AKR Corporindo

Stock Quote AKR Corporindo - AKRA:

Business Summary

AKR Corporindo is engaged in four lines of business:

• Trading and Distribution
• Logistic Services
• Manufacturing
• Coal Mining and Trading

Trading and Distribution

The company trades and distributes two main products: petroleum and basic chemicals.

The company was the first national private enterprise to enter the non-subsidized petroleum sector after the Indonesian government deregulated the oil & gas sector through Oil and Gas Law No 22 of 2001. Furthermore, the company was also the first national private enterprise that was appointed by the Downstream Oil and Gas Executive Agency (BPH Migas) to distribute subsidized petroleum (since 2010).

AKR Corporindo develops logistics networks to facilitate the petroleum distribution to customers, mainly in mining, electricity and the bunker industry. The company owns tank terminal facilities in various locations in Indonesia, including Kalimantan, Lampung, Medan, Jakarta, Surabaya and Semarang with total capacity of over 450,000 KL.

It trades and distributes basic chemicals, such as chloro-alkali chemicals, solvents, organic chemicals and non-organic chemicals. These basic chemicals are used for most industries, but particularly consumer goods, textiles, and glass.

AKR Corporindo’s retail network has grown to 31 Retail Petrol Stations (SPBKB) and Petrol Stations for Fisheries (SPBN) located in six provinces in North Sumatera, Lampung, West Kalimantan, South Kalimantan, East Kalimantan and South Sulawesi. The company was awarded an allocation of 267,892 KL for the year 2013, thus increasing its subsidized petroleum volume to 160% from 2012.

Logistic Services

The company offers logistics infrastructure and distribution in Indonesia and China to third parties by providing bulk cargo services and management in Indonesia’s major ports. AKR Corporindo facilitates storage tanks, warehouses and trucks in order to provide integrated logistics services to third parties in Indonesia.

Through PT Usaha Era Pratama Nusantara (UEPN), the company has invested in port equipments, such as Harbour Mobile Cranes, Rubber Tyred Gantry in the port of Surabaya, to provide stevedore services to third party customers.

The company owns and operates five river ports along the Pearl River in Guigang, Guangxi Province, China. Logistic facilities in China are utilized for transshipment activities of containers and other bulk products such as coal, sugar, steel and cement. Since the ports’ acquisition, AKR Corporindo has developed significant infrastructure to store and transport various bulk products.

AKR Corporindo also offers petroleum management systems to various companies, particularly to mining companies. This system covers all stages of petroleum logistics to customers.

Manufacturing

The company’s fully owned subsidiary, Khalista (Liuzhou) Chemical Industries Ltd (Khalista), is a sorbitol manufacturer located in China. Khalista manufactures sorbitol from starch. Sorbitol is the raw material for toothpaste, medicine and other low-calorie sweetener in various food products. Total production capacity of Khalista is 120,000 MT per year. Other than sorbitol, Khalista also produces derivative products of starches, such as hydrogenated maltose, glucose, and maltitol. Khalista supplies various sorbitol products, starch and starch sweeteners to China’s domestic market and various multinational companies.

PT Arjuna Utama Kimia (Aruki), in which AKR Corporindo has 99.96 percent ownership, is a manufacturer of adhesive materials in Surabaya, East Java. The adhesive materials are produced using Japanese standardized technology to maintain its quality and are used as adhesive in wood and paper industries.

Coal Mining and Trading

AKR Corporindo has 94.64 percent ownership in PT Anugrah Karya Raya (Anugrah), which is engaged in coal mining in North Barito (Central Kalimantan). Anugrah produces medium-calorie coal marketed to customers around Asia. Its subsidiary, AKR (Guangxi) Coal Trading Co Ltd (AGCT), runs coal trading businesses in Guigang-China for local customers. To facilitate its coal mining business activities, Anugrah invests in coal infrastructure, such as hauling road and river port in Kalimantan.

AKR Corporindo's Financial Highlights:

	2014	2015	2016	2017
Revenues	22,468.3	19,764.8	15,212.6	18,2879
Gross Profit	1,731.9	2,216.0	1,874.9	1,867.3
Net Profit	810.1	1,033.6	1,010.8	1,201.7
Operational Profit	1,063.2	1,349.2	1,175.4	1,136.9
Earnings per Share²	207.8	262.7	254.9	302.5
Total Assets	14,791.9	15,203.1	15,830.7	16,823.2
Total Liabilities	8,824.4	7,917.0	7,756.4	7,793.6
Dividend per Share²	80.0	120.0	120.0
P/E Ratio (x)	19.8	27.3	25.6	21.8

 

	2010	2011	2012	2013
Revenues	10,320.7	18,805.9	21,674.0	22,337.9
Gross Profit	620.5	1,051.7	1,261.3	1,367.6
Net Profit	325.2	2,308.9¹	649.3	648.3
Operational Profit	356.7	725.5	830.4	767.6
Earnings per Share²	87.08	605.29	168.91	167.35
Total Assets	7,778.9	8,417.9	11,787.5	14,633.1
Total Liabilities	4,840.0	4,741.1	7,577.8	9,270.0
Dividend per Share²	32.0	360.0	65.0	65.0
P/E Ratio (x)	19.9	5.0	24.0	26.1

^{in billion IDR rupiah (except stated otherwise)
¹ includes profit (IDR 1,689.9) from discontinued operations
² in IDR rupiah
Source: AKR Corporindo, Annual Report 2017}

Projection AKR Corporindo's Future Corporate Earnings:

	2018	2019	2020F	2021F	2022F
Net Revenue	23,548.0	21,703.0	20,367.0	22,527.0	26,071.0
Net Profit	1,648.0	717.0	998.0	1,200.0	1,211.0
EBITDA	1,228.0	1,422.0	1,710.0	1,929.0	1,981.0
P/E Ratio (x)	7.1	16.1	11.5	9.6	9.5
P/BV (x)	1.4	1.4	1.3	1.2	1.2
ROAA (%)	8.9	3.5	4.8	5.7	5.4

^{in billion IDR, unless otherwise stated
Source: Danareksa Sekuritas (26.09.2020)}