T

he weakening of the rupiah against the US dollar has not been bad news for everyone, as several companies have reaped benefits from this situation. Fashion producer and retailer PT Trisula International (TRIS) is one example.

Trisula International CEO Lisa Tjahjadi said 85.8 percent of the firm'€™s sales revenue in the first half of the year came from exports, most of which are paid in foreign currencies.

'€œWe earned Rp 317.3 billion [US$28.87 million] in sales revenue in the first half of the year, of which Rp 272.3 billion was contributed by our exports. The remaining Rp 45 billion was from our retail section,'€ she said, adding that revenue was up 27.4 percent year-on-year (y-o-y).

Trisula produces fashion clothing from its three factories. It takes orders from approximately 20 foreign brands in addition to producing three of its own brands: JOBB, Man Club and UniAsia.

Given the fact that we were strong in exports, she said, 79 percent of the company'€™s sales was in US dollars with another 6 percent in Australian dollars.

'€œThe remaining 15 percent was in rupiah,'€ she noted.

Lisa added that the large amount of earnings in foreign currencies, especially US dollars, shielded the fashion producer and retailer from major losses through currency conversions.

'€œAlthough the soaring US dollar rate is detrimental to the economy, we are put at an advantage as we earn US dollars on our exports,'€ she said.

Based on calculations, Lisa said, a 5 percent rise in the US dollar rate resulted in 10 percent growth in the firm'€™s gross profit margin.

'€œThis is as long as our costs stay the same,'€ she continued.

Trisula'€™s gross profits rose 21.8 percent y-o-y to Rp 79 billion in the first half of 2013.

The firm saw its net profits, before pro forma, go up 92 percent to Rp 12.1 billion while, after pro forma, net profits declined 5.7 percent.

According to Lisa, net profits after pro forma slid due to heavier costs.

'€œThis includes the minimum wage [for workers], which has pushed up not only our costs but also the costs of those who provide us with retail space. The latter has in turn resulted in our paying higher rental costs,'€ she noted.

Various administrations have raised their minimum wage levels for workers. The Jakarta administration, for example, increased the minimum wage by 44 percent to Rp 2.2 million per month.

Trisula experienced a 29.3 percent annual rise in operating expenses to Rp 238.4 billion in the first half of the year.

Despite the higher costs, Trisula is continuing to expand its brand portfolio. The firm announced that it had brought in Bonds, a leisure wear brand from Australia.

Lisa said the company would be investing Rp 15-20 billion over the next two to three years to establish the brand in the Indonesian market.

'€œWe plan to open between four and six sales points for Bonds this year,'€ she noted.