Flash Focus – Sawit Sumbermas Sarana (SSMS)

Mirae Asset Sekuritas Indonesia Research Andy Wibowo Gunawan +62-21-5088-7000 ext.: 163; andy.wibowo@miraeasset.co.id

A leap in SSMS’ 9M20 bottom-line performances November 2, 2020

Cumulatively, Sawit Sumbermas Sarana (SSMS/Buy/TP: IDR1,100) booked IDR2.7tr revenue in 9M20, increasing
by 13.2% compared to the same period last year. Furthermore, SSMS’ 9M20 net profit skyrocketed to IDR265bn,
from a net loss of IDR1bn in the same period last year due to lower COGS that reached IDR1.5tr (-15.5% YoY).
All in all, SSMS’ 9M20 net profit achieved 61.5% of both our and the consensus’ targets. Nevertheless, SSMS has
yet to publish its operational performance data, and our assumptions are currently under review.

SSMS booked weak 3Q20 financial results, reporting a net profit of IDR164bn (-62.6% QoQ). This weak 3Q20 net
profit was due to the step-up in other losses of IDR350bn (+814.1% QoQ). However, 3Q20 revenue still managed
to rise to IDR969bn (+13.8% QoQ), which we attribute to higher CPO ASP.

SSMS’ 9M20 financial performances

P&L (IDRbn) 3Q19 2Q20 3Q20 QoQ (%) YoY (%) 9M19 9M20 YoY (%) % of FY20 Mirae Asset % of FY20 Consensus
Revenue 922 852 969 13.8 5.0 2,419 2,739 13.2 70.3 70.3
COGS -671 -481 -507 5.5 -24.3 -1,743 -1,472 -15.5
Gross profit 252 371 462 24.5 83.3 676 1,267 87.4
EBIT 127 163 336 106.7 164.8 282 821 190.7 65.9 65.9
Other inc. (exp) -387 -38 -350 814.1 -9.5 -337 -415 23.3
Net int. inc (exp) -62 -96 -61 -36.1 -1.6 -190 -208 9.5
Others -1 514 -120 N.A N.A -34 -169 394.8
Pre-tax profit -323 542 -195 N,A -39.6 -279 28 N.A
Net profit 14 440 164 -62.6 N.A -1 265 N.A 61.5 61.5

Gross Margin (%) 27.3 43.5 47.6 28.0 46.3

Op. Margin (%) 13.8 19.1 34.7 11.7 30.0
Net Margin (%) 1.5 51.6 17.0 -0.1 9.7

Source: Company data, Mirae Asset Sekuritas Indonesia Research

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