Jardine Matheson's net profit tumbled 13% to $973.4m in H1

Blame it on Astra's reduced rupiah earnings.

Jardine Matheson reported that its net profit tumbled 13% year-on-year to $973.4 (US$709m) in the first half.

The decline was mainly due to lower contributions from Astra, whose lower revenue was exacerbated by the weak rupiah.

Astra continued to face slowing economic growth in Indonesia resulting from soft demand and weak commodity prices.

Its automotive operations in particular saw reduced activity which, when coupled with discounting in the motor car market caused by manufacturing overcapacity, had a negative impact on earnings. Of Astra’s business segments, only heavy equipment and mining produced an increase in earnings. 

“Many of the Group’s businesses are being affected by economic conditions in the region that are proving less strong than those seen in recent years, which has led to an overall decline in underlying profit in the first half. Astra’s reduced rupiah earnings were further impacted on consolidation by a weaker exchange rate. The more challenging conditions experienced in the first half are expected to continue for the remainder of the year,” Jardine Matheson said in a statement.