NISP Flat growth for Japfa Comfeed (JPFA, Rp4,400)

· Japfa Comfeed revenue declined by only 3.3% YoY to Rp6.69tn in 1H10, and net income only increased by 3.8% YoY to Rp264.9bn in 1H10.
· The company’s gross profit was actually up by 10.2% YoY to Rp1.27tn thanks to a decline in cost of goods, however higher G&A expenses made operating profit decline by 10.0% YoY. The company was saved by lower tax expenses making net profit relatively flat.
· However on a quarterly basis, net income slumped by 40.8% QoQ as derivative losses of Rp37.7bn took a chunk out of operating income which was relatively flat with Rp248.8bn in 2Q10.