Consumer goods giant Unilever Indonesia posted a 0.91 percent year-on-year (y/y) drop in net sales to IDR 10.74 trillion (approx. USD $773 million) in the January-March 2018 period (down slightly from net sales worth IDR 10.84 trillion in the same quarter one year earlier). Meanwhile, the company's net profit fell 6.21 percent (y/y) to IDR 1.84 trillion (approx. USD $132 million) in Q1-2018.

The company's Q1-2018 net sales figure can be divided into domestic sales (IDR 10.13 trillion) and exports to abroad (a significantly smaller amount of IDR 609 billion). Both in terms of domestic sales and exports there occurred a contraction in the first quarter of the year.

This latest corporate earnings report also gives rise to concern that household consumption in Indonesia is yet to rebound. In full-year 2017 household consumption, which accounts for about 56 percent of Indonesia's total economic growth, remained below the 5 percent (y/y) level (a weak level for Indonesian standards). Initially it was expected to see a rebound in household consumption growth in the first quarter of 2018. However, the latest earnings report of Unilever Indonesia seems to indicate that household consumption is yet to rebound.

Still, Unilever Indonesia's sales and profit are expected to improve in the remainder of 2018 amid Indonesia's accelerating macroeconomic growth as well as the local elections in mid-2018 and the Asian Games in Q3-2018 (both events will give rise to an increase in the rotation of money in Indonesia).

Meanwhile, per 31 March 2018, Unilever Indonesia's assets totaled IDR 20.24 trillion (up 7.06 percent y/y), while the company's liabilities and equity reached IDR 13.23 trillion and IDR 7.01 trillion, respectively.

As a result of the decline in sales and profit shares of Unilever Indonesia were down 4.43 percent to IDR 48,550 a piece in the first trading session of the Indonesia Stock Exchange on Tuesday morning (24/04). The benchmark Jakarta Composite Index fell 1.19 percent in the same session.

Unilever Indonesia's parent company Unilever NV had earlier announced a 5 percent decline in sales to €12.6 billion in Q1-2018. This decline was primarily attributed to exchange rate losses as the euro gained ground against the US dollar, Brazilian real, Indonesian rupiah, and Indian rupee. Finance Director Graeme Pitkethly said that fundamentally Unilever NV's turnover actually strengthened 3.4 percent (y/y) as all the company's divisions showed growth, while there were almost no price increases.