Indofood's sales jump by 35 percent

JAKARTA (JP): Salim Group's publicly-listed noodle maker PT Indofood Sukses Makmur reported a 35 percent increase in sales to Rp 2.8 trillion (US$745.95 million) in 1996.

The company's net profit also rose to Rp 351 billion last year, the company announced yesterday.

Indofood's chief executive officer Eva Riyanti Hutapea attributed the significant sales improvement to increased sales of noodles and snack foods.

Hutapea said Indofood's consumer food business made up 64 percent of last year's sales, totaling Rp 1.8 trillion, while flour milling made up 36 percent at a total of Rp 1 trillion.

"The sales volume of 7.3 billion packs of noodles and 10,935 tons of snack foods reached record highs last year," she said, adding that baby food and flour maintained their volumes at 5,912 tons and 2.6 million tons last year.

Hutapea said operating efficiencies had boosted Indofood's operating profit by 40 percent last year to Rp 523 billion.

"With the increase in operating profit, our operating margins improved to 18.49 percent in 1996 from 17.87 percent in 1995," she said.

Consumer food contributed 68 percent of the total amount of operating profit and flour milling 32 percent, she said.

Indofood also improved its cash position at the end of last year to Rp 500 billion, she said.

Shareholder's equity reached Rp 1.7 trillion against the long term debt of Rp 1.8 trillion. "The ratio of the company's current assets against current liabilities is now at 2:1," Hutapea said.

Indofood had earlier proposed to acquire 80 percent equity in six companies of Salim Group's edible oils and fat, oil palm plantations and consumer product distribution operations.

Acquisition costs were reduced to Rp 1.5 trillion from Rp 1.7 trillion when Salim Group cut the price on the purchase of palm plantations to give more value to the public shareholder.

The price for the oil palm plantations was reduced to Rp 1.05 trillion from Rp 1.25 trillion.

The new acquisition price was an average of 8.9 times this year's prospective earnings, Hutapea said.

She said Indofood estimated the additional companies would contribute a 45 percent net profit growth this year and would boost its earning per shares to exceed 20 percent after the proposed rights issue. (02)