The decline in the prices of crude palm oil and other commodities is the main factor in the 5.7 percent drop in net sales recorded by the world’s second-largest instant noodle producer, PT Indofood Sukses Makmur, the company says.
Net sales dropped to Rp 28.2 trillion (US$2.99 billion) during the first nine months of 2009, from Rp 29.9 trillion recorded in the same period last year.
Almost all the company’s business units, however, reached higher production volumes during this period, Indofood corporate secretary Werianty Setiawan said Tuesday.
“Lower CPO and rubber prices caused our agribusiness group to contribute only 19 percent to the total sales, lower than last year’s 27 percent,” Werianty said in an official statement.
Indofood’s flour producer, the Bogasari group, also recorded a smaller contribution to consolidated net sales, down to 29 percent from 31 percent last year.
“The flour price was also slightly lower,” Werianty said.
Indofood operates its agribusiness through subsidiary PT Indofood Agri Resources Ltd. (IndoAgri), the mother company of cooking oil producer PT Salim Ivomas Pratama and plantation firm PT PP London Sumatra Indonesia Tbk., which operates more than 187,000 hectares of oil palm plantations.
The sales performance of Indofood’s agribusiness subsidiaries could not keep up with the sales acceleration showed by Indofood’s consumer-branded product group.
This group, consisting of the producers of noodles, dairy products, seasoning, special foods and nutrition, continued to be robust, contributing 43 percent to the company’s consolidated net sales, an increase from 30 percent last year.
“Volume of consumer-branded product sales increased across the divisions,” Werianty said.
Indofood’s promising performance from its consumer products divisions contributed to the 3.5 percent increase in gross profit, to Rp 7.72 trillion from Rp 7.46 trillion, during the first three quarters of 2009.
“Including foreign exchange gain, we recorded even more significant growth in net profit, up 42.43 percent from Rp 1.11 trillion in 2008, to Rp 1.58 trillion,” Werianty said.
Indofood president director Anthoni Salim said the company maintained its performance in the first three quarters of the year thanks to domestic consumers, who continued to prefer Indofood brands, despite the lower CPO price.
“Thanks to our customers who have maintained our products as their preferences,” he said.
In September, First Pacific Co., the holder of 51 percent of Indofood shares, said it would divest Indofood’s noodle and food seasoning divisions into a separate company that would be 100 percent owned by Indofood. The spin-off is aimed at greater efficiency.
Indofood’s share price slipped 0.8 percent to Rp 3,300 at the close of trade Tuesday at the Indonesia Stock Exchange. (bbs)
