Competitive Advantage and Risk Management
  • COMPETITIVE ADVANTAGE

    UIC is a sole producer of Alkylbenzene in Indonesia, supported by its experience of more than thirty years in the industry and modern technology used in its operations. The Company competes with overseas producers in setting competitive selling price. The Company's credibility to keep its products quality has been recognized through the certification of international quality ISO 9001:2015 that were obtained since 2003. Moreover, the Company also obtained certifications of ISO 14001:2015 since 2004 for its commitments in preserving its environments and also OHSAS 18001:2007 certification since 2013, which is the international certification for the Company's commitment in maintaining health and safety in the workplace.

    The just-in-time delivery system implemented by the Company has allowed the Company to supply the customers punctually. The ability to implement this delivery service enables our customers to reduce their storage cost and manage their stock


    RISK MANAGEMENT SYSTEM

    Similar to other businesses, the Company and its Subsidiaries (Group) also have the potential to be exposed to business risks attributed to internal and external factors which may bring impact on the Company performance.

    Control of the risks carried by identity and evaluate the main risks that faced by the Company, develop strategies and mitigation controls to manage the risks and assessing the continuing risk after risk control is done.

    The Company also constantly remind its employees about risk awareness so that they can contribute to the risk management and provide essentials input in decision-making.

    As follows is the risk that identified can bring impact to the Company performance and how to managed the risk:

    • Interest Rate Risk

    The Company's and Subsidiaries (Group) interest rate risk mainly arises from loans for working capital purposes and long term bank loans. Loans at variable rates expose the Group to fair value interest rate risk. The Group has interest risk arising from floating rates of their loan. The Group monitors the interest rate fluctuation to minimize any negative impacts to the Group.

    • Foreign Currency Risk

    The Group has foreign exchange risk primarily arising from recognized monetary assets and liabilities that are denominated in a currency other than the entity's functional currency. The Group is aware about market risk due to foreign exchange fluctuation. To mitigate the impact of fluctuations in foreign exchange rates on the Group's assets and liabilities, whenever possible, the Group always manages a proper proportion of significant assets and liabilities denominated in foreign currency based on the respective entity's functional currency. If the assets are insufficient to cover its liabilities, the Group may enter into derivative transactions to mitigate such risks.

    • Commodity Price Risk

    The Group faces commodity price risk arising from the volatility of crude oil price, level of demand and supply in the market and the global economic environment. The volatility of crude oil price have indirect affects the Group's raw materials price. The Group's policy to minimize the risks arising from the fluctuations of raw material price is to foster more efficient raw material procurement and production to suit customers demands.

    • Credit Risk

    The Group faces credit risk arising from the credits granted to the customers, but it has policies to ensure that sales of products are made only to creditworthy customers with proven track records or good quality credit history. The Group applies prudent credit acceptance policies and performs ongoing credit portfolio monitoring.

    It is the Group's policy that all customers who wish to trade on credit terms are subject to credit verification procedures. The Group has policies that limit the amount of credit exposure to each particular customer. Utilization of credit limits by customers is regularly monitored by the management. Customers who do not qualify for credit facilities are required to pay in advance or provide Letter of Credit. In addition, the receivable balances are monitored on an ongoing basis to reduce the Group's exposure to bad debts.

    • Liquidity Risk

    The Group manages its liquidity profile in order to finance its capital expenditures and settle its maturing debts as they become due by maintaining sufficient cash and cash equivalents, and the availability of funding through an adequate amount of available credit facilities. The Group regularly evaluates its projected and actual cash flow information and continuously monitor the maturity of its financial assets and liabilities.

    The authority for implementation and management of the risk management framework is given to the Directors and the Internal Audit Division as the responsible of the Company's risk management. The risk management system applied by the Company is able to minimize or suppress the possibility of the risk occur. Implementation of a comprehensive risk management system, enable the Company effectively manage the risk so that can take into account the risk portfolio and perform preventive measures.


    -jxix

Investor Relations
  • Board of Commissioners Report
  • Directors Report
  • Management Discussion and Analysis
  • Consolidated Statements of Comprehensive Income
  • Consolidated Statements of Financial Position
  • Financial Highlights Graphics
  • Ratio Analysis
  • Business Prospect and Strategy
  • Competitive Advantage and Risk Management
  • Shares, Dividends and Chronology of Company Listing
  • The Significant Laws and Regulations Changes
  • Annual Reports
  • Quarterly Financial Statements