The Full-Year Number Hides a Fourth-Quarter Reversal
The ninth post on this company found Jabodetabek and Java excluding Jabodetabek both losing segment margin in Q1 2019. The tenth found that reversed almost entirely in H1, flagged as suspect because it landed in Ramadan. The eleventh, covering Q3 - the first quarter that year with no Ramadan tailwind - found all three segments still gained margin year-over-year and called the recovery genuine. This is PT Sumber Alfaria Trijaya Tbk's audited consolidated financial statements for the year ended December 31, 2019, and the full-year headline keeps the good story going: net revenue grew 9.2% to Rp72,944,988 million from Rp66,817,305 million, income from operations rose 27.6% to Rp1,790,402 million from Rp1,403,360 million, and net income attributable to owners jumped 71.1% to Rp1,112,513 million from Rp650,138 million. EPS rose from Rp15.66 to Rp26.79.
But isolating the implied Q4-only figures (this filing's full-year total less the already-reported 9M 2019 numbers) tells a different story than the one the annual headline suggests: Jabodetabek's standalone Q4 margin fell to roughly 3.40% from an implied 4.63% a year earlier, and Java excluding Jabodetabek's fell to roughly 6.06% from an implied 6.66% - both regions losing margin year-over-year in the one quarter this analysis can actually isolate, the opposite of what Q3 reported just one quarter earlier. Only Outside Java kept gaining, and even there the gain narrowed to roughly 25 basis points (4.76% from an implied 4.51%) versus Q3's 89-point Q3-only swing. The full-year totals still show Jabodetabek roughly flat (3.48% versus 3.49%) and Java excluding Jabodetabek up (6.06% versus 5.56%) only because the strong first nine months carry the average - a reader looking at the annual figures alone would miss that the underlying quarterly trend had already turned.
The Prescription
Alfamart's real opportunity remains Outside Java, which posted the largest full-year segment income growth of the three (54.5%, to Rp861,026 million) on revenue growth of 15.1% - still the fastest-growing and still the region with the most margin room left before it reaches Jabodetabek and Java excluding Jabodetabek's absolute levels, and the only one of the three that kept gaining margin even in the softer Q4. What it should stop doing: letting permanent headcount keep outgrowing the store network by an ever-widening margin - permanent employees grew 14.6% for the full year (51,656 to 59,214), more than double the 5.5% growth in the total store count (15,294 to 16,133), the widest gap this site has tracked for this company across four consecutive periods now. Selling and distribution expenses grew 9.1% for the year, roughly matching revenue growth rather than lagging it - the cost side isn't yet actively destroying the segment-margin story, but a management team that just watched two of its three regions' standalone-quarter margins reverse shouldn't keep adding headcount at more than double the pace of the network it's meant to support without explaining why.
Key Financial Metrics
FY 2019 vs. FY 2018 (P&L and cash flow), December 2019 vs. December 2018 (balance sheet) - consolidated, audited
FX: IDR 13,919 = USD 1 (period-end exchange rate as of December 31, 2019, the last trading day of the year).
| Metric | FY 2019 (IDR) | FY 2019 (USD) | FY 2018 (IDR) | YoY |
|---|---|---|---|---|
| Net Revenue | Rp72,944,988M | ~$5,240.7M | Rp66,817,305M | ✅ +9.2% |
| Gross Profit | Rp14,541,634M | ~$1,044.7M | Rp13,222,452M | ✅ +10.0% |
| Income from Operations ("Operating Income") | Rp1,790,402M | ~$128.6M | Rp1,403,360M | ✅ +27.6% |
| Finance Cost | Rp397,856M | ~$28.6M | Rp528,487M | ✅ -24.7% |
| Income Before Tax | Rp1,414,137M | ~$101.6M | Rp831,658M | ✅ +70.0% |
| Income for the Year (total) | Rp1,138,888M | ~$81.8M | Rp668,426M | ✅ +70.4% |
| Net Income (attributable to owners) | Rp1,112,513M | ~$79.9M | Rp650,138M | ✅ +71.1% |
| EPS | Rp26.79 | ~$0.0019 | Rp15.66 | ✅ +71.1% |
| EBITDA» (Operating Income + D&A) | Rp4,471,798M | ~$321.3M | Rp4,029,980M | ✅ +11.0% |
| Balance sheet metric | Dec 2019 (IDR) | Dec 2019 (USD) | Dec 2018 (IDR) | Change |
|---|---|---|---|---|
| Total Assets | Rp23,992,313M | ~$1,723.7M | Rp22,165,968M | ✅ +8.2% |
| Total Liabilities | Rp17,108,006M | ~$1,229.1M | Rp16,148,410M | ⚠️ +5.9% |
| Total Equity (attributable to owners) | Rp6,696,944M | ~$481.1M | Rp5,856,468M | ✅ +14.4% |
| Total Cash (incl. time deposits) | Rp3,909,150M | ~$280.8M | Rp2,070,429M | ✅ +88.8% |
"Adjusted EBITDA»" still isn't a metric Alfamart reports; the EBITDA line above is Income from Operations plus depreciation and amortization (Rp2,681,396M for FY2019, per the segment note, versus Rp2,626,620M in FY2018), matching both the company's own presentation-deck figure (Rp4,472 billion, rounded) and the convention used in every prior post here.
