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TINS, back to profit
Current, target price Rp1,810, 2,889 (+60%)
May 7th, 2021
1 minute read
Sales, continue lower
Cashflow, but strong cashflow
1 minute read
Sales, continue lower
- Sales declined by -27% in the first quarter to 2,446 billion rupiah, which is -26% compared to our forecast.
- This is after a -14% decline in the fourth quarter & brings the quarterly average growth to -13%.
- We predict faster average growth of 8% a quarter in this next 12 months which will bring sales to 3,219 billion rupiah by the first quarter of 2022.
Cashflow, but strong cashflow
- Cashflow was positive 723 billion rupiah in the first quarter after 124 billion rupiah in the fourth quarter on positive working capital & lower investment.
- Average quarterly cashflow is now at 856 billion rupiah.
- We use flat investment spending of -147 billion rupiah, which with higher sales, gives an average quarterly cashflow of 172 billion rupiah in this next 12 months.
Lower sales again, but profitability improving, strong cashflow pays down the debt, 12 month profit is back to plus, higher target price...
Balance sheet, big de leverage
Profit, return to profit
Value, still 60% upside
- With positive cashflow, the net leverage of cash minus total liabilities was -7,873 billion rupiah in the first quarter from -8,771 billion rupiah in the fourth quarter & -13,013 billion rupiah a year ago.
- With our forecast cashflow & assuming a dividend payout of -39 billion rupiah...
- ...net cash will be -7,223 billion rupiah in 12 months time.
Profit, return to profit
- Net profit was positive at 10 billion rupiah in the first quarter from -86 billion rupiah 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 -91%.
- We use -90% costs, to predict a 4X higher next 12 months profit of 393 billion rupiah.
Value, still 60% upside
- TINS cumulative net capital is at -3,674 billion rupiah from the last six years.
- At the current market value of 13,480 billion rupiah, based on forecasts it’s only 1.06 sales, 1.01X assets, 2.50X equity, with a 7.3% profitability & a 0.3% yield.
- Our free cashflow forecast is 689 billion rupiah. At 1.6% with a 0.5X adjustment, gives a 60% higher target price of 2,889 rupiah.
