Indofood loses Rp 456b from rupiah depreciation

JAKARTA (JP): Publicly listed PT Indofood Sukses Makmur (ISM), a unit of the widely-diversified Salim Group, reported yesterday a net loss of Rp 456 billion (US$126.66 million) in the first nine months of 1997 caused by foreign exchange losses.

The company said in a statement that it had recognized, as a one-time charge to its operations, Rp 900 billion in foreign exchange losses incurred by the rupiah's steep depreciation.

"As of the end of September, Indofood had about Rp 1.1 trillion in cash and deposits as well as Rp 3.6 trillion in long- term bank loans denominated in U.S. dollars due within five years," the company said.

Indofood explained that Rp 682 billion of the total losses was considered an extraordinary charge and consequently it booked a net loss of Rp 456 billion for the first three quarters.

The statement did not mention the company's operating profit to explain how the net losses were calculated.

"However, Indofood's fundamentals remain strong and the market shares of our products have basically remained at the same level as last year's," Indofood chief executive officer Eva Riyanti Hutapea said.

The statement said that Indofood recorded an increase of 68 percent in net sales to Rp 3.5 trillion in the year's first nine months.

It added that its noodle division accounted for 37 percent of total sales with a 10 percent growth in the sales volume to 6.3 billion packs due to the operations of the Manado and Pontianak factories beginning in late 1996.

The statement said that its noodle division's net operating profit increased to 23 percent as a percentage of sales in 1997, compared with 21 percent in 1996.

The edible oil and plantation operations, which were acquired in April 1997, contributed around Rp 313 billion in net sales or accounted for 9 percent of the company's consolidated net sales in the first nine months. This division produced a 44.5 percent operating margin and contributed 23 percent of total operating profits.

The company added that its Bogasari Flour Mills division accounted for 23 percent of the net sales and contributed 20 percent to the group's operating profits.

"Up to September 30, 1997, the baby foods division achieved an 18 percent net operating profit margin and the snack foods yielded 11 percent," the statement said.

On the overall condition, Indofood's net operating margin were maintained at about 18 percent of net sales.

But the company did not disclose its amount of the operating profit for the Jan-Sept period.

The statement said that the group's total assets increased to Rp 6.2 trillion in 1997 from Rp 4 trillion in 1996 due to the acquisition of six sister companies in April this year.

The company acquired PT Salim Invomas Pratama (oilpalm plantations), PT Intiboga Sejahtera (edible oils), PT Salim Oil Grains (edible oils trading), PT Bitung Menado Oil Ltd (coconut oil), PT Argha Giri Perkasa (coconut oil) and PT Indomarco Adi Pratama (consumer goods) for Rp 1.55 trillion in April. (aly)