Overhead Did the Heavy Lifting Again - Just From the Other Direction This Time
This is PT Sumber Alfaria Trijaya Tbk's unaudited interim consolidated financial statements for the nine months ended September 30, 2023, authorized for issue by the Board of Directors on October 27, 2023. The headline: net revenue rose 10.93% to Rp80,024,668 million, from Rp72,139,145 million, and net income attributable to owners rose 25.06% to Rp2,190,235 million, from Rp1,751,343 million (see Key Financial Metrics) - on the surface, a continuation of H1 2023's pattern of real growth outpacing overhead cuts.
It isn't. Isolating the standalone third quarter (9M total less H1's already-published Rp3,027,269 million) shows combined segment income actually fell 5.00% year-over-year, to Rp1,102,368 million from Rp1,160,427 million (see Segments Compared) - a sharp reversal of H1's genuine +15.76% segment growth. Net income to owners still rose in the standalone quarter (+16.06%, to Rp577,515 million from Rp497,579 million), but only because unallocated corporate overhead fell 33.60% standalone (Rp330,398 million from Rp497,596 million) - the widest single-quarter overhead swing this site has recorded for the company, and this time working in the opposite direction from Q1 2023's overhead-driven profit story, where the business itself was still growing even if overhead did more of the lifting. Here the underlying segments actually shrank.
The balance sheet, meanwhile, changed more than the P&L. Interest-bearing bank debt collapsed 89.06%, to roughly Rp171,397 million from Rp1,565,536 million at December 2022 (see Key Financial Metrics) - the Company retired nearly all its short and long-term bank loans this year, pushing Debt-to-Equity Ratio» to roughly 0.01x, the lowest this site has recorded for the company. Total equity also jumped 22.13% (Rp14,008,470 million from Rp11,470,692 million), but not because Alfamart itself raised capital - subsidiary PT Midi Utama Indonesia Tbk ("MIDI," trading as Alfamidi) completed the rights issue disclosed as a subsequent event at H1 2023, listing 4,611,764,800 new shares on July 4, 2023 and diluting the parent's own stake in MIDI from 89.43% to 77.09% (see Beyond the Usual).
The Prescription
Alfamart should keep the balance-sheet discipline that just produced its cleanest leverage position in this site's coverage - near-zero bank debt and a DER of roughly 0.01x is a genuine structural win, not a one-quarter accounting artifact, and gives the Company real flexibility it didn't have even at FY2022's prior net-cash high. What it should stop doing is letting a standalone quarter's overhead cut stand in for real operating growth without saying so: combined segment income fell 5.00% in the isolated third quarter, and nothing in this filing's presentation of the headline 25.06% net income growth flags that the segments themselves went backward. A reader relying on the nine-month summary alone would never learn that the business's underlying engine cooled this quarter - and a company confident enough to retire nearly all its bank debt should be equally confident disclosing a quarter where growth came from cost management rather than the stores themselves.
Key Financial Metrics
9M 2023 vs. 9M 2022 (P&L and cash flow), September 2023 vs. December 2022 (balance sheet) - consolidated, unaudited
FX: IDR 15,526 = USD 1 (Bank Indonesia's period-end exchange rate as of September 30, 2023, per the filing's own foreign-currency policy note). This filing's own comparative column states Rp15,731 = USD 1 for December 31, 2022, matching every prior filing since Q1 2023 - no new rate conflict this quarter.
| Metric | 9M 2023 (IDR) | 9M 2023 (USD) | 9M 2022 (IDR) | YoY |
|---|---|---|---|---|
| Net Revenue | Rp80,024,668M | ~$5,154.2M | Rp72,139,145M | ✅ +10.93% |
| Gross Profit | Rp16,897,310M | ~$1,088.3M | Rp14,815,025M | ✅ +14.06% |
| Income from Operations ("Operating Income") | Rp2,881,062M | ~$185.6M | Rp2,335,478M | ✅ +23.36% |
| Income Before Final Tax and Corporate Income Tax | Rp2,802,294M | ~$180.5M | Rp2,227,681M | ✅ +25.79% |
| Income for the Period (total) | Rp2,255,389M | ~$145.3M | Rp1,792,856M | ✅ +25.80% |
| Net Income (attributable to owners) | Rp2,190,235M | ~$141.1M | Rp1,751,343M | ✅ +25.06% |
| EPS | Rp52.75 | ~$0.0034 | Rp42.18 | ✅ +25.06% |
| EBITDA» (Operating Income + D&A) | Rp5,591,959M | ~$360.2M | Rp4,764,500M | ✅ +17.37% |
| Balance sheet metric | Sep 2023 (IDR) | Sep 2023 (USD) | Dec 2022 (IDR) | Change |
|---|---|---|---|---|
| Total Assets | Rp33,010,986M | ~$2,126.2M | Rp30,746,266M | ✅ +7.37% |
| Total Liabilities | Rp19,002,516M | ~$1,223.9M | Rp19,275,574M | ✅ -1.42% |
| Total Equity (attributable to owners) | Rp12,117,256M | ~$780.4M | Rp11,221,527M | ✅ +7.98% |
| Total Cash (incl. time deposits) | Rp3,174,697M | ~$204.5M | Rp3,818,601M | ⚠️ -16.86% |
"Adjusted EBITDA»" remains a metric Alfamart doesn't report; the EBITDA line above is Income from Operations plus depreciation and amortization (Rp2,710,897M for 9M 2023, per the segment note, versus Rp2,429,022M for 9M 2022).
