July 30, 2025

The Beautiful Turnaround of CNMA

Market Commentary

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The current earnings season presents us with thousands of opportunities, while also signaling that the economy is slowing down. In this environment, strong earnings results are undoubtedly the gems every investor is seeking. CNMA, for one, clearly stands out.

Following a weak start to the year, CNMA delivered a notable turnaround in the second quarter of 2025. After posting a net loss of IDR 60bn and a 35% QoQ revenue decline to IDR 929bn in 1Q25, the company bounced back with a net profit of IDR 35bn in 2Q25—up 616% QoQ —while revenue more than doubled to IDR 1.95tn (+110% QoQ).

CNMA's Income Statement Projection

Nevertheless, on a first-half basis, performance remained soft, with revenue down 3% YoY to IDR 2.tn and net income falling 26% yoy to IDR 289bn. Total ticket admissions in 1H25 reached 42.5 million, down 8.6% yoy, and the occupancy rate declined by 230 basis points to 24%. EBITDA margin for 1H25 stood at 29.2%, with a net profit margin of 10%.

CNMA's GBO and Ticket Admission

The recovery in 2Q25 was primarily fueled by the strong performance of local titles, particularly in April and May. The animated film Jumbo led the box office with over 10.1 million admissions, followed by Pabrik Gula with 4.7 million. Meanwhile, Hollywood films underperformed, with MI: Final Reckoning garnering only 2.5 million viewers. Local content accounted for over 66% of CNMA’s total admissions in 1H25, up from 63% in the same period last year.

Despite ongoing macroeconomic headwinds, CNMA achieved growth in both Average Ticket Price (ATP) and Food & Beverage Average Selling Price (F&B ASP). ATP rose 5% YoY to IDR 46,483, while F&B ASP increased 8% YoY to IDR 25,034—supported by successful product diversification, especially in lower-tier cinemas and regions. Management projects total 2025 ticket admissions of 90–95 million, with over 8 million expected in July alone, again driven predominantly by local films.

Forecasted Revenue Contribution

We reiterate our BUY recommendation on CNMA with an unchanged target price of Rp184/share. While the 1H25 performance reflects a solid turnaround, we remain cautious heading into 2H25 due to uncertainties over Hollywood releases and persistent macro challenges.

Upside risks to our call include: (1) a potential uplift in purchasing power driven by higher government spending in 2H25, and (2) stronger-than-expected contributions from upcoming local films by established production houses. Key risks include delays in the film release schedule, further weakening of consumer spending impacting F&B sales, and margin compression as a result of volume-driven promotions.

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