Gudang Garam's nine-month profit up

Gudang Garam's nine-month profit up

JAKARTA: Indonesia's largest cigarette producer, PT Gudang
Garam, Tuesday posted a nine-month net profit of Rp 1.64 trillion
(US$178 million), up 6.5 percent on year.

Gudang Garam said sales during the period rose 22 percent to
Rp 16.07 trillion from Rp 13.14 trillion last year, boosting net
profit.

Gudang Garam is the leading seller of clove cigarettes, known
locally as "kretek," which account for most of the smoking market
in the country.

The company gave no details on volumes, but analysts expected
the company to have boosted sales by raising prices rather than
selling more sticks.

Indonesia's government has been increasing the amount of
excise tax cigarette companies must contribute to state coffers,
pushing producers to hike prices. In turn, volumes are falling as
consumers turn to cheaper brands.

The company said operating profit for the first nine months
rose 8.2 percent to Rp 2.64 trillion from Rp 2.44 trillion last
year. -- Dow Jones