PT Gajah Tunggal Tbk remains profitable in 1Q25 despite margin deterioration

PT Gajah Tunggal Tbk’s Net Sales experienced a marginal decline of 1.5% in 1Q25.  The Company reported Net Sales of Rp 4,404 billion in 1Q25 compared to Rp 4,472 billion in 1Q24. Sales in the domestic market increased slightly, despite fewer working days because of the Idul Fitri holiday. Domestic sales increased by 1.0%, where OEM sales showed a robust performance. On the other hand, export sales decreased by 9.3%, mainly due to softer sales to America.

The Company’s gross profit margin declined from 23.5% in 1Q24 to 19.5% in 1Q25. The margin decline was mainly caused by higher key raw material prices, especially rubber, as well as a depreciation of the Indonesian Rupiah versus the US Dollar. The margin deterioration, and to a lesser extent the lower sales performance, caused operating profit and EBITDA to decline. The Company’s EBITDA declined from Rp 793 billion / US$ 51.0 million in 1Q24 to Rp 624 billion / US$ 38.5 million in 1Q25. Despite the decline in operating profit and EBITDA the Company’s net profit increased from Rp 339 billion in 1Q24 to Rp 353 billion in 1Q25 due to lower interest expenses and a foreign exchange gain. The foreign exchange gain was a result of the translation of the Company’s foreign currency denominated assets. The Company redeemed all outstanding Senior Secured Notes due 2026 on 16 January 2025. As of that date, the Company no longer has any long-term debt denominated in US Dollar outstanding.