Indofood to pay out 40 percent of net profit in dividend

The Jakarta Post , Jakarta | Thu, 05/31/2007 8:49 AM | Business

The Jakarta Post, Jakarta

PT Indofood Sukses Makmur, the world's largest instant noodle producer, will set aside 40 percent of its 2006 net profit for a dividend.

The company will pay its shareholders Rp 31 a share, or about Rp 264.3 billion (US$30.3 million) in total, as agreed to by the annual shareholders' meeting Wednesday.

In 2006, the company booked Rp 661.21 billion in net profit.

This year's dividend will be significantly higher than last year, when Indofood declared a dividend of Rp 15 per share out of the company's 2005 net profit of Rp 124 billion.

The rise is attributable to strong sales growth across most of the company's divisions, which has been partly driven by an improved distribution system and more focused marketing strategies, president director Anthoni Salim said after the meeting.

The company's Consumer Branded Products Strategic Business Group (SBG) -- which is responsible for the noodles, food seasonings, snack foods, and nutrition & special foods divisions -- posted sales growth of 18.6 percent last year, while Bogasari SBG posted 13.6 percent growth, and the edible oils & fats SBG 8.6 percent.

Franciscus Welirang, company deputy president director, said that for this year, the company would focus more on the palm-oil business by setting a target for the expansion of its plantation holdings to 250,000 hectares by 2015 from the current 138,000 hectares.

Indofood Agri was in talks with a view to acquiring plantation firm London Sumatra. Franciscus said that if the acquisition went ahead, the company would increase the area of its plantations to 166,000 hectares.

Higher crude palm-oil prices also boosted sales of CPO to Rp 1.3 trillion in 2006 from Rp 1.17 trillion in 2005.

The shareholders' meeting had earlier given its approval for one of the company's subsidiaries operating in the edible oils and fats sector, PT Salim Ivomas Pratama, to buy majority stakes in PT Mentari Subur Abadi, PT Swadaya Bhakti Negaramas and PT Mega Citra Perdana.

The three firms own a total of 85,541 hectares of plantation land located in South Sumatra, East Kalimantan and Central Kalimantan.

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