Perusahaan Gas Negara

Stock Quote Perusahaan Gas Negara - PGAS:

Business Summary

Perusahaan Gas Negara plans, constructs and develops downstream natural gas businesses, which includes the processing, transportation, storage and trading of natural gas. Apart from natural gas, PGN also produces and trades manufactured gas (hydrocarbon gas).

The government has given PGN a mandate to develop natural gas infrastructure in Indonesia. In carrying out this mandate, PGN cooperates with local governments, both directly and through regionally owned enterprises. The company is one of the largest listed Indonesian companies in terms of market capitalization. Indonesia's power generation industry is PGN’s largest market, consuming about 40 percent of PGN’s total sales volume in 2012.

PGN served 91,590 customers in 2013 of which 96.70 percent were households and the rest (3.30 percent) consisted of commercial and industrial customers. In terms of volume the industrial customers absorbed 96.69 percent of PGN's total natural gas sales volume, while only 3.31 percent went to households and commercial customers.

PGN has three business divisions:

1. Transmission & Transportation
2. Distribution & Trading
3. Other Business Segments

• Transmission & Transportation

The company's transmission business activities involve transporting the producer’s natural gas through a high pressure transmission pipeline to the off-taker's transfer point. Through this activity, PGN generates income by charging a toll fee, which is set by BPH Migas.

• Distribution & Trading

PGN’s distribution & trading business is managed by the Strategic Business Unit (SBU). The operating area of this business segment includes Jakarta, Bogor, Bekasi, Banten, Karawang, Cirebon, Palembang, Sidoarjo, Surabaya, Pasuruan (all on the island of Java), Medan, Pekanbaru (on Sumatra), and Batam. The distribution and commercial business activities are managed by the company's sales and services units.

• Other Business Segments

The other segments in the business operations include fiber optic capacity leasing for network provision and construction and maintenance services. Fiber optic capacity leasing is managed by subsidiary PGASCOM, while construction and maintenance services is performed by subsidiary PGAS Solution.

Financial Highlights Perusahaan Gas Negara:

	2015	2016	2017	2018	2019
Net Revenues	3,068.8	2,934.8	2,969.6
Gross Profit	963.1	886.9	797.2
Operating Profit	557.2	444.2	377.0
Profit before Tax	437.4	385.0	275.6
Net Income	401.2	304.3	143.1
EBITDA	951.1	807.4	830.4
Total Assets	6,495.0	6,834.2	6,293.1
Total Liabilities	3,472.2	3,664.0	3,106.2
Net Income per Share¹	0.02	0.01	0.01
Dividend per Share²	91.32	75.18
P/E Ratio (x)	12.18	16.23	22.08
P/BV (x)	1.62	1.56	1.00

 

	2010	2011	2012	2013	2014
Net Revenues	2,178.5	2,230.4	2,580.2	3,001.5	3,253.4
Gross Profit	1,382.6	1,341.9	1,472.4	1,417.7	1,285.5
Operating Profit	1,008.2	898.2	1,018.5	933.7	859.0
Profit before Tax	873.9	872.0	1,148.3	1,065.7	929.9
Net Income	671.2	680.8	890.9	804.5	711.2
EBITDA	1,183.2	1,078.3	1,209.1	1,120.4	1,114.5
Total Assets	3,540.2	3,400.2	3,908.2	4,318.0	5,689.6
Total Liabilities	1,889.1	1,520.8	1,553.4	1,646.9	2,814.1
Net Income per Share¹	0.03	0.03	0.04	0.03	0.03
Dividend per Share²	154.44	134.62	202.77	210.4	144.84
P/E Ratio (x)	18.01	12.63	13.11	11.21	16.65
P/BV (x)					4.12

^{in million US dollar unless otherwise stated
¹ in US dollar
² in IDR rupiah
Source: Perusahaan Gas Negara, Annual Report 2017}

Indonesia’s demand for electric power continues to grow. PGN supplies natural gas to power generation plants to meet domestic demand for electricity. Both environmentally and economically, natural gas is becoming the preferred fuel choice over coal or diesel oil.

The trend of rising natural gas demand in Indonesia and restrictions on the export of unprocessed minerals and mining products starting from 2014 will further increase demand for natural gas for use in the domestic processing of mineral and mining products. However, the gap between gas supply, infrastructure and demand, which are geographically spread apart, has resulted in a lack of integration in the domestic gas market. This can be seen in the centralization of gas demand in areas of industrial concentration such as West Java, East Java and North Sumatra, while gas sources are frequently located in the remote areas, far from natural gas markets, and in many cases deep under the sea. Another gap is that production in a number of gas fields is still tied to long-term export contracts, while the country itself is experiencing a gas shortage.

Projection Future Corporate Earnings Perusahaan Gas Negara:

	2018	2019	2020F	2021F	2022F
Net Revenues	3,870.0	3,849.0	3,046.0	3,141.0	3,293.0
EBITDA	1,144.0	958.0	814.0	896.0	949.0
Net Income	305.0	68.0	54.0	124.0	150.0
P/E Ratio (x)	4.2	19.4	22.2	9.6	7.9
P/BV (x)	0.5	0.5	0.4	0.4	0.4
ROAA (%)	3.8	0.9	0.7	1.7	2.0

^{in million US dollar unless otherwise stated
Source: Trimegah Sekuritas (29/04/2020)}