Flash Note Aneka Tambang

ANTM IJ / ANTM.JK
30 July 2010

BUY
Strong 2Q10 Revenue Price : Rp2,150
Target Price : Rp2,850

Key Financial and Valuation Metrics

Year-end 31-Dec 2008 2009 2010F 2011F 2011F
Revenue (Rpbn) 9,592.0 8,711.4 11,157.7 13,082.1 15,419.2
Net profit (Rpbn) 1,368.2 604.3 1,241.8 1,771.8 2,292.0
EPS (Rp) 143.4 63.4 130.2 185.8 240.3
EPS growth (%) -73.3 -55.8 105.5 42.7 29.4
DPS (Rp) 215.2 57.5 5.9 2.6 5.4
Dividend yield (%) 10.0 2.7 0.3 0.1 0.2
P/E Ratio (x) 15.0 33.9 16.5 11.6 8.9
EV/EBITDA (x) 9.3 16.2 8.5 6.0 4.5
Return on Equity (%) 16.3 7.5 14.4 18.1 20.5
Net Gearing (%) cash cash cash cash cash

Source: Company and NISP Sekuritas

• Revenue jumped by 130.4% QoQ. In its quarterly activity report, Antam shared that it has managed to post
Rp2.66tn of revenue in 2Q10, 130.4% QoQ compared to Rp1.15tn in 1Q10. This increase was driven by 147.1%
jump in revenue from nickel products to Rp2.10tn from Rp849.6bn in 1Q10, where Rp1.52tn of revenue came from
ferronickel sales, which grew by 378.4% QoQ from Rp317.0bn a quarter earlier.
• Strong sales volume. The increase in ferronickel sales was backed by higher ferronickel sales volume of 8,080
tons, 385.9% higher from 1,663 tons in 1Q10. Ferronickel’s ASP was stable at US$9.38/lb. in both 1Q10 and 2Q10.
The increase in ferronickel in 2Q10 was expected as the company had previously announced delayed shipment in
1Q10, which will be booked in 2Q10 period.
• Higher contribution from gold. The company also posted higher revenue from gold where it contributed 17.8%
to Antam’s 2Q10 revenue or Rp474.4bn, which is 106.6% QoQ higher from Rp229.6bn in 1Q10. We foresee a higher
contribution from gold trading in 2Q10 compared to 1Q10 as gold sales volume from Pongkor decreased by 33.8%
QoQ to 1.4 tons.
• Strong nickel contribution helped 1H10 revenue. Such increase in 2Q10 helped the company to post Rp4.31tn
of revenue in 1H10, or relatively stable compared to Rp4.40tn in 1H09. Higher contribution from nickel products
managed to balance the company’s step to decelerate its gold trading business in 1H10. During 1H09, gold trading
had boosted the segment’s revenue to reach Rp2.56tn, in contrast with only Rp1.16tn booked in 1H10 periods.
• Revenue weaker than expected but margin is very healthy. Despite posting strong quarterly performance,
the company’s 1H10 results came below our expectation. We are still waiting for the full financial data that will be
released later next month before revisiting our assumptions. However, as we had used a tighter assumption on
margin (12.6% operating margin for 2010F vs 20.7% 1Q10 actual), we foresee the impact on target price to be less
significant. In the mean time, we still maintain buy on Antam.

Bagus Hananto
bagus@nispsekuritas.com
62-21-8379 5238 ext.7311
Aneka Tambang

Exh. 1: Operational Data

PRODUCTION VOLUME 1H09 1H10 YoY 2Q09 1Q10 2Q10 QoQ
Ferronickel Ton Ni 6,082 9,252 52.1% 2,786 4,411 4,841 9.7%
Nickel Ore:
Total High Grade Wmt 1,447,980 1,832,256 26.5% 913,206 911,185 921,071 1.1%
Total Low Grade Wmt 1,375,443 1,561,080 13.5% 863,869 649,458 911,622 40.4%
Total Nickel Ore Wmt 2,823,423 3,393,336 20.2% 1,777,075 1,560,643 1,832,693 17.4%
Gold Pongkor Kg 1,358 1,382 1.8% 644 681 701 2.9%
Gold Cibaliung Kg 30 30
Silver Kg 11,794 10,130 -14.1% 5,544 4,877 5,253 7.7%
Bauxite Wmt 333,066 49,988 -85.0% 67,095 49,988

SALES VOLUME 1H09 1H10 YoY 2Q09 1Q10 2Q10 QoQ

Ferronickel Ton Ni 7,075 9,743 37.7% 5,914 1,663 8,080 385.9%
Nickel Ore:
Total High Grade Wmt 1,467,980 1,832,256 24.8% 913,206 911,185 921,071 1.1%
Total Low Grade Wmt 1,375,443 889,241 -35.3% 632,780 390,284 498,957 27.8%
Total Nickel Ore Wmt 2,823,423 2,721,497 -3.6% 1,545,986 1,301,469 1,420,028 9.1%
Gold Pongkor Kg 1,358 3,403 150.6% 1,449 2,048 1,355 -33.8%
Gold Cibaliung Kg
Silver Kg 11,794 24,602 108.6% 9,718 14,191 10,412 -26.6%
Bauxite Wmt 333,066 136,911 -58.9% 87,800 27,117 109,794 304.9%

