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Indofood to spend $30m on new snack factory

PT Indofood Sukses Makmur, the country’s largest instant noodle manufacturer, plans to invest at least US$30 million to finance the expansion of the company’s production facilities next year

Mariel Grazella (The Jakarta Post)
Jakarta
Thu, November 29, 2012

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Indofood to spend $30m on new snack factory

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T Indofood Sukses Makmur, the country’s largest instant noodle manufacturer, plans to invest at least US$30 million to finance the expansion of the company’s production facilities next year.

Indofood spokesperson Werianty Setiawan said in Jakarta on Wednesday that the company would build new snack and sauce factories, among other facilities, as part of its expansion plans for next year.

She said the construction of the new factories was part of the company’s long-term expansion program. “We are investing around Rp 2.3 trillion [US$239.16 million] in various factory expansions this year,” she said.

At present, in addition to other food production facilities, the company owns at least four milk factories in Jakarta, Sukabumi, West Java and East Java, which are operated by a subsidiary, PT Indolakto.

The total production capacity of these factories is roughly 375,000 tons per year.

“We have allocated Rp 6.4 trillion for our capital expenditure this year. Any remaining amount at the end of this year will be carried over to the next,” she said. Werianty added that the company had disbursed approximately Rp 3.2 trillion in capital expenditures during the first nine months of the year.

She added that certain company projects, including those related to the expansion of its instant noodle and flour factories, would be also carried over to next year.

Indofood subsidiary PT Indofood CBP Sukses Makmur oversees the production of instant noodles, dairy products, food seasoning, snacks and nutritional foods.

The CBP group contributed up to 43 percent to the company’s consolidated net sales, which reached Rp 37.2 trillion in the first nine months of the year, a rise of 10.3 percent from the Rp 33.7 trillion booked in the same period last year. Sales of the CBP unit have grown by 12.9 percent, mainly due to the increasing sales volume of all divisions within the group.

Meanwhile, the company will maintain a capital expenditure of up to $250 million to develop its agribusiness operations next year, which includes the sowing of plants.

The company’s agribusiness unit is run by PT Salim Ivomas Pratama and PT Perkebunan London Sumatra Indonesia, subsidiaries of Indofood Agri Resources.

Franciscus Welirang, a company director, added that the company sought business growth in line with the GDP growth of the country.

The finance minister estimates that GDP growth next year will be 6.8 percent.

“A growth rate similar to that of the GDP growth is a good indication,” he noted.

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