- Bumitama Agri’s 2Q23 results beat expectations. We expect earnings to improve in 2H23 as productivity recovers and costs moderate. However, valuation is fair, at 7x CY24F P/E, in line with peers’ 6-12x.
- - Read this at SGinvestors.io -
2Q23 earnings rose 77% Q-o-Q
- Bumitama Agri (SGX:P8Z)'s 2Q23 earnings rose 77% q-o-q but fell 42% y-o-y to IDR760bn on lower ASPs, bringing its 1H23 earnings to IDR1,189bn. This was above our and Street expectations, at 56% of FY23F, mainly due to higher-than-expected CPO sales volume from inventory run-down as well as lower-than-expected unit costs.
- - Read this at SGinvestors.io -
FFB growth of 31% Q-o-Q in 2Q23
- Bumitama Agri recorded FFB growth of 31% q-o-q in 2Q23, bringing 1H23 to an FFB decline of 12% y-o-y, due to a high base in 1H22. This is below our projection of +2.2% and management’s guidance of a 3-7% growth.
- Management is lowering its growth guidance to 0-5% for FY23F (from 3-7%), expecting 2H23 output to be at least 20% higher vs 1H23.
- In terms of weather, management noted that rainfall is still more than sufficient at its estates currently, with no El Nino impact as yet.
- To be conservative, we lower our FY23F-24F FFB growth to 0.3% and 2.6% (from 2.2-4.8%) while raising our FY25F growth to 6.1% (from 3.7%).
Normalised inventory levels in Mar 2023.
- Read more at SGinvestors.io.
Singapore Research RHB Securities Research | https://www.rhbgroup.com/ 2023-08-14
Read also RHB's most recent report:
2024-02-28 Bumitama Agri - Inexpensive Pure Play With Good Dividend Yields.
Price targets by 3 other brokers at Bumitama Agri Target Prices.
Listing of research reports at Bumitama Agri Analyst Reports.
Relevant links:
Bumitama Agri Share Price History,
Bumitama Agri Announcements,
Bumitama Agri Dividends & Corporate Actions,
Bumitama Agri News Articles
