Pan Brothers profits up 50 percent on rising sales

JAKARTA. Publicly listed PT Pan Brothers, one of Indonesia’s major garment manufacturers, managed a substantial boost in profits on the back of surging domestic sales and Asian exports.

Pan Brothers announced in its latest financial results published on the Indonesia Stock Exchange (IDX) website on Thursday evening that the company managed to boost its profits to US$10.45 million, or 50.79 percent higher than the $6.93 million a year before. 

The profit growth was supported by an 18.53 percent year-on-year increase in its sales, which went up to $339.72 million last year, from $286.61 million in the previous year.

The publicly listed company used to produce almost entirely for European brand-name clients, but it has started to ship some of its products to the burgeoning Asian market to help cushion a slowdown in its conventional export markets.

The company has also continued to book higher sales in the domestic market, growing much faster than that of its overseas trade.

The company’s total exports rose 13.39 percent to $323.29 million last year, up from the $285.11 million it generated in the previous year. In stark contrast, its domestic sales skyrocketed by around tenfold to $16.4 million, from the $1.52 million it recorded in the previous year.

Asian countries accounted for 40 percent of Pan Brothers’ sales, followed by Europe and the US with 20 percent each. Its sales to the Asian market recorded most growth compared to other export destinations, up nearly 40 percent to $132.55 million last year, from $95.15 million in 2012, effectively replacing Europe as the company’s main market.

The company’s sales to the US went up by 25 percent year-on-year to $101.78 million, from the $88.17 million it booked in 2012. Its sales to Europe grew only by 2.19 percent to $102.69 million in 2013, compared to $100.49 million in 2012.

Its total operating expenses went up by 34.53 percent to $18.78 million last year from $13.96 million to 2013.

The company currently has four production facilities: two in Tangerang, Banten; one in Sragen and one in Boyolali, both in Central Java. The four facilities have a total production capacity of 31.2 million pieces per annum.

The facilities produce garments for global brands, such as Nike, Adidas and The North Face, as well as the company’s own brand.