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CPIN, predicting cashflow catchup
🎯 🐔 📈 Rp8,678
Last 12-months cashflow +Rp 1.39 trillion ⬇️
December 7th, 2020
1 minute read
Sales
Sales had a big jump in the third quarter, +14% from the second quarter, +9% from a year ago. At Rp 15.68 trillion, sales were 12% ahead of forecast. Feed, broilers & day old chicks were up +20%, +13% & +22% while processed chicken was down -10%. We expected sales to rise to Rp 17.47 trillion by third quarter 2021.
Cashflow
Despite higher sales, cashflow was lower than we expected at Rp 345 billion in the third quarter excluding working capital. 12 months cashflow is Rp 1.4 trillion. We use the same lower quarterly investment spending as the third quarter which combined with higher sales gives an average quarterly free cashflow forecast of Rp 632 billion in this next 12 months.
1 minute read
Sales
Sales had a big jump in the third quarter, +14% from the second quarter, +9% from a year ago. At Rp 15.68 trillion, sales were 12% ahead of forecast. Feed, broilers & day old chicks were up +20%, +13% & +22% while processed chicken was down -10%. We expected sales to rise to Rp 17.47 trillion by third quarter 2021.
Cashflow
Despite higher sales, cashflow was lower than we expected at Rp 345 billion in the third quarter excluding working capital. 12 months cashflow is Rp 1.4 trillion. We use the same lower quarterly investment spending as the third quarter which combined with higher sales gives an average quarterly free cashflow forecast of Rp 632 billion in this next 12 months.
Sales jump, expecting stronger cashflow as investment slows, 1.8% dividend, higher target price...
Balance sheet
The third quarter balance sheet net debt was higher again at Rp 2.8 trillion because of the dividend payment, but still lower than Rp 3.1 trillion at the end of 2019. With our strong average cashflow forecast & a dividend payment of Rp 1.66 trillion, net debt will be down again to Rp 1.9 trillion again in 12 months time.
Profit
Net profit was slightly lower at Rp 628 billion in the third quarter as the cash costs ratio of net profit add back depreciation minus sales as a percent of sales was 2% higher at 95%. We use the recent average of 94% costs to predict the next 12 months profit will be also be slightly lower, Rp 3.3 trillion.
Value
CPIN has paid out Rp 8.5 trillion of capital in the last 5 years. At the current market value of Rp 93.1 trillion, it’s 11X capital paid, 1.37X sales, 2.93X assets, 3.83X equity with a 14% profitability & a 1.8% yield. Our cashflow forecast is Rp 2.53 trillion. At 1.6% with a bullish 0.9X adjustment gives a higher target Rp8,678.
The third quarter balance sheet net debt was higher again at Rp 2.8 trillion because of the dividend payment, but still lower than Rp 3.1 trillion at the end of 2019. With our strong average cashflow forecast & a dividend payment of Rp 1.66 trillion, net debt will be down again to Rp 1.9 trillion again in 12 months time.
Profit
Net profit was slightly lower at Rp 628 billion in the third quarter as the cash costs ratio of net profit add back depreciation minus sales as a percent of sales was 2% higher at 95%. We use the recent average of 94% costs to predict the next 12 months profit will be also be slightly lower, Rp 3.3 trillion.
Value
CPIN has paid out Rp 8.5 trillion of capital in the last 5 years. At the current market value of Rp 93.1 trillion, it’s 11X capital paid, 1.37X sales, 2.93X assets, 3.83X equity with a 14% profitability & a 1.8% yield. Our cashflow forecast is Rp 2.53 trillion. At 1.6% with a bullish 0.9X adjustment gives a higher target Rp8,678.
