Bumitama Agri - Maybank Research 2024-02-28: FY23 Met Expectations; BUY For Its Consistently High Dividend Yields

• Bumitama Agri (SGX:P8Z)'s FY23’s results met our/consensus expectations. For FY24E, we now forecast a 14% y-o-y decline in core PATMI mainly on lower y-o-y CPO ASP and higher unit cost (on accelerated fertiliser application), mitigated by slightly better FFB output.

2H23: Sharply stronger h-o-h performance

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• Bumitama Agri's stronger y-o-y core PATMI in 2H23 was due to higher sales volume (+16% y-o-y) owing to higher FFB nucleus output (+7% y-o-y), lower unit cost of production and a marginally better CPO ASP (+0.6% y-o-y).
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FY24: Bumitama Agri targets 3%-5% y-o-y FFB growth

• Following a softening of FFB growth in FY23 (-2% y-o-y), Bumitama Agri is now targeting a +3-5% FFB growth for FY24E. Hence, we trimmed our FY24E-25E FFB (absolute) output by 3%/3% respectively, which now imply +4%/+3% y-o-y FFB nucleus growth for FY24E-25E.
• In terms of cropping pattern, Bumitama Agri expects FY24E’s 1H:2H output ratio at 43-45%:55%-57%.
• We also understand Bumitama Agri has little-to-no forward sales commitment in FY24E.

Anticipating a final dividend of S$0.0346 for FY23

• Read more at SGinvestors.io.

Ong Chee Ting CA Maybank Research | https://www.maybank-ke.com.sg/ 2024-02-28 SGinvestors.io

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