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MYOR
MYOR, capital payouts surge
🎯 🍭 📈 Rp4,311
Last 12 months cashflow +Rp1.245 ⬆️
August 28th, 2020
⏰ 1 minute read
⏰ 1 minute read
Watch! Our 3 minute explainer using the data file & model ⬇️
Sales
Sales in the 2Q were down -6% to Rp5.7tn, just below our forecast Rp5.74tn. This is the third quarter out of 4 of negative growth as growth has slowed. Domestic & export sales were both down -6%. But sales did increase from the 1Q & we now expect growth to accelerate again to 8.9%, Rp25.2tn in the next 12 months.
Cashflow
Free cashflow in the 2Q was Rp338bn excluding working capital. That almost exactly matches with our forecast of Rp397bn. Cashflow has been improving recently despite slower sales as investment spending slowed down. With our forecast for stronger sales growth & continued lower investment spending, we expect cashflow to rise to an average Rp428bn per quarter in the next 12 months.
Sales in the 2Q were down -6% to Rp5.7tn, just below our forecast Rp5.74tn. This is the third quarter out of 4 of negative growth as growth has slowed. Domestic & export sales were both down -6%. But sales did increase from the 1Q & we now expect growth to accelerate again to 8.9%, Rp25.2tn in the next 12 months.
Cashflow
Free cashflow in the 2Q was Rp338bn excluding working capital. That almost exactly matches with our forecast of Rp397bn. Cashflow has been improving recently despite slower sales as investment spending slowed down. With our forecast for stronger sales growth & continued lower investment spending, we expect cashflow to rise to an average Rp428bn per quarter in the next 12 months.
Faster sales, lower investment, net cash ahead, soaring payouts, higher share price...
Balance sheet
The balance sheet is in net debt because of the previous investment spending. But as cashflow has recently improved, net debt has dramatically reduced. From as high as Rp5tn in 2018 to only Rp880bn as of the 2Q. With our forecast positive cashflow & a higher Rp612bn dividend, net debt will turn to Rp222bn net cash in 12 months time.
Profit
While sales dropped -6%, net profit fell -96% because of the reversal of 1Q FX gains as the rupiah strengthened. The cash cost ratio of net profit add depreciation & FX minus sales as a % of sales improved to 88%, bringing the 12 months cost ratio to 89%. We use 89% to predict a 12 months profit Rp2.3tn, +7.2%.
Value
Excitingly, post investment cycle, MYOR capital payouts will now soar with faster growth. At the current Rp49.2tn it’s trading 1.88x sales, 2.55x assets & 3.91x equity with a profitability of 18.5% & a yield of 1.2%. Our slightly lower cashflow forecast Rp1.7tn at 1.6% with a lower adjustment 0.9 as the debt turns to cash, gives a higher target Rp4,311.
The balance sheet is in net debt because of the previous investment spending. But as cashflow has recently improved, net debt has dramatically reduced. From as high as Rp5tn in 2018 to only Rp880bn as of the 2Q. With our forecast positive cashflow & a higher Rp612bn dividend, net debt will turn to Rp222bn net cash in 12 months time.
Profit
While sales dropped -6%, net profit fell -96% because of the reversal of 1Q FX gains as the rupiah strengthened. The cash cost ratio of net profit add depreciation & FX minus sales as a % of sales improved to 88%, bringing the 12 months cost ratio to 89%. We use 89% to predict a 12 months profit Rp2.3tn, +7.2%.
Value
Excitingly, post investment cycle, MYOR capital payouts will now soar with faster growth. At the current Rp49.2tn it’s trading 1.88x sales, 2.55x assets & 3.91x equity with a profitability of 18.5% & a yield of 1.2%. Our slightly lower cashflow forecast Rp1.7tn at 1.6% with a lower adjustment 0.9 as the debt turns to cash, gives a higher target Rp4,311.
