Unilever Indonesia's products include Rinso detergent, Bango sweet soy sauce and the ubiquitous Sariwangi tea. (Photo courtesy of Unilever Indonesia)
Unilever Indonesia Hardly Misses Blue Band as Profit, Sales Go Up
BY :JAKARTA GLOBE
JANUARY 31, 2020
Jakarta. Unilever Indonesia, a listed local arm of Rotterdam-based fast-moving consumer goods giant Unilever, saw its net income rise 9.3 percent on an adjusted basis last year from a year earlier, as the 2018 divestment of its margarine and spreads unit, including the famous Blue Band brand, left no dent in the company's sales.
Unilever Indonesia reported a Rp 7.4 trillion ($543 million) net income in 2019, the company said in a statement on Friday – down from Rp 9.1 trillion in 2018. But the latter amount still included a nonrecurring gain Rp 2.1 trillion from the sale of its margarine and spreads unit and a Rp 200 billion profit from the unit.
Without taking into account the proceeds from the sale and the margarine unit's profit in 2018, the company's net income increased by 9.3 percent in 2019, Unilever Indonesia said in the statement.
The sale, which included the middle-class Indonesian family staple Blue Band margarine brand, was part of parent company Unilever's decision to divest its margarine and spreads units around the world to US private equity firm KKR.
At the time, Unilever argued it needed to focus on faster-growing products.
The decision seemed warranted, at least for its Indonesian subsidiary, which reported net sales of Rp 42.9 trillion last year, up 4.8 percent on an unadjusted basis.
Excluding the margarine and spreads unit's results, the growth was even more pronounced at 5.8 percent.
Sancoyo Antarikso, director and corporate secretary of Unilever Indonesia, attributed the sales increase to diverse initiatives and innovations that the company implemented last year.
"We are committed to improving our long-term financial performance by striking a balance between growth and margins through a sustainable business model," Sancoyo said.
"The company continues to offer a series of innovations in its various business lines so our products and services remain relevant to our customers. We believe these efforts will have a positive effect on our long-term financial performance," he said.
Unilever Indonesia's home and personal care products, which include brands like Rinso, Molto and Lifebuoy, accounted for 69 percent of the company's total sales last year. The rest came from its food and refreshment products, which include Bango sweet soy sauce, Sariwangi tea and Cornetto ice cream.
Unilever Indonesia now has a total of 42 brands and operates nine factories in Cikarang, West Java, and Rungkut in East Java. All of the company's factories have obtained halal certificates from the Indonesian Ulama Council (MUI).