Jan 21, 2011

United Tractors FY10 remains sturdy

PT United Tractors Tbk (UNTR), heavy equipment distributor, coal miner, and coal contractor, recorded strong volume growth last year in Komatsu sales volume, coal production, and overburden removal.  
In a formal statement today, United Tractors reported a 73.7% rise in Komatsu sales volume to 5,404 units last year from 3,111 units in 2009.
The mining sector was the biggest contributor for Komatsu sales with 3,313 units in 2010 from 1,709 units in 2009. Agriculture sector contributed 1,037 units of sales in 2010 from 674 units, while sales from construction sector rose to 577 units from 455 units. Forestry sector contributed 477 units for Komatsu sales from 273 units.  
However, month on month sales dropped 25.15% to 420 units in December 2010 from 313 units in November.
In line with heavy equipment sales, United Tractor's coal production rose 14.41% to 77.8 million tons from 68 million tons, while overburden removal inched up 8.86% to 650.9 million bank cubic meter (bcm) from 597.9 bcm.
In a notes today, Mandiri Sekuritas said  the FY 2010 heavy equipment sales were in line with the brokerage assumption.
"Komatsu sales volume of 5,404 units represented 99.7% of our FY10 assumption of 5,419 units. Overburden removal of 650.9 bcm reached 99.4% of our FY10 assumption of 655 bcm and coal production reached of 77.8 million tons reached 101% of our FY10 assumption of 77 million tons," Mandiri Sekuritas said.
Mandiri Sekuritas has a buy recommendation on UNTR. "We think that UNTR, being a distributor of heady equipments with strong position in mining and agriculture sectors, should be the beneficiary of booming commodity sector."

Disclosure: No position at the stock mentioned above.

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