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Ceconomy’s Q2 performance was slightly ahead of market expectations. The group’s lfl sales improved 18% yoy, benefitting from a gradual lifting of COVID related restrictions. While the momentum continued in April 2022, we take a more cautious stance about the times ahead, considering the inflationary headwinds in areas like consumer demand and the supply chain. This is despite the estimation of a higher sale contribution from the brick & mortar format. We will trim our financial estimates but ma
Companies: CECONOMY AG
AlphaValue
Ceconomy’s Q1 performance was slightly below our expectations. This was mainly attributable to COVID-19-led restrictions (especially in the DACH region), supply-related disruptions and a cyber-attack in November (we see it as a one-off). However, the retailer’s exit rate has been quite encouraging and the trading conditions are also likely to improve gradually. We concur with the management’s outlook for FY21/22. While DACH needs to be overhauled better, the other issues are non-structural in na
Ceconomy’s Q4 trading performance was in line with our expectations. Lfl sales slumped 1.2% on the back of a tough comparable base. We expect the company to gain further strength in the forecast years, especially on its domestic turf ‘Germany’. Overall, the adjusted profit should grow ahead of the top-line momentum. We maintain our optimistic stance on the stock’s valuation.
Ceconomy’s trading statement for Q3 FY20/21 was a mixed bag – revenue was stronger but the adjusted EBIT was weaker than our expectations. Much of it was attributed to a weak show in Germany, which reeled under the long lockdowns and other pandemic-related restrictions. Although the online format remained strong, we expect gradual normalisation in the coming quarters, as the store footfall increases (with the easing of restrictions). We will trim the earnings but maintain a positive stance on t
Ceconomy’s strong Q1 performance was not a surprise. However, management’s announcement to suspend the FY20/21 outlook is an unavoidable dent in investor sentiment. We believe the company is well placed to sail through the tough times (courtesy a strengthening e-com proposition and healthy liquidity). In essence, there aren’t any major concerns regarding the company’s performance in the mid/long term. We maintain a positive stance on the stock’s valuation.
Ceconomy announced a double bonanza with a promising ‘Strategic Day’ and the resolution of its dispute with MediaMarkt Saturn’s minority shareholder Convergenta. We believe this deal is a win-win situation and the company’s performance is likely to improve further in the forecast years. However, Ceconomy might to face the issue of two CEOs (one of them might need to move out) in the mid-term.
There were no major surprises in Ceconomy’s Q3 results. The announcement of new steps (harmonisation of management structure and standardisation of processes across all count) and c.€100m cost savings from FY22/23 seems to bode well for the investor’s sentiment. We maintain a positive stance on the stock valuation.
Ceconomy’s preliminary trading update was better than our expectations. A strong showing in the online format and the COVID-19-related cost-cutting measures were instrumental in ensuring that the Q3 EBIT was similar to the previous year’s. The exit run-rate of online is also noticeable considering that 100% of the stores were operational in June. We maintain our positive stance on the stock’s valuation.
Despite the decent Q4 performance, the shuffling at the top has raised fresh questions about the revitalisation of top-line performance and the successful implementation of operational efficiency plan. While the domestic performance is still in the black, management needs to address multiple pain-points for sustained top-line growth. We take a cautious stance on the future performance of the stock, although the positive recommendation is maintained.
Q2 performance was in line with our expectations. Despite the lfl decline, the negative calendar impact and a 50bp slump in the gross margin, the adjusted EBIT margin (even after excluding the Fnac Darty contribution) remained flat. While new management needs to focus more on the Netherlands, the Spanish issue seems non-structural. The launch of initiatives like a centralised pricing strategy is also a step in the right direction. No change to our stock recommendation.
New management has announced a restructuring and efficiency programme, which promises to uplift profit by c.25% (vs FY17/18 performance). The one-time impact is also not a concern, with a pay-back period of less than 1.5 years (if implemented successfully). We will revise our financial updates and stock recommendation upwards.
Ceconomy has finally posted a good performance (vs three profit warnings announced over the past year). The key takeaways were: 1) overall positive lfl growth (despite a weak October performance), 2) stable profitability despite a 60bp slump in the gross margin, and 3) further reduction in the tax rate (which we believe is structural in nature). Although the stock price is up c.15% today, we do not see any growth trigger unless the new CEO shares the performance turnaround plan (expected on 21 M
The appointments of a new CEO and CFO were much awaited but is still a step in the right direction. Although Jörn Werner has a good track record, we expect the stock price to remain range-bound unless he comes up with a tangible performance turnaround plan.
The poor guidance for FY18/19 has caught almost everybody by surprise (although our earnings estimates were below the consensus). There seems to be no end to Ceconomy’s struggles in its core market of Germany. We do not see any growth trigger for the stock price unless the new CEO (who is yet to be hired) shares a convincing performance turnaround plan. We have slashed the earnings and target price for the stock.
In Q4, while management was able to honour its annual revenue guidance (at CER), the lfl and reported revenue came in below our expectations. Softer lfl performance outside DACH is a negative surprise for us – we estimated that the majority of the pain (related to 8 October 2018 profit warning) was attributable to Germany. Although the company’s Board is scouting for a new Captain of the ship, a performance turnaround looks to be an uphill task. No change to our stock recommendation.
