Indofood's profit up 16%

Indofood's profit up 16%

Dow Jones, Jakarta

PT Indofood Sukses Makmur, the world's largest noodle maker, Thursday said its net profit in the first nine months stood at Rp 651.90 billion, up 16 percent from a year earlier.

The higher net profit was largely due to a stronger local currency, which pushed down the cost of servicing the company's foreign debt. Indofood made a foreign exchange gain of Rp 213.32 billion in the period compared with a loss of Rp 228.00 billion a year ago.

On an operating level, profit shrunk 13 percent to Rp 1.33 trillion due to higher expenses, the company said. The higher price of raw materials in the period - especially crude palm oil and wheat used in noodle production - raised costs. A government- mandated fuel price hike also hurt operating profit.

Net sales were 11 percent higher at Rp 11.9 trillion, the company said. Noodles comprised 35 percent of net sales, with flour and edible oil sales making up most of the remainder. Noodles sales volume grew 12 percent to 7.3 billion packs.

As of Sept. 30, Indofood's dollar-denominated debt totaled $459 million, of which $301.8 million matures from 2005.

Indofood is 48 percent owned by Hong Kong-listed First Pacific. Co., the investment vehicle for Indonesia's Salim family. While the Salims lost many of their businesses in the 1997-98 Asian crisis, they have managed to retain control of Indofood, one of the country's most profitable businesses.

Indofood is among a select band of Indonesian companies that have been able to issue foreign bonds this year despite an overall pessimistic view of Indonesia among international investors.