Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on VERBUND AG. We currently have 9 research reports from 1 professional analysts.
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Strong 2016 earnings performance; cautious guidance; risks over German-Austrian market separation continue
08 Mar 17
The group continues on its positive earnings trend. The top-line was weak with revenue falling 6% yoy to €2,795m, missing expectations, but EBITDA improved by 17.5% yoy to €1,044m and net income by 104% to €424m. Adjusted for one-offs such as the gas contract negotiation, outstanding issues on district heating, and impairment losses on Romanian wind farms, EBITDA increased 6.6% to €894.5m and net income 21.2% to €325.9m, 4% ahead of expectations. Operating cash flows improved by 19.3% yoy to €804m, which has reduced net debt by 12.5% yoy to €3.22bn. The group has proposed a dividend of €0.29/share with a 31% payout ratio, better than expected. For 2017, the group expects EBITDA to reach €800m and net income €280m, in line with expectations.
Another guidance upgrade for 2016. Increasing likelihood of a German-Austrian market separation
09 Nov 16
The group has once again provided strong 9m results with revenues relatively flat with a 0.8% yoy increase to €2.12bn, but EBITDA increased 11.5% yoy to €810m and net income increased by 48.7% yoy to €466.4m. On an adjusted basis, net income still increased 12.7% to €276m and EBITDA 2.8% to €698m. The positive results were driven by the positive hydro performance, effective cost cutting, supply renegotiation contracts for gas assets and a higher contribution from networks. As a result, the group has raised once again its full-year guidance with EBITDA now expected to be €980m and reported net income €385m. The dividend policy is still maintained at a 30% payout ratio with an increase in adjusted net income to €315m.
Positive results confirm previous guidance upgrade
28 Jul 16
Strong half-year results for the company given the market conditions as revenue increased 3.9% yoy to €1,460.7m. However, reported earnings were negatively impacted on a comparative basis as 2015 benefited from positive non-recurring items in addition to impairment losses. As a result, EBITDA fell 8% yoy to €450.2m, operating profit decreased 37.2% yoy to €190.8m and net income contracted by 21.6% yoy to €153.9m. However, on an adjusted basis, the results provide a completely different story as EBITDA increased 1.8% yoy to €450.2m and income improved by 7.9% to €173.9m. Moreover, operating cash flows increased 13% yoy to €476.6m, while free cash flow before dividend payments contracted by 21% to €365m. As a result, the provided results confirm the guidance increase provided on 18 July 2016, when the group expected to achieve an EBTIDA of €840m and net income of €270m for the full year 2016. The 30% payout ratio would be calculated on an adjusted net income of €290m.
Guidance raised followed by a dividend cut
18 Jul 16
Before the half-year results, Verbund has raised earnings expectations for 2016 with EBITDA 12% higher to €840m and a net income of €270m (+17.3%). The improvement is due to cost reductions from restructuring measures, higher profit from the grid segment and a slight improvement in the electricity business.
Solid start to the year, offset by uncertainty over the dividend policy
04 May 16
Despite the difficult market conditions Verbund has provided strong results with revenue reaching €806m, a 10.9% yoy increase and 19% above expectations, driven by a higher customer base and an increase in electricity sales volumes (+9.2% yoy). EBITDA was relatively flat (-2% yoy), although it is 11% better than forecasts due to a higher contribution from regulated activities and the positive effects from the restructuring process. Operating profit increased 4.5% yoy to €129.4m and *adjusted net income increased by 30% yoy to €82.4m, mainly due to improved financial results, translating into an EPS of €0.24. Operating cash flows increased by 60% yoy and net debt decreased by 5.4% ytd to €3.48bn. Free cash flow after dividend payments remained in positive territory, although it decreased by 19% yoy to €216m, mainly driven by higher cash outflows associated with money market transactions (-€139m). Despite the strong performance, guidance has been maintained with EBITDA at €750m and €230m in net income as the group expects the performance to continue in the coming quarters. Moreover, the dividend policy is currently under review as the group is focusing on cash-flow generation.
Focus on cash flows as power prices fall: lower investment and dividends
15 Mar 16
Given the market environment, the group showed a good operating performance with revenue increasing by 3.1% yoy to €2,969m and EBITDA increasing 10% to €888m, positively boosted by one-offs. On an adjusted basis, however, EBITDA decreased by 6% yoy reaching €839m as the reversal on grid revenue provisions linked to SNT-VO and SNE-VO are non-recurring items with a €50m positive effect on earnings. The bottom line results were better than expected due to lower financial expenses (-55%yoy) and taxes reaching €207.7m (+64% yoy). On an adjusted basis, net profit reached €268.9m, which is a 24% yoy increase. Cash flows remained strong despite deteriorating conditions as operating cash flows decreased 6% yoy to €673.9m, where lower capex (-37% yoy), dividend payments (-62% yoy), added to €441m from divestments, have allowed the group to repay €893m of outstanding debt without any new debt begin issued, while maintaining free cash flow relatively flat at -€12.8m. In terms of guidance, the group has made clear its worries concerning lower power price developments as it now targets €750m in EBITDA and €230m in net income. The lower than expected dividend at €0.30/ps has been proposed, corresponding to a 50.2% pay-out on the reported basis and only 38.8% on the adjusted one. This amount was a last minute measure taken by Verbund’s board as a €0.35 dividend proposal was written in the annual report, with a later adhoc document stating the downward revision on the dividend payment to €0.30.
The tide is turning
20 Apr 17
Any investor worth their salt knows it is impossible to precisely call a bottom in a particular stock. For Gattaca, though, we believe this moment has now passed given the compelling valuation (6.9x EV/EBIT vs 9.8x sector average), attractive 9.8% unlevered cashflow yield and constructive secular trends supporting its specialist markets. Sure, Net Fee Income (NFI) like-for-likes (LFL) have fallen of late, yet equally there are now early indications that organic growth may soon turn positive.
19 Apr 17
We take a look at the supply and demand dynamics of the world’s largest diamonds. Less than 200 very large (>200 carat) gem quality diamonds have ever been found, yet 23 of these have been found in the past three years. This dramatic increase is being driven by a combination of the rapid increase in the number of billionaires and hence price and demand, combined with technological developments that have improved large diamond recovery and a certain amount of geological good luck.
19 Apr 17
Lombard Risk Management* (LRM): Beats demanding growth and profit forecasts (CORP) | Frontier Developments* (FDEV): Steaming ahead (CORP) | Tax Systems* (TAX): Right place, right time (CORP) | Acal (ACL): Stronger H2 and brighter outlook (BUY) | Fenner (FENR): Interim results signal upgrades (BUY) | Minds + Machines* (MMX): US and Europe domain sales (CORP)
Small Cap Breakfast
19 Apr 17
Global Ports Holding—Intention to float on Standard List. International cruise ports operator. Seeking $250m raise including $75m primary offer. Dorcaster—Schedule One Update. Admission now expected 3 May. RTO of Escape Hunt raising £14m at 135p Verditek— Intention to float on AIM. On Admission, the Company's subsidiaries will be involved in advanced solar photovoltaic, filtration and absorption technologies specialising in providing environmental services. Raising £3.5m. Admission in May. Eddie Stobart Logistics— Schedule 1. Admission expected 25 April but capital raising details TBC. ADES International Holding— Intends to join the Standard List in May raising up to $170m plus a vendor sale. Provider of offshore and onshore oil and gas drilling and production services in the Middle East and Africa. Admission expected in May. Tufton Oceanic Assets– Offer extended to 9 May to enable investors to complete further due diligence.