Indofood seeks to emulate last year's accomplishment
The Jakarta Post, Jakarta
PT Indofood Sukses Makmur, the world's largest flour miller and instant noodle producer, is upbeat about retaining its market- leader status this year despite tighter competition amid the emergence of new players.
President director and CEO Anthoni Salim said, "In light of the increased competition, we'll try to maintain last year's sales numbers".
Speaking to reporters on Friday following a shareholders' meeting, Anthoni said the company was on track to reaching the goal, having posted a slight increase in sales in the first quarter of the year from the corresponding period a year before.
As of April this year, sales stood at Rp 4.29 trillion, up slightly from the Rp 4.23 trillion recorded during the same period last year.
On profit, the company is aiming to bring back its net profit to about Rp 600 billion this year -- a level it reached in 2003.
Last year, although sales were recorded at Rp 17.92 trillion, an increase from Rp 17.87 trillion in 2003, Indofood's net profit fell by 37 percent to Rp 378.1 billion from Rp 603.5 billion in 2003.
The decrease was due to foreign exchange losses of Rp 296.9 billion, triggered by its huge dollar-dominated debts.
Indofood is waiting for a decision by an English-based court, expected to be issued by the end of July, on whether the company can redeem its remaining dollar-denominated debt at a par value.
Indofood has redeemed US$120 million out of the $280 billion guaranteed notes issued in 2002 -- a decision taken after the government scrapped a tax treaty with Mauritius. The bonds were issued through a Mauritius-based wholly-owned subsidiary.
Should the court's decision favor the firm, Indofood would issue rupiah-denominated debt of up to Rp 1.75 trillion, to replace the dollar-denominated debt, director and head treasurer, Thomas Tjhie, said.
During the meeting, it was also agreed that the company would pay a dividend of Rp 17.5 per share, equivalent to 39 percent of its net profit, lower than last year's dividend of Rp 28 per share.
On plans of a spin-off and initial public offering of its wheat flour division, Bogasari, Antoni said the company would wait for the right time while continuing to monitor the market.
Franciscus Welirang, Indofood vice president director and head of Bogasari, said that the company was in no rush to spin off its wheat flour division, which contributed to over one third of Indofood's sales last year.
"We'll wait until we can get a maximum result for our company and shareholders," said Welirang. (002)