EXCL, only 0.38X assets
Target price Rp8,773
Last 12-month cashflow +Rp 3.25 trillion
February 15th,, 2021
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- Sales declined in the fourth quarter -1% to Rp 6.35 trillion after +2% growth in the third quarter & were 4% below forecast.
- Digital sales declined even more, -3%. Average quarterly growth is at +4%.
- We expect the same 4% average growth in this next 12 months & sales to rise to Rp 7.3 trillion by the fourth quarter 2021.
- Cashflow turned negative -Rp 1.15 trillion in the fourth quarter on negative working capital after +Rp 1.6 trillion in the third quarters .
- Average quarterly Cashflow is now Rp 813 billion.
- Investment spending was Rp 1.6 trillion. We use this same spending, which with higher sales gives an average quarterly Cashflow of Rp 748 billion in this next 12 months.
Sales growth, cashflow, profit negative, but expecting a return to positive, only 0.38X assets, much higher target price...
- The balance sheet leverage of cash minus total liabilities was higher at -Rp 45.5 trillion in the fourth quarter from -Rp 44.5 trillion in the third quarter & -Rp 42 trillion a year ago.
- With our forecast for more positive free cashflow & a higher dividend Rp 560 billion....
- ...net cash will be -Rp 41.4 trillion in 12 months time.
- There was a -Rp 1.7 trillion net loss in the fourth quarter from +Rp 331 billion profit in the third quarter on high non-cash costs.
- The cash cost ratio of net profit add non-cash costs minus sales as a percent of sales was low at 46%.
- We use 59% costs to predict a next 12 months profit, Rp 1.9 trillion.
- EXCL has paid our capital of Rp 12.6 trillion in the last six years.
- At the current market value of Rp 24.7 trillion, it’s 1.97X capital paid, 0.89X sales, 0.38X assets, 1.21X equity with a 9% profitability & a 2.3% yield.
- Our cashflow forecast is Rp 2.98 trillion. At 1.6% with a 0.5X adjustment gives a higher target price, Rp8,773.