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MNCN, sales soar to a record
Current, target price 825, 2,949 (+257%)
August 20th, 2021
1 minute read
Sales soar to a record
Costs lower
1 minute read
Sales soar to a record
- Sales jumped by 27% in the second quarter to a record 2,723 billion rupiah which is above our forecast 2,354 billion rupiah.
- This brings the average quarterly growth to 9%.
- We predict average growth of 3% a quarter in this next 12 months which will bring sales up to 2,996 billion rupiah by the second quarter of 2022.
Costs lower
- The cash cost ratio of net profit add non cash costs minus sales as a percent of sales was down to -62% & profit doubled to 843 billion rupiah in the second quarter.
- Average costs are now at -68%.
- As Cashflow costs are higher we use a higher -72% cost ratio to predict a 696 billion rupiah profit in the second quarter of 2022.
Cashflow more than doubled
Balance sheet, lower leverage
Value, only 2X the capital paid
- Cashflow more than doubled to 639 billion rupiah in the second quarter even with higher investment spending of -232 billion rupiah.
- 12 month average quarterly Cashflow is now at 192 billion rupiah but the first half average is 460 billion rupiah.
- We use the same investment spending of -232 billion rupiah which with higher sales gives a 598 billion rupiah Cashflow in the second quarter of 2022.
Balance sheet, lower leverage
- With such positive cashflow, cash increased from 713 to 870 billion rupiah.
- With debt payments, liabilities declined from 4,073 to 3,659 billion rupiah so net cash improved from -3,360 to -2,789 billion rupiah.
- With our forecast strong cashflow & a -734 billion rupiah equity payout, net cash will be -1,395 billion rupiah in 12 months time.
Value, only 2X the capital paid
- MNCN capital from the last six years started to increase again to 5,231 billion rupiah in the second quarter.
- At the current market value of 10,910 billion rupiah, based on our forecasts, it’s at 1.01X sales & 0.52X assets with a 7% yield.
- Our cashflow forecast is 2,053 billion rupiah which makes the current valuation 5.3X. At a forecast 19X (a 5.3% yield) this gives a 257% higher target price of 2,949 rupiah.
