Rising Business Expenses Cause 52% Drop in Nippon Indosari's Profit

PT Nippon Indosari Corpindo Tbk continues to expand to broaden its market share. Not only in the domestic market, but this bread producer, with the brand Sari Roti, has even expanded into overseas markets. In the Philippines, this Indonesian bread company collaborates with Monde Nissin Corporation, and in South Korea with the Caffebene franchise.

However, the performance of the issuer, which has the trading code ROTI on the Indonesia Stock Exchange, is less than encouraging. Based on the financial reports published as of September 2017, Nippon Corporation's assets grew by 6% from the previous September.

Meanwhile, ROTI's net sales for the first nine months of 2017 decreased by 0.65% to Rp 1.83 trillion. In fact, the net profit of Indonesia's largest bread company shrank by 53% to Rp 97.35 billion due to a 20% increase in operating expenses to Rp 806.87 billion. Similarly, operating cash flow also fell by 42% to Rp 154.67 billion.