The world's largest instant noodle producer, PT Indofood Sukses Makmur, reported record sales growth in 2006, which the company attributed in part to improved marketing strategies.
President director and CEO Anthoni Salim said that consolidated net sales rose by about 17 percent to Rp 21.94 trillion (about US$2.4 billion), the highest rate of growth for the last 13 years.
Anthoni said that the record sales had been achieved after the successful implementation of strategic initiatives launched in 2004, despite the unexpected hurdles and challenges that had emerged since them.
The increase was the product of strong sales growth across most of the company's divisions, and was partly driven by an improved distribution system and more focused marketing strategies.
The company's Consumer Branded Products Strategic Business Group (SBG), which is responsible for the noodles, food seasonings, snack foods, and nutrition & special foods divisions, posted total sales growth of 18.6 percent last year, while Bogasari SBG posted 13.6 percent growth, the Edible Oils & Fats SBG 8.6 percent, and the Distribution SBG 32.3 percent.
Operating profit increased 18.8 percent to Rp 1.98 trillion, with the operating margin widened to 9 percent, compared to the Rp 1.66 trillion and 8.9 percent, respectively, in 2005.
"These were the results of the continuous implementation of operational and cost efficiency measures throughout the organization," Anthoni said in a statement.
Net income rose significantly to Rp 661.21 billion, or Rp 78 per share, from Rp 124.02 billion, or Rp 15 per share, in 2005, mainly due to improved operating profit, lower net interest and other financing charges, as well as foreign exchange gains arising from the strengthening of rupiah.
Net cash provided by operations was Rp 1.49 trillion, compared with Rp 800.68 billion in 2005, driven by strong operating profit growth, he added.
The company said that in line with its policy of further reducing foreign currency exposure and mitigating the effects of fluctuations in interest costs, it would issue a fourth series of rupiah-denominated bonds in the second quarter of this year.
"Indofood will evolve dynamically in its quest to maximize performance through improved operating efficiency and the implementation of key strategic initiatives," Anthoni said.
"I am confident that our current business model, supported by dedicated and committed personnel, will place us in a better position to deliver sustainable results in 2007 and beyond."