Free cash flow» (operating cash flow minus capex, both from the filed cash flow statement) fell to +Rp4,181,174M for FY2019, from +Rp5,260,894M in FY2018 (-20.5%) - net cash from operations fell 9.2% (Rp5,956,645M to Rp5,409,142M) while capex ("Perolehan aset tetap") rose 76.5% (Rp695,751M to Rp1,227,968M), extending the network-investment resumption first flagged at Q1 2019 and confirmed as a multi-quarter pattern at every post since. Total cash still rose a sharp 88.8% for the year to Rp3,909,150M (Rp3,898,050M in cash and equivalents plus Rp11,100M in time deposits) - a much lighter financing outflow this year (Rp892,330M net used, against Rp2,932,622M in FY2018, when the Company had a maturing bond series and heavier short-term bank-loan churn) more than offset the heavier capex pace.
Debt-to-Equity Ratio (DER)» (interest-bearing debt, including finance leases, consumer financing, and the JD.com borrowing discussed at FY2018, over equity attributable to owners, computed directly from this filing's own balance-sheet columns): 0.74x at December 2019, down from 0.81x at September 2019 and 0.90x at December 2018 - a fifth consecutive period of deleveraging, on total interest-bearing debt of approximately Rp4,957,243 million (from Rp5,150,381 million at September 2019 and Rp5,265,620 million at December 2018). Net gearing (net debt over the same equity base) fell further to 0.16x, from 0.27x at September 2019, on continued cash accumulation against a shrinking debt base. The Company's own narrower covenant metric (interest-bearing debt excluding the JD.com borrowing, over equity) came in at approximately 0.64x, down from 0.71x - both this and this site's own broader figure stay comfortably inside the Company's 2.5x bond covenant. The Company's own presentation reports a materially better net gearing ratio of 0.06x, down from 0.43x a year earlier - a different net-debt definition and comparison base than this site's own DER calculation above.
ROAA» / ROAE» (full-year, using net income attributable to owners over average total assets and average equity attributable to owners, the same basis as every prior post here): approximately 4.82% / 17.73% for FY2019 - the Company's own presentation shows a closely comparable 4.82% / 17.25% for the same period (the small ROAE gap is a different averaging convention, not a different net income figure).
Key Operational Metrics
- Total store network: 16,133 stores as of December 2019 (14,310 Alfamart, including Alfaexpress; 1,555 Alfamidi, including Alfamidi Super; 71 Lawson; 197 Dan+Dan), up from 15,742 at September 2019 - a net addition of 391 stores in the quarter, and up 5.5% for the full year from 15,294 at December 2018 (839 net additions). Alfamart's own store-count breakdown for the year: 631 net Alfamart additions, 144 net Alfamidi, 64 net Dan+Dan.
- Permanent employees: 59,214 as of December 2019, up 14.6% from 51,656 at December 2018 and up 2.9% from 57,559 at September 2019 - a fourth consecutive period this site has flagged headcount growing well ahead of the store network (see The Prescription above), with the full-year gap now the widest measured yet.
- Warehouses: 44 nationwide as of December 2019 (32 for Alfamart, 11 for Alfamidi, 1 for Dan+Dan), one more than the 43 reported at September 2019 - the second change since September 2017.
- Market share: the combined Alfamart/Alfamidi share of Indonesia's minimarket-format modern-trade channel fell to 34.8% for FY2019, from 36.1% in FY2018 (the Company's own presentation shows Alfamart's share of the channel alone at 29.8%, down from 30.8%, and Alfamidi's at 5.0%, down from 5.3%) - continuing the decline this site has flagged in every 2019 post. Against Indonesia's total grocery market and the broader modern-trade channel, both brands actually gained share for the year (Alfamart 10.1%→10.6% of all Indonesian groceries, Alfamidi 1.7%→1.8%), which only sharpens the minimarket-specific question: Alfamart is winning share from traditional and super/hyper formats overall while still losing share within the one format growing fastest.
