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What Investors Need to Know about Indofood Agri Resources Ltd’s Third-Quarter Results

Indofood Agri Resources Ltd (SGX: 5JS) released its third-quarter results on Thursday. The firm manufactures edible oils and fats products in Indonesia. Let’s take a quick look at the results.

For the latest quarter, revenue was at Rp3,602 billion, an increase of 17% year-on-year due to recovery in average selling prices and higher external sales from Edible Oils & Fats (EOF) Division.

Revenue from Plantation Division put on 31% year-on-year, mainly because of higher sales volume and average selling prices of palm products. On the other hand, revenue from EOF Division grew 7% on higher average selling prices for edible oil and fat products.

Net profit after tax grew 14% to Rp207 billion on the back of strong profit contribution from the Plantation Division on higher sales volume and commodity prices for palm products.

As of 30 September 2014, the firm had total borrowings of Rp10,378 billion and a cash balance of Rp3,815 billion. At the end of last year, it was at a lower net debt position as it had total debt of Rp8,795 billion and a cash hoard of Rp3,803 billion. Net debt-to-total-equity ratio increased from 0.22x as of last year end to 0.28x as of end September 2014.

Indofood Agri generated Rp850 billion in cash flow from operations for the latest quarter, an increase of around 40% year-on-year.

Going forward, the firm believes that domestic demand for palm oil in Indonesia will remain strong, given its vast and growing population base of more than 240 million people.

Shares at the agribusiness group closed at S$0.845 on Thursday, translating to 0.78x its latest book value.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.