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ANTM, making some money
🎯 ⛏ 📈 Rp1,447
Last 12-month cashflow +Rp 1,985BN ⬆️⬆️

November 5th, 2020
⏰ 1 minute read

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Sales
Sales growth was less negative at -13% in the 3Q from -51% in the 2Q. Sales jumped 119% from the 2Q to Rp 8.8TN which is 34% above our forecast. Nickel sales were up by 59% but gold stole the show with sales up 170%. We expect sales to rise further, +25.5% in this next 12 months to Rp 32.9TN.

Cashflow
Cashflow excluding working capital was very strong at Rp 1,574BN in the 3Q (but negative working capital partially offset this), above our forecast. Investment spending has declined to Rp 221BN a quarter. We use the same investment spending which when combined with our sales forecast gives an average quarterly free cashflow forecast of Rp 309BN in this next 12 months.

3Q sales did recover, maintaining positive cashflow, lower debt, higher share price...

Data & financial model
Balance sheet
The balance sheet has long been net debt, but recent strong cashflow has reduced the net debt from Rp 6TN in the 1Q to Rp 5.2TN in the 2Q, Rp 4.8TN in the 3Q. With our forecast for more positive cashflow & a Rp 338BN dividend payout, the net debt will fall further to Rp 3.9TN in 12 months time.

Profit
Net profit also doubled from the 2Q to Rp 751bn in the 3Q, helped by FX against. The cash cost ratio of net profit add back depreciation minus sales as a % of sales was 93%. Were use the average 94% to get a next 12 months profit forecast of Rp 1,125BN, up by 140% from the previous 12 months.

Value
ANTM has been raising capital, which has reached a cumulative Rp3.6TN . But recent cashflow has brought this down from Rp 6.3TN. At Rp 17.6TN, it’s 0.81X sales, 0.86X assets, 1.35X equity with a profitability of 5.7%, yield of 1.3%. Our cashflow forecast is now Rp 1,238BN. At 1.6% with a 0.45X adjustment gives a higher target price of Rp1,448.
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