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Unilever projects H1 sales growth, appoints former energy minister as commissioner
Unilever Indonesia has announced a 1.5 percent year-on-year rise in its indicative net sales to Rp 21.77 trillion (US$1.49 billion) in the first half of the year, propelled by an increase in domestic sales.
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Publicly-listed consumer giant Unilever Indonesia has its headquarters in BSD, Tangerang. (File/unilever.co.id)
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onsumer goods giant PT Unilever Indonesia estimates that its net sales increased to Rp 21.77 trillion (US$1.49 billion) in the first half of the year, which would mark annual growth of 1.5 percent.
Sales growth was propelled particularly by domestic demand, the company announced on Friday, as domestic sales rose 1.6 percent over the same period.
“With the current challenging and dynamic situation, we are focusing on three aspects: the safety, health and wellbeing of our people, ensuring business continuity […] during this challenging time and contributing to society at large through various COVID-19 relief efforts,” Unilever Indonesia chief financial officer Arif Hudaya said in a statement filed to the Indonesia Stock Exchange (IDX).
The publicly listed company, the local arm of Anglo-Dutch company Unilever, said the April-June period had been particularly hard, as the coronavirus pandemic had forced its food unit’s customers, namely hotels, restaurants and cafes, to shut down entirely or operate at less than full capacity.
The company recorded a 1.6 percent drop in net sales in the second quarter after a 4.58 percent annual increase booked in the first quarter.
The COVID-19 pandemic has hit business activity in the country as shops, offices and factories were forced to close to comply with social restrictions implemented to curb the virus spread. The cooling economic activity has taken its toll on people’s purchasing power as millions have lost their jobs.
In an email interview with The Jakarta Post in May, Unilever Indonesia president director Hemant Bakshi shared his expectation that customers in the future would be less complacent, especially about their health and hygiene. He expressed optimism that, if his company was able to tap into behavioral changes, it would see positive results.
“Given the impacts of large-scale social restrictions (PSBB), which we believe will be more visible in the second quarter, we predict that most of [Unilever’s] second-quarter financial results this year might come out weak,” Mirae Aset Sekuritas Indonesia analyst Mimi Halimin wrote in a note on Friday.
“However, we think that run-rate achievement of 48.4 percent (MiraeAsset Sekuritas Indonesia) and 49 percent (consensus) in first half sales was still relatively in line, amid the challenging conditions in the second quarter, although it’s slightly below last year’s achievement,” she added.
Unilever Indonesia will announce its first-half financial report on July 30. Its stocks, traded on the IDX under the code UNVR, were up 0.31 percent as of 3 p.m., while the benchmark, the Jakarta Composite Index (JCI), plunged 1.21 percent.
Also on Friday, the company’s annual shareholders meeting appointed former energy minister Ignasius Jonan as a commissioner. Unilever Indonesia expected the appointment of Jonan, who once also served as state-owned railway firm PT Kereta Api Indonesia (KAI) president director and transportation minister, could support the company’s efforts to better understand the domestic market.
The company also appointed Badri Narayanan, who has been with the company for 20 years, as a director.
“With the support of the qualified talent, the company is optimistic about its ability to survive, give livelihood to thousands of employees and millions of people in its supply chain amid this challenging situation,” said Unilever Indonesia director and corporate secretary Sancoyo Antarikso in a statement.
The meeting also approved the payment of Rp 7.4 trillion or Rp 193 per share in dividends to the shareholders. The dividend equals the company’s entire 2019 net profit, which grew by 9.3 percent year-on-year (yoy).
Last year, Unilever Indonesia booked an annual increase of 2.7 percent to Rp 42.9 trillion in net sales.
