## AMRT, paying out capital

Current, target price Rp880, 1,413 (+61%)

Last, next 12-months cashflow +Rp 2.1, +1.9 trillion

March 30th, 2021

1 minute read

Sales, growth to accelerate

Rp 2 trillion Cashflow

1 minute read

Sales, growth to accelerate

- Sales increased 6% in the fourth quarter to reach Rp 19.5 trillion which is 1% ahead of our forecast.
- This is after a -2% decline in the third quarter & brings the average quarterly growth to +1%.
- We expect faster average growth of 5% in this next 12 months, bringing sales to Rp 22.8 trillion by the fourth quarter 2021.

Rp 2 trillion Cashflow

- Cashflow was strong again at Rp 1.56 trillion in the fourth quarter, from Rp 2.79 trillion in the third quarter.
- The quarterly average cashflow is now at Rp 514 billion.
- Assuming a lower investment spending of Rp 781 billion a quarter & higher sales gives a similar average quarterly free cashflow of Rp 469 billion in this next 12 months.

## Sales growth to accelerate, strong cashflow now, paying out capital, higher target price...

Balance sheet de leverage

Profit, improving margins

Value, paying out capital

- With positive cashflow the net leverage of cash minus total liabilities was -Rp 14.5 trillion in the fourth quarter from -Rp 15.4 trillion in the third quarter, -Rp 13.2 trillion a year ago.
- With our forecast higher cashflow & assuming a dividend payout of Rp 460 billion...
- ...the net cash will be at -Rp 12.7 trillion in 12 months time.

Profit, improving margins

- Net profit was higher at Rp 430 billion in the fourth quarter from Rp 151 billion in the third quarter.
- The cash costs ratio of net profit add depreciation minus sales as a percent of sales improved to 94%.
- We use the same 94% to predict a doubling of net profit to Rp 2.3 trillion in this next 12 months.

Value, paying out capital

- AMRT has paid out capital of Rp 934 billion in the last six years.
- At the current market value of Rp 36.5 trillion, it’s 39X capital paid, 0.42X sales, 1.4X assets, 3.9X equity with a 24% profitability & a 1.3% yield.
- Our cashflow forecast is Rp 1.88 trillion. At 1.6% with a 0.5X adjustment, gives a higher target price Rp1,413.