PT Indofood posts net profit of Rp 150 billion

JAKARTA (JP): Food products producer PT Indofood Sukses Makmur recorded a net profit of Rp 150 billion (US$17.5 million) last year after a Rp 1.2 trillion loss in 1997, the company said on Tuesday.

Company chief executive officer Eva Riyanti Hutapea said the sharp increase in sales had helped it reap profits, despite the prolonged economic crisis.

The company suffered the 1997 massive loss mainly as a result of foreign exchange losses.

Eva said Indofood sales surged 77 percent to Rp 8.8 trillion last year despite a "downturn in demand".

She said 88 percent of last year's sales were contributed by four main operations, including the instant noodle manufacturing division with a contribution of Rp 2.9 trillion, or 34 percent of total sales, and the edible oil and fats manufacturing division with a contribution of Rp 2.1 trillion, or 24 percent of total sales.

The two other largest contributors were the flour division which contributed Rp 1.4 trillion, or 16 percent of total sales, and edible oil and fats trading which contributed Rp 1.2 trillion, or 14 percent of the sales.

The company recorded an operating income of Rp 2.1 trillion last year, as against Rp 854.9 billion in 1997 with the edible oils and fats division providing the largest contribution of Rp 910.8 billion, or 44 percent of the group's total operating income.

She said the company cash flow remained secure, citing cash and deposits totaling Rp 2.1 trillion by the end of 1998.

On the other hand, bank loans totaled Rp 8.5 trillion, most of which are in U.S. dollars.

She said Indofood had increased hedging in foreign currency exposure from 43 percent in December 1997 to more than 80 percent in 1998.

Eva said Hong Kong-based First Pacific Company and Japan's Nissan Food Products Company Ltd. had intended to acquire 60 percent of the shares of the Salim Group in Indofood, but the transaction had been canceled.

"The termination of the transaction will have no adverse impact on the company's operating performance, as Indofood is being managed independently and professionally," she said. (jsk)