Strong Growth Profit and Sales Unilever Indonesia in Q1-2015
One of Indonesia’s largest consumer goods producers, Unilever Indonesia, recorded better than expected sales and net profit growth in the first quarter of 2015, signalling that purchasing power of Indonesians - amid the country’s economic slowdown - may not be as weak as previously expected. The local unit of Netherlands-based Unilever Holding B.V. attributed its strong performance to lower finance costs (interest and other borrowing costs), rising sales, and a higher average selling price.
Net profit of Unilever Indonesia was IDR 1.59 trillion (USD $122.3 million) in the first quarter of 2015, up 16.9 percent from the same quarter last year. Meanwhile, the company’s net sales grew 7.8 percent to IDR 9.41 trillion (USD $723.8 million) over the same period.
The company’s finance costs plunged 30.4 percent to IDR 33 billion (USD $2.5 million) compared to the costs in last year’s first quarter. Unilever Indonesia managed to reduce its outstanding bank loans to IDR 100 billion (USD $7.7 million) at the end of the first quarter of 2015, down significantly from IDR 1.25 trillion (USD $96 million) at the end of 2014. The remaining bank loan is from Deutsche Bank AG (Jakarta) and carries an interest rate of 7.65 percent.
Unilever Indonesia also posted strong corporate results as it managed to raise the average selling prices of its products by one percent in Q1-2015. Throughout 2014, the company had raised the average selling price by approximately 8 percent in an effort to offset a possible sales volume decline amid Indonesia’s slowing economic growth pace. Indonesia, Southeast Asia’s largest economy, saw its economic growth slow to a five-year low of 5.02 percent (y/y) in 2014. Growth forecasts for Indonesia’s economy in 2015 only indicate a slight improvement. However, as the products of Unilever Indonesia are mostly sourced from oil-related materials, the company is one of the beneficiaries of worldwide low oil prices.
However, Unilever Indonesia’s royalty fee (to its parent company) has gradually increased in recent years from a maximum of 5 percent in 2013 to 8 percent in 2015. But lower costs due to current low oil prices will be able to compensate for this royalty fee hike.
Shares of Unilever Indonesia have climbed 29.3 percent between the year-start and 23 April 2015.
Stock Quote Unilever Indonesia - UNVR:
The brand portfolio of Unilever Indonesia, one of the largest companies listed on the Indonesia Stock Exchange in terms of market capitalization, includes home & personal care products and foods & refreshment products such as Dove, Blue Band, Wall’s, Pepsodent and Rexona.
Unilever Indonesia's Financial Highlights:
| 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | |
| Net Sales | 15,578 | 18,247 | 19,690 | 23,469 | 27,303 | 30,757 | 34,512 |
| Gross Profit | 7,631 | 9,042 | 10,205 | 12,006 | 13,889 | 15,778 | 17,099 |
| Net Income | 2,407 | 3,044 | 3,387 | 4,163 | 4,839 | 5,353 | 5,739 |
| Operating Income |
3,431 | 4,215 | 4,543 | 5,568 | 6,498 | 7,164 | 7,762 |
| Profit before Tax | 3,448 | 4,249 | 4,546 | 5,575 | 6,467 | 7,158 | 7,677 |
| EBITDA | 3,574 | 4,474 | 4,832 | 5,929 | 6,857 | 7,675 | |
| Total Assets | 6,505 | 7,485 | 8,701 | 10,482 | 11,985 | 12,703 | 14,281 |
| Total Liabilities | 3,398 | 3,776 | 4,652 | 6,801 | 8,017 | 8,449 | 9,682 |
| Basic Earnings per Share¹ |
315 | 399 | 444 | 546 | 634 | 701 | 752 |
| Cash Dividend per Share¹ |
315 | 399 | 444 | 546 | 634 | 701 |
in billion IDR rupiah unless otherwise stated
¹ in IDR rupiah
Source: Unilever Indonesia