Indofood Agri Resources (5JS) H1 2023 earnings summary

Executive summary

• H1 2023 revenue fell 5.8% YoY to Rp7,608bn; net profit declined 82.9% to Rp92.7bn, mainly due to lower palm-product prices and plantation profitability.

• Core profit after tax was Rp172.5bn, down 78.9% YoY, excluding specified FX, biological fair-value, plasma ECL, impairment and rationalisation effects.

Financial highlights

• Gross profit fell 43% YoY to Rp1,233bn; gross margin was 16.2% versus 26.8%, and adjusted EBITDA declined 36% to Rp1,291bn.

• Operating profit declined 60.5% to Rp467.6bn; pretax profit was Rp241.0bn versus Rp947.1bn.

• Net profit attributable to owners was Rp88.6bn, down 64.8% YoY; basic and diluted EPS were Rp64, down 64.8%.

• Net profit margin was 1% versus 7%; EBITDA margin was 17% versus 25%.

Outlook and guidance

• Plantation priorities include replanting older palms, infrastructure improvements, active crop management, innovation and mechanisation to lift yields, plus cost control and digitalisation.

• EOF priorities include growing sales volumes through competitive pricing, refreshing cooking oil formats and packaging, and targeted promotions and advertising.