Improvement in Quarterly Performance
Weak prices of CPO in 1H19 is a hiccup in matching up its 2018 performance, but its quarterly basis performance has improved. In 3Q19, AALI posted revenues of IDR3.8 trillion (-10.1% QoQ) as it successfully cut several costs, i.e., costs of revenues of IDR3.3 trillion (-13.4% QoQ) along with operating expenses of IDR278 billion (-2.8% QoQ). The cost reduction resulted in rising net profits of IDR67.5 billion (+970.6% QoQ). For 2019F, we estimate that AALI will be able to record revenues of IDR16 trillion, supported by rising prices of CPO prices. Meanwhile, net profits are likely to decline by 86% YoY, much lower than those of above 100% YoY declines posted by its peers.
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