Krakatau Steel Strengthens Business and Financial Foundations for Sustainable Growth

Cilegon – PT Krakatau Steel (Persero) Tbk /Krakatau Steel Group (IDX: KRAS), a leading steel producer in Indonesia, continues to take a series of strategic and transformative steps to strengthen the company’s business fundamentals and financial structure. This effort is part of the company’s transformation roadmap to build a solid foundation, increase competitiveness, and ensure sustainable growth amidst challenging global market dynamics.

Resource and Production Optimization

Krakatau Steel has implemented optimization of resources and production, and is actively evaluating and optimizing all of its business lines and subsidiaries.

This step also includes efforts to increase operational efficiency throughout the supply chain, from upstream to downstream, as well as focusing resources on business segments that have high growth prospects and margin contribution.

This strategy is designed to create a business structure that is leaner, agile and profitable. The selection of raw materials, energy efficiency and maximizing input and output in terms of production are expected to have an effective impact on company efficiency.

Financial Transformation and Capital Structure Improvement

Krakatau Steel Group has and continues to explore and implement various initiatives to improve the health of its balance sheet. Debt restructuring is an effort to renegotiate a number of credit facilities with creditors to obtain lighter repayment, extend maturity periods and reduce interest costs.

As an effort to strengthen liquidity, the company continues to optimize working capital and cash flow management to support stable, efficient and sustainable operations.

The company continues to provide easy access and transparency of information to shareholders. In accordance with the commitment of the Government of the Republic of Indonesia as the majority shareholder, to support the restructuring program and strengthen the company’s capital structure.

Transformation in the financial aspect is also implemented down to the employee level in carrying out daily agendas. The Company actively provides advice in terms of reducing unproductive costs such as not having meetings at hotels or reducing business travel costs.

Increasing Operational Competitiveness

The transformation and restructuring carried out by the Company since 2019 continues to have a positive impact on various aspects of the Company. The realization of highly competitive Krakatau Steel cannot be separated from the Company’s commitment to increasing efficiency and productivity in all operational lines.

Various efforts and innovations have been made to encourage competitiveness, including through investment in maintaining production facilities, adopting the latest technology, and implementing best industrial practices to reduce production costs (cost efficiency) and improve product quality.

What is no less important is that the Company continues to open its eyes to global trends and issues, especially in carrying out business practices towards a green economy. Krakatau Steel has begun developing more environmentally friendly steel products and preparing itself for the sustainable energy transition. This commitment is not only to meet future regulations and market demands but also to create long-term value for all stakeholders.

All efforts made and through world-class quality steel products are supported by the supply of important utilities from the Krakatau Steel subsidiary which includes energy supplies, industrial raw water processing facilities, technology and information needs, industrial support service needs, as well as complete distribution and transportation access to ensure the smooth production chain including railways, toll roads and ports, providing opportunities for the Company to climb the world stage.

As a result, Krakatau Steel’s steel products have reached the trust of the global market from Asia, Australia, Europe, the Middle East, to the United States. Most recently, the Company recorded an export record for Cold Rolled Coil (CRC) products of 54,247 tons to Spain last September.

From Top to Bottom, Together Increase Productivity

The Anagata Nusantara Power Investment Management Agency (Danantara Indonesia) has issued a policy through circular Number S-063/DI-BP/VII/2025 which officially eliminates bonuses and incentives related to performance for members of the board of commissioners of BUMN and its subsidiaries.

Danantara’s spirit of efficiency is continued within Krakatau Steel by restructuring the organization within the company and implementing employee time management which aims to ensure tasks can be completed effectively and efficiently.

“The steps we are taking now are a very important foundation for bringing Krakatau Steel into a new, stronger and more sustainable era. We are not only focused on resolving short-term financial challenges, but more than that, we are building a company that is resilient, competitive and trustworthy,” emphasized the President Director of PT Krakatau Steel (Persero) Tbk, Akbar Djohan, who also serves as Chairman of IISIA (Indonesia Iron & Steel Industry Association) and Chairman of ALFI/ILFA (Logistics & Forwarder Association). Indonesia).

Akbar added that his party does not turn a blind eye to the fact that support from all stakeholders, including the Government, creditors and business partners, is a key factor in this transformation journey in making Krakatau Steel a national strategic industry that is highly competitive.

With increasingly solid business and financial foundations, Krakatau Steel Group looks to the future with confident optimism. The company is determined to continue to meet domestic steel needs, contribute to national development, and increase value for shareholders and all stakeholders. This is certainly in line with President Prabowo Subianto’s Asta Cita.

About Krakatau Steel Tbk

A Glance About PT Krakatau Steel (Persero) Tbk PT Krakatau Steel (Persero) Tbk is an integrated steel manufacturing company which was founded on 31 August 1970. Apart from operating in the steel industry sector, Krakatau Steel and the Group develop integrated industrial area businesses, ports, logistics, industrial water providers and energy supplies in the form of power plants as well as several joint ventures with Korean and Japanese companies.

Krakatau Steel is currently strongly committed to carrying out transformation in the spirit of “Revolutionary Movements: Committed to Transform” which aims to improve company performance, build trust and transparency with stakeholders, and attract investors. This transformation covers various aspects, including improving Human Capital, developing downstream business, and improving infrastructure business.