Transformation of SOE Ministry Annual Report 2020
MINISTRY OF STATE-OWNED ENTERPRISES
ANNUAL REPORT 2020
04
SOE PORTFOLIO &
CONSOLIDATED FINANCIAL
PERFORMANCE REVIEW
SOE PORTFOLIO & CONSOLIDATED
FINANCIAL PERFORMANCE REVIEW
SOE Economic Value-Added Creation Framework
In carrying out the strategy aimed at fulfilling the first of the five priorities of SOES, added
economic value needs to be redefined d to ensure the creation of growth that adds
economic value, but at the same time balances the stability of the SOEs' financial
structure.
On the priority of Creating Economic
and Social Value for Indonesia, the
Ministry of SOE directed SOEs to
consistently incorporate the creation
of Added Economic Value in their
financial strategies. The following 3
diagrams described four integrated
steps to create Added Economic
Value, focusing on:
1.
Economically-sustainable
expansion, as measured by
the following parameters: (1)
Expansion of EBITDA and cash
flow from operations, both being
the indicators of business scale
growth that is in balance with
cost control; and (2) Net Profit
and Dividends that suggest
dividend payout capacity for
shareholders;
2.
Added economic value
creation, calculated based
on the excess of Return on
Invested Capital (ROIC) above
the cost of the invested capital
used to generate the return on
investment;
3.
Maintaining a balanced financial
structure, recognizing that that
the capital structure of SOES must
optimally utilize low-cost funds
from loans but still maintain a
balanced financial structure and
sustainable payment capacity.
Business Model
Innovation
Technology
Leadership
RESILIENCE AMIDST UNCERTAINTY
Talent
Development
Economic and
Social Values for
Indonesia
G
Boosting
Investments
53View entire presentation