Jakarta,- PT Adaro Energi Indonesia Tbk (ADRO) booked a net profit of US$ 1.64 billion (-34.2% yoy) in 2023. Based on Stockbit's review, this figure is equivalent to 110% of estimates and exceeds consensus.

Revenue fell -19.6% yoy to US$ 6.5 billion, but still exceeded (104%) estimates. The decline in revenue was partly due to a -26% yoy decline in average selling price (ASP). Meanwhile, coal sales volume grew +7% yoy to 65.71 million tons. On a quarterly basis in 4Q23, ADRO recorded a net profit of US$ 422.5 million (+22.5% qoq), with revenue edging up +2.3% QoQ to US$ 1.54 billion.

Operationally, ADRO's production volume for 2023 rose +4.8% yoy to 65.88 million tons, with strip ratio rising to 4.35x (vs. 2022: 3.75x).

Stockbit said that results that exceeded consensus estimates were also recorded by PT Adaro Minerals Indonesia Tbk (ADMR) which posted a net profit of US$ 441 million (+33.8% yoy) in 2023, exceeding (127%) consensus estimates.

Revenue grew +19.6% yoy to US$1.1 billion (109% of estimate), supported by coal sales volume that grew +39.4% yoy to compensate for the decline in ASP by -14% yoy. On a quarterly basis in 4Q23, ADMR recorded a net profit of US$ 190.5 million (+119% qoq), supported by a +42% qoq increase in revenue to US$ 365 million.

In terms of operations, ADMR's production volume during 2023 rose +52% yoy to 5.11 million tons. Meanwhile, the strip ratio rose to 3.66x (vs. 2022: 2.47x).

Stockbit's Sr. Investment Analyst, Anggaraksa Arismunandar said, solid performance that exceeded expectations on a quarterly and annual basis has the potential to be a positive catalyst for the movement of ADRO and ADMR shares on Friday (1/3/2024).

For this year, ADRO targets sales volume at 65-67 million tons, with ADMR sales volume targeted at 4.9-5.4 million tons.

"Meanwhile, their strip ratio this year is projected to be flat. With coal selling prices starting to stabilize, we expect the Adaro group to post solid performance throughout 2024," said Anggaraksa.