Indonesian noodle maker Indofood CBP Sukses Makmur saw its operating earnings fall in the first half of the year, hurt by “challenges” in the agribusiness sector.

Operating profit in the six months to the end of June fell 18.1% to RP2.93trn (US$), the company reported yesterday (27 August). Operating margin declined to 10.9% from 14.5% on lower gross profit and higher operating expenses.

Indofood said gross margin, which fell to 24% from 27.4%, was due to a lower agribusiness performance.

Net income, however, grew 1.2% to RP1.70trn, while net sales were up 9.3% to RP26.86trn.

“The market condition in agribusiness sector continues to be challenging and will remain subdued in the short term, adversely impacting our agribusiness performance,” said president and CEO Anthoni Salim. “We remain positive on Indonesia’s future potential and will continue to focus on sustaining growth cautiously, in light of the recent development in the domestic macro economic condition.”

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