Free cash flow (net cash from operating activities minus capex - "acquisition of fixed assets" only, same basis as prior posts): +Rp2,537,169M, up 6.19% from +Rp2,389,379M in 9M 2022 - net cash from operating activities rose 7.02% to Rp4,117,348M (from Rp3,847,228M), while capex on fixed assets grew faster, 8.39% (Rp1,580,179M from Rp1,457,849M), lagging the 9.06% store-network growth (see Key Operational Metrics) by a narrow margin. Cash receipts from customers grew 11.42% (Rp82,705,192M from Rp74,226,345M), slightly ahead of the 11.01% growth in cash payments to suppliers (Rp67,136,320M from Rp60,529,781M).
Debt-to-Equity Ratio (DER)» (interest-bearing debt - short and long-term bank loans and consumer financing payables, excluding the right-of-use lease liability, on the same basis as prior posts; no bonds remain outstanding): roughly 0.01x at September 2023, down from 0.14x at December 2022 - the lowest DER this site has recorded for the company, a sharper drop than H1 2023's already-improved 0.11x. Total interest-bearing debt fell to approximately Rp171,397 million (short-term bank loans of Rp171,259M plus Rp138M of consumer financing payables) - both current and non-current bank loans are now essentially retired, down from Rp1,565,536 million at December 2022 (a 89.06% reduction). Net gearing widened to roughly -0.25x (net cash) at September 2023, from -0.20x at December 2022 - a deeper net-cash position than H1 2023's -0.14x, driven almost entirely by the debt payoff rather than a cash build (total cash actually fell 16.86% over the same period).
Key Operational Metrics
- Store network: 21,828 consolidated stores (Alfamart, Alfamidi, Lawson, and Dan+Dan, per the company's own presentation) as of September 2023, up 9.06% from 20,015 a year earlier at 9M 2022 - net addition of 1,361 stores year-to-date. Company-owned stores grew 10.89% (16,762 from 15,116) while franchise stores grew slightly slower, 9.99% (5,066 from 4,606) - a reversal of H1 2023's pattern, where franchise growth (10.02%) outpaced company-owned growth (9.06%).
- Permanent employees: 85,954 as of September 2023, up 5.55% from 81,432 at December 2022 per this filing's own comparative column (no year-ago figure disclosed in this filing).
- Market share: Alfamart's share of total Indonesia grocery rose to 13.2%, from 12.2% a year earlier (YTD September 2023 vs. YTD September 2022, per the company's own presentation) - flat against H1 2023's 13.2% reading, meaning the second-consecutive-period gain didn't extend further within the third quarter, though it held rather than reversed. Share of Modern Trade rose to 27.5% (from 25.2%), and share of Modern Trade Minimarket rose to 34.3% (from 32.2%).
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, for the nine months ended September 30.
| Segment | Revenue (9M 2023) | Revenue (9M 2022) | YoY | Segment Income (9M 2023) | Segment Income (9M 2022) | YoY | Margin (2023 vs 2022) |
|---|---|---|---|---|---|---|---|
| Jabodetabek | Rp22,836,129M | Rp20,526,070M | ✅ +11.25% | Rp792,513M | Rp627,342M | ✅ +26.33% | ✅ 3.47% vs 3.06% |
| Java (excl. Jabodetabek) | Rp30,148,849M | Rp27,592,938M | ✅ +9.26% | Rp1,842,866M | Rp1,762,807M | ⚠️ +4.54% | ⚠️ 6.11% vs 6.39% |
| Outside Java | Rp27,039,690M | Rp24,020,137M | ✅ +12.57% | Rp1,494,258M | Rp1,385,267M | ⚠️ +7.87% | ⚠️ 5.53% vs 5.77% |
Only Jabodetabek gained margin on a cumulative nine-month basis - a genuine reversal from H1 2023, where Jabodetabek and Java excluding Jabodetabek both gained margin and Outside Java was the lone loser. Now the pattern has flipped almost entirely: Java excluding Jabodetabek's margin slipped to 6.11% (from 6.39%) and Outside Java's fell to 5.53% (from 5.77%), while Jabodetabek's kept extending its gain (3.47%, from 3.06%). Since the standalone-quarter math above already shows combined segment income falling 5.00% in Q3 alone, the two segments losing cumulative margin are the more likely source of that weakness, not Jabodetabek.
