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POWR, a high yield
Current, target price Rp710, 3,181 (+348%)
Target price Rp2,908

  • Sales up again,
  • strong margins,
  • rising cashflow,
  • lower leverage,
  • an 8.5% yield...
June 3rd, 2021
1 minute read

Sales, up again
  • Sales increased by 4% in the first quarter to 129 million dollars, which is +6% compared to our forecast.
  • This is after a 13% increase in the fourth quarter & brings the quarterly average growth to 1%.
  • We predict average growth of 5% a quarter in this next 12 months which will bring sales to 154 million dollars by the first quarter of 2022.

Cashflow, positive & higher
  • Cashflow was positive 50 million dollars in the first quarter after positive 3 million dollars in the fourth quarter on investment gains.
  • Average quarterly cashflow is now positive 34 million dollars.
  • We use investment spending of -12 million dollars, which with higher sales, gives a higher average quarterly cashflow of 36 million dollars in this next 12 months.
Balance sheet, lower leverage
  • With positive cashflow, the net leverage of cash minus total liabilities was -341 million dollars in the first quarter from -400 million dollars in the fourth quarter & -395 million dollars a year ago.
  • With our forecast higher cashflow & assuming a dividend payout of -68 million dollars...
  • ...net cash will be -265 million dollars in 12 months time.

Profit, strong margin trend
  • Net profit was lower at 20 million dollars in the first quarter from 26 million dollars in the fourth quarter on FX losses.
  • The cash cost ratio of net profit add back non cash costs minus sales as a percent of sales was up to -70%.
  • We use average -67% costs, to predict a higher next 12 months profit of 135 million dollars.

Value, an 8.5% yield
  • POWR cumulative net capital is at +131 million dollars from the last five years.
  • At the current market value of 799 million dollars, based on forecasts it’s 2.9 capital paid, 1.4 sales, 0.6 assets, 1.1 equity, with a 17.8% profitability & a 8.5% yield.
  • Our free cashflow forecast is 143 million dollars. At 1.6% with a 0.4X adjustment, gives a 348% higher target price of 3,181 rupiah