- Seasonality note: the implied Q4-only figures above carry no Ramadan effect - the fasting month fell entirely within Q2 2019 (see H1 2019) - so the standalone-quarter margin reversal in Jabodetabek and Java excluding Jabodetabek (see above) isn't a seasonal artifact either; it reflects something that changed in the underlying business between Q3 and Q4.
- Industry backdrop: Indonesia's total grocery market (58 FMCG categories, per the Company's Nielsen-sourced data) grew 3.7% for FY2019, from 1.0% in FY2018. Modern trade grew 7.5% (from 4.5%), again driven by the minimarket format accelerating to 12.6% growth (from 7.9%), while traditional trade turned positive (0.5%, from -1.8%) and super/hyper's decline deepened further (-5.8%, from -3.3%). The minimarket channel's continued outgrowth of the segment where Alfamart is losing share (above) is the same tension every 2019 post here has flagged, now visible on a full-year basis.
Segment Performance
Alfamart reports the same three geographic segments as every prior post - Jabodetabek (greater Jakarta), Java excluding Jabodetabek, and Outside Java. Figures below use each segment's external revenue (excluding the minor inter-segment elimination Jabodetabek reports).
| Segment | Revenue (FY 2019) | Revenue (FY 2018) | YoY | Segment Income (FY 2019) | Segment Income (FY 2018) | YoY | Margin (2019 vs 2018) |
|---|---|---|---|---|---|---|---|
| Jabodetabek | Rp25,996,121M | Rp24,536,294M | ✅ +5.9% | Rp905,415M | Rp857,312M | ✅ +5.6% | ⚠️ 3.48% vs 3.49% |
| Java (excl. Jabodetabek) | Rp26,248,971M | Rp24,304,269M | ✅ +8.0% | Rp1,590,388M | Rp1,351,822M | ✅ +17.6% | ✅ 6.06% vs 5.56% |
| Outside Java | Rp20,699,896M | Rp17,976,742M | ✅ +15.1% | Rp861,026M | Rp557,386M | ✅ +54.5% | ✅ 4.16% vs 3.10% |
Jabodetabek's full-year margin is effectively unchanged (3.48% versus 3.49%, a 1-basis-point difference), the flattest of the three regions and the first period since Q1 2019 this region hasn't shown a clear margin direction on a cumulative basis. The number that actually explains it sits in the implied Q4-only slice: subtracting 9M 2019's already-reported figures shows Jabodetabek's Q4-only margin at roughly 3.40%, down from an implied ~4.63% in Q4 2018 - a real reversal in the one quarter this analysis can isolate cleanly, erasing nearly all of the gain the first nine months had built.
Java excluding Jabodetabek again posted the highest full-year margin of the three (6.06%) and the widest absolute full-year margin gain (50 basis points). But its implied Q4-only margin of roughly 6.06%, down from an implied ~6.66% a year earlier, shows the same reversal Jabodetabek's did - the full-year number still reads as an improvement only because 9M 2019's margin (6.06%) was already so far ahead of 9M 2018's (5.18%) that Q4's decline couldn't pull the annual average back down to flat.
Outside Java again grew revenue fastest (+15.1%) and posted by far the largest full-year margin improvement (106 basis points, on segment income up 54.5%) - extending the turnaround every post this year has reported. Its implied Q4-only margin of roughly 4.76%, up from an implied ~4.51% a year earlier, is a smaller gain than the 25-basis-point-plus swings the region posted in H1 and Q3, but it's still the only one of the three segments that kept gaining margin in the standalone quarter that carried none of Ramadan's help.
Isolating the implied Q4-only figures this way is what actually complicates the story Q3 2019 told: the "all three regions gained margin without Ramadan" read held for exactly one quarter. In the next one, two of the three regions reversed.
Segments Compared
Combined segment income rose 21.3% (Rp2,766,520M to Rp3,356,829M) for the full year - more than double net revenue's 9.2% growth, though slower than consolidated operating income's 27.6%. Unallocated corporate overhead grew 14.9% (Rp1,363,160M to Rp1,566,427M), slower than combined segment income growth - overhead's share of combined segment income actually fell for the year, from 49.3% to 46.7%. That's a materially better full-year read than 9M 2019 reported (overhead's share up slightly, from 54.0% to 54.4%), implying Q4's overhead growth alone was unusually light relative to segment income - a genuine point in the company's favor even as the segment-level margin picture above turned more mixed.
