuban plants. Additionally, these four plants are also candidates for the Gold PROPER award for the first time. This achievement demonstrates the Company's commitment to sustainable development principles in its operations, with measurable targets in sustainable solutions, environmental management, circular economy, social responsibility, and human resource development.
Prospects and Innovations in Facing Business Challenges in 2024
Facing intense market competition, the Company will continue its positive performance by enhancing resilience and competitiveness to deliver optimal benefits for shareholders, customers, stakeholders, and to contribute to sustainable development. All components of the Company must enhance their competencies and excellence through ideas, initiatives and strategic plans, implemented through innovative new methods via synergy and collaboration to improve product quality and services in order to move forward and to win the competition.
The Company will continue to improve efficiency and to explore new innovations, including enhancing the composition of alternative fuel usage and digitizing production processes to make production costs more effective and efficient. In line with this, the Company will continue to strengthen synergy with SIG for product distribution and supply chain to achieve a more competitive cost to serve. All these efforts are supported by optimizing digitalization and automation to improve Plant efficiency.
Overview On Corporate Governance Implementation
The Board of Directors, the Board of Commissioners and all elements of the Company are committed to implementing good corporate governance (GCG) principles as a work culture. The Company believes that adherence to GCG principles in accordance with the applicable regulations and best practices in the business world will enhance shareholder value and public trust.
The Company conducts GCG assessments based on the ASEAN Corporate Governance Scorecard (ACGS) parameters. The assessment instrument refers to corporate governance principles issued by the OECD and the International Corporate Governance Network (ICGN). The GCG assessment is conducted by an external assessment team from the Indonesian Institute for Corporate Directorship (IICD). The assessment results serve as the basis for improvement efforts to enhance the quality of GCG implementation. The GCG assessment results for 2023 reached a score of 88.76 points with an interpretation of “Good,” an improvement compared to the score in 2022 of 88.28 points.
To strengthen the prevention system against corruption and bribery that may pose risks to the Company’s reputation, in 2023, the Company and its subsidiaries undertook various preparations to obtain ISO 37001:2016 Anti-Bribery Management System (SMAP) certification. After undergoing the certification audit process by an independent institution, PT Sucofindo, the Company successfully obtained the ISO 37001:2016 SMAP Certificate with the scope of application covering entities, such as PT Solusi Bangun Indonesia Tbk, PT Solusi Bangun Andalas, PT Solusi Bangun Beton, PT Readymix Concrete Indonesia, PT Pendawa Lestari Perkasa, and PT SBI Bangun Nusantara.
Changes In Composition Of Board Of Commissioners
Based on resolution of AGMS on May 31 2024, regarding changes in the management of the Company as follows:
1.Honorably discharge Lilik Unggul Raharjo from the position of President Director, Prijo Sambodo from the position of Chief Commissioner and Independent Commissioner, and Yoshifumi Taura from the position of Commissioner of the Company.
2.Approve the appointment of Asri Mukhtar as President Director, Prijo Sambodo as Chief Commissioner and Independent Commissioner, Yohanes Surya as Independent Commissioner, and Shinji Fukami as Commissioner.
Hence, composition of the Company’s Board of Directors on May 31, 2024, is as follows:
• President Director : Asri Mukhtar
• Director : Soni Asrul Sani
• Director : Ony Suprihartono
• Director : Yasuhide Abe
Appreciation to All Related Parties
On behalf of the Board of Directors, I would like to express our gratitude to the Board of Commissioners for their advice, guidance and support regarding various important decisions of the Company in 2023. Our highest appreciation goes to all personnels of the Company who have demonstrated excellent teamwork, dedication, and integrity, enabling the Company to overcome various challenges. We hope that the Company can continue to provide optimal benefits to shareholders, employees, and all stakeholders.