Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on VOESTALPINE AG. We currently have 8 research reports from 1 professional analysts.
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Prices have not really stabilised in Q2 16/17
09 Nov 16
The price fall has moderated somewhat, but has continued to be negative. As a result, the group’s revenue was down by 5.4% to €2.64bn which brought the H1 number to €5.41bn, a fall of 6.5%. However, Voestalpine’s operating earnings stabilised somewhat in Q2 (EBITDA: +1.6% to €371m) whereas it was still down by 21% to €705m in H1. We had expected H1 numbers of €5.49bn and €690m, respectively. For the full-year, management now expects EBITDA to come in at last year’s level (statement before: ‘almost’ on last year’s level) whereas the outlook for an unchanged EBIT number has been maintained.
Life has got tougher
09 Aug 16
Voestalpine suffered a 7.7% revenue setback to €2.77bn in Q1 16/17 (FYE 31 March) and a 37% EBITDA decrease to €527m. All of the group’s other profit numbers are also sharply down. However, some of this is the result of one-off consolidation effects of €137m realised in Q1 last year. Excluding this gain from last year’s EBITDA number still leaves a profit setback of 14% for the current year, while we had expected a decrease of 5% and a revenue number of a good €2.9bn.
All steel prices down, but reasonable profits
02 Jun 16
Voestalpine’s sales and profit decline has accelerated in Q4 15/16 (through to March) as steel prices fell sharply. However, the numbers are very much in line with our projections. Full-year revenue was down by 1.1% to just below €11.1bn (-8.4% in Q4) and EBITDA fell by 5.5% to €1.45bn (-46%) in Q4). Net profit after minorities was up by 9% to €585m in the full year. These profit number changes are based on what Voestalpine released a year ago and not on the adjusted 2014/15 numbers management released today. We had expected revenue of €11.16bn, EBITDA of €1.50bn and net earnings of €615m.
Largest ever heavy plate order received for Nord Stream 2
19 Apr 16
Voestalpine was the supplier of heavy plates to Russian tube producer OMK, which delivered a total of 170,000 tons of tubes for Nord Stream 1 and was completed in 2012. Although final political decisions are still pending, OMK has received a 33% stake in the new order for Nord Stream 2. Deliveries are expected to start in August 2016 and will last through to February 2018. According to Voestalpine, this order is for several hundred thousand tons of heavy plates, i.e. clearly more than for the first project. The pipeline will be built next to the first one, thus connecting Russia and Western Europe via the Baltic Sea. It is not only objected by several countries in Midwest Europe (like Poland and the Baltic States) but also by others as it increases Europe’s dependence on Russian energy supply. This order will clearly help fill the capacities of Voestalpine’s Grobblech GmbH, which is part of the group’s Carbon Steel division. Whether it will also allow to generate a decent margin remains to be seen as the competition for these kinds of large-scale orders is, because of the investment slump in the energy industry, fierce to say the least.
9M 2015/16 numbers almost matched our projections
10 Feb 16
The group continued generating rising carbon steel and special steel prices in the last quarter. However, as shipments were down, consolidated revenue fell by 4% to slightly less than €2.6bn and the 9M revenue is up by only 1.5% to €8.38bn. This has also taken its toll on quarterly EBITDA which fell by 5% to €315m but is up by 11% to just above €1.2bn through to December. Both revenue and EBITDA numbers are below our projected €8.56bn and €1.23bn, respectively.
Voestalpine intensifies cost reduction efforts
17 Dec 15
Management admits that its medium-term revenue goal of €20bn revenue in 2020 will not be reached. The new guidance is for around €15bn which we find much more realistic and is possible as it suggests an annual sales growth rate of 6% from the end of the last fiscal year through to 2019/20. ‘We have been too optimistic’, the CEO has admitted. As falling raw material prices have to be passed on to clients, the group needs another cost reduction programme (on top of the €900m initiated in 2014) that will involve all divisions. Details will be released in January, but the amount will be considerably smaller. The CEO left the question unanswered as to whether these efforts will translate into lay-offs.
