JAKARTA. PT Matahari Putra Prima Tbk (MPPA) plans to reserve a decrease in the value of its investment in the shares of PT Global Ecommerce Indonesia (GEI) in the amount of Rp 311 billion.
GEI is a shareholder of PT Solusi Ecommerce Global (SEG). SEG is the owner and entity that operates the MatahariMall.com platform.
Through information disclosure to the Indonesia Stock Exchange (IDX) on March 6, 2019, Danny Kojongian, Corporate Secretary of MPPA stated that recently the company had received information relating to changes in GEI's business strategy. Initially GEI was an online marketplace platform from a diverse industry (MatahariMall.com); it has since become an online site that only focused on selling fashion goods.
For this reason, MPPA has reviewed the fair value and future prospects of its investment in GEI. As a result, MPPA management decided to take a prudent stance by fully reserving a decrease in the investment value of Rp 311 billion at GEI in the final financial statements of 2018.
As a result of this incident, MPPA's net profit will decrease by Rp. 311 billion. However, continued Mr Kojongian, the impact would not affect the company's financial and operational conditions because it was only an accounting loss.
Although MPPA management stated that the action plan would not affect financial conditions, in fact the company's financial performance was quite alarming. As of September 30, 2018 MPPA culd only print a net loss of Rp 335.85 billion. If MPPA reserves a decrease in the value of investment in GEI in the financial statements at the end of 2018, it is possible that the net loss will swell.
In 2017 MPPA posted a business loss of Rp 1.56 trillion compared to the previous year (2016) which generated an operating profit of Rp 177.04 billion.
MPPA's stock price in the past week has been depreciating. At the close of trading on February 27 MPPA's stock price was at the level of Rp 390 per share, as of March 6 the price has been corrected to the position of Rp 284 per share, corrected to 27.18%. (AM/MS)