INDOFOOD Agri Resources : 5JS 0% on Thursday (Feb 29) posted a net profit of 525.6 billion rupiah (S$45 million) for the second half ended Dec 31, 2023, up 1.5 per cent from 518 billion rupiah in the corresponding year-ago period.

Earnings per share stood at 377 rupiah, also inching up 1.5 per cent from 371 rupiah in H2 2022.

Revenue, however, fell by 13.7 per cent for the half year to 8.4 trillion rupiah from 9.7 trillion rupiah a year earlier.

For the financial year, revenue was down 10.1 per cent to 16 trillion rupiah from 17.8 trillion rupiah. Net profit went down 20.2 per cent, to 614.2 billion rupiah from 770 billion rupiah in 2022.

The agribusiness group noted in its bourse filing that this was due mainly to lower gross profit and losses from foreign exchange.

“The group’s gross profit declined 15 per cent in H2 2023 and 28 per cent in FY2023, mainly due to lower average selling prices of palm and edible oils and fats (EOF) products,” it said. It noted, however, that the decline was partly offset by higher sales volume of palm products.

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It also recognised a foreign-exchange loss of 1.7 billion rupiah in FY2023, mainly due to the translation of US dollar-denominated assets, reversing a gain of 66.6 billion rupiah a year earlier. The loss was mainly due to the strengthening of the rupiah against the US dollar.

The group expects commodity prices to remain “highly volatile amid uncertainties from weather conditions and geopolitical conflicts”, and for demand growth “to remain subdued due to weaker economic growth and challenging macroeconomic factors”.

It is confident that the EOF market in Indonesia will expand, in line with the increasing population and per capita income growth trends.

“We aim to focus on the growth and recovery of EOF sales volumes through competitive pricing strategies,” the group added.

The board of directors has recommended a first and final dividend subject to shareholders’ approval. The amount of the dividend, as well as the payable date, will be announced later.

A first and financial dividend of S$0.008 was declared for the corresponding period the year before.

Shares of Indofood Agri closed at S$0.275, down S$0.005 or 1.8 per cent, on Thursday before the news.