Bumi Resource Minerals (BRMS)

In-Line 1Q26 Earnings Despite Pit Pushback; Recovery Hinges on CPM Ramp-Ups

• 1Q26 earnings were broadly in-line, with net profit of US$17.5mn (+21.3% y-y), supported by higher ASP despite lower CPM volumes
• expects CPM recovery by early Jun26, driven by grade normalization and Oct26 CIL plant upgrade.
• Maintain Buy with higher TP of Rp1,100, underpinned by elevated gold prices, CPM underground monetization from 3Q27F.   

1Q26 in-line earnings despite ongoing pushback activity

BRMS booked 1Q26 revenue of US$69.5mn (+9.7% y-y), in line with our est and cons (19.7%/19.6% of FY26F), while net profit reached US$17.5mn (+21.3% y-y) forming 16.4%/17.9% of our FY26F/consensus (broadly in line with seasonal 1Q delivery (EBITDA stood at US$30.8mn (+2.0% y-y), while GPM expanded to 62.6% (vs 3M25: 57.1%), mainly supported by higher realized gold prices. Operationally, gold sales volume fell to 14.8koz (-32.5% y-y) due to CPM’s ongoing River Reef open-pit pushback, but the impact was cushioned by a higher gold ASP of US$4,512/oz (+60.6% y-y). Gold head grade improved slightly to 1.4g/t but remained below 1Q25’s 1.6g/t, while cash cost stayed elevated at US$1,603/oz on lower-grade feed and higher royalties.

CPM Recovery Hinges on Key Ramp-Ups

Mgmt. expects the River Reef open pit pushback to be completed by late May/early Jun26, enabling access to higher-grade ore from Jun26 and supporting grade normalization after temporary 4Q25-1Q26 dilution. The 500tpd-to-2,000tpd upgrade of CPM’s first CIL plant is targeted for Oct26, underpinning mgmt. ~80koz FY26F gold production (vs our ~77koz in FY26F). Medium-term, CPM’s underground development remains on track, with 3.5-4.9g/t high-grade ore expected to be mined from 3Q27F. The underground decline has reached ~800m with mining zones expected to be 100-300sqm, supporting stronger FY27-28F production growth alongside ongoing capex deployment.

Maintain Buy rating with an upgraded TP of Rp1,100.

We raise our FY26-28F est. by 11-31% and SOTP-based TP to Rp1,100, reflecting higher gold price assumption, expected grade normalization at CPM following the completion of the River Reef open-pit pushback, and improving monetization visibility from CPM’s underground assets. Key catalysts include completion of the 500tpd-to-2,000tpd plant upgrade, faster underground ramp-up from Q3 2027, and further progress from GM drilling campaign. Our SOTP implies total EV of US$9.1bn, with GM and CPM contributing 45% and 30% of value, respectively. Downside risks project execution delays, weaker drilling results, lower gold grades, and a gold price reversal.

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