The Company's Revenue for this period grew by 28.9% to Rp 1.0 trillion from Rp 798.9 billion last year. The increase in Revenue was mainly driven by the significant revenue increase from land rig segment by 86.7% to Rp 353.5 billion compared to Rp 189.3 billion the year before. This was caused by the improvement of utilization rate to 61% compared to 46% last year following effective new contracts, especially for geothermal drilling, and the increase in dayrates. On the other hand, revenue contribution from offshore segment also rose by 11.0% to Rp 676.6 billion on the back of Apexindo achievement to maintain 100% utilization rate following the low breakdown rate that the Company was able to generate maximum earnings. Maintained and controlled overall cost appropriately has made direct and indirect cost to merely increase by 16.9%, even though costs in drilling business tend to ascend as demand for rigs is in the rise. Apexindo is able to stabilize the costs so that they do not go linearly with the surging of operational activities, therefore giving more contributions to the Company's profitability level. This is reflected in the improvement of the Company's gross margin from 28.9% to 34.4% and the upsurge of operating margin to 29.5% from 22.3%. The condition ultimately supported the increase in EBITDA by 41.0% to Rp 439.5 billion and EBITDA margin from 39.0% to 42.7%.
The Company has been consistently reducing pressure from distortions to improve bottom line. In third quarter this year, Interest Expense was decreased by 58.5% to merely Rp 38.2 billion. This was in line with the diminishing interest bearing debts that declined by 20.6% year on year (YoY). As EBITDA improved, interest coverage ratio got better to 11.5x compared to last year's 3.4x. Further, with proper financial strategy and improving Rupiah exchange rate, Apexindo successfully booked Gain on Foreign Exchange of Rp 13.4 billion compared to last year's Rp 58.1 billion of Loss on Foreign Exchange. Moreover, Apexindo recorded Gain from Swap Transaction of Rp 120.9 billion driven by improved marked to market valuation on the Company's swap transaction. The Company has conservatively booked Loss from Swap Transaction last year with exchange rate assumption of approximately Rp 9.800,- per USD.
In the third quarter, the Company's balance sheet became healthier following improving performance and declining interest bearing debts. Debt to Equity ratio was booked at 0.4x or better than last year's 0.7x. Liquidity has also been maintained at outstanding level to 3.8x. Agustinus adds, "We are delightful with the achievement, which has exceeded our initial target. It is expected that Revenue in full year 2006, taking into account Rupiah appreciation, may grow at approximately 25% YoY or higher than previously projected at 10% YoY. Meanwhile, with excellent performance and consistent efficiency, EBITDA is expected to reach Rp 600 billion in which equivalent to US $65 million or up by approximately 30% compared to last year's number with the margin above 40%".
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