Bumitama

Bumitama: 1Q15 net profit slumped 41% y/y to Rp181.6b, and accounted for only 13% of full year street forecasts.

Revenue slipped 1.7% to Rp1,333.9b on lower average selling prices of crude palm oil (-11.5%) and palm kernel (-12.5%), which more than offset the higher sales volumes of 152,940 MT (+10.8%) for CPO and 29,666 MT (+14.8%) for PK.

Gross profit margin compressed to 34.9% from 45.6%, hurt by lower ASPs and higher fertiliser costs.

Bottom line was dragged by higher finance cost of Rp40.9b (+174%), FX loss of Rp31.6b compared to 1Q14 gain of Rp31.9b, absence of VAT refund and deeper losses of Rp43b by associates due to low yield of their newly mature plantation and unrealised FX loss on USD borrowings. These were partially offset by interest income of Rp32.4b (+452%).

At the current price, Bumitama is trading at 12.3x forward P/E and 2.3x P/B, compared to peer First Resources' 11.7x and 2.1x P/B.