08 Dec 16
Elderstreet stake acquired 02 GENERAL NEWS Globalworth premium In this issue Venture capital firm Draper Esprit has taken a 30.8% stake in venture capital trust manager Elderstreet. Both investment managers focus on the technology sector and they will be able to co-invest. Elderstreet has investments in a number of AIM-quoted companies through its VCTs. The purchase was funded by an issue of Draper Esprit shares worth just over £250,000. Simon Cook, the chief executive of Draper Esprit, is a former partner at Elderstreet so he knows the business and the people who run it, although he did leave more than 14 years ago. Cook has previously acquired portfolios from 3i and Cazenove, two other firms where he has worked. Draper Esprit has an option to acquire the remaining shares in Elderstreet, which has more than £25m under management. Adding Elderstreet to the group enables Draper Esprit to offer investors a range of EIS funds, VCTs and an ISA qualifying listed evergreen patient capital fund. The enlarged group has venture capital assets under management of more than £350m. At the end of September 2016, Draper Esprit had a net asset value of 352p a share, which is similar to the current share price. The June 2016 flotation price was 300p a share. Draper Esprit is quoted on Ireland’s Enterprise Securities Market as well as AIM.
01 Nov 16
Since our last outlook note, Quadrise has begun to supply MSAR for extended LONO sea trials, paving the way for commercial adoption from calendar H217 onwards. In August it signed a memorandum of understanding with clients in the Kingdom of Saudi Arabia (KSA), which is a key enabler for progressing the production-to-combustion pilot there. In October it completed a placing and open offer raising a total of £5.25m (gross). This should enable it to transition comfortably to the commercial phase on successful completion of the LONO and KSA trials.
Dividends reinstated; is it time to turn (more) optimistic?
08 Dec 16
Glencore continues to surprise the markets, earlier with its fast pace of asset disposals and now with the reinstatement of dividends. The following were the key details shared with investors in a meeting held on 1 December 2016: 1/ completed $6.3bn of asset disposals; 2/ reduced net debt (including readily marketable inventories) by $12.5bn over the last 18 months; 3/ reiterated trading’s 2016 EBIT guidance towards the upper end of the $2.5-2.7bn range; 4/ expects healthy annualised 2016 free cash flows – even at Q1 16 commodity price lows; at 2017 forward prices, FCFs are guided to be $6.5bn; 5/ dividends would be reinstated from 2017 – with $1bn to be paid in two equal tranches in H1 and H2; thereafter (i.e. 2018 onwards), $1bn would be a fixed annual dividend payment (banking on the stability of trading’s cash flows) plus a minimum 25% of FCFs from industrial activities. Production guided to grow Source – Investor Presentation December 2016 While copper would be negatively impacted by the end-of-life impact at Alumbera and the Ernest Henry divestment, the output for all other commodities is guided to be higher (in varying degrees).
Raising Target Price to 2,500p per share
01 Nov 16
Royal Dutch reported clean EPS of US$0.35, nearly 50% ahead of consensus. More importantly, cash flow jumped QoQ to US$8.5bn which should go a long way to confirming Shell’s capacity to maintain the current dividend, despite the increase in gearing to 29.2%. Upstream returned to profitability on an underlying basis for the first time since 1Q15. We believe these results confirm our view that Shell’s dividend can and will be maintained at US$0.47 per quarter and we increase our Target Price to 2,500p per share, given further sterling weakness.
Conviction List Q4 2016
05 Oct 16
Since its inception in 2010, the Conviction List has outperformed the market in 13 of 18 periods and a reinvested Conviction List would have returned 255% against a Small Companies index that would have returned 130%. Our Conviction List returned 3.7% over the last quarter; this was set against the benchmark UK Small Companies index that returned 11.3% over the same period. Our Q4 portfolio reflects our outlook for a temporary sweet spot for UK growth during the second half of 2016. The downside risk from the uncertainty of the EU Referendum result has been countered by stimulus from the Bank of England, signs of a looser fiscal stance and an 18% YoY reduction in the Sterling Exchange Rate. Compressed corporate fixed income spreads continue to provide a valuation underpin for global equities.