Research Tree provides access to ongoing research coverage, media content and regulatory news on CECONOMY AG. We currently have 55 research reports from 3 professional analysts.
Topps Group is the UK’s largest specialist supplier and distributor of tiles and associated products to the UK’s domestic and commercial markets. Each of the last three years the Group has successfully achieved record revenue in a market that’s seen recent volume declines and regional peers enter administration. Following the right sizing of its business, Topps Group is now well positioned to capitalise on the economic recovery and continue taking share from competitors, supported by its global
Companies: Topps Tiles Plc
Zeus Capital
Companies: JDW MAB MARS WTB FSTA BOWL CPG SSPG LGRS SSTY OTB HSW TMO GYM MEX
Liberum
17th April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: 16 April 2024: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radi
Companies: ARS TIDE SCE SNX ECK CNS TST SPEC SSTY
Hybridan
HeiQ has announced the acquisition of a site in Portugal where the company intends to build a HeiQ AeoniQ production facility with a 3,000 tonne per year capacity. To support the acquisition, the company intends to raise c£2.44m via an equity placing, supported by the issue of a c£1.7m (€1.97m) convertible loan note (largely to management) that will convert upon completion of the raise. We see this as an important step in the development programme for HeiQ AeoniQ. Additionally, HeiQ has provided
Companies: HeiQ PLC
Cavendish
Borussia Dortmund’s progress to the semi-final of the Champions League brings a further upgrade to profit guidance for FY24. In addition to helping the financial results of the current year, the relative success of German teams against those of other nations in European competitions this season may ensure the club qualifies for the Champions League next season despite currently being outside the top four of the Bundesliga.
Companies: Borussia Dortmund GmbH & Co. KGaA
Edison
Pinewood’s transition to a pure-play automotive SaaS business is now largely complete. Today we introduce summary forecasts out to FY26 and reiterate the investment case. We see significant opportunity for Pinewood to grow its user base in the UK and internationally whilst generating high EBITDA margins and cash conversion. With a 24.5p special dividend embedded in the current price (payable Q1/Q2), the effective price today is 12.3p. Based on the Group’s FY27 target of £27m EBITDA, we estimate
Companies: Pinewood Technologies Group PLC
Bright Pier Group’s (BPG) H1 results reflect the highly challenging operating environment, with revenue -9% YoY to £16.2m and Adj EBITDA of £1.4m (H1/22A £3.0m). This decline was driven by weaker consumer demand (falling disposable incomes and low consumer confidence), train strikes and poor weather. Trading in H2 has remained relatively subdued, and as such, we lower our FY23E Adj EBITDA forecasts to £4.2m (from £5.5m). Whilst disappointing, we note that the group remains cash generative and co
Companies: Brighton Pier Group Plc
We are initiating coverage of a.k.a. Brands Holding Corp. ("a.k.a. Brands" or the "company"), a leading owner of primarily online apparel-based brands focused on Generation Z and Millennial consumers, with a Buy rating and $14.00 price target, or 10.9X our 2025 EBITDA projection of $20.2 million. The company's brands include: 1) Princess Polly, focusing on 15 to 25 year-old women; 2) Petal & Pup, which offers feminine styles for 25 to 34 year-old women; 3) Culture Kings, a street wear destinatio
Companies: GPS URBN ITX AEO AEO GES GES ITX GPS ANF 0R32 URBN
Small Cap Consumer Research LLC
Domino’s Pizza Group’s (DOM’s) new CEO has set an ambitious long-term growth target, including an acceleration in its net store opening programme. With better alignment between the company and its franchisees, management believes DOM should be capable of generating improved profit growth, versus that achieved in recent years, and potential higher returns.
Companies: Domino's Pizza Group plc
Vertu is the fourth largest automotive retailer in the UK, with 188 sales outlets and a track record of cross-cycle growth, principally through businesses it has acquired, funded by equity, debt and most importantly cash generation. Vertu operates across the entire vehicle lifecycle, including new and used vehicle sales, and vehicle servicing, repair and parts. Service and repair is a 40+% gross margin repeating business. With economic headwinds, the transition to electric vehicles, recent overs
Companies: Vertu Motors PLC
Progressive Equity Research
Companies: CML FDEV NRR SSPG RMV AO/ ZIN
Shore Capital
Companies: Marks and Spencer Group plc
Companies: AO World Plc (AO:LON)Marks Electrical Group Plc (MRK:LON)
Canaccord Genuity
On 9 January last year, we set out our ten top stock picks for 2023, for what turned out to be another relatively poor twelve months for UK equities due to two wars, stubbornly high inflation and further tightening of monetary policy. This was even as other major markets, such as the US, largely recovered in the year. In the 2023 calendar year, the AIM All-Share index fell 8.2% and is still 42% off its 2021 high. From the release of our 2023 top picks note, the average total return (assuming div
Companies: PTAL GHH IGP MSLH PINE NXQ EQLS NXR AXL
This morning's results from FIH are aligned to the prior year and show that the company is continuing to hold its own notwithstanding challenges. The company's three businesses all boast certain unique positives while being leaders in their specialities and / or geographies. For the Falkland Islands Company (FIC), H1 results reported this morning reflect the traditional tilt towards the second half, while both the UK businesses performed in line with expectations, Momart in particular benefit
Companies: FIH Group plc
WHIreland
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