Beyond the Usual
Alfamart disclosed the Covid-19 outbreak as a subsequent event, before the pandemic's Indonesian impact was known
This filing, signed March 27, 2020, discloses that the Company's operations "may be adversely impacted" by the Covid-19 outbreak, noting a decline in the Indonesia Stock Exchange composite index, the domestic bond index, and the Rupiah's exchange rate that it attributes partly to the outbreak. The disclosure is explicit that the specific business impact "cannot be determined at this stage" and that effects "will be reported when they are known and can be estimated" - a standard, appropriately cautious subsequent-events note rather than a forecast, but the first time this site's coverage of Alfamart has recorded a disclosed risk of this kind. Worth tracking closely at the next quarter, given Alfamart's business is built on daily foot traffic into physical stores.
The insurtech stake's holding vehicle raised capital three more times in the second half of 2019, plus a fourth round in early 2020
PT Sumber Trijaya Lestari (STL), the subsidiary that bought a 14.28% stake in online insurance marketplace PT Kita Indonesia Plus for Rp14,000 million and had its capital increased once already as a subsequent event at H1 2019, increased its issued and paid-up capital three more times during the second half of 2019 - to Rp314,000 million on July 2 (the Company contributing Rp13,993 million), to Rp344,000 million on October 1 (Rp29,985 million, already disclosed as a subsequent event at 9M 2019), and to Rp394,000 million on November 25 (a further Rp49,975 million) - all preserving the same 99.95%/0.05% Company-to-MIDI split. Across just those three rounds the Company put roughly Rp93,953 million of fresh capital into STL in five months, on top of the original Rp14 billion investment. The filing still doesn't disclose what any of this capital is earmarked for, and the pace of injections - four rounds in under a year - reads as active, ongoing funding of a business line rather than a one-off stake purchase that happened to need a later top-up.
Franchise income growth normalized further, closing the year barely ahead of store-network growth
Income from franchise agreements, embedded within net revenue, rose to Rp334,553 million for FY2019 from Rp271,050 million in FY2018 - a 23.4% increase, ahead of the 9.2% growth in consolidated net revenue but continuing to decelerate from the 35.6% growth H1 2019 reported for the half and the 26.6% 9M 2019 reported for the nine months. Isolating the implied Q4-only franchise income (Rp85,411 million, against an implied ~Rp74,310 million a year earlier) shows growth of roughly 14.9% for the quarter alone - close to, though still ahead of, the 5.5% pace of full-year store-network growth, consistent with this site's read since H1 that an existing franchise base paying more per store, not a wave of new signings, is what's actually driving the line. Unearned franchise revenue grew only 6.2% over the full year (Rp66,573 million to Rp70,680 million), reinforcing that reading. Franchisee-sourced revenue overall - a broader figure covering all revenue booked through franchise-operated stores, not just the franchise-fee income above - was Rp13,441,055 million for FY2019, or 18.43% of net revenue, down slightly from 18.82% in FY2018.
The two 2020-maturity bond series moved fully into current liabilities, with still no disclosed refinancing plan
The Rp400,000 million 2015 Bonds Phase II Series B (maturing May 8, 2020) and the Rp1,000,000 million 2017 Bonds Phase I (maturing May 23, 2020) are both now fully classified as current liabilities, with a combined net carrying value of Rp1,399,072 million - unchanged from the classification 9M 2019 already reported. The Rp1,000,000 million 2018 Bonds Phase II series, not due until April 12, 2021, stays correctly classified as long-term. Combined nominal value across all three remains Rp2,400,000 million, flat from both September 2019 and December 2018. Nothing in this filing addresses refinancing plans for the two 2020 maturities - now due within months of this filing's signing date, and still an open gap this site has flagged across three consecutive posts.
A Philippine associate kept receiving capital top-ups every month from January through March 2020, alongside a related-party dilution at another subsidiary
Alfamart Retail Asia Pte. Ltd. (ARA), the Company's wholly owned vehicle for its 35% stake in Alfamart Trading Philippines Inc., received capital injections from the Company in each of January (US$3,084,906), February (US$3,096,263), and March 2020 (US$4,060,515) - each immediately passed through to the Philippine associate without changing the 35% ownership stake, and each disclosed as a subsequent event in this filing. Separately, subsidiary SIL increased its capital in March 2020 with the Company contributing Rp15,000 million alone; the other shareholder, PT Atri Medikatama, agreed not to participate in the new share issuance, diluting its stake from an unstated prior level down to 8.75% (the Company's stake rising to 91.25%). The filing doesn't explain why Atri Medikatama chose not to participate, which is the kind of related-party detail worth watching at the next quarter for whether it reflects a strategic shift or simply that shareholder's own capital constraints.
