Aneka Tambang a Buy Before Earnings

Antam is looking to post strong earnings in 2012 and Shayne Heffernan has raised the Heffernan Capital Management price target for 2013 to 3,000IRP.

Aneka Tambang's revenue may have jumped 20 percent last year on strong ferronickel and gold sales, a top executive said on Wednesday.

At the Jakarta-based company known as Antam, revenue may have increased past Rp 10 trillion ($1.1 billion) in 2011, president director Alwinsyah Lubis said.

Our unaudited revenue may be more than Rp 10 trillion,'' he said, without offering any more information.

Ferronickel sales probably rose to 19,000 tons last year from 18,000 tons in 2010 while gold sales surged to 8 tons from 7 tons in the same time frame, Lubis said. He added that ferronickel sales comprised 42 percent of Antam's total revenue in 2011.

PT Aneka Tambang Tbk is an Indonesia-based diversified mining and metals company. The Company is engaged in the mining of natural deposits, manufacturing, trading, transportation and other related activities. The Company undertakes activities from exploration, excavation, processing to marketing of nickel ore, ferronickel, gold, silver, bauxite and iron sands.

Its nickel operations are located in Southeast Sulawesi and North Maluku, its gold mine is in Pongkor in West Java, while its precious metal refinery is in Jakarta, its bauxite mine is in Riau province and its iron sands mine is in Central Java. Its largest bauxite deposit is located at Tayan, West Kalimantan and its largest nickel deposit is at Buli, North Maluku. On December 28, 2010, The Company acquired 100% interest in PT Dwimitra Enggan Khatulistiwa.

In 2010, the company recorded Rp 8.74 trillion in revenue and Rp 1.68 trillion in net income, according to company data.

Lubis said in November that Antam was now working on a big ferronickel smelter project in eastern Indonesia.

Valued at $1.6 billion, it is part of the company's expansion efforts to comply with a new government regulation that requires miners to process minerals for export by 2014.

Once the plant commences operations at the end of 2014, it would be capable of producing 27,000 tons of nickel annually. The plant is set to be operated by Antam's unit Feni Haltim in Buli, Lubis said last year.

Buli is a village on Halmahera Island in Maluku. The project in Buli includes a $600 million, 275-megawatt power plant that will be built and operated by state utility company Perusahaan Listrik Negara, Lubis said last year.

A law will require companies by 2014 to add value to natural resources before being exported in a bid to advance industrial activity.

Valuation Ratios

Company Industry Sector S&P 500

P/E Ratio (TTM)
7.32
17.34
20.62
350.75

P/E High - Last 5 Yrs.
34.67
64.74
182.12
149.72

P/E Low - Last 5 Yrs.
7.60
17.31
27.46
12.32

Beta
1.31
1.03
1.29
1.20

Price to Sales (TTM)
1.55
4.11
1.86
2.24

Price to Book (MRQ)
1.61
2.62
2.04
3.62

Price to Tangible Book (MRQ)
1.83
2.70
2.51
5.56

Price to Cash Flow (TTM)
5.45
12.58
17.38
9.00

Price to Free Cash Flow (TTM)
34.04
3.17
3.37
19.81

% Owned Institutions
-
-
-
-

Dividends

Company Industry Sector S&P 500

Dividend Yield
4.02
1.50
1.41
2.08

Dividend Yield - 5 Year Avg.
3.33
1.04
1.52
2.44

Dividend 5 Year Growth Rate
-0.24
17.11
15.83
-2.11

Payout Ratio(TTM)
29.39
32.68
19.62
89.85

Shayne Heffernan

Shayne Heffernan oversees the management of funds for institutions and high net worth individuals.

Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services. www.livetradingnews.com