Japfa Comfeed Q1 2025 slides: stable growth amid strong Ramadan demand

Introduction & Market Context

PT Japfa Comfeed Indonesia Tbk (IDX:JPFA), a leading Pan-Asian industrialized agri-food company, presented its Q1 2025 financial results on April 30, showcasing stable performance driven by increased demand during the Ramadan period. The company maintained its position as Indonesia’s second-largest poultry feed and day-old chick (DOC) producer in a market with significant long-term growth potential.

Indonesia’s poultry consumption remains significantly lower than neighboring countries, presenting substantial growth opportunities. At just 8.3 kg per capita, Indonesia lags behind regional peers like Malaysia (31.1 kg), Vietnam (15.7 kg), and the Philippines (10.1 kg).

As shown in the following chart comparing protein consumption across Asian markets:

Quarterly Performance Highlights

Japfa reported modest growth across all key financial metrics for Q1 2025. Revenue increased 2.9% year-over-year to IDR 14,332 billion (from IDR 13,925 billion in Q1 2024). Operating profit rose slightly to IDR 1,119 billion (up from IDR 1,115 billion), while EBITDA grew to IDR 1,433 billion (compared to IDR 1,396 billion). Net profit showed the strongest improvement, increasing 5.5% to IDR 754 billion.

The company’s financial performance reflects its ability to navigate market cyclicality, with the feed business continuing to serve as a pillar of profitability. The presentation highlighted that higher demand during Ramadan contributed to the stable results.

The following chart illustrates Japfa’s Q1 2025 financial performance compared to the previous year:

Notably, Japfa has significantly improved its balance sheet strength, with Net Debt/Equity ratio decreasing from 78.9% to 52.5% between March 2024 and March 2025. Total (EPA:TTEF) interest-bearing debt decreased from IDR 13,312 billion to IDR 10,819 billion during the same period.

The company’s financial track record demonstrates consistent improvement across key metrics:

Competitive Industry Position

Japfa maintains a strong competitive position in Indonesia’s animal protein sector, with 90% of its total revenue coming from poultry-related activities. The company’s revenue breakdown shows Poultry Feed contributing 39%, Commercial Farming 32%, Poultry Breeding 9%, Poultry Processing and Consumer Products 10%, Aquaculture 6%, and Trading and Others 4%.

The following chart illustrates Japfa’s revenue distribution and market position:

The company’s vertically integrated business model spans the entire value chain from upstream (animal feed production, breeding) to midstream (commercial farming) and downstream (processing, consumer products). This integration provides significant operational advantages and efficiency.

Japfa’s comprehensive value chain is depicted in this overview:

With operations across Indonesia, Japfa benefits from significant economies of scale and logistical advantages. The company operates 15 feed mills, 78 breeding farms, and 30 hatcheries nationwide, supported by approximately 120 company farms and around 9,000 contract farms.

The following map illustrates Japfa’s extensive nationwide footprint:

In terms of market share, Japfa holds the second position in Indonesia’s poultry feed market with 21% share (behind CP’s 32%) and in DOC production with 25% market share (behind CP’s 38%). The company also maintains strong positions in Vietnam and Myanmar.

The company’s market position across different regions is shown here:

Strategic Initiatives & Growth Plans

Japfa’s growth strategy focuses on leveraging its established platform, leading market position, and economies of scale. The company has identified three key future growth drivers: downstream business expansion, aquaculture development, and Vaksindo (its vaccine business).

The company’s industrialized approach provides several competitive advantages, including scale, advanced technology and genetics (through an exclusive relationship with Aviagen), robust biosecurity measures, and standardized farming practices that can be replicated across operations.

Japfa’s cost-plus pricing model enables the company to pass on most commodity and foreign exchange currency fluctuations, helping to manage cyclicality in the agribusiness sector.

The presentation also highlighted Japfa’s sustainability journey, including the completion of its ninth water recycling facility and alignment with the United Nations Sustainable Development Goal No. 2 (Zero Hunger) through its focus on providing affordable protein foods.

Financial Outlook

Looking ahead, Japfa appears well-positioned to navigate market challenges while pursuing growth opportunities. The company’s capital expenditure has been managed carefully, with CAPEX decreasing from IDR 1,984 billion in FY2023 to IDR 1,599 billion in FY2024, and standing at IDR 381 billion for Q1 2025.

Despite global macroeconomic challenges including trade tensions and cost-of-living pressures, Japfa expressed confidence in its ability to ride through cycles by maintaining operational efficiency and low-cost production.

The company’s historical growth and CAPEX trends provide context for its development trajectory:

With a strong balance sheet, established market position, and clear growth strategy, Japfa appears well-positioned to capitalize on Indonesia’s growing protein consumption market while managing industry cyclicality.

Full presentation:

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