Coverage Table
| Metric | FY 2019 | FY 2018 | YoY | Why it matters |
|---|---|---|---|---|
| Net Revenue | Rp72,944,988M | Rp66,817,305M | ✅ +9.2% | Topline growth held steady with prior quarters' pace all year |
| Net Income (to owners) | Rp1,112,513M | Rp650,138M | ✅ +71.1% | Full-year profit growth far outpaced revenue, on lower finance cost and operating leverage |
| Jabodetabek margin (implied Q4-only) | ~3.40% | ~4.63% | ⚠️ down | Reverses the region's Q3-confirmed recovery in the one comparable standalone quarter |
| Java ex-Jabodetabek margin (implied Q4-only) | ~6.06% | ~6.66% | ⚠️ down | Same reversal as Jabodetabek, masked by a strong first nine months in the full-year figure |
| Permanent employees vs. stores | +14.6% vs. +5.5% | - | ⚠️ widening | Headcount now growing at more than double the store-network pace, the widest gap tracked here |
| Free cash flow | +Rp4,181,174M | +Rp5,260,894M | ⚠️ -20.5% | Capex resumption (+76.5%) is now a full-year pattern, not a single-quarter blip |
Target Valuation Range
Enterprise value ~Rp37.59 trillion (~$2.71B), implying 8.41x EV/EBITDA and a trailing P/E of ~32.8x - the seventh straight period of multiple compression, this time compressing hard on a genuinely stronger earnings base rather than drifting down slowly. The market isn't pricing in the standalone-quarter margin reversal this post found, which argues the stock is fairly-to-cheaply priced on trailing numbers but leaves the segment-level question this post raised unanswered for the next quarter to settle.
Alfamart's shares closed at Rp880 on December 30, 2019 (the last trading day of the year) - down 11.6% from Rp995 at September 2019, reversing that quarter's gain. The Company's only stock split (10-for-1, July 2013) predates this period and remains reflected in both the filed share count and today's historical price data - no further split has occurred since (confirmed against public split-history records, used only to validate that no adjustment is required here).
| Market cap → enterprise value | FY2019 |
|---|---|
| Share price (period-end) | Rp880 |
| Shares outstanding | 41,524,501,700 |
| Market capitalization | Rp36.54 trillion (~$2.63B) |
| Plus: interest-bearing debt | Rp4.96 trillion |
| Less: cash and equivalents | Rp3.91 trillion |
| Enterprise value | Rp37.59 trillion (~$2.71B) |
| Peer-multiple sanity check | Q3 2019 | FY2019 | Change |
|---|---|---|---|
| Trailing P/E | ~42.8x | ~32.8x | ✅ down sharply |
| EV/EBITDA | ~9.75x | ~8.41x | ✅ down |
| P/B | ~6.46x | ~5.46x | ✅ down |
Trailing P/E (~32.8x, using FY2019's own net income to owners of Rp1,112,513 million - a genuine trailing-twelve-month figure, not a blended one, since the filing covers the full year) is down sharply from Q3 2019, this time on both a falling price and a much larger full-year earnings base. EV/EBITDA (against FY2019 EBITDA of Rp4,471,798 million) fell as both a lower enterprise value and a larger EBITDA base pulled the multiple down. P/B (book value of ~Rp6,696,944 million equity attributable to owners ÷ 41.52 billion shares) fell as the 11.6% price decline more than offset book value's 4.7% quarterly growth.
No listed domestic peer still exists for a direct minimarket-format comparison - Indomaret remains privately held under the Salim Group. A full DCF still isn't included here: this filing gives this site its first genuinely clean full-year run rate for Alfamart's post-Q1-2019 margin recovery, but the standalone-quarter reversal this post found in two of three segments means one more quarter is needed before treating the trailing growth rate as a reliable multi-year forecast input, rather than a data-quality concern about the base year itself. The share price moved within a Rp595-Rp1,025 range across the trailing two years (a roughly 72.3% peak-to-trough swing, above the threshold this site treats as warranting its own section), with the December 2019 close sitting well below the range's midpoint - the softest close of the four 2019 quarter-end prices this site has now recorded (Rp900, Rp915, Rp995, Rp880), even though full-year earnings just posted their strongest growth rate of the year.
PT Sumber Alfaria Trijaya Tbk's audited consolidated financial statements as of December 31, 2019 and for the year then ended, and the Company's management presentation for the same period.