Bukit Asam’s (PTBA) net profit fell 44%, analysts recommended

ILLUSTRATION. The coal mine owned by PT Bukit Asam (PTBA) in Tanjung Enim,

Reporter: Akhmad Suryahadi | Editor: Anna Suci Perwitasari

KONTAN.CO.ID – JAKARTA. The performance of PT Bukit Asam Tbk (PTBA) until the third quarter of 2020 is disappointing. Given, in the first nine months of this year, the state-owned company’s net profit fell 44% to Rp 1.7 trillion.

The decrease in net income is in line with the correction in net income PTBA. Until September 2020, PTBA posted net income of IDR 12.8 trillion, down 20.94% from the realization of net income in the same period in 2019 which reached IDR 16.25 trillion.

Research Head of Kresna Sekuritas Robertus Hardy said that the income PTBA in the third quarter it also fell 1.4% on a quarterly basis, from Rp 3.89 trillion in the second quarter to Rp 3.84 trillion.

However, the significantly lower general and administrative expenses succeeded in increasing Bukit Asam’s operating profit margin in the July-September 2020 period. PTBA in the third quarter, it rose 14% to Rp 439 billion from Rp 386 billion previously in the second quarter of 2020.

Also Read: The impact of coal gasification on Bukit Asam’s (PTBA) performance in the future

Robertus continued, the decline in PTBA’s revenue which reached 21% yoy occurred because the company’s sales volume also fell 10% to 18.6 million tons. In addition, the average selling price or average selling price (ASP) also fell 12% yo-yo to Rp 680,000 per ton from Rp 776,000 per ton previously.

“The revenue and net profit achievement is below our previous estimates, only 70% and 64% of the current ratio,” explained Robertus, Monday (9/11).

Given the achievement of PTBA, members of the index Kompas100 Today, in the first nine months of 2020, Kresna Sekuritas has revised PTBA’s net profit projection to Rp 2.19 trillion by the end of 2020. Previously, Kresna Sekuritas predicted that the coal issuer’s net profit could reach Rp 2.72 trillion.

However, considering that PTBA management suggested a possible dividend payout ratio of up to 75%, Robertus is of the opinion that PTBA’s shares are currently trading at an attractive valuation, which is 7.4% of the potential dividend yield.

In addition, its strategic position as the main coal distributor for the State Electricity Company (PLN), an arrangement that ensures stable domestic demand, Kresna Sekuritas also maintains a buy recommendation for PTBA shares with a target price of IDR 2,450, higher than the previous target price. namely Rp. 2,275.

Also Read: Quarter III-2020, Bukit Asam (PTBA) realized a capex of Rp 700 billion

However, there are a number of investment risks plaguing PTBA’s shares, including ASP which is lower than IDR 670,000 – IDR 700,000 per ton this year. Not to mention, the production and sales volumes were lower than the target of 24.9 million tons for production volume and 25.1 million tons for sales. In addition, there is a dividend payout ratio that is lower than 75%.