PT. AKR Corporindo Tbk

Corporate Profile | Message from the President Commissioner

	Dear Shareholders, Year 2009, witnessed the Global economic growth fall to the lowest levels since World War II and aided by wide ranging policy actions taken by the Governments in various economies and various financial reforms the economies recovered. Economies in Asia Pacific now are the drivers of growth with their large consumer demand and relatively better condition of the financial Institution. Indonesia, South East Asia’s largest economy benefited from the sound economic policies of the Government, stimulus packages announced with helped to spur economic growth and keep lower inflation and a stable exchange rate. These measures provided a cushion for households in Indonesia and this will help in maintain a healthy growth for this year.
Mr Soegiarto Adikoesoemo

We are proud to report that the PT AKR Corporindo Tbk reported strong financial performance during the year 2009 with sustained growth in all three lines of business The Company reported consolidated sales revenue of Rp 8,959 billion as per the audited financial statements of the Company which was audited by International audit firm Ernst and Young. The Company’s net profit rose 31% in 2009 to Rp 275 billion representing CAGR growth rate of 24% in 6 years. AKR Corporindo continued to focus on its trading and distribution business, in which it has a track record of nearly 5 decades. AKR which started as a small chemical distributor will turn 50 years during the year 2010. During this journey, it has focused on its core competencies and continued to innovate and expand its supply chain network and now operates in all major islands of Indonesia and also has a foot print in China. Indonesian demand for refined petrolum products continues to rise with the growth in mining, commodities and consumer sectors. The process of deregulation which began in 2005 has opened the market opportunities for players with strong supply chain capabilities. AKR with its long experience in distribution of flammable and corrosive chemicals has not only expanded its network but also provided value added services in the petroleum business. The Company achieved petroleum sales volume of 1,025,042 KL in 2009, growing each year since we entered as the first player in 2005. The Company’s customer base in the distribution business has grown significantly expanding into new areas during the past 4 years with new customers in petroleum business in addition to our long term customers from basic chemicals distribution business.. The opening of the subsidized business in 2009 is also a land mark in the history of the country and we are happy to report that AKR’s facilities and network which was assessed by BPH Migas was complying with the requirements and AKR is the only private Indonesian Company to be allowed to distribute subsidized fuel in 2010. This is a small step but opens a big opportunity for the downstream market players. The Company’s subsidiary PT Sorini Agro Asia Corporindo Tbk (Sorini) which combined with Khalista Liuzhou Chemical Industries, China is one of the largest producers of Sorbitol in the World, reported consistent growth performance in its Sorbitol, Starch Sweeteners and Starch manufacturing businesses. In 2009, Sorini generated sales revenue of Rp 1,471 billion and net profit of Rp 157.5 billion growing 10.5% over 2008 net profit performance. AKR is the major shareholder of Sorini owning 69.5%. Sorini now is focusing on increasing its market share in the domestic markets for Starch and Starch Sweeteners and has been increasing production capacity while also implementing several cost saving projects to improve further on its existing low cost structure and enhance profitability. Also the strategy to increase its in house capacities for starch manufacturing since the last 3 years has also resulted in assuring feed stock supplies and also to increase its product portfolio in the Tapioca Starch business. Investments in key logistics business, such as the construction of the Jakarta Tank Terminal (a joint venture petroleum storage tank terminal facility with Royal Vopak of Netherlands) is progressing well and our investments in the Chinese river ports acquired by the Company in 2006 have resulted in improved returns. The modernization and expansion plans of these ports are progressing well. The growth strategies implemented by the Board of Directors have built a platform for the growth of Company’s lines of businesses. The logistics infrastructure set in place and the further expansions planned will further strengthen the network and enable growth in new areas in Eastern Indonesia while the strategies in manufacturing will not only provide growth in revenues but also make Sorini more cost efficient and provide sustainable returns. In 2009, the Board of Commissioners has evaluated the business plans for the year 2009 and reviewed performance against budgets on a quarterly basis, including review of investments, financing and other critical parameters. The BOC also reviewed the budgets for the year 2010 and discussed the operating conditions and management strategy while paying attention to risk management practices. The Board of Commissioners also reviewed the Good Corporate Governance practices employed by the subsidiaries for the year 2010. To enhance transparency, accountability towards the shareholders and enable them to enhance shareholder value. The Independent audit committee conducted periodic meetings with the Company’s Board of Directors, External auditors and reported to the Board of Commissioners their review of the financial statements reported quarterly and for the audited financial statements for the year, reviewed the internal audit process and significant findings and offered their valuable inputs and suggestions. The Board of Commissioners also were informed of the Corporate Social Responsibility activities undertaken, by the Company and its subsidiaries which bring benefits to the neighboring communities of the Company’s operational facilities as well as the surrounding environment. We are confident that the Board of Directors and other Members of the Management have extensive experience and capability to deal with the ongoing business activities and lead the Company further on the sustainable growth path. The Board of Commissioners of PT. AKR Corporindo Tbk would like convey our sincere appreciation to the employees of the Company and its subsidiaries for their hard work, dedication, commitment and support enabling the Company to continue its journey on the growth path. For and on behalf of the Board of Commissioners,. Mr Soegiarto Adikoesoemo President Commissioner