The Jakarta Post, Wed, 01/07/2009 11:17 AM
JAKARTA: The state-owned train company PT Kereta Api (KA) made an unexpected Rp 40 billion (US$ 3.7 million) in profits, despite a forecast Rp 57 billion loss, because of fewer accidents, improved efficiency and better sales.
The company's performance improved after it made investments in renewing rolling stock and carriages and increasing safety measures.
"We thought we would make a loss because of the investments, but apparently (the return) came back positively," president director Ronny Wahyudi said.
Better sales of business and executive class tickets and a shift from airplanes to trains because of higher air fares, also helped to boost profits. Ronny said the profits would be allocated to employee incentive programs to increase their efficiency.
The company is targeting to make up to Rp 12.5 billion in profits in 2009.
Meanwhile, in 2008, KA received Rp 544 billion from the government through the public service obligation (PSO) subsidy for keeping the ticket price for the economy class below its operational cost. -- JP
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