Sampoerna's profit up, Gudang Garam's down

Sampoerna's profit up, Gudang Garam's down

Agencies, Jakarta

The country's cigarette producer PT Hanjaya Mandala Sampoerna said on Friday that its first-quarter net profit rose 32 percent to Rp 753 billion from Rp 569 billion a year earlier due to an increase in sales.

Sales rose 24 percent to Rp 4.44 trillion from Rp 3.58 trillion a year earlier because of higher sales volume.

During the quarter, Sampoerna sold 11.3 billion sticks of cigarettes, up 14 percent from Rp 9.9 billion a year earlier.

It said its unit PT Panamas had started distributing Philip Morris-branded cigarettes since March 1 and this had significantly boosted the Sampoerna Group's standing with its wholesale clients.

Philip Morris International Inc., a unit of the world's biggest tobacco company, Altria Group Inc., said last month it will pay $2 billion to buy a 40 percent stake in Jakarta-listed Sampoerna from a group of major shareholders, including the company's chairman, Putera Sampoerna.

Philip Morris is making a general offer for the rest of Sampoerna which, if fully accepted, will lift the value of the total acquisition to $5.2 billion, including around $160 million in debt.

Sampoerna's competitor PT Gudang Garam, Indonesia's biggest cigarette maker, said its first-quarter profit fell 2 percent after sales of clove cigarettes declined and interest costs increased.

Net income fell to Rp 511.7 billion ($53 million) from Rp 524.5 billion a year earlier, the Kediri, East Java-based company said today in a statement to the Jakarta Stock Exchange. Sales fell 3 percent to Rp 5.85 trillion.

The company's interest costs increased to Rp 111 billion from Rp 71.8 billion, it said. Gudang Garam's short-term loans doubled to Rp 4.32 trillion as of the end of March from Rp 2.17 trillion in the same period a year earlier.

Gudang Garam competes with Sampoerna which was recently bought by Altria Group Inc.'s Philip Morris division.