Strategy
Bumi Resources Minerals (BRMS IJ): 2Q26: Soft Results, Long-term Volume Remains Intact
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
Rp560
Rp1,040
85.7%
Rp1,330
Analyst
Highlights
- Soft 2Q26 results due to three factors: a) pushback operation, b) oversupply of gold in domestic market, and c) softening gold prices qoq.
- Long-term volume growth remains intact, with targets of 70,000-75,000 oz in 2026, 80,000 oz in 2027, 150,000 oz in 2028, and over 200,000 oz in 2029.
- Maintain BUY with a lower target price of Rp1,040 from Rp1,330.
Analysis
- Mine pushback and gold glut dragged 2Q26 into a loss. 2Q26 net profit swung to a loss of US$4.8m, from a profit of US$8.0m in 2Q25 and US$17.6m in 1Q26 as gold sold dropped 63.1% qoq to 6,301oz on the anticipated Poboya pushback, with only 70% of output sold amid domestic oversupply, while ASP eased 8.3% qoq to US$4,138/oz (1Q26: US$4,512/oz), and finance charges plus a forex loss pushed PBT to a loss. 1H26 net profit fell 42.3% yoy to US$13.3m on revenue of US$95.8m (-20.7% yoy), as gold sold dropped 45.9% yoy to 21,091oz, partly offset by a 44.5% yoy rise in ASP to US$4,400/oz; gross margin narrowed 2.0ppt yoy to 57.8% (1H25: 59.8%) and EBIT margin fell 8.1ppt yoy to 33.4% (1H25: 41.5%) as finance charges rose 74.4% yoy, leaving core profit at US$15.3m (-56.0% yoy). 1H26 formed only 13.0% of 2026 consensus, well below expectations on temporary factors.
- Three factors affecting 2Q26 results. Bumi Resources Minerals’ (BRMS) 2Q26 financial and production results were affected by three factors, though each carries an offsetting factor: a) temporary lower output resulting from the anticipated pushback operations at Poboya's River Reef mine site, a planned part of mine sequencing that had already been publicly disclosed through three separate press releases on 30 Jul 25, 29 Oct 25, and 16 Mar 26, and which has since been finalised, allowing BRMS to resume open pit mining activity in 2H26 with gold output expected to increase accordingly; b) BRMS faced challenges selling its gold output in 2Q26 due to oversupply in Indonesia, as many exporters shifted to selling domestically, prompting domestic buyers to demand discounted prices and resulting in only around 70% of BRMS' gold output being sold during the quarter, BRMS secured a contract with Aneka Tambang (ANTM) in late-Jun 26 to sell most of its gold output at competitive prices on a monthly basis through Jun 28; and c) the average gold commodity selling price declined 8.3% qoq from US$4,512 in 1Q26 to US$4,138 in 2Q26.
- Long-term volume growth remained intact. BRMS is upgrading its first carbon-in-leach (CIL) plant from 500 tpd to 2,000 tpd with full completion targeted for 4Q26. Poboya underground development is on track, supporting higher gold grade. The underground development at Poboya, operated by Macmahon Holdings’ Indonesian unit, is progressing steadily and remains on track to commence production by 1H27. Initial mining zones are expected to span 80-300 sqm, with some ores from the underground mine area projected to start contributing to production in late-26/early-27 (at a grade of around 2 grams/t (g/t)), above the current 1.3-1.5 g/t. BRMS is finalising its paste fill plant, which will be used to stabilise mined-out areas and support underground operations. Ventilation infrastructure (shaft sink) is also currently under development to regulate airflow. BRMS’ targets are: 70,000-75,000 oz in 2026, 80,000 oz in 2027, 150,000 oz in 2028, and over 200,000 oz in 2029.
Highlights
- Soft 2Q26 results due to three factors: a) pushback operation, b) oversupply of gold in domestic market, and c) softening gold prices qoq.
- Long-term volume growth remains intact, with targets of 70,000-75,000 oz in 2026, 80,000 oz in 2027, 150,000 oz in 2028, and over 200,000 oz in 2029.
- Maintain BUY with a lower target price of Rp1,040 from Rp1,330.
Analysis
- Mine pushback and gold glut dragged 2Q26 into a loss. 2Q26 net profit swung to a loss of US$4.8m, from a profit of US$8.0m in 2Q25 and US$17.6m in 1Q26 as gold sold dropped 63.1% qoq to 6,301oz on the anticipated Poboya pushback, with only 70% of output sold amid domestic oversupply, while ASP eased 8.3% qoq to US$4,138/oz (1Q26: US$4,512/oz), and finance charges plus a forex loss pushed PBT to a loss. 1H26 net profit fell 42.3% yoy to US$13.3m on revenue of US$95.8m (-20.7% yoy), as gold sold dropped 45.9% yoy to 21,091oz, partly offset by a 44.5% yoy rise in ASP to US$4,400/oz; gross margin narrowed 2.0ppt yoy to 57.8% (1H25: 59.8%) and EBIT margin fell 8.1ppt yoy to 33.4% (1H25: 41.5%) as finance charges rose 74.4% yoy, leaving core profit at US$15.3m (-56.0% yoy). 1H26 formed only 13.0% of 2026 consensus, well below expectations on temporary factors.
- Three factors affecting 2Q26 results. Bumi Resources Minerals’ (BRMS) 2Q26 financial and production results were affected by three factors, though each carries an offsetting factor: a) temporary lower output resulting from the anticipated pushback operations at Poboya's River Reef mine site, a planned part of mine sequencing that had already been publicly disclosed through three separate press releases on 30 Jul 25, 29 Oct 25, and 16 Mar 26, and which has since been finalised, allowing BRMS to resume open pit mining activity in 2H26 with gold output expected to increase accordingly; b) BRMS faced challenges selling its gold output in 2Q26 due to oversupply in Indonesia, as many exporters shifted to selling domestically, prompting domestic buyers to demand discounted prices and resulting in only around 70% of BRMS' gold output being sold during the quarter, BRMS secured a contract with Aneka Tambang (ANTM) in late-Jun 26 to sell most of its gold output at competitive prices on a monthly basis through Jun 28; and c) the average gold commodity selling price declined 8.3% qoq from US$4,512 in 1Q26 to US$4,138 in 2Q26.
- Long-term volume growth remained intact. BRMS is upgrading its first carbon-in-leach (CIL) plant from 500 tpd to 2,000 tpd with full completion targeted for 4Q26. Poboya underground development is on track, supporting higher gold grade. The underground development at Poboya, operated by Macmahon Holdings’ Indonesian unit, is progressing steadily and remains on track to commence production by 1H27. Initial mining zones are expected to span 80-300 sqm, with some ores from the underground mine area projected to start contributing to production in late-26/early-27 (at a grade of around 2 grams/t (g/t)), above the current 1.3-1.5 g/t. BRMS is finalising its paste fill plant, which will be used to stabilise mined-out areas and support underground operations. Ventilation infrastructure (shaft sink) is also currently under development to regulate airflow. BRMS’ targets are: 70,000-75,000 oz in 2026, 80,000 oz in 2027, 150,000 oz in 2028, and over 200,000 oz in 2029.
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
Rp560
Rp1,040
85.7%
Rp1,330
Analyst
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