AVERAGE SALES PRICE 1H09 1H10 YoY 2Q09 1Q10 2Q10 QoQ
Ferronickel US$/Lb 5.5 9.4 70.2% 5.7 9.4 9.4 0.0%
Gold US$/Toz 925.6 1,157.1 25.0% 922.8 1,121.7 1,173.3 4.6%
Silver US$/Toz 12.4 17.6 42.8% 14.4 17.1 17.9 4.4%
Exchange rate (for I/S) US$/Rp 11,277 9,155 -18.8% 10,531 9,261 9,102 -1.7%

Revenue (Rpbn) 1H09 1H10 YoY 2Q09 1Q10 2Q10 QoQ

Ferronickel 927.6 1,833.3 97.6% 790.8 317.0 1,516.3 378.4%
Nickel Ore:
Total High Grade 548.6 893.1 62.8% 334.0 424.5 468.6 10.4%
Total Low Grade 150.8 222.3 47.5% 106.1 108.1 114.2 5.6%
Total Nickel 1,627.0 2,948.7 81.2% 1,230.9 849.6 2,099.1 147.1%
Gold 2,564.8 1,165.9 -54.5% 454.3 229.6 474.4 106.6%
Bauxite 30.4 23.3 -23.4% 16.5 3.6 19.6 441.5%
Silver 156.8 128.6 -18.0% 45.9 37.7 55.8 47.9%
Logam Mulia Services 12.6 15.7 24.8% 7.0 4.2 4.2 0.0%
Others 5.5 31.6 475.2% 0.8 29.3 5.6 -81.0%
Total 4,397.0 4,313.8 -1.9% 1,755.4 1,154.1 2,658.7 130.4%

Source: Company and NISP Sekuritas

2
Aneka Tambang

PT NISP Sekuritas
Puri Imperium Building (Head Office)
Office Plaza Unit G. 2, 3, 5
Jl. Kuningan Madya Kav. 5-6, Kuningan
Jakarta 12980 Indonesia
Phone. (021) 8379 5238 (hunting)
Fax. (021) 8379 5240
Email: info@nispsekuritas.com
Website: www.nispsekuritas.com

Research Team
+62 21 83795238
Bagus Hananto Deputy Head of Research bagus@nispsekuritas.com Ext 7311
Adrianus Bias Prasuryo Equity Analyst adrianus.bias@nispsekuritas.com Ext 7309
Lyana Margareth Equity Analyst lyana.margareth@nispsekuritas.com Ext 7327
Ariawan Fixed Income Analyst ariawan@nispsekuritas.com Ext 7711
Yuni Pratiwi Research Assistant yuni.pratiwi@nispsekuritas.com Ext 7338

Branches
Phone: Fax:

Jl. Pluit Kencana Raya No. 59

Pluit Jakarta (021) 6667 5050 (hunting) (021) 6667 5051
Jakarta Utara 14450

Wisma HSBC, 3A Floor

Bandung Jl. Asia Afrika No. 116 (022) 426 7288 (022) 426 8009
Bandung 40261

Intiland Tower, 1st Floor Suite 7

Surabaya Jl. Panglima Sudirman 101-103 (031) 547 1213 (031) 547 1314
Surabaya 60271

Medan Jl. Bogor No. 51, Medan (061) 415 4512 (061) 456 4753

Rating Definitions
BUY : We expect this stock to give total return of above 15% over the next 12 months.
HOLD : We expect this stock to give total return of between -15% and 15% over the next 12 months.
SELL : We expect this stock to give total return of -15% or lower over the next 12 months.

DISCLAIMER:

This report was produced by PT NISP Sekuritas, a member of the Indonesia Stock Exchange (IDX). The Information contained in this report
has been obtained from public sources believed to be reliable and the options, analysis, forecasts, projections and expectations contained in
this report are based on such information and are expressions of belief only. No representation or warranty, express or implied, is made that
such information or opinion is accurate, complete or verified and it should not be replied upon as such. This report is provided solely for the
information of clients of PT NISP Sekuritas who has to make their own investment decisions without reliance on this report. Neither PT NISP
Sekuritas nor any officer or employee of PT NISP Sekuritas accept any liability whatsoever for any direct or consequential loss arising from
any use of this report or its contents. PT NISP Sekuritas may be involved in transactions contrary to any opinions herein to make markets, or
have positions in the securities recommended herein. PT NISP Sekuritas may seek or will seek investment banking or other business
relationships with the companies within this report. This report is a copyright of PT NISP Sekuritas. For further information please contact our
number 62-21-83795238 or fax 62-21-83795240.