Other stocks here
MDKA, raising equity while cutting investment doesn’t make sense
Current, target price Rp2,610, 1,115 (-57%)
May 19th, 2021
1 minute read
Sales, up but less than expected
Cashflow, still negative even with low investment
1 minute read
Sales, up but less than expected
- Sales jumped back 83% in the first quarter to 47 million dollars, but not as much as expected, -27% compared to our forecast.
- This is after a -74% decline in the fourth quarter & brings the quarterly average growth to 1%.
- We predict average growth of 21% a quarter in this next 12 months which will bring sales to 99 million dollars by the first quarter of 2022.
Cashflow, still negative even with low investment
- Cashflow was negative -31 million dollars in the first quarter after negative -24 million dollars in the fourth quarter, despite low investment.
- Average quarterly cashflow is now also negative -8 million dollars.
- We use flat investment spending of -3 million dollars, which with higher sales, gives a positive average quarterly cashflow of 14 million dollars in this next 12 months.
Sales recover, but less than forecast, cashflow negative despite lower investment, raising equity doesn’t make sense, expensive, lower target price...
Balance sheet, new equity
Profit, margins back up
Value, lower target price
- With mew equity, the net leverage of cash minus total liabilities was -162 million dollars in the first quarter from -315 million dollars in the fourth quarter & -344 million dollars a year ago.
- With our forecast positive cashflow & assuming a dividend payout of -5 million dollars...
- ...net leverage will be -86 million dollars in 12 months time.
Profit, margins back up
- The net loss was lower at -6 million dollars in the first quarter from -22 million dollars in the fourth quarter.
- The cash cost ratio of net profit add back non cash costs minus sales as a percent of sales was down to -69%.
- We use the same -69% costs, to predict a slightly higher next 12 months profit of 10 million dollars.
Value, lower target price
- MDKA cumulative net capital is now up to -557 million dollars from the last six years.
- At the current market value of 4,082 million dollars, based on forecasts it’s 13.58X sales, 1.80X assets, 5.61X equity, with a 1.4% profitability & a 0.1% yield.
- Our free cashflow forecast is 55.8 million dollars. At 1.6% with a 0.5X adjustment, gives a -57% lower target price of 1,115 rupiah.