Segments Compared
Combined segment income grew just 9.38% year-over-year on a cumulative nine-month basis (Rp3,775,416M to Rp4,129,637M) - a real deceleration from H1 2023's 15.76%, and, as the opening section above shows, the standalone third quarter alone actually posted a 5.00% decline. Unallocated corporate overhead fell 13.29% cumulatively (Rp1,439,938M to Rp1,248,575M) - overhead's share of combined segment income fell to 30.23%, from 38.14% a year earlier, continuing the multi-year decline this site has tracked since FY2019, but the cumulative figure understates how concentrated the cut was: the standalone Q3 overhead reduction alone was 33.60% (see the opening section). Net income to owners grew faster than combined segment income by a wider margin than at H1 (25.06% vs 9.38%, versus H1's 28.63% vs 15.76%) - overhead discipline and non-operating items are doing proportionally more of the work behind the headline number than they were at mid-year, the opposite direction from the improvement H1 2023 reported over Q1.
Beyond the Usual
The rights issue mandate stays unaddressed for an eleventh consecutive filing - even as a subsidiary completes a similar transaction
Shareholders approved the up-to-5-billion-share Capital Increase with Pre-emptive Rights (HMETD) at the May 6, 2021 Extraordinary General Meeting - a mandate this site has now tracked across eleven consecutive filings, most recently H1 2023 (silent, like every filing since the FY2022 annual report stopped even acknowledging it). This filing was authorized for issue on October 27, 2023 - roughly 17.7 months (539 days) past the mandate's own May 6, 2022 regulatory deadline under OJK Regulation No. 32/POJK.04/2015 - and, like every filing since the FY2021 annual report, contains no reference anywhere to the rights issue having lapsed, been extended, been formally cancelled, or been replaced by a fresh shareholder approval. The Company's own public-offering history note again stops at the June 2015 non-preemptive rights issue, unchanged from every prior filing. The issued share count remains unchanged at 41,524,501,700.
Subsidiary Alfamidi's rights issue completed, diluting the parent's stake from 89.43% to 77.09%
Subsidiary PT Midi Utama Indonesia Tbk ("MIDI," trading as Alfamidi) - the entity whose own separate rights issue H1 2023 flagged only as a subsequent event - obtained IDX approval on July 4, 2023 and listed the full 4,611,764,800 new shares (par value Rp10, exercise price Rp270 per share) that same day. The transaction diluted the Company's own ownership in MIDI to 77.09%, from 89.43% at December 2022 - the largest single-quarter ownership swing this site has recorded for the subsidiary - and is the direct source of the Rp1,453,883 million "additional non-controlling interests from additional share capital of a certain subsidiary" line driving most of this quarter's 22.13% equity growth. A related warrant arrangement disclosed in the same footnote would let Lawson Inc., Japan take up to 6% of a different subsidiary (LWS, which operates the Lawson-branded stores) on a fully diluted basis if and when LWS itself completes an initial public offering - a transaction not yet underway, but the first indication in this site's coverage that an IPO for the Lawson business is even contemplated.
The Bank Aladin stake's unrealized loss deepened further, past both H1 and Q1's readings
The Rp500,000 million stake in PT Bank Aladin Syariah Tbk, first flagged at H1 2022 and tracked through H1 2023's -27.94% reading, now shows an accumulated unrealized fair-value loss of Rp183,823 million at September 30, 2023 - a 36.76% paper loss on the original investment, deeper than June's 27.94% and March's 29.41%, bringing the carrying value down to Rp316,177 million. The note also discloses a near-filing-date value of Rp298,530 million (a 40.29% loss, at a share price of Rp1,015) - again worse than the period-end figure, the third consecutive quarter this site has recorded the stake's near-filing value moving in the same direction as, or beyond, its period-end reading.
Supplier-funded rental and promotional income grew faster than net revenue, again
Rental and promotional participation income from suppliers - recognized as part of Net Revenue rather than broken out separately - grew 14.82% to Rp4,151,239 million for the nine months, from Rp3,615,342 million a year earlier, continuing to outpace net revenue's 10.93% growth. This is the same metric this site has tracked since FY2019; it isn't concerning on its own (suppliers pay for shelf placement and joint promotions as part of normal retail economics), but the gap between this line's growth and headline revenue growth is worth continuing to watch as it widens.
