May 02, 2016 15:54:14
Ciputra Development: 1Q16 NPAT is 10% of ours and consensus

- Weak 1Q16 result. CTRA reported earnings of Rp144bn (-37% YoY & -59% QoQ), which is only 10% of ours and
consensus. Slower delivery is the culprit of weak earnings. Revenue declines by 8% YoY to Rp1.3tn. CTRA’s development
revenue is down by 16% YoY to Rp940bn. CTRA’s G&A cost increase by 17% YoY, which is mainly driven by 32% YoY
increase in salary cost.

- Gearing remains healthy. The company is standing at net gearing of 29% with net debt of Rp2.5tn. Sales advances is at
Rp5.7tn, stable on QoQ basis. Due to spike in income tax payment (tax paid Rp320bn versus reported final tax expense of
Rp68bn), the company generates negative operating cashflow of Rp37bn.

- Maintain Buy. We think slower deliveries are the main culprit for CTRA’s weak earnings. Also cashflow from operations
still looks healthy (turn negative which we suspect due to early repayment of income taxes). We expect better revenue
deliveries in the coming quarters. Maintain Buy with PT of Rp1,600.