## PTBA, 1.55X capital paid

🎯 ⛏ 📈 Rp7,375

Last 12-month cashflow +Rp 582 billion ⬇️

December 18th, 2020

1 minute read

Sales

Sales growth was negative again in the third quarter, -1% but better than -24% in the second quarter. At Rp 3.84 trillion, sales were 6% below our forecast Rp 4.1 trillion. 12 months average growth is -9% & we expect it to pick up sharply to +11% & sales to reach Rp 5.67 trillion by the third quarter next year.

Cashflow

Third quarter cashflow was positive again after a negative second quarter at +Rp 396 billion & close to our forecast of Rp 355 billion. We assume the recent average investment spending of Rp 379 billion continue & this combined with our higher sales forecast gives a higher average quarterly free cashflow of Rp 825 billion in this next 12 months.

1 minute read

Sales

Sales growth was negative again in the third quarter, -1% but better than -24% in the second quarter. At Rp 3.84 trillion, sales were 6% below our forecast Rp 4.1 trillion. 12 months average growth is -9% & we expect it to pick up sharply to +11% & sales to reach Rp 5.67 trillion by the third quarter next year.

Cashflow

Third quarter cashflow was positive again after a negative second quarter at +Rp 396 billion & close to our forecast of Rp 355 billion. We assume the recent average investment spending of Rp 379 billion continue & this combined with our higher sales forecast gives a higher average quarterly free cashflow of Rp 825 billion in this next 12 months.

## Sales to rebound, cashflow to rebound, only just over 1X capital paid, much higher target price...

Balance sheet

Post dividend, the net cash was at Rp 5.27 trillion in the third quarter down from Rp 8.5 trillion in the second quarter. With our forecast for a higher positive free cashflow ahead & assuming a similar dividend payout of Rp 3.3 trillion, the net cash position will be roughly the same at Rp 5.28 trillion in 12 months time.

Profit

Net profit was higher at Rp 441 billion in the third quarter from Rp 391 billion in the second. The cash cost ratio of net profit add depreciation minus sales as a percent of sales continues to improve to 83%. We assume with higher sales 76% which gives a next 12 months profit of Rp 3.9 trillion.

Value

PTBA has paid out capital of Rp 14.3 trillion in the last five years. At the current market value of Rp 22 trillion, it’s cheap, 1.55X capital paid, 1.07X sales, 0.88X assets, 1.28X equity with a 23% profitability & a 15% yield! Our cashflow forecast is Rp 3.3 trillion. At 1.6% with a 0.4X discount gives a target price Rp7,375.

Post dividend, the net cash was at Rp 5.27 trillion in the third quarter down from Rp 8.5 trillion in the second quarter. With our forecast for a higher positive free cashflow ahead & assuming a similar dividend payout of Rp 3.3 trillion, the net cash position will be roughly the same at Rp 5.28 trillion in 12 months time.

Profit

Net profit was higher at Rp 441 billion in the third quarter from Rp 391 billion in the second. The cash cost ratio of net profit add depreciation minus sales as a percent of sales continues to improve to 83%. We assume with higher sales 76% which gives a next 12 months profit of Rp 3.9 trillion.

Value

PTBA has paid out capital of Rp 14.3 trillion in the last five years. At the current market value of Rp 22 trillion, it’s cheap, 1.55X capital paid, 1.07X sales, 0.88X assets, 1.28X equity with a 23% profitability & a 15% yield! Our cashflow forecast is Rp 3.3 trillion. At 1.6% with a 0.4X discount gives a target price Rp7,375.