Bumitama Agri - Maybank Research 2024-11-13: 9M24 Results Within Expectations

• Bumitama Agri (SGX:P8Z)'s 9M24 results were within our/consensus expectations as surprisingly low output were mitigated by higher ASPs and lower fertiliser cost.
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Weaker output compensated by sharply higher ASPs

• Bumitama Agri reported a 3Q24 headline PATMI of IDR598b (-32% y-o-y, +13% q-o-q), bringing 9M24 headline PATMI to IDR1,455b (-30% y-o-y) which met 72%/70% of our/consensus full-year estimates.
• The weaker 3Q24 headline PATMI was due to lower revenue (-8% y-o-y, +7% q-o-q) on lower CPO sales volume (-24% y-o-y, +1% q-o-q), offset by much higher CPO ASP (IDR12,734/kg; +18% y-o-y, +4% q-o-q) and PK ASP achieved (IDR7,893/kg; +57% y-o-y, +16% q-o-q).
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Expecting FFB output to peak in Q4

• 9M24’s FFB nucleus output was down 21% y-o-y due to
  1. last year’s high base effect,
  2. ~6,000 ha or ~5% of nucleus matured area was “reallocated” to plasma smallholders in 1Q24 (i.e. government mandate), and
  3. the lagged impact of 3Q23’s El Nino on output.
• Positively, Bumitama Agri expects a strong output recovery in 4Q24, similar to the production pattern felt in 2020 and 2013.
• But owing to an already weak 9M24, Bumitama Agri revised down its FY24E’s FFB internal (nucleus + plasma) output growth to be down by high-single digit y-o-y growth. We now expect a 15% y-o-y decline (previously -9.5%) in our FY24E FFB nucleus output forecast.

FY24E-26E EPS forecasts raised by 4%-8%

• Read more at SGinvestors.io.

Ong Chee Ting CA Maybank Research | https://www.maybank.com/ 2024-11-13 SGinvestors.io

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