## ACST, sales finally grow

Target price Rp565

Last 12-month cashflow +Rp 1.52 trillion

February 25th,, 2021

1 minute read

Sales

Cashflow

1 minute read

Sales

- Sales finally increased by 14% in the fourth quarter to Rp 243 billion after -22% in the third quarter, -43% in the second quarter.
- Sales were still far, 40% below our forecast.
- Average quarterly growth is at -24%. We expect the average growth to turn positive +31% & sales to reach Rp 704 billion by the fourth quarter of 2021.

Cashflow

- Cashflow was still negative -Rp 217 billion in the fourth quarter after -Rp 308 billion in the third quarter.
- Average quarterly Cashflow is positive +Rp 380 billion because of working capital.
- Investment spending is close to zero. We expect this to continue & with higher sales, average quarterly Cashflow in this next 12 months will be positive +Rp 20 billion.

## Sales finally grow, expecting higher sales, positive margins, some cashflow & a higher target price...

Balance sheet

Profit

Value

- The balance sheet net of cash minus total liabilities improved to -Rp 2.65 trillion in the fourth quarter from -Rp 2.7 trillion in the third quarter & -Rp 10 trillion a year ago.
- With our forecast for some positive free cashflow & assuming there is no dividend payout...
- ...net cash will be at -Rp 2.58 trillion in 12 months time.

Profit

- The net loss was -Rp 587 billion in the fourth quarter up from -Rp 503 billion in the third quarter.
- The cash costs ratio of net profit add back depreciation minus sales as a percent of sales was at 328%!
- We used 96% costs as sales recover to predict a smaller next 12 months net loss of Rp 47 billion.

Value

- ACST has raised Rp 2.79 trillion of capital in the last six years.
- At the current market value of Rp 2 trillion, it’s at 1X sales, 0.69X assets, 7.3X equity with no profitability or yield yet.
- Our (fourth quarter annualized) Cashflow forecast is Rp 116 billion. At 1.6% with a 0.5X adjustment, this gives a higher target price of Rp565.