CMRY — 2Q26 revenue up 23.4% on dairy, but a fire-related inventory provision and an FX swing pull reported profit both ways

KEY HIGHLIGHTS

The top line is genuinely strong and it is all dairy. 2Q26 revenue rose 23.4% YoY to IDR 3,344 Bn and 1H26 25.5% to IDR 6,461 Bn. The split is stark: dairy products grew 56.7% YoY in the quarter to IDR 1,463 Bn while consumer foods added only 5.8% to IDR 1,882 Bn. Dairy has gone from 34.4% of 2Q25 revenue to 43.7% in 2Q26 — a mix shift, not just growth.
Two items pull reported profit in opposite directions. Reported operating profit fell 2.8% YoY to IDR 612 Bn despite the revenue gain, because an inventory provision of IDR 99 Bn was booked entirely in 2Q26. It is not ordinary obsolescence: Note 7 attributes it to two warehouse fires on 6 and 14 June 2026, at Pati and at Cikupa in Tangerang, and an insurance claim has been submitted and is under evaluation, with inventories insured for roughly IDR 1,256 Bn. Add it back and operating profit rose 12.9%. Below the line the distortion runs the other way: the total FX benefit was IDR 126 Bn in 2Q26 against a IDR 37 Bn loss in 2Q25, a swing of IDR 163 Bn, most of it unrealised gains inside finance income.
Stripping both, the underlying quarter grew about 10%. Reported pre-tax profit rose 20.3% and net profit 20.0% to IDR 617 Bn. Remove the FX and pre-tax profit fell 4.6%; remove the FX and add back the provision and it rose 10.0%, which we regard as the cleanest read. Effective tax rate steady at 20.8%.
Margin and cost are where the caution sits. Gross margin fell 1.8pp YoY to 43.5% and 1H26 at 43.3% is 1.6pp below 1H25, consistent with dairy carrying a lower margin. Selling and marketing rose 26.7% YoY, ahead of the 23.4% sales gain. Capex nearly doubled, up 83.1% in 1H26 to IDR 224 Bn. Against consensus, revenue and net profit are ahead of pace while operating income and EBITDA are behind, because the provision hits the operating lines and the FX gain rescues the bottom line. Key watch: whether the dairy mix permanently resets gross margin lower, and whether the insurance claim is recovered, which would reverse part of the IDR 99 Bn in a later period.