The related-party building lease liability to PIM eased slightly from H1's level, still far above December 2022's
The Company's lease liability to PT Perkasa Internusa Mandiri ("PIM"), an entity under common control that the Company rents building space, equipment, and services from, stood at Rp106,445 million (0.32% of total consolidated liabilities) at September 30, 2023 - a small decline from H1 2023's Rp110,652 million, but still roughly six times December 2022's Rp17,329 million. The filing again doesn't explain what drove the original increase or this quarter's small pullback.
Coverage Table
| Metric | 9M 2023 | 9M 2022 | YoY | Why it matters |
|---|---|---|---|---|
| Net Revenue | Rp80,024,668M | Rp72,139,145M | ✅ +10.9% | Slightly faster than H1's 12.42% pace has now settled into |
| Net Income (to owners) | Rp2,190,235M | Rp1,751,343M | ✅ +25.1% | Still growing well ahead of segments (+9.4%), a wider gap than H1's |
| Combined segment income (standalone Q3) | Rp1,102,368M | Rp1,160,427M | 🔴 -5.0% | The real story: segments shrank even as headline profit grew |
| Interest-bearing bank debt | Rp171,397M | Rp1,565,536M* | ✅ -89.1% | Nearly fully retired; DER now ~0.01x, lowest this site has recorded |
| MIDI ownership | 77.09% | 89.43%* | ⚠️ diluted | Subsidiary's own rights issue completed while the parent's stays silent |
| Rights issue disclosure | Zero mentions | Zero mentions | 🔴 unchanged | Eleventh consecutive silent filing, now ~17.7 months past deadline |
*December 2022 comparative, not September 2022, for the balance-sheet rows.
Target Valuation Range
Enterprise value ~Rp119.91 trillion (~$7.72B), implying 15.25x EV/EBITDA and a trailing P/E of ~37.31x - fairly valued to modestly rich. The stock's 14.7% quarterly rally has pushed every multiple this site tracks above H1 2023's already-elevated levels, on a quarter where the headline profit growth masks a standalone segment-income decline; the balance sheet improvement (near-zero debt) is real, but it's a capital-structure story, not evidence the retail business itself is accelerating.
Alfamart's shares closed at Rp2,960 on September 29, 2023 (the last trading session of the quarter) - up 14.73% from Rp2,580 at H1 2023, and up 23.83% from Rp2,390 a year earlier at 9M 2022. No stock split has occurred since 2013, so no price adjustment is needed.
| Market cap → enterprise value | Q3 2023 |
|---|---|
| Share price (period-end) | Rp2,960 |
| Shares outstanding | 41,524,501,700 |
| Market capitalization | Rp122.91 trillion (~$7.92B) |
| Plus: interest-bearing debt | Rp171,397 million |
| Less: cash and equivalents | Rp3.17 trillion |
| Enterprise value | Rp119.91 trillion (~$7.72B) |
| Peer-multiple sanity check | H1 2023 | Q3 2023 | Change |
|---|---|---|---|
| Trailing P/E | ~33.33x | ~37.31x | ⚠️ up |
| EV/EBITDA | ~13.80x | ~15.25x | ⚠️ up |
| P/B | ~9.09x | ~10.14x | ⚠️ up |
Trailing P/E (using trailing-twelve-month net income attributable to owners of approximately Rp3,294,176 million: FY2022's Rp2,855,284 million, less the already-published 9M 2022 figure, plus this quarter's Rp2,190,235 million) rose as the 14.73% price rally outpaced TTM earnings growth. EV/EBITDA (against trailing-twelve-month EBITDA of approximately Rp7,863,286 million) rose the same way. P/B (book value of approximately Rp12,117,256 million equity attributable to owners ÷ 41.52 billion shares) rose as the price rally outpaced this quarter's own equity growth, even though equity itself grew a healthy 7.98%.
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, for the same reason as prior posts: the rights issue mandate's continued silence (see Beyond the Usual) leaves an unresolved capital-structure question a forward model would need to take a view on either way. The share price moved within a Rp1,090-Rp3,090 range across the trailing two years to this quarter-end (based on month-end closes) - a 183.49% peak-to-trough swing, unchanged from H1 2023's window since both the low (February 2022) and the high (November 2022) still sit inside the trailing 24 months.
PT Sumber Alfaria Trijaya Tbk's unaudited interim consolidated financial statements as of September 30, 2023 and for the nine months then ended; the Company's corresponding investor presentation as of September 2023.