Indofood profit falls 37% on weaker rupiah<\/p>\n
Bloomberg, Jakarta<\/p>\n
PT Indofood Sukses Makmur, the world's biggest maker of
\ninstant noodles, said profit fell 37 percent in the first nine
\nmonths this year, as a drop in the rupiah made it more expensive
\nto pay foreign-currency debt and import wheat.<\/p>\n
Unaudited net income fell to Rp 284.6 billion (US$31 million),
\nor 33 rupiah a share, in the nine months ended Sept. 30, from Rp
\n453.5 billion, or Rp 53 a share, in the same period last year,
\nthe company said in a statement. Sales rose 0.9 percent to 13.1
\ntrillion rupiah in the period.<\/p>\n
The weaker rupiah against the dollar increased the local
\ncurrency needed to pay more than $380 million of foreign-currency
\ndebt. The rupiah fell 8 percent in the nine month-period,
\ncompared with a 6.6 percent rise in the same period last year.
\nAbout 60 percent of Indofood's costs are linked to the dollar,
\nmaking it sensitive to the currency fluctuations. Indofood had a
\nforeign-exchange loss of Rp 264.8 billion in the period, from a
\ngain of Rp 34.4 billion a year earlier.<\/p>\n
Indofood is competing with a growing number of producers,
\nincluding detergent-maker Wings Group, which began selling
\ninstant noodles to compete with Indofood last year. Wing's Mie
\nSedap noodle brand retails for a fifth less than Indofood's
\nIndomie and Sarimie brands.<\/p>\n
Indofood, which accounts for more than 80 of every 100 packs
\nof noodles sold in the country, is counting on increasing
\nconsumer demand this year to stem slowing sales growth.<\/p>\n
Indonesia's economy, Southeast Asia's biggest, probably
\nexpanded as much as 4.9 percent in the third quarter, the central
\nbank said earlier this month. Consumer spending accounts for
\nabout 70 percent of the $208 billion economy.<\/p>",
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