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alling prices of palm oil and rubber slashed the net profits of PT Salim Ivomas Pratama and its subsidiary PT PP London Sumatra Indonesia in the first half of 2012.

Salim Ivomas, a part of the Salim Group, said on Wednesday that its net profits were down by 28.14 percent, to Rp 882 billion (US$92.6 million).

The decline in the net profit was attributed to the lower average selling prices of palm and rubber products, and higher costs, the company said. Costs of goods sold surged 28.23 percent to Rp 4.92 trillion, while selling and distribution expenses increased 16.65 percent to Rp 192.34 billion.

Lower net profit aside, Salim Ivomas managed to record a 14-percent increase in net sales to Rp 6.98 trillion from a year earlier. The net sales growth was supported by higher sales volume of its crude palm oil (CPO), palm kernels, and edible oil and fat (EOF) products.

Sales volume of EOF products, including cooking oil, coconut oil and margarine, grew 11 percent to 432,000 metric tons, while the sales volume of crude palm oil rose 5 percent to 420,000 tons and palm kernels by 11 percent to 94,000 tons.

Salim Ivomas, which has 11 subsidiaries in the investment and agribusiness sectors, says its total assets stood at Rp 25.85 trillion as of June, while liabilities and equities reached Rp 10.39 trillion and Rp 15.45 trillion respectively.

Singapore-listed Indofood Agri Resources Ltd. holds 72 percent of Salim Ivomas’ shares, while PT Indofood Sukses Makmur controls another 6.4 percent.

Separately, London Sumatra Indonesia, an agribusiness subsidiary of Salim Ivomas, said its net profits plunged 28 percent to Rp 639.2 billion from last year due to declining net sales, which fell 6.4 percent to Rp 2.23 trillion in the first half of 2012.

CPO products accounted for Rp 1.63 trillion of their sales, followed by rubber with Rp 210.3 billion, palm kernels Rp 207.3 billion and oil palm seeds Rp 162.3 billion.

In the first quarter of this year, CPO production rose 0.6 percent, and palm kernels were up 0.3 percent, but rubber production fell 14.7 percent as a result of bad weather, the company said. (tas)