PT Indofood's profit increases 45 percent

PT Indofood's profit increases 45 percent

JAKARTA (JP): Publicly listed food manufacturer PT Indofood
Sukses Makmur reported yesterday a 45 percent increase in its net
profit to Rp 240 billion (US$87.3 million) in the first six
months of 1997 compared to the same period last year.

Company chief executive officer, Eva Riyanti Hutapea, said
that for the first half of this year, Indofood had a 57 percent
increase in sales to Rp 2.2 trillion.

After including the newly acquired businesses, a more balanced
sales portfolio was achieved, including noodles (40 percent),
flour (24 percent), trade and distribution (21 percent), edible
oil and fats (9 percent) and other packaged food operations (6
percent), she said.

"Demand for Indofood's instant noodles continued to grow at an
encouraging rate of 14 percent to 4.2 billion packs in the first
half, confirming the strength of Indofood's brands," she said,
adding that the noodle industry grew by 8 percent last year.

The company's financial position on June 30 remained strong,
with liquidity over Rp 1 trillion, she said.

The debt to equity ratio stood at 2.22 to 1.

Hutapea said her company is closely monitoring the ongoing
rupiah fluctuations and the tightening of the liquidity by
monetary authorities.

"We have adopted and will continue to adopt appropriate
measures to minimize any negative effects including improvements
in operating efficiencies," she said.

She added that in the past the company had been able to secure
the dollar debt funding at attractive rates and had benefited
from Bank Indonesia's previous policy of the rupiah's steady
depreciation against the dollar.

Earlier in the year, Indofood had opted to only minimally
hedge its foreign exchange debts, she said.

Barring any unforeseen events, profits for 1997 were
originally projected to increase to over Rp 500 billion or 45
percent growth, she said.

"However, with the current situation, the company's profit
will be affected, despite improvements in its operating
efficiencies," Hutapea said.

She said that any exchange losses would be unrealized (paper)
losses as the company's dollar exposure was long-term and
liabilities would only fall due within the next five years. (icn)