Top Down Strategy and Large Cap Stock Picks - the DBS Vickers ...

Stock Profile: Semen Gresik
Regional Equity Strategy Q4 2007
Income Statement (Rp bn)
Balance Sheet (Rp bn)
FY Dec 2005A 2006A 2007F 2008F FY Dec 2005A 2006A 2007F 2008F
Turnover 7,532.2 8,727.9 9,828.6 10,724.7 Net Fixed Assets 3,422.8 3,162.9 3,916.1 4,227.7
Cost of Goods Sold (4,640.4) (5,400.3) (5,922.4) (6,357.4) Invts in Assocs & JVs 0.0 0.0 0.0 0.0
Gross Profit 2,891.8 3,327.5 3,906.2 4,367.3 Other LT Assets 133.5 180.2 161.0 159.0
Other Opg (Exp)/Inc (1,352.6) (1,548.1) (1,651.3) (1,865.7) Cash & ST Invts 1,348.6 1,743.6 2,206.9 3,140.5
EBIT 1,539.2 1,779.4 2,254.8 2,501.6 Other Current Assets 2,392.0 2,409.7 2,520.7 2,582.9
Other Non Opg (Exp)/Inc 6.0 26.4 33.9 38.9 Total Assets 7,297.0 7,496.4 8,804.7 10,110.2
Associates & JV Inc 6.4 6.4 6.7 7.1
Net Interest (Exp)/Inc (98.5) 44.9 26.8 26.8 ST Debt 545.2 77.3 71.1 71.1
Exceptional Gain/(Loss) 0.0 0.0 0.0 0.0 Other Current Liab 1,595.6 1,382.8 1,820.5 1,952.4
Pre-tax Profit 1,453.1 1,857.0 2,322.2 2,574.3 LT Debt 467.1 391.2 143.2 143.2
Tax (440.4) (546.3) (696.7) (772.3) Other LT Liabilities 132.6 63.9 81.5 90.4
Minority Interest (10.9) (15.2) (32.5) (36.0) Shareholder’s Equity 4,487.2 5,499.6 6,574.3 7,703.1
Preference Dividend 0.0 0.0 0.0 0.0 Minority Interests 69.2 81.6 114.1 150.1
Net Profit 1,001.8 1,295.5 1,593.0 1,766.0 Total Cap. & Liab. 7,297.0 7,496.4 8,804.7 10,110.2
Net profit before Except. 1,001.8 1,295.5 1,593.0 1,766.0
EBITDA 2,091.4 2,370.0 2,901.0 3,207.6 Non-Cash Wkg. Cap 796.3 1,026.9 700.2 630.6
Sales Gth (%) N/A 15.9 12.6 9.1 Net Cash/(Debt) 336.3 1,275.1 1,992.7 2,926.3
EBITDA Gth (%) N/A 13.3 22.4 10.6
EBIT Gth (%) N/A 15.6 26.7 10.9
Effective Tax Rate (%) 30.3 29.4 30.0 30.0
Cash Flow Statement (Rpbn)
Rates & Ratios
FY Dec 2005A 2006A 2007F 2008F FY Dec 2005A 2006A 2007F 2008F
Pre-Tax Profit 1,453.1 1,857.0 2,322.2 2,574.3 Gross Margin (%) 38.4 38.1 39.7 40.7
Dep. & Amort. 552.2 590.6 646.1 706.1 EBITDA Margin (%) 27.8 27.2 29.5 29.9
Tax Paid 0.0 0.0 0.0 0.0 EBIT Margin (%) 20.4 20.4 22.9 23.3
Assoc. & JV Inc/(loss) (6.4) (6.4) (6.7) (7.1) Net Profit Margin (%) 13.3 14.8 16.2 16.5
Chg in Wkg.Cap. (263.8) (230.5) 326.7 69.6 ROAE (%) N/A 25.9 26.4 24.7
Other Operating CF (512.1) (616.7) (740.2) (819.0) ROA (%) N/A 17.5 19.5 18.7
Net Operating CF 1,223.1 1,594.1 2,548.1 2,524.0 ROCE (%) N/A 24.8 25.7 24.1
Capital Exp.(net) (190.8) (190.3) (1,381.6) (1,000.0) Div Payout Ratio (%) 15.8 30.0 32.5 36.1
Other Invts.(net) (75.0) (110.0) (6.7) (7.1) Interest Cover (x) 15.6 NM NM NM
Invts in Assoc. & JV 0.0 0.0 0.0 0.0 Debtors Turn (avg days) N/A 48.0 42.0 38.4
Div from Assoc & JV 0.0 0.0 0.0 0.0 Creditors Turn (avg days) N/A 29.5 27.9 28.0
Other Investing CF (0.8) (5.6) 26.0 9.0 Inventory Turn (avg days) N/A 69.8 66.3 67.0
Net Investing CF (266.6) (305.9) (1,362.4 (998.0) Current Ratio (x) 1.7 2.8 2.5 2.8
Div Paid (158.7) (262.8) (518.2) (637.2) Quick Ratio (x) 1.3 2.1 1.9 2.2
Chg in Gross Debt (376.0) (637.6) (254.2) 0.0 Net Debt/Equity (X) CASH CASH CASH CASH
Capital Issues 0.0 0.0 0.0 0.0 Capex to Debt (%) 18.9 40.6 644.9 466.8
Other Financing CF 18.8 7.3 50.1 44.9 N.Cash/(Debt)PS (Rp) 56.7 215.0 335.9 493.3
Net Financing CF (515.9) (893.2) (722.3) (592.3) Opg CFPS (Rp) 250.7 307.6 374.5 413.8
Net Cashflow 440.5 394.9 463.4 933.6 Free CFPS (Rp) 174.0 236.7 196.7 256.9
Valuation Graph : PE
21.0
19.0
17.0
15.0
13.0
11.0
9.0
Price & Price Relative to Index
Rp
5,675.00
4,675.00
3,675.00
2,675.00
1,675.00
Relative Index
158
138
118
98
78
7.0
Dec-04 Jun-05 Dec-05 Jun-06 Dec-06 Jun-07
675.00
58
2003 2004 2005 2006 2007
Semen Gresik (LHS) Relative JCI INDEX (RHS)
Source: Company, DBS Vickers
115