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TOWR dull with big negative cashflow, but should rebound
TOWR Current 1,030 Target 1,229 + 19%
Apr 24, 2022
1 minute read
Sales jumped 23%
Last 5 quarters
1% 3% 3% 4% 23%
Costs up profit down
Last 5 quarters
-37% -39% -35% -37% -43%
Cashflow big negative
Last 5 quarters billion rupiah
480, 483, 1,715, 303, -16,900
Balance sheet higher leverage
Last 5 quarters billion rupiah
-22,622 -24,538 -22,399 -21,969 -49,017
Capital raised worsened , a 19% higher target price
Last 5 quarters billion rupiah
-1,655 -981 356 -16,468 -19,361
Apr 24, 2022
1 minute read
Sales jumped 23%
Last 5 quarters
1% 3% 3% 4% 23%
- Sales jumped 23% in the fourth quarter to 2,568 billion rupiah 20% above our 2,137 billion rupiah forecast.
- This brings the average to 8% growth.
- We predict average growth of 2% in this next 12 months to bring sales to 2,750 billion rupiah in the fourth quarter 2022.
Costs up profit down
Last 5 quarters
-37% -39% -35% -37% -43%
- The cash cost ratio went from -37% to -43% profit from 908 to 836 billion rupiah in the fourth quarter.
- The average cost ratio is at -38% now.
- We use the average -39% cost ratio to predict a 1,277 billion rupiah profit in the fourth quarter 2022.
Cashflow big negative
Last 5 quarters billion rupiah
480, 483, 1,715, 303, -16,900
- Free cashflow went big negative from 303 to -16,900 billion rupiah in the fourth quarter with -17,225 billion rupiah investment spending.
- Average quarterly Cashflow is negative -3,600 billion rupiah now.
- We assume lower -464 billion rupiah investment spending which with higher sales gives 972 billion rupiah Cashflow in the fourth quarter 2022.
Balance sheet higher leverage
Last 5 quarters billion rupiah
-22,622 -24,538 -22,399 -21,969 -49,017
- Cash declined 18,774 to 4,750 billion rupiah in the fourth quarter.
- Liabilities increased 40,743 to 53,767 billion rupiah so net cash worsened -21,969 to -49,017 billion rupiah.
- With our forecast cashflow & a 0 billion rupiah equity payout -4,600 billion rupiah liabilities payment net cash will be -44,417 billion rupiah in 12 months time.
Capital raised worsened , a 19% higher target price
Last 5 quarters billion rupiah
-1,655 -981 356 -16,468 -19,361
- TOWR 28 quarter capital raised worsened -16,468 to -19,361 billion rupiah in the fourth quarter with 3,178 billion rupiah new liabilities, a -285 billion rupiah equity payout but will be -14,761 billion rupiah in12 months time.
- At the current market value of 51,293 billion rupiah based on our forecasts it’s at 0.8 X assets with a 17 years payback & a 0% yield.
- Our cashflow forecast is 3,600 billion rupiah which means an 14 X valuation. A 17 X valuation gives a 19% higher target price 1,229 rupiah.